Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 31, 2023 | Jun. 30, 2022 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Transition Report | false | ||
Entity File Number | 001-39752 | ||
Entity Registrant Name | Petros Pharmaceuticals, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 85-1410058 | ||
Entity Address, Address Line One | 1185 Avenue of the Americas | ||
Entity Address, Address Line Two | 3rd Floor | ||
Entity Address, City or Town | New York | ||
Entity Address State Or Province | NY | ||
Entity Address, Postal Zip Code | 10036 | ||
City Area Code | 973 | ||
Local Phone Number | 242-0005 | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | PTPI | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 12,567,127 | ||
Entity Common Stock, Shares Outstanding | 2,088,698 | ||
Entity Central Index Key | 0001815903 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | EisnerAmper LLP | ||
Auditor Location | Iselin, New Jersey | ||
Auditor Firm ID | 274 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash | $ 9,426,264 | $ 23,847,572 |
Accounts receivable, net | 2,110,246 | 2,455,386 |
Inventories | 1,815,113 | 519,649 |
Prepaid expenses and other current assets | 1,316,282 | 3,720,088 |
Total current assets | 14,667,905 | 30,542,695 |
Fixed assets, net | 39,177 | 49,397 |
Intangible assets, net | 12,244,484 | 25,293,149 |
API purchase commitment | 5,111,176 | 11,029,260 |
Other assets | 358,472 | 475,557 |
Total assets | 32,421,214 | 67,390,058 |
Current liabilities: | ||
Current portion of promissory note | 1,089,683 | |
Accounts payable | 1,806,399 | 4,557,969 |
Accrued expenses | 3,634,662 | 11,957,384 |
Accrued inventory purchases | 14,203,905 | |
Other current liabilities | 537,232 | 260,818 |
Total current liabilities | 7,067,976 | 30,980,076 |
Promissory note, net of current portion | 8,388,093 | |
Derivative liability | 460,000 | |
Other long-term liabilities | 262,678 | 405,018 |
Total liabilities | 15,718,747 | 31,845,094 |
Stockholders' Equity: | ||
Common stock (par value $0.0001 per share, 150,000,000 shares authorized, 2,079,387 and 2,068,472 shares issued and outstanding as of December 30, 2022 and December 31, 2021, respectively | 208 | 207 |
Additional paid-in capital | 107,428,652 | 106,233,577 |
Accumulated deficit | (90,726,393) | (70,688,820) |
Total Stockholders' Equity | 16,702,467 | 35,544,964 |
Total Liabilities and Stockholders' Equity | $ 32,421,214 | $ 67,390,058 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 2,079,387 | 2,068,472 |
Common stock, shares outstanding | 2,079,387 | 2,068,472 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Net sales | $ 5,992,054 | $ 7,811,264 |
Cost of goods sold | 2,289,418 | 1,599,566 |
Gross profit | 3,702,636 | 6,211,698 |
Operating expenses: | ||
Selling, general and administrative | 12,209,162 | 15,593,233 |
Gain on settlement with Vivus | (3,389,941) | |
Research and development expense | 1,740,280 | 1,788,491 |
Depreciation and amortization expense | 5,598,884 | 6,877,990 |
Intangible asset impairment | 7,460,000 | |
Total operating expenses | 23,618,385 | 24,259,714 |
Loss from operations | (19,915,749) | (18,048,016) |
Change in fair value of derivative liability | 460,000 | 9,430,000 |
Interest income | 14,194 | |
Interest expense, senior debt | (368,660) | |
Interest expense, promissory note | 596,018 | |
Net loss | $ (20,037,573) | $ (8,986,676) |
Net loss per common share | ||
Basic (in dollars per share) | $ (9.68) | $ (8.25) |
Diluted (in dollars per share) | $ (9.68) | $ (8.25) |
Weighted average common shares outstanding | ||
Basic Weighted average common shares outstanding | 2,070,210 | 1,088,977 |
Diluted Weighted average common shares outstanding | 2,070,210 | 1,088,977 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2020 | $ 97 | $ 79,171,099 | $ (61,702,144) | $ 17,469,052 | |
Balance (in shares) at Dec. 31, 2020 | 500 | 970,766 | |||
Conversion of Preferred Stock to Common Stock | $ 1 | (1) | |||
Conversion of Preferred Stock to Common Stock (in shares) | (500) | 6,061 | |||
Issuance of Common Stock | $ 88 | 21,744,915 | 21,745,003 | ||
Issuance of Common Stock (in shares) | 884,353 | ||||
Proceeds from exercise of warrants | $ 20 | 4,012,415 | 4,012,435 | ||
Proceeds from exercise of warrants (in shares) | 201,459 | ||||
Non-employee stock-based compensation | $ 1 | 187,801 | 187,802 | ||
Non-employee stock-based compensation (in shares) | 5,833 | ||||
Stock-based compensation expense | 1,117,348 | 1,117,348 | |||
Net loss | (8,986,676) | (8,986,676) | |||
Balance at Dec. 31, 2021 | $ 207 | $ 106,233,577 | (70,688,820) | $ 35,544,964 | |
Balance (in shares) at Dec. 31, 2021 | 2,068,472 | 106,233,577 | 35,544,964 | ||
Issuance of Common Stock for split | $ 1 | $ (1) | |||
Issuance of Common Stock for split (in shares) | 8,584 | ||||
Stock-based compensation expense | 1,195,076 | $ 1,195,076 | |||
Non-employee exercise of restricted stock units (in shares) | 2,331 | ||||
Net loss | (20,037,573) | (20,037,573) | |||
Balance at Dec. 31, 2022 | $ 208 | $ 107,428,652 | $ (90,726,393) | $ 16,702,467 | |
Balance (in shares) at Dec. 31, 2022 | 2,079,387 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (20,037,573) | $ (8,986,676) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 5,598,884 | 6,877,990 |
Intangible asset impairment | 7,460,000 | |
Bad debt expense (recoveries) | (170,816) | 148,885 |
Inventory and sample inventory reserve | (18,998) | (200,251) |
Amortization of deferred financing costs and debt discount | 12,500 | |
Lease expense | 117,085 | 103,978 |
Derivative liability | (460,000) | (9,430,000) |
Deferred revenue | 211,029 | 70,343 |
Gain on settlement with Vivus | (3,389,941) | |
Employee stock-based compensation | 1,195,076 | 1,117,348 |
Non-employee stock-based compensation | 187,802 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | 515,957 | 2,548,698 |
Inventories | (835,317) | 412,744 |
Deposits | 4,576 | |
Prepaid expenses and other current assets | 1,648,252 | (724,785) |
Accounts payable | (2,751,570) | (1,051,587) |
Accrued expenses | (1,802,422) | (2,726,403) |
Other current liabilities | 65,369 | (31,291) |
Other long-term liabilities | (142,340) | (195,902) |
Net cash used in operating activities | (12,797,325) | (11,862,031) |
Cash flows from financing activities: | ||
Payment of promissory note | (1,623,983) | |
Payment of senior debt | (6,653,292) | |
Payment of portion of senior debt end of term fee | (534,237) | |
Proceeds from Issuance of Common Stock | 21,745,003 | |
Proceeds from exercise of warrants | 4,012,435 | |
Net cash (used in) provided by financing activities | (1,623,983) | 18,569,909 |
Net (decrease) increase in cash | (14,421,308) | 6,707,878 |
Cash, beginning of year | 23,847,572 | 17,139,694 |
Cash, end of year | 9,426,264 | 23,847,572 |
Supplemental cash flow information: | ||
Cash paid for interest during the period | 596,018 | 421,821 |
Noncash Items: | ||
Noncash decrease in accrued expenses related to Vivus settlement | (6,520,283) | |
Noncash decrease in accrued inventory purchases related to Vivus Settlement | (14,203,905) | |
Noncash increase in promissory note related to Vivus settlement | 10,201,758 | |
Noncash increase in inventory due to API reclass | (441,149) | |
Noncash decrease in API purchase commitment | 5,918,084 | 114,997 |
Noncash decrease in other current assets: API purchase commitment | 755,554 | $ (114,997) |
Noncash issuance of common stock to non-employee | $ 3 |
Nature of Operations, Basis of
Nature of Operations, Basis of Presentation, and Liquidity | 12 Months Ended |
Dec. 31, 2022 | |
Nature of Operations, Basis of Presentation, and Liquidity | |
Nature of Operations, Basis of Presentation, and Liquidity | 1) Nature of Operations, Basis of Presentation, and Liquidity Nature of Operations and Basis of Presentation Petros Pharmaceuticals, Inc. (“Petros” or the “Company”) was incorporated in Delaware on May 14, 2020 for the purpose of effecting the transactions contemplated by that certain Agreement and Plan of Merger, dated as of May 17, 2020 (as amended, the “Merger Agreement”), by and between Petros, Neurotrope, Inc., a Nevada corporation (“Neurotrope”), PM Merger Sub 1, LLC, a Delaware corporation and a wholly-owned subsidiary of Petros (“Merger Sub 1”), PN Merger Sub 2, Inc., a Delaware corporation and a wholly-owned subsidiary of Petros (“Merger Sub 2”), and Metuchen Pharmaceuticals LLC, a Delaware corporation (“Metuchen”). The Merger Agreement provided for (1) the merger of Merger Sub 1, with and into Metuchen, with Metuchen surviving as a wholly-owned subsidiary of Petros (the “Metuchen Merger”) and (2) the merger of Merger Sub 2 with and into Neurotrope, with Neurotrope surviving as a wholly-owned subsidiary of Petros (the “Neurotrope Merger” and together with the Metuchen Merger, the “Mergers”). As a result of the Mergers, Metuchen and Neurotrope became wholly-owned subsidiaries of Petros, and Petros became a publicly traded corporation on December 1, 2020. On December 7, 2020, Neurotrope completed the spin-off of certain assets, whereby (i) any cash in excess of $20,000,000, subject to adjustment as provided in the Merger Agreement, and all of the operating assets and liabilities of Neurotrope not retained by Neurotrope in connection with the Mergers were contributed to Synaptogenix, Inc. (formerly known as Neurotrope Bioscience, Inc. and a wholly owned subsidiary of Neurotrope prior to the spin-off), a Delaware corporation (“Synaptogenix”) and (ii) holders of record of Neurotrope common stock, par value $0.0001 per share, Neurotrope preferred stock, par value $0.001 per share and certain warrants as of November 30, 2020 received a pro rata distribution of common stock of Synaptogenix, resulting in a separate, independent publicly traded company. The Mergers were accounted for as a reverse recapitalization in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Metuchen was determined to be the accounting acquirer based on an analysis of the criteria outlined in the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) No. 805, Business Combinations Business and Primary Marketed Products Petros is a pharmaceutical company focused on men’s health therapeutics with a full range of commercial capabilities including sales, marketing, regulatory and medical affairs, finance, trade relations, pharmacovigilance, market access relations, manufacturing, and distribution. Petros consists of wholly owned subsidiaries, Metuchen, Neurotrope, Timm Medical Technologies, Inc. (“Timm Medical”), and Pos-T-Vac, LLC (“PTV”). We are engaged in the commercialization and development of Stendra®, a U.S. Food and Drug Administration (“FDA”) approved PDE-5 inhibitor prescription medication for the treatment of erectile dysfunction (“ED”), which we have licensed from Vivus, Inc. (“Vivus”). Petros also markets its own line of ED products in the form of vacuum erection device products through its subsidiaries, Timm Medical and PTV. In addition to ED products, we have acquired an exclusive global license to develop and commercialize H100™, a novel and patented topical formulation candidate for the treatment of acute Peyronie’s disease. The Company’s priority is the ability to sell Stendra® OTC. All transactions between the consolidated entities have been eliminated in consolidation. Reverse Stock Split At the 2022 Annual Meeting, the stockholders approved our proposal to effect one reverse stock split of our outstanding shares of Common stock, at any ratio between 1-for-4 1-for-10 1-for-10 Liquidity and Going Concern To date, our principal sources of capital used to fund our operations have been the revenues from product sales, private sales, registered offerings and private placements of equity securities. The Company does not currently have sufficient available liquidity to fund its operations for at least the next 12 months. These conditions and events raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that these audited interim consolidated financial statements are issued. In response to these conditions and events, the Company is evaluating various financing strategies to obtain sufficient additional liquidity to meet its operating, debt service and capital requirements for the next twelve months following the date of this Annual Report. The potential sources of financing that the Company is evaluating include one or any combination of secured or unsecured debt, convertible debt and equity in both public and private offerings. The Company also plans to finance near-term operations with its cash on hand, as well by as exploring additional ways to raise capital in addition to increasing cash flows from operations. There is no assurance the Company will manage to raise additional capital or otherwise increase cash flows, if required. The sources of financing described above that could be available to the Company and the timing and probability of obtaining sufficient capital depend, in part, on expanding the use of Stendra® and continuing to invest in research and development pursuant to our Non-Prescription / Over-The-Counter (“OTC”) strategies related to Stendra®, which we believe has the potential to dramatically increase product sales in the future; further developing and commercializing H100; and future capital market conditions. If the Company’s current assumptions regarding timing of these events are incorrect or if there are any other changes or differences in our current assumptions that negatively impact our financing strategy, the Company may have to further reduce expenditures or significantly delay, scale back or discontinue the development or commercialization of H100 and possibly Stendra® OTC in order to extend its cash resources. The Consolidated Financial Statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern. We have experienced net losses and negative cash flows from operations since our inception. As of December 31, 2022, we had cash of $9.4 million, positive working capital of $7.6 million, and accumulated deficit of $90.7 million. Our plans include, or may include, utilizing our cash on hand, as well as exploring additional ways to raise capital in addition to increasing cash flows from operations. In January 2022, the Company executed a promissory note in favor of Vivus in connection with the Vivus Settlement Agreement in the principal amount of $10,201,758. As of December 31, 2022, the principal balance of the note is $9,477,776. The terms of this promissory note are discussed in Note 8. The Company will need to raise additional funds or curtail certain discretionary expenditures in order to maintain an appropriate level of cash to fund our operations. In addition to meaningful reductions in discretionary expenditures, the Company plans to focus on its developmental initiatives, predominantly attaining Stendra® OTC designation via FDA approval. While the Company is optimistic that it will be successful in its efforts to achieve its plans, there can be no assurances that it will be successful in doing so. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2) Summary of Significant Accounting Policies Use of Estimates The preparation of Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the Consolidated Financial Statements and reported amounts of revenue and expenses during the reporting periods. Such estimates include the adequacy of accounts receivable reserves, return reserves, inventory reserves, assessment of long-lived assets, including intangible asset impairment, and the valuation of the derivative liability, among others. Actual results could differ from these estimates and changes in these estimates are recorded when known. Risks and Uncertainties The Company is subject to risks common to companies in the pharmaceutical industry including, but not limited to, uncertainties related to commercialization of competitor products, regulatory approvals, dependence on key products, dependence on key customers and suppliers, and protection of intellectual property rights. The World Health Organization (“WHO”) declared the coronavirus (“COVID-19”) a global pandemic on March 11, 2020, and since that time many of the previously imposed restrictions and other measures which were instituted in response have been subsequently reduced or lifted. However, the COVID-19 pandemic remains highly unpredictable and dynamic, and its duration and extent continue to be dependent on various developments, such as the emergence of variants to the virus that may cause additional strains of COVID-19. Accordingly, the COVID-19 pandemic may continue to have negative effects on the health of the U.S. economy for the foreseeable future. The Company cannot reasonably estimate the length or severity of the impact that the COVID-19 pandemic, including the emergence of any new variants will have on its financial results, and the Company may experience a material adverse impact on its sales, results of operations, and cash flows in fiscal 2023 and beyond . During 2020, government regulations and the voluntary business practices of the Company and prescribing physicians had prevented in-person visits by sales representatives to physicians’ offices. The Company had taken steps to mitigate the negative impact on its businesses of such restrictions. In March 2020, the Company reduced our sales representative head count to reflect the lack of in-person visits. The Company has maintained a core sales team which continued to contact physicians via telephone and videoconference as well as continuing to have webinars provided by the Company’s key opinion leaders to other physicians and pharmacists. In response to the spread of COVID-19, in March 2020, the Company closed its administrative offices. In January 2022, the Company sub-leased its Manalapan, New Jersey office and all administrative employees are working remotely for the foreseeable future. The Company has fully resumed in-person interactions by its customer-facing personnel in compliance with any local and state restrictions. The Company also continues to engage with customers virtually as the Company seeks to continue to support healthcare professionals and patient care. Since the beginning of the COVID-19 pandemic, we have experienced a shift from in-person sales to online, telehealth-based sales. These online sales generally have lower gross margins than in-person sales, which has impacted our net revenues. Concentration of Credit Risk Financial instruments that subject the Company to concentrations of credit risk includes cash. The Company maintains cash on deposit at U.S.