Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 10, 2022 | |
Cover [Abstract] | ||
Entity Registrant Name | EMMAUS LIFE SCIENCES, INC. | |
Entity Central Index Key | 0000822370 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2022 | |
Amendment Flag | false | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-35527 | |
Entity Tax Identification Number | 87-0419387 | |
Entity Incorporation State Country Code | DE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Address, Address Line One | 21250 Hawthorne Boulevard | |
Entity Address, Address Line Two | Suite 800 | |
Entity Address, City or Town | Torrance | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 90503 | |
City Area Code | 310 | |
Local Phone Number | 214-0065 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Common Stock, Shares Outstanding | 49,558,501 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 1,179,000 | $ 2,279,000 |
Accounts receivable, net | 1,491,000 | 1,040,000 |
Inventories, net | 2,739,000 | 4,392,000 |
Prepaid expenses and other current assets | 973,000 | 1,380,000 |
Total current assets | 6,382,000 | 9,091,000 |
Property and equipment, net | 79,000 | 147,000 |
Equity method investment | 16,594,000 | 17,616,000 |
Right of use assets | 2,944,000 | 3,485,000 |
Investment in convertible bond | 15,943,000 | 26,100,000 |
Other assets | 259,000 | 295,000 |
Total assets | 42,201,000 | 56,734,000 |
CURRENT LIABILITIES | ||
Accounts payable and accrued expenses | 11,134,000 | 9,189,000 |
Operating lease liabilities, current portion | 653,000 | 740,000 |
Conversion feature derivative, notes payable | 4,272,000 | 7,507,000 |
Other current liabilities | 2,270,000 | 4,404,000 |
Revolving line of credit from related party | 400,000 | 400,000 |
Warrant derivative liabilities | 33,000 | 1,503,000 |
Notes payable, current portion, net of discount | 5,635,000 | 2,399,000 |
Notes payable to related parties | 2,780,000 | 800,000 |
Convertible notes payable, net of discount | 14,346,000 | 10,158,000 |
Total current liabilities | 41,523,000 | 37,100,000 |
Operating lease liabilities, less current portion | 2,764,000 | 3,261,000 |
Other long-term liabilities | 32,122,000 | 33,173,000 |
Notes payable, less current portion | 1,500,000 | |
Notes payable to related parties, net | 3,381,000 | |
Convertible notes payable | 3,150,000 | |
Total liabilities | 79,790,000 | 78,184,000 |
STOCKHOLDERS’ DEFICIT | ||
Preferred stock, par value $0.001 per share, 15,000,000 shares authorized, none issued or outstanding | ||
Common stock, par value $0.001 per share, 250,000,000 shares authorized, 49,558,501 and 49,311,864 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively | 50,000 | 49,000 |
Additional paid-in capital | 220,803,000 | 220,022,000 |
Accumulated other comprehensive loss | (5,905,000) | (255,000) |
Accumulated deficit | (252,537,000) | (241,266,000) |
Total stockholders’ deficit | (37,589,000) | (21,450,000) |
Total liabilities & stockholders’ deficit | $ 42,201,000 | $ 56,734,000 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (Unaudited) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 15,000,000 | 15,000,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized | 250,000,000 | 250,000,000 |
Common stock, issued | 49,558,501 | 49,311,864 |
Common stock, outstanding | 49,558,501 | 49,311,864 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
REVENUES, NET | $ 4,939,000 | $ 5,766,000 | $ 12,460,000 | $ 17,590,000 |
COST OF GOODS SOLD | 540,000 | 445,000 | 1,943,000 | 1,311,000 |
GROSS PROFIT | 4,399,000 | 5,321,000 | 10,517,000 | 16,279,000 |
OPERATING EXPENSES | ||||
Research and development | 432,000 | 470,000 | 1,196,000 | 3,032,000 |
Selling | 1,664,000 | 1,518,000 | 5,076,000 | 4,254,000 |
General and administrative | 2,963,000 | 3,364,000 | 9,413,000 | 10,156,000 |
Total operating expenses | 5,059,000 | 5,352,000 | 15,685,000 | 17,442,000 |
LOSS FROM OPERATIONS | (660,000) | (31,000) | (5,168,000) | (1,163,000) |
OTHER INCOME (EXPENSE) | ||||
Loss on debt extinguishment | (421,000) | (421,000) | (1,172,000) | |
Change in fair value of warrant derivative liabilities | 51,000 | (131,000) | 1,341,000 | (322,000) |
Change in fair value of conversion feature derivative, notes payable | 3,850,000 | (1,357,000) | 3,235,000 | (1,132,000) |
Realized loss on investment in convertible bond | (133,000) | |||
Net loss on equity method investment | (431,000) | (663,000) | (1,490,000) | (1,999,000) |
Foreign exchange loss | (1,470,000) | (246,000) | (5,131,000) | (1,421,000) |
Interest and other income | 175,000 | 192,000 | 530,000 | 573,000 |
Interest expense | (1,520,000) | (683,000) | (3,544,000) | (2,390,000) |
Total other income (expense) | 234,000 | (2,888,000) | (5,613,000) | (7,863,000) |
LOSS BEFORE INCOME TAXES | (426,000) | (2,919,000) | (10,781,000) | (9,026,000) |
Income tax provision (benefit) | (35,000) | 232,000 | 44,000 | 58,000 |
NET LOSS | (391,000) | (3,151,000) | (10,825,000) | (9,084,000) |
COMPONENTS OF OTHER COMPREHENSIVE LOSS | ||||
Unrealized loss on debt securities available for sale (net of tax) | (3,047,000) | (2,754,000) | (7,112,000) | (2,150,000) |
Reclassification adjustment for loss included in net income | 7,000 | |||
Foreign currency translation adjustments | 481,000 | 86,000 | 1,455,000 | 243,000 |
Other comprehensive loss | (2,566,000) | (2,668,000) | (5,650,000) | (1,907,000) |
COMPREHENSIVE LOSS | $ (2,957,000) | $ (5,819,000) | $ (16,475,000) | $ (10,991,000) |
EARNINGS (NET LOSS) PER COMMON SHARE - BASIC | $ (0.01) | $ (0.06) | $ (0.22) | $ (0.18) |
EARNINGS (NET LOSS) PER COMMON SHARE - DILUTED | $ (0.01) | $ (0.06) | $ (0.22) | $ (0.18) |
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING - BASIC | 49,558,501 | 49,311,864 | 49,397,690 | 49,233,371 |
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING - DILUTED | 49,558,501 | 49,311,864 | 49,397,690 | 49,233,371 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT (Unaudited) - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Accumulated Deficit [Member] |
Balance, beginning at Dec. 31, 2020 | $ (5,158) | $ 49 | $ 218,728 | $ 1,144 | $ (225,079) |
Balance, beginning (in shares) at Dec. 31, 2020 | 48,987,189 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Fair value of warrants including down-round protection adjustments | 241 | (241) | |||
Common stock issued for services | 500 | 500 | |||
Common stock issued for services (in shares) | 324,675 | ||||
Share-based compensation | 181 | 181 | |||
Unrealized gain (loss) on debt securities available for sale (net of tax) | 58 | 58 | |||
Foreign currency translation effect | 165 | 165 | |||
Net income (loss) | (8,422) | (8,422) | |||
Balance, ending at Mar. 31, 2021 | (12,676) | $ 49 | 219,650 | 1,367 | (233,742) |
Balance, ending (in shares) at Mar. 31, 2021 | 49,311,864 | ||||
Balance, beginning at Dec. 31, 2020 | (5,158) | $ 49 | 218,728 | 1,144 | (225,079) |
Balance, beginning (in shares) at Dec. 31, 2020 | 48,987,189 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Unrealized gain (loss) on debt securities available for sale (net of tax) | (2,150) | ||||
Foreign currency translation effect | 243 | ||||
Net income (loss) | (9,084) | ||||
Balance, ending at Sep. 30, 2021 | (15,101) | $ 49 | 220,017 | (763) | (234,404) |
Balance, ending (in shares) at Sep. 30, 2021 | 49,311,864 | ||||
Balance, beginning at Mar. 31, 2021 | (12,676) | $ 49 | 219,650 | 1,367 | (233,742) |
Balance, beginning (in shares) at Mar. 31, 2021 | 49,311,864 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation | 274 | 274 | |||
Unrealized gain (loss) on debt securities available for sale (net of tax) | 546 | 546 | |||
Foreign currency translation effect | (8) | (8) | |||
Net income (loss) | 2,489 | 2,489 | |||
Balance, ending at Jun. 30, 2021 | (9,375) | $ 49 | 219,924 | 1,905 | (231,253) |
Balance, ending (in shares) at Jun. 30, 2021 | 49,311,864 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation | 93 | 93 | |||
Unrealized gain (loss) on debt securities available for sale (net of tax) | (2,754) | (2,754) | |||
Foreign currency translation effect | 86 | 86 | |||
Net income (loss) | (3,151) | (3,151) | |||
Balance, ending at Sep. 30, 2021 | (15,101) | $ 49 | 220,017 | (763) | (234,404) |
Balance, ending (in shares) at Sep. 30, 2021 | 49,311,864 | ||||
Balance, beginning at Dec. 31, 2021 | (21,450) | $ 49 | 220,022 | (255) | (241,266) |
Balance, beginning (in shares) at Dec. 31, 2021 | 49,311,864 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation | 5 | 5 | |||
Unrealized gain (loss) on debt securities available for sale (net of tax) | 350 | 350 | |||
Reclassification adjustment for loss included in net income | 7 | 7 | |||
Foreign currency translation effect | 331 | 331 | |||
Net income (loss) | (1,542) | (1,542) | |||
Balance, ending at Mar. 31, 2022 | (22,299) | $ 49 | 220,027 | 433 | (242,808) |
Balance, ending (in shares) at Mar. 31, 2022 | 49,311,864 | ||||
Balance, beginning at Dec. 31, 2021 | (21,450) | $ 49 | 220,022 | (255) | (241,266) |
Balance, beginning (in shares) at Dec. 31, 2021 | 49,311,864 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Unrealized gain (loss) on debt securities available for sale (net of tax) | (7,112) | ||||
Reclassification adjustment for loss included in net income | 7 | ||||
Foreign currency translation effect | 1,455 | ||||
Net income (loss) | (10,825) | ||||
Balance, ending at Sep. 30, 2022 | (37,589) | $ 50 | 220,803 | (5,905) | (252,537) |
Balance, ending (in shares) at Sep. 30, 2022 | 49,558,501 | ||||
Balance, beginning at Mar. 31, 2022 | (22,299) | $ 49 | 220,027 | 433 | (242,808) |
Balance, beginning (in shares) at Mar. 31, 2022 | 49,311,864 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Reclassification of warrants from liability to equity | 213 | 213 | |||
Fair value of warrants including down-round protection adjustments | 446 | (446) | |||
Common stock issued for services | 110 | $ 1 | 109 | ||
Common stock issued for services (in shares) | 246,637 | ||||
Share-based compensation | 5 | 5 | |||
Unrealized gain (loss) on debt securities available for sale (net of tax) | (4,415) | (4,415) | |||
Foreign currency translation effect | 643 | 643 | |||
Net income (loss) | (8,892) | (8,892) | |||
Balance, ending at Jun. 30, 2022 | (34,635) | $ 50 | 220,800 | (3,339) | (252,146) |
Balance, ending (in shares) at Jun. 30, 2022 | 49,558,501 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation | 3 | 3 | |||
Unrealized gain (loss) on debt securities available for sale (net of tax) | (3,047) | (3,047) | |||
Foreign currency translation effect | 481 | 481 | |||
Net income (loss) | (391) | (391) | |||
Balance, ending at Sep. 30, 2022 | $ (37,589) | $ 50 | $ 220,803 | $ (5,905) | $ (252,537) |
Balance, ending (in shares) at Sep. 30, 2022 | 49,558,501 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (10,825,000) | $ (9,084,000) |
Adjustments to reconcile net loss to net cash flows used in operating activities | ||
Depreciation and amortization | 40,000 | 44,000 |
Inventory reserve | 1,240,000 | 423,000 |
Amortization of discount of notes payable and convertible notes payable | 1,303,000 | 1,410,000 |
Foreign exchange adjustments | 5,072,000 | 1,415,000 |
Net gain on investment in marketable securities | 133,000 | |
Loss on equity method investment | 1,490,000 | 1,999,000 |
Loss on debt extinguishment | 421,000 | 1,172,000 |
Gain on disposal of property and equipment | (1,000) | |
Loss on leased assets | 22,000 | |
Share-based compensation | 13,000 | 548,000 |
Shares issued for services | 55,000 | 500,000 |
Change in fair value of warrant derivative liabilities | (1,341,000) | 322,000 |
Change in fair value of conversion feature derivative, notes payable | (3,235,000) | 1,132,000 |
Net changes in operating assets and liabilities | ||
Accounts receivable | (485,000) | (2,469,000) |
Inventories | 390,000 | 404,000 |
Prepaid expenses and other current assets | 148,000 | 202,000 |
Other non-current assets | 446,000 | 417,000 |
Income tax receivable and payable | 28,000 | 15,000 |
Accounts payable and accrued expenses | 1,479,000 | (173,000) |
Other current liabilities | (3,199,000) | 242,000 |
Other long-term liabilities | 55,000 | (637,000) |
Net cash flows used in operating activities | (6,750,000) | (2,119,000) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Sale of convertible bond | 2,919,000 | |
Purchases of property and equipment | (18,000) | (11,000) |
Loan to equity method investee | (4,226,000) | (5,241,000) |
Net cash flows used in investing activities | (1,325,000) | (5,252,000) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from notes payable issued, net of issuance cost | 4,283,000 | |
Proceeds from notes payable issued, net of issuance cost, related party | 5,469,000 | 1,000,000 |
Proceeds from convertible notes payable issued, net of issuance cost and discount | 14,490,000 | |
Payments of notes payable | (2,689,000) | (1,079,000) |
Payments of convertible notes | (7,200,000) | |
Net cash flows provided by financing activities | 7,063,000 | 7,211,000 |
Effect of exchange rate changes on cash | (88,000) | (6,000) |
Net decrease in cash, cash equivalents and restricted cash | (1,100,000) | (166,000) |
Cash, cash equivalents and restricted cash, beginning of period | 2,279,000 | 2,487,000 |
Cash, cash equivalents and restricted cash, end of period | 1,179,000 | 2,321,000 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW ACTIVITIES | ||
Interest paid | 817,000 | 840,000 |
Income taxes paid | 16,000 | 43,000 |
NON-CASH INVESING AND FINANCING ACTIVITIES | ||
Debt discount due to embedded derivative | 68,000 | $ 5,555,000 |
Debt discount due to deferred financing cost | 213,000 | |
Debt discount due to warrants | $ 70,000 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2022 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | NOTE 1 — BASIS OF PRESENTATION The accompanying unaudited condensed consolidated interim financial statements of Emmaus Life Sciences, Inc., (“Emmaus”) and its direct and indirect consolidated subsidiaries (collectively, “we,” “our,” “us” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) on the basis that the Company will continue as a going concern. All significant intercompany transactions have been eliminated. The Company’s unaudited condensed consolidated interim financial statements contain adjustments, including normal recurring accruals necessary to fairly state the Company’s consolidated financial position, results of operations and cash flows. Due to the uncertainty of the Company’s ability to meet its current liabilities and operating expenses, there is substantial doubt about the Company’s ability to continue as a going concern, as the continuation and any expansion of its business is dependent upon obtaining financing, market acceptance of Endari® , and achieving a profitable level of revenues. The consolidated interim financial statements do not include any adjustments that might result from the outcome of these uncertainties. Nature of Operations The Company is a commercial-stage biopharmaceutical company engaged in the discovery, development, marketing and sale of innovative treatments and therapies, primarily for rare and orphan diseases. The Company’s lead product, Endari ® (prescription grade L-glutamine oral powder), is approved by the U.S. Food and Drug Administration, or FDA, to reduce the acute complications of sickle cell disease (“SCD”) in adult and pediatric patients five years of age and older. