GI DYNAMICS, INC., 10-Q filed on 8/7/2020
Quarterly Report
v3.20.2
Document And Entity Information - shares
 6 Months Ended
Jun. 30, 2020
Aug. 01, 2020
Document Information Line Items    
Entity Registrant Name GI DYNAMICS, INC.  
Document Type 10-Q  
Current Fiscal Year End Date --12-31  
Entity Common Stock, Shares Outstanding   75,000,000
Amendment Flag false  
Entity Central Index Key 0001245791  
Entity Current Reporting Status Yes  
Entity Filer Category Non-accelerated Filer  
Document Period End Date Jun. 30, 2020  
Document Fiscal Year Focus 2020  
Document Fiscal Period Focus Q2  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity File Number 000-55195  
Entity Incorporation, State or Country Code DE  
Entity Interactive Data Current Yes  
v3.20.2
Consolidated Balance Sheets (unaudited) - USD ($)
$ in Thousands
Jun. 30, 2020
Dec. 31, 2019
Current assets:    
Cash $ 733 $ 2,499
Restricted cash 30 30
Prepaid expenses and other current assets 3,698 1,230
Total current assets 4,461 3,759
Property and equipment, net 27 42
Operating lease right-of-use assets, net of amortization 316 386
Total assets 4,804 4,187
Current liabilities:    
Accounts payable 901 636
Accrued expenses 1,230 1,353
Short term debt to related party 5,784 5,000
Short term debt, other 195  
Derivative liabilities   10
Short term lease liabilities 171 169
Total current liabilities 8,281 7,168
Long term debt to related party, net of debt discount 2,088  
Long term lease liabilities 145 217
Total liabilities 10,514 7,385
Commitments and contingencies
Stockholders’ deficit:    
Common stock, $0.01 par value – 75,000,000 shares authorized; 36,598,291 shares issued and outstanding 366 366
Additional paid-in capital 284,089 280,928
Accumulated deficit (290,165) (284,492)
Total stockholders’ deficit (5,710) (3,198)
Total liabilities and stockholders’ deficit $ 4,804 $ 4,187
v3.20.2
Consolidated Balance Sheets (unaudited) (Parentheticals) - $ / shares
Jun. 30, 2020
Dec. 31, 2019
Statement of Financial Position [Abstract]    
Common stock, par value (in Dollars per share) $ 0.01 $ 0.01
Common stock, shares authorized 75,000,000 75,000,000
Common stock, shares issued 36,598,291 36,598,291
Common stock, shares outstanding 36,598,291 36,598,291
v3.20.2
Consolidated Statements of Operations (unaudited) - USD ($)
$ in Thousands
 3 Months Ended 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Jun. 30, 2020
Jun. 30, 2019
Operating expenses:        
Research and development $ 858 $ 810 $ 2,031 $ 1,620
Sales and marketing   6   22
General and administrative 1,628 1,393 3,171 2,737
Total operating expenses 2,486 2,209 5,202 4,379
Loss from operations (2,486) (2,209) (5,202) (4,379)
Other income (expense):        
Interest income     3
Interest expense (352) (5,912) (636) (6,089)
Foreign exchange gain (loss) (2) 15 (12) 6
Gain on write-off of accounts payable 61   90
Re-measurement of derivative liabilities (1,687)   (1,688)
Other income 13 187  
Other income (expense), net (341) (7,523) (461) (7,678)
Loss before income taxes (2,827) (9,732) (5,663) (12,057)
Provision for income taxes 5 26 10 32
Net loss $ (2,832) $ (9,758) $ (5,673) $ (12,089)
Basic and diluted net loss per common share (in Dollars per share) $ (0.08) $ (0.51) $ (0.16) $ (0.63)
Weighted-average number of common shares used in basic and diluted net loss per common share (in Shares) 36,598,291 19,277,545 36,598,291 19,277,545
v3.20.2
Consolidated Statements of Changes in Stockholders’ Deficit (unaudited) - USD ($)
$ in Thousands
Common Stock
Common Stock Subscribed but Unissued
Additional Paid-in Capital
Accumulated Deficit
Total
Balance at Dec. 31, 2018 $ 193 $ 263,521 $ (267,159) $ (3,445)
Balance (in Shares) at Dec. 31, 2018 19,277,545        
Reclassification of derivative liabilities to additional paid-in capital upon stockholder approval 5,784 5,784
Conversion of notes payable to related party $ 5,991 5,991
Conversion of notes payable to related party (in Shares)   9,072,197      
2017 Note modification 55 55
Stock-based compensation expense 116 116
Net loss   (12,089) (12,089)
Ending balance at Jun. 30, 2019 $ 193 $ 5,991 269,476 (279,248) (3,588)
Ending balance (in Shares) at Jun. 30, 2019 19,277,545 9,072,197      
Balance at Mar. 31, 2019 $ 193 263,580 (269,490) (5,717)
Balance (in Shares) at Mar. 31, 2019 19,277,545        
Reclassification of derivative liabilities to additional paid-in capital upon stockholder approval 5,784 5,784
Conversion of notes payable to related party $ 5,991   5,991
Conversion of notes payable to related party (in Shares)   9,072,197      
2017 Note modification 55 55
Stock-based compensation expense 57 57
Net loss (9,758) (9,758)
Ending balance at Jun. 30, 2019 $ 193 $ 5,991 269,476 (279,248) (3,588)
Ending balance (in Shares) at Jun. 30, 2019 19,277,545 9,072,197      
Balance at Dec. 31, 2019 $ 366 280,928 (284,492) (3,198)
Balance (in Shares) at Dec. 31, 2019 36,598,291        
Conversion of notes payable to related party        
2017 Note modification        
Relative fair value of warrants and beneficial conversion feature in connection with August 2019 Note 2,765 2,765
Stock-based compensation expense 396 396
Net loss (5,673) (5,673)
Ending balance at Jun. 30, 2020 $ 366 $ 5,991 284,089 (290,165) (5,710)
Ending balance (in Shares) at Jun. 30, 2020 36,598,291 9,072,197      
Balance at Mar. 31, 2020 $ 366 283,905 (287,333) (3,062)
Balance (in Shares) at Mar. 31, 2020 36,598,291        
Stock-based compensation expense 184 184
Net loss (2,832) (2,832)
Ending balance at Jun. 30, 2020 $ 366 $ 5,991 $ 284,089 $ (290,165) $ (5,710)
Ending balance (in Shares) at Jun. 30, 2020 36,598,291 9,072,197      
v3.20.2
Consolidated Statements of Cash Flows (unaudited) - USD ($)
$ in Thousands
 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Operating activities:    
Net loss $ (5,673) $ (12,089)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 15 17
Re-measurement of derivative liabilities 1,688
Reclassification of warrant from derivative liabilities to other income (10)
Non-cash interest expense 633 6,086
Stock-based compensation expense 396 116
Non-cash change in accrued compensation (22)
Changes in operating assets and liabilities:    
Prepaid expenses and other current assets (2,468) (204)
Accounts payable 265 (136)
Accrued expenses (466) (743)
Net cash used in operating activities (7,308) (5,287)
Investing activities    
Purchases of property and equipment (5)
Net cash used in investing activities (5)
Financing activities    
Debt issuance costs (87)
Proceeds from Paycheck Protection Program loan 195
Proceeds from short term and long term debt, related party 5,347 4,000
Net cash provided by financing activities 5,542 3,913
Net decrease in cash (1,766) (1,379)
Cash and restricted cash at beginning of period 2,529 3,836
Cash and restricted cash at end of period 763 2,457
Supplemental disclosures of cash flow information and non-cash activities    
Income taxes paid 10 32
Interest paid 3 394
Warrants issuance recorded to APIC and debt discount 2,330
Beneficial conversion feature discount associated with August 2019 Note 435
Modification of 2017 Note 55
Right-of-use asset obtained in exchange for lease liability 509
Conversion of notes payable to related party 5,991
Reclassification of warrant from derivative liabilities to additional paid-in capital 5,784
Fair value of warrants issued with Notes to Related Party $ 4,072
v3.20.2
Nature of Business
 6 Months Ended
Jun. 30, 2020
Accounting Policies [Abstract]  
Nature of Business

1. Nature of Business


GI Dynamics® is a clinical stage medical device company focused on the development and commercialization of EndoBarrier, a medical device intended to treat patients with type 2 diabetes and to reduce obesity.


Diabetes mellitus type 2 (also known as type 2 diabetes) is a long-term progressive metabolic disorder characterized by high blood sugar, insulin resistance, and reduced insulin production. People with type 2 diabetes represent 90-95% of the worldwide diabetes population; only 5-10% of this population is diagnosed with type 1 diabetes (a form of diabetes mellitus wherein little to no insulin is produced).


Being overweight is a condition where the patient’s BMI is greater than 25 (kg/m2); obesity is a condition where the patient’s BMI is greater than 30. Obesity and its comorbidities contribute to the progression of type 2 diabetes. Many experts believe obesity contributes to higher levels of insulin resistance, which creates a feedback loop that increases the severity of type 2 diabetes.


When considering treatment for type 2 diabetes, it is optimal to address obesity concurrently with diabetes.


EndoBarrier® is intended for the treatment of type 2 diabetes and to reduce obesity in a minimally invasive and reversible manner.


The current treatment paradigm for type 2 diabetes is lifestyle therapy combined with pharmacological treatment, whereby treating clinicians prescribe a treatment regimen of one to four concurrent medications that could include insulin for patients with higher levels of blood sugar. Insulin carries a significant risk of increased mortality and may contribute to weight gain, which in turn may lead to higher levels of insulin resistance and increased levels of blood sugar. Fewer than 50% of patients treated pharmacologically for type 2 diabetes are adequately managed, meaning that medication does not lower blood sugar adequately and does not halt the progressive nature of diabetes of these patients.


The current pharmacological treatment algorithms for type 2 diabetes fall short of ideal, creating a large and unfilled efficacy gap.


The GI Dynamics vision is to make EndoBarrier the essential nonpharmacological and non-anatomy-altering treatment for patients with type 2 diabetes. The Company intends to achieve this vision by providing a safe and effective device, focusing on optimal patient care, supporting treating clinicians, adding to the extensive body of clinical evidence around EndoBarrier, gaining appropriate regulatory approvals, continuing to improve its products and systems, operating the Company in a lean fashion, and maximizing stockholder value.


EndoBarrier® is intended for the treatment of type 2 diabetes and to reduce obesity in a minimally invasive and reversible manner and is designed to mimic the mechanism of action of duodenal-jejunal exclusion created by gastric bypass surgery.


