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Share Name | Share Symbol | Market | Type |
---|---|---|---|
AzurRx BioPharma Inc | NASDAQ:AZRX | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 3.45 | 3.41 | 3.51 | 0 | 01:00:00 |
Prospectus
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Filed pursuant to Rule 424(b)(3)
Registration No. 333-252087
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PROSPECTUS
SUMMARY
This summary highlights
information contained elsewhere in this prospectus. This summary
does not contain all of the information that you should consider
before deciding to invest in our securities. You should read this
entire prospectus carefully, including the “Risk
Factors” section in this prospectus and under similar
captions in the documents incorporated by reference into this
prospectus. In this prospectus, unless otherwise stated or the
context otherwise requires, references to “AzurRx”,
“Company”, “we”, “us”,
“our” or similar references mean AzurRx BioPharma, Inc.
and its subsidiaries on a consolidated basis. References to
“AzurRx BioPharma” refer to AzurRx BioPharma, Inc. on
an unconsolidated basis. References to “AzurRx SAS”
refer to AzurRx SAS, AzurRx BioPharma’s wholly-owned
subsidiary through which we conduct our European
operations.
Overview
We
are engaged in the research and development of targeted,
non-systemic therapies for the treatment of patients with
gastrointestinal (“GI”) diseases. Non-systemic
therapies are non-absorbable drugs that act locally, i.e. the
intestinal lumen, skin or mucosa, without reaching an
individual’s systemic circulation.
We
are currently focused on developing our pipeline of three
gut-restricted GI clinical drug candidates. The lead therapeutic
candidate is MS1819, a recombinant lipase for the treatment of
exocrine pancreatic insufficiency (“EPI”) in patients
with cystic fibrosis and chronic pancreatitis, currently in
two Phase 2 clinical trials. We plan to launch two clinical
programs using proprietary formulations of niclosamide, a
pro-inflammatory pathway inhibitor; FW-420, for grade 1 Immune
Checkpoint Inhibitor-Associated Colitis (“ICI-AC”) and
diarrhea in oncology patients and FW-1022, for Severe Acute
Respiratory Syndrome Coronavirus 2 (“COVID-19” or
“COVID”) gastrointestinal infections. Each drug
candidate is described below:
MS1819
MS1819 is a recombinant lipase enzyme for the
treatment of exocrine pancreatic insufficiency (“EPI”)
associated with cystic fibrosis (“CF”) and chronic
pancreatitis (“CP”). MS1819, supplied as an oral
non-systemic biologic capsule, is derived from
the Yarrowia
lipolytica yeast lipase
and breaks up fat molecules in the digestive tract of EPI patients
so that they can be absorbed as nutrients. Unlike the standard of
care, the MS1819 synthetic lipase does not contain any animal
products.
EPI
is a condition characterized by deficiency of the
exocrine pancreatic enzymes, resulting in a
patient’s inability to digest food properly, or maldigestion.
The deficiency in this enzyme can be responsible for greasy
diarrhea, fecal urge and weight loss. There are more than 30,000
patients with EPI caused by CF according to the Cystic Fibrosis
Foundation approximately and approximately 90,000 patients in the
U.S. with EPI caused by CP according to the National Pancreas
Foundation. Patients are currently treated with porcine pancreatic
enzyme replacement pills (“PERT”).
MS1819 – Phase 2b OPTION 2 Cystic Fibrosis Monotherapy
Studies
On October 17, 2019, we announced that the Cystic
Fibrosis Foundation Data Safety Monitoring Board (the “CFF
DSMB”) completed its review of our final results of the
OPTION Cross-Over Study and had found no safety concerns for
MS1819, and that the CFF DSMB supported our plan to proceed to a
higher 4.4 gram dose of MS1819 with enteric capsules in the
multi-center dose escalation Phase 2b OPTION clinical trial (the
“OPTION 2 Trial”). In December 2019, the Company
submitted the clinical trial protocol to the existing IND at the
FDA. The clinical trial protocol has been reviewed by the FDA with
no comments. In April 2020, the Company received approval to
conduct the OPTION 2 Trial in Therapeutics Development Network
(“TDN”) clinical sites in the U.S. as well as
Institutional Review Board (“IRB”) approval to commence the OPTION 2
Trial.
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The OPTION 2 Trial is designed to investigate the
safety, tolerability and efficacy of MS1819 (2.2 gram and 4.4 gram
doses in enteric capsules) in a head-to-head manner versus the
current standard of care, porcine pancreatic enzyme replacement
therapy (“PERT”) pills. The OPTION 2 Trial will be an
open-label, crossover study, conducted in 15 sites in the
U.S. and Europe. A total of 30 CF patients 18 years or
older will be enrolled. MS1819 will be administered in
enteric capsules to provide gastric protection and allow optimal
delivery of enzyme to the duodenum. Patients will first be
randomized into two cohorts: to either the MS1819 arm, where they
receive a 2.2 gram daily oral dose of MS1819 for three weeks; or to
the PERT arm, where they receive their pre-study dose of PERT pills
for three weeks. After three weeks, stools will be collected for
analysis of coefficient of fat absorption (“CFA”). Patients will then be crossed
over for another three weeks of the alternative treatment. After
three weeks of cross-over therapy, stools will again be collected
for analysis of CFA. A parallel group of patients will be
randomized and studied in the same fashion, using a 4.4 gram daily
dose of MS1819. All patients will be followed for an
additional two weeks after completing both crossover treatments for
post study safety observation. Patients will be assessed using
descriptive methods for efficacy, comparing CFA between MS1819 and
PERT arms, and for safety.
We initiated
the OPTION 2 Trial in July 2020 with the first patient screened and
three clinical trial sites activated in the U.S. In August 2020,
the Company dosed the first patients and initiated the European arm
of the OPTION 2 Trial. Topline data is anticipated in the first
quarter of 2021; however, this timeline may be further delayed due
to the COVID-19 pandemic.
In November 2020, we submitted a protocol amendment for the OPTION
2 Trial to add a study arm that uses an immediate release MS1819
capsule to compare data from the existing arm, that uses
delayed-release enteric capsules with data from the new arm, that
uses immediate release capsules, in order to determine the optimal
dose and delivery method. We plan to initiate the OPTION 2 study
extension in early first quarter 2021.
MS1819 – Phase 2 Combination Therapy Study
In
addition to the monotherapy studies, we launched a Phase 2
multi-center clinical trial (the “Combination Trial”)
in Europe to investigate MS1819 in combination with PERT, for CF
patients who suffer from severe EPI but continue to experience
clinical symptoms of fat malabsorption despite taking the maximum
daily dose of PERTs. The Combination Trial is designed to
investigate the safety, tolerability and efficacy of escalating
doses of MS1819 (700 mg, 1120 mg and 2240 mg per day,
respectively), in conjunction with a stable dose of PERTs, in order
to increase CFA and relieve abdominal symptoms in uncontrolled CF
patients. A combination therapy of PERT and MS1819 has the
potential to: (i) correct macronutrient and micronutrient
maldigestion; (ii) eliminate abdominal symptoms attributable to
maldigestion; and (iii) sustain optimal nutritional status on a
normal diet in CF patients with severe EPI.
We
dosed the first patients in its Combination Trial in Hungary in
October 2019. Planned enrollment is expected to include
approximately 24 CF patients with severe EPI, at clinical trial
sites in Hungary and additional countries in Europe, including
Turkey. Topline data is currently expected in the first half of
2021; however, this timeline may be further delayed due to the
COVID-19 pandemic.
We
announced positive interim data on the first five patients in the
Combination Trial in August 2020. The primary efficacy endpoint was
met, with CFAs greater than 80% for all patients across all visits.
For secondary efficacy endpoints, we observed that stool weight
decreased, the number of stools per day decreased, steatorrhea
improved, and body weight increased. Additionally, no serious
adverse events were reported.
