X
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
[ ]
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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20-578559
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(State or Other Jurisdiction
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(I.R.S. Employer
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of Incorporation or Organization)
|
Identification No.)
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19805 North Creek Parkway, Bothell, WA
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98011
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(Address of Principal Executive Office)
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(Zip Code)
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Large accelerated filer
|
[ ]
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Accelerated filer
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[ ]
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Non-accelerated filer
|
[ ]
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Smaller reporting company
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[X]
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Page
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Part I.
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Business
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1
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6
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6
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6
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7
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7
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Part II.
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7
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8
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8
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28
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28
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29
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29
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30
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Part III.
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30
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30
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30
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30
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30
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Part IV.
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||||
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31
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|||||
32
|
(1)
|
Selection of viral drug targets amenable to broad spectrum antiviral drug development and essential for viral genome replication;
|
(2)
|
Proprietary nucleoside chemistry;
|
(3)
|
Atomic resolution 3-D structure determination of drug binding pockets;
|
(4)
|
In-depth computational analysis of conservation of drug-binding pockets and critical molecular interactions between antiviral inhibitors and amino acid residues of the target molecule’s drug-binding pocket;
|
(5)
|
Cocrystal structure determinations to inform hit identification, hit-to-lead, and lead optimization processes;
|
(6)
|
Molecular modeling and computer-guided lead discovery to support rational chemical modifications based on structure-activity relationships, or SAR, of candidate inhibitor compounds;
|
(7)
|
Knowledge of enzymatic mechanisms to guide the design of drugs with exceptional affinity, specificity, and broad spectrum activity; and
|
(8)
|
Platforms for rapid identification of antiviral enzyme inhibitors showing broad spectrum antiviral capability.
|
(1)
|
Good safety and tolerability profile;
|
(2)
|
Effective against all viral subtypes that cause disease;
|
(3)
|
High barrier to viral resistance; and
|
(4)
|
Ease of administration, for example, a pill.
|
High
|
Low
|
|||||||
Year ended December 31, 2014
|
||||||||
January 1, 2014 through March 31, 2014
|
$
|
0.598
|
$
|
0.33
|
||||
April 1, 2014 through June 30, 2014
|
$
|
0.44
|
$
|
0.252
|
||||
July 1, 2014 through September 30, 2014
|
$
|
0.595
|
$
|
0.265
|
||||
October 1, 2014 through December 31, 2014
|
$
|
0.739
|
$
|
0.52
|
||||
Year ended December 31, 2013
|
||||||||
January 1, 2013 through March 31, 2013
|
$
|
3.75
|
$
|
1.01
|
||||
April 1, 2013 through June 30, 2013
|
$
|
1.05
|
$
|
0.21
|
||||
July 1, 2013 through September 30, 2013
|
$
|
0.85
|
$
|
0.16
|
||||
October 1, 2013 through December 31, 2013
|
$
|
0.97
|
$
|
0.23
|
·
|
identifying and validating new therapeutic strategies;
|
·
|
completing our research and preclinical development of product candidates;
|
·
|
initiating and completing clinical trials for product candidates;
|
·
|
seeking and obtaining marketing approvals for product candidates that successfully complete clinical trials;
|
·
|
establishing and maintaining supply and manufacturing relationships with third parties;
|
·
|
launching and commercializing product candidates for which we obtain marketing approval, with a partner or, if launched independently, successfully establishing a sales force, marketing and distribution infrastructure;
|
·
|
maintaining, protecting, enforcing, defending and expanding our intellectual property portfolio; and
|
·
|
attracting, hiring and retaining qualified personnel.
|
·
|
significantly delay, scale back or discontinue the development or commercialization of any product candidates;
|
·
|
seek strategic alliances for research and development programs at an earlier stage than otherwise would be desirable or on terms less favorable than might otherwise be available; or
|
·
|
relinquish or license on unfavorable terms, our rights to technologies or any product candidates we otherwise would seek to develop or commercialize ourselves.
|
·
|
our research methodology or that of our partners may be unsuccessful in identifying potential product candidates;
|
·
|
potential product candidates may have harmful side effects or may have other characteristics that may make the products unmarketable or unlikely to receive marketing approval; and
|
·
|
we or our partners may change their development profiles for potential product candidates or abandon a therapeutic area.
|
·
|
successful completion of preclinical studies and clinical trials;
|
·
|
receipt of marketing approvals from regulatory authorities;
|
·
|
obtaining and maintaining patent and trade secret protection for product candidates;
|
·
|
establishing and maintaining manufacturing relationships with third parties or establishing our own manufacturing capability; and
|
·
|
commercializing our products, if and when approved, whether alone or in collaboration with others.
