Document_And_Entity_Informatio
Document And Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Oct. 20, 2014 | |
Document Information [Line Items] | ' | ' |
Entity Registrant Name | 'AmpliPhi Biosciences Corp | ' |
Entity Central Index Key | '0000921114 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Trading Symbol | 'APHB | ' |
Entity Common Stock, Shares Outstanding | ' | 187,159,093 |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-14 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Document Fiscal Year Focus | '2014 | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Current assets | ' | ' |
Cash and cash equivalents | $9,786,000 | $20,355,000 |
Accounts receivable | 27,000 | 8,000 |
Prepaid expenses and other current assets | 279,000 | 171,000 |
Total current assets | 10,092,000 | 20,534,000 |
Property and equipment, net of accumulated depreciation of $559,000 and $473,000 as of September 30, 2014 and December 31, 2013, respectively | 1,175,000 | 145,000 |
Intangible assets | ' | ' |
In process research and development | 12,446,000 | 12,446,000 |
Patents, net of accumulated amortization of $116,000 and $93,000 as of September 30, 2014 and December 31, 2013, respectively | 377,000 | 400,000 |
Goodwill | 4,329,000 | 4,329,000 |
Total intangible assets | 17,152,000 | 17,175,000 |
Total assets | 28,419,000 | 37,854,000 |
Current liabilities | ' | ' |
Accounts payable and accrued expenses | 1,840,000 | 2,147,000 |
Accrued severance | 659,000 | 0 |
Total current liabilities | 2,499,000 | 2,147,000 |
Long term liabilities | ' | ' |
Derivative preferred shares conversion liability | 7,633,000 | 34,443,000 |
Derivative warrants liability | 6,949,000 | 16,664,000 |
Total long term liabilities | 14,582,000 | 51,107,000 |
Total liabilities | 17,081,000 | 53,254,000 |
Stockholders' equity (deficit) | ' | ' |
Preferred stock, $0.01 par value, 10,000,000 shares authorized; 8,671,040 shares issued and outstanding at September 30, 2014 and 8,859,978 shares issued and outstanding at December 31, 2013 | 87,000 | 89,000 |
Common stock, $0.01 par value, 445,000,000 shares authorized, 187,159,093 shares issued and outstanding at September 30, 2014 and 182,535,562 shares issued and outstanding at December 31, 2013 | 1,872,000 | 1,825,000 |
Additional paid-in capital | 363,032,000 | 358,988,000 |
Paid-in-capital - contingent shares | 1,837,000 | 1,837,000 |
Accumulated other comprehensive loss | -178,000 | -65,000 |
Accumulated deficit | -355,312,000 | -378,074,000 |
Total stockholders' equity (deficit) | 11,338,000 | -15,400,000 |
Total liabilities and stockholders' equity (deficit) | $28,419,000 | $37,854,000 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS [Parenthetical] (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment (in dollars) | $559,000 | $473,000 |
Preferred stock, par value (in dollars per share) | $0.01 | $0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 8,671,040 | 8,859,978 |
Preferred stock, shares outstanding | 8,671,040 | 8,859,978 |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized | 445,000,000 | 445,000,000 |
Common stock, shares issued | 187,159,093 | 182,535,562 |
Common stock, shares outstanding | 187,159,093 | 182,535,562 |
Patents [Member] | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | $116,000 | $93,000 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Revenue | $0 | ($3,000) | $310,000 | $333,000 |
Operating expenses | ' | ' | ' | ' |
Research and development | 1,804,000 | 1,106,000 | 4,687,000 | 5,378,000 |
General and administrative | 1,632,000 | 1,211,000 | 5,377,000 | 4,777,000 |
Severance charge | 1,510,000 | 0 | 1,510,000 | 0 |
Total operating expenses | 4,946,000 | 2,317,000 | 11,574,000 | 10,155,000 |
Loss from operations | -4,946,000 | -2,320,000 | -11,264,000 | -9,822,000 |
Other income (expense) | ' | ' | ' | ' |
Gain (loss) on derivative liabilities | 24,334,000 | -41,548,000 | 34,026,000 | -45,617,000 |
Amortization of note discount and patents | 0 | -23,000 | 0 | -2,660,000 |
Interest expense, net | 0 | -9,000 | 0 | -233,000 |
Other income (expense), net | 24,334,000 | -41,580,000 | 34,026,000 | -48,510,000 |
Net income (loss) | 19,388,000 | -43,900,000 | 22,762,000 | -58,332,000 |
Other comprehensive income (loss) | ' | ' | ' | ' |
Net unrealized gain (loss) on foreign currency translations | -93,000 | -21,000 | -113,000 | -24,000 |
Comprehensive income (loss) | $19,295,000 | ($43,921,000) | $22,649,000 | ($58,356,000) |
Net income (loss) per share - basic (in dollars per share) | $0.10 | ($0.44) | $0.12 | ($0.68) |
Weighted average number of shares of common stock outstanding - basic (in shares) | 187,159,093 | 99,156,809 | 184,445,172 | 85,688,356 |
Net income (loss) per share - diluted (in dollars per share) | $0.06 | ($0.44) | $0.07 | ($0.68) |
Weighted average number of shares of common stock outstanding - diluted (in shares) | 315,990,084 | 99,156,809 | 323,604,642 | 85,688,356 |
CONSOLIDATED_STATEMENTS_OF_STO
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) (USD $) | Total | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
Balances at Dec. 31, 2012 | $12,943,000 | $0 | $669,000 | $332,806,000 | ($320,426,000) | ($106,000) |
Balances (in shares) at Dec. 31, 2012 | ' | 0 | 66,908,810 | ' | ' | ' |
Net income (loss) | -57,648,000 | 0 | 0 | 0 | -57,648,000 | 0 |
Beneficial conversion feature and warrants associated with issuance of convertible loan notes | 2,635,000 | 0 | 0 | 2,635,000 | 0 | 0 |
Shares issued for Intrexon | 3,000,000 | 0 | 240,000 | 2,760,000 | 0 | 0 |
Shares issued for Intrexon (in shares) | ' | ' | 24,000,000 | ' | ' | ' |
Issuance of preferred stock from conversion of convertible loan notes | 50,000 | 50,000 | 0 | 0 | 0 | 0 |
Issuance of preferred stock from conversion of convertible loan notes (in shares) | ' | 5,016,081 | 0 | ' | ' | ' |
Issuance of preferred stock | 50,000 | 50,000 | 0 | 0 | 0 | 0 |
Issuance of preferred stock (in shares) | ' | 4,999,999 | ' | ' | ' | ' |
Preferred stock converted to common stock | 6,615,000 | -11,000 | 115,000 | 6,511,000 | 0 | 0 |
Preferred stock converted to common stock (in shares) | ' | -1,156,102 | 11,561,020 | ' | ' | ' |
Stock-based compensation | 1,437,000 | 0 | 0 | 1,437,000 | 0 | 0 |
Stock options exercised | 13,000 | 0 | 1,000 | 12,000 | 0 | 0 |
Stock options exercised (in shares) | ' | ' | 61,018 | ' | ' | ' |
Shares released from escrow | 0 | 0 | 80,000 | -80,000 | 0 | 0 |
Shares released from escrow (in shares) | ' | ' | 8,000,000 | ' | ' | ' |
Issuance of common stock for December financing | 15,464,000 | 0 | 720,000 | 14,744,000 | 0 | 0 |
Issuance of common stock for December financing (in shares) | ' | ' | 72,007,000 | ' | ' | ' |
Escheat shares | 0 | 0 | 0 | 0 | 0 | 0 |
Escheat shares (in shares) | ' | ' | -2,286 | ' | ' | ' |
Foreign currency translations | 41,000 | 0 | 0 | 0 | 0 | 41,000 |
Balances at Dec. 31, 2013 | -15,400,000 | 89,000 | 1,825,000 | 360,825,000 | -378,074,000 | -65,000 |
Balances (in shares) at Dec. 31, 2013 | ' | 8,859,978 | 182,535,562 | ' | ' | ' |
Net income (loss) | 22,762,000 | 0 | 0 | 0 | 22,762,000 | 0 |
Warrants exercised | 1,758,000 | 0 | 28,000 | 1,730,000 | 0 | 0 |
Warrants exercised (in shares) | ' | ' | 2,734,151 | ' | ' | ' |
Preferred stock converted to common stock | 741,000 | -2,000 | 19,000 | 724,000 | 0 | 0 |
Preferred stock converted to common stock (in shares) | ' | -188,938 | 1,889,380 | ' | ' | ' |
Stock-based compensation | 759,000 | 0 | 0 | 759,000 | 0 | 0 |
Stock-based compensation - severance | 831,000 | 0 | 0 | 831,000 | 0 | 0 |
Foreign currency translations | -113,000 | 0 | 0 | 0 | 0 | -113,000 |
Balances at Sep. 30, 2014 | $11,338,000 | $87,000 | $1,872,000 | $364,869,000 | ($355,312,000) | ($178,000) |
Balances (in shares) at Sep. 30, 2014 | ' | 8,671,040 | 187,159,093 | ' | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Cash flows from operating activities | ' | ' |
Net income (loss) from operations | $22,762,000 | ($58,332,000) |
Adjustments required to reconcile net income (loss) to cash used in operating activities: | ' | ' |
Derivative liability (gain) loss | -34,026,000 | 45,617,000 |
Shares issued for technology access fee | 0 | 3,000,000 |
Amortization of patents | 23,000 | 23,000 |
Amortization of note discount | 0 | 2,637,000 |
Warrants issued as investment fees | 0 | 759,000 |
Depreciation | 59,000 | 66,000 |
Stock-based compensation | 759,000 | 1,206,000 |
Stock-based compensation - severance | 831,000 | 0 |
