0001558370-23-004572 | 10-K | XBRL Viewer

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Organization and Business - Liquidity and Going Concern (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Organization and Business
Accumulated deficit	$ (266,948)	$ (219,494)

Organization and Business	12 Months Ended
Dec. 31, 2022
Organization and Business
Organization and Business	1. Organization and Business Jaguar Health, Inc. (“Jaguar” or the “Company”) was founded in San Francisco, California as a Delaware corporation on June 6, 2013 (inception). The Company was a majority-owned subsidiary of Napo until the close of the Company's initial public offering on May 18, 2015. The Company was formed to develop and commercialize first-in-class prescription and non-prescription products for companion animals. On July 31, 2017, Jaguar completed a merger with Napo pursuant to the Agreement and Plan of Merger dated March 31, 2017, by and among Jaguar, Napo, Napo Acquisition Corporation (“Merger Sub”), and Napo's representative (the “Merger Agreement”). In accordance with the terms of the Merger Agreement, upon the completion of the merger, Merger Sub merged with and into Napo, with Napo surviving as the wholly owned subsidiary (the “Merger” or “Napo Merger”). Immediately following the Merger, Jaguar changed its name from “Jaguar Animal Health, Inc.” to “Jaguar Health, Inc.” Napo now operates as a wholly owned subsidiary of Jaguar focused on human health including the ongoing development of crofelemer and commercialization of Mytesi. On March 15, 2021, Jaguar established Napo EU S.p.A (which changed its name in December 2021 to “Napo Therapeutics”) in Milan, Italy as a subsidiary of Napo. Napo Therapeutics’ core mission is to provide access to crofelemer in Europe to address significant rare/orphan disease indications, including, initially, two key orphan target indications: Short bowel syndrome (“SBS”) with intestinal failure and congenital diarrheal disorders (“CDD”). The Company manages its operations through two segments – human health and animal health and is headquartered in San Francisco, California. Nasdaq Communication and Compliance Minimum Stockholders’ Equity Requirement On February 18, 2022 the Company received a letter from the Staff of Nasdaq indicating that the bid price of the Company’s common stock for the last 30 consecutive business days had again closed below the minimum $1.00 per share required for the continued listing under Nasdaq Listing Rule 5550(a)(2). On January 23, 2023, the Company effected a one-for-seventy-five reverse split of the Company’ issued and outstanding shares of common stock, par value $0.0001 per share. As a result of the Reverse Split every seventy-five shares of common stock issued and outstanding were automatically combined into one share of issued and outstanding common stock, without any change in the par value per share. All information related to Common Stock, stock options, restricted stock units, warrants and earnings per share have been retroactively adjusted to give effect to the Reverse Stock Split for all periods presented. On February 7, 2023, the Company received a letter from the Nasdaq Office of General Counsel notifying that the minimum bid price deficiency had been cured and that the Nasdaq had determined to continue the listing of the Company’s common stock on the Nasdaq stock market. Liquidity and Going Concern The Company, since its inception, has incurred recurring operating losses and negative cash flows from operations and has an accumulated deficit of $266.9 million as of December 31, 2022. The Company expects to incur substantial losses and negative cash flows in future periods. Further, the Company’s future operations, which include the satisfaction of current obligations, are dependent on the success of the Company’s ongoing development and commercialization efforts, as well as securing of additional financing and generating positive cash flows from operations. There is no assurance that the Company will have adequate cash balances to maintain its operations. Although the Company plans to finance its operations and cash flow needs through equity and/or debt financing, collaboration arrangements with other entities, license royalty agreements, joint ventures, as well as revenue from future product sales, the Company does not believe its current cash balances are sufficient to funds its operating plan through one year from the issuance of these consolidated financial statements. The Company has an immediate need to raise cash. There can be no assurance that additional funding will be available to the Company on acceptable terms, or on a timely basis, if at all, or that the Company will generate sufficient cash from operations to adequately fund operating needs. If the Company is unable to obtain an adequate level of financing needed for the long-term development and commercialization of our products, the Company will need to curtail planned activities and reduce costs. Doing so will likely have an adverse effect on our ability to execute our business plan; accordingly, there is substantial doubt about the ability of the Company to continue in existence as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Organization and Business

12 Months Ended

Dec. 31, 2022

Organization and Business

Organization and Business

1. Organization and Business

Jaguar Health, Inc. (“Jaguar” or the “Company”) was founded in San Francisco, California as a Delaware corporation on June 6, 2013 (inception). The Company was a majority-owned subsidiary of Napo until the close of the Company's initial public offering on May 18, 2015. The Company was formed to develop and commercialize first-in-class prescription and non-prescription products for companion animals.

On July 31, 2017, Jaguar completed a merger with Napo pursuant to the Agreement and Plan of Merger dated March 31, 2017, by and among Jaguar, Napo, Napo Acquisition Corporation (“Merger Sub”), and Napo's representative (the “Merger Agreement”). In accordance with the terms of the Merger Agreement, upon the completion of the merger, Merger Sub merged with and into Napo, with Napo surviving as the wholly owned subsidiary (the “Merger” or “Napo Merger”). Immediately following the Merger, Jaguar changed its name from “Jaguar Animal Health, Inc.” to “Jaguar Health, Inc.” Napo now operates as a wholly owned subsidiary of Jaguar focused on human health including the ongoing development of crofelemer and commercialization of Mytesi.

On March 15, 2021, Jaguar established Napo EU S.p.A (which changed its name in December 2021 to “Napo Therapeutics”) in Milan, Italy as a subsidiary of Napo. Napo Therapeutics’ core mission is to provide access to crofelemer in Europe to address significant rare/orphan disease indications, including, initially, two key orphan target indications: Short bowel syndrome (“SBS”) with intestinal failure and congenital diarrheal disorders (“CDD”).

The Company manages its operations through two segments – human health and animal health and is headquartered in San Francisco, California.

Nasdaq Communication and Compliance

Minimum Stockholders’ Equity Requirement

On February 18, 2022 the Company received a letter from the Staff of Nasdaq indicating that the bid price of the Company’s common stock for the last 30 consecutive business days had again closed below the minimum $1.00 per share required for the continued listing under Nasdaq Listing Rule 5550(a)(2).

On January 23, 2023, the Company effected a one-for-seventy-five reverse split of the Company’ issued and outstanding shares of common stock, par value $0.0001 per share. As a result of the Reverse Split every seventy-five shares of common stock issued and outstanding were automatically combined into one share of issued and outstanding common stock, without any change in the par value per share. All information related to Common Stock, stock options, restricted stock units, warrants and earnings per share have been retroactively adjusted to give effect to the Reverse Stock Split for all periods presented.

On February 7, 2023, the Company received a letter from the Nasdaq Office of General Counsel notifying that the minimum bid price deficiency had been cured and that the Nasdaq had determined to continue the listing of the Company’s common stock on the Nasdaq stock market.

Liquidity and Going Concern

The Company, since its inception, has incurred recurring operating losses and negative cash flows from operations and has an accumulated deficit of $266.9 million as of December 31, 2022. The Company expects to incur substantial losses and negative cash flows in future periods. Further, the Company’s future operations, which include the satisfaction of current obligations, are dependent on the success of the Company’s ongoing development and commercialization efforts, as well as securing of additional financing and generating positive cash flows from operations. There is no assurance that the Company will have adequate cash balances to maintain its operations.

Although the Company plans to finance its operations and cash flow needs through equity and/or debt financing, collaboration arrangements with other entities, license royalty agreements, joint ventures, as well as revenue from future product sales, the Company does not believe its current cash balances are sufficient to funds its operating plan through one year from the issuance of these consolidated financial statements. The Company has an immediate need to raise cash. There can be no assurance that additional funding will be available to the Company on acceptable terms, or on a timely basis, if at all, or that the Company will generate sufficient cash from operations to adequately fund operating needs. If the Company is unable to obtain an adequate level of financing needed for the long-term development and commercialization of our products, the Company will need to curtail planned activities and reduce costs. Doing so will likely have an adverse effect on our ability to execute our business plan; accordingly, there is substantial doubt about the ability of the Company to continue in existence as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Commitments and Contingencies - Revenue Sharing Commitment Update and Legal Proceedings (Details) - SEED - USD ($)		12 Months Ended
	Dec. 14, 2017	Dec. 31, 2022
Long-term Purchase Commitment [Line Items]
Percentage of revenue sharing commitment	15.00%
Percentage of revenue sharing commitment after first million dollars of revenue	20.00%
Payments made to date to SEED		$ 0

Debt - Notes Payable (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Notes payable
Notes payable - non-current, net	$ 17,744	$ 25,022
Notes payable - current, net	15,883	3,184
Notes payable
Notes payable
Principal amount of debt	47,255	45,503
Less: unamortized discount and debt issuance costs	(13,628)	(17,297)
Notes payable, net of discount	33,627	28,206
Notes payable - non-current, net	17,744	25,022
Notes payable - current, net	15,883	3,184
Royalty Interest \| Notes payable
Notes payable
Principal amount of debt	38,931	37,000
Streeterville Note \| Notes payable
Notes payable
Principal amount of debt	7,840	7,818
Insurance Financing \| Notes payable
Notes payable
Principal amount of debt	234	335
Tempesta Note \| Notes payable
Notes payable
Principal amount of debt	$ 250	$ 350

Debt - 2019 Tempesta Notes (Details) - Tempesta Note - USD ($)	1 Months Ended	12 Months Ended
	Oct. 31, 2019	Dec. 31, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Cash received in the settlement	$ 50,000
Principal amount	$ 550,000
Common stock issued in exchange of debt	178
Interest rate (as a percent)	2.50%
Semi-annual principal and interest payments	$ 50,000
Interest expense		$ 10,000	$ 10,000
Carrying value of notes		$ 250,000	$ 350,000

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Dec. 31, 2022	Mar. 24, 2023	Jun. 30, 2022
Document Information [Line Items]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2022
Document Transition Report	false
Entity File Number	001-36714
Entity Registrant Name	JAGUAR HEALTH, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-2956775
Entity Address, Address Line One	200 Pine Street, Suite 400
Entity Address, City or Town	San Francisco
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94104
City Area Code	415
Local Phone Number	371-8300
Title of 12(b) Security	Common Stock, Par Value $0.0001 Per Share
Trading Symbol	JAGX
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
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
ICFR Auditor Attestation Flag	false
Entity Shell Company	false
Entity Public Float			$ 25.0
Auditor Name	RBSM, LLP
Auditor Firm ID	587
Auditor Location	Larkspur, California
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	FY
Entity Central Index Key	0001585608
Amendment Flag	false
Common stock - voting
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		13,862,329
Common stock - non-voting
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		9

Related Party Transactions

12 Months Ended

Dec. 31, 2022

Related Party Transactions

Related Party Transactions

4. Related Party Transactions

BOD Cash Compensation

The Company makes BOD cash compensation on a quarterly basis based on the Director Compensation Program. For the years ended December 31, 2022, and 2021, the Company paid approximately $241,000 and $124,000 cash compensation to its directors.

Summary of Significant Accounting Policies - Revenue Recognition - Collaboration Revenue (Details) - USD ($)		12 Months Ended
	Sep. 24, 2018	Dec. 31, 2022	Dec. 31, 2021
Stockholders' Equity
Collaboration revenue		$ 0	$ 0
Knight
Stockholders' Equity
License agreement term (in years)	15 years
Transfer price receivable upon achievement of certain regulatory and sales milestones	$ 18,000,000

Balance Sheet Components

12 Months Ended

Dec. 31, 2022

Balance Sheet Components

Balance Sheet Components

6. Balance Sheet Components

Inventory

Inventory at December 31, 2022 and 2021 consisted of the following:


	December 31,
	2022		2021
(in thousands)
Raw Material	$	2,101	$	1,248
Work in Process		3,599		2,760
Finished Goods		1,324		892
Inventory	$	7,024	$	4,900

Prelaunch Inventory

Costs capitalized for the Company’s lyophilized drug amounting to $2.1 million and zero as of December 31, 2022, and 2021 are included in the prepayments and other assets account. As of December 31, 2022, the Company has filed the POC for the lyophilized drug to European FDA and expects approval at the end of the first half of 2023. Upon approval, the prelaunch inventory shall be reclassed as part of the Company’s inventory.

Property and Equipment, net

Property and equipment at December 31, 2022 and 2021 consisted of the following:


	December 31,
	2022		2021
(in thousands)
Land	$	396	$	396
Lab equipment		477		424
Clinical equipment		—		65
Software		63		63
Furniture and fixtures		18		—
Computers and peripherals		7		—
Total property and equipment at cost		961		948
Accumulated depreciation		(404)		(298)
Property and equipment, net	$	557	$	650

Depreciation and amortization expense was $171,000 and $33,000 for the years ended December 31, 2022 and 2021, respectively.

Intangible assets, net

Intangible assets, net of amortization, at December 31, 2022 and 2021 consisted of the following:


	December 31,
	2022		2021
(in thousands)
Developed technology	$	25,000	$	25,000
Accumulated developed technology amortization		(9,028)		(7,361)
Developed technology, net		15,972		17,639
In-process research and development		4,800		4,800
In process research and development, net		4,800		4,800
Trademarks		300		300
Accumulated trademark amortization		(108)		(88)
Trademarks, net		192		212
Internal use software costs - registry		1,236		—
Accumulated internal use software costs amortization		(122)		—
Internal use software costs - registry, net		1,114		—
Patents		361	—	—
Total intangible assets, net	$	22,439	$	22,651

Amortization expense of finite-lived intangible assets was $1.8 million and $1.7 million for the years ended December 31, 2022 and 2021.

The following table summarizes the Company’s estimated future amortization expense of intangible assets with finite lives as of December 31, 2022:


(in thousands)	Amounts
2023		1,952
2024		1,952
2025		1,952
2026		1,952
Thereafter		9,831
	$	17,639

Accrued Liabilities

Accrued liabilities at December 31, 2022 and 2021 consisted of the following:


	December 31,		December 31,
(in thousands)	2022		2021
Accrued interest	$	5,489	$	3,456
Accrued audit and tax services		575		167
Accrued vacation		310		281
Accrued payroll and commission		263		120
Accrued legal costs		36		414
Accrued local tax		9		285
Accrued payroll tax		1		58
Accrued chargebacks and discounts		—		335
Accrued distributor services fees		—		250
Accrued consulting		—		47
Accrued other		1,482		1,704
Total	$	8,165	$	7,117

Other accrued liabilities as of December 31, 2022 largely consist of other accrued interests, contract fees and scientific advisory board fees while other accrued liabilities as of December 31, 2021 significantly comprise of contract fees and scientific advisory board fees.

Stockholders' Equity - Subscription Agreement (Details) - Subscription Agreement with SPAC € / shares in Units, $ in Thousands, € in Millions	Nov. 03, 2021 shares	Jun. 01, 2021 EUR (€) USD ($) € / shares shares	Jun. 01, 2021 USD ($)
Stockholders' Equity
Number of ordinary shares \| $		1
Proceeds from issuance of warrants		€ 8.8	$ 10,800
Number of warrants converted for each share		1
Exercise price (in dollars per share) \| € / shares		€ 750
Term of anniversary of consummation of business combination		10 years	10 years
Term of anniversary of listing		5 years	5 years
Issuance of common stock (In shares)	883,000

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

Income Taxes

Schedule of effective tax rate, differed from the federal statutory rate


	December 31,
	2022		2021
Statutory rate	(21.0)	%	(21.0)	%
State taxes	(1.8)	%	—	%
Intercompany transactions	0.2	%	—	%
Valuation allowance	18.3	%	13.4	%
Nondeductible warrant expense	(0.3)	%	—	%
Book loss on debt extinguishment	1.0	%	4.2	%
Foreign rate differential	(0.7)	%	—	%
Other	4.3	%	3.4	%
Effective tax rate	—	%	—	%

Schedule of net deferred tax assets


	December 31,
(In thousands)	2022		2021
Non-current deferred tax assets:
Net operating losses	$	24,773	$	21,153
Tax credits		241		241
Stock compensation		3,042		2,161
Other		1,006		450
		29,062		24,005
Valuation allowance		(28,454)		(19,865)
Net non-current deferred tax assets		608		4,140
Non-current deferred tax liabilities:
Other		(566)		(678)
Property and equipment		(42)		(3,462)
Net non-current deferred tax liability		(608)		(4,140)
Net non-current deferred tax asset (liability)	$	—	$	—

Schedule of reconciliation of the beginning and ending amounts of unrecognized tax benefits


	December 31,
(In thousands)	2022		2021
Gross Unrecognized Tax Benefit--Beginning Balance	$	77	$	77
Increases Related to Tax Positions from Prior Years		—		—
Increases Related to Tax Positions Taken During the Current Year		—		—
Gross Unrecognized Tax Benefit--Ending Balance	$	77	$	77

Stockholders' Equity - Transactions with Oasis Capital and Underwritten Public Offering (Details) - USD ($)					1 Months Ended		2 Months Ended	12 Months Ended
	Feb. 02, 2022	Dec. 10, 2021	Apr. 29, 2021	Jan. 13, 2021	Apr. 30, 2020	Mar. 31, 2020	Feb. 28, 2021	Dec. 31, 2022	Dec. 31, 2021	Sep. 30, 2022	Sep. 29, 2022	Feb. 17, 2022	Dec. 31, 2020
Stockholders' equity								$ (1,356,000)	$ 11,853,000				$ 17,202,000
Total shares authorized								352,475,074
Preferred Stock, Shares Authorized								5,496,239	5,496,239
Minimum
Share Price												$ 1.00
Registered Direct Offering
Number of shares offered			33,987
Gross proceeds from the issuance of common stock			$ 10,800,000
Share Price			$ 317.25
Issuance costs			$ 948,000					$ 2,550,000	$ 2,550,000
At The Market Offering
Amount of shares issued								20,462,000	8,595,000
Issuance costs								$ 103,000	465,000
October 2020 ATM Agreement
Issuance of common stock (In shares)							8,931
Issuance costs							$ 311,000
Sale of worth of shares							$ 5,400,000
December 2021 ATM Agreement
Proceeds from Issuance of Common Stock									$ 20,500,000
Issuance of common stock (In shares)									923,164
December 2021 ATM Agreement \| Maximum
Number of shares offered		15,000,000.0
Amount of shares issued	$ 75,000,000.0
December 2021 ATM Agreement \| Minimum
Amount of shares issued	$ 15,000,000.0
Series E perpetual preferred stock
Preferred Stock, Shares Authorized								4,475,074	4,475,074
Common Stock
Share Price								$ 6.52
Common Stock \| Common stock - voting
Common stock, shares authorized								298,000,000	298,000,000	298,000,000	150,000,000
Common Stock \| Common stock - voting \| At The Market Offering
Issuance of common stock (In shares)								923,164	39,086
Common Stock \| Common stock - non-voting
Common stock, shares authorized								50,000,000	50,000,000
Securities Purchase Agreement \| Registered Direct Offering
Issuance of common stock (In shares)				19,724
Share Price				$ 760.50
Net proceeds				$ 1,600,000
Proceeds from issuance of warrants				$ 15,000,000.0
Equity Line of Credit
Proceeds from Issuance of Common Stock					$ 23,000
Issuance of common stock (In shares)					231
Term of equity purchase agreement						36 months
Equity Line of Credit \| Maximum
Aggregate amount of equity purchase agreement						$ 2,000,000.0

Debt - 2019 Exchange Notes (Details)	1 Months Ended				12 Months Ended
Debt - 2019 Exchange Notes (Details)	Jan. 31, 2021 USD ($) shares	Dec. 31, 2020 USD ($) shares	Sep. 30, 2020 USD ($) $ / shares shares	May 31, 2019 USD ($) item	Dec. 31, 2022 USD ($) shares	Dec. 31, 2021 USD ($) shares
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Loss on extinguishment of debt	$ (753,000)				$ (2,187,000)	$ (753,000)
Outstanding \| shares					0	0
Global amendment agreement
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Increase in principal debt (in percent)			5.00%
Increase in principal debt			$ 2,600,000
Global amendment agreement \| Series D perpetual preferred stock
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Loss on extinguishment of debt		$ (1,300,000)
Stock issued during period, shares, new issues \| shares			842,500
Preferred stock dividend rate (as a percent)			8.00%
Preferred stock dividend payable in arrears			24 months
Fair Value of stock at inception			$ 6,400,000
Preferred stock redemption price \| $ / shares			$ 8.00
Shares issued on conversion \| shares		70,622
Shares converted \| shares		859,348
Outstanding \| shares					0	0
Global amendment agreement \| Series D perpetual preferred stock \| Minimum
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Effective interest rate			12.00%
Global amendment agreement \| Series D perpetual preferred stock \| Maximum
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Effective interest rate			15.00%
December 2020 Purchase Agreement
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Principal amount		$ 1,000,000.0
Exchange Notes
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Number of Napo convertible notes \| item				2
2019 Exchange Note 1
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Convertible debt payable						$ 0
Exchange Note 2
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Principal amount	$ 1,800,000			$ 2,300,000
Common stock issued in exchange of debt \| shares	6,283	5,556
Exchange Note 2 \| Global amendment agreement \| Series D perpetual preferred stock
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Convertible debt payable			$ 0

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Cash flows from operating activities
Net loss and comprehensive loss	$ (49,075,000)	$ (52,600,000)
Adjustments to reconcile net loss and comprehensive loss to net cash used in operating activities:
Amortization of debt issuance costs, debt discount, and non-cash interest expense	11,758,000	5,171,000
Stock-based compensation, vested and released restricted stock units and exercised stock options	3,318,000	3,974,000
Loss on extinguishment of debt	2,187,000	753,000
Depreciation and amortization expense	1,981,000	1,719,000
Shares issued in exchange for services	823,000	16,000
Amortization of operating lease - right-of-use-asset	311,000	94,000
Change in fair value of financial instruments and hybrid instrument designated at Fair Value Option	21,000	1,953,000
Series 3 warrants inducement expense		1,462,000
ELOC warrants inducement expense		172,000
Derecognition of debt discount on settlement of receivables secured borrowing		49,000
Changes in assets and liabilities
Accounts receivable	(170,000)	2,823,000
Other receivable	(251,000)	(407,000)
Inventory	(2,124,000)	(2,118,000)
Prepaid expenses and other current assets	(1,560,000)	(796,000)
Other assets	(550,000)	(408,000)
Accounts payable	902,000	158,000
Accrued liabilities	(360,000)	3,034,000
Operating lease liability	(315,000)	(19,000)
Total cash used in operating activities	(33,104,000)	(34,970,000)
Cash flows from investing activity
Purchase of equipment	(77,000)	(6,000)
Costs incurred in software development activities	(1,598,000)
Total cash used in investing activity	(1,675,000)	(6,000)
Cash flows from financing activities
Proceeds from issuance of shares in At the Market offering, net of issuance and offering costs of $103 and $465 in 2022 and 2021, respectively	20,462,000	8,595,000
Payment of Tempesta Note	(100,000)
Repayment of insurance financing	(1,156,000)	(943,000)
Proceeds from issuance of shares in registered public offering, net of issuance and offering costs of $2,550		23,232,000
Proceeds from issuance of notes payable, net of issuance costs of $50		10,975,000
Proceeds from issuance of shares in PIPE financing		1,751,000
Noncontrolling interest		247,000
Proceeds from exercise of stock options		3,000
Repayment of receivables secured borrowing		(1,822,000)
Payment of ELOC warrants offering costs		(35,000)
Repayment of notes payable		(100,000)
Total cash provided by financing activities	23,181,000	43,937,000
Effects of foreign exchange rate changes on assets and liabilities	16,000
Net (decrease) increase in cash	(11,582,000)	8,961,000
Cash at beginning of the year	17,051,000	8,090,000
Cash at end of the year	5,469,000	17,051,000
Supplemental schedule of cash flow information
Cash paid for interest	23,000	28,000
Supplemental schedule of non-cash financing and investing activities
Insurance financing	1,056,000	1,183,000
Recognition of operating lease - right-of-use asset and operating lease liability	365,000	1,087,000
Shares issued in exchange of partial settlement of royalty interest		1,776,000
Lease modification	0	91,000
Offering costs included in accounts payable and accrued liabilities		13,000
Streeterville
Cash flows from financing activities
Proceeds from notes payable with Streeterville	3,975,000
Supplemental schedule of non-cash financing and investing activities
Shares issued in exchange of notes payable and accrued interest	792,000
Iliad
Supplemental schedule of non-cash financing and investing activities
Shares issued in exchange of notes payable and accrued interest	$ 10,472,000
Series 1, Series 2 and Bridge warrant
Cash flows from financing activities
Proceeds from issuance of shares on conversion of Series 1, Series 2, and 2019 Bridge Note warrants		$ 2,034,000

Stock-Based Compensation

12 Months Ended

Dec. 31, 2022

Stock-Based Compensation

Stock-Based Compensation

11. Stock-Based Compensation

2013 Equity Incentive Plan

In November 2013, the Company's board of directors and sole stockholder adopted the Jaguar Health, Inc. 2013 Equity Incentive Plan (the “2013 Plan”). The 2013 Plan allows the Company's board of directors to grant stock options, restricted stock awards and restricted stock unit awards to employees, officers, directors and consultants of the Company. Following the effective date of the IPO and after effectiveness of any grants under the 2013 Plan that were contingent on the IPO, no additional stock awards will be granted under the 2013 Plan. Outstanding grants continue to be exercisable, however, any unissued shares under the plan and any forfeitures of outstanding options do not rollover to the 2014 Stock Incentive Plan. There were 2 option shares outstanding at December 31, 2022 and 2021.