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company’s significant accounting policies are described in Note 2, “Summary of Significant Accounting Policies,” in the Annual Report. There have been no material changes in these policies or their application. Going concern — The accompanying consolidated financial statements have been prepared on the basis that the Company will continue as a going concern. The Company incurred a net loss of $10.8 million for the nine months ended September 30, 2022 and had a working capital deficit of $35.1 million as of September 30, 2022. relating to the commercialization of Endari® in the Middle East North Africa region and elsewhere, will exceed its existing cash balances and cash expected to be generated from operations for the foreseeable future. In order to meet the Company’s current liabilities and future obligations, the Company will need to restructure or refinance its existing indebtedness and raise additional funds through related-party loans, equity or debt financings or licensing or other strategic agreements. The Company is in discussions with the holders of its outstanding convertible promissory notes and certain other creditors to restructure or refinance the convertible promissory notes and other current liabilities but has no understanding or agreement to do so and has no understanding or arrangement for any additional financing. There can be no assurance that the Company will be able to restructure or refinance its existing indebtedness or other current liabilities or complete any additional equity or debt financings on favorable terms, or at all, or enter into licensing or other strategic arrangements. Due to the uncertainty of the Company’s ability to meet its current liabilities and operating expenses, there is substantial doubt about the Company’s ability to continue as a going concern for 12 months from the date of this filing. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. Management has considered all recent accounting pronouncements and determined that they will not have a material effect on the Company’s condensed consolidated financial statements. Factoring accounts receivables — Emmaus Medical, Inc., or Emmaus Medical, an indirect wholly owned subsidiary of Emmaus, is party to a purchase and sales agreement with Prestige Capital Finance, LLC or Prestige Capital, pursuant to which Emmaus Medical may offer and sell to Prestige Capital from time to time eligible accounts receivable in exchange for Prestige Capital’s down payment, or advance, to Emmaus Medical of 75% of the face amount of the accounts receivable, subject to a $7.5 million cap on advances at any time. The balance of the face amount of the accounts receivable will be reserved by Prestige Capital and paid to Emmaus Medical, less fees of Prestige Capital ranging from 2.25 % to 7.25 % of the face amount, as and when Prestige Capital collects the entire face amount of the accounts receivable. Emmaus Medical’s obligations to Prestige Capital under the purchase and sale agreement are secured by a security interest in the accounts receivable and all or substantially all other assets of Emmaus Medical. In connection with the purchase and sale agreement, Emmaus has guaranteed Emmaus Medical’s obligations under the purchase and sale agreement. Accounts receivable included $ and $ of factoring accounts receivable and there were $ and $ 9,000 liabilities related to factoring reflected in other current liabilities at September 30, 2022 and September 30, 2021, respectively . For three and nine months ended September 30, 2022, the Company incurred approximately $ , and $ , respectively, of factoring fees. For three and nine months ended September 30, 2021, the Company incurred approximately $ 106,000 and $ 181,000 , respectively of factori ng fees. Net loss per share — In accordance with Accounting Standard Codification (“ASC”) 260, “Earnings per Share, ” the basic loss per common share is computed by dividing net loss available to common stockholders by the weighted-average number of common shares outstanding. Diluted net loss per share is computed in a manner similar to basic net loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. As of September 30, 2022 and September 30, 2021, the Company had outstanding potentially dilutive securities exercisable for or convertible into 52,635,590 shares and 23,276,594 shares, respectively, of the Company’s common stock. No potentially dilutive securities were included in the calculation of diluted net loss per share since the potential dilutive securities were anti-dilutive for periods ended September 30, 2022 and September 30, 2021. |
REVENUES
REVENUES | 9 Months Ended |
Sep. 30, 2022 | |
Revenue From Contract With Customer [Abstract] | |
REVENUES | NOTE 3 — REVENUES Revenues disaggregated by category were as follows (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Endari® $ 4,763 $ 5,590 $ 12,072 $ 17,186 Other 177 176 $ 389 404 Revenues, net $ 4,939 $ 5,766 $ 12,460 $ 17,590 The following table summarizes the revenue allowance and accrual activities for the nine months ended September 30, 2022 and September 30, 2021 (in thousands): Trade Discounts, Allowances and Chargebacks Government Rebates and Other Incentives Returns Total Balance as of December 31, 2021 $ 1,481 $ 3,133 $ 539 $ 5,153 Provision related to sales in the current year 1,859 1,828 210 3,897 Adjustments related to prior period sales (56 ) 18 569 531 Credits and payments made (2,379 ) (1,656 ) (977 ) (5,012 ) Balance as of September 30, 2022 $ 905 $ 3,323 $ 341 $ 4,569 Balance as of December 31, 2020 $ 134 $ 2,119 $ 473 $ 2,726 Provision related to sales in the current year 2,374 2,627 188 5,189 Adjustments related to prior period sales 13 8 (111 ) (90 ) Credits and payments made (1,217 ) (2,201 ) (20 ) (3,438 ) Balance as of September 30, 2021 $ 1,304 $ 2,553 $ 530 $ 4,387 The following table summarizes revenues attributable to each of our customers that accounted for 10% or more of our net revenues in any of the periods shown: Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Customer A 9 % 31 % 23 % 47 % Customer B 35 % 49 % 27 % 35 % Customer C 13 % 12 % 12 % 10 % Customer D 15 % 0 % 11 % 0 % Customer E 14 % 0 % 7 % 0 % The Company is party to a distributor agreement with Telcon Pharmaceutical RF, Inc., or Telcon pursuant to which the Company granted Telcon exclusive rights to the Company’s prescription grade L-glutamine (“PGLG”) oral powder for the treatment of diverticulosis in South Korea, Japan and China in exchange for Telcon’s payment of a $10 million upfront fee and agreement to purchase from the Company specified minimum quantities of the PGLG. In a related license agreement with Telcon, the Company agreed to use commercially reasonable best efforts to obtain product registration in these territories within three years of obtaining FDA marketing authorization for PGLG in this indication. Telcon has the right to terminate the distributor agreement in certain circumstances specified in the distributor agreement for failure to obtain such product registrations, in which event the Company would be obliged to return to Telcon the $10 million upfront fee. The fee is included in other long-term liabilities as unearned revenue as of September 30, 2022 and December 31, 2021. Refer to Note 6 and 11 and for additional transaction details. |
SELECTED FINANCIAL STATEMENT -
SELECTED FINANCIAL STATEMENT - ASSETS | 9 Months Ended |
Sep. 30, 2022 | |
Balance Sheet Related Disclosures [Abstract] | |
SELECTED FINANCIAL STATEMENT - ASSETS | NOTE 4 — SELECTED FINANCIAL STATEMENT — ASSETS Inventories consisted of the following (in thousands): September 30, 2022 December 31, 2021 Raw materials and components $ 1,493 $ 1,439 Work-in-process 278 115 Finished goods 5,598 6,228 Inventory reserve (4,630 ) (3,390 ) Total inventories, net $ 2,739 $ 4,392 Prepaid expenses and other current assets consisted of the following (in thousands): September 30, 2022 December 31, 2021 Prepaid insurance $ 134 $ 660 Prepaid expenses 328 326 Other current assets 511 394 Total prepaid expenses and other current assets $ 973 $ 1,380 Property and equipment consisted of the following (in thousands): September 30, 2022 December 31, 2021 Equipment $ 360 $ 342 Leasehold improvements 39 39 Furniture and fixtures 99 103 Construction-in-progress — 57 Total property and equipment 498 541 Less: accumulated depreciation (420 ) (394 ) Total property and equipment, net $ 79 $ 147 During the three months ended September 30, 2022 and 2021, depreciation expense was approximately $9,000 and $11,000, respectively. During the nine months ended September 30, 2022 and 2021, depreciation expense was approximately $30,000 and $34,000, respectively. |
INVESTMENTS
INVESTMENTS | 9 Months Ended |
Sep. 30, 2022 | |
Investments [Abstract] | |
INVESTMENTS | NOTE 5 — INVESTMENTS Investment in convertible bond - On September 28, 2020, the Company entered into a convertible bond purchase agreement pursuant to which it purchased at face value a convertible bond of Telcon in the principal amount of approximately $26.1 million which matures on October 16, 2030 and bears interest at the rate of 2.1% per year, payable quarterly. Beginning October 16, 2021, the Company became entitled on a quarterly basis to call for early redemption of all or any portion of the principal amount of the convertible bond. The convertible bond is convertible at the holder’s option at any time and from time to time into common shares of Telcon at an initial conversion price of KRW9,232, or approximately $8.00 per share. The initial conversion price is subject to downward adjustment monthly based on the volume-weighted average market price of Telcon shares as reported on Korean Securities Dealers Automated Quotations Market and in the event of the issuance of Telcon shares or share equivalents at a price below the market price of Telcon shares or upon a merger or similar reorganization of Telcon or a stock split, reverse stock split, stock dividend or similar event. The conversion price as of September 30, 2022 is set forth in the “Investment in convertible bond” table below. The convertible bond and any proceeds therefrom, including proceeds from any exercise of the early redemption right described above or the call option described below, are pledged as collateral to secure the Company’s obligations under the API Supply Agreement and revised API Agreement with Telcon described in Note 6 and Note 11. Concurrent with the purchase of the convertible bond, the Company entered into an agreement dated September 28, 2020 pursuant to which Telcon or its designee is entitled to repurchase, at par, up to 50% in principal amount of the convertible bond at any time and from time to time The Company has elected the fair value option method of accounting for the investment in convertible bond. The investment in convertible bond is classified as an available for sale security and remeasured at fair value on a recurring basis using Level 3 inputs, with any changes in the fair value option recorded in other comprehensive income (loss). The fair value and any changes in fair value in the convertible bond is determined using a binominal lattice model. The model produces an estimated fair value based on changes in the price of the underlying common stock over successive periods of time. In February 2022, the Company and Telcon agreed to settle a “target shortfall” under the revised API agreement with Telcon for the years ended 2020 and 2021 by exchanging KRW3.5 billion, or approximately US$2.9 million, principal amount and accrued and unpaid interest of the Telcon convertible bond and KRW400 million, or approximately US$310,000, in cash proceeds of the convertible bond. As a result, the Company realized a net loss on investment convertible bond of $126,000, which previously was classified as unrealized loss on debt securities available-for-sale in the other comprehensive income, and other income of $41,000. See Notes 6 and 11 for additional information on the “target shortfall.” The following table sets forth the fair value and changes in fair value of the investment in the Telcon convertible bond as of September 30, 2022 and December 31, 2021 (in thousands): Investment in convertible bond September 30, 2022 December 31, 2021 Balance, beginning of period $ 26,100 $ 27,866 Sales of convertible bond (2,919 ) — Net loss on investment on convertible bond (126 ) — Change in fair value included in the statement of other comprehensive income (7,112 ) (1,766 ) Balance, end of period $ 15,943 $ 26,100 The fair value as of September 30, 2022 and December 31, 2021 was based upon following assumptions: September 30, 2022 December 31, 2021 Principal outstanding (South Korean won) KRW 26.5 billion KRW 30 billion Stock price KRW1,075 KRW2,925 Expected life (in years) 8.04 8.79 Selected yield 16.75 % 10.50 % Expected volatility (Telcon common stock) 78.80 % 81.31 % Risk-free interest rate (South Korea government bond) 4.14 % 2.19 % Expected dividend yield — — Conversion price KRW1,150 (US$0.80) KRW2,847 (US$2.39) Equity method investment – During 2018, the Company and Japan Industrial Partners, Inc., or JIP, formed EJ Holdings, Inc., or EJ Holdings, to acquire, own and operate a shuttered amino acids manufacturing facility in Ube, Japan. In connection with the formation, the Company invested approximately $32,000 in exchange for 40% of EJ Holdings voting shares. JIP owns 60% of EJ Holdings voting shares. In October 2018, the Company entered into a loan agreement with EJ Holdings under which the Company made an unsecured loan to EJ Holdings in the amount of $ million . The loan proceeds were used by EJ Holdings to purchase the Ube facility in December 2019 and pay related taxes. The loan matures on September 30, 2028 and bears interest at the annual rate of 1 % , payable annually. The parties also contemplated that t he Ube facility w ould eventually supply the Company with the facility’s output of amino acids and that the operation of the facility w ould be principally for the Company’s benefit and, as such, that major decisions affecting EJ Holdings and the Ube facility w ould be made by EJ Holdings’ board of directors, a majority of which are representatives of JIP, in consultation with the Company. During the nine months ended September 30, 202 2 , the Company made an additional $ 4.2 million of loans to EJ Holdings. As of September 3 0 , 202 2 , and December 31, 20 2 1 , the loan s receivable from EJ Holdings w ere approximately $ 21.7 million and $ million, respectively , as reflected in equity method investment on the consolidated balance sheets . EJ Holdings is engaged in retrofitting the Ube facility in order to seek regulatory approvals for the manufacture of PGLG in accordance with cGMP. EJ Holdings has had no substantial revenues since its inception, has depended on loans from the Company to acquire the Ube facility and fund its operations and will continue to be dependent on loans from the Company or other financing unless and until the Ube facility is activated and EJ Holdings can secure customers for its products. There is no assurance the Company will be able to continue to provide loan financing to support EJ Holdings’ activities at the Ube facility or that EJ Holdings will be able to obtain other financing. If EJ Holdings is unable to obtain financing, it may need to seek to sell all or part of the Ube facility. In such event, the Company could lose all or part of its investment. The Company has determined that EJ Holdings is a variable interest entity, or VIE, based upon its dependence upon loan financing provided by the Company to acquire the Ube facility and fund EJ Holdings’ activities, which are principally for the Company’s benefit. JIP, however, owns 60% of EJ Holdings and is entitled to designate a majority of the directors of EJ Holdings and its Chief Executive Officer and outside auditors, and, as such, controls the management, business, and operations of EJ Holdings. Accordingly, the Company accounts for its variable interest in EJ Holdings under the equity method. The Company’s share of the loss reported by EJ Holdings are classified as net loss on equity method investment. The investment is evaluated for impairment and if facts and circumstances indicate that the carrying value may not be recoverable, an impairment charge would be recorded. The following table sets forth certain financial information of EJ Holdings for the three and nine months ended September 30, 2022 and 2021 (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 (Unaudited) (Unaudited) (Unaudited) (Unaudited) REVENUES, NET $ 46 $ 57 $ 148 $ 174 NET LOSS $ (1,077 ) $ (1,657 ) $ (3,725 ) $ (4,998 ) |
SELECTED FINANCIAL STATEMENT CA
SELECTED FINANCIAL STATEMENT CAPTIONS - LIABILITIES | 9 Months Ended |
Sep. 30, 2022 | |
Payables And Accruals [Abstract] | |
