Document And Entity Information
Document And Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 03, 2020 | Jun. 28, 2019 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Entity Registrant Name | ARMATA PHARMACEUTICALS, INC. | ||
Entity Current Reporting Status | Yes | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Interactive Data Current | Yes | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 10,927,032 | ||
Entity Public Float | $ 38.9 | ||
Entity Central Index Key | 0000921114 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash and cash equivalents | $ 6,033,000 | $ 9,663,000 |
Prepaid expenses and other current assets | 622,000 | 697,000 |
Total current assets | 6,655,000 | 10,360,000 |
Restricted cash | 700,000 | 800,000 |
Property and equipment, net | 2,187,000 | 3,249,000 |
Operating lease right-of-use asset | 2,028,000 | |
In-process research and development | 10,256,000 | |
Goodwill | 3,490,000 | |
Other assets | 135,000 | 136,000 |
Total assets | 25,451,000 | 14,545,000 |
Current liabilities | ||
Accounts payable and accrued liabilities | 1,278,000 | 536,000 |
Accounts payable | 547,000 | 415,000 |
Accrued compensation | 1,323,000 | 191,000 |
Deferred asset acquisition consideration | 970,000 | 970,000 |
Current portion of operating lease liabilities | 1,308,000 | |
Deferred rent | 335,000 | |
Total current liabilities | 4,879,000 | 2,032,000 |
Deferred rent, net of current portion | 810,000 | |
Operating lease liabilities, net of current portion | 1,555,000 | |
Deferred asset acquisition consideration, net of current portion | 1,347,000 | 2,892,000 |
Asset acquisition derivative liability | 1,117,000 | |
Deferred tax liability | 3,077,000 | |
Total liabilities | 10,858,000 | 6,851,000 |
Stockholders' equity | ||
Common stock, $0.01 par value; 217,000,000 shares authorized; 9,934,299 and 5,069,633 shares issued and outstanding at December 31, 2019 and December 31, 2018, respectively. | 99,000 | 51,000 |
Additional paid-in capital | 172,015,000 | 145,685,000 |
Accumulated deficit | (157,521,000) | (138,042,000) |
Total stockholders' equity | 14,593,000 | 7,694,000 |
Total liabilities and stockholders' equity | $ 25,451,000 | $ 14,545,000 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 217,000,000 | 217,000,000 |
Common stock, shares issued | 9,922,758 | 5,069,633 |
Common stock, shares outstanding | 9,922,758 | 5,069,633 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Operating expenses | ||
Research and development | $ 9,824,000 | $ 8,372,000 |
Acquired in-process research and development | 6,767,000 | |
General and administrative | 9,265,000 | 2,519,000 |
Loss on sale of assets (Note 6) | 663,000 | |
Total operating expenses | 19,752,000 | 17,658,000 |
Loss from operations | (19,752,000) | (17,658,000) |
Other income (expense) | ||
Interest income | 96,000 | 245,000 |
Interest expense | (931,000) | (1,013,000) |
Other income (expense) | (9,000) | |
Change in fair value of derivative liabilities | 1,117,000 | 1,724,000 |
Total other income (expense), net | 273,000 | 956,000 |
Loss before income taxes | (19,479,000) | (16,702,000) |
Net loss | (19,479,000) | (16,702,000) |
Unrealized gain on investments | 7,000 | |
Comprehensive loss | $ (19,479,000) | $ (16,695,000) |
Per share information: | ||
Net loss per share, basic | $ (2.49) | $ (3.59) |
Weighted average shares outstanding, basic | 7,827,197 | 4,652,777 |
Net loss per share, diluted | $ (2.55) | $ (3.59) |
Weighted average shares outstanding, diluted | 8,009,909 | 4,652,777 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | AOCI Attributable to Parent [Member] | Total |
Balances at Dec. 31, 2017 | $ 51,000 | $ 145,639,000 | $ (121,340,000) | $ (7,000) | $ 24,343,000 |
Balances (in shares) at Dec. 31, 2017 | 5,073,669 | ||||
Grant of restricted stock awards (in shares) | 16,892 | ||||
Forfeiture of restricted stock awards (in shares) | (20,928) | ||||
Stock-based compensation | 46,000 | 46,000 | |||
Net loss | (16,702,000) | (16,702,000) | |||
Unrealized gain on available-for-sale securities | $ 7,000 | 7,000 | |||
Balances at Dec. 31, 2018 | $ 51,000 | 145,685,000 | (138,042,000) | 7,694,000 | |
Balances (in shares) at Dec. 31, 2018 | 5,069,633 | ||||
Forfeiture of restricted stock awards | (39,000) | (39,000) | |||
Forfeiture of restricted stock awards (in shares) | (44,255) | ||||
Issuance of common stock and conversion of deferred consideration for asset acquisition | $ 5,000 | 1,457,000 | 1,462,000 | ||
Issuance of common stock and conversion of deferred consideration for asset acquisition (in shares) | 516,976 | ||||
Issuance of common stock in connection with reverse merger | $ 23,000 | 10,686,000 | 10,709,000 | ||
Issuance of common stock in connection with reverse merger (in shares) | 2,389,135 | ||||
Sale of common stock, net of issuance costs | $ 20,000 | 9,955,000 | 9,975,000 | ||
Sale of common stock, net of issuance costs (in shares) | 1,991,269 | ||||
Stock-based compensation | 4,271,000 | 4,271,000 | |||
Net loss | (19,479,000) | (19,479,000) | |||
Balances at Dec. 31, 2019 | $ 99,000 | $ 172,015,000 | $ (157,521,000) | $ 14,593,000 | |
Balances (in shares) at Dec. 31, 2019 | 9,922,758 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Operating activities: | ||
Net loss | $ (19,479,000) | $ (16,702,000) |
Adjustments required to reconcile net loss to net cash used in operating activities: | ||
Acquired in-process research and development | 5,691,000 | |
Depreciation | 1,351,000 | 1,351,000 |
Stock-based compensation | 4,271,000 | 46,000 |
Non-cash interest expense | 918,000 | 1,013,000 |
Change in fair value of derivative liability | (1,117,000) | (1,724,000) |
Loss on sale of assets (Note 6) | 663,000 | 145,000 |
Amortization of premiums of available-for-sale securities | 33,000 | |
Changes in operating assets and liabilities: | ||
Other non-cash adjustments, net | 918,000 | 1,013,000 |
Accounts payable and accrued liabilities | (1,374,000) | 144,000 |
Accrued compensation | (853,000) | |
Deferred rent and lease liabilities, net | (310,000) | (287,000) |
Prepaid expenses and other current assets | 348,000 | (337,000) |
Net cash used in operating activities | (15,582,000) | (10,627,000) |
Investing activities: | ||
Purchases of available-for-sale securities | (3,392,000) | |
Proceeds from sales and maturities of available-for-sale securities | 13,016,000 | |
Purchases of property and equipment | (224,000) | (875,000) |
Proceeds from sale of property and equipment | 93,000 | 65,000 |
Cash acquired in reverse merger transaction | 3,008,000 | |
Net cash provided by investing activities | 2,877,000 | 8,814,000 |
Financing activities: | ||
Payment of deferred consideration for asset acquisition | (1,000,000) | |
Proceeds from sale of common stock, net of offering costs | 9,975,000 | |
Net cash provided by financing activities | 8,975,000 | |
Net increase (decrease) in cash, cash equivalents and restricted cash | (3,730,000) | (1,813,000) |
Cash, cash equivalents and restricted cash, beginning of period | 10,463,000 | 12,276,000 |
Cash, cash equivalents and restricted cash, end of period | 6,733,000 | 10,463,000 |
Supplemental schedule of non-cash investing and financing activities: | ||
Issuance of common stock in reverse merger transaction | 10,709,000 | |
Conversion of deferred asset acquisition consideration upon reverse merger | 1,463,000 | |
Property and equipment included in accounts payable | 36,000 | $ 113,000 |
Unpaid offering costs | $ 116,000 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Reconciliation) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Reconciliation of cash, cash equivalents, and restricted cash | |||
Cash and cash equivalents | $ 6,033,000 | $ 9,663,000 | |
Restricted cash | 700,000 | 800,000 | |
Cash, cash equivalents and restricted cash | $ 6,733,000 | $ 10,463,000 | $ 12,276,000 |
Organization and Description of
Organization and Description of the Business | 12 Months Ended |
Dec. 31, 2019 | |
Organization and Description of the Business [Abstract] | |
Organization and Description of the Business | 1. Organization and Description of the Business Armata Pharmaceuticals, Inc. (“Armata”, and together with its subsidiaries referred to herein as, the “Company”) is a clinical-stage biotechnology company focused on the development of precisely targeted bacteriophage therapeutics for the treatment of antibiotic-resistant infections using its proprietary bacteriophage-based technology. The Company was created as a result of a business combination between C3J Therapeutics, Inc. (“C3J”) and AmpliPhi Biosciences Corporation (“AmpliPhi”) that closed on May 9, 2019, where Ceres Merger Sub, Inc., a wholly owned subsidiary of AmpliPhi, merged with and into C3J (the ”Merger”), with C3J surviving the Merger as a wholly owned subsidiary of AmpliPhi. In the Merger, each share of C3J common stock outstanding immediately prior to the Merger was converted into the right to receive approximately .6906 shares of AmpliPhi common stock. The shares were then adjusted further to account for a reverse split of AmpliPhi common stock at a reverse split ratio of 1‑for‑14. All share and per share amounts have been retrospectively adjusted to give effect to the exchange of C3J common stock and the reverse split of AmpliPhi common stock. Immediately prior to the closing of the Merger, AmpliPhi changed its name to Armata Pharmaceuticals, Inc. Armata’s common stock is traded on the NYSE American exchange under the ticker symbol “ARMP.” Immediately following the Merger, certain existing C3J shareholders purchased $10.0 million in Armata common stock. After the Merger and such concurrent private placement, the former C3J security holders owned approximately 76% of the aggregate number of shares of Armata’s common stock and the security holders of AmpliPhi as of immediately prior to the Merger owned approximately 24% of the aggregate number of shares of Armata’s common stock. In addition, upon closing of the Merger, five of the seven members of the board of directors were appointed by C3J. In connection with the Merger, C3J was considered the accounting acquirer of AmpliPhi because C3J’s shareholders retained a majority control of ownership of the Company subsequent to the Merger. In addition, the seven-member board of directors of the combined company include five members established by C3J. Therefore, the historical financial statements presented herein prior to the closing of the Merger are the historical financial statements of C3J. C3J’s predecessor, C3 Jian, Inc., was incorporated under the laws of the State of California on November 4, 2005. On February 26, 2016, as part of a reorganization transaction, C3 Jian, Inc. merged with a wholly owned subsidiary of C3J, and as part of this process, C3 Jian, Inc. was converted to a limited liability company organized under the laws of the State of California named C3 Jian, LLC. Prior to the Merger, C3J was privately held and was financed principally through a series of equity financings. |
Liquidity
Liquidity | 12 Months Ended |
Dec. 31, 2019 | |
Liquidity [Abstract] | |
Liquidity | 2. Liquidity The Company has prepared its 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 and has negative operating cash flows. 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. As of December 31, 2019, the Company had cash and cash equivalents of $6.0 million. On January 27, 2020, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with Innoviva, Inc. (“Innoviva”), pursuant to which the Company agreed to issue and sell to Innoviva, in a private placement, up to 8,710,800 newly issued shares of common stock of the Company and warrants to purchase up to 8,710,800 shares of common stock, with an exercise price per share of $2.87 (the “Private Placement”). Each share of common stock is sold together with one common warrant (collectively, a “Common Unit”), and the per Common Unit purchase price was $2.87. The Private Placement will be completed in two separate closings, with the first closing completed in February 2020, raising gross proceeds of $2.8 million, and the second closing for additional gross proceeds of $22.2 million is expected to be completed following shareholder approval at a meeting scheduled on March 26, 2020. While management believes this plan to raise additional funds will alleviate the conditions that raise substantial doubt, these plans are not entirely within its control and cannot be assessed as being probable of occurring. The Company may not be able to secure additional financing in a timely manner or on favorable terms, if at all. Considering the Company’s current cash resources, management believes the Company’s existing cash resources plus the proceeds expected to be raised in the Private Placement, will be sufficient to fund the Company’s planned operations into the second quarter of 2021. For the foreseeable future, the Company’s ability to continue its operations is dependent upon its ability to obtain additional capital. Management plans to raise additional capital through equity offerings, debt financings, or other capital sources, including potential collaborations, licenses and other similar arrangements. While management believes this plan to raise additional funds will alleviate the conditions that raise substantial doubt, these plans are not entirely within its control and cannot be assessed as being probable of occurring. The Company’s ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, financial markets in the United States and worldwide resulting from the ongoing COVID-19 pandemic. The Company may not be able to secure additional financing in a timely manner or on favorable terms, if at all. Furthermore, if the Company issues equity securities to raise additional funds, its existing stockholders may experience dilution, and the new equity securities may have rights, preferences and privileges senior to those of the Company’s existing stockholders. If the Company raises additional funds through collaboration, licensing or other similar arrangements, it may be necessary to relinquish valuable rights to its potential products on terms that are not favorable to the Company. If the Company is unable to raise capital when needed or on attractive terms, it would be forced to delay, reduce or eliminate its research and development programs or other operations. If any of these events occur, the Company’s ability to achieve the development and commercialization goals would be adversely affected. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Significant Accounting Policies [Abstract] | |