Since incorporation, the Company has devoted substantially all of its efforts to product commercialization, research and development, business planning, recruiting management and technical staff, acquiring operating assets, and raising capital. The Company currently operates in one reportable business segment.


Going Concern Evaluation


As of June 30, 2020, the Company’s primary source of liquidity is its cash and restricted cash balances. GI Dynamics is currently focused primarily on obtaining CE mark approval to allow commercialization in select markets and on conducting its clinical trials which will support future regulatory submissions and potential commercialization activities. Until the Company is successful in gaining regulatory approvals, including CE mark, it is unable to sell the Company’s product in any market at this time. Without revenues, GI Dynamics is reliant on funding obtained from investment in the Company to maintain business operations until the Company can generate positive cash flows from operations. The Company cannot predict the extent of future operating losses and accumulated deficit, and it may never generate sufficient revenues to achieve or sustain profitability.


GI Dynamics has incurred operating losses since inception and at June 30, 2020, had an accumulated deficit of approximately $290 million and a working capital deficit of approximately $3.8 million. The Company expects to incur significant operating losses for the next several years. At June 30, 2020, the Company had approximately $760 thousand in cash and restricted cash.


The Company completed an initial public offering on the Australian Securities Exchange (“ASX”) on September 2, 2011. The Company’s Chess Depository Interests (“CDIs”), which represented 1/50th of a share of the Company’s Common Stock were publicly traded until July 22, 2020, when the Company completed all requirements and was removed from the Official List of the ASX (the “Delisting”, described more fully in Note 10 of the consolidated financial statements). On Delisting, all CDIs were automatically converted to shares of Common Stock with any resulting fractional shares being redeemed by the Company for cash payment. Although the Company is not listed on any public exchange, the Company remains subject to all SEC reporting requirements.


Currently, the Company and Crystal Amber Fund Limited (“Crystal Amber”) have executed a non-binding term sheet for the sale of up to $10 million of shares of Series A Preferred Stock (the “Proposed Offering”) which is expected to close in August or September 2020. Additionally, Crystal Amber has purchased the June 2020 Convertible Note and the August 2020 Convertible Note (together the “2020 Notes”, individually described in detail in Note 8 of the consolidated financial statements) which is expected to fund operations until the anticipated Series A Preferred Stock offering initial close date (the “Initial Close”). On Initial Close, Crystal Amber will provide $5 million, less the 2020 Notes principal balance and any legal fees incurred by Crystal Amber to be paid by the Company in connection with the Proposed Offering. Crystal Amber may sell a portion of the remaining $5 million in the Proposed Offering to additional investors and will purchase any shares of the Proposed Offering that remain unsubscribed by additional investors at October 31, 2020. The Company expects that the cash received in the Proposed Offering will be sufficient to fund the Company’s operations through the later of obtaining of CE mark approval or March 31, 2021, after which additional financing will be required to continue the Company’s operations. Further additional financing will be required to fund operations until the Company achieves sustainably positive cash flow. There can be no assurance that any potential financing opportunities will be available on acceptable terms, if at all. If the Company is unable to raise sufficient capital on the Company’s required timelines and on acceptable terms to stockholders and the Board of Directors, it could be forced to reduce or cease operations that may include activities essential to support regulatory applications to commercialize EndoBarrier, file for bankruptcy, or undertake a combination of the foregoing.


These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that these consolidated financial statements are issued.


The accompanying consolidated financial statements have been prepared assuming GI Dynamics will continue as a going concern, which contemplates the realization of assets and liabilities and commitments in the normal course of business. The accompanying consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from uncertainty related to the Company’s ability to continue as a going concern.
v3.20.2
Significant Accounting Policies and Basis of Presentation
 6 Months Ended
Jun. 30, 2020
Accounting Policies [Abstract]  
Significant Accounting Policies and Basis of Presentation

2. Significant Accounting Policies and Basis of Presentation


The consolidated financial statements and related notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”).  Accordingly, certain information and footnote disclosures normally included in complete financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted pursuant to such rules and regulations.  These interim consolidated financial statements and related notes should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 27, 2020. The Company’s balance sheet at December 31, 2019 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by GAAP for complete financial statements.


In our opinion, the consolidated financial statements included herein contain all adjustments necessary to present fairly our financial position as of June 30, 2020 and the results of our operations and cash flows for the three and six months ended June 30, 2020 and 2019. Such adjustments are of a normal recurring nature. In addition, certain reclassifications of prior period balances have been made to conform to the current period presentation. 


Accounting policy relating to authorized share allocation to outstanding shares and instruments


In determining the sufficiency of the number of shares of common stock authorized by shareholders for issuance, the Company accounts for all issued and outstanding shares of common stock as well as all shares of common stock underlying any convertible or exercisable instruments. In order to determine the sufficiency of authorized shares of common stock, the authorized shares are allotted first to the issued and outstanding shares, then sequentially to any additional relevant instruments in order of decreasing time to maturity or termination. Any instrument that does not have sufficient authorized shares of common stock to allow conversion or exercise is reclassified, if needed, as a liability recorded at fair value until sufficient shares of common stock are authorized, at which time the classification returns to the classification determined in the original accounting analysis of the instrument.


Recently Adopted Accounting Pronouncements


In August 2018, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, or ASU 2018-13, which provides guidance focused on the disclosure requirements for disclosing fair value estimates, assumptions, and methodology. This ASU removed requirements to disclose details around amount and reasoning for level 1 to level 2 transfers, timing policies for transfer between levels and the valuation processes for level 3 fair value measurements. Modified requirements include details regarding net asset redemption restrictions and timing related to uncertainty disclosures. Further, this ASU added required disclosures of changes in unrealized gains and losses for recurring level 3 measurements held as of the reporting date and disclosures around the range and weighted average of significant inputs used to develop level 3 fair value measurements. These amendments are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption was permitted upon issuance of this update, however the Company declined early adoption. The Company adopted this ASU on January 1, 2020 and concluded that it had no impact on its consolidated financial statements.
v3.20.2
Net Loss per Common Share
 6 Months Ended
Jun. 30, 2020
Earnings Per Share [Abstract]  
Net Loss per Common Share

3. Net Loss per Common Share


Basic net loss per common share is computed by dividing net loss by the weighted-average number of shares of Common Stock outstanding during the period. Potential common stock equivalents are determined using the treasury stock method. For diluted net loss per share purposes, stock options and other stock-based awards are excluded, including shares issued as a result of option exercises but which are subject to repurchase by the Company, whose effect would be anti-dilutive from the calculation. For diluted net loss per share purposes, derivatives to purchase shares of common stock or CDIs are treated identically because shares of common stock and CDIs are interchangeable at the sole election of the stockholder. For diluted net loss per share purposes, options and warrants conferring the right to purchase shares of common stock or CDIs are excluded from diluted net loss per share calculations as inclusion would have an anti-dilutive effect. During the three and six months ended June 30, 2020 and 2019, common stock equivalents were excluded from the calculation of diluted net loss per common share, as their effect was anti-dilutive due to the net loss incurred. Therefore, basic and diluted net loss per share was the same in all periods presented.


The following potentially dilutive securities have been excluded from the computation of diluted weighted- average shares outstanding as of June 30, 2020 and 2019, as they would be anti-dilutive:


   Six Months Ended
June 30,		 
   2020   2019 
Warrants to purchase common stock   4,625,425    8,277,081 
Options to purchase common stock and other stock-based awards   3,274,221    1,545,719 
Total   7,899,646    9,822,800 
v3.20.2
Warrants to Purchase Common Stock or CDIs
 6 Months Ended
Jun. 30, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Warrants to Purchase Common Stock or CDIs

4. Warrants to Purchase Common Stock or CDIs


The following series of warrants were outstanding and exercisable at June 30, 2020 and 2019 (warrants to purchase CDIs presented as shares at a 50 CDI per share ratio):


      Number of
underlying		   Exercise
price per		   June 30, 
Warrant Series  Issue Date  shares   share   2020   2019 
Consultant warrant  May 4, 2016   28,532   $0.64    28,532    28,532 
2018 Warrant (1)  May 24, 2018   1,944,444   $0.72    —    1,944,444 
August 2019 Warrant (2)  January 13, 2020   4,596,893   $1.00    4,596,893    — 
March 2019 Warrant  March 15, 2019   1,579,696   $0.64    —    1,579,696 
May 2019 Warrant  May 8, 2019   4,724,409   $0.64    —    4,724,409 
Total Outstanding and Exercisable                4,625,425    8,277,081 
Weighted average exercise price               $1.00   $0.66 

(1)Exercise price was initially $0.90 per share, but was adjusted to $0.72 in November 2018

(2)Financing arranged in August 2019, but funding and the associated issuance of the related warrant did not occur until January 13, 2020

On May 4, 2016, the Company entered into a consulting agreement pursuant to which a consulting firm provides strategic advisory, finance, accounting, human resources and administrative functions, including chief financial officer services, to the Company. In connection with the consulting agreement, the Company granted the consulting firm a warrant (“Consultant Warrant”) to purchase up to 28,532 shares of the Company’s common stock at an exercise price per share equal to $0.64. The Consultant Warrant is fully vested and expires on May 4, 2021. As of June 30, 2020, the Consultant Warrants had not been exercised.


On August 21, 2019, GI Dynamics and Crystal Amber entered into a securities purchase agreement for a total funding of up to approximately $10 million (the “August 2019 SPA”) comprised of the scheduled exercise of the 2018 Warrant, the March 2019 Warrant, and the May 2019 Warrant (totaling 8,248,549 shares of common stock purchased for approximately $5.4 million) and the issue and sale of an Unsecured Convertible Note for up to approximately $4.6 million (the “August 2019 Note”), which included an agreement to issue a warrant (the “August 2019 Warrant”) to purchase up to 229,844,650 CDIs (representing 4,596,893 shares of common stock) for an exercise price of $0.02 per CDI issued on exercise. On December 16, 2019, stockholders approved the issuance of the August 2019 Warrant, which was issued on January 13, 2020 upon funding of the August 2019 Note.
v3.20.2
Fair Value Measurements
 6 Months Ended
Jun. 30, 2020
Fair Value Disclosures [Abstract]  
Fair Value Measurements

5. Fair Value Measurements


Information about the Company’s assets and liabilities that are measured at fair value initially or on a recurring basis as of June 30, 2020 and December 31, 2019 is provided below and includes the fair value hierarchy of the valuation techniques the Company used to determine such fair value. In general, fair values determined by Level 1 inputs utilize observable inputs such as quoted prices in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs utilize data points that are either directly or indirectly observable, such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs utilize unobservable data points in which there is little or no market data, requiring the Company to develop its own assumptions for the asset or liability.


