x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 20-0028718 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
6120 Windward Parkway, Suite 290 Alpharetta, GA | 30005 | |
(Address of principal executive offices) | (Zip Code) |
Common Stock, $0.01 par value per share | The NASDAQ Stock Market LLC | |
(Title of each class) | (Name of each exchange on which registered) |
Large accelerated filer | o | Accelerated filer | o | |
Non-accelerated filer | o | (Do not check if a smaller reporting company) | Smaller reporting company | x |
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• | uncertainty as to our ability to achieve profitability and positive cash flow through the commercialization of ILUVIEN® in the European Economic Area (EEA), the United States (U.S.) and other regions of the world where we sell ILUVIEN; |
• | our ability to operate our business in compliance with the covenants and restrictions that we are subject to under our credit facility; |
• | dependence on third-party manufacturers to manufacture ILUVIEN or any future products or product candidates in sufficient quantities and quality; |
• | uncertainty as to the pricing and reimbursement guidelines for ILUVIEN or any future products or product candidates, including ILUVIEN in new markets; |
• | our ability to successfully commercialize ILUVIEN following regulatory approval in additional markets; |
• | delay in or failure to obtain regulatory approval of ILUVIEN in additional countries or any future products or product candidates; |
• | the extent of government regulations; and |
• | our need to raise additional financing. |
• | Maximize the Commercial Success of ILUVIEN. We launched ILUVIEN in Germany and the United Kingdom in the second quarter of 2013 and in the U.S. and Portugal in the first quarter of 2015. We have approval in 14 additional countries in the EEA and we are pursuing opportunities to sell ILUVIEN in some of these countries, including Austria and Ireland. In Italy, our distributor plans to launch ILUVIEN in 2017. In addition, outside the EEA, our distributor launched in the Middle East and began selling ILUVIEN in the United Arab Emirates in the second half of 2016. |
• | Pursue Approval in Additional Countries. We plan to pursue regulatory approval for ILUVIEN, directly or with a partner, in other countries. In addition to the distribution agreements for the Middle East and Italy, we entered into agreements to distribute ILUVIEN in Australia, New Zealand and Canada. Pursuant to these agreements, our distributors will assist us in obtaining approval or seek approval with our oversight in those countries. In addition, |
• | Assess the Effectiveness of ILUVIEN for Additional Retinal Diseases. We believe that ILUVIEN has the potential to address additional retinal diseases including, among others, Non-Proliferative Diabetic Retinopathy (NPDR), retinal vein occlusion (RVO), dry aged-related macular degeneration (AMD) and wet AMD. |
• | Expand Our Ophthalmic Product Pipeline. We believe there are further unmet medical needs in the treatment of ophthalmic diseases. Toward that end, we intend to evaluate in-licensing and acquisition opportunities for compounds and technologies with potential treatment applications for diseases affecting the eye. |
• | ILUVIEN delivers FAc. The active pharmaceutical ingredient in ILUVIEN is FAc, which has demonstrated efficacy in the treatment of DME in clinician’s real world experience and in the two completed Phase 3 pivotal clinical trials, collectively referred to as our FAME Study, over multiple years. |
• | ILUVIEN delivers a continuous daily microdose of steroid to the eye. The delivery mechanism of ILUVIEN provides lower daily and aggregate exposure to corticosteroids than other intraocular dosage forms currently available. ILUVIEN has shown to provide sustained sub-microgram levels of FAc through in vitro release kinetics and in vivo over time. The results of our FAME Study demonstrated that ILUVIEN provides a sustained, therapeutic effect in the treatment of DME patients for up to 36 months. |
• | Macular edema associated with RVO. According to GlobalData, a provider of global business intelligence, there are 16 million adults affected with RVO around the world. In September 2009, Allergan, Inc. (Allergan) introduced Ozurdex (a short duration corticosteroid) as the first approved product for macular edema following branch or RVO. The U.S. Food and Drug Administration’s (FDA) approval of Ozurdex provides additional evidence that corticosteroids work effectively to treat RVO. |
• | Moderately severe to severe NPDR progression to proliferative diabetic retinopathy (PDR). NPDR is the most at-risk stage of diabetic retinopathy for risk of progression to PDR. Prevention of progression to PDR is clinically important as the risk of severe vision loss, blindness and retinal detachment increase when diabetic retinopathy progresses from NPDR to PDR. |
• | Dry AMD. Dry AMD patients account for 90% of AMD patients, with the greatest unmet need among these patients being a treatment for geographic atrophy (GA) for which there are currently no treatments available. Pre-clinical studies in two established rat models of retinal degeneration reported at the Association for Research in Vision and Ophthalmology meetings in 2006, 2007 and 2008, described the efficacious effects of a miniaturized version of ILUVIEN in retinal degeneration. While there are no standard preclinical models of GA, we believe these results support the exploration of ILUVIEN to treat this condition. |
• | Wet AMD. The size of the wet AMD market was $2 billion in 2008 according to VisionGain, an independent competitive intelligence organization. According to American Academy of Ophthalmology, more than 11 million people in America are affected by AMD and are now benefiting from advanced treatment options such as anti-VEGF agents and photodynamic therapy (PDT). Anti-VEGF antibodies require persistent dosing to maintain a therapeutic effect which is a burden on both the patient and the physician. Estimates as of March 2015 of the global cost of visual impairment due to AMD is $343 billion, including $255 billion in direct health care costs according to BrightFocus Foundation. We believe ILUVIEN has the potential to be synergistic with the market leading anti-VEGF antibody therapies in the treatment of wet AMD given that corticosteroids have been shown to suppress the production of VEGF. |
• | Roche’s products Lucentis (ranibizumab injection) and Avastin (bevacizumab) are both antibodies that inhibit VEGF signaling pathways. Lucentis is marketed in the EEA by Novartis. Lucentis is currently approved for the treatment of DME, the treatment of diabetic retinopathy in patients with DME, the treatment of neovascular wet AMD and the treatment of macular edema following RVO in the U.S. In the EEA, the indications are similar except for the indication to treat diabetic retinopathy in patients with DME. Avastin, an oncology product, is used by retinal specialists in both the U.S. and in certain countries of the EEA in the treatment of numerous retinal diseases off label but is not formulated or approved for any ophthalmic use. |
• | Regeneron’s Eylea (aflibercept), an anti-VEGF inhibitor, is approved for the treatment of DME, the treatment of diabetic retinopathy in patients with DME, neovascular wet AMD and RVO in the U.S. As with Lucentis, in the EEA, the indication does not include diabetic retinopathy. Eylea is marketed in the EEA by Bayer. |
• | Allergan’s product Ozurdex (dexamethasone intravitreal implant), is a short duration biodegradable implant that delivers the corticosteroid dexamethasone. Ozurdex is approved for the treatment of DME, macular edema following branch or central RVO and non-infectious uveitis affecting the posterior segment of the eye in the U.S. In the EEA, the indication for DME is for visual impairment due to diabetic macular oedema who are pseudophakic or who are considered insufficiently responsive to, or unsuitable for non-corticosteroid therapy. |
• | cost of treatment; |
• | pricing and availability of alternative products; |
• | our ability to obtain third-party coverage or reimbursement for ILUVIEN at appropriate levels; |
• | perceived prevalence and severity of adverse side effects associated with treatment; |
• | perceived efficacy relative to other available therapies; |
• | relative convenience and ease of administration; and |
• | shifts in the medical community to new treatment paradigms or standards of care. |
• | the level of success of the commercialization of ILUVIEN in the U.S., Germany, Portugal, the United Kingdom and any other territories we may launch in, |
• | expenses relating to the commercialization of ILUVIEN; |
• | the level of success of the commercialization of ILUVIEN by our distributors in Italy and the Middle East; |
• | the timing of approvals, if any, of ILUVIEN in additional jurisdictions; |
• | the extent to which we enter into, maintain, and derive revenues from licensing agreements, including agreements to out-license ILUVIEN, research and other collaborations, joint ventures and other business arrangements; |
• | the amount of our research, development and medical affairs, marketing and general and administrative expenses; |
• | the need and cost of conducting additional clinical trials for ILUVIEN; |
• | the extent to which we acquire, and our success in integrating, technologies or companies; |
• | regulatory changes and technological developments in our markets; and |
• | the extent to which we can manage the use of cash in our business operations. |
• | extended collection timelines for accounts receivable and greater working capital requirements; |
• | multiple legal systems and unexpected changes in legal requirements; |
• | tariffs, export restrictions, trade barriers and other regulatory or contractual limitations on our ability to sell or develop our products in certain foreign markets; |
• | trade laws and business practices favoring local competition; |
• | potential tax issues, including restrictions on repatriating earnings, multiple and conflicting and complex tax laws and regulations; |
• | weaker intellectual property protection in some countries; |
• | political instability, including war and terrorism or the threat of war and terrorism; and |
• | adverse economic conditions, including the stability and solvency of business financial markets, financial institutions and sovereign nations. |
• | our inability to recruit and retain adequate numbers of effective personnel; |
• | the inability of sales personnel to obtain access to or persuade adequate numbers of ophthalmologists to prescribe our products; |
• | the lack of complementary products or additional labeled indications for ILUVIEN to be offered by sales personnel, which may put us at a competitive disadvantage relative to companies with more extensive product lines; |
• | the inability of market access personnel to obtain sufficient levels of pricing and reimbursement in each jurisdiction; and |
• | unforeseen costs and expenses associated with creating a commercial organization. |
• | regulatory agencies may interpret data from preclinical and clinical testing in different ways from those which we do; |
• | they may not approve of our manufacturing processes; |
• | a drug candidate may not be safe or effective; |
• | they may conclude that the drug candidate does not meet quality standards for stability, quality, purity and potency; and |
• | they may change their approval policies or adopt new regulations. |
• | the commercial success of ILUVIEN; |
• | timing and ordering patterns from our distributors; |
• | our ability to obtain regulatory approval of ILUVIEN in additional jurisdictions; |
• | sales, marketing and medical affairs expenses; |
• | manufacturing or supply issues; |
• | seasonality caused by insurance renewals for patients in the U.S., and by doctor and or patient absences due to holidays and vacations; |
• | regulatory developments affecting ILUVIEN, our future product candidates or our competitors’ products; |
• | the emergence of products that compete with ILUVIEN; |
• | cost of product sales; |
• | variations in the level of expenses related to our products or future development programs; |
• | the timing and amount of royalties, milestone payments, or product purchases by our distributors; |
• | the status of our preclinical and clinical development programs; |
• | our execution of collaborative, licensing or other arrangements, and the timing of payments we may make or receive under these arrangements; |
• | any intellectual property infringement or other lawsuit in which we may become involved; and |
• | the timing and recognition of stock-based compensation expense. |
• | are more effective; |
• | receive better reimbursement terms; |
• | are more accepted by physicians; |
• | have fewer or less severe adverse side effects; |
• | are better tolerated; |
• | are more adaptable to various modes of dosing; |
• | have better distribution channels; |
• | are easier to administer; or |
• | are less expensive, including but not limited to a generic version of ILUVIEN. |
• | our collaboration agreements are expected to be for fixed terms and subject to termination under various circumstances, including, in many cases, on short notice without cause; |
• | our collaborators may not promote and market our drugs in the manner we would or as well as we would if we had the resources to do so in their countries; |
• | our collaborators may change the focus of their development and commercialization efforts. In recent years there have been a significant number of mergers and consolidations in the pharmaceutical and biotechnology industries, some of which have resulted in the participant companies reevaluating and shifting the focus of their business following the completion of these transactions. The ability of our products to reach their potential could be limited if any of our future collaborators decreases or fails to increase spending relating to such products |
• | our collaboration agreements will likely require us to not conduct specified types of research and development in the field that is the subject of the collaboration. These agreements may have the effect of limiting the areas of research and development that we may pursue, either alone or in cooperation with third-parties; |
• | our collaborators may develop and commercialize, either alone or with others, products and services that are similar to or competitive with our products which are the subject of their collaboration with us. |
• | the research methodology used may not be successful in identifying potential products or product candidates; or |
• | potential products or product candidates may on further study be shown to have harmful side effects or other characteristics that indicate they are unlikely to be effective drugs. |
• | we may be unable to license or acquire the relevant technology on terms that would allow us to make an appropriate return from the product; |
• | companies that perceive us to be their competitors may be unwilling to assign or license their product rights to us; or |
• | we may be unable to identify suitable products or product candidates within our areas of expertise. |
• | our inability to manufacture or obtain from third-parties materials sufficient for use in preclinical studies and clinical trials; |
• | delays in patient enrollment and variability in the number and types of patients available for clinical trials; |
• | difficulty in maintaining contact with patients after treatment, resulting in incomplete data; |
• | poor effectiveness of product candidates during clinical trials; |
• | unforeseen safety issues or side effects; and |
• | governmental or regulatory delays and changes in regulatory requirements and guidelines. |
• | failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols; |
• | inspection of the clinical trial operations or trial sites by the FDA or other regulatory authorities resulting in the imposition of a clinical hold; |
• | unforeseen safety issues or any determination that a trial presents unacceptable health risks; and |
• | lack of adequate funding to continue the clinical trial, including the incurrence of 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, and other third parties. |
• | our ability to successfully commercialize ILUVIEN in the U.S., Germany, Portugal and the United Kingdom; |
• | the ability of ILUVIEN to be approved in any additional jurisdiction; |
• | the ability of ILUVIEN or any future products or product candidates, if approved in additional jurisdictions, to achieve and maintain commercial success; |
• | FDA or international regulatory actions, including failure to receive or maintain regulatory approval for ILUVIEN or any future products or product candidates; |
• | quarterly variations in our results of operations or those of our competitors; |
• | announcements by us or our competitors of acquisitions, regulatory approvals, clinical milestones, new products, significant contracts, commercial relationships or capital commitments; |
• | third-party coverage and reimbursement policies; |
• | our ability to meet our repayment and other obligations under our loan agreements; |
• | additions or departures of key personnel; |
• | commencement of, or our involvement in, litigation; |
• | changes in governmental regulations or in the status of our regulatory approvals; |
• | changes in earnings estimates or recommendations by securities analysts; |
• | any major change in our board of directors or management; |
• | results from our clinical trial programs; |
• | our ability to develop and market new and enhanced products or product candidates on a timely basis; |
• | general economic conditions and slow or negative growth of our markets; and |
• | political instability, natural disasters, war and/or events of terrorism. |
• | increase or decrease the authorized number of shares of Series A Convertible Preferred Stock; |
• | authorize, create, issue or obligate us to issue (by reclassification, merger or otherwise) any security (or any class or series thereof) or any indebtedness, in each case that has any rights, preferences or privileges senior to, or on a parity with, the Series A Convertible Preferred Stock, or any security convertible into or exercisable for any such security or indebtedness, subject to limited exceptions for certain debt transactions; |
• | amend our certificate of incorporation or the certificate of designation of the Series A Convertible Preferred Stock, in each case in a manner that adversely affects the rights, preference or privileges of the Series A Convertible Preferred Stock; |
• | redeem, purchase or otherwise acquire (or pay into or set aside for a sinking fund for such purpose) any shares of common stock or preferred stock; provided, however, that this restriction shall not apply to (A) the redemption of rights issued pursuant to any “poison pill” rights plan or similar plan adopted by us after the closing of the Series A Convertible Preferred Stock financing or (B) the repurchases of stock from former employees, officers, directors or consultants who performed services for us in connection with the cessation of such employment or service pursuant to the terms of existing agreements with such individuals; |
• | declare or pay any dividend or distribution on any shares of capital stock; provided, however, that this restriction shall not apply to (A) dividends payable to holders of common stock that consist solely of shares of common stock for which adjustment to the conversion price of the Series A Convertible Preferred Stock is made pursuant to the certificate of designation or (B) dividends or distributions issued pro rata to all holders of capital stock (on an as-converted basis) in connection with the implementation of a “poison pill” rights plan or similar plan by us; |
• | authorize or approve any increase to the number of aggregate shares of capital stock reserved for issuance pursuant to stock option, stock purchase plans or other equity incentive plans such that the total aggregate number of shares issued under such plans and reserved for issuance under such plans (on an as-converted basis) exceeds the number of shares issued and reserved for issuance under such plans (on an as-converted basis) on the date of the closing of the Series A Convertible Preferred Stock financing by more than 20% (as adjusted for stock splits, combinations, stock dividends, recapitalizations and the like), provided that any increases resulting solely from the annual increases resulting from the “evergreen” provisions of equity incentive plans in effect on the date of the closing of the Series A Convertible Preferred Stock financing shall not be subject to this restriction and shall not be included for purposes of determining whether such 20% increase has occurred; or |
• | issue stock or other equity securities of any subsidiary (other than to us or another of our wholly-owned subsidiaries or declare or pay any dividend or other distribution of cash, shares or other assets or redemption or repurchase of shares of any subsidiary; or (viii) incur any secured indebtedness other than certain limited debt transactions. There is no guarantee that the holders of the Series A Convertible Preferred Stock would approve any such restricted action, even where such an action would be in the best interests of our stockholders. Any failure to obtain such approval could harm our business and result in a decrease in the value of our common stock. |
• | authorize the issuance of “blank check” preferred stock that could be issued by our Board of Directors to thwart a takeover attempt; |
• | do not provide for cumulative voting in the election of directors, which would allow holders of less than a majority of our outstanding common stock to elect some directors; |
• | establish a classified Board of Directors, as a result of which the successors to the directors whose terms have expired will be elected to serve from the time of election and qualification until the third annual meeting following their election; |
• | require that directors only be removed from office for cause; |
• | provide that vacancies on the Board of Directors, including newly created directorships, may be filled only by a majority vote of directors then in office; |
• | contain certain protective provisions in favor of the holders of Series A Convertible Preferred Stock; |
• | limit who may call special meetings of stockholders; |
• | prohibit common stockholder action by written consent, requiring all actions of the holders of common stock to be taken at a meeting of the stockholders; and |
• | establish advance notice requirements for nominating candidates for election to the Board of Directors or for proposing matters that can be acted upon by stockholders at stockholder meetings. |
Year Ended December 31, 2016 | High | Low | |||||
First quarter 2016 | $ | 2.75 | $ | 1.49 | |||
Second quarter 2016 | $ | 5.15 | $ | 1.21 | |||
Third quarter 2016 | $ | 2.40 | $ | 1.01 | |||
Fourth quarter 2016 | $ | 1.54 | $ | 1.03 |
Year Ended December 31, 2015 | High | Low | |||||
First quarter 2015 | $ | 5.92 | $ | 4.12 | |||
Second quarter 2015 | $ | 5.18 | $ | 3.98 | |||
Third quarter 2015 | $ | 5.03 | $ | 1.94 | |||
Fourth quarter 2015 | $ | 3.45 | $ | 2.00 |
• | continue the commercialization of ILUVIEN in the U.S. and EEA and through our distributor, in the Middle East; |
• | continue to seek regulatory approval of ILUVIEN in other jurisdictions; |
• | evaluate the use of ILUVIEN for the treatment of other diseases; and |
• | advance the clinical development of any future products or product candidates either currently in our pipeline, or that we may license or acquire in the future. |
• | salaries and related expenses for personnel, including medical sales liaisons; |
• | costs related to the provision of medical affairs support, including symposia development for physician education; |
• | costs related to compliance with FDA, EEA or other regulatory requirements; |
• | fees paid to consultants and contract research organizations (CRO) in conjunction with independently monitoring clinical trials and acquiring and evaluating data in conjunction with clinical trials, including all related fees such as investigator grants, patient screening, lab work and data compilation and statistical analysis; |
• | costs incurred with third parties related to the establishment of a commercially viable manufacturing process for products or product candidates; |
• | costs related to production of clinical materials, including fees paid to contract manufacturers; |
• | costs related to post marketing authorization studies; |
• | consulting fees paid to third-parties involved in research and development activities; and |
• | costs related to stock options or other stock-based compensation granted to personnel in development functions. |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
NET REVENUE | $ | 25,765 | $ | 15,170 | |||
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION | (1,694 | ) | (792 | ) | |||
GROSS PROFIT | 24,071 | 14,378 | |||||
RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES | 7,875 | 9,712 | |||||
GENERAL AND ADMINISTRATIVE EXPENSES | 9,316 | 8,244 | |||||
SALES AND MARKETING EXPENSES | 22,134 | 19,777 | |||||
DEPRECIATION AND AMORTIZATION | 2,678 | 2,491 | |||||
OPERATING EXPENSES | 42,003 | 40,224 | |||||
NET LOSS FROM OPERATIONS | $ | (17,932 | ) | $ | (25,846 | ) |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
NET REVENUE | $ | 8,568 | $ | 7,268 | |||
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION | (650 | ) | (970 | ) | |||
GROSS PROFIT | 7,918 | 6,298 | |||||
RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES | 4,500 | 5,128 | |||||
GENERAL AND ADMINISTRATIVE EXPENSES | 5,947 | 5,946 | |||||
SALES AND MARKETING EXPENSES | 7,297 | 8,313 | |||||
DEPRECIATION AND AMORTIZATION | 89 | 64 | |||||
OPERATING EXPENSES | 17,833 | 19,451 | |||||
NET LOSS FROM OPERATIONS | $ | (9,915 | ) | $ | (13,153 | ) |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
NET LOSS FROM OPERATIONS | $ | (27,847 | ) | $ | (38,999 | ) | |
INTEREST EXPENSE AND OTHER | (5,178 | ) | (4,693 | ) | |||
UNREALIZED FOREIGN CURRENCY LOSS, NET | (40 | ) | (106 | ) | |||
LOSS ON EARLY EXTINGUISHMENT OF DEBT | (2,564 | ) | — | ||||
CHANGE IN FAIR VALUE OF DERIVATIVE WARRANT LIABILITY | 2,627 | 13,283 | |||||
NET LOSS BEFORE TAXES | (33,002 | ) | (30,515 | ) | |||
PROVISION FOR TAXES | (172 | ) | (130 | ) | |||
NET LOSS | $ | (33,174 | ) | $ | (30,645 | ) |
• | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; |
• | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and |
• | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements. |
A | B | C | ||||||||
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants, and Rights | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (A)) | ||||||||
Plan Category | ||||||||||
Equity compensation plans approved by security holders | 10,804,412 | (1) | $ | 3.22 | 1,080,492 | (2) | ||||
Equity compensation plans not approved by security holders | — | — | — | |||||||
Total | 10,804,412 | $ | 3.22 | 1,080,492 |
(1) | Of these shares, 9,736,130 were subject to options then outstanding under the 2010 Plan, 65,072 were subject to options then outstanding under the 2005 Plan and 1,003,210 were subject to options then outstanding under the 2004 Plan. |
(2) | Represents 668,830 shares of common stock available for issuance under our 2010 Plan and 411,662 shares of common stock available for issuance under our ESPP. No shares are available for future issuance under the 2005 Plan or 2004 Plan. In addition, our 2010 Plan provides for annual increases in the number of shares available for issuance thereunder on the first day of each fiscal year equal to the least of: (1) 2,000,000 shares of our common stock; (2) 4% of the shares of common stock outstanding at that time; and (3) such other amount as our board of directors may determine. On January 1, 2017, an additional 2,000,000 shares became available for future issuance under our 2010 Plan in accordance with the annual increase. In addition, our ESPP provides for annual increases in the number of shares available for issuance thereunder equal to such number of shares necessary to restore the number of shares reserved thereunder to 494,422 shares of our common stock. As such, on January 1, 2017, an additional 82,760 shares became available for future issuance under our ESPP. These additional shares from the annual increase under the 2010 Plan and the ESPP are not included in the table above. |
ALIMERA SCIENCES, INC. | ||
By: | /s/ C. Daniel Myers | |
Chief Executive Officer |
Signature | Title | Date | ||
/s/ C. Daniel Myers | Chief Executive Officer and Director (Principal Executive Officer) | March 3, 2017 | ||
C. Daniel Myers | ||||
