0001558370-20-013826 | 10-Q | XBRL Viewer | Neurobo Pharmaceuticals INC

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2020	Nov. 06, 2020
Cover [Abstract]
Document Type	10-Q
Document Period End Date	Sep. 30, 2020
Entity Registrant Name	NeuroBo Pharmaceuticals, Inc.
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		16,427,307
Entity Central Index Key	0001638287
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Amendment Flag	false

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Current assets:
Cash	$ 12,353	$ 13,908
Restricted cash		15
Prepaid expenses	511	153
Other assets	34	42
Total current assets	12,898	14,118
Right-of-use assets	100	116
Property and equipment, net	167	200
Other assets	33	34
Total assets	13,198	14,468
Current liabilities:
Accounts payable	1,101	638
Accrued liabilities	2,491	1,422
Lease liability, short-term	23	22
Total current liabilities	3,615	2,082
Lease and other long-term liabilities	77	94
Total liabilities	3,692	2,176
Commitments and contingencies (Note 5)
Stockholders’ equity:
Preferred stock, $0.001 par value; 10,000,000 shares authorized; no shares issued or outstanding as of September 30, 2020 and December 31, 2019.
Common stock, $0.001 par value per share, 100,000,000 shares authorized; 16,427,307 and 15,592,718 shares issued and outstanding as of September 30, 2020 and December 31, 2019, respectively.	17	16
Additional paid–in capital	56,526	49,130
Accumulated other comprehensive (loss) income	(3)	12
Accumulated deficit	(47,034)	(36,866)
Total stockholders’ equity	9,506	12,292
Total liabilities and stockholders’ equity	$ 13,198	$ 14,468

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Operating expenses:
Research and development	$ 1,265	$ 1,150	$ 4,091	$ 3,898
General and administrative	1,795	2,495	6,110	4,085
Total operating expenses	3,060	3,645	10,201	7,983
Loss from operations	(3,060)	(3,645)	(10,201)	(7,983)
Interest income (expense), net	6	24	34	(3)
Other (expense) income, net			(1)
Loss before income taxes	(3,054)	(3,621)	(10,168)	(7,986)
Provision for income taxes	0	0	0	0
Net loss	(3,054)	(3,621)	(10,168)	(7,986)
Other comprehensive loss (loss):
Foreign currency translation gain (loss), net of tax	13	(11)	(15)	(2)
Total other comprehensive income (loss)	13	(11)	(15)	(2)
Comprehensive loss	$ (3,041)	$ (3,632)	$ (10,183)	$ (7,988)
Loss per share:
Net loss per share, basic and diluted (Note 11)	$ (0.19)	$ (0.70)	$ (0.63)	$ (1.55)
Weighted average common shares outstanding:
Basic and diluted	16,427,307	5,166,812	16,135,000	5,166,812

Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) - USD ($) $ in Thousands	Redeemable Convertible Preferred Stock	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive (loss) Income	Accumulated Deficit	Total
Balance at beginning of period at Dec. 31, 2018	$ 16,746		$ 2,266	$ 2	$ (15,554)	$ (13,286)
Balance at beginning of period (shares) at Dec. 31, 2018	4,801,020	5,166,812
Increase (Decrease) in Stockholders' Equity
Stock–based compensation			60			60
Foreign currency translation adjustment				(2)		(2)
Net loss					(2,464)	(2,464)
Balance at end of period at Mar. 31, 2019	$ 16,746		2,326		(18,018)	(15,692)
Balance at end of period (shares) at Mar. 31, 2019	4,801,020	5,166,812
Balance at beginning of period at Dec. 31, 2018	$ 16,746		2,266	2	(15,554)	(13,286)
Balance at beginning of period (shares) at Dec. 31, 2018	4,801,020	5,166,812
Increase (Decrease) in Stockholders' Equity
Net loss						(7,986)
Balance at end of period at Sep. 30, 2019	$ 40,912		2,459		(23,540)	(21,081)
Balance at end of period (shares) at Sep. 30, 2019	8,264,613	5,166,812
Balance at beginning of period at Mar. 31, 2019	$ 16,746		2,326		(18,018)	(15,692)
Balance at beginning of period (shares) at Mar. 31, 2019	4,801,020	5,166,812
Increase (Decrease) in Stockholders' Equity
Issuance of common stock in exchange for process research and development	$ 24,166
Issuance of common stock in exchange for process research and development (in shares)	3,463,593
Stock–based compensation			79			79
Foreign currency translation adjustment				11		11
Net loss					(1,901)	(1,901)
Balance at end of period at Jun. 30, 2019	$ 40,912		2,405	11	(19,919)	(17,503)
Balance at end of period (shares) at Jun. 30, 2019	8,264,613	5,166,812
Increase (Decrease) in Stockholders' Equity
Stock–based compensation			54			54
Foreign currency translation adjustment				(11)		(11)
Net loss					(3,621)	(3,621)
Balance at end of period at Sep. 30, 2019	$ 40,912		2,459		(23,540)	(21,081)
Balance at end of period (shares) at Sep. 30, 2019	8,264,613	5,166,812
Balance at beginning of period at Dec. 31, 2019		$ 16	49,130	12	(36,866)	12,292
Balance at beginning of period (shares) at Dec. 31, 2019		15,592,718
Increase (Decrease) in Stockholders' Equity
Exercise of stock options			53			53
Exercise of stock options (in shares)		84,589
Stock–based compensation			159			159
Foreign currency translation adjustment				(34)		(34)
Net loss					(4,730)	(4,730)
Balance at end of period at Mar. 31, 2020		$ 16	49,342	(22)	(41,596)	7,740
Balance at end of period (shares) at Mar. 31, 2020		15,677,307
Balance at beginning of period at Dec. 31, 2019		$ 16	49,130	12	(36,866)	$ 12,292
Balance at beginning of period (shares) at Dec. 31, 2019		15,592,718
Increase (Decrease) in Stockholders' Equity
Exercise of stock options (in shares)						84,589
Net loss						$ (10,168)
Balance at end of period at Sep. 30, 2020		$ 17	56,526	(3)	(47,034)	9,506
Balance at end of period (shares) at Sep. 30, 2020		16,427,307
Balance at beginning of period at Mar. 31, 2020		$ 16	49,342	(22)	(41,596)	7,740
Balance at beginning of period (shares) at Mar. 31, 2020		15,677,307
Increase (Decrease) in Stockholders' Equity
Issuance of common stock in connection with equity financing		$ 1	7,499			7,500
Issuance of common stock in connection with equity financing (in shares)		750,000
Transaction costs in connection with equity financing			(984)			(984)
Stock–based compensation			171			171
Issuance of broker warrants in connection with equity financing			289			289
Foreign currency translation adjustment				6		6
Net loss					(2,384)	(2,384)
Balance at end of period at Jun. 30, 2020		$ 17	56,317	(16)	(43,980)	12,338
Balance at end of period (shares) at Jun. 30, 2020		16,427,307
Increase (Decrease) in Stockholders' Equity
Stock–based compensation			209			209
Foreign currency translation adjustment				13		13
Net loss					(3,054)	(3,054)
Balance at end of period at Sep. 30, 2020		$ 17	$ 56,526	$ (3)	$ (47,034)	$ 9,506
Balance at end of period (shares) at Sep. 30, 2020		16,427,307

Condensed Consolidated Statements of Cash Flows - USD ($) shares in Thousands, $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Operating activities
Net loss	$ (10,168)	$ (7,986)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation	539	193
Non cash interest related to convertible notes - related party		45
Depreciation	34	5
Non-cash lease expense	16	5
Change in assets and liabilities, net of the effects of the reverse asset acquisition:
Prepaid expenses and other assets	(351)	875
Accounts payable	460	475
Accrued and other liabilities	1,054	627
Net cash used in operating activities	(8,416)	(5,761)
Investing activities
Purchases of property and equipment	(2)	(118)
Net cash used in investing activities	(2)	(118)
Financing activities
Proceeds from issuance of common stock and redeemable convertible preferred stock	7,500	24,240
Exercise of stock options	53
Issuance costs	(695)	(74)
Net cash provided by financing activities	6,858	24,166
Net (decrease) increase in cash and restricted cash	(1,560)	18,287
Net foreign exchange difference	(10)	(7)
Cash and restricted cash at beginning of period	13,923	2,845
Cash and restricted cash at end of period	$ 12,353	21,125
Supplemental non-cash financing transactions:
Placement warrants issued in connection with equity financing	289
Unpaid fixed asset purchases	$ 2
Operating lease right-of-use asset obtained in exchange for operating lease		$ 128

The Company and Basis of Presentation

9 Months Ended

Sep. 30, 2020

The Company and Basis of Presentation

The Company and Basis of Presentation

1. The Company and Basis of Presentation

NeuroBo Pharmaceuticals, Inc. (together with its subsidiaries, the "Company" or "NeuroBo"), formerly known as Gemphire Therapeutics Inc. (“Gemphire”), is a clinical-stage biotechnology company with three therapeutics programs designed to impact a range of indications in neurodegenerative and cardiometabolic disease:

NB-01, which is primarily focused on the development of a treatment for painful diabetic neuropathy, but which the Company believes could also treat a range of neuropathic conditions, including chemotherapy-induced peripheral neuropathy and post-traumatic peripheral neuropathy;

NB-02, which has the potential to treat the symptoms of cognitive impairment and modify the progression of neurodegenerative diseases associated with the malfunction of a protein called tau, and with amyloid beta plaque deposition; and

Gemcabene, which is focused on developing and commercializing therapies for the treatment of dyslipidemia, a serious medical condition that increases the risk of life-threatening cardiovascular disease, focused on orphan indications such as homozygous familial hypercholesterolemia, as well as nonalcoholic fatty liver disease/nonalcoholic steatohepatitis.