|
·
|
delays in agreeing with the FDA or other regulatory authorities on final clinical trial design;
|
·
|
imposition of a clinical hold following an inspection of our clinical trial operations or trial sites by the FDA or other regulatory authorities;
|
·
|
delays in agreeing on acceptable terms with prospective contract research organizations, or CROs, and clinical trial sites;
|
·
|
delays in obtaining required institutional review board approval at each clinical trial site;
|
·
|
delays in recruiting suitable patients to participate in a trial;
|
·
|
delays in the testing, validation, manufacturing and delivery of the product candidates to the clinical sites;
|
·
|
delays in having patients complete participation in a trial or return for post-treatment follow-up;
|
·
|
delays caused by patients dropping out of a trial due to product side effects or disease progression;
|
·
|
clinical sites dropping out of a trial to the detriment of enrollment;
|
·
|
time required to add new clinical sites; or
|
·
|
delays by our contract manufacturers in producing and delivering sufficient supply of clinical trial materials.
|
·
|
be delayed in obtaining marketing approval for our product candidates;
|
·
|
not obtain marketing approval at all;
|
·
|
obtain approval for indications or patient populations not as broad as intended or desired;
|
·
|
obtain approval with labeling that includes significant use or distribution restrictions or safety warnings;
|
·
|
be subject to additional post-marketing testing requirements; or
|
·
|
remove the product from the market after obtaining marketing approval.
|
·
|
regulatory authorities may withdraw prior approval of the product or impose restrictions on its distribution in the form of a modified risk evaluation and mitigation strategy;
|
·
|
we may be required to add labeling statements, such as warnings or contraindications;
|
·
|
we may be required to change the way the product is administered or conduct additional clinical trials;
|
·
|
we could be sued and held liable for harm caused to patients; and
|
·
|
our reputation may suffer.
|
·
|
issue a warning letter asserting we are in violation of the law;
|
·
|
seek an injunction or impose civil or criminal penalties or monetary fines;
|
·
|
suspend or withdraw regulatory approval;
|
·
|
suspend any ongoing clinical trials;
|
·
|
refuse to approve a pending NDA or supplements to an NDA submitted by us;
|
·
|
seize product; or
|
·
|
refuse to allow us to enter into supply contracts, including government contracts.
|
·
|
a partner may shift its priorities and resources away from our programs due to a change in business strategies, or a merger, acquisition, sale or downsizing of its company or business unit;
|
·
|
a partner may cease development in therapeutic areas which are the subject of our strategic alliances;
|
·
|
a partner may change the success criteria for a program or product candidate delaying or ceasing development of such program or candidate;
|
·
|
a significant delay in initiation of certain development activities by a partner could also delay payment of milestones tied to such activities, impacting our ability to fund our own activities;
|
·
|
a partner could develop a product that competes, either directly or indirectly, with an alliance product;
|
·
|
a partner with commercialization obligations may not commit sufficient financial or human resources to the marketing, distribution or sale of a product;
|
·
|
a partner with manufacturing responsibilities may encounter regulatory, resource or quality issues and be unable to meet demand requirements;
|
·
|
a partner may exercise its rights under the agreement to terminate a strategic alliance;
|
·
|
a dispute may arise between us and a partner concerning the research, development or commercialization of a program or product candidate resulting in a delay in milestones, royalty payments or termination of a program and possibly resulting in costly litigation or arbitration which may divert management attention and resources; and
|
·
|
a partner may use our proprietary information or intellectual property to invite litigation from a third party or fail to maintain or prosecute intellectual property rights possibly jeopardizing our rights in such property.
|
·
|
the inability to meet any product specifications and quality requirements consistently;
|
·
|
a delay or inability to procure or expand sufficient manufacturing capacity;
|
·
|
manufacturing and product quality issues related to scale-up of manufacturing;
|
·
|
costs and validation of new equipment and facilities required for scale-up;
|
·
|
a failure to comply with cGMP and similar foreign standards;
|
·
|
the inability to negotiate manufacturing agreements with third parties under commercially reasonable terms;
|
·
|
termination or nonrenewal of manufacturing agreements with third parties in a manner or that is costly or damaging to us;
|
·
|
the reliance on a few sources, and sometimes, single sources for raw materials, such that if we cannot secure a sufficient supply of these product components, we cannot manufacture and sell product candidates in a timely fashion, in sufficient quantities or under acceptable terms;
|
·
|
the lack of qualified backup suppliers for any raw materials currently purchased from a single source supplier;
|
·
|
operations of our third-party manufacturers or suppliers could be disrupted by conditions unrelated to our business or operations, including the bankruptcy of the manufacturer or supplier;
|
·
|
carrier disruptions or increased costs beyond our control; and
|
·
|
failing to deliver products under specified storage conditions and in a timely manner.
