SmartKem (SMTK) 10-Q 13 May 22 2022 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2022	May 12, 2022
Document and Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2022
Entity File Number	000-56181
Entity Registrant Name	SmartKem, Inc.
Entity Incorporation, State or Country Code	X0
Entity Tax Identification Number	85-1083654
Entity Address, Address Line One	Manchester Technology Centre, Hexagon Tower.
Entity Address, Address Line Two	Delaunays Road
Entity Address, Address Line Three	Blackley
Entity Address State Or Province	DE
Entity Address, City or Town	Manchester
Entity Address, Postal Zip Code	M9 8GQ
City Area Code	011-44-161
Local Phone Number	721-1514
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
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		26,566,809
Entity Central Index Key	0001817760
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Amendment Flag	false

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 10,647	$ 12,226
Accounts receivable	30
Research and development tax credit receivable	1,324	1,070
Prepaid expenses and other current assets	1,265	802
Total current assets	13,266	14,098
Property, plant equipment, net of accumulated depreciation of $1,130 and $1,102	770	802
Right-of-use assets, net	90	154
Other assets	6	6
Total assets	14,132	15,060
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued expenses	1,160	1,423
Current lease liabilities	56	87
Total current liabilities	1,216	1,510
Non-current lease liabilities	19	28
Total liabilities	1,235	1,538
Commitments and contingencies (Note 8)
Stockholders' Equity:
Common stock, par value $0.0001 per share, 300,000,000 shares authorized, 26,566,809 and 25,554,309 shares issued and outstanding, at March 31, 2022 and December 31, 2021, respectively*	3	3
Additional paid-in capital	91,935	89,954
Accumulated other comprehensive loss	(1,207)	(1,363)
Accumulated deficit	(77,834)	(75,072)
Total Stockholders' equity	12,897	13,522
Total Liabilities and Stockholders' Equity	$ 14,132	$ 15,060

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Condensed Consolidated Balance Sheets
Property, plant equipment, net of accumulated depreciation	$ 1,130	$ 1,102
Common shares, par value	$ 0.0001	$ 0.0001
Common Stock, Shares Authorized	300,000,000	300,000,000
Common Stock, Shares Issued	26,566,809	25,554,309
Common Stock, Shares Outstanding	26,566,809	25,554,309

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Condensed Consolidated Statements of Operations and Comprehensive Loss
Revenue	$ 30
Cost of revenue	23
Gross profit	7
Other operating income	284	$ 433
Operating Expenses:
Research and development	1,459	4,013
Selling, general and administrative	1,240	3,983
Transaction expenses		1,314
Total operating expenses	2,699	9,310
Loss from operations	(2,408)	(8,877)
Non-operating (Expense)/Income
(Loss) on foreign currency transactions	(354)	(470)
Interest expense		(19)
Total non-operating (expense)	(354)	(489)
Loss before income taxes	(2,762)	(9,366)
Net loss	(2,762)	(9,366)
Other comprehensive loss:
Foreign currency translation	156	16
Total comprehensive loss	$ (2,606)	$ (9,350)
Basic net loss per common share	$ (0.10)	$ (0.51)
Dilutive net loss per common share	$ (0.10)	$ (0.51)
Basic weighted average shares outstanding	28,438,003	18,351,532
Dilutive weighted average shares outstanding	28,438,003	18,351,532

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Common stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Total
Beginning Balance at Dec. 31, 2020	$ 1	$ 61,276	$ (1,480)	$ (57,946)	$ 1,851
Beginning Balance (in shares) at Dec. 31, 2020	13,627,887
Issuance of common shares due to exercise of stock-options	$ 1	19			20
Issuance of common shares due to exercise of stock-options (in shares)	1,404,813
Stock-based compensation expense		6,020			6,020
Repurchase of common shares (in shares)	(2,307,700)
Effect of reverse capitalization (in shares)	2,500,000
Issuance of common shares to vendor		99			99
Issuance of common shares to vendor (in shares)	50,000
Issuance of common stock and warrants in private placement	$ 1	24,637			24,638
Issuance of common stock and warrants in private placement (in shares)	10,162,000
Issuance costs related to common shares and warrants in private placement		(2,454)			(2,454)
Foreign currency translation adjustment			16		16
Net loss				(9,366)	(9,366)
Ending Balance at Mar. 31, 2021	$ 3	89,597	(1,464)	(67,312)	20,824
Ending Balance (in shares) at Mar. 31, 2021	25,437,000
Beginning Balance at Dec. 31, 2021	$ 3	89,954	(1,363)	(75,072)	13,522
Beginning Balance (in shares) at Dec. 31, 2021	25,554,309
Stock-based compensation expense		98			98
Issuance of common shares to vendor		43			43
Issuance of common shares to vendor (in shares)	12,500
Issuance of common stock in private placement		2,000			2,000
Issuance of common stock in private placement (in shares)	1,000,000
Issuance costs related to common shares and warrants in private placement		(160)			(160)
Foreign currency translation adjustment			156		156
Net loss				(2,762)	(2,762)
Ending Balance at Mar. 31, 2022	$ 3	$ 91,935	$ (1,207)	$ (77,834)	$ 12,897
Ending Balance (in shares) at Mar. 31, 2022	26,566,809

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Cash flows from operating activities:
Net loss	$ (2,762)	$ (9,366)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	54	48
Common shares issued to vendor for services	43	99
Amortization of right of use asset	63	47
Stock-based compensation	98	6,020
Change in operating assets and liabilities:
Accounts receivable, net	(30)	19
Research & development tax credit receivable	(284)	(248)
Prepaid expenses and other current assets	(471)	(963)
Accounts payable and accrued expenses	(240)	659
Lease liabilities	(40)	(55)
Other assets		(1)
Net cash used in operating activities	(3,569)	(3,741)
Cash flows from investing activities:
Purchases of property, plant and equipment	(41)
Net cash used by investing activities	(41)
Cash flows from financing activities:
Proceeds from term loan payable		739
Repayment of term loan payable		(739)
Proceeds from the issuance of common stock and warrants in private placement		24,638
Proceeds from the issuance of common stock in private placement	2,000
Payment of issuance costs	(160)	(2,454)
Proceeds from the exercise of stock options		20
Net cash provided by financing activities	1,840	22,204
Effect of exchange rate changes on cash	191	7
Net change in cash	(1,579)	18,470
Cash, beginning of period	12,226	764
Cash, end of period	$ 10,647	19,234
Supplemental disclosure of cash and non-cash investing and financing activities
Cash paid for interest		$ 19