-based banks in amounts which, at times, may be in excess of insured limits. Segment Reporting Operating segments are components of a Company for which separate financial information is available and evaluated regularly by the chief operating decision maker in assessing performance and deciding how to allocate resources. The Company’s two segments, Prescription Medications and Medical Devices, focus on the treatment of male erectile dysfunction. The Prescription Medications segment consists primarily of operations related to Stendra®, which is sold generally in the United States, and H100™ for the treatment of Peyronie’s disease. The Medical Devices segment consists primarily of operations related to vacuum erection devices, which are sold domestically and internationally. See Note 18 Segment Reporting. Revenue Recognition Prescription Medication Sales The Company’s prescription medication sales consist of sales of Stendra® in the U.S. for the treatment of male erectile dysfunction. Under Accounting Standards Codification (“ASC”) Topic 606, Revenue Recognition In determining the transaction price, a significant financing component does not exist since the timing from when the Company delivers Stendra® to when the customers pay for the product is typically less than one year. The Company records prescription medication sales net of any variable consideration, including but not limited to discounts, rebates, returns, chargebacks, and distribution service fees (“DSA”). The Company uses the expected value method when estimating its variable consideration, unless terms are specified within contracts. The identified variable consideration is recorded as a reduction of revenue at the time revenues from sales of Stendra® are recognized. The Company recognizes revenue to the extent that it is probable that a significant revenue reversal will not occur in a future period. These estimates may differ from actual consideration received. The Company evaluates these estimates each reporting period to reflect known changes. As of December 31, 2022 and 2021, the reserves for sales deductions were $3.0 million and $4.7 million, respectively. The most significant sales deductions included in this reserve relate to returns, contract rebates, and DSA fees. Our estimates are based on factors such as our direct and indirect customers’ buying patterns and the estimated resulting contractual deduction rates, historical experience, specific known market events and estimated future trends, current contractual and statutory requirements, industry data, estimated customer inventory levels, current contract sales terms with our direct and indirect customers, and other competitive factors. Significant judgment and estimation is required in developing the foregoing and other relevant assumptions. The most significant sales deductions are further described below. Product Returns Consistent with industry practice, the Company maintains a return policy that generally allows its customers to return Stendra® and receive credit for product within six months prior to expiration date and up to one year after expiration date. The provision for returns is based upon the Company’s estimates for future Stendra® returns and historical experience. The provision of returns is part of the variable consideration recorded at the time revenue is recognized. As of December 31, 2022 and 2021, the reserves for product returns were $2.3 million and $3.8 million, respectively, and are included as a component of accrued expenses. During the years ended December 31, 2022 and December 2021, respectively, the Company recorded $9.4 million and $8.3 million of returns as a reduction of gross revenue. Contract Rebates, Coupon Redemptions and DSA Fees The Company establishes contracts with wholesalers, chain stores, and indirect customers that provide for rebates, sales incentives, DSA fees and other allowances. Some customers receive rebates upon attaining established sales volumes. Direct rebates are generally rebates paid to direct purchasing customers based on a percentage applied to a direct customer’s purchases from us, including fees paid to wholesalers under our DSAs, as described below. Indirect rebates are rebates paid to indirect customers that have purchased our products from a wholesaler under a contract with us. The Company has entered into DSAs with certain of our significant wholesaler customers that obligate the wholesalers, in exchange for fees paid by us, to: (i) manage the variability of their purchases and inventory levels within specified limits based on product demand and (ii) provide us with specific services, including the provision of periodic retail demand information and current inventory levels for our pharmaceutical products held at their warehouse locations. See Note 3. Accounts Receivable, net for further discussion of these reserves. Medical Device Sales The Company’s medical device sales consist of domestic and international sales of men’s health products for the treatment of erectile dysfunction. The men’s health products do not require a prescription and include Vacuum Erection Devices, PreBoost, VenoSeal, penile injections (Rx), and urinary tract infection tests. Under Topic 606, the Company recognizes revenue from medical device sales when its performance obligations with its customers have been satisfied. In the contracts with its customers, the Company has identified a single performance obligation to provide medical devices upon receipt of a customer order. The performance obligation is satisfied at a point in time when the Company’s customers obtain control of the medical device, which is typically upon shipment. The Company invoices its customers after the medical devices have been shipped and invoice payments are generally due within 30 days of invoice date for domestic customers and 90 days for international customers. In determining the transaction price, a significant financing component does not exist since the timing from when the Company delivers the medical devices to when the customers pay for the product is typically less than one year. The Company records medical device sales net of any variable consideration, including but not limited to returns. The Company uses the expected value method when estimating its variable consideration. The identified variable consideration is recorded as a reduction of revenue at the time revenues from the medical device sales are recognized. The Company recognizes revenue to the extent that it is probable that a significant revenue reversal will not occur in a future period. These estimates may differ from actual consideration received. The Company evaluates these estimates each reporting period to reflect known changes. Product Returns Consistent with industry practice, the Company maintains a return policy that generally allows its customers to return medical devices and receive credit for products within 90 days of the sale. The provision for returns is based upon the Company’s estimates for future product returns and historical experience. The Company has not made significant changes to the judgments made in applying Topic 606. As of December 31, 2022 and 2021, the reserves for product returns for medical devices were not significant. Contract Costs In relation to customer contracts, the Company incurs costs to fulfill a contract but does not incur costs to obtain a contract. These costs to fulfill a contract do not meet the criteria for capitalization and are expensed as incurred. As such, the Company did not have any contract assets at December 31, 2022 and 2021. Fair Value of Financial Instruments Certain assets and liabilities are carried at fair value under U.S. GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market. Level 3 — Unobservable inputs which are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. Financial instruments recognized at historical amounts in the consolidated balance sheets consist of cash, accounts receivable, other current assets, accounts payable, accrued expenses, and other current liabilities. The Company believes that the carrying values of cash, accounts receivable, other current assets, accounts payable, accrued expenses, note payable, and other current liabilities approximate their fair values due to the short-term nature of these instruments. In connection with the Mergers in December 2020, each security holder of Metuchen received an earnout consideration classified as a derivative liability to be paid in the form of Petros Common Stock. The Company estimated their fair value using a Monte Carlo Simulation approach. This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement within the fair value hierarchy. The fair value of the derivative liability as of December 31, 2022 and 2021 was $0 million and $0.5 million, respectively. See Note 9 Stockholders’ Equity. Accounts Receivable, net The Company extends credit to its customers in the normal course of business. Accounts receivable are recorded at the invoiced amount, net of chargebacks, distribution service fees, and cash discounts. Management determines each allowance based on historical experience along with the present knowledge of potentially uncollectible accounts. See Note 3 Accounts Receivable, net. Inventories Inventories consist of finished goods held for sale and raw materials. Inventories are stated at the lower of cost or net realizable value, with cost determined using the first-in, first-out method. Inventories are adjusted for excess and obsolescence. Evaluation of excess inventory includes such factors as expiry date, inventory turnover, and management’s assessment of current product demand. See Note 4 Inventories. Intangible Assets The Company accounts for recognized intangible assets at cost. Intangible assets with finite useful lives are amortized over the useful life that the assets are expected to contribute directly or indirectly to future cash flows. Intangible assets are amortized using an accelerated method based on the pattern in which the economic benefits of the assets are consumed. The Company reviews the carrying value and useful lives of its intangible assets with definite lives whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable or the period over which they should be amortized has changed. When indicators of impairment exist, the Company determines whether the estimated undiscounted sum of the future cash flows of such assets is less than their carrying amounts. If less, an impairment loss is recognized in the amount, if any, by which the carrying amount of such assets exceeds their respective fair values. The Company evaluates the remaining useful life of each intangible asset that is being amortized during each reporting period to determine whether events and circumstances warrant a revision to the remaining period of amortization. If the estimate of the intangible asset’s remaining useful life has changed, the remaining carrying amount of the intangible asset is amortized prospectively over that revised remaining useful life. During the three months ended September 30, 2022, the Company noted that indicators of impairment existed and prepared an undiscounted cash flow analysis, which indicated, for the Stendra® product an impairment. The Company then prepared a discounted cash flow analysis through December 2029, representing the remaining economic useful life for the Stendra® product resulting in an impairment of approximately $7.5 million. The Company has determined that no impairment existed as of December 31, 2021. As indicators of impairment exist as of December 31, 2022, the Company prepared an undiscounted cash flow analysis. This analysis includes projections of future revenue and expenses, which if not achieved could result in future impairment charges. These projections include continued significant sales growth based in part on expectation of higher sales volume resulting from increased product availability as a result of the Vivus settlement. Additionally, the Company is planning to invest in research and development pursuant to our Non-Prescription / Over-The-Counter ("OTC") Strategies related to Stendra®, which we anticipate will dramatically increase product sales in the future, such that if our Stendra OTC strategy is not successful, we may have to partially or fully impair the remaining intangible balance. The Company’s prepared projections including the undiscounted cash flows of the remaining estimated useful lives through December 2031 for the medical device products. Based on the impairment assessment as of December 31, 2022, and 2021, the Company determined that no intangible asset impairment occurred as the undiscounted cash flows exceeded the respective carrying values of the assets. Fixed Assets Fixed assets consist of furniture and fixtures. Furniture and fixtures are recorded at cost, less accumulated depreciation, and are depreciated on a straight-line basis over its estimated useful life. The Company uses an estimated useful life of 7 years for furniture and fixtures. Depreciation expense for each of the years ended December 31, 2022 and 2021 was $10,220. Leases The Company accounts for leases in accordance with Accounting Standards Codification (“ASC”) Topic 842. Topic 842 requires organizations to recognize leased assets and liabilities on the balance sheet. The standard also requires disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leases. The Company determines if an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified fixed asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to obtain substantially all of the economic benefits from using the underlying asset. The Company has lease agreements that include lease and non-lease components, which the Company accounts for as a single lease component for all leases. Operating lease right-of-use (“ROU”) assets are included in other assets whereas operating lease liabilities are included in other current liabilities and other long-term liabilities on the Company’s consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The operating lease payments are recognized as lease expense on a straight-line basis over the lease term. Lease payments included in the measurement of the lease liability are comprised of fixed payments. Variable lease payments associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented in the Company’s consolidated statements of operations in the same line item as expense arising from fixed lease payments for operating leases. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet and the Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company applies this policy to all underlying asset categories. Topic 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The lease term for all of the Company’s leases includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor. See Note 15 Commitments and Contingencies for additional information. Deferred Financing Costs Costs incurred to issue debt are deferred and presented in the consolidated balance sheets as a direct reduction from the carrying amount of the debt liability, consistent with debt discounts. Related amortization expense is recorded as a component of interest expense over the term of the related debt using the effective interest rate method. Stock-Based Compensation The Company accounts for stock-based awards to employees and consultants in accordance with applicable accounting principles, which requires compensation expense related to stock-based transactions, including employee stock options and consultant warrants, to be measured and recognized in the financial statements based on a determination of the fair value of the stock options or warrants. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. Employee stock option and consulting expenses are recognized over the employee’s or consultant’s requisite service period (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the volatility and expected term. Any changes in these highly subjective assumptions can significantly impact stock-based compensation expense. See Note 10 Stock Options. Costs of Equity Transactions Incremental direct costs incurred to issue shares of the Company’s preferred and common stocks are recorded as a reduction of the related proceeds. Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize deferred tax assets in the future in excess of its net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. As of December 31, 2022 and 2021, the Company has recorded a full valuation allowance against its deferred tax assets. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. As of December 31, 2022 and 2021, no accrued interest or penalties are recorded in the consolidated balance sheet. Contingencies The Company may be subject to various patent challenges, product liability claims, government investigations and other legal proceedings in the ordinary course of business. Legal fees and other expenses related to litigation are expensed as incurred and included in general and administrative expenses in the consolidated statements of operations. Shipping Costs The Company records the costs of shipping related to prescription medication sales in general and administrative expense in its consolidated statements of operations. There were no shipping costs for the years ended December 31, 2022 and 2021. Shipping costs related to medical devices are recorded as revenue and subsequently deducted as a component of cost of goods sold in the consolidated statements of operations. Shipping costs for the years ended December 31, 2022 and 2021 were $125,368 and $134,730, respectively. Basic and Diluted Net Loss per Common Share The Company computes basic net loss per common share by dividing net loss applicable to common stockholders by the weighted average number of shares of common stocks outstanding during the period, excluding the anti-dilutive effects of stock options and warrants to purchase common stocks. The Company computes diluted net loss per common stock by dividing the net loss applicable to common stocks by the sum of the weighted-average number of common stocks outstanding during the period plus the potential dilutive effects of its convertible preferred stocks, stock options and warrants to purchase common stocks, but such items are excluded if their effect is anti-dilutive. Because the impact of these items is anti-dilutive during periods of net loss, there was no difference between the Company’s basic and diluted net loss per stock of common stock for the years ended December 31, 2022 and 2021. See Note 12 Basic and Diluted Net Loss per Common Share. Recent Accounting Pronouncements Pending Adoption as of December 31, 2022 In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments companies to estimate expected credit losses when measuring certain financial assets, including accounts receivables. The new guidance is effective for fiscal years beginning after December 15, 2022. The Company is adopting the new guidance with its fiscal year beginning January 1, 2023. |
Accounts Receivable, net
Accounts Receivable, net | 12 Months Ended |
Dec. 31, 2022 | |
Accounts Receivable, net | |
