Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Aug. 06, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | PROVECTUS BIOPHARMACEUTICALS, INC. | |
Entity Central Index Key | 0000315545 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Amendment Flag | false | |
Entity Reporting Status Current | Yes | |
Entity Interactive Data Current | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 387,591,975 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2019 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Current Assets: | ||
Cash and cash equivalents | $ 1,324,228 | $ 50,986 |
Short-term receivables - legal fees, settlement and other, net | 292,713 | 595,326 |
Prepaid expenses | 242,415 | 370,209 |
Total Current Assets | 1,859,356 | 1,016,521 |
Equipment and furnishings, less accumulated depreciation of $57,584 and $50,538, respectively | 65,430 | 72,476 |
Operating lease right-of-use asset | 229,975 | |
Patents, net of accumulated amortization of $11,151,778 and $10,816,218, respectively | 563,667 | 899,227 |
Total Assets | 2,718,428 | 1,988,224 |
Current Liabilities: | ||
Accounts payable - trade | 1,554,095 | 3,312,049 |
Other accrued expenses | 1,042,042 | 790,358 |
Current portion of operating lease liability | 74,930 | |
Total Current Liabilities | 2,671,067 | 4,102,407 |
Accrued interest | 1,074,681 | 659,379 |
Accrued interest - related parties | 987,649 | 711,927 |
Convertible notes payable | 11,887,000 | 7,062,000 |
Convertible notes payable - related parties | 6,895,000 | 6,870,000 |
Non-current portion of operating lease liability | 168,123 | |
Total Liabilities | 23,683,520 | 19,405,713 |
Commitments and contingencies (Note 8) | ||
Stockholders' Deficiency: | ||
Preferred stock; par value $0.001 per share; 25,000,000 shares authorized; Series B Convertible Preferred Stock; 240,000 shares designated; 100 shares issued and outstanding at June 30, 2019 and December 31, 2018; aggregate liquidation preference of $3,500 at June 30, 2019 and December 31, 2018 | ||
Common stock; par value $0.001 per share; 1,000,000,000 shares authorized; 384,906,118 and 384,614,528 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively | 384,906 | 384,615 |
Additional paid-in capital | 209,116,301 | 209,092,187 |
Accumulated other comprehensive loss | (24,859) | |
Accumulated deficit | (230,441,440) | (226,894,291) |
Total Stockholders' Deficiency | (20,965,092) | (17,417,489) |
Total Liabilities and Stockholders' Deficiency | $ 2,718,428 | $ 1,988,224 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Accumulated depreciation on equipment and furnishings | $ 57,584 | $ 50,538 |
Accumulated amortization on patents | $ 11,151,778 | $ 10,816,218 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
Aggregate liquidation preference | $ 3,500 | $ 3,500 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 384,906,118 | 384,614,528 |
Common stock, shares outstanding | 384,906,118 | 384,614,528 |
Series B Convertible Preferred Stock [Member] | ||
Preferred stock, shares authorized | 240,000 | 240,000 |
Preferred stock, shares issued | 100 | 100 |
Preferred stock, shares outstanding | 100 | 100 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Operating Expenses: | ||||
Research and development | $ 1,208,324 | $ 987,239 | $ 2,245,655 | $ 2,930,302 |
General and administrative | 631,063 | 1,107,737 | 1,390,316 | 1,863,887 |
Total Operating Expenses | 1,839,387 | 2,094,976 | 3,635,971 | 4,794,189 |
Total Operating Loss | (1,839,387) | (2,094,976) | (3,635,971) | (4,794,189) |
Other Income/(Expense): | ||||
Gain on settlement of lawsuits | 825,000 | 675,000 | 825,000 | |
Research and development tax credit | (1,131) | 42,685 | 82,941 | 42,685 |
Investment and interest income | 19,650 | 5,556 | 21,905 | 11,725 |
Interest expense | (356,451) | (234,473) | (691,024) | (441,041) |
Net Loss | $ (2,177,319) | $ (1,456,208) | $ (3,547,149) | $ (4,355,820) |
Basic and Diluted Loss Per Common Share | $ (0.01) | $ 0 | $ (0.01) | $ (0.01) |
Weighted Average Number of Common Shares Outstanding - Basic and Diluted | 384,773,639 | 381,574,365 | 384,769,219 | 379,483,491 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||||
Net Loss | $ (2,177,319) | $ (1,456,208) | $ (3,547,149) | $ (4,355,820) |
Other Comprehensive Loss: | ||||
Foreign currency translation adjustments | (2,496) | (24,859) | ||
Total Comprehensive Loss | $ (2,179,815) | $ (1,456,208) | $ (3,572,008) | $ (4,355,820) |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Changes in Stockholders' Deficiency (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Preferred Stock Series B [Member] | ||||||
Beginning Balance | ||||||
Beginning Balance, shares | 100 | 100 | 100 | 100 | 100 | 100 |
Common stock issued upon exercise of warrants | ||||||
Common stock issued upon exercise of warrants, shares | ||||||
Common stock issued for services | ||||||
Common stock issued for services, shares | ||||||
Warrants issued for services | ||||||
Common stock issued in lieu of accounts payable | ||||||
Common stock issued in lieu of accounts payable, shares | ||||||
Net loss | ||||||
Other comprehensive loss | ||||||
Ending Balance | ||||||
Ending Balance, shares | 100 | 100 | 100 | 100 | 100 | 100 |