Changes in operating assets and liabilities net of acquisitions: | ' | ' |
Accounts receivable | -19,000 | -125,000 |
Tax refund | 0 | 618,000 |
Accounts payable and accrued expenses | -307,000 | -453,000 |
Accrued severance | 659,000 | 0 |
Prepaid expenses and other current assets | -108,000 | -153,000 |
Interest on loan notes | 0 | 233,000 |
Net cash used in operating activities | -9,367,000 | -4,904,000 |
Cash flows from investing activities | ' | ' |
Purchases of property and equipment | -1,089,000 | -97,000 |
Net cash used in investing activities | -1,089,000 | -97,000 |
Cash flows from financing activities | ' | ' |
Proceeds from Preferred Series B | 0 | 7,000,000 |
Proceeds from convertible loan notes | 0 | 2,000,000 |
Payment of convertible loan note | 0 | -26,000 |
Net cash provided by financing activities | 0 | 8,974,000 |
Effect of exchange rates | -113,000 | 24,000 |
Net increase (decrease) in cash and cash equivalents | -10,569,000 | 3,997,000 |
Cash and cash equivalents, beginning of period | 20,355,000 | 862,000 |
Cash and cash equivalents, end of period | $9,786,000 | $4,859,000 |
Nature_of_Business_and_Signifi
Nature of Business and Significant Accounting Policies | 9 Months Ended | ||
Sep. 30, 2014 | |||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ||
Business Description and Accounting Policies [Text Block] | ' | ||
1. Nature of Business and Significant Accounting Policies | |||
Nature of Business | |||
AmpliPhi Biosciences Corporation (the “Company”) was incorporated in the state of Washington in 1989. The Company, headquartered in Richmond, Virginia, is dedicated to developing novel antibacterial solutions called bacteriophage (phage). Phages are naturally occurring viruses that preferentially target and kill their bacterial targets. | |||
Basis of Presentation | |||
The interim consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries - Biocontrol, Ampliphi d.o.o., and AmpliPhi Australia. All significant intercompany accounts and transactions have been eliminated. All amounts on the financial statements and disclosures have been rounded to the nearest $1,000 except share and per share data. | |||
The interim consolidated financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission, or SEC. In the opinion of the Company’s management, all adjustments (consisting of normal recurring adjustments, reclassifications, and non-recurring adjustments) necessary to present fairly our results of operations for the three months and nine months ended September 30, 2014 and 2013, our cash flows for the nine months ended September 30, 2014 and 2013 and our financial position as of September 30, 2014 have been made. The results of operations for such interim periods are not necessarily indicative of the operating results to be expected for the full year. | |||
Certain information and disclosures normally included in the notes to the annual financial statements have been condensed or omitted from these interim consolidated financial statements. Accordingly, these interim consolidated financial statements should be read in conjunction with the 2013 audited consolidated financial statements and notes. | |||
Use of Estimates | |||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | |||
Cash and Cash Equivalents | |||
The Company considers cash equivalents to be short-term investments that have a maturity at the time of purchase of three months or less, are readily convertible into cash and have an insignificant level of valuation risk attributable to potential changes in interest rates. Cash equivalents are recorded at cost, which approximates fair market value, and consist primarily of money market accounts. | |||
Accounts Receivable | |||
Accounts receivable amounts are stated at their face amounts less any allowance. Provisions for doubtful accounts are estimated based on assessment of the probable collection from specific customer accounts and other known factors. If an account was determined to be uncollectible (payment has not been made in accordance with contract terms), it would be written off against the allowance. As of September 30, 2014 and December 31, 2013, management determined no allowance for doubtful accounts was required. | |||
Property and Equipment | |||
Property and equipment are recorded at cost and are depreciated using the straight-line method over the estimated useful lives of the related assets, generally three to seven years. | |||
Prepaid Expenses and Other Current Assets | |||
Prepaid and other current assets as of September 30, 2014 and December 31, 2013 consist primarily of prepaid insurance and deposits. | |||
Goodwill | |||
Investments in purchased companies in excess of the underlying fair value of net assets at the date of acquisition are recorded as goodwill and assessed annually for impairment. If considered impaired, goodwill will be written down to fair value and a corresponding impairment loss recognized. | |||
In 2012, the rights to SPH Holdings Pty Ltd’s know-how and phage libraries were acquired in a business combination with an aggregate value of $7,172,000. Goodwill in the amount of $2,381,000 was recorded. In management’s opinion, no goodwill has been impaired as of September 30, 2014 and December 31, 2013. | |||
In 2011, the rights to Biocontrol Limited’s patents and phage libraries were acquired in a business combination with an aggregate value of $8,584,000. Goodwill in the amount of $1,948,000 was recorded. In management’s opinion, no goodwill has been impaired as of September 30, 2014 and December 31, 2013. | |||
Patents | |||
Patents are recorded at cost and are amortized using the straight-line method over the estimated useful lives of the patents. | |||
In 2011, the rights to Biocontrol Limited’s patents were acquired in a business combination. Patents in the amount of $493,000 have been recorded. These patents are being amortized over their useful life through December 2026. | |||
Stock-Based Compensation | |||
The Company accounts for stock-based payments under the guidance of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 718, Stock Compensation, which requires measurement of compensation cost for all share-based payment awards at fair value on the date of grant and recognition of compensation cost over the requisite service period (typically the vesting period) for awards expected to vest. | |||
Warrant and Preferred Shares Conversion Feature Liability | |||
The Company accounts for warrants and the preferred shares conversion feature of the Company’s Series B preferred stock with anti-dilution (“down-round”) provisions under the guidance of ASC 815, Derivatives, and Hedging and Emerging Issue Task Force Statement 07-5: Determining Whether an Instrument (or Embedded Feature) Is Indexed to an Entity’s Own Stock, which require such warrants and the Series B preferred shares conversion feature to be recorded as a liability and adjusted to fair value in each reporting period. | |||
Fair Value of Financial Assets and Liabilities — Derivative Instruments | |||
The Company measures the fair value of financial assets and liabilities in accordance with GAAP, which defines fair value, establishes a framework for measuring fair value, and requires certain disclosures about fair value measurements. | |||
GAAP defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. GAAP also establishes as fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. GAAP describes three levels of inputs that may be used to measure fair value: | |||
Level 1 — quoted prices in active markets for identical assets or liabilities. | |||
Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable. | |||
Level 3 — inputs that are unobservable. | |||
The Company does not use derivative financial instruments to hedge exposures to cash-flow, market or foreign-currency risks. However, the Company has entered into certain financial instruments and contracts, such as convertible loan notes with detachable common stock warrants and the issuance of preferred stock with detachable common stock warrants with features that are either i) not afforded equity classification, ii) embody risks not clearly and closely related to host contracts, or iii) may be net-cash settled by the counterparty. These instruments are required to be carried as derivative liabilities, at fair value. | |||