Accounts Receivable, net | 3) Accounts Receivable, net Accounts receivable, net is comprised of the following: December 31, December 31, 2022 2021 Gross accounts receivables $ 2,757,839 $ 3,363,827 Distribution service fees (339,094) (371,310) Chargebacks accruals (1,960) — Cash discount allowances (99,671) (159,446) Allowance for doubtful accounts (206,868) (377,685) Total accounts receivable, net $ 2,110,246 $ 2,455,386 For the year ended December 31, 2022, gross billings to customers representing 10% or more of the Company’s total gross billings included four customers which represented approximately 26%, 21%, 17%, and 16% of total gross billings. For the year ended December 31, 2021, gross billings to customers representing 10% or more of the Company’s total gross billings included five customers which represented approximately 27%, 22%, 16%, 13% and 11% of total gross billings. Receivables from customers representing 10% or more of the Company’s gross accounts receivable included two customers at December 31, 2022 equal to 43%, and 16%, respectively, of the Company’s total gross accounts receivables. Receivables from customers representing 10% or more of the Company’s gross accounts receivable included three customers at December 31, 2021 equal to 40%, 19% and 15% of the Company’s total gross accounts receivables. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2022 | |
Inventories | |
Inventories | 4) Inventories Inventory is comprised of the following: December 31, 2022 December 31, 2021 Raw materials $ 1,574,683 $ 359,741 Finished goods 240,430 159,908 Total inventory $ 1,815,113 $ 519,649 Finished goods are net of valuation reserves of $364,300 and $383,298 as of December 31, 2022 and 2021, respectively. Raw materials are net of valuation reserves of $2,872,977 as of December 31, 2022 and 2021, which is related to bulk inventory. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Dec. 31, 2022 | |
Prepaid Expenses and Other Current Assets | |
Prepaid Expenses and Other Current Assets | 5) Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets are comprised of the following: December 31, 2022 December 31, 2021 Prepaid insurance $ 109,414 $ 73,223 Prepaid FDA fees — 831,179 Prepaid coupon fees 71,500 71,500 API purchase commitment asset (see Note 13) 663,984 1,419,538 Due from wholesalers — 609,059 Other prepaid expenses 333,158 605,422 Other current assets 138,226 110,167 Total prepaid expenses and other current assets $ 1,316,282 $ 3,720,088 |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets | |
Intangible Assets | 6) Intangible Assets Balance at December 31, 2020 $ 32,160,919 Amortization expense (6,867,770) Balance at December 31, 2021 25,293,149 Amortization expense (5,588,665) Intangible Impairment (7,460,000) Balance at December 31, 2022 $ 12,244,484 The future annual amortization related to the Company’s intangible assets is as follows as of December 31, 2022: 2023 $ 3,272,746 2024 2,800,623 2025 1,754,328 2026 1,442,186 2027 1,212,871 Thereafter 1,761,730 Total $ 12,244,484 The intangible assets held by the Company are the Stendra® product, Timm Medical product, and PTV product and are being amortized over their estimated useful lives of 10 years, 12 years, and 12 years, respectively. The carrying value of the Stendra® product, Timm Medical product, and PTV product as of December 31, 2022 are $7.2 million, $4.0 million and $1.1 million, respectively. The carrying value of the Stendra® product, Timm Medical product, and PTV product as of December 31, 2021 were $19.1 million, $4.9 million and $1.4 million, respectively. During the three months ended September 30, 2022, the Company determined that the intangible asset related to the Stendra® product was impaired resulting in an impairment charge of approximately $7.5 million. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2022 | |
Accrued Expenses | |
Accrued Expenses | 7) Accrued Expenses Accrued expenses are comprised of the following: December 31, 2022 December 31, 2021 Accrued price protection (see Note 13) $ — $ 1,853,979 Accrued product returns 2,311,647 6,192,845 Accrued contract rebates 279,018 379,242 Due to Vivus (see Note 13) — 2,267,523 Due to 3PL/Wholesalers 155,081 479,178 Accrued bonuses 427,500 527,563 Accrued professional fees 51,620 125,392 Other accrued expenses 409,796 131,662 Total accrued expenses $ 3,634,662 $ 11,957,384 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt | |
Debt | 8) Debt Promissory Note In connection with the Settlement Agreement entered into with Vivus (see Note 13), Petros executed an interest-bearing promissory note (the “Note”) in favor of Vivus in the principal amount of $10,201,758. The parties also entered into a Security Agreement to secure Petros’ obligations under the Note. Under the terms of the Note, the original principal amount of $10,201,758 is payable in consecutive quarterly installments of principal and interest beginning on April 1, 2022 through January 1, 2027. Interest on the principal amount will accrue at a rate of 6% per year. The Company may prepay the Note, in whole or in part, at any time, with no premium or penalty. In the event that the Company defaults under the Security Agreement, all principal outstanding under the Note at the time of the default will bear interest at a rate of 9% per year until the full and final payment of all principal and interest under the Note (regardless of whether any default is waived or cured). Pursuant to the Security Agreement, dated January 18, 2022, the Company granted to Vivus a continuing security interest in all of its Stendra® API and products and its rights under the License Agreement. Future minimum principal payments of the promissory note are as follows: 2023 $ 1,089,683 2024 1,530,729 2025 2,720,940 2026 3,264,351 2027 872,073 Total $ 9,477,776 Senior Debt The Company did not have any senior indebtedness as of December 31, 2022 and 2021. On September 30, 2016, the Company entered into a loan agreement with Hercules, a third party, for a $35 million term loan (“Senior Debt”) with a stated interest rate of the greater of either (i) Prime plus 7.25% or (ii) 10.75%. The Senior Debt included an additional Paid-In-Kind (“PIK”) interest that increased the outstanding principal on a monthly basis at an annual rate of 1.35% and a $787,500 end of term charge. On November 22, 2017, the Company amended its loan agreement with Hercules (“First Amendment”). A covenant was added, in which the Company must achieve a certain minimum EBITDA, as defined, target for the trailing twelve-month period, ending June 30, 2018. The end of term charge was increased from $787,500 to $1,068,750. The minimum EBITDA for each of the trailing six months and the fixed charge coverage ratio (1:1 to 0.9:1) were reduced. The Company was also required to prepay $10,000,000 in principal. On April 13, 2020, the Company amended its loan agreement with Hercules. The amendment waived all financial covenant defaults for all periods since inception through the period ending March 31, 2020. The amendment also included the following changes: ● Removed the Adjusted EBITDA and Fixed Cost Coverage Ratio Covenants. ● Extended the maturity date from October 1, 2020 to April 2021, which was further extendable to December 1, 2021 upon achieving the Financing Milestone, as defined in the agreement. ● Increased the cash interest rate from the greater of (a) 10.75% or (b) 10.75% plus the US WSJ Prime minus 4.50% to the greater of (a) 11.50% or (b) 11.50% plus the US WSJ Prime minus 4.25% . ● Removed the PIK interest rate. ● Removed the prepayment penalty. The end of term charge of $1,068,750 was partially extended with $534,375 paid on October 1, 2020 and $534,375 due on February 1, 2021. Effective September 30, 2020, the Company and Hercules entered into the Third Amendment to Loan and Security Agreement (“Third Amendment”) to provide for interest only payments commencing on October 1, 2020 and continuing through December 22, 2020 unless the Company raised net cash proceeds of at least $25 million through an equity or debt financing or other transaction on or before December 21, 2020. The Third Amendment also amended the minimum cash, minimum net revenue and minimum EBITDA financial covenants. On that same date, Juggernaut Capital Partners III, L.P., Hercules and Wells Fargo Bank, N.A. entered into an escrow agreement (the “Escrow Agreement”) to escrow funds amounting to approximately $1.5 million, an amount equal to the aggregate of certain principal payments due under the Loan Agreement, as amended. In connection with the consummation of the Mergers, the funds held in escrow were disbursed back to Juggernaut Capital Partners III, L.P. and the Escrow Agreement was terminated. The Company satisfied the maturity date extension requirement pursuant to funds retained upon the closing of the Mergers in December 2020. As a result, the Senior Debt had a maturity date of December 1, 2021 and was repaid in total as of December 31, 2021. Interest expense on the Senior Debt was $368,660 for the year ended December 31, 2021. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2022 | |
Stockholders' Equity | |
Stockholders' Equity | 9) Stockholders’ Equity On January 26, 2021, 500 shares of the Company’s Preferred Stock were converted into 6,061 shares of the Company’s common stock. Effective January 1, 2021, the Company entered into a Marketing and Consulting Agreement (the "CorIRAgreement") with CorProminence, LLC (the "Consultant") for certain shareholder information and relation services. The term of the CorIRAgreement is for one year with automatic consecutive one-year renewal terms. As consideration for the shareholder information and relation services, the Company will pay the Consultant a monthly retainer of $7,500 and issued 3,000 restricted shares of the Company's common stock to the Consultant on March 24, 2021 (the "CorIR Grant Date"). The restricted shares vested immediately on the CorIR Grant Date. Effective April 1, 2021, the Company entered into a Consulting and Advisory Agreement (the "King Agreement") with Tania King, an employee of Juggernaut Capital Partners LLP, for certain services. The term of the King Agreement is indefinite but may be terminated by either party, with or without cause. As consideration for the consulting and advisory services, the Company will pay Ms. King a monthly fee of $4,000, an additional $12,000 payment included with the first monthly fee for services provided since January 1, 2021, and issue restricted stock units for shares of the Company's common stock ("RSU's") with a cash value of $72,000 as of the date of the grant (the "King Grant Date"). The RSU's shall vest and settle in full on the one-year anniversary of the King Grant Date. Effective June 4, 2021, the Company entered into a Service Agreement with IRTH Communications, LLC ("ITRH") for certain investor relations services (the "IRTH Agreement"). The term of the IRTH Agreement is for one year with an optional one-year renewal term. As consideration for the services, the Company will pay IRTH a fixed fee of $6,750 per month for the term of the IRTH Agreement and issued 2,834 restricted shares of the Company's common stock with a value of $90,002 as of the date of the grant (the "IRTH Grand Date"). The restricted shares vest immediately on the IRTH Agreement Grant Date. The agreement was terminated effective June 30, 2022. Contingent Consideration Pursuant to the Merger Agreement, each security holder of Metuchen received a right to receive such security holder’s pro rata stock of an aggregate of 1,423,209 shares of Petros Common Stock potentially issuable upon the achievement of certain milestones set forth in the Merger Agreement. The milestones are for the achievement of stock price and market capitalization, as defined over a two-year period. Market Capitalization/Gross Proceeds Earnout Payments In connection with the Mergers, each security holder of Metuchen received an equity classified earnout consideration to be paid in the form of Petros Common Stock if the Closing Price (as defined in the Merger Agreement) per share of stock of Petros’ Common Stock equals or exceeds certain milestones set forth in the Merger Agreement, as discussed below. Each milestone earnout payment was only achievable and payable one time and upon attainment of such milestone earnout payment. In no event will the sum of the milestone earnout payments be greater than 400,000 shares of Petros Common Stock. As of December 31, 2022, the milestones have not been achieved and the earnout expired on December 2, 2022. In connection with the Mergers, each security holder of Metuchen received the right to receive earnout consideration, which is liability classified, to be paid in the form of Petros Common Stock if either Petros’ Market Capitalization (as defined in the Merger Agreement) or Petros receives aggregate gross proceeds that equals or exceeds certain milestones set forth in the Merger Agreement. Each milestone earnout payment is only achievable and payable one time and upon attainment of such milestone. In no event will the sum of the milestone earnout payments be greater than 1,023,209 shares of Petros Common Stock. As of December 31, 2022 and 2021, the milestones have not been achieved. The fair value of the derivative liability was $0.0 and $0.5 million as of December 31, 2022 and December 31, 2021, respectively. For the years ended December 31, 2022 and 2021, the Company recognized gains on revaluation of derivative liabilities of $0.5 million and $9.4 million, respectively. |
Stock Options and Restricted St
Stock Options and Restricted Stock Units ("RSU's") | 12 Months Ended |
Dec. 31, 2022 | |
Stock Options and Restricted Stock Units ("RSU's") | |
Stock Options and Restricted Stock Units ("RSU's") | 10) Stock Options and Restricted Stock Units (“RSUs”) The Company established the 2020 Omnibus Incentive Compensation plan (the “2020 Plan”) which provides for the grants of awards to our directors, officers, employees, and consultants. The 2020 Plan authorizes the grant of incentive stock options, nonqualified stock options, stock appreciation rights, stock awards, stock units and other stock-based awards and cash-based awards. On December 22, 2021, our stockholders approved the Second Amendment to the 2020 Plan to increase the total number of shares of common stock issuable under the 2020 Plan by 152,166 shares to a total of 260,000 shares of common stock. As of December 31, 2022, there were 260,000 shares authorized and 158,364 shares available for issuance under the 2020 Plan. Upon the consummation of the Mergers as disclosed in Note 1, Neurotrope options issued and outstanding as of December 1, 2020 were converted into equivalent options to purchase stocks of Petros common stock and were adjusted to give effect to the Exchange Ratio set forth in the Merger Agreement. The following is a summary of stock options for the period from January 1, 2021 through December 31, 2021 and for the year ended December 31, 2022: Weighted-Average Aggregate Intrinsic Weighted-Average Remaining Contractual Value Number of Shares Exercise Price Term (Years) ($ in thousands) Options outstanding at December 31, 2020 57,433 $ 514.30 0.9 $ — Options granted 61,567 33.80 9.23 — Less: options expired/cancelled (57,433) (514.30) — — Options outstanding at December 31, 2021 61,567 $ 33.80 9.23 $ — Options granted 5,000 33.40 9.01 — Less: options forfeited (7,500) (32.10) — — Options outstanding at December 31, 2022 59,067 $ 34.02 8.29 $ — Options exercisable at December 31, 2022 50,675 $ 33.77 8.31 $ — The following is a summary of RSUs for the year ended December 31, 2022: Weighted-Average Aggregate Intrinsic Weighted-Average Remaining Contractual Value Number of Shares Exercise Price Term (Years) ($in thousands) RSUs outstanding at December 31, 2020 — $ — — $ — RSUs granted 11,642 32.90 9.84 — Less: RSUs forfeited — — — — Less: RSUs expired/cancelled — — — — Less: RSUs exercised — — — — RSUs outstanding at December 31, 2021 11,642 $ 32.90 9.84 $ — RSUs granted 30,927 11.90 9.27 — Less: RSUs forfeited — — — — Less: RSUs expired/cancelled — — — — Less: RSUs exercised (2,331) (30.90) — — RSUs outstanding at December 31, 2022 40,238 $ 16.87 9.20 $ — RSUs exercisable at December 31, 2022 9,311 $ 33.40 8.98 $ — On February 19, 2021, Fady Boctor, the President and Chief Commercial Officer of the Company, was granted an option to purchase 21,567 shares of the Company’s common stock at an exercise price of $37.40 per share. The option vested 50% as of February 19, 2021, the date of grant, and the remainder shall vest in equal installments on the first and second anniversary thereof. On April 8, 2021, in connection with the Directors' appointment to the Board upon the Company becoming an independent publicly traded company on December 1, 2020, the Company awarded each of the five Directors an initial grant of options (the "Initial Grant") to purchase 5,000 shares of common stock of the Company at an exercise price of $31.80 per share. The shares of common stock underlying the options vested 25% on the date of grant, 25% shall vest upon the six-month four one year On May 11, 2021, the Company granted to certain officers of the Company options to purchase 15,000 shares of common stock of the Company at an exercise price or $32.10 per share. The shares of common stock underlying the options vested 30% on the date of grant, 30% shall vest upon the one year anniversary of the date of the grant, and the remainder shall vest upon the two year anniversary of the date of the grant. On January 4, 2022, pursuant to a consulting agreement, the Company awarded a grant of 5,000 options to purchase shares of common stock of the Company at an exercise price of $33.40 per share. The shares of common stock underlying the options vested 100% upon issuance. On April 7, 2022, the Company awarded the four Directors grants of 24,876 total RSUs with a stock price of $11.90 per share. The RSUs shall vest 100% on the one-year one-year Stock-based compensation expense recognized for the years ended December 31, 2022 and 2021, was $1,195,076 and $1,305,150, respectively, and is recorded in general and administrative expenses in the consolidated statements of operations. |
Common Stock Warrants
Common Stock Warrants | 12 Months Ended |
Dec. 31, 2022 | |
Common Stock Warrants | |
Common Stock Warrants | 11) Common Stock Warrants The following is a summary of warrants for the year ended December 31, 2022: Number of Shares Warrants outstanding at December 31, 2020 441,041 Warrants issued 785,356 Warrants exercised (201,459) Warrants expired (20,823) Warrants outstanding at December 31, 2021 1,004,115 Warrants issued --- Warrants exercised ---- Warrants expired ---- Warrants outstanding at December 31, 2022 1,004,115 As of December 31, 2022, the Company’s warrants by expiration date were as follows: Number of Warrants Exercise Price Expiration Date 278 16.00 August 23, 2023 2,279 356.50 June 1, 2024 7,492 218.50 June 17, 2024 1,997 312.50 June 19, 2024 2,279 265.50 September 1, 2024 1,050 127.40 September 16, 2024 2,279 43.00 December 1, 2024 2,800 56.50 March 2, 2025 2,800 73.00 June 1, 2025 2,800 55.00 September 1, 2025 2,800 47.05 December 1, 2025 222,189 75.00 December 1, 2025 90,880 175.00 December 1, 2025 62,429 512.50 December 1, 2025 15,856 1,250.00 December 1, 2025 175,132 17.15 October 18, 2026 233,775 35.00 December 12, 2026 175,000 35.00 December 27, 2026 1,004,115 |
Basic and Diluted Net Loss per
Basic and Diluted Net Loss per Common Share | 12 Months Ended |
Dec. 31, 2022 | |
Basic and Diluted Net Loss per Common Share | |