We
opened a total of five clinical sites for the Combination
Trial in Turkey in October 2020 and announced that its first
patients were dosed in November 2020. We currently have a
total of nine of the expected ten sites in Europe active and
recruiting patients.
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We
do not expect to generate revenue from drug candidates that we
develop until we obtain approval for one or more of such drug
candidates and commercialize our product or enter into a
collaborative agreement with a third party. We do not have any
products approved for sale at the present and have never generated
revenue from product sale.
Recent Developments
License Agreement with First Wave Bio, Inc.
On
December 31, 2020, we entered into a License Agreement (the
“First Wave License Agreement”) with First Wave Bio,
Inc. (“First Wave”). Pursuant to the First Wave License
Agreement, First Wave granted us a worldwide, exclusive right to
develop, manufacture, and commercialize First Wave’s
proprietary immediate release and enema formulations of niclosamide
for the fields of treating ICI-AC and COVID in humans (the
“Product”). The Product uses First Wave’s
proprietary formulations of niclosamide, a pro-inflammatory pathway
inhibitor. We plan to commence in 2021 both a Phase 2 trial of the
Product for COVID in GI and a Phase 1b/2a trial for
ICI-AC.
In
consideration of the license and other rights granted by First
Wave, we paid First Wave a $9.0 million upfront cash payment and
are obligated to make an additional payment of $1.25 million due on
June 30, 2021. In addition, we are obligated to pay potential
milestone payments to First Wave totaling up to $37.0 million for
each indication, based upon the achievement of specified
development and regulatory milestones. Under the First Wave License
Agreement we are obligated to pay First Wave royalties as a
mid-single digit percentage of net sales of the Product, subject to
specified reductions.
In
addition,
on January 8, 2021, pursuant to the First Wave License Agreement we
entered into a securities purchase agreement with First Wave (the
“First Wave Purchase Agreement”) pursuant to which we
issued to First Wave, on that same day, 3,290.1960 shares of Series
C Preferred Stock, initially convertible into an aggregate of
3,290,196 shares of Common Stock, at an initial stated value of
$750.00 per share and a conversion price of $0.75 per share, which
was the equivalent of $3.0 million based upon the volume weighted
average price of our Common Stock for the five-day period
immediately preceding the date of the First Wave License Agreement,
or $0.9118 per share. The First Wave Purchase Agreement contains
demand and piggyback registration rights with respect to the Common
Stock issuable upon conversion.
Pursuant
to the First Wave Purchase Agreement, the shares of Series C
Preferred Stock issued to First Wave are not convertible prior to
the Stockholder Approval.
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Registered Direct Offering and Private Placement
On
December 31, 2020, we entered into a securities purchase agreement
(the “Series C Purchase Agreement”) with the selling
stockholder named herein, pursuant to which we agreed to sell in
the Registered Direct Offering 5,333.333 shares of Series C
Preferred Stock, at a price of $750 per share, initially
convertible into an aggregate of 5,333,334 shares of Common Stock,
which is equivalent to the Issuable Maximum, at an initial stated
value of $750.00 per share and a conversion price of $0.75 per
share. The Registered Direct Offering closed on January 6,
2020.
Upon
the closing of the Registered Direct Offering, the selling
stockholder converted all of its Series C Preferred Stock issued in
the Registered Direct Offering, effective immediately upon the
closing. Upon such conversion, in lieu of the issuance of shares of
Common Stock, the Series C Certificate of Designation provides for
the issuance of Pre-funded Warrants to purchase shares of Common
Stock, with an exercise price of $0.001 per share and no expiration
term, if necessary to comply with the Beneficial Ownership
Limitation contained therein. Accordingly, the investor received
upon the closing of the Registered Direct Offering, an aggregate of
3,400,000 shares of Common stock and Pre-funded Warrants to
purchase up to 1,933,334 shares of Common stock.
Concurrently
with the Registered Direct Offering, in the Private Placement
pursuant to the Series C Purchase Agreement, we also sold to the
selling stockholder named herein, an additional 5,333.333 shares of
Series C Preferred Stock at the same price as the Series C
Preferred Stock offered in the Registered Direct Offering, which
shares are convertible into an aggregate of 5,333,334 shares of our
Common stock, together with Investor Warrants to purchase up to an
aggregate of 10,666,668 shares of Common Stock, with an exercise
price of $0.80 per share and an expiration term of five and a half
years from the date of issuance. The Private Placement closed on
January 6, 2020.
The
aggregate gross proceeds from the Offerings, excluding the net
proceeds, if any, from the exercise of the Investor Warrants, were
$8.0 million and we estimate that the net proceeds will be
approximately $6.8 million. We intend to use the net proceeds from
the Offerings to fund the payment of the cash consideration payable
to First Wave under the First Wave License Agreement, and for other
general corporate purposes.
Until we
have obtained the Stockholder Approval, we may not issue, upon
conversion of the Series C Preferred Stock and certain related
transactions, a number of shares of Common Stock which would exceed
6,186,966 shares of Common Stock in the aggregate, which amount is
equal to the Issuable Maximum. The Issuable Maximum shall be
applied collectively, when any conversions of Series C Preferred
Stock are aggregated together with all shares of Common Stock
issuable upon conversion or exchange of any securities issued in
certain transactions related to the Offerings, including (i) any
shares of Series C Preferred Stock issued to First Wave as
consideration for the First Wave License Agreement, (ii) any
warrants issued as compensation to the placement agent in the
Offerings and (iii) any securities issuable to holders of the
Exchange Rights (as defined and further described below) as a
result of the Offerings. Any conversions of Series C Preferred
Stock will be processed in the order in which we receive such
conversion request from the holders of Series C Preferred Stock,
and not on a pro rata basis. As a result of the conversion,
immediately upon consummation of the Registered Direct Offering, of
5,333.3333 shares of Series C Preferred Stock into Common Stock and
Pre-funded Warrants, 853,632 shares of Common Stock remained
available for issuance below the Issuable Maximum as of January 11,
2021.
Upon
receipt of the Stockholder Approval, we anticipate to convert
immediately all shares of Series C Preferred Stock into shares of
Common Stock (or Pre-Funded Warrants, as applicable).
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In
connection with the Offerings, we issued to H.C. Wainwright &
Co. LLC (“Wainwright”) and its designees certain
warrants (the “Placement Agent Warrants”) exercisable
for up to 746,667 shares of Common Stock, which is equal to 7.0% of
the amount determined by dividing the gross proceeds of the
Offerings by the offering price per share of Common Stock, or
$0.75. The Placement Agent Warrants have substantially the same
terms as the Investor Warrants, except an exercise price of
$0.9375, or 125% of the per share price of the Series C Preferred
Stock issued in the Offerings. The Placement Agent Warrants are not
exercisable until the Stockholder Approval is
obtained.
Pursuant
to the Series C Purchase Agreement, we must hold a meeting of our
stockholders not later than March 31, 2021 to seek such approval as
may be required from our stockholders, in accordance with
applicable law, the applicable rules and regulations of the Nasdaq
Stock Market, our certificate of incorporation and bylaws and the
General Corporate Law of the State of Delaware with respect to the
issuance of shares of Common Stock upon conversion or exercise of
the Series C Preferred Stock and the Warrants sold in the Private
Placement and the related transactions described herein, including
(x) an increase in the number of authorized shares of Common Stock
above 150,000,000 and (y) the potential issuance of shares of
Common Stock in excess of the Issuable Maximum. We have scheduled a
special meeting (the “Special Meeting”) of our
stockholders to be held on February 24, 2021 at 9:00 A.M., Eastern
Time in order to obtain the Stockholder Approval. Only holders of
record of our Common Stock as of the close of business on January
4, 2021 are entitled to notice of and to vote at the Special
Meeting.