2014 Stock Incentive Plan

Effective May 12, 2015, the Company adopted the Jaguar Health, Inc. 2014 Stock Incentive Plan (“2014 Plan”). The 2014 Plan provides for the grant of options, restricted stock and restricted stock units to eligible employees, directors and consultants to purchase the Company's common stock. The term of an incentive stock option may not exceed 10 years, except that with respect to any participant who owns more than 10% of the voting power of all classes or our outstanding stock, the term must not exceed 5 years. The 2014 Plan provides for automatic share increases on the first day of each fiscal year in the amount of 2% of the outstanding number of shares of the Company's common stock on last day of the preceding calendar year. The 2014 Plan replaced the 2013 Plan except that all outstanding options under the 2013 Plan remain outstanding until exercised, cancelled or expired.

On April 13, 2022, the Board of Directors of the Company approved a Registration Statement to register an additional 2,417,660 shares of the Company’s common stock for issuance pursuant to the awards granted under the 2014 Plan.

As of December 31, 2022, there were 26,533 options outstanding and 116,011 options available for grant. As of December 31, 2021, there were 31,740 options outstanding and 8,260 options available for grant.

2020 New Employee Inducement Award Plan

Effective June 16, 2020, the Company adopted the Jaguar Health, Inc. New Employee Inducement Award Plan (“2020 Inducement Award Plan”) and, subject to the adjustment provisions of the Inducement Award Plan, reserved 2,222 shares of the Company’s common stock for issuance pursuant to equity awards granted under the Inducement Award Plan. The term of an incentive stock option may not exceed 10 years, except that with respect to any participant who owns more than 10% of the voting power of all classes or our outstanding stock, the term must not exceed 5 years. The 2020 Inducement Award Plan provides for the grant of non-statutory stock options, restricted stock units, restricted stock, and performance shares. The 2020 Inducement Award Plan was adopted without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules. The terms and conditions of the 2020 Inducement Award Plan are substantially similar to the Company’s 2014 Stock Incentive Plan, but with such other terms and conditions intended to comply with the Nasdaq inducement award rules. In accordance with Rule 5635(c)(4) of the Nasdaq Listing Rules, the only persons eligible to receive grants of equity awards under the

Inducement Award Plan are individuals who were not previously an employee or director of the Company, or following a bona fide period of non-employment, as an inducement material to such persons entering into employment with the Company.

On April 13, 2022, the Board of Directors of the Company approved an amendment to the 2020 Inducement Award Plan to reserve an additional 471,833 shares of the Company’s common stock for issuance pursuant to equity awards granted under the Inducement Award Plan, thereby increasing the number of shares of the Company’s common stock issuable thereunder from 500,000 shares to 971,833 shares.

As of December 31, 2022, there were 1,546 options outstanding and 6,967 options available for grant. As of December 31, 2021, there were 1,546 options outstanding and 157 options available for grant. The Company authorized an additional 151,079 shares for the stock incentive plans.

Stock Options and Restricted Stock Units (“RSUs”)

The following table summarized the incentive plan activity for the year ended December 31, 2022 and 2021:


				Weighted		Weighted Average
	Shares	Stock		Average		Remaining	Aggregate
	Available	Options	RSUs	Stock Option		Contractual Life	Intrinsic
(in thousands, except share and per share data)	for Grant	Outstanding	Outstanding	Exercise Price		(Years)	Value*
Outstanding at January 1, 2021	2,652	20,229	5	$	950.90	8.71	$	364
Additional shares authorized	25,358	—	—		—			—
Options granted	(13,547)	13,547	—		405.45			—
Options exercised	—	(42)	—		100.35			—
Options canceled	448	(448)	—		2,285.32			—
RSUs granted	(6,494)	—	6,494		—			—
RSUs vested and released	—	—	—		—			—
RSUs cancelled	—	—	—		—			—
Outstanding at December 31, 2021	8,417	33,286	6,499	$	707.97	8.35	$	3
Additional shares authorized	151,079	—	—		—			—
Options granted	(44)	44	—		23.46			—
Options exercised	—	—	—		—			—
Options canceled	5,251	(5,251)	—		418.34			—
RSUs granted	(41,725)	—	41,725		—			—
RSUs vested and released	—	—	(2,516)		—			—
RSUs cancelled	—	—	(843)		—			—
Outstanding at December 31, 2022	122,978	28,079	44,865	$	592.73	7.19	$	—
Exercisable at December 31, 2022		26,102		$	614.51	7.11	$	—
Vested and expected to vest at December 31, 2022		27,901		$	594.38	7.18	$	—

*Fair market value of Jaguar stock on December 31, 2022 was $6.52 per share.

The intrinsic value is calculated as the difference between the exercise price of the underlying options and the fair market value of the Company's common stock for options that were in-the-money.

The number of options exercised during the year ended December 31, 2022 and 2021 were zero and 42, respectively.

The weighted average grant date fair value of stock options granted was $22.04 and $379.66 per share during the years ended December 31, 2022, and 2021, respectively.

The number of options that vested in the years ended December 31, 2022, and 2021 was 7,492 and 9,280, respectively. The grant date weighted average fair value of options that vested in the years ended
December 31, 2022, and 2021 was $304.57 and $336.60, respectively.

Stock-Based Compensation

The following table summarizes stock-based compensation expense related to stock options, inducement stock options and RSUs for the years ended December 31, 2022 and 2021, and are included in the consolidated statements of operations as follows:


	Year Ended
	December 31,
(in thousands)	2022		2021
Research and development expense	$	1,263	$	1,319
Sales and marketing expense		267		319
General and administrative expense		1,788		2,336
Total	$	3,318	$	3,974

As of December 31, 2022, the Company had $2.7 million of unrecognized stock-based compensation expense for options and RSU’s, which is expected to be recognized over a weighted-average period of 1.70 years.

The fair value of options granted during the years ended December 31, 2022 and 2021, respectively, were calculated using the range of assumptions set forth below:


	Year Ended
	December 31,
	2022	2021
Volatility	164.0%	163.8 - 164.0 %
Expected term (years)	5.0	5.0
Risk-free interest rate	3.2%	0.5 - 1.2 %
Expected dividend yield	—	—

401(k) Plan

The Company sponsors a 401(k) defined contribution plan covering all employees. There were no employer contributions to the plan from plan inception through December 31, 2022.

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Preferred stock, shares authorized	5,496,239	5,496,239
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Notes payable, net of current portion (includes hybrid instrument designated at Fair Value Option)	$ 7,839	$ 7,818
Series B-2 Preferred Stock
Convertible preferred stock, shares authorized	10,165	10,165
Convertible preferred stock, shares issued	0	0
Convertible preferred stock, shares outstanding	0	0
Preferred stock, shares authorized	10,165	10,165
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Series C perpetual preferred stock
Preferred stock, shares authorized	1,011,000	1,011,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Series E perpetual preferred stock
Preferred stock, shares authorized	4,475,074	4,475,074
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common Stock \| Common stock - voting
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	298,000,000	298,000,000
Common stock, shares issued	2,182,084	644,700
Common stock, shares outstanding	2,182,084	644,700
Common Stock \| Common stock - non-voting
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	2,120,786	2,120,786
Common stock, shares outstanding	2,120,786	2,120,786

Net Loss Per Share Attributable to Common Stockholders - Excluded From Calculation (Details) - shares	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Mar. 24, 2023
Outstanding common stock equivalents have been excluded from diluted net loss per common share
Total (in shares)	80,449	47,298
Common stock, shares issued			11,680,245
Options issued and outstanding
Outstanding common stock equivalents have been excluded from diluted net loss per common share
Total (in shares)	26,533	31,221
Inducement options issued and outstanding
Outstanding common stock equivalents have been excluded from diluted net loss per common share
Total (in shares)	1,546	2,065
Restricted stock units issued and outstanding
Outstanding common stock equivalents have been excluded from diluted net loss per common share
Total (in shares)	44,865	6,499
Warrants issued and outstanding
Outstanding common stock equivalents have been excluded from diluted net loss per common share
Total (in shares)	7,505	7,513

Fair Value Measurements - Estimated fair value of Level 3 (Details)	12 Months Ended
	Dec. 31, 2022 USD ($)
Warrant liability
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning fair value of Level 3 liability	$ 1,000
Ending fair value of level 3 liability	0
Level 3 \| Recurring \| Warrant liability
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning fair value of Level 3 liability	1,000
Change in fair value	(1,000)
Level 3 \| Recurring \| Streeterville Note
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning fair value of Level 3 liability	7,818,000
Change in fair value	21,000
Ending fair value of level 3 liability	$ 7,839,000

Net Loss Per Share Attributable to Common Stockholders (Tables)

12 Months Ended

Dec. 31, 2022

Net Loss Per Share Attributable to Common Stockholders

Schedule of calculation of basic and diluted net loss per common share



	Year Ended December 31,
(In thousands, except share and per share data)	2022		2021
Net loss attributable to common stockholders (basic and diluted)	$	(47,454)	$	(52,595)
Shares used to compute net loss per common share, basic and diluted		1,311,519		596,154
Net loss per share attributable to common stockholders, basic and diluted	$	(36.18)	$	(88.22)

Schedule of common stock equivalents excluded from the calculation of diluted net loss per common share


	Year Ended
	December 31,
	2022	2021
Options issued and outstanding	26,533	31,221
Inducement options issued and outstanding	1,546	2,065
Restricted stock units issued and outstanding	44,865	6,499
Warrants issued and outstanding	7,505	7,513
Total	80,449	47,298

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2022

Fair Value Measurements

Summary of information about the company's financial instruments that were measured at fair value on a recurring basis


	December 31, 2022
(in thousands)	Level 1		Level 2		Level 3		Total
Warrant liability	$	—	$	—	$	—	$	—
Streeterville note		—		—		7,839		7,839
Total fair value	$	—	$	—	$	7,839	$	7,839


	December 31, 2021
(in thousands)	Level 1		Level 2		Level 3		Total
Warrant liability	$	—	$	—	$	1	$	1
Streeterville note	$	—	$	—	$	7,818	$	7,818
Total fair value	$	—	$	—	$	7,819	$	7,819

Summary of change in the estimated fair value of level 3 liabilities


	Year Ended
	December 31, 2022
(in thousands)	Warrant liability		Streeterville note
Beginning fair value of Level 3 liability	$	1	$	7,818
Additions		—		—
Exercises		—		—
Change in fair value		(1)		21
Ending fair value of Level 3 liability	$	—	$	7,839

Summary of information about the significant unobservable inputs used in level 3 fair value measurements


	Range of Inputs
	(probability-weighted average)		Relationship of unobservable inputs
Unobservable Inputs	2022	2021	to fair value
Risk Adjusted Discount Rate	11.53%-26.06% (26.06%)	6.78% - 21.31% (21.31%)	If discount rate is adjusted to total of additional 100 basis points (bps), fair value would have decreased by $364,000. If discount rate is adjusted to total deduction of 100 bps, fair value would have increased by $364,000.
Sales Proceeds: Amount of comparable TDPRV	$67.5 million to $350 million ($100 million)	$67.5 million to $350.0 million ($100.0 million)	If expected cash flows by Management considered the lowest amount of market indications for vouchers, FV would have decreased by $940,000. If expected cash flows by Management considered the highest amount of market indications for vouchers, FV would have increased by $7.23 million.
Range of Probability for Timing of Cash Flows: Variations of the terms and conditions of the timing of cash flows, including settlement of the note principal, interest, penalties, and acceleration clause.	0.39%-46.55%	0.35%-46.06%	If expected cash flows by Management considered the Scenario with the least amount of indicated value, FV would have decreased by $692,000. If expected cash flows by Management considered the scenario with the greatest amount of indicated value, FV would have increased by $1.51 million.

Summary of the fair value and unpaid principal balance for items the Company accounts for under FVO


(in thousands)	Fair value		Unpaid Principal Balance		Fair Value Over (Under) Unpaid Principal Balance
At December 31, 2022
Hybrid Instrument:
Streeterville note	$	7,839	$	6,221	$	1,618


(in thousands)	Fair value		Unpaid Principal Balance		Fair Value Over (Under) Unpaid Principal Balance
At December 31, 2021
Hybrid Instrument:
Streeterville note	$	7,818	$	6,221	$	1,597

Balance Sheet Components - Estimated future amortization expense (Details) $ in Thousands	Dec. 31, 2022 USD ($)
Balance Sheet Components
2023	$ 1,952
2024	1,952
2025	1,952
2026	1,952
Thereafter	9,831
Finite-lived intangible assets, net	$ 17,639

Commitments and Contingencies - Asset Transfer and Transition Commitment Update (Details) - USD ($) $ in Millions		12 Months Ended
	Sep. 25, 2017	Dec. 31, 2022	Dec. 31, 2021
Commitments and Contingencies
Percentage of amount received to be paid to Glenmark	25.00%
Maximum amount to be received by Glenmark	$ 7.0
Payments to Glenmark		$ 2.6	$ 2.0

Commitments and Contingencies - Master Services Agreement (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021	Oct. 05, 2020
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Lease liabilities	$ 1,208	$ 1,159
Master Services Agreement With Integrium LLC, 2020
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Lease liabilities	$ 1,900	$ 1,700
Master Services Agreement With Integrium LLC, 2020 \| Maximum
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Consideration payable on achievement of milestones			$ 12,400

Stock-Based Compensation - 401(k) Plan (Details)	12 Months Ended
Stock-Based Compensation - 401(k) Plan (Details)	Dec. 31, 2022 USD ($)
Stock-Based Compensation
Employer contributions to the plan	$ 0

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($)	Series 1, Series 2 and Bridge warrant Common Stock Common stock - voting	Series 1, Series 2 and Bridge warrant Additional paid-in capital	Series 1, Series 2 and Bridge warrant	Series 3 warrants Common Stock Common stock - voting	Series 3 warrants Additional paid-in capital	Series 3 warrants	ELOC Additional paid-in capital	ELOC	Private Investment in Public Entities Common Stock Common stock - voting	Private Investment in Public Entities Additional paid-in capital	Private Investment in Public Entities	Underwriter Settlement Agreement Noncontrolling Interest	Underwriter Settlement Agreement Accumulated deficit	Underwriter Settlement Agreement	At The Market Offering Common Stock Common stock - voting	At The Market Offering Additional paid-in capital	At The Market Offering	Registered public offering Common Stock Common stock - voting	Registered public offering Additional paid-in capital	Registered public offering	Common Stock Common stock - voting Streeterville	Common Stock Common stock - voting Iliad	Common Stock Common stock - voting	Common Stock Common stock - non-voting	Additional paid-in capital Streeterville	Additional paid-in capital Iliad	Additional paid-in capital	Noncontrolling Interest	Accumulated deficit	Accumulated other comprehensive loss	Streeterville	Iliad	Total
Beginning Balance at Dec. 31, 2020																											$ 184,101,000		$ (166,899,000)				$ 17,202,000
Beginning Balance (in shares) at Dec. 31, 2020																							506,765	2,120,786
Increase (decrease) in Stockholders' Equity (Deficit)
Issuance of common stock										$ 1,751,000	$ 1,751,000					$ 8,595,000	$ 8,595,000		$ (23,232,000)	$ (23,232,000)
Issuance of common stock (In shares)									9,679						39,086			53,711
Shares issued in exchange of notes payable and accrued interest																										$ 2,982,000						$ 2,982,000
Shares issued in exchange of notes payable and accrued interest (in shares)																						7,843
Shares issued in extinguishment of Exchange Note 2																											2,516,000						2,516,000
Shares issued in extinguishment of Exchange Note 2 (in shares)																							6,283
Shares issued to other third party for services																											16,000						16,000
Shares issued to other third party for services (in shares)																							75
Shares issued on exercise of warrants		$ 2,034,000	$ 2,034,000		$ 1,776,000	$ 1,776,000
Shares issued on exercise of warrants (in shares)	18,447			2,759
Shares issued upon exercise of stock options																											4,000						4,000
Shares issued upon exercise of stock options (in shares)																							42
Shares issued on conversion of Napo merger common shares (in shares)																							10
Acquisition of a subsidiary																												$ 247,000					247,000
Issuance of warrants							$ 124,000	$ 124,000
Stock-based compensation																											3,974,000						3,974,000
Net loss												$ (5,000)	$ (52,595,000)	$ (52,600,000)																			(52,600,000)
Translation adjustments																																	0
Ending Balance at Dec. 31, 2021																											231,105,000	242,000	(219,494,000)				11,853,000
Ending Balance (in shares) at Dec. 31, 2021																							644,700	2,120,786
Increase (decrease) in Stockholders' Equity (Deficit)
Issuance of common stock																$ 20,462,000	$ 20,462,000
Issuance of common stock (In shares)															923,164
Shares issued in exchange of notes payable and accrued interest																									$ 5,056,000	$ 6,207,000					$ 5,056,000	$ 6,207,000
Shares issued in exchange of notes payable and accrued interest (in shares)																					310,196	235,461
Shares issued to Synworld for services																											800,000						800,000
Shares issued to Synworld for services (in shares)																							45,896
Shares issued to other third party for services																											23,000						23,000
Shares issued to other third party for services (in shares)																							20,151
Shares issued upon vesting and release of restricted stock units																											100,000						100,000
Shares issued upon vesting and release of restricted stock units (in shares)																							2,516
Stock-based compensation																											3,218,000						3,218,000
Net loss																												(941,000)	(47,454,000)				(48,395,000)
Translation adjustments																														$ (680,000)			(680,000)
Ending Balance at Dec. 31, 2022																											$ 266,971,000	$ (699,000)	$ (266,948,000)	$ (680,000)			$ (1,356,000)
Ending Balance (in shares) at Dec. 31, 2022																							2,182,084	2,120,786

Commitments and Contingencies - Commitments (Details)										1 Months Ended						12 Months Ended
Commitments and Contingencies - Commitments (Details)	Jan. 25, 2022 EUR (€)	Jan. 25, 2022 USD ($)	Dec. 24, 2021 USD ($)	Dec. 22, 2021 EUR (€)	Dec. 22, 2021 USD ($)	Oct. 07, 2021 EUR (€)	Oct. 07, 2021 USD ($)	Apr. 06, 2021 USD ($) ft²	Aug. 31, 2020 USD ($) ft²	Nov. 30, 2022 EUR (€) item	Nov. 30, 2022 USD ($) item	Oct. 31, 2022 EUR (€) item	Oct. 31, 2022 USD ($) item	May 31, 2022 EUR (€) item	May 31, 2022 USD ($) item	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)	Jan. 26, 2022	Dec. 21, 2021 item
Commitments and Contingencies
Lease expense under non-cancelable operating lease	€ 4,000	$ 4,200	$ 21,000
Lease cost																	$ 282,000
Cash paid for operating lease liabilities recognized under operating cash flows																$ 315,000	105,260
Lease modification																0	91,000
Recognition of operating lease - right-of-use asset and operating lease liability																365,000	1,087,000
Total deposit paid	9,000	9,500
General and administrative expense
Commitments and Contingencies
Lease expense under non-cancelable operating lease																0	75,000
Lease cost																629,000	$ 282,000
If contracts are terminated within 12 months
Commitments and Contingencies
Lease expense under non-cancelable operating lease	€ 3,817	$ 4,000
Office space sub lease
Commitments and Contingencies
Area (in square feet) \| ft²								10,526	5,263
Sub lease rent									$ 15,000
Remaining commitment																$ 0
Extension period								3 years
Lease term								3 years
Monthly base rent for first twelve months								$ 42,000
Monthly base rent for subsequent twelve months								43,000
Monthly base rent for final 12 months								$ 45,000
Leased office premises
Commitments and Contingencies
Extension period																		20 months
Leased vehicle
Commitments and Contingencies
Lease expense under non-cancelable operating lease										€ 1,459	$ 1,500	€ 2,094	$ 2,200
Lease term										48 months	48 months	48 months	48 months
Number of vehicles on lease \| item										2	2	3	3
Copernico Centrale agreement \| Leased office premises
Commitments and Contingencies
Lease expense under non-cancelable operating lease						€ 10,000	$ 10,500
Extension period																		20 months
Total deposit paid						€ 20,000	$ 21,000
Arval Service Lease Italia Spa agreement \| Leased vehicle
Commitments and Contingencies
Lease expense under non-cancelable operating lease				€ 2,000	$ 2,100
Lease term				48 months	48 months
Number of vehicles on lease \| item																			2
Total deposit paid				€ 19,000	$ 20,000
ALD Automative Italia S.r.l \| Leased vehicle
Commitments and Contingencies
Lease expense under non-cancelable operating lease														€ 833	$ 880
Lease term														48 months	48 months
Number of vehicles on lease \| item														1	1
Total deposit paid														€ 21,000	$ 22,000

Summary of Significant Accounting Policies - Property and Equipment and Indefinite-lived Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Goodwill impairment charges
Impairment of long-lived assets	$ 0	$ 0
Impairment of indefinite-lived intangible assets	$ 0	$ 0
Napo Member \| Equipment \| Minimum
Goodwill
Estimated useful lives	3 years
Napo Member \| Equipment \| Maximum
Goodwill
Estimated useful lives	10 years

Income Taxes - Reconciliation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Reconciliation of the beginning and ending amounts of unrecognized tax benefits
Gross Unrecognized Tax Benefit - Beginning Balance	$ 77	$ 77
Increases Related to Tax Positions from Prior Years	0	0
Gross Unrecognized Tax Benefit - Ending Balance	$ 77	$ 77

Stockholders' Equity

12 Months Ended

Dec. 31, 2022

Stockholders' Equity

Stockholders' Equity

10. Stockholders’ Equity

As of December 31, 2022 and 2021, the Company had reserved shares of common stock, on an as-if converted basis, for issuance as follows:


	December 31,
	2022	2021
Options issued and outstanding	26,533	31,221
Inducement options issued and outstanding	1,546	2,065
Options available for grant under stock option plans	122,978	8,417
Restricted stock unit awards issued and outstanding	44,865	6,499
Warrants issued and outstanding	7,505	7,513
Total	203,427	55,715

Common Stock

The holders of common stock are entitled to one vote for each share of common stock held. The common stockholders are also entitled to receive dividends whenever funds and assets are legally available and when declared by the Board of Directors.

The holders of non-voting common stock are not entitled to vote, except on an as converted basis with respect to any change of control of the Company that is submitted to the stockholders of the Company for approval. Shares of the Company's non-voting common stock have the same rights to dividends and other distributions and are convertible into shares of the Company's common stock on a one-for-one basis.

At a special meeting of stockholders of Jaguar Health, Inc. (the “Company”) held on September 30, 2022 (the “Special Meeting”), the Company’s stockholders approved an amendment (the “Sixth Amendment”) to the Company’s Third Amended and Restated Certificate of Incorporation (the “COI”) to effect an increase in the number of authorized shares of the Company’s voting common stock, par value $0.0001 per share (the “Common Stock”), from 150,000,000 to 298,000,000 shares of Common Stock (the “Authorized Share Increase”) on September 30, 2022.

Pursuant to such authority granted by the Company’s stockholders, the Company’s board of directors approved the Authorized Share Increase and the filing of the Sixth Amendment to effectuate the Authorized Share Increase. On September 30, 2022, the Company filed the Sixth Amendment with the Secretary of State of the State of

Delaware (the “DE Secretary of State”), and the Authorized Share Increase became effective in accordance with the terms of the Sixth Amendment immediately upon filing with the DE Secretary of State (the “Effective Time”).

The Company is now authorized to issue a total number of 352,475,074 shares, of which 298,000,000 shares are common stock, 50,000,000 are non-voting common stock and 4,475,074 are preferred stock.

Reverse Stock-Split

On September 3, 2021, the Company filed an amendment to its Third Amended and Restated Certificate of Incorporation with the Secretary of State of Delaware to effect a 1-for-3 reverse stock split of the Company’s issued and outstanding shares of voting common stock, effective September 8, 2021. Upon effectivity, every three shares of the Company’s issued and outstanding common stock immediately prior to the effective time shall automatically be reclassified into one share of common stock without any change in the par value.

On January 20, 2023, the Company approved another amendment to the Company’s Third Amendment and Restated Certificate of Incorporation to effect a 1-for-75 reverse stock split of the Company’s issued and outstanding shares of voting common stock, effective January 23, 2023. Upon effectivity, every seventy-five shares of the Company’s issued outstanding common stock immediately prior to the effective time shall automatically be reclassified into one share of common stock without any change in the par value.