BUSINESS AND BASIS OF PREPARATI

BUSINESS AND BASIS OF PREPARATION	3 Months Ended
	Mar. 31, 2022
BUSINESS AND BASIS OF PREPARATION
BUSINESS AND BASIS OF PREPARATION	1. BUSINESS AND BASIS OF PREPARATION SmartKem Inc. (“SmartKem” or the “Company”) a Delaware corporation, formerly known as Parasol Investments Corporation (“Parasol”), was formed on May 13, 2020 and is the successor, as discussed below, of SmartKem Limited, which was formed under the Laws of England and Wales. The Company was founded as a “shell” company registered under the Exchange Act, with no specific business plan or purpose until it began operating the business of SmartKem Limited following the closing of the Exchange described below. SmartKem is seeking to reshape the world of electronics with a revolutionary semiconductor platform that enables a new generation of displays, sensors and logic. SmartKem’s patented TRUFLEX® inks are solution deposited at a low temperature, on low-cost substrates to make organic thin-film transistor (OTFT) circuits. The company’s semiconductor platform can be used in a number of applications including mini-LED displays, AMOLED displays, fingerprint sensors and logic circuits. SmartKem develops its materials at its research and development facility in Manchester, UK and its semiconductor manufacturing process at the Centre of Process Innovation (CPI) in Sedgefield, UK. The company has an extensive IP portfolio including approximately 120 issued patents. Basis for Presentation These unaudited interim condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission and accounting principles generally accepted in the United States (“U.S. GAAP”) for interim reporting and are presented in thousands, except number of shares and per share data. Accordingly, certain notes or other information that are normally required by U.S. GAAP have been omitted if they substantially duplicate the disclosures contained in the Company’s annual audited consolidated financial statements. Accordingly, the unaudited interim condensed consolidated financial statements should be read in connection with the Company’s audited financial statements and related notes as of and for the year ended December 31, 2021. The accompanying interim condensed consolidated financial statements are unaudited; however, in the opinion of management, they include all normal and recurring adjustments necessary for a fair presentation of the Company’s unaudited interim condensed consolidated financial statements for the periods presented. Results of operations reported for interim periods are not necessarily indicative of results for the entire year. Comprehensive loss of all periods presented is comprised primarily of net loss and foreign currency translation adjustments. Going Concern The accompanying unaudited interim condensed consolidated financial statements have been presented on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the ordinary course of business. Since inception, we have incurred recurring losses including net losses of $2.8 million for the three months ended March 31, 2022. As of March 31, 2022 we had an accumulated deficit of $77.8 million. The Company’s cash as of March 31, 2022 was $10.6 million. We anticipate operating losses to continue for the foreseeable future due to, among other things, costs related to research funding, further development of our technology and products and expenses related to the commercialization of our products. Management believes that the Company’s existing cash as of March 31, 2022 will be sufficient to fund the operations of the Company through to April 2023 and that the Company will require additional capital to continue its operations and research and development activity thereafter. There can be no assurance, however, that such financing will be available when needed, if at all, or on acceptable terms and conditions. The precise amount and timing of the funding needs cannot be determined accurately at this time, and will depend on a number of factors, including the market demand for the Company’s products, the quality of product development efforts, management of working capital, and the continuation of normal payment terms and conditions for purchase of services. In order to address its capital needs, including its planned research and development activities and other expenditures, the Company is assessing options for financing our working capital requirements through a combination of equity offerings, debt financings, collaborations, strategic alliances and marketing, distribution or licensing arrangements. Adequate financing opportunities might not be available to the Company, when and if needed, on acceptable terms or at all. If the Company is unable to obtain additional financing in sufficient amounts or on acceptable terms, the Company will be forced to delay, reduce or eliminate some or all of its research and development programs and product portfolio expansion, which could adversely affect its operating results or business prospects. Although management continues to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company to fund continuing operations, if at all. After considering the uncertainties, management consider it is appropriate to continue to adopt the going concern basis in preparing the consolidated financial statements. The accompanying unaudited interim condensed consolidated financial statements do not include any adjustments that might be necessary should we be unable to continue as a going concern. Reverse Recapitalization On February 23, 2021 Parasol entered into a Securities Exchange Agreement (“the Exchange Agreement”), with SmartKem Limited. Pursuant to the Exchange Agreement all of the equity interests in SmartKem Limited, except certain deferred shares which had no economic or voting rights (the “Deferred Shares”) and which were purchased by Parasol for an aggregate purchase price of $1.40, were exchanged for shares of Parasol common stock, par value $0.0001 per share (“common stock”), and SmartKem Limited became a wholly owned subsidiary of Parasol (the “Exchange”). As a result of the Exchange, Parasol acquired the business of SmartKem Limited, and continues as the existing business operations of SmartKem Limited as a public reporting company under the name SmartKem, Inc. Under ASC 805, Business Combinations, SmartKem Limited was deemed the accounting acquirer based on the following predominate factors: Parasol was created as a “shell” company to effect a business combination and had no operations, the former shareholders of SmartKem Limited own more than a majority of the outstanding voting stock of the Company, the Company’s board of directors and management consists of the former board of directors and management of SmartKem Limited, SmartKem Limited was the largest entity by assets at the time of the Exchange, and the principal operating location of the Company is SmartKem Limited’s premises which are located in Manchester, United Kingdom. The Exchange was accounted for as a reverse recapitalization, with no goodwill or other intangible assets recorded, in accordance with U.S. GAAP. Under this method of accounting, Parasol was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the Exchange was treated as the equivalent of SmartKem Limited issuing stock for the net assets of Parasol, accompanied by a recapitalization. The net assets of Parasol are stated at historical cost, with no goodwill or other intangible assets recorded. The consolidated assets, liabilities, and results of operations prior to the Exchange are those of SmartKem Limited. Reported shares and earnings per share available to holders of the Company’s common stock, prior to the Exchange, have been retroactively restated as shares reflecting the exchange ratios established in the Exchange. At the closing of the Exchange (the “Closing”), each SmartKem Limited ordinary share issued and outstanding immediately prior to the Closing (other than the Deferred Shares) was exchanged for 0.0111907 of a share of the Company’s common stock and each SmartKem Limited A ordinary share issued and outstanding immediately prior to the Closing was exchanged for 0.0676668 of a share of the Company’s common stock, with the maximum number of shares of our common stock issuable to the former holders of SmartKem Limited’s ordinary shares and A ordinary shares equal to 12,725,000. This includes enterprise management incentive options to purchase 124,497,910 SmartKem Limited ordinary shares (the “SmartKem Limited EMI Options”) issued and outstanding immediately prior to the Closing that were accelerated and exercised by the holders thereof for a like number of ordinary shares and exchanged for shares of the Company’s common stock pursuant to the Exchange. In aggregate 1,127,720,477 SmartKem Limited shares were exchanged for 12,725,000 of the Company’s common stock, an average exchange ratio of 0.011283825. Immediately prior to the Closing, an aggregate of 2,500,000 shares of the Company’s common stock owned by the stockholders of Parasol prior to the Exchange were forfeited and cancelled (the “Stock Forfeiture”). The consolidated entity presented is referred to herein as “SmartKem”, “we”, “us”, “our”, or the “Company”, as the context requires and unless otherwise noted.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 31, 2022
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Basis of Consolidation The unaudited interim condensed consolidated financial statements include the accounts of SmartKem, Inc. and its wholly-owned subsidiaries, SmartKem Delaware, Inc. and SmartKem Limited. The Company does not have any nonconsolidated subsidiaries. All intercompany balances and transactions have been eliminated on consolidation, including unrealized gains and losses on transactions between the companies. The Company's formerly wholly-owned subsidiary, SmartKem Delaware Inc. was dissolved on May 13, 2021. Comprehensive loss Comprehensive loss of all periods presented is comprised primarily of net loss and foreign currency translation adjustments. Management’s Use of Estimates The preparation of interim condensed consolidated financial statements in conformity U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including disclosure of contingent assets and liabilities, at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. The most significant estimates in the Company’s unaudited interim condensed consolidated financial statements relates to the valuation of common share, fair value of share options, and the valuation allowance of deferred tax assets. These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources. Due to the uncertainty of factors surrounding the estimates or judgments used in the preparation of the financial statements, actual results may materially vary from these estimates. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of 90 days or less at acquisition to be cash equivalents. As of March 31, 2022 and December 31, 2021, the Company did not have any cash equivalents. Accounts Receivable Accounts receivable are stated at the amount the Company expects to collect and do not bear interest. The Company considers the following factors when determining the collectability of specific customer accounts: customer credit-worthiness, past transaction history with the customer, current economic industry trends, and changes in customer payment terms. These receivables have historically been paid timely. Due to the nature of the accounts receivable balance, the Company believes there is no significant risk of non-collection. If the financial condition of the Company’s customers were to deteriorate, adversely affecting their ability to make payments, allowances for doubtful accounts would be required. There was no allowance for doubtful accounts recorded as of March 31, 2022 and December 31, 2021. Impairment of Long-Lived Assets Management continually evaluates whether events or changes in circumstances might indicate that the remaining estimated useful life of long-lived assets may warrant revision, or that the remaining balance may not be recoverable. When factors indicate that long-lived assets should be evaluated for possible impairment, the Company uses an estimate of the related undiscounted cash flows in measuring whether the long-lived asset should be written down to fair value. Measurement of the amount of impairment would be based on generally accepted valuation methodologies, as deemed appropriate. If the carrying amount is greater than the undiscounted cash flows, the carrying amount of the asset is reduced to the asset’s fair value. An impairment loss is recognized immediately as an operating expense in the condensed consolidated statements of operations. Reversal of previously recorded impairment losses are prohibited. As of March 31, 2022 and December 31, 2021, Company’s management believed that no revision to the remaining useful lives or impairment of the Company’s long-lived assets was required. Warrants The accounting treatment of warrants issued is determined pursuant to the guidance provided by ASC 480, Distinguishing Liabilities from Equity Derivatives and Hedging Leases Operating lease assets are included within operating lease right-of-use assets, and the corresponding operating lease obligation on the unaudited condensed consolidated balance sheets as of March 31, 2022 and December 31, 2021. The Company has elected not to present short-term leases as these leases have a lease term of 12 months or less at lease inception and do not contain purchase options or renewal terms that the Company is reasonably certain to exercise. All other lease assets and lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. Because most of the Company’s leases do not provide an implicit rate of return, the Company used an incremental borrowing rate based on the information available at adoption date in determining the present value of lease payments. Revenue The Company applies the provisions of ASC 606 Revenue from Contracts with Customers The Company’s current contracts with customers do not contain significant estimates or judgments. All of the Company’s revenue contains a single performance obligation that is recognized upon fulfilment of the sales order. The Company derives its revenues primarily from sales of demonstrator units to customers evaluating organic semiconductor technology. The transaction price is stated in each customer agreement and is allocated to a single performance obligation. Revenue is recognized upon shipment of each demonstrator, at a point in time. The Company does not have any significant financing components as payment is received at or shortly after the point of sale. Costs incurred to obtain a contract will be expenses as incurred when the amortization period is less than a year. Other Operating Income The Company’s other operating income is related to government grant incentives received for qualifying research and development projects, and research and development tax credits related to the United Kingdom’s Research and Development Expenditure Credit scheme, which is a government tax incentive designed to reward innovative companies for investing in research and development. Such incentives are recorded as other income when it is probable the amounts are collectible and can be reasonably estimated. For the three months ended March 31, 2022 and 2021, the Company recorded grant income and research & development tax credits of $284 thousand and $433 thousand, respectively. As of March 31, 2022, and December 31, 2021, the Company had receivables related to research & development tax credits for payments not yet received of $1,324 thousand and $1,070 thousand, respectively. Share-based compensation All share-based payments, including grants of stock options, are measured based on the fair value of the share-based awards at the grant date and recognized over their respective vesting periods. Outstanding options generally expire 10 years after the grant date. The Company has issued options that vest based on service requirements and issued options that vest based on performance requirements. Options become exercisable when service requirements are met. In the case of performance based options, options become exercisable when there is a liquidity event, such as a change in control or sale or admission (listing as a public company or initial public offering (“IPO”)), and the employee, or consultant, must be providing services to the Company at the time of the event. Due to the Exchange, all options outstanding immediately prior to the event with a performance obligation requirement became vested and exercisable. The estimated fair value of stock options at the grant date is determined using the Black-Scholes pricing model. The Black-Scholes option pricing model requires inputs such as the fair value of common stock on date of grant, expected term, expected volatility, dividend yield, and risk-free interest rate. The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and management uses different assumptions, stock-based compensation expense could be materially different for future awards. The Company records forfeitures when they occur. Functional Currency and Operations Prior to the Exchange, SmartKem Limited’s (“the predecessor’s”) functional currency was the British Pound Sterling (“GBP”), and the consolidated financial statements were presented in United States dollars (“USD”). The predecessor’s functional currency was the respective local currency of the primary economic environment in which an entity’s operations are conducted. The predecessor translated the financial statements into the presentation currency using exchanges rates in effect on the balance sheet date for assets and liabilities and average exchanges rates for the period for statement of operations accounts, with the difference recognized in accumulated other comprehensive income /(loss). From the date of the Exchange forward, the Company’s functional currency is the U.S. dollar (“USD”). The functional currency of the Company’s foreign operation is the respective local currency. Assets and liabilities of foreign operation denominated in local currencies are translated at the spot rate in effect at the applicable reporting date. The condensed consolidated statements of operations and comprehensive loss are translated at the weighted average rate of exchange during the applicable period. The resulting unrealized gain/loss is recognized as foreign currency translation as a component of other comprehensive income. Income Taxes Income taxes are recorded in accordance with ASC 740, Income Taxes The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. The Company recognizes any interest and penalties accrued related to unrecognized tax benefits as income tax expense. As of March 31, 2022 and December 31, 2021, there were no accruals for uncertain tax positions. Contingent Liabilities A provision for contingent liabilities is recorded when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. With respect to legal matters, provisions are reviewed and adjusted to reflect the impact of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter. The Company is a party to certain litigation and disputes arising in the normal course of business. As of March 31, 2022, the Company does not expect that such matters will have a material adverse effect on the Company’s business, financial position, results of operations, or cash flows. Offering Costs Direct and incremental legal and accounting costs associated with the Company’s issuance of common stock and warrants are deferred and classified as a component of other assets on the condensed consolidated balance sheet until completion of the issuance. Upon completion of the issuance, deferred offering costs are reclassified from other assets to equity and recorded against the net proceeds received in the issuance. For the three months ended March 31, 2022 and 2021 respectively, $160 thousand and $2,454 thousand of offering costs were recorded in additional paid-in capital. Segment Information The Company has determined that it operates and reports in one segment Basic and Diluted Loss Per Share Basic and diluted net loss per share is determined by dividing net loss by the weighted average ordinary shares outstanding during the period. For all periods presented with a net loss, the shares underlying the ordinary share options and warrants have been excluded from the calculation because their effect would be anti-dilutive. Therefore, the weighted-average shares outstanding used to calculate both basic and diluted loss per share are the same for periods with a net loss. The loss per share information in these unaudited interim condensed consolidated financial statements is reflected and calculated as if the Company had existed since January 1, 2020. Accordingly, loss per share for all periods was calculated based on the number of shares retroactively adjusted for the exchange ratio determined in the reverse recapitalization (see also note 1). The Company has 2,168,000 pre-funded common stock warrants outstanding as of March 31, 2022, which became exercisable on April 23, 2021 based on terms and conditions of the agreements. As the pre-funded common stock warrants are exercisable for $0.01, these shares are considered outstanding common shares and included in computation of basic and diluted Earnings Per Share as the exercise of the pre-funded common stock warrants is virtually assured. The Company included these pre-funded common stock warrants in basic and diluted earnings per share when all conditions were met on April 23, 2021. The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding as they would be anti-dilutive: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ 2022 2021 Options ​ ​ 1,953,882 ​ ​ 1,546,562 Warrants ​ 985,533 ​ 3,153,533 Total ​ ​ 2,939,415 ​ ​ 4,700,095 ​ Recent Accounting Pronouncements Adopted In May 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2021-04, Issuer's Accounting for Certain Modifications or Exchanges of Freestanding Equity Classified Written Call Options general, if the fair value of the "new" instrument is greater than the fair value of the "original" instrument, the excess is recognized based on the substance of the transaction, as if the issuer has paid cash. The effective date of the standard is for interim and annual reporting periods beginning after December 15, 2021 for all entities, and early adoption is permitted. The Company adopted ASU 2021-04 on January 1, 2022. As a result of Management’s evaluation, the adoption of ASU 2021-04 did not have a material impact on the consolidated financial statements. In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832) ("ASU 2021-10"), which provides guidance on disclosing government assistance. Under the new guidance, the Company is required to including the disclosure of (1) the types of assistance, (2) an entity's accounting for the assistance, and (3) the effect of the assistance on the entity's financial statements. The effective date of the standard is for annual periods beginning after December 15, 2021. The Company adopted ASU 2021-10 on January 1, 2022. As a result of Management’s evaluation, the adoption of ASU 2021-10 did not have a material on the consolidated financial statements. Recent Accounting Pronouncements Not Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments: Credit Losses (Topic 326) Reclassifications Certain amounts in prior periods' interim condensed consolidated financial statements have been reclassified to conform to the current period’s presentation.

