0001564590-20-053577 | 10-Q | XBRL Viewer | Helius Medical Technologies INC

Common Stock and Warrants - Summary of Warrants Accounted for as Liabilities and Recorded as Derivative Financial Instruments (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Fair Value Disclosures [Abstract]
Fair value of warrants at beginning of period	$ 5	$ 13,769
Exercise of warrants		(35)
Foreign exchange losses	(1)	382
Change in fair value of warrants during the period	$ (4)	(14,033)
Fair value of warrants at end of period		$ 83

Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Current assets
Cash	$ 2,680	$ 5,459
Accounts receivable, net	80	210
Other receivables	138	364
Inventory, net	572	598
Prepaid expenses	666	610
Total current assets	4,136	7,241
Property and equipment, net	463	712
Other assets
Goodwill	725	1,242
Intangible assets, net	579	582
Operating lease right-of-use asset, net	105	552
Other assets	18	18
Total other assets	1,427	2,394
TOTAL ASSETS	6,026	10,347
Current liabilities
Accounts payable	720	1,676
Accrued liabilities	1,399	1,519
Operating lease liability	107	172
Derivative financial instruments		5
Deferred revenue	339	430
Total current liabilities	2,565	3,802
Non-current liabilities
Operating lease liability	47	465
Deferred revenue	217	245
TOTAL LIABILITIES	2,829	4,512
Commitments and contingencies (Note 6)
STOCKHOLDERS’ EQUITY
Preferred stock, $0.001 par value; 10,000,000 shares authorized; no shares issued and outstanding as of September 30, 2020 and December 31, 2019
Class A common stock, $0.001 par value; 150,000,000 shares authorized; 45,354,612 and 30,718,554 shares issued and outstanding as of September 30, 2020 and December 31, 2019, respectively	45	31
Additional paid-in capital	120,213	111,479
Accumulated other comprehensive loss	(693)	(902)
Accumulated deficit	(116,368)	(104,773)
TOTAL STOCKHOLDERS’ EQUITY	3,197	5,835
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$ 6,026	$ 10,347

Unaudited Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Total	At-the-Market Program	March 2020 Offering	Common Stock $0.001 par value	Common Stock $0.001 par value At-the-Market Program	Common Stock $0.001 par value March 2020 Offering	Additional Paid-In Capital	Additional Paid-In Capital At-the-Market Program	Additional Paid-In Capital March 2020 Offering	Accumulated Other Comprehensive Loss	Accumulated Deficit
Beginning Balance at Dec. 31, 2018	$ 9,854			$ 26			$ 105,411			$ (591)	$ (94,992)
Beginning Balance, Shares at Dec. 31, 2018				25,827,860
Proceeds from the exercise of stock options and warrants	215						215
Proceeds from exercise of stock options and warrants, Shares				74,720
Settlement of restricted stock units, Shares				964
Reclassification of derivative financial instruments from exercise of warrants	35						35
Stock-based compensation	3,336						3,336
Foreign currency translation adjustments	(168)									(168)
Net loss	(4,450)										(4,450)
Ending Balance at Sep. 30, 2019	8,822			$ 26			108,997			(759)	(99,442)
Ending Balance, Shares at Sep. 30, 2019				25,903,544
Beginning Balance at Jun. 30, 2019	12,782			$ 26			107,437			(827)	(93,854)
Beginning Balance, Shares at Jun. 30, 2019				25,903,544
Stock-based compensation	1,560						1,560
Foreign currency translation adjustments	68									68
Net loss	(5,588)										(5,588)
Ending Balance at Sep. 30, 2019	8,822			$ 26			108,997			(759)	(99,442)
Ending Balance, Shares at Sep. 30, 2019				25,903,544
Beginning Balance at Dec. 31, 2019	5,835			$ 31			111,479			(902)	(104,773)
Beginning Balance, Shares at Dec. 31, 2019				30,718,554
Proceeds from the issuance of common stock		$ 5,043	$ 1,348		$ 8	$ 6		$ 5,035	$ 1,342
Proceeds from the issuance of common stock, Shares					8,138,808	6,257,144
Warrant issuance from the March 2020 Offering			$ 842						$ 842
Share issuance costs	(506)						(506)
Settlement of restricted stock units, Shares				240,106
Stock-based compensation	2,021						2,021
Foreign currency translation adjustments	209									209
Net loss	(11,595)										(11,595)
Ending Balance at Sep. 30, 2020	3,197			$ 45			120,213			(693)	(116,368)
Ending Balance, Shares at Sep. 30, 2020				45,354,612
Beginning Balance at Jun. 30, 2020	6,396			$ 45			119,763			(521)	(112,891)
Beginning Balance, Shares at Jun. 30, 2020				45,114,506
Settlement of restricted stock units, Shares				240,106
Stock-based compensation	450						450
Foreign currency translation adjustments	(172)									(172)
Net loss	(3,477)										(3,477)
Ending Balance at Sep. 30, 2020	$ 3,197			$ 45			$ 120,213			$ (693)	$ (116,368)
Ending Balance, Shares at Sep. 30, 2020				45,354,612

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The condensed consolidated financial statements have also been prepared on a basis substantially consistent with, and should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2019, included in its Annual Report on Form 10-K that was filed with the Securities and Exchange Commission on March 12, 2020. The Company’s reporting currency is the U.S. Dollar (“USD$”).

Use of Estimates

The preparation of the condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and disclosure of contingent assets and liabilities. Significant estimates include the assumptions used in the fair value pricing model for stock-based compensation, derivative financial instruments and deferred income tax asset valuation allowance. Financial statements include estimates which, by their nature, are uncertain. Actual outcomes could differ from these estimates.

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements reflect the operations of Helius Medical Technologies, Inc. and its wholly owned subsidiaries. The usual condition for a controlling financial interest is ownership of a majority of the voting interests of an entity. However, a controlling financial interest may also exist through arrangements that do not involve controlling voting interests. As such, the Company applies the guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810 – Consolidation (“ASC 810”), to determine when an entity that is insufficiently capitalized or not controlled through its voting interests, referred to as a variable interest entity should be consolidated. All intercompany balances and transactions have been eliminated.

Concentrations of Credit Risk

The Company is subject to credit risk with respect to its cash. Amounts invested in such instruments are limited by credit rating, maturity, industry group, investment type and issuer. The Company is not currently exposed to any significant concentrations of credit risk from these financial instruments. The Company seeks to maintain safety and preservation of principal and diversification of risk, liquidity of investments sufficient to meet cash flow requirements and a competitive after-tax rate of return.

Receivables

Accounts receivables are stated at their net realizable value. In determining the appropriate allowance for doubtful accounts, the Company considers a combination of factors, such as the aging of trade receivables, its customers’ financial strength, and payment history. Changes in these factors, among others, may lead to adjustments in the Company’s allowance for doubtful accounts. The calculation of the allowance required judgment by Company management. As of September 30, 2020, the Company’s accounts receivable of $0.1 million, is net of an allowance for doubtful accounts of $0.4 million and is the result of revenue from product sales. As of December 31, 2019, the Company’s accounts receivable of $0.2 million, is net of an allowance for doubtful accounts of $0.2 million and is the result of revenue from product sales.