Common Stock [Member] | ||||||
Beginning Balance | $ 384,715 | $ 384,615 | $ 378,889 | $ 370,962 | $ 384,615 | $ 370,962 |
Beginning Balance, shares | 384,714,528 | 384,614,528 | 378,888,190 | 370,961,451 | 384,614,528 | 370,961,451 |
Common stock issued upon exercise of warrants | $ 100 | $ 3,222 | $ 7,927 | |||
Common stock issued upon exercise of warrants, shares | 100,000 | 3,222,838 | 7,926,739 | |||
Common stock issued for services | $ 191 | |||||
Common stock issued for services, shares | 191,590 | |||||
Warrants issued for services | ||||||
Common stock issued in lieu of accounts payable | $ 1,000 | |||||
Common stock issued in lieu of accounts payable, shares | 1,000,000 | |||||
Net loss | ||||||
Other comprehensive loss | ||||||
Ending Balance | $ 384,906 | $ 384,715 | $ 383,111 | $ 378,889 | $ 384,906 | $ 383,111 |
Ending Balance, shares | 384,906,118 | 384,714,528 | 383,111,028 | 378,888,190 | 384,906,118 | 383,111,028 |
Additional Paid-In Capital [Member] | ||||||
Beginning Balance | $ 209,097,417 | $ 209,092,187 | $ 208,765,999 | $ 208,351,431 | $ 209,092,187 | $ 208,351,431 |
Common stock issued upon exercise of warrants | 5,230 | 168,556 | 414,568 | |||
Common stock issued for services | 8,771 | |||||
Warrants issued for services | 10,113 | |||||
Common stock issued in lieu of accounts payable | 79,000 | |||||
Net loss | ||||||
Other comprehensive loss | ||||||
Ending Balance | 209,116,301 | 209,097,417 | 209,013,555 | 208,765,999 | 209,116,301 | 209,013,555 |
Accumulated Other Comprehensive Loss [Member] | ||||||
Beginning Balance | (22,363) | |||||
Common stock issued upon exercise of warrants | ||||||
Common stock issued for services | ||||||
Warrants issued for services | ||||||
Net loss | ||||||
Other comprehensive loss | (2,496) | (22,363) | ||||
Ending Balance | (24,859) | (22,363) | (24,859) | |||
Accumulated Deficit [Member] | ||||||
Beginning Balance | (228,264,121) | (226,894,291) | (221,640,848) | (218,741,236) | (226,894,291) | (218,741,236) |
Common stock issued upon exercise of warrants | ||||||
Common stock issued for services | ||||||
Warrants issued for services | ||||||
Common stock issued in lieu of accounts payable | ||||||
Net loss | (2,177,319) | (1,369,830) | (1,456,208) | (2,899,612) | ||
Other comprehensive loss | ||||||
Ending Balance | (230,441,440) | (228,264,121) | (223,097,056) | (221,640,848) | (230,441,440) | (223,097,056) |
Beginning Balance | (18,804,352) | (17,417,489) | (12,495,960) | (10,018,843) | (17,417,489) | (10,018,843) |
Common stock issued upon exercise of warrants | 5,330 | 171,778 | 422,495 | |||
Common stock issued for services | 8,962 | |||||
Warrants issued for services | 10,113 | |||||
Common stock issued in lieu of accounts payable | 80,000 | |||||
Net loss | (2,177,319) | (1,369,830) | (1,456,208) | (2,899,612) | (3,547,149) | (4,355,820) |
Other comprehensive loss | (2,496) | (22,363) | (24,859) | |||
Ending Balance | $ (20,965,092) | $ (18,804,352) | $ (13,700,390) | $ (12,495,960) | $ (20,965,092) | $ (13,700,390) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash Flows From Operating Activities: | ||
Net loss | $ (3,547,149) | $ (4,355,820) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation | 19,075 | 80,000 |
Depreciation | 42,622 | 7,047 |
Amortization of patents | 335,560 | 335,560 |
Changes in operating assets and liabilities | ||
Settlement receivable | 49,863 | (533,926) |
Prepaid expenses | 127,794 | 126,864 |
Accounts payable - trade | (1,757,954) | 229,962 |
Other accrued expenses and lease liability | 481,936 | 261,484 |
Accrued interest expense | 691,024 | 373,684 |
Net Cash Used In Operating Activities | (3,557,229) | (3,475,145) |
Cash Flows From Financing Activities: | ||
Proceeds from issuance of convertible notes payable | 4,825,000 | 1,956,000 |
Proceeds from issuance of convertible notes payable - related parties | 25,000 | 950,000 |
Proceeds from exercise of warrants | 5,330 | 594,274 |
Net Cash Provided By Financing Activities | 4,855,330 | 3,500,274 |
Effect of Exchange Rate Changes on Cash | (24,859) | |
Net Increase In Cash and Cash Equivalents | 1,273,242 | 25,129 |
Cash and Cash Equivalents, Beginning of Period | 50,986 | 105,504 |
Cash and Cash Equivalents, End of Period | 1,324,228 | 130,633 |
Supplemental Disclosures of Cash Flow Information: | ||
Interest | ||
Taxes | ||
Non-cash investing and financing activities: | ||
Offset of related party receivable and payable | $ 252,750 |
Business Organization, Nature o
