Organization

12 Months Ended

Dec. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization

1. Organization

Pulmatrix, Inc. (the “Company”) was incorporated in 2013 as a Nevada corporation and converted to a Delaware corporation in September 2013. On June 15, 2015, the Company completed a merger with Pulmatrix Operating Company, changed its name from Ruthigen, Inc. to “Pulmatrix, Inc.” and relocated its corporate headquarters to Lexington, Massachusetts. The Company is a clinical stage biotechnological company and is focused on the development of novel inhaled therapeutic products intended to prevent and treat respiratory diseases and infections.

Reverse Stock Split

On February 3, 2019, the Board approved a 1-for-10 reverse stock split of our issued and outstanding shares of common stock (the “Reverse Stock Split”) and the Company’s common stock began trading on a split-adjusted basis when the market opened on February 6, 2019. With the Reverse Stock Split, every 10 shares of the Company’s issued and outstanding common stock were automatically converted into one share of common stock, without any change in the par value per share. Any fraction of a share of common stock that would otherwise have resulted from the Reverse Stock Split will be rounded up to the nearest whole share. Accordingly, all common share and per share data are retrospectively restated to give effect of the split for all periods presented herein.

Liquidity, Going Concerns and Management Plans

At December 31, 2018, the Company had unrestricted cash of $2.6 million and working capital of $0.4 million. The Company had incurred recurring losses and as of December 31, 2018 had an accumulated deficit of $194.6 million. During the year ended December 31, 2018, the Company had used approximately $16.8 million in its operating activities. The Company has primarily financed operations to date through the sale of equity securities and a term loan. The Company will be required to raise additional capital within the next year to continue the development and commercialization of current product candidates and to continue to fund operations at the current cash expenditure levels. These conditions raise substantial doubt about the Company’s ability to continue as a going concern over the next twelve months from the date of issuance of this Annual Report on Form 10-K and meet its obligations.

During the year ended December 31, 2018, the Company raised an aggregate of $19.3 million in net proceeds through the sale of its common stock (note 8). Subsequent to December 31, 2018, the Company further raised an aggregate of $3.7 million in gross proceeds through the sale of its common stock (note 8). The accompanying financial statements have been prepared under the assumption the Company will continue to operate as a going concern, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The consolidated financial statements as of December 31, 2018, do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts of liabilities that may result from uncertainty related to the Company’s ability to continue as a going concern over the next twelve months from the date of issuance of this Annual Report on Form 10-K.

The Company cannot be certain that additional funding will be available on acceptable terms, or at all. To the extent that the Company raises additional funds by issuing equity securities, the Company’s stockholders may experience significant dilution. Any debt financing, if available, may involve restrictive covenants that impact the Company’s ability to conduct business. If unable to raise additional capital when required or on acceptable terms, the Company may have to (i) delay, scale back or discontinue the development and/or commercialization of one or more product candidates; (ii) seek collaborators for product candidates at an earlier stage than otherwise would be desirable and on terms that are less favorable than might otherwise be available; or (iii) relinquish or otherwise dispose of rights to technologies, product candidates or products that the Company would otherwise seek to develop or commercialize ourselves on unfavorable terms.

Management believes that the Company does not have sufficient capital resources to sustain operations through at least the next twelve months from the date of this filing. The Company’s ability to continue as a going concern is dependent upon its ability to obtain additional equity or debt financing and, ultimately, to generate revenue. There will be continued doubt about the Company’s ability to continue as a going concern if the Company is unable to do so.