The reverse stock splits reduces the number of shares of common stock issuable upon the conversion of the Company’s outstanding non-voting common stock and the exercise or vesting of its outstanding stock options and warrants in proportion to the ratio of the reverse stock split and causes a proportionate increase in the conversion and exercise prices of such non-voting common stock, stock options and warrants. In addition, the number of shares reserved for issuance under the Company’s equity compensation plans immediately prior to the effective time will be reduced proportionately. The reverse stock split did not change the total number of authorized shares of common stock or preferred stock.

March 2020 ELOC (Equity Line of Credit)

In March 2020, the Company entered into an equity purchase agreement (the “March 2020 ELOC”) with Oasis Capital, which provides that Oasis Capital is committed to purchase up to an aggregate of $2.0 million shares of the Company’s common stock over the 36-month term of the March 2020 ELOC.

In April 2020, the Company sold 231 common shares to Oasis for gross proceeds of $23,000. As of December 31, 2022 and 2021, the Company had not exercised any further put options to require Oasis Capital to purchase common stock under the equity purchase agreement.

At The Market Offering (“ATM”)

October 2020 ATM Agreement

On October 5, 2020, the Company entered into an ATM Agreement (“October 2020 ATM Agreement”) with Ladenburg, pursuant to which the Company may offer and sell, from time to time through Ladenburg, shares of common stock, subject to the terms and conditions of the October 2020 ATM Agreement. The October 2020 ATM Agreement will terminate upon the earlier of (i) October 5, 2022 and (ii) termination of the October 2020 ATM Agreement as permitted therein.

During January and February 2021, the Company issued an aggregate of 8,931 shares under the October 2020 ATM Agreement for total net proceeds of $5.4 million after commissions and expenses of approximately $311,000. As of December 31, 2022, all shares under the October 2020 ATM Agreement have been issued.

December 2021 ATM Agreement

On December 10, 2021, the Company entered into another ATM Agreement (“December 2021 ATM Agreement”) with Ladenburg, pursuant to which the Company may offer and sell, from time to time through Ladenburg, shares of common stock having an aggregate offering price of up to $15.0 million, subject to the terms and conditions of the December 2021 ATM Agreement. The offering will terminate upon the earlier of (i) December 10, 2024 and (ii) termination of the December 2021 ATM Agreement as permitted therein.

On February 2, 2022, the Company entered into an amendment to the December 2021 ATM Agreement, pursuant to which, the aggregate offering amount of the shares of the Company’s common stock which the Company may sell and issue through Ladenburg, as the sales agent, was increased from $15.0 million to $75.0 million (the “ATM Upsize”).

As of December 31, 2022, the Company has issued 923,164 shares under the December 2021 ATM Agreement for a total net proceeds of $20.5 million.

Securities Purchase Agreement

On January 13, 2021, the Company entered into a securities purchase agreement, pursuant to which the Company agreed to issue and sell, in a registered public offering an aggregate of 19,724 shares of common stock at an offering price of $760.50 per share for gross proceeds of approximately $15.0 million before deducting $1.6 million placement agent fee and related offering expenses. The offering closed on January 15, 2021.

On April 29, 2021, the Company entered into another securities purchase agreement, pursuant to which the Company agreed to issue and sell, in a registered public offering through Ladenburg as the placement agent, an aggregate of 33,987 shares of common stock at an offering price of $317.25 per share for gross proceeds of approximately $10.8 million before deducting placement agent fees and related offering expenses of $948,000. The offering closed on May 3, 2022.

Subscription Agreement

On June 1, 2021, the Company entered into a subscription agreement with the SPAC and its sponsor, pursuant to which Dragon SPAC agreed to issue and sell, in a private placement by Dragon SPAC directly to the Company, units of Dragon SPAC, with each unit consisting of one ordinary share of Dragon SPAC and a warrant to purchase a share, for gross proceeds of approximately €8.8 million (corresponding, as at June 1, 2021, to $10.8 million). Dragon SPAC is an Italy special purpose acquisition company formed for the purpose of entering into a business combination with Napo Therapeutics, with the aim of developing the pharmaceutical activities of Dragon SPAC/Napo Therapeutics combined entity in Europe. Each warrant will entitle the holder thereof to purchase one share at an exercise price of €750 per share at any time prior to the earlier of (i) the 10-year anniversary of the consummation of the business combination and (ii) the five-year anniversary of the listing of the combined entity on a public exchange.

On November 3, 2021, Dragon SPAC issued 883,000 ordinary shares, each reserved to the exercise of warrants pursuant to the warrant agreement approved by Dragon SPAC. As a result, Dragon SPAC became a substantially owned subsidiary, at the same time, the related advances were converted to investment at a stand-alone level eliminated at the consolidated level.

September 2021 PIPE Financing

On September 13, 2021, the Company entered into a securities purchase agreement (the “September 2021 PIPE Financing”) with certain investors, pursuant to which the Company agreed to issue and sell to the investors in a private placement an aggregate of 4,123 unregistered shares of the Company’s common stock for an aggregate purchase price of approximately $776,197 or $188.25 per share.

Noncontrolling Interest

As a result of the merger last November 3, 2021 between Napo EU and Dragon SPAC, the Company assumed a non-controlling interest amounting to $242,000 as of December 31, 2021 which represents minority interest held by an investor in Napo Therapeutics.

For the year ended December 31, 2022, noncontrolling interest decreased by $941,000 due to the share in net loss on Napo Therapeutics’ financial performance.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

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+ Details

Segment Data (Tables)

12 Months Ended

Dec. 31, 2022

Segment Data

Schedule of reportable segments net revenue and net loss


	Year Ended
	December 31,
(in thousands)	2022		2021
Revenue from external customers
Human Health	$	11,741	$	4,273
Animal Health		215		62
Consolidated Totals	$	11,956	$	4,335

Segment net loss
Human Health	$	(18,278)	$	(24,276)
Animal Health		(30,117)		(28,324)
Consolidated Totals	$	(48,395)	$	(52,600)

Schedule of reportable segments assets


	December 31,
(in thousands)	2022		2021

Segment assets
Human Health	$	40,898	$	42,250
Animal Health		128,607		115,580
Total	$	169,505	$	157,830

Schedule of reconciliation of segments assets to the consolidated assets


	December 31,		December 31,
(in thousands)	2022		2021
Total assets for reportable segments	$	169,505	$	157,830
Less: Investment in subsidiary		(29,232)		(29,232)
Less: Intercompany loan		(92,821)		(75,333)
Consolidated Totals	$	47,452	$	53,265

Related Party Transactions - Letter of Credit (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Board of directors
Related party Transactions
Payment of compensation	$ 241,000	$ 124,000

Stockholders' Equity- September 2021 PIPE Financing (Details) - USD ($)		12 Months Ended
	Sep. 13, 2021	Dec. 31, 2022	Dec. 31, 2021
Stockholders' Equity
Noncontrolling interest		$ (699,000)	$ 242,000
Decrease in noncontrolling interest		941,000
Napo Member
Stockholders' Equity
Noncontrolling interest		$ 242,000
September 2021 PIPE Financing
Stockholders' Equity
Stock issued during period, shares, new issues	4,123
Proceeds from Issuance of Private Placement	$ 776,197
Shares Issued, Price Per Share	$ 188.25

- Definition

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which is directly or indirectly attributable to that ownership interest in subsidiary equity which is not attributable to the parent (that is, noncontrolling interest, previously referred to as minority interest).

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+ Details

Preferred Stock - Series E Preferred Stock (Details) - USD ($)	Oct. 04, 2022	Aug. 18, 2022	Dec. 31, 2022	Dec. 31, 2021
Preferred stock, shares issued			0	0
Preferred stock, shares outstanding			0	0
Series E preferred stock
Shares redeemed	10
Preferred stock, shares outstanding	0
SynWorld \| Securities Purchase Agreement \| Series E preferred stock
Preferred stock, shares issued		10
Preferred stock, par value (in dollars per share)		$ 0.0001
Aggregate proceeds		$ 100

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($)
ELOC
Stock Transactions, Parenthetical Disclosures
Issuance costs	$ 48
At The Market Offering
Stock Transactions, Parenthetical Disclosures
Issuance costs	465
Registered public offering
Stock Transactions, Parenthetical Disclosures
Issuance costs	$ 2,550

Income Taxes - Tax provision (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Loss before provision for income taxes	$ (48,395)	$ (52,600)
Foreign loss	(6,300)	(4,600)
Deferred:
Deferred income tax provision	$ 0	$ 0
Effective tax rate, differed from the federal statutory rate
Statutory rate	(21.00%)	(21.00%)
State taxes	(1.80%)
Intercompany transactions	0.20%
Valuation allowance	18.30%	13.40%
Nondeductible warrant expense	(0.30%)
Book loss on debt extinguishment	1.00%	4.20%
Foreign rate differential	(0.70%)
Other	4.30%	3.40%
Effective tax rate	0.00%	0.00%
Non-current deferred tax assets:
Net operating losses	$ 24,773	$ 21,153
Tax credits	241	241
Stock compensation	3,042	2,161
Other	1,006	450
Gross non-current deferred tax assets	29,062	24,005
Valuation allowance	(28,454)	(19,865)
Net non-current deferred tax assets	608	4,140
Non-current deferred tax liabilities:
Other	(566)	(678)
Property and equipment	(42)	(3,462)
Net non-current deferred tax liability	(608)	(4,140)
Increase in valuation allowance	8,600
Domestic Tax Authority [Member]
Loss before provision for income taxes	$ (42,100)	$ (48,000)

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Revenue
Total revenue	$ 11,956,000	$ 4,335,000
Operating expenses
Cost of product revenue	2,019,000	2,333,000
Research and development	17,647,000	15,079,000
Sales and marketing	8,837,000	8,894,000
General and administrative	17,868,000	17,103,000
Series 3 warrants inducement expense		1,462,000
ELOC warrants inducement expense		172,000
Total operating expenses	46,371,000	45,043,000
Loss from operations	(34,415,000)	(40,708,000)
Interest expense	(12,723,000)	(8,421,000)
Loss on extinguishment of debt	(2,187,000)	(753,000)
Change in fair value of financial instruments and hybrid instrument designated at Fair Value Option	(20,000)	(1,953,000)
Other income (expense)	950,000	(765,000)
Loss before income tax	(48,395,000)	(52,600,000)
Income tax expense	0	0
Net loss	(48,395,000)	(52,600,000)
Net loss attributable to noncontrolling interest	(941,000)	(5,000)
Net loss attributable to common stockholders	(47,454,000)	(52,595,000)
Net loss attributable to common shareholders (diluted)	$ (47,454,000)	$ (52,595,000)
Net loss per share, basic	$ (36.18)	$ (88.22)
Net loss per share, diluted	$ (36.18)	$ (88.22)
Weighted-average common shares outstanding, basic	1,311,519	596,154
Weighted-average common shares outstanding, diluted	1,311,519	596,154
Product revenue
Revenue
Total revenue	$ 11,956,000	$ 4,335,000

CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Notes payable
Debt issuance costs	$ 50,000	$ 50,000
Registered Direct Offering
Issuance costs	2,550,000	2,550,000
At The Market Offering
Issuance costs	$ 103,000	$ 465,000

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Current assets:
Cash	$ 5,469	$ 17,051
Accounts receivable	1,879	1,709
Other receivable	588	435
Inventory	7,024	4,900
Prepaid expenses and other current assets	7,361	4,339
Total current assets	22,321	28,434
Property and equipment, net	557	650
Operating lease - right-of-use asset	1,140	1,084
Intangible assets, net	22,439	22,651
Other assets	995	446
Total assets	47,452	53,265
Current liabilities:
Accounts payable	5,808	4,929
Accrued liabilities	8,165	7,117
Warrant liability		1
Operating lease liability, current	483	240
Notes payable, current	15,883	3,184
Total current liabilities	30,339	15,471
Operating lease liability, net of current portion	725	919
Notes payable, net of discount, net of current portion (includes hybrid instrument designated at Fair Value Option amounting to $7.8 million as of December 31, 2022 and December 31, 2021, respectively)	17,744	25,022
Total liabilities	48,808	41,412
Commitments and contingencies (See Note 5)
Stockholders' equity (deficit)
Additional paid-in capital	266,971	231,105
Noncontrolling interest	(699)	242
Accumulated deficit	(266,948)	(219,494)
Accumulated other comprehensive loss	(680)
Total Stockholders' equity (deficit)	(1,356)	11,853
Total liabilities and Stockholders' equity (deficit)	47,452	53,265
Series B-2 Preferred Stock
Stockholders' equity (deficit)
Preferred stock value
Series C perpetual preferred stock
Stockholders' equity (deficit)
Preferred stock value
Series E perpetual preferred stock
Stockholders' equity (deficit)
Preferred stock value
Common stock - non-voting
Stockholders' equity (deficit)
Common stock value

Segment Data

12 Months Ended

Dec. 31, 2022

Segment Data

Segment Data

14. Segment Data

The Company has two reportable segments-human health and animal health. The animal health segment is focused on developing and commercializing prescription and non-prescription products for companion and production animals. The human health segment is focused on developing and commercializing of human products and the ongoing commercialization of Mytesi, which is approved by the U.S. FDA for the symptomatic relief of non-infectious diarrhea in adults with HIV/AIDS on antiretroviral therapy.

The Company’s reportable segments sales and net income consisted of:


	Year Ended
	December 31,
(in thousands)	2022		2021
Revenue from external customers
Human Health	$	11,741	$	4,273
Animal Health		215		62
Consolidated Totals	$	11,956	$	4,335

Segment net loss
Human Health	$	(18,278)	$	(24,276)
Animal Health		(30,117)		(28,324)
Consolidated Totals	$	(48,395)	$	(52,600)

The Company’s reportable segments assets consisted of the following:


	December 31,
(in thousands)	2022		2021

Segment assets
Human Health	$	40,898	$	42,250
Animal Health		128,607		115,580
Total	$	169,505	$	157,830

The reconciliation of segments assets to the consolidated assets is as follows:


	December 31,		December 31,
(in thousands)	2022		2021
Total assets for reportable segments	$	169,505	$	157,830
Less: Investment in subsidiary		(29,232)		(29,232)
Less: Intercompany loan		(92,821)		(75,333)
Consolidated Totals	$	47,452	$	53,265

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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+ Details

Balance Sheet Components - Amortization (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Balance Sheet Components
Amortization expense	$ 1.8	$ 1.7

Subsequent Events

12 Months Ended

Dec. 31, 2022

Subsequent Events

Subsequent Events

15. Subsequent Events

December 2021 ATM Agreement

Subsequent to December 31, 2022, the Company has issued an additional 10,135,550 shares under the December 2021 ATM Agreement with a total net proceeds of $17.5 million.

Formation of Joint Venture Magdalena Biosciences, Inc.

In January 2023, Jaguar and Filament Health (“Filament”), with Funding from One Small Planet, formed the U.S.-based joint venture Magdalena Biosciences, Inc. (“Magdalena”). Magdalena’s focus is on the development of novel, natural prescription medicines derived from plants for mental health indications including, initially, attention-deficit/hyperactivity disorder (“ADHD”) in adults. The goal of the collaboration is to extend the botanical drug development capabilities of Jaguar and Filament in order to develop pharmaceutical-grade, standardized drug candidates for mental health disorders, and to partner with a potential future licensee to develop and commercialize these novel plant-based drugs. This new venture aligns with Jaguar's mental health Entheogen Therapeutics Initiative (“ETI”) and Filament's corporate mission to develop novel, natural prescription medicines from plants. Magdalena will leverage Jaguar's proprietary medicinal plant library and Filament's proprietary drug development technology. Jaguar’s library of 2,300 highly characterized medicinal plants and 3,500 plant extracts, all from firsthand ethnobotanical investigation by Jaguar and members of the ETI Scientific Strategy Team, is a key asset we have generated over 30 years that bridges the knowledge of traditional healers and Western medicine. Magdalena holds an exclusive license to plants and plant extracts in Jaguar's library, not including any sources of crofelemer or NP-300, for specific indications and is in the process of identifying plant candidates in the library that may prove beneficial for addressing indications such as ADHD.

December 2020 Royalty Interest Exchange Agreement

On February 8, 2023, the Company entered into an exchange agreement (the “December 2020 Royalty Interest Exchange Agreement”) with Irving to (i) partition a new royalty interest in the royalty repayment amount of $675,000 (“Partitioned Royalty”) from the royalty interest of the December 2020 Purchase Agreement and then cause the outstanding balance of the royalty interest to be reduced by an amount equal to the initial outstanding balance of the Partitioned Royalty, and (ii) exchange (“Royalty Exchange”) the Partitioned Royalty for 150,000 shares of the Company’s common stock with a par value of $0.0001 in accordance with term of the December 2020 Royalty Interest Exchange Agreement. Under the terms of the December 2020 Royalty Interest Exchange Agreement, the

Royalty Exchange will consist of Irving surrendering the Partitioned Royalty in exchange for the shares, free of any restrictive securities legend, and Irving shall give no consideration of any kind whatsoever to the Company in connection with the December 2020 Royalty Interest Exchange Agreement.

October 2020 Royalty Interest Exchange Agreements

On March 17 and 23, 2023, the Company entered into exchange agreements (the “October 2020 Royalty Interest Exchange Agreements”) with Iliad to (i) partition new royalty interests in the royalty repayment amounts of $992,000 and $227,000, respectively (“Partitioned Royalties”) from the royalty interest of the October 2020 Purchase Agreement and then cause the outstanding balance of the royalty interest to be reduced by an amount equal to the initial outstanding balance of the Partitioned Royalties, and (ii) exchange (“Royalty Exchanges”) the Partitioned Royalties for 1,090,000 and 280,005 shares, respectively of the Company’s common stock with a par value of $0.0001 in accordance with term of the October 2020 Royalty Interest Exchange Agreements. Under the terms of the October 2020 Royalty Interest Exchange Agreements, the Royalty Exchanges will consist of Iliad surrendering the Partitioned Royalties in exchange for the shares, free of any restrictive securities legend, and Iliad shall give no consideration of any kind whatsoever to the Company in connection with the October 2020 Royalty Interest Exchange Agreements.

Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard

On January 5, 2023, the Company received notice from the Listing Qualifications Staff (“Staff”) of Nasdaq indicating that, because the bid price for the Company’s voting common stock, par value $0.0001 per share had closed below $0.10 per share for the preceding ten consecutive trading days, in contravention of Nasdaq Listing Rule 5810(3)(A)(iii) (the “$0.10 Rule”), the Company’s securities were subject to delisting unless the Company timely requested a hearing before the Nasdaq Hearings Panel (the “Panel”) to appeal the Staff’s decision. The Company intends to timely request a hearing before the Panel, which request will stay any further delisting action by Nasdaq at least pending the Company’s hearing and the expiration of any extension that the Panel may grant to the Company following such hearing. There are no assurances that a stay will be granted or that a favorable decision will be obtained.

Nasdaq previously granted the Company a 180-calendar grace period to regain compliance with the minimum $1.00 bid price requirement set forth in Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”) through February 13, 2023.

At the Special Meeting of Stockholders of the Company held on January 20, 2023, the Company received stockholder approval for the implementation of a reverse stock split of the Company’s issued and outstanding Common Stock at a ratio of not less than 1-for-3 and not greater than 1-for-75 to regain compliance with the Bid Price rule.

The Company believes that, after taking into account (i) the sale of shares of common stock between January 1, 2023 and March 23, 2023 pursuant to the Company’s December 2021 agreement, (ii) the issuance of 150,000 shares of common stock on February 8, 2023 to Irving in exchange for a $675,000 reduction in the outstanding balance of the royalty interest held by such holder, and (iii) the issuance of 1,090,000 shares of common stock on March 17, 2023 and 280,005 shares of common stock on March 24, 2023 to Iliad in exchange for a $992,000 and $227,000, respectively reduction in the outstanding balance of the royalty interest held by such holder, and based on interim financial data available to the Company, the Company’s stockholders’ equity as of March 24, 2023, exceeds $2.5 million, which is the minimum stockholders’ equity requirement for continued listing on The Nasdaq Capital Market. In addition, the Company’s cash balance as of March 24, 2023, is approximately $13.6 million.

Termination of a Material Definitive Agreement

On October 11, 2022, the Company entered into an Amended and Restated License and Services Agreement (the “License Agreement”) with SynWorld Technologies Corporation (“Licensee”), C&E Telecom, LTD (“C&E Telecom”), and Tao Wang (“Wang”), which License Agreement amended and restated in entirety the License and

Services Agreement, dated as of June 28, 2022, by and among the same parties, as amended by that certain First Amendment to the License and Services Agreement, dated as of August 18, 2022, by and between the Company and Licensee, for the grant of certain licenses by the Company to Licensee to commercialize the Product (as defined in the License Agreement) and the engagement of Licensee by the Company to obtain regulatory approval for the Product to treat all forms of diarrhea in dogs in the Licensee Territory (as defined in the License Agreement).

On January 31, 2023, the Company, Licensee, C&E Telecom and Wang entered into a Mutual Termination of License Agreement (the “Termination Agreement”), pursuant to which the parties agreed to mutually terminate the License Agreement, effective as of January 31, 2023. Following its termination, the License Agreement is void, and there is no liability thereunder on the part of any party thereto except as set forth in the Termination Agreement.

The Termination Agreement contains mutual releases by all parties thereto, for all claims known and unknown, relating and arising out of, or relating to, among other things, the License Agreement, or the transactions contemplated by the License Agreement.

Balance Sheet Components - Intangible assets (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Intangible assets
Finite-lived intangible assets, net	$ 17,639
Total intangible assets, net	22,439	$ 22,651
Developed technology
Intangible assets
Total intangible assets	25,000	25,000
Accumulated amortization	(9,028)	(7,361)
Finite-lived intangible assets, net	15,972	17,639
In process research and development
Intangible assets
Total intangible assets	4,800	4,800
Finite-lived intangible assets, net	4,800	4,800
Trademarks
Intangible assets
Total intangible assets	300	300
Accumulated amortization	(108)	(88)
Total intangible assets, net	192	$ 212
Internal use software costs - registry
Intangible assets
Total intangible assets	1,236
Accumulated amortization	(122)
Finite-lived intangible assets, net	1,114
Patents [Member]
Intangible assets
Finite-lived intangible assets, net	$ 361

Warrants

12 Months Ended

Dec. 31, 2022

Warrants

Warrants

8. Warrants

The following table summarizes information about warrants outstanding and exercisable into shares of the Company’s common stock for the years ended December 31, 2022 and 2021:


	December 31,
	2022	2021
Warrants outstanding, beginning balance	7,513	32,024
Issuances	—	2,250
Exercises	—	(26,761)
Expirations and cancelations	(8)	—
Warrants outstanding, ending balance	7,505	7,513

As of December 31, 2022 and 2021, the Company’s outstanding warrants have an exercise price ranging from $1.47 to $157.5 per common share and generally expires prior to December 31, 2024.

Summary of Significant Accounting Policies - Prelaunch Inventory (Details) - USD ($) $ in Millions	Dec. 31, 2022	Dec. 31, 2021
Prepaid expenses and other current assets
Capitalized costs	$ 2.1	$ 0.0

Fair Value Measurements - Streeterville Note (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021	Jan. 13, 2021
Fair value of liabilities measured on a recurring basis
Fair value	$ 7,839	$ 7,818
Streeterville Note
Fair value of liabilities measured on a recurring basis
Fair value	$ 7,839	$ 7,818	$ 6,000

Warrants - Warrants outstanding and exercisable (Details) - shares	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Warrants
Warrants outstanding, beginning balance	7,513	32,024
Issuances		2,250
Exercises		(26,761)
Expirations and cancelations	(8)
Warrants outstanding, ending balance	7,505	7,513

Fair Value Measurements - Fair Value Option - Hybrid Instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Fair Value Measurements
Fair value	$ 7,839	$ 7,818
Unpaid Principal Balance	6,221	6,221
Fair Value Over (Under) Unpaid Prepaid Balance	$ 1,618	$ 1,597

Net Loss Per Share Attributable to Common Stockholders

12 Months Ended

Dec. 31, 2022

Net Loss Per Share Attributable to Common Stockholders

Net Loss Per Share Attributable to Common Stockholders

12. Net Loss Per Share Attributable to Common Stockholders

The following table presents the calculation of basic and diluted net loss per common share for the years ended December 31, 2022 and 2021:



	Year Ended December 31,
(In thousands, except share and per share data)	2022		2021
Net loss attributable to common stockholders (basic and diluted)	$	(47,454)	$	(52,595)
Shares used to compute net loss per common share, basic and diluted		1,311,519		596,154
Net loss per share attributable to common stockholders, basic and diluted	$	(36.18)	$	(88.22)

Basic net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted-average number of common shares and common share equivalents outstanding for the period. Common stock equivalents are only included when their effect is dilutive. The Company's potentially dilutive securities which include stock options, convertible preferred stock, RSUs and common stock warrants have been excluded from the computation of diluted net loss per share as they would be anti-dilutive. For all periods presented, there is no difference in the number of shares used to compute basic and diluted shares outstanding due to the Company's net loss position.

