0001558370-24-011904 | 10-Q | XBRL Viewer

Summary of Significant Accounting Policies - Co-Payment Assistance (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Receivables [Abstract]
Provision for revenue reserve	$ 7.2	$ 6.3	$ 15.9	$ 10.8
Reserve for variable consideration	$ 7.5		$ 7.5

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Jun. 30, 2024	Mar. 31, 2024	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (11,872)	$ 1,284	$ (3,809)	$ (5,389)	$ (10,590)	$ (9,197)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

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+ Details

Credit Agreement and Guaranty - Carrying Amount Of term Loan (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Credit Agreement and Guaranty
Long-term debt					$ 1,650,000
Debt issuance costs					(23,000)
Warrant discount					(112,000)
Total debt					1,515,000
Less, current portion					$ 1,515,000
Amortization and debt issue costs	$ 0	$ 372,000	$ 0	$ 679,000

- Definition

Amount, after deduction of unamortized premium (discount) and debt issuance cost, of long-term debt. Excludes lease obligation.

+ References + Details

Organization and Description of Business

6 Months Ended

Jun. 30, 2024

Organization and Description of Business

Organization and Description of Business

1. Organization and Description of Business

Nature of Operations

Agile Therapeutics, Inc. (“Agile” or the “Company”) was incorporated in Delaware on December 22, 1997. Agile is a women’s healthcare company dedicated to fulfilling the unmet health needs of today’s women. The Company’s activities since inception have consisted principally of raising capital, performing research and development, including development of the Company’s lead product, Twirla^®, and more recently commercializing Twirla. The Company is headquartered in Princeton, New Jersey.

On June 25, 2024, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Insud Pharma, S.L., a Spanish company (“Insud”), and Exeltis Project, Inc., a Delaware corporation and indirect, wholly owned subsidiary of Insud (“Merger Sub”) (see Note 10 for additional information). Pursuant to the terms and subject to the conditions of the Merger Agreement, Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger as an indirect wholly owned subsidiary of Insud.

The Company’s sole approved product, Twirla, is a once-weekly prescription contraceptive patch that received approval from the U.S. Food and Drug Administration, or FDA, in February 2020 and was commercially launched in early December 2020. Substantially all of the Company’s resources are currently dedicated to commercializing Twirla in the United States. The Company has generated minimal product revenue to date and is subject to a number of risks similar to those of other early stage commercial companies, including, but not limited to, dependence on key individuals, the difficulties and uncertainties inherent in the development of commercially usable products, market acceptance of products, protection of proprietary technology, the need to obtain additional capital necessary to fund the development of its products, reliance on a consistent supply chain both for Twirla and in general, macroeconomic factors such as inflation, competition from larger companies, and compliance with FDA and other government regulations. If the Company does not continue to successfully commercialize Twirla, it will be unable to generate recurring product revenue or achieve profitability. The Company has incurred operating losses and negative cash flows from operating activities each year since inception. As of June 30, 2024, the Company had an accumulated deficit of approximately $433.8 million. The Company expects to continue to incur significant operating expenses for the foreseeable future in connection with its ongoing activities, as the Company:

●

maintains a sales and marketing infrastructure and contract manufacturing arrangement to support the continued commercialization of Twirla in the United States;

●

continues to commercialize Twirla and seek increased uptake of Twirla in the United States;

●

continues to evaluate additional line extensions for Twirla and initiates development of potential product candidates in addition to Twirla;

●

maintains, leverages, and expands the Company’s intellectual property portfolio; and

●

maintains operational, financial, and management information systems and personnel, including personnel to support the Company’s product development and future commercialization efforts.

The Company has financed its operations to date primarily through the issuance and sale of its common stock in both public and private offerings (see Note 8), private placements of its convertible preferred stock, venture loans, and non-dilutive grant funding.

Going Concern

As of June 30, 2024, the Company had cash and cash equivalents of $2.8 million and a $11.8 million working capital deficit. The Company’s current liquidity is sufficient to fund operations into September 2024. The Company closely monitors its cash and cash equivalents and, if the Merger is not consummated, will need to raise additional funds to meet its projected operating requirements, including the continued commercialization of Twirla. If the Merger is not consummated, the Company has serious concerns about its ability to continue as a going concern absent additional capital and its possible expansion through business development activities.

The Company has generated losses since inception, used substantial cash in operations, has a working capital deficit as of June 30, 2024, and anticipates it will continue to incur net losses for the foreseeable future. The Company’s future success depends on its ability to obtain additional capital and/or implement various strategic alternatives, and there can be no assurance that any financing can be realized by the Company, or if realized, what the terms of any such financing may be, or that any amount that the Company is able to raise will be adequate. Based upon the foregoing, management has concluded that there is substantial doubt about the Company’s ability to continue as a going concern through the 12 months following the date on which this Quarterly Report on Form 10-Q is filed.

One June 25, 2024, the Company has entered into the Merger Agreement, pursuant to which the Company will become an indirect wholly owned subsidiary of Insud. If the Merger is not consummated, the board of directors of the Company (the “Board”) will continue to evaluate and review the Company’s business, operations, assets, operating results, financial condition, prospects and business strategy, among other things, and make such changes as are deemed appropriate and continue to seek to enhance stockholder value. If the Merger Agreement is not adopted by the Company’s stockholders or if the Merger is not consummated for any other reason, there can be no assurance that any other transaction acceptable to Agile will be offered or that the Company’s business, prospects or results of operations will not be adversely impacted. The Company currently has a net working capital deficiency, and if the Merger is not consummated the Company may not be able to continue in the ordinary course and may need to seek bankruptcy protection. Additionally, concurrently with the execution of the Merger Agreement, the Company and Insud entered into a Revolving Promissory Note (the “Note”), pursuant to which Insud made available to the Company a line of credit in a maximum aggregate principal amount of up to $8.0 million (the “Bridge Loan”) issued by the Company, as borrower, in favor of Exeltis USA, Inc. (“Exeltis”), a New Jersey corporation and wholly owned subsidiary of Insud, which is secured by the Company’s intellectual property. No amounts were drawn on the Bridge Loan as of June 30, 2024. If the Merger is not consummated in certain instances, Exeltis shall have the right to declare an Event of Default (as defined in the Note) and immediately declare any amounts outstanding under the Note due and payable, and Agile shall be obligated to repay any amounts outstanding (including interest accrued) under the Note. Since the Bridge Loan is secured by Agile’s intellectual property, if Agile cannot repay the Bridge Loan, Exeltis would have the right to foreclose on such collateral as recourse for the failure to pay.

Absent the consummation of the Merger, the Company’s future success depends on its ability to raise additional capital as discussed above. The Company cannot be certain that these initiatives, or raising additional capital, whether through selling additional debt or equity securities or obtaining a line of credit or other loan, will be available to it or, if available, will be on terms acceptable to the Company. If the Company issues additional securities to raise funds, these securities may have rights, preferences, or privileges senior to those of its common stock, and the Company’s current stockholders will experience dilution. If the Company is unable to obtain funds when needed or on acceptable terms, the Company then may be unable to continue the commercialization of Twirla, and may also be required to cut operating costs, and forego future development and other opportunities or seek bankruptcy protection.

The unaudited financial statements as of June 30, 2024 have been prepared under the assumption that the Company will continue as a going concern for the next 12 months. Absent the consummation of the Merger, the Company’s ability to continue as a going concern is dependent upon its uncertain ability to obtain additional capital, reduce expenditures and/or execute on its business plan and successfully commercialize Twirla. The unaudited financial statements as of June 30, 2024 do not include any adjustments that might result from the outcome of this uncertainty. If the Company is unable to continue as a going concern, it may have to liquidate its assets and may receive less than the value at which those assets are carried on the financial statements.

Basis of Presentation

The accompanying unaudited interim financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim information and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for Quarterly Reports on Form 10-Q. Accordingly, certain information and footnote disclosure normally included in financial statements prepared in accordance with U.S. GAAP has been condensed or omitted pursuant to such rules and regulations.

These interim financial statements should be read in conjunction with the audited financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the SEC on March 28, 2024.

In the opinion of management, the unaudited interim financial statements reflect all adjustments, which are normal recurring adjustments, necessary for the fair presentation of the financial information for the interim periods presented. The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the operating results for the full fiscal year or any future period.

The accompanying unaudited financial statements have been prepared on a basis which assumes that the Company will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business. The Company has incurred recurring losses and negative cash flows from operations. If the Company encounters unforeseen factors that impact the Company’s current business plan or its ability to generate revenue from the commercialization of Twirla, the Company believes it has the ability to revise its commercial plans, including curtailing sales and marketing spending, to allow it to continue to fund its operations.

Summary of Significant Accounting Policies - Concentrations of Credit Risk (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024 USD ($) customer	Jun. 30, 2023 USD ($) customer	Jun. 30, 2024 USD ($) customer	Jun. 30, 2023 USD ($) customer
Concentration risk, financial liabilities
Financial instruments with off-balance sheet risk of accounting loss, liabilities	$ 0		$ 0
Total revenue	5,576	$ 5,503	11,292	$ 9,316
Customer Concentration Risk \| Sales Revenue \| Customer One
Concentration risk, financial liabilities
Total revenue	1,100	1,300	2,100	2,200
Customer Concentration Risk \| Sales Revenue \| Customer Two
Concentration risk, financial liabilities
Total revenue	1,000	1,200	2,000	2,100
Customer Concentration Risk \| Sales Revenue \| Customer Three
Concentration risk, financial liabilities
Total revenue	1,000	1,100	1,800	1,900
Customer Concentration Risk \| Sales Revenue \| Customer Four
Concentration risk, financial liabilities
Total revenue	800	$ 800	1,700	$ 1,900
Customer Concentration Risk \| Sales Revenue \| Customer Five
Concentration risk, financial liabilities
Total revenue	700		1,600
Customer Concentration Risk \| Sales Revenue \| Customers six
Concentration risk, financial liabilities
Total revenue	$ 500		$ 1,300
Customer Concentration Risk \| Sales Revenue \| Six Customers
Concentration risk, financial liabilities
Number of major customers \| customer	6		6
Concentration risk, percentage	92.00%		93.00%
Customer Concentration Risk \| Sales Revenue \| Four Customers
Concentration risk, financial liabilities
Number of major customers \| customer		4		4
Concentration risk, percentage		83.00%		87.00%
Customer Concentration Risk \| Accounts Receivable \| Six Customers
Concentration risk, financial liabilities
Number of major customers \| customer			6
Concentration risk, percentage			97.00%

Stockholders' Deficit - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Stock-Based Compensation Expense
Total stock-based compensation expense	$ 284	$ 482	$ 618	$ 979
Cost of product revenues
Stock-Based Compensation Expense
Total stock-based compensation expense	17	28	36	57
Research and development
Stock-Based Compensation Expense
Total stock-based compensation expense	63	81	137	168
Selling and marketing
Stock-Based Compensation Expense
Total stock-based compensation expense	8	32	20	62
General and administrative
Stock-Based Compensation Expense
Total stock-based compensation expense	$ 196	$ 341	$ 425	$ 692

Accrued Liabilities (Tables)

6 Months Ended

Jun. 30, 2024

Accrued Liabilities

Schedule of accrued liabilities

Accrued liabilities consist of the following (in thousands):


	June 30,		December 31,
	2024		2023
Gross to net accruals	$	7,507	$	6,492
Accrued compensation		954		832
Accrued professional fees and other		935		1,807
Total accrued liabilities	$	9,396	$	9,131

Leases (Tables)

6 Months Ended

Jun. 30, 2024

Leases

Schedule of future minimum lease payments under non-cancellable leases

Future minimum lease payments under non-cancellable leases as of June 30, 2024 were as follows (in thousands):


2024	$	199
2025		101
Total	$	300
Less: Interest		(11)
Present value of lease liability	$	289