SELECTED FINANCIAL STATEMENT CAPTIONS - LIABILITIES | NOTE 6 — SELECTED FINANCIAL STATEMENT - LIABILITIES Accounts payable and accrued expenses consisted of the following at September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 December 31, 2021 Accounts payable: Clinical and regulatory expenses $ 444 $ 534 Professional fees 579 477 Selling expenses 1,138 932 Manufacturing costs 532 378 Non-employee board member compensation 401 136 Other vendors 313 262 Total accounts payable 3,407 2,719 Accrued interest payable, related parties 325 91 Accrued interest payable 1,673 579 Accrued expenses: Payroll expenses 1,196 1,097 Government rebates and other rebates 4,157 4,371 Other accrued expenses 376 332 Total accrued expenses 5,729 5,800 Total accounts payable and accrued expenses $ 11,134 9,189 Other current liabilities consisted of the following at September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 December 31, 2021 Trade discount $ 1,200 $ 3,000 Other current liabilities 1,070 1,404 Total other current liabilities $ 2,270 $ 4,404 Other long-term liabilities consisted of the following at September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 December 31, 2021 Trade discount $ 22,095 $ 23,148 Unearned revenue 10,000 10,000 Other long-term liabilities 27 25 Total other long-term liabilities $ 32,122 $ 33,173 On June 12, 2017, the Company entered into an API Supply Agreement with Telcon pursuant to which Telcon advanced to the Company approximately $31.8 million as an advance trade discount in consideration of the Company’s agreement to purchase from Telcon the Company’s estimated annual target requirements for bulk containers of PGLG. On July 12, 2017, the Company entered into a raw material supply agreement with Telcon which revised certain items of the API Supply Agreement (the “revised API Agreement”). The Company purchased $523,000 of PGLG from Telcon in the nine months ended September 30, 2022 and purchased $250,000 of PGLG in the nine months ended September 30, 2021 of which $537,000 and $382,000 were reflected in accounts payable as of September 30, 2022 and December 31, 2021, respectively. The revised API Agreement provided for an annual API purchase target of $5 million and a target “profit” ( i.e. , gross margin) to Telcon of $2.5 million. To the extent these targets are not met, which management refers to as a “target shortfall,” Telcon may be entitled to payment of the target shortfall or to settle the target shortfall by exchange of principal and interest on the Telcon convertible bond and proceeds thereof that are pledged as a collateral to secure the Company’s obligations under the API Supply Agreement and the revised API Agreement. See Note 5 for information regarding the settlement in the nine months ended September 30, 2022 of the target shortfall for 2021 and 2020 |
NOTES PAYABLE
NOTES PAYABLE | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | NOTE 7 — NOTES PAYABLE Notes payable consisted of the following at September 30, 2022 and December 31, 2021 (in thousands except for number of underlying shares) excluding the revolving line of credit agreement with related party discussed below: Year Issued Interest Rate Range Term of Notes Conversion Price Principal Outstanding September 30, 2022 Unamortized Discount September 30, 2022 Carrying Amount September 30, 2022 Underlying Shares September 30, 2022 Notes payable 2013 10% Due on demand — $ 692 $ — $ 692 — 2021 11% Due on demand - 2 years — 2,719 — 2,719 — 2022 11%-36% Due on demand - 7 month — 2,243 19 2,224 — $ 5,654 $ 19 $ 5,635 — Current $ 5,654 $ 19 $ 5,635 — Notes payable - related parties 2020 12% Due on demand — 100 — 100 — 2021 12% Due on demand — 700 — 700 — 2022 6%-12% Due on demand - 5 years — 5,501 135 5,361 (c) — $ 6,301 $ 135 $ 6,161 — Current $ 2,780 $ — $ 2,780 — Non-current $ 3,521 $ 135 $ 3,381 — Convertible notes payable 2020(a) 12% 3 years $ 10.00 3,150 — 3,150 320,067 2021(b) 2% 3 years $ 0.37 14,315 3,119 11,196 41,112,131 $ 17,465 $ 3,119 $ 14,346 41,432,198 Current $ 17,465 $ 3,119 $ 14,346 41,432,198 Total $ 29,421 $ 3,273 $ 26,143 41,432,198 Year Issued Interest Rate Range Term of Notes Conversion Price Principal Outstanding December 31, 2021 Unamortized Discount December 31, 2021 Carrying Amount December 31, 2021 Underlying Shares December 31, 2021 Notes payable 2013 10% Due on demand — $ 869 $ — $ 869 — 2021 11% Due on demand - 2 years — 3,030 — 3,030 — $ 3,899 $ — $ 3,899 — Current $ 2,399 $ — $ 2,399 — Non-current $ 1,500 $ — $ 1,500 — Notes payable - related parties 2020 12% Due on demand — $ 100 $ — $ 100 — 2021 12% Due on demand — 700 — 700 — $ 800 $ — $ 800 — Current $ 800 $ — $ 800 — Convertible notes payable 2020(a) 12% 3 years $ 10.00 3,150 — 3,150 316,756 2021(b) 2% 3 years $ 1.48 14,490 4,332 10,158 9,856,343 $ 17,640 $ 4,332 $ 13,308 10,173,099 Current $ 14,490 $ 4,332 $ 10,158 9,856,343 Non-current $ 3,150 $ — $ 3,150 316,756 Total $ 22,339 $ 4,332 $ 18,007 $ 10,173,099 (a) This note is convertible into shares of EMI Holding, Inc., a wholly owned subsidiary of Emmaus Life Sciences, Inc . (b) The notes are convertible into shares of common stock of Emmaus Life Sciences, Inc. Beginning February 28, 2022, the note holders became entitled to call for redemption of the convertible notes payable at any time. Accordingly, the notes are classified as current liabilities. (c) Includes $41,000 of the fair value of embedded derivative. The weighted-average stated annual interest rate of notes payable was 7% and 6% as of September 30, 2022 and December 31, 2021, respectively. The weighted-average effective annual interest rate of notes payable as of September 30, 2022 and December 31, 2021 was 19% and 15%, respectively, after giving effect to discounts relating to conversion features, warrants and deferred financing costs relating to the notes. As of September 30, 2022, future contractual principal payments due on notes payable were as follows (in thousands): Year Ending 2022 (three months) $ 25,900 (a) 2025 1,200 2027 2,321 Total $ 29,421 (a) Includes $14.3 million principal amount of convertible notes subject to redemption at any time at the election of the holders. The Company is party to a revolving line of credit agreement with Yutaka Niihara, M.D., M.P.H., the Company’s Chairman and Chief Executive Officer. Under the agreement, at the Company’s request from time to time Dr. Niihara may, but is not obligated to, loan or re-loan to the Company up to $1,000,000. Outstanding amounts under the agreement are due and payable upon demand and bear interest, payable monthly, at a variable annual rate equal to the Prime Rate in effect from time to time plus 3%. In addition to the payment of interest, the Company is obligated to pay Dr. Niihara a “tax gross-up” intended to make him whole for federal and state income and employment taxes payable by him with respect to interest and tax gross-up paid to him in the previous year. As of September 30, 2022 and December 31, 2021, the outstanding principal balance under the agreement of $400,000 was reflected in revolving line of credit from related party on the condensed consolidated balance sheets. With the tax-gross up, the effective interest rate on the outstanding balance as of September 30, 2022, was 10.4%. The revolving line of credit agreement will expire on November 22, 2022. Refer to Note 12 for more information on related party transactions. On February 9, 2021, the Company entered into a securities purchase agreement pursuant to which the Company agreed to sell and issue to the purchasers thereunder in a private placement pursuant to Rule 4(a)(2) of the Securities Act of 1933, as amended, and Regulation D thereunder a total of up to $17 million in principal amount of convertible promissory notes of the Company for a purchase price equal to the principal amount thereof. The Company sold and issued approximately $14.5 million of the convertible promissory notes. Commencing one year from the original issue date, the convertible promissory notes became convertible at the option of the holder into shares of the Company’s common stock at an initial conversion price of $1.48 per share, which equaled the “Average VWAP” (as defined) of the Company’s common stock on the effective date. The initial conversion price is subject to adjustment as of the end of each three-month period commencing May 31, 2021, to equal the Average VWAP as of the end of such three-month period if such Average VWAP is less than the then-conversion price. There is no floor on the conversion price. The conversion price will be subject to further adjustment in the event of a stock split, reverse stock split or certain other events specified in the convertible promissory notes. As of September 30, 2022, the conversion price was $0.37 per share. The convertible promissory notes bear interest at the stated rate of 2% per year (10% in the event of a default), payable semi-annually on the last business day of August and January of each year and will mature on the 3rd anniversary of the original issue date, unless earlier converted or prepaid. The convertible promissory notes are redeemable in whole or in part at the election of the holders. The Company is entitled to prepay up to 50% of the principal amount of the convertible promissory notes at any time on or before February 28, 2023 for a prepayment amount equal to the principal amount being prepaid, accrued and unpaid interest thereon and a prepayment premium equal to 50% of such principal amount. The convertible promissory notes are general, unsecured obligations of the Company. The conversion feature of the convertible promissory notes is separately accounted for at fair value as a derivative liability under guidance in ASC 815 that is remeasured at fair value on a recurring basis using Level 3 inputs, with any changes in the fair value of the conversion feature liability recorded in the condensed consolidated statements of operations. The following table sets forth the fair value of the conversion feature liability as of September 30, 2022 and December 31, 2021 (in thousands): Convertible promissory notes September 30, 2022 December 31, 2021 Balance, beginning of period $ 7,507 $ — Fair value at issuance date — 5,594 Change in fair value included in the statement of operations (3,235 ) 1,913 Balance, end of period $ 4,272 $ 7,507 The fair value and any change in fair value of conversion feature liability are determined using a binominal lattice model. The model produces an estimated fair value based on changes in the price of the underlying common stock. The fair value as of September 30, 2022 and December 31, 2021was based upon following assumptions: Convertible promissory notes September 30, 2022 December 31, 2021 Stock price $ 0.17 $ 1.67 Conversion price $ 0.37 $ 1.48 Selected yield 30.93 % 21.99 % Expected volatility 50 % 50 % Time until maturity (in years) 1.41 2.16 Dividend yield — — Risk-free rate 4.12 % 0.77 % In June 2022, the Company entered into a Business Loan and Security Agreement and Addenda with a third-party lender pursuant to which the lender loaned the Company $1,800,000, which we refer to as the “loan amount,” of which we received net proceeds of approximately $1,666,000 after deduction of the lender’s origination fee but without deduction for other transaction expenses. The loan amount, together with interest of $738,000, was payable over the 40-week loan term in weekly installments of $31,725 for the first eight weeks and $71,381 for the remaining 32 weeks. The loan amount and interest were prepayable by the Company at any time within 90 days from the disbursement date for a repayment amount of $2,250,000, less all prior payments on the loan, unless an event of default has occurred under the Business Loan and Security Agreement. Repayment of the loan was secured by a security interest in all or substantially all our assets and all assets of our U.S. subsidiaries and was personally guaranteed by Yutaka Niihara, M.D., M.P.H., our Chairman and Chief Executive Officer and principal stockholder, and his wife and Hope Hospice International, Inc., which is wholly owned by Dr. Niihara and his wife. The personal guarantee was secured by a deed of trust on certain real property of Dr. Niihara and his wife. In August 2022, the Company repaid in full $1.6 million principal of the outstanding balance of the loan and recognized debt extinguishment loss of $421,000. In July 2022, Dr. Niihara and his wife loaned the Company $370,000, representing the net proceeds of personal loans to them from unaffiliated parties in the principal amount of $402,000. The loan is due and payable in a lump sum on maturity on July 31, 2027 and bears interest at the rate of 12% per annum, payable monthly in arrears. In connection with the loan, the Company granted Dr. Niihara a warrant as described in Note 8. The issuance cost of $32,000 and the fair value of warrant of $84,000 were treated as debt discount and will be amortized over the five-year term of the warrant using effective interest method. . In August 2022, Dr. Niihara and his wife loaned the Company $1,576,574, representing the net proceeds of personal loans to them from unaffiliated third parties in the principal amount of $1,668,751, as well as $250,000 from personal funds. The loans are evidenced by promissory notes, which are due and payable in a lump sum on maturity on August 16, 2027 and bear interest at the rate of 10% per annum, payable monthly in arrears. The foregoing loans were in addition to a $50,000 loan to us from Hope International Hospice, Inc., an affiliate of Dr. and Mrs. Niihara, on August 15, 2022, which is evidenced by a demand promissory note of the Company bearing interest at the rate of 10% per annum. The proceeds of the loans were used to prepay $1,924,819 indebtedness of the Company under the Business Loan and Security Agreement referred to above. In September 2022, Seah Lim, M.D., Ph.D. loaned the Company $1.2 million, the proceeds of which were used to augment the Company’s working capital. The principal amount of the loan and interest thereon at the rate of 6% per annum, together with 240,000 shares of the Company’s common stock, is due and payable in lump sum on maturity in September 2025 In July 2022, Emmaus Medical, Inc., or Emmaus Medical, an indirect wholly owned subsidiary of the Company, entered into a Standard Merchant Cash Advance Agreement with a third party pursuant to which it sold $816,000 of accounts receivable (the “Receivables Purchased Amount”) in exchange for net proceeds of $516,000. Under the agreement, the third party is entitled to collect a specified percentage of all accounts receivable of Emmaus Medical, not to exceed $34,000 weekly, until the third party receives total proceeds equal to the Receivables Purchased Amount. In September 2022, Emmaus Medical and the third party entered into a similar agreement pursuant to which Emmaus Medical sold $694,960 of accounts receivable (the “Receivables Purchased Amount”) for net proceeds of $500,000. Under the agreement, the third party is entitled to collect a specified percentage of all accounts receivable of Emmaus Medical, not to exceed $25,969 weekly, until the third party receives total proceeds equal to the Receivables Purchased Amount. Emmaus Medical’s obligations under the two agreements are guaranteed by the Emmaus Life Sciences, Inc. Company and its U.S. subsidiaries, and the obligations of Emmaus Medical and the guarantors are secured by a security interest in all or substantially all the assets of Emmaus Life Sciences and its U.S. subsidiaries. |
STOCKHOLDERS' DEFICIT
STOCKHOLDERS' DEFICIT | 9 Months Ended |
Sep. 30, 2022 | |
Stockholders Equity Note [Abstract] | |