On March 31, 2020, the classification of the Consultant Warrant was re-evaluated, and the Company re-classified it as an equity instrument. On March 31, 2020, this reclassification resulted in a credit to Other Income.


On June 18, 2020, a convertible note was issued to Crystal Amber, the terms of which included a mandatory conversion of outstanding principal and interest into shares issued in the next Qualified Financing, and currently expected to be the Series A Preferred Stock contemplated in the Proposed Financing, at a conversion price equal to 80% of the price per share of Series A Preferred Stock. The fair value of the convertible note was determined using directly observable Level 2 inputs including the time period to the Proposed Offering, accrued interest and the fixed conversion premium. The Company has elected the interest method of accretion to approximate fair value, so the June 2020 Note is not re-measured on a recurring basis.


Cash, restricted cash, prepaid expenses and other current assets, accounts payable, accrued expenses, short-term debt to related party, excluding the June 2020 convertible note, and other current liabilities at June 30, 2020 and December 31, 2019 are carried at amounts that approximate fair value due to their short-term maturities and highly liquid nature of these instruments.
v3.20.2
Concentrations of Credit Risk and Related Valuation Account
 6 Months Ended
Jun. 30, 2020
Concentrations Of Credit Risk Accounts Receivable And Related Valuation Account [Abstract]  
Concentrations of Credit Risk and Related Valuation Account

6. Concentrations of Credit Risk and Related Valuation Account


Financial instruments that subject the Company to credit risk primarily consist of cash and restricted cash. Cash balances are maintained with high quality financial institutions, and consequently, the Company believes that such funds are subject to minimal credit risk. The Company’s short-term investments potentially subject the Company to concentrations of credit risk. GI Dynamics has adopted an investment policy that limits the amounts it may invest in any one type of investment and requires all held investments to hold at least an A rating from a recognized credit rating agency, thereby reducing credit risk concentration.
v3.20.2
Accrued Expenses
 6 Months Ended
Jun. 30, 2020
Payables and Accruals [Abstract]  
Accrued Expenses

7. Accrued Expenses


Accrued expenses consisted of the following (in thousands):


   June 30,   December 31, 
   2020   2019 
Payroll and related liabilities  $362   $531 
Professional fees   162    335 
Credit refunds   —    164 
Interest payable   594    250 
Other   112    73 
Total  $1,230   $1,353 

In 2017, following notification by the Medicines and Healthcare Products Regulatory Agency (“MHRA”), the Company notified its customers to return their inventory on hand. The Company calculated an estimate for returns, reversed its revenue and recorded an accrued expense estimate of $202 thousand of product return related costs in addition to $77 thousand of credit memos granted to customers. Through December 31, 2019, this reserve had various claims and adjustments of $115 thousand. On March 31, 2020, the Company reversed the remaining accrual for $164 thousand and recognized Other Income as the Company concluded that the likelihood that further claims will be made was remote, given the amount of time having lapsed since product expiry, during which the Company has not received any such claims. 


Accrued interest at June 30, 2020 includes interest on the 2017 Note since January 1, 2019, the August 2019 Note since January 13, 2020, and the June 2020 Note since June 18, 2020.
v3.20.2
Notes Payable
 6 Months Ended
Jun. 30, 2020
Debt Disclosure [Abstract]  
Notes Payable

8. Notes Payable


2017 Convertible Note Financing


On June 15, 2017, the Company entered into a Note Purchase Agreement (“2017 NPA”) by and between the Company and Crystal Amber, a Related Party. Pursuant to the 2017 NPA, the Company issued and sold to Crystal Amber, a Senior Secured Convertible Promissory Note in an aggregate original principal amount of $5.0 million (the “2017 Note”).


The 2017 Note accrues interest at an annually compounded rate of 5% per annum, other than during the continuance of an event of default, when the 2017 Note accrues interest at a rate of 8% per annum. The entire outstanding principal balance and all unpaid accrued interest thereon was initially due on the original maturity date of December 31, 2018, and, as announced on July 1, 2020, was most recently amended to extend the maturity date to July 31, 2020.


The 2017 Note is secured by a first priority security interest in substantially all tangible and intangible assets of the Company, including intellectual property (the “Collateral”). In the event of an uncured default, Crystal Amber, is authorized to sell, transfer, assign or otherwise deal in or with the Collateral or the proceeds thereof or any related goods securing the Collateral, as fully and effectually as if Crystal Amber were the absolute owner thereof.


The ASX provided the Company with a waiver to allow all asset liens (the “Security”) to be granted to Crystal Amber, without the customary requirement of having to obtain stockholder approval for the grant of a security to a Related Party of the Company. As a result of the waiver, the Security contains a provision that provides that if an event of default occurs and Crystal Amber exercises its rights under the Security, neither Crystal Amber nor any of its associates can acquire any legal or beneficial interest in an asset of the Company or its subsidiaries in full or partial satisfaction of the Company’s obligations under the Security, or otherwise deal with the assets of the Company or its subsidiaries, without the Company first having complied with any applicable ASX Listing Rules, including ASX Listing Rule 10.1, other than as required by law or through a receiver, manager, or analogous person appointed by Crystal Amber exercising its power of sale under the Security and selling the assets to an unrelated third party on arm’s length commercial terms and conditions and distributing the cash proceeds to Crystal Amber or any of its associates in accordance with their legal entitlements.


The entire outstanding principal balance under the 2017 Note and all unpaid accrued interest thereon is convertible into CDIs (i) prior to the maturity date, at the option of Crystal Amber at a conversion price calculated based on the five-day volume weighted average price of the Company’s CDIs traded on the ASX (“Optional Conversion Price”), or (ii) automatically upon the occurrence of an equity financing in which the Company raises at least $10 million (a “Qualified Financing”) at the price per CDI of the CDIs issued and sold in such financing.


On July 13, 2020, Crystal Amber provided the Company with a notice of optional conversion of the 2017 Note. On the conversion date, the principal of $5 million and the accrued and unpaid interest of $390,240 totaled $5,390,240. The conversion price was based on the 5-day volume weighted average close price (“VWAP”) per CDI for the 5 trading days immediately preceding the date of notice. The price per CDI closed at A$0.003 each day, making the VWAP A$0.003, which equaled $0.002093 per CDI or $0.10467 per share of Common Stock. The Note converted into 2,574,873,400 CDIs, which is equal to 51,497,468 shares of Common Stock.


On receipt of the notice of conversion, the Company did not have sufficient authorized shares to issue to CHESS Depository Nominees, Ltd. (“CDN”) to enable the required number of CDIs to be allotted to Crystal Amber. The available 38,401,704 shares were issued to CDN, allowing the allotment of 1,920,085,200 CDIs to Crystal Amber. The Company and Crystal Amber executed a Right to Shares and Waiver Agreement in which the Company agreed to issue the remaining 13,095,764 shares of Common Stock owed under the conversion when the Company has filed an amended and restated certification of incorporation with the Delaware Secretary of State in connection with the consummation of the Proposed Financing and the Company has been delisted from the ASX. On July 22, 2020, the Company was removed from the Official List of the ASX (“Delisted”) and the CDN trust was subsequently dissolved, causing all CDIs to automatically convert to shares of Common Stock. The additional securities owed under the conversion will be issued as shares of Common Stock.


For the three and six months ended June 30, 2020, the Company recognized interest expense of $65 and $131 thousand, respectively, related to the 2017 Note. For the three and six months ended June 30, 2019, the Company recognized interest expense of $63 and $126 thousand, respectively, related to the 2017 Note as well as interest expense related to the additional debt discount liability of $55 thousand and $55 thousand, respectively.


August 2019 Securities Purchase Agreement


On August 21, 2019, the Company entered into the August 2019 SPA by and between the Company and Crystal Amber. The August 2019 SPA detailed a timeline wherein Crystal Amber would exercise the 2018 Warrant, the March 2019 Warrant, and the May 2019 Warrant. Additionally, pursuant to the August 2019 SPA, the Company issued and sold to Crystal Amber a senior unsecured convertible promissory note in an aggregate principal amount of approximately $4.6 million, or such lesser amount as may be set forth in a notice delivered by the Company to Crystal Amber (the “August 2019 Note”), to be funded on December 6, 2019, or such earlier or later date as may be requested by the Company (the “Funding Date”). In conjunction with the August 2019 Note, the Company agreed to issue to Crystal Amber a Warrant (the “August 2019 Warrant”) to purchase CDIs, subject to the receipt of required stockholder approval approving the issuance of the August 2019 Warrant and the funding of the August 2019 Note (see Note 4).


The August 2019 Note accrues interest at a rate equal to 10% per annum from the August 2019 Note Funding Date, compounded annually, other than during the continuance of an event of default, when the August 2019 Note accrues interest at a rate of 16% per annum. The entire outstanding principal balance and all unpaid accrued interest thereon is due on the fifth anniversary of the Funding Date. The entire outstanding principal balance under the August 2019 Note and all unpaid accrued interest thereon is immediately convertible into CDIs at the option of Crystal Amber at a conversion price equal to US$0.02 per CDI. In the event that the Company issues additional CDIs to a stockholder other than Crystal Amber in a subsequent equity financing at a price per CDI that is less than the conversion price under the August 2019 Note, the conversion price shall be reduced to the lowest such price per CDI. In addition, upon a change of control of the Company resulting in cash proceeds, Crystal Amber may, at its option, demand that the Company prepay all accrued and unpaid interest plus 110% of the remaining outstanding unconverted principal balance. The Company may not prepay the August 2019 Note without the consent of Crystal Amber, a Related Party. If the stockholder approvals required to issue the August 2019 Warrant or to approve the conversion rights under the August 2019 Note are not obtained, the Company is obligated to prepay all accrued and unpaid interest plus 110% of the remaining outstanding unconverted principal balance on the earlier of the Funding Date or the date that is six months following the date of the stockholder meeting at which the requisite approvals were not obtained. The Company considers the change in control premium and the stockholder approval premium to each represent a cash settleable feature, thereby requiring derivative liability classification. On applying a probability adjusted present value of the premiums, the fair value was considered immaterial upon issuance and through the end of this reporting period.


The August 2019 SPA contains customary events of default. If a default occurs and is not cured within the applicable cure period or is not waived, any outstanding obligations under the August 2019 Note may be accelerated. The August 2019 SPA and related August 2019 Note and August 2019 Warrant documents also contain additional representations and warranties, covenants and conditions, in each case customary for transactions of this type.


Prior to December 6, 2019, the Company notified Crystal Amber that it had elected to receive the full amount of approximately $4.6 million under the August 2019 Note, but agreed to timing extensions.


On December 16, 2019, stockholder approval was obtained pursuant to ASX Listing Rule 10.11, for the August 2019 Note conversion feature and the issuance of the August 2019 Warrant, contingent on receipt of the August 2019 Note proceeds.