Fair Value Measurements - Financial Instruments Measured at Fair Value by Hierarchy Level (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Liabilities:
Warrant liability	$ 10,647	$ 5,696
Recurring \| Level 1
Assets:
Cash and cash equivalents	2,848	2,557
Total assets at fair value	2,848	2,557
Recurring \| Level 3
Liabilities:
Warrant liability	10,647	5,696
Total liabilities at fair value	$ 10,647	$ 5,696

Leases - Summary (Details)	3 Months Ended		6 Months Ended
Leases - Summary (Details)	Jun. 30, 2024 USD ($) lease	Jun. 30, 2023 USD ($)	Jun. 30, 2024 USD ($) lease	Jun. 30, 2023 USD ($)
Leases
Number of finance leases \| lease	0		0
Number of operating leases \| lease	1		1
Lessee, Operating Lease, Existence of Option to Extend [true false]			true
Renewal term	5 years		5 years
Operating lease expense \| $	$ 89,000	$ 89,000	$ 178,000	$ 178,000
Operating lease expense information:
Cash paid for amounts included in measurement of lease liabilities \| $			$ 177,000	$ 154,000
Weighted-average remaining lease term (years)	9 months		9 months
Weighted-average discount rate	11.80%		11.80%

Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
Statements of Cash Flows - USD ($) $ in Thousands	Jun. 30, 2024	Jun. 30, 2023
Cash flows from operating activities:
Net loss	$ (10,590)	$ (9,197)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	48	51
Amortization	157	137
Noncash stock-based compensation	618	979
Noncash amortization of deferred financing costs	135	586
Unrealized loss (gain) on warrants	4,951	(3,361)
Changes in operating assets and liabilities:
Accounts receivable	(1,158)	(1,084)
Inventory	(3,055)	(1,204)
Prepaid expenses and other assets	(408)	1,873
Accounts payable and accrued expenses	7,236	1,260
Lease liability	(177)	(154)
Net cash used in operating activities	(2,243)	(10,114)
Cash flows from financing activities:
Proceeds from the exercise of common stock warrants, net of offering costs	4,376	6,509
Repayments of debt	(1,650)	(450)
Repayments of note payable	(191)	(61)
Net cash provided by financing activities	2,535	7,653
Net increase (decrease) in cash and cash equivalents	292	(2,461)
Cash and cash equivalents, beginning of period	2,556	5,246
Cash and cash equivalents, end of period	2,848	2,785
Supplemental cash flow information
Interest paid	$ 50	93
At-the-market sales
Cash flows from financing activities:
Proceeds from At-the-Market sales of common stock, net of offering costs		$ 1,655

Summary of Significant Accounting Policies - Advertising Costs (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Summary of Significant Accounting Policies
Advertising costs	$ 0.0	$ 0.0	$ 0.0	$ 0.0

Stockholders' Deficit - Amended and Restated Certificate of Incorporation (Details)	Apr. 10, 2023 shares	Jun. 30, 2024 shares	Dec. 31, 2023 shares	Apr. 09, 2023 shares	Jan. 07, 2022 shares	Jan. 06, 2022 shares
Stockholders' Deficit
Common stock, authorized (in shares)		300,000,000	300,000,000		300,000,000	150,000,000
Reverse stock split conversion ratio	0.02
Common stock, issued (in shares)	932,101	6,904,498	2,963,657	46,605,134
Common Stock, Shares, Outstanding	932,101	6,904,498	2,963,657	46,605,134

Fair Value Measurements - Level 3 Warrants (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Transfers between fair value levels	$ 0	$ 0
Warrants
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Beginning balance	5,696
Warrants issued	3,888
Warrants exercised	(3,480)
Change in fair value	4,543
Ending balance	$ 10,647

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2024	Aug. 12, 2024
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2024
Document Transition Report	false
Entity File Number	001-36464
Entity Registrant Name	AGILE THERAPEUTICS INC
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	23-2936302
Entity Address, Address Line One	500 College Road East, Suite 300
Entity Address, City or Town	Princeton
Entity Address, State or Province	NJ
Entity Address, Postal Zip Code	08540
City Area Code	609
Local Phone Number	683-1880
Title of 12(g) Security	Common Stock, par value $0.0001 per share
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		6,904,498
Entity Central Index Key	0001261249
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Amendment Flag	false

Statements of Operations and Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Statements of Operations and Comprehensive Income (Loss)
Revenues, net	$ 5,576	$ 5,503	$ 11,292	$ 9,316
Cost of product revenues	1,496	2,307	3,176	4,310
Gross profit	4,080	3,196	8,116	5,006
Operating expenses:
Research and development	538	703	1,033	1,466
Selling and marketing	3,776	4,570	7,460	9,240
General and administrative	2,512	3,049	5,129	6,133
Total operating expenses	6,826	8,322	13,622	16,839
Loss from operations	(2,746)	(5,126)	(5,506)	(11,833)
Other income (expense)
Interest income	28	15	52	48
Interest expense		(372)	(185)	(773)
Unrealized (loss) gain on warrant liability	(9,154)	1,674	(4,951)	3,361
Total other income (expense), net	(9,126)	1,317	(5,084)	2,636
Loss before benefit from income taxes	(11,872)	(3,809)	(10,590)	(9,197)
Net loss and comprehensive loss	$ (11,872)	$ (3,809)	$ (10,590)	$ (9,197)
Net loss per share (basic) (in dollars per share)	$ (1.73)	$ (2.15)	$ (1.84)	$ (6.85)
Net loss per share (diluted) (in dollars per share)	$ (1.73)	$ (2.15)	$ (1.84)	$ (6.85)
Weighted-average common shares (basic) (in shares)	6,856,229	1,769,803	5,744,066	1,343,293
Weighted-average common shares (diluted) (in shares)	6,856,229	1,769,803	5,744,066	1,343,293

Fair Value Measurements

6 Months Ended

Jun. 30, 2024

Fair Value Measurements

Fair Value Measurements

3. Fair Value Measurements

ASC 820, Fair Value Measurements and Disclosures, describes the fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value.

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Assets and liabilities that are measured at fair value are reported using a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy maximizes the

use of observable inputs and minimizes the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:

●

Level 1 — Quoted prices in active markets for identical assets or liabilities. The Company’s Level 1 assets consist of cash and cash equivalents. The Company has no Level 1 liabilities.

●

Level 2 — Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted market prices for similar assets or liabilities in active markets or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets and liabilities. The Company has no Level 2 assets or liabilities.

●

Level 3 — Unobservable inputs that are supported by little or no market data and which require internal development of assumptions about how market participants price the fair value of the assets or liabilities. The Company has no Level 3 assets. Level 3 liabilities consist of warrant liability.

The following table sets forth the Company’s financial instruments measured at fair value by level within the fair value hierarchy as of June 30, 2024 and December 31, 2023 (in thousands):


	Level 1		Level 2		Level 3
June 30, 2024
Assets:
Cash and cash equivalents	$	2,848	$	—	$	—
Total assets at fair value	$	2,848	$	—	$	—

Liabilities:
Warrant Liability	$	—	$	—	$	10,647
Total assets at fair value	$	—	$	—	$	10,647


	Level 1		Level 2		Level 3
December 31, 2023
Assets:
Cash and cash equivalents	$	2,557	$	—	$	—
Total assets at fair value	$	2,557	$	—	$	—

Liabilities:
Warrant Liability	$	—	$	—	$	5,696
Total assets at fair value	$	—	$	—	$	5,696

The fair value of the warrant liability as of June 30, 2024 was calculated using a probability-weighted model incorporating the probability of completion of the Merger, the terms included in the cash-out acknowledgment and cancellation agreements described in Note 10 and the option pricing model. The significant assumptions used in preparing the option pricing model for valuing the Company’s warrants as of June 30, 2024 include (i) volatility 105.3% - 433.0%, (ii) risk-free interest rate 4.3% - 4.7%, (iii) strike price for the common warrants of $1.00, $1.56, $2.09, $3.69, $4.94 and $45.00, (iv) fair value of common stock of $0.33 and $1.52 and (v) expected life 1.2 – 4.9 years. The significant assumptions used in preparing the option pricing model for valuing the Company’s warrants as of December 31, 2023 include (i) volatility 101.5% - 126.0%, (ii) risk-free interest rate 3.8% - 4.0%, (iii) strike price for the common warrants $3.69, $45.00 and $1,700, (iv) fair value of common stock of $1.95 and (v) expected life 2.8 – 4.4 years.

The following is a roll forward of the fair value of Level 3 warrants:


Beginning balance at December 31, 2023	$	5,696
Warrants issued		3,888
Warrants exercised		(3,480)
Change in fair value		4,543
Ending balance June 30, 2024	$	10,647

There were no transfers between Level 1, 2 or 3 during the six months ended June 30, 2024 or 2023.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Prepaid Expenses and Other Current Assets (Tables)

6 Months Ended

Jun. 30, 2024

Prepaid Expenses and Other Current Assets

Schedule of prepaid expenses and other current assets

Prepaid expenses and other current assets consist of the following (in thousands):


	June 30,		December 31,
	2024		2023
Prepaid insurance	$	134	$	441
Other		1,118		402
Total prepaid expenses and other current assets	$	1,252	$	843

Summary of Significant Accounting Policies - Inventory (Details) - USD ($) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2024	Dec. 31, 2023
Summary of Significant Accounting Policies
Inventory reserve	$ 1.4	$ 1.4