Business Organization, Nature of Operations and Basis of Presentation | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Organization, Nature of Operations and Basis of Presentation | 1. Business Organization, Nature of Operations and Basis of Presentation Provectus Biopharmaceuticals, Inc., a Delaware corporation (together with its subsidiaries, “Provectus” or the “Company”), is a clinical-stage biotechnology company that is developing a new class of drugs for oncology, hematology, and dermatology based on an entire, wholly-owned, family of small molecules called halogenated xanthenes: ● Oncology: PV-10 is also undergoing preclinical study for pediatric solid tumor cancers (including neuroblastoma, Ewing sarcoma, rhabdomyosarcoma, and osteosarcoma). Orphan drug designation status has been granted to PV-10 by the FDA for neuroblastoma in 2018. ● Hematology. ● Dermatology: To date, the Company has not generated any revenues from planned principal operations. The Company’s activities are subject to significant risks and uncertainties, including failing to successfully develop and license or commercialize the Company’s prescription drug candidates. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information pursuant to Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be reviewed in conjunction with the Company’s audited consolidated financial statements included in the Company’s Form 10-K for the year ended December 31, 2018 filed with the SEC on March 7, 2019. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. |
Liquidity and Going Concern
Liquidity and Going Concern | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Liquidity and Going Concern | 2. Liquidity and Going Concern The Company’s cash and cash equivalents were $1,324,228 at June 30, 2019. The Company continues to incur significant operating losses. Management expects that significant on-going operating expenditures will be necessary to successfully implement the Company’s business plan and develop and market its products. These circumstances raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that these financial statements are issued. Implementation of the Company’s plans and its ability to continue as a going concern will depend upon the Company’s ability to develop PV-10 and PH-10, and to raise additional capital. The Company plans to access capital resources through possible public or private equity offerings, including the 2017 Financing (as defined in Note 4), exchange offers, debt financings, corporate collaborations or other means. In addition, the Company continues to explore opportunities to strategically monetize its lead drug candidates, PV-10 and PH-10, through potential co-development and licensing transactions, although there can be no assurance that the Company will be successful with such plans. The Company has historically been able to raise capital through equity offerings, although no assurance can be provided that it will continue to be successful in the future. If the Company is unable to raise sufficient capital through the 2017 Financing or otherwise, it will not be able to pay its obligations as they become due. The primary business objective of management is to build the Company into a commercial-stage biotechnology company; however, the Company cannot assure you that it will be successful in co-developing, licensing, and/or commercializing PV-10, PH-10, and/or any other halogenated xanthene-based drug product candidate developed by the Company, or entering into any commercial financial transaction. Moreover, even if the Company is successful in improving its current cash flow position, the Company nonetheless plans to seek additional funds to meet its long-term requirements in 2019 and beyond. The Company anticipates that these funds will otherwise come from the proceeds of private placement transactions, including the 2017 Financing, the exercise of existing warrants and outstanding stock options, or public offerings of debt or equity securities. While the Company believes that it has a reasonable basis for its expectation that it will be able to raise additional funds, the Company cannot assure you that it will be able to complete additional financing in a timely manner. In addition, any such financing may result in significant dilution to stockholders. |
Critical Accounting Policies
Critical Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Critical Accounting Policies | 3. Critical Accounting Policies Since the date the Company’s December 31, 2018 consolidated financial statements were issued in its 2018 Annual Report, there have been no material changes to the Company’s significant accounting policies, except as disclosed below. Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued a new standard related to leases to increase transparency and comparability among organizations by requiring the recognition of operating lease right-of-use (“ROU”) assets and lease liabilities on the balance sheet (“ASC 842”) with amendments issued in 2018. Most prominent among the changes in the standard is the recognition of ROU assets and lease liabilities by lessees for those leases classified as operating leases. Under the standard, disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. The Company is also required to recognize and measure new leases at the adoption date and recognize a cumulative-effect adjustment in the period of adoption using a modified retrospective approach, with certain practical expedients available. The Company adopted ASC 842 effective January 1, 2019 and elected to apply the available practical expedients. The standard had an impact on the Company’s condensed consolidated balance sheets but did not have a material impact on the Company’s condensed consolidated statements of operations or condensed consolidated statements of cash flows upon adoption. The most significant impact was the recognition of ROU assets