Other receivables as of September 30, 2020 and December 31, 2019 included refunds from research and development (“R&D”) tax credits of $21 thousand and $0.2 million, respectively, and Goods and Services Tax (“GST”) and Quebec Sales Tax (“QST”) refunds of $0.1 million and $0.1 million, respectively, related to the Company’s Canadian expenditures.

Inventory

The Company’s inventory consists of raw materials, work in progress and finished goods of the PoNS device. Inventory is stated at the lower of cost (average cost method) or net realizable value. Adjustments to reduce the cost of inventory to its net realizable value are made if required. The Company calculates provisions for excess inventory based on inventory on hand compared to anticipated sales or usage. Management uses its judgment to forecast sales or usage and to determine what constitutes a reasonable period. There can be no assurance that the amount ultimately realized for inventories will not be materially different than that assumed in the calculation of the reserves. Inventory markdowns to net realizable value of $0 thousand and $2 thousand were recorded during the three and nine months ended September 30, 2020, respectively. No inventory markdowns to net realizable value were recorded during the three and nine months ended September 30, 2019.

As of September 30, 2020 and December 31, 2019, inventory consisted of the following (amounts in thousands):

	As of			As of
	September 30, 2020			December 31, 2019
Raw materials	$	159		$	144
Work-in-process		446			375
Finished goods		19			129
Inventory	$	624		$	648
Inventory reserve		(52	)		(50	)
Total inventory, net of reserve	$	572		$	598

Property and Equipment

Property and equipment are carried at cost, less accumulated depreciation. Depreciation is recognized using the straight-line method over the useful lives of the related asset or the term of the related lease. Expenditures for maintenance and repairs, which do not improve or extend the expected useful life of the assets, are expensed to operations while major repairs are capitalized. The estimated useful life of the Company’s leasehold improvements is over the shorter of its lease term or useful life of 5 years; the estimated useful life for the Company’s furniture and fixtures is 7 years; and equipment has an estimated useful life of 15 years, while computer software and hardware has an estimated useful life of 3 to 5 years.

As of September 30, 2020 and December 31, 2019, property and equipment consisted of the following (amounts in thousands):

	As of			As of
	September 30, 2020			December 31, 2019
Leasehold improvement	$	64		$	182
Furniture and fixtures		93			247
Equipment		300			286
Computer software and hardware		182			182
Property and equipment		639			897
Less accumulated depreciation		(176	)		(185	)
Property and equipment, net	$	463		$	712

Depreciation expense was $26 thousand and $43 thousand for the three months ended September 30, 2020 and 2019, respectively. Depreciation expense was $92 thousand and $89 thousand for the nine months ended September 30, 2020 and 2019, respectively.

During the second quarter of 2020, the Company sold furniture and fixtures with a net book value of $118 thousand for $61 thousand. Additionally, the Company abandoned leasehold improvements with a net book value of $53 thousand. The loss on the disposal of the furniture and fixtures and leasehold improvements of $110 thousand was recorded as selling, general and administrative expense in the condensed consolidated statements of operations and comprehensive loss.

Business Combinations

Transactions in which the Company obtains control of a business are accounted for according to the acquisition method as described in FASB ASC 805 – Business Combinations. The assets acquired and liabilities assumed are recognized and measured at their fair values as of the date control is obtained. Acquisition related costs in connection with a business combination are expensed as incurred. Contingent consideration is recognized and measured at fair value at the acquisition date and until paid re-measured on a recurring basis. It is classified as a liability based on appropriate GAAP.

On October 30, 2019, the Company and HTC entered into a Share Purchase Agreement (the “SPA”) whereby the Company, through its wholly owned subsidiary, acquired Heuro from HTC. Under the terms of the SPA, total consideration of approximately CAD$2.1 million (USD$1.6 million) was transferred to HTC, which included (1) cash of CAD$0.5 million (USD$0.4 million), (2) delivery of 55 PoNS devices for which the fair value was determined to be CAD$0.5 million (USD$0.4 million), (3) the forgiveness of CAD$750 thousand (USD$0.5 million) receivable from the September 2018 strategic alliance agreement and (4) the exclusivity rights granted to HTC in the Co-Promotion Agreement (as defined below) to provide PoNS Treatment in the Fraser Valley and Vancouver metro regions of British Columbia with a determined fair value of CAD$0.4 million (USD$0.3 million). The transaction has been accounted for as a business combination.

The acquisition related costs were $0.1 million and were accounted for as selling, general and administrative expenses in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2019.

The following table summarizes the recognized fair values of identifiable assets acquired and liabilities assumed as of October 30, 2019:

	October 30, 2019 Fair Value
Assets:
Cash and cash equivalents	$	1
Other receivables		19
Fixed assets		7
Intangibles		1,053
Goodwill		737
Total assets	$	1,817
Liabilities:
Accounts payable	$	186
Other current liabilities		9
Total liabilities	$	195
Net assets acquired	$	1,622

The fair values assigned to identifiable intangible assets assumed were based on management’s estimates and assumptions as of such date and are considered finalized. The Company recorded measurement adjustments of $0.4 million during the nine months ended September 30, 2020, all of which was recorded during the first quarter of 2020. The recorded adjustments related to the recognition of reacquired exclusivity rights.

Acquired intangibles consisted of customer relationships, proprietary technology and reacquired rights. The remaining useful life at acquisition was 1.25 years, 5 years and 3.87 years, respectively, and the acquired intangibles are amortized using the straight-line method.

Factors considered by the Company in determination of goodwill include synergies, strategic fit and other benefits that do not meet the recognition criteria of acquired identifiable intangible assets. The recognized goodwill of $0.7 million is not expected to be deductible for tax purposes.

The fair value of 55 PoNS devices which we agreed to transfer to HTC pursuant to the SPA in the amount of CAD$0.5 million will be recognized as revenue within the consolidated statements of operations and comprehensive loss once control has been transferred in accordance with ASC 606. As of December 31, 2019, the control had not been transferred resulting in the fair value being recorded as deferred revenue on the condensed consolidated balance sheet. As of September 30, 2020, the control of 11 devices had been transferred resulting in recognition of revenue for these devices. The fair value of the remaining 44 devices is still recorded as deferred revenue on the condensed consolidated balance sheet.

In connection with the SPA, on October 30, 2019, the Company entered into a Clinical Research and Co-Promotion Agreement with HTC (the “Co-Promotion Agreement”), whereby each company will promote the sales of the Company’s PoNS Treatment and HTC’s NeuroCatch^TM device throughout Canada. This co-promotion arrangement terminates upon the earlier of the collection of data from 200 patients in Canada and December 31, 2020. Also, subject to certain terms and conditions, Helius granted to HTC the exclusive right to provide the PoNS Treatment in the Fraser Valley and Vancouver metro regions of British Columbia, where HTC has operated a PoNS authorized clinic since February 2019. HTC will purchase the PoNS devices for use in these regions exclusively from the Company and on terms no less favorable than the then-current standard terms and conditions. This exclusivity right has an initial term of ten (10) years, renewable by HTC for one additional ten (10) year term upon sixty (60) days’ written notice to Helius. The Co-Promotion Agreement had a fair value of CAD$360 thousand at the time of acquisition. License revenue will be recognized in connection with the Co-Promotion Agreement ratably over the ten-year term.