PREPAID EXPENSES AND OTHER CURR

PREPAID EXPENSES AND OTHER CURRENT ASSETS	3 Months Ended
	Mar. 31, 2022
PREPAID EXPENSES AND OTHER CURRENT ASSETS
PREPAID EXPENSES AND OTHER CURRENT ASSETS	3. PREPAID EXPENSES AND OTHER CURRENT ASSETS: Prepaid expenses and other current assets consist of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ 2022 2021 Prepaid service charges and property taxes ​ $ 74 ​ $ 58 Prepaid utilities ​ 6 ​ 51 Prepaid insurance ​ 805 ​ 412 Prepaid administrative expenses ​ 149 ​ 63 Prepaid technical fees ​ ​ 72 ​ ​ 141 Prepaid consulting fees ​ ​ 51 ​ ​ 27 VAT receivable ​ 107 ​ 50 Other Receivable and other prepaid expenses ​ ​ 1 ​ ​ — Total prepaid expenses and other current assets ​ $ 1,265 ​ $ 802 ​ As of March 31, 2022 and December 31, 2021, there was $204 thousand and $217 , thousand respectively, of non-current prepaid insurance related to directors’ and officers’ liability insurance that was included in the amounts above.

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT	3 Months Ended
	Mar. 31, 2022
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT	4. PROPERTY, PLANT AND EQUIPMENT: Property, plant and equipment consist of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ 2022 2021 Plant and equipment ​ $ 1,635 ​ $ 1,633 Furniture and fixtures ​ 239 ​ 245 Computer hardware and software ​ 26 ​ 26 ​ ​ 1,900 ​ 1,904 Less: Accumulated depreciation ​ (1,130) ​ (1,102) Property, plant and equipment, net ​ $ 770 ​ $ 802 ​ Depreciation expense was $54 thousand and $48 thousand for three months ended March 31, 2022 and 2021, respectively, and is classified as research and development expense.

ACCOUNTS PAYABLE AND ACCRUED EX

ACCOUNTS PAYABLE AND ACCRUED EXPENSES	3 Months Ended
	Mar. 31, 2022
ACCOUNTS PAYABLE AND ACCRUED EXPENSES
ACCOUNTS PAYABLE AND ACCRUED EXPENSES	5. ACCOUNTS PAYABLE AND ACCRUED EXPENSES: Accounts payable and accrued expenses consist of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ 2022 2021 Accounts payable ​ $ 381 ​ $ 510 Accrued expenses – lab refurbishments ​ 128 ​ 131 Accrued expenses – technical fees ​ 76 ​ 66 Accrued expenses – variable rent & utilities ​ 6 ​ 20 Accrued expenses – audit & accounting fees ​ 181 ​ 191 Accrued expenses – other ​ 60 ​ 112 Credit card liabilities ​ 13 ​ 10 Payroll and social security liabilities ​ 315 ​ 383 Total accounts payable and accrued expenses ​ $ 1,160 ​ $ 1,423 ​