and lease liabilities for operating leases, while the Company’s accounting for finance leases remained substantially unchanged. The adoption of ASC 842 did not have a material impact in the current year and prior year comparative periods and as a result, a cumulative-effect adjustment was not required. Reclassifications Certain prior year balances have been reclassified in order to conform to current year presentation. These reclassifications have no effect on previously reported results of operations or loss per share. Stock-Based Compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. The fair value of the award is measured on the grant date and then is recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. The Company computes the fair value of equity-classified warrants and options granted using the Black-Scholes option pricing model. Option valuation models require the input of highly subjective assumptions including the expected volatility factor of the market price of the Company’s common stock which is determined by reviewing its historical public market closing prices. |
Convertible Notes Payable
Convertible Notes Payable | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Convertible Notes Payable | 4. Convertible Notes Payable On March 23, 2017, the Company entered into an exclusive Definitive Financing Commitment Term Sheet with a group of the Company’s stockholders (the “PRH Group”), which was amended and restated effective as of March 19, 2017 (the “Term Sheet”) that set forth the terms on which the PRH Group would use their best efforts to arrange for a financing of a minimum of $10,000,000 and maximum of $20,000,000 (the “2017 Financing”). As of June 30, 2019, the Company had received aggregate loans of $18,782,000 in connection with the 2017 Financing. As of June 30, 2019, and through the date of filing, the Series D Preferred Stock had not been designated by the Company’s Board of Directors (the “Board”). As a result, the Company did not analyze the loan for a potential beneficial conversion feature as the definition of a firm commitment has not been met since the PRH Notes were not convertible as of their respective dates of issuance or as of June 30, 2019. Convertible Notes Payable – Related Parties During the six months ended June 30, 2019, the Company entered into additional related party PRH Notes in the aggregate principal amount of $25,000. As of June 30, 2019, the Company had borrowed $6,895,000 of related party PRH Notes that were outstanding. Convertible Notes Payable – Non-Related Parties During the six months ended June 30, 2019, the Company entered into additional non-related party PRH Notes in the aggregate principal amount of $4,825,000. As of June 30, 2019, the Company had borrowed $11,887,000 of non-related party PRH Notes that were outstanding. |
Receivables
Receivables | 6 Months Ended |
Jun. 30, 2019 | |
Receivables [Abstract] | |
Receivables | 5. Receivables The following table summarizes the receivables at June 30, 2019 and December 31, 2018: June 30, 2019 Legal Fees Settlement Total Gross receivable $ 683,250 $ 1,703,935 $ 2,387,185 Reserve for uncollectibility (455,500 ) (1,649,043 ) (2,104,543 ) Net receivable 227,750 54,892 282,642 Short-term receivable - Settlement - 54,892 54,892 Short-term receivable - Legal 227,750 - 227,750 Long-term receivable $ - $ - $ - December 31, 2018 Legal Fees Settlement Total Gross receivable $ 911,000 $ 1,783,795 $ 2,694,795 Reserve for uncollectibility (455,500 ) (1,649,043 ) (2,104,543 ) Net receivable 455,500 134,752 590,252 Short-term receivable - Settlement - 134,752 134,752 Short-term receivable - Legal $ 455,500 $ - $ 455,500 Long-term receivable - - - During the six months ended June 30, 2019, officers of the Company offset their settlement amounts owed to the Company against accrued payroll and other payables totaling $252,750. This offset reduced the amount of the settlement and was approved by the Company’s Board. |
Stockholders' Deficiency
Stockholders' Deficiency | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Stockholders' Deficiency | 6. Stockholders’ Deficiency Common Stock During the six months ended June 30, 2019, the Company issued an aggregate of 191,590 shares of immediately vested restricted common stock to an employee and consultants with an issuance date fair value of $8,962, which was recognized immediately. Warrants During the six months ended June 30, 2019, the Company issued 387,500 five-year immediately vested warrants to a consultant to purchase an aggregate of 387,500 shares of common stock with exercise prices ranging from $1.00 to $2.00 per share. The warrants had an aggregate grant date fair value of $10,113, which was recognized immediately under stock compensation in general and administrative. In applying the Black-Scholes option pricing model to warrants issued, the Company used the following assumptions: For the Three Month Ended For the Six Months Ended June 30, June 30, 2019 2018 2019 2018 Risk-free interest rate 2.23 % n/a 2.23 % n/a Expected terms (years) 5.00 n/a 5.00 n/a Expected volatility 129 % n/a 129 % n/a Expected dividend yields 0.00 % n/a 0.00 % n/a During the six months ended June 30, 2019, warrant holders exercised warrants to purchase an aggregate of 100,000 shares of common stock at a price of $0.0533 per share. In connection with these exercises, the Company received aggregate cash proceeds of $5,330 and issued 100,000 shares of common stock to the warrant holders. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Leases | 7. Leases The Company currently leases 4,500 square feet of corporate office space in Knoxville, Tennessee through an operating lease agreement for a term of five years ending on June 30, 2022. Payments range from approximately $7,300 to $7,800 per month. Total rent expense for the six months ended June 30, 2019 was $57,134, of which, $38,089 was included within research and development and $19,045 was included within general and administrative expenses on the condensed consolidated statement of operations. Total rent expense for the six months ended June 30, 2018 was $44,233, of which, $29,489 was included within research and development and $14,744 was included within general and administrative expenses on the condensed consolidated statement of operations. Total rent expense during the three months ended June 30, 2019 was $22,329, of which, $14,886 was included within research and development and $7,443 was included within general and administrative expenses on the condensed consolidated statement of operations. Total rent expense during the three months ended June 30, 2018 was $22,080, of which, $14,720 was included within research and development and $7,360 was included within general and administrative expenses on the condensed consolidated statement of operations. As of June 30, 2019, the Company had no leases that were classified as a financing lease. As of June 30, 2019, the Company did not have additional operating and financing leases that have not yet commenced. A summary of the Company’s right-of-use assets and liabilities is as follows: Six Months Ended Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 44,330 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 265,550 Weighted Average Remaining Lease Term Operating leases 3.25 years Weighted Average Discount Rate Operating leases 8.0% Future minimum payments under non-cancellable lease as of June 30, 2019 were as follows: For the Years Ending December 31, Amount 2019 $ 45,785 2020 90,666 2021 92,471 2022 46,687 Total future minimum lease payments 275,609 Less: amount representing imputed interest (32,556 ) Total $ 243,053 |
Commitments, Contingencies and
Commitments, Contingencies and Litigation | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Litigation | 8. Commitments, Contingencies and Litigation Culpepper Travel Expenses and Related Collection Efforts On December 27, 2016, the then-Board of Directors (the “then-Board”) unanimously voted to terminate then-interim Chief Executive Officer, then-Chief Operating Officer, and former Chief Financial Officer, Peter Culpepper (“Culpepper”), effective immediately, from all positions he held with the Company and each of its subsidiaries, “for cause,” in accordance with the terms of the Amended and Restated Executive Employment Agreement entered into by Culpepper and the Company on April 28, 2014 (the “Culpepper Employment Agreement”), based on the results of the investigation conducted by the Audit Committee of the then-Board regarding improper expense reimbursements to Culpepper. The Audit Committee retained independent counsel and an advisory firm with forensic accounting expertise to assist the Audit Committee in conducting the investigation. The Audit Committee found that Culpepper received $294,255 in expense reimbursements that were unsubstantiated or otherwise improper. The Company seeks to recover from Culpepper the entire $294,255 in expense reimbursements, as well as all attorney’s fees and auditors’/experts’ fees incurred by the Company in connection with the examination of his expense reimbursements. On December 12, 2017, Culpepper agreed to an order by the SEC to pay disgorgement of $140,115, and prejudgment interest of $12,261, for a total of $152,376, to the Company within 30 days. The Company received the payment of $152,376 in January 2018. The Company took the position that under the terms of the Culpepper Employment Agreement, Culpepper is owed no severance payments as a result of his termination “for cause” as that term is defined in the Culpepper Employment Agreement. Furthermore, Culpepper is no longer entitled to the 2:1 credit under the Stipulated Settlement Agreement and Mutual Release in the Kleba Derivative Lawsuit Settlement (the “Derivative Lawsuit Settlement”) such that the total $2,240,000 owed by Culpepper pursuant to the Derivative Lawsuit Settlement plus Culpepper’s proportionate share of the litigation cost in the amount of $227,750, less the amount that he repaid as of December 31, 2016, is immediately due and payable. The Company sent Culpepper a notice of default in January 2017 for the total amount he owes the Company and is in the process of pursuing these claims in accordance with the alternative dispute resolution provision of the Culpepper Employment Agreement. The Company has established a reserve of $2,051,083 as of June 30, 2019 and