On January 13, 2020, the full amount of approximately $4.6 million was received as proceeds from the August 2019 Note. On receipt of funds, the August 2019 Note was immediately convertible. On January 13, 2020, the Company issued to Crystal Amber an immediately exercisable August 2019 Warrant to purchase 229,844,650 CDIs (representing 4,596,893 shares of common stock) for an exercise price of $0.02 per CDI (see Note 4).


On issuance, having already obtained the required stockholder approval to reserve the CDIs underlying the conversion feature and the August 2019 Warrant, the August 2019 Warrant was determined to be a freestanding instrument meeting the requirements for equity classification in accordance with ASC 480-10 Distinguishing Liabilities from Equity, ASC 815-40 Contracts in an Entity’s Own Equity and ASC 470-20 Debt with Conversion and Other Options. Accordingly, proceeds from the August 2019 SPA were allocated to the August 2019 Note and Warrant based on their relative fair values. The relative fair value of the August 2019 Warrant of approximately $2.3 million was recorded as a debt discount with the offset to additional paid-in capital. Additionally, the Company analyzed the conversion features of the August 2019 Note to determine whether a beneficial conversion feature (BCF) existed. The Company determined a BCF with a value of $435 thousand existed and was recorded as a debt discount with the offset to additional paid-in capital. The total debt discount will be amortized to interest expense through the January 2025 maturity of the August 2019 Note.


For the three and six months ended June 30, 2020, the Company recorded accrued interest expense of $115 and $213 thousand, respectively, related to the August 2019 Note. For the three and six months ended June 30, 2020, the Company recognized interest expense of $138 and $256 thousand, respectively, from the amortization of the debt discount.


Paycheck Protection Program (“PPP”) Loan


On March 27, 2020, the CARES Act was signed into law in the United States providing economic assistance for American workers and families, small businesses, and preserves jobs for American industries.  On April 4, 2020, GI Dynamics submitted an application to a lending institution for a loan of approximately $200 thousand under the Paycheck Protection Program (“PPP”).  In accordance with the provisions of the PPP, the loan accrues interest at a rate of 1% and all or a portion of the loan may be forgiven if it is used to pay for qualifying costs such as payroll, rent and utilities. Amounts that are not forgiven will be repaid 2 years from the date of the loan. The loan was granted by the lending institution on May 8, 2020 and funds were received into the Company’s bank account on May 11, 2020. The Company believes expenditures of the loan proceeds are fully compliant with the terms for loan forgiveness.


To date, the Company’s lender has been unable to accept forgiveness applications and the Company intends to submit a forgiveness application as soon as the lender is able to receive and process forgiveness applications.


June 2020 Convertible Note


On June 18, 2020, the Company entered into a Note Purchase Agreement (“June 2020 NPA”) by and between the Company and Crystal Amber. Pursuant to the June 2020 NPA, the Company issued and sold to Crystal Amber, a Convertible Promissory Note in an aggregate original principal amount of $750,000 (the “June 2020 Note”).


The June 2020 Note accrues interest at an annually compounded rate of 5% per annum, other than during the continuance of an event of default, when the June 2020 Note accrues interest at a rate of 8% per annum. The entire outstanding principal balance and all unpaid accrued interest thereon becomes immediately due and payable at the sole discretion of Crystal Amber any time after December 18, 2020. The entire outstanding principal balance and all unpaid accrued interest under the June 2020 Note will mandatorily convert at the Initial Close of the Proposed Offering into shares of Series A Preferred Stock at a conversion price equal to 80% of the price per share of Series A Preferred Stock sold in the Proposed Offering.


The Company analyzed the June 2020 Note and its settlement features under ASC 480-10 Distinguishing Liabilities from Equity, and having determined that the predominant settlement feature is the mandatory conversion into shares of Series A Preferred Stock at the close of the Proposed Financing, the June 2020 Note and settlement features should be recorded at fair value as a liability. The Company initially recorded the fair value of the June 2020 Note as the principal value of the Note and will subsequently use the effective interest rate method to accrete the value of the conversion premium, recorded as a debt discount, and nominal interest over the period to expected conversion.


Prior to December 18, 2020, if a Company change of control event generates cash proceeds for the Company, Crystal Amber may, at its option, demand that the Company pay all accrued and unpaid interest plus 110% of the remaining outstanding unconverted principal balance. The Company may not prepay the June 2020 Note without the consent of Crystal Amber.


The Company considers the change in control premium to represent a cash settleable feature, thereby requiring derivative liability classification. On applying a probability adjusted present value of the premiums, the fair value was considered immaterial upon issuance and through the end of this reporting period.


For the three and six months ended June 30, 2020, the Company recorded interest expense of $2 thousand and $34 thousand for amortization of the debt discount.


August 2020 Convertible Note


On August 4, 2020, the Company entered into a Note Purchase Agreement (“August 2020 NPA”) by and between the Company and Crystal Amber. Pursuant to the August 2020 NPA, the Company issued and sold to Crystal Amber, a Convertible Promissory Note in an aggregate original principal amount of $500,000 (the “August 2020 Note”). The Company received $250 thousand on August 3, 2020 and the remaining $250 thousand on August 6, 2020.


The August 2020 Note accrues interest at an annually compounded rate of 5% per annum, other than during the continuance of an event of default, when the June 2020 Note accrues interest at a rate of 8% per annum. The entire outstanding principal balance and all unpaid accrued interest thereon becomes immediately due and payable at the sole discretion of Crystal Amber any time after February 4, 2021. The entire outstanding principal balance and all unpaid accrued interest under the June 2020 Note will mandatorily convert at the Initial Close of the Proposed Offering into shares of Series A Preferred Stock at a conversion price equal to 80% of the price per share of Series A Preferred Stock sold in the Proposed Offering.


The Company analyzed the August 2020 Note and its settlement features under ASC 480-10 Distinguishing Liabilities from Equity, and having determined that the predominant settlement feature is the mandatory conversion into shares of Series A Preferred Stock at the close of the Proposed Financing, the August 2020 Note and settlement features should be recorded at fair value as a liability. The Company initially recorded the fair value of the August 2020 Note as the principal value of the Note and will subsequently use the effective interest rate method to accrete the value of the conversion premium, recorded as a debt discount, and nominal interest over the period to expected conversion.


Prior to February 4, 2021, if a Company change of control event generates cash proceeds for the Company, Crystal Amber may, at its option, demand that the Company pay all accrued and unpaid interest plus 110% of the remaining outstanding unconverted principal balance. The Company may not prepay the August 2020 Note without the consent of Crystal Amber.


The Company considers the change in control premium to represent a cash settleable feature, thereby requiring derivative liability classification. On applying a probability adjusted present value of the premiums, the fair value was considered immaterial upon issuance and through the end of this reporting period.
v3.20.2
Commitments and Contingencies
 6 Months Ended
Jun. 30, 2020
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

9. Commitments and Contingencies


Lease Commitments


In December 2018, the Company entered into a 6-month membership agreement with WeWork for 985 square feet of office space located in Boston, Massachusetts. The committed lease term expired in May 2019. The WeWork agreement contained no explicit or guaranteed extension provisions.


On April 22, 2019, the Company entered into a right-of-use lease for 3,520 square feet of office space in Boston, Massachusetts. The lease period contractually commenced June 1, 2019 and expires on May 31, 2022, but the space was available for occupancy on May 1, 2019 resulting in an effective period of May 2019 through May 2022, with no rent payment assessed in May 2019. The lease has defined escalating rent payments and contains no extension or expansion rights. On lease execution, the Company recorded the approximately $463 thousand present value of the lease liability in short-term and long-term liabilities and recorded a related right-of-use asset. The right-of-use asset will be amortized to lease expense and the liability will be reduced by the rent payments over the term of the lease.


The Company’s leases generally do not provide an implicit interest rate and therefore the Company uses 10% as an estimate of its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease in a similar economic environment. The Company had no leases currently classified as finance leases or previously classified as capital leases in either reporting period.


The Company’s operating lease is reflected in the balance sheets. In the three and six months ended June 30, 2020, $44 and $88 thousand of lease expense was incurred and an additional $7 thousand of tax expense was accrued for property taxes associated with the leased facility. Other information related to leases was as follows (in 2019, other leases were all short term and excluded from the scope of ASC 842, Leases):


   Six Months Ended
June 30,		 
   2020   2019 
   (in thousands) 
Operating cash flows from operating leases in lease liability measurement  $88   $16 
Operating cash flows from short term leases   88    92 
Remaining long-term lease term in years   1.9    2.8 
Discount rate   10%   10%

The maturity of the Company’s operating lease liability as of June 30, 2020 is as follows:


   June 30,
2020		 
   (in thousands) 
2020  $90 
2021   182 
2022   76 
Total future minimum lease payments   348 
Less: imputed interest   32 
Total liabilities  $316 

Rent expense on non-cancelable operating leases was approximately $45 and $90 thousand for the three and six months ended June 30, 2020. Rent expense on non-cancelable operating leases was approximately $55 and $92 thousand for the three and six months ended June 30, 2019.
v3.20.2
Stockholders' Deficit
 6 Months Ended
Jun. 30, 2020
Stockholders' Equity Note [Abstract]  
Stockholders' Deficit

10. Stockholders’ Deficit


On December 19, 2019, GI Dynamics stockholders approved an increase of its authorized shares of common stock from 50 million to 75 million.


As of June 30, 2020, the authorized capital stock of the Company consists of 75.5 million shares, of which 75 million shares are designated as common stock and 500 thousand shares are designated as preferred stock.


On May 26, 2020, the Company filed a definitive proxy statement and Notice of Stockholder Meeting with the Securities and Exchange Commission in the United States and with ASX in Australia. The proposal to be voted by shareholders was to formally apply for removal from the Official List of the ASX (the “Delisting”). On June 20, 2020, stockholders approved the Delisting and notice was given to the market that a formal Delisting application had been submitted to ASX. The Company was not offering any share purchase facilities under the Delisting plan. After a 30-day trading period ending 4:00 p.m. July 22, 2020 Australian Eastern Standard Time, the Company was Delisted. All CDIs were converted to shares of Common Stock before the CDN was dissolved. Registered holders converting CDIs such that a fractional common share is generated will receive cash payment for such fractional share. The Company’s SEC reporting requirements shall still be in effect, even though the Company’s securities are not listed on any exchange.
v3.20.2
Share-Based Compensation
 6 Months Ended
Jun. 30, 2020
Share-based Payment Arrangement [Abstract]  
Share-Based Compensation

11. Share-Based Compensation


The Company has two stock-based compensation plans. The Board of Directors adopted the 2003 Omnibus Stock Plan (the “2003 Plan”), which provides for the grant of qualified incentive stock options and nonqualified stock options or other awards to the Company’s employees, officers, directors, advisors, and outside consultants to purchase up to an aggregate of 922,086 shares of the Company’s common stock.


