Delaware
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26-2593535
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(State or other jurisdiction of Incorporation or organization)
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(I.R.S. Employer Identification No.)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, $0.0001 par value per share
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The NASDAQ Stock Market LLC
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Large accelerated filer
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o |
Accelerated filer
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x |
Non-accelerated filer
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o |
Smaller reporting company
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o |
(Do not check if a smaller reporting company)
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PART I
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ITEM 1—BUSINESS
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3
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ITEM 1A—RISK FACTORS
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10
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ITEM 1B—UNRESOLVED STAFF COMMENTS
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22
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ITEM 2—PROPERTIES
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22
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ITEM 3—LEGAL PROCEEDINGS
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22
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ITEM 4— MINE SAFETY DISCLOSURES
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22
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PART II
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ITEM 5—MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
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23
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ITEM 6—SELECTED FINANCIAL DATA
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24
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ITEM 7—MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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25
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ITEM 7A—QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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41
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ITEM 8—CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
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42 |
ITEM 9—CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
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80
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ITEM 9A—CONTROLS AND PROCEDURES
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80
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ITEM 9B—OTHER INFORMATION
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80
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PART III
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81
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PART IV
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82
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●
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Increased cardiac contractility by calcium sensitization of troponin C, resulting in a positive inotropic effect which is not associated with substantial increases in oxygen demand.
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●
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Opening of potassium channels in the vasculature smooth muscle, resulting in a vasodilatory effect on all vascular beds.
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Opening of mitochondrial potassium channels in cardiomyocytes, resulting in a cardioprotective effect.
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sustained hemodynamic improvement;
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diminished myocardial injury;
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improved tissue perfusion;
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better outcomes and fewer hospital days;
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effects most favorable in patients with low left ventricular ejection fraction (LVEF) (< 40%); and
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●
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opportunity to initiate therapy pre-operatively due to increased cardiac contractility without increasing intracellular calcium, without increasing oxygen consumption, or affecting cardiac rhythm and relaxation.
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●
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Evidence that Levosimendan Improves Cardiac Function in Septic Shock Patients
. Results from a small trial of 28 patients with septic shock and echocardiographically proven acute left ventricular dysfunction indicate that levosimendan improved several parameters of cardiac function (Morelli 2005). Similar improvements in right ventricular function have been reported in a randomized placebo controlled trial of 35 patients that evaluated the use of levosimendan in patients suffering from septic shock and acute respiratory distress syndrome (Morelli 2006). Other similar studies have demonstrated levosimendan improvements in microcirculatory flow (Morelli 2010), improved hemodynamics with reduced requirements for additional catecholamines (Alhashemi 2009) and improvements in cardiac output and mixed venous oxygen saturation (Vaitsis 2009).
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●
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Evidence that Levosimendan Improves Renal Function in Septic Shock Patients.
In a study of 28 patients with septic shock levosimendan increased creatinine clearance by 64% compared to dobutamine (Morelli 2005). Similarly, a retrospective analysis of 99 patients with septic shock who received levosimendan within 36 hours of admission to the ICU (Morelli 2009), showed levosimendan-treated patients demonstrated a 24% increase in glomerular filtration rate at 96 hours together with a reduced peak serum creatinine, when compared to matched controls.
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●
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Evidence that Levosimendan Improves Splanchnic/ Liver Perfusion
. One trial of 28 septic shock patients indicated that levosimendan compared to dobutamine increase gastric mucosal blood flow (Morelli 2005). Another trial of 30 patients showed improved hepatic perfusion as measured by indocyanine green clearance, with levosimendan compared to dobutamine (Memis 2012).
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●
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Evidence that Levosimendan Improves Mitochondrial Function
. A study of 26 septic shock patients provides evidence that the unique K-ATP channel mechanism of levosimendan may protect mitochondria from the significant oxidative stress that can occur in septic shock patients (Morelli 2014).
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–
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three U.S. patents (5,824,703; 5,840,767; 6,167,887), and one Australian patents (759,557) pertaining to the use and application of PFCs as gas transport agents in blood substitutes and liquid ventilation with an average remaining life of approximately 2 years;
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–
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exclusive in-licenses to three fundamental gas transport patent applications that represent the core technology used in our products and product candidates (other than levosimendan) with an average remaining life of approximately 14 years; and
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–
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one U.S. patent (8,513,309) and numerous patent applications for treatment of several medical and dermatological conditions such as TBI, acne, burns and wounds with an average remaining life of approximately 15 years.
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–
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methods to treat certain diseases and conditions and for biological gas exchange;
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–
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therapies for burn and wound victims;
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–
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delivery of oxygenated PFC;
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–
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various formulations containing PFC; and
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–
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methods and compositions for controlled and sustained production and delivery of peroxide and/or oxygen for biological and industrial applications.