Significant Accounting Policies | 3. Significant Accounting Policies Basis of Presentation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries including C3J, Biocontrol Limited and AmpliPhi Australia Pty Ltd. As described in more details in Note 6, on December 5, 2019, the Company disposed 100% of its ownership interest in AmpliPhi Biotehnološke Raziskave in Razvoj d.o.o. to an independent third party. Results of operations of AmpliPhi Biotehnološke Raziskave were included in the consolidated statements of operations from the Merger close date of May 9, 2019 through an agreed closing date in the fourth quarter in 2019. All significant intercompany accounts and transactions have been eliminated. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the amounts reported in its consolidated financial statements and accompanying notes. On an ongoing basis, management evaluates these estimates and judgments, which are based on historical and anticipated results and trends and on various other assumptions that management believes to be reasonable under the circumstances. By their nature, estimates are subject to an inherent degree of uncertainty and, as such, actual results may differ from management’s estimates. Cash and Cash Equivalents Cash and cash equivalents consist primarily of deposits with commercial banks and financial institutions. Fair Value of Financial Instruments Property and Equipment Property and equipment are recorded at cost and depreciated over their estimated useful lives using the straight-line method. Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed to operations as incurred. Upon disposal, retirement, or sale of an asset, the related cost and accumulated depreciation is removed from the accounts and any resulting gain or loss is included in the results of operations. Estimated useful lives for property and equipment are as follows: Estimated Useful Lives Laboratory equipment 5 – 10 years Office and computer equipment 3 – 5 years Leasehold improvements Shorter of lease term or useful life Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment when events or changes in circumstances indicate the carrying value of the assets may not be recoverable. Recoverability is measured by comparison of the book values of the assets to future net undiscounted cash flows that the assets or the asset groups are expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the book value of the assets exceed their fair value, which is measured based on the estimated discounted future net cash flows arising from the assets or asset groups. No impairment losses on long-lived assets have been recorded through December 31, 2019. In-Process Research and Development (“IPR&D” and Acquired IPR&D) IPR&D assets are intangible assets with indefinite lives and are not subject to amortization. The Company’s IPR&D assets represent a capitalized in-process bacteriophage development programs for S. aureus infections that the Company acquired through the Merger. Such assets are initially measured at their acquisition-date fair values and are subject to impairment testing at least annually until completion or abandonment of research and development efforts associated with the projects. Upon successful completion of each project, the Company makes a determination as to the then remaining useful life of the intangible asset and begins amortization. The Company tests IPR&D assets for impairment as of December 31 of each year or more frequently if indicators of impairment are present. The authoritative accounting guidance provides an optional qualitative assessment for any indicators that indefinite-lived intangible assets are impaired. If it is determined that it is more likely than not that the indefinite-lived intangible assets, including IPR&D, are impaired, the fair value of the indefinite-lived intangible assets is compared with the carrying amount and impairment is recorded for any excess of the carrying amount over the fair value of the indefinite-lived intangible assets. If and when a quantitative analysis of IPR&D assets is required based on the result of the optional qualitative assessment, the estimated fair value of IPR&D assets is calculated based on the income approach, which includes discounting expected future net cash flows associated with the assets to a net present value. The fair value measurements utilized to perform the impairment analysis are categorized within Level 3 of the fair value hierarchy. Significant management judgment is required in the forecast of future operating results that are used in the Company’s impairment analysis. The estimates the Company uses are consistent with the plans and estimates that it uses to manage its business. Significant assumptions utilized in the Company’s income approach model include the timing of clinical studies and regulatory approvals, the probability of success of its research and development programs, timing of commercialization of these programs, forecasted sales, gross margin, selling, general and administrative expenses, capital expenditures, as well as anticipated growth rates. During the fourth quarter ended December 31, 2019, the Company performed the annual evaluation of its IPR&D assets for impairment. The Company considered the development timelines for its S. aureus development program and noted no qualitative factors that would indicate potential impairment of its IPR&D asset. In addition, the Company performed a quantitative analysis of the fair value of its S. aureus phage program as of December 31, 2019, using a net present value model of projected income and expenses and a discount rate of 17.3%. Based on this analysis, the fair value of this phage program was greater than its carrying value as of December 31, 2019. Consequently, no impairment was noted for the IPR&D asset. The Company expenses acquired IPR&D in connection with an asset acquisition when there is no alterative future use. Acquired IPR&D expense of $6.8 million for the year ended December 31, 2018 consists of the estimated fair value of the assets acquired and consideration given in connection with the acquisition of certain synthetic phage assets in 2018 from Synthetic Genomics, Inc. (“SGI”). As the assets acquired were in the research and development phase and were determined to not have any alternative future use, it was expensed as acquired IPR&D. Goodwill Goodwill, which has an indefinite useful life, represents the excess of purchase consideration over the fair value of net assets acquired. The Company’s goodwill as of December 31, 2019 is associated with AmpliPhi’s business prior to the Merger. Goodwill is not subject to amortization and is required to be tested for impairment at least on an annual basis. The Company tests goodwill for impairment as of December 31 of each year. The Company determines whether goodwill may be impaired by comparing the carrying value of the single reporting unit, including goodwill, to the fair value of the reporting unit. If the fair value is less than the carrying amount, a more detailed analysis is performed to determine whether goodwill is impaired. The impairment loss, if any, is measured as the excess of the carrying value of the goodwill over the implied fair value of the goodwill and is recorded in the Company’s consolidated statements of operations. There was no impairment of goodwill during the year ended December 31, 2019. Stock-Based Compensation Compensation expense related to stock options granted to employees and non-employees is measured at the grant date based on the estimated fair value of the award and is recognized on the accelerated attribution method over the requisite service period. Forfeitures are recognized as a reduction of stock-based compensation expense as they occur. Stock-based compensation expense for an award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. Foreign Currency Translations and Transactions The functional currency of the Company and its wholly owned subsidiaries is the U.S. dollar. Revenue Recognition The Company recognizes revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. To determine revenue recognition for contracts with customers, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies its performance obligations. At contract inception, the Company assesses the goods or services agreed upon within each contract and assess whether each good or service is distinct and determine those that are performance obligations. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. During the years ended December 31, 2019 and 2018 the company did not recognize revenue or deferred revenue from contracts with customers. Research and Development Costs Research and development (“R&D”) costs consist primarily of direct and allocated salaries, incentive compensation, stock-based compensation and other personnel-related costs, facility costs, and third-party services. Third party services include studies and clinical trials conducted by clinical research organizations. R&D activities are expensed as incurred. The Company records accruals for estimated ongoing clinical trial expenses. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the studies, including the phase or completion of events, invoices received and contracted costs. Judgments and estimates are made in determining the accrued balances at the end of the reporting period. Research and development expenses are partially offset by the benefit of tax incentive payments for qualified research and development expenditures from the Australian tax authority (“AU Tax Rebates”). The Company does not record AU Tax Rebates until payment is received due to the uncertainty of receipt. The Company received AU Tax Rebates of approximately $1.3 million during the year ended December 31, 2019, and such rebates have been recorded as an offset to research and development expense in the Company’s consolidated statements of operations. There was no AU Tax Rebates received in 2018. Income Taxes The Company utilizes the asset and liability method of accounting for income taxes. Deferred income taxes are recognized for the future tax consequences of temporary differences using enacted statutory tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Temporary differences include the differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities and net operating loss and tax credit carryforwards. The effect on deferred taxes of a change in tax rates is recognized in income (expense) in the period that includes the enactment date. The Company evaluates the likelihood that deferred tax assets will be recovered from future taxable income. Valuation allowances are provided if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company’s income tax returns are based on calculations and assumptions that are subject to examination by the Internal Revenue Service and other tax authorities. In addition, the calculation of tax liabilities involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. Derivative Liabilities Derivative liabilities are accounted for in accordance with the applicable accounting guidance provided in ASC 815 – Derivatives and Hedging based on the specific terms of the agreements. Derivative liabilities are recorded at fair value at each reporting period with any change in fair value recognized as a component of change in fair value of asset acquisition derivative liability in the consolidated statements of operations and comprehensive loss. The Company has a zero derivative liability balance at December 31, 2019 as the liability of $1.1 million at December 31, 2018 was settled upon the Merger. Basic and Diluted Net Loss per Share Net earnings or loss per share (“EPS”) is calculated in accordance with the applicable accounting guidance provided in ASC 260, Earnings per Share. Basic EPS is calculated by dividing net income or loss by the weighted-average number of common shares outstanding. Diluted net loss per share is computed in accordance with the treasury stock method and reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted to common stock. The calculation of diluted loss per share requires that, to the extent the average market price of the underlying shares for the reporting period exceeds the exercise price of the warrants, and the presumed exercise of such securities are dilutive to net loss per share for the period, an adjustment to net loss available to common stockholders used in the calculation is required to remove the change in fair value of the warrants from the numerator for the period. Likewise, an adjustment to the denominator is required to reflect the related dilutive shares, if any, under the treasury stock method. Comprehensive Loss Comprehensive loss consists of net loss and other comprehensive income (loss). Other comprehensive income (loss) includes cumulative foreign currency translation adjustments and unrealized gains or losses on the Company’s investments in marketable securities. Recent Accounting Pronouncements Not Yet Adopted In November 2018, FASB issued ASU 2018-18, Clarifying the Interaction between Topic 808 and Topic 606 . The objective of the standard is to clarify the interaction between Topic 808, Collaborative Arrangements , and Topic 606, Revenue from Contracts with Customers . Currently, Topic 808 does not provide comprehensive recognition or measurement guidance for collaborative arrangements, and the accounting for those arrangements is often based on an analogy to other accounting literature or an accounting policy election. Similarly, aspects of Topic 606 have resulted in uncertainty in practice about the effect of the revenue standard and credit loss standard on the accounting for collaborative arrangements. The standard will become effective beginning on January 1, 2020, with early adoption permitted. The Company does not expect adoption of this new guidance will have an impact on its consolidated financial statements and related disclosures. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. The standard amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses for most financial assets and certain other instruments that aren’t measured at fair value through net income. For available-for-sale debt securities, entities will be required to recognize an allowance for credit losses rather than a reduction in carrying value of the asset. Entities will no longer be permitted to consider the length of time that fair value has been less than amortized cost when evaluating when credit losses should be recognized. This new guidance is effective for calendar-year smaller reporting public entities in the first quarter of 2023. The Company is currently evaluating the impact of this ASU and does not expect that adoption of this standard will have a material impact on its consolidated financial statements and related disclosures. In December 2019, the FASB issued ASU 2019-12, Income Taxes (“ASC 740”) , which simplifies the accounting for income taxes by eliminating certain exceptions to the guidance in ASC 740 related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The new guidance also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The guidance is effective for calendar-year public business entities in 2021 and interim periods within that year. Early adoption is permitted. The Company does not expect adoption of this new guidance will have a material impact on its consolidated financial statements and related disclosures . Recently Adopted Accounting Standards In February 2016, the FASB issued ASU No. 2016‑02, Leases (Topic 842) , which amends the FASB Accounting Standards Codification and creates Topic 842, "Leases." The new topic supersedes Topic 840, "Leases," and increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and requires disclosures of key information about leasing arrangements. The Company adopted ASU 2016‑02 retrospectively at January 1, 2019 using a simplified transition option that allows companies to initially apply the new lease standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings or accumulated deficit. The Company also elected to adopt the package of practical expedients permitted in ASC Topic 842. Accordingly, the Company continues to account for its existing operating lease as an operating lease under the new guidance, without reassessing whether the agreements contain a lease under ASC 842. All of the Company’s leases at the adoption date were operating leases for facilities and did not include any non-lease components. As a result of the adoption of ASU 2016‑02, on January 1, 2019 the Company recognized (i) a lease liability of approximately $3.8 million, which represents the present value of the Company’s remaining lease payments using an estimated incremental borrowing rate of 15%, and (ii) a right-of-use asset of approximately $2.7 million. There was no cumulative-effect adjustment to accumulated deficit. Lease expense is not expected to change materially as a result of the adoption of ASU 2016‑02. In June 2018, the FASB issued ASU No. 2018‑07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting , which amends the FASB Accounting Standards Codification in order to simplify the accounting for share-based payments granted to nonemployees for goods and services. Under the ASU, most of the guidance on such payments to nonemployees will be aligned with the requirements for share-based payments granted to employees. The guidance mandates the modified retrospective approach and is effective for annual and interim reporting periods beginning after December 31, 2018, with early adoption permitted. The Company elected to early adopt this ASU as of June 30, 2018 and the adoption did not have an impact on the Company’s consolidated financial statements. |