STOCKHOLDERS' DEFICIT | NOTE 8 — STOCKHOLDERS’ DEFICIT Extension of Convertible Promissory Note - On June 15, 2020, the holder of a convertible promissory note in the principal amount of $3,150,000 agreed to an extension of the maturity date of the convertible promissory note to June 15, 2023 in exchange for an increase in the interest rate on the note from 11% to 12%. In conjunction with the extension, the Company issued to the note holder a five-year The following table presents the fair value and the change in fair value of the warrants as of June 15, 2022 and December 31, 2020 (in thousands): Warrant liability—Convertible Promissory Note June 15, 2022 December 31, 2021 Balance, beginning of period $ 1,463 $ 988 Change in fair value included in the statement of operations (1,250 ) 475 Reclassification to equity (213 ) — Balance, end of period $ — $ 1,463 The fair value of the warrant derivative liability was determined using the Black-Scholes Merton model based upon following assumptions: June 15, 2022 December 31, 2021 Exercise price $ 2.05 $ 2.05 Stock price $ 0.36 $ 1.67 Risk‑free interest rate 3.35 % 1.04 % Expected volatility (peer group) 126.00 % 117.00 % Expected life (in years) 3.00 3.46 Expected dividend yield — — Number outstanding 1,250,000 1,250,000 A summary of outstanding warrants as of September 30, 2022 and December 31, 2021 is presented below: September 30, 2022 December 31, 2021 Number of Warrants Weighted‑ Average Exercise Price Number of Warrants Weighted‑ Average Exercise Price Warrants outstanding, beginning of period 8,236,017 $ 5.78 8,439,480 $ 6.09 Granted 500,000 $ 2.50 — Exercised — — Cancelled, forfeited or expired (2,125,497 ) $ 14.38 (203,463 ) $ 4.36 Warrants outstanding, end of period 6,610,520 $ 2.88 8,236,017 $ 5.78 Warrants exercisable end of period 6,610,520 $ 2.88 7,486,017 $ 6.12 Warrants — In September 2022, in connection with the loans from Dr. Niihara and Mrs. Niihara, the Company granted Dr. Niihara a five-year As of September 30, 2022, the weighted-average remaining contractual life of outstanding warrants was 2.3 years. Stock options —The Company’s former Amended and Restated 2011 Stock Incentive Plan expired on May 3, 2021, and no further awards may be made under the 2011 Plan. The expiration of the 2011 Plan did not affect outstanding stock awards thereunder. The Company also previously maintained an Amended and Restated 2012 Omnibus Incentive Compensation Plan, which was terminated in September 2021 in connection with the adoption of the 2021 Stock Incentive Plan described below. On September 29, 2021, the Board of Directors of the Company adopted the Emmaus Life Sciences, Inc. 2021 Stock Incentive Plan upon the recommendation of the Compensation Committee of the Board. The 2021 Stock Incentive Plan was approved by stockholders on November 23, 2021. No more than 4,000,000 shares of common stock may be issued pursuant to awards under the 2021 Stock Incentive Plan. The number of shares available for Awards and the terms of outstanding awards are subject to adjustment for stock splits, stock dividends, reverse stock splits, recapitalizations and other similar events. As of September 30, 2022 and December 31, 2021, no awards were outstanding under the 2021 Stock Incentive Plan. A summary of outstanding stock options as of September 30, 2022 and December 31, 2021 is presented below. September 30, 2022 December 31, 2021 Number of Options Weighted‑ Average Exercise Price Number of Options Weighted‑ Average Exercise Price Options outstanding, beginning of period 5,968,338 $ 4.78 7,110,025 $ 4.63 Granted or deemed granted — $ — — $ — Exercised — $ — — $ — Cancelled, forfeited and expired (1,055,399 ) $ 3.45 (1,141,687 ) $ 3.82 Options outstanding, end of period 4,912,939 $ 5.07 5,968,338 $ 4.78 Options exercisable, end of period 4,894,938 $ 5.09 5,937,837 $ 4.80 Options available for future grant 4,000,000 4,000,000 During the three months ended September 30, 2022 and September 30, 2021, the Company recognized $3,000 and $93,000, respectively of share-based compensation expense. During the nine months ended September 30, 2022 and September 30, 2021 the Company recognized $13,000 and $548,000, respectively, of share-based compensation expense. As of September 30, 2022, there was approximately $8,000 of unrecognized share-based compensation expense related to unvested stock options which is expected to be recognized over the weighted-average remaining vesting period of 0.7 year. Collaborative Research and Development Agreement with Kainos Medicine, Inc — On February 26, 2021, the Company entered into a collaborative research and development agreement with Kainos Medicine, Inc. (“Kainos”) to lead the preclinical development of Kainos’ patented IRAK4 inhibitor (“KM10544”) as an anti-cancer drug and further advance Kainos’s research and development activities. The companies also entered into a letter of intent regarding possible future joint development of small molecule therapeutics and other pharmaceutical assets. Pursuant to the collaborative research and development On October 7, 2021, the Company entered into a license agreement with Kainos under which Kainos granted the Company an exclusive license in the territory encompassing the U.S., the U.K. and the EU to patent rights, know-how and other intellectual property relating to Kainos’s novel IRAK4 inhibitor, referred to as KM10544, for the treatment of cancers, including leukemia, lymphoma and solid tumor cancers. In consideration of the license, the Company paid Kainos a six-figure upfront fee in cash and agreed to make additional cash payments upon the achievement of specified milestones totaling in the mid-eight figures and pay a single-digit percentage royalty based on net sales of the licensed products and a similar percentage of any sublicensing consideration. During the nine months ended September 30, 2021, the Company incurred $1.0 million of research and development expenses related to the Kainos collaboration and license agreement. The Company incurred no such expenses in the nine months ended September 30, 2022. Amended and Restated Warrants – The Company evaluated its outstanding amended and restated warrants to purchase up to 4,038,200 shares of common stock under ASC 815-40 and concluded that the warrants should be accounted for as equity. In June 2022, the exercise price of outstanding amended and restated warrants was reduced to $0.446 per share pursuant to the anti-dilution adjustment provisions of the warrants triggered by the Company’s issuance of restricted shares of common stock for professional relations and consulting services discussed below. The warrants were valued using the Black-Scholes Merton model and the $446,000 change in fair value was recorded as additional paid-in capital and accumulated deficit. Stock issued for services – In June 2022, the Company issued 246,637 shares of restricted share of common stock, with an estimated fair value of $110,000 for professional relations and consulting services to be rendered over the six-month period beginning July 1, 2022. The value of the shares issued in connection with this agreement was recorded in prepaid expenses and other current assets in the condensed consolidated balance sheet as of September 30, 2022 and is being amortized over the six-month period beginning July 1, 2022. |
INCOME TAX
INCOME TAX | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAX | NOTE 9 — INCOME TAX The quarterly provision for or benefit from income taxes is computed based upon the estimated annual effective tax rate and the year-to-date pre-tax income (loss) and other comprehensive income. For the three and nine months ended September 30, 2022, the Company recorded an income tax benefit of $35,000 and provision of $44,000, respectively. For three and nine month ended September 30, 2021, the Company recorded an income tax provision of $232,000 and $58,000, respectively. The Company did not record a provision for federal income tax due to its net operating loss carryforwards. The Company established a full valuation allowance against its federal and state deferred tax asset and there was no unrecognized tax benefit as of September 30, 2022 or September 30, 2021. |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
LEASES | NOTE 10 — LEASES Operating leases — The Company leases its office space under operating leases with unrelated entities. The Company leases 21,293 square feet of office space for our headquarters in Torrance, California, at a base rental of $80,886 per month, which lease will expire on September 30, 2026. The rent expense during the three months ended September 30, 2022 and 2021 was approximately $272000 and $300,000, respectively, and during the nine months ended September 30, 2022 and September 30, 2021 was approximately $868,000 and $889,000, respectively. Future minimum lease payments under the lease agreements were as follows as of September 30, 2022 (in thousands): Amount 2022 (three months) $ 263 2023 1,049 2024 1,063 2025 1,092 2026 836 Total lease payments 4,303 Less: Interest 887 Present value of lease liabilities $ 3,416 As of September 30, 2022, the Company had an operating lease right-of-use asset of $2.9 million and lease liability of $3.4 million reflected on the condensed consolidated balance sheet. The weighted average remaining term of the Company’s leases as of September 30, 2022 was 4.0 years and the weighted-average discount rate was 12.9%. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2022 | |
Commitments And Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 11 — COMMITMENTS AND CONTINGENCIES API Supply Agreement — On June 12, 2017, the Company entered into an API Supply Agreement (the “API Supply Agreement”) with Telcon pursuant to which Telcon paid the Company approximately $31.8 million in consideration of the right to supply 25% of the Company’s requirements for bulk containers of PGLG for a fifteen-year (the “revised API Agreement”) . The revised API Agreement is effective for a term of five years and will renew automatically for ten successive one-year renewal periods, except as either party may determine. In the revised API agreement, the Company has agreed to purchase a cumulative total of $47.0 million, over the term of the agreement. The revised API Agreement provided for an annual API purchase target of $5 million and a target “profit” ( i.e. , gross margin) to Telcon of $2.5 million. To the extent these targets are not met, which management refers to as a “target shortfall,” Telcon may be entitled to payment of the target shortfall or to settle the target shortfall by exchange of principal and interest on the Telcon convertible bond and proceeds thereof that are pledged as a collateral to secure the Company’s obligations under the API Supply Agreement and the revised API Agreement. In September 2018, the Company entered into an agreement with Ajinomoto Health and Nutrition North America, Inc. (“Ajinomoto”), the producer of the PGLG, and Telcon to facilitate Telcon’s purchase of PGLG from Ajinomoto for resale to the Company under the revised API Agreement. The PGLG raw material purchased from Telcon is recorded in inventory at net realized value and the excess purchase price is recorded against deferred trade discount. Refer to Notes 5 and 6 for more information. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 12 — RELATED PARTY TRANSACTIONS The following table sets forth information relating to loans from related parties outstanding at any time during the nine months ended September 30, 2022 (in thousands): Class Lender Interest Rate Date of Loan Term of Loan Principal Amount Outstanding at September 30, 2022 Highest Principal Outstanding Amount of Principal Repaid Amount of Interest Paid Promissory note payable to related parties: Willis Lee(2) 12% 10/29/2020 Due on Demand 100 100 — — Soomi Niihara(1) 12% 12/7/2021 Due on Demand 700 700 — — Soomi Niihara(1) 12% 1/18/2022 Due on Demand 300 300 — — Yasushi Nagasaki(2) 10% 2/9/2022 Due on Demand 50 50 — — Hope International Hospice, Inc.(1) 10% 2/9/2022 Due on Demand 350 350 — — Hope International Hospice, Inc.(1) 10% 2/15/2022 Due on Demand 210 210 — — Soomi Niihara(1) 10% 2/15/2022 Due on Demand 100 100 — — George Sekulich(2) 10% 2/16/2022 Due on Demand 26 26 — — Soomi Niihara(1) 10% 3/7/2022 Due on Demand 200 200 — — Hope International Hospice, Inc.(1) 12% 3/15/2022 Due on Demand 150 150 — — Hope International Hospice, Inc.(1) 12% 3/30/2022 Due on Demand 150 150 — — Wei Pei Derek Zen(2) 10% 3/31/2022 Due on Demand 200 200 — — Willis Lee(2) 10% 4/14/2022 Due on Demand 45 45 — — Hope International Hospice, Inc.(1) 10% 5/25/2022 Due on Demand 40 40 — — Yutaka and Soomi Niihara(1) 12% 7/27/2022 5 years 402 402 — 8 Hope International Hospice, Inc.(1) 10% 8/15/2022 Due on Demand 50 50 — — Yutaka and Soomi Niihara(1) 10% 8/16/2022 5 years 250 250 — 2 Yutaka and Soomi Niihara(1) 10% 8/16/2022 5 years 1,669 1,669 — 14 Hope International Hospice, Inc.(1) 10% 8/17/2022 Due on Demand 50 50 — — Yutaka and Soomi Niihara(1) 10% 8/17/2022 Due on Demand 60 60 — — Seah Lim(2) 6% 9/16/2022 3 years 1,200 1,200 — — Subtotal $ 6,302 $ 6,302 $ — $ 24 Revolving line of credit agreement Yutaka Niihara(2) 5.25% (3) 12/27/2019 Due on Demand 400 400 — 16 Subtotal 400 400 — 16 Total $ 6,702 $ 6,702 $ — $ 40 The following table sets forth information relating to loans from related parties outstanding at any time during the year ended December 31, 2021: Class Lender Interest Rate Date of Loan Term of Loan Principal Amount Outstanding at December 31, 2021 Highest Principal Outstanding Amount of Principal Repaid Amount of Interest Paid Promissory note payable to related parties: Willis Lee(2) 12% 10/29/2020 Due on Demand $ 100 $ 100 $ — $ — Soomi Niihara(1) 12% 1/20/2021 Due on Demand — 700 700 13 Soomi Niihara(1) 12% 9/15/2021 Due on Demand — 300 300 3 Soomi Niihara(1) 12% 12/7/2021 Due on Demand 700 700 — — Subtotal $ 800 $ 1,800 $ 1,000 $ 16 Revolving line of credit Yutaka Niihara(1) 5.25%(3) 12/27/2019 Due on Demand 400 800 400 35 Subtotal 400 800 400 35 Total $ 1,200 $ 2,600 $ 1,400 $ 51 (1) Dr. Niihara, a Director and the Chairman, and Chief Executive Officer of the Company, is also a director and the Chief Executive Officer of Hope International Hospice, Inc. (2) Officer or director. (3) S ee Note 7 for a discussion of the Company’s revolving line of credit agreement with Dr. Niihara and Note 13 for information regarding recent related party loans. Notes 6 and 11 for a discussion of the Company’s agreements with Telcon, which holds 4,147,491 shares of the Emmaus common stock, or approximately 8.4% of the common stock outstanding as of September 30, 2022. As of September 30, 2022, the Company held a Telcon convertible bond in the principal amount of approximately $18.4 million as discussed in Note 5. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 13 — SUBSEQUENT EVENTS Subsequent to September 30, 2022, the Company redeemed $175,000 principal amount of its outstanding convertible promissory notes. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Nature of Operations | Nature of Operations The Company is a commercial-stage biopharmaceutical company engaged in the discovery, development, marketing and sale of innovative treatments and therapies, primarily for rare and orphan diseases. The Company’s lead product, Endari ® (prescription grade L-glutamine oral powder), is approved by the U.S. Food and Drug Administration, or FDA, to reduce the acute complications of sickle cell disease (“SCD”) in adult and pediatric patients five years of age and older. |
Going concern | Going concern — The accompanying consolidated financial statements have been prepared on the basis that the Company will continue as a going concern. The Company incurred a net loss of $10.8 million for the nine months ended September 30, 2022 and had a working capital deficit of $35.1 million as of September 30, 2022. relating to the commercialization of Endari® in the Middle East North Africa region and elsewhere, will exceed its existing cash balances and cash expected to be generated from operations for the foreseeable future. In order to meet the Company’s current liabilities and future obligations, the Company will need to restructure or refinance its existing indebtedness and raise additional funds through related-party loans, equity or debt financings or licensing or other strategic agreements. The Company is in discussions with the holders of its outstanding convertible promissory notes and certain other creditors to restructure or refinance the convertible promissory notes and other current liabilities but has no understanding or agreement to do so and has no understanding or arrangement for any additional financing. There can be no assurance that the Company will be able to restructure or refinance its existing indebtedness or other current liabilities or complete any additional equity or debt financings on favorable terms, or at all, or enter into licensing or other strategic arrangements. Due to the uncertainty of the Company’s ability to meet its current liabilities and operating expenses, there is substantial doubt about the Company’s ability to continue as a going concern for 12 months from the date of this filing. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. |