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-
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our ability to obtain additional funding to develop our product candidates;
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the need to obtain regulatory approval of our most advanced product candidates;
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potential risks related to any collaborations we may enter into for our product candidates;
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delays in the commencement, enrollment and completion of clinical testing, as well as the analysis and reporting of results from such clinical testing;
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the success of clinical trials of our levosimendan product candidates or future product candidates;
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any delays in regulatory review and approval of product candidates in development;
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our ability to establish an effective sales and marketing infrastructure;
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competition from existing products or new products that may emerge;
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the ability to receive regulatory approval or commercialize our products;
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potential side effects of our product candidates that could delay or prevent commercialization;
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potential product liability claims and adverse events;
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potential liabilities associated with hazardous materials;
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our ability to maintain adequate insurance policies;
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our dependency on third-party manufacturers to supply or manufacture our products;
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our ability to establish or maintain collaborations, licensing or other arrangements;
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our ability, our partners’ abilities, and third parties’ abilities to protect and assert intellectual property rights;
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costs related to and outcomes of potential litigation;
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compliance with obligations under intellectual property licenses with third parties;
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our ability to adequately support future growth; and
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our ability to attract and retain key personnel to manage our business effectively.
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the scope, rate of progress and cost of our clinical trials and other research and development activities;
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the costs and timing of regulatory approval;
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the costs of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights;
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the effect of competing technological and market developments;
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the terms and timing of any collaboration, licensing or other arrangements that we may establish;
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the cost and timing of completion of clinical and commercial-scale manufacturing activities; and
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the costs of establishing sales, marketing and distribution capabilities for our cosmetic products and any product candidates for which we may receive regulatory approval.
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we may not be able to control the amount and timing of resources that our partners may devote to the development or commercialization of our product candidates or to their marketing and distribution;
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partners may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing;
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disputes may arise between us and our partners that result in the delay or termination of the research, development or commercialization of our product candidates or that result in costly litigation or arbitration that diverts management’s attention and resources;
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partners may experience financial difficulties;
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partners may not properly maintain or defend our intellectual property rights, or may use our proprietary information, in such a way as to invite litigation that could jeopardize or invalidate our intellectual property rights or proprietary information or expose us to potential litigation;
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business combinations or significant changes in a partner’s business strategy may adversely affect a partner’s willingness or ability to meet its obligations under any arrangement;
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a partner could independently move forward with a competing product candidate developed either independently or in collaboration with others, including our competitors; and
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the collaborations with our partners may be terminated or allowed to expire, which would delay the development and may increase the cost of developing our product candidates.
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reaching agreements on acceptable terms with prospective trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among trial sites;
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obtaining institutional review board, or IRB, approval to conduct a clinical trial at numerous prospective sites;
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recruiting and enrolling patients to participate in clinical trials for a variety of reasons, including meeting the enrollment criteria for our study and competition from other clinical trial programs for the same indication as our product candidates;
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maintaining and supplying clinical trial material on a timely basis; and
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collecting, analyzing and reporting final data from the clinical trials.
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failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols;
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inspection of the clinical trial operations or trial sites by the FDA or other regulatory authorities resulting in the imposition of a clinical hold;
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unforeseen safety issues or any determination that a trial presents unacceptable health risks; and
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lack of adequate funding to continue the clinical trial, including unforeseen costs due to enrollment delays, requirements to conduct additional trials and studies and increased expenses associated with the services of our contract research organizations, or CROs, and other third parties.
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the data obtained from laboratory testing and clinical trials are susceptible to varying interpretations, which could delay, limit or prevent FDA and other regulatory approvals;
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adverse events could cause the FDA and other regulatory authorities to halt trials;
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at any time the FDA and other regulatory agencies could change policies and regulations that could result in delay and perhaps rejection of our products; and
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even after extensive testing and clinical trials, there is no assurance that regulatory approval will ever be obtained for any of our products.
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the federal anti-kickback statute is a criminal statute that makes it a felony for individuals or entities knowingly and willfully to offer or pay, or to solicit or receive, direct or indirect remuneration, in order to induce the purchase, order, lease, or recommending of items or services, or the referral of patients for services, that are reimbursed under a federal health care program, including Medicare and Medicaid;
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the federal False Claims Act imposes liability on any person who knowingly submits, or causes another person or entity to submit, a false claim for payment of government funds. Penalties include three times the government’s damages plus civil penalties of $5,500 to $11,000 per false claim. In addition, the False Claims Act permits a person with knowledge of fraud, referred to as a qui tam plaintiff, to file a lawsuit on behalf of the government against the person or business that committed the fraud, and, if the action is successful, the qui tam plaintiff is rewarded with a percentage of the recovery;
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health Insurance Portability and Accountability Act imposes obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information;
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the Social Security Act contains numerous provisions allowing the imposition of a civil money penalty, a monetary assessment, exclusion from the Medicare and Medicaid programs, or some combination of these penalties; and
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many states have analogous state laws and regulations, such as state anti-kickback and false claims laws. In some cases, these state laws impose more strict requirements than the federal laws. Some state laws also require pharmaceutical companies to comply with certain price reporting and other compliance requirements.