Goodwill and Other Intangible Assets

Goodwill represents the excess of purchase price over the fair values underlying net assets acquired in an acquisition. All of the Company’s goodwill as of September 30, 2020 is the result of the Heuro acquisition discussed above. Goodwill is not amortized, but rather will be tested annually for impairment or more frequently if events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. The Company will test goodwill for impairment annually in the fourth quarter of each year using data as of October 1 of that year.

Goodwill is allocated to and evaluated for impairment at the Company’s one identified reporting unit. Goodwill is tested for impairment by either performing a qualitative evaluation or a quantitative test. The qualitative evaluation is an assessment of factors to determine whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount. The Company may elect not to perform the qualitative assessment for its reporting unit and perform the quantitative impairment test. The quantitative goodwill impairment test requires the Company to compare the carrying value of the reporting unit’s net assets to the estimated fair value of the reporting unit.

If the estimated fair value exceeds the carrying value, no further evaluation is required, and no impairment loss is recognized. If the carrying amount of a reporting unit, including goodwill, exceeds the estimated fair value, the excess of the carrying value over the estimated fair value is recorded as an impairment loss, the amount of which is not to exceed the total amount of goodwill allocated to the reporting unit.

The COVID-19 pandemic was a triggering event for testing whether goodwill is impaired. The Company performed quantitative assessments at March 31, 2020, June 30, 2020 and September 30, 2020. As a result of these assessments, the Company determined that the estimated fair value of the reporting unit exceeded the carrying value of the reporting unit. Therefore, the Company concluded that goodwill was not impaired as of any of the aforementioned periods. The Company will continue to monitor the impacts of the COVID-19 pandemic in future periods.

The following is a summary of the activity for the period ended September 30, 2020 for goodwill:

Goodwill	2020
Carrying amount at beginning of period	$	1,242
Business acquisition fair value allocation adjustment		(454	)
Foreign currency translation		(63	)
Carrying amount at end of period	$	725

Definite-lived intangibles consist principally of acquired customer relationships, proprietary software and reacquired rights as well as internally developed software. All are amortized straight-line over their estimated useful lives. Amortization expense related to intangible assets was $0.1 million and $0.3 million during the three and nine months ended September 30, 2020, respectively. No amortization expense related to intangible assets was recorded during the three and nine months ended September 30, 2019. During the nine months ended September 30, 2020, the Company incurred an intangible asset impairment loss of $0.2 million related to the customer relationships, all of which was incurred during the first quarter of 2020, which is included in selling, general and administrative expenses in the accompanying condensed consolidated statement of operations and comprehensive loss.

Intangible assets as of September 30, 2020 and December 31, 2019 consist of the following:

		As of September 30, 2020					As of December 31, 2019
	Useful Life	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Customer relationships	1.25 years	$	227	$	(191	)	$	423	$	(55	)
Acquired proprietary software	5 years		143		(26	)		148		(5	)
Reacquired rights	3.87 years		480		(113	)		—		—
Internally developed software	3 years		82		(23	)		75		(4	)
Total intangible assets		$	932	$	(353	)	$	646	$	(64	)

Amortization expense is anticipated to be as follows in future years:

For the Year Ending December 31,
2020 (remaining 3 months)	$	73
2021		189
2022		176
2023		117
2024		24
	$	579

Leases

On January 1, 2019, the Company adopted ASU No. 2016-02, Leases, using the modified retrospective method. The Company elected the package of practical expedients permitted under the transition guidance within the new standard which allowed the Company to carry forward the historical lease classification. Adoption of this standard resulted in the recording of an operating lease right-of-use (“ROU”) asset and corresponding operating lease liabilities of $0.7 million on January 1, 2019.

The Company does not record an operating lease ROU asset and corresponding lease liability for leases with an initial term of twelve months or less and recognizes lease expense for these leases as incurred over the lease term. The Company had only one operating lease, which was for its headquarters office in Newtown, Pennsylvania upon the adoption date. As of September 30, 2020, the Company has not entered into any additional lease arrangements, but did modify the existing lease arrangement. Operating lease ROU assets and operating lease liabilities are recognized upon the adoption date based on the present value of lease payments over the lease term. The Company does not have a public credit rating and as such used a corporate yield with a “CCC” rating by S&P Capital IQ with a term commensurate with the term of its lease as its incremental borrowing rate in determining the present value of lease payments. Lease expense is recognized on a straight-line basis over the lease term. The Company’s lease arrangement does not have lease and non-lease components which are to be accounted for separately (see Note 6).

Foreign Currency

The Company’s functional currency is the U.S. dollar. Monetary assets and liabilities denominated in foreign currencies are translated into U.S. dollars using exchange rates in effect at the balance sheet date. Opening balances related to non-monetary assets and liabilities are based on prior period translated amounts, and non-monetary assets acquired, and non-monetary liabilities incurred are translated at the approximate exchange rate prevailing at the date of the transaction. Revenue and expense transactions are translated at the approximate exchange rate in effect at the time of the transaction. Foreign exchange gains and losses are included in the condensed consolidated statement of operations and comprehensive loss as foreign exchange (loss) gain.

The functional currency of HMC and HCA, the Company’s Canadian subsidiaries, is the CAD$ and the functional currency of HMI and HNR is the USD$. Transactions in foreign currencies are recorded into the functional currency of the relevant subsidiary at the exchange rate in effect at the date of the transaction. Any monetary assets and liabilities arising from these transactions are translated into the functional currency at exchange rates in effect at the balance sheet date or on settlement. Revenues, expenses and cash flows are translated at the weighted-average rates of exchanges for the reporting period. The resulting currency translation adjustments are not included in the Company’s condensed consolidated statements of operations and comprehensive loss for the reporting period, but rather are accumulated and gains and losses are recorded in foreign exchange (loss) gain, as a component of comprehensive loss, within the condensed consolidated statements of operations and comprehensive loss.

Stock-Based Compensation

The Company accounts for all stock-based payments and awards under the fair value-based method. The Company recognizes its stock-based compensation expense using the straight-line method. Compensation cost is not adjusted for estimated forfeitures, but instead is adjusted upon an actual forfeiture of a stock option.

The Company accounts for the granting of stock options to employees and non-employees using the fair value method whereby all awards are measured at fair value on the date of the grant. The fair value of all employee-related stock options is expensed over the requisite service period with a corresponding increase to additional paid-in capital. Upon exercise of stock options, the consideration paid by the option holder, together with the amount previously recognized in additional paid-in capital is recorded as an increase to common stock, while the par value of the shares received is reclassified from additional paid in capital. Stock options granted to employees are accounted for as liabilities when they contain conditions or other features that are indexed to other than a market, performance or service condition.