Factoring accounts receivables | Factoring accounts receivables — Emmaus Medical, Inc., or Emmaus Medical, an indirect wholly owned subsidiary of Emmaus, is party to a purchase and sales agreement with Prestige Capital Finance, LLC or Prestige Capital, pursuant to which Emmaus Medical may offer and sell to Prestige Capital from time to time eligible accounts receivable in exchange for Prestige Capital’s down payment, or advance, to Emmaus Medical of 75% of the face amount of the accounts receivable, subject to a $7.5 million cap on advances at any time. The balance of the face amount of the accounts receivable will be reserved by Prestige Capital and paid to Emmaus Medical, less fees of Prestige Capital ranging from 2.25 % to 7.25 % of the face amount, as and when Prestige Capital collects the entire face amount of the accounts receivable. Emmaus Medical’s obligations to Prestige Capital under the purchase and sale agreement are secured by a security interest in the accounts receivable and all or substantially all other assets of Emmaus Medical. In connection with the purchase and sale agreement, Emmaus has guaranteed Emmaus Medical’s obligations under the purchase and sale agreement. Accounts receivable included $ and $ of factoring accounts receivable and there were $ and $ 9,000 liabilities related to factoring reflected in other current liabilities at September 30, 2022 and September 30, 2021, respectively . For three and nine months ended September 30, 2022, the Company incurred approximately $ , and $ , respectively, of factoring fees. For three and nine months ended September 30, 2021, the Company incurred approximately $ 106,000 and $ 181,000 , respectively of factori ng fees. |
Net loss per share | Net loss per share — In accordance with Accounting Standard Codification (“ASC”) 260, “Earnings per Share, ” the basic loss per common share is computed by dividing net loss available to common stockholders by the weighted-average number of common shares outstanding. Diluted net loss per share is computed in a manner similar to basic net loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. As of September 30, 2022 and September 30, 2021, the Company had outstanding potentially dilutive securities exercisable for or convertible into 52,635,590 shares and 23,276,594 shares, respectively, of the Company’s common stock. No potentially dilutive securities were included in the calculation of diluted net loss per share since the potential dilutive securities were anti-dilutive for periods ended September 30, 2022 and September 30, 2021. |
REVENUES (Tables)
REVENUES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue From Contract With Customer [Abstract] | |
Summary of revenues disaggregated by category | Revenues disaggregated by category were as follows (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Endari® $ 4,763 $ 5,590 $ 12,072 $ 17,186 Other 177 176 $ 389 404 Revenues, net $ 4,939 $ 5,766 $ 12,460 $ 17,590 |
Revenue Allowance and Accrual Activities | The following table summarizes the revenue allowance and accrual activities for the nine months ended September 30, 2022 and September 30, 2021 (in thousands): Trade Discounts, Allowances and Chargebacks Government Rebates and Other Incentives Returns Total Balance as of December 31, 2021 $ 1,481 $ 3,133 $ 539 $ 5,153 Provision related to sales in the current year 1,859 1,828 210 3,897 Adjustments related to prior period sales (56 ) 18 569 531 Credits and payments made (2,379 ) (1,656 ) (977 ) (5,012 ) Balance as of September 30, 2022 $ 905 $ 3,323 $ 341 $ 4,569 Balance as of December 31, 2020 $ 134 $ 2,119 $ 473 $ 2,726 Provision related to sales in the current year 2,374 2,627 188 5,189 Adjustments related to prior period sales 13 8 (111 ) (90 ) Credits and payments made (1,217 ) (2,201 ) (20 ) (3,438 ) Balance as of September 30, 2021 $ 1,304 $ 2,553 $ 530 $ 4,387 |
Summarizes revenues from each of our customers accounted for 10% or more of net revenues | The following table summarizes revenues attributable to each of our customers that accounted for 10% or more of our net revenues in any of the periods shown: Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Customer A 9 % 31 % 23 % 47 % Customer B 35 % 49 % 27 % 35 % Customer C 13 % 12 % 12 % 10 % Customer D 15 % 0 % 11 % 0 % Customer E 14 % 0 % 7 % 0 % |
SELECTED FINANCIAL STATEMENT _2
SELECTED FINANCIAL STATEMENT - ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of inventory | Inventories consisted of the following (in thousands): September 30, 2022 December 31, 2021 Raw materials and components $ 1,493 $ 1,439 Work-in-process 278 115 Finished goods 5,598 6,228 Inventory reserve (4,630 ) (3,390 ) Total inventories, net $ 2,739 $ 4,392 |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consisted of the following (in thousands): September 30, 2022 December 31, 2021 Prepaid insurance $ 134 $ 660 Prepaid expenses 328 326 Other current assets 511 394 Total prepaid expenses and other current assets $ 973 $ 1,380 |
Schedule of property and equipment | Property and equipment consisted of the following (in thousands): September 30, 2022 December 31, 2021 Equipment $ 360 $ 342 Leasehold improvements 39 39 Furniture and fixtures 99 103 Construction-in-progress — 57 Total property and equipment 498 541 Less: accumulated depreciation (420 ) (394 ) Total property and equipment, net $ 79 $ 147 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Investments [Abstract] | |
Schedule of Fair Value and Changes in Fair Value of Investment in Convertible Bonds | The following table sets forth the fair value and changes in fair value of the investment in the Telcon convertible bond as of September 30, 2022 and December 31, 2021 (in thousands): Investment in convertible bond September 30, 2022 December 31, 2021 Balance, beginning of period $ 26,100 $ 27,866 Sales of convertible bond (2,919 ) — Net loss on investment on convertible bond (126 ) — Change in fair value included in the statement of other comprehensive income (7,112 ) (1,766 ) Balance, end of period $ 15,943 $ 26,100 |
Schedule of Fair Value Based upon Assumptions | The fair value as of September 30, 2022 and December 31, 2021 was based upon following assumptions: September 30, 2022 December 31, 2021 Principal outstanding (South Korean won) KRW 26.5 billion KRW 30 billion Stock price KRW1,075 KRW2,925 Expected life (in years) 8.04 8.79 Selected yield 16.75 % 10.50 % Expected volatility (Telcon common stock) 78.80 % 81.31 % Risk-free interest rate (South Korea government bond) 4.14 % 2.19 % Expected dividend yield — — Conversion price KRW1,150 (US$0.80) KRW2,847 (US$2.39) |
Schedule of Certain Financial Information of EJ Holdings | The following table sets forth certain financial information of EJ Holdings for the three and nine months ended September 30, 2022 and 2021 (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 (Unaudited) (Unaudited) (Unaudited) (Unaudited) REVENUES, NET $ 46 $ 57 $ 148 $ 174 NET LOSS $ (1,077 ) $ (1,657 ) $ (3,725 ) $ (4,998 ) |
SELECTED FINANCIAL STATEMENT _3
SELECTED FINANCIAL STATEMENT CAPTIONS - LIABILITIES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Payables And Accruals [Abstract] | |
Schedule of accounts payable and accrued expenses | Accounts payable and accrued expenses consisted of the following at September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 December 31, 2021 Accounts payable: Clinical and regulatory expenses $ 444 $ 534 Professional fees 579 477 Selling expenses 1,138 932 Manufacturing costs 532 378 Non-employee board member compensation 401 136 Other vendors 313 262 Total accounts payable 3,407 2,719 Accrued interest payable, related parties 325 91 Accrued interest payable 1,673 579 Accrued expenses: Payroll expenses 1,196 1,097 Government rebates and other rebates 4,157 4,371 Other accrued expenses 376 332 Total accrued expenses 5,729 5,800 Total accounts payable and accrued expenses $ 11,134 9,189 |
Schedule of other current liabilities | Other current liabilities consisted of the following at September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 December 31, 2021 Trade discount $ 1,200 $ 3,000 Other current liabilities 1,070 1,404 Total other current liabilities $ 2,270 $ 4,404 |
Schedule of other long-term liabilities | Other long-term liabilities consisted of the following at September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 December 31, 2021 Trade discount $ 22,095 $ 23,148 Unearned revenue 10,000 10,000 Other long-term liabilities 27 25 Total other long-term liabilities $ 32,122 $ 33,173 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Schedule of notes payable | Notes payable consisted of the following at September 30, 2022 and December 31, 2021 (in thousands except for number of underlying shares) excluding the revolving line of credit agreement with related party discussed below: Year Issued Interest Rate Range Term of Notes Conversion Price Principal Outstanding September 30, 2022 Unamortized Discount September 30, 2022 Carrying Amount September 30, 2022 Underlying Shares September 30, 2022 Notes payable 2013 10% Due on demand — $ 692 $ — $ 692 — 2021 11% Due on demand - 2 years — 2,719 — 2,719 — 2022 11%-36% Due on demand - 7 month — 2,243 19 2,224 — $ 5,654 $ 19 $ 5,635 — Current $ 5,654 $ 19 $ 5,635 — Notes payable - related parties 2020 12% Due on demand — 100 — 100 — 2021 12% Due on demand — 700 — 700 — 2022 6%-12% Due on demand - 5 years — 5,501 135 5,361 (c) — $ 6,301 $ 135 $ 6,161 — Current $ 2,780 $ — $ 2,780 — Non-current $ 3,521 $ 135 $ 3,381 — Convertible notes payable 2020(a) 12% 3 years $ 10.00 3,150 — 3,150 320,067 2021(b) 2% 3 years $ 0.37 14,315 3,119 11,196 41,112,131 $ 17,465 $ 3,119 $ 14,346 41,432,198 Current $ 17,465 $ 3,119 $ 14,346 41,432,198 Total $ 29,421 $ 3,273 $ 26,143 41,432,198 Year Issued Interest Rate Range Term of Notes Conversion Price Principal Outstanding December 31, 2021 Unamortized Discount December 31, 2021 Carrying Amount December 31, 2021 Underlying Shares December 31, 2021 Notes payable 2013 10% Due on demand — $ 869 $ — $ 869 — 2021 11% Due on demand - 2 years — 3,030 — 3,030 — $ 3,899 $ — $ 3,899 — Current $ 2,399 $ — $ 2,399 — Non-current $ 1,500 $ — $ 1,500 — Notes payable - related parties 2020 12% Due on demand — $ 100 $ — $ 100 — 2021 12% Due on demand — 700 — 700 — $ 800 $ — $ 800 — Current $ 800 $ — $ 800 — Convertible notes payable 2020(a) 12% 3 years $ 10.00 3,150 — 3,150 316,756 2021(b) 2% 3 years $ 1.48 14,490 4,332 10,158 9,856,343 $ 17,640 $ 4,332 $ 13,308 10,173,099 Current $ 14,490 $ 4,332 $ 10,158 9,856,343 Non-current $ 3,150 $ — $ 3,150 316,756 Total $ 22,339 $ 4,332 $ 18,007 $ 10,173,099 (a) This note is convertible into shares of EMI Holding, Inc., a wholly owned subsidiary of Emmaus Life Sciences, Inc . (b) The notes are convertible into shares of common stock of Emmaus Life Sciences, Inc. Beginning February 28, 2022, the note holders became entitled to call for redemption of the convertible notes payable at any time. Accordingly, the notes are classified as current liabilities. (c) Includes $41,000 of the fair value of embedded derivative. |
Schedule of future contractual principal payments of notes payable | As of September 30, 2022, future contractual principal payments due on notes payable were as follows (in thousands): Year Ending 2022 (three months) $ 25,900 (a) 2025 1,200 2027 2,321 Total $ 29,421 (a) Includes $14.3 million principal amount of convertible notes subject to redemption at any time at the election of the holders. |
Schedule of Fair Value Based upon Assumptions | The fair value as of September 30, 2022 and December 31, 2021 was based upon following assumptions: September 30, 2022 December 31, 2021 Principal outstanding (South Korean won) KRW 26.5 billion KRW 30 billion Stock price KRW1,075 KRW2,925 Expected life (in years) 8.04 8.79 Selected yield 16.75 % 10.50 % Expected volatility (Telcon common stock) 78.80 % 81.31 % Risk-free interest rate (South Korea government bond) 4.14 % 2.19 % Expected dividend yield — — Conversion price KRW1,150 (US$0.80) KRW2,847 (US$2.39) |
Conversion Feature Liabilities [Member] | Convertible Promissory Notes [Member] | |
Schedule of Fair Value Based upon Assumptions | The fair value as of September 30, 2022 and December 31, 2021was based upon following assumptions: Convertible promissory notes September 30, 2022 December 31, 2021 Stock price $ 0.17 $ 1.67 Conversion price $ 0.37 $ 1.48 Selected yield 30.93 % 21.99 % Expected volatility 50 % 50 % Time until maturity (in years) 1.41 2.16 Dividend yield — — Risk-free rate 4.12 % 0.77 % |
Level 3 [Member] | Conversion Feature Liabilities [Member] | |
Schedule of fair value of conversion feature liabilities | The following table sets forth the fair value of the conversion feature liability as of September 30, 2022 and December 31, 2021 (in thousands) Convertible promissory notes September 30, 2022 December 31, 2021 Balance, beginning of period $ 7,507 $ — Fair value at issuance date — 5,594 Change in fair value included in the statement of operations (3,235 ) 1,913 Balance, end of period $ 4,272 $ 7,507 |
STOCKHOLDERS' DEFICIT (Tables)
STOCKHOLDERS' DEFICIT (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Schedule of Fair Value Based upon Assumptions | The fair value as of September 30, 2022 and December 31, 2021 was based upon following assumptions: September 30, 2022 December 31, 2021 Principal outstanding (South Korean won) KRW 26.5 billion KRW 30 billion Stock price KRW1,075 KRW2,925 Expected life (in years) 8.04 8.79 Selected yield 16.75 % 10.50 % Expected volatility (Telcon common stock) 78.80 % 81.31 % Risk-free interest rate (South Korea government bond) 4.14 % 2.19 % Expected dividend yield — — Conversion price KRW1,150 (US$0.80) KRW2,847 (US$2.39) |
Summary of outstanding warrants | A summary of outstanding warrants as of September 30, 2022 and December 31, 2021 is presented below: September 30, 2022 December 31, 2021 Number of Warrants Weighted‑ Average Exercise Price Number of Warrants Weighted‑ Average Exercise Price Warrants outstanding, beginning of period 8,236,017 $ 5.78 8,439,480 $ 6.09 Granted 500,000 $ 2.50 — Exercised — — Cancelled, forfeited or expired (2,125,497 ) $ 14.38 (203,463 ) $ 4.36 Warrants outstanding, end of period 6,610,520 $ 2.88 8,236,017 $ 5.78 Warrants exercisable end of period 6,610,520 $ 2.88 7,486,017 $ 6.12 |
Summary of stock option activity | A summary of outstanding stock options as of September 30, 2022 and December 31, 2021 is presented below. September 30, 2022 December 31, 2021 Number of Options Weighted‑ Average Exercise Price Number of Options Weighted‑ Average Exercise Price Options outstanding, beginning of period 5,968,338 $ 4.78 7,110,025 $ 4.63 Granted or deemed granted — $ — — $ — Exercised — $ — — $ — Cancelled, forfeited and expired (1,055,399 ) $ 3.45 (1,141,687 ) $ 3.82 Options outstanding, end of period 4,912,939 $ 5.07 5,968,338 $ 4.78 Options exercisable, end of period 4,894,938 $ 5.09 5,937,837 $ 4.80 Options available for future grant 4,000,000 4,000,000 |
Convertible Promissory Note [Member] | |
Schedule of fair value of conversion feature liabilities | The following table presents the fair value and the change in fair value of the warrants as of June 15, 2022 and December 31, 2020 (in thousands): Warrant liability—Convertible Promissory Note June 15, 2022 December 31, 2021 Balance, beginning of period $ 1,463 $ 988 Change in fair value included in the statement of operations (1,250 ) 475 Reclassification to equity (213 ) — Balance, end of period $ — $ 1,463 |