In August 2011, the Board of Directors adopted the 2011 Employee, Director and Consultant Equity Incentive Plan (the “2011 Plan”, together with the 2003 Plan, the “Plans”) as the successor to the 2003 Plan. Under the 2011 Plan, the Company may grant incentive stock options, nonqualified stock options, restricted and unrestricted stock awards and other stock-based awards. As of June 30, 2020, an additional 554,866 shares of common stock were available for grant under the Company’s 2011 Plan. 


In addition, the 2011 Plan allows for an annual increase in the number of shares available for issue under the 2011 Plan commencing on the first day of each fiscal year during the period beginning in fiscal year 2012 and ending in fiscal year 2020. The annual increase in the number of shares shall be equal to the lowest of:


●500 thousand shares;

●4% of the number of shares of Common Stock outstanding as of such date; and

●an amount determined by the Board of Directors or the Company’s compensation committee. Accordingly, during each of the quarters ended March 31, 2020 and March 31, 2019, 500 thousand shares were added to the 2011 Plan.

Stock-Based Compensation


Stock-based compensation is reflected in the consolidated statements of operations as follows for the three and six months ended June 30, 2020 and 2019 (in thousands):


   Three Months Ended
June 30,		   Six Months Ended
June 30,		 
   2020   2019   2020   2019 
Research and development  $15   $16   $28   $32 
General and administrative   169    41    368    84 
   $184   $57   $396   $116 

The stock options granted under the Plans generally vest over a four-year period and expire ten years from the date of grant.


The weighted-average assumptions used to estimate the fair value of employee stock options using the Black-Scholes option-pricing model were as follows for the three and six months ended June 30, 2020 and 2019:


   Three Months Ended
June 30,		   Six Months Ended
June 30,		 
   2020   2019   2020   2019 
Expected volatility   164.9%   126.1%   164.9%   126.1%
Expected term (in years)   5.84    6.05    5.84    6.05 
Risk-free interest rate   0.9%   1.8%   0.9%   1.8%
Expected dividend yield   0%   0%   0%   0%

Stock Options


The following table summarizes share-based activity under the Company’s stock option plans for the six months ended June 30, 2020:


   Shares of
Common
Stock
Attributable
to Options		   Weighted-
Average
Exercise
Price		   Weighted-
Average
Contractual
Life		   Aggregate
Intrinsic
Value		 
           (in years)   (in thousands) 
Outstanding at December 31, 2019   3,096,154   $1.47    8.3   $— 
Granted   90,000   $0.23    —   $— 
Cancelled   (161,933)  $0.83    —   $— 
Outstanding at June 30, 2020   3,024,221   $1.47    8.4   $— 
Vested or expected to vest at June 30, 2020   3,024,221   $—    —   $— 
Exercisable at June 30, 2020   775,930   $2.74    6.6   $— 

The majority of the Company’s option grants vest 25% on the first anniversary of the grant date, and in a quarterly straight-line rate thereafter until fully vested on the fourth anniversary of the grant date. The weighted average grant date fair value for options granted in the six-month period ended June 30, 2020, was $0.18. The unrecognized stock compensation expense at June 30, 2020 was $1.8 million and was expected to be recognized over a weighted average period of 2.9 years from June 30, 2020.


The Company has recorded non-employee stock-based compensation expense of approximately $1 thousand and $nil during the six-month period ended June 30, 2020 and 2019, respectively, which is included in total stock-based compensation expense. The unrecognized compensation expense associated with outstanding non-employee grants was $2 thousand and $nil at June 30, 2020 and 2019, respectively.


On February 28, 2020, the Company’s Board of Directors approved, subject to stockholder approval per ASX Listing Rule 10.14, the grant of stock options (“NED Options”) conferring the right to purchase up to 30 thousand shares of the Company’s common stock to Praveen Tyle, a non-executive director pursuant to the Company’s 2011 Plan. The exercise price is $0.20 per share of common stock and the NED Options will vest in full on February 28, 2021 if Dr. Tyle remains a director of the Company through that date. The NED Options will vest immediately on a change in control event. The NED Options are immediately exercisable, subject to repurchase rights if purchased prior to vesting. The NED Options will be cancelled immediately upon termination of service as a director, unless such termination is the result of a defined change in control event, in which case the NED Options will be cancelled 12 months after such termination. As of June 30, 2020, stockholders had not yet approved the NED Options.


On February 15, 2020, the Company granted a consultant an option to purchase up to 10 thousand shares of common stock at a price of $0.40 per share. The option vests in equal monthly amounts over a 24-month period and expires in 10 years.


At June 30, 2020, the Company had unvested outstanding options to purchase 7,915 shares of common stock granted to non-employees.


Performance Stock Units


Each performance stock unit (“PSU”) represents a contingent right to receive one share of the Company’s common stock. There is no consideration payable on the vesting of PSUs issued under the Plans. Upon vesting, the PSUs are exercised automatically and settled in shares of the Company’s common stock. During the six months ended June 30, 2020, the Company awarded no PSUs to employees and directors of the Company.


The following table summarizes information related to PSU activity for the six months ended June 30, 2020:


   Number of Units   Weighted-
Average
Contractual
Life		   Aggregate
Intrinsic
Value		 
       (in years)   (in thousands) 
Outstanding at December 31, 2019   250,000    6.23   $149 
Granted   —           
Exercised   —           
Cancelled   —    —    — 
Outstanding at June 30, 2020   250,000    5.73   $25 

The aggregate intrinsic value at June 30, 2020 noted in the table above represents the closing price of the Company’s common stock multiplied by the number of PSUs outstanding. The fair value of each PSU award equals the closing price of the Company’s common stock on the date of grant.


At June 30, 2020, 250 thousand of the PSUs outstanding vest on the achievement of certain milestones. When achievement of the milestone is deemed probable, the Company will expense the compensation of the respective stock award over the implicit service period.


At June 30, 2020, the Company recognized no stock-based compensation related to performance-based vesting of PSUs.


As of June 30, 2020, there was approximately $200 thousand of unrecognized stock-based compensation expense related to non-vested PSU awards that have performance-based vesting.
v3.20.2
Segment Reporting
 6 Months Ended
Jun. 30, 2020
Segment Reporting [Abstract]  
Segment Reporting

12. Segment Reporting


Operating segments are components of an enterprise for which separate financial information is available and is evaluated regularly by the Company’s chief operating decision-maker in deciding how to allocate resources and in assessing performance. The Company has one reportable segment which designs, develops, manufactures and markets medical devices for non-surgical approaches to treating type 2 diabetes and obesity.


Geographic Reporting


The Company has historically reported various geographic segments but does not do so currently as the right-of-use asset of approximately $463 thousand and all long-lived assets, comprised of property and equipment of approximately $27 thousand are all held in the U.S. at June 30, 2020. Additionally, the Company did not have revenue in any geography for the three and six months ended June 30, 2020 and 2019, respectively.


Major Customers


The Company did not recognize any revenue for the three and six months ended June 30, 2020 and 2019, respectively.
v3.20.2
Subsequent Events
 6 Months Ended
Jun. 30, 2020
Subsequent Events [Abstract]  
Subsequent Events

13. Subsequent Events


Material events occurring subsequent to June 30, 2020 detailed within the relevant sections above include the conversion of the 2017 Note and the issuance of the August 2020 Note (both described in Note 8 of the Notes to the Consolidated Financial Statements), and the Company Delisting from the ASX (described in Note 10 of the Notes to the Consolidated Financial Statements).


On July 13,2020, Crystal Amber and the Company entered into a non-binding term sheet that establishes agreement on key terms of the Proposed Financing. Components of the term sheet include, but are not limited to, shareholders authorizing the necessary shares included in the Proposed Financing transaction; Delisting from the Official List of ASX, which occurred on July22, 2020; Exchange or amendment of the August 2019 Convertible Note to new terms and a conversion price per share of Common Stock of 200% of the per share price of the Series A Preferred Stock sold in the Proposed Financing; cancellation of the Warrant issued to Crystal Amber on January 13, 2020 and the Company agreement to negotiate the cancellation of the Consultant Warrant. The non-binding term sheet also addresses certain rights and preferences of the Series A Preferred Stock, including, but not limited to, liquidation preference of 120% of the price paid in the Proposed Financing and subsequent participation on an as-converted basis; automatic 1:1 conversion to shares of Common Stock in the event of a qualified IPO; Board of Director appointment rights, and other terms customary for Preferred Stock in this type of transaction. The ASX announcement outlining the terms of the non-binding term sheet is available on the Company website using the link http://investor.gidynamics.com/investors/financial-information/default.aspx or on the ASX announcement website at https://www.asx.com.au/asxpdf/20200720/pdf/44knm99nrgt4md.pdf


On July 16, 2020, the four then-current members of the Board of Directors of the Company advised the Company of their intent, subsequent to Delisting, to appoint a new member to the Board of Directors, then resign. On July 23, 2020, each member of the Board of Directors submitted a resignation letter to be effective at 5:00 p.m. July 29, 2020. On July 29, prior to 5:00 p.m. each Board member retracted their resignation and withdrew the corresponding resignation letter given that the Board believed that each member should continue to serve for proper corporate governance practices until the definitive documentation for the proposed $10 million Series A Preferred Stock financing is executed.


The intentions to resign are not a result of any dispute or disagreement with the Company or the Board on any matter relating to the operations, policies or practices of the Company.