The
terms of the Offerings were previously reported in our Current
Reports on Form 8-K filed on January 4, 2021 and January 8,
2021.
Registration Rights Agreement
In
connection with the Offerings, we entered into a registration
rights agreement, dated as of December 31, 2020 (the
“Registration Rights Agreement”), with the selling
stockholder, pursuant to which we undertook to file, within 30 days
following the closing of the Offerings, this registration statement
to register the shares of Common Stock issuable upon (i) the
conversion of the Series C Preferred Stock sold in the Private
Placement, (ii) the exercise of the Investor Warrants sold in the
Private Placement and (iii) the exercise of any Pre-funded Warrants
issued or issuable upon the conversion of the Series C Preferred
Stock sold in the Private Placement (collectively, the
“Registrable Securities”). We are filing this
registration statement, of which this prospectus forms a part, to
register the resale of the Registerable Securities by the selling
stockholder named herein in compliance with our obligations under
the Registration Rights Agreement.
Corporate Information
We were
incorporated on January 30, 2014 in the State of
Delaware. In June 2014, we acquired 100% of the issued
and outstanding capital stock of AzurRx SAS. Our principal
executive offices are located at 1615 South Congress Avenue, Suite
103, Delray Beach, Florida 33445. Our telephone number is (646)
699-7855. We maintain a website at www.azurrx.com. The information
contained on our website is not, and should not be interpreted to
be, a part of this prospectus.
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THE
OFFERING
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Securities
to be Offered by the Selling Stockholder
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Up
to
16,000,002 shares of Common Stock issuable upon conversion of the
Series C Preferred Stock (or Pre-funded Warrants, as applicable)
and exercise of the Investor Warrants.
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Use of
Proceeds
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The
Common Stock to be offered and sold using this prospectus will be
offered and sold by the selling stockholder named in this
prospectus. Accordingly, we will not receive any proceeds from any
sale of shares of our Common Stock in this offering. A portion
of the shares covered by this prospectus may be issued upon
exercise of the Warrants. Upon any cash exercise of the
Warrants, the selling stockholder will pay us the applicable
exercise price. We anticipate that proceeds that we receive from
the cash exercise of such warrants, if any, will be used for
working capital and general corporate purposes, including, without
limitation, development of our product candidates, and general and
administrative expenses. It is possible that, pending their use, we
may invest the net proceeds in a way that does not yield a
favorable, or any, return for us. See the section entitled
“Use of Proceeds” in this prospectus.
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Risk
Factors
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You
should read the section entitled “Risk Factors” in this
prospectus for a discussion of the factors to consider carefully
before deciding to invest in shares of our Common
Stock.
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Nasdaq
Capital Market Symbol
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Our
Common Stock is listed on the Nasdaq Capital Market under the
symbol “AZRX.”
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●
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US10,292,951;
US10,772,854; US10,744,103; US10,799,468; US10,849,867; and U.S.
Patent Application Publications US20200197339; US20200197340 and
US20200276140 as well as corresponding worldwide patent filings all
entitled “Methods and Compositions for Treating Conditions
Associated with an Abnormal Inflammatory Process.” The
expiration date of the issued patents is September 1,
2036.
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●
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A
series of provisional and yet unpublished applications all filed in
2020, including U.S. Application Serial No. 16/835,307, directed to
the use of niclosamide for the treatment of COVID-19
gastrointestinal infections, which has been allowed and upon
issuance will have an expiration date in 2040.
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Director, Title
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Age
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Edward J. Borkowski – Chair and Independent
Director
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60
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Charles J. Casamento – Independent Director
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75
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Alastair Riddell, MSc., MBChB., DSc. – Independent
Director
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71
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Vern L. Schramm, Ph.D. – Independent Director
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79
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James Sapirstein – President, Chief Executive Officer and
Non-Independent Director
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59
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Gregory Oakes –Independent Director
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52
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Name
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Fees Earned or
Paid in Cash
(2)
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Stock Awards
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Option Awards
(3)
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All Other
Compensation
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Total
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Edward
J. Borkowski
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$19,375
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$-
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$35,968
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-
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$55,343
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Charles
J. Casamento
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$11,500
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$-
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$35,968
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-
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$47,468
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Alastair
Riddell
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$11,500
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$-
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$35,968
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-
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$47,468
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Vern
L. Schramm
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$8,750
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$-
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$35,968
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-
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$44,718
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Gregory
Oakes (1)
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$8,750
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$-
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$30,444
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-
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$39,194
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Executive Officer
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Age
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Title
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James Sapirstein
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58
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President, Chief Executive Officer and Director
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Daniel Schneiderman
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42
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Chief Financial Officer
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James E. Pennington
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77
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Chief Medical Officer
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Executive Compensation
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Equity
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All
Other
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Year
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Salary
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Bonus
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Awards
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Compensation
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Total
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Current Named Executive Officers
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James
Sapirstein
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2020
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$462,500
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$159,505
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(2)
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$ 837,840
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(3)
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$1,459,845
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President
and Chief Executive Officer
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2019
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102,404
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-
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232,900
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(4)
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-
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335,304
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James
Pennington
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2020
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260,000
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64,799
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(2)
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209,460
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(3)
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-
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534,259
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Chief
Medical Officer
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2019
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255,000
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75,000
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115,000
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(4)
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-
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445,000
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Daniel
Schneiderman
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2020
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285,000
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71,029
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(2)
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451,352
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(3)
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-
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807,381
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Chief
Financial officer
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2019
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-
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-
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-
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(5)
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-
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-
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Former Named Executive Officers (1)
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|||||
John
M. (Thijs) Spoor
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2020
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-
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-
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-
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-
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-
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Former
President, Chief Executive Officer and Director (6)
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2019
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340,177
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-
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157,500
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(4)
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-
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497,677
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Maged
Shenouda
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2020
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-
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-
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-
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-
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-
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Former
Chief Financial Officer (7)
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2019
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308,035
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-
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105,000
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(4)
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-
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413,035
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Daniel
Dupret
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2020
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-
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-
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-
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-
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-
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Former
Chief Scientific Officer
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2019
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151,393
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-
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-
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-
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151,393
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(1)
Mr. Spoor’s employment with us as President and Chief
Executive Officer terminated effective October 8, 2019 due to his
resignation. In addition, Mr. Spoor resigned as a member of the
Board on April 29, 2020.
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Mr. Shenouda’s employment with
us as Chief Financial Officer terminated effective November 30,
2019 due to his resignation.
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Dr. Dupret retired and resigned from
his position as President of AzurRx SAS, a wholly owned French
subsidiary of ours effective July 1,
2019.
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(2)
Represents accrued and unpaid bonuses during 2020, as of December
31, 2020.
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(3) Represents the grant date fair value of
restricted stock and stock options issued during the year ended
December 31, 2020, calculated in accordance with ASC Topic 718. The
assumptions used in the calculation of these amounts are included
in Note 13 of the notes to the consolidated financial statements
contained in our Annual Report, filed with the SEC on
March 30, 2020.
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(4)
Represents the grant date fair value of restricted stock and stock
options issued during the year ended December 31, 2019, calculated
in accordance with ASC Topic 718. The assumptions used in the
calculation of these amounts are included in Note 13 of the notes
to the consolidated financial statements contained in the
Company’s Annual Report, filed with the SEC on March 30,
2020.
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(5)
Mr. Schneiderman received no compensation during this period or
prior to his appointments as our Chief Financial Officer, which
became effective January 2, 2020.
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(6)
On June 28, 2019, we accrued an incentive bonus in the amount of
$255,000 payable to Mr. Spoor. Subsequent to Mr. Spoor’s
resignation, the Compensation Committee reviewed the accrued bonus
and determined that such amount was not owed to Mr. Spoor, which
determination is currently being challenged by Mr. Spoor. As a
result of the Board’s and management’s determination,
we reversed the accrual in the quarter ended December 31, 2019.