Schedule of Fair Value Based upon Assumptions | The fair value of the warrant derivative liability was determined using the Black-Scholes Merton model based upon following assumptions: June 15, 2022 December 31, 2021 Exercise price $ 2.05 $ 2.05 Stock price $ 0.36 $ 1.67 Risk‑free interest rate 3.35 % 1.04 % Expected volatility (peer group) 126.00 % 117.00 % Expected life (in years) 3.00 3.46 Expected dividend yield — — Number outstanding 1,250,000 1,250,000 |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Schedule of future minimum lease payments | Future minimum lease payments under the lease agreements were as follows as of September 30, 2022 (in thousands): Amount 2022 (three months) $ 263 2023 1,049 2024 1,063 2025 1,092 2026 836 Total lease payments 4,303 Less: Interest 887 Present value of lease liabilities $ 3,416 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
Schedule of outstanding loans from related parties | The following table sets forth information relating to loans from related parties outstanding at any time during the nine months ended September 30, 2022 (in thousands): Class Lender Interest Rate Date of Loan Term of Loan Principal Amount Outstanding at September 30, 2022 Highest Principal Outstanding Amount of Principal Repaid Amount of Interest Paid Promissory note payable to related parties: Willis Lee(2) 12% 10/29/2020 Due on Demand 100 100 — — Soomi Niihara(1) 12% 12/7/2021 Due on Demand 700 700 — — Soomi Niihara(1) 12% 1/18/2022 Due on Demand 300 300 — — Yasushi Nagasaki(2) 10% 2/9/2022 Due on Demand 50 50 — — Hope International Hospice, Inc.(1) 10% 2/9/2022 Due on Demand 350 350 — — Hope International Hospice, Inc.(1) 10% 2/15/2022 Due on Demand 210 210 — — Soomi Niihara(1) 10% 2/15/2022 Due on Demand 100 100 — — George Sekulich(2) 10% 2/16/2022 Due on Demand 26 26 — — Soomi Niihara(1) 10% 3/7/2022 Due on Demand 200 200 — — Hope International Hospice, Inc.(1) 12% 3/15/2022 Due on Demand 150 150 — — Hope International Hospice, Inc.(1) 12% 3/30/2022 Due on Demand 150 150 — — Wei Pei Derek Zen(2) 10% 3/31/2022 Due on Demand 200 200 — — Willis Lee(2) 10% 4/14/2022 Due on Demand 45 45 — — Hope International Hospice, Inc.(1) 10% 5/25/2022 Due on Demand 40 40 — — Yutaka and Soomi Niihara(1) 12% 7/27/2022 5 years 402 402 — 8 Hope International Hospice, Inc.(1) 10% 8/15/2022 Due on Demand 50 50 — — Yutaka and Soomi Niihara(1) 10% 8/16/2022 5 years 250 250 — 2 Yutaka and Soomi Niihara(1) 10% 8/16/2022 5 years 1,669 1,669 — 14 Hope International Hospice, Inc.(1) 10% 8/17/2022 Due on Demand 50 50 — — Yutaka and Soomi Niihara(1) 10% 8/17/2022 Due on Demand 60 60 — — Seah Lim(2) 6% 9/16/2022 3 years 1,200 1,200 — — Subtotal $ 6,302 $ 6,302 $ — $ 24 Revolving line of credit agreement Yutaka Niihara(2) 5.25% (3) 12/27/2019 Due on Demand 400 400 — 16 Subtotal 400 400 — 16 Total $ 6,702 $ 6,702 $ — $ 40 The following table sets forth information relating to loans from related parties outstanding at any time during the year ended December 31, 2021: Class Lender Interest Rate Date of Loan Term of Loan Principal Amount Outstanding at December 31, 2021 Highest Principal Outstanding Amount of Principal Repaid Amount of Interest Paid Promissory note payable to related parties: Willis Lee(2) 12% 10/29/2020 Due on Demand $ 100 $ 100 $ — $ — Soomi Niihara(1) 12% 1/20/2021 Due on Demand — 700 700 13 Soomi Niihara(1) 12% 9/15/2021 Due on Demand — 300 300 3 Soomi Niihara(1) 12% 12/7/2021 Due on Demand 700 700 — — Subtotal $ 800 $ 1,800 $ 1,000 $ 16 Revolving line of credit Yutaka Niihara(1) 5.25%(3) 12/27/2019 Due on Demand 400 800 400 35 Subtotal 400 800 400 35 Total $ 1,200 $ 2,600 $ 1,400 $ 51 (1) Dr. Niihara, a Director and the Chairman, and Chief Executive Officer of the Company, is also a director and the Chief Executive Officer of Hope International Hospice, Inc. (2) Officer or director. (3) |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||||
Feb. 22, 2021 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Summary Of Significant Accounting Policy [Line Items] | ||||||||||
Net income (loss) | $ (391,000) | $ (8,892,000) | $ (1,542,000) | $ (3,151,000) | $ 2,489,000 | $ (8,422,000) | $ (10,825,000) | $ (9,084,000) | ||
Working capital deficit | 35,100,000 | 35,100,000 | ||||||||
Accounts receivable, net | 1,491,000 | 1,491,000 | $ 1,040,000 | |||||||
Other current liabilities | 2,270,000 | $ 2,270,000 | $ 4,404,000 | |||||||
Potentially dilutive securities outstanding | 52,635,590 | 23,276,594 | ||||||||
Prestige Capital Finance, LLC [Member] | Purchase and Sale Agreement [Member] | ||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||
Percentage of down payment or advance receivable on face amount of accounts receivable at time of sale of accounts receivable | 75% | |||||||||
Cap on advances under agreement | $ 7,500,000 | |||||||||
Accounts receivable, net | 86,000 | 472,000 | $ 86,000 | $ 472,000 | ||||||
Other current liabilities | 17,000 | 9,000 | 17,000 | 9,000 | ||||||
Factoring fee | $ 121,000 | $ 106,000 | $ 275,000 | $ 181,000 | ||||||
Prestige Capital Finance, LLC [Member] | Purchase and Sale Agreement [Member] | Minimum [Member] | ||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||
Percentage of discount fees on face amount of accounts receivable | 2.25% | |||||||||
Prestige Capital Finance, LLC [Member] | Purchase and Sale Agreement [Member] | Maximum [Member] | ||||||||||
Summary Of Significant Accounting Policy [Line Items] | ||||||||||
Percentage of discount fees on face amount of accounts receivable | 7.25% |
REVENUES (Details)
REVENUES (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation Of Revenue [Line Items] | ||||
Revenues, net | $ 4,939 | $ 5,766 | $ 12,460 | $ 17,590 |
Endari [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues, net | 4,763 | 5,590 | 12,072 | 17,186 |
Other [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues, net | $ 177 | $ 176 | $ 389 | $ 404 |
REVENUES (Details 1)
REVENUES (Details 1) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation Of Revenue [Line Items] | ||
Beginning balance | $ 5,153 | $ 2,726 |
Provision related to sales in the current year | 3,897 | 5,189 |
Adjustments related to prior period sales | 531 | (90) |
Credits and payments made | (5,012) | (3,438) |
Ending balance | 4,569 | 4,387 |
Trade Discounts, Allowances and Chargebacks [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Beginning balance | 1,481 | 134 |
Provision related to sales in the current year | 1,859 | 2,374 |
Adjustments related to prior period sales | (56) | 13 |
Credits and payments made | (2,379) | (1,217) |
Ending balance | 905 | 1,304 |
Government Rebates and Other Incentives [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Beginning balance | 3,133 | 2,119 |
Provision related to sales in the current year | 1,828 | 2,627 |
Adjustments related to prior period sales | 18 | 8 |
Credits and payments made | (1,656) | (2,201) |
Ending balance | 3,323 | 2,553 |
Returns [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Beginning balance | 539 | 473 |
Provision related to sales in the current year | 210 | 188 |
Adjustments related to prior period sales | 569 | (111) |
Credits and payments made | (977) | (20) |
Ending balance | $ 341 | $ 530 |
REVENUES (Details 2)
REVENUES (Details 2) - Revenue Benchmark [Member] - Customer Concentration Risk [Member] | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Customer A [Member] | ||||
Entity Wide Revenue Major Customer [Line Items] | ||||
Concentration risk, percentage | 9% | 31% | 23% | 47% |
Customer B [Member] | ||||
Entity Wide Revenue Major Customer [Line Items] | ||||
Concentration risk, percentage | 35% | 49% | 27% | 35% |
Customer C [Member] | ||||
Entity Wide Revenue Major Customer [Line Items] | ||||
Concentration risk, percentage | 13% | 12% | 12% | 10% |
Customer D [Member] | ||||
Entity Wide Revenue Major Customer [Line Items] | ||||
Concentration risk, percentage | 15% | 0% | 11% | 0% |
Customer E [Member] | ||||
Entity Wide Revenue Major Customer [Line Items] | ||||
Concentration risk, percentage | 14% | 0% | 7% | 0% |
REVENUES (Details Narrative)
REVENUES (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |||||
Revenue from contract | $ 4,939 | $ 5,766 | $ 12,460 | $ 17,590 | |
Telcon, Inc. ("Telcon") [Member] | |||||
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |||||
Upfront payment | 10,000 | ||||
Telcon, Inc. ("Telcon") [Member] | Distribution Agreement [Member] | |||||
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |||||
Revenue from contract | $ 10,000 | $ 10,000 |
SELECTED FINANCIAL STATEMENT _4
SELECTED FINANCIAL STATEMENT - ASSETS (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials and components | $ 1,493 | $ 1,439 |
Work-in-process | 278 | 115 |
Finished goods | 5,598 | 6,228 |
Inventory reserve | (4,630) | (3,390) |
Total inventories, net | $ 2,739 | $ 4,392 |
SELECTED FINANCIAL STATEMENT _5
SELECTED FINANCIAL STATEMENT - ASSETS (Details 1) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Prepaid Expense And Other Assets Current [Abstract] | ||
Prepaid insurance | $ 134 | $ 660 |
Prepaid expenses | 328 | 326 |
Other current assets | 511 | 394 |
Total prepaid expenses and other current assets | $ 973 | $ 1,380 |
SELECTED FINANCIAL STATEMENT _6
SELECTED FINANCIAL STATEMENT - ASSETS (Details 2) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Property and equipment | ||
Property and equipment, gross | $ 498 | $ 541 |
Less: accumulated depreciation | (420) | (394) |
Total property and equipment, net | 79 | 147 |
Equipment [Member] | ||
Property and equipment | ||
Property and equipment, gross | 360 | 342 |
Leasehold Improvements [Member] | ||
Property and equipment | ||
Property and equipment, gross | 39 | 39 |
Furniture and Fixtures [Member] | ||
Property and equipment | ||
Property and equipment, gross | $ 99 | 103 |
Construction in Progress [Member] | ||
Property and equipment | ||
Property and equipment, gross | $ 57 |
SELECTED FINANCIAL STATEMENT _7
SELECTED FINANCIAL STATEMENT - ASSETS (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Property Plant And Equipment [Abstract] | ||||
Depreciation expense | $ 9,000 | $ 11,000 | $ 30,000 | $ 34,000 |
INVESTMENTS (Details Narrative)
INVESTMENTS (Details Narrative) ₩ / shares in Units, $ / shares in Units, ₩ in Millions | 1 Months Ended | 12 Months Ended | |||||||||
Sep. 28, 2020 USD ($) $ / shares | Sep. 28, 2020 ₩ / shares | Oct. 31, 2018 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 KRW (₩) | Dec. 31, 2020 USD ($) | Dec. 31, 2020 KRW (₩) | Sep. 30, 2022 USD ($) | Feb. 28, 2022 USD ($) | Feb. 28, 2022 KRW (₩) | Dec. 31, 2018 USD ($) | |
Schedule Of Investments [Line Items] | |||||||||||
Call option agreement date | Sep. 28, 2020 | ||||||||||
Realized net loss on investment bond | $ 126,000 | $ 126,000 | |||||||||
Other income | 41,000 | 41,000 | |||||||||
EJ Holdings, Inc. [Member] | |||||||||||
Schedule Of Investments [Line Items] | |||||||||||
Secured debt percentage | 1% | ||||||||||
Investment amount | $ 32,000 | ||||||||||
Percentage of voting interest | 40% | ||||||||||
Unsecured debt | $ 13,200,000 | ||||||||||
Debt instrument, maturity date | Sep. 30, 2028 | ||||||||||
Unsecured debt, additional borrowings | $ 4,200,000 | ||||||||||
Loan receivables | 22,600,000 | $ 21,700,000 | |||||||||
EJ Holdings, Inc. [Member] | Japan Industrial Partners [Member] | |||||||||||
Schedule Of Investments [Line Items] | |||||||||||
Equity method investment, ownership percentage | 60% | ||||||||||
Maximum [Member] | |||||||||||
Schedule Of Investments [Line Items] | |||||||||||
Percentage of principal amount of convertible bond to be repurchased | 50% | ||||||||||
Telcon, Inc. ("Telcon") [Member] | |||||||||||
Schedule Of Investments [Line Items] | |||||||||||
Convertible bond maturity date | Oct. 16, 2030 | ||||||||||
Secured debt percentage | 2.10% | 2.10% | |||||||||
Convertible bond initial conversion price | (per share) | $ 8 | ₩ 9,232 | |||||||||
Offset amount against principal amount of convertible bond | $ 2,900,000 | ₩ 3,500 | |||||||||
Cash proceeds to shortfall in revenue and profits | $ 310,000 | ₩ 400 | $ 310,000 | ₩ 400 | |||||||
Convertible Bond Purchase Agreement [Member] | Telcon, Inc. ("Telcon") [Member] | |||||||||||
Schedule Of Investments [Line Items] | |||||||||||
Purchase of principal amount of convertible bond at face value | $ 26,100,000 |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Schedule Of Investments [Line Items] | ||
Balance, beginning of period | $ 26,100 | $ 27,866 |
Sales of convertible bond | (2,919) | |
Net loss on investment on convertible bond | (126) | |
Change in fair value included in the statement of other comprehensive income | (7,112) | (1,766) |
Balance, end of period | $ 15,943 | $ 26,100 |
INVESTMENTS (Details 1)
INVESTMENTS (Details 1) - Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] ₩ / shares in Units, ₩ in Billions | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 $ / shares | Dec. 31, 2021 $ / shares | Sep. 30, 2022 KRW (₩) ₩ / shares | Dec. 31, 2021 KRW (₩) ₩ / shares | |
Schedule Of Investments [Line Items] | ||||
Principal outstanding (South Korean won) | ₩ | ₩ 26.5 | ₩ 30 | ||
Stock price | ₩ / shares | ₩ 1,075 | ₩ 2,925 | ||
Expected Life (in years) [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Expected life (in years) | 8 years 14 days | 8 years 9 months 14 days | ||
Selected Yield [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Investment in convertible bonds, measurement input | 16.75 | 10.50 | ||
Expected Volatility (Telcon common stock) [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Investment in convertible bonds, measurement input | 78.80 | 81.31 | ||
Risk-free Interest Rate (South Korea government bond) [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Investment in convertible bonds, measurement input | 4.14 | 2.19 | ||
Conversion Price [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Conversion price | (per share) | $ 0.80 | $ 2.39 | ₩ 1,150 | ₩ 2,847 |
INVESTMENTS (Details 2)
INVESTMENTS (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Schedule Of Investments [Line Items] | ||||
REVENUES, NET | $ 4,939 | $ 5,766 | $ 12,460 | $ 17,590 |
NET LOSS | (10,825) | (9,084) | ||
EJ Holdings, Inc. [Member] | ||||
Schedule Of Investments [Line Items] | ||||
REVENUES, NET | 46 | 57 | 148 | 174 |
NET LOSS | $ (1,077) | $ (1,657) | $ (3,725) | $ (4,998) |
SELECTED FINANCIAL STATEMENT _8
SELECTED FINANCIAL STATEMENT CAPTIONS - LIABILITIES (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Accounts payable: | ||
Clinical and regulatory expenses | $ 444 | $ 534 |
Professional fees | 579 | 477 |
Selling expenses | 1,138 | 932 |
Manufacturing costs | 532 | 378 |
Non-employee board member compensation | 401 | 136 |
Other vendors | 313 | 262 |
Total accounts payable | 3,407 | 2,719 |
Accrued interest payable, related parties | 325 | 91 |
Accrued interest payable | 1,673 | 579 |
Accrued expenses: | ||
Payroll expenses | 1,196 | 1,097 |
Government rebates and other rebates | 4,157 | 4,371 |
Other accrued expenses | 376 | 332 |
Total accrued expenses | 5,729 | 5,800 |
Total accounts payable and accrued expenses | $ 11,134 | $ 9,189 |
SELECTED FINANCIAL STATEMENT _9
SELECTED FINANCIAL STATEMENT CAPTIONS - LIABILITIES (Details 1) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Other Current Liabilities [Line Items] | ||
Other current liabilities | $ 2,270 | $ 4,404 |
Trade Discount [Member] | ||
Other Current Liabilities [Line Items] | ||
Other current liabilities | 1,200 | 3,000 |
Other Current Liabilities [Member] | ||
Other Current Liabilities [Line Items] | ||
Other current liabilities | $ 1,070 | $ 1,404 |
SELECTED FINANCIAL STATEMENT_10
SELECTED FINANCIAL STATEMENT CAPTIONS - LIABILITIES (Details 2) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Other Long Term Liabilities [Line Items] | ||
Other long-term liabilities | $ 32,122 | $ 33,173 |
Trade Discount [Member] | ||
Other Long Term Liabilities [Line Items] | ||
Other long-term liabilities | 22,095 | 23,148 |
Unearned Revenue [Member] | ||
Other Long Term Liabilities [Line Items] | ||
Other long-term liabilities | 10,000 | 10,000 |
Other Long-Term Liabilities [Member] | ||
Other Long Term Liabilities [Line Items] | ||