The Company estimates fair values of these derivatives utilizing Level 2 inputs. The Company uses the Monte Carlo valuation technique as it embodies all of the requisite assumptions (including trading volatility, remaining term to maturity, market price, strike price, and risk free rates) necessary to fair value these instruments. | |||
Estimating fair values of derivative financial instruments, including Level 2 instruments, require the use of significant and subjective inputs that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques are volatile and sensitive to changes in our trading market price, the trading market price of various peer companies and other key assumptions. Since derivative financial instruments are initially and subsequently carried at fair value, our income will reflect this sensitivity of internal and external factors. | |||
Revenue Recognition | |||
The Company generates revenue from technology licenses. Revenue under technology licenses typically consists of nonrefundable, up-front license fees, technology access fees and various other payments. The Company recognizes revenue associated with performance milestones as earned, typically based upon the achievement of the specific milestones defined in the applicable agreements. | |||
The Company recognizes revenue under research and development contracts as the related costs are incurred. When contracts include multiple elements, the Company follows ASC 605-25, Multiple Element Arrangements, which requires the Company to satisfy the following before revenue can be recognized: | |||
• | The delivered items have value to the customer on a stand-alone basis; | ||
• | Any undelivered items have objective and reliable evidence of fair value; and | ||
• | Delivery or performance is probable and within the Company’s control for any delivered items that have a right of return. | ||
The Company classifies advance payments received in excess of amounts earned as deferred revenue. | |||
Based upon the terms specified in its collaboration agreements, the Company receives advance payments from some of its collaboration partners before the project has been performed. These payments are deferred and recognized as revenue when the costs are incurred. | |||
Research and Development | |||
Research and development costs include salaries, costs of outside collaborators and outside services, royalty and license costs and allocated facility, occupancy and utility expenses. The Company expenses research and development costs as incurred. | |||
In Process Research & Development (IPR&D) assets represent capitalized incomplete research projects that the Company acquired through business combinations. Such assets are initially measured at their acquisition date fair values. The fair value of the research projects is recorded as intangible assets on the consolidated balance sheet rather than expensed regardless of whether these assets have an alternative future use. The amounts capitalized are being accounted for as indefinite-lived intangible assets, subject to impairment testing until completion or abandonment of research and development efforts associated with the projects. Upon successful completion of each project, the Company will make a determination as to the then remaining useful life of the intangible asset and begin amortization. The Company tests its indefinite-lived intangibles, including IPR&D assets, for impairment at least annually. In 2012, the rights to SPH Holdings Pty Ltd’s know-how and phage libraries were acquired by a business combination for $7,172,000. In 2012, IPR&D in the amount of $5,161,000 was recorded. In management’s opinion, this IPR&D has not been impaired as of September 30, 2014 and December 31, 2013. | |||
In 2011, the rights to Biocontrol Limited’s patents and phage libraries were acquired by a business combination $8,584,000. In 2011, IPR&D in the amount of $7,285,000 was recorded. In management’s opinion, this IPR&D has not been impaired as of September 30, 2014 and December 31, 2013. | |||
Net Income (Loss) per Common Share | |||
Net income (loss) per common share is based on net income (loss) divided by the weighted average number of common shares outstanding during the period. For the three months ended September 30, 2014 and the nine months ended September 30, 2014, both basic and diluted net income (loss) are disclosed in the Consolidated Statements of Operations and Comprehensive Income. For the three months ended September 30, 2013 and the nine months ended September 30, 2013, the diluted net loss per share is the same as the basic net loss per share because all stock options, warrants, contingent shares, and Series B Preferred shares were antidilutive with respect to computing the net loss per share and therefore were excluded from the calculation of diluted net loss per share. The total number of shares that the Company excluded from the calculations of net loss per share was 150,283,630 shares for the three month period ending September 30, 2013 and 63,155,331 shares for the nine month period ending September 30, 2013. | |||
Recent Accounting Pronouncements | |||
On February 5, 2013, the FASB issued ASU no. 2013-02 which adds new disclosure requirements for items reclassified out of accumulated other comprehensive income (AOCI). The ASU is intended to help entities improve the transparency of changes in other comprehensive income (OCI) and items reclassified out of AOCI in their financial statements. It does not amend any existing requirements for reporting net income or OCI in the financial statements. For public entities, the new disclosure requirements are effective for fiscal years, and interim periods within those years, beginning after December 15, 2012. For nonpublic entities, the ASU is effective for fiscal years beginning after December 15, 2013, and interim and annual periods thereafter. The Company elected to early adopt this standard which did not result in any changes to the consolidated financial statements. | |||
Liquidity
Liquidity | 9 Months Ended |
Sep. 30, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Liquidation Basis of Accounting [Text Block] | ' |
2. Liquidity | |
The Company has prepared the accompanying consolidated financial statements on a going concern basis, which assumes that the Company will realize its assets and satisfy its liabilities in the normal course of business. However, the Company has incurred net losses since its inception, has negative operating cash flows and has an accumulated deficit of $355.3 million as of September 30, 2014. These circumstances raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the outcome of the uncertainty concerning the Company’s ability to continue as a going concern. | |
The Company believes that its current resources will only be sufficient to fund operations through the first quarter of 2015. This estimate is based on the Company’s ability to manage its staffing expenses and its working capital. Actual results could differ from its estimates. The Company intends to seek additional financing in order to fund operations through 2015; however, the Company cannot provide assurances that it will be successful in obtaining additional financing for these periods or as needed in the future. If the Company does not raise additional funds by the first quarter of 2015, it plans to implement cost reduction measures, such as a reduction in workforce, reducing its intellectual property prosecution, reducing other operating activities, and/or the pursuit of alternative financing transactions that would likely be on terms disadvantageous to the Company and dilutive to its shareholders. The Company could also be required to relinquish rights to its technology or product candidates or in-licensed technology on unfavorable terms, either of which would reduce the ultimate value of the technology or product candidates, or to sell assets likely at values significantly below their potential worth. If the Company is unable to secure additional capital, it may be required to cease operations, declare bankruptcy or otherwise wind-up its business. | |
Preferred_Shares
Preferred Shares | 9 Months Ended |
Sep. 30, 2014 | |
Equity [Abstract] | ' |
Preferred Stock [Text Block] | ' |
3. Preferred Shares | |