Credit Agreement and Guaranty (Details)						1 Months Ended	2 Months Ended	4 Months Ended	6 Months Ended
Credit Agreement and Guaranty (Details)	Mar. 11, 2024 USD ($)	Jul. 25, 2022 USD ($)	Jul. 08, 2022 USD ($)	Jan. 07, 2022 USD ($)	Feb. 10, 2020 USD ($) item Y $ / shares shares	Feb. 10, 2024 USD ($)	Dec. 31, 2023 USD ($) Y	Oct. 31, 2023 USD ($)	Jun. 30, 2024 USD ($) $ / shares Y	Jun. 30, 2023 USD ($)	Feb. 22, 2024 $ / shares	Mar. 31, 2022 shares	Oct. 31, 2021 shares	Feb. 26, 2021 $ / shares shares
Credit Agreement and Guaranty
Repayments of debt									$ 1,650,000	$ 450,000
Exercise price of warrants (in dollars per share) \| $ / shares											$ 1.25
Common stock that can be purchased with warrants (in shares) \| shares												24,856	6,660
Proceeds from warrant exercises					$ 20,000,000.0				4,376,000	$ 6,509,000
Perceptive Credit Agreement
Credit Agreement and Guaranty
Outstanding line of credit									0
Repayments of debt	$ 1,350,000		$ 5,000,000.0	$ 5,000,000.0
Principal payments on its outstanding								$ 150,000
Prepayment of outstanding principal		$ 7,000,000.0
Variable interest rate margin (as a percent)					10.25%
Perceptive Credit Agreement \| Perceptive Warrants
Credit Agreement and Guaranty
Exercise price of warrants (in dollars per share) \| $ / shares														$ 5,740
Common stock that can be purchased with warrants (in shares) \| shares					700									225
Number of warrants issued \| item					2
Facility fee percentage					1.00%
Perceptive Credit Agreement \| First Seven Lakhs Shares
Credit Agreement and Guaranty
Exercise price of warrants (in dollars per share) \| $ / shares					$ 7,480
Common stock that can be purchased with warrants (in shares) \| shares					350
Perceptive Credit Agreement \| Remaining Seven Lakhs Shares
Credit Agreement and Guaranty
Exercise price of warrants (in dollars per share) \| $ / shares					$ 9,340
Common stock that can be purchased with warrants (in shares) \| shares					350
Senior secured delayed draw term loan facility \| Perceptive Credit Agreement
Credit Agreement and Guaranty
Maximum borrowing capacity					$ 35,000,000.0
Senior secured delayed draw term loan facility \| Perceptive Credit Agreement, Tranche One
Credit Agreement and Guaranty
Amount borrowed					5,000,000.0
Senior secured delayed draw term loan facility \| Perceptive Credit Agreement, Tranche Two
Credit Agreement and Guaranty
Amount borrowed					15,000,000.0
Prepayment Occur on or Before February, 10, 2024 \| Perceptive Credit Agreement
Credit Agreement and Guaranty
Minimum cash covenants						$ 3,000,000.0	$ 1,000,000.0	$ 500,000
Revenue generated under debt									$ 5,000,000.0
Two Thousand Twenty Perceptive Warrants [Member]
Credit Agreement and Guaranty
Fair value of warrants					3,600,000
Two Thousand Twenty One Perceptive Warrants [Member]
Credit Agreement and Guaranty
Beneficial ownership percentage									19.99%
Fair value of warrants					$ 1,100,000
Two Thousand Twenty One Perceptive Warrants Sixth Amendment [Member]
Credit Agreement and Guaranty
Exercise price of warrants (in dollars per share) \| $ / shares									$ 10.50
Two Thousand Twenty One Perceptive Warrants Seventh Amendment [Member]
Credit Agreement and Guaranty
Exercise price of warrants (in dollars per share) \| $ / shares									$ 1.82
Option pricing model \| Fair value
Credit Agreement and Guaranty
Warrants, Measurement Input							1.95
Option pricing model \| Maximum \| Risk free interest rate
Credit Agreement and Guaranty
Warrants, Measurement Input							4.0		4.7
Option pricing model \| Maximum \| Expected life
Credit Agreement and Guaranty
Warrants, Measurement Input \| Y							4.4		4.9
Option pricing model \| Minimum \| Risk free interest rate
Credit Agreement and Guaranty
Warrants, Measurement Input							3.8		4.3
Option pricing model \| Minimum \| Expected life
Credit Agreement and Guaranty
Warrants, Measurement Input \| Y							2.8		1.2
Option pricing model \| Common stock warrants \| Maximum \| Fair value
Credit Agreement and Guaranty
Warrants, Measurement Input \| $ / shares									1.52
Option pricing model \| Common stock warrants \| Minimum \| Fair value
Credit Agreement and Guaranty
Warrants, Measurement Input \| $ / shares									0.33
Option pricing model \| Two Thousand Twenty Perceptive Warrants [Member] \| Perceptive Warrants \| Volatility
Credit Agreement and Guaranty
Warrants, Measurement Input					70.0
Option pricing model \| Two Thousand Twenty Perceptive Warrants [Member] \| Perceptive Warrants \| Risk free interest rate
Credit Agreement and Guaranty
Warrants, Measurement Input \| item					1.47
Option pricing model \| Two Thousand Twenty Perceptive Warrants [Member] \| Perceptive Warrants \| Expected life
Credit Agreement and Guaranty
Warrants, Measurement Input \| Y					7
Option pricing model \| Two Thousand Twenty Perceptive Warrants [Member] \| Perceptive Warrants \| Fair value
Credit Agreement and Guaranty
Warrants, Measurement Input					8,020
Option pricing model \| Two Thousand Twenty Perceptive Warrants [Member] \| Maximum \| Perceptive Warrants \| Strike price
Credit Agreement and Guaranty
Warrants, Measurement Input					9,340
Option pricing model \| Two Thousand Twenty Perceptive Warrants [Member] \| Minimum \| Perceptive Warrants \| Strike price
Credit Agreement and Guaranty
Warrants, Measurement Input					7,480
Option pricing model \| Two Thousand Twenty One Perceptive Warrants [Member] \| Perceptive Warrants \| Volatility
Credit Agreement and Guaranty
Warrants, Measurement Input					103.5
Option pricing model \| Two Thousand Twenty One Perceptive Warrants [Member] \| Perceptive Warrants \| Risk free interest rate
Credit Agreement and Guaranty
Warrants, Measurement Input \| item					1.15
Option pricing model \| Two Thousand Twenty One Perceptive Warrants [Member] \| Perceptive Warrants \| Expected life
Credit Agreement and Guaranty
Warrants, Measurement Input \| Y					7
Option pricing model \| Two Thousand Twenty One Perceptive Warrants [Member] \| Perceptive Warrants \| Strike price
Credit Agreement and Guaranty
Warrants, Measurement Input					5,740
Option pricing model \| Two Thousand Twenty One Perceptive Warrants [Member] \| Perceptive Credit Agreement \| Expected life
Credit Agreement and Guaranty
Warrants, Measurement Input \| Y					7

Summary of Significant Accounting Policies - Warrants (Details) - shares	1 Months Ended
	Feb. 29, 2024	Jun. 30, 2024	Feb. 22, 2024	May 31, 2023	Jul. 31, 2022	Apr. 30, 2022	Mar. 31, 2022	Oct. 31, 2021	Feb. 28, 2021	Feb. 26, 2021	Feb. 29, 2020	Feb. 10, 2020
Warrants
Common stock that can be purchased with warrants (in shares)						4,243
Common stock that can be purchased with warrants (in shares)							24,856	6,660
Warrants Exercised	100,000
Public offering
Warrants
Common stock that can be purchased with warrants (in shares)				3,792,572	1,093,333
Common stock warrants \| Public offering
Warrants
Common stock that can be purchased with warrants (in shares)					433,333
Amended warrants
Warrants
Common stock that can be purchased with warrants (in shares)		3,800,000
Common stock that can be purchased with warrants (in shares)		3,800,000
Additional New Warrants
Warrants
Common stock that can be purchased with warrants (in shares)		1,005,560
New Common Stock Warrants
Warrants
Common stock that can be purchased with warrants (in shares)	7,785,144		7,785,144
Perceptive Credit Agreement \| Perceptive Warrants
Warrants
Common stock that can be purchased with warrants (in shares)									225		700
Common stock that can be purchased with warrants (in shares)										225		700

Fair Value Measurements - Warrant Valuation Assumptions (Details) - Option pricing model	Jun. 30, 2024 USD ($) $ / shares Y	Dec. 31, 2023 USD ($) Y
Fair value
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input		1.95
Common stock warrants \| Measurement Input, Exercise Price, One
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input	1.00	3.69
Common stock warrants \| Measurement Input, Exercise Price, two
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input	1.56	45.00
Common stock warrants \| Measurement Input, Exercise Price, three
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input	2.09	1,700
Common stock warrants \| Measurement Input, Exercise Price, four
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input	3.69
Common stock warrants \| Measurement Input, Exercise Price, five
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input	4.94
Common stock warrants \| Measurement Input, Exercise Price, six
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input	45.00
Maximum \| Option Volatility
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input	433.0	126.0
Maximum \| Risk free interest rate
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input	4.7	4.0
Maximum \| Expected life
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input \| Y	4.9	4.4
Maximum \| Common stock warrants \| Fair value
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input \| $ / shares	1.52
Minimum \| Option Volatility
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input	105.3	101.5
Minimum \| Risk free interest rate
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input	4.3	3.8
Minimum \| Expected life
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input \| Y	1.2	2.8
Minimum \| Common stock warrants \| Fair value
Significant assumptions used in valuation of the Company's warrants
Warrants, Measurement Input \| $ / shares	0.33

Commitments and Contingencies (Details) - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	Apr. 30, 2020	Dec. 31, 2023	Jun. 30, 2024
Commitments and Contingencies
Future purchase commitments			$ 209.4
Corium Agreement [Member]
Commitments and Contingencies
Quarterly minimum volume amount of product to be ordered	$ 5.6
Additional fee payable as a percentage of transfer price for units ordered	(25.00%)
Percentage of additional fee as penalty percent		25.00%
2024 and Each Year Thereafter			22.5
Guaranteed minimum revenue			10.0
2025 and Each Year Thereafter			$ 22.5

Leases

6 Months Ended

Jun. 30, 2024

Leases

Leases

6. Leases

The Company has no finance leases and one operating lease for its corporate headquarters in Princeton, NJ. The current lease commenced on December 1, 2021 and terminates on March 31, 2025. The lease provides the Company with an option to extend the lease for an additional five years. Under the terms of the lease, the Company pays base annual rent subject to a fixed dollar amount increase each year, a fixed monthly charge for electricity, and other normal operating expenses such as taxes, repairs, and maintenance. The Company evaluates renewal options at lease inception and on an ongoing basis and includes renewal options that it is reasonably certain to exercise in its expected lease terms when classifying leases and measuring lease liabilities. The lease does not require variable lease payments, residual value guarantees, or restrictive covenants.

The lease does not provide an implicit rate, therefore the Company used its incremental borrowing rate as the discount rate when measuring the operating lease liability. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of the lease.

Operating lease expense was $89,000 for each of the three months ended June 30, 2024 and 2023. Operating lease expense was $178,000 for each of the six months ended June 30, 2024 and 2023. Operating cash flows used for operating leases during the six months ended June 30, 2024 and 2023 were approximately $177,000 and $154,000 respectively. As of June 30, 2024, the weighted average remaining lease term was 0.75 years, and the weighted average discount rate was 11.8%.

Future minimum lease payments under non-cancellable leases as of June 30, 2024 were as follows (in thousands):


2024	$	199
2025		101
Total	$	300
Less: Interest		(11)
Present value of lease liability	$	289

Statements of Changes in Stockholders' Deficit (Parenthetical)	Apr. 10, 2023
Statements of Changes in Stockholders' Equity (Deficit)
Stockholders' Equity Note, Stock Split, Conversion Ratio	0.02

Summary of Significant Accounting Policies - Income Taxes (Details)	Jun. 30, 2024 USD ($)
Uncertainty in tax positions
Uncertain tax positions	$ 0

Credit Agreement and Guaranty (Tables)

6 Months Ended

Jun. 30, 2024

Credit Agreement and Guaranty

Schedule of carrying amount of term loan


	June 30,		December 31,
	2024		2023
Long-term debt	$	—	$	1,650
Debt issuance costs		—		(23)
Warrant discount		—		(112)
Total debt	$	—	$	1,515
Less, current portion		—		1,515
Long-term debt, less current portion	$	—	$	—

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

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-Paragraph 8
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-8

Reference 11: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-6

Reference 12: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 7
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-7

+ Details

Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2024

Fair Value Measurements

Schedule of financial instruments measured at fair value by level within the fair value hierarchy

The following table sets forth the Company’s financial instruments measured at fair value by level within the fair value hierarchy as of June 30, 2024 and December 31, 2023 (in thousands):


	Level 1		Level 2		Level 3
June 30, 2024
Assets:
Cash and cash equivalents	$	2,848	$	—	$	—
Total assets at fair value	$	2,848	$	—	$	—

Liabilities:
Warrant Liability	$	—	$	—	$	10,647
Total assets at fair value	$	—	$	—	$	10,647


	Level 1		Level 2		Level 3
December 31, 2023
Assets:
Cash and cash equivalents	$	2,557	$	—	$	—
Total assets at fair value	$	2,557	$	—	$	—

Liabilities:
Warrant Liability	$	—	$	—	$	5,696
Total assets at fair value	$	—	$	—	$	5,696

Schedule of rollforward of the fair value of Level 3 warrants


Beginning balance at December 31, 2023	$	5,696
Warrants issued		3,888
Warrants exercised		(3,480)
Change in fair value		4,543
Ending balance June 30, 2024	$	10,647

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Jun. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Prepaid Expenses and Other Current Assets

6 Months Ended

Jun. 30, 2024

Prepaid Expenses and Other Current Assets

Prepaid Expenses and Other Current Assets

4. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in thousands):


	June 30,		December 31,
	2024		2023
Prepaid insurance	$	134	$	441
Other		1,118		402
Total prepaid expenses and other current assets	$	1,252	$	843

Stockholders' Deficit (Tables)

6 Months Ended

Jun. 30, 2024

Stockholders' Deficit

Schedule of allocation of stock-based compensation expense

Stock-based compensation expense was allocated as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Cost of product revenues	$	17	$	28	$	36	$	57
Research and development		63		81		137		168
Selling and marketing		8		32		20		62
General and administrative		196		341		425		692
Total	$	284	$	482	$	618	$	979

Organization and Description of Business (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 25, 2024	Dec. 31, 2023
Nature of Operations
Accumulated deficit	$ 433,756		$ 423,168
Cash, cash equivalents and marketable securities	2,800
Working capital deficit	$ 11,800
Insud Pharma S.L \| Bridge loan
Nature of Operations
Maximum borrowing capacity		$ 8,000

- Definition

Amount of accumulated undistributed earnings (deficit).