LEASES

LEASES	3 Months Ended
	Mar. 31, 2022
LEASES
LEASES	6. LEASES: The Company has operating leases consisting of office space, lab space, and equipment with remaining lease terms of 1 to 3 years, subject to certain renewal options as applicable. There was no sublease rental income for three months ended March 31, 2022 and 2021. The Company is not the lessor in any lease agreement, and no related party transactions for lease arrangements have occurred. The table below presents certain information related to the lease costs for the Company’s operating and finance leases for the periods ended: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 2021 Operating lease cost ​ $ 63 ​ $ 47 Short-term lease cost ​ 2 ​ 13 Variable lease cost ​ 54 ​ 23 Total lease cost ​ $ 119 ​ $ 83 ​ The total lease cost is included in the unaudited condensed consolidated statements of operations as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 2021 Research and development ​ $ 113 ​ $ 70 Selling, general and administrative ​ 6 ​ 13 Total lease cost ​ $ 119 ​ $ 83 ​ Right of use lease assets and lease liabilities for our operating leases were recorded in the unaudited condensed consolidated balance sheet as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ 2022 2021 Assets ​ ​ ​ Operating lease right of use assets ​ $ 90 ​ $ 154 Total lease assets ​ $ 90 ​ $ 154 Liabilities ​ ​ Current liabilities: ​ ​ Operating lease liability – current portion ​ $ 56 ​ $ 87 Noncurrent liabilities: ​ ​ ​ Operating lease liability, net of current portion ​ 19 ​ 28 Total lease liabilities ​ $ 75 ​ $ 115 ​ The Company had no right of use lease assets and lease liabilities for financing leases as of March 31, 2022 and December 31, 2021. The table below presents certain information related to the cash flows for the Company’s operating leases for the periods ended: ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 2021 Operating cash outflows from operating leases $ 40 ​ $ 55 Supplemental non-cash amounts of operating lease liabilities arising from obtaining right of use assets $ — ​ $ — ​ The table below presents certain information related to the weighted average remaining lease term and the weighted average discount rate for the Company’s operating and finance leases as of the period ended: ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 ​ ​ 2021 ​ Weighted average remaining lease term (in years) – operating leases 1.42 ​ 1.10 Weighted average discount rate – operating leases 6.03 % ​ 6.30 % ​ Undiscounted operating lease liabilities as of March 31, 2022, by year and in the aggregate, having non-cancelable lease terms in excess of one year were as follows: ​ ​ ​ ​ ​ ​ As of ​ ​ March 31, ​ ​ 2022 2022 ​ $ 50 2023 ​ 22 2024 ​ 7 2025 ​ — 2026 ​ — Thereafter ​ — Total undiscounted lease payments ​ 79 Less imputed interest ​ (4) Total net lease liabilities ​ $ 75 ​

NOTES PAYABLE

NOTES PAYABLE	3 Months Ended
	Mar. 31, 2022
NOTES PAYABLE.
NOTES PAYABLE	7. NOTES PAYABLE: On January 26, 2021, the Company entered into a term loan facility agreement for the amount of $739 thousand. The funds were available to be drawn on from the effective date of the agreement through January 27, 2021. The Company drew down the full loan amount on January 26, 2021. The Company’s research and development tax credit was to be utilized as collateral. The Lender was to be paid immediately following payment of research and development tax credit from the United Kingdom’s HM Revenue and Customs. The final repayment was due six months from the agreement date, if the loan and any interest was not repaid in full prior to this date. The loan carried a monthly interest rate of 1.25%. The interest accrued daily and compounded monthly on the monthly anniversary of the draw down date of the loan. The Company repaid the note payable in full on March 2, 2021. For three months ended March 31, 2021, the Company incurred an effective interest rate of 26.20% relating to notes payable. The interest expense recognized based on the debt’s effective interest rate for nine months ended March 31, 2021, was $19 thousand. There were no notes payable outstanding during the three months ended March 31, 2022 and no associated interest expense during the period.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2022
COMMITMENTS AND CONTINGENCIES.
COMMITMENTS AND CONTINGENCIES	8. COMMITMENTS AND CONTINGENCIES: Legal proceedings In the normal course of business, the Company may become involved in legal disputes regarding various litigation matters. In the opinion of management, any potential liabilities resulting from such claims would not have a material effect on the financial statements. Capital expenditure commitments and unconditional purchase obligations contracted for but not yet incurred as of March 31, 2022, totaled $1,350 thousand and primarily consists of purchase commitments in the normal course of business for research & development services, communications infrastructure and administrative services.

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY	3 Months Ended
	Mar. 31, 2022
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY	9. STOCKHOLDERS’ EQUITY: Common Stock Voting Rights Each holder of common stock is entitled to one vote for each share on all matters submitted to a vote of the stockholders, including the election of directors. The Company’s amended and restated certificate of incorporation and the Company’s amended and restated bylaws do not provide for cumulative voting rights. The holders of one-third of the stock issued and outstanding and entitled to vote, present in person or represented by proxy, shall constitute a quorum for the transaction of business at all meetings of the stockholders. Dividends The Company has never paid any cash dividends to shareholders and do not anticipate paying any cash dividends to shareholders in the foreseeable future. Any future determination to pay cash dividends will be at the discretion of our board of directors and will be dependent upon financial condition, results of operations, capital requirements and such other factors as the board of directors deems relevant. Market Information Quotations on our common stock on the OTC Market Group’s OTCQB® Market quotation system (“OTCQB”) commenced under the ticker symbol “SMTK” in February 2022. There was no trading of our common stock on the OTCQB or any other over-the-counter market prior to February 2022. Preferred Stock The Company currently has no shares of preferred stock outstanding, and the Company has no present plan to issue any shares of preferred stock. The board of directors has the authority, without further action by the stockholders, to issue up to 10,000,000 shares of preferred stock in one or more series and to fix the rights, preferences, privileges and restrictions thereof. These rights, preferences, and privileges could include dividend rights, conversion rights, voting rights, redemption rights, liquidation preferences, sinking fund terms, and the number of shares constituting any series or the designation of such series, any or all of which may be greater than the rights of common stock. Common Stock Warrants On February 23, 2021, a total of 985,533 fully vested common stock warrants were issued to a vendor for financial advisory services provided in connection with the sale of the Company’s common stock . The common stock warrants are exercisable at a per share price of $2.00 until they expire on February 23, 2026. During the three months ended March 31, 2022, no warrants issued to vendors for financial advisory services were exercised. The grant date fair value for these warrants of $0.91 per warrant for a total fair value of $896 thousand, was determined using the Black-Scholes options valuation model. The Company recorded the warrants at fair value, as both an increase and decrease in additional paid-in capital during the three months ended March 31, 2021. There were no warrants issued during the three months ended March 31, 2022. A summary of the Company’s warrants to purchase common stock activity is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ ​ ​ ​ ​ ​ ​ Average ​ ​ ​ ​ Weighted- ​ Remaining ​ ​ ​ ​ Average ​ Contractual ​ ​ Number of ​ Exercise ​ Term ​ ​ Shares ​ Price ​ (Years) Warrants outstanding at January 1, 2022 985,533 ​ $ 2.00 4.15 Exercised — ​ — — Forfeited or Expired — ​ — — Granted — ​ - — Warrants outstanding at March 31, 2022 985,533 ​ $ 2.00 3.90 ​ On February 23, 2021, a total of 2,168,000 pre-funded common stock warrants were issued to investors with an exercise price of $0.01 per share for total proceeds to the Company of $4,314 thousand. During the three months ended March 31, 2022, no warrants A summary of the Company’s pre-funded warrants to purchase common stock activity is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ ​ ​ ​ Average ​ ​ Number of ​ Exercise ​ ​ Shares ​ Price Pre-funded warrants outstanding at January 1, 2022 2,168,000 ​ $ 0.01 Exercised — ​ — Forfeited or Expired — ​ — Granted — ​ ​ Pre-funded warrants outstanding at March 31, 2022 2,168,000 ​ $ 0.01 ​ The grant date fair value of common stock warrants is determined using the Black Scholes option-pricing model. There was no public trading market for our shares before February 2022 and the Company estimates its expected stock volatility based on historical volatility of publicly traded peer companies. The Company did not issue any warrants in the three months ended March 31, 2022.