On June 13, 2013, the Company’s Board of Directors approved a resolution designating 10,016,080 shares of Preferred Stock as Series B Convertible Preferred Stock with an initial stated value of $1.40 and par value of $0.01. Each Series B preferred share is convertible into 10 shares of common stock and is entitled to the number of votes equal to the number of shares of common stock. These Series B shares may be converted to common stock by the holder of the shares at any time. The Series B shares shall be automatically converted into common shares upon the closing of an underwritten initial public offering with aggregate proceeds to the Company of at least $7 million and a price per share to the public of at least the Series B stated value upon the closing of which the shares of common stock of the Company shall be listed for trading on the New York Stock Exchange. The Series B shares are also convertible into common shares upon the election of the holders of two-thirds of the outstanding Series B shares. Until conversion, the holders of Series B Preferred shares shall be entitled to receive dividends of 10% of the Series B stated value per annum. | |
In connection with the private placement of Series B Convertible Preferred Stock, the Company recorded a liability for a complex embedded derivative that required bifurcation under ASC Section 815. The embedded derivative includes a redemption feature, multiple dividend features, as well as multiple conversion features with a down-round ratchet provision. The Company estimates the fair values of the conversion feature using a Monte Carlo valuation model. The Company measured the fair value of the conversion feature on June 26, 2013 and July 15, 2013(dates of issuance) and recorded the initial liability as part of the private placement proceeds. | |
On June 26, 2013, the Company issued 4,999,999 shares of the Company’s newly-created Series B Convertible Preferred Stock and warrants to purchase 12,499,996 shares of common stock at an exercise price of $0.14 per share for an aggregate purchase price of $7.0 million. The value of the derivative liability related to the warrants was $1,886,000 and the value of the derivative liability related to the preferred shares was $5,064,000. As part of the same transaction, the Company converted $5,491,001 in outstanding convertible loan notes (principal and interest) into 4,357,936 shares of Series B Convertible Preferred Stock and warrants to purchase 10,894,839 shares of common stock at an exercise price of $0.14 per share. The value of the derivative liability related to the warrants was $1,644,000 and the value of the derivative liability related to the preferred shares was $3,804,000. As part of this issuance, the Company issued warrants to purchase 4,999,999 shares of common stock at an exercise price of $0.14 per share with an initial fair value of $759,000 and paid $350,000 to the placement agents. As a result of this financing, all outstanding convertible notes were converted into shares of Series B Convertible Preferred Stock and warrants to purchase common stock. On July 15, 2013, the remaining outstanding convertible loan notes, totaling $829,277 in principal and interest, were converted into 658,145 shares of Series B Convertible Preferred Stock and warrants to purchase 1,645,361 shares of common stock at an exercise price of $0.14 per share. The value of the derivative liability related to the warrants was $674,000 and the value of the derivative liability related to the preferred shares was $155,000. | |
In connection with the private placement of Series B Convertible Preferred Stock, the Company recorded a liability for the conversion feature that contains a provision that protect holders from a decline in the issue price of the Company’s common stock (“down-round” provision). The Company estimates the fair values of the conversion feature using a Monte Carlo valuation model. The Company measured the fair value of the conversion feature on June 26, 2013 and July 15, 2013 and recorded the initial liability as part of the private placement proceeds. | |
On May 16, 2014, 188,938 preferred shares were converted into 1,889,380 shares of common stock. Due to this conversion, a gain on derivative liabilities of $118,000 was recognized and $741,000 was reclassified out of the derivative liability account and into equity. | |
The Company re-measured the fair value of the conversion feature at September 30, 2014 and recorded an $18.4 million gain on derivative liabilities during the third quarter to adjust the liability associated with the conversion feature to an estimated fair value of $7.6 million. The change in fair value and the associated gain was attributable to a decline in the market value of our common stock as of September 30, 2014. | |
Warrants_and_Warrants_Liabilit
Warrants and Warrants Liability | 9 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Stockholders Equity Note [Abstract] | ' | ||||||||||||
Stockholders Equity Note Warrants Disclosure [Text Block] | ' | ||||||||||||
4. Warrants and Warrants Liability | |||||||||||||
The Company follows ASC 815-40, Contracts in an Entity’s Own Equity, as it relates to outstanding warrants. | |||||||||||||
In connection with the December 2013 private placement of 72,007,000 shares of the Company's common stock at a price per share of $0.25, the Company issued an aggregate of warrants to purchase 4,320,420 shares of common stock at an exercise price of $0.25 per share to the placement agents. These warrants expire December 2018. These warrants contain provisions that protect holders from a decline in the issue price of the Company’s common stock (“down-round” provision) and contain net settlement provisions. Due to these provisions, the Company accounted for these warrants as liabilities instead of equity. | |||||||||||||
In connection with the private placement of Series B Convertible Preferred Stock, which occurred through two closings on June 26, 2013 and July 15, 2013, respectively, the Company issued an aggregate of warrants to purchase 30,040,194 shares of common stock at an exercise price of $0.14 per share. These warrants expire June 2018. These warrants contain provisions that protect holders from a decline in the issue price of the Company’s common stock (“down-round” provision) and contain net settlement provisions. Due to these provisions, the Company accounted for these warrants as liabilities instead of equity. The Company measured the fair value of these warrants on June 26, 2013 and July 15, 2013 and recorded the initial liability as part of the private placement proceeds and expensed $1.4 million for the warrants issued to the placement agent. | |||||||||||||
We estimate the fair values of these securities using a Monte Carlo valuation model. The following warrants were issued in 2013 using the Monte Carlo valuation method with the key inputs as follows: | |||||||||||||
June 26, 2013 | July 15, 2013 | December 23, 2013 | |||||||||||
Warrants issued | 28,394,834 | 1,645,360 | 4,320,420 | ||||||||||
Risk free interest rate | 0.0109 | 0.0109 | 0.0167 | ||||||||||
Volatility | 160.94 | % | 163.08 | % | 155.24 | % | |||||||
Expected term | 5 years | 5 years | 5 years | ||||||||||
Exercise price | $ | 0.14 | $ | 0.14 | $ | 0.25 | |||||||
From February through May 2013, in connection with the issuance of new convertible promissory notes, the Company issued warrants to purchase up to 7,030,387 shares of its common stock. These warrants expire February through May 2018 and are exercisable at a price of $0.14 per share. These warrants are considered to be equity. | |||||||||||||
In 2011, in connection with the Biocontrol business combination, the Company issued warrants to purchase up to 1,355,164 shares of its common stock. These warrants expire in December 2016 and are exercisable at a price of $0.46 per share. These warrants are considered to be equity. | |||||||||||||
On June 26, 2014, 3,855,714 warrants, issued on June 26, 2013, were exercised. Due to this exercise, 2,734,151 shares of common stock were issued, a gain on derivative liabilities of $398,000 was recognized, and $1,729,000 was classified out of the derivative liability account and into equity. | |||||||||||||
The Company re-measured the fair value of the liability warrants at September 30, 2014 and recorded a $5.9 million gain on derivative liabilities during the third quarter to adjust the liabilities associated with the warrants to their estimated fair values totaling $6.9 million. The change in fair value and the resulting gain was attributable to a decline in the market value of our common stock as of September 30, 2014. | |||||||||||||
Stock_Options
Stock Options | 9 Months Ended | |||||||||||||