The Company was originally incorporated as Gemphire Therapeutics Inc. In connection with the closing of the Merger (as defined below), the Company changed its name to NeuroBo Pharmaceuticals, Inc. The Company’s operations have consisted principally of performing research and development activities, clinical development and raising capital. The Company's activities are subject to significant risks and uncertainties, including failing to secure additional funding before sustainable revenues and profit from operations are achieved.

COVID-19

The Company is subject to risks and uncertainties as a result of the COVID-19 pandemic. The extent of the impact of the COVID-19 pandemic on the Company’s business is highly uncertain and difficult to predict, as the responses that the Company, other businesses and governments are taking continue to evolve. Furthermore, capital markets and economies worldwide have also been negatively impacted by the COVID-19 pandemic, and it is possible that it could cause a lasting national and/or global economic recession. Policymakers around the globe have responded with fiscal policy actions to support the healthcare industry and economy as a whole. The magnitude and overall effectiveness of these actions remain uncertain.

To date, except for the adjustments to scientific activity described under “Current Scientific Activity” below, the Company has not experienced any significant changes in our business that would have a significant negative impact on our consolidated statements of operations or cash flows.

The severity of the impact of the COVID-19 pandemic on the Company’s business will depend on a number of factors, including, but not limited to, the duration and severity of the pandemic and the extent and severity of the impact on the Company’s service providers, suppliers, contract research organizations and the Company’s clinical trials, all of which are uncertain and cannot be predicted. As of the date of issuance of Company’s financial statements, the extent to which the COVID-19 pandemic may in the future materially impact the Company’s financial condition, liquidity or results of operations is uncertain.

Current Scientific Activity

In light of the present business environment, including the impact of the COVID-19 pandemic, the Company is currently conducting the scientific activities described below with a view toward conserving financial resources.

NB-01. For NB-01, the Company has determined that any attempt to conduct Phase 3 clinical trials, as previously announced, would be difficult if not impossible in the short or medium term. Accordingly, in the first quarter of 2020, the Company directed its contract research organization (“CRO”) partners and other vendors working on the Phase 3 clinical trials of NB-01 to cease all work and the Company terminated its existing contract arrangements with each of them.

The Company is currently evaluating its options regarding the NB-01 asset:

Orphan drug. Development of NB-01 as an orphan drug is among the alternatives the Company is considering. The Company has identified one potential rare disease indication for NB-01, but the Company has not yet conducted feasibility studies for it. The Company believes that development for such indication would depend on its ability to renegotiate milestone payments under its exclusive license agreement with Dong-A ST to reflect the potential revenue from such indication.

Nutraceutical. The Company has considered marketing NB-01 as a nutraceutical (non-pharmaceutical) product, and the Company may re-explore this pathway if the identified rare disease indication for NB-01 does not proceed.

NB-02. During the third quarter of 2020, the Company continued work on preparing an Investigational New Drug (“IND”) application to the U.S. Food and Drug Administration (“FDA”) for NB-02. In order to preserve operating capital, the Company has postponed continued work on the IND and the first human clinical trials for NB-02 until global health and macroeconomic conditions improve, with a view toward commencing clinical trial activity in the second half of 2021, subject to improvement of the constraints imposed by the COVID-19 pandemic. The Company is also considering engaging with a strategic partner to assist with clinical trials for NB-02.

Gemcabene. In May 2020, the Company received written communication from the U.S. Food and Drug Administration (“FDA”) that the clinical development program for Gemcabene remains on a partial clinical hold. The Company continues to review its options regarding Gemcabene.

Merger

On July 24, 2019, Gemphire Therapeutics Inc. (“Gemphire”), and NeuroBo Pharmaceuticals, Inc. (“Private NeuroBo”) entered into a definitive agreement, which was amended on October 29, 2019 (the “Merger Agreement”). The merger closed on December 30, 2019 (the “Effective Date”), whereby Private NeuroBo merged with a wholly-owned subsidiary of the Company in an all-stock transaction (the “Merger”).

Upon completion of the Merger, the Company changed its name to NeuroBo Pharmaceuticals, Inc., Private NeuroBo changed its name to NeuroBo Therapeutics, Inc., and the Company changed its ticker symbol on the Nasdaq Capital Market from “GEMP” to "NRBO". Except as otherwise indicated, references herein to “NeuroBo,” “the Company,” the “combined company,” “we,” “us,” and “our,” refer to NeuroBo Pharmaceuticals, Inc. on a post-Merger basis.

Pursuant to the terms of the Merger Agreement, each outstanding share of Private NeuroBo common stock outstanding immediately prior to the closing of the Merger was converted into 1.1431 shares of the Company’s common stock (the “Exchange Ratio”). Immediately prior to the closing of the Merger, all shares of Private NeuroBo redeemable preferred stock then outstanding were exchanged into shares of common stock of Private NeuroBo. In addition, all outstanding options exercisable for common stock of Private NeuroBo converted into options exercisable for shares of the Company’s common stock upon the Merger. Such options and their related terms were adjusted by the Exchange Ratio. Immediately following the Merger, the stockholders of Private NeuroBo owned approximately 96.2% of the outstanding common stock of the Company.

The transaction was accounted for as a reverse asset acquisition in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Under this method of accounting, Private NeuroBo was deemed to be the accounting acquirer for financial reporting purposes. This determination was primarily based on the facts that, immediately following the Merger: (i) Private NeuroBo’s stockholders owned substantially all of the voting rights in the combined company, (ii) Private NeuroBo designated all, but one, of the members of the initial board of directors of the combined company, and (iii) Private NeuroBo’s senior management holds all key positions in the senior management of the combined company. As a result, as of the closing date of the Merger, the net assets of Gemphire were recorded at their acquisition-date relative fair values in the consolidated financial statements of the Company and the reported operating results prior to the Merger are those of Private NeuroBo.

Basis of presentation and consolidation principles

The accompanying condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The condensed consolidated financial statements may not include all disclosures required by GAAP; however, the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited condensed financial statements should be read in conjunction with the audited financial statements and the notes thereto for the fiscal year ended December 31, 2019 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 30, 2020. The condensed consolidated balance sheet at December 31, 2019 was derived from the audited financial statements.

In the opinion of management, all adjustments, consisting of only normal recurring adjustments that are necessary to present fairly the financial position, results of operations, and cash flows for the interim periods, have been made. The results of operations for the interim periods are not necessarily indicative of the operating results for the full fiscal year or any future periods.

On August 11, 2019, Private NeuroBo’s board of directors and stockholders approved an amendment to the restated certificate of incorporation to affect a ten thousand-for-one (10,000-for-1) stock split of Private NeuroBo's common stock and convertible preferred stock. The par value and the authorized shares of the common and convertible preferred stock and the exercise prices of options to purchase common stock were adjusted accordingly as a result of the stock split. All issued and outstanding common stock, options for common stock, convertible preferred stock and convertible notes, as well as the exercise price of each option for common stock and the conversion price for convertible preferred stock and convertible notes, have been retroactively adjusted to reflect this stock split for all periods presented.

All of the share and per share amounts presented were adjusted, on a retroactive basis, to reflect the ten thousand-for-one (10,000-for-1) stock split and the effect of the exchange of the shares of Private NeuroBo into the shares of the Company at the Exchange Ratio, except for par value and share authorizations of Private NeuroBo for periods presented prior to the Merger.

The condensed consolidated financial statements of the Company include a South Korean subsidiary, NeuroBo Co., LTD., which is fully owned by the Company. All significant intercompany accounts and transactions have been eliminated in the preparation of the financial statements.

Going Concern

From its inception through September 30, 2020, the Company has devoted substantially all of its efforts to drug discovery and development and conducting clinical trials. The Company has a limited operating history and the sales and income potential of the Company's business and market are unproven. Successful transition to attaining profitable operations is dependent upon achieving a level of revenues adequate to support the Company's cost structure. As of September 30, 2020, the Company had $12.4 million in cash. The Company has experienced net losses and negative cash flows from operating activities since its inception and had an accumulated deficit of $47.0 million as of September 30, 2020.

To date, the Company has raised capital principally through the issuance of common stock, convertible notes and private placements of redeemable convertible preferred stock. The Company has raised a total of $16.8 million from the issuance by Private NeuroBo of Series A redeemable convertible preferred stock and $0.5 million from the issuance by Private NeuroBo of convertible notes through December 31, 2018, and $24.2 million from the issuance by Private NeuroBo of Series B redeemable convertible preferred stock in May and June 2019. On April 13, 2020, the Company entered into a Securities Purchase Agreement, pursuant to which the Company agreed to issue and sell, in a registered direct offering (the “Registered Offering”), 750,000 shares of common stock at an offering price of $10 per share. The Registered Offering resulted in gross proceeds of $7.5 million. The Company will need to continue to raise a substantial amount of funds until it is able to generate revenues to fund its development activities.

The determination as to whether the Company can continue as a going concern contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company expects to continue to incur net losses and negative cash flows from operations into the foreseeable future. Successful transition to attaining profitable operations is dependent upon achieving a level of revenues adequate to support the Company's cost structure. The Company has incurred net losses since inception and has relied on its ability to fund its operations through debt and equity financings. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty. This basis of accounting contemplates the recovery of the Company's assets and the satisfaction of liabilities in the normal course of business.

