2017 Q2 Form 10-Q Financial Statement

#000119312517162489 Filed on May 08, 2017

View on sec.gov

Income Statement

Concept 2017 Q2 2017 Q1 2016 Q1
Revenue $701.0K $590.0K $324.0K
YoY Change 130.59% 82.1% -1.22%
Cost Of Revenue
YoY Change
Gross Profit
YoY Change
Gross Profit Margin
Selling, General & Admin $2.620M $2.430M $2.350M
YoY Change -1.5% 3.4% 15.2%
% of Gross Profit
Research & Development $4.210M $3.324M $3.074M
YoY Change 2.68% 8.13% -7.94%
% of Gross Profit
Depreciation & Amortization $210.0K $210.0K $220.0K
YoY Change -16.0% -4.55% 4.76%
% of Gross Profit
Operating Expenses $6.840M $5.750M $5.420M
YoY Change 1.18% 6.09% 0.74%
Operating Profit -$6.136M -$5.160M -$5.096M
YoY Change -4.96% 1.26% 0.87%
Interest Expense $20.00K $20.00K $20.00K
YoY Change -33.33% 0.0% 100.0%
% of Operating Profit
Other Income/Expense, Net $20.00K $21.00K
YoY Change -4.76% 110.0%
Pretax Income -$6.120M -$5.140M -$5.075M
YoY Change -4.82% 1.28% 0.65%
Income Tax $0.00 $0.00 -$34.00K
% Of Pretax Income
Net Earnings -$6.116M -$5.140M -$5.041M
YoY Change -4.24% 1.96% 0.86%
Net Earnings / Revenue -872.47% -871.19% -1555.86%
Basic Earnings Per Share -$0.15
Diluted Earnings Per Share -$1.581M -$1.494M -$0.15
COMMON SHARES
Basic Shares Outstanding 39.27M shares 34.18M shares 33.54M shares
Diluted Shares Outstanding 33.54M shares

Balance Sheet

Concept 2017 Q2 2017 Q1 2016 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $16.90M $15.40M $33.30M
YoY Change -41.72% -53.75% 5.05%
Cash & Equivalents $16.90M $12.87M $24.87M
Short-Term Investments $0.00 $2.500M $8.400M
Other Short-Term Assets $600.0K $800.0K $500.0K
YoY Change 20.0% 60.0% -50.0%
Inventory
Prepaid Expenses
Receivables $300.0K $300.0K $500.0K
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $17.74M $16.47M $34.28M
YoY Change -40.79% -51.95% 3.63%
LONG-TERM ASSETS
Property, Plant & Equipment $313.0K $241.0K $311.0K
YoY Change 7.93% -22.51% 11.07%
Goodwill
YoY Change
Intangibles
YoY Change
Long-Term Investments
YoY Change
Other Assets $300.0K $300.0K $300.0K
YoY Change 0.0% 0.0% 0.0%
Total Long-Term Assets $937.0K $1.035M $1.887M
YoY Change -43.42% -45.15% -28.11%
TOTAL ASSETS
Total Short-Term Assets $17.74M $16.47M $34.28M
Total Long-Term Assets $937.0K $1.035M $1.887M
Total Assets $18.68M $17.51M $36.17M
YoY Change -40.93% -51.6% 1.3%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $1.016M $741.0K $571.0K
YoY Change -25.46% 29.77% -29.68%
Accrued Expenses $4.224M $3.943M $3.378M
YoY Change 17.89% 16.73% 146.39%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $5.290M $4.940M $3.968M
YoY Change 3.87% 24.5% 78.9%
LONG-TERM LIABILITIES
Long-Term Debt $0.00 $0.00 $0.00
YoY Change
Other Long-Term Liabilities $51.00K $100.0K $5.600M
YoY Change -99.09% -98.21% 0.0%
Total Long-Term Liabilities $51.00K $100.0K $5.600M
YoY Change -99.09% -98.21% 0.0%
TOTAL LIABILITIES
Total Short-Term Liabilities $5.290M $4.940M $3.968M
Total Long-Term Liabilities $51.00K $100.0K $5.600M
Total Liabilities $5.341M $4.995M $9.612M
YoY Change -50.26% -48.03% 22.37%
SHAREHOLDERS EQUITY
Retained Earnings -$310.8M -$304.6M -$285.8M
YoY Change 6.37% 6.56% 7.65%
Common Stock $323.3M $316.3M $311.5M
YoY Change 3.55% 1.53% 1074027.59%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $13.34M $12.51M $26.55M
YoY Change
Total Liabilities & Shareholders Equity $18.68M $17.51M $36.17M
YoY Change -40.93% -51.6% 1.3%