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION	3 Months Ended
	Mar. 31, 2022
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION	10. SHARE-BASED COMPENSATION: Prior to the Exchange discussed in Note 1, SmartKem Limited had stock option plans. SmartKem Limited had issued Enterprise Management Incentive options (“EMI Options”) and non-tax-advantaged options (“Unapproved Options”) to eligible employees, officers, non-employee directors and other individual service providers as a means for them to develop a sense of proprietorship and personal involvement in the development and financial success of SmartKem Limited. The options generally expired On February 23, 2021, the Company approved the 2021 Equity Incentive Plan (“2021 Plan”), in which a maximum aggregate number of shares of common stock that may be issued under the 2021 Plan is 2,275,000 shares. Subject to the adjustment provisions of the 2021 Plan, the number of shares of the Company’s common stock available for issuance under the 2021 Plan will also include an annual increase on the first day of each fiscal year beginning with 2022 fiscal year and ending on the Company’s 2031 fiscal year in an amount equal to the least of: 1) 2,275,000 shares of the Company’s common stock; 2) four percent (4%) of the outstanding shares of the Company’s common stock on the last day of the immediately preceding fiscal year; or 3) such number of shares of the Company’s common stock as the administrator may determine. As a result of the reverse merger and recapitalization, an aggregate of 402,586 options were issued during February 2021 under the 2021 Plan in consideration for the cancellation of the SmartKem Limited options that were outstanding. Of these options, 336,557 had an exercise price of $0.001 per share and 66,029 had an exercise price of $2.00 per share and all expire on the ten year anniversary of the grant date. These options were fully vested on the grant date. No options were awarded during the three months ended March 31, 2022. Determining the appropriate fair value of share-based awards requires the input of subjective assumptions, including the fair value of the Company’s common shares, and for share options, the expected life of the option, and expected share price volatility. The Company uses the Black-Scholes option pricing model to value its share option awards. The assumptions used in calculating the fair value of share-based awards represent management’s best estimates and involves inherent uncertainties and the application of management’s judgment. As a result, if factors change and management uses different assumptions, the share-based compensation expense could be materially different for future awards. In the absence of a public trading market of the common share, on each grant date, the Company develops an estimate of the fair value of the common shares underlying the option grants. The Company estimated the fair value of the common shares by referencing arms-length transactions inclusive of the common shares underlying which occurred on or near the valuation date(s). From February 2022, the Company’s common shares are publicly traded and the Company will no longer have to estimate the fair value of the common share, rather the value will be determined based on quoted market prices. The Company determined the fair value of common share using methodologies, approaches and assumptions consistent with the AICPA Practice Guide, Valuation of Privately Held Company Equity Securities Issued as Compensation and based in part on input from an independent third-party valuation firm. The Company estimates its expected volatility by using a combination of historical share price volatilities of similar companies within our industry. The risk-free interest rate assumption is based on observed interest rates for the appropriate term of the Company’s options on a grant date. The expected option term assumption is the contractual term, as the service period is implied under the practical expedient since the Company does not have sufficient exercise history to estimate expected term of its historical option awards. The following table reflects share activity under the share option plans for three months ended March 31, 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Average ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ Remaining ​ Weighted- ​ Aggregate ​ ​ ​ ​ Average ​ Contractual ​ Average ​ Intrinsic ​ ​ Number of ​ Exercise ​ Term ​ Fair Value at ​ Value ​ ​ Shares ​ Price ​ (Years) ​ Grant Date ​ (in thousands) Options outstanding at January 1, 2022 1,953,882 ​ $ 1.72323 9.31 ​ $ 1.12355 ​ $ ​ Exercised — ​ — ​ ​ ​ ​ Cancelled — ​ — ​ ​ ​ ​ Forfeited ​ — ​ ​ — ​ ​ ​ ​ ​ ​ ​ ​ Granted — ​ — ​ ​ ​ ​ Options outstanding at March 31, 2022 1,953,882 ​ $ 1.72323 9.06 ​ $ 1.12355 ​ $ ​ Options exercisable at March 31, 2022 ​ 622,549 ​ $ 1.13134 ​ 8.95 ​ ​ ​ ​ $ 1,475 Vested and expected to vest after March 31, 2022 ​ 1,953,882 ​ $ 1.72323 ​ 9.06 ​ ​ ​ ​ $ 3,472 ​ As of March 31, 2022, there were 622,549 exercisable options outstanding. Stock-based compensation, including stock options and warrants is included in the unaudited interim condensed consolidated statements of operations as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ ​ 2022 2021 Research and development ​ $ 40 ​ $ 2,908 Selling, general and administrative ​ 58 ​ 3,112 Total ​ $ 98 ​ $ 6,020 ​ Total compensation cost related to non-vested stock option awards not yet recognized as of March 31, 2022 was $1,234 thousand and will be recognized on a straight-line basis through the end of the vesting periods in September 2025. The amount of future stock option compensation expense could be affected by any future option grants or by any forfeitures.

SELLING, GENERAL AND ADMINISTRA

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES	3 Months Ended
	Mar. 31, 2022
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES	11. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES: Selling, general and administrative expenses are comprised of the following items: ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 2021 Salaries and benefits ​ $ 500 ​ $ 3,734 Rent and property tax expense ​ 28 ​ 13 Insurance ​ ​ 166 ​ ​ 81 Utilities ​ 1 ​ 1 Sales and marketing ​ 187 ​ 22 Legal and professional fees ​ 289 ​ 122 Other selling, general, and administrative expenses ​ 69 ​ 10 Total ​ $ 1,240 ​ $ 3,983 ​

DEFINED CONTRIBUTION PENSION

DEFINED CONTRIBUTION PENSION	3 Months Ended
	Mar. 31, 2022
DEFINED CONTRIBUTION PENSION
DEFINED CONTRIBUTION PENSION	12. DEFINED CONTRIBUTION PENSION: The Company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund. Pension cost is included in the unaudited interim condensed consolidated statements of operations as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 2021 Research and development ​ $ 27 ​ $ 23 Selling, general and administrative ​ 14 ​ 8 Total pension cost ​ $ 41 ​ $ 31 ​ As of March 31, 2022 and December 31, 2021 there were no amounts owed to the pension scheme.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	3 Months Ended
	Mar. 31, 2022
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS	13. RELATED PARTY TRANSACTIONS: In addition to transactions and balances related share-based compensation to officers and directors, the Company incurred expenses of $18 thousand and $7 thousand, for the three months ended March 31, 2022 and 2021, respectively, due to reimbursement of expenses and compensation for members of the Board of Directors. These expenses are recorded in selling, general & administrative in the unaudited interim condensed consolidated statements of operations. As of March 31, 2022 and December 31, 2021, there was $9 thousand and $18 thousand, respectively, payable to members of the Board of Directors that are recorded in accounts payable and accrued expenses on the unaudited interim condensed consolidated balance sheets. Octopus Share Purchase On January 27, 2022, we sold an aggregate of 1,000,000 shares of our common stock at a purchase price of $2.00 per share to Octopus Titan VCT plc and Octopus Investments Nominees Limited in accordance with the Letter Agreement, dated as of February 23, 2021, between the Company and Octopus Titan VCT plc and certain related parties. ​

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2022
SUBSEQUENT EVENTS.
SUBSEQUENT EVENTS	14. SUBSEQUENT EVENTS: In April 2022, the Company renewed its lease for research & development, engineering, testing and corporate offices in Manchester. The renewed lease term expires in 2025 with an option for the Company to end the lease in 2024.