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our inability to recruit and retain adequate numbers of effective sales and marketing personnel;
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the inability of sales personnel to obtain access to or persuade adequate numbers of physicians to prescribe our products;
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the lack of complementary products to be offered by sales personnel, which may put us at a competitive disadvantage relative to companies with more extensive product lines; and
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unforeseen costs and expenses associated with creating and sustaining an independent sales and marketing organization.
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we may be required to relinquish important rights to our products or product candidates;
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we may not be able to control the amount and timing of resources that our distributors or collaborators may devote to the commercialization of our product candidates;
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our distributors or collaborators may experience financial difficulties;
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our distributors or collaborators may not devote sufficient time to the marketing and sales of our products; and
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business combinations or significant changes in a collaborator’s business strategy may adversely affect a collaborator’s willingness or ability to complete its obligations under any arrangement.
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others may be able to make compositions or formulations that are similar to our product candidates but that are not covered by the claims of our patents;
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we might not have been the first to make the inventions covered by our issued patents or pending patent applications;
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we might not have been the first to file patent applications for these inventions;
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others may independently develop similar or alternative technologies or duplicate any of our technologies;
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it is possible that our pending patent applications will not result in issued patents;
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our issued patents may not provide us with any competitive advantages, or may be held invalid or unenforceable as a result of legal challenges by third parties;
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we may not develop additional proprietary technologies that are patentable; or
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the patents of others may have an adverse effect on our business.
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these agreements may be breached;
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these agreements may not provide adequate remedies for the applicable type of breach; or
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our trade secrets or proprietary know-how will otherwise become known.
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decreased demand for our products and any product candidates that we may develop;
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injury to our reputation;
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withdrawal of clinical trial participants;
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costs to defend the related litigation;
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substantial monetary awards to trial participants or patients;
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loss of revenue; and
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the inability to commercialize any products that we may develop.
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actual or anticipated fluctuations in our financial condition and operating results;
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status and/or results of our clinical trials;
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status of ongoing litigation;
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results of clinical trials of our competitors’ products;
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regulatory actions with respect to our products or our competitors’ products;
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actions and decisions by our collaborators or partners;
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actual or anticipated changes in our growth rate relative to our competitors;
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actual or anticipated fluctuations in our competitors’ operating results or changes in their growth rate;
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competition from existing products or new products that may emerge;
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issuance of new or updated research or reports by securities analysts;
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fluctuations in the valuation of companies perceived by investors to be comparable to us;
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share price and volume fluctuations attributable to inconsistent trading volume levels of our shares;
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market conditions for biopharmaceutical stocks in general;
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status of our search and selection of future management and leadership; and
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general economic and market conditions.
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Year-Ended April 30, 2014
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High
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Low
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||||||
First Quarter
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$ | 5.69 | $ | 1.40 | ||||
Second Quarter
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$ | 3.46 | $ | 1.19 | ||||
Third Quarter
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$ | 11.40 | $ | 3.04 | ||||
Fourth Quarter
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$ | 8.35 | $ | 4.46 |
Year-Ended April 30, 2015
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High
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Low
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||||||
First Quarter
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$ | 5.18 | $ | 3.60 | ||||
Second Quarter
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$ | 4.40 | $ | 3.34 | ||||
Third Quarter
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$ | 4.76 | $ | 3.01 | ||||
Fourth Quarter
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$ | 3.54 | $ | 2.88 |
Transition Period Ended December 31, 2015
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High
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Low
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||||||
First Quarter
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$ | 3.88 | $ | 3.26 | ||||
Second Quarter
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$ | 3.98 | $ | 2.88 | ||||
Two Month Ended December 31, 2015
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$ | 3.40 | $ | 2.98 |
4/30/2010
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4/30/2011
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4/30/2012
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4/30/2013
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4/30/2014
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4/30/2015
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12/31/2015
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||||||||||||||||||||||
Tenax Therapeutics, Inc.