|
·
|
discover and develop therapeutics superior to other products in the market;
|
·
|
attract qualified scientific, product development and commercial personnel;
|
·
|
obtain patent and/or other proprietary protection for our technology platform and product candidates;
|
·
|
obtain required regulatory approvals; and
|
·
|
successfully collaborate with pharmaceutical companies in the discovery, development and commercialization of new therapeutics.
|
·
|
demonstration of clinical safety and efficacy compared to other products;
|
·
|
the relative convenience, ease of administration and acceptance by physicians, patients and healthcare payors;
|
·
|
the prevalence and severity of any AEs;
|
·
|
limitations or warnings in the label approved by FDA and/or foreign regulatory authorities for such products;
|
·
|
availability of alternative treatments;
|
·
|
pricing and cost-effectiveness;
|
·
|
the effectiveness of our or any collaborators’ sales and marketing strategies;
|
·
|
our ability to obtain hospital formulary approval; and
|
·
|
our ability to obtain and maintain sufficient third-party payor coverage or reimbursement.
|
·
|
different regulatory requirements for drug approvals in foreign countries;
|
·
|
reduced protection for intellectual property rights;
|
·
|
unexpected changes in tariffs, trade barriers and regulatory requirements;
|
·
|
economic weakness, including inflation, or political instability in foreign economies and markets;
|
·
|
compliance with tax, employment, immigration and labor laws for employees living or traveling abroad;
|
·
|
foreign taxes, including withholding of payroll taxes;
|
·
|
foreign currency fluctuations, which could cause increased operating expenses and reduced revenues, and other obligations incident to doing business in another country;
|
·
|
workforce uncertainty in countries where labor unrest is endemic;
|
·
|
production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and
|
·
|
business interruptions resulting from geopolitical actions, including war and terrorism, or natural disasters including earthquakes, typhoons, floods and fires.
|
·
|
the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, to induce, or in return for, either the referral of an individual, or the purchase or recommendation of an item or service for which payment may be made under a federal healthcare program, such as the Medicare and Medicaid programs;
|
·
|
federal civil and criminal false claims laws and civil monetary penalty laws, which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other third party payers that are false or fraudulent;
|
·
|
the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which created new federal criminal statutes that prohibit executing a scheme to defraud any healthcare benefit program and making false statements relating to healthcare matters;
|
·
|
HIPAA, as amended by the Health Information Technology and Clinical Health Act of 2009, or HITECH, and its implementing regulations, which imposes certain requirements relating to the privacy, security and transmission of individually identifiable health information; and
|
·
|
state and foreign law equivalents of each of the above federal laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any third party payer, including commercial insurers, and state and foreign laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts.
|
·
|
impairment of our business reputation;
|
·
|
withdrawal of clinical trial participants;
|
·
|
costs due to related litigation;
|
·
|
distraction of management’s attention from our primary business;
|
·
|
substantial monetary awards to patients or other claimants;
|
·
|
the inability to commercialize our product candidates; and
|
·
|
decreased demand for our product candidates, if approved for commercial sale.
|
(i)
|
we are current in our filings,
|
(ii)
|
certain manner of sale provisions, and
|
(iii)
|
filing of Form 144.
|
December 31, 2014
|
December 31, 2013
|
||||||||
Assets
|
|||||||||
Current assets:
|
|||||||||
Cash and cash equivalents
|
$ | 3,970 | $ | 1,034 | |||||
Accounts receivable
|
122 | - | |||||||
Marketable securities
|
1,975 | - | |||||||
Prepaid and other current assets
|
144 | 139 | |||||||
Mortgage note receivable, current portion
|
165 | - | |||||||
Total current assets
|
6,376 | 1,173 | |||||||
Property and equipment, net
|
284 | 469 | |||||||
Deposits
|
31 | 19 | |||||||
Mortgage note receivable, long-term portion
|
2,431 | - | |||||||
In process research and development
|
184,966 | - | |||||||
Goodwill
|
65,195 | - | |||||||
Total assets
|
$ | 259,283 | $ | 1,661 | |||||
Liabilities and stockholders' equity (deficit)
|
|||||||||
Current liabilities:
|
|||||||||
Accounts payable
|
299 | 224 | |||||||
Accrued expenses
|
394 | 139 | |||||||
Derivative liabilities
|
8,464 | 23 | |||||||
Total current liabilities
|
9,157 | 386 | |||||||
Long-term liabilities
|
|||||||||
Deferred rent
|
62 | - | |||||||
Deferred tax liability
|
65,195 | - | |||||||
Total long-term liabilities
|
65,257 | - | |||||||
Total liabilities
|
74,414 | 386 | |||||||
Commitments and contingencies
|
|||||||||
Cocrystal Discovery, Inc. Series A convertible preferred stock, $0.001 par value; 7,150 shares authorized; 0 and 7,046 shares
issued and outstanding at
December 31, 2014 and December 31, 2013, respectively; liquidation preference of $14,000
as of December 31, 2013,
owned by Cocrystal Discovery shareholders, converted in the merger with Biozone.