/s/ Richard S. Eiswirth, Jr. | President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | March 3, 2017 | ||
Richard S. Eiswirth, Jr. | ||||
/s/ James R. Largent | Chairman of the Board of Directors | March 3, 2017 | ||
James R. Largent | ||||
/s/ Glen Bradley, Ph.D. | Director | March 3, 2017 | ||
Glen Bradley, Ph.D. | ||||
/s/ Mark J. Brooks | Director | March 3, 2017 | ||
Mark J. Brooks | ||||
/s/ Brian K. Halak, Ph.D. | Director | March 3, 2017 | ||
Brian K. Halak, Ph.D. | ||||
/s/ Garheng Kong, M.D., Ph.D. | Director | March 3, 2017 | ||
Garheng Kong, M.D., Ph.D. | ||||
/s/ Peter J. Pizzo, III | Director | March 3, 2017 | ||
Peter J. Pizzo, III | ||||
/s/ Calvin W. Roberts, M.D. | Director | March 3, 2017 | ||
Calvin W. Roberts, M.D. |
Page | |
Consolidated Financial Statements as of December 31, 2016 and 2015 and for the years ended December 31, 2016 and 2015: | |
Consolidated Balance Sheets | |
Consolidated Statements of Operations | |
Consolidated Statements of Cash Flows | |
December 31, | |||||||
2016 | 2015 | ||||||
(In thousands, except share and per share data) | |||||||
CURRENT ASSETS: | |||||||
Cash and cash equivalents | $ | 30,979 | $ | 31,075 | |||
Restricted cash | 31 | 37 | |||||
Accounts receivable, net | 13,839 | 9,799 | |||||
Prepaid expenses and other current assets | 2,107 | 2,696 | |||||
Inventory, net (Note 4) | 446 | 1,552 | |||||
Total current assets | 47,402 | 45,159 | |||||
NON-CURRENT ASSETS: | |||||||
Property and equipment — at cost less accumulated depreciation | 1,787 | 2,553 | |||||
Intangible asset, net | 20,604 | 22,549 | |||||
Deferred tax asset | 436 | 223 | |||||
TOTAL ASSETS | $ | 70,229 | $ | 70,484 | |||
CURRENT LIABILITIES: | |||||||
Accounts payable | $ | 4,986 | $ | 4,002 | |||
Accrued expenses (Note 7) | 3,758 | 3,911 | |||||
Derivative warrant liability | 188 | — | |||||
Note payable (Note 9) | — | 31,786 | |||||
Capital lease obligations | 191 | 234 | |||||
Total current liabilities | 9,123 | 39,933 | |||||
NON-CURRENT LIABILITIES: | |||||||
Derivative warrant liability | — | 2,815 | |||||
Note payable — less current portion (Note 9) | 33,084 | — | |||||
Capital lease obligations — less current portion | 274 | 582 | |||||
Other non-current liabilities | 2,162 | 834 | |||||
COMMITMENTS AND CONTINGENCIES (Note 10) | |||||||
STOCKHOLDERS’ EQUITY: | |||||||
Preferred stock, $.01 par value — 10,000,000 shares authorized at December 31, 2016 and 2015: | |||||||
Series A Convertible Preferred Stock, 1,300,000 authorized and 600,000 issued and outstanding at December 31, 2016 and 2015; liquidation preference of $24,000 at December 31, 2016 and 2015 | 19,227 | 19,227 | |||||
Series B Convertible Preferred Stock, 8,417 authorized and 8,416.251 issued and outstanding at December 31, 2016 and 2015; liquidation preference of $50,750 at December 31, 2016 and 2015 | 49,568 | 49,568 | |||||
Common stock, $.01 par value — 150,000,000 shares authorized, 64,862,904 shares issued and outstanding at December 31, 2016 and 100,000,000 shares authorized 45,005,833 shares issued and outstanding at December 31, 2015 | 649 | 450 | |||||
Additional paid-in capital | 330,781 | 299,376 | |||||
Common stock warrants | 3,707 | 2,747 | |||||
Accumulated deficit | (377,074 | ) | (343,900 | ) | |||
Accumulated other comprehensive loss | (1,272 | ) | (1,148 | ) | |||
TOTAL STOCKHOLDERS’ EQUITY | 25,586 | 26,320 | |||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 70,229 | $ | 70,484 |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands, except share and per share data) | |||||||
NET REVENUE | $ | 34,333 | $ | 22,438 | |||
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION | (2,344 | ) | (1,762 | ) | |||
GROSS PROFIT | 31,989 | 20,676 | |||||
RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES | 12,375 | 14,840 | |||||
GENERAL AND ADMINISTRATIVE EXPENSES | 15,263 | 14,190 | |||||
SALES AND MARKETING EXPENSES | 29,431 | 28,090 | |||||
DEPRECIATION AND AMORTIZATION | 2,767 | 2,555 | |||||
OPERATING EXPENSES | 59,836 | 59,675 | |||||
NET LOSS FROM OPERATIONS | (27,847 | ) | (38,999 | ) | |||
INTEREST EXPENSE AND OTHER | (5,178 | ) | (4,693 | ) | |||
UNREALIZED FOREIGN CURRENCY LOSS, NET | (40 | ) | (106 | ) | |||
LOSS ON EARLY EXTINGUISHMENT OF DEBT | (2,564 | ) | — | ||||
CHANGE IN FAIR VALUE OF DERIVATIVE WARRANT LIABILITY | 2,627 | 13,283 | |||||
NET LOSS BEFORE TAXES | (33,002 | ) | (30,515 | ) | |||
PROVISION FOR TAXES | (172 | ) | (130 | ) | |||
NET LOSS | $ | (33,174 | ) | $ | (30,645 | ) | |
NET LOSS PER SHARE — Basic and diluted | $ | (0.63 | ) | $ | (0.69 | ) | |
WEIGHTED AVERAGE SHARES OUTSTANDING — Basic and diluted | 52,801,603 | 44,450,216 |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
NET LOSS | $ | (33,174 | ) | $ | (30,645 | ) | |
OTHER COMPREHENSIVE LOSS | |||||||
Foreign currency translation adjustments | (124 | ) | (336 | ) | |||
TOTAL OTHER COMPREHENSIVE LOSS | (124 | ) | (336 | ) | |||
COMPREHENSIVE LOSS | $ | (33,298 | ) | $ | (30,981 | ) |
Common Stock | Series A Convertible Preferred Stock | Series B Convertible Preferred Stock | Additional Paid-In Capital | Common Stock Warrants | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total | |||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||
(In thousands, except share data) | ||||||||||||||||||||||||||||||||||||||||
BALANCE — December 31, 2014 | 44,320,342 | $ | 443 | 600,000 | $ | 19,227 | 8,416 | $ | 49,568 | $ | 292,851 | $ | 1,497 | $ | (313,255 | ) | $ | (812 | ) | $ | 49,519 | |||||||||||||||||||
Issuance of common stock, net of issuance costs | 341,239 | 4 | — | — | — | — | 920 | — | — | — | 924 | |||||||||||||||||||||||||||||
Exercise of stock options | 344,252 | 3 | — | — | — | — | 568 | — | — | — | 571 | |||||||||||||||||||||||||||||
Modification of common stock warrants | — | — | — | — | — | — | — | 1,250 | — | — | 1,250 | |||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | — | 5,037 | — | — | — | 5,037 | |||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | — | (30,645 | ) | — | (30,645 | ) | |||||||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | — | — | — | (336 | ) | (336 | ) | |||||||||||||||||||||||||||
BALANCE — December 31, 2015 | 45,005,833 | 450 | 600,000 | 19,227 | 8,416 | 49,568 | 299,376 | 2,747 | (343,900 | ) | (1,148 | ) | 26,320 | |||||||||||||||||||||||||||
Issuance of common stock, net of issuance costs | 19,645,539 | 197 | — | — | — | — | 26,225 | — | — | — | 26,422 | |||||||||||||||||||||||||||||
Exercise of stock options | 211,532 | 2 | — | — | — | — | 291 | — | — | — | 293 | |||||||||||||||||||||||||||||
Modification of common stock warrants | — | — | — | — | — | — | — | 590 | — | — | 590 | |||||||||||||||||||||||||||||
Issuance of common stock warrants | — | — | — | — | — | — | — | 370 | — | — | 370 | |||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | — | 4,889 | — | — | — | 4,889 | |||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | — | (33,174 | ) | — | (33,174 | ) | |||||||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | — | — | — | (124 | ) | (124 | ) | |||||||||||||||||||||||||||
BALANCE — December 31, 2016 | 64,862,904 | $ | 649 | 600,000 | $ | 19,227 | 8,416 | $ | 49,568 | $ | 330,781 | $ | 3,707 | $ | (377,074 | ) | $ | (1,272 | ) | $ | 25,586 |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net loss | $ | (33,174 | ) | $ | (30,645 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Depreciation and amortization | 2,767 | 2,555 | |||||
Inventory reserve | 104 | 445 | |||||
Unrealized foreign currency transaction loss | 40 | 106 | |||||
Amortization of debt discount | 1,038 | 836 | |||||
Deferred taxes (benefit) | (213 | ) | (223 | ) | |||
Loss on early extinguishment of debt | 2,564 | — | |||||
Stock compensation expense | 4,889 | 5,037 | |||||
Change in fair value of derivative warrant liability | (2,627 | ) | (13,283 | ) | |||
Changes in assets and liabilities: | |||||||
Accounts receivable | (4,096 | ) | (8,919 | ) | |||
Prepaid expenses and other current assets | 556 | 405 | |||||
Inventory | 1,000 | (386 | ) | ||||
Accounts payable | 1,073 | (487 | ) | ||||
Accrued expenses and other current liabilities | 1,035 | (1,401 | ) | ||||
Other long-term liabilities | (55 | ) | 596 | ||||
Net cash used in operating activities | (25,099 | ) | (45,364 | ) | |||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Purchases of property and equipment | (186 | ) | (451 | ) | |||
Net cash used in investing activities | (186 | ) | (451 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Proceeds from exercise of stock options | 292 | 571 | |||||
Proceeds from sale of common stock | 27,763 | 1,002 | |||||
Payment of issuance cost of common stock | (1,341 | ) | (27 | ) | |||
Payment of Series B convertible preferred stock offering costs | — | (327 | ) | ||||
Payment of debt issuance costs (Note 9) | (1,069 | ) | (264 | ) | |||
Payments on capital lease obligations | (227 | ) | (293 | ) | |||
Changes in restricted cash | 6 | (37 | ) | ||||
Net cash provided by financing activities | 25,424 | 625 | |||||
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS | (235 | ) | (432 | ) | |||
NET DECREASE IN CASH AND CASH EQUIVALENTS | (96 | ) | (45,622 | ) | |||
CASH AND CASH EQUIVALENTS — Beginning of year | 31,075 | 76,697 | |||||
CASH AND CASH EQUIVALENTS — End of year | $ | 30,979 | $ | 31,075 |
SUPPLEMENTAL DISCLOSURES: | |||||||
Cash paid for interest | $ | 3,958 | $ | 4,177 | |||
Cash paid for income taxes | $ | 193 | $ | 263 | |||
Supplemental schedule of noncash investing and financing activities: | |||||||
Property and equipment acquired under capital leases | $ | 76 | $ | 1,098 | |||
Note payable end of term payment accrued but unpaid | $ | 1,400 | $ | 1,050 | |||
Common Stock offering costs accrued but unpaid | $ | — | $ | 52 |
1. | NATURE OF OPERATIONS |
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(in thousands) | |||||||
Beginning balance | $ | 118 | $ | — | |||
Bad debt expense | — | 118 | |||||
Recovery of bad debt reserve | (118 | ) | — | ||||
Ending balance | $ | — | $ | 118 |
Years Ended December 31, | |||||
2016 | 2015 | ||||
Series A convertible preferred stock | 9,022,556 | 9,022,556 | |||
Series B convertible preferred stock | 8,416,251 | 8,416,251 | |||
Series A convertible preferred stock warrants | 4,511,279 | 4,511,279 | |||
Common stock warrants | 1,795,663 | 738,331 | |||
Stock options | 10,804,412 | 9,475,890 | |||
Total | 34,550,161 | 32,164,307 |
December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Component parts (1) | $ | 115 | $ | 131 | |||
Work-in-process (2) | 18 | 333 | |||||
Finished goods | 353 | 1,525 | |||||
Total inventory | 486 | 1,989 | |||||
Inventory reserve | (40 | ) | (437 | ) | |||
Inventory — net | $ | 446 | $ | 1,552 |
December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Furniture and fixtures | $ | 391 | $ | 376 | |||
Office equipment | 838 | 794 | |||||
Automobiles | 762 | 1,028 | |||||
Software | 973 | 902 | |||||
Leasehold improvements | 460 | 439 | |||||
Manufacturing equipment | 997 | 970 | |||||
Total property and equipment | 4,421 | 4,509 | |||||
Less accumulated depreciation and amortization | (2,634 | ) | (1,956 | ) | |||
Property and equipment — net | $ | 1,787 | $ | 2,553 |
Years Ending December 31 | |||
2017 | $ | 1,940 | |
2018 | 1,940 | ||
2019 | 1,940 | ||
2020 | 1,946 | ||
2021 | 1,940 | ||
Thereafter | 10,898 | ||
Total | $ | 20,604 |
December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Accrued clinical investigator expenses | $ | 1,122 | $ | 732 | |||
Accrued other compensation expenses | 1,020 | 804 | |||||
Accrued rebate, chargeback and other revenue reserves | 809 | 452 | |||||
Accrued End of Term Payment (Note 9) | — | 1,050 | |||||
Other accrued expenses | 807 | 873 | |||||
Total accrued expenses | $ | 3,758 | $ | 3,911 |
Years Ending December 31 | (In thousands) | ||
2017 | $ | — | |
2018 | $ | 1,300 | |
2019 | $ | 16,526 | |
2020 | $ | 17,174 | |
Total | $ | 35,000 |
Years Ending December 31 | (In thousands) | ||
2017 | $ | 547 | |
2018 | 512 | ||
2019 | 459 | ||
2020 | 350 | ||
2021 | 268 | ||
Total | $ | 2,136 |
Years Ending December 31 | (In thousands) | ||
2017 | $ | 300 | |
2018 | 289 | ||
2019 | 107 | ||
2020 | 3 | ||
Total | 699 | ||
Less amount representing interest | (41 | ) | |
Less amount representing executory costs | (193 | ) | |
Present value of minimum lease payments | 465 | ||
Less current portion | (191 | ) | |
Non-current portion | $ | 274 |
December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Automobiles | $ | 762 | $ | 1,028 | |||
Office equipment | 63 | 63 | |||||
Less accumulated depreciation | (342 | ) | (212 | ) | |||
Total | $ | 483 | $ | 879 |
Years Ended December 31, | |||||||||||||||
2016 | 2015 | ||||||||||||||
Options | Weighted Average Exercise Price | Options | Weighted Average Exercise Price | ||||||||||||
Options outstanding at beginning of period | 9,475,890 | $ | 3.43 | 7,681,256 | $ | 3.03 | |||||||||
Grants | 2,195,250 | 2.05 | 2,570,000 | 4.62 | |||||||||||
Forfeitures | (581,497 | ) | 3.15 | (431,114 | ) | 4.79 | |||||||||
Exercises | (285,231 | ) | 1.41 | (344,252 | ) | 1.66 | |||||||||
Options outstanding at year end | 10,804,412 | 3.22 | 9,475,890 | 3.43 | |||||||||||
Options exercisable at year end | 7,363,400 | 3.29 | 5,808,528 | 3.27 | |||||||||||
Weighted average per share fair value of options granted during the year | $ | 1.55 | $ | 3.58 |
Shares | Weighted Average Exercise Price | Weighted Average Contractual Term | Aggregate Intrinsic Value | |||||||||
(In thousands) | ||||||||||||
Outstanding | 10,804,412 | $ | 3.22 | 6.45 years | $ | — | ||||||
Exercisable | 7,363,400 | 3.29 | 5.42 years | — | ||||||||
Outstanding, vested and expected to vest | 10,374,846 | 3.23 | 6.35 years | — |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
Risk-free interest rate | 1.57 | % | 1.55 | % | |||
Volatility factor | 93.54 | % | 96.80 | % | |||
Grant date fair value of common stock options | $ | 1.55 | $ | 3.58 | |||
Weighted-average expected life | 5.99 years | 6.03 years | |||||
Assumed forfeiture rate | 10.00 | % | 10.00 | % |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Sales and marketing | $ | 1,109 | $ | 925 | |||
Research, development and medical affairs | 886 | 1,271 | |||||
General and administrative | 2,814 | 2,732 | |||||
Total employee stock-based compensation expense | $ | 4,809 | $ | 4,928 |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
United States | $ | (8,516 | ) | $ | (6,026 | ) | |
Foreign | (24,486 | ) | (24,489 | ) | |||
Loss before provision for income taxes | $ | (33,002 | ) | $ | (30,515 | ) |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Current expense (benefit): | |||||||
Federal | $ | — | $ | — | |||
State | — | — | |||||
Foreign | 385 | 353 | |||||
Current income tax expense | 385 | 353 | |||||
Deferred expense (benefit): | |||||||
Federal | 3,099 | 6,509 | |||||
State | (858 | ) | 819 | ||||
Foreign | (213 | ) | (223 | ) | |||
2,028 | 7,105 | ||||||
Valuation allowance | (2,241 | ) | (7,328 | ) | |||
Deferred income tax benefit | (213 | ) | (223 | ) | |||
Total income tax expense | $ | 172 | $ | 130 |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Valuation allowance at beginning of period | $ | (53,727 | ) | $ | (46,399 | ) | |
Income tax provision | (2,241 | ) | (7,328 | ) | |||
Release of valuation allowance | — | — | |||||
Other | — | — | |||||
Valuation allowance at end of period | $ | (55,968 | ) | $ | (53,727 | ) |
December 31, | |||||||
2016 | 2015 | ||||||
Deferred tax assets | (In thousands) | ||||||
Depreciation and amortization | $ | 12 | $ | 3 | |||
Other deferred tax assets | 5,824 | 4,643 | |||||
NOL carry-forwards | 38,183 | 36,941 | |||||
Research and development costs | 3,063 | 4,193 | |||||
Collaboration agreement receivable reserves | 9,327 | 8,186 | |||||
Valuation allowance | (55,968 | ) | (53,727 | ) | |||
Total deferred tax assets | $ | 441 | $ | 239 | |||
Deferred tax liabilities | |||||||
Unrealized foreign currency gains | $ | — | $ | (12 | ) | ||
Other deferred tax liabilities | (5 | ) | (4 | ) | |||
Total deferred tax liabilities | (5 | ) | (16 | ) | |||
Net deferred tax assets and deferred tax liabilities | $ | 436 | $ | 223 |
Years Ended December 31, | |||||||||||||
2016 | 2015 | ||||||||||||
Amount | Percent | Amount | Percent | ||||||||||
Federal tax benefit at statutory rate | $ | (11,219 | ) | 34.0 | % | $ | (10,375 | ) | 34.0 | % | |||
State tax — net of federal benefit | (10 | ) | — | (715 | ) | 2.4 | |||||||
Permanent items and other | (225 | ) | 0.7 | (3,997 | ) | 13.1 | |||||||
Prior period transfer pricing adjustments | — | — | — | — | |||||||||
Foreign rate differential | 8,470 | (26.1 | ) | 8,352 | (27.4 | ) | |||||||
Deferred rate change | 825 | (2.5 | ) | — | — | ||||||||
Other | 90 | (0.3 | ) | (463 | ) | 1.5 | |||||||
Change in valuation allowance | 2,241 | (6.3 | ) | 7,328 | (24.0 | ) | |||||||
Total tax expense (benefit) | $ | 172 | (0.5 | )% | $ | 130 | (0.4 | )% |
Years Ended December 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Balance of uncertain tax positions at beginning of period | $ | 46 | $ | — | |||
Gross increases - tax positions in current period | 16 | 3 | |||||
Gross increases - tax positions in prior period | 13 | 43 | |||||
Gross decreases - tax positions in prior period | (16 | ) | — | ||||
Settlements | — | — | |||||
Lapse of statute of limitations | — | — | |||||
Balance of uncertain tax positions at end of period | $ | 59 | $ | 46 |
December 31, 2016 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
(In thousands) | |||||||||||||||
Assets: | |||||||||||||||
Cash equivalents (1) | $ | — | $ | — | $ | — | $ | — | |||||||
Assets measured at fair value | $ | — | $ | — | $ | — | $ | — | |||||||
Liabilities: | |||||||||||||||
Derivative warrant liability (2) | $ | — | $ | 188 | $ | — | $ | 188 | |||||||
Liabilities measured at fair value | $ | — | $ | 188 | $ | — | $ | 188 |
December 31, 2015 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
(In thousands) | |||||||||||||||
Assets: | |||||||||||||||
Cash equivalents (1) | $ | 1,010 | $ | — | $ | — | $ | 1,010 | |||||||
Assets measured at fair value | $ | 1,010 | $ | — | $ | — | $ | 1,010 | |||||||
Liabilities: | |||||||||||||||
Derivative warrant liability (2) | $ | — | $ | 2,815 | $ | — | $ | 2,815 | |||||||
Liabilities measured at fair value | $ | — | $ | 2,815 | $ | — | $ | 2,815 |
(1) | The carrying amounts approximate fair value due to the short-term maturities of the cash equivalents. |
(2) | The Company uses the Black-Scholes option pricing model and assumptions that consider, among other variables, the fair value of the underlying stock, risk-free interest rate, volatility, expected life and dividend rates in estimating fair value for the warrants considered to be derivative instruments. Assumptions used are generally consistent with those disclosed for stock based compensation (see Note 12). |
Year Ended December 31, 2016 | |||||||||||
U.S. | International | Consolidated | |||||||||
(In thousands) | |||||||||||
NET REVENUE | $ | 25,765 | $ | 8,568 | $ | 34,333 | |||||
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION | (1,694 | ) | (650 | ) | (2,344 | ) | |||||
GROSS PROFIT | 24,071 | 7,918 | 31,989 | ||||||||
RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES | 7,875 | 4,500 | 12,375 | ||||||||
GENERAL AND ADMINISTRATIVE EXPENSES | 9,316 | 5,947 | 15,263 | ||||||||
SALES AND MARKETING EXPENSES | 22,134 | 7,297 | 29,431 | ||||||||
DEPRECIATION AND AMORTIZATION | 2,678 | 89 | 2,767 | ||||||||
OPERATING EXPENSES | 42,003 | 17,833 | 59,836 | ||||||||
NET LOSS FROM OPERATIONS | (17,932 | ) | (9,915 | ) | (27,847 | ) | |||||
OTHER INCOME AND EXPENSES, NET | (5,155 | ) | |||||||||
NET LOSS BEFORE TAXES | $ | (33,002 | ) |
Year Ended December 31, 2015 | |||||||||||
U.S. | International | Consolidated | |||||||||
(In thousands) | |||||||||||
NET REVENUE | $ | 15,170 | $ | 7,268 | $ | 22,438 | |||||
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION | (792 | ) | (970 | ) | (1,762 | ) | |||||
GROSS PROFIT | 14,378 | 6,298 | 20,676 | ||||||||
RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES | 9,712 | 5,128 | 14,840 | ||||||||
GENERAL AND ADMINISTRATIVE EXPENSES | 8,244 | 5,946 | 14,190 | ||||||||
SALES AND MARKETING EXPENSES | 19,777 | 8,313 | 28,090 | ||||||||
DEPRECIATION AND AMORTIZATION | 2,491 | 64 | 2,555 | ||||||||
OPERATING EXPENSES | 40,224 | 19,451 | 59,675 | ||||||||
NET LOSS FROM OPERATIONS | (25,846 | ) | (13,153 | ) | (38,999 | ) | |||||
OTHER INCOME AND EXPENSES, NET | 8,484 | ||||||||||
NET LOSS BEFORE TAXES | $ | (30,515 | ) |
March 31 | June 30 | September 30 | December 31 | ||||||||||||
(In thousands, except share and per share data) | |||||||||||||||
2016 | |||||||||||||||
NET REVENUE | $ | 5,801 | $ | 9,557 | $ | 8,298 | $ | 10,677 | |||||||
COST OF GOOD SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION | (378 | ) | (556 | ) | (486 | ) | (924 | ) | |||||||
GROSS PROFIT | 5,423 | 9,001 | 7,812 | 9,753 | |||||||||||
LOSS FROM OPERATIONS | (8,790 | ) | (6,449 | ) | (7,243 | ) | (5,365 | ) | |||||||
NET LOSS BEFORE TAXES | (11,136 | ) | (6,816 | ) | (9,212 | ) | (5,838 | ) | |||||||
NET LOSS APPLICABLE TO COMMON STOCKHOLDERS | (11,145 | ) | (6,858 | ) | (9,245 | ) | (5,926 | ) | |||||||
NET LOSS PER SHARE APPLICABLE TO COMMON STOCKHOLDERS - Basic and diluted | (0.25 | ) | (0.15 | ) | (0.16 | ) | (0.09 | ) | |||||||
2015 | |||||||||||||||
NET REVENUE | $ | 3,938 | $ | 5,776 | $ | 6,901 | $ | 5,823 | |||||||
COST OF GOOD SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION | (283 | ) | (376 | ) | (634 | ) | (469 | ) | |||||||
GROSS PROFIT | 3,655 | 5,400 | 6,267 | 5,354 | |||||||||||
LOSS FROM OPERATIONS | (10,994 | ) | (9,800 | ) | (8,444 | ) | (9,761 | ) | |||||||
NET LOSS BEFORE TAXES | (9,793 | ) | (8,596 | ) | (1,543 | ) | (10,713 | ) | |||||||
NET LOSS APPLICABLE TO COMMON STOCKHOLDERS | (9,793 | ) | (8,596 | ) | (1,543 | ) | (10,713 | ) | |||||||
NET LOSS PER SHARE APPLICABLE TO COMMON STOCKHOLDERS - Basic and diluted | (0.22 | ) | (0.19 | ) | (0.03 | ) | (0.24 | ) |
Exhibit | Exhibit | |
Number | Title | |
3.1 | Restated Certificate of Incorporation of Registrant, as amended on various dates (filed as Exhibit 3.2 to Amendment No. 4 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on April 6, 2010, and incorporated herein by reference) | |
3.2 | Amended and Restated Bylaws of the Registrant, as amended (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, as filed on November 5, 2015, and incorporated herein by reference) | |
3.3 | Certificate of Designation of Series A Convertible Preferred Stock (filed as Exhibit 3.5 to the Registrant’s Current Report on Form 8-K, as filed on October 2, 2012, and incorporated herein by reference) | |
3.4 | Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock (filed as Exhibit 3.6 to the Registrant’s Current Report on Form 8-K, as filed on December 15, 2014, and incorporated herein by reference) | |
3.5* | Certificate of Amendment to the Restated Certificate of Incorporation of the Registrant | |
4.1 | Second Amended and Restated Investor Rights Agreement, dated March 17, 2008, by and among the Registrant, certain stockholders and the investors listed on the signature pages thereto (filed as Exhibit 4.3 to Amendment No. 1 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on December 23, 2009, and incorporated herein by reference) | |
4.2 | Second Amended and Restated Stock Sale Agreement, dated March 17, 2008, by and among the Registrant, certain stockholders and the investors listed on the signature pages thereto (filed as Exhibit 4.4 to Amendment No. 1 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on December 23, 2009, and incorporated herein by reference) | |
4.3 | Omnibus Amendment, dated August 25, 2009, by and among the Registrant, certain stockholders and the investors listed on the signature pages thereto (filed as Exhibit 4.5 to Amendment No. 1 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on December 23, 2009, and incorporated herein by reference) | |
4.4 | Warrant to Purchase Stock dated October 14, 2010 issued to Silicon Valley Bank (filed as Exhibit 4.1 to the Registrant’s Current Report, as filed on October 18, 2010, and incorporated herein by reference) | |
4.5 | Warrant to Purchase Stock dated October 14, 2010 issued to MidCap Funding III, LLC (filed as Exhibit 4.2 to the Registrant’s Current Report, as filed on October 18, 2010, and incorporated herein by reference) | |
4.6 | Warrant to Purchase Stock dated May 16, 2011 issued to MidCap Funding III, LLC (filed as Exhibit 4.1 to the Registrant’s Current Report, as filed on May 17, 2011, and incorporated herein by reference) | |
4.7 | Warrant to Purchase Stock dated May 16, 2011 issued to Silicon Valley Bank (filed as Exhibit 4.2 to the Registrant’s Current Report, as filed on May 17, 2011, and incorporated herein by reference) | |
4.8.A | Warrant to Purchase Shares of Series A Preferred issued to Sofinnova Venture Partners VIII, L.P. (filed as Exhibit 4.10.A to the Registrant’s Current Report on Form 8-K, as filed on October 2, 2012, and incorporated herein by reference) | |
4.8.B | Warrant to Purchase Shares of Series A Preferred issued to Growth Equity Opportunities Fund III, LLC (filed as Exhibit 4.10.B to the Registrant’s Current Report on Form 8-K, as filed on October 2, 2012, and incorporated herein by reference) | |
4.8.C | Warrant to Purchase Shares of Series A Preferred issued to Micro Cap Partners, L.P. (filed as Exhibit 4.10.C to the Registrant’s Current Report on Form 8-K, as filed on October 2, 2012, and incorporated herein by reference) | |
4.8.D | Warrant to Purchase Shares of Series A Preferred issued to Palo Alto Healthcare Master Fund, L.P. (filed as Exhibit 4.10.D to the Registrant’s Current Report on Form 8-K, as filed on October 2, 2012, and incorporated herein by reference) | |
4.8.E | Warrant to Purchase Shares of Series A Preferred issued to Palo Alto Healthcare Master Fund II, L.P. (filed as Exhibit 4.10.E to the Registrant’s Current Report on Form 8-K, as filed on October 2, 2012, and incorporated herein by reference) | |
4.9 | Registration Rights Agreement dated October 2, 2012 between the Registrant and Palo Alto Healthcare Master Fund, L.P., Palo Alto Healthcare Master Fund II, L.P., Micro Cap Partners, L.P., Sofinnova Venture Partners VIII L.P. and Growth Equity Opportunities Fund III, LLC (filed as Exhibit 4.11 to the Registrant’s Current Report on Form 8-K, as filed on October 2, 2012, and incorporated herein by reference) | |
4.10 | Amendment No. 1 to Warrant to Purchase Stock dated May 7, 2013 by and between Silicon Valley Bank and the Registrant (filed as Exhibit 4.10 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 14, 2013, and incorporated herein by reference) | |
4.11 | Irrevocable Waiver of Rights to Designate Series A Director dated May 16, 2014 (filed as Exhibit 4.11 to the Registrant’s Current Report on Form 8-K, as filed on May 16, 2014, and incorporated herein by reference) | |
4.12 | Warrant Agreement dated as of April 24, 2014 issued to Hercules Technology Growth Capital, Inc. (filed as Exhibit 4.11 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 11, 2014, and incorporated herein by reference) | |
4.13 | First Amendment to Warrant Agreement dated November 2, 2015 by and among the Registrant and Hercules Technology Growth Capital, Inc. (filed as Exhibit 4.13 to the Registrant’s Annual Report on Form 10-K, as filed on March 15, 2016, and incorporated herein by reference) | |
4.14 | Second Amendment to Warrant Agreement dated March 14, 2016 by and among the Registrant and Hercules Technology Growth Capital, Inc. (filed as Exhibit 4.14 to the Registrant’s Quarterly Report on Form 10-Q, as filed on May 6, 2016, and incorporated herein by reference) | |
4.15 | Third Amendment to Warrant Agreement dated July 21, 2016 by and among the Registrant and Hercules Capital, Inc. f/k/a Hercules Technology Growth Capital, Inc. (filed as Exhibit 4.15 to the Registrant’s Quarterly Report on Form 10-Q, as filed on November 4, 2016, and incorporated herein by reference) | |
4.16 | Warrant Agreement dated October 20, 2016 by and among the Registrant and Hercules Capital, Inc. f/k/a Hercules Technology Growth Capital, Inc. (filed as Exhibit 4.16 to the Registrant’s Quarterly Report on Form 10-Q, as filed on November 4, 2016, and incorporated herein by reference) | |
10.1 | Form of Indemnification Agreement between the Registrant and each of its directors and executive officers (filed as Exhibit 10.1 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on October 30, 2009, and incorporated herein by reference) | |
10.2 | Alimera Sciences, Inc. 2004 Incentive Stock Plan, as amended (filed as Exhibit 10.7 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on October 30, 2009, and incorporated herein by reference) | |