Fair Value of Financial Assets
Fair Value of Financial Assets and Liabilities – Derivative Instruments | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value of Financial Assets and Liabilities – Derivative Instruments [Abstract] | |
Fair Value Measurements | 4. Fair Value of Financial Assets and Liabilities – Derivative Instruments The guidance regarding fair value measurements prioritizes the inputs used in measuring fair value and establishes a three-tier value hierarchy that distinguishes among the following: · Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. · Level 2—Valuations based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and models for which all significant inputs are observable, either directly or indirectly. · Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The Company estimates the fair values of derivative liabilities utilizing Level 3 inputs. No derivative liabilities have been transferred between the classification levels. Estimating the fair values of derivative liabilities requires 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. There were no assets or liabilities that require recurring fair value measurements as of December 31, 2019. The recurring fair value measurements of the Company at December 31, 2018 consisted of the following: Quoted Prices in Active Markets Significant Other Significant for Identical Observable Inputs Unobservable Items (Level 1) (Level 2) Inputs (Level 3) Total December 31, 2018 Assets Money market funds $ 9,430,000 $ — $ — $ 9,430,000 Total assets $ 9,430,000 $ — $ — $ 9,430,000 Liabilities Asset acquisition derivative liability $ — $ — $ 1,117,000 $ 1,117,000 Total liabilities $ — $ — $ 1,117,000 $ 1,117,000 The following table sets forth a summary of changes in the fair value of the Company’s derivative liabilities during the year ended December 31, 2019: Asset Acquisition Derivative Liability Balance, December 31, 2018 $ 1,117,000 Changes in estimated fair value (1,117,000) Balance, December 31, 2019 $ — The Company estimated the fair value of this derivative by forecasting the timing and likelihood of the events occurring and discounting the probability adjusted payments using an appropriate discount based on market interest rates and its own non-performance risk as required by ASC 820 – Fair Value Measurement . There is no longer a potential payment requirement associated with the derivative liability subsequent to the Merger. Accordingly, the fair value of the derivative liability was reduced to zero with the associated change recorded in other income. |
The Merger
The Merger | 12 Months Ended |
Dec. 31, 2019 | |
The Merger [Abstract] | |
The Merger | 5. The Merger On May 9, 2019, the Company completed the Merger (see Note 1). On the date of the Merger, AmpliPhi had, and the Company currently has, IPR&D related to the S. aureus development program, a phage product candidate for the treatment of Staphylococcus aureus infections. The product candidate was utilized in clinical applications through single-patient expanded access guidelines established by U.S. and Australian regulatory agencies. Further, AmpliPhi provided a workforce that is considered to have the necessary skills, knowledge, and experience to perform a process, that when applied to IPR&D is critical to the ability to convert it into outputs. Based on this evaluation, the Company determined that the Merger should be accounted for as a business combination pursuant to Financial Accounting Standards Board Accounting Standards Codification Topic 805, Business Combinations (“ASC 805”). In connection with the Merger, the Company allocated the total purchase consideration of $10.7 million in stock to the net assets and liabilities acquired, including identifiable intangible assets and related deferred tax liability, based on their respective fair values at the acquisition date. The Company recognizes deferred tax liabilities for indefinite-lived intangible assets in accordance with ASC 740, Income Taxes. The following table summarizes the allocation of the purchase price to the fair value of the respective assets and liabilities acquired, which was finalized in the quarter ended December 31, 2019. Cash and cash equivalents $ 3,008,000 Prepaid expenses 257,000 Property and equipment 708,000 Right of use asset 271,000 In-process research and development (1) 10,256,000 Total assets 14,500,000 Accounts payable (4,004,000) Other long term liabilities (199,000) Deferred tax liability (3,077,000) Net assets acquired 7,220,000 Purchase price 10,710,000 Goodwill (2) $ 3,490,000 (1) IPR&D relates to a bacteriophage product candidate for the treatment of Staphylococcus aureus infections in patients with bacteremia. The valuation of this asset was prepared by an independent third party based on estimated discounted cash flows based on probability-weighted future development expenditures and revenue streams provided by the Company’s management. (2) Goodwill represents the excess of the purchase price over the valuation of the fair value of tangible and identified intangible assets, less liabilities, acquired. In addition, the Company incurred and expensed costs directly related to the Merger totaling approximately $1.1 million which are included in general and administrative expenses in the consolidated statement of operations and comprehensive loss. Since the closing date of the Merger, the results of AmpliPhi’s operations have been included in the Company’s consolidated financial statements. Selected amounts related to AmpliPhi’s business included in the Company’s consolidated statements of operations from the period of May 9, 2019, the date of the Merger, to December 31, 2019 are summarized in the table below. Amounts show do not include the offset to research and development expenses related to AU Tax rebates discussed in Note 3. Year Ended December 31, 2019 Research and development expenses $ 1,321,000 General and administrative expenses 1,917,000 Sale of Slovenia (Note 6) 663,000 Net loss $ 3,901,000 The unaudited pro forma information in the table below summarizes the combined results of operations of AmpliPhi with those of the Company as though these entities were combined as of January 1, 2018. The results of operations for the year ended December 31, 2019, are based on the unaudited financial statements prepared for the year ended December 31, 2019, and for the year ended December 31, 2018, are based on the Company’s audited financial statements. This unaudited pro forma information is summarized as follows: Year Ended December 31, 2019 2018 Revenue — — Net loss $ (21,335,000) $ (27,818,000) The pro forma financial information as presented above is for informational purposes only and is not indicative of the consolidated results of operations of future periods or the results of operations that would have been achieved assuming the acquisition had taken place on January 1, 2018. |
Loss on Sale of Assets
Loss on Sale of Assets | 12 Months Ended |
Dec. 31, 2019 | |
Loss on Sale of Assets [Abstract] | |
Loss on Sale of Assets | 6. Loss on Sale of Assets The Company produces clinical quantities of each of its bacteriophage product candidates at its GMP-compliant manufacturing facilities. With the completion of the Merger in May 2019, the Company had two manufacturing sites, one in Marina del Rey, California and additionally in Ljubljana, Slovenia. Each manufacturing site had clean rooms, in-use equipment and experienced manufacturing personnel. At the time of the merger, the Company was evaluating its long-term manufacturing needs and both facilities were deemed strategic assets due to the complex nature of the bacteriophage manufacturing process. Following an extensive evaluation and a technology transfer from the Slovenian facility to the Marina del Rey, California location, management determined the Slovenia manufacturing facility was not essential and could exit its operations in Slovenia. The conclusion was reached in September 2019 after considering the monthly expense run rate of Solvenian facility and its location in Europe. On November 8, 2019, the Company entered into an agreement to sell the Slovenia subsidiary to an un-related third-party buyer “Buyer” and on December 6, 2019, the sale transaction was completed. The agreement requires that the Buyer maintain the ability of the Slovenia facility to manufacture the Company’s products. If the Company requires such products, the Buyer and the Company would negotiate a supply agreement governing the purchase and sale of such products. In addition, the Company has the right to repurchase the Slovenian subsidiary’s operations at any point in the five year period immediately following the closing. The Company recognized a loss on sale of assets of $0.7 million, representing the excess of the net assets sold over proceeds received, in the statement of operations and comprehensive loss for the year ended December 31, 2019. |
Net Loss per Share
Net Loss per Share | 12 Months Ended |
Dec. 31, 2019 | |
Net Loss per Share [Abstract] | |
Net Loss per Share | 7. Net Loss per Share Diluted EPS for the year ended December 31, 2019 included a numerator adjustment to remove the gain related to the change in fair value of derivative liabilities $0.9 million, net of interest. Additionally, diluted EPS for the year ended December 31, 2019 included an adjustment to the weighted-average shares outstanding to appropriately weight the 516,976 issuance of shares to SGI as discussed in Note 11. Year Ended December 31, 2019 2018 Basic and diluted net loss per share calculation: Net loss, basic $ (19,479,000) $ (16,702,000) Change in fair value of derivative liabilities, net of interest (938,000) — Net loss, diluted (20,417,000) (16,702,000) Weighted average shares outstanding, basic 7,827,197 4,652,777 Net loss per share, basic $ (2.49) $ (3.59) Weighted average shares outstanding, diluted 8,009,909 4,652,777 Net loss per share, diluted $ (2.55) $ (3.59) The following outstanding securities at December 31, 2019 and 2018 have been excluded from the computation of diluted weighted average shares outstanding for the years ended December 31, 2019 and 2018, as they would have been anti-dilutive: Year Ended December 31, 2019 2018 Options 1,275,380 136,463 Restricted stock awards 343,493 416,856 Warrants 1,854,007 — Total 3,472,880 553,319 |
Balance Sheet Details
Balance Sheet Details | 12 Months Ended |
Dec. 31, 2019 | |
Balance Sheet Details [Abstract] | |
Balance Sheet Details | 8. Balance Sheet Details Property and Equipment, net Property and equipment consisted of the following: December 31, 2019 December 31, 2018 Laboratory equipment $ 6,047,000 $ 6,990,000 Furniture and fixtures 646,000 627,000 Office and computer equipment 323,000 260,000 Leasehold improvements 3,329,000 3,266,000 Total 10,345,000 11,143,000 Less: accumulated depreciation (8,158,000) (7,894,000) Property and equipment, net $ 2,187,000 $ 3,249,000 Depreciation expense totaled $1.4 million for both years ended December 31, 2019 and 2018, respectively. Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities consisted of the following: December 31, 2019 2018 Accounts payable $ 547,000 $ 415,000 Other accrued expenses 731,000 121,000 $ 1,278,000 $ 536,000 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes [Abstract] | |
Income Taxes | 9 . Income Taxes Loss before income taxes consisted of the following components: Year Ended December 31, 2019 2018 United States $ (18,341,000) $ (16,702,000) Foreign (1,138,000) — Total $ (19,479,000) $ (16,702,000) The company has not recognized any current or deferred tax expense on its US and Foreign pre-tax losses for the years ended December 31, 2019 and 2018. The differences between the Company’s effective tax rate and the U.S. federal statutory tax rate were as follows: December 31, 2019 2018 U.S. federal statutory income tax rate 21.0 % 21.0 % Adjustments for tax effects of: State income taxes, net of federal tax 2.6 % 7.0 % Stock-based compensation (0.5) % 0.0 % Change in valuation allowance (22.7) % (28.0) % Net operating loss carryforwards and credit expirations (3.1) % — % Stock issuance costs (1.2) % — % Gain on derivative liability extinguishment 1.2 % — % Slovenia facility sale 1.9 % — % Permanent differences 1.3 % — % Other (0.5) % — % Effective income tax rate 0.0 % 0 % Significant components of the Company’s deferred tax assets and liabilities were as follows: December 31, 2019 2018 Deferred tax assets: Net operating loss carryforwards $ 26,291,000 $ 17,035,000 Capitalized research and development 15,262,000 15,504,000 Deferred consideration — 313,000 Stock-based compensation 1,358,000 934,000 Depreciation and amortization 1,632,000 1,237,000 Lease accounting 801,000 189,000 Other 981,000 906,000 Total deferred tax assets before valuation allowance 46,325,000 36,118,000 Less: valuation allowance (45,670,000) (36,118,000) Total deferred tax assets after valuation allowance 655,000 — Deferred tax liabilities: Right-of-use asset (655,000) — In-process research and development (3,077,000) — Total deferred tax liabilities (3,732,000) — Net deferred tax liability $ (3,077,000) $ — The Company’s net operating loss carryforwards at December 31, 2019 are $88.8 million and $63.5 million for federal and state income tax purposes, respectively. Federal and state net operating loss carryforwards are available to offset future taxable income, if any, and will begin to expire in 2026 to 2028, respectively. The federal NOL’s generated in tax years 2018 and forward will carryforward indefinitely. The ability of the Company to utilize net operating losses carryforwards to reduce future domestic taxable income and domestic income tax is subject to various limitations under the Internal Revenue Code (Code). The utilization of such carryforwards may be limited upon the occurrence of certain ownership changes during any three-year period resulting in an aggregate change of more than 50% in beneficial ownership. As of December 31, 2019, a management does not believe that a more-than‑50% ownership change has occurred. Future equity transactions by the Company, or by 5% of stockholders, could cause a more-than‑50% ownership change and, therefore, trigger a limitation on the annual utilization of net operating losses. The Company has generated federal and state income tax losses in all years since its inception. Accordingly, management has determined that significant negative evidence precludes the Company from recording a net deferred tax asset for financial statement purposes as it is more likely than not that its deferred tax assets will not be realized. The Company files income tax returns in the U.S. federal jurisdiction, state of California and certain foreign jurisdictions. As of December 31, 2019 the Company is no longer subject to U.S. federal income tax examinations for tax years ended on or before December 31, 2013 or to California state income tax examinations for tax years ended on or before December 31, 2012. However, to the extent allowed by law, the tax authorities may have the right to examine prior periods where net operating losses or tax credits were generated and carried forward, and make adjustments up to the amount of the net operating loss or credit carryforward. The Company did not have a liability for unrecognized tax benefits at December 31, 2019 and 2018. The Company’s policy is to classify interest and penalties on uncertain tax positions as a component of tax expense. As of December 31, 2019, the Company has no accrued interest or penalties related to uncertain tax positions. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 10 . Commitments and Contingencies Operating Leases The Company leases office and research and development space under a noncancelable ten-year operating lease in Marina Del Rey, CA. The lease commenced January 1, 2012 with the Company’s option to extend the lease for an additional ten years. First year base rent under the lease was $1.3 million. The annual base rent increases annually by 3% and will be $1.6 million by the end of the lease term. The Company received rent abatement for the first seven months of the lease term and allowance for tenant improvements of $1.5 million. In October 2011, concurrent with the Company’s execution of the lease agreement, an irrevocable letter of credit in the amount of $1.0 million was delivered to the landlord. Starting on January 1, 2017, and each year thereafter until the end of the lease term, the letter of credit will be reduced by $100,000, so that the amount will remain at $500,000 until 2021, the last year of the initial lease term. Future minimum annual lease payments under the Company’s noncancelable operating leases as of December 31, 2019, are as follows: Operating Leases 2020 1,591,000 2021 1,638,000 Total minimum lease payments $ 3,229,000 Less: amount representing interest (366,000) Present value of operating lease obligations 2,863,000 Less: current portion (1,308,000) Noncurrent operating lease obligations 1,555,000 The remaining lease term of the Company’s operating lease is two years, and the discount rate used to calculate the Company’s right of use asset and lease liability is 15%. Rent expense was $1.5 million and $1.4 million for the years ended December 31, 2019 and 2018, respectively. Total cash payments for operating leases as included in the consolidated statements of cash flows during the year ended December 31, 2019 was $1.7 million. License Agreement The Company entered into an exclusive license agreement with The Regents of the University of California (the “Regents”) on April 24, 2007 including amendments for the use of several patents. As part of the license agreement, the Company issued The Regents 10,540 shares of common stock. The Company is required to pay the Regents $5,000 in annual maintenance fees and milestone fees for the first licensed product in both the Human Dental and Human Medical fields of application as follows: 1) filing of an Investigational New Drug application: $20,000; 2) completing a Phase 1 clinical trial: $50,000; 3) completing a Phase 2 clinical trial: $50,000; 4) completing a Phase 3 clinical trial: $150,000; and 5) first commercial sale of a license product: $250,000. Upon the commercial sale of all licensed products from both fields of application, the Company is required to pay royalties to the Regents based on 1% of net sales of nonprescription licensed products and 2% of net sales of prescription licensed products. The Company may grant exclusive or nonexclusive sublicenses to third parties and 20% of sublicensing income received by the Company is to be paid to the Regents. There are also minimum royalties due to The Regents starting with $20,000 payable the first year of sales of a licensed product. The minimum increases by $15,000 each year until reaching a minimum of $50,000 in the third year of sales and thereafter. The term of the license agreement is for the life of the last-to-expire patent. During this term, the Company agrees to diligently meet commercialization milestone goals. Milestones goals include commencing a Phase 3 trial by 2024 and selling a commercialized product by 2027 for a Human Dental product and commencing a Phase 1 trial by 2023 for a Human Medical product. If the Company fails to meet these milestones, the Regents have the right to convert the license agreement for a specific field to a nonexclusive license, or to terminate the license agreement for a specific field. Legal Proceedings From time to time, the Company may be involved in disputes, including litigation, relating to claims arising out of operations in the normal course of business. Any of these claims could subject the Company to costly legal expenses and, while management generally believes that there is adequate insurance to cover many different types of liabilities, the Company’s insurance carriers may deny coverage or policy limits may be inadequate to fully satisfy any damage awards or settlements. If this were to happen, the payment of any such awards could have a material adverse effect on the consolidated results of operations and financial position. Additionally, any such claims, whether or not successful, could damage the Company’s reputation and business. The Company is currently not a party to any legal proceedings, the adverse outcome of which, in management’s opinion, individually or in the aggregate, would have a material adverse effect on its consolidated results of operations or financial position. Between April 15 and April 25, 2019, three putative class action lawsuits (captioned Midgarden v. AmpliPhi Biosciences Corp., et al., No. 19-cv-0684 (S.D. Cal. filed Apr. 15, 2019); Henning v. AmpliPhi Biosciences Corp., et al., No. 19-cv-0728 (S.D. Cal. filed Apr. 19, 2019); and Plumley v. AmpliPhi Biosciences Corp., et al., No. 19-cv-0617 (W.D. Wash. filed Apr. 25, 2019)) were filed in federal court against the Company and its board of directors related to the Merger. The lawsuits assert violations of Section 14(a) of the Securities Exchange Act of 1934 and Rule 14a-9 promulgated thereunder against all defendants, and assert violations of Section 20(a) of the Securities Exchange Act of 1934 as to the individual defendants. The plaintiffs contend that the Company’s Definitive Proxy Statement on Schedule 14A, filed on April 4, 2019 (the “April 2019 Proxy Statement”), omitted or misrepresented material information regarding the Merger. The complaints sought injunctive relief, rescission, or rescissory damages and an award of plaintiffs’ costs, including attorneys’ fees and expenses. On May 1, 2019, the Company amended the April 2019 Proxy Statement to provide additional disclosure to the Company’s stockholders. Each of the above cases have since been dismissed. |
Synthetic Genomics Asset Acquis
Synthetic Genomics Asset Acquisition | 12 Months Ended |
Dec. 31, 2019 | |
Synthetic Genomics Asset Acquisition [Abstract] | |
Synthetic Genomics Asset Acquisition | 11. Synthetic Genomics Asset Acquisition On February 28, 2018, the Company completed an acquisition of certain synthetic phage assets (the “Synthetic Phage Assets Acquisition”) from “SGI” for consideration consisting of $8.0 million in cash and $27.0 million in potential equity. The cash payments consisted of: $1.0 million paid at closing on February 28, 2018, plus an additional $7.0 million following the (the payments due following the closing are collectively the “time-based payment obligation”). The equity payment (the “equity payment” and, together with the time-based payment obligation, the “deferred purchase price arrangement”) was due upon the earlier of the initial public offering of shares of the Company’s common stock pursuant to an effective registration statement under the Securities Act of 1933, as amended, the sale of all or substantially all of the Company’s assets to a third party, or a consolidation or merger into a third party. The agreement provided that the number of shares to be issued or the consideration to be paid will be determined based upon the per share price in connection with an initial public offering, the value of consideration received in a sale of the synthetic phage assets to a third party, or the value of consideration received in a consolidation or merger with a third party. On December 20, 2018, in contemplation of the Merger (see Note 5), the deferred purchase price arrangement was amended. Under the amended agreement, the purchase consideration consisted of (i) closing consideration of $1.0 million already paid on February 28, 2018, (ii) cash payments of $1.0 million on January 31, 2019, $1.0 million on January 31, 2020, and $2.0 million on January 31, 2021, (iii) an issuance of that number of shares of the Company’s common stock equal to ten percent of the Company’s fully-diluted capitalization, excluding options and restricted stock awards, immediately prior to the closing of the Merger, and (iv) potential milestone payments of up to $39.5 million related to the development and relevant regulatory approval of products utilizing bacteriophage from the synthetic phage assets acquired from SGI (the “milestone payment obligation”). In January 2017, FASB issued ASU 2017‑01, Clarifying the Definition of a Business . A key provision within ASU 2017‑01 is the single or similar asset threshold. When substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the acquired set is not a business. The Company adopted this standard effective January 1, 2017. The synthetic phage assets acquired consisted primarily of phage know-how, research program materials and the related intellectual properties that had been under development by SGI. In connection with the SGI transaction, the Company became a party to a collaboration agreement with Merck, and a grant from National Institutes of Health, and the National Institute of Allergy and Infectious Diseases. The Company considered the items included in the acquired synthetic phage assets and concluded that substantially all of the fair value of the assets acquired and consideration given to SGI constituted the purchase of a single asset. Based on ASU 2017‑01, the acquisition was an asset acquisition, specifically an in process research and development asset. Under guidance in ASC 730, in process research and development assets acquired in connection with asset acquisitions are expensed unless there is an alternative future use. As the asset acquired from SGI does not have an alternative future use, the $6.8 million fair value of the asset and consideration transferred for the asset acquired was expensed in full in the consolidated statement of operations and comprehensive loss. The equity payment was determined to be a derivative liability in accordance with ASC 815, Derivatives and Hedging and was initially recorded at its fair value of $2.8 million. Throughout 2018 and until May 9, 2019, the derivative liability was adjusted to its fair value based upon a payment probability assessment and marked-to-market at the end of each period (see Note 4). The time-based payment obligation was recorded as a liability at its amortized cost of $2.9 million and impacted interest expense based on the effective interest method based on its contractual life in accordance with ASC 835, Interest . Following the December 20, 2018 amendment to the deferred purchase price arrangement, the Company considered the probability of the reduction to the share issuance consideration in estimating the fair value of the derivative liability. The Company determined the changes to the deferred purchase price arrangement in December 2018 met the definition of a troubled debt restructuring under ASC 470‑60, Troubled Debt Restructurings by Debtors , as the Company was experiencing financial difficulties and SGI granted a concession. The amendments to the terms of the equity payment resulted in an adjustment to the fair value of the derivative liability, resulting in a $2.0 million gain, which is included in the change in fair values of derivative liabilities within the consolidated statement of operations and comprehensive loss for the year ended December 31, 2018. Other than the gain resulting from the change in fair value of a derivative liability required to be remeasured to fair value with changes in fair value recognized in earnings in accordance with ASC 815, no gain on restructuring was recorded because the future, undiscounted cash flows of the time-based payment obligation exceed the carrying amount of the liability. The net carrying amount at the date of the restructuring did not include any contingently payable amounts. The time-based payment obligations continued to be carried at amortized cost and impact interest expense using the effective interest method based on its contractual life in accordance with ASC 835. Potential payments under the milestone payment obligation will be accrued once probable of being incurred in accordance with ASC 450, Contingencies . For the year ended December 31, 2019 and 2018, the Company recognized $0.9 million and $1.0 million, respectively, of interest expense related to the time-based payment obligations. In connection with the Merger, the Company converted its equity payment obligation to SGI by issuing 516,976 shares of the Company’s common stock in connection with the amended agreement, after considering the Merger exchange ratio and reverse stock split in the manner described above. Through May 9, 2019, the derivative liability associated with the equity payment was updated for its estimated market value. Upon closing of the Merger, the fair value of the derivative liability was estimated at zero as the equity payment is no longer required to be made in the future. The change in fair value is reflected in other income. |
Research Collaboration Arrangem
Research Collaboration Arrangement | 12 Months Ended |
Dec. 31, 2019 | |
Research and Development [Abstract] | |
Research Collaboration Arrangement | 12. Research Collaboration Arrangement In connection with the Synthetic Phage Asset Acquisition discussed in Note 11, the Company was assigned a research collaboration agreement (“Research and Option Agreement”) with Merck. In May 2019, the Research and Option Agreement was amended and extended for four years. During the research term, the Company will be entitled to milestone payments tied to the achievement of product development milestone events in the amount of $1.5 million. The collaboration agreement also provides for the initiation of a second research program should Merck exercise that option during the initial research term and pays the option fee of $1.5 million. To date, Merck has not exercised its license option nor has the Company reached any milestones or earned any revenue under the Research and Option Agreement. Merck has the right to terminate the agreement at any time with 90 days’ notice. Each party to the Research and Option Agreement is responsible for its costs and expenses in connection with the research program. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | 13. Equity The Company is authorized to issue one class of shares designated as “Common Stock”. The number of shares of common stock authorized to be issued is 217,000,000 shares. At December 31, 2019, outstanding warrants to purchase shares of common stock are as follows: Shares Underlying Outstanding Exercise Expiration Warrants Price Date 2,980 $ 1,505.00 March 16, 2020 1,991 $ 567.00 March 31, 2021 597,881 $ 21.00 May 10, 2022 1,249,955 $ 5.60 October 16, 2023 1,200 $ 1,680.00 None 1,854,007 |