The Company believes that its existing cash will be sufficient to fund its operations into the third quarter of 2021 at the level of scientific activity described above under “Current Scientific Activity”. The Company plans to continue to fund its operations and capital funding needs through a combination of equity offerings, debt financings, or other sources, potentially including collaborations, licenses and other similar arrangements. There can be no assurance that the Company will be able to obtain any sources of financing on acceptable terms, or at all. To the extent that the Company can raise 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 its business.

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2020

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Use of estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, expenses, and related disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. The most significant estimates in the Company's consolidated financial statements relate to accrued expenses and the fair value of stock-based compensation and warrant issuances. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgements about the carrying values of assets and liabilities. Actual results could differ from those estimates. Changes in estimates are reflected in reported results in the period in which they become known.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash. The Company’s cash is principally held by one financial institution in the United States. Amounts on deposit may at times exceed federally insured limits. Management believes that the financial institution is financially sound, and accordingly, minimal credit risk exists with respect to the financial institution. As of September 30, 2020, the Company had deposits in excess of federally insured amounts by $11.8 million.

Fair Value of Financial Instruments

The Company’s financial instruments include principally cash, prepaid, other current assets, right of use assets, accounts payable, accrued liabilities, lease liabilities, convertible debt and preferred stock. The carrying amounts of prepaid expenses, accounts payable, and accrued liabilities are reasonable estimates of their fair value because of the short maturity of these items.

General and Administrative Expenses

General and administrative expenses consist primarily of personnel‑related costs, including salaries and stock-based compensation costs, for personnel in functions not directly associated with research and development activities. Other significant costs include legal fees related to intellectual property and corporate matters and professional fees for accounting and other services.

Research and Development Costs

Research and development costs are charged to expense as incurred. Research and development expenses are comprised of costs incurred in performing research and development activities, including clinical trial costs, manufacturing costs for both clinical and pre-clinical materials as well as other contracted services, license fees, and other external costs. Nonrefundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity is performed or when the goods have been received, rather than when payment is made, in accordance with Accounting Standards Codification (“ASC”) 730, Research and Development.

Income Taxes

The Company utilizes the liability method of accounting for income taxes as required by ASC 740, Income Taxes. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and the tax basis of assets and liabilities and are measured using enacted tax rates and laws that will be in effect when the differences are expected to reverse. Currently, there is no provision for income taxes, as the Company has incurred operating losses to date, and a full valuation allowance has been provided on the net deferred tax assets.

Stock‑Based Compensation

The Company accounts for stock‑based compensation in accordance with the provisions of ASC 718, Compensation — Stock Compensation (“ASC 718”). Accordingly, compensation costs related to equity instruments granted are recognized at the grant‑date fair value. The Company records forfeitures when they occur. Stock-based compensation arrangements to non‑employees are accounted for in accordance with the applicable provisions of ASC 718 using a fair value approach.

Convertible Notes

The Company evaluates all conversion and redemption features contained in a debt instrument to determine if there are any embedded features that require bifurcation as a derivative or separation as a beneficial conversion feature. The host debt instrument is discounted for the value of any embedded feature that is accounted for as either a derivative or a beneficial conversion feature. The discount is amortized and recorded to interest expense over the term of the host debt instrument using the effective interest method. The Company’s convertible debt contained an embedded beneficial conversion feature that was separated and recorded as additional paid-in capital.

Fair Value of common stock

In the absence of a public trading market prior to the Merger, and as a development stage company with no significant revenues, the Company believed that it was appropriate to consider a range of factors to determine the fair value of the common stock at each grant date. In determining the fair value of its common stock, the Company used methodologies, approaches, and assumptions consistent with the American Institute of Certified Public Accountants' (“AICPA”) Audit and Accounting Practice Aid Series: Valuation of Privately Held Company Equity Securities Issued as Compensation (the "AICPA Practice Guide"). The valuations of Private NeuroBo common stock were prepared using a hybrid method, which used market approaches to estimate the enterprise value of Private NeuroBo. The hybrid method is a probability-weighted expected return method ("PWERM"), where the equity value in one or more of the scenarios is calculated using an option pricing method ("OPM"). The PWERM is a scenario-based methodology that estimates the fair value of common stock based upon an analysis of future values for Private NeuroBo, assuming various outcomes. The common stock value was based on the probability-weighted present value of expected future investment returns considering each of the possible outcomes available as well as the rights of each class of stock. The future value of the common stock under each outcome was discounted back to the valuation date at an appropriate risk-adjusted discount rate and probability weighted to arrive at an indication of value for the common stock. A discount for lack of marketability of the common stock was then applied to arrive at an indication of value for the common stock. The OPM treats common stock and preferred stock as call options on the total equity value of a company, with exercise prices based on the value thresholds at which the allocation among the various holders of a company's securities changes. Under this method, the common stock has value only if the funds available for distribution to stockholders exceeded the value of the preferred stock liquidation preferences at the time of the liquidity event, such as a strategic sale or a merger. In addition, the Company considered various objective and subjective factors, along with input from an independent third-party valuation firm. The factors included (1) the achievement of technical and operational milestones by the Company; (2) the status of strategic relationships with collaborators; (3) the significant risks associated with the Company's stage of development; (4) capital market conditions for life science companies and, in particular, similarly situated, privately held, early-stage life science companies; (5) the Company's available cash, financial condition, and results of operations; (6) the most recent sales of the Company's preferred stock to the extent they were with outside parties; and (7) the preferential rights of the outstanding preferred stock.

Leases

On July 1, 2019, the Company adopted Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842) (“ASU 2016-02”). The Company assesses its contracts at inception to determine whether the contract contains a lease, including evaluation of whether the contract conveys the right to control an explicitly or implicitly identified asset for a period of time. The Company has recognized right-of-use assets and lease liabilities that represent the net present value of future operating lease payments utilizing a discount rate corresponding to the Company’s incremental borrowing rate and amortized over the remaining terms of the leases. For operating leases of a short-term nature, i.e., those with a term of less than twelve months, the Company recognizes lease payments as an expense on a straight-line basis over the remaining lease term.

Property and Equipment

Property and equipment is recorded at cost and reduced by accumulated depreciation. Depreciation expense is recognized over the estimated useful lives of the assets using the straight-line method. The estimated useful life for property and equipment ranges from three to five years. Tangible assets acquired for research and development activities and that have an alternative use are capitalized over the useful life of the acquired asset. Estimated useful lives are periodically reviewed, and when appropriate, changes are made prospectively. When certain events or changes in operating conditions occur, asset lives may be adjusted and an impairment assessment may be performed on the recoverability of the carrying amounts. Maintenance and repairs are charged directly to expense as incurred.

Foreign Currency Translation

The foreign subsidiary uses the local currency as the functional currency. The Company translates the assets and liabilities of its foreign operation into U.S. dollars based on the rates of exchange in effect as of the balance sheet date. Expenses are translated into U.S. dollars using average exchange rates for each period. The resulting adjustments from the translation process are included in accumulated other comprehensive (loss) income in the accompanying condensed consolidated balance sheets.

Certain transactions of the Company are settled in foreign currency and are thus translated to U.S. dollars at the rate of exchange in effect at the end of each month. Gains and losses resulting from the translation are included in other income or expense in the accompanying condensed consolidated statements of operations and comprehensive loss.

Patent Costs

Costs related to filing and pursuing patent applications are expensed as incurred, as recoverability of such expenditures is uncertain. These costs are included in general and administrative expenses.

Comprehensive Loss

Comprehensive loss is comprised of net loss and other comprehensive income or loss. Comprehensive loss includes net loss as well as other changes in stockholders' equity (deficit) that result from transactions and economic events other than those with stockholders. Comprehensive loss currently consists of net loss and changes in foreign currency translation adjustments.

Segment Information

Operating segments are components of an enterprise for which separate financial information is available and is evaluated regularly by the Company’s chief operating decision maker in deciding how to allocate resources and assessing performance. The Company’s chief operating decision maker is its Chief Executive Officer. The Company’s Chief Executive Officer views the Company’s operations and manages its business in one operating segment, which is principally the business of development and commercialization of therapeutics.

Recent Accounting Pronouncements Adopted

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its consolidated financial position or results of operations upon adoption.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement (ASU 2018-13). The new guidance modifies the disclosure requirements in Topic 820 as follows:

Removals: the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy; the policy for timing of transfers between levels; and the valuation processes for Level 3 fair value measurements.

Modifications: for investments in certain entities that calculate net asset value, an entity is required to disclose the timing of liquidation of an investee’s assets and the date when restrictions from redemption might lapse only if the investee has communicated the timing to the entity or announced the timing publicly; and the amendments clarify that the measurement uncertainty disclosure is to communicate information about the uncertainty in measurement as of the reporting date.

Additions: the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period; and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements.

This guidance is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should all be applied prospectively for only the most recent interim or annual period presented in the initial year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted. The Company adopted the new guidance on January 1, 2020. The guidance did not have a material impact on the consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) which amends the existing guidance relating to the accounting for income taxes. This ASU is intended to simplify the accounting for income taxes by removing certain exceptions to the general principles of accounting for income taxes and to improve the consistent application of GAAP for other areas of accounting for income taxes by clarifying and amending existing guidance. The ASU is effective for fiscal years beginning after December 15, 2020. The Company does not expect that the adoption of this new guidance will have a material impact on the Company’s consolidated financial statements.

In August 2020, FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which, among other things, provides guidance on how to account for contracts on an entity’s own equity. This ASU eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. It also amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, this ASU modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation. The amendments in this ASU are effective for smaller reporting companies as defined by the SEC for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. The Company is currently evaluating the impact of ASU 2020-06 on its consolidated financial statements.