10.3 | Form of Option Certificate under the Alimera Sciences, Inc. 2004 Incentive Stock Plan (filed as Exhibit 10.7.A to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on October 30, 2009, and incorporated herein by reference) | |
10.4 | Alimera Sciences, Inc. 2005 Incentive Stock Plan (filed as Exhibit 10.8 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on October 30, 2009, and incorporated herein by reference) | |
10.5 | Form of Option Certificate under the Alimera Sciences, Inc. 2005 Incentive Stock Plan (filed as Exhibit 10.8.A to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on October 30, 2009, and incorporated herein by reference) | |
10.6 | 2010 Equity Incentive Plan (filed as Exhibit 10.9 to Amendment No. 4 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on April 6, 2010, and incorporated herein by reference) | |
10.7 | 2010 Employee Stock Purchase Plan (filed as Exhibit 10.10 to Amendment No. 4 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on April 6, 2010, and incorporated herein by reference) | |
10.7.A | Amendment No. 1 to 2010 Employee Stock Purchase Plan | |
10.8 | Management Cash Incentive Plan (filed as Exhibit 10.11 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on October 30, 2009, and incorporated herein by reference) | |
10.9 | Compensation Program for Non-Employee Directors (filed as Exhibit 10.12 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on October 30, 2009, and incorporated herein by reference) | |
10.10‡ | Amended and Restated Collaboration Agreement by and between pSivida, Inc. (f/k/a/Control Delivery Systems, Inc.) and Alimera Sciences, Inc., dated as of March 14, 2008 (filed as Exhibit 10.13 to Amendment No. 5 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on April 16, 2010, and incorporated herein by reference) | |
10.11 | Office Lease by and between Rubicon, L.C. and Alimera Sciences, Inc., dated as of May 27, 2003, as amended (filed as Exhibit 10.18 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on October 30, 2009, and incorporated herein by reference) | |
10.12‡ | Commercial Contract Manufacturing Agreement, between Alimera Sciences, Inc. and Alliance Medical Products, Inc., dated February 5, 2010 (filed as Exhibit 10.26 to Amendment No. 6 to the Registrant’s Registration Statement on Form S-1 (SEC File No. 333-162782), as filed on April 20, 2010, and incorporated herein by reference) | |
10.13 | Form of Notice of Stock Option Grant and Stock Option Agreement under 2010 Equity Incentive Plan (filed as Exhibit 10.30 to Registrant’s Annual Report on Form 10-K, as filed on March 25, 2011, and incorporated herein by reference) | |
10.14‡ | Amendment to Manufacturing Agreement between Registrant and Alliance Medical Products, Inc. (filed as Exhibit 10.3 to Registrant’s Quarterly Report on Form 10-Q, as filed on August 5, 2011, and incorporated herein by reference) | |
10.15 | Form of Notice of Stock Unit Award and Stock Unit Agreement under 2010 Equity Incentive Plan (filed as Exhibit 10.34 to Registrant’s Annual Report on Form 10-K, as filed on March 30, 2012, and incorporated herein by reference) | |
10.16‡ | Manufacturing Agreement by and between the Registrant and Flextronics Medical Sales and Marketing, Ltd. (filed as Exhibit 10.35 to Registrant’s Quarterly Report on Form 10-Q, as filed on August 14, 2012, and incorporated herein by reference) | |
10.17 | Securities Purchase Agreement dated July 17, 2012 (filed as Exhibit 10.36 to the Registrant’s Current Report, as filed on July 18, 2012, and incorporated herein by reference) | |
10.18 | Amendment No. 1 to Securities Purchase Agreement dated September 21, 2012 (filed as Exhibit 10.37 to the Registrant’s Current Report, as filed on October 2, 2012, and incorporated herein by reference) | |
10.19 | UK Sub-Plan of the 2010 Equity Incentive Plan of Alimera Sciences, Inc. (filed as Exhibit 10.38 to the Registrant’s Quarterly Report on Form 10-Q, as filed on November 7, 2012, and incorporated herein by reference and replaced by exhibit 10.46) | |
10.20 | Form of UK Sub-Plan Notice of Stock Option Grant and Stock Option Agreement (filed as Exhibit 10.39 to the Registrant’s Quarterly Report on Form 10-Q, as filed on November 7, 2012, and incorporated herein by reference) | |
10.21 | Form of France Sub-Plan of the 2010 Equity Incentive Plan of Alimera Sciences, Inc. (filed as Exhibit 10.21 to the Registrant’s Annual Report on Form 10-K, as filed on March 15, 2016, and incorporated herein by reference) | |
10.22 | Employment Contract dated November 3, 2012 by and between the Registrant and Philip Ashman (filed as Exhibit 10.40 to the Registrant’s Annual Report on Form 10-K, as filed on March 28, 2013) | |
10.23 | Loan and Security Agreement dated May 7, 2013 between Silicon Valley Bank and Alimera Sciences Limited (filed as Exhibit 10.42 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 14, 2013) | |
10.24 | Security Agreement entered into as of May 7, 2013 by and between Silicon Valley Bank and the Registrant (filed as Exhibit 10.43 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 14, 2013) | |
10.25 | Unconditional Guaranty entered into as of May 7, 2013 by Alimera Sciences B.V. in favor of Silicon Valley Bank (filed as Exhibit 10.44 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 14, 2013) | |
10.26 | Unconditional Guaranty entered into as of May 7, 2013 by AS C.V. in favor of Silicon Valley Bank (filed as Exhibit 10.45 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 14, 2013) | |
10.27 | Unconditional Guaranty entered into as of May 7, 2013 by the Registrant in favor of Silicon Valley Bank (filed as Exhibit 10.46 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 14, 2013) | |
10.28 | Second Loan Modification Agreement entered into as of May 7, 2013 by and between Silicon Valley Bank and the Registrant (filed as Exhibit 10.47 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 14, 2013) | |
10.29 | Securities Purchase Agreement dated January 27, 2014 (filed as Exhibit 10.42 to the Registrant’s Current Report, as filed on January 27, 2014, and incorporated herein by reference) | |
10.30 | Loan and Security Agreement dated as of April 24, 2014 by and among Alimera Sciences Limited, the several banks and other financial institutions or entities from time to time parties thereto and Hercules Technology Growth Capital, Inc. (filed as Exhibit 10.49 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 11, 2014, and incorporated herein by reference) | |
10.31 | First Amendment to Loan and Security Agreement dated November 2, 2015 by and among Alimera Sciences Limited, Hercules Capital Funding Trust and Hercules Technology Growth Capital, Inc. (filed as Exhibit 10.31 to the Registrant’s Annual Report on Form 10-K, as filed on March 15, 2016, and incorporated herein by reference) | |
10.32 | Unconditional Guaranty entered into as of April 24, 2014 by the Registrant in favor of Hercules Technology Growth Capital, Inc. (filed as Exhibit 10.50 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 11, 2014, and incorporated herein by reference) | |
10.33 | Unconditional Guaranty entered into as of April 24, 2014 by Alimera Sciences B.V. in favor of Hercules Technology Growth Capital, Inc. (filed as Exhibit 10.51 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 11, 2014, and incorporated herein by reference) | |
10.34 | Unconditional Guaranty entered into as of April 24, 2014 by AS C.V. in favor of Hercules Technology Growth Capital, Inc. (filed as Exhibit 10.52 to the Registrant’s Quarterly Report on Form 10-Q, as filed on August 11, 2014, and incorporated herein by reference) | |
10.35 | Sales Agreement dated September 22, 2014 (filed as Exhibit 10.53 to the Registrant’s Current Report on Form 8-K, as filed on September 22, 2014, and incorporated herein by reference) | |
10.36† | Amended and Restated Employment Agreement, effective as of October 23, 2014, by and between the Registrant and C. Daniel Myers (filed as Exhibit 10.53 to the Registrant’s Current Report on Form 8-K, as filed on October 23, 2014, and incorporated herein by reference) | |
10.37† | Amended and Restated Employment Agreement, effective as of October 23, 2014, by and between the Registrant and Richard S. Eiswirth, Jr. (filed as Exhibit 10.54 to the Registrant’s Current Report on Form 8-K, as filed on October 23, 2014, and incorporated herein by reference) | |
10.38† | Amended and Restated Employment Agreement, effective as of October 23, 2014, by and between the Registrant and Kenneth Green, Ph.D. (filed as Exhibit 10.55 to the Registrant’s Current Report on Form 8-K, as filed on October 23, 2014, and incorporated herein by reference) | |
10.39† | Amended and Restated Employment Agreement, effective as of October 23, 2014, by and between the Registrant and David Holland (filed as Exhibit 10.39 to the Registrant’s Annual Report on Form 10-K, as filed on March 15, 2016, and incorporated herein by reference) | |
10.40 | Securities Purchase Agreement dated November 26, 2014 (filed as Exhibit 10.56 to the Registrant’s Current Report on Form 8-K, as filed on November 28, 2014, and incorporated herein by reference) | |
10.41‡ | First Amended and Restated Commercial Contract Manufacturing Agreement dated as of February 5, 2016 by and between Alimera Sciences, Inc. and Alliance Medical Products, Inc. d.b.a. Siegfried Irvine (filed as Exhibit 10.41 to the Registrant’s Quarterly Report on Form 10-Q, as filed on May 6, 2016, and incorporated herein by reference) | |
10.42 | Second Amendment to Loan and Security Agreement dated March 14, 2016 by and among Alimera Sciences Limited, Hercules Capital Funding Trust and Hercules Capital, Inc. f/k/a Hercules Technology Growth Capital, Inc. (filed as Exhibit 10.42 to the Registrant’s Quarterly Report on Form 10-Q, as filed on May 6, 2016, and incorporated herein by reference) | |
10.43 | Third Amendment to Loan and Security Agreement dated May 26, 2016 by and among Alimera Sciences Limited, Hercules Capital Funding Trust and Hercules Capital, Inc. f/k/a Hercules Technology Growth Capital, Inc. (filed as Exhibit 10.43 to the Registrant’s Current Report on Form 8-K, as filed on May 27, 2016, and incorporated herein by reference) | |
10.44 | Waiver by Hercules Capital, Inc. of Certain Defaults under Loan and Security Agreement dated July 21, 2016 (filed as Exhibit 10.45 to the Registrant’s Quarterly Report on Form 10-Q, as filed on November 4, 2016 and incorporated herein by reference) | |
10.45 | Fourth Amendment to Loan and Security Agreement dated October 20, 2016 by and among Alimera Sciences Limited, Hercules Capital Funding Trust and Hercules Capital, Inc. f/k/a/ Hercules Technology Growth Capital, Inc. (filed as Exhibit 10.45 to the Registrant’s Quarterly Report on Form 10-Q, as filed on November 4, 2016 and incorporated herein by reference) | |
10.46* | (2017) UK Sub-Plan of the 2010 Equity Incentive Plan of Alimera Sciences, Inc. | |
10.47* | Forms of Notice of Restricted Stock Unit Award and restricted Stock Unit Agreement under 2010 Equity Incentive Plan for the U.S., Germany, Portugal and the United Kingdom | |
21.1 | List of subsidiaries of the Registrant (including jurisdiction of organization and names under which subsidiaries do business) (filed as Exhibit 21.1 to the Registrant’s Annual Report on Form 10-K, as filed on March 15, 2016, and incorporated herein by reference) | |
23.1* | Consent of Grant Thornton LLP, Independent Registered Public Accounting Firm | |
31.1* | Certification of the Chief Executive Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2* | Certification of the Chief Financial Officer as required by Section 302 of the Sarbanes-Oxley Act of 2002 | |
32.1* | Certifications of the Chief Executive Officer and Chief Financial Officer as required by 18 U.S.C. 1350 | |
101.INS+* | XBRL Instance Document | |
101.SCH+* | XBRL Taxonomy Extension Schema Document | |
101.CAL+* | XBRL Taxonomy Extension Calculation Linkbase Document | |
101.DEF+* | XBRL Taxonomy Extension Definition Linkbase Document | |
101.LAB+* | XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE+* | XBRL Taxonomy Extension Presentation Linkbase Document |
† | Compensation Arrangement. |
‡ | Confidential treatment has been granted with respect to certain portions of this document. |
* | Filed herewith. |
/s/ Richard S. Eiswirth, Jr. |
Richard S. Eiswirth. Jr. |
President and Chief Financial Officer |
1. | The purpose of this Sub-Plan is to provide incentives for present and future UK tax resident employees of Alimera Sciences Limited through the grant of options over shares of Common Stock of Alimera Sciences, Inc. (the "Company"). |
2. | Capitalized terms are defined in the Company’s 2010 Equity Incentive Plan (the “Plan”), subject to the provisions of this Sub-Plan. |
3. | References to ISOs and NSOs shall not apply to Options granted under the Sub-Plan. |
4. | Options granted under this Sub-Plan shall be taxed in the UK as Unapproved Options. |
5. | This Sub-Plan is governed by THE Plan and all its provisions shall be identical to those of the Plan SAVE THAT (i) "Sub-Plan" shall be substituted for "Plan" where applicable and (ii) the following provisions shall be as stated in this Sub-Plan in order to accommodate the specific requirements of the laws of England and Wales and the appropriate UK tax legislation. |
6. | ARTICLE 1. INTRODUCTION. |
7. | ARTICLE 2. ADMINISTRATION. |
8. | ARTICLE 3. SHARES AVAILABLE FOR GRANTS. |
9. | ARTICLE 4. ELIGIBILITY. |
10. | ARTICLE 5. OPTIONS. |
(a) | An unauthorized use or disclosure by the Participant of the Company’s confidential information or trade secrets, which use or disclosure causes material harm to the Company; |
(b) | A material breach by the Participant of any agreement between the Optionee and the Company; |
(c) | A material failure by the Participant to comply with the Company’s written policies or rules; |
(d) | The Participant’s conviction of, or plea of “guilty” or “no contest” to, a felony under the laws of the United States or any State thereof, or crime under any other applicable law; |
(f) | A continuing failure by the Participant to perform assigned duties after receiving written notification of such failure from the Board; or |
(g) | A failure by the Participant to cooperate in good faith with a governmental or internal investigation of the Company or its directors, officers or employees, if the Company has requested the Participant’s cooperation. |
Name of Recipient: | [Insert Name] |
Total Number of Units Granted: | [Insert Number] |
Date of Grant: | [Date of Grant] |
Vesting Schedule: | 100% of the units subject to this award will vest on [Insert Vesting Date] |
Payment for Units | No payment is required for the units that you are receiving. |
Vesting | The units vest as shown in the Notice of Stock Unit Award. No additional units vest after your Service has terminated for any reason. |
Forfeiture | If your Service terminates for any reason, then your units will be forfeited to the extent that they have not vested before the termination date. This means that any units that have not vested under this Agreement will be cancelled immediately. You receive no payment for units that are forfeited. The Company determines when your Service terminates for this purpose. |
Settlement of Units | Each unit will be settled on the Vesting Date, or the next Trading Day (as defined below) if the Vesting Date is not a Trading Day. However, each unit must be settled no later than the March 15th of the calendar year following the calendar year in which it vests. At the time of settlement, you will receive one share of the Company’s Common Stock for each vested unit. |
“Permissible Trading Day” | “Permissible Trading Day” means a day that satisfies each of the following requirements: • The Nasdaq Global Market is open for trading on that day; • You are permitted to sell shares of the Company’s Common Stock on that day without incurring liability under Section 16(b) of the Securities Exchange Act of 1934, as amended; • Either (a) you are not in possession of material non-public information that would make it illegal for you to sell shares of the Company’s Common Stock on that day under Rule 10b-5 of the Securities and Exchange Commission or (b) Rule 10b5 1 of the Securities and Exchange Commission is applicable; • Under the Company’s Securities Trading Policy, you are permitted to sell shares of the Company’s Common Stock on that day; and • You are not prohibited from selling shares of the Company’s Common Stock on that day by a written agreement between you and the Company or a third party. |
Section 409A | This paragraph applies only if the Company determines that you are a “specified employee,” as defined in the regulations under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), at the time of your “separation from service,” as defined in those regulations. If this paragraph applies, then any units that otherwise would have been settled during the first six months following your separation from service will instead be settled during the seventh month following your separation from service, unless the settlement of those units is exempt from Section 409A of the Code. |
Nature of Units | Your units are mere bookkeeping entries. They represent only the Company’s unfunded and unsecured promise to issue shares of Common Stock on a future date. As a holder of units, you have no rights other than the rights of a general creditor of the Company. |
No Voting Rights or Dividends | Your units carry neither voting rights nor rights to cash dividends. You have no rights as a stockholder of the Company unless and until your units are settled by issuing shares of the Company’s Common Stock. |
Units Nontransferable | You may not sell, transfer, assign, pledge or otherwise dispose of any units. For instance, you may not use your units as security for a loan. |
Withholding Taxes | Unless you elect prior to March 31, 2017, which election must be made on a Permissible Trading Day, to satisfy Withholding Taxes through any of the following means or by a combination of such means: (i) withholding from any compensation otherwise payable to you by the Company or an Affiliate; or (ii) tendering a cash payment to the Company (which may be in the form of a check, electronic wire transfer or other method permitted by the Company), then to the greatest extent permitted under the Plan and applicable law, applicable Withholding Taxes will be satisfied through the mandatory sale of a number of the shares subject to the Award and the remittance of the cash proceeds of such sale to the Company, pursuant to a “same day sale.” You authorize the Company to make payment from the cash proceeds of this sale directly to the appropriate taxing authorities in an amount equal to the Withholding Taxes. It is the Company’s intent that the mandatory sale to cover Withholding Taxes imposed by the Company on the Participant in connection with the receipt of this Award comply with the requirements of Rule 10b5-1(c)(1)(i)(B) under the Exchange Act and be interpreted to comply with the requirements of Rule 10b5-1(c). If, for any reason, such “same day sale” commitment does not result in sufficient proceeds to satisfy the Withholding Taxes, the Company or an Affiliate may, in its sole discretion, satisfy all or any portion of the Withholding Taxes relating to your Award by any of the following means or by a combination of such means: (i) withholding from any compensation otherwise payable to you by the Company or an Affiliate; or (ii) causing you to tender a cash payment (which may be in the form of a check, electronic wire transfer or other method permitted by the Company). Unless the tax withholding obligations of the Company and/or any Affiliate are satisfied, the Company shall have no obligation to deliver to you any Common Stock. Withholding Taxes shall be equal to the Company’s required tax withholding obligations using the minimum statutory withholding rates for federal, state, local and foreign tax purposes, including payroll taxes, that are applicable to supplemental taxable income. |
Restrictions on Resale | You agree not to sell any shares at a time when applicable laws, Company policies or an agreement between the Company and its underwriters prohibit a sale. This restriction will apply as long as your Service continues and for such period of time after the termination of your Service as the Company may specify. |
Employment at Will | Your award or this Agreement does not give you the right to be retained by the Company or a subsidiary of the Company in any capacity. The Company and its subsidiaries reserve the right to terminate your Service at any time, with or without cause. |
Adjustments | In the event of a stock split, a stock dividend or a similar change in Company stock, the number of your units will be adjusted accordingly, as the Company may determine pursuant to the Plan. |
Beneficiary Designation | You may dispose of your units in a written beneficiary designation. A beneficiary designation must be filed with the Company on the proper form. It will be recognized only if it has been received at the Company’s headquarters before your death. If you file no beneficiary designation or if none of your designated beneficiaries survives you, then your estate will receive any vested units that you hold at the time of your death. |
Effect of Merger | If the Company is a party to a merger, consolidation or reorganization, then your units will be subject to the applicable provision of the Plan, provided that any action taken must either (a) preserve the exemption of your units from Section 409A of the Code or (b) comply with Section 409A of the Code. |
Applicable Law | This Agreement will be interpreted and enforced under the laws of the State of Delaware (without regard to their choice-of-law provisions). |
The Plan and Other Agreements | The text of the Plan is incorporated in this Agreement by reference. The Plan, this Agreement and the Notice of Restricted Stock Unit Award constitute the entire understanding between you and the Company regarding this award. Any prior agreements, commitments or negotiations concerning this award are superseded. This Agreement may be amended only by another written agreement between the parties. |
Name of Recipient: | [Insert Name] |
Total Number of Units Granted: | [Insert Number] |
Date of Grant: | [Date of Grant] |
Vesting Schedule: | 100% of the units subject to this award will vest on [Insert Vesting Date] |
Payment for Units | No payment is required for the units that you are receiving. |
Vesting | The units vest as shown in the Notice of Stock Unit Award. No additional units vest after your Service has terminated for any reason. |
Forfeiture | If your Service terminates for any reason, then your units will be forfeited to the extent that they have not vested before the termination date. This means that any units that have not vested under this Agreement will be cancelled immediately. You receive no payment for units that are forfeited. The Company determines when your Service terminates for this purpose. |
Settlement of Units | Each unit will be settled on the first Permissible Trading Day that occurs on or after the day when the units vest. However, each unit must be settled no later than the March 15th of the calendar year following the calendar year in which it vests. At the time of settlement, you will receive one share of the Company’s Common Stock for each vested unit. |
“Permissible Trading Day” | “Permissible Trading Day” means a day that satisfies each of the following requirements: • The Nasdaq Global Market is open for trading on that day; • You are permitted to sell shares of the Company’s Common Stock on that day without incurring liability under Section 16(b) of the Securities Exchange Act of 1934, as amended; • Either (a) you are not in possession of material non-public information that would make it illegal for you to sell shares of the Company’s Common Stock on that day under Rule 10b-5 of the Securities and Exchange Commission or (b) Rule 10b5 1 of the Securities and Exchange Commission is applicable; • Under the Company’s Securities Trading Policy, you are permitted to sell shares of the Company’s Common Stock on that day; and • You are not prohibited from selling shares of the Company’s Common Stock on that day by a written agreement between you and the Company or a third party. |
Section 409A | This paragraph applies only if the Company determines that you are a “specified employee,” as defined in the regulations under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), at the time of your “separation from service,” as defined in those regulations. If this paragraph applies, then any units that otherwise would have been settled during the first six months following your separation from service will instead be settled during the seventh month following your separation from service, unless the settlement of those units is exempt from Section 409A of the Code. |
Nature of Units | Your units are mere bookkeeping entries. They represent only the Company’s unfunded and unsecured promise to issue shares of Common Stock on a future date. As a holder of units, you have no rights other than the rights of a general creditor of the Company. |
No Voting Rights or Dividends | Your units carry neither voting rights nor rights to cash dividends. You have no rights as a stockholder of the Company unless and until your units are settled by issuing shares of the Company’s Common Stock. |
Units Nontransferable | The units are non-tradable. You may not sell, transfer, assign, pledge or otherwise dispose of any units. For instance, you may not use your units as security for a loan. |
Withholding Taxes | Unless you elect prior to March 31, 2017, which election must be made on a Permissible Trading Day, to satisfy Withholding Taxes through any of the following means or by a combination of such means: (i) withholding from any compensation otherwise payable to you by the Company, a Subsidiary or an Affiliate; or (ii) tendering a cash payment to the Company, a Subsidiary or the Affiliate (which may be in the form of a check, electronic wire transfer or other method permitted by the Company), then to the greatest extent permitted under the Plan and applicable law, applicable Withholding Taxes will be satisfied through the mandatory sale of a number of the shares subject to the Award and the remittance of the cash proceeds of such sale to the Company, pursuant to a “same day sale” also known as a "exercise-and-sell-version". You authorize the Company, a Subsidiary or an Affiliate to make payment from the cash proceeds of this sale directly to the appropriate taxing authorities in an amount equal to the Withholding Taxes. It is the Company’s intent that the mandatory sale to cover Withholding Taxes imposed by the Company on the Participant in connection with the receipt of this Award comply with the requirements of Rule 10b5-1(c)(1)(i)(B) under the Exchange Act and be interpreted to comply with the requirements of Rule 10b5-1(c). If, for any reason, such “same day sale” commitment does not result in sufficient proceeds to satisfy the Withholding Taxes, the Company, a Subsidiary or an Affiliate may, in its sole discretion, satisfy all or any portion of the Withholding Taxes relating to your Award by any of the following means or by a combination of such means: (i) withholding from any compensation otherwise payable to you by the Company, a Subsidiary or an Affiliate; or (ii) causing you to tender a cash payment (which may be in the form of a check, electronic wire transfer or other method permitted by the Company). Unless the tax withholding obligations of the Company and/or any Subsidiary or Affiliate are satisfied, the Company shall have no obligation to deliver to you any Common Stock. Withholding Taxes shall be equal to the Company’s or its Subsidiary's or Affiliate's required tax withholding obligations using the minimum statutory withholding rates for federal, state, local and foreign tax purposes, including payroll taxes, that are applicable to supplemental taxable income. |
Restrictions on Resale | You agree not to sell any shares at a time when applicable laws, Company policies or an agreement between the Company and its underwriters prohibit a sale. This restriction will apply as long as your Service continues and for such period of time after the termination of your Service as the Company may specify. |
Employment at Will | Your award or this Agreement does not give you the right to be retained by the Company or an Affiliate or a Subsidiary in any capacity. The Company and its Affiliates or Subsidiaries reserve the right to terminate your Service at any time, with or without cause. |
Adjustments | In the event of a stock split, a stock dividend or a similar change in Company stock, the number of your units will be adjusted accordingly, as the Company may determine pursuant to the Plan. |