Stock-based Compensation
Stock-based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Stock-based Compensation [Abstract] | |
Stock-based Compensation | 14. Stock-based Compensation Stock Award Plans The Company maintains a 2016 Equity Incentive Plan (the “2016 Plan”), which provides for the issuance of incentive share awards in the form of non-qualified and incentive stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards and performance-based stock awards. 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 or to a subsidiary of the Company. The exercise price for stock options must not be less than the fair market value of the underlying shares on the date of grant. Stock options expire no later than ten years from the date of grant and generally vest and typically become exercisable over a four-year period following the date of grant. Upon the exercise of stock options, the Company issues the resulting shares from shares reserved for issuance under the 2016 Plan. Under the 2016 Plan, the number of shares authorized for issuance automatically increases annually beginning January 1, 2017 and through January 1, 2026. The 2016 Plan was most recently amended and restated by the Board of Directors effective as of May 8, 2019 to reflect (i) the name change of AmpliPhi Biosciences Corporation to “Armata Pharmaceuticals, Inc.”, and (ii) the one-for-fourteen reverse stock split. In connection with the Merger, the Company assumed the C3J Jian, Inc. Amended 2006 Stock Option Plan (the “Assumed 2006 Plan”) and the C3J Therapeutics, Inc. 2016 Stock Plan (the “Assumed 2016 Plan”). These plans provided for stock option and restricted stock awards (“RSAs”) to C3J employees in years prior to the Merger with AmpliPhi. The number of shares subject to each outstanding stock option and RSA under those assumed plans, along with the exercise price of stock options, were equitably adjusted pursuant to the terms of the plans to reflect the impact of the Merger and the one-for-fourteen reverse stock split, in each case in a manner intended to preserve the then-current intrinsic value of the awards. No additional awards will be made under either plan. The assumed C3J stock options were substantially vested and expensed as of the merger date. Vesting of the assumed C3J RSAs is based on the occurrence of a public liquidity event, or a change in control. In the event of a public liquidity event, service or milestone based vesting schedules begins. Service periods are generally two to four years. In the event of a change in control, 100% vesting occurs upon the closing of such an event. The merger with AmpliPhi constituted a public liquidity event and triggered the start of vesting of RSAs. Stock-based Compensation The Company estimates the fair value of stock options with performance and service conditions using the Black-Scholes valuation model. Compensation expense related to stock options granted is measured at the grant date based on the estimated fair value of the award and is recognized on the accelerated attribution method over the requisite service period. The assumptions used in the Black-Scholes model for options granted during the year ended December 31, 2019 are presented below: Year ended December 31, 2019 Risk-free interest rate 1.50 to 2.23% Expected volatility 89.26 to 90.43% Expected term (in years) 5.50 to 6.25 Expected dividend yield The risk-free interest rate is based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. Expected volatility is based on an analysis of the historical volatility of Armata and peer companies’ common stock. The expected term represents the period that the Company expects its stock options to be outstanding. The expected term assumption is estimated using the simplified method set forth in the U.S. Securities and Exchange Commission Staff Accounting Bulletin 110, which is the mid-point between the option vesting date and the expiration date. For stock options granted to parties other than employees or directors, the Company elects, on a grant by grant basis, to use the expected term or the contractual term of the option award. The Company has never declared or paid dividends on its common stock and has no plans to do so in the foreseeable future. Forfeitures are recognized as a reduction of stock-based compensation expense as they occur. The tables below summarize the total stock-based compensation expense included in the Company’s consolidated statements of operations for the periods presented: Year Ended December 31, 2019 2018 Research and development $ 872,000 $ 8,000 General and administrative 3,398,000 38,000 Total stock-based compensation $ 4,270,000 $ 46,000 Year Ended December 31, 2019 2018 Expense related to RSA's issued prior to Merger and vesting beginning on Merger closing date $ 2,152,000 $ — Acceleration of RSA expense in connection with executive severance 1,244,000 — Expense related to vesting of stock options issued under the Company's stock plans 874,000 46,000 Total stock-based compensation expense $ 4,270,000 $ 46,000 Stock option transactions during the year ended December 31, 2019 are presented below: Options Outstanding Weighted Average Weighted Remaining Average Contractual Aggregate Exercise Term Intrinsic Shares Price (Years) Value Outstanding at December 31, 2018 136,463 $ 36.31 5.02 — Assumed in the Merger 52,602 56.60 — Granted 1,207,208 3.18 1,569,000 Forfeited/Cancelled (120,893) 15.83 92,000 Outstanding at December 31, 2019 1,275,380 $ 7.61 8.81 1,476,000 Vested and expected to vest at December 31, 2019 1,275,380 $ 7.61 8.81 $ 1,476,000 Exercisable at December 31, 2019 147,097 $ 40.54 4.34 $ — Restricted stock award transactions under the Assumed 2016 Plan during the year ended December 31, 2019 are presented below: Weighted Avg Grant Date Shares Fair Value Outstanding at December 31, 2018 416,856 $ 1.88 Granted — — Forfeited/Cancelled (44,255) 1.29 Issued as Common Stock (29,108) 1.95 Outstanding at December 31, 2019 343,493 $ 1.42 The aggregate intrinsic value of options at December 31, 2019 is based on the Company’s closing stock price on that date of $3.25 per share. As of December 31, 2019, there was $7.4 million of total unrecognized compensation expense related to unvested stock options and RSAs, which the Company expects to recognize over the weighted average remaining period of 2 years. Shares Reserved For Future Issuance As of December 31, 2019, the Company had reserved shares of its common stock for future issuance as follows: Shares Reserved Stock options outstanding 1,275,380 Employee stock purchase plan 5,462 Available for future grants under the 2016 Plan 67,065 Warrants outstanding 1,854,007 Total shares reserved 3,201,914 |
Employee Retirement Plan
Employee Retirement Plan | 12 Months Ended |
Dec. 31, 2019 | |
Employee Retirement Plan [Abstract] | |
Employee Retirement Plan | 15. Employee Retirement Plan The Company’s employees participate in an employee retirement plan under Section 401(k) of the Internal Revenue Code of 1986, as amended. All of the Company’s employees who meet minimum eligibility requirements are eligible to participate in the plan. Matching contributions to the 401(k) plan are made for certain eligible employees to meet non-discrimination provisions of the plan. The Company did not make matching contributions to the 401(k) plan for the years ended December 31, 2019 and 2018. |
Liquidity (Policies)
Liquidity (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Liquidity [Abstract] | |
Liquidity Policy | The Company has prepared its 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 and has negative operating cash flows. 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. As of December 31, 2019, the Company had cash and cash equivalents of $6.0 million. On January 27, 2020, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with Innoviva, Inc. (“Innoviva”), pursuant to which the Company agreed to issue and sell to Innoviva, in a private placement, up to 8,710,800 newly issued shares of common stock of the Company and warrants to purchase up to 8,710,800 shares of common stock, with an exercise price per share of $2.87 (the “Private Placement”). Each share of common stock is sold together with one common warrant (collectively, a “Common Unit”), and the per Common Unit purchase price was $2.87. The Private Placement will be completed in two separate closings, with the first closing completed in February 2020, raising gross proceeds of $2.8 million, and the second closing for additional gross proceeds of $22.2 million is expected to be completed following shareholder approval at a meeting scheduled on March 26, 2020. While management believes this plan to raise additional funds will alleviate the conditions that raise substantial doubt, these plans are not entirely within its control and cannot be assessed as being probable of occurring. The Company may not be able to secure additional financing in a timely manner or on favorable terms, if at all. Considering the Company’s current cash resources, management believes the Company’s existing cash resources plus the proceeds expected to be raised in the Private Placement, will be sufficient to fund the Company’s planned operations into the second quarter of 2021. For the foreseeable future, the Company’s ability to continue its operations is dependent upon its ability to obtain additional capital. Management plans to raise additional capital through equity offerings, debt financings, or other capital sources, including potential collaborations, licenses and other similar arrangements. While management believes this plan to raise additional funds will alleviate the conditions that raise substantial doubt, these plans are not entirely within its control and cannot be assessed as being probable of occurring. The Company’s ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, financial markets in the United States and worldwide resulting from the ongoing COVID-19 pandemic. The Company may not be able to secure additional financing in a timely manner or on favorable terms, if at all. Furthermore, if the Company issues equity securities to raise additional funds, its existing stockholders may experience dilution, and the new equity securities may have rights, preferences and privileges senior to those of the Company’s existing stockholders. If the Company raises additional funds through collaboration, licensing or other similar arrangements, it may be necessary to relinquish valuable rights to its potential products on terms that are not favorable to the Company. If the Company is unable to raise capital when needed or on attractive terms, it would be forced to delay, reduce or eliminate its research and development programs or other operations. If any of these events occur, the Company’s ability to achieve the development and commercialization goals would be adversely affected. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Significant Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries including C3J, Biocontrol Limited and AmpliPhi Australia Pty Ltd. As described in more details in Note 6, on December 5, 2019, the Company disposed 100% of its ownership interest in AmpliPhi Biotehnološke Raziskave in Razvoj d.o.o. to an independent third party. Results of operations of AmpliPhi Biotehnološke Raziskave were included in the consolidated statements of operations from the Merger close date of May 9, 2019 through an agreed closing date in the fourth quarter in 2019. All significant intercompany accounts and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the amounts reported in its consolidated financial statements and accompanying notes. On an ongoing basis, management evaluates these estimates and judgments, which are based on historical and anticipated results and trends and on various other assumptions that management believes to be reasonable under the circumstances. By their nature, estimates are subject to an inherent degree of uncertainty and, as such, actual results may differ from management’s estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist primarily of deposits with commercial banks and financial institutions. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost and depreciated over their estimated useful lives using the straight-line method. Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed to operations as incurred. Upon disposal, retirement, or sale of an asset, the related cost and accumulated depreciation is removed from the accounts and any resulting gain or loss is included in the results of operations. Estimated useful lives for property and equipment are as follows: Estimated Useful Lives Laboratory equipment 5 – 10 years Office and computer equipment 3 – 5 years Leasehold improvements Shorter of lease term or useful life |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment when events or changes in circumstances indicate the carrying value of the assets may not be recoverable. Recoverability is measured by comparison of the book values of the assets to future net undiscounted cash flows that the assets or the asset groups are expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the book value of the assets exceed their fair value, which is measured based on the estimated discounted future net cash flows arising from the assets or asset groups. No impairment losses on long-lived assets have been recorded through December 31, 2019. |