+ References + Details

Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2024	Dec. 31, 2023
Balance Sheets
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, authorized (in shares)	10,000,000	10,000,000
Preferred stock, issued (in shares)	4,850	0
Preferred stock, outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, authorized (in shares)	300,000,000	300,000,000
Common stock, issued (in shares)	6,904,498	2,963,657
Common stock, outstanding (in shares)	6,904,498	2,963,657

Accrued Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Accrued Liabilities
Gross to net accruals	$ 7,507	$ 6,492
Accrued compensation	954	832
Accrued professional fees and other	935	1,807
Total accrued liabilities	$ 9,396	$ 9,131

Stockholders' Deficit - Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands						1 Months Ended	3 Months Ended		5 Months Ended	6 Months Ended
	Feb. 22, 2024	Dec. 03, 2023	Aug. 22, 2022	Apr. 27, 2022	Feb. 10, 2020	May 31, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2024	Jun. 30, 2023	Feb. 29, 2024	Dec. 31, 2023	Apr. 12, 2023	Mar. 31, 2022	Oct. 31, 2021	Oct. 02, 2020
Stockholders' Equity (Deficit)
Common stock that can be purchased with warrants (in shares)															24,856	6,660
Exercise price of warrants (in dollars per share)	$ 1.25
Proceeds from Warrant Exercises					$ 20,000					$ 4,376	$ 6,509
Common stock, par value (in dollars per share)										$ 0.0001			$ 0.0001
Stock stated value										$ 0.0001			$ 0.0001
Maximum
Stockholders' Equity (Deficit)
Proceeds from issuance of common stock in public offering, net of offering costs			$ 75,000
Common stock
Stockholders' Equity (Deficit)
Stock Issued During Period, Shares, Warrants Exercised							508,286
Amended warrants
Stockholders' Equity (Deficit)
Common stock that can be purchased with warrants (in shares)										3,800,000
Warrants with five year term
Stockholders' Equity (Deficit)
Common stock that can be purchased with warrants (in shares)	3,992,572
Warrants and rights outstanding, term	5 years
Warrants with eighteen months term
Stockholders' Equity (Deficit)
Common stock that can be purchased with warrants (in shares)	3,792,572
Warrants and rights outstanding, term	18 months
New Common Stock Warrants
Stockholders' Equity (Deficit)
Common stock that can be purchased with warrants (in shares)	7,785,144											7,785,144
Exercise price of warrants (in dollars per share)	$ 1.00	$ 3.69
Proceeds from Warrant Exercises	$ 4,800
Number of warrants agreed to exercise for cash		3,892,572
Common stock, par value (in dollars per share)		$ 0.0001
Additional New Warrants
Stockholders' Equity (Deficit)
Common stock that can be purchased with warrants (in shares)										1,005,560
Exercise price of warrants (in dollars per share)										$ 2.09
Placement Agent Warrants
Stockholders' Equity (Deficit)
Common stock that can be purchased with warrants (in shares)	194,629
Exercise price of warrants (in dollars per share)	$ 1.5625
Cash fee percentage	7.00%
Management fee percentage	1.00%
Stock issuable as a percentage on warrants exercised	5.00%
2020 Shelf Registration Statement
Stockholders' Equity (Deficit)
Aggregate amount of securities issuable																	$ 200,000
At-the-market sales \| Common stock
Stockholders' Equity (Deficit)
Issuance of common stock (in shares)							105,342	72,699
At-the-market sales \| Common stock \| Maximum
Stockholders' Equity (Deficit)
Commission percentage				3.00%
Authorized value for shares issuance				$ 12,800
Public offering
Stockholders' Equity (Deficit)
Issuance of common stock (in shares)						3,792,572
Share price (in dollars per share)						$ 3.9551
Public offering \| Common stock
Stockholders' Equity (Deficit)
Issuance of common stock (in shares)						95,000	95,000
Proceeds from issuance of common stock in public offering, net of offering costs						$ 6,500
Public offering \| Pre-funded warrants
Stockholders' Equity (Deficit)
Common stock that can be purchased with warrants (in shares)						1,801,286
2022 ATM
Stockholders' Equity (Deficit)
Issuance of common stock (in shares)									173,750		178,041
Proceeds from issuance of common stock in public offering, net of offering costs									$ 12,200	$ 1,700
Eligible Amount Authorized To Sell														$ 4,500
H.C. Wainwright & Co., LLC, Sales Agent [Member]
Stockholders' Equity (Deficit)
Common stock that can be purchased with warrants (in shares)						94,814
Commission percentage						7.00%
Exercise price of warrants (in dollars per share)						$ 4.9439

Summary of Significant Accounting Policies - Deferred Financing Costs (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Interest expense
Deferred Financing Costs
Amortization of deferred financing costs	$ 0	$ 49,000	$ 23,000	$ 102,000

Summary of Significant Accounting Policies - Net Loss Per Share (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Anti-dilutive securities
Anti-dilutive securities excluded from the calculation of diluted net loss per share (in shares)	9,823,057	5,195,967	9,823,057	5,195,967
Common stock warrants
Anti-dilutive securities
Anti-dilutive securities excluded from the calculation of diluted net loss per share (in shares)	9,676,830	5,017,410	9,676,830	5,017,410
Unvested restricted stock units
Anti-dilutive securities
Anti-dilutive securities excluded from the calculation of diluted net loss per share (in shares)	103,373	135,047	103,373	135,047
Common stock options
Anti-dilutive securities
Anti-dilutive securities excluded from the calculation of diluted net loss per share (in shares)	42,854	43,510	42,854	43,510

Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2024

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

The Company’s complete listing of significant accounting policies is described in Note 2 to the Company’s audited financial statements as of December 31, 2023 included in its Annual Report on Form 10-K filed with the SEC on March 28, 2024.

Use of Estimates

The preparation of the Company’s financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The Company bases its estimates and judgments on historical experience and various other assumptions that it believes are reasonable under the circumstances. The amounts of assets and liabilities reported in the Company’s balance sheets and the amounts of revenue and expenses reported for each of the periods presented are affected by estimates and assumptions, which are used for, but not limited to, revenue recognition, inventory reserves, the accounting for common stock warrants, stock-based compensation, and accounting for research and development costs. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates.

Risks and Uncertainties

While Twirla has been approved by the FDA, other potential product candidates developed by the Company will require approval from the FDA prior to commercial sales. There can be no assurance that the Company’s other product candidates will receive the required approval. If the Company is denied approval or such approval is delayed, or is unable to obtain the necessary financing to complete development and approval, there could be a material adverse impact on the Company’s financial condition and results of operations.

Cash and Cash Equivalents

The Company considers all highly-liquid investments with an original maturity of three months or less when purchased to be cash equivalents. All cash and cash equivalents are held in United States financial institutions. Cash and cash equivalents include money market funds that invest primarily in commercial paper and U.S. government and U.S. government agency obligations.

The Company maintains balances with financial institutions in excess of the Federal Deposit Insurance Corporation limit.

Accounts Receivable and Allowances

Accounts receivable are amounts owed to the Company by its customers for product that has been delivered. The accounts receivable are recorded at the invoice amount, less prompt pay and other discounts, chargebacks, and an allowance for credit losses, if any. The allowance for credit losses represents the Company’s estimate of losses over the life of the receivables. The Company evaluates forward-looking economic factors and uses professional judgment to determine the allowance for credit losses. The credit loss reserves are reviewed and adjusted periodically. Credit loss reserves were not material as of June 30, 2024 and December 31, 2023, respectively.

Accounts receivable are aged based on the contractual payment terms. When the collectability of an invoice is no longer probable, the Company will create a reserve for that specific receivable. If a receivable is determined to be uncollectible, it is charged against the general credit loss reserve or the reserve for the specific receivable, if one exists.

Fair Value of Financial Instruments

In accordance with Accounting Standards Codification (“ASC”) 825, Financial Instruments, disclosures of fair value information about financial instruments are required, whether or not recognized in the balance sheet, for which it is practicable to estimate that value. Cash and cash equivalents (see Note 3) and the Company’s warrant liability (see Note 3) are carried at fair value. The warrant liability is measured at fair value in accordance with ASC 815.

Other financial instruments, including accounts receivable, accounts payable and accrued liabilities, are carried at cost, which approximates fair value given their short-term nature.

Inventory

Inventory is valued utilizing the weighted average costing method. The Company records an inventory reserve for losses associated with dated, expired, excess or obsolete items. This reserve is based on management’s current knowledge with respect to inventory levels, planned production and sales volume assumptions. As of June 30, 2024 and December 31, 2023, inventory reserves approximated $1.4 million and $1.4 million, respectively.

Long-Lived Assets

In accordance with ASC 360, Property, Plant and Equipment, the Company’s policy is to review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Management does not believe the carrying values of any long-lived assets are impaired as of June 30, 2024.

Research and Development Expenses

Research and development costs are expensed as incurred. Research and development expense consists primarily of costs related to personnel, including salaries and other personnel-related expenses, expenses related to manufacturing, clinical trial expenses, consulting fees, and support services used in drug development. All research and development costs are charged to operations as incurred in accordance with ASC 730, Research and Development.

In certain circumstances, the Company is required to make advance payments to vendors for goods or services that will be received in the future for use in research and development activities. In such circumstances, the advance payments are deferred and are expensed when the activity has been performed or when the goods have been received.

Advertising Costs

The Company has elected to expense advertising costs when incurred. Advertising costs totaled zero for each of the three and six months ended June 30, 2024 and 2023, respectively.

Deferred Financing Costs

Costs directly attributable to the Company’s senior secured term loan (see Note 7) are deferred and reported as a reduction of the related term loan. These costs represent legal fees and other costs related to the term loan and are being amortized utilizing the straight-line method over the term of the loan. Amortization of deferred financing costs charged to interest expense was zero and approximately $49,000 for the three months ended June 30, 2024 and 2023, respectively and was approximately $23,000 and $102,000 for the six months ended June 30, 2024 and 2023, respectively.

Concentrations of Credit Risk

Financial instruments, which potentially subject the Company to credit risk, consist principally of cash, cash equivalents, and accounts receivable. The Company invests its cash and cash equivalents in interest-bearing accounts in United States financial institutions, the balances of which exceed federally insured limits. The Company mitigates credit risk by limiting the investment type and maturity to securities that preserve capital, maintain liquidity, and have a high credit quality. The Company has not recognized any losses from credit risks on such accounts. The Company has no financial instruments with off balance sheet risk of accounting loss.

Major customers of the Company are defined as those constituting greater than 10% of its total revenue. In the three months ended June 30, 2024, the Company had sales to six customers that individually accounted for more than 10% of its total revenue. These customers had sales of $1.1 million, $1.0 million, $1.0 million, $0.8 million, $0.7 million, and $0.5 million, respectively, which represented 92% of total revenues in the three months ended June 30, 2024. In the six months ended June 30, 2024, the Company had sales to six customers that individually accounted for more than 10% of its total revenue. These customers had sales of $2.1 million, $2.0 million, $1.8 million, $1.7 million, $1.6 million, and $1.3 million, respectively, which represented 93% of total revenues in the six months ended June 30, 2024. Accounts receivable related to these six customers totaled 97% of the Company’s total accounts receivable as of June 30, 2024. In the three months ended June 30, 2023, the Company had sales to four customers that individually accounted for more than 10% of its total revenue. These customers had sales of $1.3 million, $1.2 million, $1.1 million and $0.8 million, respectively, which represented 83% of total revenues in the three months ended June 30, 2023. In the six months ended June 30, 2023, the Company had sales to four customers that individually accounted for more than 10% of its total revenue. These customers had sales of $2.2 million, $2.1 million, $1.9 million and $1.9 million, respectively, which represented 87% of total revenues in the six months ended June 30, 2023.