Beneficiary Designation | You may dispose of your units in a written beneficiary designation. A beneficiary designation must be filed with the Company on the proper form. It will be recognized only if it has been received at the Company’s headquarters before your death. If you file no beneficiary designation or if none of your designated beneficiaries survives you, then your estate will receive any vested units that you hold at the time of your death. |
Effect of Merger | If the Company is a party to a merger, consolidation or reorganization, then your units will be subject to the applicable provision of the Plan, provided that any action taken must either (a) preserve the exemption of your units from Section 409A of the Code or (b) comply with Section 409A of the Code. |
Applicable Law | This Agreement will be interpreted and enforced under the laws of the State of Delaware (without regard to their choice-of-law provisions). |
The Plan and Other Agreements | The text of the Plan is incorporated in this Agreement by reference. The Plan, this Agreement and the Notice of Restricted Stock Unit Award constitute the entire understanding between you and the Company regarding this award. Any prior agreements, commitments or negotiations concerning this award are superseded. This Agreement may be amended only by another written agreement between the parties. |
Name of Recipient: | [Insert Name] |
Total Number of Units Granted: | [Insert Number] |
Date of Grant: | [Date of Grant] |
Vesting Schedule: | 100% of the units subject to this award will vest on [Insert Vesting Date] |
Payment for Units | No payment is required for the units that you are receiving. |
Vesting | The units vest as shown in the Notice of Stock Unit Award. No additional units vest after your Service has terminated for any reason. |
Forfeiture | If your Service terminates for any reason, then your units will be forfeited to the extent that they have not vested before the termination date. This means that any units that have not vested under this Agreement will be cancelled immediately. You receive no payment for units that are forfeited. The Company determines when your Service terminates for this purpose. |
Settlement of Units | Each unit will be settled on the Vesting Date, or the next Trading Day (as defined below) if the Vesting Date is not a Trading Day. However, each unit must be settled no later than the March 15th of the calendar year following the calendar year in which it vests. At the time of settlement, you will receive one share of the Company’s Common Stock for each vested unit. |
“Permissible Trading Day” | “Permissible Trading Day” means a day that satisfies each of the following requirements: • The Nasdaq Global Market is open for trading on that day; • You are permitted to sell shares of the Company’s Common Stock on that day without incurring liability under Section 16(b) of the Securities Exchange Act of 1934, as amended; • Either (a) you are not in possession of material non-public information that would make it illegal for you to sell shares of the Company’s Common Stock on that day under Rule 10b-5 of the Securities and Exchange Commission or (b) Rule 10b5 1 of the Securities and Exchange Commission is applicable; • Under the Company’s Securities Trading Policy, you are permitted to sell shares of the Company’s Common Stock on that day; and • You are not prohibited from selling shares of the Company’s Common Stock on that day by a written agreement between you and the Company or a third party. |
Section 409A | This paragraph applies only if the Company determines that you are a “specified employee,” as defined in the regulations under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), at the time of your “separation from service,” as defined in those regulations. If this paragraph applies, then any units that otherwise would have been settled during the first six months following your separation from service will instead be settled during the seventh month following your separation from service, unless the settlement of those units is exempt from Section 409A of the Code. |
Nature of Units | Your units are mere bookkeeping entries. They represent only the Company’s unfunded and unsecured promise to issue shares of Common Stock on a future date. As a holder of units, you have no rights other than the rights of a general creditor of the Company. |
No Voting Rights or Dividends | Your units carry neither voting rights nor rights to cash dividends. You have no rights as a stockholder of the Company unless and until your units are settled by issuing shares of the Company’s Common Stock. |
Units Nontransferable | You may not sell, transfer, assign, pledge or otherwise dispose of any units. For instance, you may not use your units as security for a loan. |
Withholding Taxes | Presently, there is no withholding tax in relation to your Award, since benefits in kind, although taxable, are excluded from the scope of withholding tax obligations, pursuant to the Portuguese tax legislation in force. If the Portuguese legislation is altered in the future, and withholding tax obligations arise in connection with the Award, the Company or an Affiliate may, in its sole discretion, satisfy all or any portion of the Withholding Taxes relating to your Award by any of the following means or by a combination of such means: (i) withholding from any compensation otherwise payable to you by the Company or an Affiliate; or (ii) causing you to tender a cash payment (which may be in the form of a check, electronic wire transfer or other method permitted by the Company). Unless the tax withholding obligations of the Company and/or any Affiliate are satisfied, the Company shall have no obligation to deliver to you any Common Stock. Withholding Taxes shall be equal to the Company’s required tax withholding obligations as established in the applicable law, if withholding tax becomes due in the future, over benefits in kind attributed to employees. |
Restrictions on Resale | You agree not to sell any shares at a time when applicable laws, Company policies or an agreement between the Company and its underwriters prohibit a sale. This restriction will apply as long as your Service continues and for such period of time after the termination of your Service as the Company may specify. |
Employment at Will | Your award or this Agreement does not give you the right to be retained by the Company or a subsidiary of the Company in any capacity. The Company and its subsidiaries reserve the right to terminate your Service at any time, with or without cause. |
Adjustments | In the event of a stock split, a stock dividend or a similar change in Company stock, the number of your units will be adjusted accordingly, as the Company may determine pursuant to the Plan. |
Beneficiary Designation | You may dispose of your units in a written beneficiary designation. A beneficiary designation must be filed with the Company on the proper form. It will be recognized only if it has been received at the Company’s headquarters before your death. If you file no beneficiary designation or if none of your designated beneficiaries survives you, then your estate will receive any vested units that you hold at the time of your death. |
Effect of Merger | If the Company is a party to a merger, consolidation or reorganization, then your units will be subject to the applicable provision of the Plan, provided that any action taken must either (a) preserve the exemption of your units from Section 409A of the Code or (b) comply with Section 409A of the Code. |
Applicable Law | This Agreement will be interpreted and enforced under the laws of the State of Delaware (without regard to their choice-of-law provisions). |
The Plan and Other Agreements | The text of the Plan is incorporated in this Agreement by reference. The Plan, this Agreement and the Notice of Restricted Stock Unit Award constitute the entire understanding between you and the Company regarding this award. Any prior agreements, commitments or negotiations concerning this award are superseded. This Agreement may be amended only by another written agreement between the parties. |
Total Number of Units Granted: | [Insert Number] |
Date of Grant: | [Date of Grant] |
Vesting Schedule: | 100% of the units subject to this award will vest on [Insert Vesting Date] |
Payment for Units | No payment is required for the units that you are receiving. |
Vesting | The units vest as shown in the Notice of Stock Unit Award. No additional units vest after your Service has terminated for any reason. |
Forfeiture | If your Service terminates for any reason, then your units will be forfeited to the extent that they have not vested before the termination date. This means that any units that have not vested under this Agreement will be cancelled immediately. You receive no payment for units that are forfeited. The Company determines when your Service terminates for this purpose. |
Settlement of Units | Each unit will be settled on the Vesting Date, or the next Trading Day (as defined below) if the Vesting Date is not a Trading Day. However, each unit must be settled no later than the March 15th of the calendar year following the calendar year in which it vests. At the time of settlement, you will receive one share of the Company’s Common Stock for each vested unit. |
“Permissible Trading Day” | “Permissible Trading Day” means a day that satisfies each of the following requirements: • The Nasdaq Global Market is open for trading on that day; • You are permitted to sell shares of the Company’s Common Stock on that day without incurring liability under Section 16(b) of the Securities Exchange Act of 1934, as amended; • Either (a) you are not in possession of material non-public information that would make it illegal for you to sell shares of the Company’s Common Stock on that day under Rule 10b-5 of the Securities and Exchange Commission or (b) Rule 10b5 1 of the Securities and Exchange Commission is applicable; • Under the Company’s Securities Trading Policy, you are permitted to sell shares of the Company’s Common Stock on that day; and • You are not prohibited from selling shares of the Company’s Common Stock on that day by a written agreement between you and the Company or a third party. |
Section 409A | This paragraph applies only if the Company determines that you are a “specified employee,” as defined in the regulations under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), at the time of your “separation from service,” as defined in those regulations. If this paragraph applies, then any units that otherwise would have been settled during the first six months following your separation from service will instead be settled during the seventh month following your separation from service, unless the settlement of those units is exempt from Section 409A of the Code. |
Nature of Units | Your units are mere bookkeeping entries. They represent only the Company’s unfunded and unsecured promise to issue shares of Common Stock on a future date. As a holder of units, you have no rights other than the rights of a general creditor of the Company. |
No Voting Rights or Dividends | Your units carry neither voting rights nor rights to cash dividends. You have no rights as a stockholder of the Company unless and until your units are settled by issuing shares of the Company’s Common Stock. |
Units Nontransferable | You may not sell, transfer, assign, pledge or otherwise dispose of any units. For instance, you may not use your units as security for a loan. |
Tax Obligations | (a) Withholding of Taxes. In the event that the Company or any Subsidiary determines that it is required to account to HM Revenue & Customs for any Award Tax Liability or Secondary NIC Liability arising from the grant, vesting, release, cancellation or any other disposal of this Award or arising out of the acquisition, retention and disposal of the Common Stock acquired pursuant to this Award, you, as a condition to the issue of units in connection with the vesting of an Award, or on the grant, release or cancellation of an Award, shall make such arrangements satisfactory to the Company to enable it or any Subsidiary to satisfy any requirement to account for any Award Tax Liability (and any Secondary NIC Liability) that may arise in connection with the Award or the issue of Common Stock pursuant to it including, but not limited to, arrangements satisfactory to the Company for withholding shares that would otherwise be issued. (b) Section 431 election. As a further condition of the vesting of the Award you shall have signed a Section 431 Election in the form set out in Attachment A or in such other form as may be determined by HM Revenue & Customs from time to time. |
(c) Secondary NIC Liability. As a further condition of the vesting of the Award you shall join with the Company and any other company who is or becomes a Secondary Contributor in making a Joint Election which has been approved by HM Revenue & Customs, for the transfer of the whole of any Secondary NIC Liability. | |
(d) Your Tax Indemnity. (i) Indemnity. To the extent permitted by law, you hereby agree to indemnify and keep indemnified the Company, and the Company as trustee for and on behalf of any related corporation, for any Award Tax Liability and Secondary NIC Liability. | |
(ii) No Obligation to Issue Shares. The Company shall not be obliged to allot or deliver any Common Stock or any interest in Common Stock pursuant to this Agreement unless and until you have paid to the Company such sum as is, in the opinion of the Company, sufficient to indemnify the Company in full against the Award Tax Liability and the Secondary NIC Liability, or you have made such other arrangement as in the opinion of the Company will ensure that the full amount of any Award Tax Liability and any Secondary NIC Liability will be recovered from you within such period as the Company may then determine. | |
(iii) Right of Retention. In the absence of any such other arrangement being made, the Company shall have the right to retain out of the aggregate number of shares to which the you would have otherwise been entitled under this Agreement, such number of shares as, in the opinion of the Company, will enable the Company to sell as agent for you (at the best price which can reasonably expect to be obtained at the time of the sale) and to pay over to the Company sufficient monies out of the net proceeds of sale, after deduction of all fees, commissions and expenses incurred in relation to such sale, to satisfy your liability under such indemnity. |
Data Protection | By entering into this Agreement, and as a condition of the grant of the units, you consent to the collection, use, and transfer of personal data, including but not limited to, name, home address and telephone number, date of birth, social insurance number, salary, nationality, job title, any stock, units or directorships held in the Company or any Subsidiary, details of all Restricted Share Units, options or other entitlement to Common Stock awarded, cancelled, exercised, vested, unvested, or outstanding in your favour (“Data”) to the full extent permitted by and in full compliance with applicable laws. You understand that the Company and its Subsidiaries hold Data about you for the purpose of managing and administering the Plan. You further understand that the Company and/or its Subsidiaries will transfer Data among themselves as necessary for the purposes of implementation, administration, and management of your participation in the Plan, and that the Company and/or its Subsidiary may each further transfer Data to any Data Recipients. You understand that these Data Recipients may be located in your country of residence or elsewhere, such as the United States. You authorize the Data Recipients to receive, possess, use, retain, and transfer Data in electronic or other form, for the purposes of implementing, administering, and managing your participation in the Plan, including any transfer of such Data, as may be required for the administration of the Plan and/or the subsequent holding of Shares on your behalf, to a broker or third party with whom the Shares acquired on exercise may be deposited. Where the transfer is to be to a destination outside the European Economic Area, the Company shall take reasonable steps to ensure that your Data continues to be adequately protected and securely held. You understand that you may, at any time, review the Data, request that any necessary amendments be made to it, or withdraw your consent herein in writing by contacting the Company. You further understand that withdrawing consent may affect your ability to participate in the Plan. |
Additional terms | You have no right to compensation or damages for any loss in respect of the Award where such loss arises (or is claimed to arise), in whole or in part, from the termination of your employment; or notice to terminate employment given by or to you. This exclusion of liability shall apply however termination of employment, or the giving of notice, is caused other than in a case where a competent tribunal or court, from which there can be no appeal (or which the relevant employing company has decided not to appeal), has found that the cessation of your employment amounted to unfair or constructive dismissal of you and however compensation or damages may be claimed. |
You have no right to compensation or damages for any loss in respect of the Award where such loss arises (or is claimed to arise), in whole or in part, from any company ceasing to be a Subsidiary of the Company; or the transfer of any business from a Subsidiary of the Company to any person which is not a Subsidiary of the Company. This exclusion of liability shall apply however the change of status of the relevant company, or the transfer of the relevant business, and however compensation or damages may be claimed. | |
Restrictions on Resale | You agree not to sell any shares at a time when applicable laws, Company policies or an agreement between the Company and its underwriters prohibit a sale. This restriction will apply as long as your Service continues and for such period of time after the termination of your Service as the Company may specify. |
Adjustments | In the event of a stock split, a stock dividend or a similar change in Company stock, the number of your units will be adjusted accordingly, as the Company may determine pursuant to the Plan. |
Effect of Merger | If the Company is a party to a merger, consolidation or reorganization, then your units will be subject to the applicable provision of the Plan, provided that any action taken must either (a) preserve the exemption of your units from Section 409A of the Code or (b) comply with Section 409A of the Code. |
Applicable Law | This Agreement will be interpreted and enforced under the laws of the State of Delaware (without regard to their choice-of-law provisions). The Joint Election and the Section 431 Election are governed by the laws of England and Wales. |
The Plan and Other Agreements | The text of the Plan is incorporated in this Agreement by reference. The Plan, this Agreement, the Notice of Restricted Stock Unit Award, the Joint Election and the Section 431 Election constitute the entire understanding between you and the Company regarding this award. Any prior agreements, commitments or negotiations concerning this award are superseded. This Agreement may be amended only by another written agreement between the parties. |
Definitions | The definitions contained in the Plan are hereby incorporated into this Agreement unless otherwise defined herein. |
1. | I have reviewed this annual report on Form 10-K of Alimera Sciences, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statements of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision; to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: March 3, 2017 | /s/ C. Daniel Myers | |||
C. Daniel Myers Chief Executive Officer (Principal Executive Officer) |
1. | I have reviewed this annual report on Form 10-K of Alimera Sciences, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statements of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision; to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: March 3, 2017 | /s/ Richard S. Eiswirth, Jr. | |||||
Richard S. Eiswirth, Jr. President and Chief Financial Officer (Principal Financial and Accounting Officer) |
(1) | The 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 Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant. |
Date: March 3, 2017 | /s/ C. Daniel Myers | |||||
C. Daniel Myers | ||||||
Chief Executive Officer (Principal Executive Officer) |
Date: March 3, 2017 | /s/ Richard S. Eiswirth, Jr. | |||||
Richard S. Eiswirth, Jr. | ||||||
President and Chief Financial Officer (Principal Financial and Accounting Officer) |
Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Mar. 01, 2017 |
Jun. 30, 2015 |
|
Document and Entity Information [Abstract] | |||
Entity Registrant Name | ALIMERA SCIENCES INC | ||
Entity Central Index Key | 0001267602 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2016 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 45,721,956 | ||
Entity Common Stock, Shares Outstanding | 64,862,904 |
Consolidated Balance Sheets (Parenthetical) - USD ($) |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 150,000,000 | 100,000,000 |
Common stock, shares issued | 64,862,904 | 45,005,833 |
Common stock, shares outstanding | 64,862,904 | 45,005,833 |
Series A convertible preferred stock | ||
Preferred stock, shares authorized | 1,300,000 | 1,300,000 |
Preferred stock, shares issued | 600,000 | 600,000 |
Preferred stock, shares outstanding | 600,000 | 600,000 |
Preferred stock, liquidation preference | $ 24,000,000 | $ 24,000,000 |
Series B convertible preferred stock | ||
Preferred stock, shares authorized | 8,417 | 8,417 |
Preferred stock, shares issued | 8,416.251 | 8,416.251 |
Preferred stock, shares outstanding | 8,416.251 | 8,416.251 |
Preferred stock, liquidation preference | $ 50,750,000 | $ 50,750,000 |
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (33,174) | $ (30,645) |
OTHER COMPREHENSIVE LOSS | ||
Foreign currency translation adjustments | (124) | (336) |
TOTAL OTHER COMPREHENSIVE LOSS | (124) | (336) |
COMPREHENSIVE LOSS | $ (33,298) | $ (30,981) |
Consolidated Statements of Changes in Stockholders' (Deficit) Equity - USD ($) $ in Thousands |
Total |
Common Stock Issued |
Common Stock |
Common Stock
Common Stock Issued
|
Preferred Stock
Series A Convertible Preferred Stock
|
Preferred Stock
Series B Convertible Preferred Stock
|
Additional Paid-In Capital |
Additional Paid-In Capital
Common Stock Issued
|
Common Stock Warrants |
Accumulated Deficit |
Accumulated Other Comprehensive Loss |
---|---|---|---|---|---|---|---|---|---|---|---|
BALANCE at Dec. 31, 2014 | $ 49,519 | $ 443 | $ 19,227 | $ 49,568 | $ 292,851 | $ 1,497 | $ (313,255) | $ (812) | |||
BALANCE (in shares) at Dec. 31, 2014 | 44,320,342 | 600,000 | 8,416.251 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Issuance of stock, net of issuance costs | $ 924 | $ 4 | $ 920 | ||||||||
Issuance of stock, net of issuance costs (in shares) | 341,239 | ||||||||||
Exercise of stock options | $ 571 | $ 3 | 568 | ||||||||
Exercise of stock options (in shares) | 344,252 | 344,252 | |||||||||
Modification of common stock warrants | $ 1,250 | 1,250 | |||||||||
Stock-based compensation | 5,037 | 5,037 | |||||||||
Net loss | (30,645) | (30,645) | |||||||||
Foreign currency translation adjustments | (336) | (336) | |||||||||
BALANCE at Dec. 31, 2015 | 26,320 | $ 450 | $ 19,227 | $ 49,568 | 299,376 | 2,747 | (343,900) | (1,148) | |||
BALANCE (in shares) at Dec. 31, 2015 | 45,005,833 | 600,000 | 8,416 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Issuance of stock, net of issuance costs | $ 26,422 | $ 197 | $ 26,225 | ||||||||
Issuance of stock, net of issuance costs (in shares) | 19,645,539 | ||||||||||
Exercise of stock options | $ 293 | $ 2 | 291 | ||||||||
Exercise of stock options (in shares) | 285,231 | 211,532 | |||||||||
Modification of common stock warrants | $ 590 | 590 | |||||||||
Issuance of common stock warrants | 370 | 370 | |||||||||
Stock-based compensation | 4,889 | 4,889 | |||||||||
Net loss | (33,174) | (33,174) | |||||||||
Foreign currency translation adjustments | (124) | (124) | |||||||||
BALANCE at Dec. 31, 2016 | $ 25,586 | $ 649 | $ 19,227 | $ 49,568 | $ 330,781 | $ 3,707 | $ (377,074) | $ (1,272) | |||
BALANCE (in shares) at Dec. 31, 2016 | 64,862,904 | 600,000 | 8,416 |
Nature of Operations |
12 Months Ended |
---|---|
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF OPERATIONS | NATURE OF OPERATIONS Alimera Sciences, Inc., together with its wholly-owned subsidiaries, (the Company) is a pharmaceutical company that specializes in the commercialization, research and development of ophthalmic pharmaceuticals. The Company was formed on June 4, 2003 under the laws of the State of Delaware. The Company is presently focused on diseases affecting the back of the eye, or retina, because the Company’s management believes these diseases are not well treated with current therapies and represent a significant market opportunity. The Company’s only commercial product is ILUVIEN®, which has received marketing authorization in the United States (U.S.), Austria, Belgium, the Czech Republic, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Norway, Poland, Portugal, Spain, Sweden and the United Kingdom. In the U.S., ILUVIEN is indicated for the treatment of diabetic macular edema (DME) in patients who have been previously treated with a course of corticosteroids and did not have a clinically significant rise in intraocular pressure (IOP). In the European Economic Area (EEA) countries in which ILUVIEN has received marketing authorization, it is indicated for the treatment of vision impairment associated with DME considered insufficiently responsive to available therapies. As part of the approval process in Europe, the Company committed to conduct a five-year, post-authorization, open label registry study in 800 patients treated with ILUVIEN. In the fourth quarter of 2016, the Company requested approval to modify its protocol to cap enrollment in the study due to its post market safety surveillance not showing any unexpected safety signals. Although the Company has not received formal regulatory approval, the Medicines & Healthcare products Regulatory Agency (MHRA) has agreed to allow the Company to suspend enrollment, pending approval of the Company’s protocol amendment. As of December 31, 2016, 548 patients were enrolled in this study. The Company launched ILUVIEN in Germany and the United Kingdom in the second quarter of 2013 and in the U.S. and Portugal in the first quarter of 2015. In addition, the Company has entered into various agreements under which distributors will provide regulatory, reimbursement or sales and marketing support for future commercialization of ILUVIEN in numerous countries in the Middle East, Italy, Australia, New Zealand and Canada. |