|
- | 10,108 | |||||||
Series A convertible preferred stock, $0.001 par value; 1,000 shares authorized,
issued and outstanding at December 31, 2014, issued in the merger with RFS Pharma, LLC
|
178,218 | - | |||||||
Stockholders' equity (deficit):
|
|||||||||
Series B convertible preferred stock, $.001 par value; 5,000 shares authorized; 1,000 and 279 shares issued and outstanding at December 31, 2014 and December 31, 2013, respectively
|
1 | - | |||||||
Common stock, $.001 par value; 200,000 and 262,186 shares authorized, 122,494 and 0 shares issued and outstanding as of December 31, 2014 and December 31, 2013, respectively
|
123 | - | |||||||
Additional paid-in capital
|
18,725 | 3,502 | |||||||
Accumulated other comprehensive income, net of tax
|
236 | - | |||||||
Accumulated deficit
|
(12,434 | ) | (12,335 | ) | |||||
Total stockholders' equity (deficit)
|
6,651 | (8,833 | ) | ||||||
Total liabilities and stockholders' equity (deficit)
|
$ | 259,283 | $ | 1,661 |
2014
|
2013
|
||||||||
Grant revenues
|
$ | 9 | $ | - | |||||
Operating expenses
|
|||||||||
Research and development
|
4,071 | 3,862 | |||||||
General and administrative
|
1,737 | 219 | |||||||
Total operating expenses
|
5,808 | 4,081 | |||||||
Loss from operations
|
(5,799 | ) | (4,081 | ) | |||||
Interest income
|
96 | 2 | |||||||
Realized gain on sale of marketable securities
|
1,359 | - | |||||||
Other expense
|
(7 | ) | - | ||||||
Fair value of warrant liabilities in excess of proceeds from financing
|
(946 | ) | - | ||||||
Loss on return of escrowed shares
|
(584 | ) | - | ||||||
Change in fair value of derivative liabilities
|
5,730 | 192 | |||||||
Total other income, net
|
5,648 | 194 | |||||||
Loss before income taxes
|
(151 | ) | (3,887 | ) | |||||
Income tax benefit
|
52 | - | |||||||
Net loss
|
$ | (99 | ) | $ | (3,887 | ) | |||
Comprehensive income (loss):
|
|||||||||
Net loss
|
$ | (99 | ) | $ | (3,887 | ) | |||
Unrealized gain on marketable securities, net of tax
|
236 | - | |||||||
Total comprehensive income (loss)
|
$ | 137 | $ | (3,887 | ) | ||||
Net loss per common share:
|
|||||||||
Net loss per share, basic
|
$ | (0.00 | ) | $ | (0.07 | ) | |||
Net loss per share, diluted | (0.01 | ) | (0.07 | ) | |||||
Weighted average common shares outstanding, basic | 326,779 | 57,255 | |||||||
Weighted average common shares outstanding, diluted
|
327,753 | 57,255 |
Cocrystal Discovery, Inc. Series A Convertible Preferred Stock
|
Series A Convertible Preferred Stock
|
Series B Convertible Preferred Stock
|
Common Stock
|
Additional Paid-in capital
|
Accumulated other comprehensive income
|
Accumulated Deficit
|
Total Stockholders' Equity (Deficit)
|
|||||||||||||||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2012
|
7,046 | $ | 10,108 | - | $ | - | 279 | $ | - | - | $ | - | $ | 3,440 | $ | (8,448 | ) | $ | (5,008 | ) | ||||||||||||||||||||||||||||
Issuance of common stock
|
- | |||||||||||||||||||||||||||||||||||||||||||||||
Issuance of series A preferred stock
|
- | |||||||||||||||||||||||||||||||||||||||||||||||
Stock based compensation
|
55 | 55 | ||||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options
|
7 | 7 | ||||||||||||||||||||||||||||||||||||||||||||||
Net loss
|
(3,887 | ) | (3,887 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2013
|
7,046 | 10,108 | - | - | 279 | - | - | - | 3,502 | (12,335 | ) | (8,833 | ) | |||||||||||||||||||||||||||||||||||
Conversion of series A convertible stock
|
(7,046 | ) | (10,108 | ) | 721 | 1 | 10,107 | 10,108 | ||||||||||||||||||||||||||||||||||||||||
Merger between Biozone Pharmaceuticals, Inc. and Cocrystal Discovery, Inc.