Balance Sheet Detail

9 Months Ended

Sep. 30, 2020

Balance Sheet Detail

Balance Sheet Detail

3. Balance Sheet Detail (in thousands)

Property and Equipment

Property and equipment consist of the following:


	As of
	September 30,		December 31,
	2020		2019
Research and development equipment	$	158	$	158
Office equipment		60		59
Total property and equipment		218		217
Less accumulated depreciation		(51)		(17)
Property and equipment, net	$	167	$	200

Depreciation expense was $12 and $5 for the three months ended September 30, 2020 and 2019, respectively, and $34 and $5 for the nine months ended September 30, 2020 and 2019, respectively.

Accrued liabilities

Accrued liabilities consist of the following as of:


	September 30,		December 31,
	2020		2019
External research and development expenses	$	2,072	$	915
Professional services		209		158
Payroll related		176		160
Other		34		189
Total	$	2,491	$	1,422

In the first quarter of 2020, the Company directed its contract research organization (“CRO”) partners and other vendors working on the Phase 3 clinical trials of NB-01 to cease all work and has terminated its existing contract arrangements with each of them. The Company incurred termination expenses of approximately $1,300 in connection with these terminations which are included in the external research and development expenses line item in the above table. In the third quarter of 2020, our previous dispute with one CRO relating to termination charges was settled for $700 and is included in the external research and development expenses line item in the above table.

During the three months ended March 31, 2020, the Company recorded adjustments to research and development expenses related to clinical trial expenses that were not correctly recorded in prior periods. The net adjustments resulted in an increase of $186 in the Company’s net loss for the nine month period ended September 30, 2020, which the Company considers immaterial to all periods.

Commitments and Contingencies

9 Months Ended

Sep. 30, 2020

Commitments and Contingencies

Commitments and Contingencies

5. Commitments and Contingencies (in thousands)

Operating Leases

Boston Leases

In April 2018, the Company entered a non-cancelable operating lease for its headquarters in Boston, MA (the “Boston Lease”). The lease was subsequently amended, and the term was extended to August 2019 with an option to extend the term on a month-to-month basis. The Company exercised the option and extended the lease term on a month-to-month basis through January 15, 2020. The lease was subject to base lease payments and additional charges for common costs related to usage of shared space. Due to its short-term nature, the Company recognized lease payments as an expense on a straight-line basis over the remaining lease term.

In September 2019, the Company entered a non-cancelable operating lease, as amended, for its new corporate headquarters located in Boston, Massachusetts (“New Boston Lease”). The agreement, effective February 1, 2020, has a one-year term, and rental costs of $21 per month prior to the application of certain rent concessions granted by the landlord in the amount of $32.

For the three and nine months ended September 30, 2020, expense under the New Boston Lease and Boston Lease in the aggregate was $64 and $244, inclusive of a termination fee of $83, respectively. For the three and nine months ended September 30, 2019, expense under the Boston Lease in the aggregate was $40 and $93, respectively.

Future minimum lease payments at September 30, 2020 were as follows under the New Boston Lease (in thousands):


	December 31,

2020 (period from October 1 to December 31)	$	64
2021		21
Total minimum payments	$	85

Lease in Korea:

In May 2019, the Company entered a non-cancelable operating lease for its new facility in Korea (the “Korea Lease”). The initial lease term is five years with an option to renew for an additional five-year term. The lease commenced on July 2, 2019 and expires on July 1, 2024. The operating lease is subject to a deposit, base rent payments and additional charges for utilities and other common costs. In the third quarter of 2019, the Company recognized a right-of-use asset of $126 as well as a lease liability of $20 in other current liabilities and $106 in other non-current liabilities in conjunction with the commencement of the Korea Lease. The Company’s lease liability represents the net present value of future lease payments utilizing a discount rate of 10%, which corresponds to the Company’s incremental borrowing rate. As of September 30, 2020, the weighted average remaining lease term was 3.75 years. For the three and nine month periods ended September 30, 2020, the Company recorded non-cash expense of $8 and $24, respectively, related to the Korea Lease. During the nine month period ended September 30, 2020, the Company made cash payments of $24 for amounts included in the measurement of lease liabilities. During the three and nine month periods ended September 30, 2019, Company recorded non-cash expense of $5 and made a cash payment of $8 under the Korea Lease.

The following table reconciles the undiscounted lease liabilities to the total lease liabilities recognized on the consolidated balance sheet as of September 30, 2020 (in thousands):



	December 31,
2020 (period from October 1 to December 31)	$	8
2021		32
2022		32
2023		32
2024		16
Total lease payments		120
Less effect of discounting		(20)
Total		100
Short-term portion		(23)
Long-term portion	$	77

Xiehecheng Cultivation Service Agreement

On September 1, 2018 and as amended on October 1, 2020, the Company entered into a cultivation service agreement with Xiehecheng Chinese Herm Limited Corporation for the cultivation of two plants used to manufacture the Company's clinical assets.

As of September 30, 2020, future minimum payments under the agreement, which is cancellable annually at the end of each research year, are as follows (in thousands):


		December 31,

2020	(period from October 1 to December 31)	$	66
2021			220
2022			220
		$	506

Pfizer License Agreement

Upon the close of the Merger, the exclusive license agreement with Pfizer Inc. (“Pfizer”) for the clinical product candidate Gemcabene (the “Pfizer Agreement”) was assumed by the Company. Under the Pfizer Agreement, in exchange for this worldwide exclusive right and license to certain patent rights to make, use, sell, offer for sale and import the clinical product Gemcabene, the Company has agreed to certain milestone and royalty payments on future sales.

The Company agreed to make milestone payments totaling up to $37 million upon the achievement of certain milestones, including the first new drug application (or its foreign equivalent) in any country, regulatory approval in each of the United States, Europe and Japan, the first anniversary of the first regulatory approval in any country, and upon achieving certain aggregate sales levels of Gemcabene. Future milestone payments under the Pfizer Agreement, if any, are not expected to begin for at least several years and extend over a number of subsequent years.

The Company also agreed to pay Pfizer tiered royalties on a country‑by‑country basis based upon the annual amount of net sales, as specified in the Pfizer Agreement, until the later of: (a) five (5) years after the first commercial sale in such country; (b) the expiration of all regulatory or data exclusivity for Gemcabene in such country; and (c) the expiration or abandonment of the last valid claim of the licensed patents, including any patent term extensions or supplemental protection certificates in such country (collectively, the Royalty Term). Under the Pfizer Agreement, the Company is obligated to use commercially reasonable efforts to develop and commercialize Gemcabene.

None of the future milestone or royalty payments were triggered through September 30, 2020.

The Pfizer Agreement will expire upon expiration of the Royalty Term. On expiration (but not earlier termination), the Company will have a perpetual, exclusive, fully paid-up, royalty-free license under the licensed patent rights and related data to make, use, develop, commercialize, import and otherwise exploit the clinical product candidate Gemcabene. Either party may terminate the Pfizer Agreement for the other party’s material breach following a cure period or immediately upon certain insolvency events relating to the other party. Pfizer may immediately terminate the Pfizer Agreement in the event that (i) the Company or any of its affiliates or sublicenses contests or challenges, or supports or assists any third party to contest or challenge, Pfizer’s ownership of or rights in, or the validity, enforceability or scope of any of the patents licensed under the Pfizer Agreement or (ii) the Company or any of its affiliates or sublicensees fails to achieve the first commercial sale in at least one country by April 16, 2024.

Furthermore, upon termination of the Pfizer Agreement by Pfizer for any of the foregoing reasons, the Company grants Pfizer a non-exclusive, fully paid-up, royalty free, worldwide, transferrable, perpetual and irrevocable license to use any intellectual property rights arising from the development or commercialization of Gemcabene by the Company and any trademarks identifying Gemcabene and agrees to transfer regulatory filings and approvals to Pfizer or permit Pfizer to cross-reference and rely on such regulatory filings and approvals for Gemcabene. The Company may terminate the Pfizer Agreement for convenience upon 90 days’ written notice and payment of an early termination fee of $3.0 million.

As of September 30, 2020 and December 31, 2019, there was sufficient uncertainty with regard to both the outcome of the clinical trials and the ability to obtain sufficient funding to support any of the cash milestone payments under the license agreement, and as such, no liabilities were recorded related to the Pfizer Agreement.

Contingencies

From time to time, the Company may be subject to various claims and suits arising in the ordinary course of business. The Company does not expect that the resolution of these matters will have a material adverse effect on its financial position or results of operations.