This bonus has been excluded from the table.
In addition, all unvested shares of
restricted stock and stock options subject to time and other
performance-based vesting conditions have been forfeited in
connection with Mr. Spoor's resignation as our President and Chief
Executive Officer. Mr. Spoor also forfeited the right to receive
241,667 earned, but unissued shares of restricted stock in
connection with his resignation from the Board on April 29,
2020.
On July 9, 2020, we and Mr. Spoor
entered into a settlement and general release (the “Spoor
Settlement and Release”), effective July 9, 2020 (the
“Spoor Settlement Date”), of certain claims relating to
Mr. Spoor's separation from the Company on October 8, 2019. In
connection with the Spoor Settlement and Release, on July 14, 2020,
we granted Mr. Spoor warrants to purchase an aggregate of 150,000
shares of Common Stock, which had a grant date fair value of
$85,770. In addition, Mr. Spoor legally released all claims to a
discretionary bonus in the amount of $255,000, which we originally
accrued in June 2019 but was subsequently reversed during the
quarter ended December 31, 2019, legally released all claims
relating to $348,400 due to JIST Consulting, a company controlled
by Mr. Spoor and we also paid Mr. Spoor's legal expenses in the
amount of $51,200.
|
(7)
On June 28, 2019, we accrued an incentive bonus in the amount of
$100,000 payable to Mr. Shenouda. Subsequent to Mr.
Shenouda’s resignation, the Compensation Committee reviewed
the accrued bonus and determined that such amount was not owed, and
we reversed the accrual in the quarter ended December 31, 2019.
This bonus has been excluded from the table.
On July 2, 2020, we and Maged
Shenouda, entered into a settlement and general release (the
“Shenouda Settlement and Release”), of certain claims
relating to Mr. Shenouda’s s separation from the Company
effective November 30, 2019. In connection with the Shenouda
Settlement and Release, we paid a total of $15,000 to Mr. Shenouda,
which amount includes $10,000 of accounts payable of the Company
due to Mr. Shenouda for services provided and $5,000 for legal
expenses, and Mr. Shenouda legally released all claims relating to
a discretionary bonus in the amount of $100,000 we originally
accrued in June 2019, but was subsequently reversed during the
quarter ended December 31, 2019
|
(1)
|
Represents stock options issued to Mr. Sapirstein on October 8,
2019 under the terms of his employment agreement, which options
will vest as follows: (i) as to 50,000 shares upon initiating our
next U.S. Phase 2 clinical trial for MS1819, (ii) as to 50,000
shares upon completing the next U.S. Phase 2 clinical trial for
MS1819, (iii) as to 100,000 shares upon our initiating a Phase 3
clinical trial in the U.S. for MS1819, and (iv) as to 100,000
shares upon initiating a U.S. Phase 1 clinical trial for any
product other than MS1819.
|
(2)
|
Represents the restricted stock unit (“RSU“) award
issued to Mr. Sapirstein on October 8, 2019 under the terms of his
employment agreement, which RSU will vest as follows: (i) as to
100,000 shares upon the first commercial sale in the U.S. of
MS1819, and (ii) as to 100,000 shares upon our total market
capitalization exceeding $1.0 billion for 20 consecutive trading
days.
|
(3)
|
Represents stock options issued to Mr. Sapirstein on July 16, 2020
under 2014 Plan, which options will vest as follows: (i) 50,000
upon initiating its next U.S. Phase 2 clinical trial MS1819, (ii)
50,000 upon completing the next U.S. Phase 2 clinical trial, (iii)
100,000 upon the Company initiating a Phase 3 clinical trial in the
U.S. for MS1819, and (iv) 100,000 upon initiating a U.S. Phase I
clinical trial for any product other than MS1819.
|
(4)
|
During the three months ended September 30, 2020, the Board
approved an amended and restated option grant to Mr. Schneiderman,
amending and restating a grant previously made on January 2, 2020,
to reduce the amount of shares issuable upon exercise of such
option to be the maximum number of shares Mr. Schneiderman was
eligible to receive under the 2014 Plan on the original grant date,
or 300,000 shares, due to the 2014 Incentive Plan provisions
relating to the Section 162(m) limitations described above. The
Board also approved the issuance of a replacement option covering
the balance of shares intended to be issued at that time, or 35,006
shares. The original stock option has an exercise price of $1.03,
the closing sale price of Common Stock on January 2, 2020, which
was the date of its original grant, and the replacement stock
option has an exercise price of $0.85, the closing sale price of
the Common Stock on its date of grant. Both the original stock
option and the replacement stock option vest over a term of three
years, in 36 equal monthly installments on each monthly anniversary
of January 2, 2020.
|
|
Number of securities to be
issued upon exercise ofoutstanding options, warrants
and
|
Weighted-average exercise
price of outstanding options, warrants
and
|
Number of securities
remaining available for future issuance
under equity compensation
plans reflected
in
|
Plan
category
|
rights
|
rights
|
column
(a))
|
|
(a)
|
(b)
|
(c )
|
Equity compensation
plans approved by security holders (1) (2)
|
4,298,691
|
1.23
|
9,783,815
|
|
|
|
|
Equity compensation
plans not approved by security holders
|
-
|
-
|
-
|
|
|
|
|
Total
|
4,298,691
|
1.23
|
9,783,815
|
|
Number of Shares of Common Stock Owned Prior to
Offering
|
Maximum Number of shares of Common Stock to be Sold Pursuant to
this Prospectus
|
Number of Shares of Common Stock Owned After
Offering
|
Name of Selling Stockholder
|
Number
|
Offered(1)
|
Number
|
Armistice Capital
Master Fund Ltd. (1)
|
16,000,002
|
16,000,002
|
0
|
Report
of Independent Registered Public Accounting Firm
|
F-32
|
Consolidated
Balance Sheets as of December 31, 2019 and 2018
|
F-33
|
Consolidated
Statements of Operations and Comprehensive Loss for the years
ended December 31, 2019 and 2018
|
F-34
|
Consolidated
Statements of Changes in Stockholders’ Equity for the
years ended December 31, 2019 and 2018
|
F-35
|
Consolidated
Statements of Cash Flows for the years ended December 31, 2019 and
2018
|
F-36
|
Notes
to the Consolidated Financial Statements
|
F-37
|
|
Three Months
|
Three Months
|
Nine Months
|
Nine Months
|
|
Ended
|
Ended
|
Ended
|
Ended
|
|
09/30/20
|
09/30/19
|
09/30/20
|
09/30/19
|
|
|
|
|
|
Research
and development expenses
|
$1,795,684
|
$2,221,933
|
$4,438,229
|
$7,927,907
|
General
and administrative expenses
|
1,916,250
|
1,860,141
|
4,595,860
|
5,690,001
|
|
|
|
|
|
Loss
from operations
|
(3,711,934)
|
(4,082,074)
|
(9,034,089)
|
(13,617,908)
|
|
|
|
|
|
Other:
|
|
|
|
|
Interest
expense
|
(1,203,404)
|
(110,398)
|
(5,838,417)
|
(278,155)
|
Gain
(Loss) on Settlement
|
211,430
|
|
211,430
|
|
Gain
(Loss) on Debt Extinguishment
|
(609,998)
|
|
(609,998)
|
|
Total
other
|
(1,601,972)
|
(110,398)
|
(6,236,985)
|
(278,155)
|
|
|
|
|
|
Loss
before income taxes
|
(5,313,906)