In-Process Research and Development (“IPR&D”) and Acquired IPR&D | In-Process Research and Development (“IPR&D” and Acquired IPR&D) IPR&D assets are intangible assets with indefinite lives and are not subject to amortization. The Company’s IPR&D assets represent a capitalized in-process bacteriophage development programs for S. aureus infections that the Company acquired through the Merger. Such assets are initially measured at their acquisition-date fair values and are subject to impairment testing at least annually until completion or abandonment of research and development efforts associated with the projects. Upon successful completion of each project, the Company makes a determination as to the then remaining useful life of the intangible asset and begins amortization. The Company tests IPR&D assets for impairment as of December 31 of each year or more frequently if indicators of impairment are present. The authoritative accounting guidance provides an optional qualitative assessment for any indicators that indefinite-lived intangible assets are impaired. If it is determined that it is more likely than not that the indefinite-lived intangible assets, including IPR&D, are impaired, the fair value of the indefinite-lived intangible assets is compared with the carrying amount and impairment is recorded for any excess of the carrying amount over the fair value of the indefinite-lived intangible assets. If and when a quantitative analysis of IPR&D assets is required based on the result of the optional qualitative assessment, the estimated fair value of IPR&D assets is calculated based on the income approach, which includes discounting expected future net cash flows associated with the assets to a net present value. The fair value measurements utilized to perform the impairment analysis are categorized within Level 3 of the fair value hierarchy. Significant management judgment is required in the forecast of future operating results that are used in the Company’s impairment analysis. The estimates the Company uses are consistent with the plans and estimates that it uses to manage its business. Significant assumptions utilized in the Company’s income approach model include the timing of clinical studies and regulatory approvals, the probability of success of its research and development programs, timing of commercialization of these programs, forecasted sales, gross margin, selling, general and administrative expenses, capital expenditures, as well as anticipated growth rates. During the fourth quarter ended December 31, 2019, the Company performed the annual evaluation of its IPR&D assets for impairment. The Company considered the development timelines for its S. aureus development program and noted no qualitative factors that would indicate potential impairment of its IPR&D asset. In addition, the Company performed a quantitative analysis of the fair value of its S. aureus phage program as of December 31, 2019, using a net present value model of projected income and expenses and a discount rate of 17.3%. Based on this analysis, the fair value of this phage program was greater than its carrying value as of December 31, 2019. Consequently, no impairment was noted for the IPR&D asset. The Company expenses acquired IPR&D in connection with an asset acquisition when there is no alterative future use. Acquired IPR&D expense of $6.8 million for the year ended December 31, 2018 consists of the estimated fair value of the assets acquired and consideration given in connection with the acquisition of certain synthetic phage assets in 2018 from Synthetic Genomics, Inc. (“SGI”). As the assets acquired were in the research and development phase and were determined to not have any alternative future use, it was expensed as acquired IPR&D. |
Goodwill | Goodwill Goodwill, which has an indefinite useful life, represents the excess of purchase consideration over the fair value of net assets acquired. The Company’s goodwill as of December 31, 2019 is associated with AmpliPhi’s business prior to the Merger. Goodwill is not subject to amortization and is required to be tested for impairment at least on an annual basis. The Company tests goodwill for impairment as of December 31 of each year. The Company determines whether goodwill may be impaired by comparing the carrying value of the single reporting unit, including goodwill, to the fair value of the reporting unit. If the fair value is less than the carrying amount, a more detailed analysis is performed to determine whether goodwill is impaired. The impairment loss, if any, is measured as the excess of the carrying value of the goodwill over the implied fair value of the goodwill and is recorded in the Company’s consolidated statements of operations. There was no impairment of goodwill during the year ended December 31, 2019. |
Stock-Based Compensation | Stock-Based Compensation Compensation expense related to stock options granted to employees and non-employees is measured at the grant date based on the estimated fair value of the award and is recognized on the accelerated attribution method over the requisite service period. Forfeitures are recognized as a reduction of stock-based compensation expense as they occur. Stock-based compensation expense for an award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. |
Foreign Currency Translations and Transactions | Foreign Currency Translations and Transactions The functional currency of the Company and its wholly owned subsidiaries is the U.S. dollar. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. To determine revenue recognition for contracts with customers, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies its performance obligations. At contract inception, the Company assesses the goods or services agreed upon within each contract and assess whether each good or service is distinct and determine those that are performance obligations. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. During the years ended December 31, 2019 and 2018 the company did not recognize revenue or deferred revenue from contracts with customers. |
Research and Development Expenses | Research and Development Costs Research and development (“R&D”) costs consist primarily of direct and allocated salaries, incentive compensation, stock-based compensation and other personnel-related costs, facility costs, and third-party services. Third party services include studies and clinical trials conducted by clinical research organizations. R&D activities are expensed as incurred. The Company records accruals for estimated ongoing clinical trial expenses. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the studies, including the phase or completion of events, invoices received and contracted costs. Judgments and estimates are made in determining the accrued balances at the end of the reporting period. Research and development expenses are partially offset by the benefit of tax incentive payments for qualified research and development expenditures from the Australian tax authority (“AU Tax Rebates”). The Company does not record AU Tax Rebates until payment is received due to the uncertainty of receipt. The Company received AU Tax Rebates of approximately $1.3 million during the year ended December 31, 2019, and such rebates have been recorded as an offset to research and development expense in the Company’s consolidated statements of operations. There was no AU Tax Rebates received in 2018. |
Income Taxes | Income Taxes The Company utilizes the asset and liability method of accounting for income taxes. Deferred income taxes are recognized for the future tax consequences of temporary differences using enacted statutory tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Temporary differences include the differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities and net operating loss and tax credit carryforwards. The effect on deferred taxes of a change in tax rates is recognized in income (expense) in the period that includes the enactment date. The Company evaluates the likelihood that deferred tax assets will be recovered from future taxable income. Valuation allowances are provided if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company’s income tax returns are based on calculations and assumptions that are subject to examination by the Internal Revenue Service and other tax authorities. In addition, the calculation of tax liabilities involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. |
Derivative Liabilities | Derivative Liabilities Derivative liabilities are accounted for in accordance with the applicable accounting guidance provided in ASC 815 – Derivatives and Hedging based on the specific terms of the agreements. Derivative liabilities are recorded at fair value at each reporting period with any change in fair value recognized as a component of change in fair value of asset acquisition derivative liability in the consolidated statements of operations and comprehensive loss. The Company has a zero derivative liability balance at December 31, 2019 as the liability of $1.1 million at December 31, 2018 was settled upon the Merger. |
Basic and Diluted Net Loss per Share | Basic and Diluted Net Loss per Share Net earnings or loss per share (“EPS”) is calculated in accordance with the applicable accounting guidance provided in ASC 260, Earnings per Share. Basic EPS is calculated by dividing net income or loss by the weighted-average number of common shares outstanding. Diluted net loss per share is computed in accordance with the treasury stock method and reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted to common stock. The calculation of diluted loss per share requires that, to the extent the average market price of the underlying shares for the reporting period exceeds the exercise price of the warrants, and the presumed exercise of such securities are dilutive to net loss per share for the period, an adjustment to net loss available to common stockholders used in the calculation is required to remove the change in fair value of the warrants from the numerator for the period. Likewise, an adjustment to the denominator is required to reflect the related dilutive shares, if any, under the treasury stock method. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss consists of net loss and other comprehensive income (loss). Other comprehensive income (loss) includes cumulative foreign currency translation adjustments and unrealized gains or losses on the Company’s investments in marketable securities. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Significant Accounting Policies [Abstract] | |
Antidilutive Securities Excluded from Computation of Diluted Weighted Shares Outstanding | Year Ended December 31, 2019 2018 Basic and diluted net loss per share calculation: Net loss, basic $ (19,479,000) $ (16,702,000) Change in fair value of derivative liabilities, net of interest (938,000) — Net loss, diluted (20,417,000) (16,702,000) Weighted average shares outstanding, basic 7,827,197 4,652,777 Net loss per share, basic $ (2.49) $ (3.59) Weighted average shares outstanding, diluted 8,009,909 4,652,777 Net loss per share, diluted $ (2.55) $ (3.59) The following outstanding securities at December 31, 2019 and 2018 have been excluded from the computation of diluted weighted average shares outstanding for the years ended December 31, 2019 and 2018, as they would have been anti-dilutive: Year Ended December 31, 2019 2018 Options 1,275,380 136,463 Restricted stock awards 343,493 416,856 Warrants 1,854,007 — Total 3,472,880 553,319 |
Useful Lives of Property and Equipment | Estimated useful lives for property and equipment are as follows: Estimated Useful Lives Laboratory equipment 5 – 10 years Office and computer equipment 3 – 5 years Leasehold improvements Shorter of lease term or useful life |
Fair Value of Financial Asset_2
Fair Value of Financial Assets and Liabilities – Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value of Financial Assets and Liabilities – Derivative Instruments [Abstract] | |
Liabilities Measured at Fair Value | There were no assets or liabilities that require recurring fair value measurements as of December 31, 2019. The recurring fair value measurements of the Company at December 31, 2018 consisted of the following: Quoted Prices in Active Markets Significant Other Significant for Identical Observable Inputs Unobservable Items (Level 1) (Level 2) Inputs (Level 3) Total December 31, 2018 Assets Money market funds $ 9,430,000 $ — $ — $ 9,430,000 Total assets $ 9,430,000 $ — $ — $ 9,430,000 Liabilities Asset acquisition derivative liability $ — $ — $ 1,117,000 $ 1,117,000 Total liabilities $ — $ — $ 1,117,000 $ 1,117,000 |
Changes in Fair Value of Derivative Liabilities | The following table sets forth a summary of changes in the fair value of the Company’s derivative liabilities during the year ended December 31, 2019: Asset Acquisition Derivative Liability Balance, December 31, 2018 $ 1,117,000 Changes in estimated fair value (1,117,000) Balance, December 31, 2019 $ — |
The Merger (Tables)
The Merger (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
The Merger [Abstract] | |
Schedule of preliminary allocation of purchase price | The following table summarizes the allocation of the purchase price to the fair value of the respective assets and liabilities acquired, which was finalized in the quarter ended December 31, 2019. Cash and cash equivalents $ 3,008,000 Prepaid expenses 257,000 Property and equipment 708,000 Right of use asset 271,000 In-process research and development (1) 10,256,000 Total assets 14,500,000 Accounts payable (4,004,000) Other long term liabilities (199,000) Deferred tax liability (3,077,000) Net assets acquired 7,220,000 Purchase price 10,710,000 Goodwill (2) $ 3,490,000 (1) IPR&D relates to a bacteriophage product candidate for the treatment of Staphylococcus aureus infections in patients with bacteremia. The valuation of this asset was prepared by an independent third party based on estimated discounted cash flows based on probability-weighted future development expenditures and revenue streams provided by the Company’s management. (2) Goodwill represents the excess of the purchase price over the valuation of the fair value of tangible and identified intangible assets, less liabilities, acquired. |
Schedule of company’s consolidated statement of operations | Selected amounts related to AmpliPhi’s business included in the Company’s consolidated statements of operations from the period of May 9, 2019, the date of the Merger, to December 31, 2019 are summarized in the table below. Amounts show do not include the offset to research and development expenses related to AU Tax rebates discussed in Note 3. Year Ended December 31, 2019 Research and development expenses $ 1,321,000 General and administrative expenses 1,917,000 Sale of Slovenia (Note 6) 663,000 Net loss $ 3,901,000 |
Schedule of unaudited proforma information | The results of operations for the year ended December 31, 2019, are based on the unaudited financial statements prepared for the year ended December 31, 2019, and for the year ended December 31, 2018, are based on the Company’s audited financial statements. This unaudited pro forma information is summarized as follows: Year Ended December 31, 2019 2018 Revenue — — Net loss $ (21,335,000) $ (27,818,000) |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Net Loss per Share [Abstract] | |
Computation of Basic and Diluted Net Loss Per Share | Year Ended December 31, 2019 2018 Basic and diluted net loss per share calculation: Net loss, basic $ (19,479,000) $ (16,702,000) Change in fair value of derivative liabilities, net of interest (938,000) — Net loss, diluted (20,417,000) (16,702,000) Weighted average shares outstanding, basic 7,827,197 4,652,777 Net loss per share, basic $ (2.49) $ (3.59) Weighted average shares outstanding, diluted 8,009,909 4,652,777 Net loss per share, diluted $ (2.55) $ (3.59) |
Antidilutive Securities Excluded from Computation of Diluted Weighted Shares Outstanding | Year Ended December 31, 2019 2018 Basic and diluted net loss per share calculation: Net loss, basic $ (19,479,000) $ (16,702,000) Change in fair value of derivative liabilities, net of interest (938,000) — Net loss, diluted (20,417,000) (16,702,000) Weighted average shares outstanding, basic 7,827,197 4,652,777 Net loss per share, basic $ (2.49) $ (3.59) Weighted average shares outstanding, diluted 8,009,909 4,652,777 Net loss per share, diluted $ (2.55) $ (3.59) The following outstanding securities at December 31, 2019 and 2018 have been excluded from the computation of diluted weighted average shares outstanding for the years ended December 31, 2019 and 2018, as they would have been anti-dilutive: Year Ended December 31, 2019 2018 Options 1,275,380 136,463 Restricted stock awards 343,493 416,856 Warrants 1,854,007 — Total 3,472,880 553,319 |