License Agreement	9 Months Ended
License Agreement	Sep. 30, 2020
License Agreement
License Agreement	6. License Agreement Beijing SL License and Collaboration Agreement Upon the close of the Merger, the License and Collaboration Agreement (the “Beijing SL Agreement”) with Beijing SL Pharmaceutical Co., Ltd. (“Beijing SL”) was assumed by the Company, pursuant to which the Company granted Beijing SL an exclusive royalty-bearing license to research, develop, manufacture and commercialize pharmaceutical products comprising, as an active ingredient, Gemcabene in mainland China, Hong Kong, Macau and Taiwan (each, a “region,” and collectively, the “Territory”). The terms of the agreement include payments based upon achievement of milestones and royalties on net product sales. Under the Beijing SL Agreement, the Company has variable consideration in the form of milestone payments. As of September 30, 2020, no revenue under the Beijing SL Agreement has been recognized. Under the terms of the Beijing SL Agreement, Beijing SL will be responsible, at its expense, for developing and commercializing products containing Gemcabene (each, a “Licensed Product”) in the Territory, with certain assistance from the Company. To the extent mutually agreed to in writing, the Company and Beijing SL will collaborate on the Phase 3 clinical trial for homozygous familial hypercholesterolemia or other clinical trials with the Company as the sponsor designed to enroll patients both inside and outside the Territory (a “Global Study”), but Beijing SL will be responsible, at its expense, for the conduct of any Global Study to the extent solely in the Territory, subject to the Company’s final decision making authority, and the Company will be responsible, at its expense, for the conduct of any Global Study to the extent solely outside of the Territory. Under a territory development plan, the parties shall develop Licensed Products with respect to the Territory. Beijing SL will be responsible for development activities, including non-clinical and clinical studies directed at obtaining regulatory approval of the Licensed Product in the Territory. Beijing SL has agreed to use commercially reasonable efforts to commercialize the Licensed Products for each indication that receives regulatory approval in the Territory and shall prepare and present a commercialization plan that shall be subject to approval by the joint steering committee. Pursuant to the Beijing SL Agreement, Beijing SL was to make a non-refundable upfront gross payment of $2.5 million to the Company within 45 days of the effective date of the Beijing SL Agreement; the upfront payment was received in October 2019 and such funds were fully expended prior to the close of Merger. Additionally, with respect to each Licensed Product, the Company is eligible to receive (i) payments for specified developmental and regulatory milestones (including submission of a new drug application to China’s National Medical Product Administration, dosing of the first patient in a phase 3 clinical trial in mainland China and regulatory approval for the first and each additional indication of a Licensed Product in the Territory) totaling up to $6 million in the aggregate and (ii) payments for specified global net sales milestones of up to $20 million in the aggregate multiplied by the ratio of the net sales of a Licensed Product sold by Beijing SL in the Territory divided by the global net sales of a Licensed Product, which net sales milestone payments are payable once, upon the first achievement of such milestone. Beijing SL is also obligated to pay the Company tiered royalties ranging from the mid-teens to twenty percent on the net sales of all Licensed Products in the Territory until the latest of (a) the date on which any applicable regulatory exclusivity with respect to such Licensed Product expires in such region, (b) the expiration or abandonment of the last valid patent claim or joint patent claim covering such Licensed Product in each region and (c) the fifth anniversary of the first commercial sale of such Licensed Product in such region (the “Royalty Term”). Future milestone payments under the Beijing SL Agreement, if any, are not expected to begin for at least one year and will extend over a number of subsequent years. The Company cannot determine the date on which Beijing SL’s potential royalty payment obligations to the Company would expire because Beijing SL has not yet developed any Licensed Products under the Beijing SL Agreement and therefore the Company cannot at this time identify the date of the first commercial sale or the periods of any regulatory exclusivity or patent claims with respect to any Licensed Product. On a Licensed Product-by-Licensed Product and region-by-region basis upon the expiration of the Royalty Term, the license granted to Beijing SL shall be deemed perpetual, fully paid-up and royalty free with respect to such Licensed Product in such region. Either party may terminate the Agreement (x) with written notice in the event of the other party’s material breach following a cure period or (y) if the other party becomes subject to certain insolvency proceedings. In addition, the Company may terminate the agreement in its entirety if Beijing SL or its affiliates or sublicensees commence a proceeding challenging the validity, enforceability or scope of any of the Company’s patents. To the extent rights granted to Beijing SL under the Beijing SL Agreement are controlled by the Company pursuant to the Pfizer Agreement, such rights are subject to the terms and conditions of such agreement with Pfizer, and Beijing SL has agreed to comply with such terms and conditions. The Beijing SL Agreement contemplates that Beijing SL and the Company shall, no later than twelve months prior to the anticipated date of the first commercial sale of a Licensed Product, if any, negotiate in good faith and execute a commercial supply agreement, pursuant to which Beijing SL shall purchase from the Company, and the Company shall use commercially reasonable efforts to supply, Gemcabene or Licensed Product for clinical or commercial purposes, as applicable, until manufacturing and regulatory transfers are complete. Each of the Company and Beijing SL has agreed to indemnify the other party against certain losses and expenses relating to the development or commercialization of a Licensed Product by the indemnifying party, the negligence or willful misconduct of the indemnifying party or its directors, officers, employees or agents or a breach of the indemnifying party’s representations, warranties or covenants.

Stockholders’ Equity (Deficit)

9 Months Ended

Sep. 30, 2020

Stockholders’ Equity

Stockholders’ Equity (Deficit)

8. Stockholders’ Equity (Deficit)

Common Stock

The voting, dividend, and liquidation rights of the holders of the common stock are subject to and qualified by the rights, powers, and preferences of the holders of the preferred stock when outstanding. The holders of the common stock are entitled to one vote for each share of common stock held at all meetings of stockholders.

Dividend Rights

Common stock holders are entitled to receive dividends at the sole discretion of the board of directors of the Company. There have been no dividends declared on common stock as of September 30, 2020.

Voting Rights

The holders of common stock are entitled to one vote for each share of common stock along with all other classes and series of stock of the Company on all actions to be taken by the stockholders of the Company, including actions that would amend the certificate of incorporation of the Company to increase the number of authorized shares of the common stock.

Liquidation Rights

In the event of any liquidation, dissolution, or winding‑up of the Company, the holders of common stock shall be entitled to share in the remaining assets of the Company available for distribution post preferential distributions made to holders of the Company’s preferred stock.

April 2020 Equity Financing

On April 13, 2020, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with an institutional investor, pursuant to which the Company sold, in a registered direct offering (the “Registered Offering”), 750,000 shares (the “Shares”) of the Company’s common stock at an offering price of $10 per share.

The Registered Offering resulted in gross proceeds of $7.5 million, before deducting the placement agent’s fees and related offering expenses. The Registered Offering closed on April 16, 2020.

In connection with the Registered Offering, the placement agent received a cash commission equal to 7% of the gross proceeds from the sale of the Common Stock and warrants (the “Placement Agent’s Warrants”) to purchase up to 37,500 shares of Common Stock, which represented 5.0% of the Shares sold in the Registered Offering. The Placement Agent’s Warrants have an exercise price of $12.50 per share, which represented 125% of the per share offering price of the Shares and a termination date of April 16, 2025. The fair value of the Placement Agent’s Warrants was $289 and was based on the Black-Scholes pricing model. Input assumptions used were as follows: a risk-free interest rate of 0.4%; expected volatility of 78.0%; expected life of 5 years; and expected dividend yield of 0%. The underlying traded stock price was used in the analysis. The Placement Agent’s Warrants were classified in stockholders’ equity as the number of shares were fixed and determinable and given that the Placement Agent’s Warrants did not require cash settlement or have other provisions precluding equity treatment.

During the nine month period ended September 30, 2020, issuance costs in connection with the Registered Offering were $1.0 million which included cash commissions equal to $0.5 million, legal and other fees of $0.2 million and Placement Agent’s Warrants with a value of $0.3 million.

Warrants

The following warrants were outstanding as of September 30, 2020 and December 31, 2019:



	Exercise Price		Number Outstanding		Expiration Date	Number Exercisable
	$	186.75		1,440	July 2028		1,440
	$	260.00		39,115	March 2022		39,115
Total outstanding December 31, 2019				40,555			40,555

	$	12.50		37,500	April 2025		37,500
Total outstanding September 30, 2020				78,055			78,055

Stock-Based Compensation

9 Months Ended

Sep. 30, 2020

Stock-Based Compensation

Stock-Based Compensation

9. Stock-based Compensation

Stock-based compensation expense was included in general and administrative and research and development costs as follows in the accompanying statements of comprehensive loss (in thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
		2020		2019		2020		2019
Research and development	$	—	$	60	$	18	$	115
General and administrative		209		(6)		521		78
Total stock-based compensation	$	209	$	54	$	539	$	193

Stock Options

2019 and 2018 Stock Plans

In December 2018, Private NeuroBo adopted the NeuroBo Pharmaceuticals, Inc. 2018 Stock Plan (the "2018 Plan") and in December 2019 in connection with the Merger, the Company adopted the 2019 Equity Incentive Plan (the “2019 Plan”). 2018 Plan options to purchase Private NeuroBo common stock outstanding as of immediately prior to the Merger were assumed by the Company upon the Merger and became options to purchase the Company’s common stock, as adjusted by the Exchange Ratio. The 2018 Plan and 2019 Plan provide for the grant of stock options, restricted stock and other equity awards of the Company's common stock to employees, officers, consultants, and directors. Options expire within a period of not more than ten years from the date of grant.

The following table summarizes the Company’s activity related to its stock options for the nine months ended September 30, 2020 and 2019:


	Nine Months Ended
	September 30,
	2020	2019
Outstanding on January 1	633,277	—
Granted	420,000	960,204
Exercised	(84,589)	—
Forfeited/Cancelled	(48,333)	—
Outstanding on September 30	920,355	960,204

During the three month periods ended September 30, 2020 and 2019, 60,000 and zero stock options were granted, respectively, and 420,000 and 960,204 stock options were granted during the nine month periods ended September 30, 2020 and 2019, respectively, to employees, non-employee directors and non-employee consultants with both service and performance conditions. The options granted with service conditions generally vest over a one and three year period. The total number of stock options outstanding as of September 30, 2020 and December 31, 2019 was 920,355 and 633,277, respectively.

The weighted average fair value per share of options granted during the three month periods ended September 30, 2020 and 2019 was $3.91 and zero, respectively, and $5.35 and $0.50 during the nine month periods ended September 30, 2020 and 2019, respectively.