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$ | 100.00 | $ | 35.40 | $ | 35.60 | $ | 5.00 | $ | 4.88 | $ | 3.42 | $ | 3.28 | ||||||||||||||
Nasdaq Composite
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100.00 | 116.75 | 123.78 | 135.25 | 167.18 | 200.77 | 203.45 | |||||||||||||||||||||
Nasdaq Biotechnology
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100.00 | 117.78 | 137.44 | 188.87 | 252.38 | 361.71 | 370.85 | |||||||||||||||||||||
S&P Global Healthcare
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100.00 | 116.48 | 120.12 | 152.26 | 181.73 | 214.33 | 204.22 |
Eight Months Ended December 31,
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Fiscal Year Ended April 30,
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|||||||||||||||||||||||||||
2015
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2014
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2015
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2014
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2013
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2012
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2011
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||||||||||||||||||||||
(Unaudited)
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||||||||||||||||||||||||||||
Statements of Operations Data:
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||||||||||||||||||||||||||||
Total net revenue
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$ | - | $ | - | $ | 49,286 | $ | 158,926 | $ | 1,190,928 | $ | 363,781 | $ | 103,167 | ||||||||||||||
Operating loss
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(10,425,498 | ) | (8,680,309 | ) | (14,816,743 | ) | (16,611,120 | ) | (5,189,072 | ) | (8,220,197 | ) | (10,562,677 | ) | ||||||||||||||
Net loss
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(10,067,964 | ) | (8,217,625 | ) | (14,081,812 | ) | (19,541,839 | ) | (9,415,800 | ) | (15,712,410 | ) | (10,448,296 | ) | ||||||||||||||
Diluted net loss per share (1)
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(0.36 | ) | (0.29 | ) | (0.50 | ) | (2.71 | ) | (6.68 | ) | (14.07 | ) | (8.95 | ) | ||||||||||||||
Balance Sheet Data:
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||||||||||||||||||||||||||||
Cash, short-term and long-term investments
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38,208,001 | 51,388,762 | 48,101,534 | 58,320,555 | 783,528 | 1,879,872 | 951,944 | |||||||||||||||||||||
Total assets
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72,987,078 | 87,484,111 | 82,908,344 | 93,429,440 | 3,180,643 | 4,141,934 | 2,922,356 | |||||||||||||||||||||
Long-term liabilities
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7,962,100 | 7,962,100 | 7,962,100 | 7,973,032 | 3,049,102 | 1,361,110 | 4,463,635 | |||||||||||||||||||||
Accumulated deficit
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(160,735,699 | ) | (144,962,323 | ) | (150,667,735 | ) | (136,585,923 | ) | (117,044,084 | ) | (107,628,284 | ) | (91,915,874 | ) | ||||||||||||||
Total stockholders’ equity (deficit)
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60,423,348 | 76,004,387 | 70,429,034 | 82,885,361 | (1,778,036 | ) | (346,046 | ) | (3,724,523 | ) | ||||||||||||||||||
Statements of Cash Flows Data:
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||||||||||||||||||||||||||||
Net cash flows from operating activities
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(8,950,610 | ) | (6,632,268 | ) | (9,748,794 | ) | (9,261,571 | ) | (4,921,283 | ) | (8,278,366 | ) | (8,403,142 | ) |
(1)
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Computed as described in Note B to our consolidated financial statements included in this report.
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Eight months ended December 31,
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Increase/ (Decrease)
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% Increase/ (Decrease)
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||||||||||||||
2015
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2014
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|||||||||||||||
Personnel costs
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$ | 1,998,627 | $ | 1,715,577 | $ | 283,050 | 16 | % | ||||||||
Legal and professional fees
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1,314,303 | 2,166,977 | (852,674 | ) | (39 | ) % | ||||||||||
Other costs
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502,345 | 369,193 | 133,152 | 36 | % | |||||||||||
Facilities
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102,421 | 110,011 | (7,590 | ) | (7 | ) % | ||||||||||
Depreciation and amortization
|
22,935 | 78,084 | (55,149 | ) | (71 | ) % |
●
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Costs associated with investor relations and communications decreased approximately $912,000 in the current period. This decrease was due primarily to the recognition of approximately $475,000 for the fair value of warrants issued to a third party investor relations firm during the same period in the prior year as well as a reduction of approximately $437,000 in fees paid in the prior year to third party investor relations firms for providing marketing and corporate communications services to us in the current period.
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●
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Board of Directors fees decreased in the current period by approximately $64,000. This decrease was due primarily to a reduction in the recognized expense for the vesting of stock options awarded in the current period as compared to the recognized expense for stock options awarded in the same period of the prior year.
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●
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Consulting costs increased approximately $87,000 due to the costs incurred for market research and commercial development services during the current period that were not incurred during the same period in the prior year.