Balance Sheet Details (Tables)
Balance Sheet Details (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Balance Sheet Details [Abstract] | |
Property and Equipment | Property and equipment consisted of the following: December 31, 2019 December 31, 2018 Laboratory equipment $ 6,047,000 $ 6,990,000 Furniture and fixtures 646,000 627,000 Office and computer equipment 323,000 260,000 Leasehold improvements 3,329,000 3,266,000 Total 10,345,000 11,143,000 Less: accumulated depreciation (8,158,000) (7,894,000) Property and equipment, net $ 2,187,000 $ 3,249,000 |
Accounts Payable and Accrued Liabilities | Accounts payable and accrued liabilities consisted of the following: December 31, 2019 2018 Accounts payable $ 547,000 $ 415,000 Other accrued expenses 731,000 121,000 $ 1,278,000 $ 536,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes [Abstract] | |
(Loss) Income from Continuing Operations Before Income Taxes | Loss before income taxes consisted of the following components: Year Ended December 31, 2019 2018 United States $ (18,341,000) $ (16,702,000) Foreign (1,138,000) — Total $ (19,479,000) $ (16,702,000) The company has not recognized any current or deferred tax expense on its US and Foreign pre-tax losses for the years ended December 31, 2019 and 2018. |
Reconciliation of Statutory to Effective Tax Rates | The company has not recognized any current or deferred tax expense on its US and Foreign pre-tax losses for the years ended December 31, 2019 and 2018. The differences between the Company’s effective tax rate and the U.S. federal statutory tax rate were as follows: December 31, 2019 2018 U.S. federal statutory income tax rate 21.0 % 21.0 % Adjustments for tax effects of: State income taxes, net of federal tax 2.6 % 7.0 % Stock-based compensation (0.5) % 0.0 % Change in valuation allowance (22.7) % (28.0) % Net operating loss carryforwards and credit expirations (3.1) % — % Stock issuance costs (1.2) % — % Gain on derivative liability extinguishment 1.2 % — % Slovenia facility sale 1.9 % — % Permanent differences 1.3 % — % Other (0.5) % — % Effective income tax rate 0.0 % 0 % |
Components of Deferred Tax Assets | Significant components of the Company’s deferred tax assets and liabilities were as follows: December 31, 2019 2018 Deferred tax assets: Net operating loss carryforwards $ 26,291,000 $ 17,035,000 Capitalized research and development 15,262,000 15,504,000 Deferred consideration — 313,000 Stock-based compensation 1,358,000 934,000 Depreciation and amortization 1,632,000 1,237,000 Lease accounting 801,000 189,000 Other 981,000 906,000 Total deferred tax assets before valuation allowance 46,325,000 36,118,000 Less: valuation allowance (45,670,000) (36,118,000) Total deferred tax assets after valuation allowance 655,000 — Deferred tax liabilities: Right-of-use asset (655,000) — In-process research and development (3,077,000) — Total deferred tax liabilities (3,732,000) — Net deferred tax liability $ (3,077,000) $ — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies [Abstract] | |
Future Minimum Lease Payments | Operating Leases 2020 1,591,000 2021 1,638,000 Total minimum lease payments $ 3,229,000 Less: amount representing interest (366,000) Present value of operating lease obligations 2,863,000 Less: current portion (1,308,000) Noncurrent operating lease obligations 1,555,000 |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Summary of Warrant Information | At December 31, 2019, outstanding warrants to purchase shares of common stock are as follows: Shares Underlying Outstanding Exercise Expiration Warrants Price Date 2,980 $ 1,505.00 March 16, 2020 1,991 $ 567.00 March 31, 2021 597,881 $ 21.00 May 10, 2022 1,249,955 $ 5.60 October 16, 2023 1,200 $ 1,680.00 None 1,854,007 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stock-based Compensation [Abstract] | |
Assumptions used in the black-Scholes model | Year ended December 31, 2019 Risk-free interest rate 1.50 to 2.23% Expected volatility 89.26 to 90.43% Expected term (in years) 5.50 to 6.25 Expected dividend yield |
Allocation of Stock-Based Compensation Expenses | Year Ended December 31, 2019 2018 Research and development $ 872,000 $ 8,000 General and administrative 3,398,000 38,000 Total stock-based compensation $ 4,270,000 $ 46,000 Year Ended December 31, 2019 2018 Expense related to RSA's issued prior to Merger and vesting beginning on Merger closing date $ 2,152,000 $ — Acceleration of RSA expense in connection with executive severance 1,244,000 — Expense related to vesting of stock options issued under the Company's stock plans 874,000 46,000 Total stock-based compensation expense $ 4,270,000 $ 46,000 |
Summary of Stock Option Activity | Options Outstanding Weighted Average Weighted Remaining Average Contractual Aggregate Exercise Term Intrinsic Shares Price (Years) Value Outstanding at December 31, 2018 136,463 $ 36.31 5.02 — Assumed in the Merger 52,602 56.60 — Granted 1,207,208 3.18 1,569,000 Forfeited/Cancelled (120,893) 15.83 92,000 Outstanding at December 31, 2019 1,275,380 $ 7.61 8.81 1,476,000 Vested and expected to vest at December 31, 2019 1,275,380 $ 7.61 8.81 $ 1,476,000 Exercisable at December 31, 2019 147,097 $ 40.54 4.34 $ — |
Schedule of restricted stock awards | Weighted Avg Grant Date Shares Fair Value Outstanding at December 31, 2018 416,856 $ 1.88 Granted — — Forfeited/Cancelled (44,255) 1.29 Issued as Common Stock (29,108) 1.95 Outstanding at December 31, 2019 343,493 $ 1.42 |
Shares Reserved for Future Issuance | Shares Reserved Stock options outstanding 1,275,380 Employee stock purchase plan 5,462 Available for future grants under the 2016 Plan 67,065 Warrants outstanding 1,854,007 Total shares reserved 3,201,914 |
Organization and Description _2
Organization and Description of the Business (Details) $ in Millions | May 09, 2019USD ($)shares | Dec. 31, 2019 |
Number of shares issued per common stock outstanding | shares | 0.6906 | |
Reverse stock split ratio | 0.0714 | 0.0714 |
Anticipated purchase of common shares upon completion of merger | $ | $ 10 | |
Percentage of ownership | 76.00% | |
AmpliPhi Biosciences Corporation [Member] | ||
Percentage of ownership | 24.00% |
Liquidity (Narrative) (Details)
Liquidity (Narrative) (Details) - USD ($) | Mar. 26, 2020 | Feb. 29, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Cash and cash equivalents | $ 6,033,000 | $ 9,663,000 | ||
Liquidity, management evaluation | On January 27, 2020, the Company entered into a securities purchase agreement (the "Securities Purchase Agreement") with Innoviva, Inc. ("Innoviva"), pursuant to which the Company agreed to issue and sell to Innoviva, in a private placement, up to 8,710,800 newly issued shares of common stock of the Company and warrants to purchase up to 8,710,800 shares of common stock, with an exercise price per share of $2.87 (the "Private Placement"). Each share of common stock is sold together with one common warrant (collectively, a "Common Unit"), and the per Common Unit purchase price was $2.87. The Private Placement will be completed in two separate closings, with the first closing completed in February 2020, raising gross proceeds of $2.8 million, and the second closing for additional gross proceeds of $22.2 million is expected to be completed following shareholder approval at a meeting scheduled on March 26, 2020. While management believes this plan to raise additional funds will alleviate the conditions that raise substantial doubt, these plans are not entirely within its control and cannot be assessed as being probable of occurring. The Company may not be able to secure additional financing in a timely manner or on favorable terms, if at all.Considering the Company's current cash resources, management believes the Company's existing cash resources plus the proceeds expected to be raised in the Private Placement, will be sufficient to fund the Company's planned operations into the second quarter of 2021. | |||
Securities Purchase Agreement [Member] | Subsequent Event [Member] | ||||
Proceeds from Issuance of Private Placement | $ 22,200,000 | $ 2,800,000 | ||
Securities Purchase Agreement [Member] | Common Stock Subject to Mandatory Redemption [Member] | ||||
Shares Issued, Price Per Share | $ 2.87 | |||
Stock Issued During Period, Shares, New Issues | 8,710,800 | |||
Securities Purchase Agreement [Member] | Warrants and Rights Subject to Mandatory Redemption [Member] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 8,710,800 |
Significant Accounting Polici_4
Significant Accounting Policies (Narrative) (Details) | May 09, 2019USD ($) | Jan. 01, 2019USD ($) | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 05, 2019 |
Impairment of long-lived assets | $ 0 | ||||
Acquired IPR&D expense | $ 5,691,000 | ||||
Impairment of in-process research and development | 0 | ||||
Unrecognized tax benefits | $ 0 | $ 0 | |||
Conversion ratio of reverse stock split | 0.0714 | 0.0714 | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |||
Common stock, shares authorized | shares | 217,000,000 | 217,000,000 | |||
Derivative liability, fair value | $ 2,900,000 | $ 1,117,000 | |||
Lease liability | $ 2,863,000 | ||||
Right-of-use asset | 2,028,000 | ||||
Goodwill, Impairment Loss | $ 0 | ||||
Armata Biotehnološke Raziskave in Razvoj d o o [Member] | |||||
Percentage of ownership sold | 100.00% | ||||
Measurement Input, Discount Rate [Member] | |||||
IPR&D measurement input | 17.3 | ||||
Australian Taxation Office [Member] | |||||
Tax rebates received | $ 1,300,000 | ||||
Accounting Standards Update 2016-02 [Member] | |||||
Estimated incremental borrowing rate (as a percent) | 15.00% | ||||
Accounting Standards Update 2016-02 [Member] | Restatement Adjustment [Member] | |||||
Lease liability | $ 3,800,000 | ||||
Right-of-use asset | 2,700,000 | ||||
Cumulative effect on accumulated deficit | $ 0 |
Significant Accounting Polici_5
Significant Accounting Policies (Antidilutive Shares Excluded from Computation of Diluted Shares Outstanding) (Details) - shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted weighted shares outstanding | 3,472,880 | 553,319 |
Stock Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted weighted shares outstanding | 1,275,380 | 136,463 |
Restricted Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted weighted shares outstanding | 343,493 | 416,856 |
Warrant Liability [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted weighted shares outstanding | 1,854,007 |
Significant Accounting Polici_6
Significant Accounting Policies (Useful Lives of Property and Equipment) (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | Shorter of lease term or useful life |
Minimum [Member] | Laboratory Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Minimum [Member] | Office and Computer Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Maximum [Member] | Laboratory Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 10 years |
Maximum [Member] | Office and Computer Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Fair Value of Financial Asset_3
Fair Value of Financial Assets and Liabilities – Derivative Instruments (Fair Value of Financial Liabilities Measured on Recurring Basis) (Details) - USD ($) | May 09, 2019 | Dec. 31, 2018 |
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Total assets | $ 9,430,000 | |
Asset acquisition derivative liability | $ 2,900,000 | 1,117,000 |
Total liabilities | 1,117,000 | |
June 2016 Offering Liability [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Asset acquisition derivative liability | 1,117,000 | |
Fair Value, Inputs, Level 1 [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Total assets | 9,430,000 | |
Total liabilities | ||
Fair Value, Inputs, Level 1 [Member] | June 2016 Offering Liability [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Asset acquisition derivative liability | ||
Fair Value, Inputs, Level 2 [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Total assets | ||
Total liabilities | ||
Fair Value, Inputs, Level 2 [Member] | June 2016 Offering Liability [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Asset acquisition derivative liability | ||
Fair Value, Inputs, Level 3 [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Total assets | ||
Total liabilities | 1,117,000 | |
Fair Value, Inputs, Level 3 [Member] | June 2016 Offering Liability [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Asset acquisition derivative liability | 1,117,000 | |
Money Market Funds [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Money market funds | 9,430,000 | |
Money Market Funds [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Money market funds | 9,430,000 | |
Money Market Funds [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Money market funds | ||
Money Market Funds [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Schedule Of Derivative Liabilities At Fair Value [Line Items] | ||
Money market funds |
Fair Value of Financial Asset_4
Fair Value of Financial Assets and Liabilities - Derivative Instruments (Change in Fair Value of Derivative Liabilities) (Details) - June 2016 Offering Liability [Member] | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Derivatives And Fair Value [Line Items] | |
Balance, derivative liability | $ 1,117,000 |
Changes in estimated fair value | (1,117,000) |
Balance, derivative liability |
The Merger (Narrative) (Details
The Merger (Narrative) (Details) - AmpliPhi Biosciences Corporation [Member] - USD ($) | May 09, 2019 | Dec. 31, 2019 |
Purchase price | $ 10,710,000 | |
Business combination, acquisition related costs | $ 1,100,000 |
The Merger (Schedule of prelimi
The Merger (Schedule of preliminary allocation of purchase price) (Details) | Dec. 31, 2019USD ($) |
Preliminary allocation of purchase price: | |
Goodwill | $ 3,490,000 |
AmpliPhi Biosciences Corporation [Member] | |
Preliminary allocation of purchase price: | |
Cash and cash equivalents | 3,008,000 |
Prepaid expenses | 257,000 |
Property and equipment | 708,000 |
Right of use asset | 271,000 |
In-process research and development | 10,256,000 |
Total assets | 14,500,000 |
Accounts payable | (4,004,000) |
Other long term liabilities | (199,000) |
Deferred tax liability | (3,077,000) |
Net assets acquired | 7,220,000 |
Purchase price | 10,710,000 |
Goodwill | $ 3,490,000 |
The Merger (Schedule of company
The Merger (Schedule of company’s consolidated statement of operations and unaudited proforma information) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Business Acquisition [Line Items] | ||
Research and development expenses | $ 9,824,000 | $ 8,372,000 |
General and administrative expenses | 9,265,000 | 2,519,000 |
Sale of Slovenia (Note 6) | 663,000 | |
Net loss | (19,479,000) | (16,702,000) |
Business Acquisition, Pro Forma Information [Abstract] | ||
Net loss | (21,335,000) | $ (27,818,000) |
AmpliPhi Biosciences Corporation [Member] | ||
Business Acquisition [Line Items] | ||
Research and development expenses | 1,321,000 | |
General and administrative expenses | 1,917,000 | |
Sale of Slovenia (Note 6) | 663,000 | |
Net loss | $ 3,901,000 |
Loss on Sale of Assets (Narrati
Loss on Sale of Assets (Narrative) (Details) | 1 Months Ended | 12 Months Ended |
May 31, 2019site | Dec. 31, 2019USD ($) | |
Loss on Sale of Assets [Abstract] | ||
Number of manufacturing sites | site | 2 | |
Loss on sale of assets (Note 6) | $ | $ 663,000 |
Net Loss Per Share (Narrative)
Net Loss Per Share (Narrative) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($)shares | |
Significant Accounting Policies [Abstract] | |