Revenue Recognition

The Company recognizes revenue from the sale of its product, Twirla, in accordance with ASC 606, Revenue from Contracts with Customers (ASC 606). The provisions of ASC 606 require the following steps to determine revenue recognition: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation.

In accordance with ASC 606, the Company recognizes revenue at the point in time when its performance obligation is satisfied by transferring control of the promised goods or services to a customer. In accordance with the Company’s contracts with customers, control of the product is transferred upon the conveyance of title, which occurs when the product is sold to and received by a customer. The Company’s customers are located in the United States and consist primarily of wholesale distributors. Accounts receivable due to the Company from contracts with its customers are stated separately in the balance sheet, net of various allowances as described later in this section and in the Accounts Receivable and Allowance policy.

The amount of revenue recognized by the Company is equal to the amount of consideration that is expected to be received from the sale of product to its customers. Revenue is only recognized when it is probable that a significant reversal will not occur in future periods. To determine whether a significant reversal will occur in future periods, the Company assesses both the likelihood and magnitude of any such potential reversal of revenue.

Twirla is sold to customers at the wholesale acquisition cost (“WAC”). However, the Company records product revenue, net of reserves for applicable variable consideration. These types of variable consideration items reduce revenue and include the following:

●

Distribution services fees;

●

Prompt pay and other discounts;

●

Product returns;

●

Chargebacks;

●

Rebates; and

●

Co-payment assistance.

An estimate for each variable consideration item is made and is recorded in conjunction with the revenue being recognized. Generally, if the estimated amount is payable to a customer, it is recorded as a reduction to accounts receivable. If the estimated amount is payable to an entity other than a customer, it is recorded as a current liability. An estimated amount of variable consideration may differ from the actual amount. At each balance sheet date, these provisions are analyzed, and adjustments are made if necessary. Any adjustments made to these provisions would affect net product revenue and earnings in the current period.

In accordance with ASC 606, the Company must make judgments to determine the estimate for certain variable consideration. For example, the Company must estimate the percentage of end-users that will obtain the product through public insurance such as Medicaid or through private commercial insurance. To determine these estimates, the Company relied on quantitative and qualitative data from various internal and external sources to estimate its variable consideration.

The specific considerations that the Company uses in estimating these amounts related to variable considerations are as follows:

Distribution services fees – The Company pays distribution service fees primarily to its wholesale distributors. These fees are a contractually fixed percentage of WAC and are calculated at the time of sale based on the purchase amount. The Company records these fees as contra accounts receivable on the balance sheet.

Prompt pay and other discounts – The Company incentivizes its customers to pay their invoices on time through prompt pay discounts. These discounts are an industry standard practice and the Company offers a prompt pay discount to each wholesale distributor customer. The specific prompt pay terms vary by customer and are contractually fixed. Prompt pay discounts are typically taken by the Company’s customers, so an estimate of the discount is recorded at the time of sale based on the WAC. Prompt pay discount estimates are recorded as contra accounts receivable on the balance sheet.

The Company may also give other discounts to its customers to incentivize purchases and promote customer loyalty. The terms of such discounts may vary by customer. These discounts reduce gross product revenue at the time the revenue is recorded.

Product returns – Customers have the right to return product that is within six months or less of the labeled expiration date or that is past the expiration date by no more than twelve months. Twirla was commercially launched in December 2020, an estimate for product returns as of June 30, 2024 was made based on: (i) data provided to the Company by its distributors (including weekly reporting of distributors’ sales and inventory held by distributors that provided the Company with visibility into the distribution channel in order to determine what quantities were sold to retail pharmacies and other providers), (ii) information provided to the Company from retail pharmacies, (iii) data provided to the Company by third-parties including a third-party data provider which collects and publishes prescription data (iv) expired returns credits issued to date, and (v) the estimated remaining shelf life of Twirla previously shipped and currently being shipped to distributors. Estimated product returns are recorded as accrued expenses on the balance sheet.

Chargebacks – Certain covered entities and government entities will be able to purchase the product at a price discounted below WAC. The difference between the government or covered entity purchase price and the wholesale

distributor purchase price of WAC will be charged back to the Company. The Company estimates the amount in chargebacks based on the expected number of claims and related cost that is associated with the revenue being recognized for product that remains in the distribution channel at the end of each reporting period. Estimated chargebacks are recorded as contra accounts receivable on the balance sheet.

Rebates – The Company is subject to mandatory and negotiated discount obligations under the Medicaid and VA/DOD programs. The rebate amounts for these programs are determined by statutory requirements or contractual arrangements. Rebates are owed after the product has been dispensed to an end user and the Company has been invoiced. Rebates are typically invoiced in arrears. The Company’s liability for these rebates consists of invoices received for claims from prior quarters that have not been paid or for which an invoice has not yet been received, estimates of claims for the current quarter, and estimated future claims that will be made for product that has been recognized as revenue, but remains in the distribution channel at the end of each reporting period. Rebate estimates are recorded as accrued expenses on the balance sheet.

Co-payment assistance – The Company offers a co-payment assistance program to commercially insured patients whose insurance requires a co-payment to be made when filling their prescription. This is a voluntary program that is intended to provide financial assistance to patients meeting certain eligibility requirements. The Company estimates the amount of co-payment assistance based on the expected number of claims and related cost that is associated with the revenue being recognized for product that remains in the distribution channel at the end of each reporting period. Co-payment assistance estimates are recorded as accrued expenses on the balance sheet.

Provisions for the revenue reserves described above totaled $7.2 million and $6.3 million for the three months ended June 30, 2024 and 2023, respectively, and $15.9 million and $10.8 million for the six months ended June 30, 2024 and 2023, respectively. As of June 30, 2024, reserves on the balance sheet associated with variable consideration were $7.5 million.

Warrants

The Company accounts for its warrants to purchase common stock in accordance with ASC 480, Distinguishing Liabilities from Equity.

In connection with entering into a senior secured term loan facility in February 2020 (the “Perceptive Credit Agreement”), the Company issued warrants to purchase 700 shares of its common stock to the lender, Perceptive Credit Holdings III, L.P. (“Perceptive”). In connection with an amendment to that facility in February 2021, the Company issued warrants to purchase 225 shares of the Company’s common stock (collectively, the “Perceptive Warrants”). The Perceptive Warrants qualify for equity classification and have been allocated based upon the relative fair value of the base instrument and the warrant. In March 2023, in connection with the Waiver and Sixth Amendment to the Perceptive Credit Agreement, the Company amended and restated the Perceptive Warrants to reset the strike price of the Perceptive Warrants. In October 2023, in connection with the Seventh Amendment to the Perceptive Credit Agreement, the Company reset the strike price of the Perceptive Warrants. See Notes 7 and 8 for additional information.

In connection with an underwritten public offering completed in October 2021, the Company issued warrants to purchase 6,660 shares of its common stock. These warrants are classified as liabilities and were measured at fair value upon issuance, with subsequent changes in fair value reported in the Statements of Operations and Comprehensive Income (Loss) each reporting period. This offering also triggered an adjustment to the exercise price of the Perceptive Warrants, which resulted in a reduction of the strike price for these warrants. This reduction resulted in an immaterial increase to additional paid-in-capital. See Notes 7 and 8 for additional information.

In connection with a registered direct offering completed in March 2022, the Company issued warrants to purchase 24,856 shares of its common stock. These warrants are classified as liabilities and were measured at fair value upon issuance, with subsequent changes in fair value reported in the Statement of Operations and Comprehensive Income (Loss) each reporting period. This offering also triggered an adjustment to the exercise price of the Perceptive Warrants, which resulted in a reduction of the strike price for these warrants. This reduction resulted in an immaterial increase to additional paid-in-capital. See Notes 7 and 8 for additional information.

In connection with a letter agreement and waiver entered into with an investor on April 2022, the Company issued warrants to purchase 4,243 shares of common stock. These warrants are classified as liabilities and were measured at fair value upon issuance, with subsequent changes in fair value reported in the Statement of Operations and Comprehensive Income (Loss) each reporting period. See Note 8 for additional information.

In connection with a public offering completed in July 2022, the Company issued warrants to purchase 1,093,333 shares of its common stock, of which 433,333 warrants expired unexercised in July 2023. In February 2024, 100,000 of these warrants were exercised (see Note 8). These warrants are classified as liabilities and were measured at fair value upon issuance, with subsequent changes in fair value reported in the Statement of Operations and Comprehensive Income (Loss) each reporting period. This offering also triggered an adjustment to the exercise price of the Perceptive Warrants, which resulted in a reduction of the strike price for these warrants.

In connection with a public offering completed in May 2023, the Company issued warrants to purchase 3,792,572 shares of its common stock. These warrants are classified as liabilities, were measured at fair value upon issuance, with subsequent changes in fair value reported in the Statement of Operations and Comprehensive Income (Loss) each reporting period. These warrants were exercised in February 2024 (see Note 8). This offering also triggered an adjustment to the exercise price of the Perceptive Warrants, which resulted in a reduction of the strike price for these warrants.

On December 3, 2023, the Company entered into a Warrant Amendment and Additional Issuance Agreement (“Warrant Amendment and Additional Issuance Agreement”) relating to the amendment of warrants to purchase shares of common stock that were issued in transactions on March 14, 2022, April 25, 2022, and May 25, 2023 (collectively, the “Warrants”). Collectively, the Warrants represent the right to purchase approximately 3.8 million shares of common stock. See Note 8 for additional information.

In connection with a warrant exercise agreement with a certain holder of its common stock warrants completed in February 2024, the Company issued new unregistered warrants to purchase up to 7,785,144 shares of common stock. These warrants are classified as liabilities and were measured at fair value upon issuance, with subsequent changes in fair value reported in the Statement of Operations and Comprehensive Income (Loss) each reporting period. See Note 8 for additional information.

Income Taxes

The Company accounts for deferred taxes using the asset and liability method as specified by ASC 740, Income Taxes. Deferred income tax assets and liabilities are determined based on differences between the financial statement reporting and the tax basis of assets and liabilities, operating losses and tax credit carryforwards. Deferred income taxes are measured using the enacted tax rates and laws that are anticipated to be in effect when the differences are expected to reverse. The measurement of deferred income tax assets is reduced, if necessary, by a valuation allowance for any tax benefits which are not expected to be realized. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in the period that such tax rate changes are enacted.

The Company has adopted the authoritative guidance on accounting for and disclosure of uncertainty in tax positions, which prescribes a comprehensive model for the financial statement recognition, measurement, presentation, and disclosure of uncertain tax positions taken or expected to be taken in income tax returns. The Company has no uncertain tax positions as of June 30, 2024 that qualify for either recognition or disclosure in the financial statements under this guidance.

Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with ASC 718, Compensation-Stock Compensation. The Company grants stock options for a fixed number of shares to employees and non-employees with an exercise price equal to the fair value of the shares at grant date. Compensation cost is recognized for all share-based payments granted and is based on the grant-date fair value estimated using the weighted-average assumption of the Black-Scholes option pricing model based on key assumptions such as stock price, expected volatility and expected term. The Company elects to account for forfeitures when they occur. The equity instrument

is not considered to be issued until the instrument vests. As a result, compensation cost is recognized over the requisite service period with an offsetting credit to additional paid-in capital.

The Company also awards restricted stock units (“RSUs”) to employees and its Board. RSUs are generally subject to forfeiture if employment terminates prior to the completion of the vesting restrictions. The Company expenses the cost of the RSUs, which is determined to be the fair market value of the shares of common stock underlying the RSUs at the date of grant, ratably over the period during which the vesting restrictions lapse.

Net Income (Loss) Per Share

Basic net income (loss) per share is calculated by dividing the net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding for the period, without consideration for common stock equivalents. Diluted net income (loss) per share is calculated by dividing the net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding plus the effect of dilutive potential common shares outstanding during the period determined using the treasury-stock and if-converted methods. For purposes of the diluted net income (loss) per share calculation, common stock warrants, unvested RSUs and stock options are considered to be potentially dilutive securities but are excluded from the calculation of diluted net income (loss) per share because their effect would be anti-dilutive, and therefore, basic and diluted net income (loss) per share were the same for all periods presented.