The Company measures the fair value of stock options with service‑based and performance‑based vesting criteria to employees, consultants and directors on the date of grant using the Black‑Scholes option pricing model. The Company does not have history to support a calculation of volatility and expected term. As such, the Company has used a weighted‑average volatility considering the volatilities of several guideline companies.

For purposes of identifying similar entities, the Company considered characteristics such as industry, length of trading history, and stage of life cycle. The assumed dividend yield was based on the Company’s expectation of not paying dividends in the foreseeable future. The average expected life of the options was determined based on the mid‑point between the vesting date and the end of the contractual term according to the “simplified method” as described in Staff Accounting Bulletin 110. The risk‑free interest rate is determined by reference to implied yields available from U.S. Treasury securities with a remaining term equal to the expected life assumed at the date of grant. The Company records forfeitures when they occur.

The weighted‑average assumptions used in the Black‑Scholes option‑pricing model are as follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019

Expected stock price volatility	76.8	%	—	%	77.4	%	75.0	%
Expected life of options (years)	5.8		—		5.8		10.0
Expected dividend yield	—	%	—	%	—	%	—	%
Risk free interest rate	0.36	%	—	%	1.51	%	2.75	%

Evergreen provision

Under the 2019 Plan, the shares reserved automatically increase on January 1st of each year, for a period of not more than ten years commencing on January 1, 2020 and ending on (and including) January 1, 2029, to an amount equal to the lesser of 4% of the common shares outstanding as of January 1st , or a lesser amount as determined by the Board. The aggregate maximum number of shares of common stock that may be issued pursuant to the 2019 Plan under the evergreen provision is 6,680,000 shares of common stock. On January 1, 2020, 623,708 shares were added to the 2019 Plan as a result of the evergreen provision.

During the three month periods ended September 30, 2020 and 2019, 28,333 and 37,151 stock options vested, respectively, and 115,485 and 194,327 stock options vested during the nine month periods ended September 30, 2020 and 2019, respectively. During the three and nine month periods ended September 30, 2020, 48,333 stock options were forfeited. During the three and nine month periods ended September 30, 2019, no stock options were forfeited.

As of September 30, 2020, 4,115,512 shares in the aggregate were available for future issuance under the 2019 Plan and 2018 Plan.

Unrecognized stock‑based compensation cost for the stock options issued under the both the Company’s 2019 Plan and 2018 Plan was $1.5 million as of September 30, 2020. The unrecognized stock‑based expense is expected to be recognized over a weighted average period of 2.4 years.

Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2020

Summary of Significant Accounting Policies

Use of Estimates

Use of estimates

Concentration of Credit Risk

Fair Value of Financial Instruments

General and Administrative Expenses

Research and Development Costs

Income Taxes

Stock-Based Compensation

Stock‑Based Compensation

Convertible Notes

Fair Value of Common Stock

Fair Value of common stock

Leases

Property and Equipment

Foreign Currency Translation

Patent Costs

Comprehensive Loss

Segment Information

Recent Accounting Pronouncements

Recent Accounting Pronouncements Adopted

Recent Accounting Pronouncements Not Yet Adopted

Balance Sheet Detail (Tables)

9 Months Ended

Sep. 30, 2020

Balance Sheet Detail

Schedule of property and equipment


	As of
	September 30,		December 31,
	2020		2019
Research and development equipment	$	158	$	158
Office equipment		60		59
Total property and equipment		218		217
Less accumulated depreciation		(51)		(17)
Property and equipment, net	$	167	$	200

Schedule of accrued liabilities


	September 30,		December 31,
	2020		2019
External research and development expenses	$	2,072	$	915
Professional services		209		158
Payroll related		176		160
Other		34		189
Total	$	2,491	$	1,422

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2020

Schedule of future minimum payments of other commitments

As of September 30, 2020, future minimum payments under the agreement, which is cancellable annually at the end of each research year, are as follows (in thousands):


		December 31,

2020	(period from October 1 to December 31)	$	66
2021			220
2022			220
		$	506

Head Quarters in Boston Lease

Schedule that reconciles the undiscounted lease liabilities to the total lease liabilities recognized on the unaudited consolidated balance sheet

Future minimum lease payments at September 30, 2020 were as follows under the New Boston Lease (in thousands):


	December 31,

2020 (period from October 1 to December 31)	$	64
2021		21
Total minimum payments	$	85

The following table reconciles the undiscounted lease liabilities to the total lease liabilities recognized on the consolidated balance sheet as of September 30, 2020 (in thousands):



	December 31,
2020 (period from October 1 to December 31)	$	8
2021		32
2022		32
2023		32
2024		16
Total lease payments		120
Less effect of discounting		(20)
Total		100
Short-term portion		(23)
Long-term portion	$	77

Stockholders’ Equity (Deficit) (Tables)

9 Months Ended

Sep. 30, 2020

Stockholders’ Equity

Schedule of Gemphire warrants assumed in the Merger



	Exercise Price		Number Outstanding		Expiration Date	Number Exercisable
	$	186.75		1,440	July 2028		1,440
	$	260.00		39,115	March 2022		39,115
Total outstanding December 31, 2019				40,555			40,555

	$	12.50		37,500	April 2025		37,500
Total outstanding September 30, 2020				78,055			78,055

Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2020

Stock-Based Compensation

Schedule of share-based compensation expense

Stock-based compensation expense was included in general and administrative and research and development costs as follows in the accompanying statements of comprehensive loss (in thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
		2020		2019		2020		2019
Research and development	$	—	$	60	$	18	$	115
General and administrative		209		(6)		521		78
Total stock-based compensation	$	209	$	54	$	539	$	193

Schedule of stock option plan activity


	Nine Months Ended
	September 30,
	2020	2019
Outstanding on January 1	633,277	—
Granted	420,000	960,204
Exercised	(84,589)	—
Forfeited/Cancelled	(48,333)	—
Outstanding on September 30	920,355	960,204

Schedule of weighted-average assumptions, option-pricing model


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019

Expected stock price volatility	76.8	%	—	%	77.4	%	75.0	%
Expected life of options (years)	5.8		—		5.8		10.0
Expected dividend yield	—	%	—	%	—	%	—	%
Risk free interest rate	0.36	%	—	%	1.51	%	2.75	%

The Company and Basis of Presentation (Details) $ / shares in Units, $ in Thousands				2 Months Ended	12 Months Ended
	Apr. 13, 2020 USD ($) $ / shares shares	Aug. 11, 2019	Jul. 24, 2019	Jun. 30, 2019 USD ($)	Dec. 31, 2018 USD ($)	Sep. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)
Sale of Stock
Cash						$ 12,353	$ 13,908
Accumulated deficit						$ (47,034)	$ (36,866)
Reverse stock split, ratio		0.0001
Series A Redeemable Convertible Preferred Stock
Sale of Stock
Net proceeds					$ 16,800
Registered Offering
Sale of Stock
Issuance of common stock in connection with equity financing (in shares) \| shares	750,000
Offering shares (Per share) \| $ / shares	$ 10
Gross proceeds	$ 7,500
Convertible notes
Sale of Stock
Net proceeds					$ 500
Series B Redeemable Convertible Preferred Stock
Sale of Stock
Net proceeds				$ 24,200
Merger Agreement with NeuroBo
Sale of Stock
Reverse stock split, ratio			1.1431
Percentage of interest held by our exiting shareholders			96.20%

Commitments and Contingencies - Operating Leases - (Details) - USD ($) $ in Thousands		1 Months Ended		3 Months Ended		9 Months Ended
	Nov. 11, 2020	Sep. 30, 2019	May 31, 2019	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Commitments and Contingencies
Right-of-use assets				$ 100		$ 100		$ 116
Operating lease, liability current				23		23		$ 22
Operating lease, liability noncurrent				$ 77		$ 77
Non-cash expense related to Korea lease							$ 128
Korea
Commitments and Contingencies
Term of contract			5 years
Option to renew			true
Renewal term			5 years
Right-of-use assets		$ 126			$ 126		$ 126
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]		us-gaap:OtherCurrentLiabilitiesMember			us-gaap:OtherCurrentLiabilitiesMember		us-gaap:OtherCurrentLiabilitiesMember
Operating lease, liability current		$ 20			$ 20		$ 20
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]		us-gaap:OtherNoncurrentLiabilitiesMember			us-gaap:OtherNoncurrentLiabilitiesMember		us-gaap:OtherNoncurrentLiabilitiesMember
Operating lease, liability noncurrent		$ 106			$ 106		$ 106
Operating lease discount rate				10.00%		10.00%
Weighted average remaining lease term				3 years 9 months		3 years 9 months
Non-cash expense related to Korea lease				$ 8		$ 24
Non-cash lease liability adjustment					$ 5	24	$ 8
Head Quarters in Boston Lease
Commitments and Contingencies
Term of contract	6 months	1 year			1 year		1 year
Monthly rental cost	$ 3	$ 21
Rent concessions granted by the landlord	$ 1	$ 32			$ 32		$ 32
Lease expense				64	$ 40	244	$ 93
Termination fee				$ 83		$ 83

Commitments and Contingencies - Operating Lease - Lease liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Maturity of the lease liability was as follows (in thousands):
2020	$ 8
2021	32
2022	32
2023	32
2024	16
Total lease payments	120
Less effect of discounting	(20)
Total	100
Short-term portion	(23)	$ (22)
Long-term portion	77
Head Quarters in Boston Lease
Maturity of the lease liability was as follows (in thousands):
2020	64
2021	21
Total lease payments	$ 85