Cashflow Statement

Concept 2017 Q2 2017 Q1 2016 Q1
OPERATING ACTIVITIES
Net Income -$6.116M -$5.140M -$5.041M
YoY Change -4.24% 1.96% 0.86%
Depreciation, Depletion And Amortization $210.0K $210.0K $220.0K
YoY Change -16.0% -4.55% 4.76%
Cash From Operating Activities -$4.450M -$4.540M -$4.300M
YoY Change 2.3% 5.58% 8.59%
INVESTING ACTIVITIES
Capital Expenditures -$130.0K -$10.00K -$30.00K
YoY Change 225.0% -66.67% -25.0%
Acquisitions
YoY Change
Other Investing Activities $2.500M $3.350M $1.470M
YoY Change -147.35% 127.89% -153.65%
Cash From Investing Activities $2.380M $3.330M $1.430M
YoY Change -144.74% 132.87% -151.44%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $17.80M
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities 6.100M 2.390M 16.53M
YoY Change 4983.33% -85.54%
NET CHANGE
Cash From Operating Activities -4.450M -4.540M -4.300M
Cash From Investing Activities 2.380M 3.330M 1.430M
Cash From Financing Activities 6.100M 2.390M 16.53M
Net Change In Cash 4.030M 1.180M 13.66M
YoY Change -142.2% -91.36% -302.67%
FREE CASH FLOW
Cash From Operating Activities -$4.450M -$4.540M -$4.300M
Capital Expenditures -$130.0K -$10.00K -$30.00K
Free Cash Flow -$4.320M -$4.530M -$4.270M
YoY Change 0.23% 6.09% 8.93%