The following outstanding common stock equivalents have been excluded from diluted net loss per common share for the years ended December 31, 2022 and 2021 because their inclusion would be anti-dilutive:


	Year Ended
	December 31,
	2022	2021
Options issued and outstanding	26,533	31,221
Inducement options issued and outstanding	1,546	2,065
Restricted stock units issued and outstanding	44,865	6,499
Warrants issued and outstanding	7,505	7,513
Total	80,449	47,298

As of March 24, 2023, there were 11,680,245 shares of common stock issued after the balance sheet date. Including these shares will have a material effect on the diluted net loss per common share in future periods.

Balance Sheet Components - Accrued Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Accrued Expenses
Accrued interest	$ 5,489	$ 3,456
Accrued audit and tax services	575	167
Accrued vacation	310	281
Accrued payroll and commission	263	120
Accrued legal costs	36	414
Accrued local tax	9	285
Accrued payroll tax	1	58
Accrued chargebacks and discounts		335
Accrued distributor services fees		250
Accrued consulting		47
Accrued other	1,482	1,704
Total	$ 8,165	$ 7,117

Organization and Business (Details)	12 Months Ended
Organization and Business (Details)	Dec. 31, 2022 segment
Organization and Business
Number of operations segments	2

Subsequent Events (Details)																					1 Months Ended	12 Months Ended
Subsequent Events (Details)	Mar. 24, 2023 USD ($) shares	Mar. 23, 2023 USD ($) $ / shares shares	Mar. 21, 2023 USD ($)	Mar. 17, 2023 USD ($) $ / shares shares	Feb. 08, 2023 USD ($) $ / shares shares	Jan. 23, 2023 $ / shares	Jan. 20, 2023	Jan. 08, 2023 USD ($)	Jan. 05, 2023 $ / shares	Jan. 01, 2023 USD ($) shares	Nov. 18, 2022 shares	Jul. 25, 2022 shares	May 13, 2022 shares	Mar. 09, 2022 shares	Mar. 04, 2022 shares	Mar. 02, 2022 shares	Feb. 17, 2022 $ / shares	Feb. 11, 2022 shares	Sep. 03, 2021	Apr. 13, 2021 shares	Jan. 31, 2023 Plant	Dec. 31, 2021 USD ($) shares	Dec. 31, 2022 USD ($)
Subsequent Events.
Consecutive business days																	30 days
Reverse stock split ratio																			0.33
Cash																						$ 17,051,000	$ 5,469,000
Minimum
Subsequent Events.
Share Price \| $ / shares																	$ 1.00
Filament Health \| Magdalena Biosciences, Inc.
Subsequent Events.
Number of highly characterized medicinal plants \| Plant																					2,300
Number of plant extracts \| Plant																					3,500
Iliad
Subsequent Events.
Stock issued during period, shares, new issues \| shares											73,333	31,546	15,249	24,667	26,667	32,333		23,117		7,843
December 2021 ATM Agreement
Subsequent Events.
Stock issued during period, shares, new issues \| shares																						923,164
Subsequent event
Subsequent Events.
Common stock, par value (in dollars per share) \| $ / shares						$ 0.0001			$ 0.0001
Minimum bid price for Nasdaq listing \| $ / shares									$ 0.10
Consecutive business days									10 days
Grace period									180 days
Reverse stock split ratio						0.01	0.01
Minimum stockholders' equity required for continued listing			$ 2,500,000
Cash			$ 13,600,000
Subsequent event \| Minimum
Subsequent Events.
Share Price \| $ / shares									$ 1.00
Reverse stock split ratio							0.33
Subsequent event \| Maximum
Subsequent Events.
Reverse stock split ratio							0.01
Subsequent event \| December 2020 royalty interest agreements
Subsequent Events.
Aggregate purchase price					$ 675,000
Common stock, par value (in dollars per share) \| $ / shares					$ 0.0001
Stock issued during period, shares, new issues \| shares					150,000
Subsequent event \| Streeterville
Subsequent Events.
Reduction in outstanding balance of royalty interest								$ 675,000
Subsequent event \| Iliad
Subsequent Events.
Stock issued during period, shares, new issues \| shares	280,005
Shares issued on conversion \| shares				1,090,000
Reduction in outstanding balance of royalty interest	$ 227,000			$ 992,000
Subsequent event \| Iliad \| October 2020 royalty interest agreements
Subsequent Events.
Aggregate purchase price		$ 227,000		$ 992,000
Common stock, par value (in dollars per share) \| $ / shares		$ 0.0001		$ 0.0001
Stock issued during period, shares, new issues \| shares		280,005		1,090,000
Subsequent event \| December 2021 ATM Agreement
Subsequent Events.
Additional shares issued \| shares										10,135,550
Total net proceeds of shares issued										$ 17,500,000

Fair Value Measurements - Estimated Fair Value of Warrant Liability (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Warrant liability
Fair Value Assumptions and Methodology for Assets and Liabilities
Fair value of warrant	$ 0	$ 1,000

Stockholders' Equity (Details)				12 Months Ended
Stockholders' Equity (Details)	Jan. 23, 2023 $ / shares	Jan. 20, 2023	Sep. 03, 2021	Dec. 31, 2022 Vote $ / shares shares	Jan. 05, 2023 $ / shares	Sep. 30, 2022 $ / shares shares	Sep. 29, 2022 shares	Dec. 31, 2021 $ / shares shares
Shares of common stock reserved for issuance
Options issued and outstanding				26,533				31,221
Options available for grant under stock option plans				122,978				8,417
RSUs awards issued and outstanding				44,865				6,499
Warrants issued and outstanding				7,505				7,513
Total				203,427				55,715
Number of voting rights entitled for each share of common stock held \| Vote				1
Reverse stock split ratio			0.33
Inducement options issued and outstanding
Shares of common stock reserved for issuance
Options issued and outstanding				1,546				2,065
Convertible non-voting common stock
Shares of common stock reserved for issuance
Reverse stock split ratio				1
Common Stock \| Common stock - voting
Shares of common stock reserved for issuance
Common stock par value (in dollars per share) \| $ / shares				$ 0.0001		$ 0.0001		$ 0.0001
Common stock, shares authorized				298,000,000		298,000,000	150,000,000	298,000,000
Common Stock \| Common stock - non-voting
Shares of common stock reserved for issuance
Common stock par value (in dollars per share) \| $ / shares				$ 0.0001				$ 0.0001
Common stock, shares authorized				50,000,000				50,000,000
Subsequent event
Shares of common stock reserved for issuance
Reverse stock split ratio	0.01	0.01
Common stock par value (in dollars per share) \| $ / shares	$ 0.0001				$ 0.0001
Subsequent event \| Minimum
Shares of common stock reserved for issuance
Reverse stock split ratio		0.33
Subsequent event \| Maximum
Shares of common stock reserved for issuance
Reverse stock split ratio		0.01

Debt

12 Months Ended

Dec. 31, 2022

Debt

Debt

7. Debt

Notes payable at December 31, 2022 and 2021 consisted of the following:


	December 31,
	2022		2021
(in thousands)
Royalty Interest	$	38,931	$	37,000
Streeterville Note		7,840		7,818
Insurance Financing		234		335
Tempesta Note		250		350
		47,255		45,503
Less: unamortized discount and debt issuance costs		(13,628)		(17,297)
Note payable, net of discount	$	33,627	$	28,206
Notes payable - non-current, net	$	17,744	$	25,022
Notes payable - current, net	$	15,883	$	3,184

Future maturities of the notes payable as of December 31, 2022 are as follows:


(in thousands)	Amounts
Years ended December 31,
2023	$	15,882
2024		23,483
2025		50
2026		—
2027		—
		39,415
Less: unamortized discount and debt issuance costs		(13,628)
Total	$	25,787

Future maturities are based on contractual minimum payments. Timing of maturities may fluctuate based on future revenue.

Sale of Future Royalty Interest

October 2020 Purchase Agreement

On October 8, 2020, the Company entered into another royalty interest purchase agreement (the “October 2020 Purchase Agreement”) with Iliad, pursuant to which the Company sold to Iliad a royalty interest entitling Iliad to receive $12.0 million of future royalties on sales of Mytesi and certain up-front license fees and milestone payments from licensees and/or distributors (the “Royalty Repayment Amount”) for an aggregate purchase price of $6.0 million.

Until such time as the Royalty Repayment Amount has been paid in full, the Company will pay Iliad 10% of the Company’s net sales on included products and 10% of worldwide revenues related to upfront licensing fees and milestone payments from licensees and/or distributors, but specifically excluding licensing fees and/or milestone payments that are reimbursements of clinical trial expenses (the “Royalty Payments”). Beginning on the six-month anniversary of the delivery of the October 2020 Purchase Agreement to the Company (the “Purchase Price Date”) and continuing until the 12-month anniversary of the Purchase Price Date, the monthly Royalty Payment shall be the greater of (a) $250,000, and (b) the actual Royalty Payment amount Iliad is entitled to for such month. Beginning on the 12-month anniversary of the Purchase Price Date and continuing until 18-month anniversary of the Purchase Price Date, the monthly Royalty Payment shall be the greater of (a) $400,000 and (b) the actual Royalty Payment amount Iliad is entitled to for such month. Beginning on the 18-month anniversary of the Purchase Price Date and continuing until 24-month anniversary of the Purchase Price Date, the monthly Royalty Payment shall be the greater of (a) $600,000 and (b) the actual Royalty Payment amount Iliad is entitled to for such month. Beginning on the 24-month anniversary of the Purchase Price Date and continuing until the Royalty Repayment Amount has been paid in full, the monthly Royalty Payment shall be the greater of (a) $750,000, and (b) the actual Royalty Payment amount Iliad is entitled to for such month.

The Royalty Interest amount of $12.0 million is classified as debt, net of a $6.0 million discount. Under ASC 470-10-35-3, royalty payments to Iliad will be amortized under the interest method per ASC 835-30. Because there is no set interest rate, and because the royalty payments are variable, the discount rate is variable. After each royalty payment, the Company will use a prospective method to determine a new discount rate based on the revised estimate of remaining cash flows. The new rate is the discount rate that equates the present value of the revised estimate of remaining cash flows with the carrying amount of the debt, and it will be used to recognize interest expense for the remaining periods. At issuance, based on projected cash outflows from future revenue streams, the discount rate was 34.51%.

Pursuant to the October 2020 Purchase Agreement, if the weekly volume weighted average price (“VWAP”) of the Company’s common stock is not equal or greater than the minimum VWAP of $0.9105 at least twice during each calendar month during the six-month period beginning on November 1, 2020, then the Royalty Repayment Amount will be automatically increased by $6.0 million at the end of such six-month period. During the observation period starting November 1, 2020, the Company’s weekly VWAP failed to reach the minimum VWAP of $0.9105 and on November 13, 2020, the Company concluded that the contingent clause has been met, warranting an additional $6.0 million Royalty Repayment Amount, to be added to the outstanding balance commencing on May 10, 2021 for the purpose of cash interest calculation. The change in the Royalty Repayment Amount was accounted for as a debt modification and resulted in a new discount rate of 45.42%.

On April 13, 2021, the Company entered into an exchange agreement with Iliad, pursuant to which the parties agreed to partition $3.0 million from the original outstanding balance of the royalty interest. The parties further agreed to exchange the partitioned royalty for 7,843 shares of the Company’s common stock. The exchange consisted of Iliad surrendering the partitioned royalty in exchange for the exchange shares. The exchange agreement was accounted for as a modification and resulted in a new discount rate of 77.09%. As of December 31, 2022, the forecasted future revenues changed which resulted to a new discount rate of 74.59%.

On February 11, 2022, the Company entered into an exchange agreement with Iliad, pursuant to which the parties agreed to partition $2.4 million from the outstanding balance of the royalty interest. The parties further agreed to exchange the partitioned royalty for 23,117 shares of the Company’s common stock. The exchange consisted of Iliad surrendering the partitioned royalty in exchange for the exchange shares.

On March 2, 2022, the Company entered into an exchange agreement with Iliad, pursuant to which the parties agreed to partition $1.1 million from the outstanding balance of the royalty interest. The parties further agreed to exchange the partitioned royalty for 32,333 shares of the Company’s common stock. The exchange consisted of Iliad surrendering the partitioned royalty in exchange for the exchange shares.

On March 4, 2022, the Company entered into an exchange agreement with Iliad, pursuant to which the parties agreed to partition $800,000 from the outstanding balance of the royalty interest. The parties further agreed to exchange the partitioned royalty for 26,667 shares of the Company’s common stock. The exchange consisted of Iliad surrendering the partitioned royalty in exchange for the exchange shares.

On March 9, 2022, the Company entered into an exchange agreement with Iliad, pursuant to which the parties agreed to partition $700,000 from the outstanding balance of the royalty interest. The parties further agreed to exchange the partitioned royalty for 24,667 shares of the Company’s common stock. The exchange consisted of Iliad surrendering the partitioned royalty in exchange for the exchange shares.

Because the period between the first and last exchanges occurred within a 12-month period and each was individually assessed as a modification, the debt terms that existed prior to the February 13 exchange was used in the application of the 10% test on the cumulative assessment performed. The exchanges were cumulatively accounted for as an extinguishment and resulted in a loss of $2.2 million.

On April 14, 2022, the Company entered into amendments (the “Royalty Interest Global Amendments”) to its existing royalty interests including the Royalty Interest in the original principal amount of $12.0 million under the October 2020 Royalty Interest. The amendment grants the Company at its sole discretion, the right to exchange from time to time, all or any portion of the Royalty Interests for shares of the Company’s common stock at a price per share equal to the Nasdaq Minimum Price (as defined in Nasdaq Listing Rule 5635(d)) as of date of the applicable exchange. Under the Royalty Interest Global Amendments, the Company’s ability to exchange the Royalty Interests for shares of the Company’s common stock is subject to certain limitations, on which the Company will not have such right and issue any common stock to investors if (a) the issuance of the Company’s common shares would cause investor’s beneficial ownership to exceed 4.99% of Company’s issued and outstanding common stock as of such date; (b) any of the exchange conditions has not been satisfied as of the applicable exchange date; and (c) the total cumulative number of shares of the Company’s common stock issued pursuant to the Royalty Interests would exceed the requirements of The Nasdaq Capital Market (including the rules related to the aggregation of offerings under Nasdaq Listing Rule 5635(d) if applicable) (the “Exchange Cap”), unless stockholder approval is obtained to issue more than the Exchange Cap. The Exchange Cap shall be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction.

On May 13, 2022, the Company entered into an exchange agreement with Iliad, pursuant to which the parties agreed to partition $400,000 from the outstanding balance of the royalty interest. The parties further agreed to exchange the partitioned royalty for 15,249 shares of the Company’s common stock. The exchange consisted of Iliad surrendering the partitioned royalty in exchange for the exchange shares.

On July 25, 2022, the Company entered into an exchange agreement with Iliad, pursuant to which the parties agreed to partition $750,000 from the outstanding balance of the royalty interest. The parties further agreed to exchange the partitioned royalty for 31,546 shares of the Company’s stock. The exchange consisted of Iliad surrendering the partitioned royalty in exchange for the exchange shares.

On November 18, 2022, the Company entered into another exchange agreement with Iliad, pursuant to which the parties agreed to partition $715,000 from the outstanding balance of the royalty interest. The parties further agreed

to exchange the partitioned royalty for 73,333 shares of the Company’s stock. The exchange consisted of Iliad surrendering the partitioned royalty in exchange for the exchange shares.

Although there were exchanges that occurred within the 12-month period prior to the May 13, 2022, July 25, 2022 and November 18, 2022 exchanges, these were previously accounted for as extinguishment and, therefore, cumulative assessment was not anymore performed. The exchange agreements were accounted for as a modification. As of December 31, 2022, the forecasted future revenues changed which resulted to a new discount rate of 41.35%.

Interest expense for the years ended December 31, 2022 and 2021 was $3.6 million and $4.2 million, respectively. As of December 31, 2022 and 2021, the carrying value of the debt was $7.3 million and $6.3 million, respectively.

December 2020 Purchase Agreement

On December 22, 2020, the Company entered into a royalty interest purchase agreement (the “December 2020 Purchase Agreement”) with Irving Park Capital, LLC (“Irving”), pursuant to which the Company sold to Irving a royalty interest entitling Irving to receive $12.0 million of future royalties on sales of Mytesi and certain up-front license fees and milestone payments from licensees and/or distributors (the “Royalty Repayment Amount”) for an aggregate purchase price of $6.0 million.

Until such time as the Royalty Repayment Amount has been paid in full, the Company will pay Irving 10% of the Company’s Net Sales on Included Products and 10% of worldwide revenues related to upfront licensing fees and milestone payments from licensees and/or distributors, but specifically excluding licensing fees and/or milestone payments that are reimbursements of clinical trial expenses (the “Royalty Payments”). Beginning on the payment start date and continuing until the 12-month anniversary of the Purchase Price Date, the monthly Royalty Payment shall be the greater of (a) $750,000, and (b) the actual Royalty Payment amount Irving is entitled to for such month.

The Royalty Interest amount of $12.0 million is classified as debt, net of a $6.0 million discount. Under ASC 470-10-35-3, royalty payments to Irving will be amortized under the interest method per ASC 835-30. Because there is no set interest rate, and because the royalty payments are variable, the discount rate is variable. After each royalty payment, the Company will use a prospective method to determine a new discount rate based on the revised estimate of remaining cash flows. The new rate is the discount rate that equates the present value of the revised estimate of remaining cash flows with the carrying amount of the debt, and it will be used to recognize interest expense for the remaining periods. At issuance, based on projected cash outflows from future revenue streams, the discount rate was 23.70%. As of December 31, 2022, the forecasted future revenues changed which resulted to a new discount rate of 29.55%.

On April 14, 2022, under the Royalty Interest Global Amendments, the Company is granted at its sole discretion, the right to exchange from time to time, all or any of the Royalty Interest under the original principal amount of $12.0 million or any portion of the December 2020 Purchase Agreement for shares of the Company’s common stock at a price per share equal to the Nasdaq Minimum Price (as defined in Nasdaq Listing Rule 5635(d)) as of date of the applicable exchange, subject to certain limitations.

Interest expense for the years ended December 31, 2022 and 2021 was $3.9 million and $2.9 million, respectively. As of December 31, 2022 and 2021, the carrying value of the debt was $10.0 million and $7.6 million, respectively

March 2021 Purchase Agreement

On March 8, 2021, the Company entered into a purchase agreement (the “March 2021 Purchase Agreement”) with Streeterville Capital, LLC (“Streeterville”), a company affiliated with CVP, pursuant to which the Company sold a royalty interest entitling Streeterville to $10.0 million and any interest, fees, and charges as royalty repayment amount for an aggregate purchase price of $5.0 million. Interest will accrue on the royalty repayment amount at a rate

of 5% per annum, compounding quarterly, and will increase to 10% per annum, compounding quarterly on the 12-month anniversary of the closing date.

The Company will be obligated to make minimum royalty payments on a monthly basis beginning at the earlier of (a) 36 months following the closing date or (b) 30 days following the satisfaction of all existing royalties to Streeterville, and its affiliates namely Iliad and Irving, but not earlier than 18 months following the closing date in an amount equal to the greater of (i) $250,000 beginning on the royalty payment start date and continuing until either the royalty repayment amount has been paid in full or the 6-month anniversary of the royalty payment start date, $400,000 beginning on the 6-month anniversary of the royalty payment start date and continuing until either the royalty repayment amount has been paid in full or the 12-month anniversary of the royalty payment start date, $600,000 beginning on the 12-month anniversary of the royalty payment start date and continuing until either the royalty repayment amount has been paid in full or the 18-month anniversary of the royalty payment start date, $750,000 beginning on the 18-month anniversary of the royalty payment start date and continuing until the royalty repayment amount has been paid in full, and (ii) 10% of the Company’s net sales on included products, 10% of worldwide revenues related to upfront licensing fees and milestone payments from licensees and/or distributors but specifically excluding licensing fees and/or milestone payments that are reimbursements of clinical trial expenses or associated with the license of Included Products from the Company to Napo Therapeutics, including but not limited to the upfront fee payable by Napo Therapeutics to Napo for included products and Crofelemer for other indications; and 50% of royalties collected from licenses of the included products to third parties.

The Royalty Interest amount of $10.0 million is classified as debt, net of a $5.0 million discount, at initial recognition. Under ASC 470-10-35-3, royalty payments to Streeterville will be amortized under the interest method per ASC 835-30. Because there is no set interest rate, and because the royalty payments are variable, the discount rate is variable. After each royalty payment, the Company will use a prospective method to determine a new discount rate based on the revised estimate of remaining cash flows. The new rate is the discount rate that equates the present value of the revised estimate of remaining cash flows with the carrying amount of the debt, and it will be used to recognize interest expense for the remaining periods. At issuance, based on projected cash outflows from future revenue streams, the discount rate was 19.36%. As of December 31, 2022, the forecasted future revenues changed which resulted to a new discount of 19.14%.

On April 14, 2022, under the Royalty Interest Global Amendments, the Company is granted at its sole discretion, the right to exchange from time to time, all or any of the Royalty Interest under the original principal amount of $10.0 million of the March 2021 Purchase Agreement for shares of the Company’s common stock at a price per share equal to the Nasdaq Minimum Price (as defined in Nasdaq Listing Rule 5635(d)) as of date of the applicable exchange, subject to certain limitations.

On August 17, 2022, the Company entered into an exchange agreement (the “Royalty Interest Exchange Agreement”) with Streeterville to (i) partition a new royalty interest in the royalty repayment amount of $3.4 million (“Partitioned Royalty”) from the royalty interest of the March 2021 Purchase Agreement and then cause the outstanding balance of the royalty interest to be reduced by an amount equal to the initial outstanding balance of the Partitioned Royalty, and (ii) exchange (“Royalty Exchange”) the Partitioned Royalty for 153,333 million shares of the Company’s common stock with a par value of $0.0001 in accordance with the term of the Royalty Interest Exchange Agreement. Under the terms of the Royalty Interest Exchange Agreement, the Royalty Exchange will consist of Streeterville surrendering the Partitioned Royalty in exchange for the shares, free of any restrictive securities legend, and Streeterville shall give no consideration of any kind whatsoever to the Company in connection with the Royalty Interest Exchange Agreement.

On September 30, 2022, the Company entered into an exchange agreement with Streeterville, pursuant to which the parties agreed to partition $2.0 million from the outstanding balance of the royalty interest. The parties further agreed to exchange the partitioned royalty for 156,863 shares of the Company’s common stock. The exchange consisted of Streeterville surrendering the partitioned royalty in exchange for the exchange shares. The exchange was accounted for as a debt modification and resulted to a reduction in the outstanding balance of the royalty interest amounting to $2.0 million. As of December 31, 2022 the forecasted future revenues changed which resulted to a new discount of 53.85%.

Interest expense for the years ended December 31, 2022 and 2021 was $1.9 million and $1.2 million, respectively. As of December 31, 2022 and 2021, the carrying value of the debt was $3.1 million and $5.8 million, respectively.

August 2022 Purchase Agreement

On August 24, 2022, the Company entered into another royalty interest purchase agreement (the “August 2022 Purchase Agreement”) with Streeterville, pursuant to which the Company sold to Streeterville (the entitling “Investor”) a royalty interest to receive $12.0 million of future royalties on sales of Mytesi® (crofelemer) for any indications that could cannibalize crofelemer indications or any other chronic indication and certain up-front license fees and milestone payments from licensees and/or distributors for an aggregate purchase price of $4.0 million (“the Royalty Financing”). The Company will use the proceeds to support the ongoing pivotal phase 3 clinical trial of crofelemer for prophylaxis of diarrhea in adults receiving targeted cancer therapy. Interest will accrue on the Royalty Repayment Amount at a rate of 5% per annum from the closing of the Royalty Financing until the one-year anniversary of such closing and 10% per annum thereafter, simple interest computed on the basis of a 360-day year comprised of twelve 30-day months.

The Company will be obligated to make minimum royalty payments on a monthly basis beginning on January 1, 2024 in an amount equal to the greater of (A) $250,000 (which increases to $400,000 beginning 6 months following the closing of the Royalty Financing, $600,000 beginning 12 months following the closing of the Royalty Financing, and $750,000 beginning 18 months following the closing of the Royalty Financing) and (B) the royalty payments to which Investor is entitled, consisting of (1) 10% of the Company’s net sales of crofelemer for any indications that could cannibalize crofelemer indications or any other chronic indication (including any improvements, modifications and follow-on products, collectively referred to as “Included Products”) (2) 10% of worldwide revenues related to upfront licensing fees and milestone payments from licensees and/or distributors, but specifically excluding licensing fees and/or milestone payments that are (A) reimbursements of clinical trial expenses or (B) associated with the license of the of the Included Products from the Company to Napo EU S.p.A. and (3) 50% of royalties collected from licenses of the Included Products to third parties.