Summary of Significant Accounting Policies |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates in Financial Statements — The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and, as such, include amounts based on informed estimates and judgments of management. Actual results could differ from those estimates. Principles of Consolidation — The consolidated financial statements include the accounts of Alimera Sciences, Inc. and all wholly-owned subsidiaries. All significant inter-company balances have been eliminated in consolidation. Cash, Cash Equivalents and Restricted Cash — Cash and cash equivalents include cash and highly liquid investments that are readily convertible into cash and have a maturity of 90 days or less when purchased. Generally, cash and cash equivalents held at financial institutions are in excess of federally insured limits. The Company limits its exposure to credit loss by placing its cash and cash equivalents in highly liquid investments with high quality financial institutions. Cash and cash equivalents were $30,979,000 and $31,075,000 as of December 31, 2016 and 2015, respectively, with approximately 92.0% and 90.0% of these balances, respectively held in U.S. based financial institutions. In addition, the Company has certain credit arrangements that require the Company to maintain minimum balances in specific bank accounts as collateral which are recorded as restricted cash. Revenue Recognition — The Company recognizes revenue from its product sales when persuasive evidence of an arrangement exists, title to product and associated risk of loss have passed to the customer, the price is fixed or determinable, and collection from the customer is reasonably assured. Title passes generally upon shipment or upon receipt by the customer depending on the agreement with the customer. Precise information regarding the receipt of product by the customer is not always readily available. In these cases, the Company estimates the date of receipt based upon shipping policies by geographic location. The Company’s shipping policies require delivery within 24 hours of shipment in most instances. Taxes that are collected from customers and remitted to governmental authorities are not included in revenue. In the U.S., the Company sells ILUVIEN to a limited number of pharmaceutical distributors who in turn sell the product downstream to pharmacies and physician practices. Revenue from U.S. product sales is recorded upon sale to the pharmaceutical distributors net of applicable provisions for rebates and chargebacks under governmental programs, distribution-related fees and other sales-related deductions. Calculating these provisions involves management’s estimates and judgments. The Company reviews its estimates of rebates, chargebacks and other applicable provisions each period and records any necessary adjustments in the current period’s net product sales. The Company estimates reductions to product sales for Medicaid and Veterans’ Administration (VA) programs and for certain other qualifying federal and state government programs. Based upon the Company’s contracts with government agencies, statutorily-defined discounts applicable to government-funded programs, historical experience and estimated payer mix, the Company estimates and records an allowance for rebates and chargebacks. The Company’s liability for Medicaid rebates consists of estimates for claims that a state will make for a current quarter, claims for prior quarters that have been estimated for which an invoice has not been received and invoices received for claims from prior quarters that have not been paid. The Company’s reserves related to discounted pricing to VA, Public Health Services and other institutions (collectively qualified healthcare providers) represent the Company’s estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices the Company charges to its customers (i.e., pharmaceutical distributors). The Company’s customers charge the Company for the difference between what they pay for the products and the ultimate selling price to the qualified healthcare providers. The Company’s reserve for this discounted pricing is based on expected sales to qualified healthcare providers and the historical chargebacks that customers have already claimed. The Company has written contracts with its customers that include terms for distribution-related fees. The Company estimates and records distribution and related fees due to its customers based on gross sales. Consistent with industry practice, the Company offers its customers a limited right to return product purchased directly from the Company, which is principally based upon the product’s expiration date. The Company will accept returns for three months prior to and up to nine months after the product expiration date. Depending on the circumstances, the Company may provide replacement products or cash credit for returns. Product returned is generally not resalable given the nature of the Company’s products and method of administration. The Company develops estimates for product returns based upon historical experience, inventory levels, shelf life of the product and other relevant factors. The Company monitors product supply levels in the distribution channel, as well as sales by its customers to healthcare providers using product-specific data provided by its customers. If necessary, the Company’s estimates of product returns may be adjusted in the future based on actual returns experience, known or expected changes in the marketplace, or other factors. Accounts Receivable and Allowance for Doubtful Accounts — Accounts receivable are generated through sales primarily to pharmacies, hospitals and wholesalers which began in 2013. The Company does not require collateral from its customers for accounts receivable. The carrying amount of accounts receivable is reduced by an allowance for doubtful accounts that reflects management’s best estimate of the amounts that will not be collected. In addition to reviewing delinquent accounts receivable, management considers many factors in estimating its general allowance, including historical data, experience, customer types, credit worthiness and economic trends. From time to time, management may adjust its assumptions for anticipated changes in any of those or other factors expected to affect collectability. Provisions for doubtful accounts are charged to operations at the time management determines these accounts may become uncollectable. The Company writes off accounts receivable when management determines they are uncollectable and credits payments subsequently received on such receivables to bad debt expense in the period received. The following summarizes activity related to the Company’s allowance for doubtful accounts:
Inventory — Inventories are stated at the lower of cost or market with cost determined under the first in, first out (FIFO) method. Included in inventory costs are component parts, work-in-progress and finished goods. The Company relies on third party manufacturers for the production of all inventory and does not capitalize any internal costs. The Company periodically reviews inventories for excess, obsolete or expiring inventory and writes down obsolete or otherwise unmarketable inventory to its estimated net realizable value. If the actual net realizable value is less than that estimated, or if there are any further determinations that inventory will not be marketable based on estimates of demand, additional inventory write-downs will be required. Intangible Assets — The cost of intangible assets with determinable useful lives is amortized to reflect the pattern of economic benefits consumed, which approximates a straight-line basis, over the estimated periods benefited. The estimated useful life of the intangible asset is approximately thirteen years. Property and Equipment — Property and equipment are stated at cost. Additions and improvements are capitalized while repairs and maintenance are expensed. Depreciation is provided on the straight-line method over the useful life of the related assets beginning when the asset is placed in service. The estimated useful lives of the individual assets are as follows: furniture, fixtures and manufacturing equipment, five years; automobiles, four years; office equipment and leasehold improvements, 29 months to five years; and software, three years. Impairment — Property and equipment and intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When indicators of impairment are present, the Company evaluates the carrying amount of such assets in relation to the operating performance and future estimated undiscounted net cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. The assessment of the recoverability of assets will be impacted if estimated future operating cash flows are not achieved. Income Taxes — In accordance with the Financial Accounting Standards Board (FASB) Accounting Standard Codification (ASC) 740, Income Taxes, the Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of its assets and liabilities. The Company records a valuation allowance against its net deferred tax asset to reduce the net carrying value to an amount that is more likely than not to be realized. Income tax positions are considered for uncertainty in accordance with ASC 740-10. The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material change to its financial position; therefore, no ASC 740-10 liabilities for uncertain tax positions have been recorded. The Company will recognize accrued interest and penalties related to unrecognized tax benefits, if any, as interest expense and income tax expense, respectively, in the consolidated statements of operations. Significant management judgment is involved in determining the provision for income taxes, deferred tax assets and liabilities, and any valuation allowance recorded against net deferred tax assets. Due to uncertainties with respect to the realization of deferred tax assets as a result of the Company’s history of operating losses, a valuation allowance has been established against the net deferred tax asset balance in the U.S. The valuation allowance is based on management’s estimates of taxable income in the jurisdictions in which the Company operates and the period over which deferred tax assets will be recoverable. In the event that actual results differ from these estimates or the Company adjusts these estimates in future periods, a change in the valuation allowance may be needed, which could materially impact the Company’s financial position and results of operations. Research and Development Costs — Research and development costs are expensed as incurred. Research and development expenses were $2,146,000 and $2,395,000 for the years ended December 31, 2016 and 2015, respectively. Stock-Based Compensation — The Company has stock option plans which provide for grants of stock options to employees and directors to purchase shares of the Company’s common stock at exercise prices generally equal to the fair market values of such stock at the dates of grant. Compensation cost is recognized for all share-based awards based on the grant date fair value in accordance with the provisions of ASC 718, Compensation — Stock Compensation. The fair values for the options are estimated at the dates of grant using a Black-Scholes option-pricing model. Additionally, the Company sponsors an employee stock purchase plan (ESPP) under which employees may elect payroll withholdings to fund purchases of the Company’s stock at a discount. The Company estimates the fair value of the option to purchase shares of the Company’s common stock using the Black-Scholes valuation model and recognizes compensation expense in accordance with the provisions of ASC 718-50, Employee Share Purchase Plans. Derivative Financial Instruments — The Company generally does not use derivative instruments to hedge exposures to cash flow or market risks. However, certain warrants to purchase Series A Convertible Preferred Stock or common stock that do not meet the requirements for classification as equity, in accordance with the Derivatives and Hedging Topic of the ASC, are classified as liabilities. In such instances, net-cash settlement is assumed for financial reporting purposes, even when the terms of the underlying contracts do not provide for a net-cash settlement. These warrants were considered derivative instruments at issuance because the agreements provide for settlement in Series A Convertible Preferred Shares or common shares at the option of the holder, an adjustment to the warrant exercise price for common shares at some point in the future and contain anti-dilution provisions whereby the number of shares for which the warrants are exercisable and/or the exercise price of the warrants are subject to change in the event of certain issuances of stock at prices below the then-effective exercise price of the warrants. The warrant exercise price no longer can be adjusted at some point in the future. The primary underlying risk exposure pertaining to the warrants is the change in fair value of the underlying common stock. Such financial instruments are initially recorded at fair value with subsequent changes in fair value recorded as a component of change in fair value of derivative warrant liability in the consolidated statements of operations in each reporting period. If these instruments subsequently meet the requirements for equity classification, the Company reclassifies the fair value to equity. As of December 31, 2016 and 2015, these warrants represented the only outstanding derivative instruments issued or held by the Company. Fair Value of Financial Instruments — The carrying amounts of the Company’s financial instruments, including cash and cash equivalents and current assets and liabilities approximate their fair value because of their short maturities. The weighted average interest rate of the Company’s notes payable approximates the rate at which the Company could obtain alternative financing; therefore, the carrying amount of the note approximates the fair value. The Company uses the Black-Scholes option pricing model and assumptions that consider, among other variables, the fair value of the underlying stock, risk-free interest rate, volatility, expected life and dividend rates in estimating fair value for the warrants considered to be derivative instruments. Translation Policy - The U.S. dollar is the functional currency for Alimera Sciences, Inc. The Euro is the functional currency for the majority of the Company’s subsidiaries operating outside of the U.S. For Alimera Sciences, Inc., foreign currency assets and liabilities are remeasured into U.S. dollars at end-of-period exchange rates, except for non-monetary balance sheet accounts, which are remeasured at historical exchange rates. Revenue and expenses are remeasured at average exchange rates in effect during each period, except for those expenses related to the non-monetary balance sheet amounts, which are remeasured at historical exchange rates. Gains or losses from foreign currency remeasurements are included in the statement of operations. The financial statements of the foreign subsidiaries whose functional currency is not the U.S. dollar, have been translated into U.S. dollars in accordance with ASC 830-30, Translation of Financial Statements. For the subsidiaries operating outside of the U.S. that are denominated in the Euro, assets and liabilities are translated at end-of-period rates while revenues and expenses are translated at average rates in effect during the period in which the activity took place. Equity is translated at historical rates and the resulting cumulative translation adjustments are included as a component of accumulated other comprehensive loss. Earnings Per Share (EPS) — Basic EPS is calculated in accordance with ASC 260, Earnings per Share by dividing net income or loss attributable to common stockholders by the weighted average common stock outstanding. Diluted EPS is calculated in accordance with ASC 260 by adjusting weighted average common shares outstanding for the dilutive effect of common stock options, warrants, convertible preferred stock and accrued but unpaid convertible preferred stock dividends. In periods where a net loss is recorded, no effect is given to potentially dilutive securities, since the effect would be anti-dilutive. Common stock equivalent securities that would potentially dilute basic EPS in the future, but were not included in the computation of diluted EPS because to do so would have been anti-dilutive, were as follows:
Reporting Segments — The Company determines operating segments in accordance with its internal operating structure. The Company’s chief operating decision maker is the Chief Executive Officer (CEO). While the CEO is apprised of a variety of financial metrics and information, the business is principally managed and organized based upon geographic and regulatory environment. Each segment is separately managed and is evaluated primarily upon net loss from operations. The Company does not report balance sheet information by segment since it is not reviewed by the Company’s chief operating decision maker. The Company has two reportable segments, U.S. and International. Promotional and Advertising Costs — Promotional and advertising costs are expensed as incurred. Adoption of New Accounting Standards — In June 2014, the FASB issued Accounting Standards Update (ASU) 2014-12, Compensation Stock - Compensation (Topic 718). ASU 2014-12 applies to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. It requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition and follows existing accounting guidance for the treatment of performance conditions. The standard was effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. The adoption of this guidance did not have a material impact on its financial statements. In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014-15 requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued and provides guidance on determining when and how to disclose going concern uncertainties in the financial statements. ASU 2014-15 applies to all entities and is effective for annual and interim reporting periods ending after December 15, 2016, with early adoption permitted. The adoption of this guidance did not have a material impact on its financial statements. In April 2015, the Financial Accounting Standards Board (FASB) issued ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. ASU 2015-03 is intended to simplify the presentation of debt issuance costs. These amendments require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted and the standard is to be retrospectively applied to all periods presented upon adoption. The Company elected to early adopt ASU 2015-03 effective December 31, 2015, and as a result the Company reclassified $629,000 from deferred financing costs to note payable in its Consolidated Balance Sheet as of December 31, 2015. In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes, which simplifies the presentation of deferred income taxes. This ASU requires that deferred tax assets and liabilities be classified as non-current in a statement of financial position. The Company elected to early adopt ASU 2015-17 effective December 31, 2015 on a prospective basis. Adoption of this ASU resulted in a reclassification of our net current deferred tax asset to the net non-current deferred tax asset in its Consolidated Balance Sheet as of December 31, 2015. Accounting Standards Issued but Not Yet Effective — In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), as subsequently amended. ASU 2014-09 provides a single, comprehensive revenue recognition model for all contracts with customers. The revenue guidance contains principles that an entity will apply to determine the measurement of revenue and timing of when it is recognized. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The standard is effective for the first interim period within annual reporting periods beginning after December 15, 2017 for public entities, with early adoption permitted in the annual reporting period beginning after December 15, 2016. The Company has begun its evaluation of the new guidance on its business and, at this time, do not believe there will be a material impact on the Company’s current direct product sales in international markets. For the U.S. business, the Company continues to evaluate the variable consideration provisions of the new guidance and the impact it will have specifically on the Company’s gross to net revenue adjustments, including chargebacks and rebates. The Company anticipates adopting the new revenue standard using the modified retrospective transition method. In July 2015, FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. This update requires entities to measure inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. This ASU is effective for annual reporting periods beginning after December 15, 2016 and interim periods within those years. The Company does not expect the impact of the adoption to have a material effect on its financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This standard requires all leases with durations greater than twelve months to be recognized on the balance sheet and is effective for interim and annual reporting periods beginning after December 15, 2018, although early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption on its financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation—Stock Compensation (Topic 718). This standard makes several modifications to Topic 718 related to the accounting for forfeitures, employer tax withholding on share-based compensation and the financial statement presentation of excess tax benefits or deficiencies. ASU 2016-09 also clarifies the statement of cash flows presentation for certain components of share-based awards. The standard is effective for interim and annual reporting periods beginning after December 15, 2016, although early adoption is permitted. The Company does not expect the impact of the adoption to have a material effect on its financial statements. |
Going Concern |
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Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GOING CONCERN | GOING CONCERN The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. To date the Company has incurred recurring losses, negative cash flow from operations and has accumulated a deficit of $377,074,000 from the Company’s inception through December 31, 2016. As of December 31, 2016, the Company had approximately $30,979,000 in cash and cash equivalents. The Company's ability to achieve profitability and positive cash flow is dependent upon its ability to increase revenue and contain its expenses. Further, the Company must maintain compliance with the debt covenants of its debt agreement (see Note 9). In 2016, in order to continue to fund its operations and meet its debt covenants, the Company raised additional equity and amended its debt agreement. In management’s opinion, the uncertainty regarding future revenues raises substantial doubt about the Company’s ability to continue as a going concern without access to additional debt or equity financing, over the course of the next twelve months. In order to meet the Company’s working capital needs through the next twelve months and maintain compliance with its debt covenants, the Company may need to raise additional debt or equity financing. The Company may be able to access capital under the Company’s current at-the-market offering facility, which has approximately $22,000,000 of remaining availability. The Company implemented a cost savings program in late 2016 that the Company believes will help decrease our cash burn over the next twelve months. While the Company has historically been able to raise additional capital through issuance of equity and/or debt financing, and while the Company has a plan in place to reduce spending in order to satisfy its obligations due within one year from the date of issuance of these financial statements, there can be no guarantees on the Company’s ability to maintain debt compliance, raise additional equity, or successfully implement its cost reduction plans. Accordingly, there is substantial doubt about the Company’s ability to continue as a going concern within one year after these financial statements are issued. |
Inventory |
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Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVENTORY | INVENTORY Inventory consisted of the following:
(1) Component parts inventory consisted of manufactured components of the ILUVIEN applicator. (2) Work-in-process consisted of completed units of ILUVIEN that are undergoing, but have not completed, quality assurance testing as required by U.S. or EEA regulatory authorities. |
Property and Equipment |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT Property and equipment consisted of the following:
Depreciation and amortization expense associated with property and equipment totaled $822,000 and $614,000 for the years ended December 31, 2016 and 2015, respectively. |
Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||
INTANGIBLE ASSETS | INTANGIBLE ASSETS As a result of the U.S. Food and Drug Administration’s (FDA) approval of ILUVIEN in September 2014, the Company was required to pay pSivida US, Inc. (pSivida) a milestone payment of $25,000,000 (the pSivida Milestone Payment) in October 2014 (see Note 8). The gross carrying amount of the intangible asset is $25,000,000, which is being amortized over approximately 13 years from the acquisition date. The net book value of the intangible asset was $20,604,000 and $22,549,000 as of December 31, 2016 and 2015, respectively, and amortization expense was $1,946,000 and $1,940,000 for the years ended December 31, 2016 and 2015, respectively. The estimated remaining amortization as of December 31, 2016 is as follows (in thousands):
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Accrued Expenses |
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Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCRUED EXPENSES | ACCRUED EXPENSES Accrued expenses consisted of the following:
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License Agreements |
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Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
LICENSE AGREEMENTS | LICENSE AGREEMENTS The Company entered into an agreement with pSivida for the use of fluocinolone acetonide (FAc) in pSivida’s proprietary delivery device in February 2005 with a subsequent amendment in 2008. pSivida is a global drug delivery company committed to the biomedical sector and the development of drug delivery products. The agreement with pSivida provides the Company with a worldwide exclusive license to develop and sell ILUVIEN. The Company’s license rights to pSivida’s proprietary delivery device could revert to pSivida if the Company were to (i) fail twice to cure its breach of an obligation to make certain payments to pSivida following receipt of written notice thereof; (ii) fail to cure other breaches of material terms of its agreement with pSivida within 30 days after notice of such breaches or such longer period (up to 90 days) as may be reasonably necessary if the breach cannot be cured within such 30-day period; (iii) file for protection under the bankruptcy laws, make an assignment for the benefit of creditors, appoint or suffer appointment of a receiver or trustee over its property, file a petition under any bankruptcy or insolvency act or have any such petition filed against it and such proceeding remains undismissed or unstayed for a period of more than 60 days; or (iv) notify pSivida in writing of its decision to abandon its license with respect to a certain product using pSivida’s proprietary delivery device. The Company was not in breach of its agreement with pSivida as of December 31, 2016. The Company must share 20% of net profits, determined on a cash basis and 33% of any lump sum milestone payments received from a sub-licensee of ILUVIEN, as defined by the agreement, with pSivida. In connection with this arrangement the Company is entitled to recover 20% of commercialization costs of ILUVIEN, as defined in the agreement, incurred prior to product profitability out of pSivida’s share of net profits, which is recovered as a reduction of future royalty payments. As of December 31, 2016 and 2015, the Company could offset future royalty payments to pSivida in the amounts of $25,828,000 and $21,565,000, respectively, due to the accumulation of commercialization costs. Due to the uncertainty of future net profits, the Company has fully reserved these amounts in the accompanying consolidated financial statements. As a result of the FDA’s approval of ILUVIEN in September 2014, the Company paid pSivida a milestone payment of $25,000,000 in October 2014. As of December 31, 2016 the Company owed pSivida approximately $240,000 for their portion of net profits on a cash basis, as defined in the amended and restated agreement, from the fourth quarter of 2016. In the second quarter of 2016, pSivida disputed portions of the Company’s claimed commercialization costs for the year ended December 31, 2014. As part of this dispute, pSivida notified the Company that it disagreed with $1,290,000 of the $12,956,000 in commercialization costs receivable that the Company had reported as of December 31, 2014 and claimed incremental profit sharing payments of $136,000 for the year ended December 31, 2014. The Company is disputing pSivida’s assertions using the alternative dispute resolution mechanism under the pSivida Agreement. If pSivida’s assertions were to prevail in the alternative dispute resolution mechanism and their assertions were then applied to the commercialization cost calculations for the years ended December 31, 2016 and 2015, then the Company believes the commercialization costs receivable from pSivida would be reduced from $25,828,000 to $21,201,000 as of December 31, 2016 and from $21,565,000 to $18,504,000 as of December 31, 2015 and the impact on the statements of operations for the years ended December 31, 2016 and 2015 would be immaterial. |
Loan Agreements |
12 Months Ended |
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Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