Facts In Submission

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<div> <table style="FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr style="break-inside: avoid"> <td valign="top" width="4%" align="left"><b>1.</b></td> <td valign="top" align="left"><b>Operations and Basis of Presentation</b></td> </tr> </table> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> The accompanying condensed consolidated financial statements of pSivida Corp. and subsidiaries (the &#x201C;Company&#x201D;) as of March&#xA0;31, 2017 and for the three and nine months ended March&#xA0;31, 2017 and 2016 are unaudited. Certain information in the footnote disclosures of these financial statements has been condensed or omitted in accordance with the rules and regulations of the Securities and Exchange Commission (the &#x201C;SEC&#x201D;). These financial statements should be read in conjunction with the Company&#x2019;s audited consolidated financial statements and footnotes included in its Annual Report on Form&#xA0;<font style="WHITE-SPACE: nowrap">10-K</font>&#xA0;for the fiscal year ended June&#xA0;30, 2016 (&#x201C;fiscal 2016&#x201D;). In the opinion of management, these statements have been prepared on the same basis as the audited consolidated financial statements as of and for the year ended June&#xA0;30, 2016, and include all adjustments, consisting only of normal recurring adjustments, that are necessary for the fair presentation of the Company&#x2019;s financial position, results of operations, comprehensive loss and cash flows for the periods indicated. The preparation of financial statements in accordance with U.S. generally accepted accounting principles (&#x201C;GAAP&#x201D;) requires management to make assumptions and estimates that affect, among other things, (i)&#xA0;reported amounts of assets and liabilities; (ii)&#xA0;disclosure of contingent assets and liabilities at the date of the consolidated financial statements; and (iii)&#xA0;reported amounts of revenues and expenses during the reporting period. The results of operations for the three and nine months ended March&#xA0;31, 2017 are not necessarily indicative of the results that may be expected for the entire fiscal year or any future period.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> The Company currently develops proprietary sustained-release drug products for the treatment of chronic eye diseases. The Company&#x2019;s approved products and product candidates deliver drugs at a controlled and steady rate for months or years. The Company has developed three of only four sustained-release products approved by the U.S. Food and Drug Administration (&#x201C;FDA&#x201D;) for treatment of&#xA0;<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">back-of-the-eye</font></font></font>&#xA0;diseases. Durasert&#x2122; three-year&#xA0;<font style="WHITE-SPACE: nowrap">non-erodible</font>&#xA0;fluocinolone acetonide (&#x201C;FA&#x201D;) insert for posterior segment uveitis (&#x201C;Durasert three-year uveitis&#x201D;) (formerly known as Medidur&#x2122;), the Company&#x2019;s lead product candidate, is in pivotal Phase 3 clinical trials, and ILUVIEN&#xAE; for diabetic macular edema (&#x201C;ILUVIEN&#x201D;), the Company&#x2019;s most recent&#xA0;<font style="WHITE-SPACE: nowrap">out-licensed</font>&#xA0;product, is sold directly in the U.S. and three European Union (&#x201C;EU&#x201D;) countries. Retisert&#xAE;, which was approved by the FDA for the treatment of posterior segment uveitis, is sold by Bausch&#xA0;&amp; Lomb Incorporated (&#x201C;Bausch&#xA0;&amp; Lomb&#x201D;). The Company&#x2019;s development programs are focused primarily on developing sustained release products that utilize its Durasert technology platform to deliver approved drugs to treat chronic diseases. The Company&#x2019;s strategy includes developing products independently while continuing to leverage its technology platforms through collaborations and license agreements.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> Durasert three-year uveitis, the Company&#x2019;s most advanced development product candidate, is designed to treat chronic&#xA0;<font style="WHITE-SPACE: nowrap">non-infectious</font>&#xA0;uveitis affecting the posterior segment of the eye (&#x201C;posterior segment uveitis&#x201D;) for three years from a single administration. Injected into the eye in an office visit, this product candidate is a tiny micro-insert that delivers a micro-dose of a corticosteroid to the back of the eye on a sustained basis. The Company is developing Durasert three-year uveitis independently.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> The first of two Phase 3 clinical trials investigating Durasert three-year uveitis met its primary efficacy endpoint of prevention of recurrence of disease through six months with high statistical significance (p &lt; 0.001, intent to treat analysis) and with safety data consistent with the known effects of ocular corticosteroid use. The same high statistical significance for efficacy and encouraging safety results were maintained through 12 months of&#xA0;<font style="WHITE-SPACE: nowrap">follow-up.