Sep. 30, 2014 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | ' | |||||||||||||
5. Stock Options | ||||||||||||||
In October 2012, our board of directors approved and adopted the 2012 Stock Incentive Plan, which we refer to as the 2012 Plan. Under the 2012 Plan, we are authorized to issue up to 35,000,000 shares of our common stock in stock incentive awards to employees, directors and consultants. | ||||||||||||||
In March 2009, our board of directors and shareholders adopted the 2009 Stock Incentive Plan, which we refer to as the 2009 Stock Incentive Plan. Under the 2009 Plan, we are authorized to issue up to 4,200,000 shares of our common stock in stock incentive awards to employees, directors and consultants. | ||||||||||||||
In December 2013, our board of directors adopted the 2013 Plan. Under the 2013 Plan, we are authorized to issue up to 40,000,000 shares of our common stock in stock incentive awards to employees, directors and consultants. Our shareholders approved the 2013 Plan in February 2014. | ||||||||||||||
The Company’s 2013 Stock Incentive Plan provides for the issuance of long-term incentive awards, or Awards, in the form of non-qualified and incentive stock options, or Options, stock appreciation rights, stock grants and restricted stock units. The Awards may be granted by the Company’s Board of Directors to its employees, directors and officers and to consultants, agents, advisors and independent contractors who provide services to the Company. The exercise price for Options must not be less than the fair market value of the underlying shares on the date of grant. Options expire no later than ten years from the date of grant and generally vest and become exercisable over a four-year period following the date of grant. Under the 2012 Plan, every non-employee member of the Company’s Board of Directors may elect to receive a non-qualified Option or restricted stock unit grant in lieu of certain cash compensation. Upon the exercise of Options, the Company issues the resulting shares from shares reserved for issuance under the Company’s Incentive Plans. | ||||||||||||||
Under ASC 718 Stock Compensation, the Company is required to expense the fair value of share-based payments granted over the vesting period. The Company values Awards granted at their grant date fair value in accordance with the provisions of ASC 718 and recognizes stock-based compensation expense on a straight-line basis over the service period of each award. | ||||||||||||||
Stock-based compensation expense is reduced by an estimated forfeiture rate derived from historical employee termination behavior. If the actual number of forfeitures differs from the Company’s estimates, the Company may record adjustments to increase or decrease compensation expense in future periods. There were no significant adjustments related to changes in the Company’s estimates for the three and nine month periods ended September 30, 2013 and 2014. | ||||||||||||||
Following is a summary of the amount included as stock-based compensation expense in the accompanying consolidated statements of operations and comprehensive income (loss): | ||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Income statement category: | ||||||||||||||
Research and development | $ | 38,000 | $ | 40,000 | $ | 116,000 | $ | 153,000 | ||||||
General and administrative | 195,000 | 208,000 | 643,000 | 1,053,000 | ||||||||||
Severance charge | 831,000 | — | 831,000 | — | ||||||||||
Total stock-based compensation expense | $ | 1,064,000 | $ | 248,000 | $ | 1,590,000 | $ | 1,206,000 | ||||||
The following table summarizes Option activity: | ||||||||||||||
Average Remaining | ||||||||||||||
Weighted Average | Contractual Term | |||||||||||||
Shares | Exercise Price | (Years) | Intrinsic Value | |||||||||||
Outstanding at December 31, 2013 | 25,721,000 | $ | 0.19 | |||||||||||
Granted | — | — | ||||||||||||
Exercised | — | — | ||||||||||||
Forfeited | 3,137,378 | 0.19 | ||||||||||||
Expired | 2,000 | 13.1 | ||||||||||||
Outstanding at September 30, 2014 | 22,581,622 | $ | 0.19 | 2.15 | $ | 862,982 | ||||||||
Exercisable at September 30, 2014 | 19,972,558 | $ | 0.19 | 1.35 | $ | 822,989 | ||||||||
The aggregate intrinsic value is determined using the closing price of the Company’s common stock of $0.22 on September 30, 2014. | ||||||||||||||
As of September 30, 2014, the Company had unrecognized compensation cost related to unvested Options of approximately $559,358 net of estimated forfeitures, which the Company expects to recognize over a weighted average period of approximately two and a half years. | ||||||||||||||
As of September 30, 2014, the Company had reserved shares of its common stock for future issuance as follows: | ||||||||||||||
Shares Reserved | ||||||||||||||
Stock options outstanding | 22,581,622 | |||||||||||||
Available for future grants under the 2013 Stock Incentive Plan | 39,250,000 | |||||||||||||
Warrants | 38,890,451 | |||||||||||||
Total shares reserved | 100,722,073 | |||||||||||||
Severance_Charge
Severance Charge | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Severance Charge Abstract [Abstract] | ' | ||||
Severance Charge Disclosure [Text Block] | ' | ||||
6. Severance Charge | |||||
On September 15, 2014, by mutual agreement of the Board of Directors (the “Board”) of the Company and Philip J. Young, Mr. Young stepped down from his role as President and Chief Executive Officer of the Company, effective September 15, 2014. In accordance with Mr. Young’s employment agreements, the Company recorded a severance charge in the quarter ended September 30, 2014 of $1,510,000 related to severance-period compensation and benefits, as well as stock-based compensation expense related to the accelerated vesting of stock options .The composition of the severance charge is as follows: | |||||
Compensation and benefits | $ | 679,000 | |||
Stock-based compensation expenses related to accelerated vesting | 831,000 | ||||
Total severance charge | $ | 1,510,000 | |||
Nature_of_Business_and_Signifi1
Nature of Business and Significant Accounting Policies (Policies) | 9 Months Ended | ||
Sep. 30, 2014 | |||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ||
Basis of Accounting, Policy [Policy Text Block] | ' | ||
Basis of Presentation | |||
The interim consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries - Biocontrol, Ampliphi d.o.o., and AmpliPhi Australia. All significant intercompany accounts and transactions have been eliminated. All amounts on the financial statements and disclosures have been rounded to the nearest $1,000 except share and per share data. | |||
The interim consolidated financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission, or SEC. In the opinion of the Company’s management, all adjustments (consisting of normal recurring adjustments, reclassifications, and non-recurring adjustments) necessary to present fairly our results of operations for the three months and nine months ended September 30, 2014 and 2013, our cash flows for the nine months ended September 30, 2014 and 2013 and our financial position as of September 30, 2014 have been made. The results of operations for such interim periods are not necessarily indicative of the operating results to be expected for the full year. | |||
Certain information and disclosures normally included in the notes to the annual financial statements have been condensed or omitted from these interim consolidated financial statements. Accordingly, these interim consolidated financial statements should be read in conjunction with the 2013 audited consolidated financial statements and notes. | |||
Use of Estimates, Policy [Policy Text Block] | ' | ||
Use of Estimates | |||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | |||
Cash and Cash Equivalents, Policy [Policy Text Block] | ' | ||
Cash and Cash Equivalents | |||
The Company considers cash equivalents to be short-term investments that have a maturity at the time of purchase of three months or less, are readily convertible into cash and have an insignificant level of valuation risk attributable to potential changes in interest rates. Cash equivalents are recorded at cost, which approximates fair market value, and consist primarily of money market accounts. | |||
Trade and Other Accounts Receivable, Policy [Policy Text Block] | ' | ||
Accounts Receivable | |||