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Eight months ended December 31,
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Increase/ (Decrease)
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% Increase/ (Decrease)
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||||||||||||||
2015
|
2014
|
|||||||||||||||
Clinical and preclinical development
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$ | 5,560,860 | $ | 3,820,196 | $ | 1,740,664 | 46 | % | ||||||||
Consulting
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470,335 | 15,231 | 455,104 | 2988 | % | |||||||||||
Personnel costs
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427,873 | 359,129 | 68,744 | 19 | % | |||||||||||
Other costs
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25,799 | 45,911 | (20,112 | ) | (44 | ) % |
Eight months ended December 31,
|
Increase/ (Decrease)
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% Increase/ (Decrease)
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||||||||||||||
2015
|
2014
|
|||||||||||||||
Interest expense
|
$ | 1,507 | $ | 46,736 | $ | (45,229 | ) | (97 | ) % |
Eight months ended December 31,
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(Increase)/ Decrease
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|||||||||||
2015
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2014
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|||||||||||
Other (income) expense, net
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$ | (359,041 | ) | $ | (509,420 | ) | $ | 150,379 |
Year ended April 30,
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Increase/ (Decrease)
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% Increase/ (Decrease)
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||||||||||||||
2015
|
2014
|
|||||||||||||||
Product revenue
|
$ | - | $ | 25,731 | $ | (25,731 | ) | (100 | ) % | |||||||
Cost of sales
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- | 129,800 | (129,800 | ) | (100 | ) % | ||||||||||
Gross profit
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$ | - | $ | (104,069 | ) | $ | 104,069 | (100 | ) % |
Year ended April 30,
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Increase/ (Decrease)
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% Increase/ (Decrease)
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||||||||||||||
2015
|
2014
|
|||||||||||||||
Government grant revenue
|
$ | 49,286 | $ | 262,995 | $ | (213,709 | ) | (81 | ) % |
Year ended April 30,
|
Increase/ (Decrease)
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% Increase/ (Decrease)
|
||||||||||||||
2015
|
2014
|
|||||||||||||||
Legal and professional fees
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$ | 3,017,584 | $ | 2,556,643 | $ | 460,941 | 18 | % | ||||||||
Personnel costs
|
2,986,589 | 10,593,234 | (7,606,645 | ) | (72 | ) % | ||||||||||
Other costs
|
890,940 | 350,855 | 540,085 | 154 | % | |||||||||||
Facilities
|
160,818 | 157,449 | 3,369 | 2 | % | |||||||||||
Depreciation and amortization
|
114,848 | 115,042 | (194 | ) | (0 | ) % |
-
|
Costs associated with investor relations and communication increased approximately $636,000 in the year ended April 30, 2015. This increase was due primarily to the issuance of 175,000 warrants with a calculated fair value of approximately $475,000 and an increase of approximately $161,000 in fees paid to outsourced corporate communication firms for investor relations services and website development.
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-
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Board of Directors fees increased in the year ended April 30, 2015 by approximately $420,000. This increase was due primarily to approximately $280,000 in recognized expense for the vesting of stock options awarded and an increase of approximately $140,000 in fees paid due to the addition of a director and the restructuring of directors’ fees in the year ended April 30, 2015.
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-
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Consulting costs increased approximately $132,000 in the year ended April 30, 2015 due primarily to fees paid for recruiting firms for placement services and contract labor in the year ended April 30, 2015.
|
-
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Legal, accounting and capital market fees decreased in the year ended April 30, 2015 by approximately $600,000. This decrease was due primarily to a reduction of approximately $530,000 in accounting and legal fees incurred in the year ended April 30, 2014 related to the acquisition of the rights to develop levosimendan and the issuance of our Series C and Series D Preferred Stock and a reduction of approximately $70,000 in fees paid for the listing of additional shares with Nasdaq and SEC filings made during the year ended April 30, 2014.
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-
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Stock based compensation and the vested value of issued stock options decreased approximately $8.3 million in the year ended April 30, 2015 due primarily to the expense recognition of approximately $8.3 million for the granting and vesting of stock options and restricted stock in the year ended April 30, 2014. These option grants were made pursuant to employment agreements, which were negotiated in connection with our acquisition of a license for levosimendan in November 2013.
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-
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Salaries and benefits increased approximately $633,000 in the year ended April 30, 2015. This increase was due primarily to full-year salaries paid in the year ended April 30, 2015 to our Chief Executive Officer and the two additional management positions added in connection with our acquisition of certain assets of Phyxius, and approximately $210,000 for severance payments related to the stoppage of Oxycyte development programs.