Pursuant to the terms of the Royalty Interest, the Company has the right to exchange from time to time at the Company’s sole discretion all or any portion of the Royalty Interest for shares of Common Stock at a price per share equal to the Nasdaq Minimum Price (as defined in Nasdaq Listing Rule 5635(d)) as of the date of the applicable exchange. At issuance, based on projected cash outflows from future revenue streams, the discount rate was 55.97%.

Interest expense for the year ended December 31, 2022 was $1.1 million. As of December 31, 2022, the carrying value of the debt is $4.8 million.

Streeterville Note

On January 13, 2021, the Company issued a secured promissory note to Streeterville in the original principal amount of $6.2 million for an aggregate purchase price of $6.0 million. The Company will use the proceeds to fund development of the Company’s NP-300 drug product candidate for the indication of the symptomatic relief of diarrhea from cholera and general corporate purposes, including the Company’s product pipeline activities. The note is due after four years and bears interest at 3.25% per annum. Interest on the note is payable annually in advance by adding the interest charge for each upcoming year to the outstanding balance on the date each such interest charge is accrued. The Company also paid $25,000 to cover legal fees, accounting costs, due diligence, monitoring and other transaction costs incurred in connection with the issuance of the note. The first year of prepaid interest and the transaction expenses are included in the original principal amount.

At any time following the occurrence of a trial failure which refers to any of the following: (i) the Company abandons the clinical trial with NP-300 for an indication for the symptomatic relief of infectious diarrhea for cholera; (ii) the Company fails to start the Phase 1 clinical trial of NP-300 for the symptomatic relief of infectious diarrhea for cholera by July 1, 2022; or (iii) the Company fails to meet all primary endpoints in the pivotal trials of NP-300 for the

symptomatic relief if infectious diarrhea for cholera with statistical significance, Streeterville may elect to increase the outstanding balance as of the date of the trial failure by 25% without acceleration (the “Trial Failure Effect”). If Streeterville elects to apply the Trial Failure Effect, it reserves the right to declare the outstanding balance immediately due and payable at any time. As of December 31, 2022, no trial failure occurred.

Streeterville is entitled to a maximum of 18% and a minimum of 1% of the gross proceeds received by the Company from the sale of TDPRV (the “Return Bonus”). The Return Bonus percentage is reduced pro rata based on the percentage of the original principal balance of the note that has been repaid as of the date of the sale of the TDPRV. Even if the note has been paid in full at the time of the sale of the TDPRV, the Company is still obliged to pay Streeterville a Return Bonus of 1%. If Streeterville applies the Trial Failure Effect, the Return Bonus will automatically be reduced to 1%. If the TDPRV has not been sold as of the day immediately preceding the maturity date of the note, the Return Bonus percentage will be fixed as of such date. As of December 31, 2022, the Company has not sold any TDPRV.

Beginning on the earlier of (a) 6 months after January 2021, and (b) initiation of human trials with NP-300 for symptomatic relief of infectious diarrhea for cholera, the Company may pay all or any portion of the outstanding balance earlier than it is due. In the event the Company elects to prepay all or any portion of the outstanding balance, it shall pay to Streeterville 112.5% of the portion of the outstanding balance the Company elects to prepay. The Company may not prepay the note without the Streeterville’s consent on the date the last patient is enrolled in a pivotal trial.

After Streeterville becomes aware of the occurrence of any default, Streeterville may accelerate the note, with the outstanding balance becoming immediately due and payable in cash at the Mandatory Default Amount (i.e., the outstanding balance following the application of the Default Effect). Streeterville reserves the right to declare the outstanding balance immediately due and payable at any time following the default. Default Effect means multiplying the outstanding balance as of the date of default by 5% or 15% for each occurrence of default, capped at an aggregate of 25%, and then adding the resulting product to the outstanding balance. The percentage to be used depends on whether the default is viewed as minor or major as defined in the agreement. Furthermore, interest accrues on the outstanding balance beginning on the date of default at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. As of December 31, 2022, no default has occurred.

In connection with the note issuance, the Company has entered into a security agreement with Streeterville, pursuant to which Streeterville will receive a first priority security interest in all existing and future NP-300 technology, and any TDPRV and the sale proceeds therefrom that may be granted to the Company by the FDA in connection with the development of NP-300 for the cholera-related indication. The Company also agreed, with certain exceptions, not to grant any lien on any of the collateral securing the note and not to grant any license under any of the intellectual property relating to such collateral. The grant of security interest has become effective upon the receipt of the Salix Waiver on April 6, 2021 in observance to the requirement of the settlement agreement previously entered by the Company with Salix Pharmaceuticals, Inc.

The Company irrevocably elected to initially and subsequently apply the FVO accounting to the entire note. The fair value at transaction date was equal to the cash proceeds received of $6.0 million. The transaction expense of $25,000 was recognized in profit and loss as incurred. The Company used the valuation report from an independent valuation service provided to measure the reporting date fair value of the note. At December 31, 2022 and 2021, the fair value was determined to be $7.8 million. For the year ended December 31, 2022, the net increase in the fair value of $20,000 was recorded as loss included in the change in fair value of financial instruments and hybrid instrument designated at FVO in the consolidated statements of operations.

Insurance Financing

March 2021 First Insurance Financing

In March 2021, the Company entered into a premium finance agreement for $98,000 with First Insurance Funding (“First Insurance”) representing the unpaid balance of the total premiums, taxes, and fees of $115,000 with an annual interest rate of 4.6%. The total finance charge was $2,000. Payment of principal and interest is due in equal monthly installments over ten months. The Company granted and assigned First Insurance a first priority lien on and security interest in the financed policies and any additional premium required under the financed policies. Interest expense for the year ended December 31, 2022 was $2,000. The financing balance was zero and $10,000 at December 31, 2022 and 2021.

May 2021 First Insurance Financing

In May 2021, the Company entered into another premium finance agreement for $1.1 million with First Insurance representing the unpaid balance of the total premiums, taxes, and fees of $1.4 million with an annual interest rate of 4.15%. The total finance charge was $21,000. Payment of principal and interest is due in equal monthly installments over ten months. Interest expense for the years ended December 31, 2022 and 2021 was $6,000 and $13,000, respectively. The financing balance was zero and $326,000 at December 31, 2022 and 2021, respectively.

March 2022 First Insurance Financing

In March 2022, the Company entered into another premium finance agreement for $100,000 with First Insurance representing the unpaid balance of the total premiums, taxes, and fees of $115,000 with an annual interest rate of 4.6%. The total finance charge was $15,000. Payment of principal and interest is due in equal monthly installments over ten months. Interest expense for the year ended December 31, 2022 was zero. The financing balance was $9,000 at December 31, 2022.

May 2022 First Insurance Financing

In May 2022, the Company entered into another premium finance agreement for $752,000 with First Insurance representing the unpaid balance of the total premiums, taxes, and fees of $941,000 with an annual interest rate of 4.3%. The total finance charge was $15,000. Payment of principal and interest is due in equal monthly installments over ten months. Interest expense for the year ended December 31, 2022 was $4,000. The financing balance was $226,000 at December 31, 2022.

2019 Tempesta Note

In October 2019, the Company entered into a License Termination and Settlement Agreement with Dr. Michael Tempesta, pursuant to which certain royalty payment disputes between Napo and Tempesta were settled. Per the terms of the Agreement, Tempesta received $50,000 in cash, an unsecured promissory note issued by the Company in the aggregate principal amount of $550,000 and 178 shares of the Company’s common stock in exchange for the cessation of all royalty payments by Napo to Dr. Tempesta under the License Agreements. The $550,000 promissory note bears interest at the rate of 2.5% per annum and matures on March 1, 2025. The promissory note provides for the Company to make semiannual payments equal to $50,000 plus accrued interest beginning on March 1, 2020 until the Note is paid in full. Interest expense for the years ended December 31, 2022 and 2021 was $10,000 and $10,000, respectively. At December 31, 2022 and 2021, the net carrying value of the Tempesta note was $250,000 and $350,000 respectively.

Oasis Secured Borrowing

The Purchase Agreement

In May 2020, the Company, entered into a one-year Accounts Receivable Purchase Agreement (the “Purchase Agreement”) with Oasis Capital (“Oasis”).

In December 2020, the Company received cash proceeds of $1.6 million from Oasis (the “Tranche #6 Secured Note”). Oasis purchased accounts receivable with a carrying value of $2.2 million, or gross accounts receivable of $3.8 million net of chargebacks and discounts of $1.6 million.

In February 2021, the Company made its final required payment to Oasis under Tranche #6 Secured Note, with total payments equaling the $1.8 million Threshold amount plus the transaction fee, and the Tranche #6 Secured Note was extinguished.

Exchange Note 2

In May 2019, CVP and the Company agreed to exchange two Napo convertible notes for a single CVP Note (“Exchange Note 1”). Per agreement, in consideration of the extension of the maturity date of Exchange Note 1 from December 31, 2019 to December 31, 2021, the Company issued a note (“Exchange Note 2”) with a principal balance of $2.3 million. As of December 31, 2021, the carrying value of Exchange Note 1 was zero.

In September 2020, the Company and CVP also entered into a global amendment agreement, pursuant to which the maturity date of Exchange Note 2 is extended to December 31, 2022. In consideration of CVP’s grant of extension, together with the related fees and other accommodation set forth, principal debt was increased by 5% of the outstanding balance of Exchange Note 2, which was $2.6 million as of the global amendment date. The global amendment requires redemption of Series D Perpetual Preferred Stock prior to payment of principal of Exchange Note 2. The global amendment agreement was accounted for as modification.

Pursuant to the global amendment agreement, the Company issued 842,500 shares of Series D Perpetual Preferred Stock. The Series D Perpetual Preferred shares were redeemable upon the option or discretion of the Company. The Series D Perpetual Preferred stockholders were entitled to receive 8% cumulative stock dividends, to be payable in arrears on a monthly basis for 24 consecutive months. Dividends payable on the Series D perpetual preferred shares shall be payable through the Company’s issuance of Series D Perpetual Preferred share by delivering to each record holder the calculated number of payment-in-kind (“PIK”) dividend shares. The Series D Perpetual Preferred shares were classified as liability and were measured at fair value using the income approach, which considered the weighted probability of discounted cash flows at various scenarios of redemption and perpetual holding of the shares. The Company determined the fair value of $6.4 million at contract inception date with the assistance of an independent valuation service provider to be based on discounted cash flows representing the settlement value of the shares and cumulative dividends issued using an effective borrowing rate of 12% to 15% adjusted for counterparty and a maturity date of September 30, 2021. In consideration of the global amendment agreement, no principal payment shall be made to the Exchange Note 2 until the redemption of Series D Perpetual Preferred shares. Due to the restrictive nature of the timing of cash outflows in response to the settlement of the Exchange Note 2, Series D Perpetual Preferred shares were implicitly deemed to be mandatorily redeemable upon the ultimate settlement of the outstanding balance of Exchange Note 2. The shares were redeemable at $8.00 per share on or before December 31, 2024, the date in which contractual cash outflows of the Exchange Note 2 require the entire settlement or redemption of the Series D Perpetual Preferred shares. In December 2020, the Company entered into a series of exchange agreements with a stockholder pursuant to which the Company agreed to issue a total of 70,622 shares of common stock in exchange for redeeming 859,348 shares of Series D Perpetual Preferred Stock. The series of exchanges was accounted for as an extinguishment which resulted to a loss amounting to $1.3 million. This is included in loss on extinguishment of debt and conversion of Series D Perpetual Preferred Stock on the statement of operations as of December 31, 2021. As of December 31, 2022 and 2021, there were no Series D Perpetual Preferred shares outstanding.

In December 2020, the Company and CVP entered into a note exchange agreement to which the Company made a prepayment of principal amounting to $1.0 million, in lieu of making cash payments to CVP on Exchange Note 2, by issuing 5,556 shares of the Company’s common stock to CVP on December 31, 2021. The exchange agreement was accounted for as a modification.

In January 2021, the Company and CVP entered into another note exchange agreement to which the Company made a prepayment of the remaining outstanding balance of Exchange Note 2 amounting to $1.8 million, in lieu of making cash payments to CVP by issuing 6,283 shares of the Company’s common stock to CVP on January 4, 2021. The exchange was accounted for as debt extinguishment which resulted in a loss of $753,000.

- 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

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+ Details

Stock-Based Compensation - Summary of Stock Incentive Plans (Details) - USD ($) $ / shares in Units, $ in Thousands			1 Months Ended	12 Months Ended
	Jun. 16, 2020	May 12, 2015	Nov. 30, 2013	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020	Apr. 13, 2022	Apr. 12, 2022
Stock-Based Compensation
Incentive stock option term		10 years
Option outstanding				26,533	31,221
Options available for grant under stock option plans				122,978	8,417
Common stock reserved for issuance				203,427	55,715
Shares Available for Grant
Beginning balance (in shares)				8,417
Ending balance (in shares)				122,978	8,417
Stock Options Outstanding
Beginning balance (in shares)				31,221
Ending balance (in shares)				26,533	31,221
RSUs Outstanding
Beginning balance (in shares)				6,499
Ending balance (in shares)				44,865	6,499
Options vested, exercisable and expected to vest
Weighted average grant date fair value of stock options granted (in dollars per share)				$ 22.04	$ 379.66
Number of options vested (in shares)				7,492	9,280
Weighted average fair value of options vested on grant date				$ 304.57	$ 336.60
Stock options
Stock-Based Compensation
Option outstanding				28,079	33,286	20,229
Stock Options Outstanding
Beginning balance (in shares)				33,286	20,229
Options granted (in shares)				44	13,547
Options exercised (in shares)				0	(42)
Options cancelled (in shares)				(5,251)	(448)
Ending balance (in shares)				28,079	33,286	20,229
Weighted Average Stock Option Exercise Price
Beginning balance (in dollars per share)				$ 707.97	$ 950.90
Options granted (in dollars per share)				23.46	405.45
Options exercised (in dollars per share)					100.35
Options cancelled (in dollars per share)				418.34	2,285.32
Ending balance (in dollars per share)				$ 592.73	$ 707.97	$ 950.90
Weighted Average Remaining Contractual Life (Years)
Weighted Average Remaining Contractual Life (Years)				7 years 2 months 8 days	8 years 4 months 6 days	8 years 8 months 15 days
Options vested, exercisable and expected to vest
Options vested and exercisable (in shares)				26,102
Options vested and exercisable (in dollars per share)				$ 614.51
Options vested and exercisable (in years)				7 years 1 month 9 days
Options vested and expected to vest (in shares)				27,901
Options vested and expected to vest (in dollars per share)				$ 594.38
Options vested and expected to vest (in years)				7 years 2 months 4 days
Aggregate Intrinsic Value ,outstanding					$ 3	$ 364
Options exercised (in shares)				0	42
Stock options and RSUs
Stock-Based Compensation
Options available for grant under stock option plans				122,978	8,417	2,652
Shares Available for Grant
Beginning balance (in shares)				8,417	2,652
Additional shares authorized (in shares)				151,079	25,358
Options granted (in shares)				(44)	(13,547)
Options cancelled (in shares)				5,251	448
Ending balance (in shares)				122,978	8,417	2,652
RSUs Outstanding
RSUs Granted (in shares)				41,725	6,494
Restricted stock units issued and outstanding
Shares Available for Grant
RSUs vested and released (in shares)				(2,516)
RSUs Outstanding
Beginning balance (in shares)				6,499	5
RSUs Granted (in shares)				41,725	6,494
RSUs vested and released (in shares)				(2,516)
RSUs Cancelled (in shares)				(843)
Ending balance (in shares)				44,865	6,499	5
2013 Plan
Stock-Based Compensation
Option shares outstanding				2	2
2013 Plan \| Stock options
Stock Options Outstanding
Options granted (in shares)			0
2014 Plan
Stock-Based Compensation
Option outstanding				26,533	31,740
Options available for grant under stock option plans				116,011	8,260
Common stock reserved for issuance							2,417,660
Shares Available for Grant
Beginning balance (in shares)				8,260
Ending balance (in shares)				116,011	8,260
Stock Options Outstanding
Beginning balance (in shares)				31,740
Ending balance (in shares)				26,533	31,740
2014 Plan \| Stock options
Stock-Based Compensation
Increase in share reserve based on outstanding number of shares (as a percent)		2.00%
2020 New Employee Inducement Award Plan
Stock-Based Compensation
Incentive stock option term	10 years
Option outstanding				1,546	1,546
Options available for grant under stock option plans	2,222			6,967	157
Shares Available for Grant
Beginning balance (in shares)				157
Additional shares authorized (in shares)				151,079
Ending balance (in shares)	2,222			6,967	157
Stock Options Outstanding
Beginning balance (in shares)				1,546
Ending balance (in shares)				1,546	1,546
Inducement Award Plan
Stock-Based Compensation
Common stock reserved for issuance							471,833
Number of shares reserved for issuance							971,833	500,000
Common Stock
Options vested, exercisable and expected to vest
Share Price				$ 6.52
Participants Voting Power More than Ten Percent \| 2014 Plan
Stock-Based Compensation
Incentive stock option term		5 years
Participants Voting Power More than Ten Percent \| 2020 New Employee Inducement Award Plan
Stock-Based Compensation
Incentive stock option term	5 years

Commitments and Contingencies

12 Months Ended

Dec. 31, 2022

Commitments and Contingencies

Commitments and Contingencies

5. Commitments and Contingencies

Commitments

Leases

August 31, 2020, the Company entered into an office sublease of approximately 5,263 square feet of office space in San Francisco. The term of the sublease expired on May 31, 2021. The rent sublease is $15,000 per month beginning on October 1, 2020, which includes operating expenses and taxes. The Company recognizes rent expense on a straight-line basis over the non-cancellable lease period. Rent expense, included in general and administrative expenses in the consolidated statements of operations, was zero and $75,000 for the years ended December 31, 2022 and 2021, respectively. As of December 31, 2022, there were no remaining commitment under the lease.

On April 6, 2021, the Company entered into an office lease agreement of approximately 10,526 square feet of office space in San Francisco, inclusive of office space covered under the previous sublease agreement. The term of the lease began on September 1, 2021 and will expire on February 28, 2025, unless terminated earlier. The lease had an early occupancy provision which entitled the Company to use a portion of the leased premises on June 1, 2021, free of rent obligation. In addition, the Company has the option to extend the lease for one three-year period after the expiration date. This option was not included as part of the lease term as the Company was not reasonably certain to exercise it, hence the lease term only includes the noncancellable period of three years plus the period of early occupancy.

The base rent under the lease were $42,000 monthly for the first 12 months, $43,000 monthly for the next 12 months and $45,000 for the last twelve months. The lease agreement only contained one lease component, that is, the lease of the office space. Non-lease components such as payment of building operating costs and share in real property taxes were accounted for separately and were not considered as part of the total lease payments. The lease was classified as an operating lease.

On October 7, 2021, the Company entered into an agreement for the lease of office premises from November 1, 2021 to April 30, 2022, subject to automatic renewal for subsequent periods until terminated by either party. Base rent amounted to €10,000 or approximately $10,500. If the contract is not terminated within 12 months, the lease amount will be increased in line with the index of relevant inflation at each annual expiration of the start date of the contract. The lessor has the right to decline the renewal of the contract. Upon the happening of certain specified events, the lessor may immediately withdraw from the contract. The Company is required leave the occupied spaces immediately in the same condition in which they were found in the event of contract termination or expiry. The Company paid deposit of €20,000 or approximately $21,000 to the lessor. On January 26, 2022, the lease agreement was amended whereby the term was extended by 20 months from May 1, 2022 to December 31, 2023. All other contract provisions remained the same.

On October 10, 2021, the Company also entered into a short-term office lease in Milan, Italy. The term of the lease began on November 1, 2021, subject to automatic renewal equal to the present term until terminated by mutual agreement. On January 26, 2022, the lease agreement was amended whereby the term was extended by 20 months from May 1, 2022 to December 31, 2023. The Company recognizes rent expense on a straight-line basis over the non-cancellable lease period.

On December 22, 2021, the Company entered into an agreement for the lease of two separate vehicles for 48 months expiring on November 30, 2025. Total monthly lease payment amounted to €2,000 or approximately $2,100 payable in advance. The Company elected to include both the lease and non-lease components as a single component and account for it as a lease. The Company also paid a total deposit of €19,000 or approximately $20,000, exclusive of VAT. Early termination of the contracts requires the payment of specified amounts.

On December 24, 2021, the Company entered into the first amendment of the lease of office space in San Francisco. The expiration of the lease was extended to February 28, 2025 due to the change in the commencement date of one of the leased premises to March 1, 2022. The base rent under the lease amendment remained the same but will only be due starting March 1, 2022. The rent in one of the leased premises currently being occupied by the Company was and will still be $21,000 until the new commencement date. The lease amendment constituted a lease modification where the Company remeasured the original lease liability using a discount rate determined at the effective date of the modification and the amount of remeasurement of the lease liability was recognized as an adjustment to the corresponding right-of-use asset without affecting profit or loss.

On January 25, 2022, the Company entered into an agreement for the lease of office premises from March 1, 2022 to December 31, 2023, subject to automatic renewal for subsequent periods until terminated by either party. Base rent amounted to €4,000 or approximately $4,200. A similar agreement was entered with the lessor for the lease of premises to be used as office space from November 1, 2022 to December 31, 2023, subject to automatic renewal for subsequent periods until terminated by either party. Base rent amounted to €3,817 or approximately $4,000. If the contracts are not terminated within 12 months, the lease amounts will be increased in line with the index of relevant inflation at each annual expiration of the start date of the contract. The lessor has the right to decline the renewal of the contracts. Upon the happening of certain specified events, the lessor may immediately withdraw from the contracts. The Company is required leave the occupied spaces immediately in the same conditions in which they were found in the event of contract termination or expiry. The Company paid a deposit of €9,000 or approximately $9,500 to the Lessor.

In May 2022, the Company entered into an agreement for the lease of one vehicle for 48 months expiring on April 30, 2026. Total monthly lease payment amounted to €833 or approximately $880 payable in advance. The Company elected to include both the lease and non-lease components as a single component and account for it as a lease. The Company also paid a total deposit of €21,000 or approximately $22,000, exclusive of VAT. Early termination of the contracts requires the payment of specified amounts.

In October 2022, the Company entered into an agreement for the lease of three vehicles for 48 months expiring on September 30, 2026. Total monthly lease payment amounted to €2,094 or approximately $2,200 payable in advance. The Company elected to include both the lease and non-lease components as a single component and account for it as a lease.

In November 2022, the Company entered into an agreement for the lease of two vehicles for 48 months expiring on October 31, 2026. Total monthly lease payment amounted to €1,459 or approximately $1,500 payable in advance. The Company elected to include both the lease and non-lease components as a single component and account for it as a lease.

The table below provided additional details of the office space lease presented in the consolidated balance sheet:


	December 31,
	2022		2021
(in thousands)
Operating lease - right-of-use asset	$	1,140	$	1,084

Operating lease liability, current		483		240
Operating lease liability, net of current portion		725		919
Total	$	1,208	$	1,159

Weighted-average remaining life (years)		2.36		3.21
Weighted-average discount rate		17.89%		21.10%

Lease cost included in general and administrative expenses in the consolidated statements of operations for the years ended December 31, 2022 and 2021 was approximately $629,000 and $282,000.

For the years ended December 31, 2022 and 2021, cash paid for operating lease liabilities recognized under operating cash flows amounted to $315,000 and $105,260, respectively. Non-cash investing and financing activities for the years ended December 31, 2022 and 2021 include addition to right-of-use asset obtained from new operating liabilities amounting to $365,000 and $1.1 million, respectively, and lease modification amounting to zero and $91,000 respectively.

The following table summarizes the undiscounted cash payment obligations for the operating lease liability:


	December 31,
	2022
(in thousands)
2023		642
2024		605
2025		160
2026		32
Total undiscounted operating lease payments		1,439
Imputed interest expenses		(231)
Total operating lease liability		1,208
Less: Operating lease liability, current		483
Operating lease liability, net of current portion	$	725

Rent and lease expense included in the general and administrative expenses in the audited consolidated statements of operations for the year ended December 31, 2022 and December 31, 2021 was approximately $629,000 and $282,000, respectively.