|
115,907 | 116 | (1,596 | ) | (1,480 | ) | ||||||||||||||||||||||||||||||||||||||||||
Exercise of common stock options
|
1,087 | 1 | 115 | 116 | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation
|
38 | 38 | ||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock and warrants in January 2014
|
5,500 | 6 | (6 | ) | - | |||||||||||||||||||||||||||||||||||||||||||
Unrealized gain on marketable securities, net of tax
|
236 | 236 | ||||||||||||||||||||||||||||||||||||||||||||||
Series A preferred stock issued in the merger with RFS Pharma, LLC
|
1,000 | 178,218 | - | |||||||||||||||||||||||||||||||||||||||||||||
Stock options issued in the merger with RFS Pharma, LLC
|
6,565 | 6,565 | ||||||||||||||||||||||||||||||||||||||||||||||
Net loss
|
(99 | ) | (99 | ) | ||||||||||||||||||||||||||||||||||||||||||||
- | $ | - | 1,000 | $ | 178,218 | 1,000 | $ | 1 | 122,494 | $ | 123 | $ | 18,725 | $ | 236 | $ | (12,434 | ) | $ | 6,651 |
•
|
Significant changes in the manner of its use of acquired assets or the strategy for its overall business;
|
•
|
Significant negative industry or economic trends;
|
•
|
Significant decline in stock price for a sustained period; and
|
•
|
Significant decline in market capitalization relative to net book value.
|
· | Estimated dividends: | None |
· | Expected volatility: | 79 - 103% |
· | Risk-free interest rate: | 0.25 - 2.11% |
· | Expected term: | 1.16 – 9.05 years |
Purchased in-process research and development
|
$ | 184,966 | ||
Net book value of tangible assets acquired
|
(183 | ) | ||
Goodwill
|
65,195 | |||
Deferred tax liability
|
(65,195 | ) | ||
Total purchase price
|
$ | 184,783 |
December 31,
|
||||||||
201
4
|
2013
|
|||||||
Lab equipment
|
$ | 1,146 | $ | 1,113 | ||||
Computer and office equipment
|
87 | 92 | ||||||
Total equipment
|
$ | 1,233 | 1,205 | |||||
Less accumulated depreciation
|
(949 | ) | (736 | ) | ||||
Property and equipment, net
|
$ | 284 | $ | 469 |
Number of shares available for grant
|
Total options outstanding
|
Weighted Average Exercise Price
|
||||||||||
Balance at December 31, 2012
|
1,773,390 | 4,326,461 | $ | 0.11 | ||||||||
Granted
|
(229,318 | ) | 229,318 | 0.16 | ||||||||
Exercised
|
(49,319 | ) | 0.10 | |||||||||
Cancelled
|
103,560 | (103,560 | ) | 0.10 | ||||||||
Balance at December 31, 2013
|
1,647,632 | 4,402,900 | 0.12 | |||||||||
Increase in option pool
|
47,459,195 | |||||||||||
Options granted to merger employees
|
(16,542,538 | ) | 16,542,538 | 0.10 | ||||||||
Exercised
|
(1,087,081 | ) | 0.11 | |||||||||
Cancelled
|
258,245 | (258,245 | ) | 0.11 | ||||||||
Balance at December 31, 2014
|
32,822,534 | 19,600,112 | $ | 0.10 |
Year Ended December 31,
|
||||||||
201
4
|
2013
|
|||||||
Assumptions:
|
||||||||
Risk-free interest rate
|
1.08 – 2.51 | % | 1.11 | % | ||||
Expected dividend yield
|
0 | % | 0 | % | ||||
Expected volatility
|
108 | % | 108 | % | ||||
Expected term (in years)
|
6.08 | 6.08 |
December 31, | December 31, | |||||||
2014
|
2013
|
|||||||
Conversion of preferred stock
|
- | 148,494,693 | ||||||
Stock options issued and outstanding
|
19,600,112 | 4,402,900 | ||||||
Authorized for future option grants
|
32,822,534 | 1,647,632 | ||||||
Warrants outstanding
|
26,669,000 | |||||||
Total
|
79,091,646 | 154,545,225 |
Warrants accounted for as:
Equity
|
Warrants accounted for as:
Liabilities
|
|||||||||||||||||||||||||||||||||||
January 2012
warrants
|
March 2013
warrants
|
April 2013
warrants
|
February 2012
warrants
|
August 2013
warrants
|
October 2013
warrants
|
October 2013
Series A warrants
|
January 2014
warrants
|
Total
|
||||||||||||||||||||||||||||
Outstanding, January 1, 2014
|
- | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
Warrants acquired in merger with Biozone
|
650 | 455 | 1,864 | 1,000 | 10,000 | 200 | 7,000 | - | 21,169 | |||||||||||||||||||||||||||
Warrants issued
|
- | - | - | - | - | - | - | 5,500 | 5,500 | |||||||||||||||||||||||||||
Outstanding, December 31, 2014
|
650 | 455 | 1,864 | 1,000 | 10,000 | 200 | 7,000 | 5,500 | 26,669 | |||||||||||||||||||||||||||
Expiration date
|
January 11, 2016
|
March 1, 2016
|
April 25, 2018
|
February 28, 2016
|
August 26, 2023
|
October 18, 2018