</font>&#xA0;Due to the high level of statistical significance achieved, the Company plans to file its EU marketing approval application (&#x201C;MAA&#x201D;) based on data from the first Phase 3 clinical trial, rather than two clinical trials. The Company expects to file the MAA in June 2017. The second Phase 3 clinical trial completed its target enrollment of 150 patients at the end of September 2016. This clinical trial has the same clinical trial design and the same endpoint as the first Phase 3 clinical trial, and a&#xA0;<font style="WHITE-SPACE: nowrap">read-out</font>&#xA0;of its&#xA0;<font style="WHITE-SPACE: nowrap">top-line</font>&#xA0;results is expected in June 2017. Assuming favorable results, the Company plans to file a new drug application (&#x201C;NDA&#x201D;) with the FDA in the fourth quarter of calendar 2017. The Company&#x2019;s new Durasert three-year uveitis inserter with a smaller diameter needle, and original inserter with a slightly larger diameter needle and simpler mechanism, were evaluated in a utilization study that will be filed in both the MAA and NDA. Both inserters met their primary endpoint of ease of intravitreal administration.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> ILUVIEN is an injectable, sustained-release micro-insert that provides three years of treatment of diabetic macular edema from a single injection. ILUVIEN is based on the same technology as the Durasert three-year uveitis insert, and delivers the same corticosteroid, FA. ILUVIEN was developed in collaboration with, and is licensed to and sold by, Alimera Sciences, Inc. (&#x201C;Alimera&#x201D;). The Company is entitled to a share of the net profits (as defined) from Alimera&#x2019;s sales of ILUVIEN on a&#xA0;<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">quarter-by-quarter,</font></font>&#xA0;<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">country-by-country</font></font>&#xA0;basis. ILUVIEN has been sold directly in the United Kingdom (&#x201C;U.K.&#x201D;) and Germany since June 2013 and in the U.S. and Portugal since 2015, and also has marketing approvals in 14 other European countries. Alimera has sublicensed distribution, regulatory and reimbursement matters for ILUVIEN in Australia and New Zealand, Canada, Italy, Spain and numerous countries in the Middle East.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> The Company&#x2019;s&#xA0;<font style="WHITE-SPACE: nowrap">FDA-approved</font>&#xA0;Retisert is an implant that provides sustained treatment of posterior segment uveitis for 30 months. Administered in a surgical procedure, Retisert delivers the same corticosteroid as the Durasert three-year&#xA0;<font style="WHITE-SPACE: nowrap">non-erodible</font>&#xA0;insert, but in a larger dose. Retisert was&#xA0;<font style="WHITE-SPACE: nowrap">co-developed</font>&#xA0;with, and is licensed to, Bausch&#xA0;&amp; Lomb, and the Company receives royalties from its sales.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> The Company&#x2019;s development programs are focused primarily on developing sustained release drug products using its proven Durasert technology platform to deliver small molecule drugs to treat uveitis, wet&#xA0;<font style="WHITE-SPACE: nowrap">age-related</font>&#xA0;macular degeneration (&#x201C;AMD&#x201D;), osteoarthritis and other diseases. A sustained-release surgical implant delivering a corticosteroid to treat pain associated with severe knee osteoarthritis that was jointly developed by the Company and Hospital for Special Surgery is currently being evaluated in an investigator-sponsored safety and tolerability study. The Company has minimized further development work of its Tethadur&#x2122; technology platform designed to deliver large molecules, such as biologics, both locally and systemically, in order to focus its resources on leveraging its proven Durasert technology for delivery of small molecules.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> The Company has financed its operations primarily from sales of equity securities and the receipt of license fees, milestone payments, research and development funding and royalty income from its collaboration partners. The Company has a history of operating losses and, to date, has not had significant recurring cash inflows from revenue. The Company believes that its cash, cash equivalents and marketable securities of $15.4&#xA0;million at March&#xA0;31, 2017, together with subsequent cash proceeds received from additional utilization of its&#xA0;<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">at-the-market</font></font>&#xA0;(&#x201C;ATM&#x201D;) equity program (refer to Note 8) and from existing collaboration agreements, will enable the Company to maintain its current and planned operations (including its two Durasert three-year uveitis Phase 3 clinical trials) through approximately the third quarter of fiscal 2018. This estimate excludes any potential receipts under the Alimera agreement. In order to extend the Company&#x2019;s ability to fund operations beyond the third quarter of fiscal 2018, management&#x2019;s plans include reducing or deferring operating expenses and/or accessing additional equity financing from the sale of its common stock through its ATM program or other financing transactions. The timing and extent of the Company&#x2019;s implementation of these plans is expected to depend on the amount and timing of cash receipts from Alimera&#x2019;s commercialization of ILUVIEN, proceeds from any future collaboration or other agreements and/or proceeds from any financing transactions. There is no assurance that the Company will receive significant, if any, revenues from Alimera&#x2019;s commercialization of ILUVIEN or financing from any other sources.