| Components of loss before income taxes |
| |
|
Year ended December 31, |
|
| |
|
2017 |
|
|
2016 |
|
| Domestic (U.S.) |
|
$ |
(5,889,926 |
) |
|
$ |
(12,253,271 |
) |
| Foreign (U.K.) |
|
|
2,398,830 |
|
|
|
(41,837,056 |
) |
| Foreign (Germany) |
|
|
(104,036 |
) |
|
|
(115,779 |
) |
| Loss before income taxes |
|
$ |
(3,595,132 |
) |
|
$ |
(54,206,106 |
) |
|
| Reconciliation of income tax provision (benefit) |
| |
|
Year ended December 31, |
|
| |
|
2017 |
|
|
2016 |
|
| Federal |
|
$ |
(1,222,345 |
) |
|
|
(18,429,763 |
) |
| State |
|
|
(303,315 |
) |
|
|
(455,191 |
) |
| Increase in tax losses not recognized |
|
|
(359,833 |
) |
|
|
9,751,401 |
|
| Permanent differences, net |
|
|
162,543 |
|
|
|
780,836 |
|
| Mark to market |
|
|
– |
|
|
|
992,621 |
|
| Foreign rate differential |
|
|
(383,601 |
) |
|
|
6,923,116 |
|
| Share-based payments, net |
|
|
(22,087 |
) |
|
|
524,131 |
|
| Changes per enacted tax reform |
|
|
2,320,059 |
|
|
|
– |
|
| Enhanced research and development tax credits |
|
|
(191,421 |
) |
|
|
(87,151 |
) |
| Net provision (benefit) for income taxes |
|
$ |
– |
|
|
$ |
– |
|
|
| Schedule of deferred tax assets and liabilities |
| |
|
Year ended December 31, |
|
| |
|
2017 |
|
|
2016 |
|
| Deferred tax assets: |
|
|
|
|
|
|
|
|
| U.K. net operating loss carryforwards |
|
$ |
7,641,719 |
|
|
$ |
6,868,717 |
|
| U.K. capital loss carryforwards |
|
|
1,378,643 |
|
|
|
1,259,062 |
|
| U.S. federal net operating loss carryforwards |
|
|
2,606,017 |
|
|
|
3,061,669 |
|
| IPR&D |
|
|
6,776,473 |
|
|
|
6,630,745 |
|
| Share-based payments |
|
|
1,527,615 |
|
|
|
1,534,992 |
|
| Enhanced research and development tax credits |
|
|
1,060,200 |
|
|
|
796,256 |
|
| Germany net operating loss carryforwards |
|
|
516,401 |
|
|
|
424,432 |
|
| U.S. state net operating loss carryforwards |
|
|
1,057,856 |
|
|
|
749,812 |
|
| Accrued expenses |
|
|
198,067 |
|
|
|
174,424 |
|
| Depreciation |
|
|
1,948 |
|
|
|
3,673 |
|
| Other |
|
|
– |
|
|
|
– |
|
| Total deferred tax assets before valuation allowance |
|
|
22,764,939 |
|
|
|
21,503,782 |
|
| Valuation allowance for deferred tax assets |
|
|
(22,764,939 |
) |
|
|
(21,503,782 |
) |
| Deferred tax liabilities: |
|
|
|
|
|
|
|
|
| Indefinite-lived intangible asset |
|
|
(2,918,518 |
) |
|
|
(2,918,518 |
) |
| Debt discount |
|
|
– |
|
|
|
– |
|
| Total deferred tax liabilities |
|
|
(2,918,518 |
) |
|
|
(2,918,518 |
) |
| Net deferred tax assets and liabilities |
|
$ |
(2,918,518 |
) |
|
$ |
(2,918,518 |
) |
|