Basic and Diluted Net Income (Loss) per Common Share | 12) Basic and Diluted Net Loss per Common Share The following is a reconciliation of the weighted average number of common shares outstanding used in calculating basic and diluted net loss per share: For the Years Ended December 31, 2022 2021 Numerator Net loss $ (20,037,573) $ (8,986,676) Denominator Weighted-average common shares for basic and diluted net loss per unit 2,070,210 1,088,977 Basic and diluted net loss per common share $ (9.68) $ (8.25) The following table summarizes the potentially dilutive securities convertible into common shares that were excluded from the calculation of diluted net loss per share because their inclusion would have been antidilutive: For the Years Ended December 31, 2022 2021 Stock options 59,067 61,567 RSUs 40,238 11,642 Warrants 1,004,115 1,004,115 Total 1,103,420 1,077,324 |
Marketing, Licensing and Distri
Marketing, Licensing and Distribution Agreements | 12 Months Ended |
Dec. 31, 2022 | |
Marketing, Licensing and Distribution Agreements. | |
Marketing, Licensing and Distribution Agreements | 13) Marketing, Licensing and Distribution Agreements (a) Vivus On September 30, 2016, the Company entered into a License and Commercialization Agreement (the “License Agreement”) with Vivus, Inc (“Vivus”) to purchase and receive the license for the commercialization and exploitation of Stendra® for a one-time fee of $70 million. The License Agreement gives the Company the right to sell Stendra® in the U.S and its territories, Canada, South America, and India. In December 2000, Vivus originally was granted the license from Mitsubishi Tanabe Pharma Corporation (“MTPC”) to develop, market, and manufacture Stendra®. Stendra® was approved by the Food and Drug Administration (“FDA”) in April 2012 to treat male erectile dysfunction. Under the License Agreement, the Company will pay MTPC a royalty of 5% on the first $500 million of net sales and 6% of net sales thereafter. In consideration for the trademark assignment and the use of the trademarks associated with the product and the Vivus technology, the Company shall (a) during the first, second, and third years following the expiration of the Royalty Period in a particular country in the Company’s territory, pay to Vivus a royalty equal to 2% of the net sales of products in such territory; and (b) following the fourth and fifth years following the end of the Royalty Period in such territory, pay to Vivus a royalty equal to 1% of the net sales of products in such territory. Thereafter, no further royalties shall be owed with respect to net sales of Stendra® in such territory. In addition, the Company will be responsible for a pro-rata portion of a $6 million milestone payment to be paid once $250 million in sales has been reached on the separate revenue stream of Stendra®. Should the $250 million of sales threshold be reached, the Company will be responsible for $3.2 million of the milestone payment. In connection with the License Agreement, the Company and Vivus also entered into a Supply Agreement on the effective date of the License Agreement, which has since been terminated, effective September 30, 2021. On January 18, 2022, Petros and Vivus entered into a Settlement Agreement (the “Vivus Settlement Agreement”) related to the minimum purchase requirements under the Vivus Supply Agreement in 2018, 2019 and 2020 and certain reimbursement rights asserted by a third-party retailer in connection with quantities of the Company’s Stendra® product that were delivered to the third-party retailer and later returned. In connection with the Vivus Settlement Agreement, Petros retained approximately $7.3 million of Active Pharmaceutical Ingredient (“API”) inventory under the Vivus Supply Agreement. In exchange for the API and reduction of current liabilities after prepayment of $900,000, Petros executed an interest-bearing promissory note (the “Note”) in favor of Vivus in the principal amount of $10,201,758, which the Company believes approximates fair value (See Note 8). In addition to the payments to be made in accordance with the Note, the Company further agreed in the Vivus Settlement Agreement to (i) grant to Vivus a right of first refusal to provide certain types of debt and convertible equity (but not preferred equity) until the Note is paid in full, and (ii) undertake to make certain regulatory submissions to effectuate Vivus’ ability to exercise its rights under the License Agreement. On January 18, 2022, the Company made a prepayment of the obligations under the Note in the amount of $900,000, and a payment of $1,542,904 with respect to a purchase order made in 2021 to Vivus. In consideration of these payment and upon the Company’s satisfaction of certain regulatory submissions Vivus released 100% of the quantity of bulk Stendra® tablets by the end of the first quarter 2022. As a result of entering into the Vivus Settlement Agreement, the Company decreased accrued expenses by $6.5 million and decreased accrued inventory purchases by $14.2 million; which were partially offset by a decrease in API purchase commitments of $6.2 million and an increase to liabilities for the Note of $10.2 million (which is net of the $0.9 million prepayment on the Note). As a result, the Company recorded a $3.4 million gain on settlement. As of December 31, 2022 and 2021, the Company has $0.0 and $14.2 million, respectively, of accrued inventory purchases related to the Company’s minimum purchase obligations with Vivus for raw material or API inventory. API inventory is not a finished good. The Company has $0.3 million of API inventory which it has title to and is classified as raw materials inventory. The additional API inventory that the Company does not have title to is classified as API Inventory in either other current assets or other assets, depending on whether the Company expects to take title to the product within one year from the date of the financial statements. As of December 31, 2022 and 2021, there was $0.7 million and $1.4 million respectively included in other current assets (see Note 5 Prepaid and Other Current Assets). As of December 31, 2022 and 2021, there was $5.1 million and $11.0 million included as other assets on the accompanying consolidated balance sheets, respectively. The Company reviews its inventory levels and purchase commitments for excess amounts that it is required to purchase but projects it will not be able to sell prior to product expiry. The Company did not record any reserve for the years ended December 31, 2022 and 2021. During the years ended December 31, 2022 and 2021, the Company incurred royalties to MTPC for Stendra(R) of $136,732 and $221,221, respectively. Royalties incurred were included in cost of goods sold in the consolidated statements of operations. As of December 31, 2022, the Company had a receivable for royalties of $106,115, which is included in other current assets in prepaid expenses and other current assets (see Note 5 Prepaid and Other Current Assets). As of December 31, 2021, the Company had a receivable for royalties of $81,136, which is included in other current assets in prepaid expenses and other current assets in the accompanying consolidated balance sheets. The license agreement between MTPC and Vivus (“MTPC License”) contains certain termination rights that would allow MTPC to terminate the agreement if Vivus were to breach any of the terms of the MTPC License or become insolvent or bankrupt. In the event that MTPC terminates the MTPC License with Vivus because of any contractual breach the Company has step-in rights with MTPC, which would allow the Company to continue to sell Stendra®. (b) Patheon Following the termination of the Vivus Supply Agreement, Petros, through its subsidiary Metuchen, entered into a Technology Transfer Service Agreement on January 20, 2022 with Patheon Pharmaceuticals Inc., part of Thermo Fisher Scientific (“Patheon”), pursuant to which the Company and Patheon agreed to collaborate as strategic partners for commercial production of Stendra® tablets at Patheon’s facilities in Cincinnati, Ohio. Under the Agreement, Patheon or one of its affiliates will provide pharmaceutical development and technology transfer services in order to establish and validate its ability to manufacture supply of the Company’s Stendra® product. Any commercial sale of product manufactured during the performance of the Agreement must be subject to a subsequent commercial manufacturing services agreement (with associated quality agreement) between the parties before it can be offered for commercial sale. (c) Hybrid In March 2020, the Company acquired the exclusive license to H100™ from Hybrid. H100™ is a topical candidate with at least one active ingredient and potentially a combination of ingredients responsible for the improvement of penile curvature during the acute phase of Peyronie’s disease.The Company paid an initial license fee of $100,000, with an additional $900,000 payment due upon obtainment of orphan indication for H100™ and termination of Hybrid’s existing agreement with a compounding pharmacy, and additional annual payments of $125,000, $150,000 and $200,000 due on each of the first, second and third anniversaries of the license agreement and $250,000 annual payments due thereafter. The Company is also required to make a $1,000,000 payment upon first commercial sale and a sliding scale of percentage payments on net sales in the low single digits. Annual anniversary payments will not be required after commercialization. The Company is also obligated to make royalty payments between 3-6% of any net sales. In addition, the Company may terminate at any time after first anniversary, without cause, upon ninety (90) days’ notice. The Company has treated the acquisition as an asset acquisition and has concluded that the asset acquired and the upfront payment should be expensed as it was considered an IPR&D asset with no alternative future uses. On September 24, 2020, the Company and Hybrid entered into a letter agreement, pursuant to which the term of the license agreement was extended for an additional six months to March 24, 2021. In consideration for the extension, the Company paid Hybrid $50,000 in October 2020 and an additional $100,000 in December 2020. On March 31, 2021, the Company and Hybrid, entered into a second letter agreement, pursuant to which the parties agreed to extend the Second Period (as defined in the Hybrid License) for an additional six (6) months to September 24, 2021. Additionally, the Company agreed to pay Hybrid a one-time, non-creditable and non-refundable payment of $200,000, which was paid within seven |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies | |
Commitments and Contingencies | 14) Commitments and Contingencies (a) Legal Proceedings On July 14, 2020, Greg Ford, the Chief Executive Officer of the Company, was terminated. On July 14, 2020, Mr. Ford, through his attorney, claimed that he was entitled to severance pay pursuant to an employment agreement following the termination of his employment on that same date. This claim is currently at an early stage where the Company is unable to determine the likelihood of any unfavorable outcome. The Company is not currently involved in any other significant claims or legal actions that, in the opinion of management, will have a material adverse impact on the Company’s operations, financial position or cash flows. (b) Operating Leases The Company has commitments under operating leases for office and warehouse space used in its operations. The Company’s leases have remaining lease terms ranging from 1.7 years to 4.0 years. On November 30, 2021, the Company entered into a sublease with respect to its entire headquarters facility. The sublessor delivered a $14,000 security deposit to the Company on the lease commencement date and also agreed to pay $7,000 per month for the term beginning January 10, 2022 and continuing until the expiration of the head lease on August 30, 2024. The Company accounts for this sublease as an operating lease in accordance with the lessor accounting guidance within ASC 842. The components of lease expense consisted entirely of fixed lease costs related to operating leases. These costs were $179,246 and $179,246 for the years ended December 31, 2022 and 2021, respectively. Fixed lease costs for the year ended December 31, 2022 were offset by sublease income of $84,000. Supplemental balance sheet information related to leases was as follows: As of December 31, 2022 As of December 31, 2021 Operating lease ROU asset: Other assets $ 358,471 $ 475,557 Operating lease liability: Other current liabilities $ 142,340 $ 125,579 Other long-term liabilities 262,677 405,018 Total operating lease liability $ 405,017 $ 530,597 Supplemental lease term and discount rate information related to leases was as follows: As of December 31, 2022 As of December 31, 2021 Weighted-average remaining lease terms - operating leases 2.7 years 3.7 years Weighted-average discount rate - operating leases 12.6 % 12.6 % Supplemental cash flow information related to leases was as follows: For the Years Ended December 31, 2022 2021 Operating cash flows from operating leases $ 187,739 $ 184,239 Future minimum lease payments under non-cancelable leases as of December 31, 2022 were as follows: Lease Liability Maturity Analysis Operating Leases 2023 $ 189,374 2024 155,242 2025 81,107 2026 82,324 Thereafter — Total lease payments 508,047 Less: Imputed Interest (103,030) Total $ 405,017 Future minimum sublease income under non-cancelable leases as of December 31, 2022, were as follows: Sublease income Operating Leases 2023 $ 84,000 2024 56,000 Total $ 140,000 As of December 31, 2022, the Company had no operating leases that had not yet commenced. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 15) Income Taxes The current and deferred income tax expense (benefit) for the years ended December 31, 2022 and 2021 is as follows: For the Years Ended December 31, 2022 2021 Current expense (benefit): Federal $ — $ — State — — Total current expense (benefit) — — Deferred expense (benefit): Federal — — State — — Total deferred expense (benefit) — — Total income tax expense (benefit) $ — $ — A reconciliation of the Company’s statutory income tax rate to the Company’s effective income tax rate is as follows: For the Years Ended December 31, 2022 2021 Income at US statutory rate 21.00 % 21.00 % State taxes, net of federal benefit 1.56 % (0.61) % Permanent differences 0.48 % 22.31 % Valuation allowance (23.98) % (55.55) % Adjustment to opening deferrals - short period 0.00 % 5.42 % Other (0.08) % 7.43 % Effective income tax rate 0.00 % 0.00 % Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2022 and December 31, 2021 are as follows: For the Years Ended December 31, 2022 2021 Accruals $ 229,348 $ 186,739 Intangible assets (818,127) (1,006,954) Depreciation and amortization 7,379,214 5,669,065 Expenses not currently deductible 1,140,594 815,108 Net operating loss carryforwards 6,013,400 3,702,789 Interest expense limitation 226,588 96,920 Stock-based compensation 2,882,814 2,716,370 Valuation allowance (17,053,830) (12,180,037) Total deferred tax asset (liability) $ — $ — The Company assesses the need for a valuation allowance related to its deferred income tax assets by considering whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. A valuation allowance has been recorded against the Company’s deferred income tax assets, as it is in the opinion of management that it is more likely than not that the net operating loss carryforwards (“NOL”) will not be utilized in the foreseeable future. The $4,873,793 increase to the valuation allowance from December 31, 2021, to December 31, 2022, is primarily due to the generation of federal and state NOLs. It is the opinion of management that it is more likely than not that the NOLs generated will not be utilized in the foreseeable future. The cumulative valuation allowance as of December 31, 2022 is $17 million, which will be reduced if and when the Company determines that the deferred income tax assets are more likely than not to be realized. As of December 31, 2022, the Company’s estimated aggregate total NOLs were $27.4 million for U.S. federal purposes with an indefinite life due to regulations set forth in the Tax Cuts and Jobs Act of 2017 (“TCJA”). The future utilization of the NOLs are limited to 80% of taxable income. The aggregate total NOLs are presented before Internal Revenue Code, Section 382 limitations (“Section 382”). The Tax Reform Act of 1986 imposed substantial restrictions on the utilization of NOL and tax credits in the event of an ownership change of a corporation. Thus, the Company's ability to utilize all such NOL and credit carryforwards may be limited. The Company files its tax returns in the U.S. federal jurisdiction, as well as in various state and local jurisdictions. The Company is not currently under audit in any taxing jurisdictions. The federal statute of limitations for audit consideration is 3 years from the filing date, and generally states implement a statute of limitations between 3 The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations for both federal taxes and the many states in which we operate or do business in. ASC 740 states that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, on the basis of the technical merits. The Company records uncertain tax positions as liabilities in accordance with ASC 740 and adjust these liabilities when our judgment changes as a result of the evaluation of new information not previously available. Because of the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from our current estimate of the unrecognized tax benefit liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information is available. As of December 31, 2022, the Company has not recorded any uncertain tax positions in its consolidated financial statements. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. As of December 31, 2022, no accrued interest or penalties are included on the related tax liability line in the consolidated balance sheet. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, was enacted and signed into law, and GAAP requires recognition of the tax effects of new legislation during the reporting period that includes the enactment date. The CARES Act, among other things, includes changes to the tax provisions that benefits business entities and makes certain technical corrections to the 2017 Tax Cuts and Jobs Act, including, permitting net operating losses, or NOLs, carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021. In addition, the CARES Act allows NOLs incurred in 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes. The CARES Act provides other reliefs and stimulus measures. We have evaluated the impact of the CARES Act, and do not expect that any provision of the CARES Act would result in a material cash benefit to us or have a material impact on our financial statements or internal controls over financial reporting. Provision enacted in the TCJA related to the capitalization for tax purposes of research and experimental expenditures became effective on January 1, 2022. This provision requires us to capitalize research and experimental expenditures and amortize them on the U.S. tax return over five or fifteen years, depending on where the research is conducted. This provision is not expected to have a material impact on our calendar year 2022 effective tax rate on a net basis or our cash paid for taxes due to our net operating loss position. |