|
(4,192,472)
|
(15,271,074)
|
(13,896,063)
|
|
|
|
|
|
Income
taxes
|
-
|
-
|
-
|
-
|
|
|
|
|
|
Net
loss
|
(5,313,906)
|
(4,192,472)
|
(15,271,074)
|
(13,896,063)
|
|
|
|
|
|
Other
comprehensive loss:
|
|
|
|
|
Foreign
currency translation adjustment
|
108,712
|
(138,241)
|
(55,007)
|
(207,034)
|
Total
comprehensive loss
|
$(5,205,194)
|
$(4,330,713)
|
$(15,326,081)
|
$(14,103,097)
|
|
|
|
|
|
Net
loss
|
$(5,313,906)
|
$(4,192,472)
|
$(15,271,074)
|
$(13,896,063)
|
Deemed
dividend of preferred stock
|
(8,155,212)
|
-
|
(8,155,212)
|
-
|
Net
loss applicable to common stockholders
|
(13,469,118)
|
(4,192,472)
|
(23,426,286)
|
(13,896,063)
|
|
|
|
|
|
Basic
and diluted weighted average shares outstanding
|
28,518,835
|
24,962,691
|
27,828,235
|
21,080,701
|
|
|
|
|
|
Net
loss per share - basic and diluted
|
$(0.47)
|
$(0.17)
|
$(0.84)
|
$(0.66)
|
|
Convertible
|
|
|
Additional
|
|
Other
|
|
|
|
Preferred Stock
|
Common Stock
|
Paid In
|
Accumulated
|
Comprehensive
|
|
||
|
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Deficit
|
Loss
|
Total
|
|
|
|
|
|
|
|
|
|
Balance, January 1, 2019
|
-
|
$-
|
17,704,925
|
$1,771
|
$53,139,259
|
$(47,517,046)
|
$(1,150,112)
|
$4,473,872
|
|
|
|
|
|
|
|
|
|
Common
stock issued from public offerings
|
|
|
7,522,097
|
752
|
9,491,265
|
|
|
9,492,017
|
Common
stock issued to consultants
|
|
|
62,158
|
6
|
112,494
|
|
|
112,500
|
Common
stock issued to Mayoly for patents
|
|
|
775,931
|
77
|
1,740,882
|
|
|
1,740,959
|
Stock-based
compensation
|
|
|
|
|
541,725
|
|
|
541,725
|
Restricted
stock granted to employees/directors
|
|
|
90,000
|
9
|
556,879
|
|
|
556,888
|
Warrant
modification
|
|
|
|
|
325,320
|
|
|
325,320
|
Received
from stockholder in relation to warrant modification
|
|
|
|
|
61,590
|
|
|
61,590
|
Foreign
currency translation adjustment
|
|
|
|
|
|
|
(207,034)
|
(207,034)
|
Net
loss
|
|
|
|
|
|
(13,896,063)
|
|
(13,896,063)
|
Balance, September 30, 2019
|
-
|
$-
|
26,155,111
|
$2,615
|
$65,969,414
|
$(61,413,109)
|
$(1,357,146)
|
$3,201,774
|
|
|
|
|
|
|
|
|
|
Balance, January 1, 2020
|
-
|
$-
|
26,800,519
|
$2,680
|
$68,575,851
|
$(62,694,732)
|
$(1,266,555)
|
$4,617,244
|
Issuance
of Series B preferred stock and warrants for cash, conversion of
promissory notes, net of offering costs
|
2,912
|
-
|
|
|
14,460,155
|
|
|
14,460,155
|
Warrants
issued in connection with Series B convertible preferred stock
private placement
|
|
|
|
|
5,952,516
|
|
|
5,952,516
|
Warrants
issued as inducement to exchange promissory notes into Series B
convertible preferred stock private placement
|
|
|
|
|
986,526
|
|
|
986,526
|
Beneficial
conversion feature of Series B preferred stock
|
|
|
|
|
8,155,212
|
|
|
8,155,212
|
Deemed
dividend of preferred stock
|
|
|
|
|
(8,155,212)
|
|
|
(8,155,212)
|
Accrued
dividends on Series B preferred stock
|
|
|
|
|
(412,829)
|
|
|
(412,829)
|
Deemed
dividend related to exchange of promissory notes into Series B
preferred stock
|
|
|
|
|
(1,129,742)
|
|
|
(1,129,742)
|
Conversion
of Series B preferred shares into common stock
|
(34)
|
-
|
341,274
|
34
|
(34)
|
|
|
-
|
Issuance
of common stock for accrued dividends upon conversion of Series B
preferred stock
|
|
|
6,214
|
1
|
4,785
|
|
|
4,786
|
Common
stock issued to settle accounts payable
|
|
|
105,937
|
11
|
131,126
|
|
|
131,137
|
Common
stock issued to Lincoln Park for Equity Purchase
agreement
|
|
|
1,495,199
|
149
|
988,199
|
|
|
988,348
|
Warrants
issued in association with convertible debt issuance
|
|
|
|
|
1,252,558
|
|
|
1,252,558
|
Beneficial
conversion feature on convertible debt issuances
|
|
|
|
|
1,838,422
|
|
|
1,838,422
|
Common
stock issued to consultants
|
|
|
132,841
|
13
|
109,592
|
|
|
109,605
|
Settlement
with former chief executive officer
|
|
|
|
|
85,770
|
|
|
85,770
|
Stock-based
compensation
|
|
|
|
|
396,809
|
|
|
396,809
|
Foreign
currency translation adjustment
|
|
|
|
|
-
|
|
55,007
|
55,007
|
Net
loss
|
|
|
|
|
|
(15,271,074)
|
|
(15,271,074)
|
Balance, September 30, 2020
|
2,878
|
$-
|
28,881,984
|
$2,888
|
$93,239,704
|
$(77,965,806)
|
$(1,211,548)
|
$14,065,238
|
|
September 30,
|
December 31,
|
|
2020
|
2019
|
R&D
tax credits
|
$-
|
$2,566,281
|
Other
|
20,688
|
71,022
|
Total
other receivables
|
$20,688
|
$2,637,303
|
|
September 30,
|
December 31,
|
|
2020
|
2019
|
Laboratory
equipment
|
$193,661
|
$193,661
|
Computer
equipment
|
77,850
|
74,836
|
Office
equipment
|
36,703
|
36,703
|
Leasehold
improvements
|
29,162
|
35,711
|
Total
property, plant and equipment
|
337,376
|
340,911
|
Less
accumulated depreciation
|
(283,306)
|
(263,520)
|
Property,
plant and equipment, net
|
$54,070
|
$77,391
|
Common
stock issued at signing to Mayoly
|
$1,740,959
|
Due
to Mayoly at 12/31/19 - €400,000
|
449,280
|
Due
to Mayoly at 12/31/20 - €350,000
|
393,120
|
Assumed
Mayoly liabilities and forgiveness of Mayoly debt
|
1,219,386
|
|
$3,802,745
|
|
September 30,
|
December 31,
|
|
2020
|
2019
|
Patents
|
$3,802,745
|
$3,802,745
|
Less
accumulated amortization
|
(791,322)
|
(395,661)
|
Patents,
net
|
$3,011,423
|
$3,407,084
|
2020
(balance of year)
|
$395,661
|
2021
|
527,548
|
2022
|
527,548
|
2023
|
527,548
|
2024
|
527,548
|
2025
|
527,548
|
|
Goodwill
|
Balance
at January 1, 2019
|
$1,924,830
|
Foreign
currency translation
|
(38,144)
|
Balance
at December 31, 2019
|
1,886,686
|
Foreign
currency translation
|
81,833
|
Balance
at September 30, 2020
|
$1,968,519
|
|
September 30,
|
December 31,
|
|
2020
|
2019
|
Trade
payables
|
$1,422,066
|
$1,683,505
|
Accrued
expenses
|
263,937
|
71,177
|
Total
accounts payable and accrued expenses
|
$1,686,003
|
$1,754,682
|
|
Total
|
Promissory Notes
|
ADEC Notes
|
Total
|
|
September 30,
|
September 30,
|
September 30,
|
December 31,
|
|
2020
|
2020
|
2020
|
2019
|
Convertible
debt
|
$-
|
$-
|
$-
|
$3,836,300
|
Unamortized
debt discount - revalued warrants
|
-
|
-
|
-
|
(118,356)
|
Unamortized
debt discount - warrants
|
-
|
-
|
-
|
(878,979)
|
Unamortized
debt discount - BCF
|
-
|
-
|
-
|
(1,307,755)
|
Unamortized
debt discount - debt issuance costs
|
-
|
-
|
-
|
(566,815)
|
Accrued
interest
|
-
|
-
|
-
|
112,543
|
Total
convertible debt
|
$-
|
$-
|
$-
|
$1,076,938
|
|
September 30,
|
December 31,
|
Current
|
2020
|
2019
|
Due
to Mayoly
|
$410,026
|
$392,989
|
Lease
liabilities
|
74,156
|
83,235
|
Other
liabilities
|
8,633
|
-
|
|
$492,815
|
$476,224
|
|
|
|
|
September 30,
|
December 31,
|
Long-term
|
2020
|
2019
|
Lease
liabilities
|
31,469
|
-
|
|
$31,469
|
$-
|
●
|
the
lowest sale price of Common Stock on the purchase date;
and;
|
|
|
●
|
the
average of the three lowest closing sale prices for the Common
Stock during the ten consecutive business days ending on the
business day immediately preceding the purchase date of such
shares;
|
●
|
97%
of the volume weighted average price of the Company’s common
stock during the applicable Accelerated Purchase Measurement Period
on the applicable Accelerated Purchase date; and
|
|
|
●
|
the
closing sale price of Common Stock on the applicable Accelerated
Purchase Date.