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2022
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Consolidation	Basis of Consolidation The unaudited interim condensed consolidated financial statements include the accounts of SmartKem, Inc. and its wholly-owned subsidiaries, SmartKem Delaware, Inc. and SmartKem Limited. The Company does not have any nonconsolidated subsidiaries. All intercompany balances and transactions have been eliminated on consolidation, including unrealized gains and losses on transactions between the companies. The Company's formerly wholly-owned subsidiary, SmartKem Delaware Inc. was dissolved on May 13, 2021.
Comprehensive loss	Comprehensive loss Comprehensive loss of all periods presented is comprised primarily of net loss and foreign currency translation adjustments.
Management's Use of Estimates	Management’s Use of Estimates The preparation of interim condensed consolidated financial statements in conformity U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including disclosure of contingent assets and liabilities, at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. The most significant estimates in the Company’s unaudited interim condensed consolidated financial statements relates to the valuation of common share, fair value of share options, and the valuation allowance of deferred tax assets. These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources. Due to the uncertainty of factors surrounding the estimates or judgments used in the preparation of the financial statements, actual results may materially vary from these estimates.
Cash and Cash Equivalents	Cash and Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of 90 days or less at acquisition to be cash equivalents. As of March 31, 2022 and December 31, 2021, the Company did not have any cash equivalents.
Accounts Receivable	Accounts Receivable Accounts receivable are stated at the amount the Company expects to collect and do not bear interest. The Company considers the following factors when determining the collectability of specific customer accounts: customer credit-worthiness, past transaction history with the customer, current economic industry trends, and changes in customer payment terms. These receivables have historically been paid timely. Due to the nature of the accounts receivable balance, the Company believes there is no significant risk of non-collection. If the financial condition of the Company’s customers were to deteriorate, adversely affecting their ability to make payments, allowances for doubtful accounts would be required. There was no allowance for doubtful accounts recorded as of March 31, 2022 and December 31, 2021.
Impairment of Long-Lived Assets	Impairment of Long-Lived Assets Management continually evaluates whether events or changes in circumstances might indicate that the remaining estimated useful life of long-lived assets may warrant revision, or that the remaining balance may not be recoverable. When factors indicate that long-lived assets should be evaluated for possible impairment, the Company uses an estimate of the related undiscounted cash flows in measuring whether the long-lived asset should be written down to fair value. Measurement of the amount of impairment would be based on generally accepted valuation methodologies, as deemed appropriate. If the carrying amount is greater than the undiscounted cash flows, the carrying amount of the asset is reduced to the asset’s fair value. An impairment loss is recognized immediately as an operating expense in the condensed consolidated statements of operations. Reversal of previously recorded impairment losses are prohibited. As of March 31, 2022 and December 31, 2021, Company’s management believed that no revision to the remaining useful lives or impairment of the Company’s long-lived assets was required.
Warrants	Warrants The accounting treatment of warrants issued is determined pursuant to the guidance provided by ASC 480, Distinguishing Liabilities from Equity Derivatives and Hedging
Leases	Leases Operating lease assets are included within operating lease right-of-use assets, and the corresponding operating lease obligation on the unaudited condensed consolidated balance sheets as of March 31, 2022 and December 31, 2021. The Company has elected not to present short-term leases as these leases have a lease term of 12 months or less at lease inception and do not contain purchase options or renewal terms that the Company is reasonably certain to exercise. All other lease assets and lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. Because most of the Company’s leases do not provide an implicit rate of return, the Company used an incremental borrowing rate based on the information available at adoption date in determining the present value of lease payments.
Revenue	Revenue The Company applies the provisions of ASC 606 Revenue from Contracts with Customers The Company’s current contracts with customers do not contain significant estimates or judgments. All of the Company’s revenue contains a single performance obligation that is recognized upon fulfilment of the sales order. The Company derives its revenues primarily from sales of demonstrator units to customers evaluating organic semiconductor technology. The transaction price is stated in each customer agreement and is allocated to a single performance obligation. Revenue is recognized upon shipment of each demonstrator, at a point in time. The Company does not have any significant financing components as payment is received at or shortly after the point of sale. Costs incurred to obtain a contract will be expenses as incurred when the amortization period is less than a year.
Other Operating Income	Other Operating Income The Company’s other operating income is related to government grant incentives received for qualifying research and development projects, and research and development tax credits related to the United Kingdom’s Research and Development Expenditure Credit scheme, which is a government tax incentive designed to reward innovative companies for investing in research and development. Such incentives are recorded as other income when it is probable the amounts are collectible and can be reasonably estimated. For the three months ended March 31, 2022 and 2021, the Company recorded grant income and research & development tax credits of $284 thousand and $433 thousand, respectively. As of March 31, 2022, and December 31, 2021, the Company had receivables related to research & development tax credits for payments not yet received of $1,324 thousand and $1,070 thousand, respectively.
Share-based compensation	Share-based compensation All share-based payments, including grants of stock options, are measured based on the fair value of the share-based awards at the grant date and recognized over their respective vesting periods. Outstanding options generally expire 10 years after the grant date. The Company has issued options that vest based on service requirements and issued options that vest based on performance requirements. Options become exercisable when service requirements are met. In the case of performance based options, options become exercisable when there is a liquidity event, such as a change in control or sale or admission (listing as a public company or initial public offering (“IPO”)), and the employee, or consultant, must be providing services to the Company at the time of the event. Due to the Exchange, all options outstanding immediately prior to the event with a performance obligation requirement became vested and exercisable. The estimated fair value of stock options at the grant date is determined using the Black-Scholes pricing model. The Black-Scholes option pricing model requires inputs such as the fair value of common stock on date of grant, expected term, expected volatility, dividend yield, and risk-free interest rate. The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and management uses different assumptions, stock-based compensation expense could be materially different for future awards. The Company records forfeitures when they occur.
Functional Currency and Operations	Functional Currency and Operations Prior to the Exchange, SmartKem Limited’s (“the predecessor’s”) functional currency was the British Pound Sterling (“GBP”), and the consolidated financial statements were presented in United States dollars (“USD”). The predecessor’s functional currency was the respective local currency of the primary economic environment in which an entity’s operations are conducted. The predecessor translated the financial statements into the presentation currency using exchanges rates in effect on the balance sheet date for assets and liabilities and average exchanges rates for the period for statement of operations accounts, with the difference recognized in accumulated other comprehensive income /(loss). From the date of the Exchange forward, the Company’s functional currency is the U.S. dollar (“USD”). The functional currency of the Company’s foreign operation is the respective local currency. Assets and liabilities of foreign operation denominated in local currencies are translated at the spot rate in effect at the applicable reporting date. The condensed consolidated statements of operations and comprehensive loss are translated at the weighted average rate of exchange during the applicable period. The resulting unrealized gain/loss is recognized as foreign currency translation as a component of other comprehensive income.
Income Taxes	Income Taxes Income taxes are recorded in accordance with ASC 740, Income Taxes The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. The Company recognizes any interest and penalties accrued related to unrecognized tax benefits as income tax expense. As of March 31, 2022 and December 31, 2021, there were no accruals for uncertain tax positions.
Contingent Liabilities	Contingent Liabilities A provision for contingent liabilities is recorded when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. With respect to legal matters, provisions are reviewed and adjusted to reflect the impact of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter. The Company is a party to certain litigation and disputes arising in the normal course of business. As of March 31, 2022, the Company does not expect that such matters will have a material adverse effect on the Company’s business, financial position, results of operations, or cash flows.
Offering Costs	Offering Costs Direct and incremental legal and accounting costs associated with the Company’s issuance of common stock and warrants are deferred and classified as a component of other assets on the condensed consolidated balance sheet until completion of the issuance. Upon completion of the issuance, deferred offering costs are reclassified from other assets to equity and recorded against the net proceeds received in the issuance. For the three months ended March 31, 2022 and 2021 respectively, $160 thousand and $2,454 thousand of offering costs were recorded in additional paid-in capital.
Segment Information	Segment Information The Company has determined that it operates and reports in one segment
Basic and Diluted Loss Per Share	Basic and Diluted Loss Per Share Basic and diluted net loss per share is determined by dividing net loss by the weighted average ordinary shares outstanding during the period. For all periods presented with a net loss, the shares underlying the ordinary share options and warrants have been excluded from the calculation because their effect would be anti-dilutive. Therefore, the weighted-average shares outstanding used to calculate both basic and diluted loss per share are the same for periods with a net loss. The loss per share information in these unaudited interim condensed consolidated financial statements is reflected and calculated as if the Company had existed since January 1, 2020. Accordingly, loss per share for all periods was calculated based on the number of shares retroactively adjusted for the exchange ratio determined in the reverse recapitalization (see also note 1). The Company has 2,168,000 pre-funded common stock warrants outstanding as of March 31, 2022, which became exercisable on April 23, 2021 based on terms and conditions of the agreements. As the pre-funded common stock warrants are exercisable for $0.01, these shares are considered outstanding common shares and included in computation of basic and diluted Earnings Per Share as the exercise of the pre-funded common stock warrants is virtually assured. The Company included these pre-funded common stock warrants in basic and diluted earnings per share when all conditions were met on April 23, 2021. The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding as they would be anti-dilutive: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ 2022 2021 Options ​ ​ 1,953,882 ​ ​ 1,546,562 Warrants ​ 985,533 ​ 3,153,533 Total ​ ​ 2,939,415 ​ ​ 4,700,095
Recent Accounting Pronouncements	Recent Accounting Pronouncements Adopted In May 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2021-04, Issuer's Accounting for Certain Modifications or Exchanges of Freestanding Equity Classified Written Call Options general, if the fair value of the "new" instrument is greater than the fair value of the "original" instrument, the excess is recognized based on the substance of the transaction, as if the issuer has paid cash. The effective date of the standard is for interim and annual reporting periods beginning after December 15, 2021 for all entities, and early adoption is permitted. The Company adopted ASU 2021-04 on January 1, 2022. As a result of Management’s evaluation, the adoption of ASU 2021-04 did not have a material impact on the consolidated financial statements. In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832) ("ASU 2021-10"), which provides guidance on disclosing government assistance. Under the new guidance, the Company is required to including the disclosure of (1) the types of assistance, (2) an entity's accounting for the assistance, and (3) the effect of the assistance on the entity's financial statements. The effective date of the standard is for annual periods beginning after December 15, 2021. The Company adopted ASU 2021-10 on January 1, 2022. As a result of Management’s evaluation, the adoption of ASU 2021-10 did not have a material on the consolidated financial statements. Recent Accounting Pronouncements Not Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments: Credit Losses (Topic 326)
Reclassification	Reclassifications Certain amounts in prior periods' interim condensed consolidated financial statements have been reclassified to conform to the current period’s presentation.

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	3 Months Ended
	Mar. 31, 2022
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Schedule of Antidilutive Securities	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ 2022 2021 Options ​ ​ 1,953,882 ​ ​ 1,546,562 Warrants ​ 985,533 ​ 3,153,533 Total ​ ​ 2,939,415 ​ ​ 4,700,095

PREPAID EXPENSES AND OTHER CU_2

PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables)	3 Months Ended
	Mar. 31, 2022
PREPAID EXPENSES AND OTHER CURRENT ASSETS
Schedule of Prepaid Expenses and Other Current Assets	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ 2022 2021 Prepaid service charges and property taxes ​ $ 74 ​ $ 58 Prepaid utilities ​ 6 ​ 51 Prepaid insurance ​ 805 ​ 412 Prepaid administrative expenses ​ 149 ​ 63 Prepaid technical fees ​ ​ 72 ​ ​ 141 Prepaid consulting fees ​ ​ 51 ​ ​ 27 VAT receivable ​ 107 ​ 50 Other Receivable and other prepaid expenses ​ ​ 1 ​ ​ — Total prepaid expenses and other current assets ​ $ 1,265 ​ $ 802

PROPERTY, PLANT AND EQUIPMENT (

PROPERTY, PLANT AND EQUIPMENT (Tables)	3 Months Ended
	Mar. 31, 2022
PROPERTY, PLANT AND EQUIPMENT
Schedule of Property, Plant and Equipment	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ 2022 2021 Plant and equipment ​ $ 1,635 ​ $ 1,633 Furniture and fixtures ​ 239 ​ 245 Computer hardware and software ​ 26 ​ 26 ​ ​ 1,900 ​ 1,904 Less: Accumulated depreciation ​ (1,130) ​ (1,102) Property, plant and equipment, net ​ $ 770 ​ $ 802