Other long-term liabilities | $ 27 | $ 25 |
SELECTED FINANCIAL STATEMENT_11
SELECTED FINANCIAL STATEMENT CAPTIONS - LIABILITIES (Details Narrative) - Telcon, Inc. ("Telcon") [Member] - USD ($) | 9 Months Ended | ||||
Jul. 12, 2017 | Jun. 12, 2017 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
API Supply Agreement [Member] | |||||
Summary Of Significant Accounting Policy [Line Items] | |||||
Proceeds from supply agreement | $ 31,800,000 | ||||
API Supply Agreement [Member] | PGLG [Member] | |||||
Summary Of Significant Accounting Policy [Line Items] | |||||
PGLG, purchase price | $ 523,000 | $ 250,000 | |||
Accounts payables outstanding | $ 537,000 | $ 382,000 | |||
Revised API Agreement [Member] | |||||
Summary Of Significant Accounting Policy [Line Items] | |||||
Annual purchase target amount | $ 5,000,000 | ||||
Target profit | $ 2,500,000 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2022 USD ($) Equity_Instrument $ / shares | Dec. 31, 2021 USD ($) Equity_Instrument $ / shares | ||
Debt Instrument [Line Items] | |||
Principal Outstanding | $ 29,421,000 | $ 22,339,000 | |
Unamortized Discount | 3,273,000 | 4,332,000 | |
Carrying Amount | $ 26,143,000 | $ 18,007,000 | |
Underlying Shares Notes | Equity_Instrument | 41,432,198 | 10,173,099 | |
2013 Notes payable [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 10% | 10% | |
Term of Notes | Due on demand | Due on demand | |
Principal Outstanding | $ 692,000 | $ 869,000 | |
Carrying Amount | $ 692,000 | $ 869,000 | |
2021 Notes payable [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 11% | 11% | |
Term of Notes | Due on demand | Due on demand | |
Term of Notes | 2 years | 2 years | |
Principal Outstanding | $ 2,719,000 | $ 3,030,000 | |
Carrying Amount | $ 2,719,000 | 3,030,000 | |
2022 Notes payable [Member] | |||
Debt Instrument [Line Items] | |||
Term of Notes | Due on demand | ||
Term of Notes | 10 months | ||
Principal Outstanding | $ 2,243,000 | ||
Unamortized Discount | 19,000 | ||
Carrying Amount | $ 2,224,000 | ||
2022 Notes payable [Member] | Minimum [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 11% | ||
2022 Notes payable [Member] | Maximum [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 41% | ||
Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Principal Outstanding | $ 5,654,000 | 3,899,000 | |
Unamortized Discount | 19,000 | ||
Carrying Amount | 5,635,000 | 3,899,000 | |
Principal Outstanding, Current | 5,654,000 | 2,399,000 | |
Unamortized Discount, Current | 19,000 | ||
Notes payable, current | $ 5,635,000 | 2,399,000 | |
Principal Outstanding, Non Current | 1,500,000 | ||
Notes payable, non-current | $ 1,500,000 | ||
2020 Notes payable - related parties [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 12% | 12% | |
Term of Notes | Due on demand | Due on demand | |
Principal Outstanding | $ 100,000 | $ 100,000 | |
Carrying Amount | $ 100,000 | $ 100,000 | |
2021 Notes payable - related parties [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 12% | 12% | |
Term of Notes | Due on demand | Due on demand | |
Principal Outstanding | $ 700,000 | $ 700,000 | |
Carrying Amount | $ 700,000 | 700,000 | |
2022 Notes payable - related parties [Member] | |||
Debt Instrument [Line Items] | |||
Term of Notes | Due on demand | ||
Term of Notes | 5 years | ||
Principal Outstanding | $ 5,501,000 | ||
Unamortized Discount | 135,000 | ||
Carrying Amount | [1] | 5,361,000 | |
Fair values of the embedded derivatives | $ 41,000 | ||
2022 Notes payable - related parties [Member] | Minimum [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 6% | ||
2022 Notes payable - related parties [Member] | Maximum [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 12% | ||
Notes payable - related parties [Member] | |||
Debt Instrument [Line Items] | |||
Principal Outstanding | $ 6,301,000 | 800,000 | |
Unamortized Discount | 135,000 | ||
Carrying Amount | 6,161,000 | 800,000 | |
Principal Outstanding, Current | 2,780,000 | 800,000 | |
Notes payable, current | 2,780,000 | $ 800,000 | |
Principal Outstanding, Non Current | 3,521,000 | ||
Unamortized Discount, Non Current | 135,000 | ||
Notes payable, non-current | $ 3,381,000 | ||
2021 Convertible Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | [2] | 2% | 2% |
Term of Notes | [2] | 3 years | 3 years |
Term of Notes | [2] | 3 years | 3 years |
Conversion Price | $ / shares | [2] | $ 0.37 | $ 1.48 |
Principal Outstanding | [2] | $ 14,315,000 | $ 14,490,000 |
Unamortized Discount | [2] | 3,119,000 | 4,332,000 |
Carrying Amount | [2] | $ 11,196,000 | $ 10,158,000 |
Underlying Shares Notes | Equity_Instrument | [2] | 41,112,131 | 9,856,343 |
Convertible Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Principal Outstanding | $ 17,465,000 | $ 17,640,000 | |
Unamortized Discount | 3,119,000 | 4,332,000 | |
Carrying Amount | $ 14,346,000 | $ 13,308,000 | |
Underlying Shares Notes | Equity_Instrument | 41,432,198 | 10,173,099 | |
Principal Outstanding, Current | $ 17,465,000 | $ 14,490,000 | |
Unamortized Discount, Current | 3,119,000 | 4,332,000 | |
Notes payable, current | $ 14,346,000 | $ 10,158,000 | |
Underlying Shares Notes, Current | Equity_Instrument | 41,432,198 | 9,856,343 | |
Principal Outstanding, Non Current | $ 3,150,000 | ||
Notes payable, non-current | $ 3,150,000 | ||
Underlying Shares Notes, Non Current | Equity_Instrument | 316,756 | ||
2020 Convertible Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | [3] | 12% | 12% |
Term of Notes | [3] | 3 years | 3 years |
Term of Notes | [3] | 3 years | 3 years |
Conversion Price | $ / shares | [3] | $ 10 | $ 10 |
Principal Outstanding | [3] | $ 3,150,000 | $ 3,150,000 |
Carrying Amount | [3] | $ 3,150,000 | $ 3,150,000 |
Underlying Shares Notes | Equity_Instrument | [3] | 320,067 | 316,756 |
[1]Includes $41,000 of the fair value of embedded derivative.[2] The notes are convertible into shares of common stock of Emmaus Life Sciences, Inc. Beginning February 28, 2022, the note holders became entitled to call for redemption of the convertible notes payable at any time. Accordingly, the notes are classified as current liabilities. This note is convertible into shares of EMI Holding, Inc., a wholly owned subsidiary of Emmaus Life Sciences, Inc . |
NOTES PAYABLE (Details 1)
NOTES PAYABLE (Details 1) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2022 USD ($) Equity_Instrument $ / shares | Dec. 31, 2021 USD ($) Equity_Instrument $ / shares | ||
Debt Instrument [Line Items] | |||
Principal Outstanding | $ 29,421 | $ 22,339 | |
Unamortized Discount | 3,273 | 4,332 | |
Carrying Amount | $ 26,143 | $ 18,007 | |
Underlying Shares Notes | Equity_Instrument | 41,432,198 | 10,173,099 | |
Convertible notes payable, current | $ 14,346 | $ 10,158 | |
2021 Convertible Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | [1] | 2% | 2% |
Term of Notes | [1] | 3 years | 3 years |
Conversion Price | $ / shares | [1] | $ 0.37 | $ 1.48 |
Principal Outstanding | [1] | $ 14,315 | $ 14,490 |
Unamortized Discount | [1] | 3,119 | 4,332 |
Carrying Amount | [1] | $ 11,196 | $ 10,158 |
Underlying Shares Notes | Equity_Instrument | [1] | 41,112,131 | 9,856,343 |
Convertible Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Principal Outstanding | $ 17,465 | $ 17,640 | |
Unamortized Discount | 3,119 | 4,332 | |
Carrying Amount | $ 14,346 | $ 13,308 | |
Underlying Shares Notes | Equity_Instrument | 41,432,198 | 10,173,099 | |
Principal Outstanding, Current | $ 17,465 | $ 14,490 | |
Unamortized Discount, Current | 3,119 | 4,332 | |
Convertible notes payable, current | $ 14,346 | $ 10,158 | |
Underlying Shares Notes, Current | Equity_Instrument | 41,432,198 | 9,856,343 | |
Principal Outstanding, Non Current | $ 3,150 | ||
Notes payable, non-current | $ 3,150 | ||
Underlying Shares Notes, Non Current | Equity_Instrument | 316,756 | ||
2020 Convertible Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | [2] | 12% | 12% |
Term of Notes | [2] | 3 years | 3 years |
Conversion Price | $ / shares | [2] | $ 10 | $ 10 |
Principal Outstanding | [2] | $ 3,150 | $ 3,150 |
Carrying Amount | [2] | $ 3,150 | $ 3,150 |
Underlying Shares Notes | Equity_Instrument | [2] | 320,067 | 316,756 |
Notes payable - related parties [Member] | |||
Debt Instrument [Line Items] | |||
Principal Outstanding | $ 6,301 | $ 800 | |
Unamortized Discount | 135 | ||
Carrying Amount | 6,161 | 800 | |
Principal Outstanding, Current | 2,780 | $ 800 | |
Principal Outstanding, Non Current | 3,521 | ||
Unamortized Discount, Non Current | 135 | ||
Notes payable, non-current | $ 3,381 | ||
[1] The notes are convertible into shares of common stock of Emmaus Life Sciences, Inc. Beginning February 28, 2022, the note holders became entitled to call for redemption of the convertible notes payable at any time. Accordingly, the notes are classified as current liabilities. This note is convertible into shares of EMI Holding, Inc., a wholly owned subsidiary of Emmaus Life Sciences, Inc . |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||
Aug. 15, 2022 | Feb. 09, 2021 | Sep. 30, 2022 | Aug. 31, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Oct. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 15, 2020 | |
Debt Instrument [Line Items] | |||||||||||||
Weighted-average stated annual interest rate | 7% | 7% | 7% | 6% | |||||||||
Weighted-average effective annual interest rate | 19% | 19% | 19% | 15% | |||||||||
Proceeds from convertible notes payable issued | $ 14,490,000 | ||||||||||||
Debt Instrument Principle Payments | $ 1,600,000 | ||||||||||||
Loss on debt extinguishment | $ 421,000 | $ 421,000 | 1,172,000 | ||||||||||
Issuance cost | $ 32,000 | ||||||||||||
Fair value of warrants | 84,000 | ||||||||||||
Common stock | $ 50,000 | $ 50,000 | $ 50,000 | $ 49,000 | |||||||||
Hope International Hospice, Inc. [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Principal amount | $ 50,000 | ||||||||||||
Interest rate | 10% | ||||||||||||
Prepayment amount | $ 1,924,819 | ||||||||||||
Emmaus Medical [Member] | Receivables Purchased Amount [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Sale of accounts receivable | 694,960 | 816,000 | |||||||||||
Proceeds from sale of notes receivable | 500,000 | 516,000 | |||||||||||
Weekly amount to be received under agreement by third party | $ 25,969 | $ 34,000 | |||||||||||
Business Loan and Security Agreement [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Principal amount | $ 1,800,000 | ||||||||||||
Net proceeds | 1,666,000 | ||||||||||||
Installment payment | $ 738,000 | ||||||||||||
Prepayment Period | 90 days | ||||||||||||
Prepayment amount | $ 2,250,000 | ||||||||||||
Loss on debt extinguishment | $ 421,000 | ||||||||||||
Business Loan and Security Agreement [Member] | First Eight Weeks [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Installment payment | 31,725 | ||||||||||||
Business Loan and Security Agreement [Member] | Remaining 32 Weeks [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Installment payment | $ 71,381 | ||||||||||||
Promissory Notes [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Interest rate | 10% | 12% | |||||||||||
Debt instrument, maturity date | Aug. 16, 2027 | Jul. 31, 2027 | |||||||||||
Promissory Notes [Member] | Unaffiliated Third Parties [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Principal amount | $ 1,668,751 | $ 402,000 | |||||||||||
Promissory Notes [Member] | Personal Funds [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Principal amount | 250,000 | ||||||||||||
Securities Purchase Agreement [Member] | Convertible Promissory Note [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Proceeds from convertible notes payable issued | $ 14,500,000 | ||||||||||||
Conversion price | $ 1.48 | $ 0.37 | $ 0.37 | $ 0.37 | |||||||||
Debt instrument, frequency of periodic payment | The convertible promissory notes bear interest at the stated rate of 2% per year (10% in the event of a default), payable semi-annually on the last business day of August and January of each year and will mature on the 3rd anniversary of the original issue date, unless earlier converted or prepaid. | ||||||||||||
Interest rate | 2% | 11% | 12% | ||||||||||
Interest rate in event of default | 10% | ||||||||||||
Debt instrument prepayment percentage of principle amount thereafter | 50% | ||||||||||||
Maximum [Member] | Securities Purchase Agreement [Member] | Convertible Promissory Note [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Principal amount | $ 17,000,000 | ||||||||||||
Debt instrument prepayment percentage of principle amount any time before February 28, 2033 | 50% | ||||||||||||
Dr. Niihara and His Wife [Member] | Promissory Notes [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Principal amount | 1,576,574 | $ 370,000 | |||||||||||
Seah Lim [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Principal amount | $ 1,200,000 | ||||||||||||
Interest rate | 6% | ||||||||||||
Debt instrument, maturity date | Sep. 30, 2025 | ||||||||||||
Common stock | $ 240,000 | ||||||||||||
Fair values of the embedded derivatives | $ 41,000 | $ 41,000 | $ 41,000 | $ 68,000 | |||||||||
Revolving Line of Credit Facility [Member] | Prime Rate [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument variable annual rate | 3% | ||||||||||||
Revolving Line of Credit Facility [Member] | Dr. Yutaka Niihara [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Line of credit maximum borrowing capacity | 1,000,000 | 1,000,000 | $ 1,000,000 | ||||||||||
Line of credit outstanding principal balances | $ 400,000 | $ 400,000 | $ 400,000 | $ 400,000 | |||||||||
Line of credit effective interest rate | 10.40% | 10.40% | 10.40% | ||||||||||
Line of credit expiration date | Nov. 22, 2022 |
NOTES PAYABLE (Details 2)
NOTES PAYABLE (Details 2) $ in Thousands | Sep. 30, 2022 USD ($) |
Long Term Debt By Maturity [Abstract] | |
2022 (three months) | $ 25,900 |
2025 | 1,200 |
2027 | 2,321 |
Total | $ 29,421 |
NOTES PAYABLE (Details 3)
NOTES PAYABLE (Details 3) $ in Millions | Feb. 28, 2022 USD ($) |
Convertible Notes Payable [Member] | |
Debt Instrument [Line Items] | |
Principal amount | $ 14.3 |
NOTES PAYABLE (Details 4)
NOTES PAYABLE (Details 4) - Convertible Promissory Notes [Member] - Conversion Feature Liabilities [Member] - Other Current Liabilities [Member] - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Balance, beginning of period | $ 7,507 | |
Fair value at issuance date | $ 5,594 | |
Change in fair value included in the statement of operations | (3,235) | 1,913 |
Balance, end of period | $ 4,272 | $ 7,507 |
NOTES PAYABLE (Details 5)
NOTES PAYABLE (Details 5) - Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] | Sep. 30, 2022 $ / shares | Sep. 30, 2022 ₩ / shares | Dec. 31, 2021 $ / shares | Dec. 31, 2021 ₩ / shares |
Debt Instrument [Line Items] | ||||
Stock price | ₩ / shares | ₩ 1,075 | ₩ 2,925 | ||
Convertible Promissory Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Stock price | $ 0.17 | $ 1.67 | ||
Conversion Price [Member] | ||||
Debt Instrument [Line Items] | ||||
Conversion price | (per share) | 0.80 | ₩ 1,150 | 2.39 | ₩ 2,847 |
Conversion Price [Member] | Convertible Promissory Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Conversion price | $ 0.37 | $ 1.48 | ||
Selected Yield [Member] | Convertible Promissory Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Selected yield | 30.93 | 30.93 | 21.99 | 21.99 |
Expected Volatility [Member] | Convertible Promissory Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Selected yield | 50 | 50 | 50 | 50 |
Time Until Maturity [Member] | Convertible Promissory Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Expected life (in years) | 1 year 4 months 28 days | 1 year 4 months 28 days | 2 years 1 month 28 days | 2 years 1 month 28 days |
Risk-Free Rate [Member] | Convertible Promissory Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Selected yield | 4.12 | 4.12 | 0.77 | 0.77 |
STOCKHOLDERS' DEFICIT (Details
STOCKHOLDERS' DEFICIT (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||||||||||
Feb. 26, 2021 | Jun. 15, 2020 | Jun. 30, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Sep. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Jun. 15, 2022 | Dec. 31, 2021 | Sep. 29, 2021 | Feb. 09, 2021 | Dec. 31, 2020 | |