In accordance with ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”), stock-based payments to non-employees are measured based on the fair value of the equity instrument issued. Compensation expense for non-employee stock awards is recognized over the requisite service period following the measurement of the fair value on the grant date over the vesting period of the award.

The Company uses the Black-Scholes option pricing model to calculate the fair value of stock options. The use of the Black-Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected term of the option, risk-free interest rates, the value of the common stock and expected dividend yield of the common stock. Changes in these assumptions can materially affect the fair value estimate.

Awards of options that provide for an exercise price that is not denominated in: (a) the currency of a market in which a substantial portion of the Company's equity securities trades, (b) the currency in which the employee's pay is denominated, or (c) the Company's functional currency, are required to be classified as liabilities.

Revenue Recognition

In accordance with the FASB’s ASC 606, Revenue from Contracts with Customers (“ASC 606”), the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to be entitled in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, it performs the following five steps:

(i)	identify the contract(s) with a customer;

(ii)	identify the performance obligations in the contract;

(iii)

determine the transaction price;

(iv)	allocate the transaction price to the performance obligations in the contract; and

(v)	recognize revenue when (or as) the entity satisfies a performance obligation.

The Company applies the five-step model to contracts when it determines that it is probable it will collect substantially all of the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price, after consideration of variability and constraints, if any, that is allocated to the respective performance obligation when the performance obligation is satisfied.

Product Sales, net

During the first half of 2019, product sales were derived from the sale of the PoNS device and certain support services including services from the use of the NeuroCatch^TM device, which is owned by HTC and assesses electroencephalogram brain waves related to cognition of patients participating in the PoNS Treatment at neuroplasticity clinics in Canada. The Company acted in an agency capacity for services performed using the NeuroCatch device and remitted CAD$600 for each patient assessed with the NeuroCatch device. According to the supply agreement with each of these clinics, the Company’s performance obligation was met when it delivered the PoNS device to the clinic’s facility and the clinic assumed title of the PoNS device upon acceptance. As such, revenue is recognized at a point in time. Shipping and handling costs associated with outbound freight before control of a product has been transferred to a customer is accounted for as a fulfillment cost and are included in cost of sales. Further, according to the Company’s arrangement with HTC and Heuro, the Company shared 50/50 with Heuro in fees from support services excluding the CAD$600 payment for an assessment using the NeuroCatch device. For the three and nine months ended September 30, 2019, the Company recorded $0.2 million and $1.3 million, respectively, in product sales net of $0 and $11 thousand, respectively, for HTC’s portion related to services performed using the NeuroCatch device. As described above, the Company modified its arrangement with HTC on October 30, 2019 and product sales were derived from the sale of the PoNS device alone as the NeuroCatch is sold directly to the neuroplasticity clinics in Canada by HTC. For the three and nine months ended September 30, 2020, the Company recorded $0.1 million and $0.4 million, respectively, in product sales. As of September 30, 2020, the control of 11 of the 55 PoNS devices included as consideration in the Heuro acquisition had been transferred resulting in revenue of $0.1 million being recognized which is included in the aforementioned $0.4 million in product sales for the nine months ended September 30, 2020. The fair value of the remaining 44 devices is recorded as deferred revenue of $0.3 million on the condensed consolidated balance sheet. The only returns during the three and nine months ended September 30, 2020 were the result of warranty returns for defective products. These returns were insignificant and any future replacements are expected to be insignificant.

Fee Revenue

During the three and nine months ended September 30, 2020, the Company recognized $0 and $9 thousand, respectively, of fee revenue related to engaging new neuroplasticity clinics to provide the PoNS Treatment. During the three and nine months ended September 30, 2019, the Company recognized $0 and $49 thousand, respectively, of fee revenue associated with the Company’s agreement with HTC and Heuro that entitled the Company to 50% of the franchise fees collected by Heuro from each executed franchise agreement. As of September 30, 2020 and December 31, 2019, the Company had no contract assets or liabilities on its condensed consolidated balance sheets related to the supply agreements with each clinic.

License Revenue

The Company did not record any license revenue during the nine months ended September 30, 2019. As described above, the Company modified its arrangement with HTC on October 30, 2019. License revenue will be recognized ratably over the ten-year term as the performance obligation is met in connection with the Co-Promotion Agreement. During the three and nine months ended September 30, 2020, the Company recognized revenues of $7 thousand and $20 thousand, respectively, in license fees associated with the Co-Promotion Agreement. Revenue not yet recognized of $0.2 million is recorded as deferred revenue on the condensed consolidated balance sheet.

Cost of Sales

Cost of product sales includes the cost to manufacture the PoNS device, royalty expenses, freight charges, customs duties, wages and salaries of employees involved in the management of the supply chain and logistics of fulfilling the Company’s sales orders and certain support services provided by Heuro on the Company’s behalf.

Income Taxes

The Company accounts for income taxes using the asset and liability method. The asset and liability method provide that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

The Company has adopted the provisions of ASC 740 Income Taxes regarding accounting for uncertainty in income taxes. The Company initially recognizes tax positions in the condensed consolidated financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions are initially and subsequently measured as the largest amount of the tax benefit that is greater than 50% likely of being realized upon ultimate settlement with the tax authority, assuming full knowledge of the position and all relevant facts. Application requires numerous estimates based on available information. The Company considers many factors when evaluating and estimating its tax positions and tax benefits. These periodic adjustments may have a material impact on the condensed consolidated statements of operations and comprehensive loss. When applicable, the Company classifies penalties and interest associated with uncertain tax positions as a component of income tax expense in its condensed consolidated statements of operations and comprehensive loss.

On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations, increased limitations on qualified charitable contributions, and technical corrections to tax depreciation methods for qualified improvement property. We continue to examine the impact that the CARES Act may have on our business. Currently, we do not believe the CARES Act will have a material impact on our accounting for income taxes.

Research and Development Expenses

Research and development (“R&D”) expenses consist primarily of personnel costs, including salaries, benefits and stock-based compensation, clinical studies performed by contract research organizations, development and manufacturing of clinical trial devices and devices for manufacturing testing and materials and supplies as well as regulatory costs related to post market surveillance, quality assurance complaint handling and adverse event reporting. R&D costs are charged to operations when they are incurred.

Segment Information

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company operates and manages its business within one operating and reportable segment. Accordingly, the Company reports the accompanying condensed consolidated financial statements in the aggregate in one reportable segment.

Derivative Financial Instruments

The Company evaluates its financial instruments and other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815, Derivatives and Hedging (“ASC 815”). The result of this accounting treatment is that the fair value of the derivative is re-measured at each balance sheet date and recorded as a liability or asset and the change in fair value is recorded in the condensed consolidated statements of operations and comprehensive loss. As of September 30, 2020 and December 31, 2019, the Company’s derivative financial instruments accounted for in accordance with ASC 815 were comprised of warrants issued in connection with both public and/or private securities offerings. Upon settlement of a derivative financial instrument, the instrument is re-measured at the settlement date and the fair value of the underlying instrument is reclassified to equity.