Accounts receivable amounts are stated at their face amounts less any allowance. Provisions for doubtful accounts are estimated based on assessment of the probable collection from specific customer accounts and other known factors. If an account was determined to be uncollectible (payment has not been made in accordance with contract terms), it would be written off against the allowance. As of September 30, 2014 and December 31, 2013, management determined no allowance for doubtful accounts was required. | |||
Property, Plant and Equipment, Policy [Policy Text Block] | ' | ||
Property and Equipment | |||
Property and equipment are recorded at cost and are depreciated using the straight-line method over the estimated useful lives of the related assets, generally three to seven years. | |||
Other Current Assets [Text Block] | ' | ||
Prepaid Expenses and Other Current Assets | |||
Prepaid and other current assets as of September 30, 2014 and December 31, 2013 consist primarily of prepaid insurance and deposits. | |||
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | ' | ||
Goodwill | |||
Investments in purchased companies in excess of the underlying fair value of net assets at the date of acquisition are recorded as goodwill and assessed annually for impairment. If considered impaired, goodwill will be written down to fair value and a corresponding impairment loss recognized. | |||
In 2012, the rights to SPH Holdings Pty Ltd’s know-how and phage libraries were acquired in a business combination with an aggregate value of $7,172,000. Goodwill in the amount of $2,381,000 was recorded. In management’s opinion, no goodwill has been impaired as of September 30, 2014 and December 31, 2013. | |||
In 2011, the rights to Biocontrol Limited’s patents and phage libraries were acquired in a business combination with an aggregate value of $8,584,000. Goodwill in the amount of $1,948,000 was recorded. In management’s opinion, no goodwill has been impaired as of September 30, 2014 and December 31, 2013. | |||
Goodwill and Intangible Assets, Intangible Assets, Policy [Policy Text Block] | ' | ||
Patents | |||
Patents are recorded at cost and are amortized using the straight-line method over the estimated useful lives of the patents. | |||
In 2011, the rights to Biocontrol Limited’s patents were acquired in a business combination. Patents in the amount of $493,000 have been recorded. These patents are being amortized over their useful life through December 2026. | |||
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | ' | ||
Stock-Based Compensation | |||
The Company accounts for stock-based payments under the guidance of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 718, Stock Compensation, which requires measurement of compensation cost for all share-based payment awards at fair value on the date of grant and recognition of compensation cost over the requisite service period (typically the vesting period) for awards expected to vest. | |||
Warrant and Preferred Shares Conversion Feature Liability, Policy [Policy Text Block] | ' | ||
Warrant and Preferred Shares Conversion Feature Liability | |||
The Company accounts for warrants and the preferred shares conversion feature of the Company’s Series B preferred stock with anti-dilution (“down-round”) provisions under the guidance of ASC 815, Derivatives, and Hedging and Emerging Issue Task Force Statement 07-5: Determining Whether an Instrument (or Embedded Feature) Is Indexed to an Entity’s Own Stock, which require such warrants and the Series B preferred shares conversion feature to be recorded as a liability and adjusted to fair value in each reporting period. | |||
Derivatives, Policy [Policy Text Block] | ' | ||
Fair Value of Financial Assets and Liabilities — Derivative Instruments | |||
The Company measures the fair value of financial assets and liabilities in accordance with GAAP, which defines fair value, establishes a framework for measuring fair value, and requires certain disclosures about fair value measurements. | |||
GAAP defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. GAAP also establishes as fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. GAAP describes three levels of inputs that may be used to measure fair value: | |||
Level 1 — quoted prices in active markets for identical assets or liabilities. | |||
Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable. | |||
Level 3 — inputs that are unobservable. | |||
The Company does not use derivative financial instruments to hedge exposures to cash-flow, market or foreign-currency risks. However, the Company has entered into certain financial instruments and contracts, such as convertible loan notes with detachable common stock warrants and the issuance of preferred stock with detachable common stock warrants with features that are either i) not afforded equity classification, ii) embody risks not clearly and closely related to host contracts, or iii) may be net-cash settled by the counterparty. These instruments are required to be carried as derivative liabilities, at fair value. | |||
The Company estimates fair values of these derivatives utilizing Level 2 inputs. The Company uses the Monte Carlo valuation technique as it embodies all of the requisite assumptions (including trading volatility, remaining term to maturity, market price, strike price, and risk free rates) necessary to fair value these instruments. | |||
Estimating fair values of derivative financial instruments, including Level 2 instruments, require the use of significant and subjective inputs that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques are volatile and sensitive to changes in our trading market price, the trading market price of various peer companies and other key assumptions. Since derivative financial instruments are initially and subsequently carried at fair value, our income will reflect this sensitivity of internal and external factors. | |||
Revenue Recognition, Policy [Policy Text Block] | ' | ||
Revenue Recognition | |||
The Company generates revenue from technology licenses. Revenue under technology licenses typically consists of nonrefundable, up-front license fees, technology access fees and various other payments. The Company recognizes revenue associated with performance milestones as earned, typically based upon the achievement of the specific milestones defined in the applicable agreements. | |||
The Company recognizes revenue under research and development contracts as the related costs are incurred. When contracts include multiple elements, the Company follows ASC 605-25, Multiple Element Arrangements, which requires the Company to satisfy the following before revenue can be recognized: | |||
• | The delivered items have value to the customer on a stand-alone basis; | ||
• | Any undelivered items have objective and reliable evidence of fair value; and | ||
• | Delivery or performance is probable and within the Company’s control for any delivered items that have a right of return. | ||
The Company classifies advance payments received in excess of amounts earned as deferred revenue. | |||
Based upon the terms specified in its collaboration agreements, the Company receives advance payments from some of its collaboration partners before the project has been performed. These payments are deferred and recognized as revenue when the costs are incurred. | |||
Research and Development Expense, Policy [Policy Text Block] | ' | ||
Research and Development | |||
Research and development costs include salaries, costs of outside collaborators and outside services, royalty and license costs and allocated facility, occupancy and utility expenses. The Company expenses research and development costs as incurred. | |||
In Process Research & Development (IPR&D) assets represent capitalized incomplete research projects that the Company acquired through business combinations. Such assets are initially measured at their acquisition date fair values. The fair value of the research projects is recorded as intangible assets on the consolidated balance sheet rather than expensed regardless of whether these assets have an alternative future use. The amounts capitalized are being accounted for as indefinite-lived intangible assets, subject to impairment testing until completion or abandonment of research and development efforts associated with the projects. Upon successful completion of each project, the Company will make a determination as to the then remaining useful life of the intangible asset and begin amortization. The Company tests its indefinite-lived intangibles, including IPR&D assets, for impairment at least annually. In 2012, the rights to SPH Holdings Pty Ltd’s know-how and phage libraries were acquired by a business combination for $7,172,000. In 2012, IPR&D in the amount of $5,161,000 was recorded. In management’s opinion, this IPR&D has not been impaired as of September 30, 2014 and December 31, 2013. | |||