On July 23, 2020 the Company entered into a Retention Bonus Agreement and Amendment with Scott Schorer, the Company’s Chief Executive Officer, setting forth the terms of Mr. Schorer’s continued employment as CEO through at least December 31, 2020 (the “Retention Period”). In lieu of any severance benefits Mr. Schorer would otherwise be entitled to per the Amended and Restated Offer Letter of September 19, 2019 (the “Offer Letter”), the Company paid Mr. Schorer a one-time cash bonus of approximately $609 thousand, subject to tax withholding (“the Retention Bonus”). The Retention Bonus is subject to pro-rata forfeiture and repayment if Mr. Schorer leaves the Company prior to December 31, 2020, without Good Cause as defined in the Offer Letter or if terminated for Cause. The pro-rata forfeiture and repayment schedule is as follows: (i) termination between August 1, 2020 and August 31, 2020: 5/6 of Retention Bonus to be repaid (i.e., approximately $508 thousand); (ii) termination between September 1, 2020 and September 30, 2020: 4/6 of Retention Bonus to be repaid (i.e., approximately $406 thousand); (iii) termination between October 1, 2020 and October 31, 2020: 3/6 of Retention Bonus to be repaid (i.e., approximately $305 thousand); (iv) termination between November 1, 2020 and November 30, 2020: 2/6 of Retention Bonus to be repaid (i.e., approximately $203 thousand); (v) termination between December 1, 2020 and December 31, 2020: 1/6 of Retention Bonus to be repaid (i.e., approximately $102 thousand); and (vi) termination after December 31, 2020: 0/6 of Retention Bonus to be repaid (i.e., $0.00). Additionally, in lieu of any performance bonus Mr. Schorer may be entitled to per the Offer Letter, Mr. Schorer is eligible for a milestone bonus of up to $100 thousand, subject to tax withholding, for achieving the receipt of European CE mark approval and/or achieving approval of the I-Step clinical trial in India during the Retention Period. If Mr. Schorer’s employment is terminated without cause or if Mr. Schorer resigns for Good Reason as defined in the Offer Letter, and a milestone is subsequently attained, Mr. Schorer will be entitled to a pro-rata portion of the Milestone Bonus based on the percentage of the Retention Period that Mr. Schorer remained employed by the company. Mr. Schorer’s salary will remain at an annualized $450 thousand and should Mr. Schorer continue employment after the Retention Period, the performance bonus provision in the Offer Letter resumes January 1, 2021. In the event Mr. Schorer’s employment is terminated for any reason following the Effective Date of the Retention Bonus Agreement and Amendment, whether voluntarily or involuntarily, then Mr. Schorer will provide consulting services to the Company at a rate of $325 per hour on a part-time basis averaging ten hours per month, subject to adjustment by the parties (the “Consulting Services”), for a period of six months following such termination (the “Consulting Term”), subject to earlier termination by mutual agreement of the parties.
v3.20.2
Accounting Policies, by Policy (Policies)
 6 Months Ended
Jun. 30, 2020
Accounting Policies [Abstract]  
Accounting policy relating to authorized share allocation to outstanding shares and instruments

Accounting policy relating to authorized share allocation to outstanding shares and instruments


In determining the sufficiency of the number of shares of common stock authorized by shareholders for issuance, the Company accounts for all issued and outstanding shares of common stock as well as all shares of common stock underlying any convertible or exercisable instruments. In order to determine the sufficiency of authorized shares of common stock, the authorized shares are allotted first to the issued and outstanding shares, then sequentially to any additional relevant instruments in order of decreasing time to maturity or termination. Any instrument that does not have sufficient authorized shares of common stock to allow conversion or exercise is reclassified, if needed, as a liability recorded at fair value until sufficient shares of common stock are authorized, at which time the classification returns to the classification determined in the original accounting analysis of the instrument.
Recently Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements


In August 2018, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, or ASU 2018-13, which provides guidance focused on the disclosure requirements for disclosing fair value estimates, assumptions, and methodology. This ASU removed requirements to disclose details around amount and reasoning for level 1 to level 2 transfers, timing policies for transfer between levels and the valuation processes for level 3 fair value measurements. Modified requirements include details regarding net asset redemption restrictions and timing related to uncertainty disclosures. Further, this ASU added required disclosures of changes in unrealized gains and losses for recurring level 3 measurements held as of the reporting date and disclosures around the range and weighted average of significant inputs used to develop level 3 fair value measurements. These amendments are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption was permitted upon issuance of this update, however the Company declined early adoption. The Company adopted this ASU on January 1, 2020 and concluded that it had no impact on its consolidated financial statements.
v3.20.2
Net Loss per Common Share (Tables)
 6 Months Ended
Jun. 30, 2020
Earnings Per Share [Abstract]  
Schedule of potentially dilutive securities excluded from computation of diluted weighted average shares
   Six Months Ended
June 30,		 
   2020   2019 
Warrants to purchase common stock   4,625,425    8,277,081 
Options to purchase common stock and other stock-based awards   3,274,221    1,545,719 
Total   7,899,646    9,822,800 
v3.20.2
Warrants to Purchase Common Stock or CDIs (Tables)
 6 Months Ended
Jun. 30, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of warrants outstanding and exercisable
      Number of
underlying		   Exercise
price per		   June 30, 
Warrant Series  Issue Date  shares   share   2020   2019 
Consultant warrant  May 4, 2016   28,532   $0.64    28,532    28,532 
2018 Warrant (1)  May 24, 2018   1,944,444   $0.72    —    1,944,444 
August 2019 Warrant (2)  January 13, 2020   4,596,893   $1.00    4,596,893    — 
March 2019 Warrant  March 15, 2019   1,579,696   $0.64    —    1,579,696 
May 2019 Warrant  May 8, 2019   4,724,409   $0.64    —    4,724,409 
Total Outstanding and Exercisable                4,625,425    8,277,081 
Weighted average exercise price               $1.00   $0.66 
v3.20.2
Accrued Expenses (Tables)
 6 Months Ended
Jun. 30, 2020
Payables and Accruals [Abstract]  
Schedule of Accrued Liabilities
   June 30,   December 31, 
   2020   2019 
Payroll and related liabilities  $362   $531 
Professional fees   162    335 
Credit refunds   —    164 
Interest payable   594    250 
Other   112    73 
Total  $1,230   $1,353 
v3.20.2
Commitments and Contingencies (Tables)
 6 Months Ended
Jun. 30, 2020
Commitments and Contingencies Disclosure [Abstract]  
Schedule of other information related to leases
   Six Months Ended
June 30,		 
   2020   2019 
   (in thousands) 
Operating cash flows from operating leases in lease liability measurement  $88   $16 
Operating cash flows from short term leases   88    92 
Remaining long-term lease term in years   1.9    2.8 
Discount rate   10%   10%
Schedule of maturity of operating lease liability
   June 30,
2020		 
   (in thousands) 
2020  $90 
2021   182 
2022   76 
Total future minimum lease payments   348 
Less: imputed interest   32 
Total liabilities  $316 
v3.20.2
Share-Based Compensation (Tables)
 6 Months Ended
Jun. 30, 2020
Share-based Payment Arrangement [Abstract]  
Schedule of stock-based compensation
   Three Months Ended
June 30,		   Six Months Ended
June 30,		 
   2020   2019   2020   2019 
Research and development  $15   $16   $28   $32 
General and administrative   169    41    368    84 
   $184   $57   $396   $116 
Schedule of weighted-average assumptions used to estimate fair value of employee stock options
   Three Months Ended
June 30,		   Six Months Ended
June 30,		 
   2020   2019   2020   2019 
Expected volatility   164.9%   126.1%   164.9%   126.1%
Expected term (in years)   5.84    6.05    5.84    6.05 
Risk-free interest rate   0.9%   1.8%   0.9%   1.8%
Expected dividend yield   0%   0%   0%   0%
Schedule of share-based activity
   Shares of
Common
Stock
Attributable
to Options		   Weighted-
Average
Exercise
Price		   Weighted-
Average
Contractual
Life		   Aggregate
Intrinsic
Value		 
           (in years)   (in thousands) 
Outstanding at December 31, 2019   3,096,154   $1.47    8.3   $— 
Granted   90,000   $0.23    —   $— 
Cancelled   (161,933)  $0.83    —   $— 
Outstanding at June 30, 2020   3,024,221   $1.47    8.4   $— 
Vested or expected to vest at June 30, 2020   3,024,221   $—    —   $— 
Exercisable at June 30, 2020   775,930   $2.74    6.6   $— 
Schedule of performance stock units activity
   Number of Units   Weighted-
Average
Contractual
Life		   Aggregate
Intrinsic
Value		 
       (in years)   (in thousands) 
Outstanding at December 31, 2019   250,000    6.23   $149 
Granted   —           
Exercised   —           
Cancelled   —    —    — 
Outstanding at June 30, 2020   250,000    5.73   $25 
v3.20.2
Nature of Business (Details)
$ in Thousands
 6 Months Ended
Jun. 30, 2020
USD ($)
Dec. 31, 2019
USD ($)
Nature of Business (Details) [Line Items]    
Types of diabetes population, description Diabetes mellitus type 2 (also known as type 2 diabetes) is a long-term progressive metabolic disorder characterized by high blood sugar, insulin resistance, and reduced insulin production. People with type 2 diabetes represent 90-95% of the worldwide diabetes population; only 5-10% of this population is diagnosed with type 1 diabetes (a form of diabetes mellitus wherein little to no insulin is produced).  
Number of reportable segments 1  
Accumulated deficit $ (290,165) $ (284,492)
Working capital deficit 3,800  
Restricted Cash Equivalents 760  
Non-binding term sheet for the sale 10,000  
Principal balance 5,000  
Proposed Offering to additional investors $ 5,000  
Type 2 Diabetes [Member]    
Nature of Business (Details) [Line Items]    
Types of diabetes population, description Fewer than 50% of patients treated pharmacologically for type 2 diabetes are adequately managed, meaning that medication does not lower blood sugar adequately and does not halt the progressive nature of diabetes of these patients.  
v3.20.2
Net Loss per Common Share (Details) - Schedule of potentially dilutive securities excluded from computation of diluted weighted average shares - shares
 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of diluted weighted-average shares outstanding 7,899,646 9,822,800
Warrants to purchase common stock [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of diluted weighted-average shares outstanding 4,625,425 8,277,081
Options to purchase common stock and other stock-based awards [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of diluted weighted-average shares outstanding 3,274,221 1,545,719
v3.20.2
Warrants to Purchase Common Stock or CDIs (Details) - $ / shares
 1 Months Ended
May 04, 2016
Aug. 21, 2019
Nov. 30, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]      
Exercise price per share $ 0.64   $ 0.90
Exercise price per share adjusted     $ 0.72
Consultant warrant to purchase (in Shares) 28,532    
Warrant expires date May 04, 2021    
Warrants description   GI Dynamics and Crystal Amber entered into a securities purchase agreement for a total funding of up to approximately $10 million (the “August 2019 SPA”) comprised of the scheduled exercise of the 2018 Warrant, the March 2019 Warrant, and the May 2019 Warrant (totaling 8,248,549 shares of common stock purchased for approximately $5.4 million) and the issue and sale of an Unsecured Convertible Note for up to approximately $4.6 million (the “August 2019 Note”), which included an agreement to issue a warrant (the “August 2019 Warrant”) to purchase up to 229,844,650 CDIs (representing 4,596,893 shares of common stock) for an exercise price of $0.02 per CDI issued on exercise. On December 16, 2019, stockholders approved the issuance of the August 2019 Warrant, which was issued on January 13, 2020 upon funding of the August 2019 Note.  
v3.20.2
Warrants to Purchase Common Stock or CDIs (Details) - Schedule of warrants outstanding and exercisable - $ / shares
 6 Months Ended
May 04, 2016
Jun. 30, 2020
Jun. 30, 2019
Nov. 30, 2018
Warrants to Purchase Common Stock or CDIs (Details) - Schedule of warrants outstanding and exercisable [Line Items]        
Number of underlying shares 28,532      
Exercise price per share (in Dollars per share) $ 0.64     $ 0.90
Total Outstanding and Exercisable   4,625,425 8,277,081  
Weighted average exercise price (in Dollars per share)   $ 1.00 $ 0.66  
Consultant Warrant [Member]        
Warrants to Purchase Common Stock or CDIs (Details) - Schedule of warrants outstanding and exercisable [Line Items]        
Issue Date   May 4, 2016    
Number of underlying shares   28,532    
Exercise price per share (in Dollars per share)   $ 0.64    
Total Outstanding and Exercisable   28,532 28,532  
2018 Warrant [Member]        
Warrants to Purchase Common Stock or CDIs (Details) - Schedule of warrants outstanding and exercisable [Line Items]        
Issue Date [1]   May 24, 2018    
Number of underlying shares [1]   1,944,444    
Exercise price per share (in Dollars per share) [1]   $ 0.72    
Total Outstanding and Exercisable [1]   1,944,444  
August 2019 Warrant [Member]        
Warrants to Purchase Common Stock or CDIs (Details) - Schedule of warrants outstanding and exercisable [Line Items]        
Issue Date [2]   January 13, 2020    
Number of underlying shares [2]   4,596,893    
Exercise price per share (in Dollars per share) [2]   $ 1.00    
Total Outstanding and Exercisable [2]   4,596,893  
March 2019 Warrant [Member]        
Warrants to Purchase Common Stock or CDIs (Details) - Schedule of warrants outstanding and exercisable [Line Items]        
Issue Date   March 15, 2019    
Number of underlying shares   1,579,696    
Exercise price per share (in Dollars per share)   $ 0.64    
Total Outstanding and Exercisable     1,579,696  
May 2019 Warrant [Member]        
Warrants to Purchase Common Stock or CDIs (Details) - Schedule of warrants outstanding and exercisable [Line Items]        
Issue Date   May 8, 2019    
Number of underlying shares   4,724,409    
Exercise price per share (in Dollars per share)   $ 0.64    
Total Outstanding and Exercisable     4,724,409  
[1] Exercise price was initially $0.90 per share, but was adjusted to $0.72 in November 2018
[2] Financing arranged in August 2019, but funding and the associated issuance of the related warrant did not occur until January 13, 2020
v3.20.2
Accrued Expenses (Details)
 6 Months Ended
Jun. 30, 2020
Payables and Accruals [Abstract]  
Accrued expenses, description The Company calculated an estimate for returns, reversed its revenue and recorded an accrued expense estimate of $202 thousand of product return related costs in addition to $77 thousand of credit memos granted to customers. Through December 31, 2019, this reserve had various claims and adjustments of $115 thousand. On March 31, 2020, the Company reversed the remaining accrual for $164 thousand and recognized Other Income as the Company concluded that the likelihood that further claims will be made was remote, given the amount of time having lapsed since product expiry, during which the Company has not received any such claims.
v3.20.2
Accrued Expenses (Details) - Schedule of Accrued Liabilities - USD ($)
$ in Thousands
Jun. 30, 2020
Dec. 31, 2019
Schedule of Accrued Liabilities [Abstract]    
Payroll and related liabilities $ 362 $ 531
Professional fees 162 335
Credit refunds   164
Interest payable 594 250
Other 112 73
Total $ 1,230 $ 1,353
v3.20.2
Notes Payable (Details) - USD ($)
 1 Months Ended 3 Months Ended 6 Months Ended 12 Months Ended
Jul. 13, 2020
Apr. 04, 2020
Jan. 13, 2020
Aug. 31, 2019
Jun. 15, 2017
Jun. 30, 2020
Jun. 30, 2019
Jun. 30, 2020
Jun. 30, 2019
Dec. 31, 2017
Aug. 05, 2020
Aug. 04, 2020
Aug. 03, 2020
Jun. 18, 2020
Dec. 06, 2019
Notes Payable (Details) [Line Items]                              
Principle amount       $ 4,600                     $ 4,600
Interest rate during period   1.00%   16.00%                      
Unpaid interest         8.00%                    
Maturity date         Jul. 31, 2020                    
Debt instrument conversion description     On January 13, 2020, the full amount of approximately $4.6 million was received as proceeds from the August 2019 Note. On receipt of funds, the August 2019 Note was immediately convertible. On January 13, 2020, the Company issued to Crystal Amber an immediately exercisable August 2019 Warrant to purchase 229,844,650 CDIs (representing 4,596,893 shares of common stock) for an exercise price of $0.02 per CDI (see Note 4).                        
Fair valiue of warrant       $ 2,300                      
Debt instrument, convertible, beneficial conversion feature       $ 435,000                      
Accrued interest expense           $ 115,000   $ 213,000              
Amortization of debt discount           138   $ 256,000              
Loan amount   $ 200,000                          
Maturity date of loan   2 years                          
Chess Deposit Interest [Member] | 2019 Senior Unsecured Convertible Promissory Note [Member]                              
Notes Payable (Details) [Line Items]                              
Debt instrument conversion description       The entire outstanding principal balance under the August 2019 Note and all unpaid accrued interest thereon is immediately convertible into CDIs at the option of Crystal Amber at a conversion price equal to US$0.02 per CDI.                      
CHESS Depository Nominees, Ltd. [Member]                              
Notes Payable (Details) [Line Items]                              
Debt instrument conversion description               the Company did not have sufficient authorized shares to issue to CHESS Depository Nominees, Ltd. (“CDN”) to enable the required number of CDIs to be allotted to Crystal Amber. The available 38,401,704 shares were issued to CDN, allowing the allotment of 1,920,085,200 CDIs to Crystal Amber. The Company and Crystal Amber executed a Right to Shares and Waiver Agreement in which the Company agreed to issue the remaining 13,095,764 shares of Common Stock owed under the conversion when the Company has filed an amended and restated certification of incorporation with the Delaware Secretary of State in connection with the consummation of the Proposed Financing and the Company has been delisted from the ASX.              
2017 Senior Secured Convertible Promissory Note [Member]                              
Notes Payable (Details) [Line Items]                              
Principle amount         $ 5,000                    
Interest rate during period         5.00%                    
Interest expenses           65,000 $ 63,000 $ 131,000 $ 126,000            
interest expense related to additional debt discount liability           $ 55,000   $ 55,000              
2017 Senior Secured Convertible Promissory Note [Member] | Chess Deposit Interest [Member]                              
Notes Payable (Details) [Line Items]                              