The classification of derivative financial instruments, including whether such instruments should be recorded as liabilities/assets or as equity, is reassessed at the end of each reporting period. Derivative financial instruments that become subject to reclassification are reclassified at the fair value of the instrument on the reclassification date. Derivative financial instruments will be classified in the condensed consolidated balance sheet as current if the right to exercise or settle the derivative financial instrument lies with the holder.

Fair Value Measurements

The Company accounts for financial instruments in accordance with ASC 820, Fair Value Measurements and Disclosures (“ASC 820”). ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC 820 are described below:

Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2 – Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly; and

Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

The Company’s financial instruments recorded in its condensed consolidated balance sheets consist primarily of cash, accounts receivable, other current receivables, operating lease ROU asset, accounts payable, accrued liabilities, operating lease liability and derivative financial instruments. The book values of these instruments, with the exception of derivative financial instruments, non-current lease liability, operating lease ROU asset and non-current receivables approximate their fair values due to the immediate or short-term nature of these instruments.

The Company’s derivative financial instruments are classified as Level 3 within the fair value hierarchy. Unobservable inputs used in the valuation of these financial instruments include volatility of the underlying share price and the expected term. See Note 3 for the inputs used in the Black-Scholes option pricing model as of September 30, 2020 and December 31, 2019 and the roll forward of the Company’s derivative financial instruments. The Company’s derivative financial instruments are comprised of warrants which are classified as liabilities.

The following table summarizes the Company’s recurring fair value measurements for derivative financial instruments and stock-based compensation liability within the fair value hierarchy as of September 30, 2020 and December 31, 2019 (amounts in thousands):

	Fair Value		Level 1		Level 2		Level 3
September 30, 2020
Liabilities:
Derivative financial instruments	$	—		—		—	$	—
December 31, 2019
Liabilities:
Derivative financial instruments	$	5		—		—	$	5

There were no transfers between any levels for any of the periods presented.

In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company's assets and liabilities are also subject to nonrecurring fair value measurements. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges. Due to the COVID-19 pandemic and the related risks and uncertainties, the Company’s customer relationship intangible asset incurred an impairment loss during the nine months ended September 30, 2020 of $0.2 million, all of which was recorded during the first quarter of 2020, and has a remaining net book value of $0.1 million as of September 30, 2020. The fair value of this intangible asset was determined based on Level 3 measurements within the fair value hierarchy. Inputs to these fair value measurements included estimates of the amount and timing of the asset’s net future discounted cash flows based on historical data, current trends and market conditions.

Basic and Diluted Loss per Share

Earnings or loss per share (“EPS”) is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted EPS is computed by dividing net income (loss) by the weighted average of all potentially dilutive shares of common stock that were outstanding during the periods presented.

The treasury stock method is used in calculating diluted EPS for potentially dilutive stock options and share purchase warrants, which assumes that any proceeds received from the exercise of in-the-money stock options and share purchase warrants, would be used to purchase common shares at the average market price for the period, unless including the effects of these potentially dilutive securities would be anti-dilutive.

The basic and diluted loss per share for the periods noted below is as follows (amounts in thousands except shares and per share data):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2020			2019			2020			2019
Basic
Numerator:
Net loss	$	(3,477	)	$	(5,588	)	$	(11,595	)	$	(4,450	)
Denominator:
Weighted average common shares outstanding		45,137,995			25,903,544			39,187,370			25,869,039
Basic net loss per share	$	(0.08	)	$	(0.22	)	$	(0.30	)	$	(0.17	)

Diluted
Numerator:
Net loss, basic	$	(3,477	)	$	(5,588	)	$	(11,595	)	$	(4,450	)
Effect of dilutive securities		—			—			—			—
Net loss, diluted	$	(3,477	)	$	(5,588	)	$	(11,595	)	$	(4,450	)
Denominator:
Weighted average common shares outstanding - basic		45,137,995			25,903,544			39,187,370			25,869,039
Potential common share issuances:
Incremental dilutive shares from equity instruments (treasury stock method)		—			—			—			—
Weighted average common shares outstanding		45,137,995			25,903,544			39,187,370			25,869,039
Diluted net loss per share	$	(0.08	)	$	(0.22	)	$	(0.30	)	$	(0.17	)

The following outstanding securities have been excluded from the computation of diluted weighted shares outstanding for the periods noted below, as they would have been anti-dilutive due to the Company’s losses for the three and nine months ended September 30, 2020 and 2019 and because the exercise price of certain of these outstanding securities was greater than the average closing price of the Company’s common stock.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019
Stock options outstanding		3,929,944		3,629,288		3,929,944		3,629,288
RSUs		5,752		—		5,752		—
Warrants outstanding		9,295,445		3,043,605		9,295,445		3,043,605
Total		13,231,141		6,672,893		13,231,141		6,672,893

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires measurement and recognition of expected credit losses for financial assets held and requires enhanced disclosures regarding significant estimates and judgments used in estimating credit losses. In November 2019, the FASB issued ASU 2019-10, Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815) and Leases (Topic 842): Effective Dates, which amends the effective date of ASU 2016-13. Public business entities that meeting the definition of an SEC filer, excluding entities eligible to be a Smaller Reporting Company (“SRC”) as defined by the SEC, are required to adopt the standard for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. All other entities are required to adopt the standard for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company meets the definition of an SRC and therefore the standard will not be effective until the beginning of 2023. The Company is evaluating the effect that ASU 2016-13 will have on its consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement, which adds disclosure requirements to Topic 820 for the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. This ASU is effective for interim and annual reporting periods beginning after December 15, 2019. The Company adopted this standard as of January 1, 2020 and the adoption did not have a material impact on the Company’s condensed consolidated financial statements.

In November 2018, FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction Between Topic 808 and Topic 606, which, among other things, provides guidance on how to assess whether certain collaborative arrangement transactions should be accounted for under Topic 606. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. The Company adopted this standard on January 1, 2020 and the adoption did not have a material impact on the Company’s condensed consolidated financial statements.

Subsequent Events - Additional Information (Details) - USD ($)			9 Months Ended
	Oct. 26, 2020	Nov. 22, 2019	Sep. 30, 2020	Mar. 23, 2020
Subsequent Event [Line Items]
Common stock per share		$ 0.35
Proceeds from the issuances of common stock and warrants			$ 7,233,000
Minimum
Subsequent Event [Line Items]
Common stock per share				$ 1.00
Subsequent Event \| Private Placement
Subsequent Event [Line Items]
Proceeds from the issuance of common stock, Shares	6,567,868
Warrants to purchase number of common stock, shares	3,283,936
Common stock per share	$ 0.52
Proceeds from the issuances of common stock and warrants	$ 3,400,000
Share issuance cost including placement agent fees	$ 200,000
Warrant exercisable price per share	$ 0.452
Warrants expiration period	3 years
Percentage of right to participate subsequent financing	30.00%
Subsequent Event \| Private Placement \| Minimum
Subsequent Event [Line Items]
Subscription to participate subsequent financing	$ 250,000
Subsequent Event \| Private Placement \| Officer, Affiliates of an Officer and Director
Subsequent Event [Line Items]
Common stock per share	$ 0.5244
Warrant exercisable price per share	$ 0.4619
Subsequent Event \| Private Placement \| Placement Agent
Subsequent Event [Line Items]
Proceeds from the issuance of common stock, Shares	33,654
Common stock per share	$ 0.565
Common Stock
Subsequent Event [Line Items]
Proceeds from the issuance of common stock, Shares		4,815,010
Common Stock \| Subsequent Event \| Private Placement
Subsequent Event [Line Items]
Number of warrant to purchase of each stock	0.50

Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Going Concern Uncertainty

As of September 30, 2020, the Company had cash of $2.7 million. For the nine months ended September 30, 2020, the Company had an operating loss of $11.4 million, and as of September 30, 2020, its accumulated deficit was $116.4 million. For the nine months ended September 30, 2020, the Company had $0.5 million of revenue from the commercial sale of products or services. The Company expects to continue to incur operating losses and net cash outflows until such time as it generates a level of revenue to support its cost structure. There is no assurance that the Company will achieve profitable operations, and, if achieved, whether it will be sustained on a continued basis. These factors indicate substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are filed. The Company’s condensed consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and satisfaction of liabilities in the ordinary course of business; no adjustments have been made relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company not continue as a going concern.

The Company intends to fund ongoing activities by utilizing its current cash on hand, cash received from the sale of its PoNS™ device in Canada and by raising additional capital through equity or debt financings. As discussed further in Note 8, on October 26, 2020, the Company closed a private placement and received net proceeds of approximately $3.2 million. There can be no assurance that the Company will be successful in raising that additional capital or that such capital, if available, will be on terms that are acceptable to the Company. If the Company is unable to raise sufficient additional capital, the Company may be compelled to reduce the scope of its operations and planned capital expenditures.

Risks and Uncertainties

COVID-19

On March 11, 2020, the World Health Organization declared the outbreak of a novel coronavirus (“COVID-19”) as a global pandemic, which continues to spread throughout the United States and around the world. The Company’s business, results of operations and financial condition have been and may continue to be adversely impacted by the COVID-19 pandemic and global economic conditions. The outbreak and spread of COVID-19 has significantly increased economic uncertainty. Authorities implemented numerous measures to try to contain COVID-19, such as travel bans and restrictions, quarantines, shelter in place orders, and business shutdowns. The COVID-19 pandemic initially led to the closure of PoNS Authorized clinic locations across Canada. While all clinics have re-opened, they are all currently operating at reduced capacity, and patients have been and may continue to be less willing to return to these clinics, impacting our commercial activities and our customer engagement efforts. Moreover, the Company’s ability to conduct its ongoing clinical experience programs in Canada has been and may continue to be impaired due to trial participants’ attendance being adversely affected by COVID-19, leading to further delays in the development and approval of the Company’s product candidate. In addition, the COVID-19 pandemic has and may continue to cause delays in the Company’s suppliers’ ability to ship materials that the Company relies upon, and disruptions in business or governmental operations due to COVID-19 may delay the timing for the submission and approval of the Company’s marketing applications with regulatory agencies. Further, the economic impact of the COVID-19 pandemic could affect the Company’s ability to access the public markets and obtain necessary capital in order to properly capitalize and continue its operations.

The extent to which the COVID-19 pandemic will continue to impact the Company’s business, results of operations and financial condition will depend on future developments, which are highly uncertain and cannot be predicted. The Company does not know yet the full extent of the impact of COVID-19 on its business, operations or the global economy as a whole.

Nasdaq Delisting

On March 23, 2020, the Company received a letter (the “Notice”) from the Listing Qualifications staff of Nasdaq indicating that, based on the closing bid price of the Company’s Class A common stock (the “common stock”) for the 30 consecutive business days preceding the Notice, the Company no longer meets the requirement to maintain a minimum bid price of $1.00 per share, as set forth in Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”). The Notice did not result in the immediate delisting of the Company’s common stock from Nasdaq. In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company was provided a period of 180 calendar days in which to regain compliance.

On April 17, 2020, the Company received a second letter (the “Second Notice”) for the Listing Qualifications staff of Nasdaq stating that the 180-day period to regain compliance with the Minimum Bid Price Requirement has been extended due to the global market impact caused by COVID-19. More specifically, Nasdaq has stated that compliance periods were suspended from April 16, 2020 until June 30, 2020. On July 1, 2020, companies received the balance of any pending compliance period to regain compliance with the Minimum Bid Price Requirement. As a result of this extension, the Company was given to until December 3, 2020 to regain compliance with the Minimum Bid Price Requirement. In order to regain compliance with the Minimum Bid Price Requirement, the closing bid price of the Company’s common stock must be at least $1.00 for a minimum of ten consecutive business days.

In the event that the Company does not regain compliance by December 3, 2020, the Company may be eligible to obtain an additional compliance period of 180 calendar days so long as the Company satisfies the continued listing requirement for market value of publicly held shares and all criteria for initial listing on the Nasdaq Capital Market, but for the Minimum Bid Price Requirement and market value of publicly held shares requirement, and provides written notice to Nasdaq of its intent to cure the deficiency during the second compliance period via the implementation of a reverse stock split if necessary. If the Company does not regain compliance with the Minimum Bid Price Requirement by the end of the applicable compliance period (either December 3, 2020 or June 1, 2021 in the event a second compliance period is requested and granted), the Company’s common stock would be subject to delisting from Nasdaq. In that case, however, the Company would have the right to request a hearing before a Nasdaq Hearings Panel to address its plan to remedy the deficiency, which request would stay any delisting action by the Listing Qualifications staff pending the ultimate outcome of the hearing process.

Basis of Presentation

Use of Estimates

Principles of Consolidation

Concentrations of Credit Risk

Receivables

Inventory

As of September 30, 2020 and December 31, 2019, inventory consisted of the following (amounts in thousands):

	As of			As of
	September 30, 2020			December 31, 2019
Raw materials	$	159		$	144
Work-in-process		446			375
Finished goods		19			129
Inventory	$	624		$	648
Inventory reserve		(52	)		(50	)
Total inventory, net of reserve	$	572		$	598

Property and Equipment

As of September 30, 2020 and December 31, 2019, property and equipment consisted of the following (amounts in thousands):

	As of			As of
	September 30, 2020			December 31, 2019
Leasehold improvement	$	64		$	182
Furniture and fixtures		93			247
Equipment		300			286
Computer software and hardware		182			182
Property and equipment		639			897
Less accumulated depreciation		(176	)		(185	)
Property and equipment, net	$	463		$	712

Business Combinations

The following table summarizes the recognized fair values of identifiable assets acquired and liabilities assumed as of October 30, 2019:

	October 30, 2019 Fair Value
Assets:
Cash and cash equivalents	$	1
Other receivables		19
Fixed assets		7
Intangibles		1,053
Goodwill		737
Total assets	$	1,817
Liabilities:
Accounts payable	$	186
Other current liabilities		9
Total liabilities	$	195
Net assets acquired	$	1,622

Goodwill and Other Intangible Assets

The following is a summary of the activity for the period ended September 30, 2020 for goodwill:

Goodwill	2020
Carrying amount at beginning of period	$	1,242
Business acquisition fair value allocation adjustment		(454	)
Foreign currency translation		(63	)
Carrying amount at end of period	$	725

Intangible assets as of September 30, 2020 and December 31, 2019 consist of the following:

		As of September 30, 2020					As of December 31, 2019
	Useful Life	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Customer relationships	1.25 years	$	227	$	(191	)	$	423	$	(55	)
Acquired proprietary software	5 years		143		(26	)		148		(5	)
Reacquired rights	3.87 years		480		(113	)		—		—
Internally developed software	3 years		82		(23	)		75		(4	)
Total intangible assets		$	932	$	(353	)	$	646	$	(64	)

Amortization expense is anticipated to be as follows in future years:

For the Year Ending December 31,
2020 (remaining 3 months)	$	73
2021		189
2022		176
2023		117
2024		24
	$	579

Leases

Foreign Currency

Stock-Based Compensation

Revenue Recognition

(i)	identify the contract(s) with a customer;

(ii)	identify the performance obligations in the contract;

(iii)

determine the transaction price;

(iv)	allocate the transaction price to the performance obligations in the contract; and

(v)	recognize revenue when (or as) the entity satisfies a performance obligation.

Product Sales, net

Fee Revenue

License Revenue

Cost of Sales

Income Taxes

Research and Development Expenses

Segment Information

Derivative Financial Instruments

Fair Value Measurements

Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2 – Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly; and

Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

	Fair Value		Level 1		Level 2		Level 3
September 30, 2020
Liabilities:
Derivative financial instruments	$	—		—		—	$	—
December 31, 2019
Liabilities:
Derivative financial instruments	$	5		—		—	$	5

There were no transfers between any levels for any of the periods presented.

Basic and Diluted Loss per Share

The basic and diluted loss per share for the periods noted below is as follows (amounts in thousands except shares and per share data):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2020			2019			2020			2019
Basic
Numerator:
Net loss	$	(3,477	)	$	(5,588	)	$	(11,595	)	$	(4,450	)
Denominator:
Weighted average common shares outstanding		45,137,995			25,903,544			39,187,370			25,869,039
Basic net loss per share	$	(0.08	)	$	(0.22	)	$	(0.30	)	$	(0.17	)

Diluted
Numerator:
Net loss, basic	$	(3,477	)	$	(5,588	)	$	(11,595	)	$	(4,450	)
Effect of dilutive securities		—			—			—			—
Net loss, diluted	$	(3,477	)	$	(5,588	)	$	(11,595	)	$	(4,450	)
Denominator:
Weighted average common shares outstanding - basic		45,137,995			25,903,544			39,187,370			25,869,039
Potential common share issuances:
Incremental dilutive shares from equity instruments (treasury stock method)		—			—			—			—
Weighted average common shares outstanding		45,137,995			25,903,544			39,187,370			25,869,039
Diluted net loss per share	$	(0.08	)	$	(0.22	)	$	(0.30	)	$	(0.17	)

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019
Stock options outstanding		3,929,944		3,629,288		3,929,944		3,629,288
RSUs		5,752		—		5,752		—
Warrants outstanding		9,295,445		3,043,605		9,295,445		3,043,605
Total		13,231,141		6,672,893		13,231,141		6,672,893

Recent Accounting Pronouncements

Summary of Significant Accounting Policies - Schedule of Inventory (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Raw materials	$ 159	$ 144
Work-in-process	446	375
Finished goods	19	129
Inventory	624	648
Inventory reserve	(52)	(50)
Total inventory, net of reserve	$ 572	$ 598

Accrued Expenses - Additional Information (Details) $ in Millions	Sep. 30, 2020 USD ($)
Chief Executive Officer
Deferred Compensation Arrangement with Individual Share Based Payments [Line Items]
Accrued severance costs	$ 0.5