The following table sets forth the outstanding potentially dilutive securities that have been excluded from the calculation of diluted net income (loss) per share for the three and six months ended June 30, 2024 and 2023, respectively, because to do so would be anti-dilutive (in common equivalent shares):


	June 30,
	2024	2023
Common stock warrants	9,676,830	5,017,410
Unvested restricted stock units	103,373	135,047
Common stock options	42,854	43,510
Total	9,823,057	5,195,967

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that the Company adopts as of the specified effective date. Unless otherwise discussed below, the Company does not believe that the adoption of recently issued standards have or may have a material impact on its consolidated financial statements or disclosures.

The Company did not adopt any new accounting pronouncements during the three months ended June 30, 2024 that had a material effect on its financial statements.

Merger with Insud Pharma, S.L. (Details) - USD ($) $ / shares in Units, $ in Thousands	Jun. 30, 2024	Jun. 25, 2024	Dec. 31, 2023
Merger with Insud Pharma, S.L.
Par value of common stock (in dollars per share)	$ 0.0001		$ 0.0001
Insud Pharma, S L and Exeltis Project, Inc
Merger with Insud Pharma, S.L.
Par value of common stock (in dollars per share)		$ 0.0001
Merger consideration per share in cash		$ 1.52
Termination fee payable		$ 1,260
Insud Pharma, S L and Exeltis Project, Inc \| Common stock warrants \| Minimum
Merger with Insud Pharma, S.L.
Percentage of warrants and rights outstanding		95.00%

Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2024

Summary of Significant Accounting Policies

Basis of Presentation

Use of Estimates

Risks and Uncertainties

Risks and Uncertainties

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company maintains balances with financial institutions in excess of the Federal Deposit Insurance Corporation limit.

Accounts Receivable and Allowances

Accounts Receivable and Allowances

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Other financial instruments, including accounts receivable, accounts payable and accrued liabilities, are carried at cost, which approximates fair value given their short-term nature.

Inventory

Inventory

Long-Lived Assets

Research and Development Expenses

Research and Development Expenses

Advertising Costs

Advertising Costs

The Company has elected to expense advertising costs when incurred. Advertising costs totaled zero for each of the three and six months ended June 30, 2024 and 2023, respectively.

Deferred Financing Costs

Deferred Financing Costs

Concentrations of Credit Risk

Concentrations of Credit Risk

Revenue Recognition

Revenue Recognition

●

Distribution services fees;

●

Prompt pay and other discounts;

●

Product returns;

●

Chargebacks;

●

Rebates; and

●

Co-payment assistance.

The specific considerations that the Company uses in estimating these amounts related to variable considerations are as follows:

Warrants

The Company accounts for its warrants to purchase common stock in accordance with ASC 480, Distinguishing Liabilities from Equity.

Income Taxes

Income Taxes

Stock-Based Compensation

is not considered to be issued until the instrument vests. As a result, compensation cost is recognized over the requisite service period with an offsetting credit to additional paid-in capital.

Net Income (Loss) Per Share


	June 30,
	2024	2023
Common stock warrants	9,676,830	5,017,410
Unvested restricted stock units	103,373	135,047
Common stock options	42,854	43,510
Total	9,823,057	5,195,967

Recent Accounting Pronouncements

The Company did not adopt any new accounting pronouncements during the three months ended June 30, 2024 that had a material effect on its financial statements.

Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2024

Summary of Significant Accounting Policies

Schedule of outstanding potentially dilutive securities excluded from calculation of diluted net loss per share


	June 30,
	2024	2023
Common stock warrants	9,676,830	5,017,410
Unvested restricted stock units	103,373	135,047
Common stock options	42,854	43,510
Total	9,823,057	5,195,967

Commitments and Contingencies

6 Months Ended

Jun. 30, 2024

Commitments and Contingencies

Commitments and Contingencies

9. Commitments and Contingencies

The Company has several firm purchase commitments, primarily related to the manufacture and supply of Twirla and the supply of a field force of sales representatives to provide certain detailing services, sales operation services, compliance services, and training services. Future firm purchase commitments under these agreements, the last of which ends in 2033, as well as the Company’s operating lease (see Note 6) total $209.4 million. This amount does not represent all of the Company’s anticipated purchases in the future, but instead represents only purchases that are the subject of contractually obligated minimum purchases. The minimum commitments disclosed are determined based on non-cancelable minimum spend in 2024 or termination amounts. Additionally, the Company purchases products and services as needed with no firm commitment.

In April 2020, the Company entered into a manufacturing and commercialization agreement with Corium (the “Corium Agreement”). Under the Corium Agreement, the Company has a requirement to order quarterly minimum volumes of approximately $5.6 million of product. In the event that the Company does not order the minimum volume, the Company is required to pay an additional fee equal to twenty-five percent (25%) per unit of the transfer price for all units ordered in that quarter. The Company did not meet the minimum volume order in the first or second quarter of 2022, and has, therefore, paid the additional 25% per unit fee as a penalty for all units ordered during the period. Based on then-current demand expectations for Twirla, the Company did not expect to meet the minimum volume order for the balance of 2022 and would be subject to the additional fee on future purchases. On July 25, 2022 the Company and Corium entered into Amendment No. 1 to the Corium Agreement (the “Amendment”) which was designed to restructure the contract minimums applicable to the purchase of manufactured Twirla and other services provided by Corium, transfer equipment ownership to Corium to support the manufacture of Twirla and extend the term of the Corium Agreement. Pursuant to the Amendment, the parties agreed to adjust the process for the Company providing Corium certain binding and non-binding forecasts required under the Corium Agreement. Additionally, Corium agreed not to enforce the original quantity minimums in the Corium Agreement, which were waived and replaced by new minimums based on Corium’s revenue for product purchased by the Company, expiring raw materials, and other services billed by Corium to support batch production and release. The guaranteed minimum revenue requirement for 2024 and each year thereafter was $22.5 million. On May 13, 2024, the Company and Corium entered into Amendment No. 2 to the Corium Agreement, which reset the guaranteed minimum revenue requirement for 2024 to $10.0 million. The transfer price for Twirla will be higher for the remainder of 2024 to support the lower guaranteed minimum revenue requirement. The guaranteed minimum revenue requirement for 2025 and beyond will return to $22.5 million per year. In the event that the Company does not meet the guaranteed minimum revenue requirements in any given year, the Company will be required to make additional payments to Corium for the shortfall. The Company agreed to make certain monthly supplemental payments to Corium through December 2023, which payments are eligible to be retroactively reduced based upon product orders placed by the Company during 2023 meeting certain designated thresholds. In connection with the supplemental payments, Corium will retain the proceeds for the sale of certain raw materials to which the Company would otherwise have economic right to offset such supplemental payments. Further, the Company agreed to reimburse Corium for any unused raw materials in the event the Company’s actual product requirements are lower than initially forecasted. Pursuant to the Amendment, the term of the Corium Agreement was extended to December 31, 2033. Pursuant to the Amendment, the parties agreed to transfer ownership of certain manufacturing equipment used in the manufacture of Twirla from the Company to Corium under a Bill of Sale dated July 25, 2022. On June 24, 2024, the Company and Corium entered into Amendment No. 3 (the “Third Amendment”) to the Corium

Agreement, which amends the Corium Agreement to account for Insud’s current projected production requirements for Twirla and the associated cost of goods and is conditioned upon, and effective as of, the consummation of the Merger.

The Company records a provision for contingent losses when it is both probable that a liability has been incurred, and the amount of the loss can be reasonably estimated. An unfavorable outcome to any legal matter, if material, could have an adverse effect on the Company's operations or its financial position. As of June 30, 2024, the Company has not recorded a provision for any contingent losses.

Statements of Changes in Stockholders' Equity (Deficit) - USD ($) $ in Thousands	Common stock Public offering	Common stock At-the-market sales	Common stock	Additional Paid-in Capital. At-the-market sales	Additional Paid-in Capital.	Accumulated Deficit	At-the-market sales	Total
Balance at Dec. 31, 2022					$ 403,157	$ (408,702)		$ (5,545)
Balance (in shares) at Dec. 31, 2022			859,402
Increase (decrease) in stockholders' equity
Share-based compensation - stock options and RSUs					498			498
Issuance of common stock				$ 1,003			$ 1,003
Issuance of common stock (in shares)		72,699
Net Income (Loss)						(5,389)		(5,389)
Balance at Mar. 31, 2023					404,658	(414,091)		(9,433)
Balance (in shares) at Mar. 31, 2023			932,101
Balance at Dec. 31, 2022					403,157	(408,702)		(5,545)
Balance (in shares) at Dec. 31, 2022			859,402
Increase (decrease) in stockholders' equity
Net Income (Loss)								(9,197)
Balance at Jun. 30, 2023					405,779	(417,900)		(12,121)
Balance (in shares) at Jun. 30, 2023			1,640,805
Balance at Mar. 31, 2023					404,658	(414,091)		(9,433)
Balance (in shares) at Mar. 31, 2023			932,101
Increase (decrease) in stockholders' equity
Share-based compensation - stock options and RSUs					482			482
Fractional shares retired as a result of reverse split					(13)			(13)
Issuance of common stock				$ 652			$ 652
Issuance of common stock (in shares)	95,000	105,342
Exercise of pre-funded warrants (in shares)			508,286
Vesting of RSUs (in shares)			76
Net Income (Loss)						(3,809)		(3,809)
Balance at Jun. 30, 2023					405,779	(417,900)		(12,121)
Balance (in shares) at Jun. 30, 2023			1,640,805
Balance at Dec. 31, 2023			$ 4		406,846	(423,168)		(16,318)
Balance (in shares) at Dec. 31, 2023			2,963,657
Increase (decrease) in stockholders' equity
Share-based compensation - stock options and RSUs					333			333
Issuance of common stock in connection with the exercise of common stock warrants, net of expenses			$ 1		4,376			4,377
Issuance of common stock in connection with the exercise of common stock warrants, net of expenses (shares)			3,892,572
Net Income (Loss)						1,284		1,284
Balance at Mar. 31, 2024			$ 5		411,555	(421,884)		(10,324)
Balance (in shares) at Mar. 31, 2024			6,856,229
Balance at Dec. 31, 2023			$ 4		406,846	(423,168)		(16,318)
Balance (in shares) at Dec. 31, 2023			2,963,657
Increase (decrease) in stockholders' equity
Net Income (Loss)								(10,590)
Balance at Jun. 30, 2024			$ 5		411,839	(433,756)		(21,912)
Balance (in shares) at Jun. 30, 2024			6,904,498
Balance at Mar. 31, 2024			$ 5		411,555	(421,884)		(10,324)
Balance (in shares) at Mar. 31, 2024			6,856,229
Increase (decrease) in stockholders' equity
Share-based compensation - stock options and RSUs					284			284
Vesting of RSUs (in shares)			48,269
Net Income (Loss)						(11,872)		(11,872)
Balance at Jun. 30, 2024			$ 5		$ 411,839	$ (433,756)		$ (21,912)
Balance (in shares) at Jun. 30, 2024			6,904,498

Leases - Maturity of lease liabilities (Details) $ in Thousands	Jun. 30, 2024 USD ($)
Operating Leases
2024	$ 199
2025	101
Total	300
Less: Interest	(11)
Present value of lease liability	$ 289

Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Prepaid Expenses and Other Current Assets
Prepaid insurance	$ 134	$ 441
Other	1,118	402
Total prepaid expenses and other current assets	$ 1,252	$ 843

Credit Agreement and Guaranty

6 Months Ended

Jun. 30, 2024

Credit Agreement and Guaranty

Credit Agreement and Guaranty

7. Credit Agreement and Guaranty

On February 10, 2020, the Company entered into a Credit Agreement and Guaranty with Perceptive Credit Holdings III, LP (“Perceptive”) for a senior secured term loan credit facility of up to $35.0 million (the “Perceptive Credit Agreement”). A first tranche of $5.0 million was funded on execution of the Perceptive Credit Agreement. A second tranche of $15.0 million was funded as a result of the approval of Twirla by the FDA. On January 7, 2022, the Company prepaid $5.0 million of the outstanding debt, and Perceptive waived the prepayment premium. On July 8, 2022, the Company prepaid $5.0 million of the outstanding debt, and Perceptive waived the prepayment premium. On July 25, 2022, the Company entered into a fifth amendment to the Perceptive Credit Agreement, as amended (the “Fifth Amendment”). Pursuant to the Fifth Amendment, Perceptive agreed to release its security interest in certain assets being transferred from the Company to Corium in connection with an amendment to the Company’s Manufacturing and Commercialization Agreement with Corium and waive the Company’s obligations to comply with certain financial covenants through the end of 2022. In exchange, the Company agreed to prepay $7.0 million of outstanding principal which was paid on July 25, 2022. On March 21, 2023, the Company and Perceptive entered into a sixth amendment to the Perceptive Credit Agreement (the “Sixth Amendment”). The Sixth Amendment waived the Company’s obligations to (1) comply with certain financial covenants relating to minimum revenue requirements and minimum liquidity through June 30, 2023, and (2) file financial statements along with its Annual Report on Form 10-K for the fiscal year ended December 31, 2022 that are not subject to any “going concern” qualification. On October 30, 2023, the Company and Perceptive entered into a seventh amendment to the Perceptive Credit Agreement (the “Seventh Amendment”). The Seventh Amendment: (1) amended the Company’s obligations to comply with certain financial covenants relating to minimum revenue requirements, (2) amended and waived the Company’s obligations to comply with certain financial covenants relating to minimum liquidity through December 31, 2023, and (3) required the Company to make principal payments on its outstanding loan balance of $150,000 per month beginning on December 1, 2023.