Defined Contribution Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2022 | |
Defined Contribution Plan | |
Defined Contribution Plan | 16) Defined Contribution Plan The Company has a qualified defined contribution plan under Section 401(k) of the Internal Revenue Code covering eligible employees. Eligible employees can contribute to the defined contribution plan, subject to certain limitations, on a pre-tax basis. The Company matches up to 100% of the first 6% of each employee’s contribution and is recognized as expense in general and administrative expenses on the consolidated statement of operations. Employer contributions were $51,276 and $57,543 for the years ended December 31, 2022 and 2021, respectively. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2022 | |
Segment Information | |
Segment Information | 17) Segment Information The Company manages its operations through two segments. The Company’s two segments, Prescription Medications and Medical Devices, focus on the treatment of male erectile dysfunction. The Prescription Medications segment consists primarily of operations related to Stendra®, which is sold generally in the United States, and H100™ for the treatment of Peyronie’s disease. The Medical Devices segment consists primarily of operations related to vacuum erection devices, which are sold domestically and internationally. The Company separately presents the costs associated with certain corporate functions as Corporate, primarily consisting of unallocated operating expenses including costs that were not specific to a particular segment but are general to the group, expenses incurred for administrative and accounting staff, general liability and other insurance, professional fees and other similar corporate expenses. Interest and other income (expense), net is also not allocated to the operating segments. The Company’s results of operations by reportable segment for the year ended December 31, 2022 are summarized as follows: Prescription Medical For the Year Ended December 31, 2022 Medications Devices Corporate Consolidated Net sales $ 2,734,639 $ 3,257,415 $ — $ 5,992,054 Cost of goods sold 949,197 1,340,221 — 2,289,418 Selling, general and administrative expenses 4,947,466 1,685,678 5,576,018 12,209,162 Gain on settlement with Vivus (3,389,941) — — (3,389,941) Research and development expenses 1,541,714 198,566 — 1,740,280 Depreciation and amortization expense 4,442,922 1,155,962 — 5,598,884 Intangible asset impairment 7,460,000 — — 7,460,000 Change in fair value of derivative liability — — (460,000) (460,000) Interest income (14,194) — — (14,194) Interest expense, promissory note — — 596,018 596,018 Net loss $ (13,202,525) $ (1,123,012) $ (5,712,036) $ (20,037,573) The Company’s results of operations by reportable segment for the year ended December 31, 2021 are summarized as follows: Prescription Medical For the year ended December 31, 2021 Medications Devices Corporate Consolidated Net sales $ 4,605,043 $ 3,206,221 $ — $ 7,811,264 Cost of goods sold 577,795 1,021,771 — 1,599,566 Selling, general and administrative expenses 6,473,482 2,620,403 6,499,348 15,593,233 Research and development expenses 1,788,491 — — 1,788,491 Depreciation and amortization expense 5,564,499 1,313,491 — 6,877,990 Change in fair value of derivative liability — — (9,430,000) (9,430,000) Interest expense, senior debt — — 368,660 368,660 Net loss $ (9,799,224) $ (1,749,444) $ 2,561,992 $ (8,986,676) The following table reflects net sales by geographic region for the years ended December 31, 2022 and 2021: For the Years Ended December 31, Net sales 2022 2021 United States $ 4,799,132 $ 6,572,849 International 1,192,922 1,238,415 $ 5,992,054 $ 7,811,264 No individual country other than the United States accounted for 10% of total sales for the year ended December 31, 2022 and 2021. The Company’s assets by reportable segment and reconciliation of segment assets to consolidated assets as of December 31, 2022 are summarized as follows: Prescription Medications Medical Devices Consolidated Intangible assets, net $ 7,178,704 $ 5,065,780 $ 12,244,484 Total segment assets $ 25,831,048 $ 6,590,166 $ 32,421,214 The Company’s assets by reportable segment and reconciliation of segment assets to consolidated assets as of December 31, 2021 are summarized as follows: Prescription Medications Medical Devices Consolidated Intangible assets, net $ 19,071,407 $ 6,221,742 $ 25,293,149 Total segment assets $ 59,657,514 $ 7,732,544 $ 67,390,058 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Use of Estimates | Use of Estimates The preparation of Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the Consolidated Financial Statements and reported amounts of revenue and expenses during the reporting periods. Such estimates include the adequacy of accounts receivable reserves, return reserves, inventory reserves, assessment of long-lived assets, including intangible asset impairment, and the valuation of the derivative liability, among others. Actual results could differ from these estimates and changes in these estimates are recorded when known. |
Risks and Uncertainties | Risks and Uncertainties The Company is subject to risks common to companies in the pharmaceutical industry including, but not limited to, uncertainties related to commercialization of competitor products, regulatory approvals, dependence on key products, dependence on key customers and suppliers, and protection of intellectual property rights. The World Health Organization (“WHO”) declared the coronavirus (“COVID-19”) a global pandemic on March 11, 2020, and since that time many of the previously imposed restrictions and other measures which were instituted in response have been subsequently reduced or lifted. However, the COVID-19 pandemic remains highly unpredictable and dynamic, and its duration and extent continue to be dependent on various developments, such as the emergence of variants to the virus that may cause additional strains of COVID-19. Accordingly, the COVID-19 pandemic may continue to have negative effects on the health of the U.S. economy for the foreseeable future. The Company cannot reasonably estimate the length or severity of the impact that the COVID-19 pandemic, including the emergence of any new variants will have on its financial results, and the Company may experience a material adverse impact on its sales, results of operations, and cash flows in fiscal 2023 and beyond . During 2020, government regulations and the voluntary business practices of the Company and prescribing physicians had prevented in-person visits by sales representatives to physicians’ offices. The Company had taken steps to mitigate the negative impact on its businesses of such restrictions. In March 2020, the Company reduced our sales representative head count to reflect the lack of in-person visits. The Company has maintained a core sales team which continued to contact physicians via telephone and videoconference as well as continuing to have webinars provided by the Company’s key opinion leaders to other physicians and pharmacists. In response to the spread of COVID-19, in March 2020, the Company closed its administrative offices. In January 2022, the Company sub-leased its Manalapan, New Jersey office and all administrative employees are working remotely for the foreseeable future. The Company has fully resumed in-person interactions by its customer-facing personnel in compliance with any local and state restrictions. The Company also continues to engage with customers virtually as the Company seeks to continue to support healthcare professionals and patient care. Since the beginning of the COVID-19 pandemic, we have experienced a shift from in-person sales to online, telehealth-based sales. These online sales generally have lower gross margins than in-person sales, which has impacted our net revenues. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that subject the Company to concentrations of credit risk includes cash. The Company maintains cash on deposit at U.S.-based banks in amounts which, at times, may be in excess of insured limits. |
Segment Reporting | Segment Reporting Operating segments are components of a Company for which separate financial information is available and evaluated regularly by the chief operating decision maker in assessing performance and deciding how to allocate resources. The Company’s two segments, Prescription Medications and Medical Devices, focus on the treatment of male erectile dysfunction. The Prescription Medications segment consists primarily of operations related to Stendra®, which is sold generally in the United States, and H100™ for the treatment of Peyronie’s disease. The Medical Devices segment consists primarily of operations related to vacuum erection devices, which are sold domestically and internationally. See Note 18 Segment Reporting. |
Revenue Recognition | Revenue Recognition Prescription Medication Sales The Company’s prescription medication sales consist of sales of Stendra® in the U.S. for the treatment of male erectile dysfunction. Under Accounting Standards Codification (“ASC”) Topic 606, Revenue Recognition In determining the transaction price, a significant financing component does not exist since the timing from when the Company delivers Stendra® to when the customers pay for the product is typically less than one year. The Company records prescription medication sales net of any variable consideration, including but not limited to discounts, rebates, returns, chargebacks, and distribution service fees (“DSA”). The Company uses the expected value method when estimating its variable consideration, unless terms are specified within contracts. The identified variable consideration is recorded as a reduction of revenue at the time revenues from sales of Stendra® are recognized. The Company recognizes revenue to the extent that it is probable that a significant revenue reversal will not occur in a future period. These estimates may differ from actual consideration received. The Company evaluates these estimates each reporting period to reflect known changes. As of December 31, 2022 and 2021, the reserves for sales deductions were $3.0 million and $4.7 million, respectively. The most significant sales deductions included in this reserve relate to returns, contract rebates, and DSA fees. Our estimates are based on factors such as our direct and indirect customers’ buying patterns and the estimated resulting contractual deduction rates, historical experience, specific known market events and estimated future trends, current contractual and statutory requirements, industry data, estimated customer inventory levels, current contract sales terms with our direct and indirect customers, and other competitive factors. Significant judgment and estimation is required in developing the foregoing and other relevant assumptions. The most significant sales deductions are further described below. Product Returns Consistent with industry practice, the Company maintains a return policy that generally allows its customers to return Stendra® and receive credit for product within six months prior to expiration date and up to one year after expiration date. The provision for returns is based upon the Company’s estimates for future Stendra® returns and historical experience. The provision of returns is part of the variable consideration recorded at the time revenue is recognized. As of December 31, 2022 and 2021, the reserves for product returns were $2.3 million and $3.8 million, respectively, and are included as a component of accrued expenses. During the years ended December 31, 2022 and December 2021, respectively, the Company recorded $9.4 million and $8.3 million of returns as a reduction of gross revenue. Contract Rebates, Coupon Redemptions and DSA Fees The Company establishes contracts with wholesalers, chain stores, and indirect customers that provide for rebates, sales incentives, DSA fees and other allowances. Some customers receive rebates upon attaining established sales volumes. Direct rebates are generally rebates paid to direct purchasing customers based on a percentage applied to a direct customer’s purchases from us, including fees paid to wholesalers under our DSAs, as described below. Indirect rebates are rebates paid to indirect customers that have purchased our products from a wholesaler under a contract with us. The Company has entered into DSAs with certain of our significant wholesaler customers that obligate the wholesalers, in exchange for fees paid by us, to: (i) manage the variability of their purchases and inventory levels within specified limits based on product demand and (ii) provide us with specific services, including the provision of periodic retail demand information and current inventory levels for our pharmaceutical products held at their warehouse locations. See Note 3. Accounts Receivable, net for further discussion of these reserves. Medical Device Sales The Company’s medical device sales consist of domestic and international sales of men’s health products for the treatment of erectile dysfunction. The men’s health products do not require a prescription and include Vacuum Erection Devices, PreBoost, VenoSeal, penile injections (Rx), and urinary tract infection tests. Under Topic 606, the Company recognizes revenue from medical device sales when its performance obligations with its customers have been satisfied. In the contracts with its customers, the Company has identified a single performance obligation to provide medical devices upon receipt of a customer order. The performance obligation is satisfied at a point in time when the Company’s customers obtain control of the medical device, which is typically upon shipment. The Company invoices its customers after the medical devices have been shipped and invoice payments are generally due within 30 days of invoice date for domestic customers and 90 days for international customers. In determining the transaction price, a significant financing component does not exist since the timing from when the Company delivers the medical devices to when the customers pay for the product is typically less than one year. The Company records medical device sales net of any variable consideration, including but not limited to returns. The Company uses the expected value method when estimating its variable consideration. The identified variable consideration is recorded as a reduction of revenue at the time revenues from the medical device sales are recognized. The Company recognizes revenue to the extent that it is probable that a significant revenue reversal will not occur in a future period. These estimates may differ from actual consideration received. The Company evaluates these estimates each reporting period to reflect known changes. Product Returns Consistent with industry practice, the Company maintains a return policy that generally allows its customers to return medical devices and receive credit for products within 90 days of the sale. The provision for returns is based upon the Company’s estimates for future product returns and historical experience. The Company has not made significant changes to the judgments made in applying Topic 606. As of December 31, 2022 and 2021, the reserves for product returns for medical devices were not significant. Contract Costs In relation to customer contracts, the Company incurs costs to fulfill a contract but does not incur costs to obtain a contract. These costs to fulfill a contract do not meet the criteria for capitalization and are expensed as incurred. As such, the Company did not have any contract assets at December 31, 2022 and 2021. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Certain assets and liabilities are carried at fair value under U.S. GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market. Level 3 — Unobservable inputs which are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. Financial instruments recognized at historical amounts in the consolidated balance sheets consist of cash, accounts receivable, other current assets, accounts payable, accrued expenses, and other current liabilities. The Company believes that the carrying values of cash, accounts receivable, other current assets, accounts payable, accrued expenses, note payable, and other current liabilities approximate their fair values due to the short-term nature of these instruments. In connection with the Mergers in December 2020, each security holder of Metuchen received an earnout consideration classified as a derivative liability to be paid in the form of Petros Common Stock. The Company estimated their fair value using a Monte Carlo Simulation approach. This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement within the fair value hierarchy. The fair value of the derivative liability as of December 31, 2022 and 2021 was $0 million and $0.5 million, respectively. See Note 9 Stockholders’ Equity. |
Accounts Receivable, net | Accounts Receivable, net The Company extends credit to its customers in the normal course of business. Accounts receivable are recorded at the invoiced amount, net of chargebacks, distribution service fees, and cash discounts. Management determines each allowance based on historical experience along with the present knowledge of potentially uncollectible accounts. See Note 3 Accounts Receivable, net. |
Inventories | Inventories Inventories consist of finished goods held for sale and raw materials. Inventories are stated at the lower of cost or net realizable value, with cost determined using the first-in, first-out method. Inventories are adjusted for excess and obsolescence. Evaluation of excess inventory includes such factors as expiry date, inventory turnover, and management’s assessment of current product demand. See Note 4 Inventories. |