In 2011, the rights to Biocontrol Limited’s patents and phage libraries were acquired by a business combination $8,584,000. In 2011, IPR&D in the amount of $7,285,000 was recorded. In management’s opinion, this IPR&D has not been impaired as of September 30, 2014 and December 31, 2013. | |||
Earnings Per Share, Policy [Policy Text Block] | ' | ||
Net Income (Loss) per Common Share | |||
Net income (loss) per common share is based on net income (loss) divided by the weighted average number of common shares outstanding during the period. For the three months ended September 30, 2014 and the nine months ended September 30, 2014, both basic and diluted net income (loss) are disclosed in the Consolidated Statements of Operations and Comprehensive Income. For the three months ended September 30, 2013 and the nine months ended September 30, 2013, the diluted net loss per share is the same as the basic net loss per share because all stock options, warrants, contingent shares, and Series B Preferred shares were antidilutive with respect to computing the net loss per share and therefore were excluded from the calculation of diluted net loss per share. The total number of shares that the Company excluded from the calculations of net loss per share was 150,283,630 shares for the three month period ending September 30, 2013 and 63,155,331 shares for the nine month period ending September 30, 2013. | |||
New Accounting Pronouncements, Policy [Policy Text Block] | ' | ||
Recent Accounting Pronouncements | |||
On February 5, 2013, the FASB issued ASU no. 2013-02 which adds new disclosure requirements for items reclassified out of accumulated other comprehensive income (AOCI). The ASU is intended to help entities improve the transparency of changes in other comprehensive income (OCI) and items reclassified out of AOCI in their financial statements. It does not amend any existing requirements for reporting net income or OCI in the financial statements. For public entities, the new disclosure requirements are effective for fiscal years, and interim periods within those years, beginning after December 15, 2012. For nonpublic entities, the ASU is effective for fiscal years beginning after December 15, 2013, and interim and annual periods thereafter. The Company elected to early adopt this standard which did not result in any changes to the consolidated financial statements. | |||
Warrants_and_Warrants_Liabilit1
Warrants and Warrants Liability (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Stockholders Equity Note [Abstract] | ' | ||||||||||||
Schedule of Stockholders Equity Note, Warrants or Rights [Table Text Block] | ' | ||||||||||||
We estimate the fair values of these securities using a Monte Carlo valuation model. The following warrants were issued in 2013 using the Monte Carlo valuation method with the key inputs as follows: | |||||||||||||
June 26, 2013 | July 15, 2013 | December 23, 2013 | |||||||||||
Warrants issued | 28,394,834 | 1,645,360 | 4,320,420 | ||||||||||
Risk free interest rate | 0.0109 | 0.0109 | 0.0167 | ||||||||||
Volatility | 160.94 | % | 163.08 | % | 155.24 | % | |||||||
Expected term | 5 years | 5 years | 5 years | ||||||||||
Exercise price | $ | 0.14 | $ | 0.14 | $ | 0.25 | |||||||
Stock_Options_Tables
Stock Options (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2014 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block] | ' | |||||||||||||
Following is a summary of the amount included as stock-based compensation expense in the accompanying consolidated statements of operations and comprehensive income (loss): | ||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Income statement category: | ||||||||||||||
Research and development | $ | 38,000 | $ | 40,000 | $ | 116,000 | $ | 153,000 | ||||||
General and administrative | 195,000 | 208,000 | 643,000 | 1,053,000 | ||||||||||
Severance charge | 831,000 | — | 831,000 | — | ||||||||||
Total stock-based compensation expense | $ | 1,064,000 | $ | 248,000 | $ | 1,590,000 | $ | 1,206,000 | ||||||
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | ' | |||||||||||||
The following table summarizes Option activity: | ||||||||||||||
Average Remaining | ||||||||||||||
Weighted Average | Contractual Term | |||||||||||||
Shares | Exercise Price | (Years) | Intrinsic Value | |||||||||||
Outstanding at December 31, 2013 | 25,721,000 | $ | 0.19 | |||||||||||
Granted | — | — | ||||||||||||
Exercised | — | — | ||||||||||||
Forfeited | 3,137,378 | 0.19 | ||||||||||||
Expired | 2,000 | 13.1 | ||||||||||||
Outstanding at September 30, 2014 | 22,581,622 | $ | 0.19 | 2.15 | $ | 862,982 | ||||||||
Exercisable at September 30, 2014 | 19,972,558 | $ | 0.19 | 1.35 | $ | 822,989 | ||||||||
Schedule of Common Stock, Capital Shares Reserved for Future Issuance [Table Text Block] | ' | |||||||||||||
As of September 30, 2014, the Company had reserved shares of its common stock for future issuance as follows: | ||||||||||||||
Shares Reserved | ||||||||||||||
Stock options outstanding | 22,581,622 | |||||||||||||
Available for future grants under the 2013 Stock Incentive Plan | 39,250,000 | |||||||||||||
Warrants | 38,890,451 | |||||||||||||
Total shares reserved | 100,722,073 | |||||||||||||
Severance_Charge_Tables
Severance Charge (Tables) | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Severance Charge Abstract [Abstract] | ' | ||||
Severance Charge [Table Text Block] | ' | ||||
The composition of the severance charge is as follows: | |||||
Compensation and benefits | $ | 679,000 | |||
Stock-based compensation expenses related to accelerated vesting | 831,000 | ||||
Total severance charge | $ | 1,510,000 | |||
Nature_of_Business_and_Signifi2
Nature of Business and Significant Accounting Policies (Details Textual) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | |
Patents [Member] | SPH Holdings Pty Ltd [Member] | Biocontrol Limited [Member] | In Process Research and Development [Member] | In Process Research and Development [Member] | |||||
SPH Holdings Pty Ltd [Member] | Biocontrol Limited [Member] | ||||||||
Significant Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Combination, Consideration Transferred, Total | ' | ' | ' | ' | ' | $7,172,000 | $8,584,000 | ' | ' |
Goodwill | ' | 4,329,000 | ' | 4,329,000 | ' | 2,381,000 | 1,948,000 | ' | ' |
Intangible Assets, Net (Excluding Goodwill) | ' | 12,446,000 | ' | 12,446,000 | ' | ' | ' | 5,161,000 | 7,285,000 |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 150,283,630 | ' | 63,155,331 | ' | ' | ' | ' | ' | ' |
Property, Plant and Equipment, Estimated Useful Lives | ' | 'three to seven years | ' | ' | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets, Net | ' | ' | ' | ' | $493,000 | ' | ' | ' | ' |
Liquidity_Details_Textual
Liquidity (Details Textual) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Liquidity Disclosure [Line Items] | ' | ' |
Retained Earnings (Accumulated Deficit), Total | ($355,312,000) | ($378,074,000) |
Preferred_Shares_Details_Textu
Preferred Shares (Details Textual) (USD $) | 9 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | ||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
Common Stock [Member] | Preferred Stock [Member] | Preferred Stock [Member] | Warrant [Member] | Warrant [Member] | Convertible Notes Payable One [Member] | Convertible Notes Payable One [Member] | Convertible Notes Payable One [Member] | Convertible Notes Payable Two [Member] | Convertible Notes Payable Two [Member] | Convertible Notes Payable Two [Member] | Series B Convertible Preferred Stock [Member] | Series B Convertible Preferred Stock [Member] | Series B Convertible Preferred Stock [Member] | ||||
Preferred Stock [Member] | Warrant [Member] | Preferred Stock [Member] | Warrant [Member] | Convertible Notes Payable One [Member] | Convertible Notes Payable Two [Member] | ||||||||||||
Class of Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock, Shares Authorized | 10,000,000 | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,016,080 | ' | ' |
Preferred Stock, Initial Stated Value Per Share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1.40 | ' | ' |