December 31, 2018, which amount represents the amount the Company currently believes Culpepper owes to the Company under the Derivative Lawsuit Settlement (excluding the amount of attorneys’ fees incurred in enforcing the terms of the Derivative Lawsuit Settlement), while the Company pursues collection of this amount. Culpepper disputed that he was terminated “for cause” under the Culpepper Employment Agreement. Pursuant to the alternative dispute resolution provisions of that agreement, the Company and Culpepper participated in a mediation of their dispute on June 28, 2017. Having reached no resolution during the mediation, the parties participated in arbitration under the commercial rules of the American Arbitration Association, arbitrating both Culpepper’s claim for severance against the Company and the Company’s claims against Culpepper for improper expense reimbursements and amounts Culpepper owes the Company under the Derivative Lawsuit Settlement (the “Culpepper Arbitration”). The Culpepper Arbitration hearing was held from May 15 to May 18, 2018. On July 12, 2018, the arbitrator issued an interim award in favor of the Company, the terms of which are confidential pursuant to the Culpepper Employment Agreement and instructed the parties that a final award was forthcoming. On September 12, 2018, the arbitrator issued his final award in favor of the Company. On October 4, 2018, the Company filed a petition with the Chancery Court for Davidson County, Tennessee to confirm the arbitration award. On November 7, 2018, the Company received Culpepper’s answer to the petition filed on October 4, 2018. This court entered an order confirming the arbitrator’s award on January 23, 2019. On February 20, 2019, Culpepper filed a motion to alter or amend this judgment. On March 22, 2019, the Chancery Court upheld the arbitration award in favor of the Company. On April 16, 2019, Culpepper filed a Notice of Appeal with the Tennessee Court of Appeals regarding the judgment confirming the arbitration award and the order denying Culpepper’s motion to alter or amend the judgment (the “Culpepper Appeal”). Culpepper has submitted a Culpepper Appeal brief, and the Company plans to submit a Culpepper Appeal brief in the third quarter of 2019. Wachter Kleba Settlement Agreement Satisfaction Pursuant to the terms and conditions of the Stipulated Settlement Agreement and Mutual Release made and entered into by and between the Company (then-Provectus Pharmaceuticals, Inc.) and Eric A. Wachter, Ph.D. on June 6, 2014, and consented to and approved by Glenn Kleba and Don B. Dale (the “Plaintiffs”), derivatively on behalf of the Company in the Plaintiffs’ shareholder derivative lawsuit (the “Kleba Settlement Agreement”), Dr. Wachter completed prepayment of his Cash Repayment Obligations (as defined in the Kleba Settlement Agreement) on June 28, 2019. Dr. Wachter’s Cash Repayment Obligations equaled (i) the Reduced Repayment Amount (as defined in the Kleba Settlement Agreement) of $1,199,303, including imputed interest, plus (ii) Dr. Wachter’s pro rata portion of the Company’s Litigation Costs (as defined in the Kleba Settlement Agreement) of $227,750, for a total payment to the Company of $1,427,053. Pursuant to the terms and conditions of the Stock Pledge Agreement related to the Kleba Settlement Agreement, satisfaction of his Cash Repayment Obligations removed the Company’s first-priority security interest in 1,000,000 shares of the Company’s common stock beneficially owned by Dr. Wachter, which had served as collateral for the Cash Repayment Obligations owed to the Company. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | 9. Subsequent Events Exercise of Warrants Subsequent to June 30, 2019, warrant holders exercised warrants to purchase an aggregate of 2,985,857 shares of common stock at $0.0533 per share. In connection with these exercises, the Company received aggregate cash proceeds of $159,146 and issued 2,985,857 shares of common stock to the warrant holders. |
Critical Accounting Policies (P
Critical Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Leases | Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued a new standard related to leases to increase transparency and comparability among organizations by requiring the recognition of operating lease right-of-use (“ROU”) assets and lease liabilities on the balance sheet (“ASC 842”) with amendments issued in 2018. Most prominent among the changes in the standard is the recognition of ROU assets and lease liabilities by lessees for those leases classified as operating leases. Under the standard, disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. The Company is also required to recognize and measure new leases at the adoption date and recognize a cumulative-effect adjustment in the period of adoption using a modified retrospective approach, with certain practical expedients available. The Company adopted ASC 842 effective January 1, 2019 and elected to apply the available practical expedients. The standard had an impact on the Company’s condensed consolidated balance sheets but did not have a material impact on the Company’s condensed consolidated statements of operations or condensed consolidated statements of cash flows upon adoption. The most significant impact was the recognition of ROU assets and lease liabilities for operating leases, while the Company’s accounting for finance leases remained substantially unchanged. The adoption of ASC 842 did not have a material impact in the current year and prior year comparative periods and as a result, a cumulative-effect adjustment was not required. |