LOAN AGREEMENTS | LOAN AGREEMENTS Hercules Loan Agreement 2014 Loan Agreement In April 2014, Alimera Sciences Limited (Limited), a subsidiary of the Company, entered into a loan and security agreement (2014 Loan Agreement) with Hercules Capital, Inc. (Hercules) providing for a term loan of up to $35,000,000 (2014 Term Loan), which Limited and Hercules amended in November 2015 (the First Loan Amendment), March 2016 (the Second Loan Amendment), May 2016 (the Third Loan Amendment) and October 2016 (the Fourth Loan Amendment and, collectively with the 2014 Loan Agreement, the First Loan Amendment, the Second Loan Amendment and the Third Loan Amendment, the Term Loan Agreement). Under the 2014 Loan Agreement, Hercules made an advance in the initial principal amount of $10,000,000 to Limited at closing to provide Limited with additional working capital for general corporate purposes and to repay a 2013 term loan with Silicon Valley Bank. Hercules made an additional advance of $25,000,000 to Limited in September 2014, following the approval of ILUVIEN by the FDA to fund the pSivida Milestone Payment. The 2014 Loan Agreement provided for interest only payments through November 2015. Interest on the 2014 Term Loan accrued at a floating per annum rate equal to the greater of (i) 10.90%, or (ii) the sum of (A) 7.65%, plus (B) the prime rate. Following the interest only period the 2014 Term Loan was due and payable to Hercules in equal monthly payments of principal and interest through May 1, 2018. The interest rate on the Term Loan Agreement was 11.25% as of December 31, 2016. First Loan Amendment In November 2015, Limited and Hercules amended the 2014 Loan Agreement to extend the interest only payments through May 2017. In connection with the First Loan Amendment, Limited paid to Hercules an amendment fee of $262,500 and agreed to make an additional payment of $1,050,000, equal to 3% of the 2014 Term Loan at the time of the final payment (End of Term Payment). Limited and the Company, on a consolidated basis with the Company’s other subsidiaries (the Consolidated Group), agreed to customary affirmative and negative covenants and events of default in connection with these arrangements. The occurrence of an event of default could result in the acceleration of Limited’s obligations under the Term Loan Agreement and an increase to the applicable interest rate and would permit Hercules to exercise remedies with respect to the collateral under the Term Loan Agreement. In connection with the First Loan Amendment, Limited agreed to covenants regarding certain revenue thresholds and a liquidity threshold. Second Loan Amendment In January 2016, the revenue threshold covenant was not met by the Consolidated Group and as a result, in March 2016, Limited and Hercules entered into the Second Loan Amendment, which further amended certain terms of the 2014 Loan Agreement. In conjunction with the Second Loan Amendment, Hercules waived this covenant violation. The Second Loan Amendment adjusted the revenue covenant to a rolling three-month calculation, first measured for the three months ended May 31, 2016. In addition, the Second Loan Amendment increased the liquidity covenant. Upon execution of the Second Loan Amendment, Limited paid Hercules an amendment fee of $350,000 and agreed to increase the End of Term Payment to $1,400,000 from $1,050,000, which is payable in May 2018. The Company concluded that the Second Loan Amendment resulted in a substantial modification of the terms of debt when considered with the First Loan Amendment in accordance with the guidance in ASC 470-50, Debt. As a result, the Company accounted for the Second Loan Amendment as an extinguishment and recognized a loss on early extinguishment of debt of approximately $2,564,000 within the consolidated statement of operations for the year ended December 31, 2016. The loss on early extinguishment consisted primarily of the unamortized debt discount associated with the warrant and debt issuance costs incurred prior to the Second Loan Amendment, the incremental fair value of the warrant as a result of modifying the terms of the warrant and the debt issuance costs of $360,000 paid to Hercules for the Second Loan Amendment. Third Loan Amendment and July 2016 Waiver In May 2016, Limited and Hercules entered into the Third Loan Amendment to expand the definition of liquidity to allow for the inclusion of cash of up to $2,000,000 in bank accounts outside of the U.S. and the United Kingdom. In July 2016, Limited obtained a waiver of the requirements of the liquidity covenant (the Waiver) because the Consolidated Group was not in compliance with the liquidity covenant as of June 30, 2016. The Waiver cured the default of the liquidity covenant then existing under the Term Loan Agreement and decreased the liquidity requirement. In addition, the Waiver modified the three-month revenue covenant so that it was not measured at July 31, 2016 and reduced the three-month revenue target to be measured at August 31, 2016. Following execution of the Waiver, Limited incurred a weekly ticking fee equal to 0.05% multiplied by the outstanding principal amount through the closing of the Company’s public offering in August 2016 (see Note 12 Common Stock), totaling $65,000. Further, Limited paid Hercules a fee of $350,000 associated with the Waiver. Fourth Loan Amendment In October 2016, Limited entered into the Fourth Loan Amendment with Hercules, which further amended certain terms of the Term Loan Agreement. Pursuant to the terms of the Fourth Loan Amendment, Hercules agreed to provide up to an additional $10,000,000 to Limited with (i) the first $5,000,000 available at Limited’s option through June 30, 2017 subject to (A) the Consolidated Group’s achievement of $12,000,000 in trailing three month net product revenue and (B) no event of default having occurred since October 20, 2016 (the Effective Date) and (ii) the second $5,000,000 available at Limited’s option through December 31, 2017 subject to (A) the Consolidated Group’s achievement of $15,000,000 in trailing three month net product revenue, (B) no event of default having occurred since the Effective Date and (C) the prior $5,000,000 having been advanced to Limited (the Additional Advances and, together with the 2014 Term Loan, the Term Loan). The Fourth Loan Amendment provides for interest only payments through November 30, 2018 (the Interest-Only Period). Pursuant to the Fourth Loan Amendment, interest on the Term Loan accrues at a floating per annum rate equal the greater of (i) 11.0% and (ii) the sum of (A) 11.0% plus (B) the prime rate as reported in The Wall Street Journal, or if not reported, the prime rate most recently reported in The Wall Street Journal, minus 3.5%. In addition to the interest described above, the principal balance of the Term Loan will bear “payment-in kind” interest at the rate of 1.0% (PIK Interest), which PIK Interest will be added to the outstanding principal balance of the Term Loan so as to increase the outstanding principal balance of the Term Loan on each payment date for the Term Loan and which amount will be payable when the aggregate outstanding principal amount of the Term Loan is payable. The Term Loan will be due and payable to Hercules in 24 equal monthly payments of principal and interest following the Interest-Only Period beginning on December 1, 2018 and matures in full on November 1, 2020. Limited paid Hercules a facility charge of $337,500 and reimbursed Hercules for legal and diligence fees incurred in connection with the Fourth Loan Amendment. If Limited prepays the Term Loan, it will pay Hercules a prepayment penalty (i) if such amounts are prepaid in any of the first 12 months following the Effective Date, equal to 3.0% of the principal amount of the Term Loan being repaid, (ii) if such amounts are prepaid after 12 months but prior to 24 months following the Effective Date, equal to 2.0% of the principal amount of the Term Loan being repaid, and (iii) if such amounts are prepaid at any time thereafter, equal to 1.0% of the principal amount of the Term Loan being repaid. The Consolidated Group also agreed to customary affirmative and negative covenants, including, without limitation, covenants relating to minimum liquidity, minimum trailing six-month net revenue and adjusted EBITDA and events of default in connection with these arrangements. The occurrence of an event of default could result in the acceleration of Limited’s obligations under the Term Loan Agreement, as amended by the Fourth Loan Amendment and an increase to the applicable interest rate and would permit Hercules to exercise remedies with respect to the collateral under the Term Loan Agreement, as amended by the Fourth Loan Amendment. In the event that the Company maintains $35,000,000 in liquidity, including cash and eligible accounts receivable, at the end of the month and has not been and is not in breach of the amended debt facility, the six-month trailing revenue covenant is waived for such month. As of December 31, 2016, the Company’s liquidity as defined under the Term Loan Agreement was $40,923,000, which consisted of $30,979,000 in cash and cash equivalents and 80% of the Company’s $12,430,000 U.S. eligible accounts receivable. General Discussion of the Term Loan Agreement Pursuant to the Term Loan Agreement, Limited’s obligations to Hercules are secured by a first-priority security interest in substantially all of Limited’s assets, excluding intellectual property. Hercules does, however, maintain a negative pledge on Limited’s intellectual property requiring Hercules’ consent prior to the sale of such intellectual property. The Company and certain of the Company’s other subsidiaries are guarantors of the obligations of Limited to Hercules under the Term Loan Agreement pursuant to separate guaranty agreements between Hercules and each of Limited and such subsidiaries (Guaranties). Pursuant to the Guaranties, the Company and these subsidiaries granted Hercules a first-priority security interest in substantially all of their respective assets excluding intellectual property. The Term Loan Agreement also places limitations on the Company’s ability to declare or pay any dividend or distribution on any shares of capital stock. 2014 Warrant In connection with Limited entering into the 2014 Loan Agreement, the Company issued a warrant to Hercules to purchase up to 285,016 shares of the Company’s common stock at an exercise price of $6.14 per share (the 2014 Warrant). Sixty percent of the 2014 Warrant was exercisable at the closing in April 2014 and the remaining forty percent became exercisable upon the funding of the additional $25,000,000 to Limited in September 2014. The Company agreed to amend the 2014 Warrant in connection with the First Loan Amendment to increase the number of shares issuable upon exercise to 660,377 and decrease the exercise price to $2.65 per share. Upon entering into the Second Loan Amendment, the Company agreed to further amend the 2014 Warrant to increase the number of shares issuable upon exercise to 862,069 and decrease the exercise price to $2.03 per share. In connection with the July 2016 Waiver, the Company agreed to further amend the 2014 Warrant to increase the number of shares issuable upon exercise to 1,258,993 and decrease the exercise price to $1.39 per share. 2016 Warrant In connection with Limited entering into the Fourth Loan Amendment, the Company agreed to issue a new warrant to Hercules (the 2016 Warrant) to purchase up to 458,716 shares of the Company’s common stock at an exercise price of $1.09 per share, which was equal to $500,000 divided by the lowest volume-weighted average sale price for a share of the Company’s common stock reported over any ten consecutive trading days during the period commencing on and including September 23, 2016 and ending on the earlier to occur of (i) December 30, 2016 (inclusive of such date), and (ii) the second trading day immediately preceding the date of closing of a merger event (as defined in the 2016 Warrant). Fair Value of Debt The weighted average interest rates of the Company’s notes payable approximate the rate at which the Company could obtain alternative financing and the fair value of the warrants that were issued in connection with the Company’s notes payable are immaterial. Therefore, the carrying amount of the notes approximated their fair value at December 31, 2016 and 2015. |
Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Term Note Payable — The Company entered into the Term Loan Agreement in April 2014 and amended the agreement in November 2015, March 2016, May 2016 and October 2016 (Note 9). As of December 31, 2016 a schedule of future minimum principal payments, excluding PIK Interest and excluding the End of Term Payment of $1,400,000 which is payable in May 2018, under the Note Payable is as follows (in thousands):
As of December 31, 2016 and 2015, the Company had $336,000 and $333,000 accrued and unpaid interest payable on the Notes Payable, respectively. In addition, the Company is required to make an additional payment of $1,400,000 in May 2018. Operating Leases — The Company leases office space and equipment under non-cancelable agreements accounted for as operating leases. The leases generally require that the Company pay taxes, maintenance, and insurance. Management expects that in the normal course of business, leases that expire will be renewed or replaced by other leases. In August 2014, the Company signed a lease for office space in the U.S. through September 2021. In December 2014, Limited signed a lease for office space in the United Kingdom through December 24, 2024, however the lease is cancellable after December 17, 2019. The lease has a contingent escalation clause based on inflation beginning in 2020. The Company also leases office space in Germany and Portugal that expire in July 2018 and March 2020, respectively. The Company also leases office space in France, consisting of less than 1,000 square feet. As part of the Company's decision in 2016 to close operations in France, which will not be completed until early 2017, the Company gave notice to the leasing company that the Company would not be renewing the lease after April 2017. As of December 31, 2016, a schedule by year of future minimum payments under all of the Company’s operating leases is as follows:
Rent expense under all operating leases totaled approximately $544,000 and $541,000 for the years ended December 31, 2016 and 2015, respectively. Capital Leases — The Company leases equipment under capital leases. The property and equipment is capitalized at the lesser of fair market value or the present value of the minimum lease payments at the inception of the leases using the Company’s incremental borrowing rate. As of December 31, 2016, a schedule by year of future minimum payments under capital leases, together with the present value of minimum lease payments, is as follows (in thousands):
Property and equipment under capital leases, which are included in property and equipment (Note 5), consisted of the following:
Depreciation expense associated with property and equipment under capital leases was approximately $267,000 and $210,000 for the years ended December 31, 2016 and 2015, respectively. Significant Agreements — In February 2010, the Company entered into an agreement with a third party manufacturer for the manufacture of the ILUVIEN implant, the assembly of the ILUVIEN applicator and packaging of the completed ILUVIEN commercial product. The Company is responsible for supplying the ILUVIEN applicator and the active pharmaceutical ingredient. In accordance with the terms of the agreement, the Company must order at least 80% of the ILUVIEN units required in the U.S., Canada and the EEA from the third party manufacturer for an initial term of six years. The agreement has an initial six year term and will automatically renew for successive one year periods unless either party delivers written notice of non-renewal to the other at least 12 months prior to the end of the then current term. In February 2016, the Company amended and restated its agreement to extend the term to five years, at which point it will automatically renew for successive one year periods unless either party delivers notice of non-renewal to the other party at least 12 months prior to the end of the term or any renewal term. In May 2013, the Company entered into an agreement with the first of three contract research organizations (CROs) for clinical and data management services to be performed in connection with the five-year, post-authorization, open label registry study in 800 patients treated with ILUVIEN per the labeled indication in the EEA. Since May of 2013 nine additional agreements have been entered into for work with these CROs. For the years ended December 31, 2016 and 2015, the Company incurred $157,000 and $591,000, respectively, of expense associated with these agreements. As of December 31, 2016 and 2015, $76,000 and $150,000, respectively, is included in accrued expenses (Note 7). As of December 31, 2016, the Company expects to incur an additional $587,000 of expense associated with these agreements through December 31, 2019. In November 2012, the Company entered into a master services agreement with Quintiles Commercial Europe Limited. Under the agreement, Quintiles Commercial Europe Limited and its affiliates (collectively, Quintiles Commercial) provided certain services to us in relation to the commercialization of ILUVIEN, in France, Germany and the United Kingdom. In December 2013 and January 2014, respectively, the Company transitioned our German and United Kingdom country manager positions in-house. In April 2015, the Company terminated the project orders associated with France and Germany and transitioned the persons employed by Quintiles Commercial to our payroll. In July 2015, the Company terminated the remaining project orders associated with the United Kingdom and transitioned the persons employed by Quintiles Commercial to the Company’s payroll. For the year ended December 31, 2015, the Company incurred $1,030,000 of expense associated with this agreement. As of December 31, 2016 and 2015, $164,000 and $170,000, respectively, was included in accrued expenses. As of December 31, 2015 the master services agreement with Quintiles Commercial had been terminated and no expense was incurred during the year ended December 31, 2016. Employment Agreements — The Company is party to employment agreements with five executives. The agreements generally provide for annual salaries, bonuses, and benefits and for the “at-will” employment of such executives. Effective January 1, 2016, the Company is party to five agreements with salaries ranging from $253,000 to $519,000. If any of the agreements are terminated by the Company without cause, or by the employee for good reason, as defined in the agreements, the Company will be liable for one year of salary and benefits. Certain other employees have general employment contracts which include stipulations regarding confidentiality, Company property, severance in an event of change of control and miscellaneous items. |
Preferred Stock |
12 Months Ended |
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Dec. 31, 2016 | |
Equity [Abstract] | |
PREFERRED STOCK | PREFERRED STOCK Series A Convertible Preferred Stock On October 2, 2012, the Company closed its preferred stock financing in which it sold units consisting of 1,000,000 shares of Series A Convertible Preferred Stock and warrants to purchase 300,000 shares of Series A Convertible Preferred Stock for gross proceeds of $40,000,000, prior to the payment of approximately $560,000 of related issuance costs. The powers, preferences and rights of the Series A Convertible Preferred Stock are set forth in the certificate of designation filed by the Company with the Secretary of State of the State of Delaware on October 1, 2012. Each share of Series A Convertible Preferred Stock, including any shares of Series A Convertible Preferred Stock issued upon exercise of the warrants, is convertible into shares of the Company’s common stock at any time at the option of the holder at the rate equal to $40.00 divided by $2.66 (Conversion Price). The initial Conversion Price was subject to adjustment based on certain customary price based anti-dilution adjustments. These adjustment features lapsed in September 2014. Each share of Series A Convertible Preferred Stock shall automatically be converted into shares of common stock at the then-effective Conversion Price upon the occurrence of the later to occur of both (i) the Company receives and publicly announces the approval by the FDA of the Company’s NDA for ILUVIEN and (ii) the date on which the Company consummates an equity financing transaction pursuant to which the Company sells to one or more third party investors either (a) shares of common stock or (b) other equity securities that are convertible into shares of common stock and that have rights, preference or privileges, senior to or on a parity with, the Series A Convertible Preferred Stock, in each case having an as-converted per share of common stock price of not less than $10.00 and that results in total gross proceeds to the Company of at least $30,000,000. The rights and preferences of Series A Convertible Preferred Stock also place limitations on the Company’s ability to declare or pay any dividend or distribution on any shares of capital stock. Each unit sold in the preferred stock financing included a warrant to purchase 0.30 shares of Series A Convertible Preferred Stock at an exercise price equal to $44.00 per share. At the election of the holder of a warrant, the warrant may be exercised for the number of shares of common stock then issuable upon conversion of the Series A Convertible Preferred Stock that would otherwise be issued upon such exercise at the then-effective Conversion Price. These warrants are considered derivative instruments because the agreements provide for settlement in Series A Convertible Preferred Stock shares or common stock shares at the option of the holder, an adjustment to the warrant exercise price for common shares at some point in the future, and contain anti-dilution provisions whereby the number of shares for which the warrants are exercisable and/or the exercise price of the warrants was subject to change in the event of certain issuances of stock at prices below the then-effective exercise price of the warrants. Therefore, the warrants were recorded as a liability at issuance. These adjustment features lapsed in September 2014. As of December 31, 2016 and 2015 the fair market value of the warrants was estimated to be $188,000 and $2,815,000, respectively. The Company recorded gains of $2,627,000 and $13,283,000 as a result of the change in fair value of the warrants during the years ended December 31, 2016 and 2015, respectively. In April 2014, 2,255,639 shares of common stock were issued pursuant to the conversion of 150,000 shares of Series A Convertible Preferred Stock held by an investor. In September 2014, 3,759,398 shares of common stock were issued pursuant to the conversion of 250,000 shares of Series A Convertible Preferred Stock held by another investor. Series B Convertible Preferred Stock On December 12, 2014, the Company closed a preferred stock financing in which it sold 8,291.873 shares of Series B Convertible Preferred Stock for a purchase price of $6,030.00 per share, or an aggregate purchase price of $50,000,000, prior to the payment of approximately $432,000 of related issuance costs. The Company has also agreed to issue the purchasers an additional 124.378 shares of Series B Convertible Preferred Stock as a subscription premium. The powers, preferences and rights of the Series B Convertible Preferred Stock are set forth in the certificate of designation filed by the Company with the Secretary of State of the State of Delaware. Each share of Series B Convertible Preferred Stock is convertible into 1,000 shares of the Company’s common stock at any time at the option of the holder, provided that the holder will be prohibited from converting Series B Convertible Preferred Stock into shares of the Company’s common stock if, as a result of such conversion, the holder, together with its affiliates, would own more than 9.98% of the total number of shares of the Company’s common stock then issued and outstanding. The Series B Convertible Preferred Stock ranks junior to the Company’s existing Series A Convertible Preferred Stock, and senior to the Company’s common stock, with respect to rights upon liquidation. The Series B Convertible Preferred Stock ranks junior to all existing and future indebtedness. Except as otherwise required by law (or with respect to approval of certain actions), the Series B Convertible Preferred Stock will not have voting rights. The Series B Preferred Stock is not redeemable at the option of the holder. The Series B Convertible Preferred Stock is not subject to any price-based or other anti-dilution protections and does not provide for any accruing dividends. The Company determined that the conversion option of the Preferred Shares represented a beneficial conversion feature, as the conversion feature had intrinsic value to the holder on the commitment date as a result of the subscription premium. Therefore, the Company recorded a beneficial conversion feature of $750,000 during the year ended December 31, 2014 as an increase in additional paid in capital. Because the Series B Convertible Preferred Stock was immediately convertible into common stock at the option of the holder at issuance, the Company immediately accreted the full value of the beneficial conversion feature to the carrying value of the Series B Convertible Preferred Stock on that date. |
Stock Incentive Plans |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCK INCENTIVE PLANS | STOCK INCENTIVE PLANS The Company has stock option and stock incentive plans which provide for grants of shares to employees and grants of options to employees and directors to purchase shares of the Company’s common stock at exercise prices generally equal to the fair values of such stock at the dates of grant. Options granted to employees typically become exercisable over a four-year vesting period and have a ten-year contractual term. Initial options granted to directors typically vest over a four-year period and have a ten-year contractual term. Annual option grants to directors typically vest immediately and have a ten-year contractual term. Upon the exercise of stock options, the Company may issue the required shares out of authorized but unissued common stock or out of treasury stock at management’s discretion. A summary of stock option transactions under the plans are as follows:
The following table provides additional information related to outstanding stock options, fully vested stock options, and stock options expected to vest as of December 31, 2016:
The Company estimated the fair value of options granted using the Black-Scholes option pricing model. Use of a valuation model requires the Company to make certain assumptions with respect to selected model inputs. Changes in these input variables would affect the amount of expense associated with equity-based compensation. Expected volatility is based on the historical volatility of the Company’s common shares over the expected term of the stock option grant. To estimate the expected term, the Company utilizes the “simplified” method for “plain vanilla” options as discussed within the Securities and Exchange Commission’s Statement of Accounting Bulletin 107. The Company intends to utilize the simplified method for the foreseeable future until more detailed information about exercise behavior will be more widely available. The risk-free interest rate is based on U.S. Treasury Daily Treasury Yield Curve Rates corresponding to the expected life assumed at the date of grant. Dividend yield is zero as there are no payments of dividends made or expected. The weighted-average assumptions used for option grants were as follows:
Employee stock-based compensation expense related to stock options recognized in accordance with ASC 718 was as follows:
As of December 31, 2016, there was approximately $7,049,000 of total unrecognized compensation cost related to outstanding stock option awards that will be recognized over a weighted average period of 2.35 years. The total fair value of shares vested during the year ended December 31, 2016 was approximately $4,955,000. The total estimated fair value of options granted during the years ended December 31, 2016 and 2015 was $3,410,000 and $9,172,000, respectively. The total estimated intrinsic value of options exercised during the years ended December 31, 2016 and 2015 was $65,000 and $568,000, respectively. As of December 31, 2016, the Company was authorized to grant options to purchase up to an additional 668,830 shares under the 2010 Equity Incentive Plan. The Company’s 2010 Plan provides for annual increases in the number of shares available for issuance thereunder on the first day of each fiscal year equal to the lesser of: (1) 2,000,000 shares of our common stock; (2) 4% of the shares of common stock outstanding at that time; and (3) such other amount as our board of directors may determine. On January 1, 2017, an additional 2,000,000 shares became available for future issuance under the 2010 Plan. These additional shares from the annual increase under the 2010 Plan are not included in the foregoing discussion. |