The facility was scheduled to mature on February 10, 2024 (“Maturity Date”) but was extended to March 11, 2024, pursuant to that certain eight amendment to the Perceptive Credit Agreement dated February 9, 2024. On March 11, 2024, the Company paid off the remainder of the principal balance of $1.35 million and has no borrowings outstanding under the Perceptive Credit Agreement as of June 30, 2024. The Perceptive Credit Agreement terminated upon repayment of the remaining balance.

Borrowings under the Perceptive Credit Agreement accrued interest at an annual rate equal to the Secured Overnight Financing Rate for one-month deposits (“SOFR”) plus 10.25%.

All of the Company’s obligations under the Perceptive Credit Agreement were secured by a first-priority lien and security interest in substantially all of the Company’s tangible and intangible assets, including intellectual property. The Perceptive Credit Agreement contained certain representations and warranties, affirmative covenants, negative covenants and conditions that are customary for similar financings. The negative covenants restricted or limited the ability of the Company to, among other things and subject to certain exceptions contained in the Perceptive Credit Agreement, incur new indebtedness; create liens on assets; engage in certain fundamental corporate changes, such as mergers or acquisitions, or changes to the Company’s business activities; make certain investments or restricted payments (each as defined in the Perceptive Credit Agreement); change its fiscal year; pay dividends; repay other certain indebtedness; engage in certain affiliate transactions; or enter into, amend or terminate any other agreements that have the impact of restricting the Company’s ability to make loan repayments under the Perceptive Credit Agreement. In addition, as amended by the Seventh Amendment, the Company must (i) at all times for the period from June 30, 2023 to October 31, 2023 maintain a minimum cash balance of $0.5 million for

the period from November 1, 2023 to December 31, 2023 maintain a minimum cash balance of $1.0 million, and after December 31, 2023 to the Maturity Date maintain a minimum cash balance of $3.0 million; and (ii) as of the last day of each fiscal quarter commencing with the fiscal quarter ending September 30, 2023, report net revenues for the trailing 12-month period that are not less than $5.0 million. Pursuant to the Seventh Amendment, the Company received a waiver of certain financial covenants through December 31, 2023.

In connection with the Perceptive Credit Agreement, the Company issued to Perceptive two warrants to purchase an aggregate of 700 shares of the Company’s common stock (together, the “2020 Perceptive Warrants”). The first warrant is exercisable for 350 shares of common stock at an exercise price of $7,480 per share. The second warrant is exercisable for 350 shares of common stock at an exercise price of $9,340 per share. The 2020 Perceptive Warrants expire on February 10, 2027. In connection with the Perceptive Credit Agreement, the Company issued to Perceptive a warrant to purchase 225 shares of the Company’s common stock (the “2021 Perceptive Warrant” and, together with the 2020 Perceptive Warrants, the “Perceptive Warrants”) at an exercise price of $5,740 per share. The 2021 Perceptive Warrant expires on February 26, 2028. In connection with the Sixth Amendment, the Company amended the Perceptive Warrants to reset the exercise price to $10.50 per warrant. In connection with the Seventh Amendment, the Company further amended the Perceptive Warrants to reset the exercise price to $1.82 per warrant. The Perceptive Warrants contain anti-dilution provisions and other warrant holder protections and are not exercisable to the extent that Perceptive would beneficially own more than 19.99% of the Company’s common stock because of the exercise.

The Company allocated the proceeds of $20.0 million in accordance with ASC 470 based on the relative fair values of the debt and the Perceptive Warrants. The relative fair value of the Perceptive Warrants of approximately $3.6 million at the time of issuance, which was determined using the Black-Scholes option-pricing model, was recorded as additional paid-in capital and reduced the carrying value of the debt. The significant assumptions used in the preparation of the option pricing model for valuing the Perceptive Warrants issued include (i) volatility (70.0%), (ii) risk free interest rate of 1.47% (estimated using treasury bonds with a 7-year life), (iii) strike prices of $7,480 and $9,340 for the common stock warrants, (iv) fair value of common stock ($8,020) and (v) expected life (7 years). The fair value of the 2021 Perceptive Warrants of approximately $1.1 million at the time of issuance, which was determined using the Black-Scholes option-pricing model, was recorded as additional paid-in capital and reduced the carrying value of the debt. The significant assumptions used in preparing the option pricing model for valuing the 2021 Perceptive Warrants issued include (i) volatility (103.5%), (ii) risk free interest rate of 1.15% (estimated using treasury bonds with a 7-year life), (iii) strike price of $5,740 for the common stock warrant, (iv) fair value of common stock ($5,740) and (v) expected life (7 years). The fair value of the warrants as well as the debt issue costs incurred in connection with the entry into the Perceptive Credit Agreement, including a facility fee of 1% of the total amount of loans available under the facility, are presented as a direct deduction from the carrying amount of the term loan on the consolidated balance sheet as detailed below (in thousands).


	June 30,		December 31,
	2024		2023
Long-term debt	$	—	$	1,650
Debt issuance costs		—		(23)
Warrant discount		—		(112)
Total debt	$	—	$	1,515
Less, current portion		—		1,515
Long-term debt, less current portion	$	—	$	—

The fair value of the warrants and the debt issue costs were amortized utilizing the effective interest method over the term of the loan. The Company recorded interest expense for the amortization of the fair value of the warrants and debt issue costs of zero and $372,000 for the three months ended June 30, 2024 and 2023, respectively. The Company recorded interest expense for the amortization of the fair value of the warrants and debt issue costs of zero and $679,000 for the six months ended June 30, 2024 and 2023, respectively.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 470
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//470/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1E
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1E

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

+ Details

Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 2,848	$ 2,557
Accounts receivable, net	4,550	3,392
Inventory, net	5,793	2,738
Prepaid expenses and other current assets	1,252	843
Total current assets	14,443	9,530
Property and equipment, net	27	75
Right of use asset	255	412
Other non-current assets	238	238
Total assets	14,963	10,255
Current liabilities:
Long-term debt, current portion		1,515
Notes payable, current portion		191
Accounts payable	16,543	9,574
Accrued expenses	9,396	9,131
Lease liability, current portion	289	366
Total current liabilities	26,228	20,777
Lease liabilities, long-term		100
Warrant liability	10,647	5,696
Total liabilities	36,875	26,573
Commitments and contingencies (Note 9)
Stockholders' deficit
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, 4,850 issued and no shares outstanding at June 30, 2024 and no shares issued and outstanding at December 31, 2023
Common stock, $0.0001 par value, 300,000,000 shares authorized, 6,904,498 and 2,963,657 issued and outstanding at June 30, 2024 and December 31, 2023, respectively	5	4
Additional paid-in capital	411,839	406,846
Accumulated deficit	(433,756)	(423,168)
Total stockholders' deficit	(21,912)	(16,318)
Total liabilities and stockholders' deficit	$ 14,963	$ 10,255

Stockholders' Deficit

6 Months Ended

Jun. 30, 2024

Stockholders' Deficit

Stockholders' Deficit

8. Stockholders’ Deficit

On January 7, 2022, the Company’s stockholders approved an amendment to the Company’s Amended and Restated Certificate of Incorporation to increase the number of shares of common stock authorized for issuance from 150,000,000 shares to 300,000,000 shares.

Reverse Stock Split

On April 10, 2023, the Company filed with the Secretary of State of the State of Delaware a certificate of amendment, or the Certificate of Amendment, to the Company’s Amended and Restated Certificate of Incorporation, which became effective on April 10, 2023. The Certificate of Amendment implemented a 1-for-50 reverse stock split of the Company’s common stock. On the effective date of April 10, 2023, the number of the Company’s issued and outstanding shares of common stock was decreased from 46,605,134 to 932,101, and the par value remained unchanged. No fractional shares were issued as a result of the reverse stock split. Stockholders who would otherwise have been entitled to receive a fractional share received a cash payment in lieu thereof. The reverse stock split affected all shares of the Company’s common stock outstanding immediately prior to the effective date of the reverse stock split, as well as the number of shares of common stock available for issuance under the Company’s equity incentive plans. In addition, the reverse stock split effected a reduction in the number of shares of common stock issuable upon the exercise of stock options, restricted stock units, or warrants outstanding.

Shelf Registration Statement

On October 2, 2020, the Company filed a universal shelf registration statement with the SEC for the issuance of common stock, preferred stock, warrants, rights, debt securities and units up to an aggregate amount of $200.0 million (the “2020 Shelf Registration Statement”). On October 14, 2020, the 2020 Shelf Registration Statement was declared effective by the SEC. In the future, the Company may periodically offer one or more of these securities in amounts, prices, and terms to be announced when and if the securities are offered. At the time any of the securities covered by the 2020 Shelf Registration Statement are offered for sale, a prospectus supplement will be prepared and filed with the SEC containing specific information about the terms of any such offering. The 2020 Shelf Registration Statement expired on October 13, 2023.

Public Offerings

In May 2023, the Company completed a best efforts public offering of an aggregate of 95,000 shares of common stock and 1,801,286 pre-funded warrants in lieu of shares of common stock and warrants to purchase a total of 3,792,572 shares of common stock at combined public offering price of $3.9551 per share. Proceeds from the public offering, net of underwriting discounts, commissions, and offering expenses were approximately $6.5 million. All of the pre-funded warrants had been exercised prior to December 31, 2023. H.C. Wainwright acted as the exclusive placement agent in connection with the Offering and, as compensation, received a cash fee of 7% of the aggregate proceeds raised in the Offering. The Company also issued to certain designees of H.C. Wainwright warrants to purchase up to 94,814 shares of commons stock with an exercise price of $4.9439 per share.

In December 2023, the Company entered into a Warrant Amendment and Additional Issuance Agreement relating to the amendment of warrants to purchase shares of common stock that were issued in transactions on March 14, 2022, April 25, 2022, and May 25, 2023. Collectively, the Warrants represent the right to purchase approximately 3.8 million shares of common stock. Under the terms of the Warrant Amendment and Additional Issuance Agreement, the holder agreed to revise provisions related to the use of a Black-Scholes model to value the Warrants in the event of a change of control transaction. The holder also agreed to revise provisions related to the cashless exercise of the Warrants. In exchange for the holder’s agreement to amend the Warrants, the Company agreed to issue an additional new warrant (the “New Warrant”) to purchase 1,005,560 shares of common stock. The New Warrant has an exercise price of $2.09 per share of common stock. The New Warrant is exercisable six months after issuance and will expire five years from the date that the New Warrant is initially exercisable. The exercise price of the New Warrant is subject to adjustment for stock splits, reverse splits, and similar capital transactions as described in the New Warrant.