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> New accounting pronouncements are issued periodically by the Financial Accounting Standards Board (&#x201C;FASB&#x201D;) and are adopted by the Company as of the specified effective dates. Unless otherwise disclosed below, the Company believes that recently issued and adopted pronouncements will not have a material impact on the Company&#x2019;s financial position, results of operations and cash flows or do not apply to the Company&#x2019;s operations.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> In May 2014, the FASB issued Accounting Standards Update&#xA0;<font style="WHITE-SPACE: nowrap">No.&#xA0;2014-09,</font>&#xA0;<i>Revenue from Contracts with Customers&#xA0;</i>(Topic 606) (&#x201C;ASU&#xA0;<font style="WHITE-SPACE: nowrap">2014-09&#x201D;),</font>&#xA0;which requires an entity to recognize revenue in an amount that reflects the consideration to which the entity expects to be entitled in exchange for the transfer of promised goods or services to customers. The standard will replace most existing revenue recognition guidance in U.S. GAAP. In August 2015, the FASB issued ASU&#xA0;<font style="WHITE-SPACE: nowrap">2015-14,</font>&#xA0;which officially deferred the effective date of ASU&#xA0;<font style="WHITE-SPACE: nowrap">2014-09</font>&#xA0;by one year, while also permitting early adoption. As a result, ASU&#xA0;<font style="WHITE-SPACE: nowrap">2014-09</font>&#xA0;will become effective on July&#xA0;1, 2018, with early adoption permitted on July&#xA0;1, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the impact the adoption of this standard will have on its consolidated financial statements.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> In August 2014, the FASB issued ASU&#xA0;<font style="WHITE-SPACE: nowrap">2014-15,</font>&#xA0;<i>Presentation of Financial Statements &#x2013; Going Concern</i>. ASU&#xA0;<font style="WHITE-SPACE: nowrap">2014-15</font>&#xA0;provides guidance around management&#x2019;s responsibility to evaluate whether there is substantial doubt about an entity&#x2019;s ability to continue as a going concern and to provide related footnote disclosures. For each reporting period, management will be required to evaluate whether there are conditions or events that raise substantial doubt about a company&#x2019;s ability to continue as a going concern within one year from the date the financial statements are issued. The new standard is effective for annual periods ending after December&#xA0;15, 2016, and interim periods thereafter. As a result, ASU&#xA0;<font style="WHITE-SPACE: nowrap">2014-15</font>&#xA0;will become effective for the annual period ending June&#xA0;30, 2017, and interim periods thereafter. The Company is evaluating the impact the adoption of this standard will have on its consolidated financial statements.</p> <p style="MARGIN-BOTTOM: 0px; FONT-SIZE: 1px; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12px; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> &#xA0;</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> In February 2016, the FASB issued ASU&#xA0;<font style="WHITE-SPACE: nowrap">No.&#xA0;2016-02,</font>&#xA0;<i>Leases</i>. The new standard establishes a&#xA0;<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">right-of-use</font></font>&#xA0;(&#x201C;ROU&#x201D;) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December&#xA0;15, 2018, including interim periods within those fiscal years. As a result, ASU&#xA0;<font style="WHITE-SPACE: nowrap">2016-02</font>&#xA0;will become effective on July&#xA0;1, 2019. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is evaluating the impact the adoption of this standard will have on its consolidated financial statements.