Intangible Assets | Intangible Assets The Company accounts for recognized intangible assets at cost. Intangible assets with finite useful lives are amortized over the useful life that the assets are expected to contribute directly or indirectly to future cash flows. Intangible assets are amortized using an accelerated method based on the pattern in which the economic benefits of the assets are consumed. The Company reviews the carrying value and useful lives of its intangible assets with definite lives whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable or the period over which they should be amortized has changed. When indicators of impairment exist, the Company determines whether the estimated undiscounted sum of the future cash flows of such assets is less than their carrying amounts. If less, an impairment loss is recognized in the amount, if any, by which the carrying amount of such assets exceeds their respective fair values. The Company evaluates the remaining useful life of each intangible asset that is being amortized during each reporting period to determine whether events and circumstances warrant a revision to the remaining period of amortization. If the estimate of the intangible asset’s remaining useful life has changed, the remaining carrying amount of the intangible asset is amortized prospectively over that revised remaining useful life. During the three months ended September 30, 2022, the Company noted that indicators of impairment existed and prepared an undiscounted cash flow analysis, which indicated, for the Stendra® product an impairment. The Company then prepared a discounted cash flow analysis through December 2029, representing the remaining economic useful life for the Stendra® product resulting in an impairment of approximately $7.5 million. The Company has determined that no impairment existed as of December 31, 2021. As indicators of impairment exist as of December 31, 2022, the Company prepared an undiscounted cash flow analysis. This analysis includes projections of future revenue and expenses, which if not achieved could result in future impairment charges. These projections include continued significant sales growth based in part on expectation of higher sales volume resulting from increased product availability as a result of the Vivus settlement. Additionally, the Company is planning to invest in research and development pursuant to our Non-Prescription / Over-The-Counter ("OTC") Strategies related to Stendra®, which we anticipate will dramatically increase product sales in the future, such that if our Stendra OTC strategy is not successful, we may have to partially or fully impair the remaining intangible balance. The Company’s prepared projections including the undiscounted cash flows of the remaining estimated useful lives through December 2031 for the medical device products. Based on the impairment assessment as of December 31, 2022, and 2021, the Company determined that no intangible asset impairment occurred as the undiscounted cash flows exceeded the respective carrying values of the assets. |
Fixed Assets | Fixed Assets Fixed assets consist of furniture and fixtures. Furniture and fixtures are recorded at cost, less accumulated depreciation, and are depreciated on a straight-line basis over its estimated useful life. The Company uses an estimated useful life of 7 years for furniture and fixtures. Depreciation expense for each of the years ended December 31, 2022 and 2021 was $10,220. |
Leases | Leases The Company accounts for leases in accordance with Accounting Standards Codification (“ASC”) Topic 842. Topic 842 requires organizations to recognize leased assets and liabilities on the balance sheet. The standard also requires disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leases. The Company determines if an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified fixed asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to obtain substantially all of the economic benefits from using the underlying asset. The Company has lease agreements that include lease and non-lease components, which the Company accounts for as a single lease component for all leases. Operating lease right-of-use (“ROU”) assets are included in other assets whereas operating lease liabilities are included in other current liabilities and other long-term liabilities on the Company’s consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The operating lease payments are recognized as lease expense on a straight-line basis over the lease term. Lease payments included in the measurement of the lease liability are comprised of fixed payments. Variable lease payments associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented in the Company’s consolidated statements of operations in the same line item as expense arising from fixed lease payments for operating leases. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet and the Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company applies this policy to all underlying asset categories. Topic 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The lease term for all of the Company’s leases includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor. See Note 15 Commitments and Contingencies for additional information. |
Deferred Financing Costs | Deferred Financing Costs Costs incurred to issue debt are deferred and presented in the consolidated balance sheets as a direct reduction from the carrying amount of the debt liability, consistent with debt discounts. Related amortization expense is recorded as a component of interest expense over the term of the related debt using the effective interest rate method. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based awards to employees and consultants in accordance with applicable accounting principles, which requires compensation expense related to stock-based transactions, including employee stock options and consultant warrants, to be measured and recognized in the financial statements based on a determination of the fair value of the stock options or warrants. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. Employee stock option and consulting expenses are recognized over the employee’s or consultant’s requisite service period (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the volatility and expected term. Any changes in these highly subjective assumptions can significantly impact stock-based compensation expense. See Note 10 Stock Options. |
Costs of Equity Transactions | Costs of Equity Transactions Incremental direct costs incurred to issue shares of the Company’s preferred and common stocks are recorded as a reduction of the related proceeds. |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize deferred tax assets in the future in excess of its net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. As of December 31, 2022 and 2021, the Company has recorded a full valuation allowance against its deferred tax assets. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. As of December 31, 2022 and 2021, no accrued interest or penalties are recorded in the consolidated balance sheet. |
Contingencies | Contingencies The Company may be subject to various patent challenges, product liability claims, government investigations and other legal proceedings in the ordinary course of business. Legal fees and other expenses related to litigation are expensed as incurred and included in general and administrative expenses in the consolidated statements of operations. |
Shipping Costs | Shipping Costs The Company records the costs of shipping related to prescription medication sales in general and administrative expense in its consolidated statements of operations. There were no shipping costs for the years ended December 31, 2022 and 2021. Shipping costs related to medical devices are recorded as revenue and subsequently deducted as a component of cost of goods sold in the consolidated statements of operations. Shipping costs for the years ended December 31, 2022 and 2021 were $125,368 and $134,730, respectively. |
Basic and Diluted Net Loss per Common Share | Basic and Diluted Net Loss per Common Share The Company computes basic net loss per common share by dividing net loss applicable to common stockholders by the weighted average number of shares of common stocks outstanding during the period, excluding the anti-dilutive effects of stock options and warrants to purchase common stocks. The Company computes diluted net loss per common stock by dividing the net loss applicable to common stocks by the sum of the weighted-average number of common stocks outstanding during the period plus the potential dilutive effects of its convertible preferred stocks, stock options and warrants to purchase common stocks, but such items are excluded if their effect is anti-dilutive. Because the impact of these items is anti-dilutive during periods of net loss, there was no difference between the Company’s basic and diluted net loss per stock of common stock for the years ended December 31, 2022 and 2021. See Note 12 Basic and Diluted Net Loss per Common Share. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Pending Adoption as of December 31, 2022 In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments companies to estimate expected credit losses when measuring certain financial assets, including accounts receivables. The new guidance is effective for fiscal years beginning after December 15, 2022. The Company is adopting the new guidance with its fiscal year beginning January 1, 2023. |
Accounts Receivable, net (Table
Accounts Receivable, net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounts Receivable, net | |
Schedule of accounts receivable | December 31, December 31, 2022 2021 Gross accounts receivables $ 2,757,839 $ 3,363,827 Distribution service fees (339,094) (371,310) Chargebacks accruals (1,960) — Cash discount allowances (99,671) (159,446) Allowance for doubtful accounts (206,868) (377,685) Total accounts receivable, net $ 2,110,246 $ 2,455,386 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventories | |
Schedule of Inventories | December 31, 2022 December 31, 2021 Raw materials $ 1,574,683 $ 359,741 Finished goods 240,430 159,908 Total inventory $ 1,815,113 $ 519,649 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Prepaid Expenses and Other Current Assets | |
Schedule of Prepaid Expenses and Other Current Assets | December 31, 2022 December 31, 2021 Prepaid insurance $ 109,414 $ 73,223 Prepaid FDA fees — 831,179 Prepaid coupon fees 71,500 71,500 API purchase commitment asset (see Note 13) 663,984 1,419,538 Due from wholesalers — 609,059 Other prepaid expenses 333,158 605,422 Other current assets 138,226 110,167 Total prepaid expenses and other current assets $ 1,316,282 $ 3,720,088 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets | |
Schedule of intangible assets | Balance at December 31, 2020 $ 32,160,919 Amortization expense (6,867,770) Balance at December 31, 2021 25,293,149 Amortization expense (5,588,665) Intangible Impairment (7,460,000) Balance at December 31, 2022 $ 12,244,484 |
Schedule of future annual amortization related to the company's of intangible assets | 2023 $ 3,272,746 2024 2,800,623 2025 1,754,328 2026 1,442,186 2027 1,212,871 Thereafter 1,761,730 Total $ 12,244,484 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accrued Expenses | |
Schedule of accrued expenses | December 31, 2022 December 31, 2021 Accrued price protection (see Note 13) $ — $ 1,853,979 Accrued product returns 2,311,647 6,192,845 Accrued contract rebates 279,018 379,242 Due to Vivus (see Note 13) — 2,267,523 Due to 3PL/Wholesalers 155,081 479,178 Accrued bonuses 427,500 527,563 Accrued professional fees 51,620 125,392 Other accrued expenses 409,796 131,662 Total accrued expenses $ 3,634,662 $ 11,957,384 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt | |
Schedule of future principal payments of the promissory note | 2023 $ 1,089,683 2024 1,530,729 2025 2,720,940 2026 3,264,351 2027 872,073 Total $ 9,477,776 |
Stock Options and Restricted _2
Stock Options and Restricted Stock Units ("RSU's") (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stock Options and Restricted Stock Units ("RSU's") | |
Schedule of stock options | Weighted-Average Aggregate Intrinsic Weighted-Average Remaining Contractual Value Number of Shares Exercise Price Term (Years) ($ in thousands) Options outstanding at December 31, 2020 57,433 $ 514.30 0.9 $ — Options granted 61,567 33.80 9.23 — Less: options expired/cancelled (57,433) (514.30) — — Options outstanding at December 31, 2021 61,567 $ 33.80 9.23 $ — Options granted 5,000 33.40 9.01 — Less: options forfeited (7,500) (32.10) — — Options outstanding at December 31, 2022 59,067 $ 34.02 8.29 $ — Options exercisable at December 31, 2022 50,675 $ 33.77 8.31 $ — Weighted-Average Aggregate Intrinsic Weighted-Average Remaining Contractual Value Number of Shares Exercise Price Term (Years) ($in thousands) RSUs outstanding at December 31, 2020 — $ — — $ — RSUs granted 11,642 32.90 9.84 — Less: RSUs forfeited — — — — Less: RSUs expired/cancelled — — — — Less: RSUs exercised — — — — RSUs outstanding at December 31, 2021 11,642 $ 32.90 9.84 $ — RSUs granted 30,927 11.90 9.27 — Less: RSUs forfeited — — — — Less: RSUs expired/cancelled — — — — Less: RSUs exercised (2,331) (30.90) — — RSUs outstanding at December 31, 2022 40,238 $ 16.87 9.20 $ — RSUs exercisable at December 31, 2022 9,311 $ 33.40 8.98 $ — |
Common Stock Warrants (Tables)
Common Stock Warrants (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Common Stock Warrants | |
Summary of warrants | Number of Shares Warrants outstanding at December 31, 2020 441,041 Warrants issued 785,356 Warrants exercised (201,459) Warrants expired (20,823) Warrants outstanding at December 31, 2021 1,004,115 Warrants issued --- Warrants exercised ---- Warrants expired ---- Warrants outstanding at December 31, 2022 1,004,115 |
Schedule of warrants by expiration date | As of December 31, 2022, the Company’s warrants by expiration date were as follows: Number of Warrants Exercise Price Expiration Date 278 16.00 August 23, 2023 2,279 356.50 June 1, 2024 7,492 218.50 June 17, 2024 1,997 312.50 June 19, 2024 2,279 265.50 September 1, 2024 1,050 127.40 September 16, 2024 2,279 43.00 December 1, 2024 2,800 56.50 March 2, 2025 2,800 73.00 June 1, 2025 2,800 55.00 September 1, 2025 2,800 47.05 December 1, 2025 222,189 75.00 December 1, 2025 90,880 175.00 December 1, 2025 62,429 512.50 December 1, 2025 15,856 1,250.00 December 1, 2025 175,132 17.15 October 18, 2026 233,775 35.00 December 12, 2026 175,000 35.00 December 27, 2026 1,004,115 |
Basic and Diluted Net Loss pe_2
Basic and Diluted Net Loss per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Basic and Diluted Net Loss per Common Share | |
Schdule of weighted average number of common shares outstanding basic and diluted net loss per share | For the Years Ended December 31, 2022 2021 Numerator Net loss $ (20,037,573) $ (8,986,676) Denominator Weighted-average common shares for basic and diluted net loss per unit 2,070,210 1,088,977 Basic and diluted net loss per common share $ (9.68) $ (8.25) |
Schdule of potentially dilutive securities convertible into common shares | For the Years Ended December 31, 2022 2021 Stock options 59,067 61,567 RSUs 40,238 11,642 Warrants 1,004,115 1,004,115 Total 1,103,420 1,077,324 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies | |
Summary of supplemental balance sheet information related to leases | Supplemental balance sheet information related to leases was as follows: As of December 31, 2022 As of December 31, 2021 Operating lease ROU asset: Other assets $ 358,471 $ 475,557 Operating lease liability: Other current liabilities $ 142,340 $ 125,579 Other long-term liabilities 262,677 405,018 Total operating lease liability $ 405,017 $ 530,597 |
Summary of supplemental lease term and discount rate information related to leases | Supplemental lease term and discount rate information related to leases was as follows: As of December 31, 2022 As of December 31, 2021 Weighted-average remaining lease terms - operating leases 2.7 years 3.7 years Weighted-average discount rate - operating leases 12.6 % 12.6 % |
Summary of supplemental cash flow information related to leases | Supplemental cash flow information related to leases was as follows: For the Years Ended December 31, 2022 2021 Operating cash flows from operating leases $ 187,739 $ 184,239 |
Summary of future minimum lease payments under non-cancelable leases | Future minimum lease payments under non-cancelable leases as of December 31, 2022 were as follows: Lease Liability Maturity Analysis Operating Leases 2023 $ 189,374 2024 155,242 2025 81,107 2026 82,324 Thereafter — Total lease payments 508,047 Less: Imputed Interest (103,030) Total $ 405,017 |
Schedule of future minimum sublease income under non-cancelable leases | Future minimum sublease income under non-cancelable leases as of December 31, 2022, were as follows: Sublease income Operating Leases 2023 $ 84,000 2024 56,000 Total $ 140,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Summary of current and deferred income tax expense (benefit) | For the Years Ended December 31, 2022 2021 Current expense (benefit): Federal $ — $ — State — — Total current expense (benefit) — — Deferred expense (benefit): Federal — — State — — Total deferred expense (benefit) — — Total income tax expense (benefit) $ — $ — |
Summary of reconciliation of the Company's statutory income tax rate to the Company's effective income tax rate | For the Years Ended December 31, 2022 2021 Income at US statutory rate 21.00 % 21.00 % State taxes, net of federal benefit 1.56 % (0.61) % Permanent differences 0.48 % 22.31 % Valuation allowance (23.98) % (55.55) % Adjustment to opening deferrals - short period 0.00 % 5.42 % Other (0.08) % 7.43 % Effective income tax rate 0.00 % 0.00 % |
Summary of significant components of the Company's deferred tax assets and liabilities | For the Years Ended December 31, 2022 2021 Accruals $ 229,348 $ 186,739 Intangible assets (818,127) (1,006,954) Depreciation and amortization 7,379,214 5,669,065 Expenses not currently deductible 1,140,594 815,108 Net operating loss carryforwards 6,013,400 3,702,789 Interest expense limitation 226,588 96,920 Stock-based compensation 2,882,814 2,716,370 Valuation allowance (17,053,830) (12,180,037) Total deferred tax asset (liability) $ — $ — |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Information | |
Summary of results of operations by reportable segment | Prescription Medical For the Year Ended December 31, 2022 Medications Devices Corporate Consolidated Net sales $ 2,734,639 $ 3,257,415 $ — $ 5,992,054 Cost of goods sold 949,197 1,340,221 — 2,289,418 Selling, general and administrative expenses 4,947,466 1,685,678 5,576,018 12,209,162 Gain on settlement with Vivus (3,389,941) — — (3,389,941) Research and development expenses 1,541,714 198,566 — 1,740,280 Depreciation and amortization expense 4,442,922 1,155,962 — 5,598,884 Intangible asset impairment 7,460,000 — — 7,460,000 Change in fair value of derivative liability — — (460,000) (460,000) Interest income (14,194) — — (14,194) Interest expense, promissory note — — 596,018 596,018 Net loss $ (13,202,525) $ (1,123,012) $ (5,712,036) $ (20,037,573) Prescription Medical For the year ended December 31, 2021 Medications Devices Corporate Consolidated Net sales $ 4,605,043 $ 3,206,221 $ — $ 7,811,264 Cost of goods sold 577,795 1,021,771 — 1,599,566 Selling, general and administrative expenses 6,473,482 2,620,403 6,499,348 15,593,233 Research and development expenses 1,788,491 — — 1,788,491 Depreciation and amortization expense 5,564,499 1,313,491 — 6,877,990 Change in fair value of derivative liability — — (9,430,000) (9,430,000) Interest expense, senior debt — — 368,660 368,660 Net loss $ (9,799,224) $ (1,749,444) $ 2,561,992 $ (8,986,676) |
