Shareholders' (Deficit) Equity

3 Months Ended

Mar. 31, 2024

Stockholders' Equity Note [Abstract]

Shareholders' (Deficit) Equity

Note 6. Shareholders’ (Deficit) Equity

Ordinary Shares

On June 30, 2023, the Company’s shareholders approved an increase to the number of authorized ordinary shares, par value $0.0001 (the “Ordinary Shares”), the Company can issue by 35,000,000,000 ordinary shares in addition to the number of shares outstanding on June 30, 2023. Accordingly, as of March 31, 2024 and December 31, 2023, the Company was authorized to issue up to 45,122,321,523 ordinary shares.

Currently, each ADS represents 2,000 Ordinary Shares (the “ADS Ratio”). All ADS and per ADS amounts in the accompanying condensed consolidated financial statements reflect the ADS Ratio.

March 2024 Private Placement

In March 2024, the Company entered into a definitive purchase agreement with certain existing investors, pursuant to which the Company sold and issued in a private placement an aggregate of 1,320,614 ADSs at $1.48 per ADS, for aggregate gross proceeds of approximately $2.0 million (the “March 2024 Private Placement”). Net proceeds from the March 2024 Private Placement were approximately $1.7 million after deducting placement agent fees and other expenses.

At close of the March 2024 Private Placement, the Company issued to Paulson Investment Company, LLC (“Paulson”), as placement agent for the March 2024 Private Placement, warrants to purchase 132,061 ADSs at an exercise price of $1.85 per ADS (representing 125% of the purchase price per ADS sold in the March 2024 Private Placement) and a term expiring on March 27, 2029 (the “March 2024 Placement Agent Warrants”). The estimated fair value of the March 2024 Placement Agent Warrants on the issuance date was approximately $0.2 million.

The Company determined that the March 2024 Placement Agent Warrants met all of the criteria for equity classification. Accordingly, upon closing of the March 2024 Private Placement, each of the March 2024 Placement Agent Warrants were recorded as a component of additional paid-in capital.

December 2023 Private Placement

In December 2023, the Company entered into purchase agreements to sell, in a private placement, to existing investors, Dr. Ray Prudo, M.D., the Company’s Chairman, and Dr. Samir Patel, M.D., director, (the “December 2023 Private Placement”) an aggregate of 947,868 ADSs at $2.11 per ADS, for aggregate gross proceeds of approximately $2.0 million. Net proceeds from the December 2023 Private Placement were approximately $1.8 million after deducting placement agent fees and other expenses.

September 2023 Private Placement

In September 2023, the Company entered into purchase agreements to sell in a private placement to existing investors and directors, including Dr. Prudo and Ms. Rachelle Jacques, the Company’s then President and Chief Executive Officer (the “September 2023 Private Placement”) an aggregate of 551,816 ADSs at $3.30 per ADS, and pre-funded warrants (the “Pre-Funded Warrants”) to purchase up to 48,387 ADSs at a purchase price per Pre-Funded Warrant of $3.10, for aggregate gross proceeds of approximately $2.0 million. The Pre-Funded Warrants are exercisable at an exercise price of $0.20 per ADS and will not expire until exercised in full. The September 2023 Private Placement closed in October 2023 resulting in net proceeds of approximately $1.7 million after deducting placement agent fees and other expenses.

At close of the September 2023 Private Placement, the Company issued to Paulson, as placement agent for the September 2023 Private Placement, warrants to purchase 42,550 ADSs at an exercise price of $4.13 per ADS (representing 125% of the purchase price per ADS sold in the September 2023 Private Placement) and a term expiring on October 6, 2028 (the “October 2023 Placement Agent Warrants”). The estimated fair value of the October 2023 Placement Agent Warrants on the issuance date was approximately $0.1 million.

The Company determined that the Pre-Funded Warrants and October 2023 Placement Agent Warrants met all of the criteria for equity classification. Accordingly, upon closing of the September 2023 Private Placement, each of the Pre-Funded Warrants and October 2023 Placement Agent Warrants were recorded as a component of additional paid-in capital.

March 2023 Registered Direct Offering

On March 31, 2023, the Company entered into securities purchase agreements with certain accredited and institutional investors, including Dr. Prudo (the “March Registered Direct Offering”) providing for the issuance of an aggregate of 1,333,333 ADSs in a registered direct offering at $3.00 per ADS, resulting in gross proceeds of approximately $4.0 million. Net proceeds from the March Registered Direct Offering were approximately $3.5 million after deducting placement agent fees and expenses.

Warrants

In connection with various financing transactions, the Company has issued warrants to purchase the Company’s ordinary shares represented by ADSs. The Company accounts for such warrants as equity instruments or liabilities, depending on the specific terms of the warrant agreement. See Note 2 for further details on accounting policies related to the Company’s warrants.

The following table summarizes the Company’s outstanding warrants as of March 31, 2024 and December 31, 2023:

	Number of Warrant ADSs
	March 31,		December 31,		Weighted-Average
	2024		2023		Exercise Price		Expiration Date
Equity-classified Warrants
2019 Investor Warrants		59,211		59,211	$	60.00	7/1/2024
2019 Placement Warrants		8,881		8,881	$	57.00	6/28/2024
2020 Investor Warrants		139,882		139,882	$	44.00	Feb-Mar 2025
2020 Placement Warrants		22,481		22,481	$	51.00	Feb-Mar 2025
July 2021 Placement Agent Warrants		19,919		19,919	$	46.40	7/7/2026
December 2021 Investor Warrants		107,775		107,775	$	33.00	1/4/2027
December 2021 Placement Agent    Warrants		8,622		8,622	$	35.00	12/29/2026
March 2022 Investor Warrants		186,020		186,020	$	28.00	3/10/2027
March 2022 Placement Agent Warrants		14,882		14,882	$	30.00	3/10/2027
October 2023 Investor Prefunded    Warrants		48,387		48,387	$	0.20		—
October 2023 Placement Agent Warrants		42,550		42,550	$	4.13	10/6/2028
March 2024 Placement Agent Warrants		132,061		—	$	1.85	3/27/2029
		790,671		658,610
Liability-classified Warrants
September 2022 Series A Investor    Warrants		755,000		755,000	$	17.00	9/14/2024
September 2022 Series B Investor    Warrants		755,000		755,000	$	17.00	9/14/2029
		1,510,000		1,510,000
Total outstanding		2,300,671		2,168,610

The following table summarizes the Company’s warrants activity for the three months ended March 31, 2024:

	Number of		Weighted-Average
($ in thousands, except per share data)	Warrants		Exercise Price
Outstanding at December 31, 2023		2,168,610	$	21.97
Issued		132,061		1.85
Exercised		—		—
Expired		—		—
Outstanding at March 31, 2024		2,300,671	$	20.82

Capital Redemption Reserve

In December 2020, for the purposes of changing the nominal value of the Company's ordinary shares from £0.01 to $0.0001 the Company issued 3,847,331,913 deferred shares (the "Deferred Shares") of $0.01315. The Deferred Shares were created for technical reasons of company law and did not increase the aggregate value of share capital. Also in December 2020, the Deferred Shares were purchased by the Company in accordance with their terms of issue for aggregate consideration of $0.01 and immediately cancelled. The aggregate nominal value at cancellation was $50.6 million.

Amounts transferred from share capital on the redemption of the Deferred Shares of $50.6 million, along with the resulting foreign currency effect of the redenomination of Company ordinary shares of $1.6 million, are classified as "capital redemption reserve" within the Company's condensed consolidated balance sheets and condensed statements of shareholders' (deficit) equity.