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Year ended April 30,
|
Increase/ (Decrease)
|
% Increase/ (Decrease)
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||||||||||||||
2015
|
2014
|
|||||||||||||||
Clinical and preclinical development
|
$ | 6,034,702 | $ | 1,947,461 | $ | 4,087,241 | 210 | % | ||||||||
Personnel costs
|
525,561 | 818,264 | (292,703 | ) | (36 | ) % | ||||||||||
Consulting
|
35,106 | 153,506 | (118,400 | ) | (77 | ) % | ||||||||||
Depreciation
|
33,292 | 35,447 | (2,155 | ) | (6 | ) % | ||||||||||
Other costs
|
27,287 | 31,780 | (4,493 | ) | (14 | ) % | ||||||||||
Facilities
|
4,439 | 10,263 | (5,824 | ) | (57 | ) % |
Year ended April 30,
|
Increase/ (Decrease)
|
% Increase/ (Decrease)
|
||||||||||||||
2015
|
2014
|
|||||||||||||||
Interest expense
|
$ | 49,081 | $ | 2,212,283 | $ | (2,163,202 | ) | (98 | ) % |
Year ended April 30,
|
(Increase)/ Decrease
|
|||||||||||
2015
|
2014
|
|||||||||||
Other (income) expense, net
|
$ | (784,012 | ) | $ | 718,436 | $ | (1,502,448 | ) |
Year ended April 30,
|
Increase/ (Decrease)
|
% Increase/ (Decrease)
|
||||||||||||||
2014
|
2013
|
|||||||||||||||
Product revenue
|
$ | 25,731 | $ | 92,683 | $ | (66,952 | ) | (72 | ) % | |||||||
Cost of sales
|
129,800 | 43,111 | 86,689 | 201 | % | |||||||||||
Gross profit
|
$ | (104,069 | ) | $ | 49,572 | $ | (153,641 | ) | (310 | ) % |
Year ended April 30,
|
Increase/ (Decrease)
|
% Increase/ (Decrease)
|
||||||||||||||
2014
|
2013
|
|||||||||||||||
Government grant revenue
|
$ | 262,995 | $ | 1,141,356 | $ | (878,361 | ) | (77 | ) % |
Year ended April 30,
|
Increase/ (Decrease)
|
% Increase/ (Decrease)
|
||||||||||||||
2014
|
2013
|
|||||||||||||||
Marketing and sales expense
|
$ | 102 | $ | 108,165 | $ | (108,063 | ) | (100 | ) % |
Year ended April 30,
|
Increase/ (Decrease)
|
% Increase/ (Decrease)
|
||||||||||||||
2014
|
2013
|
|||||||||||||||
Personnel costs
|
$ | 10,593,234 | $ | 1,490,752 | $ | 9,102,482 | 611 | % | ||||||||
Legal and professional fees
|
2,556,643 | 2,005,311 | 551,332 | 27 | % | |||||||||||
Other costs
|
350,855 | (206,788 | ) | 557,643 | 270 | % | ||||||||||
Facilities
|
157,449 | 167,693 | (10,244 | ) | (6 | ) % | ||||||||||
Depreciation and amortization
|
115,042 | 111,012 | 4,030 | 4 | % |
-
|
Audit and accounting fees increased approximately $55,000 due to the costs incurred for valuation services related to the Phyxius acquisition and the filing of registration statements in the year ended April 30, 2014.
|
-
|
Investor relation fees increased approximately $560,000 for the costs of outsourced corporate communications firms, road shows and attending investor conferences.
|
-
|
Legal fees decreased approximately $40,000 due primarily to approximately $285,000 in fees incurred in the year ended April 30, 2013 for litigation defense costs, partially offset by an increase of approximately $245,000 in fees related to the Phyxius acquisition and the filing of registration statements in the year ended April 30, 2014.
|
-
|
Recruiting fees decreased approximately $25,000 due to headcount additions in the year ended April 30, 2013.
|
Year ended April 30,
|
Increase/
|
% Increase/
|
||||||||||||||
2014
|
2013
|
(Decrease) | (Decrease) | |||||||||||||
Clinical and preclinical development
|
$ | 1,947,461 | $ | 1,569,594 | $ | 377,867 | 24 | % | ||||||||
Personnel costs
|
818,264 | 637,685 | 180,579 | 28 | % | |||||||||||
Consulting
|
153,506 | 117,211 | 36,295 | 31 | % | |||||||||||
Depreciation
|
41,199 | 42,968 | (1,769 | ) | (4 | ) % | ||||||||||
Other costs
|
26,028 | 32,652 | (6,624 | ) | (20 | ) % | ||||||||||
Facilities
|
10,263 | 55,706 | (45,443 | ) | (82 | ) % |
Year ended April 30,
|
Increase/
|
% Increase/
|
||||||||||||||
2014
|
2013
|
(Decrease) | (Decrease) | |||||||||||||
Restructuring expense
|
$ | - | $ | 220,715 | $ | (220,715 | ) | — | % |
Year ended April 30,
|
Increase/
|
% Increase/
|
||||||||||||||
2014
|
2013
|
(Decrease) | (Decrease) | |||||||||||||
Interest expense
|
$ | 2,212,283 | $ | 4,238,456 | $ | (2,026,173 | ) | (48 | ) % |
Year ended April 30,
|
Increase/
|
|||||||||||
2014
|
2013
|
(Decrease) | ||||||||||
Other expense (income), net
|
$ | 718,436 | $ | (11,683 | ) | $ | 730,119 |
Eight months ended December 31,
|
||||||||
2015
|
2014
|
|||||||
Net cash used in operating activities
|
$ | (8,950,610 | ) | $ | (6,632,268 | ) | ||
Net cash used in investing activities