Reclassifications | Reclassifications Certain prior year balances have been reclassified in order to conform to current year presentation. These reclassifications have no effect on previously reported results of operations or loss per share. |
Stock-Based Compensation | Stock-Based Compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. The fair value of the award is measured on the grant date and then is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. The Company computes the fair value of equity-classified warrants and options granted using the Black-Scholes option pricing model. Option valuation models require the input of highly subjective assumptions including the expected volatility factor of the market price of the Company’s common stock which is determined by reviewing its historical public market closing prices. |
Receivables (Tables)
Receivables (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Receivables [Abstract] | |
Summary of Receivables | The following table summarizes the receivables at June 30, 2019 and December 31, 2018: June 30, 2019 Legal Fees Settlement Total Gross receivable $ 683,250 $ 1,703,935 $ 2,387,185 Reserve for uncollectibility (455,500 ) (1,649,043 ) (2,104,543 ) Net receivable 227,750 54,892 282,642 Short-term receivable - Settlement - 54,892 54,892 Short-term receivable - Legal 227,750 - 227,750 Long-term receivable $ - $ - $ - December 31, 2018 Legal Fees Settlement Total Gross receivable $ 911,000 $ 1,783,795 $ 2,694,795 Reserve for uncollectibility (455,500 ) (1,649,043 ) (2,104,543 ) Net receivable 455,500 134,752 590,252 Short-term receivable - Settlement - 134,752 134,752 Short-term receivable - Legal $ 455,500 $ - $ 455,500 Long-term receivable - - - |
Stockholders' Deficiency (Table
Stockholders' Deficiency (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Schedule of Assumptions of Warrants | In applying the Black-Scholes option pricing model to warrants issued, the Company used the following assumptions: For the Three Month Ended For the Six Months Ended June 30, June 30, 2019 2018 2019 2018 Risk-free interest rate 2.23 % n/a 2.23 % n/a Expected terms (years) 5.00 n/a 5.00 n/a Expected volatility 129 % n/a 129 % n/a Expected dividend yields 0.00 % n/a 0.00 % n/a |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Schedule of Right-of-use Assets and Liabilities | A summary of the Company’s right-of-use assets and liabilities is as follows: Six Months Ended Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 44,330 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 265,550 Weighted Average Remaining Lease Term Operating leases 3.25 years Weighted Average Discount Rate Operating leases 8.0% |
Schedule of Future Minimum Payments Under Non-cancellable Lease | Future minimum payments under non-cancellable lease as of June 30, 2019 were as follows: For the Years Ending December 31, Amount 2019 $ 45,785 2020 90,666 2021 92,471 2022 46,687 Total future minimum lease payments 275,609 Less: amount representing imputed interest (32,556 ) Total $ 243,053 |
Liquidity and Going Concern (De
Liquidity and Going Concern (Details Narrative) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Cash and cash equivalents | $ 1,324,228 | $ 50,986 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2019 | Mar. 23, 2017 | |
PRH Note [Member] | Non-Related Party [Member] | ||
Related Party Transaction [Line Items] | ||
Debt principal amount | $ 4,825,000 | |
Borrowed outstanding convertible notes payable | 11,887,000 | |
PRH Note [Member] | Related Party [Member] | ||
Related Party Transaction [Line Items] | ||
Debt principal amount | 25,000 | |
Borrowed outstanding convertible notes payable | 6,895,000 | |
2017 Financing [Member] | ||
Related Party Transaction [Line Items] | ||
Loans received in connection with financing | $ 18,782,000 | |
2017 Financing [Member] | Minimum [Member] | ||
Related Party Transaction [Line Items] | ||
Financing arrangement amount | $ 10,000,000 | |
2017 Financing [Member] | Maximum [Member] | ||
Related Party Transaction [Line Items] | ||
Financing arrangement amount | $ 20,000,000 |
Receivables (Details Narrative)
Receivables (Details Narrative) | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Receivables [Abstract] | |
Offset against accrued payroll and other payables | $ 252,750 |
Receivables - Summary of Receiv
Receivables - Summary of Receivables (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Gross receivable | $ 2,387,185 | $ 2,694,795 |
Reserve for uncollectibility | (2,104,543) | (2,104,543) |
Net receivable | 282,642 | 590,252 |
Short-term receivable - Settlement | 54,892 | 134,752 |
Short-term receivable - Legal | 227,750 | 455,500 |
Long-term receivable | ||
Legal Fees [Member] | ||
Gross receivable | 683,250 | 911,000 |