Debt instrument conversion description                   The entire outstanding principal balance under the 2017 Note and all unpaid accrued interest thereon is convertible into CDIs (i) prior to the maturity date, at the option of Crystal Amber at a conversion price calculated based on the five-day volume weighted average price of the Company’s CDIs traded on the ASX (“Optional Conversion Price”), or (ii) automatically upon the occurrence of an equity financing in which the Company raises at least $10 million (a “Qualified Financing”) at the price per CDI of the CDIs issued and sold in such financing.          
Qualified financing least amount raised                   $ 10,000,000          
2019 Senior Unsecured Convertible Promissory Note [Member]                              
Notes Payable (Details) [Line Items]                              
Unpaid interest       10.00%                      
June 2020 Convertible Note [Member]                              
Notes Payable (Details) [Line Items]                              
Unpaid interest           110.00%   110.00%              
Interest expenses           $ 2,000   $ 34,000              
Crystal Amber Fund Limited [Member]                              
Notes Payable (Details) [Line Items]                              
Unpaid interest       110.00%   110.00%   110.00%              
Debt instrument conversion description the Company with a notice of optional conversion of the 2017 Note. On the conversion date, the principal of $5 million and the accrued and unpaid interest of $390,240 totaled $5,390,240. The conversion price was based on the 5-day volume weighted average close price (“VWAP”) per CDI for the 5 trading days immediately preceding the date of notice. The price per CDI closed at A$0.003 each day, making the VWAP A$0.003, which equaled $0.002093 per CDI or $0.10467 per share of Common Stock. The Note converted into 2,574,873,400 CDIs, which is equal to 51,497,468 shares of Common Stock.                            
Series A Preferred Stock [Member] | June 2020 Convertible Note [Member]                              
Notes Payable (Details) [Line Items]                              
Conversion price, percentage               80.00%              
Series A Preferred Stock [Member] | August 2020 Convertible Note [Member]                              
Notes Payable (Details) [Line Items]                              
Conversion price, percentage               80.00%              
Note Purchase Agreement [Member] | June 2020 Convertible Note [Member]                              
Notes Payable (Details) [Line Items]                              
Principle amount                           $ 750,000  
Interest rate during period               8.00%              
Default interest rate               5.00%              
Note Purchase Agreement [Member] | August 2020 Convertible Note [Member]                              
Notes Payable (Details) [Line Items]                              
Principle amount                       $ 500,000,000      
Interest rate during period               8.00%              
Unpaid interest           110.00%   110.00%              
Default interest rate               5.00%              
Debt received amount                         $ 250,000    
Remaining principal amount                     $ 250,000        
v3.20.2
Commitments and Contingencies (Details)
 1 Months Ended 3 Months Ended 6 Months Ended
Apr. 22, 2019
USD ($)
m²
Jun. 30, 2020
USD ($)
Jun. 30, 2019
USD ($)
Jun. 30, 2020
USD ($)
Jun. 30, 2019
USD ($)
Dec. 31, 2018
m²
Commitments and Contingencies Disclosure [Abstract]            
Rentable area of leased premises (in Square Meters) | m² 3,520         985
Operating lease term The lease period contractually commenced June 1, 2019 and expires on May 31, 2022, but the space was available for occupancy on May 1, 2019 resulting in an effective period of May 2019 through May 2022, with no rent payment assessed in May 2019.          
Present value of the lease liability in short-term and long-term liabilities and recorded a related right-of-use asset $ 463,000          
Incremental borrowing rate as discount rate to measure operating lease liabilities   10.00% 10.00% 10.00% 10.00%  
Operating Lease, Expense   $ 44,000   $ 88,000    
Loss Contingency, Discounted Amount of Insurance-related Assessment Liability, Realization Period for Associated Asset Offsets       $7    
Rent expense   $ 45,000 $ 55 $ 90,000    
Operating Leases, Rent Expense         $ 92,000  
v3.20.2
Commitments and Contingencies (Details) - Schedule of other information related to leases - USD ($)
$ in Thousands
 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Schedule of other information related to leases [Abstract]    
Operating cash flows from operating leases in lease liability measurement $ 88 $ 16
Operating cash flows from short term leases $ 88 $ 92
Remaining long-term lease term in years 1 year 328 days 2 years 292 days
Discount rate 10.00% 10.00%
v3.20.2
Commitments and Contingencies (Details) - Schedule of maturity of operating lease liability
$ in Thousands
Jun. 30, 2020
USD ($)
Schedule of maturity of operating lease liability [Abstract]  
2020 $ 90
2021 182
2022 76
Total future minimum lease payments 348
Less: imputed interest 32
Total liabilities $ 316
v3.20.2
Stockholders' Deficit (Details) - shares
Jun. 30, 2020
Dec. 31, 2019
Dec. 19, 2019
Stockholders' Deficit (Details) [Line Items]      
Common stock, shares authorized 75,000,000 75,000,000  
Capital stock, shares authorized 75,500,000    
Preferred stock, shares authorized 500,000    
Minimum [Member]      
Stockholders' Deficit (Details) [Line Items]      
Common stock, shares authorized     50,000,000
Maximum [Member]      
Stockholders' Deficit (Details) [Line Items]      
Common stock, shares authorized     75,000,000
v3.20.2
Share-Based Compensation (Details) - USD ($)
$ / shares in Units, $ in Thousands
 1 Months Ended 6 Months Ended
Feb. 28, 2020
Feb. 15, 2020
Jun. 30, 2020
Jun. 30, 2019
Dec. 31, 2019
Share-Based Compensation (Details) [Line Items]          
Annual increase in number of shares available for grant     500,000    
Percentage of common shares outstanding     4.00%    
Number of shares available for issue, additional shares     500,000    
Stock options vesting period, description     The stock options granted under the Plans generally vest over a four-year period and expire ten years from the date of grant.    
Expire date of grant.     10 years    
Percentage of stock option grants vest     25.00%    
Weighted average grant date fair value (in Dollars per share)     $ 0.18    
Unrecognized compensation expense (in Dollars)     $ 1,800    
Weighted Average Expected Term     2 years 328 days    
Stock-based compensation expense (in Dollars)     $ 396 $ 116  
Options granted     90,000    
Exercise price (in Dollars per share)     $ 0.23    
Company granted option to purchase common stock     3,024,221   3,096,154
Common stock price (in Dollars per share)     $ 1.47   $ 1.47
Option vests expires     8 years 109 days    
Performance stock units outstanding     250,000   250,000
Non Employees Awards [Member]          
Share-Based Compensation (Details) [Line Items]          
Unrecognized compensation expense (in Dollars)     $ 2  
Stock-based compensation expense (in Dollars)     $ 1  
NED Options [Member]          
Share-Based Compensation (Details) [Line Items]          
Options granted 30,000        
Exercise price (in Dollars per share) $ 0.20        
Performance Shares [Member]          
Share-Based Compensation (Details) [Line Items]          
Performance stock units outstanding     250,000    
Performance Stock Units [Member]          
Share-Based Compensation (Details) [Line Items]          
Unrecognized stock based compensation (in Dollars)     $ 200    
2003 Stock Incentive Plan [Member]          
Share-Based Compensation (Details) [Line Items]          
Aggregate shares of the common stock     922,086    
2011 Stock Incentive Plan [Member]          
Share-Based Compensation (Details) [Line Items]          
Shares available for future grants     554,866    
Consultant [Member]          
Share-Based Compensation (Details) [Line Items]          
Company granted option to purchase common stock   10,000      
Common stock price (in Dollars per share)   $ 0.40      
Option vests expires   10 years      
Non Employees [Member]          
Share-Based Compensation (Details) [Line Items]          
Unvested outstanding options to purchase shares of common stock     7,915    
v3.20.2
Share-Based Compensation (Details) - Schedule of stock-based compensation - USD ($)
$ in Thousands
 3 Months Ended 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Jun. 30, 2020
Jun. 30, 2019
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]        
Stock-based compensation expense $ 184 $ 57 $ 396 $ 116
Research and Development Expense [Member]        
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]        
Stock-based compensation expense 15 16 28 32
General and Administrative Expense [Member]        
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]        
Stock-based compensation expense $ 169 $ 41 $ 368 $ 84
v3.20.2
Share-Based Compensation (Details) - Schedule of weighted-average assumptions used to estimate fair value of employee stock options
 3 Months Ended 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Jun. 30, 2020
Jun. 30, 2019
Schedule of weighted-average assumptions used to estimate fair value of employee stock options [Abstract]        
Expected volatility 164.90% 126.10% 164.90% 126.10%
Expected term (in years) 5 years 306 days 6 years 18 days 5 years 306 days 6 years 18 days
Risk-free interest rate 0.90% 1.80% 0.90% 1.80%
Expected dividend yield 0.00% 0.00% 0.00% 0.00%
v3.20.2
Share-Based Compensation (Details) - Schedule of share-based activity
 6 Months Ended
Jun. 30, 2020
USD ($)
$ / shares
shares
Schedule of share-based activity [Abstract]  
Shares of common stock attributable to options, outstanding, beginning balance 3,096,154
Weighted- average exercise price, outstanding, beginning balance (in Dollars per share) | $ / shares $ 1.47
Weighted average contractual life, outstanding, beginning balance 8 years 109 days
Aggregate intrinsic value, outstanding, beginning balance (in Dollars) | $
Shares of common stock attributable to options, granted 90,000
Weighted- average exercise price, outstanding, granted (in Dollars per share) | $ / shares $ 0.23
Weighted average contractual life, outstanding, granted
Aggregate intrinsic value, outstanding, granted (in Dollars) | $
Shares of common stock attributable to options, cancelled (161,933)
Weighted- average exercise price, outstanding, cancelled (in Dollars per share) | $ / shares $ 0.83
Weighted average contractual life, outstanding, cancelled
Aggregate intrinsic value, outstanding, cancelled (in Dollars) | $
Shares of common stock attributable to options, outstanding, ending balance 3,024,221
Weighted- average exercise price, outstanding, ending balance (in Dollars per share) | $ / shares $ 1.47
Weighted average contractual life, outstanding, ending balance 8 years 146 days
Aggregate intrinsic value, outstanding, ending balance (in Dollars) | $
Shares of common stock attributable to options, vested or expected to vest 3,024,221
Shares of common stock attributable to options, exercisable 775,930
Weighted- average exercise price, outstanding, exercisable (in Dollars per share) | $ / shares $ 2.74
Weighted average contractual life, outstanding, exercisable 6 years 219 days
v3.20.2
Share-Based Compensation (Details) - Schedule of performance stock units activity
$ in Thousands
 6 Months Ended
Jun. 30, 2020
USD ($)
shares
Schedule of performance stock units activity [Abstract]  
Number of units, outstanding, beginning balance 250,000
Weighted average contractual life, at beginning of period 6 years 83 days
Outstanding aggregate intrinsic value, beginning balance (in Dollars) | $ $ 149
Number of units, outstanding, ending balance 250,000
Weighted average contractual life, at ending of period 5 years 266 days
Outstanding aggregate intrinsic value, ending balance (in Dollars) | $ $ 25
Number of units, granted
Number of units, exercised
Number of units, cancelled
Weighted average contractual life, cancelled
Aggregate intrinsic value, cancelled (in Dollars) | $
v3.20.2
Segment Reporting (Details)
$ in Thousands
 6 Months Ended
Jun. 30, 2020
USD ($)
Dec. 31, 2019
USD ($)
Segment Reporting (Details) [Line Items]    
Number of reportable segments 1  
Right-of-use-asset $ 316 $ 386
Long-lived assets 27  
UNITED STATES    
Segment Reporting (Details) [Line Items]    
Right-of-use-asset $ 463  
v3.20.2
Subsequent Events (Details) - Subsequent Event [Member]
$ in Millions
 1 Months Ended
Jul. 23, 2020
USD ($)
Subsequent Events (Details) [Line Items]  
Proposed financing cost $ 10
Retention bonus agreement, description In lieu of any severance benefits Mr. Schorer would otherwise be entitled to per the Amended and Restated Offer Letter of September 19, 2019 (the “Offer Letter”), the Company paid Mr. Schorer a one-time cash bonus of approximately $609 thousand, subject to tax withholding (“the Retention Bonus”). The Retention Bonus is subject to pro-rata forfeiture and repayment if Mr. Schorer leaves the Company prior to December 31, 2020, without Good Cause as defined in the Offer Letter or if terminated for Cause. The pro-rata forfeiture and repayment schedule is as follows: (i) termination between August 1, 2020 and August 31, 2020: 5/6 of Retention Bonus to be repaid (i.e., approximately $508 thousand); (ii) termination between September 1, 2020 and September 30, 2020: 4/6 of Retention Bonus to be repaid (i.e., approximately $406 thousand); (iii) termination between October 1, 2020 and October 31, 2020: 3/6 of Retention Bonus to be repaid (i.e., approximately $305 thousand); (iv) termination between November 1, 2020 and November 30, 2020: 2/6 of Retention Bonus to be repaid (i.e., approximately $203 thousand); (v) termination between December 1, 2020 and December 31, 2020: 1/6 of Retention Bonus to be repaid (i.e., approximately $102 thousand); and (vi) termination after December 31, 2020: 0/6 of Retention Bonus to be repaid (i.e., $0.00). Additionally, in lieu of any performance bonus Mr. Schorer may be entitled to per the Offer Letter, Mr. Schorer is eligible for a milestone bonus of up to $100 thousand, subject to tax withholding, for achieving the receipt of European CE mark approval and/or achieving approval of the I-Step clinical trial in India during the Retention Period. If Mr. Schorer’s employment is terminated without cause or if Mr. Schorer resigns for Good Reason as defined in the Offer Letter, and a milestone is subsequently attained, Mr. Schorer will be entitled to a pro-rata portion of the Milestone Bonus based on the percentage of the Retention Period that Mr. Schorer remained employed by the company. Mr. Schorer’s salary will remain at an annualized $450 thousand and should Mr. Schorer continue employment after the Retention Period, the performance bonus provision in the Offer Letter resumes January 1, 2021. In the event Mr. Schorer’s employment is terminated for any reason following the Effective Date of the Retention Bonus Agreement and Amendment, whether voluntarily or involuntarily, then Mr. Schorer will provide consulting services to the Company at a rate of $325 per hour on a part-time basis averaging ten hours per month, subject to adjustment by the parties (the “Consulting Services”), for a period of six months following such termination (the “Consulting Term”), subject to earlier termination by mutual agreement of the parties.