|
●
|
97%
of the volume weighted average price of the Company’s common
stock during the applicable Additional Accelerated Purchase
Measurement Period on the applicable Additional Accelerated
Purchase date; and
|
|
|
●
|
the
closing sale price of Common Stock on the applicable Additional
Accelerated Purchase.
|
|
|
Exercise
|
Weighted
|
|
|
Price Per
|
Average
|
|
Warrants
|
Share
|
Exercise Price
|
|
|
|
|
Warrants outstanding and exercisable at January 1,
2019
|
3,112,715
|
$2.55 - 7.37
|
$4.83
|
|
|
|
|
Granted
during the period
|
275,663
|
$2.55 – 2.82
|
$2.68
|
Expired
during the period
|
-
|
-
|
-
|
Exercised
during the period
|
-
|
-
|
-
|
Warrants outstanding and exercisable at September 30,
2019
|
3,388,378
|
$1.50 - 7.37
|
$3.51
|
|
|
|
|
|
|
|
|
Warrants outstanding and exercisable at January 1,
2020
|
5,378,288
|
$1.07 - 7.37
|
$2.53
|
|
|
|
|
Granted
during the period
|
19,881,654
|
$0.85 - 1.42
|
$0.88
|
Expired
during the period
|
(59,774)
|
$3.25 - 7.37
|
$5.15
|
Exercised
during the period
|
-
|
-
|
-
|
Warrants outstanding and exercisable at September 30,
2020
|
25,200,168
|
$0.85 - 7.37
|
$1.22
|
|
|
Number of
|
Weighted Average
|
Weighted
|
|
|
Shares Under
|
Remaining Contract
|
Average
|
|
Exercise Price
|
Warrants
|
Life in Years
|
Exercise Price
|
|
$0.00
- 0.99
|
17,718,665
|
4.79
|
|
|
$1.00
- 1.99
|
5,362,464
|
3.65
|
|
|
$2.00
- 2.99
|
320,063
|
2.82
|
|
|
$3.00
- 3.99
|
635,019
|
1.57
|
|
|
$4.00
- 4.99
|
164,256
|
1.53
|
|
|
$5.00
- 5.99
|
783,132
|
1.42
|
|
|
$6.00
- 6.99
|
187,750
|
1.01
|
|
|
$7.00
- 7.37
|
28,819
|
0.28
|
|
Totals
|
|
25,200,168
|
4.28
|
$1.22
|
|
September 30,
|
|
2020
|
Expected
life (in years)
|
5
|
Volatility
|
84.7%
|
Risk-free
interest rate
|
0.28-1.67%
|
Dividend
yield
|
-%
|
|
September 30,
|
|
2020
|
Expected
life (in years)
|
10
|
Volatility
|
84.0%
|
Risk-free
interest rate
|
0.62- 1.88%
|
Dividend
yield
|
-%
|
|
Number
|
Average
|
Remaining Contract
|
Intrinsic
|
|
of Shares
|
Exercise Price
|
Life in Years
|
Value
|
|
|
|
|
|
Stock options outstanding at January 1, 2019
|
994,000
|
$3.58
|
5.42
|
$-
|
|
|
|
|
|
Granted
during the period
|
893,500
|
$1.70
|
4.96
|
-
|
Expired
during the period
|
-
|
-
|
-
|
-
|
Canceled
during the period
|
-
|
-
|
-
|
-
|
Exercised
during the period
|
-
|
-
|
-
|
-
|
Stock options outstanding at September 30, 2019
|
1,887,500
|
$2.58
|
4.69
|
$-
|
|
|
|
|
|
Exercisable at September 30, 2019
|
994,000
|
$3.58
|
5.17
|
$-
|
|
|
|
|
|
Non-vested stock options outstanding at January 1,
2019
|
244,500
|
$3.05
|
4.53
|
$-
|
|
|
|
|
|
Granted
during the period
|
893,500
|
$1.70
|
4.96
|
-
|
Vested
during the period
|
(274,500)
|
$2.91
|
3.88
|
-
|
Expired
during the period
|
-
|
-
|
-
|
-
|
Canceled
during the period
|
-
|
-
|
-
|
-
|
Exercised
during the period
|
-
|
-
|
-
|
-
|
Non-vested stock options outstanding at September 30,
2019
|
863,500
|
$1.70
|
4.77
|
$-
|
Stock options outstanding at January 1, 2020
|
1,677,5000
|
$2.17
|
5.37
|
$-
|
|
|
|
|
|
Granted
during the period
|
2,870,012
|
$0.89
|
9.79
|
$-
|
Expired
during the period
|
-
|
-
|
|
|
Canceled
during the period
|
(235,006)
|
$1.94
|
3.28
|
$-
|
Exercised
during the period
|
-
|
-
|
|
|
Stock options outstanding at September 30, 2020
|
4,312,506
|
$1.38
|
7.94
|
$-
|
|
|
|
|
|
Exercisable at September 30, 2020
|
1,084,834
|
$2.59
|
5.60
|
$-
|
Non-vested stock options outstanding at January 1,
2020
|
883,500
|
$1.33
|
6.26
|
$-
|
|
|
|
|
|
Granted
during the period
|
2,870,012
|
$0.98
|
10.00
|
$-
|
Vested
during the period
|
(593,750)
|
$2.59
|
6.88
|
$-
|
Expired
during the period
|
-
|
-
|
-
|
|
Canceled
during the period
|
(160,006)
|
$1.30
|
7.10
|
$-
|
Exercised
during the period
|
-
|
-
|
-
|
|
Non-vested stock options outstanding at September 30,
2020
|
2,999,756
|
$0.98
|
8.75
|
$-
|
|
September
30,
|
|
2020
|
Lease term and discount rate
|
|
Weighted-average
remaining lease term
|
1.16 years
|
Weighted-average
discount rate
|
6.0%
|
2020
|
$30,565
|
2021
|
55,420
|
2022
|
23,375
|
Total
lease payments
|
109,360
|
Less
imputed interest
|
(3,736)
|
Present
value of lease liabilities
|
$105,624
|
|
Convertible Preferred Stock
|
Common Stock
|
Paid-in
|
Subscription
|
Accumulated
|
Accumulated Other
Comprehensive
|
Total
|
||
|
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Receivable
|
Deficit
|
Loss
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2018
|
-
|
$-
|
12,042,574
|
$1,205
|
$37,669,601
|
$(1,071,070)
|
$(33,983,429)
|
$(955,715)
|
$1,660,592
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued from public offering
|
-
|
-
|
4,160,000
|
416
|
9,577,647
|
-
|
-
|
-
|
9,578,063
|
Common
stock issued to consultants
|
-
|
-
|
118,818
|
12
|
360,759
|
-
|
-
|
-
|
360,771
|
Common
stock issued for warrant exercises
|
-
|
-
|
503,070
|
50
|
1,253,623
|
1,071,070
|
-
|
-
|
2,324,743
|
Common
stock issued for purchase of Protea assets from
bankruptcy
|
-
|
-
|
734,463
|
73
|
1,299,926
|
-
|
-
|
-
|
1,299,999
|
Stock-based
compensation
|
-
|
-
|
-
|
-
|
1,441,475
|
-
|
-
|
-
|
1,441,475
|
Restricted
common stock granted to employees and directors
|
-
|
-
|
120,000
|
12
|
1,038,810
|
-
|
-
|
-
|
1,038,822
|
Convertible
debt converted into common stock
|
-
|
-
|
26,000
|
3
|
68,670
|
-
|
-
|
-
|
68,673
|
Warrant
modification
|
-
|
-
|
-
|
-
|
428,748
|
-
|
-
|
-
|
428,748
|