ACCOUNTS PAYABLE AND ACCRUED _2

ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables)	3 Months Ended
	Mar. 31, 2022
ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Schedule of Accounts Payable and Accrued Expenses	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ 2022 2021 Accounts payable ​ $ 381 ​ $ 510 Accrued expenses – lab refurbishments ​ 128 ​ 131 Accrued expenses – technical fees ​ 76 ​ 66 Accrued expenses – variable rent & utilities ​ 6 ​ 20 Accrued expenses – audit & accounting fees ​ 181 ​ 191 Accrued expenses – other ​ 60 ​ 112 Credit card liabilities ​ 13 ​ 10 Payroll and social security liabilities ​ 315 ​ 383 Total accounts payable and accrued expenses ​ $ 1,160 ​ $ 1,423

LEASES (Tables)

LEASES (Tables)	3 Months Ended
	Mar. 31, 2022
LEASES
Schedule of Lease Costs	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 2021 Operating lease cost ​ $ 63 ​ $ 47 Short-term lease cost ​ 2 ​ 13 Variable lease cost ​ 54 ​ 23 Total lease cost ​ $ 119 ​ $ 83 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 2021 Research and development ​ $ 113 ​ $ 70 Selling, general and administrative ​ 6 ​ 13 Total lease cost ​ $ 119 ​ $ 83
Schedule of Operating Lease Assets And Liabilities	​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ 2022 2021 Assets ​ ​ ​ Operating lease right of use assets ​ $ 90 ​ $ 154 Total lease assets ​ $ 90 ​ $ 154 Liabilities ​ ​ Current liabilities: ​ ​ Operating lease liability – current portion ​ $ 56 ​ $ 87 Noncurrent liabilities: ​ ​ ​ Operating lease liability, net of current portion ​ 19 ​ 28 Total lease liabilities ​ $ 75 ​ $ 115
Schedule of Operating Lease Cash Flow Information	​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 2021 Operating cash outflows from operating leases $ 40 ​ $ 55 Supplemental non-cash amounts of operating lease liabilities arising from obtaining right of use assets $ — ​ $ —
Schedule of Weighted Average Remaining Lease Term and Weighted Average Discount Rate	​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 ​ ​ 2021 ​ Weighted average remaining lease term (in years) – operating leases 1.42 ​ 1.10 Weighted average discount rate – operating leases 6.03 % ​ 6.30 %
Schedule of Operating Lease, Liability, Maturity	​ ​ ​ ​ ​ ​ As of ​ ​ March 31, ​ ​ 2022 2022 ​ $ 50 2023 ​ 22 2024 ​ 7 2025 ​ — 2026 ​ — Thereafter ​ — Total undiscounted lease payments ​ 79 Less imputed interest ​ (4) Total net lease liabilities ​ $ 75

STOCKHOLDERS' EQUITY (Tables)

STOCKHOLDERS' EQUITY (Tables)	3 Months Ended
	Mar. 31, 2022
Common Stock Warrants
Schedule of Warrants	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ ​ ​ ​ ​ ​ ​ Average ​ ​ ​ ​ Weighted- ​ Remaining ​ ​ ​ ​ Average ​ Contractual ​ ​ Number of ​ Exercise ​ Term ​ ​ Shares ​ Price ​ (Years) Warrants outstanding at January 1, 2022 985,533 ​ $ 2.00 4.15 Exercised — ​ — — Forfeited or Expired — ​ — — Granted — ​ - — Warrants outstanding at March 31, 2022 985,533 ​ $ 2.00 3.90
Pre Funded Warrants
Schedule of Warrants	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ ​ ​ ​ Average ​ ​ Number of ​ Exercise ​ ​ Shares ​ Price Pre-funded warrants outstanding at January 1, 2022 2,168,000 ​ $ 0.01 Exercised — ​ — Forfeited or Expired — ​ — Granted — ​ ​ Pre-funded warrants outstanding at March 31, 2022 2,168,000 ​ $ 0.01

SHARE-BASED COMPENSATION (Table

SHARE-BASED COMPENSATION (Tables)	3 Months Ended
	Mar. 31, 2022
SHARE-BASED COMPENSATION
Summary of non-vested share option activity under the share option plans	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Average ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ Remaining ​ Weighted- ​ Aggregate ​ ​ ​ ​ Average ​ Contractual ​ Average ​ Intrinsic ​ ​ Number of ​ Exercise ​ Term ​ Fair Value at ​ Value ​ ​ Shares ​ Price ​ (Years) ​ Grant Date ​ (in thousands) Options outstanding at January 1, 2022 1,953,882 ​ $ 1.72323 9.31 ​ $ 1.12355 ​ $ ​ Exercised — ​ — ​ ​ ​ ​ Cancelled — ​ — ​ ​ ​ ​ Forfeited ​ — ​ ​ — ​ ​ ​ ​ ​ ​ ​ ​ Granted — ​ — ​ ​ ​ ​ Options outstanding at March 31, 2022 1,953,882 ​ $ 1.72323 9.06 ​ $ 1.12355 ​ $ ​ Options exercisable at March 31, 2022 ​ 622,549 ​ $ 1.13134 ​ 8.95 ​ ​ ​ ​ $ 1,475 Vested and expected to vest after March 31, 2022 ​ 1,953,882 ​ $ 1.72323 ​ 9.06 ​ ​ ​ ​ $ 3,472
Schedule of stock-based compensation	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ ​ 2022 2021 Research and development ​ $ 40 ​ $ 2,908 Selling, general and administrative ​ 58 ​ 3,112 Total ​ $ 98 ​ $ 6,020

SELLING, GENERAL AND ADMINIST_2

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (Tables)	3 Months Ended
	Mar. 31, 2022
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Schedule of Selling, general and administrative expenses	​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 2021 Salaries and benefits ​ $ 500 ​ $ 3,734 Rent and property tax expense ​ 28 ​ 13 Insurance ​ ​ 166 ​ ​ 81 Utilities ​ 1 ​ 1 Sales and marketing ​ 187 ​ 22 Legal and professional fees ​ 289 ​ 122 Other selling, general, and administrative expenses ​ 69 ​ 10 Total ​ $ 1,240 ​ $ 3,983

DEFINED CONTRIBUTION PENSION (T

DEFINED CONTRIBUTION PENSION (Tables)	3 Months Ended
	Mar. 31, 2022
DEFINED CONTRIBUTION PENSION
Schedule of pension cost	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended March 31, ​ 2022 2021 Research and development ​ $ 27 ​ $ 23 Selling, general and administrative ​ 14 ​ 8 Total pension cost ​ $ 41 ​ $ 31

BUSINESS AND BASIS OF PREPARA_2

BUSINESS AND BASIS OF PREPARATION - Going Concern and Reverse Recapitalization (Details) $ / shares in Units, $ in Thousands	Feb. 23, 2021$ / sharesshares	Mar. 31, 2022USD ($)patent$ / shares	Mar. 31, 2021USD ($)	Dec. 31, 2021USD ($)$ / shares
Net loss | $		$ (2,762)	$ (9,366)
Accumulated deficit | $		77,834		$ 75,072
Cash and cash equivalents | $		$ 10,647		$ 12,226
Common shares, par value | $ / shares		$ 0.0001		$ 0.0001
Number of issued patents | patent		120
Securities Exchange Agreement, Smartkem Limited
Purchase price (in dollars per share) | $ / shares	$ 1.40
Common shares, par value | $ / shares	$ 0.0001
Share exchange ratio	0.0676668
Securities Exchange Agreement, Smartkem Limited | Common stock A Shares
Share exchange ratio	0.0111907
Share exchange, number of shares issued or issuable	12,725,000
Shares exchange, number of shares exchanged	1,127,720,477
Management incentive options to purchase	124,497,910
Average share exchange ratio	0.011283825
Effect of reverse capitalization (in shares)	2,500,000

SUMMARY OF SIGNIFICANT ACCOUN_4

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022USD ($)segment$ / sharesshares	Mar. 31, 2021USD ($)	Dec. 31, 2021USD ($)shares	Feb. 23, 2021$ / shares
Class of Warrant or Right [Line Items]
Cash equivalents	$ 0		$ 0
Allowance for doubtful accounts	0		0
Other operating income	284	$ 433
Uncertain tax positions	0		0
Research & development tax credits	1,324		1,070
Stock-based compensation expense	$ 98	6,020
Expiration term	10 years
Deferred offering costs	$ 0		$ 0
Number of operating segments | segment	1
Number of reportable segments | segment	1
Offering costs recorded in additional paid-in capital	$ 160	2,454
Transaction expenses		$ 1,314
Pre Funded Warrants
Class of Warrant or Right [Line Items]
Common stock warrants outstanding | shares	2,168,000		2,168,000
Warrants exercisable price | $ / shares	$ 0.01			$ 0.01

SUMMARY OF SIGNIFICANT ACCOUN_5

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Dilutive Securities (Details) - shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	2,939,415	4,700,095
Options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	1,953,882	1,546,562
Warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	985,533	3,153,533