Stockholders’ Equity (Deficit) (Details) $ / shares in Units, $ in Thousands		3 Months Ended			9 Months Ended
	Apr. 13, 2020 USD ($) $ / shares shares	Sep. 30, 2020 USD ($) $ / shares	Jun. 30, 2020 shares	Jun. 30, 2019 USD ($)	Sep. 30, 2020 USD ($) Vote / shares $ / shares	Sep. 30, 2019 USD ($)	Dec. 31, 2019 $ / shares
Voting Rights
Warrants exercise price \| $ / shares		$ 302,020.00			$ 302,020.00		$ 312,019.00
Risk free interest rate		0.36%			1.51%	2.75%
Expected stock price volatility		76.80%			77.40%	75.00%
Expected life of options (years)		5 years 9 months 18 days			5 years 9 months 18 days	10 years
Issuance costs				$ 74	$ 695	$ 74
Registered Offering
Voting Rights
Shares issued (in shares) \| shares	750,000
Offering shares (Per share) \| $ / shares	$ 10
Gross proceeds	$ 7,500
Cash commission (Percent)	7.00%
Warrants to purchase shares of common stock \| shares	37,500
Warrants to purchase shares of common stock, Percentage \| shares	5.0
Warrants exercise price \| $ / shares	$ 12.50
Warrant exercise price, percentage	125.00%
Fair market value of warrant		$ 289			$ 289
Risk free interest rate					0.40%
Expected stock price volatility					78.00%
Expected life of options (years)					5 years
Expected dividend yield					0.00%
Issuance costs		1,000			$ 1,000
Cash commissions		500			500
Legal and other fees		200			200
Placement agents warrants		300			$ 300
Common Stock
Common Stock
Common stock, vote per share \| Vote / shares					1
Dividends Rights
No dividends declared		$ 0			$ 0
Voting Rights
Common stock, vote per share \| Vote / shares					1
Shares issued (in shares) \| shares			750,000

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2020	Dec. 31, 2019
Condensed Consolidated Balance Sheets
Preferred stock, par value (in dollar per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollar per share)	$ 0.001	$ 0.001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	16,427,307	15,592,718
Common stock, shares outstanding	16,427,307	15,592,718

Merger	9 Months Ended
Merger	Sep. 30, 2020
Merger
Merger	4. Merger The Merger, which closed on December 30, 2019, was accounted for as a reverse asset acquisition pursuant to Topic 805, Business Combinations, as substantially all of the fair value of the assets acquired were concentrated in a group of similar non-financial assets, and the acquired assets did not have outputs or employees. Contingent Value Rights Agreement On December 30, 2019, in connection with the Merger, the Company, Grand Rapids Holders’ Representative, LLC, as representative of the Company’s stockholders prior to the Merger, and Computershare Inc. and Computershare Trust Company, N.A. as the rights agent, entered into a Contingent Value Rights Agreement (the “CVR Agreement”). The Company’s stockholders of record as of immediately prior to the effective date of the Merger received one contingent value right (“CVR”) entitling such holders to receive, in the aggregate, 80% of the Gross Consideration less other Permitted Deductions (each as defined in the CVR Agreement) received during the 15-year period after the closing of the Merger (the “CVR Term”) from the grant, sale or transfer of rights to Gemcabene (other than a grant, sale or transfer of rights involving a sale or disposition of the post-Merger combined company) that is entered into during the 10-year period after the closing of the Merger or pursuant to the Beijing SL Agreement (as defined in Note 6 – License Agreement below), but not including the $2.5 million upfront gross payment pursuant to the Beijing SL Agreement. Under the CVR Agreement, the Company agreed to commit up to $1 million to support the further development of Gemcabene, to be funded following execution of the Beijing SL Agreement and the receipt by the Company of the $2.5 million upfront gross payment payable under the Beijing SL Agreement, which the Company received in October 2019. The CVRs are not transferable, except in certain limited circumstances, will not be certificated or evidenced by any instrument, will not accrue interest and will not be registered with the SEC or listed for trading on any exchange. The CVR Agreement will continue in effect until the later of the end of the CVR Term and the payment of all amounts payable thereunder. Through September 30, 2020, no milestones had been accrued as there were no potential milestones yet considered probable.

Debt	9 Months Ended
Debt	Sep. 30, 2020
Debt
Debt	7. Debt (in thousands, except share and per share data) In February 2018, the Company received a total of $500 from the issuance by Private NeuroBo of convertible promissory notes (the "Convertible Notes") with an original maturity date of December 31, 2022. On December 30, 2019, the Convertible Notes were converted into 1,565,300 shares of common stock. Prior to conversion, the lenders had the option to convert all of the then-unpaid note balance including principal and accrued but unpaid interest into common stock, at a conversion price of $0.40 per share after the earlier of (A) the closing of a firmly underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended, covering the offer and sale of common stock for the account of the Company in the United States of America or similar registration in the Republic of Korea, or (B) January 1, 2020. On October 23, 2019, the Convertible Notes were amended (the “Amended Convertible Notes”) to require mandatory conversion upon the completion of a reverse merger transaction based on the then-unpaid note balance including principal and accrued but unpaid interest into common stock, at a conversion price of $0.40 per share. The Convertible Notes and Amended Convertible Notes (herein collectively referred to as the “Notes”) accrued interest at a rate of 5.00% per annum. The Company recorded interest on principal of $6 and $19 for the three and nine month periods ended September 30, 2019, respectively. The Notes were not outstanding during 2020. The fair value of the common stock, as determined using an option pricing model consistent with the AICPA Practice Guide, was in excess of the conversion price of the Convertible Notes. Accordingly, the Company initially recorded a $401 beneficial conversion feature upon issuance based on the intrinsic value of the conversion feature, which resulted in a debt discount with a corresponding amount to additional paid in capital. Debt discount related to the beneficial conversion feature was being amortized over the life of the Convertible Notes using the effective interest method as additional interest expense. The Company recorded interest expense of $10 and $26 for the three and nine month periods ended September 30, 2019 , respectively, related to the debt discount.

Redeemable Preferred Stock	9 Months Ended
Redeemable Preferred Stock	Sep. 30, 2020
Redeemable Preferred Stock.
Redeemable Preferred Stock	10. Redeemable Preferred Stock (in thousands, except share and per share data) Upon close of the Merger on December 30, 2019, 8,264,613 shares of Private NeuroBo Series A and Series B redeemable preferred stock (as adjusted for the Exchange Ratio) were converted to Private NeuroBo common stock on a 1:1 basis. Previously in April 2018, Private NeuroBo sold and issued in a private placement 4,801,020 shares of Series A redeemable convertible preferred stock (as adjusted for the Exchange Ratio) at $3.50 per share, raising $16,800 in gross proceeds. Subsequently in May and June 2019, Private NeuroBo sold and issued 3,463,593 Series B redeemable convertible preferred stock (as adjusted for the Exchange Ratio) at $7.00 per share, raising $24,240 in gross proceeds. While outstanding, the redeemable preferred stock was classified outside of stockholders' equity (deficit) because the shares contained certain redemption features that were not solely within the control of the Company. Private NeuroBo did not adjust the carrying values of the convertible preferred stock to the liquidation preferences of such shares because the occurrence of any such change of control event was not deemed probable.

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2020
Income Taxes
Income Taxes	12. Income Taxes The effective tax rate for the three and nine month periods ended September 30, 2020 and 2019 was zero percent. As a result of the analysis of all available evidence as of September 30, 2020 and December 31, 2019, the Company recorded a full valuation allowance on its net deferred tax assets. Consequently, the Company reported no income tax benefit for the three and nine month periods ended September 30, 2020 and 2019. If the Company’s assumptions change and the Company believes that it will be able to realize these deferred tax assets, the tax benefits relating to any reversal of the valuation allowance on deferred tax assets will be recognized as a reduction of future income tax expense. If the assumptions do not change, each period the Company could record an additional valuation allowance on any increases in the deferred tax assets. On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) which includes modifications to the limitation on business interest expense and net operating loss provisions, and provides a payment delay of employer payroll taxes during 2020 after the date of enactment. The CARES Act is not expected to have a material impact on the Company’s consolidated financial statements.

Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Jun. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Condensed Consolidated Statements of Changes in Stockholders’ Equity
Payments of Stock Issuance Costs	$ 74	$ 695	$ 74

Related Party Transactions	9 Months Ended
Related Party Transactions	Sep. 30, 2020
Related Party Transactions
Related Party Transactions	13. Related Party Transactions (in thousands, except per share data) On September 28, 2018, Private NeuroBo entered into a five year manufacturing and supply agreement with Dong-A ST for manufacturing and supply of NB-01 drug substance and placebos for the purpose of research and development to be used in Phase 3 clinical trials (the “Manufacturing Agreement”). The Company recognized no product manufacturing related costs under the Manufacturing Agreement for the three month and nine month periods ended September 30, 2020, and zero and $314 during the three and nine month periods ended September 30, 2019, respectively. The product manufacturing related costs, when incurred, are reflected as research and development expenses. None of the costs incurred under the Manufacturing Agreement remained unpaid as of September 30, 2020 or December 31, 2019. The Manufacturing Agreement will automatically terminate in the event that the license agreement with Dong-A ST is terminated for any reason. In addition, each of Dong-A ST and NeuroBo may terminate the Manufacturing Agreement (1) upon the material breach by the other party, if the breach is not cured within a specified number of days after receiving notice from the terminating party, or if the breach cannot reasonably be cured within such period and the breaching party has not started to remedy the breach within such period and diligently endeavored to cure the breach within a reasonable time thereafter, or (2) in the event that (i) the other party is the subject of a petition for bankruptcy, reorganization, or arrangement and the same is not dismissed within thirty days thereof, (ii) a receiver or trustee is appointed for all or a substantial portion of the assets of the other party, or (iii) the other party makes an assignment for the benefit of its creditors. On June 7, 2020, the Company entered into a manufacturing and supply agreement (the “Manufacturing and Supply Agreement”) with Dong-A ST for the manufacturing and supply of NB-02 drug product and placebo for the purpose of research and development of NB-02, including but not limited to, the use in the first NB-02 human clinical trial to be conducted by the Company. Under the terms of the Manufacturing and Supply Agreement, upon receipt of a purchase order from the Company no later than 270 days prior to the requested delivery date, Dong-A ST has agreed to produce for the Company tablets of the NB-02 drug substance and placebos at a specified supply price. The Company is obligated to manufacture, or have manufactured, and supply to Dong-A the active pharmaceutical ingredients which are necessary to manufacture the NB-02 drug product. The Manufacturing and Supply Agreement has a five year term, subject to earlier termination under certain circumstances.