|
4,784,732 | (40,356,616 | ) | |||||
Net cash provided by financing activities
|
(100,160 | ) | 344,654 |
Year ended April 30,
|
||||||||
2015
|
2014
|
|||||||
Net cash used in operating activities
|
$ | (9,748,794 | ) | $ | (9,261,571 | ) | ||
Net cash provided by (used in) investing activities
|
(40,925,860 | ) | (147,038 | ) | ||||
Net cash (used in) provided by financing activities
|
280,590 | 66,945,636 |
Year ended April 30,
|
||||||||
2014
|
2013
|
|||||||
Net cash used in operating activities
|
$ | (9,261,571 | ) | $ | (4,921,283 | ) | ||
Net cash provided by (used in) investing activities
|
(147,038 | ) | (147,987 | ) | ||||
Net cash (used in) provided by financing activities
|
66,945,636 | 3,972,926 |
-
|
The initiation, progress, timing and completion of clinical trials for our product candidates and potential product candidates;
|
-
|
The outcome, timing and cost of regulatory approvals and the regulatory approval process;
|
-
|
Delays that may be caused by changing regulatory requirements;
|
-
|
The number of product candidates that we pursue;
|
-
|
The costs involved in filing and prosecuting patent applications and enforcing and defending patent claims;
|
-
|
The timing and terms of future in-licensing and out-licensing transactions;
|
-
|
The cost and timing of establishing sales, marketing, manufacturing and distribution capabilities;
|
-
|
The cost of procuring clinical and commercial supplies of our product candidates;
|
-
|
The extent to which we acquire or invest in businesses, products or technologies; and
|
-
|
The possible costs of litigation.
|
Payments Due by Period
|
||||||||||||||||||||
Less than
|
More than
|
|||||||||||||||||||
Total
|
1 Year
|
1-3 Years
|
3-5 Years
|
5 Years
|
||||||||||||||||
Operating Lease Obligations
|
$ | 602,713 | $ | 74,058 | $ | 345,768 | $ | 182,887 | $ | - |
-
|
Fees paid to CROs in connection with clinical trials,
|
-
|
Fees paid to research institutions in conjunction with preclinical research studies, and
|
-
|
Fees paid to contract manufacturers and service providers in connection with the production and testing of active pharmaceutical ingredients and drug materials for use in preclinical studies and clinical trials.
|
CONSOLIDATED BALANCE SHEETS
|
43
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
|
44
|
|
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
|
45
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
46
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS, continued
|
47
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
48
|
December 31,
2015
|
April 30,
2015
|
April 30,
2014
|
||||||||||
ASSETS
|
||||||||||||
Current assets
|
||||||||||||
Cash and cash equivalents
|
$ | 3,660,453 | $ | 7,926,491 | $ | 58,320,555 | ||||||
Marketable securities
|
16,528,494 | 9,200,082 | - | |||||||||
Accounts receivable
|
49,448 | 76,475 | 36,358 | |||||||||
Government grant receivable
|
- | - | 29,750 | |||||||||
Prepaid expenses
|
321,958 | 249,505 | 401,964 | |||||||||
Other current assets
|
- | 58,623 | 177,406 | |||||||||
Total current assets
|
20,560,353 | 17,511,176 | 58,966,033 | |||||||||
Marketable securities
|
18,019,054 | 30,974,961 | - | |||||||||
Property and equipment, net
|
35,786 | 50,322 | 124,374 | |||||||||
Debt issuance costs, net
|
- | - | 21,427 | |||||||||
Intangible assets, net
|
22,000,000 | 22,000,000 | 22,999,744 | |||||||||
Goodwill
|
11,265,100 | 11,265,100 | 11,265,100 | |||||||||
Other assets
|
1,106,785 | 1,106,785 | 52,762 | |||||||||
Total assets
|
$ | 72,987,078 | $ | 82,908,344 | $ | 93,429,440 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||||||
Current liabilities
|
||||||||||||
Accounts payable
|
$ | 972,483 | $ | 1,183,939 | $ | 411,145 | ||||||
Accrued liabilities
|
3,104,807 | 2,660,666 | 858,136 | |||||||||
Warrant liabilities
|
524,340 | 572,445 | 954,876 | |||||||||
Notes payable, net
|
- | 100,160 | 346,890 | |||||||||
Total current liabilities
|
4,601,630 | 4,517,210 | 2,571,047 | |||||||||
Other liabilities
|
- | - | 10,932 | |||||||||
Deferred tax liability
|
7,962,100 | 7,962,100 | 7,962,100 | |||||||||
Total liabilities
|
12,563,730 | 12,479,310 | 10,544,079 | |||||||||
Commitments and contingencies; see Note I
|
||||||||||||
Stockholders' equity
|
||||||||||||
Preferred stock, undesignated, authorized 10,000,000 and 10,000,000 and 9,947,439 shares; respectively, See Note G.