Preferred Stock, Par or Stated Value Per Share | $0.01 | ' | $0.01 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.01 | ' | ' |
Debt Instrument, Convertible, Number of Equity Instruments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10 | ' | ' |
Preferred Stock, Dividend Rate, Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' |
Debt Instrument, Convertible, If-initial public offering proceeds meets Least amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $7,000,000 | ' | ' |
Stock Issued During Period, Shares, New Issues1 | ' | ' | ' | ' | ' | 4,999,999 | ' | ' | ' | ' | ' | ' | ' | ' | 4,999,999 | ' | ' |
Warrants Issued During the Period, Number of Warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,645,361 | ' | ' | 12,499,996 | 10,894,839 | ' |
Warrants Issued During the Period, Exercise Price of Warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.14 | $0.14 | ' |
Warrants Issued During the Period, Value of Warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,000,000 | ' | ' |
Debt Conversion, Original Debt, Amount | ' | ' | ' | ' | ' | ' | ' | ' | 5,491,001 | ' | ' | 829,277 | ' | ' | ' | ' | ' |
Debt Conversion, Converted Instrument, Shares Issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,357,936 | 658,145 |
Debt Instrument, Convertible, Beneficial Conversion Feature | 18,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative preferred shares conversion liability | 7,633,000 | ' | 34,443,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Liability | ' | ' | ' | ' | ' | 5,064,000 | ' | 1,886,000 | ' | 3,804,000 | 1,644,000 | ' | 155,000 | 674,000 | ' | ' | ' |
Warrants Issued During Period Number Of Warrants1 | ' | ' | ' | ' | ' | ' | ' | ' | 4,999,999 | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants Issued During Period Exercise Price Of Warrants1 | ' | ' | ' | ' | ' | ' | ' | ' | $0.14 | ' | ' | $0.14 | ' | ' | ' | ' | ' |
Fair Value Adjustment of Warrants | 0 | 759,000 | ' | ' | ' | ' | ' | ' | 759,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Payments of Stock Issuance Costs | ' | ' | ' | ' | ' | ' | ' | ' | 350,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion of Stock, Shares Converted | ' | ' | ' | 1,889,380 | 188,938 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion of Stock, Shares Issued | ' | ' | ' | ' | ' | ' | 118,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reclassification From Derivative Liability To Equity | $741,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants_and_Warrants_Liabilit2
Warrants and Warrants Liability (Details) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Warrants Issued on June 26, 2013 Member [Member] | ' |
Class of Warrant or Right [Line Items] | ' |
Warrants Issued | 28,394,834 |
Risk free interest rate | 0.01% |
Volatility | 160.94% |
Expected term | '5 years |
Exercise price | $0.14 |
Warrants Issued on July 15, 2013 Member [Member] | ' |
Class of Warrant or Right [Line Items] | ' |
Warrants Issued | 1,645,360 |
Risk free interest rate | 0.01% |
Volatility | 163.08% |
Expected term | '5 years |
Exercise price | $0.14 |
Warrants Issued on December 23, 2013 Member [Member] | ' |
Class of Warrant or Right [Line Items] | ' |
Warrants Issued | 4,320,420 |
Risk free interest rate | 0.02% |
Volatility | 155.24% |
Expected term | '5 years |
Exercise price | $0.25 |
Warrants_and_Warrants_Liabilit3
Warrants and Warrants Liability (Details Textual) (USD $) | 9 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
Warrants Issued on June 26, 2013 Member [Member] | Warrants Issued on June 26, 2013 Member [Member] | Biocontrol Limited [Member] | Convertible Notes Payable [Member] | Series B Convertible Preferred Stock [Member] | Common Stock [Member] | Private Placement [Member] | Private Placement [Member] | |||
Series B Convertible Preferred Stock [Member] | Common Stock [Member] | |||||||||
Class of Warrant or Right [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Shares, New Issues2 | ' | ' | ' | ' | ' | ' | ' | 72,007,000 | ' | 72,007,000 |
Stock Issued During Period, Exercise Price, New Issues2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.25 |
Warrants Issued During the Period, Terms Of Expiration | ' | ' | ' | ' | 'December 2016 | 'February through May 2018 | ' | ' | 'June 2018 | 'December 2018 |
Warrants Issued During the Period, Number of Warrants | ' | ' | ' | 28,394,834 | 1,355,164 | 7,030,387 | 12,499,996 | ' | 30,040,194 | ' |
Warrants Issued During the Period, Exercise Price of Warrants | ' | ' | ' | ' | $0.46 | $0.14 | $0.14 | ' | $0.14 | ' |
Warrants Issuance Costs | ' | ' | ' | ' | ' | ' | ' | ' | $1,400,000 | ' |
Derivative warrants liability | 6,949,000 | 16,664,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants Exercised During Period Value | ' | ' | 3,855,714 | ' | ' | ' | ' | ' | ' | ' |
Common Stock Issued During Period Value Warrants Exercised | ' | ' | 2,734,151 | ' | ' | ' | ' | ' | ' | ' |
Derivative, Gain on Derivative | 5,900,000 | ' | 398,000 | ' | ' | ' | ' | ' | ' | ' |
Reclassifications of Temporary to Permanent Equity | ' | ' | $1,729,000 | ' | ' | ' | ' | ' | ' | ' |
Stock_Options_Details
Stock Options (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Allocated Share-based Compensation Expense | $1,064,000 | $248,000 | $1,590,000 | $1,206,000 |
General and administrative expense [Member] | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Allocated Share-based Compensation Expense | 195,000 | 208,000 | 643,000 | 1,053,000 |
Research and development expense [Member] | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Allocated Share-based Compensation Expense | 831,000 | 0 | 831,000 | 0 |
Research and Development [Member] | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Allocated Share-based Compensation Expense | $38,000 | $40,000 | $116,000 | $153,000 |
Stock_Options_Details_1
Stock Options (Details 1) (Employee Stock Option [Member], USD $) | 9 Months Ended |
Sep. 30, 2014 | |
Employee Stock Option [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Shares, Outstanding at December 31, 2013 | 25,721,000 |
Shares, Granted | 0 |
Shares, Exercised | 0 |
Shares, Forfeited | 3,137,378 |
Shares, Expired | 2,000 |
Shares, Outstanding at September 30, 2014 | 22,581,622 |
Shares, Exercisable at September 30, 2014 | 19,972,558 |
Weighted Average Exercise Price, Outstanding at December 31, 2013 | $0.19 |
Weighted Average Exercise Price, Granted | $0 |
Weighted Average Exercise Price, Exercised | $0 |
Weighted Average Exercise Price, Forfeited | $0.19 |
Weighted Average Exercise Price, Expired | $13.10 |
Weighted Average Exercise Price, Outstanding at September 30, 2014 | $0.19 |
Weighted Average Exercise Price, Exercisable at September 30, 2014 | $0.19 |
Average Remaining Contractual Term (Years), Outstanding at September 30, 2014 | '2 years 1 month 24 days |
Average Remaining Contractual Term (Years), Exercisable at September 30, 2014 | '1 year 4 months 6 days |
Intrinsic Value, Outstanding at September 30, 2014 | $862,982 |
Intrinsic Value, Exercisable at September 30, 2014 | $822,989 |
Stock_Options_Details_2
Stock Options (Details 2) (Employee Stock Option [Member]) | Sep. 30, 2014 | Dec. 31, 2013 |
Employee Stock Option [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock options outstanding | 22,581,622 | 25,721,000 |
Available for future grants under the 2013 Stock Incentive Plan | 39,250,000 | ' |
Warrants | 38,890,451 | ' |
Total shares reserved | 100,722,073 | ' |
Stock_Options_Details_Textual
Stock Options (Details Textual) (USD $) | 9 Months Ended |
Sep. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Grant Date Intrinsic Value | $0.22 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options | $559,358 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | '2 years 6 months |
2012 Stock Incentive Plan [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 35,000,000 |
2009 Stock Incentive Plan [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 4,200,000 |
2013 Stock Incentive Plan [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 40,000,000 |
Severance_Charge_Details
Severance Charge (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Severance Charge [Line Items] | ' | ' | ' | ' |
Compensation and benefits | ' | ' | $679,000 | ' |
Stock-based compensation expenses related to accelerated vesting | ' | ' | 831,000 | 0 |
Total severance charge | $1,510,000 | $0 | $1,510,000 | $0 |