Subsequent Events	9 Months Ended
Subsequent Events	Sep. 30, 2020
Subsequent Events
Subsequent Events	14. Subsequent Events (in thousands) On November 11, 2020, the Company entered a non-cancelable operating lease, for its corporate headquarters. The agreement, effective February 1, 2021, has a six month term, and rental costs of approximately $3 per month prior to the application of certain rent concessions granted by the landlord in the amount of approximately $1 over the term of the lease.

Summary of Significant Accounting Policies (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2020 USD ($) segment	Sep. 30, 2019 USD ($)
Concentration of Credit Risk
Deposits in excess of federally insured amounts	$ 11,800		$ 11,800
Income Taxes
Provision (benefit) for income taxes	$ 0	$ 0	$ 0	$ 0
Segment Information
Number of operating segment \| segment			1
Minimum
Estimated useful life			3 years
Maximum
Estimated useful life			5 years

Balance Sheet Detail (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Balance Sheet Detail (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Balance Sheet Detail
Total property and equipment	$ 218		$ 218		$ 217
Less accumulated depreciation	(51)		(51)		(17)
Property and equipment, net	167		167		200
Depreciation	12	$ 5	34	$ 5
Research and development equipment
Balance Sheet Detail
Total property and equipment	158		158		158
Office equipment
Balance Sheet Detail
Total property and equipment	$ 60		$ 60		$ 59

Merger - Contingent Value Rights Agreement (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2020	Jul. 23, 2019
Merger Agreement
Percentage of gross consideration	80.00%
Contingent value rights term	15 years
Contingent value rights term incase of other than grant, sale or transfer	10 years
Commitment to support develop gemcabene	$ 1.0
License Agreement with Beijing SL
Merger Agreement
Upfront payment to be received		$ 2.5

Commitments and Contingencies - Xiehecheng Cultivation Service Agreement (Details) - Xiehecheng Chinese Herm Limited Corporation - Cultivation Service Agreement $ in Thousands	Sep. 30, 2020 USD ($)
Other Commitments [Line Items]
2020	$ 66
2021	220
2022	220
Other Commitment, Total	$ 506

Commitments and Contingencies - Pfizer License Agreement (Details) $ in Thousands	1 Months Ended	9 Months Ended
	Mar. 31, 2015 USD ($)	Sep. 30, 2020 USD ($)
Commitments and Contingencies
Milestones or royalty payments triggered		$ 0
License Agreement
Commitments and Contingencies
Termination fee		$ 3,000
Pfizer, Inc. \| License Agreement
Commitments and Contingencies
Number of years after the first commercial sale	P5Y
Notice period	90 days
Pfizer, Inc. \| License Agreement \| Milestone Payments \| Maximum
Commitments and Contingencies
Potential payments upon achievement of certain milestones	37,000

License Agreement - Beijing (Details) - USD ($) $ in Thousands		9 Months Ended
	Jul. 23, 2019	Sep. 30, 2020
License Agreements
Minimum expected period to begin future installment payment	1 year
Maximum
License Agreements
Clinical supply agreement execution period from effective date	12 months
License Agreement with Beijing SL
License Agreements
Revenue recognized from the agreement		$ 0
Upfront payment to be received	$ 2,500
Period from effective date within which upfront gross payment to be paid	45 days
Developmental and regulatory milestone payment eligible to be received	$ 6,000
Global net sales milestone payment to be received	$ 20,000
License Agreement with Beijing SL \| Maximum
License Agreements
Percentage of royalty on net sales	20.00%

Debt (Details) - USD ($) $ / shares in Units, $ in Thousands			1 Months Ended	3 Months Ended	9 Months Ended
	Dec. 30, 2019	Oct. 22, 2019	Feb. 28, 2018	Sep. 30, 2019	Sep. 30, 2019	Sep. 30, 2020	Oct. 23, 2019
Debt
Conversion price							$ 0.40
Convertible notes
Debt
Proceeds from debt issued			$ 500
Shares issued on debt conversion	1,565,300
Conversion price							$ 0.40
Convertible interest rate (as a percentage)						5.00%
Interest on principal				$ 6	$ 19
Debt beneficial conversion feature		$ 401
Amortization of debt discount				$ 10	$ 26

Stockholders’ Equity (Deficit) - Warrants (Details) - $ / shares	Sep. 30, 2020	Dec. 31, 2019
Warrants
Exercise price	$ 302,020.00	$ 312,019.00
Number Outstanding	78,055	40,555
Number Exercisable	78,055	40,555
$186.75
Warrants
Exercise price	$ 186.75
Number Outstanding	1,440
Number Exercisable	1,440
$260.00
Warrants
Exercise price	$ 260.00
Number Outstanding	39,115
Number Exercisable	39,115
$12.50
Warrants
Exercise price	$ 12.50
Number Outstanding	37,500
Number Exercisable	37,500

Stock-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Stock-Based Compensation (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Stock-Based Compensation
Share-based compensation	$ 209	$ 54	$ 539	$ 193
Research and development
Stock-Based Compensation
Share-based compensation		60	18	115
General and administrative
Stock-Based Compensation
Share-based compensation	$ 209	$ (6)	$ 521	$ 78

Stock-Based Compensation - Stock opption plan activity (Details) - shares	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Stock option plan activity
Outstanding, Number, Beginning Balance (in shares)	633,277
Granted (in shares)	420,000	960,204
Exercised (in shares)	(84,589)
Forfeited/Cancelled (in shares)	(48,333)
Outstanding, Number, Ending Balance (in shares)	920,355	960,204

Stock-Based Compensation - Assumptions (Details)	3 Months Ended	9 Months Ended
Stock-Based Compensation - Assumptions (Details)	Sep. 30, 2020	Sep. 30, 2020	Sep. 30, 2019
Stock-Based Compensation
Expected stock price volatility	76.80%	77.40%	75.00%
Expected life of options (years)	5 years 9 months 18 days	5 years 9 months 18 days	10 years
Risk free interest rate	0.36%	1.51%	2.75%

Stock-Based Compensation - Evergreen provision (Details) - USD ($) $ in Millions		3 Months Ended		9 Months Ended
	Jan. 01, 2020	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Stock options
Number of Options
Forfeited, nonvested			0		0
2019 Plan
Number of Options
Period of automatic increase in shares reserved				10 years
Percentage of the common shares outstanding (as a percent)				4.00%
Number of shares added (In shares)	623,708
2019 Plan \| Stock options
Number of Options
Vested		28,333	37,151	115,485	194,327
Forfeited, nonvested		48,333		48,333
Stock Plan 2018 And 2019 Plans
Unrecognized share-based compensation
Unrecognized share-based compensation cost		$ 1.5		$ 1.5
Unrecognized share-based compensation - Weighted average period				2 years 4 months 24 days
Stock Plan 2018 And 2019 Plans \| Stock options
Number of Options
Aggregate maximum number of shares of common stock that may be issued		4,115,512		4,115,512
Maximum \| 2019 Plan
Number of Options
Aggregate maximum number of shares of common stock that may be issued		6,680,000		6,680,000

Redeemable Preferred Stock (Details) - USD ($)		1 Months Ended	2 Months Ended
Redeemable Preferred Stock (Details) - USD ($)	Dec. 30, 2019	Apr. 30, 2018	Jun. 30, 2019
Series A and Series B Redeemable Convertible Preferred Stock
Redeemable Preferred Stock
Number of stock converted	8,264,613
Conversion ratio	1
Series A Redeemable Convertible Preferred Stock
Redeemable Preferred Stock
Shares issued (in shares)		$ 4,801,020
Shares price (in dollars per share)		$ 3.50
Gross proceeds		$ 16,800,000
Series B Redeemable Convertible Preferred Stock
Redeemable Preferred Stock
Shares issued (in shares)			$ 3,463,593
Shares price (in dollars per share)			$ 7.00
Gross proceeds			$ 24,240,000

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Income Taxes
Effective tax rate	0.00%	0.00%	0.00%	0.00%
Income tax benefit (expense)	$ 0	$ 0	$ 0	$ 0

Related Party Transactions (Details) - Dong-A ST - Manufacturing Agreement - USD ($) $ in Thousands		3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 28, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Related Party Transactions
Term of agreement	5 years
Related Party Costs		$ 0	$ 0	$ 0	$ 314	$ 0
Period for dismission of allegations.				30 days

Subsequent Events (Details) - Head Quarters in Boston Lease - USD ($) $ in Thousands		1 Months Ended
	Nov. 11, 2020	Sep. 30, 2019
Subsequent Event [Line Items]
Term of contract	6 months	1 year
Monthly rental cost	$ 3	$ 21
Rent concessions granted by the landlord	$ 1	$ 32