|
October 24, 2023
|
January 16, 2024
|
February 2012 warrants
|
August 2013 warrants
|
October 2013 warrants
|
October 2013 warrants
|
January 2014 warrants
|
||||||||||||||||
Strike price
|
$ | 0.60 | $ | 0.40 | $ | 0.50 | $ | 0.50 | $ | 0.50 | ||||||||||
Expected term (years)
|
1.2 | 8.7 | 3.8 | 8.8 | 9.1 | |||||||||||||||
Cumulative volatility %
|
79 | % | 103 | % | 81 | % | 103 | % | 103 | % | ||||||||||
Risk-free rate %
|
0.25 | % | 2.08 | % | 1.32 | % | 2.09 | % | 2.11 | % |
Description
|
December 31, 2014
|
Quoted Prices in Active Markets
(Level 1)
|
Significant Other Observable Inputs
(Level 2)
|
Unobservable Inputs
(Level 3)
|
||||||||||||
Assets:
|
||||||||||||||||
Cash and cash equivalents
|
$ | 3,970 | $ | 3,970 | $ | - | $ | - | ||||||||
Marketable securities
|
1,975 | - | 1,975 | - | ||||||||||||
Total assets
|
$ | 5,945 | $ | 3,970 | $ | 1,975 | $ | - | ||||||||
Liabilities:
|
||||||||||||||||
Warrants potentially settleable in cash
|
$ | 8,464 | $ | - | $ | - | $ | 8,464 | ||||||||
Total liabilities
|
$ | 8,464 | $ | - | $ | - | $ | 8,464 | ||||||||
Description
|
December 31, 2013
|
Quoted Prices in Active Markets
(Level 1)
|
Significant Other Observable Inputs
(Level 2)
|
Unobservable Inputs
(Level 3)
|
||||||||||||
Assets:
|
||||||||||||||||
Cash and cash equivalents
|
$ | 1,034 | $ | 1,034 | $ | - | $ | - | ||||||||
Total assets
|
$ | 1,034 | $ | 1,034 | $ | - | $ | - | ||||||||
Liabilities:
|
||||||||||||||||
Derivative liability
|
$ | 23 | $ | - | $ | - | $ | 23 | ||||||||
Total liabilities
|
$ | 23 | $ | - | $ | - | $ | 23 |
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||
2014
|
2013
|
|||||||
Balance , January 1,
|
$ | 23 | $ | 215 | ||||
Change in fair value of Teva option
|
(23 | ) | (192 | ) | ||||
Estimated fair value of warrants assumed in merger on January 2, 2014
|
10,475 | - | ||||||
Estimated fair value of warrants issued in January common stock sale
|
3,696 | - | ||||||
Change in fair value of warrants for the year ended December 31, 2014
|
(5,707 | ) | - | |||||
Balance at December 31,
|
$ | 8,464 | $ | 23 |
For the year ended December 31,
|
||||||||
2014
|
2013
|
|||||||
Options to purchase common stock
|
19,600 | 4,403 | ||||||
Warrants to purchase common stock
|
16,669 | 21,169 | ||||||
Cocrystal Discovery, Inc. Series A convertible preferred stock
|
9,670 | |||||||
Total
|
36,269 | 35,242 |
Year Ended December 31,
|
|||||||||
2014
|
2013
|
||||||||
Federal
|
$ | - | $ | - | |||||
State
|
2 | - | |||||||
Total current income tax expense
|
2 | - | |||||||
Deferred:
|
|||||||||
Federal
|
(51 | ) | - | ||||||
State
|
(3 | ) | - | ||||||
Total deferred income tax expense (benefit)
|
(54 | ) | - | ||||||
Total income tax expense (benefit)
|
$ | (52 | ) | $ | - |
2014
|
2013
|
|||||||
Deferred Tax Assets:
|
||||||||
Net operating loss carryforwards
|
$ | 7,276 | $ | 5,802 | ||||
Compensation
|
14 | 56 | ||||||
Research and development tax credits
|
835 | 840 | ||||||
Other
|
65 | 1 | ||||||
Total gross deferred tax assets
|
8,190 | 6,699 | ||||||
Deferred Tax Liabilities
|
||||||||
Unrealized gain on marketable securities
|
(185 | ) | - | |||||
Property and equipment
|
(18 | ) | (15 | ) | ||||
Acquired in-process research and development
|
(65,195 | ) | - | |||||
Total Deferred Tax Liabilities
|
(65,398 | ) | (15 | ) | ||||
Net deferred tax assets
|
(57,208 | ) | 6,684 | |||||
Valuation allowance
|
(7,987 | ) | (6,684 | ) | ||||
Net Deferred Tax Liability
|
$ | (65,195 | ) | $ | - |
Year Ended December 31,
|
||||||||
2014
|
2013
|
|||||||
Statutory federal income tax rate
|
34.0 | % | 34.0 | % | ||||
Change in fair value of warrant liability
|
10.7 | 2.0 | ||||||
State income taxes, net of federal benefit
|
0.4 | 3.0 | ||||||
Tax credits
|
0.9 | 3.0 | ||||||
Change in valuation allowance
|
(11.2 | ) | (42.0 | ) | ||||
Permanent differences
|
(0.7 | ) | - | |||||
Other
|
(0.1 | ) | - | |||||
Effective rate
|
34.0 | % | 0.0 | % |
Year ending December 31
|
||||
2015
|
$ | 369 | ||
2016
|
358 | |||
2017
|
159 | |||
2018
|
168 | |||
2019
|
14 | |||
Total minimum Lease Payments
|
$ | 1,068 |
Exhibit
|
Incorporated by Reference
|
Filed or
Furnished
|
|||||||
No.