|
- | - | - | |||||||||
Common stock, par value $.0001 per share; authorized 400,000,000 shares; issued and outstanding 28,119,694 and 28,119,520 and 27,858,000, respectively
|
2,812 | 2,812 | 2,786 | |||||||||
Additional paid-in capital
|
221,285,677 | 221,067,239 | 219,468,498 | |||||||||
Accumulated other comprehensive (loss) gain
|
(129,442 | ) | 26,718 | - | ||||||||
Accumulated deficit
|
(160,735,699 | ) | (150,667,735 | ) | (136,585,923 | ) | ||||||
Total stockholders’ equity
|
60,423,348 | 70,429,034 | 82,885,361 | |||||||||
Total liabilities and stockholders' equity
|
$ | 72,987,078 | $ | 82,908,344 | $ | 93,429,440 |
Eight months ended December 31,
|
Year ended April 30, | |||||||||||||||
2015
|
2015
|
2014
|
2013
|
|||||||||||||
Product revenue
|
$ | - | $ | - | $ | 25,731 | $ | 92,683 | ||||||||
Cost of sales
|
- | - | 129,800 | 43,111 | ||||||||||||
Net product revenue
|
- | - | (104,069 | ) | 49,572 | |||||||||||
Government grant revenue
|
- | 49,286 | 262,995 | 1,141,356 | ||||||||||||
Total net revenue
|
- | 49,286 | 158,926 | 1,190,928 | ||||||||||||
Operating expenses
|
||||||||||||||||
General and administrative
|
3,940,631 | 7,170,779 | 13,773,325 | 3,676,145 | ||||||||||||
Research and development
|
6,484,867 | 6,660,387 | 2,996,721 | 2,455,816 | ||||||||||||
Restructuring expense
|
- | - | - | 220,715 | ||||||||||||
Loss on impairment of long-lived assets
|
- | 1,034,863 | - | 27,279 | ||||||||||||
Total operating expenses
|
10,425,498 | 14,866,029 | 16,770,046 | 6,379,955 | ||||||||||||
Net operating loss
|
10,425,498 | 14,816,743 | 16,611,120 | 5,189,027 | ||||||||||||
Interest expense
|
1,507 | 49,081 | 2,212,283 | 4,238,456 | ||||||||||||
Other (income) expense
|
(359,041 | ) | (784,012 | ) | 718,436 | (11,683 | ) | |||||||||
Net loss
|
$ | 10,067,964 | $ | 14,081,812 | $ | 19,541,839 | $ | 9,415,800 | ||||||||
Unrealized loss (gain) on marketable securities
|
156,160 | (26,718 | ) | - | - | |||||||||||
Total comprehensive loss
|
$ | 10,224,124 | $ | 14,055,094 | $ | 19,541,839 | $ | 9,415,800 | ||||||||
Reconciliation of net loss to net loss attributable to common stockholders
|
||||||||||||||||
Net loss
|
$ | 10,067,964 | $ | 14,081,812 | $ | 19,541,839 | $ | 9,415,800 | ||||||||
Preferred stock dividend
|
- | - | 5,803,362 | 958,071 | ||||||||||||
Net loss attributable to common stockholders
|
$ | 10,067,964 | $ | 14,081,812 | $ | 25,345,201 | $ | 10,373,871 | ||||||||
Net loss per share, basic
|
$ | (0.36 | ) | $ | (0.50 | ) | $ | (2.71 | ) | $ | (6.29 | ) | ||||
Weighted average number of common shares outstanding, basic
|
28,119,597 | 28,077,963 | 9,362,031 | 1,650,280 | ||||||||||||
Net loss per share, diluted
|
$ | (0.36 | ) | $ | (0.50 | ) | $ | (2.71 | ) | $ | (6.68 | ) | ||||
Weighted average number of common shares outstanding, diluted
|
28,119,597 | 28,077,963 | 9,362,031 | 1,759,025 |
Preferred Stock
|
Common Stock
|
Accumulated other comprehensive gain
|
Accumulated
|
Total stockholders'
|
||||||||||||||||||||||||||||
Number of Shares
|
Amount
|
Number of Shares
|
Amount
|
Additional paid-in capital
|
(loss) | deficit | equity | |||||||||||||||||||||||||
Balance at April 30, 2012
|
- | $ | - | 1,470,890 | $ | 2,942 | $ | 107,279,296 | $ | - | $ | (107,628,284 | ) | $ | (346,046 | ) | ||||||||||||||||
Preferred stock sold, net of offering costs
|
2,100 | 1 | 1,851,149 | 1,851,150 | ||||||||||||||||||||||||||||
Common stock issued for convertible preferred stock
|
(1,113 | ) | 400,708 | 804 | 4,509,184 | 4,509,988 | ||||||||||||||||||||||||||
Common stock issued as interest on convertible debt
|