Foreign
currency translation adjustment
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(194,397)
|
(194,397)
|
Net
loss
|
-
|
-
|
|
-
|
-
|
-
|
(13,533,617)
|
-
|
(13,533,617)
|
Balance at December 31, 2018
|
-
|
$-
|
17,704,925
|
$1,771
|
$53,139,259
|
$-
|
$(47,517,046)
|
$(1,150,112)
|
$4,473,872
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued from public offerings
|
-
|
-
|
7,522,097
|
752
|
9,475,997
|
-
|
-
|
-
|
9,476,749
|
Common
stock issued to consultants
|
-
|
-
|
190,398
|
19
|
209,981
|
-
|
-
|
-
|
210,000
|
Common
stock issued to Mayoly for patents
|
-
|
-
|
775,931
|
77
|
1,740,882
|
-
|
-
|
-
|
1,740,959
|
Common
stock issued to Lincoln Park for Equity Purchase
agreement
|
-
|
-
|
487,168
|
49
|
(49)
|
-
|
-
|
-
|
-
|
Warrants
issued in association with convertible debt issuances
|
-
|
-
|
-
|
-
|
1,081,673
|
-
|
-
|
-
|
1,081,673
|
Beneficial
conversion feature on convertible debt issuances
|
-
|
-
|
-
|
-
|
1,359,284
|
-
|
-
|
-
|
1,359,284
|
Stock-based
compensation
|
-
|
-
|
-
|
-
|
574,335
|
-
|
-
|
-
|
574,335
|
Restricted
common stock granted to employees and directors
|
-
|
-
|
120,000
|
12
|
607,579
|
-
|
-
|
-
|
607,591
|
Warrant
modification
|
-
|
-
|
-
|
-
|
325,320
|
-
|
-
|
-
|
325,320
|
Received
from stockholder in relation to warrant modification
|
-
|
-
|
-
|
-
|
61,590
|
-
|
-
|
-
|
61,590
|
Foreign
currency translation adjustment
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(116,443)
|
(116,443)
|
Net
loss
|
-
|
-
|
-
|
-
|
-
|
-
|
(15,177,686)
|
-
|
(15,177,686)
|
Balance at December 31, 2019
|
-
|
$-
|
26,800,519
|
$2,680
|
$68,575,851
|
$-
|
$(62,694,732)
|
$(1,266,555)
|
$4,617,244
|
|
|
Fair Value Measured at Reporting Date Using
|
|
||
|
Carrying Amount
|
Level 1
|
Level 2
|
Level 3
|
Fair Value
|
At
December 31, 2019:
|
|
|
|
|
|
Cash
|
$175,796
|
$-
|
$175,796
|
$-
|
$175,796
|
Other
receivables
|
$2,637,303
|
$-
|
$-
|
$2,637,303
|
$2,637,303
|
Note
payable
|
$444,364
|
$-
|
$-
|
$444,364
|
$444,364
|
Convertible
debt
|
$1,076,938
|
$-
|
$-
|
$1,076,938
|
$1,076,938
|
|
|
|
|
|
|
At
December 31, 2018:
|
|
|
|
|
|
Cash
|
$1,114,343
|
$-
|
$1,114,343
|
$-
|
$1,114,343
|
Other
receivables
|
$3,172,676
|
$-
|
$-
|
$3,172,676
|
$3,172,676
|
Note
payable
|
$255,032
|
$-
|
$-
|
$255,032
|
$255,032
|
|
December 31,
|
December 31,
|
|
2019
|
2018
|
R&D
tax credits
|
$2,566,281
|
$2,162,373
|
Other
|
71,022
|
1,010,303
|
Total
other receivables
|
$2,637,303
|
$3,172,676
|
|
December 31,
|
December 31,
|
|
2019
|
2018
|
Laboratory
equipment
|
$193,661
|
$190,406
|
Computer
equipment
|
74,836
|
75,417
|
Office
equipment
|
36,703
|
37,262
|
Leasehold
improvements
|
35,711
|
29,163
|
Total
property, plant and equipment
|
340,911
|
332,248
|
Less
accumulated depreciation
|
(263,520)
|
(203,394)
|
Property,
plant and equipment, net
|
$77,391
|
$128,854
|
Common
stock issued at signing to Mayoly, subject to vesting
|
$1,740,959
|
Due
to Mayoly at 12/31/19 - €400,000
|
449,280
|
Due
to Mayoly at 12/31/20 - €350,000
|
393,120
|
Assumed
Mayoly liabilities and forgiveness of Mayoly debt
|
1,219,386
|
|
|
|
$3,802,745
|
|
December 31,
|
December 31,
|
|
2019
|
2018
|
In
process research and development
|
$-
|
$416,600
|
Less
accumulated amortization
|
-
|
(157,671)
|
In
process research and development, net
|
$-
|
$258,929
|
|
|
|
License
agreements
|
$-
|
$3,398,702
|
Less
accumulated amortization
|
-
|
(3,087,154)
|
License
agreements, net
|
$-
|
$311,548
|
|
|
|
Patents
|
$3,802,745
|
$-
|
Less
accumulated amortization
|
(395,661)
|
-
|
Patents,
net
|
$3,407,084
|
$-
|
|
Goodwill
|
Balance
at January 1, 2018
|
$2,016,240
|
Foreign
currency translation
|
(91,410)
|
Balance
at December 31, 2018
|
1,924,830
|
Foreign
currency translation
|
(38,144)
|
Balance
at December 31, 2019
|
$1,886,686
|
|
December 31,
|
December 31,
|
|
2019
|
2018
|
Trade
payables
|
$1,683,505
|
$1,532,110
|
Accrued
expense
|
71,177
|
285,061
|
Accrued
payroll
|
-
|
253,225
|
Total
accounts payable and accrued expense
|
$1,754,682
|
$2,070,396
|
|
Total
|
Promissory Notes
|
ADEC Notes
|
Total
|
|
December 31,
|
December 31,
|
December 31,
|
December 31,
|
|
2019
|
2019
|
2019
|
2018
|
Convertible
debt
|
$3,836,300
|
$3,386,300
|
$450,000
|
$-
|
Unamortized
debt discount - revalued warrants
|
(118,356)
|
-
|
(118,356)
|
-
|
Unamortized
debt discount - warrants
|
(878,979)
|
(878,979)
|
-
|
-
|
Unamortized
debt discount - BCF
|
(1,307,755)
|
(1,307,755)
|
-
|
-
|
Unamortized
debt discount - debt issuance costs
|
(566,815)
|
(566,815)
|
-
|
-
|
Accrued
interest
|
112,543
|
8,390
|
104,153
|
-
|
Total
convertible debt
|
$1,076,938
|
$641,141
|
$435,797
|
$-
|
|
December 31,
|
December 31,
|
|
2019
|
2018
|
Due
to Mayoly
|
$392,989
|
$-
|
Lease
liabilities
|
83,235
|
-
|
|
$476,224
|
$-
|
●
|
the
lowest sale price of Common Stock on the purchase date;
and;
|
|
|
●
|
the
average of the three lowest closing sale prices for the Common
Stock during the ten consecutive business days ending on the
business day immediately preceding the purchase date of such
shares;
|
●
|
97%
of the volume weighted average price of the Company’s common
stock during the applicable Accelerated Purchase Measurement Period
on the applicable Accelerated Purchase date; and
|
|
|
●
|
the
closing sale price of Common Stock on the applicable Accelerated
Purchase Date.