|
Exhibit Description
|
Form
|
Date
|
Number
|
Herewith
|
||||
2.1
|
Agreement and Plan of Merger – Cocrystal Discovery
|
8-K
|
1/8/14
|
2.1
|
|||||
2.2
|
Agreement and Plan of Merger – RFS Pharma
|
8-K
|
12/1/14
|
2.1
|
|||||
2.3
|
Asset Purchase Agreement – MusclePharm Corporation
|
8-K
|
11/13/13
|
2.1
|
|||||
3.1
|
Certificate of Incorporation, as amended
|
Filed
|
|||||||
3.2
|
Bylaws
|
8-K
|
12/1/14
|
3.4
|
|||||
4.1
|
Stockholders Rights Agreement, dated as of November 25, 2014
|
8-K
|
12/1/14
|
4.1
|
|||||
10.1
|
Form of Securities Purchase Agreement - January 2014 Offering
|
8-K
|
1/21/14
|
10.1
|
|||||
10.2
|
Form of Warrant - January 2014 Offering
|
8-K
|
1/21/14
|
10.2
|
|||||
10.3
|
Employment Agreement – Gary Wilcox*
|
8-K
|
1/8/14
|
10.1
|
|||||
10.4
|
Employment Agreement – Sam Lee*
|
8-K
|
1/8/14
|
10.2
|
|||||
10.5
|
Termination of Employment Agreement – Gary Wilcox*
|
Filed
|
|||||||
10.6
|
Amendment of Employment Agreement – Sam Lee*
|
Filed
|
|||||||
10.7
|
Employment Agreement, as amended – Jeffrey Meckler*
|
8-K
|
3/17/15
|
10.1
|
|||||
10.8
|
2007 Equity Incentive Plan - Cocrystal Discovery
|
S-8
|
1/2/14
|
10.1
|
|||||
10.9
|
Form of Securities Purchase Agreement – October 2013 Offering
|
8-K
|
10/31/13
|
10.1
|
|||||
10.10
|
Form of Warrant – October 2013 Offering
|
8-K
|
10/31/13
|
10.2
|
|||||
10.11
|
Form of Securities Purchase Agreement –2013 Note Offering
|
8-K
|
8/30/13
|
10.1
|
|||||
10.12
|
Form of Note – 2013 Note Offering
|
8-K
|
8/30/13
|
10.2
|
|||||
10.13
|
Form of Warrant – 2013 Note Offering
|
8-K
|
8/30/13
|
10.3
|
|||||
10.14
|
Form of Subscription Agreement – 2013 Unit Offering
|
8-K
|
4/18/13
|
10.1
|
|||||
10.15
|
Form of Warrant – 2013 Unit Offering
|
8-K
|
4/18/13
|
10.2
|
|||||
10.16
|
Form of Indemnification Agreement
|
10-K/A
|
4/4/14
|
3.9
|
|||||
10.17
|
Share Purchase Agreement+
|
10-Q/A
|
8/14/14
|
10.20
|
|||||
10.18
|
Research and Collaboration Agreement Between Teva Pharmaceutical Industries Limited and Cocrystal Discovery, Inc.+
|
10-Q/A
|
8/14/14
|
10.21
|
|||||
10.19
|
Exclusive License Agreement Between Teva Pharmaceutical Industries Limited and Cocrystal Discovery, Inc.+
|
10-Q/A
|
8/14/14
|
10.22
|
|||||
10.20
|
Memorandum of Understanding regarding MusclePharm Corporation
|
10-Q
|
11/14/14
|
10.1
|
|||||
21.1
|
Subsidiaries
|
Filed
|
|||||||
23.1
|
Principal Accountant Consent
|
Filed
|
|||||||
31.1
|
Certification of Principal Executive Officer (302)
|
Filed
|
|||||||
31.2
|
Certification of Principal Financial Officer (302)
|
Filed
|
|||||||
32.1
|
Certification of Principal Executive and Principal Financial Officer (906)
|
Furnished**
|
|||||||
101.INS
|
XBRL Instance Document
|
Filed
|
|||||||
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
Filed
|
|||||||
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
Filed
|
|||||||
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
Filed
|
|||||||
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
Filed
|
|||||||
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
Filed
|
COCRYSTAL PHARMA, INC.