Purchase Commitment

On September 3, 2020, the Company entered into a manufacturing and supply agreement (the “Agreement”) with Glenmark Life Sciences Limited (“Glenmark”), pursuant to which Glenmark will continue to serve as the Company’s manufacturer of crofelemer for use in Mytesi, the Company’s human prescription drug product approved by the U.S. Food and Drug Administration, and for other crofelemer-based products manufactured by the Company or its affiliates for human or animal use. The term of the Agreement is approximately 2.5 years (i.e., until March 31, 2023) and may be extended for successive two-year renewal terms upon mutual agreement between the parties

thereto. Pursuant to the terms of the Agreement, Glenmark will supply crofelemer to the Company. The Agreement contains provisions regarding the rights and responsibilities of the parties with respect to manufacturing specifications, forecasting and ordering, delivery arrangements, payment terms, confidentiality and indemnification, as well as other customary provisions. The Agreement includes a commitment for the purchase from Glenmark of a minimum quantity of 500 kilograms of crofelemer per year, pro-rated for partial years, where the Company may be obligated to pay any shortfall. Either party may terminate the Agreement for any reason with 12 months prior written notice to the other party. In addition, either party may terminate the Agreement upon written notice as a result of a material breach of the Agreement that remains uncured for a period of 90 days. If the Company terminates the Agreement as a result of a material breach caused by Glenmark, the Company will not be obligated to pay for any minimum quantity shortfall. As of December 31, 2022, the remaining commitment is 125 kilograms.

Master Services Agreement (“MSA”)

On October 5, 2020, the Company entered into another MSA for clinical research organization services (the “2020 MSA”) and a service order under such 2020 MSA with Integrium. The service order covers the Company’s planned upcoming pivotal Phase 3 clinical trial for cancer-therapy related diarrhea. As consideration for its services, the Company will pay Integrium a total amount of up to approximately $12.4 million that will be paid over the term of the engagement and based on the achievement of certain milestones. The 2020 MSA will terminate upon the satisfactory performance of all services to be provided thereunder unless earlier terminated by the parties. For the years ended December 31, 2022 and 2021, the Company paid Integrium $1.9 million and $1.7 million, respectively.

Asset Transfer and Transition Commitment

On September 25, 2017, Napo entered into the Termination, Asset Transfer and Transition Agreement dated September 22, 2017 with Glenmark. As a result of the agreement, Napo now controls commercial rights for Mytesi for all indications, territories and patient populations globally, and also holds commercial rights to the existing regulatory approvals for crofelemer in Brazil, Ecuador, Zimbabwe and Botswana. In exchange, Napo agrees to pay Glenmark 25% of any payment it receives from a third party to whom Napo grants a license or sublicense or with whom Napo partners in respect of, or sells or otherwise transfers any of the transferred assets, subject to certain exclusions, until Glenmark has received a total of $7.0 million. For the years ended December 31, 2022 and 2021, the Company paid Glenmark $2.6 million and $2.0 million, respectively.

Revenue Sharing Commitment Update

On December 14, 2017, the Company announced its entry into a collaboration agreement with Seed Mena Businessmen Services LLC (“SEED”) for Equilevia™, the Company's non-prescription, personalized, premium product for total gut health in equine athletes. According to the terms of the Agreement, the Company will pay SEED 15% of total revenue generated from any clients or partners introduced to the Company by SEED in the form of fees, commissions, payments or revenue received by the Company or its business associates or partners, and the agreed-upon revenue percentage increases to 20% after the first million dollars of revenue. In return, SEED will provide the Company access to its existing United Arab Emirates (“UAE”) network and contacts and assist the Company with any legal or financial requirements. The agreement became effective on December 13, 2017 and will continue indefinitely until terminated by either party pursuant to the terms of the Agreement. No payments have been made to date.

Contingencies

From time to time, the Company maybe a party to various legal actions, both inside and outside the U.S., arising in the ordinary course of its business or otherwise. The Company accrues amounts, to the extent they can be reasonably estimated, that the Company believes will result in a probable loss (including, among other things, probable settlement value), to adequately address any liabilities related to legal proceedings and other loss contingencies. A loss or a range of loss is disclosed when it is reasonably possible that a material loss will incur and can be estimated, or when it is reasonably possible that the amount of a loss, when material, will exceed the recorded provision. The Company did not have any material accruals for any currently active legal action in its consolidated

balance sheets as of December 31, 2022, as the Company could not predict the ultimate outcome of these matters, or reasonably estimate the potential exposure.

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2022

Total net revenue

Schedule of concentration risk


	Year Ended
	December 31,
	2022		2021
Customer 1	—	%	73	%
Customer 2	35	%	11	%
Customer 3	53	%	12	%

Total accounts receivable

Schedule of concentration risk



	December 31,
	2022		2021
Customer 1	—	%	16	%
Customer 2	38	%	37	%
Customer 3	54	%	37	%

Segment Data (Details) $ in Thousands	12 Months Ended
Segment Data (Details) $ in Thousands	Dec. 31, 2022 USD ($) segment	Dec. 31, 2021 USD ($)
Segment Information
Number of reportable segments \| segment	2
Revenue from external customers	$ 11,956	$ 4,335
Net loss	(48,395)	(52,600)
Segment assets	47,452	53,265
Less: investment in subsidiary	(29,232)	(29,232)
Less: Intercompany loan	(92,821)	(75,333)
Human Health
Segment Information
Net loss	(18,278)	(24,276)
Segment assets	40,898	42,250
Animal Health
Segment Information
Net loss	(30,117)	(28,324)
Segment assets	128,607	115,580
Product revenue
Segment Information
Revenue from external customers	11,956	4,335
Product revenue \| Human Health
Segment Information
Revenue from external customers	11,741	4,273
Product revenue \| Animal Health
Segment Information
Revenue from external customers	215	62
Operating Segments
Segment Information
Segment assets	$ 169,505	$ 157,830

Warrants (Tables)

12 Months Ended

Dec. 31, 2022

Warrants

Summary of warrant activity


	December 31,
	2022	2021
Warrants outstanding, beginning balance	7,513	32,024
Issuances	—	2,250
Exercises	—	(26,761)
Expirations and cancelations	(8)	—
Warrants outstanding, ending balance	7,505	7,513

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2022

Stock-Based Compensation

Summary of incentive plan activity


				Weighted		Weighted Average
	Shares	Stock		Average		Remaining	Aggregate
	Available	Options	RSUs	Stock Option		Contractual Life	Intrinsic
(in thousands, except share and per share data)	for Grant	Outstanding	Outstanding	Exercise Price		(Years)	Value*
Outstanding at January 1, 2021	2,652	20,229	5	$	950.90	8.71	$	364
Additional shares authorized	25,358	—	—		—			—
Options granted	(13,547)	13,547	—		405.45			—
Options exercised	—	(42)	—		100.35			—
Options canceled	448	(448)	—		2,285.32			—
RSUs granted	(6,494)	—	6,494		—			—
RSUs vested and released	—	—	—		—			—
RSUs cancelled	—	—	—		—			—
Outstanding at December 31, 2021	8,417	33,286	6,499	$	707.97	8.35	$	3
Additional shares authorized	151,079	—	—		—			—
Options granted	(44)	44	—		23.46			—
Options exercised	—	—	—		—			—
Options canceled	5,251	(5,251)	—		418.34			—
RSUs granted	(41,725)	—	41,725		—			—
RSUs vested and released	—	—	(2,516)		—			—
RSUs cancelled	—	—	(843)		—			—
Outstanding at December 31, 2022	122,978	28,079	44,865	$	592.73	7.19	$	—
Exercisable at December 31, 2022		26,102		$	614.51	7.11	$	—
Vested and expected to vest at December 31, 2022		27,901		$	594.38	7.18	$	—

*Fair market value of Jaguar stock on December 31, 2022 was $6.52 per share.

Summary of stock-based compensation expense


	Year Ended
	December 31,
(in thousands)	2022		2021
Research and development expense	$	1,263	$	1,319
Sales and marketing expense		267		319
General and administrative expense		1,788		2,336
Total	$	3,318	$	3,974

Employee stock options

Stock-Based Compensation

Schedule of estimated grant-date fair value of stock options calculated using the Black-Scholes option-pricing model


	Year Ended
	December 31,
	2022	2021
Volatility	164.0%	163.8 - 164.0 %
Expected term (years)	5.0	5.0
Risk-free interest rate	3.2%	0.5 - 1.2 %
Expected dividend yield	—	—

Fair Value Measurements

12 Months Ended

Dec. 31, 2022

Fair Value Measurements

Fair Value Measurements

3. Fair Value Measurements

ASC 820 "Fair Value Measurements," defines fair value, establishes a framework for measuring fair value under U.S. GAAP and enhances disclosures about fair value measurements. Fair value is defined under ASC 820 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 on the measurement date. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a 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 which are the following:

●

Level 1 – Observable inputs such as quoted prices (unadjusted) for identical instruments in active markets.

●

Level 2 – Observable inputs such as quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, or model‑derived valuations whose significant inputs are observable.

●

Level 3 – Unobservable inputs that reflect the reporting entity’s own assumptions.

The following tables set forth the fair value of the Company’s consolidated financial instruments that were measured at fair value on a recurring basis as of December 31, 2022 and 2021:


	December 31, 2022
(in thousands)	Level 1		Level 2		Level 3		Total
Warrant liability	$	—	$	—	$	—	$	—
Streeterville note		—		—		7,839		7,839
Total fair value	$	—	$	—	$	7,839	$	7,839


	December 31, 2021
(in thousands)	Level 1		Level 2		Level 3		Total
Warrant liability	$	—	$	—	$	1	$	1
Streeterville note	$	—	$	—	$	7,818	$	7,818
Total fair value	$	—	$	—	$	7,819	$	7,819

The change in the estimated fair value of the Level 3 liability is summarized below:


	Year Ended
	December 31, 2022
(in thousands)	Warrant liability		Streeterville note
Beginning fair value of Level 3 liability	$	1	$	7,818
Additions		—		—
Exercises		—		—
Change in fair value		(1)		21
Ending fair value of Level 3 liability	$	—	$	7,839

Warrant Liability

The warrants associated with the Level 3 warrant liability were valued at zero and $1,000, respectively, in the Company’s audited consolidated balance sheet. Warrants as at December 31, 2022 and 2021 were computed using the Black-Scholes-Merton pricing model.

Streeterville Note

The fair value of the Streeterville Note at January 13, 2021, date of issuance and as of December 31, 2022 and 2021 amounting to $6.0 million and $7.8 million, respectively, were based on the weighted average discounted expected future cash flows representing the terms of the note, discounting them to their present value equivalents. This was classified as Level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including the Company’s own credit risk.

The Company determined and performed the valuations of the Streeterville Note with the assistance of an independent valuation service provider. On a quarterly basis, the Company considers the main Level 3 inputs used as follows:

●

Discount rate for the Streeterville note was determined using a comparison of various effective yields on bonds as of the valuation date.

●

Market indications for vouchers, which affect the Return Bonus from the sale of Tropical Disease Priority Review Voucher (“TDPRV”).

●

Weighted probability of cash outflows was estimated based on the entity's knowledge of the business and how the current economic environment is likely to impact the timing of the cash outflows, attributed to the different repayment features of the note.

The following table summarizes the quantitative information about the significant unobservable inputs used in Level 3 fair value measurement:


	Range of Inputs
	(probability-weighted average)		Relationship of unobservable inputs
Unobservable Inputs	2022	2021	to fair value
Risk Adjusted Discount Rate	11.53%-26.06% (26.06%)	6.78% - 21.31% (21.31%)	If discount rate is adjusted to total of additional 100 basis points (bps), fair value would have decreased by $364,000. If discount rate is adjusted to total deduction of 100 bps, fair value would have increased by $364,000.
Sales Proceeds: Amount of comparable TDPRV	$67.5 million to $350 million ($100 million)	$67.5 million to $350.0 million ($100.0 million)	If expected cash flows by Management considered the lowest amount of market indications for vouchers, FV would have decreased by $940,000. If expected cash flows by Management considered the highest amount of market indications for vouchers, FV would have increased by $7.23 million.
Range of Probability for Timing of Cash Flows: Variations of the terms and conditions of the timing of cash flows, including settlement of the note principal, interest, penalties, and acceleration clause.	0.39%-46.55%	0.35%-46.06%	If expected cash flows by Management considered the Scenario with the least amount of indicated value, FV would have decreased by $692,000. If expected cash flows by Management considered the scenario with the greatest amount of indicated value, FV would have increased by $1.51 million.

Fair Value Option

Beginning January 1, 2021, the Company elected to apply the FVO accounting to selected financial instruments to align the measurement attributes of those instruments under U.S. GAAP and to simplify the accounting model applied to those financial instruments. The Company elected to apply FVO accounting to the entire class of hybrid instruments, including structured notes, of which there are assessed embedded derivatives that would be eligible for bifurcation. Changes in the fair value of FVO assets and liabilities as well as the mark-to-market adjustment on the entire class of hybrid instruments, including derivatives and the net realized gains or losses on these instruments are reported in the change in fair value of financial instruments and hybrid instrument designated at FVO in the consolidated statements of operations.

For the year ended December 31, 2022, the Company did not note any fair value movement on FVO liabilities attributable to any instrument-specific credit risk, which should be recorded in other comprehensive income (loss).

Hybrid Instruments

The Company elected to apply FVO accounting to all of the hybrid instruments issued, including structured notes. The valuation of the hybrid instruments is predominantly driven by the derivative features embedded within the instruments. The Company determined and performed the valuations of the hybrid instruments with the assistance of an independent valuation service provider. The valuation methodology utilized is consistent with the income approach for estimating the fair value of the interest-bearing portion of the instrument and the related derivatives. Cash flows of

the hybrid instruments in their entirety, including the embedded derivatives, are discounted at an appropriate rate for the applicable duration of the instrument. Interest on the interest-bearing portion of the instrument that is held to maturity is aggregated as gain (loss) on instruments designated at fair value and related derivatives in the change in fair value of financial instruments and hybrid instruments designated at FVO in the consolidated statements of operations.

The following table summarizes the fair value and unpaid principal balance for items the Company accounts under FVO:


(in thousands)	Fair value		Unpaid Principal Balance		Fair Value Over (Under) Unpaid Principal Balance
At December 31, 2022
Hybrid Instrument:
Streeterville note	$	7,839	$	6,221	$	1,618


(in thousands)	Fair value		Unpaid Principal Balance		Fair Value Over (Under) Unpaid Principal Balance
At December 31, 2021
Hybrid Instrument:
Streeterville note	$	7,818	$	6,221	$	1,597

- 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

Organization and Business - Nasdaq Communication and Compliance (Details)	Jan. 23, 2023 $ / shares	Jan. 20, 2023	Jan. 05, 2023 $ / shares	Feb. 17, 2022 $ / shares	Sep. 03, 2021
Consecutive business days				30 days
Reverse stock split ratio					0.33
Minimum
Share Price				$ 1.00
Subsequent event
Consecutive business days			10 days
Reverse stock split ratio	0.01	0.01
Common stock, par value (in dollars per share)	$ 0.0001		$ 0.0001
Subsequent event \| Minimum
Share Price			$ 1.00
Reverse stock split ratio		0.33
Subsequent event \| Maximum
Reverse stock split ratio		0.01

Commitments and Contingencies - Undiscounted cash payment obligation (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Commitments and Contingencies
2023	$ 642
2024	605
2025	160
2026	32
Total undiscounted operating lease payments	1,439
Imputed interest expenses	(231)
Total	1,208	$ 1,159
Less: Operating lease liability, current	483	240
Operating lease liability, net of current portion	$ 725	$ 919

Income Taxes

12 Months Ended

Dec. 31, 2022

Income Taxes

Income Taxes

13. Income Taxes

The Company's loss before provision for income taxes during the years ended December 31, 2022 and 2021, was a domestic loss of $42.1 million and $48.0 million, and a foreign loss of $6.3 million and $4.6 million, respectively.

The effective tax rate for 2022 and 2021 was 0%. As a result of the Company's history of net operating losses (“NOL”) and a full valuation allowance against its deferred tax assets, there was minimal current income tax and no deferred income tax provision for the years ended December 31, 2022 and 2021.

The Company’s effective tax during the years ended December 31, 2022 and 2021, differed from the federal statutory rate as follows:


	December 31,
	2022		2021
Statutory rate	(21.0)	%	(21.0)	%
State taxes	(1.8)	%	—	%
Intercompany transactions	0.2	%	—	%
Valuation allowance	18.3	%	13.4	%
Nondeductible warrant expense	(0.3)	%	—	%
Book loss on debt extinguishment	1.0	%	4.2	%
Foreign rate differential	(0.7)	%	—	%
Other	4.3	%	3.4	%
Effective tax rate	—	%	—	%

Net deferred tax assets as of December 31, 2022 and 2021 consisted of the following:


	December 31,
(In thousands)	2022		2021
Non-current deferred tax assets:
Net operating losses	$	24,773	$	21,153
Tax credits		241		241
Stock compensation		3,042		2,161
Other		1,006		450
		29,062		24,005
Valuation allowance		(28,454)		(19,865)
Net non-current deferred tax assets		608		4,140
Non-current deferred tax liabilities:
Other		(566)		(678)
Property and equipment		(42)		(3,462)
Net non-current deferred tax liability		(608)		(4,140)
Net non-current deferred tax asset (liability)	$	—	$	—

A valuation allowance is provided when it is more likely than not that the deferred tax assets will not be realized. The Company has established a valuation allowance to offset net deferred tax assets as of December 31, 2022 and 2021, due to the uncertainty of realizing future tax benefits from its NOL carryforwards and other deferred tax assets.

The valuation allowance increased by $8.6 million during the year ended December 31, 2022.

As of December 31, 2022, the Company had federal and California NOL carryovers of approximately $96.7 million and $29.4 million, respectively. Of the federal NOL, $20.7 million will begin to expire in 2034 and $114.4 million will carryforward indefinitely. The California NOL will begin to expire in 2033.

As of December 31, 2022, the Company had California research credit carryovers of approximately $382,000. The California research credits carry forward indefinitely. The Company had no Federal research credit carryovers.

Utilization of the domestic NOL and tax credit forwards may be subject to a substantial annual limitation due to ownership change limitations that may have occurred or that could occur in the future, as required by the Internal Revenue Code Section 382, as well as similar state provisions. In general, an "ownership change," as defined by the code, results from a transaction or series of transactions over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by certain stockholders or public groups. Any limitation may result in expiration of all or a portion of the NOL or tax credit carryforwards before utilization. The Company has previously reduced its federal and California R&D credit carryforwards by $1.4 million and $697,000, respectively.

Enacted on March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“the CARES Act”) authorizes more than $2.0 trillion to battle COVID-19 and its economic effects, including immediate cash relief for individual citizens, loan programs for small business, support for hospitals and other medical providers, and various types of economic relief for impacted businesses and industries. The CARES Act does not have a material impact on the Company’s financial results for the year ended December 31, 2022 and 2021.

The Consolidated Appropriations Act, 2021 (the "Act") was enacted in the United States on December 27, 2020. The Act enhances and expands certain provisions of the CARES Act. The Act does not have a material impact on the Company’s financial results for the year ended December 31, 2022 and 2021.

Uncertain Tax Positions

The Company has adopted the provisions of ASC 740, “Income Taxes Related to Uncertain Tax Positions.” Under these principals, tax positions are evaluated in a two-step process. The Company first determines whether it is more-likely-than-not that a tax position will be sustained upon examination. If a tax position meets the more-likely-than-not recognition threshold it is then measured to determine the amount of benefit to be recognized in the financial statements. The tax position is measured as the largest amount of benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement.

As of December 31, 2022, all unrecognized tax benefits were offset against deferred tax assets which are subject to a full valuation allowance, and if recognized, will not affect the Company's tax rate.

The Company does not anticipate that the total amounts of unrecognized tax benefits will significantly increase or decrease in the next 12 months.

The Company's policy is to include interest and penalties related to unrecognized tax benefits within its provision for income taxes. Due to the Company's net operating loss position, the Company has not recorded an accrual for interest or penalties related to uncertain tax positions for the years ended December 31, 2022 or 2021.

The following is a reconciliation of the beginning and ending amount of the Company’s total gross unrecognized tax benefit liabilities:


	December 31,
(In thousands)	2022		2021
Gross Unrecognized Tax Benefit--Beginning Balance	$	77	$	77
Increases Related to Tax Positions from Prior Years		—		—
Increases Related to Tax Positions Taken During the Current Year		—		—
Gross Unrecognized Tax Benefit--Ending Balance	$	77	$	77

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Subparagraph (b)
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-SubTopic 30
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-Paragraph 2
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-URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Summary of Significant Accounting Policies - Revenue Recognition (Details)	12 Months Ended
	Dec. 31, 2022 USD ($) item agreement	Dec. 31, 2021 USD ($)
Disaggregation of Product Revenue
Number of distribution agreements \| agreement	2
Mytesi
Disaggregation of Product Revenue
Product revenue	$ 11,700,000	$ 4,300,000
Number of specialty pharmacies. \| item	5
Mytesi \| Specialty Pharmacies
Disaggregation of Product Revenue
Product revenue	$ 10,300,000	993,000
Canalevia-CA1
Disaggregation of Product Revenue
Product revenue	167,000	0
Neonorm
Disaggregation of Product Revenue
Product revenue	$ 48,000	$ 62,000

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 42
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-Publisher FASB
-Name Accounting Standards Codification
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-Paragraph 5
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130545-203045

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-URI https://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

Commitments and Contingencies - Purchase Commitment (Details) - Manufacturing and Supply Agreement with Glenmark Life Sciences Limited [Member] - kg		12 Months Ended
	Sep. 03, 2020	Dec. 31, 2022
Purchase Commitment
License agreement term (in years)	2 years 6 months
Agreement extension term	2 years
License termination term option	12 months
License termination activated upon written notice of material breach of Agreement	90 days
Number of remaining commitments of kilograms		125
Minimum
Purchase Commitment
Number of kilograms of crofelemer per year per agreement	500

Balance Sheet Components - Property and Equipment (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Land, Property and Equipment
Total property and equipment at cost	$ 961,000	$ 948,000
Accumulated depreciation	(404,000)	(298,000)
Property and equipment, net	557,000	650,000
Depreciation and amortization expense	171,000	33,000
Land
Land, Property and Equipment
Total property and equipment at cost	396,000	396,000
Lab equipment
Land, Property and Equipment
Total property and equipment at cost	477,000	424,000
Clinical equipment
Land, Property and Equipment
Total property and equipment at cost		65,000
Software
Land, Property and Equipment
Total property and equipment at cost	63,000	$ 63,000
Furniture and fixtures
Land, Property and Equipment
Total property and equipment at cost	18,000
Computers and peripherals
Land, Property and Equipment
Total property and equipment at cost	$ 7,000

Preferred Stock (Tables)

12 Months Ended

Dec. 31, 2022

Preferred Stock.

Schedule of convertible preferred stock

At December 31, 2022 and 2021, preferred stock consisted of the following:


							Liquidation
(in thousands, except share and per share data)	Shares		Issued and		Carrying		Preference
Series	Authorized		Outstanding		Value		per Share
B-2		10,165		—	$	—	$	—
C		1,011,000		—		—		—
E		4,475,074		—		—		—
Total		5,496,239		—	$	—

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2022

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Basis of Presentation

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP").

Principles of Consolidation

The consolidated financial statements have been prepared in accordance with U.S. GAAP and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) and include the accounts of the Company and its subsidiaries. All inter-company transactions and balances have been eliminated in consolidation. The reporting currency of the Company is the U.S. dollar.

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires the Company’s management to make judgments, assumptions and estimates that affect the amounts reported in its audited consolidated financial statements and the accompanying notes. The accounting policies that reflect the Company’s more significant estimates and judgments and that the Company believes are the most critical to aid in fully understanding and evaluating its reported financial results are the valuation of stock options, restricted stock units (“RSUs”), valuation of hybrid instruments designated at fair value option (“FVO”), valuation of warrant liabilities, acquired in-process research and development (“IPR&D”), and useful lives assigned to long-lived assets; impairment assessment of non-financial assets; valuation adjustments for excess and obsolete inventory; allowance for doubtful accounts; deferred taxes and valuation allowances on deferred tax assets; evaluation and measurement of contingencies; and recognition of revenue, including estimates for product returns. Those estimates could change, and as a result, actual results could differ materially from those estimates.

In March 2020, the World Health Organization declared the COVID-19 outbreak to be a pandemic. During the year ended December 31, 2022, the Company’s financial results were not significantly affected by the COVID-19 outbreak. The Company has considered all information available as of the date of issuance of these financial statements and the Company is not aware of any specific events or circumstances that would require an update to its estimates or judgments, or a revision to the carrying value of its assets or liabilities. These estimates may change as new events occur and additional information becomes available. The extent to which the COVID-19 outbreak affects the Company’s future financial results and operations will depend on future developments which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of the outbreak, and current or future domestic and international actions to contain and treat it.

Cash

The Company’s cash on deposit may exceed United States federally insured limits at certain times during the year. The Company maintains cash accounts with certain major financial institutions in the United States. The Company does not have cash equivalents as of December 31, 2022 and 2021.