Summary of net sales by geographic region | For the Years Ended December 31, Net sales 2022 2021 United States $ 4,799,132 $ 6,572,849 International 1,192,922 1,238,415 $ 5,992,054 $ 7,811,264 |
Summary of assets by reportable segment and reconciliation of segment assets to consolidated assets | The Company’s assets by reportable segment and reconciliation of segment assets to consolidated assets as of December 31, 2022 are summarized as follows: Prescription Medications Medical Devices Consolidated Intangible assets, net $ 7,178,704 $ 5,065,780 $ 12,244,484 Total segment assets $ 25,831,048 $ 6,590,166 $ 32,421,214 The Company’s assets by reportable segment and reconciliation of segment assets to consolidated assets as of December 31, 2021 are summarized as follows: Prescription Medications Medical Devices Consolidated Intangible assets, net $ 19,071,407 $ 6,221,742 $ 25,293,149 Total segment assets $ 59,657,514 $ 7,732,544 $ 67,390,058 |
Nature of Operations, Basis o_2
Nature of Operations, Basis of Presentation, and Liquidity (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 07, 2020 |
Nature of Operations, Basis of Presentation, and Liquidity | |||
Cash in excess of certain limit, subject to adjustment as provided in the merger agreement | $ 20,000,000 | ||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Preferred stock, par value | $ 0.001 | ||
Metuchen Securityholders | |||
Nature of Operations, Basis of Presentation, and Liquidity | |||
Percentage of equity securities held | 51% |
Nature of Operations, Basis o_3
Nature of Operations, Basis of Presentation, and Liquidity - Additional information (Details) | 12 Months Ended | ||||
Nov. 30, 2020 | Dec. 31, 2022 USD ($) | Jan. 31, 2022 USD ($) | Jan. 18, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Nature of Operations, Basis of Presentation, and Liquidity | |||||
Reverse stock split ratio | 0.1 | ||||
Cash | $ 9,426,264 | $ 23,847,572 | |||
Working capital | 7,600,000 | ||||
Accumulated deficit | (90,726,393) | $ (70,688,820) | |||
Principal ownership amount | 10,201,758 | ||||
Principal balance | $ 9,477,776 | ||||
Minimum | |||||
Nature of Operations, Basis of Presentation, and Liquidity | |||||
Reverse stock split ratio | 0.25 | ||||
Maximum | |||||
Nature of Operations, Basis of Presentation, and Liquidity | |||||
Reverse stock split ratio | 0.1 | ||||
Vivus, Inc | Settlement Agreement | |||||
Nature of Operations, Basis of Presentation, and Liquidity | |||||
Principal ownership amount | $ 10,201,758 | ||||
Vivus, Inc | Settlement Agreement | Promissory Note | |||||
Nature of Operations, Basis of Presentation, and Liquidity | |||||
Principal ownership amount | $ 10,200,000 | $ 10,201,758 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | |
Summary of Significant Accounting Policies | ||
Number of operating segments | segment | 2 | |
Reserves for product returns | $ 2.3 | $ 3.8 |
Amount of returns | $ 9.4 | 8.3 |
Revenue practical expedient, financing component | true | |
Prescription Medications | ||
Summary of Significant Accounting Policies | ||
Reserves for sales deductions | $ 3 | $ 4.7 |
Medical Devices | ||
Summary of Significant Accounting Policies | ||
Right to return and receive credit for product | 90 days | |
Minimum | Prescription Medications | ||
Summary of Significant Accounting Policies | ||
Due period for invoice payments | 30 days | |
Right to return and receive credit for product | 6 months | |
Minimum | Medical Devices | Domestic customers | ||
Summary of Significant Accounting Policies | ||
Due period for invoice payments | 30 days | |
Maximum | Prescription Medications | ||
Summary of Significant Accounting Policies | ||
Due period for invoice payments | 75 days | |
Right to return and receive credit for product | 1 year | |
Maximum | Medical Devices | International customers | ||
Summary of Significant Accounting Policies | ||
Due period for invoice payments | 90 days |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Financial Liabilities Fair Value | |||
Fair value of the derivative liability | $ 0 | $ 500,000 | |
Impairment charge | 7,460,000 | ||
Accrued interest or penalties | 0 | 0 | |
Shipping costs | 0 | 0 | |
Stendra product | |||
Financial Liabilities Fair Value | |||
Impairment charge | $ 7,500,000 | 7,500,000 | |
Medical Devices | |||
Financial Liabilities Fair Value | |||
Shipping costs | $ 125,368 | 134,730 | |
Furniture and Fixtures | |||
Financial Liabilities Fair Value | |||
Estimated useful life (in years) | 7 years | ||
Depreciation expense | $ 10,220 | $ 10,220 |
Accounts Receivable, net (Detai
Accounts Receivable, net (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Accounts Receivable, net | ||
Gross accounts receivables | $ 2,757,839 | $ 3,363,827 |
Distribution service fees | (339,094) | (371,310) |
Chargebacks accruals | (1,960) | |
Cash discount allowances | (99,671) | (159,446) |
Allowance for doubtful accounts | (206,868) | (377,685) |
Total accounts receivable, net | $ 2,110,246 | $ 2,455,386 |
Accounts Receivable, net - Addi
Accounts Receivable, net - Additional information (Details) - customer | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Gross billings from customers | Customer concentration risk | ||
Accounts Receivable, net | ||
Number of customers | 4 | 5 |
Gross billings from customers | Customer concentration risk | One customers | ||
Accounts Receivable, net | ||
Concentration risk percentage | 26% | 27% |
Gross billings from customers | Customer concentration risk | Two customers | ||
Accounts Receivable, net | ||
Concentration risk percentage | 21% | 22% |
Gross billings from customers | Customer concentration risk | Three customers | ||
Accounts Receivable, net | ||
Concentration risk percentage | 17% | 16% |
Gross billings from customers | Customer concentration risk | Four customers | ||
Accounts Receivable, net | ||
Concentration risk percentage | 16% | 13% |
Gross billings from customers | Customer concentration risk | Five Customers | ||
Accounts Receivable, net | ||
Concentration risk percentage | 11% | |
Account receivables | Credit concentration risk | ||
Accounts Receivable, net | ||
Number of customers | 2 | 3 |
Account receivables | Credit concentration risk | One customers | ||
Accounts Receivable, net | ||
Concentration risk percentage | 43% | 40% |
Account receivables | Credit concentration risk | Two customers | ||
Accounts Receivable, net | ||
Concentration risk percentage | 16% | 19% |
Account receivables | Credit concentration risk | Three customers | ||
Accounts Receivable, net | ||
Concentration risk percentage | 15% |
Inventories (Details)
Inventories (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Inventories | ||
Raw Materials | $ 1,574,683 | $ 359,741 |
Finished goods | 240,430 | 159,908 |
Total inventory | $ 1,815,113 | $ 519,649 |
Inventories - Additional Inform
Inventories - Additional Information (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Inventories | ||
Finished goods are net of valuation reserves | $ 364,300 | $ 383,298 |
Raw materials are net of valuation reserves | $ 2,872,977 | $ 2,872,977 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Prepaid Expenses and Other Current Assets | ||
Prepaid insurance | $ 109,414 | $ 73,223 |
Prepaid FDA fees | 831,179 | |
Prepaid coupon fees | 71,500 | 71,500 |
API purchase commitment asset | 663,984 | 1,419,538 |
Due from wholesalers | 609,059 | |
Other prepaid expenses | 333,158 | 605,422 |
Other current assets | 138,226 | 110,167 |
Total prepaid expenses and other current assets | $ 1,316,282 | $ 3,720,088 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-lived Intangible Assets | ||
Balance | $ 25,293,149 | $ 32,160,919 |
Amortization expense | (5,588,665) | (6,867,770) |
Intangible Impairment | (7,460,000) | |
Balance | $ 12,244,484 | $ 25,293,149 |
Intangible Assets - Future annu
Intangible Assets - Future annual amortization (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Intangible Assets | |||
2023 | $ 3,272,746 | ||
2024 | 2,800,623 | ||
2025 | 1,754,328 | ||
2026 | 1,442,186 | ||
2027 | 1,212,871 | ||
Thereafter | 1,761,730 | ||
Total | $ 12,244,484 | $ 25,293,149 | $ 32,160,919 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Intangible Assets | ||||
Carrying value of intangible assets | $ 12,244,484 | $ 25,293,149 | $ 32,160,919 | |
Impairment charge | $ 7,460,000 | |||
Stendra product | ||||
Intangible Assets | ||||
Estimated useful lives of intangible assets | 10 years | |||
Carrying value of intangible assets | $ 7,200,000 | 19,100,000 | ||
Impairment charge | $ 7,500,000 | $ 7,500,000 | ||
Timm Medical product | ||||
Intangible Assets | ||||
Estimated useful lives of intangible assets | 12 years | |||
Carrying value of intangible assets | $ 4,000,000 | 4,900,000 | ||
PTV product | ||||
Intangible Assets | ||||
Estimated useful lives of intangible assets | 12 years | |||
Carrying value of intangible assets | $ 1,100,000 | $ 1,400,000 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Accrued Expenses | ||
Accrued price protection | $ 1,853,979 | |
Accrued product returns | $ 2,311,647 | 6,192,845 |
Accrued contract rebates | 279,018 | 379,242 |
Due to Vivus | 2,267,523 | |
Due to 3PL/Wholesalers | 155,081 | 479,178 |
Accrued bonuses | 427,500 | 527,563 |
Accrued professional fees | 51,620 | 125,392 |
Other accrued expenses | 409,796 | 131,662 |
Total accrued expenses | $ 3,634,662 | $ 11,957,384 |
Debt - Promissory Note (Details
Debt - Promissory Note (Details) | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Debt Instrument | |
Principal amount of notes payable | $ 10,201,758 |
Notes payable | |
Debt Instrument | |
Principal amount of notes payable | $ 10,201,758 |
Stated interest rate (in percent) | 6% |
Interest rate at the time of default (in percent) | 9% |
Debt - Future minimum principal
Debt - Future minimum principal payments (Details) | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Debt Instrument | |
Payment amount | $ 9,477,776 |
2023 | |
Debt Instrument | |
Payment amount | 1,089,683 |
2024 | |
Debt Instrument | |
Payment amount | 1,530,729 |
2025 | |
Debt Instrument | |
Payment amount | 2,720,940 |
2026 | |
Debt Instrument | |
Payment amount | 3,264,351 |
2027 | |
Debt Instrument | |
Payment amount | $ 872,073 |
Debt - Senior debt (Details)
Debt - Senior debt (Details) | 1 Months Ended | 3 Months Ended | |||||
Feb. 01, 2021 USD ($) | Apr. 13, 2020 | Nov. 22, 2017 USD ($) | Mar. 31, 2020 | Sep. 30, 2016 USD ($) | Dec. 31, 2022 USD ($) | Oct. 01, 2020 USD ($) | |
Debt Instrument | |||||||
Face amount of debt | $ 10,201,758 | ||||||
Senior debt | |||||||
Debt Instrument | |||||||
Face amount of debt | $ 1,068,750 | $ 35,000,000 | |||||
Stated interest rate (in percent) | 11.50% | 10.75% | 10.75% | ||||
Spread on variable rate | 4.25% | ||||||
Paid-In-Kind ("PIK") interest rate | 1.35% | ||||||
End of term fee paid | $ 534,375 | ||||||
End of term charge | 1,068,750 | $ 787,500 | $ 534,375 | ||||
Amount of principal prepaid | $ 10,000,000 | ||||||
Senior debt | Prime rate | |||||||
Debt Instrument | |||||||
Stated interest rate (in percent) | 7.25% | ||||||
Spread on variable rate | 4.50% | ||||||
Senior debt | Minimum | |||||||
Debt Instrument | |||||||
Fixed charge coverage ratio | 0.9 | ||||||
Senior debt | Maximum | |||||||
Debt Instrument | |||||||
Fixed charge coverage ratio | 1 |
Debt - Third Amendment (Details
Debt - Third Amendment (Details) - Senior debt $ in Millions | Sep. 30, 2020 USD ($) |
Debt Instrument | |
Required cash proceeds through an equity or debt financing or other transaction | $ 25 |
Escrow fund | $ 1.5 |
Debt - Interest Expenses (Detai
Debt - Interest Expenses (Details) | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Debt | |
Interest expense, senior debt | $ 368,660 |
Stockholders' Equity - Number o
Stockholders' Equity - Number of shares held (Details) - USD ($) | Jun. 04, 2021 | Apr. 01, 2021 | Jan. 26, 2021 | Jan. 01, 2021 |
Class of Stock | ||||
Renewal term of agreement | 1 year | |||
Marketing and Consulting Agreement | CorProminence, LLC | ||||
Class of Stock | ||||
Term of agreement | 1 year | |||
Monthly retainer amount | $ 7,500 | |||
Number of restricted shares issued | 3,000 | |||
Consulting and Advisory Agreement | Tania King | ||||
Class of Stock | ||||
Monthly retainer amount | $ 4,000 | |||
Additional payment included with the first monthly fee | 12,000 | |||
Restricted share cash value | $ 72,000,000 | |||
Service Agreement | ||||
Class of Stock | ||||
Term of agreement | 1 year | |||
Renewal term of agreement | 1 year | |||
Monthly retainer amount | $ 6,750 | |||
Restricted share cash value | $ 90,002 | |||
Number of restricted shares issued | 2,834 | |||
Common Stock | ||||
Class of Stock | ||||
Number of common stock issued upon conversion | 6,061 | |||
Preferred Stock | ||||
Class of Stock | ||||
Number of preferred stock converted | 500 |
Stockholders' Equity - Continge
Stockholders' Equity - Contingent Consideration (Details) | 12 Months Ended |
Dec. 31, 2022 shares | |
Stockholders' Equity | |
Common Stock potentially issuable upon the achievement of certain milestones | 1,423,209 |
Milestones term for achievement of stock price and market capitalization | 2 years |
Stockholders' Equity - Market C
Stockholders' Equity - Market Capitalization (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Collaborative Arrangement and Arrangement Other than Collaborative | ||
Fair value of the derivative liability | $ 0 | $ 0.5 |
Maximum | Metuchen | ||
Collaborative Arrangement and Arrangement Other than Collaborative | ||
Milestone earnout payments (in shares) | 400,000 | |
Market Capitalization/Gross Proceeds Earnout Payments | Metuchen | ||
Collaborative Arrangement and Arrangement Other than Collaborative | ||
Milestone earnout payments (in shares) | 500,000 | 9,400,000 |
Fair value of the derivative liability | $ 0 | $ 0.5 |
Market Capitalization/Gross Proceeds Earnout Payments | Maximum | Metuchen | ||
Collaborative Arrangement and Arrangement Other than Collaborative | ||
Milestone earnout payments (in shares) | 1,023,209 | 1,023,209 |
Stock Options and Restricted _3
Stock Options and Restricted Stock Units ('RSU's") (Details) - shares | Dec. 22, 2021 | Dec. 31, 2022 |
Stock Options and Restricted Stock Units ("RSU's") | ||
Number of shares authorized | 260,000 | |
Number of shares available for issuance | 158,364 | |
Number of shares increased for issuance | 152,166 | |
Number of shares available for issuance | 260,000 |
Stock Options and Restricted _4
Stock Options and Restricted Stock Units ("RSU's") (Details) - $ / shares | 12 Months Ended | |||||||
Apr. 07, 2022 | Jan. 04, 2022 | May 11, 2021 | Apr. 23, 2021 | Apr. 08, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Number of Shares | ||||||||
Options outstanding and exercisable on beginning | 61,567 | 57,433 | ||||||
Options granted | 5,000 | 15,000 | 5,000 | 61,567 | ||||
Less: options and RSU's forfeited | (7,500) | |||||||
Less: options and RSU's expired/cancelled | (57,433) | |||||||
Options and RSU's outstanding at the end | 59,067 | 61,567 | 57,433 | |||||
Options and RSU's exercisable at the end | 50,675 | |||||||
Weighted-Average Exercise Price | ||||||||
Options outstanding and exercisable at the beginning (in dollars per share) | $ 33.80 | $ 514.30 | ||||||
Options granted (in dollars per share) | $ 33.40 | $ 32.10 | 33.40 | 33.80 | ||||
Less: options forfeited (in dollars per share) | (32.10) | |||||||
Less: options expired/cancelled (in dollars per share) | 514.30 | |||||||
Options outstanding at the end (in dollars per share) | 34.02 | $ 33.80 | $ 514.30 | |||||
Options exercisable at the end (in dollars per share) | $ 33.77 | |||||||
Weighted-Average Remaining Contractual Term (Years) and Aggregate Intrinsic Value | ||||||||
Options outstanding and exercisable at the beginning (in years) | 8 years 3 months 14 days | 9 years 2 months 23 days | 10 months 24 days | |||||
Options granted (in years) | 9 years 3 days | 0 years | ||||||
Options outstanding at the end (in years) | 8 years 3 months 14 days | 9 years 2 months 23 days | 10 months 24 days | |||||
Options exercisable at the end (in years) | 8 years 3 months 21 days | |||||||
Restricted Stock Units | ||||||||
Number of Shares | ||||||||
Options outstanding and exercisable on beginning | 11,642 | |||||||
Options granted | 24,876 | 2,331 | 9,311 | 30,927 | 11,642 | |||
Less: options and RSU's exercised | (2,331) | |||||||
Options and RSU's outstanding at the end | 40,238 | 11,642 | ||||||
Options and RSU's exercisable at the end | 9,311 | |||||||
Weighted-Average Exercise Price | ||||||||
Options outstanding and exercisable at the beginning (in dollars per share) | $ 32.90 | |||||||
Options granted (in dollars per share) | $ 11.90 | $ 30.90 | 11.90 | $ 32.90 | ||||
Less: options exercised (in dollars per share) | (30.90) | |||||||
Options outstanding at the end (in dollars per share) | 16.87 | $ 32.90 | ||||||
Options exercisable at the end (in dollars per share) | $ 33.40 | |||||||
Weighted-Average Remaining Contractual Term (Years) and Aggregate Intrinsic Value | ||||||||
Options outstanding and exercisable at the beginning (in years) | 9 years 2 months 12 days | 9 years 10 months 2 days | ||||||
Options granted (in years) | 9 years 3 months 7 days | 9 years 10 months 2 days | ||||||
Options outstanding at the end (in years) | 9 years 2 months 12 days | 9 years 10 months 2 days | ||||||
Options exercisable at the end (in years) | 8 years 11 months 23 days |
Stock Options and Restricted _5
Stock Options and Restricted Stock Units (''RSU's'') - Fady Boctor, the President and Chief Commercial Officer (Details) (Imported) - $ / shares | 12 Months Ended | ||||
Jan. 04, 2022 | May 11, 2021 | Feb. 19, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of options granted | 5,000 | 15,000 | 5,000 | 61,567 | |
Exercise price | $ 33.40 | $ 32.10 | $ 33.40 | $ 33.80 | |
Vesting percentage | 100% | 30% | |||
Fady Boctor, the President and Chief Commercial Officer | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of options granted | 21,567 | ||||
Exercise price | $ 37.40 | ||||
Vesting percentage | 50% |
Stock Options and Restricted _6
Stock Options and Restricted Stock Units ("RSU's") - Additional Information (Details) | 12 Months Ended | ||||||
Apr. 07, 2022 director $ / shares shares | Jan. 04, 2022 $ / shares shares | May 11, 2021 $ / shares shares | Apr. 23, 2021 USD ($) $ / shares shares | Apr. 08, 2021 director $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) director $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Number of options granted | 5,000 | 15,000 | 5,000 | 61,567 | |||
Stock issued during period, value gross | $ | $ 296,000 | ||||||
Exercise price | $ / shares | $ 33.40 | $ 32.10 | $ 33.40 | $ 33.80 | |||
Vesting percentage | 100% | 30% | |||||
Stock-based compensation expense | $ | $ 1,195,076 | $ 1,305,150 | |||||
Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Number of directors to whom option is granted | director | 5 | 5 | |||||
Number of options granted | 24,876 | 2,331 | 9,311 | 30,927 | 11,642 | ||
Stock issued during period, value gross | $ | $ 72,000 | ||||||