|
||
March 31, 2015
|
By:
|
/s/ Gary Wilcox
|
Gary Wilcox
Chief Executive Officer
(Principal Executive Officer)
|
||
SIGNATURE
|
TITLE
|
DATE
|
||
/s/ Gary Wilcox
Gary Wilcox
|
Chief Executive Officer (Principal Executive Officer)
|
March 31, 2015
|
||
/s/ Raymond F. Schinazi
Raymond F. Schinazi
|
Chairman
|
March 31, 2015
|
||
David Block
|
Director
|
March 31, 2015
|
||
/s/ Phillip Frost
|
Director
|
March 31, 2015
|
||
Phillip Frost
|
||||
/s/ Jane Hsiao
|
Director
|
March 31, 2015
|
||
Jane Hsiao
|
||||
/s/ Jeffrey Meckler
|
Director
|
March 31, 2015
|
||
Jeffrey Meckler
|
||||
/s/ Steven Rubin
|
Director
|
March 31, 2015
|
||
Steven Rubin | ||||
/s/ Gerald McGuire
|
Chief Financial Officer (Principal Financial and Accounting Officer)
|
March 31, 2015
|
||
Gerald McGuire
|
Name
|
Mailing Address
|
Dr. Gary Wilcox
|
4018 Via Laguna
Santa Barbara, CA 93110
|
|
*********************
|
|
RESOLVED, FURTHER, that the Chief Executive Officer, the president or any vice-president, and the secretary or any assistant secretary, of the Corporation be and they hereby are authorized and directed to prepare and file this Certificate of Designation of Preferences, Rights and Limitations in accordance with the foregoing resolution and the provisions of Delaware law.
|
/s/ Gary Wilcox
Name: Gary Wilcox
Title: Chief Executive Officer
|
Executive
|
Dr. Sam Lee
|
Jerry McGuire
|
Dr. Gary Wilcox
|
(a) Date to Effect Redemption: ____________________________________________________
|
|
(b) Number of shares of Preferred Stock owned prior to Redemption: ______________________
|
|
(c) Number of shares of Preferred Stock to be Redeemed: _______________________________
|
|
(d) Number of shares of Common Stock Issuable per share of Preferred Stock:______________
(e) Total Number of shares of Common Stock issuable upon Conversion of Preferred Shares being Redeemed [(c) x (d)]:____________________________________________________________
|
|
(f) Conversion Price per share of Common Stock:_
$
____________________________________
|
|
(g) Redemption Payment Due [(e) x (f)]:_
$
___________________________________________
(g) Number of shares of Preferred Stock subsequent to Redemption [(b)-(c)]: ________________
|
|
(h) Address for Delivery of Payment or Wire Instructions:
_____________________________________
_____________________________________
_____________________________________
|
|
[HOLDER]
By:___________________________________
Name:
Title:
|
|
1.
|
The name of the Corporation shall be changed to Cocrystal Pharma, Inc.
|
|
3.
|
Section 4(a) shall be replaced by the following:
|
|
4.
|
Section 4(c) shall be replaced by the following:
|
COCRYSTAL PHARMA, INC.
|
||
|
||
By:
|
/s/ Gary Wilcox | |
GARY WILCOX
CHIEF EXECUTIVE OFFICER
|
Name of Subsidiary
|
Jurisdiction of Incorporation
|
||
Cocrystal Merger Sub, Inc.
|
Delaware
|
||
RFS Pharma, LLC
|
Georgia
|
||
Cocrystal Discovery, Inc.
|
Delaware
|
||
/s/ Gary Wilcox
|
Gary Wilcox
Chief Executive Officer
(Principal Executive Officer)
|
/s/ Gerald McGuire
|
Gerald McGuire
Chief Financial Officer
(Principal Financial Officer)
|
1.
|
The annual report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and
|
2.
|
The information contained in the annual report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Gary Wilcox
|
Gary Wilcox
Chief Executive Officer
(Principal Executive Officer)
|
1.
|
The annual report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and
|
2.
|
The information contained in the annual report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Gerald McGuire
|
Gerald McGuire
Chief Financial Officer
(Principal Financial Officer)
|