</p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: &quot;Times New Roman&quot;; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: normal; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 4%; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal"> In March 2016, the FASB issued ASU&#xA0;<font style="WHITE-SPACE: nowrap">2016-09,</font>&#xA0;<i>Compensation &#x2013; Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting</i>. ASU&#xA0;<font style="WHITE-SPACE: nowrap">2016-09</font>&#xA0;intends to simplify various aspects of how share-based payments are accounted for and presented in the financial statements. The main provisions include: all tax effects related to stock awards will now be recorded through the statement of operations instead of through equity, all&#xA0;<font style="WHITE-SPACE: nowrap">tax-related</font>&#xA0;cash flows resulting from stock awards will be reported as operating activities on the cash flow statement, and entities can make an accounting policy election to either estimate forfeitures or account for forfeitures as they occur. The amendments in ASU&#xA0;<font style="WHITE-SPACE: nowrap">2016-09</font>&#xA0;are effective for fiscal years beginning after December&#xA0;15, 2016, including interim periods within those fiscal years, and may be applied prospectively with earlier adoption permitted. As a result, ASU&#xA0;<font style="WHITE-SPACE: nowrap">2016-09</font>&#xA0;will become effective on July&#xA0;1, 2017. The Company is evaluating the impact the amendment of this guidance will have on its consolidated financial statements.</p> <br class="Apple-interchange-newline" /> </div>
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AmortizationOfIntangibleAssets
756000
CY2016 us-gaap Finite Lived Intangible Assets Foreign Currency Translation Gain Loss
FiniteLivedIntangibleAssetsForeignCurrencyTranslationGainLoss
-3514000
CY2016 psdv Finite Lived Intangible Assets Foreign Currency Translation Of Accumulated Amortization
FiniteLivedIntangibleAssetsForeignCurrencyTranslationOfAccumulatedAmortization
-3447000
CY2017Q1 us-gaap Antidilutive Securities Excluded From Computation Of Earnings Per Share Amount
AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount
8121296 shares
CY2017Q1 us-gaap Earnings Per Share Basic And Diluted
EarningsPerShareBasicAndDiluted
-0.15
CY2017Q1 us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
IncomeLossFromContinuingOperationsBeforeIncomeTaxesExtraordinaryItemsNoncontrollingInterest
-5140000
CY2017Q1 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
0
CY2017Q1 us-gaap License And Services Revenue
LicenseAndServicesRevenue
372000
CY2017Q1 us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
1000
CY2017Q1 us-gaap Operating Income Loss
OperatingIncomeLoss
-5160000
CY2017Q1 us-gaap Marketable Securities Unrealized Gain Loss
MarketableSecuritiesUnrealizedGainLoss
1000
CY2016Q1 us-gaap General And Administrative Expense
GeneralAndAdministrativeExpense
2346000
CY2017Q1 us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
0
CY2017Q1 us-gaap Research And Development Expense
ResearchAndDevelopmentExpense
3324000
CY2017Q1 us-gaap Royalty Revenue
RoyaltyRevenue
218000
CY2017Q1 us-gaap Weighted Average Number Of Share Outstanding Basic And Diluted
WeightedAverageNumberOfShareOutstandingBasicAndDiluted
34366000 shares
CY2016Q1 us-gaap Antidilutive Securities Excluded From Computation Of Earnings Per Share Amount
AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount
5695026 shares
CY2016Q1 us-gaap Earnings Per Share Basic And Diluted
EarningsPerShareBasicAndDiluted
-0.15
CY2016Q1 us-gaap Allocated Share Based Compensation Expense
AllocatedShareBasedCompensationExpense
661000
CY2017Q1 us-gaap Allocated Share Based Compensation Expense
AllocatedShareBasedCompensationExpense
644000
CY2017Q1 us-gaap General And Administrative Expense
GeneralAndAdministrativeExpense
2426000
CY2017Q1 us-gaap Comprehensive Income Net Of Tax
ComprehensiveIncomeNetOfTax
-5139000
CY2017Q1 us-gaap Amortization Of Intangible Assets
AmortizationOfIntangibleAssets
180000
CY2017Q1 us-gaap Revenues
Revenues
590000
CY2017Q1 us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
20000
CY2017Q1 us-gaap Operating Expenses
OperatingExpenses
5750000
CY2017Q1 us-gaap Net Income Loss
NetIncomeLoss
-5140000
CY2016Q1 us-gaap Comprehensive Income Net Of Tax
ComprehensiveIncomeNetOfTax
-5053000
CY2016Q1 us-gaap Amortization Of Intangible Assets
AmortizationOfIntangibleAssets
187000
CY2016Q1 us-gaap Revenues
Revenues
324000
CY2016Q1 us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
21000
CY2016Q1 us-gaap Operating Expenses
OperatingExpenses
5420000
CY2016Q1 us-gaap Net Income Loss
NetIncomeLoss
-5041000
CY2016Q1 us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
IncomeLossFromContinuingOperationsBeforeIncomeTaxesExtraordinaryItemsNoncontrollingInterest
-5075000
CY2016Q1 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
-21000
CY2016Q1 us-gaap License And Services Revenue
LicenseAndServicesRevenue
50000
CY2016Q1 us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
-12000
CY2016Q1 us-gaap Operating Income Loss
OperatingIncomeLoss
-5096000
CY2016Q1 us-gaap Marketable Securities Unrealized Gain Loss
MarketableSecuritiesUnrealizedGainLoss
9000
CY2016Q1 us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
-34000
CY2016Q1 us-gaap Research And Development Expense
ResearchAndDevelopmentExpense
3074000
CY2016Q1 us-gaap Royalty Revenue
RoyaltyRevenue
274000
CY2016Q1 us-gaap Weighted Average Number Of Share Outstanding Basic And Diluted
WeightedAverageNumberOfShareOutstandingBasicAndDiluted
33538000 shares

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