Exercise price | $ / shares | $ 11.90 | $ 30.90 | $ 11.90 | $ 32.90 | |||
Vesting percentage | 100% | 100% | |||||
Vesting period | 1 year | 1 year | |||||
Share Based Compensation Arrangement By Share Based Payment Award Number Of Additional Shares Required | 310,894 | ||||||
Tania King [Member] | Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Number of options granted | 6,051 | ||||||
Exercise price | $ / shares | $ 11.90 | ||||||
Vesting percentage | 100% | ||||||
Vesting period | 1 year | ||||||
Vesting on the date of grant | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Vesting period | 1 year | ||||||
Vesting upon six-month anniversary of the date of grant | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Vesting percentage | 30% | ||||||
Vesting period | 2 years | ||||||
Directors | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Number of directors to whom option is granted | director | 4 | 5 | |||||
Number of options granted | 5,000 | ||||||
Exercise price | $ / shares | $ 31.80 | ||||||
Directors | Vesting on the date of grant | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Vesting percentage | 25% | ||||||
Directors | Vesting upon six-month anniversary of the date of grant | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Vesting percentage | 25% | ||||||
Vesting period | 6 months | ||||||
Directors | Vesting in equal installments over the following four fiscal quarters | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Vesting period | 4 months |
Common Stock Warrants - Summary
Common Stock Warrants - Summary of warrants (Details) | 12 Months Ended |
Dec. 31, 2021 shares | |
Common Stock Warrants | |
Warrants outstanding at the beginning | 441,041 |
Warrants issued | 785,356 |
Warrants exercised | (201,459) |
Warrants expired | (20,823) |
Warrants outstanding at the end | 1,004,115 |
Common Stock Warrants - Company
Common Stock Warrants - Company's warrants by expiration date (Details) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Class of Warrant or Right | |||
Number of Warrants | 1,004,115 | 1,004,115 | 441,041 |
Expiration Date of August 23, 2023 | |||
Class of Warrant or Right | |||
Number of Warrants | 278 | ||
Exercise Price | $ 16 | ||
Expiration Date of June 1, 2024 | |||
Class of Warrant or Right | |||
Number of Warrants | 2,279 | ||
Exercise Price | $ 356.50 | ||
Expiration Date of June 17, 2024 | |||
Class of Warrant or Right | |||
Number of Warrants | 7,492 | ||
Exercise Price | $ 218.50 | ||
Expiration Date of June 19, 2024 | |||
Class of Warrant or Right | |||
Number of Warrants | 1,997 | ||
Exercise Price | $ 312.50 | ||
Expiration Date of September 1, 2024 | |||
Class of Warrant or Right | |||
Number of Warrants | 2,279 | ||
Exercise Price | $ 265.50 | ||
Expiration Date of September 16, 2024 | |||
Class of Warrant or Right | |||
Number of Warrants | 1,050 | ||
Exercise Price | $ 127.40 | ||
Expiration Date of December 1, 2024 | |||
Class of Warrant or Right | |||
Number of Warrants | 2,279 | ||
Exercise Price | $ 43 | ||
Expiration Date of March 2, 2025 | |||
Class of Warrant or Right | |||
Number of Warrants | 2,800 | ||
Exercise Price | $ 56.50 | ||
Expiration Date of June 1, 2025 | |||
Class of Warrant or Right | |||
Number of Warrants | 2,800 | ||
Exercise Price | $ 73 | ||
Expiration Date of September 1, 2025 | |||
Class of Warrant or Right | |||
Number of Warrants | 2,800 | ||
Exercise Price | $ 55 | ||
Expiration Date of December 1, 2025, One | |||
Class of Warrant or Right | |||
Number of Warrants | 2,800 | ||
Exercise Price | $ 47.05 | ||
Expiration Date of December 1, 2025, Two | |||
Class of Warrant or Right | |||
Number of Warrants | 222,189 | ||
Exercise Price | $ 75 | ||
Expiration Date of December 1, 2025, Three | |||
Class of Warrant or Right | |||
Number of Warrants | 90,880 | ||
Exercise Price | $ 175 | ||
Expiration Date of December 1, 2025, Four | |||
Class of Warrant or Right | |||
Number of Warrants | 62,429 | ||
Exercise Price | $ 512.50 | ||
Expiration Date of December 1, 2025, Five | |||
Class of Warrant or Right | |||
Number of Warrants | 15,856 | ||
Exercise Price | $ 1,250 | ||
Expiration Date of October 18, 2026 | |||
Class of Warrant or Right | |||
Number of Warrants | 175,132 | ||
Exercise Price | $ 17.15 | ||
Expiration Date of December 12, 2026 | |||
Class of Warrant or Right | |||
Number of Warrants | 233,775 | ||
Exercise Price | $ 35 | ||
Expiration Date of December 27, 2026 | |||
Class of Warrant or Right | |||
Number of Warrants | 175,000 | ||
Exercise Price | $ 35 |
Basic and Diluted Net Loss pe_3
Basic and Diluted Net Loss per Common Share - Summary of Computation of Basic and Diluted Net Loss per Share (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Numerator | ||
Net loss | $ (20,037,573) | $ (8,986,676) |
Weighted average common shares outstanding | ||
Weighted-average common shares for basic net loss per unit | 2,070,210 | 1,088,977 |
Weighted-average common shares for diluted net loss per unit | 2,070,210 | 1,088,977 |
Basic net income (loss) per common share | $ (9.68) | $ (8.25) |
Diluted net income (loss) per common share | $ (9.68) | $ (8.25) |
Basic and Diluted Net Loss pe_4
Basic and Diluted Net Loss per Common Share - Summary of Potentially Dilutive Securities Convertible Into Common Shares Excluded from Calculation of Net Loss Per Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Basic and Diluted Net Loss per Common Share | ||
Total | 1,103,420 | 1,077,324 |
Stock Options | ||
Basic and Diluted Net Loss per Common Share | ||
Total | 59,067 | 61,567 |
RSUs | ||
Basic and Diluted Net Loss per Common Share | ||
Total | 40,238 | 11,642 |
Warrants | ||
Basic and Diluted Net Loss per Common Share | ||
Total | 1,004,115 | 1,004,115 |
Marketing, Licensing and Dist_2
Marketing, Licensing and Distribution Agreements - Vivus (Details) | 12 Months Ended | ||||
Sep. 30, 2016 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jan. 31, 2022 USD ($) | Jan. 18, 2022 USD ($) | |
Marketing, Licensing and Distribution Agreements | |||||
Principal amount of notes payable | $ 10,201,758 | ||||
Noncash decrease in accrued expenses related to Vivus settlement | (6,520,283) | ||||
Noncash decrease in API purchase commitment | 5,918,084 | $ 114,997 | |||
Noncash decrease in accrued inventory purchases related to Vivus Settlement | (14,203,905) | ||||
Gain on settlement with Vivus | 3,389,941 | ||||
API purchase commitment asset | 663,984 | 1,419,538 | |||
License Agreement | Royalty on the first $500 million of net sales | |||||
Marketing, Licensing and Distribution Agreements | |||||
Threshold net sales | 500,000,000 | ||||
License Agreement | Milestone payment to be paid once $250 million in sales has been reached | |||||
Marketing, Licensing and Distribution Agreements | |||||
Threshold net sales | 250,000,000 | ||||
Milestone payment | 6,000,000 | ||||
License Agreement | Milestone payment to be paid after $250 million in sales has been reached | |||||
Marketing, Licensing and Distribution Agreements | |||||
Threshold net sales | 250,000,000 | ||||
Milestone payment | $ 3,200,000 | ||||
License Agreement | Vivus, Inc | |||||
Marketing, Licensing and Distribution Agreements | |||||
One-time fee to purchase and receive the license for the commercialization and exploitation of Stendra | $ 70,000,000 | ||||
License Agreement | Vivus, Inc | Royalty during the first, second, and third years following the expiration of the Royalty Period | |||||
Marketing, Licensing and Distribution Agreements | |||||
Royalty percentage | 2% | ||||
License Agreement | Vivus, Inc | Royalty following the fourth and fifth years following the end of the Royalty Period | |||||
Marketing, Licensing and Distribution Agreements | |||||
Royalty percentage | 1% | ||||
License Agreement | MTPC | |||||
Marketing, Licensing and Distribution Agreements | |||||
Royalty incurred | $ 136,732 | 221,221 | |||
Royalty receivable | $ 106,115 | 81,136 | |||
License Agreement | MTPC | Royalty on the first $500 million of net sales | |||||
Marketing, Licensing and Distribution Agreements | |||||
Royalty percentage | 5% | ||||
License Agreement | MTPC | Royalty on net sales after $500 million | |||||
Marketing, Licensing and Distribution Agreements | |||||
Royalty percentage | 6% | ||||
Settlement Agreement | Vivus, Inc | |||||
Marketing, Licensing and Distribution Agreements | |||||
Inventory amount retained - API | $ 7,300,000 | ||||
Prepayment amount | 900,000 | ||||
Principal amount of notes payable | $ 10,201,758 | ||||
Noncash decrease in accrued expenses related to Vivus settlement | $ 6,500,000 | ||||
Noncash decrease in API purchase commitment | 6,200,000 | ||||
Noncash decrease in accrued inventory purchases related to Vivus Settlement | 14,200,000 | ||||
Payment made for purchase order | $ 1,542,904 | ||||
Percentage of stendra tablets released | 100 | ||||
Gain on settlement with Vivus | 3,400,000 | ||||
Accrued inventory purchases | 0 | 14,200,000 | |||
Raw materials inventory | 300,000 | ||||
Settlement Agreement | Vivus, Inc | Other Current Assets | |||||
Marketing, Licensing and Distribution Agreements | |||||
API purchase commitment asset | 700,000 | 1,400,000 | |||
Settlement Agreement | Vivus, Inc | Other Noncurrent Assets | |||||
Marketing, Licensing and Distribution Agreements | |||||
Accrued inventory purchases, other assets | 5,100,000 | $ 11,000,000 | |||
Settlement Agreement | Vivus, Inc | Promissory Note | |||||
Marketing, Licensing and Distribution Agreements | |||||
Prepayment amount | $ 900,000 | ||||
Principal amount of notes payable | $ 10,200,000 | $ 10,201,758 |
Marketing, Licensing and Dist_3
Marketing, Licensing and Distribution Agreements - Hybrid (Details) - Hybrid - USD ($) | 1 Months Ended | 12 Months Ended | ||||||||
Mar. 24, 2022 | Dec. 23, 2021 | Dec. 01, 2021 | Oct. 31, 2021 | Oct. 01, 2021 | Mar. 21, 2021 | Sep. 24, 2020 | Oct. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2020 | |
Exclusive license to H100 | ||||||||||
Marketing, Licensing and Distribution Agreements | ||||||||||
Initial license fee | $ 100,000 | |||||||||
Additional payment due upon obtainment of orphan indication for H100 | 900,000 | |||||||||
Annual payments due on first anniversary of the license agreement | 125,000 | |||||||||
Annual payments due on second anniversary of the license agreement | 150,000 | |||||||||
Annual payments due on third anniversary of the license agreement | 200,000 | |||||||||
Annual payments due after third anniversary of the license agreement | 250,000 | |||||||||
Payments upon first commercial sale and a sliding scale of percentage payments on net sales | $ 1,000,000 | |||||||||
Extension term of license agreement | 6 months | 6 months | ||||||||
Extension payment of license agreement | $ 50,000 | $ 100,000 | ||||||||
One-time, non-creditable and non-refundable payment | $ 200,000 | |||||||||
Threshold period for payments of one-time, non-creditable and non-refundable payment | 7 days | |||||||||
Exclusive license to H100 | Minimum | ||||||||||
Marketing, Licensing and Distribution Agreements | ||||||||||
Royalty percentage | 3% | |||||||||
Exclusive license to H100 | Maximum | ||||||||||
Marketing, Licensing and Distribution Agreements | ||||||||||
Royalty percentage | 6% | |||||||||
Amended license agreement of H100 | ||||||||||
Marketing, Licensing and Distribution Agreements | ||||||||||
Payment of License Fees | $ 150,000 | $ 200,000 | $ 200,000 | $ 200,000 | $ 150,000 |
Commitments and Contingencies -
Commitments and Contingencies - Operating Leases (Details) | Dec. 31, 2022 |
Minimum | |
Commitments and Contingencies | |
Remaining lease terms | 1 year 8 months 12 days |
Maximum | |
Commitments and Contingencies | |
Remaining lease terms | 4 years |
Commitments and Contingencies_2
Commitments and Contingencies - Additional information (Details) | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Commitments and Contingencies | |
Security deposit received for sublease | $ 14,000 |
Operating lease expense per month | 7,000 |
Operating leases that had not yet commenced | $ 0 |
Commitments and Contingencies_3
Commitments and Contingencies - Lease expense (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Lease Cost: | ||
Fixed lease cost | $ 179,246 | $ 179,246 |
Amount of fixed lease cost which are offset by sublease income | $ 84,000 |
Commitments and Contingencies_4
Commitments and Contingencies - Supplemental balance sheet (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Supplemental balance sheet information related to leases | ||
Operating lease ROU asset: Other assets | $ 358,471 | $ 475,557 |
Operating lease ROU asset | Other assets | Other assets |
Operating lease liability: | ||
Operating lease liability, current | $ 142,340 | $ 125,579 |
Other current liabilities | Other current liabilities | Other current liabilities |
Operating lease liability, noncurrent | $ 262,677 | $ 405,018 |
Other long-term liabilities | Other long-term liabilities | Other long-term liabilities |
Total operating lease liability | $ 405,017 | $ 530,597 |
Commitments and Contingencies_5
Commitments and Contingencies - Lease term and discount (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
Commitments and Contingencies | ||
Weighted-average remaining lease terms - operating leases | 2 years 8 months 12 days | 3 years 8 months 12 days |
Weighted-average discount rate - operating leases | 12.60% | 12.60% |
Commitments and Contingencies_6
Commitments and Contingencies - Supplemental cash flow information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Commitments and Contingencies | ||
Operating cash flows from operating leases | $ 187,739 | $ 184,239 |
Commitments and Contingencies_7
Commitments and Contingencies - Minimum lease payments (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Future minimum lease payments under non-cancelable leases | ||
2023 | $ 189,374 | |
2024 | 155,242 | |
2025 | 81,107 | |
2026 | 82,324 | |
Total lease payments | 508,047 | |
Less: Imputed Interest | (103,030) | |
Total operating lease liability | $ 405,017 | $ 530,597 |
Commitments and Contingencies_8
Commitments and Contingencies - Future Minimum Sublease Income (Details) | Dec. 31, 2022 USD ($) |
Sublease income | |
2023 | $ 84,000 |
2024 | 56,000 |
Total | $ 140,000 |
Income Taxes - Reconciliation (
Income Taxes - Reconciliation (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of the Company's statutory income tax rate to the Company's effective income tax rate | ||
Income at US statutory rate | 21% | 21% |
State taxes, net of federal benefit | 1.56% | (0.61%) |
Permanent differences | 0.48% | 22.31% |
Valuation allowance | (23.98%) | (55.55%) |
Adjustment to opening deferrals - short period | 0 | 5.42 |
Other | (0.08%) | 7.43% |
Effective income tax rate | 0% | 0% |
Income Taxes - Deferred tax ass
Income Taxes - Deferred tax assets and liabilities (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Significant components of the Company's deferred tax assets and liabilities | ||
Accruals | $ 229,348 | $ 186,739 |
Intangible assets | 818,127 | 1,006,954 |
Depreciation and amortization | 7,379,214 | 5,669,065 |
Expenses no currently deductible | 1,140,594 | 815,108 |
Net operating loss carryforwards | 6,013,400 | 3,702,789 |
Interest expense limitation | 226,588 | 96,920 |
Stock-based compensation | 2,882,814 | 2,716,370 |
Valuation allowance | $ (17,053,830) | $ (12,180,037) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes | ||
Cumulative valuation allowance | $ 17,053,830 | $ 12,180,037 |
NOLs | $ 27,400,000 | |
Percentage of future utilization of the NOLs | 80% | |
Accrued interest or penalties | $ 0 | $ 0 |
Increase to the valuation allowance | $ 4,873,793 | |
Maximum | ||
Income Taxes | ||
Statue of limitations period | 5 years | |
Minimum | ||
Income Taxes | ||
Statue of limitations period | 3 years |
Defined Contribution Plan (Deta
Defined Contribution Plan (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Defined Contribution Plan | ||
Employer matching contribution | 100% | |
Employer's contribution as a percentage of employee's gross pay | 6% | |
Employer contributions | $ 51,276 | $ 57,543 |
Segment Information (Details)
Segment Information (Details) | 12 Months Ended | |
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | |
Segment Information | ||
Number of operating segments | segment | 2 | |
Results of operations by reportable segment | ||
Net sales | $ 5,992,054 | $ 7,811,264 |
Cost of goods sold | 2,289,418 | 1,599,566 |
Selling, general and administrative expenses | 12,209,162 | 15,593,233 |
Gain on settlement with Vivus | (3,389,941) | |
Research and development expenses | 1,740,280 | 1,788,491 |
Depreciation and amortization expense | 5,598,884 | 6,877,990 |
Intangible asset impairment | 7,460,000 | |
Change in fair value of derivative liability | (460,000) | (9,430,000) |
Interest income | (14,194) | |
Interest expense, promissory note | 596,018 | 368,660 |
Net loss | $ (20,037,573) | (8,986,676) |
Operating segments | ||
Segment Information | ||
Number of operating segments | segment | 2 | |
Corporate | ||
Results of operations by reportable segment | ||
Selling, general and administrative expenses | $ 5,576,018 | 6,499,348 |
Change in fair value of derivative liability | (460,000) | (9,430,000) |
Interest expense, promissory note | 596,018 | 368,660 |
Net loss | (5,712,036) | 2,561,992 |
Prescription Medications | ||
Results of operations by reportable segment | ||
Net sales | 2,734,639 | 4,605,043 |
Cost of goods sold | 949,197 | 577,795 |
Selling, general and administrative expenses | 4,947,466 | 6,473,482 |
Gain on settlement with Vivus | (3,389,941) | |
Research and development expenses | 1,541,714 | 1,788,491 |
Depreciation and amortization expense | 4,442,922 | 5,564,499 |
Intangible asset impairment | 7,460,000 | |
Interest income | (14,194) | |
Net loss | (13,202,525) | (9,799,224) |
Medical Devices | ||
Results of operations by reportable segment | ||
Net sales | 3,257,415 | 3,206,221 |
Cost of goods sold | 1,340,221 | 1,021,771 |
Selling, general and administrative expenses | 1,685,678 | 2,620,403 |
Research and development expenses | 198,566 | |
Depreciation and amortization expense | 1,155,962 | 1,313,491 |
Net loss | $ (1,123,012) | $ (1,749,444) |
Segment Information - Net Sales
Segment Information - Net Sales by Geographic region (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Information | ||
Net sales | $ 5,992,054 | $ 7,811,264 |
United States | ||
Segment Information | ||
Net sales | 4,799,132 | 6,572,849 |
International | ||
Segment Information | ||
Net sales | $ 1,192,922 | $ 1,238,415 |
Segment Information - Segment a
Segment Information - Segment assets (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Segment Information | ||
Intangible assets, net | $ 12,244,484 | $ 25,293,149 |
Total segment assets | 32,421,214 | 67,390,058 |
Prescription Medications | ||
Segment Information | ||
Intangible assets, net | 7,178,704 | 19,071,407 |
Total segment assets | 25,831,048 | 59,657,514 |
Medical Devices | ||
Segment Information | ||
Intangible assets, net | 5,065,780 | 6,221,742 |
Total segment assets | $ 6,590,166 | $ 7,732,544 |