Reserve for uncollectibility | (455,500) | (455,500) |
Net receivable | 227,750 | 455,500 |
Short-term receivable - Settlement | ||
Short-term receivable - Legal | 227,750 | 455,500 |
Long-term receivable | ||
Settlement [Member] | ||
Gross receivable | 1,703,935 | 1,783,795 |
Reserve for uncollectibility | (1,649,043) | (1,649,043) |
Net receivable | 54,892 | 134,752 |
Short-term receivable - Settlement | 54,892 | 134,752 |
Short-term receivable - Legal | ||
Long-term receivable |
Stockholders' Deficiency (Detai
Stockholders' Deficiency (Details Narrative) | 6 Months Ended |
Jun. 30, 2019USD ($)$ / sharesshares | |
Class of Stock [Line Items] | |
Fair value of warrants | $ | $ 10,113 |
Employee and Consultants [Member] | |
Class of Stock [Line Items] | |
Number of restricted stock issued | 191,590 |
Number of restricted stock issued, value | $ | $ 8,962 |
Consultant [Member] | |
Class of Stock [Line Items] | |
Warrant term | 5 years |
Consultant [Member] | Minimum [Member] | |
Class of Stock [Line Items] | |
Warrant exercise price | $ / shares | $ 1 |
Consultant [Member] | Maximum [Member] | |
Class of Stock [Line Items] | |
Warrant exercise price | $ / shares | $ 2 |
Consultant [Member] | Warrant [Member] | |
Class of Stock [Line Items] | |
Warrant to purchase common stock | 387,500 |
Consultant [Member] | Common Stock [Member] | |
Class of Stock [Line Items] | |
Warrant to purchase common stock | 387,500 |
Warrant Holders [Member] | |
Class of Stock [Line Items] | |
Warrant to purchase common stock | 100,000 |
Warrant exercise price | $ / shares | $ 0.0533 |
Aggregate cash proceeds | $ | $ 5,330 |
Number of common stock issued during period | 100,000 |
Stockholders' Deficiency - Sche
Stockholders' Deficiency - Schedule of Assumptions of Warrants (Details) - Warrant [Member] | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Risk-free interest rate | 2.23% | 0.00% | 2.23% | 0.00% |
Expected terms (years) | 5 years | 0 years | 5 years | 0 years |
Expected volatility | 1.29% | 0.00% | 1.29% | 0.00% |
Expected dividend yields | 0.00% | 0.00% | 0.00% | 0.00% |
Leases (Details Narrative)
Leases (Details Narrative) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019USD ($)ft² | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)ft² | Jun. 30, 2018USD ($) | |
Lease rent expense | $ 22,329 | $ 22,080 | $ 57,134 | $ 44,233 |
Research and Development Expense [Member] | ||||
Lease rent expense | 14,886 | 14,720 | 38,089 | 29,489 |
General and Administrative Expense [Member] | ||||
Lease rent expense | $ 7,443 | $ 7,360 | $ 19,045 | $ 14,744 |
Knoxville, Tennessee [Member] | ||||
Area of land | ft² | 4,500 | 4,500 | ||
Lease term | 5 years | 5 years | ||
Lease expiration date | Jun. 30, 2022 | |||
Knoxville, Tennessee [Member] | Minimum [Member] | ||||
Leases payments range per month | $ 7,300 | |||
Knoxville, Tennessee [Member] | Maximum [Member] | ||||
Leases payments range per month | $ 7,800 |
Leases - Schedule of Right-of-u
Leases - Schedule of Right-of-use Assets and Liabilities (Details) | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Leases [Abstract] | |
Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases | $ 44,330 |
Right-of-use assets obtained in exchange for lease obligations: Operating leases | $ 265,550 |
Weighted Average Remaining Lease Term: Operating leases | 3 years 2 months 30 days |
Weighted Average Discount Rate: Operating leases | 8.00% |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Payments Under Non-cancellable Lease (Details) | Jun. 30, 2019USD ($) |
Leases [Abstract] | |
2019 | $ 45,785 |
2020 | 90,666 |
2021 | 92,471 |
2022 | 46,687 |
Total future minimum lease payments | 275,609 |
Less: amount representing imputed interest | (32,556) |
Total | $ 243,053 |
Commitments, Contingencies an_2
Commitments, Contingencies and Litigation (Details Narrative) - USD ($) | Dec. 12, 2017 | Dec. 31, 2016 | Dec. 27, 2016 | Jan. 31, 2018 | Jun. 30, 2019 | Dec. 31, 2018 |
Payment received | $ 152,376 | |||||
Reserves on lawsuits settlement | $ 2,051,083 | $ 2,051,083 | ||||
Peter Culpepper [Member] | ||||||
Reimbursement expense | $ 294,255 | |||||
Recover from reimbursement expense | $ 294,255 | |||||
Disgorgement pay | $ 140,115 | |||||
Prejudgment interest | 12,261 | |||||
Payment received | $ 152,376 | |||||
Lawsuit settlement | $ 2,240,000 | |||||
Litigation cost | $ 227,750 | |||||
Wachter [Member] | Kleba Settlement Agreement [Member] | ||||||
Disgorgement pay | 1,199,303 | |||||
Lawsuit settlement | 1,427,053 | |||||
Litigation cost | $ 227,750 | |||||
Number of shares owned | 1,000,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | |
Aug. 08, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | |
Proceeds from exercise of warrants | $ 5,330 | $ 594,274 | |
Warrant Holders [Member] | |||
Warrants to purchase shares of common stock | 100,000 | ||
Warrant exercise price | $ 0.0533 | ||
Number of common stock issued during period | 100,000 | ||
Subsequent Event [Member] | Warrant Holders [Member] | |||
Warrants to purchase shares of common stock | 2,985,857 | ||
Warrant exercise price | $ 0.0533 | ||
Proceeds from exercise of warrants | $ 159,146 | ||
Number of common stock issued during period | 2,985,857 |