|
●
|
97%
of the volume weighted average price of the Company’s common
stock during the applicable Additional Accelerated Purchase
Measurement Period on the applicable Additional Accelerated
Purchase date; and
|
|
|
●
|
the
closing sale price of Common Stock on the applicable Additional
Accelerated Purchase.
|
|
|
Exercise
|
Weighted
|
|
|
Price Per
|
Average
|
|
Warrants
|
Share
|
Exercise Price
|
|
|
|
|
Warrants outstanding and exercisable at January 1,
2018
|
3,371,385
|
$3.17 - $7.37
|
$5.28
|
|
|
|
|
Granted
during the period
|
244,400
|
$2.55 - $2.75
|
$2.58
|
Expired
during the period
|
-
|
-
|
-
|
Exercised
during the period
|
(503,070)
|
$2.50
|
$2.50
|
Warrants outstanding and exercisable at December 31,
2018
|
3,112,715
|
$2.55 - $7.37
|
$4.83
|
|
|
|
|
|
|
|
|
Warrants outstanding and exercisable at January 1,
2019
|
3,112,715
|
$2.55 - $7.37
|
$4.83
|
|
|
|
|
Granted
during the period
|
2,265,573
|
$1.07 - $2.82
|
$1.15
|
Expired
during the period
|
-
|
-
|
-
|
Exercised
during the period
|
-
|
-
|
-
|
Warrants outstanding and exercisable at December 31,
2019
|
5,378,288
|
$1.25 - $7.37
|
$2.53
|
|
Number of
|
Weighted Average
|
Weighted
|
|
Shares Under
|
Remaining Contract
|
Average
|
Exercise Price
|
Warrants
|
Life in Years
|
Exercise Price
|
$1.07
- $1.99
|
3,199,475
|
3.95
|
|
$2.00
- $2.99
|
320,063
|
3.57
|
|
$3.00
- $3.99
|
636,972
|
2.31
|
|
$4.00
- $4.99
|
196,632
|
2.01
|
|
$5.00
- $5.99
|
805,476
|
2.13
|
|
$6.00
- $6.99
|
187,750
|
1.76
|
|
$7.00
- $7.37
|
31,920
|
0.96
|
|
Total
|
5,378,288
|
3.30
|
$2.53
|
|
December 31,
|
December 31,
|
|
2019
|
2018
|
Expected
life (in years)
|
5
|
5
|
Volatility
|
71
- 80%
|
84%
|
Risk-free
interest rate
|
1.64
- 2.37%
|
2.70%
|
Dividend
yield
|
-%
|
-%
|
|
December 31,
|
December 31,
|
|
2019
|
2018
|
Contractual
term (in years)
|
5
- 10
|
5
|
Volatility
|
72%
- 75%
|
85%
|
Risk-free
interest rate
|
1.54%
- 1.84%
|
2.82%
|
Dividend
yield
|
-%
|
-%
|
|
Number
|
Average
|
Remaining Contract
|
Intrinsic
|
|
of Shares
|
Exercise Price
|
Life in Years
|
Value
|
|
|
|
|
|
Stock options outstanding at January 1, 2018
|
545,000
|
$4.05
|
7.13
|
$-
|
|
|
|
|
|
Granted
during the period
|
539,000
|
$3.04
|
5.00
|
$-
|
Expired
during the period
|
-
|
-
|
|
|
Canceled
during the period
|
(90,000)
|
$3.26
|
4.41
|
$-
|
Exercised
during the period
|
-
|
-
|
|
|
Stock options outstanding at December 31, 2018
|
994,000
|
$3.58
|
5.42
|
$-
|
|
|
|
|
|
Exercisable at December 31, 2018
|
749,500
|
$3.74
|
5.71
|
$-
|
|
|
|
|
|
Non-vested stock options outstanding at January 1,
2018
|
387,500
|
$3.89
|
6.39
|
$-
|
|
|
|
|
|
Granted
during the period
|
539,000
|
$3.04
|
5.00
|
$-
|
Vested
during the period
|
(600,750)
|
$3.50
|
5.00
|
$-
|
Expired
during the period
|
-
|
-
|
|
|
Canceled
during the period
|
(81,250)
|
$3.26
|
4.41
|
$-
|
Exercised
during the period
|
-
|
-
|
|
|
Non-vested stock options outstanding at December 31,
2018
|
244,500
|
$3.05
|
4.53
|
$-
|
Stock options outstanding at January 1, 2019
|
994,000
|
$3.58
|
5.42
|
$-
|
|
|
|
|
|
Granted
during the period
|
1,193,500
|
$1.44
|
5.79
|
$-
|
Expired
during the period
|
-
|
-
|
|
|
Canceled
during the period
|
(510,000)
|
$2.80
|
4.50
|
$-
|
Exercised
during the period
|
-
|
-
|
|
|
Stock options outstanding at December 31, 2019
|
1,677,500
|
$2.17
|
5.37
|
$-
|
|
|
|
|
|
Exercisable at December 31, 2019
|
794,000
|
$3.36
|
4.04
|
$-
|
|
|
|
|
|
Non-vested stock options outstanding at January 1,
2019
|
244,500
|
$3.05
|
4.53
|
$-
|
|
|
|
|
|
Granted
during the period
|
1,193,500
|
$1.44
|
5.79
|
$-
|
Vested
during the period
|
(304,500)
|
$2.79
|
3.72
|
$-
|
Expired
during the period
|
-
|
-
|
|
|
Canceled
during the period
|
(250,000)
|
$1.75
|
4.45
|
$-
|
Exercised
during the period
|
-
|
-
|
|
|
Non-vested stock options outstanding at December 31,
2019
|
883,500
|
$1.33
|
6.26
|
$-
|
|
December 31,
|
|
2019
|
Lease term and discount rate
|
|
Weighted-average
remaining lease term
|
0.85
years
|
Weighted-average
discount rate
|
6.0%
|
2020
|
87,008
|
Total
lease payments
|
87,008
|
Less
imputed interest
|
(3,773)
|
Present
value of lease liabilities
|
$83,235
|
|
December 31,
|
December 31,
|
|
2019
|
2018
|
Income
taxes benefit (expense) at statutory rate
|
21%
|
21%
|
State
income tax
|
14%
|
14%
|
Non-deductible
expense
|
(5%)
|
(6%)
|
Change
in valuation allowance
|
(30%)
|
(29%)
|
|
0%
|
0%
|
1 Year AzurRx BioPharma Chart |
1 Month AzurRx BioPharma Chart |
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