Common Stock Warrants |
12 Months Ended |
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Dec. 31, 2016 | |
Equity [Abstract] | |
COMMON STOCK WARRANTS | COMMON STOCK WARRANTS The Company has issued warrants to purchase common stock to various members of the board of directors, third-parties for services, and lenders. Total warrants to purchase common stock issued and exercisable were 1,795,663 and 738,331 as of December 31, 2016 and 2015, respectively. As of December 31, 2016, the exercise prices ranged from $1.09 to $11.00 per share. The warrants are exercisable for a period between 5 and 10 years from the issuance date. In connection with Limited entering into the 2014 Loan Agreement (Note 9), the Company entered into the 2014 Warrant to purchase up to 285,016 shares of the Company’s common stock at an exercise price of $6.14 per share. Sixty percent of the warrants were exercisable at the closing in April 2014 and the remaining forty percent became exercisable upon the funding of the additional $25,000,000 to Limited in September 2014. The Company agreed to amend the 2014 Warrant in connection with the First Loan Amendment to increase the number of shares issuable upon exercise to 660,377 and decrease the exercise price to $2.65 per share. Upon entering into the Second Loan Amendment, the Company agreed to further amend the 2014 Warrant to increase the number of shares issuable upon exercise to 862,069 and decrease the exercise price to $2.03 per share. In connection with the July 2016 Waiver, the Company agreed to further amend the 2014 Warrant to increase the number of shares issuable upon exercise to 1,258,993 and decrease the exercise price to $1.39 per share. In connection with Limited entering into the Fourth Loan Amendment, the Company agreed to issue the 2016 Warrant to purchase up to 458,716 shares of the Company’s common stock at an exercise price of $1.09 per share, which was equal to $500,000 divided by the lowest volume-weighted average sale price for a share of the Company’s common stock reported over any ten consecutive trading days during the period commencing on and including September 23, 2016 and ending on the earlier to occur of (i) December 30, 2016 (inclusive of such date), and (ii) the second trading day immediately preceding the date of closing of a merger event (as defined in the 2016 Warrant). |
Concentrations and Credit Risk |
12 Months Ended |
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Dec. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS AND CREDIT RISK | CONCENTRATIONS AND CREDIT RISK For the years ended December 31, 2016 and 2015, there were only two customers within the U.S. segment. These two customers, which are large pharmaceutical distributors, accounted for approximately 75% and 68%, respectively, of the Company’s total consolidated revenues. These two same customers accounted for approximately 90% and 88% of the Company’s consolidated accounts receivable as of December 31, 2016 and 2015, respectively. For the years ended December 31, 2016 and 2015, there were no vendors that comprised more than 10% of the Company’s total purchases. The Company relies on a single manufacturer for ILUVIEN, a single manufacturer for the ILUVIEN applicator and a single active pharmaceutical ingredient manufacturer for ILUVIEN’s active pharmaceutical ingredient. |
Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES | INCOME TAXES The components of net loss before taxes are as follows:
In accordance with ASC 740, the Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of assets and liabilities at the enacted tax rates in effect for the year in which the differences are expected to reverse. The Company records a valuation allowance against the net deferred tax asset to reduce the net carrying value to an amount that is more likely than not to be realized. The provision for income taxes consists of the following components:
The following summarizes activity related to the Company’s valuation allowance:
Worldwide net deferred tax assets and liabilities are as follows:
A reconciliation from the federal statutory rate to the total provision for income taxes is as follows:
The change in permanent differences and other items from 2015 to 2016 is primarily due to the decreased benefit associated with the current period movement of the derivative warranty liability. However, as such current period movement creates an increased net operating loss in the United States which has a full valuation allowance recorded against its deferred tax assets, there is effectively no impact to total tax expense. Also included in the 2016 permanent differences is expense related to incentive stock options of approximately $517,000. A rollforward of the Company’s uncertain tax positions is as follows:
Included in the balance of unrecognized tax benefits as of December 31, 2016 and December 31, 2015 are approximately $59,000 and $46,000, respectively, of tax benefits related to research and development tax credits. In accordance with ASC 740-10, such attributes are reduced the amount that is expected to be recognized in the future. The Company does not accrue interest or penalties as there is no risk of additional tax liability due to significant NOLs available. The Company does not expect any decreases to the unrecognized tax benefits within the next twelve months due to any lapses in statute of limitations. Tax years from 2012 to 2015 remain subject to examination in California, Georgia, Kentucky, Tennessee, Texas and on the federal level, with the exception of the assessment of NOL carry-forwards available for utilization which can be examined for all years since 2003. The statute of limitations on these years will close when the NOLs expire or when the statute closes on the years in which the NOLs are utilized. Significant management judgment is involved in determining the provision for income taxes, deferred tax assets and liabilities, and any valuation allowance recorded against net deferred tax assets. Due to uncertainties with respect to the realization of deferred tax assets due to the history of operating losses, a valuation allowance has been established against the entire net deferred tax asset balance. The valuation allowance is based on management’s estimates of taxable income in the jurisdictions in which the Company operates and the period over which deferred tax assets will be recoverable. In the event that actual results differ from these estimates or the Company adjusts these estimates in future periods, a change in the valuation allowance may be needed, which could materially impact the Company’s financial position and results of operations. As of December 31, 2016 and 2015, the Company had federal net operating loss (NOL) carry-forwards of approximately $104,944,000 and $100,844,000 and state NOL carry-forwards of approximately $83,270,000, and $84,301,000 respectively, that are available to reduce future income unless otherwise taxable. If not utilized, the federal NOL carry-forwards will expire at various dates between 2029 and 2035 and the state NOL carry-forwards will expire at various dates between 2020 and 2035. NOL carry-forwards may be subject to annual limitations under Internal Revenue Code (IRC) Section 382 (Section 382) (or comparable provisions of state law) in the event that certain changes in ownership of the Company were to occur. The Company periodically evaluates its NOL carry-forwards and whether certain changes in ownership, including its Initial Public Offering (IPO), have occurred that would limit the Company’s ability to utilize a portion of its NOL carry-forwards. If it is determined that significant ownership changes have occurred since the Company generated its NOL carry-forwards, it may be subject to annual limitations on the use of these NOL carry-forwards under Section 382 (or comparable provisions of state law). The Company has determined that a Section 382 change in ownership occurred in late 2015. Therefore, the annual utilization of the Company’s NOLs are subject to certain limitations under Section 382 and other limitations under state tax laws. The Company is currently in the process of calculating these limitations. Any reduction to the Company’s NOL deferred tax asset due to the annual Section 382 limitation and the NOL carryforward period would result in an offsetting reduction in valuation allowance recorded against the NOL deferred tax asset. Therefore, any limitation would not have an impact on the statements of operations for the periods presented. The results of the analysis on the impact to the Company’s NOLs will be disclosed at a later date. As of December 31, 2016, the Company had cumulative book losses in foreign subsidiaries of approximately $92,939,000. The Company has not recorded a deferred tax asset for the excess of tax over book basis in the stock of its foreign subsidiaries. The Company anticipates that its foreign subsidiaries will be profitable and have earnings in the future. Once the foreign subsidiaries do have earnings, the Company intends to indefinitely reinvest in its foreign subsidiaries all undistributed earnings of and original investments in such subsidiaries. As a result, the Company does not expect to record deferred tax liabilities in the future related to excesses of book over tax basis in the stock of its foreign subsidiaries in accordance with ASC 740-30-25. |
Fair Value |
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FAIR VALUE | FAIR VALUE The Company applies ASC 820, Fair Value Measurements in determining the fair value of certain assets and liabilities. Under this standard, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date. In determining fair value, the Company uses various valuation approaches. The hierarchy of those valuation approaches is broken down into three levels based on the reliability of inputs as follows: Level 1 inputs are quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. The valuation under this approach does not entail a significant degree of judgment. Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include: quoted prices for similar assets or liabilities in active markets, inputs other than quoted prices that are observable for the asset or liability, (e.g., interest rates and yield curves observable at commonly quoted intervals or current market) and contractual prices for the underlying financial instrument, as well as other relevant economic measures. Level 3 inputs are unobservable inputs for the asset or liability. Unobservable inputs shall be used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. There have been no changes in the methodologies used as of December 31, 2016 and 2015. The following fair value table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis:
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Employee Benefit Plans |
12 Months Ended |
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Dec. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS The Company has a salary deferral 401(k) plan which covers substantially all U.S. employees of the Company. The Company matches participant contributions subject to certain plan limitations. Compensation expense associated with the Company’s matching plan totaled $287,000 and $268,000 for the years ended December 31, 2016 and 2015, respectively. The Company may also make an annual discretionary profit-sharing contribution. No such discretionary contributions were made during the years ended December 31, 2016 and 2015, respectively. In April 2010, the Company established an Employee Stock Purchase Plan (the Purchase Plan). Under the Company’s Purchase Plan, eligible employees can participate and purchase common stock semi-annually through accumulated payroll deductions. The Purchase Plan is administered by the Company’s board of directors or a committee appointed by the Company’s board of directors. Under the Purchase Plan eligible employees may purchase stock at 85% of the lower of the fair market value of a share of Common Stock on the offering date or the exercise date. The Purchase Plan provides for two six-month purchase periods generally starting on the first trading day on or after October 31 and April 30 of each year. Eligible employees may contribute up to 15% of their eligible compensation. A participant may purchase a maximum of 2,500 shares of common stock per purchase period. The value of the shares purchased in any calendar year may not exceed $25,000. The Purchase Plan was effective upon the completion of the Company’s IPO, at which time a total of 494,422 shares of the Company’s common stock were made available for sale. As of January 1 of each year, starting in 2011, the number of available shares will automatically be restored to the original level. A total of 82,760 and 72,261 shares of the Company’s common shares were acquired through the Purchase Plan during the years ended December 31, 2016 and 2015, respectively. As such, on January 1, 2017 and 2016, respectively, an additional 82,760 and 72,261 shares became available for future issuance under the Purchase Plan. In accordance with ASC 718-50, the ability to purchase stock at 85% of the lower of the fair market value of a share of Common Stock on the offering date or the exercise date represents an option. The Company estimates the fair value of such options at the inception of each offering period using the Black-Scholes valuation model. In connection with the Purchase Plan, the Company recorded $80,000 and $109,000 of compensation expense for the years ended December 31, 2016 and 2015, respectively. |
Segment Information |
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Segment Information | SEGMENT INFORMATION The following table presents a summary of the Company’s reporting segments for the years ended December 31, 2016 and 2015:
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Selected Quarterly Financial Data (Unaudited) |
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Selected Quarterly Financial Data (Unaudited) | SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) Selected quarterly financial data for years ended December 31, 2016 and 2015 are as follows (in thousands except per share data):
As a result of the Company’s weighted averages shares outstanding changing from quarter to quarter, the quarterly per share data will not necessarily add to the annual total. |
Summary of Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Use of Estimates in Financial Statements | Use of Estimates in Financial Statements — The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and, as such, include amounts based on informed estimates and judgments of management. Actual results could differ from those estimates. |
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Principles of Consolidation | Principles of Consolidation — The consolidated financial statements include the accounts of Alimera Sciences, Inc. and all wholly-owned subsidiaries. All significant inter-company balances have been eliminated in consolidation. |
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Cash and Cash Equivalents | Cash, Cash Equivalents and Restricted Cash — Cash and cash equivalents include cash and highly liquid investments that are readily convertible into cash and have a maturity of 90 days or less when purchased. Generally, cash and cash equivalents held at financial institutions are in excess of federally insured limits. The Company limits its exposure to credit loss by placing its cash and cash equivalents in highly liquid investments with high quality financial institutions. Cash and cash equivalents were $30,979,000 and $31,075,000 as of December 31, 2016 and 2015, respectively, with approximately 92.0% and 90.0% of these balances, respectively held in U.S. based financial institutions. In addition, the Company has certain credit arrangements that require the Company to maintain minimum balances in specific bank accounts as collateral which are recorded as restricted cash. |
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Revenue Recognition | Revenue Recognition — The Company recognizes revenue from its product sales when persuasive evidence of an arrangement exists, title to product and associated risk of loss have passed to the customer, the price is fixed or determinable, and collection from the customer is reasonably assured. Title passes generally upon shipment or upon receipt by the customer depending on the agreement with the customer. Precise information regarding the receipt of product by the customer is not always readily available. In these cases, the Company estimates the date of receipt based upon shipping policies by geographic location. The Company’s shipping policies require delivery within 24 hours of shipment in most instances. Taxes that are collected from customers and remitted to governmental authorities are not included in revenue. In the U.S., the Company sells ILUVIEN to a limited number of pharmaceutical distributors who in turn sell the product downstream to pharmacies and physician practices. Revenue from U.S. product sales is recorded upon sale to the pharmaceutical distributors net of applicable provisions for rebates and chargebacks under governmental programs, distribution-related fees and other sales-related deductions. Calculating these provisions involves management’s estimates and judgments. The Company reviews its estimates of rebates, chargebacks and other applicable provisions each period and records any necessary adjustments in the current period’s net product sales. The Company estimates reductions to product sales for Medicaid and Veterans’ Administration (VA) programs and for certain other qualifying federal and state government programs. Based upon the Company’s contracts with government agencies, statutorily-defined discounts applicable to government-funded programs, historical experience and estimated payer mix, the Company estimates and records an allowance for rebates and chargebacks. The Company’s liability for Medicaid rebates consists of estimates for claims that a state will make for a current quarter, claims for prior quarters that have been estimated for which an invoice has not been received and invoices received for claims from prior quarters that have not been paid. The Company’s reserves related to discounted pricing to VA, Public Health Services and other institutions (collectively qualified healthcare providers) represent the Company’s estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices the Company charges to its customers (i.e., pharmaceutical distributors). The Company’s customers charge the Company for the difference between what they pay for the products and the ultimate selling price to the qualified healthcare providers. The Company’s reserve for this discounted pricing is based on expected sales to qualified healthcare providers and the historical chargebacks that customers have already claimed. The Company has written contracts with its customers that include terms for distribution-related fees. The Company estimates and records distribution and related fees due to its customers based on gross sales. Consistent with industry practice, the Company offers its customers a limited right to return product purchased directly from the Company, which is principally based upon the product’s expiration date. The Company will accept returns for three months prior to and up to nine months after the product expiration date. Depending on the circumstances, the Company may provide replacement products or cash credit for returns. Product returned is generally not resalable given the nature of the Company’s products and method of administration. The Company develops estimates for product returns based upon historical experience, inventory levels, shelf life of the product and other relevant factors. The Company monitors product supply levels in the distribution channel, as well as sales by its customers to healthcare providers using product-specific data provided by its customers. If necessary, the Company’s estimates of product returns may be adjusted in the future based on actual returns experience, known or expected changes in the marketplace, or other factors. |
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Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts — Accounts receivable are generated through sales primarily to pharmacies, hospitals and wholesalers which began in 2013. The Company does not require collateral from its customers for accounts receivable. The carrying amount of accounts receivable is reduced by an allowance for doubtful accounts that reflects management’s best estimate of the amounts that will not be collected. In addition to reviewing delinquent accounts receivable, management considers many factors in estimating its general allowance, including historical data, experience, customer types, credit worthiness and economic trends. From time to time, management may adjust its assumptions for anticipated changes in any of those or other factors expected to affect collectability. Provisions for doubtful accounts are charged to operations at the time management determines these accounts may become uncollectable. The Company writes off accounts receivable when management determines they are uncollectable and credits payments subsequently received on such receivables to bad debt expense in the period received. The following summarizes activity related to the Company’s allowance for doubtful accounts: |
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Inventory | Inventory — Inventories are stated at the lower of cost or market with cost determined under the first in, first out (FIFO) method. Included in inventory costs are component parts, work-in-progress and finished goods. The Company relies on third party manufacturers for the production of all inventory and does not capitalize any internal costs. The Company periodically reviews inventories for excess, obsolete or expiring inventory and writes down obsolete or otherwise unmarketable inventory to its estimated net realizable value. If the actual net realizable value is less than that estimated, or if there are any further determinations that inventory will not be marketable based on estimates of demand, additional inventory write-downs will be required. |
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Intangible Assets | Intangible Assets — The cost of intangible assets with determinable useful lives is amortized to reflect the pattern of economic benefits consumed, which approximates a straight-line basis, over the estimated periods benefited. The estimated useful life of the intangible asset is approximately thirteen years. |
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Property and Equipment | Property and Equipment — Property and equipment are stated at cost. Additions and improvements are capitalized while repairs and maintenance are expensed. Depreciation is provided on the straight-line method over the useful life of the related assets beginning when the asset is placed in service. The estimated useful lives of the individual assets are as follows: furniture, fixtures and manufacturing equipment, five years; automobiles, four years; office equipment and leasehold improvements, 29 months to five years; and software, three years. |
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Impairment | Impairment — Property and equipment and intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When indicators of impairment are present, the Company evaluates the carrying amount of such assets in relation to the operating performance and future estimated undiscounted net cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. The assessment of the recoverability of assets will be impacted if estimated future operating cash flows are not achieved. |
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Income Taxes | Income Taxes — In accordance with the Financial Accounting Standards Board (FASB) Accounting Standard Codification (ASC) 740, Income Taxes, the Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of its assets and liabilities. The Company records a valuation allowance against its net deferred tax asset to reduce the net carrying value to an amount that is more likely than not to be realized. Income tax positions are considered for uncertainty in accordance with ASC 740-10. The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material change to its financial position; therefore, no ASC 740-10 liabilities for uncertain tax positions have been recorded. The Company will recognize accrued interest and penalties related to unrecognized tax benefits, if any, as interest expense and income tax expense, respectively, in the consolidated statements of operations. Significant management judgment is involved in determining the provision for income taxes, deferred tax assets and liabilities, and any valuation allowance recorded against net deferred tax assets. Due to uncertainties with respect to the realization of deferred tax assets as a result of the Company’s history of operating losses, a valuation allowance has been established against the net deferred tax asset balance in the U.S. The valuation allowance is based on management’s estimates of taxable income in the jurisdictions in which the Company operates and the period over which deferred tax assets will be recoverable. In the event that actual results differ from these estimates or the Company adjusts these estimates in future periods, a change in the valuation allowance may be needed, which could materially impact the Company’s financial position and results of operations. |
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Research and Development Costs | Research and Development Costs — Research and development costs are expensed as incurred. Research and development expenses were $2,146,000 and $2,395,000 for the years ended December 31, 2016 and 2015, respectively. |
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Stock-Based Compensation | Stock-Based Compensation — The Company has stock option plans which provide for grants of stock options to employees and directors to purchase shares of the Company’s common stock at exercise prices generally equal to the fair market values of such stock at the dates of grant. Compensation cost is recognized for all share-based awards based on the grant date fair value in accordance with the provisions of ASC 718, Compensation — Stock Compensation. The fair values for the options are estimated at the dates of grant using a Black-Scholes option-pricing model. Additionally, the Company sponsors an employee stock purchase plan (ESPP) under which employees may elect payroll withholdings to fund purchases of the Company’s stock at a discount. The Company estimates the fair value of the option to purchase shares of the Company’s common stock using the Black-Scholes valuation model and recognizes compensation expense in accordance with the provisions of ASC 718-50, Employee Share Purchase Plans. |
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Derivative Financial Instruments | Derivative Financial Instruments — The Company generally does not use derivative instruments to hedge exposures to cash flow or market risks. However, certain warrants to purchase Series A Convertible Preferred Stock or common stock that do not meet the requirements for classification as equity, in accordance with the Derivatives and Hedging Topic of the ASC, are classified as liabilities. In such instances, net-cash settlement is assumed for financial reporting purposes, even when the terms of the underlying contracts do not provide for a net-cash settlement. These warrants were considered derivative instruments at issuance because the agreements provide for settlement in Series A Convertible Preferred Shares or common shares at the option of the holder, an adjustment to the warrant exercise price for common shares at some point in the future and contain anti-dilution provisions whereby the number of shares for which the warrants are exercisable and/or the exercise price of the warrants are subject to change in the event of certain issuances of stock at prices below the then-effective exercise price of the warrants. The warrant exercise price no longer can be adjusted at some point in the future. The primary underlying risk exposure pertaining to the warrants is the change in fair value of the underlying common stock. Such financial instruments are initially recorded at fair value with subsequent changes in fair value recorded as a component of change in fair value of derivative warrant liability in the consolidated statements of operations in each reporting period. If these instruments subsequently meet the requirements for equity classification, the Company reclassifies the fair value to equity. As of December 31, 2016 and 2015, these warrants represented the only outstanding derivative instruments issued or held by the Company. |