Accounts Receivable

Accounts receivable is recorded net of allowances for discounts for prompt payment and credit losses. The Company estimates an allowance for credit losses by considering factors such as historical experience, credit quality, the age of the accounts receivable balances, and current economic conditions that may affect a customer’s ability to pay. The credit loss allowance was immaterial as of December 31, 2022 and 2021.The corresponding expense for the credit loss allowance is reflected in general and administrative expenses. The credit loss allowance was immaterial as of December 31, 2022 and 2021.

Concentrations

Cash is the financial instrument that potentially subjects the Company to a concentration of credit risk as cash is deposited with banks and cash balances are generally in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits.

For the years ended December 31, 2022 and 2021, substantially all of the Company’s revenue was derived from the sale of Mytesi. In looking at sales by the Company to distributors whose net revenue percentage of total net revenue was equal to or greater than 10%, for fiscal years 2022 and 2021, the Company earned Mytesi revenue primarily from three and one major pharmaceutical distributor(s) located in the United States, respectively. Revenue earned from each major customer as a percentage of total revenue is as follows:


	Year Ended
	December 31,
	2022		2021
Customer 1	—	%	73	%
Customer 2	35	%	11	%
Customer 3	53	%	12	%

On September 3, 2021, the Company ended its engagement with Cardinal Health as its exclusive title model customer for commercial sales and fully implemented its limited distribution Specialty Pharmacy model. Cardinal Health continues to provide third-party logistics services for Mytesi.

The Company is subject to credit risk from its accounts receivable related to its sales. The Company generally does not perform evaluations of customers' financial condition and generally does not require collateral. Accounts receivable balance of the significant customers as a percentage of total accounts receivable is as follows:



	December 31,
	2022		2021
Customer 1	—	%	16	%
Customer 2	38	%	37	%
Customer 3	54	%	37	%

The Company is subject to concentration risk from its suppliers. The Company sources raw material used to produce the active pharmaceutical ingredient (“API”) in Mytesi from two suppliers and is dependent on a single third-

party contract manufacturer for the supply of API in Mytesi and a single third-party contract manufacturer as well for the supply of finished products for commercialization.

Other Risks and Uncertainties

The Company’s future results of operations involve a number of risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, rapid technological change, obtaining second source suppliers, regulatory approval from the FDA or other regulatory authorities, the results of clinical trials and the achievement of milestones, market acceptance of the Company’s product candidates, competition from other products and larger companies, protection of proprietary technology, strategic relationships and dependence on key individuals.

Recent Global Events

Macroeconomic conditions, including the war in Ukraine and related sanctions, exchange rate and interest rate volatility, and inflationary pressures, will continue to evolve globally. The greatest impact was a decline in Europe where the impacts of foreign currency exchange rates, the war in Ukraine, and energy inflation were the greatest. The Company’s partially owned subsidiary in Italy, Napo Therapeutics, does not generate any revenue yet for the year ended December 31, 2022. There were no significant changes in the subsidiary’s operations for the year ended December 31, 2022, because of these recent global events.

Silicon Valley Bank (SVB) Failure

On March 2023, SVB, has been closed by regulators after the bank’s announcement of a $1.8 billion securities loss following a deposit outflow and plans to raise $2.25 billion by selling its common and preferred stocks. As a result, venture capital firms urged companies to withdraw their cash and investments from SVB to prevent being possibly caught-up of its failure. After its close, SVB became under the receivership of FDIC. As of December 31, 2022, the Company has no cash deposits nor investments within the bank and does not expect any impact from its cash deposits from its financial institutions.

Fair Value

The Company’s financial instruments include accounts receivable, accounts payable, accrued liabilities, warrant liability, operating lease liability, equity-linked financial instruments, and debt. The recorded carrying amount of accounts receivable, accounts payable and accrued liabilities reflect their fair value due to their short-term nature. Other financial liabilities are initially recorded at fair value, and subsequently measured at either fair value or amortized cost using the effective interest method. See Note 3 for the fair value measurements.

Fair Value Option

ASC 825-10, Financial Instruments, provides FVO election that allows companies an irrevocable election to use fair value as the initial and subsequent accounting measurement attribute for certain financial assets and liabilities. ASC 825-10 permits entities to elect to measure eligible financial assets and liabilities at fair value on an ongoing basis. Unrealized gains and losses on items for which the FVO has been elected are reported in earnings. The decision to elect the FVO is determined on an instrument-by-instrument basis, must be applied to an entire instrument and is irrevocable once elected. Assets and liabilities measured at fair value pursuant to ASC 825-10 are required to be reported separately from those instruments measured using another accounting method. In accordance with the options presented in ASC 825-10, the Company elected to present the aggregate of fair value and non-fair-value amounts in the same line item in the consolidated balance sheets and parenthetically disclose the amount measured at fair value in the aggregate amount.

Inventory

Inventory is stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out method. Cost is initially recorded at the invoiced amount of raw materials or API, including the sum of qualified expenditures and charges in bringing the inventory to its existing condition and location. The Company calculates inventory valuation adjustments when conditions indicate that net realizable value is less than cost due to physical deterioration, usage, obsolescence, reductions in estimated future demand or reduction in selling price. Inventory write-downs are measured as the difference between the cost of inventory and net realizable value. The Company does not have an allowance for inventory obsolescence as of December 31, 2022 and 2021.

Prelaunch Inventory

The Company’s policy is to capitalize costs for prelaunch inventories within the drug development phase that evidence that the product’s reasonably likely critical attributes for success are present and feasible, and the key causes of failures are absent based on management’s assumptions.

Property and Equipment

Land is stated at cost, reflecting fair value of the property at July 31, 2017, the date of the Napo merger. Equipment is stated at cost, net of accumulated depreciation. Equipment begins to be depreciated when it is placed into service. Depreciation is calculated using the straight-line method over estimated useful lives ranging between 3 to 10 years.

Expenditures for repairs and maintenance of assets are charged to expense as incurred. Costs of major additions and betterments are capitalized and depreciated on a straight-line basis over their estimated useful lives. Upon retirement or sale, the cost and related accumulated depreciation of assets disposed of are removed from the accounts and any resulting gain or loss is included in the consolidated statements of operations.

Software Developed for Internal Use

The Company capitalizes the costs of developing software for internal use. These costs include both purchased software and internally developed software. Costs of developing software are expensed until technological feasibility has been established. Thereafter, all costs are capitalized and are carried at the lower of unamortized cost or net realizable value. Internally developed and purchased software costs are generally amortized over five years.

Long-Lived Assets

The Company regularly reviews the carrying value and estimated lives of all of its long-lived assets, including property and equipment and definite-lived intangible assets, to determine whether indicators of impairment exist that warrant adjustments to carrying values or estimated useful lives. The determinants used for this evaluation include management’s estimate of the asset’s ability to generate positive income from operations and positive cash flow in future periods as well as the strategic significance of the assets to the Company’s business objectives. If the Company determines that an impairment trigger has been met, the Company evaluates the realizability of its long-lived assets (asset group) based on a comparison of projected undiscounted cash flows from use and eventual disposition with the carrying value of the related asset. Any write-downs (which are measured based on the difference between the fair value and the carrying value of the asset) are treated as permanent reductions in the carrying amount of the assets (asset group). Based on this evaluation, the Company believes that, as of each of the balance sheet dates presented, none of the Company’s long-lived assets were impaired. The Company’s had no impairment of long-lived assets for the years ended December 31, 2022 and 2021.

Indefinite-lived Intangible Assets

Acquired IPR&D are intangible assets acquired in the July 2017 Napo merger. Under ASC 805, IPR&D are initially recognized at fair value and classified as indefinite-lived assets until the successful completion or abandonment of the associated research and development efforts. During the development period, these assets will not be amortized as charges to earnings; instead, these assets will be tested for impairment on an annual basis or more frequently if impairment indicators are identified. An impairment loss is measured based on the excess of the carrying amount over the asset’s fair value. The Company recorded an impairment of zero for the years ended December 31, 2022 and 2021.

Leases

The Company accounts for its leases in accordance with ASC 842, Leases.

At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present. Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over the expected lease term. Because the interest rate implicit in lease contracts is typically not readily determinable, the Company utilizes its incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term, an amount equal to the lease payments in a similar economic environment. Certain adjustments to the right-of-use asset may be required for items such as initial direct costs paid or incentives received.

The Company elected to include both the lease and non-lease components as a single component and account for it as a lease.

Research and Development Expense

Research and development expense consists of expenses incurred in performing research and development activities including related salaries, clinical trial and related drug and non-drug product costs, contract services and other outside service expenses. Research and development expense is charged to operating expense in the period incurred.

Clinical Trial Accruals

Clinical trial costs are a component of research and development expenses. The Company accrues and expenses clinical trial activities performed by third parties based upon actual work completed in accordance with agreements established with clinical research organizations and clinical sites. The Company determines the costs to be recorded based upon validation with the external service providers as to the progress or stage of completion of trials or services and the agreed-upon fee to be paid for such services.

Revenue Recognition

The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”).

The Company’s policy typically permits returns if the product is damaged, defective, or otherwise cannot be used when received by the customer if the product has expired. Returns are accepted for product that will expire within six months or that have expired up to one year after their expiration dates. Estimates for expected returns of expired products are based primarily on an ongoing analysis of our historical return patterns.

The Company recognizes revenue in accordance with the core principle of ASC 606 or when there is a transfer of control of promised goods to customers in an amount that reflects the consideration that the Company expects to be entitled to in exchange for those goods.

The Company recognizes the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the Company otherwise would have recognized is one year or less.

The Company does not adjust the amount of consideration for the effects of a significant financing component if, at contract inception, the expected period between the transfer of promised goods and customer payment is one year or less.

The Company has elected to treat shipping and handling activities as fulfillment costs.

Additionally, the Company elected to record revenue net of sales and other similar taxes.

Contracts and Agreements

Effective January 16, 2019, Napo engaged Cardinal Health SPS as its exclusive third-party logistics distribution agent for commercial sales for the Company’s Mytesi product and to perform certain other services which include, without limitation, storage, distribution, returns, customer support, financial support, Electronic Data Interchange and system access support (the “Exclusive Distribution Agreement”).

The Company's Canalevia-CA1 and Neonorm products are primarily sold to distributors, who then sell the products to the end customers. Since 2021, the Company has entered into two distribution agreements with established distributors to distribute the Company’s animal health products in the United States. The distribution agreements and the related purchase orders together meet the contract existence criteria under ASC 606 10 25 1. The Company sells directly to its customers without the use of an agent.

Performance obligations

For animal health products sold by the Company, the single performance obligation identified above is the Company’s promise to transfer the Company’s animal health products to distributors based on specified payment and shipping terms in the arrangement. Product warranties are assurance-type warranties that do not represent a performance obligation. For the Company’s human health product, Mytesi, the single performance obligation identified above is the Company’s promise to transfer Mytesi to specialty pharmacies, based on specified payment and shipping terms as outlined in the Exclusive Distribution Agreement.

Transaction price

For contracts with Cardinal Health and other distributors, the transaction price is the amount of consideration to which the Company expects to collect in exchange for transferring the promised goods or services. The transaction price of Mytesi is the Wholesaler Acquisition Cost (“WAC”), and the transaction price of Canalevia-CA1 and Neonorm is the manufacturer’s list price, net of discounts, returns, and price adjustments.

Allocate transaction price

For contracts with Cardinal Health and other distributors, the entire transaction price is allocated to the single performance obligation contained in each contract.

Revenue recognition

For contracts with Cardinal Health, for the Company, a single performance obligation is satisfied at a point in time, upon the FOB terms of each contract when control, including title and all risks, has transferred to the customer.

Disaggregation of Product Revenue

Human

Sales of Mytesi are recognized as revenue at a point in time when the products are delivered to the wholesaler. Net revenues from the sale of Mytesi were $11.7 million and $4.3 million for the years ended December 31, 2022 and 2021, respectively.

Animal

The Company recognized Canalevia-CA1 products revenues of $167,000 and zero for the years ended December 31, 2022 and 2021, respectively. The Company recognized Neonorm revenues of $48,000 and $62,000 for the years ended December 31, 2022 and 2021, respectively. Revenues are recognized at a point in time upon shipment, which is when title and control is transferred to the buyer. Sales of Canalevia-CA1, Neonorm Calf and Foal to distributors are made under agreements that may provide distributor price adjustments and rights of return under certain circumstances.

Contracts – Specialty Pharmacies

Effective October 1, 2020, the Company engaged a private company as its third-party logistics distribution agent for commercial sales of the Company’s Mytesi product. Under the Specialty Product Distribution Agreement, the Company shall supply the products to the private company’s specialty pharmacies, through a designated wholesaler, in such amounts as may be ordered. There is no minimum purchase or inventory requirement. The specialty pharmacies were authorized distributors of record for all National Drug Codes (“NDCs”) of Mytesi.

Effective April 20, 2021, the Company engaged another private company as an authorized specialty pharmacy provider of Mytesi. Under the Specialty Pharmacy Distribution and Services Agreement, the private company shall sell and dispense the Mytesi directly ordered from the Company at the agreed price to patients within the territories identified in the agreement.

The Company has entered into agreements with a total of five different specialty pharmacy chains that are authorized to provide Mytesi to patients.

Performance obligations

The single performance obligation is the Company’s promise to transfer Mytesi to specialty pharmacies, based on specified payment and shipping terms outlined in the agreements.

Transaction price

The transaction price is the amount of consideration to which the Company expects to collect in exchange for transferring the promised goods or services. The transaction price of Mytesi is the WAC, net of estimated discounts, returns, and price adjustments.

Allocate transaction price

The entire transaction price is allocated to the single performance obligation contained in each contract.

Revenue recognition

The single performance obligation is satisfied at a point in time, upon the free on board (“FOB”) terms of each contract, when control, including title and all risks, has transferred to the customer.

Product Revenue

Sales of Mytesi are recognized as revenue at a point in time when the products are delivered to the specialty pharmacies. Net revenues from the sale of Mytesi to the specialty pharmacies were $10.3 million and $993,000 for the years ended December 31, 2022 and 2021, respectively.

Collaboration Revenue

Revenue recognition for collaboration agreements requires significant judgment. The Company’s assessments and estimates are based on contractual terms, historical experience and general industry practice. Revisions in these values or estimations have the effect of increasing or decreasing collaboration revenue in the period of revision.

On September 24, 2018, the Company entered into a Distribution, License and Supply Agreement (“License Agreement”) with Knight Therapeutics ("Knight"). The License Agreement has a term of 15 years (with automatic renewals) and provides Knight with an exclusive right to commercialize current and future Jaguar human health products (including crofelemer, NP-300, and any product containing a proanthocyanidin or with an anti-secretory mechanism) in Canada and Israel. Knight forfeited its right of first negotiation for expansion to Latin America. Under the License Agreement, Knight is responsible for applying for and obtaining necessary regulatory approvals in the territory of Canada and Israel, as well as marketing, sales and distribution of the licensed products. Knight will pay a transfer price for all licensed products, and upon achievement of certain regulatory and sales milestones, the Company may receive payments from Knight in an aggregate amount of up to approximately $18 million payable throughout the initial 15-year term of the agreement. The Company did not have any license revenues for the years ended December 31, 2022 and 2021.

Modifications to Liability-classified Instruments

In accounting for debt modifications and exchange transactions, it is the Company’s policy to first determine whether it qualifies as a Troubled Debt Restructuring (“TDR”) pursuant to the guidance provided in ASC 470-60. A debt modification or exchange transaction that is not within the scope of the ASC 470-60 is accounted for under ASC 470-50 to determine if the transaction is a mere modification or an extinguishment.

For the year December 31, 2022, the Company entered into another amendment on the terms of its October 2020 and March 2021 Purchase Agreements (see Note 7).

Modifications to Equity-classified Instruments

In accounting for modifications of equity-classified warrants, it is the Company’s policy to determine the impact by analogy to the share-based compensation guidance of ASC 718, Compensation - Stock Compensation (“ASC 718”). The model for a modified share-based payment award that is classified as equity and remains classified in equity after the modification is addressed in ASC 718-20-35-3. Pursuant to that guidance, the incremental fair value from the modification is recognized as an expense in the statements of operations to the extent the modified instrument has a higher fair value; however, in certain circumstances, such as when an entire class of warrants are modified, the measured increase in fair value may be more appropriately recorded as a deemed dividend, depending upon the nature of the warrant modification.

The Company did not modify any equity-classified warrants in the year 2022 and 2021.

In accounting for amendments to equity-classified preferred stock, it is the Company’s policy to measure the impact by analogy to ASC 470-50 in determining if such an amendment is an extinguishment or a modification. If the amendment results in an extinguishment, the Company follows the SEC staff guidance in ASC 260-10-S99-2 and ASC 470-20. If the amendment results in a modification, the Company follows the model in either ASC 718 or ASC 470-50, depending on the nature of the amendment.

The Company did not modify any equity-classified preferred stock in the year 2022 and 2021.

Stock-Based Compensation

The Company's Stock Incentive Plan (see Note 11) provides for the grant of stock options, restricted stock and restricted stock unit awards. The Company measures stock awards granted to employees, non-employees and directors at estimated fair value on the date of grant and recognizes the corresponding compensation expense of the awards, net of estimated forfeitures, over the requisite service periods, which correspond to the vesting periods of the awards. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company issues stock awards with only service-based vesting conditions, and records compensation expense for these awards using the straight-line method.

The Company uses the grant date fair market value of its common stock to determine the grant date fair value of options granted to employees, non-employees and directors. The Company measures and recognizes compensation expense for all stock options and restricted stock units (“RSUs”) granted to its employees and directors based on the estimated fair value of the award on the grant date. The Company uses the Black-Scholes valuation model to estimate the fair value of stock option awards. The fair value is recognized as expense, net of estimated forfeitures, over the requisite service period, which is generally the vesting period of the respective award, on a straight-line basis. The Company believes that the fair value of stock options granted to non-employees is more reliably measured than the fair value of the services received. The determination of the grant date fair value of options using an option pricing model is affected by the Company’s estimated Common Stock fair value and requires management to make a number of assumptions including the expected life of the option, the volatility of the underlying stock, the risk-free interest rate and expected dividends.

The Company estimates the fair value of stock options using the Black-Scholes option valuation model. The fair value of employee stock options is being amortized on a straight-line basis over the requisite service period of the awards. The fair market value of common stock is based on the closing price of the Company’s common stock as reported on the date of the grant.

Income Taxes

The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and the tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized.

The Company has adopted the provisions of ASC 740, Income Taxes Related to Uncertain Tax Positions. Under these principals, tax positions are evaluated in a two-step process. The Company first determines whether it is more-likely-than-not that a tax position will be sustained upon examination. If a tax position meets the more-likely-than-not recognition threshold, it is then measured to determine the amount of benefit to be recognized in the financial statements. The tax position is measured as the largest amount of benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement.

Foreign Currency Remeasurement and Translation

The functional currency of Napo Therapeutics is Euro. The Company follows ASC 830, Foreign Currency Matters (“ASC 830”). ASC 830 requires the assets, liabilities, and results of operations of a foreign operation to be measured using the functional currency of that foreign operation. Exchange gains or losses from remeasuring transactions and monetary accounts in a currency other than the functional currency are included in current earnings.

For certain subsidiaries, translation adjustments resulting from the process of translating the functional currency of subsidiary financial statements into the U.S. Dollar reporting currency. These translation adjustments are

reported separately and accumulated in the consolidated balance sheets as a component of accumulated other comprehensive loss.

Comprehensive Loss

The Company follows ASC 220, Comprehensive Income, which establishes standards for reporting and displaying comprehensive income and its components (revenue, expenses, gains and losses) in a full set of general-purpose financial statements.

For the years ended December 31, 2022 and 2021, the amount of other comprehensive losses from translation adjustments were $680,000 and zero, respectively.

Basic and Diluted Net Loss Per Common Share

Basic net loss per common share is computed by dividing net loss attributable to common stockholders for the year by the weighted-average number of common shares outstanding during the year. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders for the year by the weighted-average number of common shares, including potential dilutive shares of common stock assuming the dilutive effect of potential dilutive securities. For years in which the Company reports a net loss, diluted net loss per common share is the same as basic net loss per common share, because their impact would be anti-dilutive to the calculation of net loss per common share. Diluted net loss per common share is the same as basic net loss per common share for the years ended December 31, 2022 and 2021.

Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. The Company adopted the standard on January 1, 2022. The adoption of this standard did not have a material effect on the Company’s audited consolidated financial statements and related disclosures.

In May 2021, the FASB issued ASU 2021-04, Issuer’s Accounting for Certain Modification or Exchanges of Freestanding Equity-Classified Written Call Options – a consensus of the FASB Emerging Issues Task Force. The ASU provides a principles-based framework to determine whether an issue should recognize the modification or exchange as an adjustment to equity or an expense. The Company adopted the standard on January 1, 2022. The adoption of this standard did not have a material effect on the Company’s audited consolidated financial statements and related disclosures.

Recently Issued Accounting Pronouncements Not Yet Adopted

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The main objective of the standard is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in this standard replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The update is effective for the Company beginning January 1, 2023 with early adoption permitted. The Company is still evaluating the impact of the adoption of this standard.

In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, to provide specific guidance to eliminate diversity in practice on how to recognize and measure acquired contract assets and contract liabilities from revenue contracts from customers in a business combination consistent with revenue contracts with customers not acquired in an acquisition. The amendments in this update provide that the acquirer should consider the terms of the acquired contracts, such as timing of payment, identify each performance obligation in the contracts, and allocate the total transaction price to each identified performance obligation on a relative standalone selling price basis as of contract inception (that is, the date the acquiree entered into the contracts) or contract modification to determine what should be recorded at the acquisition date. These amendments are effective for the Company beginning with fiscal year 2023. The impact of the adoption of the amendments in this update will depend on the magnitude of any customer contracts assumed in a business combination in 2023 and beyond.

Debt - Notes Payable - Future Maturities (Details) - Future maturities of the notes payable not designated at FVO $ in Thousands	Dec. 31, 2022 USD ($)
As of September 30,
2023	$ 15,882
2024	23,483
2025	50
Total	39,415
Less: unamortized discount and debt issuance costs	(13,628)
Notes payable, net of discount	$ 25,787

Debt - Oasis Secured Borrowing (Details) - USD ($) $ in Thousands	1 Months Ended
	Dec. 31, 2020	May 31, 2020	Dec. 31, 2022	Dec. 31, 2021
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Accounts receivable			$ 1,879	$ 1,709
Oasis Capital \| Oasis Secured Note Tranche 6
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Proceeds from receivables, Gross	$ 1,600
Accounts receivable	2,200
Accounts receivable gross	3,800
Accumulated chargebacks and discounts on accounts receivable	1,600
Threshold price	$ 1,800
Accounts Receivable Purchase Agreement \| Oasis Capital
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Agreement term		1 year

Stock-Based Compensation - Stock-Based Compensation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Stock-Based Compensation
Total stock-based compensation expense	$ 3,318	$ 3,974
Research and development expense
Stock-Based Compensation
Total stock-based compensation expense	1,263	1,319
Sales and marketing expense
Stock-Based Compensation
Total stock-based compensation expense	267	319
General and administrative expense
Stock-Based Compensation
Total stock-based compensation expense	1,788	$ 2,336
Stock options and RSUs
Stock-Based Compensation
Unrecognized stock-based compensation expense	$ 2,700
Expected weighted average period to be recognized	1 year 8 months 12 days
Employee stock options
Estimated grant-date fair value of stock options calculated using the Black-Scholes option-pricing model
Volatility (as a percent)	164.00%
Expected term (years)	5 years	5 years
Risk-free interest rate (as a percent)	3.20%
Minimum \| Employee stock options
Estimated grant-date fair value of stock options calculated using the Black-Scholes option-pricing model
Volatility (as a percent)		163.80%
Risk-free interest rate (as a percent)		0.50%
Maximum \| Employee stock options
Estimated grant-date fair value of stock options calculated using the Black-Scholes option-pricing model
Volatility (as a percent)		164.00%
Risk-free interest rate (as a percent)		1.20%

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2022

Commitments and Contingencies

Schedule of additional details of office space lease


	December 31,
	2022		2021
(in thousands)
Operating lease - right-of-use asset	$	1,140	$	1,084

Operating lease liability, current		483		240
Operating lease liability, net of current portion		725		919
Total	$	1,208	$	1,159

Weighted-average remaining life (years)		2.36		3.21
Weighted-average discount rate		17.89%		21.10%

Schedule of undiscounted cash payment obligations

The following table summarizes the undiscounted cash payment obligations for the operating lease liability:


	December 31,
	2022
(in thousands)
2023		642
2024		605
2025		160
2026		32
Total undiscounted operating lease payments		1,439
Imputed interest expenses		(231)
Total operating lease liability		1,208
Less: Operating lease liability, current		483
Operating lease liability, net of current portion	$	725

Debt (Tables)

12 Months Ended

Dec. 31, 2022

Debt

Schedule of notes payable


	December 31,
	2022		2021
(in thousands)
Royalty Interest	$	38,931	$	37,000
Streeterville Note		7,840		7,818
Insurance Financing		234		335
Tempesta Note		250		350
		47,255		45,503
Less: unamortized discount and debt issuance costs		(13,628)		(17,297)
Note payable, net of discount	$	33,627	$	28,206
Notes payable - non-current, net	$	17,744	$	25,022
Notes payable - current, net	$	15,883	$	3,184

Schedule of future maturities of notes payable


(in thousands)	Amounts
Years ended December 31,
2023	$	15,882
2024		23,483
2025		50
2026		—
2027		—
		39,415
Less: unamortized discount and debt issuance costs		(13,628)
Total	$	25,787

Preferred Stock

12 Months Ended

Dec. 31, 2022

Preferred Stock.