PREPAID EXPENSES AND OTHER CU_3

PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid service charges and property taxes	$ 74	$ 58
Prepaid utilities	6	51
Prepaid insurance	805	412
Prepaid administrative expenses	149	63
Prepaid technical fees	72	141
Prepaid consulting fees	51	27
VAT receivable	107	50
Other Receivable and other prepaid expenses	1
Total prepaid expenses and other current assets	1,265	802
Prepaid Insurance Noncurrent	$ 204	$ 217

PROPERTY, PLANT AND EQUIPMENT_2

PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	$ 1,900		$ 1,904
Less: Accumulated depreciation	(1,130)		(1,102)
Property, plant and equipment, net	770		802
Depreciation	54	$ 48
Plant and equipment
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	1,635		1,633
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	239		245
Computer hardware and software
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	26		$ 26
Research and development
Property, Plant and Equipment [Line Items]
Depreciation	$ 54	$ 48

ACCOUNTS PAYABLE AND ACCRUED _3

ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts payable	$ 381	$ 510
Accrued expenses - lab refurbishments	128	131
Accrued expenses - technical fees	76	66
Accrued expenses - variable rent & utilities	6	20
Accrued expenses - audit & accounting fees	181	191
Accrued expenses - other	60	112
Credit card liabilities	13	10
Payroll and social security liabilities	315	383
Total accounts payable and accrued expenses	$ 1,160	$ 1,423

LEASES - Lease Costs (Details)

LEASES - Lease Costs (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Operating lease cost	$ 63	$ 47
Short-term lease cost	2	13
Variable lease cost	54	23
Total lease cost	119	83
Research and development
Total lease cost	113	70
Selling, general and administrative
Total lease cost	$ 6	$ 13

LEASES - Lease Assets And Liabi

LEASES - Lease Assets And Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Assets
Operating lease right of use assets	$ 90	$ 154
Total lease assets	90	154
Current liabilities:
Operating lease liability - current portion	56	87
Noncurrent liabilities:
Operating lease liability, net of current portion	19	28
Total net lease liabilities	$ 75	$ 115

LEASES - Operating And Finance

LEASES - Operating And Finance Leases (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
LEASES
Operating cash flows from operating leases	$ 40	$ 55

LEASES - Weighted Average (Deta

LEASES - Weighted Average (Details)	Mar. 31, 2022	Mar. 31, 2021
LEASES
Weighted average remaining lease term (in years) - operating leases	1 year 5 months 1 day	1 year 1 month 6 days
Weighted average discount rate - operating leases	6.03%	6.30%

LEASES - Undiscounted Operating

LEASES - Undiscounted Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
2022	$ 50
2023	22
2024	7
Total undiscounted lease payments	79
Less imputed interest	(4)
Total net lease liabilities	$ 75	$ 115

LEASES - Additional Information

LEASES - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Sublease rental income	$ 0	$ 0
Finance lease, right-of-use assets	0		$ 0
Finance lease, liabilities	$ 0		$ 0
Minimum
Operating leases terms	1 year
Maximum
Operating leases terms	3 years

NOTES PAYABLE - Additional Info

NOTES PAYABLE - Additional Information (Details) - Term Loan Facility Agreement - USD ($) $ in Thousands	Jan. 26, 2021	Mar. 31, 2022	Mar. 31, 2021
Debt Instrument [Line Items]
Effective interest rate			26.20%
Aggregate principal	$ 739
Debt term	6 months
Monthly interest rate	1.25%
Notes payable		$ 0
Interest expense of notes payable		$ 0	$ 19

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2022USD ($)
COMMITMENTS AND CONTINGENCIES.
Capital expenditures to be paid in the future	$ 1,350

STOCKHOLDERS' EQUITY (Details)

STOCKHOLDERS' EQUITY (Details)	3 Months Ended
	Mar. 31, 2022Voteshares
STOCKHOLDERS' EQUITY
Preferred shares, outstanding (in shares)	0
Preferred stock available for issuance	10,000,000
Number of votes, common shares | Vote	1

STOCKHOLDERS' EQUITY - Common S

STOCKHOLDERS' EQUITY - Common Stock Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands	Feb. 23, 2021	Mar. 31, 2022
Common Stock Warrants
Number of shares
Warrants outstanding beginning (in shares)		985,533
Exercised (in shares)		0
Warrants outstanding at end (in shares)		985,533
Weighted-Average Exercise Price
Warrants outstanding beginning (in dollars per share)		$ 2
Warrants outstanding at end (in dollars per share)		$ 2
Weighted Average Remaining Contractual Term (years)
Warrants outstanding at beginning		4 years 1 month 24 days
Warrants outstanding at end		3 years 10 months 24 days
Warrants issued	985,533	0
Warrants exercisable price	$ 2	$ 0.91
Fair value of warrant		$ 896
Pre Funded Warrants
Number of shares
Warrants outstanding beginning (in shares)		2,168,000
Warrants outstanding at end (in shares)		2,168,000
Weighted-Average Exercise Price
Warrants outstanding beginning (in dollars per share)		$ 0.01
Warrants outstanding at end (in dollars per share)		$ 0.01
Weighted Average Remaining Contractual Term (years)
Warrants issued	2,168,000	0
Warrants exercisable price	$ 0.01	$ 0.01
Fair value of per warrant		1.99
Exercise less amount		$ 2
Proceeds from Warrant	$ 4,314

SHARE-BASED COMPENSATION - Shar

SHARE-BASED COMPENSATION - Share option activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Number of Shares
Options outstanding at beginning (in shares)	1,953,882	1,810,749
Options outstanding at end (in shares)	1,953,882	1,953,882
Options exercisable (in shares)	622,549
Vested and expected to vest (in shares)	1,953,882
Weighted-Average Exercise Price
Options outstanding at beginning (in dollars per share)	$ 1.72323
Options outstanding at end (in dollars per share)	1.72323	$ 1.72323
Options exercisable (in dollars per share)	1.13134
Vested and expected to vest (in dollars per share)	$ 1.72323
Weighted-Average Remaining Contractual Term :
Weighted-Average Remaining Contractual Term (in Years)	9 years 21 days	9 years 3 months 21 days
Options exercisable weighted average remaining contractual term	8 years 11 months 12 days
Vested and expected to vest outstanding weighted average remaining contractual term	9 years 21 days
Weighted- Average Fair Value at Grant Date :
Weighted- Average Fair Value at Grant Date at beginning (in dollars)	$ 1.12355
Weighted- Average Fair Value at Grant Date at end (in dollars)	$ 1.12355	$ 1.12355
Aggregate Intrinsic Value, Options exercisable	$ 1,475
Aggregate Intrinsic Value, Vested and expected to vest	$ 3,472

SHARE-BASED COMPENSATION - Stoc

SHARE-BASED COMPENSATION - Stock Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total	$ 98	$ 6,020
Research and development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total	40	2,908
Selling, general and administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total	$ 58	$ 3,112

SHARE-BASED COMPENSATION - Addi

SHARE-BASED COMPENSATION - Additional information (Details) - USD ($) $ / shares in Units, $ in Thousands	Feb. 28, 2021	Feb. 23, 2021	Mar. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration term			10 years
Exercisable options (in shares)			622,549
Unrecognized compensation costs			$ 1,234
Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration term	10 years
Options | Exercise Price Range One
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted (in shares)	336,557
Granted (in dollars per share)	$ 0.001
Options | Exercise Price Range Two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted (in shares)	66,029
Granted (in dollars per share)	$ 2
Investment Agreement | Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration term			10 years
2021 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted (in shares)		2,275,000	0
Percentage of outstanding shares		4.00%
2021 Plan | Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted (in shares)	402,586

SELLING, GENERAL AND ADMINIST_3

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Salaries and benefits	$ 500	$ 3,734
Rent and property tax expense	28	13
Insurance	166	81
Utilities	1	1
Sales and marketing	187	22
Legal and professional fees	289	122
Other selling, general, and administrative expenses	69	10
Total	$ 1,240	$ 3,983

DEFINED CONTRIBUTION PENSION (D

DEFINED CONTRIBUTION PENSION (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
DEFINED CONTRIBUTION PENSION
Amounts owed to the pension scheme	$ 0	$ 0

DEFINED CONTRIBUTION PENSION -

DEFINED CONTRIBUTION PENSION - Pension cost (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
DEFINED CONTRIBUTION PENSION
Total pension cost	$ 41	$ 31
Research and development
DEFINED CONTRIBUTION PENSION
Total pension cost	27	23
Selling, general and administrative
DEFINED CONTRIBUTION PENSION
Total pension cost	$ 14	$ 8

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details) - USD ($) $ / shares in Units, $ in Thousands	Jan. 27, 2022	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Accounts payable and accrued expenses [Member]
Related Party Transaction [Line Items]
Related party payable		$ 9		$ 18
Selling, general and administrative
Related Party Transaction [Line Items]
Related party expenses		$ 18	$ 7
Octopus Share Purchase [Member]
Related Party Transaction [Line Items]
Sale of Stock, Number of Shares Issued in Transaction	1,000,000
Sale of Stock, Price Per Share	$ 2