Change in fair value of derivative liabilities, net of interest | $ | $ (938) |
Adjustment to weighted-average shares outstanding | shares | 516,976 |
Net Loss Per Share (Computation
Net Loss Per Share (Computation of Basic and Diluted Net Loss Per Share) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Significant Accounting Policies [Abstract] | ||
Net loss | $ (19,479,000) | $ (16,702,000) |
Net loss basic | (19,479,000) | (16,702,000) |
Change in fair value of derivative liabilities, net of interest | (938,000) | |
Net loss, diluted | $ (20,417,000) | $ (16,702,000) |
Weighted average shares outstanding, basic | 7,827,197 | 4,652,777 |
Net loss per share, basic | $ (2.49) | $ (3.59) |
Weighted average shares outstanding, diluted | 8,009,909 | 4,652,777 |
Net loss per share, diluted | $ (2.55) | $ (3.59) |
Net Loss Per Share (Antidilutiv
Net Loss Per Share (Antidilutive Shares Excluded from Computation of Diluted Shares Outstanding) (Details) - shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted weighted shares outstanding | 3,472,880 | 553,319 |
Stock Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted weighted shares outstanding | 1,275,380 | 136,463 |
Restricted Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted weighted shares outstanding | 343,493 | 416,856 |
Warrant Liability [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted weighted shares outstanding | 1,854,007 |
Balance Sheet Details (Narrativ
Balance Sheet Details (Narrative) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Balance Sheet Details [Abstract] | ||
Depreciation | $ 1,351,000 | $ 1,351,000 |
Balance Sheet Details (Property
Balance Sheet Details (Property and Equipment) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 10,345,000 | $ 11,143,000 |
Less: accumulated depreciation | (8,158,000) | (7,894,000) |
Property and equipment, net | 2,187,000 | 3,249,000 |
Laboratory Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 6,047,000 | 6,990,000 |
Office and Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 323,000 | 260,000 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 646,000 | 627,000 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 3,329,000 | $ 3,266,000 |
Balance Sheet Details (Accounts
Balance Sheet Details (Accounts Payable and Accrued Liabilities) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Balance Sheet Details [Abstract] | ||
Accounts payable | $ 547,000 | $ 415,000 |
Other accrued expenses | 731,000 | 121,000 |
Accounts Payable and Accrued Liabilities, Current, Total | $ 1,278,000 | $ 536,000 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Impairment of in-process research and development | $ 0 | |
Unrecognized tax benefits | 0 | $ 0 |
Interest and penalties pertaining to income tax examination recognized | $ 0 | |
U.S. federal statutory income tax rate | 21.00% | 21.00% |
Current tax expense on US and Foreign pre tax losses | $ 0 | $ 0 |
Deferred tax expense on US and Foreign pre tax losses | 0 | 0 |
Domestic Tax Authority [Member] | ||
Net operating loss carryforwards ("NOLs") | $ 88,800,000 | |
State and Local Jurisdiction [Member] | ||
Net operating loss carryforwards ("NOLs") | $ 63,500,000 |
Income Taxes ((Loss) Income fro
Income Taxes ((Loss) Income from Continuing Operations Before Income Taxes) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Taxes [Abstract] | ||
United States | $ (18,341,000) | $ (16,702,000) |
Foreign | (1,138,000) | |
Loss before income taxes | $ (19,479,000) | $ (16,702,000) |
Income Taxes (Reconciliation of
Income Taxes (Reconciliation of Statutory to Effective Income Tax Rate) (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Taxes [Abstract] | ||
U.S. federal statutory income tax rate | 21.00% | 21.00% |
State income taxes, net of federal tax | 2.60% | 7.00% |
Stock-based compensation | (0.50%) | 0.00% |
Change in valuation allowance | (22.70%) | (28.00%) |
Net operating loss carryforwards and credit expirations | (3.10%) | |
Stock issuance costs | (1.20%) | |
Gain on derivative liability extinguishment | 1.20% | |
Slovenia facility sale | 1.90% | |
Permanent differences | 1.30% | |
Other | (0.50%) | |
Effective income tax rate | 0.00% | 0.00% |
Income Taxes (Components of Def
Income Taxes (Components of Deferred Tax Assets) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred Tax Assets, Net [Abstract] | ||
Net operating loss carry-forwards | $ 26,291,000 | $ 17,035,000 |
Capitalized research and development | 15,262,000 | 15,504,000 |
Deferred consideration | 313,000 | |
Stock-based compensation | 1,358,000 | 934,000 |
Depreciation and amortization | 1,632,000 | 1,237,000 |
Lease accounting | 801,000 | 189,000 |
Other | 981,000 | 906,000 |
Total deferred tax assets before valuation allowance | 46,325,000 | 36,118,000 |
Less: valuation allowance | (45,670,000) | (36,118,000) |
Total deferred tax assets after valuation allowance | 655,000 | $ 0 |
Deferred Tax Liabilities, Net [Abstract] | ||
Right-of-use asset | (655,000) | |
In-process research and development | (3,077,000) | |
Total deferred tax liabilities | 3,732,000 | |
Net deferred tax liability | $ (3,077,000) |
Commitments and Contingencies_2
Commitments and Contingencies (Narrative) (Details) - USD ($) | Jan. 01, 2012 | Dec. 31, 2019 | Dec. 31, 2018 | Oct. 31, 2011 |
Operating lease term | 10 years | |||
Operating lease base rent | $ 1,300,000 | |||
Annual increase in rent percentage | 3.00% | |||
Base rent at the end of lease term | $ 1,600,000 | |||
Period of lease and rental abatement credit | 7 months | |||
Lease and rental abatement credit | $ 1,500,000 | |||
Operating lease remaining lease term | 2 years | |||
Operating lease discount rate | 15.00% | |||
Rent expenses operating lease | $ 1,400,000 | |||
Rent expense under operating leases | $ 1,500,000 | |||
Cash payments for operating leases | $ 1,700,000 | |||
Letter of Credit [Member] | ||||
Short-term Debt | $ 1,000,000 | |||
Short term borrowings reduction amount each subsequent year | 100,000 | |||
Minimal amount of short term borrowing, end of lease | $ 500,000 |
Commitments and Contingencies_3
Commitments and Contingencies (Future Minimum Lease Payments) (Details) | Dec. 31, 2019USD ($) |
Commitments and Contingencies [Abstract] | |
2020 | $ 1,591,000 |
2021 | 1,638,000 |
Total minimum lease payments | 3,229,000 |
Less: amount representing interest | (366,000) |
Operating Lease, Liability, Total | 2,863,000 |
Less: current portion | (1,308,000) |
Noncurrent operating lease obligations | $ 1,555,000 |
Commitments and Contingencies_4
Commitments and Contingencies (License Agreement) (Details) | 12 Months Ended |
Dec. 31, 2018USD ($)shares | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Minimum royalties payable | $ 50,000 |
Prescription Licensed Products [Member] | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Percentage of royalty payable | 2.00% |
License Agreement With Regents Of University Of California [Member] | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | shares | 10,540 |
Annual maintenance fees and milestone fees | $ 5,000 |
Filing fees payabe | 20,000 |
Phase 1 clinical trial payment | 50,000 |
Phase 2 clinical trial payment | 50,000 |
Phase 3 clinical trail payment | 150,000 |
Payment on sale of license product | 250,000 |
Minimum royalties payable in first year | 20,000 |
Minimum increase in royalty payable | $ 15,000 |
License Agreement With Regents Of University Of California [Member] | Nonprescription Licensed Products [Member] | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Percentage of royalty payable | 1.00% |
Synthetic Genomics Asset Acqu_2
Synthetic Genomics Asset Acquisition (Details) - USD ($) | Jan. 31, 2021 | Jan. 31, 2020 | May 09, 2019 | Feb. 28, 2019 | Jan. 31, 2019 | Dec. 20, 2018 | Feb. 28, 2018 | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Cash paid for productive assets | $ 8,000,000 | ||||||||
Cash paid acquisition of assets | $ 7,000,000 | $ 1,000,000 | 1,000,000 | ||||||
Issuance of common stock and conversion of deferred consideration for asset acquisition | $ 27,000,000 | $ 1,462,000 | |||||||
Maximum potential milestone payments | $ 39,500,000 | ||||||||
Derivative liability, fair value | $ 2,900,000 | $ 1,117,000 | |||||||
Gain on derivative liability | $ 2,000,000 | 1,117,000 | 1,724,000 | ||||||
Interest expense | $ 931,000 | 1,013,000 | |||||||
Derivative liability related to asset acquisition | 2,800,000 | ||||||||
Acquired IPR&D expense | $ 6,767,000 | ||||||||
Forecast [Member] | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Cash paid acquisition of assets | $ 2,000,000 | $ 1,000,000 | |||||||
Synthetic Genomics Inc [Member] | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Conversion of Stock, Shares Converted | 516,976 |
Research Collaboration Arrang_2
Research Collaboration Arrangement (Narrative) (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Research and Development [Abstract] | |
Revenue expected milestone receivable amount | $ 1.5 |
Agreement option fee amount | $ 1.5 |
Equity (Narrative) (Details)
Equity (Narrative) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Equity [Abstract] | ||
Common stock, shares authorized | 217,000,000 | 217,000,000 |
Proceeds from issuance of common stock | $ 9,975,000 |
Equity (Summary of Warrants Out
Equity (Summary of Warrants Outstanding) (Details) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Warrants | 1,854,007 |
Exercise Price $1,505.00 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Warrants | 2,980 |
Exercise Price | $ / shares | $ 1,505 |
Warrant Expiration Date | Mar. 16, 2020 |
Exercise Price $567.00 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Warrants | 1,991 |
Exercise Price | $ / shares | $ 567 |
Warrant Expiration Date | Mar. 31, 2021 |
Exercise Price $21.00 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Warrants | 597,881 |
Exercise Price | $ / shares | $ 21 |
Warrant Expiration Date | May 10, 2022 |
Exercise Price $5.60 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Warrants | 1,249,955 |
Exercise Price | $ / shares | $ 5.60 |
Warrant Expiration Date | Oct. 16, 2023 |
Exercise Price $1,680.00 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Warrants | 1,200 |
Exercise Price | $ / shares | $ 1,680 |
Stock-based Compensation (Narra
Stock-based Compensation (Narrative) (Details) $ / shares in Units, $ in Millions | May 09, 2019 | Dec. 31, 2019USD ($)$ / sharesshares |
Reverse stock split ratio | 0.0714 | 0.0714 |
Vesting percentage | 100.00% | |
Assumed 2006 and 2016 Plan [Member] | ||
Reverse stock split ratio | 0.0714 | |
Additional awards | shares | 0 | |
Minimum [Member] | Assumed 2006 and 2016 Plan [Member] | ||
Expiration period of share-based payment award | 2 years | |
Maximum [Member] | Assumed 2006 and 2016 Plan [Member] | ||
Expiration period of share-based payment award | 4 years | |
Stock Option [Member] | ||
Common stock closing price | $ / shares | $ 3.25 | |
Unrecognized compensation cost related to unvested options | $ | $ 7.4 | |
Weighted-average remaining period for recognition of compensation costs related to unvested options | 2 years | |
Equity Incentive Plan 2016 [Member] | ||
Expiration period of share-based payment award | 10 years | |
Vesting period of share-based compensation award | 4 years |
Stock-based Compensation (Assum
Stock-based Compensation (Assumptions Used in the Black-Scholes Model) (Details) - Common Stock Options [Member] | Dec. 31, 2019USD ($) |
Measurement Input, Expected Dividend Rate [Member] | |
Fair value input, equity securities | 0 |
Minimum [Member] | Measurement Input, Risk Free Interest Rate [Member] | |
Fair value input, equity securities | 1.50 |
Minimum [Member] | Measurement Input, Price Volatility [Member] | |
Fair value input, equity securities | 89.26 |
Minimum [Member] | Measurement Input, Expected Dividend Rate [Member] | |
Fair value input, equity securities | 5.50 |
Maximum [Member] | Measurement Input, Risk Free Interest Rate [Member] | |
Fair value input, equity securities | 2.23 |
Maximum [Member] | Measurement Input, Price Volatility [Member] | |
Fair value input, equity securities | 90.43 |
Maximum [Member] | Measurement Input, Expected Term [Member] | |
Fair value input, equity securities | 6.25 |
Stock-based Compensation (Alloc
Stock-based Compensation (Allocation of Stock-Based Compensation Expense) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Total stock-based compensation expense | $ 4,270,000 | $ 46,000 |
Research and development expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Total stock-based compensation expense | 872,000 | 8,000 |
General and administrative expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Total stock-based compensation expense | 3,398,000 | 38,000 |
Restricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Acceleration of RSA expense in connection with executive severance | 1,244,000 | |
Total stock-based compensation expense | 2,152,000 | |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Total stock-based compensation expense | $ 874,000 | $ 46,000 |
Stock-based Compensation (Summa
Stock-based Compensation (Summary of Stock Option Activity) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Stock-based Compensation [Abstract] | ||
Shares, Balance Beginning | 136,463 | |
Assumed in the Merger (in shares) | 52,602 | |
Shares, Granted | 1,207,208 | |
Shares, Forfeited | (120,893) | |
Shares, Balance Ending | 1,275,380 | 136,463 |
Shares, Vested or expected to vest at December 31, 2019 | 1,275,380 | |
Shares, Exercisable at December 31, 2019 | 147,097 | |
Weighted Average Exercise Price, Outstanding Beginning | $ 36.31 | |
Assumed in the Merger (in dollars per share) | 56.60 | |
Weighted Average Exercise Price, Granted | 3.18 | |
Weighted Average Exercise Price, Forfeited | 15.83 | |
Weighted Average Exercise Price, Outstanding Ending | 7.61 | $ 36.31 |
Weighted Average Exercise Price, Vested or expected to vest at December 31, 2019 | 7.61 | |
Weighted Average Exercise Price, Exercisable at December 31, 2019 | $ 40.54 | |
Average Remaining Contractual Term (Years), Outstanding | 8 years 9 months 22 days | 5 years 7 days |
Average Remaining Contractual Term (Years), Vested or expected to vest at December 31, 2019 | 8 years 9 months 22 days | |
Average Remaining Contractual Term (Years), Exercisable at December 31, 2019 | 4 years 4 months 2 days | |
Intrinsic Value, granted | $ 1,569,000 | |
Intrinsic Value, forfeited | 92,000 | |
Intrinsic Value, Outstanding Ending | 1,476,000 | |
Intrinsic Value, Vested or expected to vest at December 31, 2019 | $ 1,476,000 |
Stock-based Compensation (Restr
Stock-based Compensation (Restricted stock award) (Details) - Restricted Stock [Member] - C3J Stock Plan 2016 [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Shares | ||
Forfeited/Cancelled (in shares) | (44,255) | |
Issued as Common Stock | (29,108) | 416,856 |
Outstanding at end of period (in shares) | 343,493 | |
Weighted Avg Grant Date Fair Value | ||
Forfeited/Cancelled (in dollars per share) | $ 1.29 | |
Issued as Common Stock | 1.95 | $ 1.88 |
Outstanding at end of period (in dollars per share) | $ 1.42 |
Stock-based Compensation (Share
Stock-based Compensation (Shares Reserved for Future Issuance) (Details) - shares | Dec. 31, 2019 | Dec. 31, 2018 |
Stock options outstanding | 1,275,380 | 136,463 |
Employee stock purchase plan | 5,462 | |
Warrants | 1,854,007 | |
Total shares reserved | 3,201,914 | |
Equity Incentive Plan 2016 [Member] | ||
Available for future grants under the 2016 Plan | 67,065 |