February 2024 Warrant Exercise

As previously reported, the Company issued warrants on July 6, 2022 and May 25, 2023, each of which were amended on December 3, 2023 (collectively the “Warrants”) to a certain investor, collectively representing the right to purchase up to an aggregate of 3,892,572 shares of the common stock, par value $0.0001 per share, of the Company (“Common Stock”), at an exercise price of $3.69 per share. On February 22, 2024, the Company entered into a warrant exercise agreement (the “Exercise Agreement”) with this certain holder of its Warrants (the “Exercising Holder”) wherein the Exercising Holder agreed to exercise the Warrants for cash, at an exercise price reduced by the Company to $1.25 per share (the “Warrant Exercise”). The gross proceeds from the Warrant Exercise were approximately $4.8 million. In consideration for the Warrant Exercise, the Company issued new unregistered warrants to purchase shares of Common Stock (the “New Warrants”). The New Warrants are exercisable for an aggregate of up to 7,785,144 shares of Common Stock, at an exercise price of $1.00 per share and will be immediately exercisable upon issuance. 3,992,572 of the New Warrants will have a term of five years from the issuance date and 3,792,572 of the New Warrants will have a term of eighteen months from the issuance date. The exercise price of the New Warrants is subject to adjustment for stock splits, reverse splits, and similar capital transactions as described in the New Warrants. H.C. Wainwright & Co., LLC acted as placement agent and financial advisor in connection with the transaction and received a cash fee of 7.0% of the gross proceeds resulting from the Warrant Exercise, a management fee of 1.0% of the gross proceeds resulting from the Warrant Exercise and warrants (the “Placement Agent Warrants”) to purchase 194,629 of shares of Common Stock which is equal to 5.0% of the number of Warrants exercised at an exercise price of $1.5625.

The Company has accounted for the warrants as liabilities, while the pre-funded warrants are classified as a component of permanent equity within additional paid-in capital because they are freestanding financial instruments that are legally detachable and separately exercisable from the shares of common stock with which they were issued, are immediately exercisable, do not embody an obligation for the Company to repurchase its shares, and permit the holders to receive a fixed number of shares of common stock upon exercise. The Company also determined that the pre-funded warrants should be included in the determination of basic earnings per share in accordance with ASC 260, Earnings per Share.

ATM Sales Agreement

On April 27, 2022, the Company entered into a new at-the-market offering program (the “April 2022 ATM Agreement”) with H.C. Wainwright LLC and Co. (the “Sales Agent”) under which the Company is authorized to sell up to an aggregate of $12.8 million in gross proceeds through the sale of shares of common stock from time to time. The Company agreed to pay a commission of up to 3.0% of the gross proceeds of any common stock sold under the April 2022 ATM Agreement. Through September 30, 2022, the Company issued and sold a total of 173,750 shares of common stock under the April 2022 ATM Agreement, representing the entire capacity of the April 2022 ATM, resulting in net proceeds of approximately $12.2 million. On August 22, 2022, the Company increased the April 2022 ATM (“August 2022 ATM”). As increased, the Company was eligible to offer and sell, from time to time through the Sales Agent, shares of its common stock having an aggregate offering price of up to $75.0 million. On April 12, 2023, the Company filed a prospectus supplement to its registration statement on Form S-3 for the August 2022 ATM verifying that it was eligible to sell up to $4.5 million worth of shares through its ATM. During the six months ended June 30, 2023, the Company issued and sold 178,041 shares for net proceeds of approximately $1.7 million. The Company’s ATM expired in October 2023.

Stock-Based Compensation Expense

Stock-based compensation expense was allocated as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Cost of product revenues	$	17	$	28	$	36	$	57
Research and development		63		81		137		168
Selling and marketing		8		32		20		62
General and administrative		196		341		425		692
Total	$	284	$	482	$	618	$	979

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 505
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481004/946-505-50-6

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 815
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480237/815-40-50-6

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480008/505-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 505
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//505/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 16
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-16

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

+ Details

Merger with Insud Pharma, S.L. - Revolving Promissory Note and Intellectual Property Security Agreement (Details) - Bridge loan - Insud Pharma S.L - USD ($) $ in Millions	Jul. 01, 2024	Jun. 25, 2024
Merger with Insud Pharma, S.L.
Maximum borrowing capacity		$ 8.0
Increase in interest rate on occurrence of default, percentage		4.00%
Subsequent event
Merger with Insud Pharma, S.L.
Initial loan advance amount	$ 6.5

Accrued Liabilities

6 Months Ended

Jun. 30, 2024

Accrued Liabilities

Accrued Liabilities

5. Accrued Liabilities

Accrued liabilities consist of the following (in thousands):


	June 30,		December 31,
	2024		2023
Gross to net accruals	$	7,507	$	6,492
Accrued compensation		954		832
Accrued professional fees and other		935		1,807
Total accrued liabilities	$	9,396	$	9,131

Merger with Insud Pharma, S.L.

6 Months Ended

Jun. 30, 2024

Merger with Insud Pharma, S.L.

Merger with Insud Pharma, S.L.

10. Merger with Insud Pharma, S.L.

On June 25, 2024, the Company entered into the Merger Agreement with Insud, and Merger Sub. Pursuant to the terms and subject to the conditions of the Merger Agreement, Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger as an indirect wholly owned subsidiary of Insud.

The Merger Agreement was unanimously approved by the Board on June 25, 2024. As part of the purchase price for Agile, Insud has agreed to make available a Bridge Loan, which is secured by a security interest in the Company’s intellectual property (see further discussion below).

As preconditions to entering into the Merger Agreement, the Company has entered into (i) a Conditional Amendment No. 3 (“Amendment No. 3”) to that certain Manufacturing and Commercialization Agreement, dated April 30, 2020, by and between Agile and Corium Innovations, Inc. (“Corium”), as previously amended by Amendment No. 1 entered into as of July 25, 2022 and Amendment No. 2 entered into as of May 13, 2024 (as amended to date, the “Manufacturing and Commercialization Agreement”), on commercial terms reasonably acceptable to Insud, and including a conditional waiver to such party’s right to seek damages or other compensation for the Company’s failure to meet certain obligations under the Manufacturing and Commercialization Agreement, and (ii) a cash-out acknowledgment and cancellation agreement dated as of June 25, 2024 (the “Warrant Cash-Out Agreement”) with holders of not less than 95% of the outstanding warrants to purchase Company Common Stock (“Company Warrants”).

At the effective time of the Merger (the “Effective Time”), each share of common stock, par value $0.0001 per share, of the Company (the “Company Common Stock”) will be cancelled and converted automatically into and will thereafter represent only the right to receive $1.52 per share in cash, without interest, with respect to such shares of Company Common Stock (the “Merger Consideration”), subject to applicable withholding taxes.

In addition, immediately prior to the Effective Time, each unexpired and unexercised option to purchase Company Common Stock (each, a “Company Stock Option”), will, to the extent unvested, become fully vested and exercisable immediately prior to, and contingent upon, the Effective Time. At the Effective Time, each Company Stock Option that is then outstanding and unexercised shall be cancelled with no consideration payable in respect thereof.

At the Effective Time, each outstanding award of Company restricted stock units denominated in shares of Company Common Stock (each, a “Company RSU”) that is outstanding immediately prior to the Effective Time will be cancelled and converted automatically into the right to receive a payment in cash, without interest and subject to applicable withholding and other applicable taxes, equal to the product of (a) the Merger Consideration multiplied by (b) the total number of shares of Company Common Stock subject to the Company RSU immediately prior to the Effective Time.

In addition, prior to the Closing, as defined below, the Company shall use best efforts to cause each holder of the remaining Company Warrants not party thereto to execute an agreement substantially identical to the Warrant Cash-Out Agreement described below, which will provide for the exercise and cancellation of such Company Warrants in exchange for a cash payment by the Company to such holder following the Effective Time.

The Merger Agreement contains customary representations, warranties and covenants of the Company, Insud and Merger Sub, including, among others, the agreement by the Company to conduct its business in the ordinary

course consistent in all material respects with past practice during the period between execution of the Merger Agreement and completion of the Merger (the “Closing”) and covenants prohibiting the Company from engaging in certain activities during such period without the consent of Insud.

The Closing is conditioned upon, among other things, (a) the approval of the Merger Agreement by the affirmative vote of holders of at least a majority of the outstanding shares of Company Common Stock entitled to vote on the adoption of the Merger Agreement at a meeting of holders of the Company Common Stock held for such purpose, which is scheduled for August 22, 2024, (b) the absence of any judgements or laws enjoining, making illegal or otherwise prohibiting the Merger, (c) the accuracy of the other party’s representations and warranties, subject to certain customary materiality standards set forth in the Merger Agreement, (d) compliance in all material respects with the other party’s obligations under the Merger Agreement, (e) no Company Material Adverse Effect (as defined in the Merger Agreement) having occurred since the date of the Merger Agreement and (f) the Company’s performance with all of its obligations under Amendment No. 3 and Amendment No. 3 being in force and not capable of termination by Corium.

The Merger Agreement contains customary non-solicitation covenants that prohibit the Company from soliciting competing proposals or entering into discussions concerning, or providing confidential information in connection with, certain proposals for an alternative transaction. These non-solicitation covenants allow the Company, under certain circumstances and in compliance with certain obligations set forth in the Merger Agreement, to provide nonpublic information to, and engage in discussions and negotiations with, third parties in response to an unsolicited acquisition proposal. The Board also may change its recommendation to the holders of Company Common Stock to adopt the Merger Agreement in response to a “Superior Proposal” or an “Intervening Event” (each as defined in the Merger Agreement) if the Board determines in good faith, after consultation with outside legal counsel, that the failure to take such action would be inconsistent with the fiduciary duties of the Board under applicable law.

The Merger Agreement provides for certain termination rights for both the Company and Insud, including the right of either party to terminate the Merger Agreement if the Merger has not been consummated on or prior to September 30, 2024 (subject to extension as set forth in the Merger Agreement). Upon termination of the Merger Agreement under certain specified circumstances, including (a) the termination of the Merger Agreement by the Company in order to enter into an alternative transaction constituting a Superior Proposal or (b) the termination of the Merger Agreement by Insud due to a change in recommendation of the Board to the holders of Company Common Stock, the Company would be required to pay Insud a termination fee of $1.26 million and any amounts outstanding under the Bridge Loan.

Revolving Promissory Note and Intellectual Property Security Agreement

Concurrently with the execution of the Merger Agreement, Insud made available to the Company a maximum aggregate principal amount of up to $8.0 million (the “Bridge Loan”) pursuant to a Revolving Promissory Note (the “Note”), issued by the Company. The principal amount of the Bridge Loan accrues interest at a rate per annum equal to the rate last quoted by The Wall Street Journal as the “Prime Rate” in the United States or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Federal Reserve Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the “bank prime loan” rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as determined by the lender) or any similar release by the Federal Reserve Board, which is subject to automatic increase by 4% upon the occurrence of certain events of default (the “Default Rate”). The principal amount due under the Note and all accrued and unpaid interest is payable by Agile on the earlier of (i) November 22, 2024, and (ii) the date on which the Commitment Amount is reduced to zero or otherwise terminated (the “Stated Expiry Date”). The initial loan advance of $6.5 million was made on July 1, 2024. Subsequent requests for advances under the Note shall be made by the Company (in such amounts as necessary) after July 15, 2024. The Note is secured pursuant to an Intellectual Property Security Agreement (the “Security Agreement”) under which the Company granted a security interest in its intellectual property assets and rights. Furthermore, in the event the Merger is not consummated in certain instances and the Merger Agreement is terminated, Agile shall be obligated to repay to Insud any amounts outstanding (including interest accrued) under the Bride Loan.