Preferred Stock

9. Preferred Stock

At December 31, 2022 and 2021, preferred stock consisted of the following:


							Liquidation
(in thousands, except share and per share data)	Shares		Issued and		Carrying		Preference
Series	Authorized		Outstanding		Value		per Share
B-2		10,165		—	$	—	$	—
C		1,011,000		—		—		—
E		4,475,074		—		—		—
Total		5,496,239		—	$	—

Series C Perpetual Preferred Stock

In September 2020, the Company entered into an exchange agreement with Iliad to issue 842,500 shares of the Company's Series C Perpetual Preferred Stock at $0.0001 par value per share, for a non-cash exchange of equity instruments. The exchange agreement was contemporaneously entered with the issuance of Series D Perpetual Preferred shares, in exchange of remaining Series A Convertible Preferred shares totaling 5,524,926 shares, and accreted value of $11.2 million as of the exchange date. An amendment agreement of the Exchange Note 2 was also entered into, with issuance value of $2.3 million and carrying value of $2.6 million as of the exchange date, to extend maturity from December 31, 2020 to December 31, 2021, in consideration of 5% increase in the outstanding balance.

The preferred stock has been classified as permanent stockholders' equity in accordance with authoritative guidance for the classification and measurement of perpetual shares without mandatory redemption period because the

redemption option was ultimately in the control of the Company. There were no series C Preferred Shares outstanding at December 31, 2022 and 2021.

Series E Preferred Stock

On August 18, 2022, the Company entered into an agreement (the “Securities Purchase Agreement”) with Synworld to issue 10 Series E Preferred Stock with a par value of $0.0001, amounting to $100. In consideration of the Securities Purchase Agreement, the Company and Synworld agree to amend the existing definition of the term “Service Share Amount” in the License Agreement entered by both parties (See Note 2) and include a subsection for lock-up wherein Synworld agrees not to sell, transfer, loan, grant any option of the purchase of, or otherwise dispose of any shares of common stock acquired pursuant to the License Agreement until after the 90-day period following the date of acquisition.

On October 4, 2022, the Company redeemed all 10 shares of Series E Preferred Stock in accordance with the terms of such securities. As a result, no shares of Series E Preferred Stock remain outstanding.

Preferred Stock - Series C Perpetual Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended
	Sep. 30, 2020	Dec. 31, 2022	Dec. 31, 2021
Preferred stock, shares outstanding		0	0
Warrants and Rights Outstanding			$ 1
Series A
Preferred stock, shares outstanding	5,524,926
Series C perpetual preferred stock
Preferred stock, shares outstanding		0	0
Carrying value
Iliad \| Series C perpetual preferred stock
Number of shares issued for each convertible preferred stock	842,500
Preferred stock, par value (in dollars per share)	$ 0.0001
Accreted value	$ 11,200
Gross proceeds from the issuance of common stock	2,300
Carrying value	$ 2,600
Percentage increase in the outstanding balance	5.00%

Net Loss Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Net Loss Per Share Attributable to Common Stockholders
Net loss attributable to common shareholders (basic)	$ (47,454)	$ (52,595)
Net loss attributable to common shareholders (diluted)	$ (47,454)	$ (52,595)
Shares used to compute net loss per common share, basic	1,311,519	596,154
Shares used to compute net loss per common share, diluted	1,311,519	596,154
Net loss per share attributable to common shareholders, basic	$ (36.18)	$ (88.22)
Net loss per share attributable to common shareholders, diluted	$ (36.18)	$ (88.22)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Section S99
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-Subparagraph (SX 210.7-04(23))
-URI https://asc.fasb.org/extlink&oid=120400993&loc=SL114874131-224263

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The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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Amount, after deduction of tax, noncontrolling interests, dividends on preferred stock and participating securities, and addition from assumption of issuance of common shares for dilutive potential common shares; of income (loss) available to common shareholders.

+ References + Details

Preferred Stock (Details) - shares	Dec. 31, 2022	Dec. 31, 2021
Class of Stock [Line Items]
Shares Authorized	5,496,239	5,496,239
Issued	0	0
Outstanding	0	0
Series B-2 Preferred Stock
Class of Stock [Line Items]
Shares Authorized	10,165	10,165
Issued	0	0
Outstanding	0	0
Series C perpetual preferred stock
Class of Stock [Line Items]
Shares Authorized	1,011,000	1,011,000
Issued	0	0
Outstanding	0	0
Series E perpetual preferred stock
Class of Stock [Line Items]
Shares Authorized	4,475,074	4,475,074
Issued	0	0
Outstanding	0	0

Balance Sheet Components (Tables)

12 Months Ended

Dec. 31, 2022

Balance Sheet Components

Schedule of inventory


	December 31,
	2022		2021
(in thousands)
Raw Material	$	2,101	$	1,248
Work in Process		3,599		2,760
Finished Goods		1,324		892
Inventory	$	7,024	$	4,900

Schedule of property and equipment


	December 31,
	2022		2021
(in thousands)
Land	$	396	$	396
Lab equipment		477		424
Clinical equipment		—		65
Software		63		63
Furniture and fixtures		18		—
Computers and peripherals		7		—
Total property and equipment at cost		961		948
Accumulated depreciation		(404)		(298)
Property and equipment, net	$	557	$	650

Schedule of intangible assets


	December 31,
	2022		2021
(in thousands)
Developed technology	$	25,000	$	25,000
Accumulated developed technology amortization		(9,028)		(7,361)
Developed technology, net		15,972		17,639
In-process research and development		4,800		4,800
In process research and development, net		4,800		4,800
Trademarks		300		300
Accumulated trademark amortization		(108)		(88)
Trademarks, net		192		212
Internal use software costs - registry		1,236		—
Accumulated internal use software costs amortization		(122)		—
Internal use software costs - registry, net		1,114		—
Patents		361	—	—
Total intangible assets, net	$	22,439	$	22,651

Schedule of estimated future amortization expense of intangible assets with finite lives


(in thousands)	Amounts
2023		1,952
2024		1,952
2025		1,952
2026		1,952
Thereafter		9,831
	$	17,639

Schedule of accrued expenses


	December 31,		December 31,
(in thousands)	2022		2021
Accrued interest	$	5,489	$	3,456
Accrued audit and tax services		575		167
Accrued vacation		310		281
Accrued payroll and commission		263		120
Accrued legal costs		36		414
Accrued local tax		9		285
Accrued payroll tax		1		58
Accrued chargebacks and discounts		—		335
Accrued distributor services fees		—		250
Accrued consulting		—		47
Accrued other		1,482		1,704
Total	$	8,165	$	7,117

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($)	Dec. 31, 2022	Dec. 31, 2021
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
Net loss	$ (48,395,000)	$ (52,600,000)
Other comprehensive loss
Translation adjustments	(680,000)	0
Net loss and comprehensive loss	$ (49,075,000)	$ (52,600,000)

- Definition

Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income. Excludes changes in equity resulting from investments by owners and distributions to owners.

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The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest.

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+ Details

Debt - Sale of Future Royalty Interest (Details) - USD ($)																			1 Months Ended	12 Months Ended
	Nov. 18, 2022	Sep. 30, 2022	Aug. 24, 2022	Aug. 17, 2022	Jul. 25, 2022	May 13, 2022	Apr. 14, 2022	Mar. 09, 2022	Mar. 04, 2022	Mar. 02, 2022	Feb. 11, 2022	Apr. 13, 2021	Mar. 08, 2021	Dec. 22, 2020	Nov. 13, 2020	Oct. 31, 2020	Oct. 08, 2020	Aug. 10, 2020	Jan. 31, 2021	Dec. 31, 2022	Dec. 31, 2021	Nov. 01, 2020
Debt Instrument [Line Items]
Loss on extinguishment of debt																			$ (753,000)	$ (2,187,000)	$ (753,000)
Iliad
Debt Instrument [Line Items]
Royalties incurred	$ 715,000				$ 750,000	$ 400,000		$ 700,000	$ 800,000	$ 1,100,000	$ 2,400,000	$ 3,000,000.0
Issuance of common stock (In shares)	73,333				31,546	15,249		24,667	26,667	32,333	23,117	7,843
Beginning on March 2021
Debt Instrument [Line Items]
Shortfall restoration period													30 days
October 2020 Purchase Agreement
Debt Instrument [Line Items]
Payments for royalties																	$ 12,000,000.0
Aggregate purchase price																	$ 6,000,000.0
Percentage of net sales																	10.00%
Percentage of worldwide revenues																	10.00%
Royalty interest																	$ 12,000,000.0
Royalty discount												$ 77.09						$ 6,000,000.0
Royalty discount rate															45.42%			34.51%		41.35%
Minimum volume weighted average price of stock																$ 0.9105						$ 0.9105
Additional royalty financings committed															$ 6,000,000.0
Loss on extinguishment of debt								$ (2,200,000)
Interest expense																				$ 3,600,000	4,200,000
Carrying value of notes																				$ 7,300,000	$ 6,300,000
Increase In Royalty Repayment Amount																$ 6,000,000.0
October 2020 Purchase Agreement \| Iliad
Debt Instrument [Line Items]
Principal amount							$ 12,000,000.0
October 2020 Purchase Agreement \| Iliad \| Minimum
Debt Instrument [Line Items]
Percentage of shares issued and outstanding							4.99%
October 2020 Purchase Agreement \| Beginning On April 2021
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount																	250,000
Royalty discount rate																				74.59%
October 2020 Purchase Agreement \| Beginning On October 2021
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount																	400,000
October 2020 Purchase Agreement \| Beginning On April 2022
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount																	600,000
October 2020 Purchase Agreement \| Beginning On October 2022
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount																	$ 750,000
December 2020 Purchase Agreement
Debt Instrument [Line Items]
Aggregate purchase price														$ 6,000,000.0
Percentage of net sales														10.00%
Percentage of worldwide revenues														10.00%
Minimum monthly royalty repayment amount														$ 750,000
Royalty interest														12,000,000.0
Royalty discount														$ 6,000,000.0
Royalty discount rate														23.70%							29.55%
Interest expense																				$ 3,900,000	$ 2,900,000
Carrying value of notes																				10,000,000.0	7,600,000
December 2020 Purchase Agreement \| Iliad
Debt Instrument [Line Items]
Principal amount							$ 12,000,000.0
March 2021 Purchase Agreement
Debt Instrument [Line Items]
Aggregate purchase price													$ 5,000,000.0
Percentage of net sales													10.00%
Percentage of worldwide revenues													10.00%
Interest expense																				1,900,000	1,200,000
Carrying value of notes																				$ 3,100,000	$ 5,800,000
Threshold price													$ 10,000,000.0
Percentage of royalties collected from licenses													50.00%
March 2021 Purchase Agreement \| Iliad
Debt Instrument [Line Items]
Principal amount							$ 10,000,000.0
March 2021 Purchase Agreement \| Streeterville
Debt Instrument [Line Items]
Aggregate purchase price				$ 3,400,000
Royalty interest		$ 2,000,000.0
Royalties incurred		$ 2,000,000.0
Issuance of common stock (In shares)		156,863		153,333
Common stock, par value (in dollars per share)				$ 0.0001
March 2021 Purchase Agreement \| Beginning on March 2021
Debt Instrument [Line Items]
Royalty interest													$ 10,000,000.0
Royalty discount													$ 5,000,000.0
Royalty discount rate													19.36%							53.85%	19.14%
March 2021 Purchase Agreement \| Beginning On April 2021
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount													$ 250,000
Increase in royalty repayment, percent													5.00%
March 2021 Purchase Agreement \| Beginning On October 2021
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount													$ 400,000
March 2021 Purchase Agreement \| Beginning On April 2022
Debt Instrument [Line Items]
Increase in royalty repayment, percent													10.00%
Royalty instrument, Debt instrument carrying value													$ 600,000
March 2021 Purchase Agreement \| Beginning On October 2022
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount													$ 750,000
August 2022 Purchase Agreement \| Streeterville
Debt Instrument [Line Items]
Aggregate purchase price			$ 4,000,000.0
Percentage of net sales			10.00%
Percentage of worldwide revenues			10.00%
Royalty interest			$ 12,000,000.0
Royalty discount rate			55.97%
Interest expense																				$ 1,100,000
Carrying value of notes																				$ 4,800,000
Percentage of royalties collected from licenses			50.00%
August 2022 Purchase Agreement \| Until One Year Anniversary \| Streeterville
Debt Instrument [Line Items]
Accrued interest rate on royalty			5.00%
August 2022 Purchase Agreement \| After One Year Anniversary \| Streeterville
Debt Instrument [Line Items]
Accrued interest rate on royalty			10.00%
August 2022 Purchase Agreement \| Beginning On September 2022 \| Streeterville
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount			$ 250,000
August 2022 Purchase Agreement \| Beginning On March 2023 \| Streeterville
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount			400,000
August 2022 Purchase Agreement \| Beginning On September 2023 \| Streeterville
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount			600,000
August 2022 Purchase Agreement \| Beginning On March 2024 \| Streeterville
Debt Instrument [Line Items]
Minimum monthly royalty repayment amount			$ 750,000

Balance Sheet Components - Inventory (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Inventory
Raw Material	$ 2,101	$ 1,248
Work in Process	3,599	2,760
Finished Goods	1,324	892
Inventory	$ 7,024	$ 4,900

Fair Value Measurements - Fair Value of Liabilities Measured on a Recurring Basis (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021	Jan. 13, 2021
Fair value of liabilities measured on a recurring basis
Warrant liability		$ 1
Fair value	$ 7,839	7,818
Total fair value	7,839	7,819
Level 3
Fair value of liabilities measured on a recurring basis
Warrant liability		1
Total fair value	7,839	7,819
Streeterville Note
Fair value of liabilities measured on a recurring basis
Fair value	7,839	7,818	$ 6,000
Streeterville Note \| Level 3
Fair value of liabilities measured on a recurring basis
Fair value	$ 7,839	$ 7,818

Summary of Significant Accounting Policies - Accounts receivable and Concentrations (Details) - item	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Supplier risk
Concentrations
Number of suppliers	2
Total net revenue \| Customer risk \| One major pharmaceutical distributors
Concentrations
Number of major distributors	3	1
Total net revenue \| Customer risk \| Customer 1
Concentrations
Concentration risk (as a percentage)		73.00%
Total net revenue \| Customer risk \| Customer 2
Concentrations
Concentration risk (as a percentage)	35.00%	11.00%
Total net revenue \| Customer risk \| Customer 3
Concentrations
Concentration risk (as a percentage)	53.00%	12.00%
Total net revenue \| Customer risk \| Minimum \| Customer 1
Concentrations
Concentration risk (as a percentage)	10.00%	10.00%
Total accounts receivable \| Customer risk \| Customer 1
Concentrations
Concentration risk (as a percentage)		16.00%
Total accounts receivable \| Customer risk \| Customer 2
Concentrations
Concentration risk (as a percentage)	38.00%	37.00%
Total accounts receivable \| Customer risk \| Customer 3
Concentrations
Concentration risk (as a percentage)	54.00%	37.00%

Warrants - Additional information (Details) - $ / shares	Dec. 31, 2022	Dec. 31, 2021
Underwriter Warrants
Convertible Promissory Notes and Common Stock Warrants [Line Items]
Exercise price (in dollars per share)	$ 1.47	$ 157.5

Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2022

Stockholders' Equity

Schedule of common reserved shares of common stock for issuance


	December 31,
	2022	2021
Options issued and outstanding	26,533	31,221
Inducement options issued and outstanding	1,546	2,065
Options available for grant under stock option plans	122,978	8,417
Restricted stock unit awards issued and outstanding	44,865	6,499
Warrants issued and outstanding	7,505	7,513
Total	203,427	55,715

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2022

Summary of Significant Accounting Policies

Basis of Presentation

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP").

Principles of Consolidation


	Year Ended
	December 31,
	2022		2021
Customer 1	—	%	73	%
Customer 2	35	%	11	%
Customer 3	53	%	12	%



	December 31,
	2022		2021
Customer 1	—	%	16	%
Customer 2	38	%	37	%
Customer 3	54	%	37	%

party contract manufacturer for the supply of API in Mytesi and a single third-party contract manufacturer as well for the supply of finished products for commercialization.

Other Risks and Uncertainties

Recent Global Events

Silicon Valley Bank (SVB) Failure

Property and Equipment

Software Developed for Internal Use

Long-lived Assets

Long-Lived Assets

Indefinite-lived Intangible Assets

Leases

The Company accounts for its leases in accordance with ASC 842, Leases.

The Company elected to include both the lease and non-lease components as a single component and account for it as a lease.

Research and Development Expense

Clinical Trial Accruals

Revenue Recognition

The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”).

The Company has elected to treat shipping and handling activities as fulfillment costs.

Additionally, the Company elected to record revenue net of sales and other similar taxes.

Contracts and Agreements

Performance obligations

Transaction price

Allocate transaction price

For contracts with Cardinal Health and other distributors, the entire transaction price is allocated to the single performance obligation contained in each contract.

Revenue recognition

Disaggregation of Product Revenue

Human

Animal

Contracts – Specialty Pharmacies

The Company has entered into agreements with a total of five different specialty pharmacy chains that are authorized to provide Mytesi to patients.

Performance obligations

The single performance obligation is the Company’s promise to transfer Mytesi to specialty pharmacies, based on specified payment and shipping terms outlined in the agreements.

Transaction price

Allocate transaction price

The entire transaction price is allocated to the single performance obligation contained in each contract.

Revenue recognition

Product Revenue

Collaboration Revenue

Modifications to Liability-classified Instruments

For the year December 31, 2022, the Company entered into another amendment on the terms of its October 2020 and March 2021 Purchase Agreements (see Note 7).

Modifications to Equity-classified Instruments

The Company did not modify any equity-classified warrants in the year 2022 and 2021.

The Company did not modify any equity-classified preferred stock in the year 2022 and 2021.

Stock-based Compensation

Stock-Based Compensation

Income Taxes

Foreign Currency Remeasurement and Translation

reported separately and accumulated in the consolidated balance sheets as a component of accumulated other comprehensive loss.

Comprehensive Loss

For the years ended December 31, 2022 and 2021, the amount of other comprehensive losses from translation adjustments were $680,000 and zero, respectively.

Basic and Diluted Net Loss Per Common Share

Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Recently Issued Accounting Pronouncements Not Yet Adopted

Summary of Significant Accounting Policies - Comprehensive Loss (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Summary of Significant Accounting Policies
Translation adjustments	$ (680,000)	$ 0

Debt - Streeterville Note (Details)			1 Months Ended	12 Months Ended
Debt - Streeterville Note (Details)	Jan. 13, 2021 USD ($)	Jul. 01, 2020	Jan. 31, 2021	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
Debt
Fair value				$ 7,839,000	$ 7,818,000
Streeterville Note
Debt
Principal amount	$ 6,200,000
Aggregate purchase price	$ 6,000,000.0
Debt term	4 years
Interest rate (as a percent)	3.25%
Percentage of return bonus payable		1
Percentage of reduction in return bonus			1
Term for initiation of human trials			6 months
Percentage of outstanding balance payable elected to prepay				112.5
Capped percentage of aggregate default	25.00%
Fair value	$ 6,000,000.0			$ 7,800,000
Transaction expense				25,000
Net increase in the Fair value recorded as loss				$ 20,000
Streeterville Note \| Maximum
Debt
Interest rate (as a percent)	18.00%
Percentage of gross proceeds received from return				18
Percentage of default effect	15.00%
Streeterville Note \| Minimum
Debt
Interest rate (as a percent)				1.00%
Percentage of default effect	5.00%
Accounts Receivable Purchase Agreement \| Streeterville Note
Debt
Interest rate (as a percent)	25.00%
Transaction fee	$ 25,000

Commitments and Contingencies - Additional details of office space lease (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Commitments and Contingencies
Operating lease - right-of-use asset	$ 1,140	$ 1,084
Operating lease liability, current	483	240
Operating lease liability, net of current portion	725	919
Total	$ 1,208	$ 1,159
Weighted-average remaining life (years)	2 years 4 months 9 days	3 years 2 months 15 days
Weighted-average discount rate	17.89%	21.10%

Fair Value Measurements - Quantitative information about the significant unobservable inputs (Details) - Level 3	12 Months Ended
	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
Discount rate \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Probability (as a percent)	11.53	6.78
Basis point for adjustment of discount rate	1
Fair value increase (decrease)	$ (364,000)
Discount rate \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Probability (as a percent)	26.06	21.31
Basis point for adjustment of discount rate	1
Fair value increase (decrease)	$ 364,000
Discount rate \| Weighted average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Probability (as a percent)	(26.06)	(21.31)
Sale Proceeds \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Amount of comparable TDPRV	$ 67,500,000	$ 67,500,000
Fair value increase (decrease)	(940,000)
Sale Proceeds \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Amount of comparable TDPRV	350,000,000	350,000,000.0
Fair value increase (decrease)	7,230,000
Sale Proceeds \| Weighted average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Amount of comparable TDPRV	$ 100,000,000	$ 100,000,000.0
Timing of Cash Flows \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Probability (as a percent)	0.39	0.35
Fair value increase (decrease)	$ (692,000)
Timing of Cash Flows \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Probability (as a percent)	46.55	46.06
Fair value increase (decrease)	$ 1,510,000

Debt - Insurance Premium Financing (Details) - USD ($)	1 Months Ended				12 Months Ended
Debt - Insurance Premium Financing (Details) - USD ($)	May 31, 2022	Mar. 31, 2022	May 31, 2021	Mar. 31, 2021	Dec. 31, 2022	Dec. 31, 2021
Short-term Debt [Line Items]
Financing balance					$ 6,221,000	$ 6,221,000
Interest expense					12,723,000	8,421,000
March 2021 First Insurance Financing
Short-term Debt [Line Items]
Principal amount				$ 98,000
Unpaid balance				$ 115,000
Interest rate (as a percent)				4.60%
Finance charge				$ 2,000
Interest expense					2,000
Debt term				10 months
Financing balance					0	10,000
May 2021 First Insurance Financing
Short-term Debt [Line Items]
Principal amount			$ 1,100,000
Unpaid balance			$ 1,400,000
Interest rate (as a percent)			4.15%
Finance charge			$ 21,000
Interest expense					6,000	13,000
Debt term			10 months
Financing balance					0	$ 326,000
March 2022 First Insurance Financing
Short-term Debt [Line Items]
Principal amount		$ 100,000
Unpaid balance		$ 115,000
Interest rate (as a percent)		4.60%
Finance charge		$ 15,000
Interest expense					0
Debt term		10 months
Financing balance					9,000
May 2022 First Insurance Financing
Short-term Debt [Line Items]
Principal amount	$ 752,000
Unpaid balance	$ 941,000
Interest rate (as a percent)	4.30%
Finance charge	$ 15,000
Interest expense					4,000
Debt term	10 months
Financing balance					$ 226,000

Summary of Significant Accounting Policies - Inventory (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Summary of Significant Accounting Policies
Allowance for inventory obsolescence	$ 0	$ 0

Summary of Significant Accounting Policies - Other Risks and Uncertainties (Details) - SVB - USD ($) $ in Millions	1 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Deposit Outflow	$ 1,800
Offering aggregate amount	$ 2,250
Interest-Bearing Deposits		$ 0

Income Taxes - Net Operating Loss Carryover (Details) $ in Millions	12 Months Ended
	Dec. 31, 2022 USD ($)
Federal
Net operating loss carryovers
Net operating loss carryovers	$ 96.7
Net operating loss carryforward amount to expire	20.7
Net operating loss carryforward amount that will not expire	114.4
California
Net operating loss carryovers
Net operating loss carryovers	$ 29.4

Income Taxes - Tax Credit Carryover (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2022
Federal
Tax credit carryovers
Reduction In Credit carryforwards	$ 1,400
California
Tax credit carryovers
Reduction In Credit carryforwards	$ 697
Research \| Federal
Tax credit carryovers
Tax credit carryovers		$ 0
Research \| California
Tax credit carryovers
Tax credit carryovers		$ 382