Class Of Warrant Or Right [Line Items] | |||||||||||||||
Convertible notes principal amount | $ 26,143,000 | $ 26,143,000 | $ 18,007,000 | ||||||||||||
Debt instrument exercise price | $ 2.50 | $ 2.50 | |||||||||||||
Warrants granted, term | 5 years | ||||||||||||||
Warrants granted to purchase common stock | 500,000 | 500,000 | |||||||||||||
Warrant derivative liabilities | $ 33,000 | $ 33,000 | $ 1,503,000 | ||||||||||||
Change in fair value of warrant derivative liabilities | $ 51,000 | $ (131,000) | $ 1,341,000 | $ (322,000) | |||||||||||
Weighted average remaining contractual life (years), outstanding | 2 years 3 months 18 days | ||||||||||||||
Common stock, issued | 49,558,501 | 49,558,501 | 49,311,864 | 4,000,000 | |||||||||||
Share-based compensation | $ 13,000 | 548,000 | |||||||||||||
Research and development | $ 432,000 | 470,000 | $ 1,196,000 | 3,032,000 | |||||||||||
Adjustment of warrants change in fair value increase additional paid in capital and accumulated loss | $ 446,000 | ||||||||||||||
Common stock issued for services | $ 110,000 | $ 500,000 | |||||||||||||
Common Stock [Member] | |||||||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||||||
Common stock issued for services (in shares) | 246,637 | 324,675 | |||||||||||||
Common stock issued for services | $ 1,000 | ||||||||||||||
Amended and Restated Warrants [Member] | |||||||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||||||
Debt instrument exercise price | $ 0.446 | $ 0.446 | $ 0.446 | ||||||||||||
Number of common stock to be purchased | 4,038,200 | ||||||||||||||
Kainos Medicine, Inc [Member] | |||||||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||||||
Payments to research and development expense | $ 500,000 | ||||||||||||||
Common stock shares issued for consideration | 324,675 | ||||||||||||||
Addition to equity for common stock | $ 500,000 | ||||||||||||||
Research and development | $ 0 | 1,000,000 | |||||||||||||
Stock Options [Member] | |||||||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||||||
Vesting period remaining for recognition of unrecognized share-based compensation expense | 8 months 12 days | ||||||||||||||
Restricted Stock [Member] | Professional Relations and Consulting Service [Member] | Common Stock [Member] | |||||||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||||||
Common stock issued for services (in shares) | 246,637 | ||||||||||||||
Common stock issued for services | $ 110,000 | ||||||||||||||
2021 Stock Incentive Option Plan [Member] | |||||||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||||||
Unrecognized share-based compensation expense | 8,000 | $ 8,000 | |||||||||||||
2021 Stock Incentive Option Plan [Member] | Stock Options [Member] | |||||||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||||||
Share-based compensation | $ 3,000 | $ 93,000 | $ 13,000 | $ 548,000 | |||||||||||
Convertible Promissory Note [Member] | |||||||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||||||
Number outstanding | 1,250,000 | 1,250,000 | |||||||||||||
Convertible Promissory Note [Member] | Securities Purchase Agreement [Member] | |||||||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||||||
Convertible notes principal amount | $ 3,150,000 | ||||||||||||||
Extended maturity date | Jun. 15, 2023 | ||||||||||||||
Percentage of monthly payments interest rate | 12% | 2% | 11% | ||||||||||||
Debt instrument exercise price | $ 2.05 | ||||||||||||||
Expected life (in years) | 5 years | ||||||||||||||
Number outstanding | 1,250,000 | ||||||||||||||
Outstanding shares repayment | 500,000 | ||||||||||||||
Repayment of debt | $ 0 |
STOCKHOLDERS' DEFICIT (Details)
STOCKHOLDERS' DEFICIT (Details) - Convertible Promissory Note [Member] - Liability Instrument - Warrants [Member] - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 15, 2022 | Dec. 31, 2021 | |
Class Of Warrant Or Right [Line Items] | ||
Balance, beginning of period | $ 1,463 | $ 988 |
Change in fair value included in the statement of operations | (1,250) | 475 |
Reclassification to equity | $ (213) | |
Balance, end of period | $ 1,463 |
STOCKHOLDERS' DEFICIT (Detail_2
STOCKHOLDERS' DEFICIT (Details 1) | Sep. 30, 2022 $ / shares | Jun. 15, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares |
Class Of Warrant Or Right [Line Items] | |||
Debt instrument exercise price | $ 2.50 | ||
Convertible Promissory Note [Member] | |||
Class Of Warrant Or Right [Line Items] | |||
Stock price | $ 0.36 | $ 1.67 | |
Number outstanding | shares | 1,250,000 | 1,250,000 | |
Measurement Input, Exercise Price [Member] | Convertible Promissory Note [Member] | |||
Class Of Warrant Or Right [Line Items] | |||
Debt instrument exercise price | $ 2.05 | $ 2.05 | |
Risk-free Interest Rate (South Korea government bond) [Member] | Convertible Promissory Note [Member] | |||
Class Of Warrant Or Right [Line Items] | |||
Warrants and rights outstanding, measurement input | 3.35 | 1.04 | |
Expected Volatility (Telcon common stock) [Member] | Convertible Promissory Note [Member] | |||
Class Of Warrant Or Right [Line Items] | |||
Warrants and rights outstanding, measurement input | 126 | 117 | |
Expected Life (in years) [Member] | Convertible Promissory Note [Member] | |||
Class Of Warrant Or Right [Line Items] | |||
Expected life (in years) | 3 years | 3 years 5 months 15 days |
STOCKHOLDERS' DEFICIT (Detail_3
STOCKHOLDERS' DEFICIT (Details 2) - Convertible Promissory Note [Member] - Warrant [Member] - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Class Of Warrant Or Right [Line Items] | ||
Warrants outstanding, beginning | 8,236,017 | 8,439,480 |
Granted | 500,000 | |
Cancelled, forfeited or expired | (2,125,497) | (203,463) |
Warrants outstanding, ending | 6,610,520 | 8,236,017 |
Warrants exercisable ending | 6,610,520 | 7,486,017 |
Weighted Average Exercise Price, Outstanding | $ 5.78 | $ 6.09 |
Granted | 2.50 | |
Cancelled, forfeited or expired | 14.38 | 4.36 |
Weighted Average Exercise Price, Outstanding | 2.88 | 5.78 |
Weighted Average Exercise Price, Exercisable | $ 2.88 | $ 6.12 |
STOCKHOLDERS' DEFICIT (Detail_4
STOCKHOLDERS' DEFICIT (Details 3) - 2011 Stock Incentive Option Plan [Member] - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Class Of Warrant Or Right [Line Items] | ||
Number of Options outstanding, beginning | 5,968,338 | 7,110,025 |
Number of Options, Cancelled, forfeited and expired | (1,055,399) | (1,141,687) |
Number of Options outstanding, end | 4,912,939 | 5,968,338 |
Number of Options, Options exercisable | 4,894,938 | 5,937,837 |
Number of Options, Options available for future grant | 4,000,000 | 4,000,000 |
Weighted-Average Exercise Price, Options outstanding, beginning | $ 4.78 | $ 4.63 |
Weighted-Average Exercise Price, Cancelled, forfeited and expired | 3.45 | 3.82 |
Weighted-Average Exercise Price, Options outstanding, end | 5.07 | 4.78 |
Weighted-Average Exercise Price, Options exercisable | $ 5.09 | $ 4.80 |
INCOME TAX (Details Narrative)
INCOME TAX (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Income tax benefit | $ (35,000) | $ 232,000 | $ 44,000 | $ 58,000 |
Unrecognized tax benefits | $ 0 | $ 0 | 0 | $ 0 |
Federal income tax provision | $ 0 |
LEASES (Details Narrative)
LEASES (Details Narrative) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 USD ($) ft² | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) ft² | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Leases [Line Items] | |||||
Gain (loss) on termination of lease | $ 31,000 | ||||
Rent expense | $ 272,000 | $ 300,000 | 868,000 | $ 889,000 | |
Right of use assets | 2,944,000 | 2,944,000 | $ 3,485,000 | ||
Operating lease liabilities | $ 3,416,000 | $ 3,416,000 | |||
Weighted average remaining term of leases | 4 years | 4 years | |||
Weighted average discount rate | 12.90% | 12.90% | |||
Torrance, California [Member] | |||||
Leases [Line Items] | |||||
Operating lease, lease space | ft² | 21,293 | 21,293 | |||
Operating lease, base rental per month | $ 80,886 | ||||
Operating lease, expiration date | Sep. 30, 2026 | ||||
Dubai, United Arb Emirates [Member] | |||||
Leases [Line Items] | |||||
Operating lease, lease space | ft² | 1,163 | 1,163 | |||
Operating lease, expiration date | Jun. 19, 2023 |
LEASES (Details)
LEASES (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Leases [Abstract] | |
2022 (three months) | $ 263 |
2023 | 1,049 |
2024 | 1,063 |
2025 | 1,092 |
2026 | 836 |
Total lease payments | 4,303 |
Less: Interest | 887 |
Present value of lease liabilities | $ 3,416 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - Telcon RF Pharmaceuticals, Inc. ("Telcon") [Member] $ in Millions | Jul. 12, 2017 USD ($) Number | Jun. 12, 2017 USD ($) |
API Supply Agreement [Member] | ||
Proceeds from supply agreement | $ 31.8 | |
API Supply Agreement [Member] | PGLG [Member] | ||
Percentage of right to supply | 25% | |
Agreement term | 15 years | |
Revised API Agreement [Member] | ||
Agreement term | 5 years | |
Number of renewals | Number | 10 | |
Cumulative purchase amount | $ 47 | |
Annual purchase target amount | 5 | |
Target profit | $ 2.5 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | ||
Short-term Debt [Line Items] | |||
Principal Amount Outstanding | $ 26,143 | $ 18,007 | |
Willis Lee [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 12% | 12% |
Date of Loan | [1] | Oct. 29, 2020 | Oct. 29, 2020 |
Term of Loan | [1] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [1] | $ 100 | $ 100 |
Highest Principal Outstanding | [1] | $ 100 | $ 100 |
Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 12% | 12% |
Date of Loan | [2] | Dec. 07, 2021 | Jan. 20, 2021 |
Term of Loan | [2] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [2] | $ 700 | |
Highest Principal Outstanding | [2] | $ 700 | $ 700 |
Amount of Principal Repaid | [2] | 700 | |
Amount of Interest Paid | [2] | $ 13 | |
Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 12% | 12% |
Date of Loan | [2] | Jan. 18, 2022 | Sep. 15, 2021 |
Term of Loan | [2] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [2] | $ 300 | |
Highest Principal Outstanding | [2] | $ 300 | $ 300 |
Amount of Principal Repaid | [2] | 300 | |
Amount of Interest Paid | [2] | $ 3 | |
Yasushi Nagasaki [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 10% | |
Date of Loan | [1] | Feb. 09, 2022 | |
Term of Loan | [1] | Due on Demand | |
Principal Amount Outstanding | [1] | $ 50 | |
Highest Principal Outstanding | [1] | $ 50 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Feb. 09, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 350 | |
Highest Principal Outstanding | [2] | $ 350 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Feb. 15, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 210 | |
Highest Principal Outstanding | [2] | $ 210 | |
Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | 12% |
Date of Loan | [2] | Feb. 15, 2022 | Dec. 07, 2021 |
Term of Loan | [2] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [2] | $ 100 | $ 700 |
Highest Principal Outstanding | [2] | $ 100 | 700 |
George Sekulich [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 10% | |
Date of Loan | [1] | Feb. 16, 2022 | |
Term of Loan | [1] | Due on Demand | |
Principal Amount Outstanding | [1] | $ 26 | |
Highest Principal Outstanding | [1] | 26 | |
Promissory note payable and Revolving line of credit [Member] | |||
Short-term Debt [Line Items] | |||
Principal Amount Outstanding | 6,702 | 1,200 | |
Highest Principal Outstanding | 6,702 | 2,600 | |
Amount of Principal Repaid | 1,400 | ||
Amount of Interest Paid | $ 40 | 51 | |
Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Mar. 07, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 200 | |
Highest Principal Outstanding | [2] | $ 200 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 12% | |
Date of Loan | [2] | Mar. 15, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 150 | |
Highest Principal Outstanding | [2] | $ 150 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 12% | |
Date of Loan | [2] | Mar. 30, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 150 | |
Highest Principal Outstanding | [2] | $ 150 | |
Wei Pei Derek Zen [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 10% | |
Date of Loan | [1] | Mar. 31, 2022 | |
Term of Loan | [1] | Due on Demand | |
Principal Amount Outstanding | [1] | $ 200 | |
Highest Principal Outstanding | [1] | $ 200 | |
Willis Lee [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 10% | |
Date of Loan | [1] | Apr. 14, 2022 | |
Term of Loan | [1] | Due on Demand | |
Principal Amount Outstanding | [1] | $ 45 | |
Highest Principal Outstanding | [1] | $ 45 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | May 25, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 40 | |
Highest Principal Outstanding | [2] | $ 40 | |
Yutaka And Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 12% | |
Date of Loan | [2] | Jul. 27, 2022 | |
Term of Loan | [2] | 5 years | |
Principal Amount Outstanding | [2] | $ 402 | |
Highest Principal Outstanding | [2] | 402 | |
Amount of Interest Paid | [2] | $ 8 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Aug. 15, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 50 | |
Highest Principal Outstanding | [2] | $ 50 | |
Yutaka And Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Aug. 16, 2022 | |
Term of Loan | [2] | 5 years | |
Principal Amount Outstanding | [2] | $ 250 | |
Highest Principal Outstanding | [2] | 250 | |
Amount of Interest Paid | [2] | $ 2 | |
Yutaka And Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Aug. 16, 2022 | |
Term of Loan | [2] | 5 years | |
Principal Amount Outstanding | [2] | $ 1,669 | |
Highest Principal Outstanding | [2] | 1,669 | |
Amount of Interest Paid | [2] | $ 14 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Aug. 17, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 50 | |
Highest Principal Outstanding | [2] | $ 50 | |
Yutaka And Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Aug. 17, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 60 | |
Highest Principal Outstanding | [2] | $ 60 | |
Seah Lim [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 6% | |
Date of Loan | [1] | Sep. 16, 2022 | |
Term of Loan | [1] | 3 years | |
Principal Amount Outstanding | [1] | $ 1,200 | |
Highest Principal Outstanding | [1] | $ 1,200 | |
Promissory note payable to related parties [Member] | |||
Short-term Debt [Line Items] | |||
Term of Loan | Subtotal | ||
Principal Amount Outstanding | $ 6,302 | 800 | |
Highest Principal Outstanding | 6,302 | 1,800 | |
Amount of Principal Repaid | 1,000 | ||
Amount of Interest Paid | $ 24 | $ 16 | |
Yutaka Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [3] | 5.25% | 5.25% |
Date of Loan | [3] | Dec. 27, 2019 | Dec. 27, 2019 |
Term of Loan | [3] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [3] | $ 400 | $ 400 |
Highest Principal Outstanding | [3] | 400 | 800 |
Amount of Principal Repaid | [3] | 400 | |
Amount of Interest Paid | [3] | 16 | 35 |
Revolving Line of Credit Facility [Member] | |||
Short-term Debt [Line Items] | |||
Principal Amount Outstanding | 400 | 400 | |
Highest Principal Outstanding | 400 | 800 | |
Amount of Principal Repaid | 400 | ||
Amount of Interest Paid | $ 16 | $ 35 | |
[1]Officer or director.[2]Dr. Niihara, a Director and the Chairman, and Chief Executive Officer of the Company, is also a director and the Chief Executive Officer of Hope International Hospice, Inc.[3]The rate varies with changes in the prime rate and does not give effect to the “tax gross-up” described in Note 7. |
RELATED PARTY TRANSACTIONS (D_2
RELATED PARTY TRANSACTIONS (Details Narrative) - Telcon, Inc. ("Telcon") [Member] $ in Millions | Sep. 30, 2022 USD ($) shares |
Related Party Transaction [Line Items] | |
Marketable securities common stock outstanding | shares | 4,147,491 |
Percentage of marketable securities common stock outstanding | 8.40% |
Convertible notes payable, carrying amount | $ | $ 18.4 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) | 1 Months Ended |
Oct. 31, 2022 USD ($) | |
Subsequent Event [Member] | |
Subsequent Event [Line Items] | |
Redemption of principal amount of outstanding convertible promissory notes | $ 175,000 |