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Fair Value of Financial Instruments | Fair Value of Financial Instruments — The carrying amounts of the Company’s financial instruments, including cash and cash equivalents and current assets and liabilities approximate their fair value because of their short maturities. The weighted average interest rate of the Company’s notes payable approximates the rate at which the Company could obtain alternative financing; therefore, the carrying amount of the note approximates the fair value. The Company uses the Black-Scholes option pricing model and assumptions that consider, among other variables, the fair value of the underlying stock, risk-free interest rate, volatility, expected life and dividend rates in estimating fair value for the warrants considered to be derivative instruments. |
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Translation Policy | Translation Policy - The U.S. dollar is the functional currency for Alimera Sciences, Inc. The Euro is the functional currency for the majority of the Company’s subsidiaries operating outside of the U.S. For Alimera Sciences, Inc., foreign currency assets and liabilities are remeasured into U.S. dollars at end-of-period exchange rates, except for non-monetary balance sheet accounts, which are remeasured at historical exchange rates. Revenue and expenses are remeasured at average exchange rates in effect during each period, except for those expenses related to the non-monetary balance sheet amounts, which are remeasured at historical exchange rates. Gains or losses from foreign currency remeasurements are included in the statement of operations. The financial statements of the foreign subsidiaries whose functional currency is not the U.S. dollar, have been translated into U.S. dollars in accordance with ASC 830-30, Translation of Financial Statements. For the subsidiaries operating outside of the U.S. that are denominated in the Euro, assets and liabilities are translated at end-of-period rates while revenues and expenses are translated at average rates in effect during the period in which the activity took place. Equity is translated at historical rates and the resulting cumulative translation adjustments are included as a component of accumulated other comprehensive loss. |
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Earnings Per Share (EPS) | Earnings Per Share (EPS) — Basic EPS is calculated in accordance with ASC 260, Earnings per Share by dividing net income or loss attributable to common stockholders by the weighted average common stock outstanding. Diluted EPS is calculated in accordance with ASC 260 by adjusting weighted average common shares outstanding for the dilutive effect of common stock options, warrants, convertible preferred stock and accrued but unpaid convertible preferred stock dividends. In periods where a net loss is recorded, no effect is given to potentially dilutive securities, since the effect would be anti-dilutive. Common stock equivalent securities that would potentially dilute basic EPS in the future, but were not included in the computation of diluted EPS because to do so would have been anti-dilutive, were as follows:
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Reporting Segments | Reporting Segments — The Company determines operating segments in accordance with its internal operating structure. The Company’s chief operating decision maker is the Chief Executive Officer (CEO). While the CEO is apprised of a variety of financial metrics and information, the business is principally managed and organized based upon geographic and regulatory environment. Each segment is separately managed and is evaluated primarily upon net loss from operations. The Company does not report balance sheet information by segment since it is not reviewed by the Company’s chief operating decision maker. The Company has two reportable segments, U.S. and International. |
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Promotional and Advertising Costs | Promotional and Advertising Costs — Promotional and advertising costs are expensed as incurred. |
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Adoption of New Accounting Pronouncements | Adoption of New Accounting Standards — In June 2014, the FASB issued Accounting Standards Update (ASU) 2014-12, Compensation Stock - Compensation (Topic 718). ASU 2014-12 applies to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. It requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition and follows existing accounting guidance for the treatment of performance conditions. The standard was effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. The adoption of this guidance did not have a material impact on its financial statements. In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014-15 requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued and provides guidance on determining when and how to disclose going concern uncertainties in the financial statements. ASU 2014-15 applies to all entities and is effective for annual and interim reporting periods ending after December 15, 2016, with early adoption permitted. The adoption of this guidance did not have a material impact on its financial statements. In April 2015, the Financial Accounting Standards Board (FASB) issued ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. ASU 2015-03 is intended to simplify the presentation of debt issuance costs. These amendments require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted and the standard is to be retrospectively applied to all periods presented upon adoption. The Company elected to early adopt ASU 2015-03 effective December 31, 2015, and as a result the Company reclassified $629,000 from deferred financing costs to note payable in its Consolidated Balance Sheet as of December 31, 2015. In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes, which simplifies the presentation of deferred income taxes. This ASU requires that deferred tax assets and liabilities be classified as non-current in a statement of financial position. The Company elected to early adopt ASU 2015-17 effective December 31, 2015 on a prospective basis. Adoption of this ASU resulted in a reclassification of our net current deferred tax asset to the net non-current deferred tax asset in its Consolidated Balance Sheet as of December 31, 2015. Accounting Standards Issued but Not Yet Effective — In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), as subsequently amended. ASU 2014-09 provides a single, comprehensive revenue recognition model for all contracts with customers. The revenue guidance contains principles that an entity will apply to determine the measurement of revenue and timing of when it is recognized. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The standard is effective for the first interim period within annual reporting periods beginning after December 15, 2017 for public entities, with early adoption permitted in the annual reporting period beginning after December 15, 2016. The Company has begun its evaluation of the new guidance on its business and, at this time, do not believe there will be a material impact on the Company’s current direct product sales in international markets. For the U.S. business, the Company continues to evaluate the variable consideration provisions of the new guidance and the impact it will have specifically on the Company’s gross to net revenue adjustments, including chargebacks and rebates. The Company anticipates adopting the new revenue standard using the modified retrospective transition method. In July 2015, FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. This update requires entities to measure inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. This ASU is effective for annual reporting periods beginning after December 15, 2016 and interim periods within those years. The Company does not expect the impact of the adoption to have a material effect on its financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This standard requires all leases with durations greater than twelve months to be recognized on the balance sheet and is effective for interim and annual reporting periods beginning after December 15, 2018, although early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption on its financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation—Stock Compensation (Topic 718). This standard makes several modifications to Topic 718 related to the accounting for forfeitures, employer tax withholding on share-based compensation and the financial statement presentation of excess tax benefits or deficiencies. ASU 2016-09 also clarifies the statement of cash flows presentation for certain components of share-based awards. The standard is effective for interim and annual reporting periods beginning after December 15, 2016, although early adoption is permitted. The Company does not expect the impact of the adoption to have a material effect on its financial statements. |
Summary of Significant Accounting Policies (Tables) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Allowances fro Doubtful Accounts | The following summarizes activity related to the Company’s allowance for doubtful accounts:
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Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | Common stock equivalent securities that would potentially dilute basic EPS in the future, but were not included in the computation of diluted EPS because to do so would have been anti-dilutive, were as follows:
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Inventory (Tables) |
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Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventory | Inventory consisted of the following:
(1) Component parts inventory consisted of manufactured components of the ILUVIEN applicator. (2) Work-in-process consisted of completed units of ILUVIEN that are undergoing, but have not completed, quality assurance testing as required by U.S. or EEA regulatory authorities. |
Property and Equipment (Tables) |
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Schedule of Property and Equipment | Property and equipment consisted of the following:
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Intangible Assets (Tables) |
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Schedule of Intangible Assets Future Amortization Expense | The estimated remaining amortization as of December 31, 2016 is as follows (in thousands):
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Accrued Expenses (Tables) |
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Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Accrued Expenses | Accrued expenses consisted of the following:
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Commitments and Contingencies (Tables) |
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Future Minimum Principal Payments Under Note Payable | As of December 31, 2016 a schedule of future minimum principal payments, excluding PIK Interest and excluding the End of Term Payment of $1,400,000 which is payable in May 2018, under the Note Payable is as follows (in thousands):
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Future Minimum Rental Payments for Operating Leases | As of December 31, 2016, a schedule by year of future minimum payments under all of the Company’s operating leases is as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule by Year of Future Minimum Payments under Capital Leases, Together with Present Value of Minimum Lease Payments | As of December 31, 2016, a schedule by year of future minimum payments under capital leases, together with the present value of minimum lease payments, is as follows (in thousands):
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property and Equipment Under Capital Leases | Property and equipment under capital leases, which are included in property and equipment (Note 5), consisted of the following:
|
Stock Incentive Plans (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Stock Option Transactions | A summary of stock option transactions under the plans are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Additional Stock Option Transactions | The following table provides additional information related to outstanding stock options, fully vested stock options, and stock options expected to vest as of December 31, 2016:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Weighted-Average Assumptions Used for Option Grants | The weighted-average assumptions used for option grants were as follows:
|
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Employee Stock-Based Compensation Expense | Employee stock-based compensation expense related to stock options recognized in accordance with ASC 718 was as follows:
|
Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Net Loss before Taxes | The components of net loss before taxes are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Income Tax Benefit | The provision for income taxes consists of the following components:
|
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Summary of Valuation Allowance | The following summarizes activity related to the Company’s valuation allowance:
|
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Net Deferred Tax Assets (Liabilities) | Worldwide net deferred tax assets and liabilities are as follows:
|
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Reconciliation of Income Tax Benefit to Amount Determined by Applying U.S. Federal Statutory Income Tax Rate | A reconciliation from the federal statutory rate to the total provision for income taxes is as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Uncertain Tax Positions Rollforward | A rollforward of the Company’s uncertain tax positions is as follows:
|
Fair Value (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets Measured at Fair Value on Recurring Basis | The following fair value table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis:
|
Segment Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Reporting Segments | The following table presents a summary of the Company’s reporting segments for the years ended December 31, 2016 and 2015:
|
Selected Quarterly Financial Data (Unaudited) (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Quarterly Financial Information | Selected quarterly financial data for years ended December 31, 2016 and 2015 are as follows (in thousands except per share data):
|
Nature of Operations (Detail) - ILUVIEN |
12 Months Ended |
---|---|
Dec. 31, 2016
Patient
| |
Nature Of Operations [Line Items] | |
Post-authorization open study period | 5 years |
Maximum number of patients involved in post-authorization open study period | 800 |
Number of patients involved in post-authorization open study period | 548 |
Summary of Significant Accounting Policies - Prior Period Adjustments (Details) - Effect of early adoption $ in Thousands |
Dec. 31, 2015
USD ($)
|
---|---|
Deferred Financing Costs | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |
Debt issuance costs | $ (629) |
Notes Payable | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |
Debt issuance costs | $ (629) |
Summary of Significant Accounting Policies - Additional Information (Detail) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016
USD ($)
Segment
|
Dec. 31, 2015
USD ($)
|
Dec. 31, 2014
USD ($)
|
|
Accounting Policies [Abstract] | |||
Cash and cash equivalents | $ 30,979 | $ 31,075 | $ 76,697 |
Percentage of cash and cash equivalents in domestic financial institutions | 92.00% | 90.00% | |
Useful life of intangible assets | 13 years | ||
Research and development expense | $ 2,146 | $ 2,395 | |
Number of reportable segments | Segment | 2 |
Summary of Significant Accounting Policies - Long Lived Assets (Details) |
12 Months Ended |
---|---|
Dec. 31, 2016 | |
Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Automobiles | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 4 years |
Office equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 29 months |
Office equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Software | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
Summary of Significant Accounting Policies - Allowances for Doubtful Accounts (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Allowance for Doubtful Accounts Receivable [Roll Forward] | ||
Beginning balance | $ 118 | $ 0 |
Bad debt expense | 0 | 118 |
Recovery of bad debt reserve | (118) | 0 |
Ending balance | $ 0 | $ 118 |
Going Concern (Detail) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
---|---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Accumulated deficit | $ (377,074) | $ (343,900) | |
Cash and cash equivalents | 30,979 | $ 31,075 | $ 76,697 |
Capital shares reserved for future issuance | $ 22,000 |
Inventory (Detail) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
|||||
---|---|---|---|---|---|---|---|
Inventory net realizable value | |||||||
Component parts (1) | [1] | $ 115 | $ 131 | ||||
Work-in-process (2) | [2] | 18 | 333 | ||||
Finished goods | 353 | 1,525 | |||||
Total inventory | 486 | 1,989 | |||||
Inventory reserve | (40) | (437) | |||||
Inventory — net | $ 446 | $ 1,552 | |||||
|
Property and Equipment (Detail) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 4,421 | $ 4,509 |
Less accumulated depreciation and amortization | (2,634) | (1,956) |
Property and equipment — net | 1,787 | 2,553 |
Depreciation expense | 822 | 614 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 391 | 376 |
Office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 838 | 794 |
Automobiles | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 762 | 1,028 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 973 | 902 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 460 | 439 |
Manufacturing equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 997 | $ 970 |
Intangible Assets - Activity (Details) - USD ($) |
1 Months Ended | 12 Months Ended | |
---|---|---|---|
Oct. 31, 2014 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Finite-Lived Intangible Assets [Line Items] | |||
Useful life | 13 years | ||
Intangible assets, net | $ 20,604,000 | ||
Licensing Agreement | |||
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets, gross | $ 25,000,000 | ||
Useful life | 13 years | ||
Intangible assets, net | $ 20,604,000 | $ 22,549,000 | |
Intangible asset amortization expense | $ 1,946,000 | $ 1,940,000 | |
pSivida | |||
Finite-Lived Intangible Assets [Line Items] | |||
Additional milestone payment after the first product approved by the FDA | $ 25,000,000 |
Intangible Assets - Future Amortization Expense (Details) $ in Thousands |
Dec. 31, 2016
USD ($)
|
---|---|
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2017 | $ 1,940 |
2018 | 1,940 |
2019 | 1,940 |
2020 | 1,946 |
2021 | 1,940 |
Thereafter | 10,898 |
Total | $ 20,604 |
Accrued Expenses (Detail) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Summary of accrued expenses | ||
Accrued clinical investigator expenses | $ 1,122 | $ 732 |
Accrued other compensation expenses | 1,020 | 804 |
Accrued rebate, chargeback and other revenue reserves | 809 | 452 |
Accrued End of Term Payment (Note 9) | 0 | 1,050 |
Other accrued expenses | 807 | 873 |
Total accrued expenses | $ 3,758 | $ 3,911 |
Commitments and Contingencies - Schedule of Future Minimum Principal Payments Under Note Payable (Detail) $ in Thousands |
Dec. 31, 2016
USD ($)
|
---|---|
Long-term Debt, Fiscal Year Maturity [Abstract] | |
2018 | $ 1,300 |
2019 | 16,526 |
2020 | 17,174 |
Total | $ 35,000 |
Commitments and Contingencies - Schedule of Operating Lease Assets (Details) $ in Thousands |
Dec. 31, 2016
USD ($)
|
---|---|
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2017 | $ 547 |
2018 | 512 |
2019 | 459 |
2020 | 350 |
2021 | 268 |
Total | $ 2,136 |
Commitments and Contingencies - Schedule by Year of Future Minimum Payments under Capital Leases, Together with Present Value of Minimum Lease Payments (Detail) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2017 | $ 300 | |
2018 | 289 | |
2019 | 107 | |
2020 | 3 | |
Total | 699 | |
Less amount representing interest | (41) | |
Less amount representing executory costs | (193) | |
Present value of minimum lease payments | 465 | |
Less current portion | (191) | $ (234) |
Non-current portion | $ 274 | $ 582 |
Commitments and Contingencies - Property and Equipment Under Capital Leases (Detail) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Capital Leased Assets [Line Items] | ||
Less accumulated depreciation | $ (342) | $ (212) |
Total | 483 | 879 |
Automobiles | ||
Capital Leased Assets [Line Items] | ||
Gross capital leased assets | 762 | 1,028 |
Office equipment | ||
Capital Leased Assets [Line Items] | ||
Gross capital leased assets | $ 63 | $ 63 |
Stock Incentive Plans - Summary of Stock Option Transactions (Detail) - $ / shares |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Options | ||
Options outstanding at beginning of period (in shares) | 9,475,890 | 7,681,256 |
Grants (in shares) | 2,195,250 | 2,570,000 |
Forfeitures (in shares) | (581,497) | (431,114) |
Exercises (in shares) | (285,231) | (344,252) |
Options outstanding at year end (in shares) | 10,804,412 | 9,475,890 |
Options exercisable at year end (in shares) | 7,363,400 | 5,808,528 |
Weighted average per share fair value of options granted during the period (in dollars per share) | $ 1.55 | $ 3.58 |
Weighted Average Exercise Price | ||
Options outstanding at beginning of period (in dollars per share) | 3.43 | 3.03 |
Grants (in dollars per share) | 2.05 | 4.62 |
Forfeitures (in dollars per share) | 3.15 | 4.79 |
Exercises (in dollars per share) | 1.41 | 1.66 |
Options outstanding at year end (in dollars per share) | 3.22 | 3.43 |
Options exercisable at year end (in dollars per share) | $ 3.29 | $ 3.27 |
Stock Incentive Plans - Weighted-Average Assumptions Used for Option Grants (Detail) - $ / shares |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Risk-free interest rate (percent) | 1.57% | 1.55% |
Volatility factor (percent) | 93.54% | 96.80% |
Grant date fair value of common stock options (in dollars per share) | $ 1.55 | $ 3.58 |
Weighted-average expected life | 5 years 11 months 27 days | 6 years 10 days |
Assumed forfeiture rate (percent) | 10.00% | 10.00% |
Stock Incentive Plans - Employee Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total employee stock-based compensation expense | $ 4,809 | $ 4,928 |
Sales and marketing | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total employee stock-based compensation expense | 1,109 | 925 |
Research, development and medical affairs | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total employee stock-based compensation expense | 886 | 1,271 |
General and administrative | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total employee stock-based compensation expense | $ 2,814 | $ 2,732 |
Concentrations and Credit Risk (Details) - customer |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Revenue | Customer concentration risk | ||
Concentration Risk [Line Items] | ||
Concentration risk, number of customers | 2 | |
Concentration risk percentage | 75.00% | 68.00% |
Accounts receivable | Customer concentration risk | ||
Concentration Risk [Line Items] | ||
Concentration risk, number of customers | 2 | |
Concentration risk percentage | 90.00% | 88.00% |
Purchases | Supplier concentration risk | ||
Concentration Risk [Line Items] | ||
Concentration risk, number of vendors | 0 | 0 |
Income Taxes - Components of Net Loss before Taxes (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Income Tax Disclosure [Abstract] | ||
United States | $ (8,516) | $ (6,026) |
Foreign | (24,486) | (24,489) |
Loss before provision for income taxes | $ (33,002) | $ (30,515) |
Income Taxes - Components of Income Tax Benefit (Detail) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Current Income Tax Expense (Benefit), Continuing Operations [Abstract] | ||
Federal | $ 0 | $ 0 |
State | 0 | 0 |
Foreign | 385 | 353 |
Current income tax expense | 385 | 353 |
Deferred benefit (expense): | ||
Federal | 3,099 | 6,509 |
State | (858) | 819 |
Foreign | (213) | (223) |
Deferred benefit (expense), gross | 2,028 | 7,105 |
Valuation allowance | (2,241) | (7,328) |
Deferred income tax benefit | (213) | (223) |
Total income tax expense | $ 172 | $ 130 |
Income Taxes - Valuation Allowance Rollforward (Details) - Deferred Tax Asset Valuation Allowance - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Beginning balance | $ (53,727) | $ (46,399) |
Income tax provision | (2,241) | (7,328) |
Release of valuation allowance | 0 | 0 |
Other | 0 | 0 |
Ending balance | $ (55,968) | $ (53,727) |
Income Taxes - Net Deferred Tax Assets (Liabilities) (Detail) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Deferred tax assets | ||
Depreciation and amortization | $ 12 | $ 3 |
Other deferred tax assets | 5,824 | 4,643 |
NOL carry-forwards | 38,183 | 36,941 |
Research and development costs | 3,063 | 4,193 |
Collaboration agreement receivable reserves | 9,327 | 8,186 |
Valuation allowance | (55,968) | (53,727) |
Total deferred tax assets | 441 | 239 |
Deferred tax liabilities | ||
Unrealized foreign currency gains | 0 | (12) |
Other deferred tax liabilities | (5) | (4) |
Total deferred tax liabilities | (5) | (16) |
Net deferred tax assets and deferred tax liabilities | $ 436 | $ 223 |
Income Taxes - Uncertain Tax Positions Rollforward (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Income Tax Disclosure [Abstract] | ||
Unrecognized tax benefits, beginning balance | $ 46 | $ 0 |
Gross increases - tax positions in current period | 16 | 3 |
Gross increases - tax positions in prior period | 13 | 43 |
Gross decreases - tax positions in prior period | (16) | 0 |
Settlements | 0 | 0 |
Lapse of statute of limitations | 0 | 0 |
Unrecognized tax benefits, ending balance | $ 59 | $ 46 |
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Operating Loss Carryforwards [Line Items] | |||
Stock option expense | $ 517 | ||
Unrecognized tax benefits | 59 | $ 46 | $ 0 |
Cumulative book losses in foreign subsidiaries | (92,939) | ||
Federal | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carry-forwards | 104,944 | 100,844 | |
State | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carry-forwards | $ 83,270 | $ 84,301 |
Fair Value (Detail) - Recurring basis - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
|||||
---|---|---|---|---|---|---|---|
Assets: | |||||||
Cash equivalents | [1] | $ 0 | $ 1,010 | ||||
Assets measured at fair value | 0 | 1,010 | |||||
Liabilities: | |||||||
Derivative warrant liability | [2] | 188 | 2,815 | ||||
Liabilities measured at fair value | 188 | 2,815 | |||||
Level 1 | |||||||
Assets: | |||||||
Cash equivalents | [1] | 0 | 1,010 | ||||
Assets measured at fair value | 0 | 1,010 | |||||
Liabilities: | |||||||
Derivative warrant liability | [2] | 0 | 0 | ||||
Liabilities measured at fair value | 0 | 0 | |||||
Level 2 | |||||||
Assets: | |||||||
Cash equivalents | [1] | 0 | 0 | ||||
Assets measured at fair value | 0 | 0 | |||||
Liabilities: | |||||||
Derivative warrant liability | [2] | 188 | 2,815 | ||||
Liabilities measured at fair value | 188 | 2,815 | |||||
Level 3 | |||||||
Assets: | |||||||
Cash equivalents | [1] | 0 | 0 | ||||
Assets measured at fair value | 0 | 0 | |||||
Liabilities: | |||||||
Derivative warrant liability | [2] | 0 | 0 | ||||
Liabilities measured at fair value | $ 0 | $ 0 | |||||
|
Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2015 |
Sep. 30, 2015 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Quarterly Financial Information Disclosure [Abstract] | ||||||||||
NET REVENUE | $ 10,677 | $ 8,298 | $ 9,557 | $ 5,801 | $ 5,823 | $ 6,901 | $ 5,776 | $ 3,938 | $ 34,333 | $ 22,438 |
COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION | (924) | (486) | (556) | (378) | (469) | (634) | (376) | (283) | (2,344) | (1,762) |
GROSS PROFIT | 9,753 | 7,812 | 9,001 | 5,423 | 5,354 | 6,267 | 5,400 | 3,655 | 31,989 | 20,676 |
NET LOSS FROM OPERATIONS | (5,365) | (7,243) | (6,449) | (8,790) | (9,761) | (8,444) | (9,800) | (10,994) | (27,847) | (38,999) |
NET LOSS | (5,838) | (9,212) | (6,816) | (11,136) | (10,713) | (1,543) | (8,596) | (9,793) | $ (33,174) | $ (30,645) |
NET LOSS APPLICABLE TO COMMON STOCKHOLDERS | $ (5,926) | $ (9,245) | $ (6,858) | $ (11,145) | $ (10,713) | $ (1,543) | $ (8,596) | $ (9,793) | ||
NET LOSS PER SHARE APPLICABLE TO COMMON SHAREHOLDERS — Basic and diluted (in dollars per share) | $ (0.09) | $ (0.16) | $ (0.15) | $ (0.25) | $ (0.24) | $ (0.03) | $ (0.19) | $ (0.22) | $ (0.63) | $ (0.69) |
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