Summary of Significant Accounting Policies - Additional Information (Details) $ in Thousands			3 Months Ended			9 Months Ended			12 Months Ended
	Oct. 30, 2019 USD ($) Device Patient	Oct. 30, 2019 CAD ($) Device Patient	Sep. 30, 2020 USD ($) Lease	Jun. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2020 USD ($) Device Lease Segment	Sep. 30, 2020 CAD ($) Device Segment	Sep. 30, 2019 USD ($)	Dec. 31, 2019 USD ($)	Oct. 30, 2019 CAD ($)	Jan. 01, 2019 USD ($)
Schedule Of Significant Accounting Policies [Line Items]
Accounts receivable			$ 80,000			$ 80,000			$ 210,000
Allowance for doubtful accounts			400,000			400,000			200,000
Refunds from research and development tax credits			21,000			21,000			200,000
Inventory markdowns to net realizable value			0		$ 0	2,000		$ 0
Depreciation expense			26,000		43,000	92,000		89,000
Proceeds from sale of property and equipment						61,000
Selling, general and administrative			2,370,000		4,291,000	7,625,000		12,715,000
Fair value measurement adjustments						400,000
Business acquisition, goodwill not expected tax deductible amount			700,000			700,000
Revenue			131,000		150,000	470,000		1,344,000
Amortization expense related to intangible assets			72,000			287,000
Intangible asset impairment loss						182,000
Operating lease ROU asset			105,000			105,000			552,000		$ 700,000
Operating lease liabilities			$ 154,000			$ 154,000					$ 700,000
Leases, initial term			12 months			12 months
Number of operating lease \| Lease			1			1
Number of operating segment \| Segment						1	1
Number of reportable segment \| Segment						1	1
Intangible asset, net			$ 579,000			$ 579,000
ASU 2018-13
Schedule Of Significant Accounting Policies [Line Items]
Change in accounting principle, accounting standards update, adopted [true false]			true			true
Change in accounting principle, accounting standards update, adoption date			Jan. 01, 2020			Jan. 01, 2020
Change in accounting principle, accounting standards update, immaterial effect [true false]			true			true
ASU 2018-18
Schedule Of Significant Accounting Policies [Line Items]
Change in accounting principle, accounting standards update, adopted [true false]			true			true
Change in accounting principle, accounting standards update, adoption date			Jan. 01, 2020			Jan. 01, 2020
Change in accounting principle, accounting standards update, immaterial effect [true false]			true			true
Fee Revenue
Schedule Of Significant Accounting Policies [Line Items]
Revenue						$ 9,000		49,000
License Revenue
Schedule Of Significant Accounting Policies [Line Items]
Revenue			$ 7,000			$ 20,000		0
Customer Relationships
Schedule Of Significant Accounting Policies [Line Items]
Intangible asset useful life						1 year 3 months	1 year 3 months
Intangible asset amortization method						straight-line	straight-line
Customer Relationships \| Level 3
Schedule Of Significant Accounting Policies [Line Items]
Intangible asset impairment loss						$ 200,000
Intangible asset, net			100,000			$ 100,000
Proprietary Technology
Schedule Of Significant Accounting Policies [Line Items]
Intangible asset useful life						5 years	5 years
Intangible asset amortization method						straight-line	straight-line
Reacquired Rights
Schedule Of Significant Accounting Policies [Line Items]
Intangible asset useful life						3 years 10 months 13 days	3 years 10 months 13 days
Intangible asset amortization method						straight-line	straight-line
Heuro Canada Incorporation
Schedule Of Significant Accounting Policies [Line Items]
Goodwill impairment loss recognized						$ 0
Heuro Canada Incorporation \| Selling, General and Administrative Expenses
Schedule Of Significant Accounting Policies [Line Items]
Acquisition related costs									100,000
Amortization expense related to intangible assets			100,000		0	300,000		0
Heuro Canada Incorporation \| Selling, General and Administrative Expenses \| Customer Relationships
Schedule Of Significant Accounting Policies [Line Items]
Intangible asset impairment loss						200,000
HealthTech Connex, Inc.
Schedule Of Significant Accounting Policies [Line Items]
Deferred revenue			300,000			300,000
HealthTech Connex, Inc. \| Neurocatch Device
Schedule Of Significant Accounting Policies [Line Items]
Cost of goods sold per device						600,000
HealthTech Connex, Inc. \| Fee Revenue \| Heuro Canada Incorporation
Schedule Of Significant Accounting Policies [Line Items]
Revenue			0		0	$ 9,000		49,000
Percentage of franchise fee revenue						50.00%	50.00%
HealthTech Connex, Inc. \| License Revenue
Schedule Of Significant Accounting Policies [Line Items]
Deferred revenue			200,000			$ 200,000
HealthTech Connex, Inc. \| Strategic Alliance Agreement \| Heuro Canada Incorporation
Schedule Of Significant Accounting Policies [Line Items]
Contract assets			0			0			0
Contract liabilities			0			0			0
HealthTech Connex, Inc. \| Strategic Alliance Agreement \| Neurocatch Device
Schedule Of Significant Accounting Policies [Line Items]
Revenue			100,000		200,000	400,000		1,300,000
HealthTech Connex, Inc. \| Strategic Alliance Agreement \| Services Performed Using Neurocatch Device
Schedule Of Significant Accounting Policies [Line Items]
Revenue					$ 0			$ 11,000
HealthTech Connex, Inc. \| Clinical Research and Co-Promotion Agreement
Schedule Of Significant Accounting Policies [Line Items]
Revenue			7,000			$ 20,000
Number of patients to collect data \| Patient	200	200
Initial term of exclusive right	10 years	10 years
Additional renewal term of exclusive right	10 years	10 years
Written notice period for additional renewal term	60 days	60 days
Acquisition date fair value		$ 360
License revenue agreement term						10 years	10 years
HealthTech Connex, Inc. \| Heuro Canada Incorporation \| Share Purchase Agreement
Schedule Of Significant Accounting Policies [Line Items]
Total consideration amount	$ 1,600,000	2,100
Cash	400,000	$ 500
HealthTech Connex, Inc. \| Heuro Canada Incorporation \| Strategic Alliance Agreement
Schedule Of Significant Accounting Policies [Line Items]
Potential amount receivable	$ 500,000									$ 750
Minimum
Schedule Of Significant Accounting Policies [Line Items]
Effective income tax rate						50.00%	50.00%
Furniture and Fixtures
Schedule Of Significant Accounting Policies [Line Items]
Estimated useful life						7 years	7 years
Sale of property with a net book value				$ 118,000
Proceeds from sale of property and equipment				61,000
Equipment
Schedule Of Significant Accounting Policies [Line Items]
Estimated useful life						15 years	15 years
Computer Software and Hardware \| Minimum
Schedule Of Significant Accounting Policies [Line Items]
Estimated useful life						3 years	3 years
Computer Software and Hardware \| Maximum
Schedule Of Significant Accounting Policies [Line Items]
Estimated useful life						5 years	5 years
Leasehold Improvements
Schedule Of Significant Accounting Policies [Line Items]
Estimated useful life						5 years	5 years
Sale of property with a net book value				53,000
Furniture and Fixtures and Leasehold Improvements
Schedule Of Significant Accounting Policies [Line Items]
Selling, general and administrative				$ 110,000
PoNS
Schedule Of Significant Accounting Policies [Line Items]
Number of devices resulting in recognition of revenue \| Device						11	11
Number of devices recorded as deferred revenue \| Device						44	44
PoNS \| Heuro Canada Incorporation
Schedule Of Significant Accounting Policies [Line Items]
Revenue						$ 100,000
Number of devices resulting in recognition of revenue \| Device						11	11
PoNS \| HealthTech Connex, Inc.
Schedule Of Significant Accounting Policies [Line Items]
Number of devices recorded as deferred revenue \| Device						44	44
PoNS \| HealthTech Connex, Inc. \| Share Purchase Agreement
Schedule Of Significant Accounting Policies [Line Items]
Number of devices \| Device						55	55
Revenue							$ 500
PoNS \| HealthTech Connex, Inc. \| Heuro Canada Incorporation \| Share Purchase Agreement
Schedule Of Significant Accounting Policies [Line Items]
Number of devices \| Device	55	55
Fair value of PoNS	$ 400,000									500
Quebec
Schedule Of Significant Accounting Policies [Line Items]
Other receivables refunds related to goods, services and sales tax			100,000			$ 100,000			100,000
Quebec \| PoNS \| HealthTech Connex, Inc. \| Heuro Canada Incorporation \| Co-Promotion Agreement
Schedule Of Significant Accounting Policies [Line Items]
Fair value of PoNS	$ 300,000									$ 400
Revenue from Product Sales
Schedule Of Significant Accounting Policies [Line Items]
Accounts receivable			$ 100,000			100,000			$ 200,000
Revenue from Product Sales \| Heuro Canada Incorporation
Schedule Of Significant Accounting Policies [Line Items]
Revenue						$ 400,000

Subsequent Events - Schedule of Pro Forma Basis Adjustment on Stockholders' Equity (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Dec. 31, 2018
Subsequent Event [Line Items]
Total stockholders' equity as of September 30, 2020	$ 3,197	$ 6,396	$ 5,835	$ 8,822	$ 12,782	$ 9,854
Net proceeds from October 2020 private placement	3,254
Private Placement \| Pro Forma
Subsequent Event [Line Items]
Total stockholders' equity as of September 30, 2020	$ 6,451

- Definition

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

+ References + Details

Commitments and Contingencies - Schedule of Future Minimum Lease Payments Related to Non-cancellable Operating Lease Commitments (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Dec. 31, 2019	Jan. 01, 2019
Operating Leases Future Minimum Payments Due [Abstract]
Operating lease cost	$ 57
Operating lease - operating cash flows	$ 189
Weighted average remaining lease term	1 year 9 months
Weighted average discount rate	7.20%
2020 (remaining three months)	$ 63
2021	63
2022	32
Total future minimum lease payments	158
Less imputed interest	(4)
Total liability	154		$ 700
Current operating lease liability	107	$ 172
Non-current operating lease liability	47	$ 465
Total	$ 154		$ 700

Stock-Based Payments (Tables)

9 Months Ended

Sep. 30, 2020

Summary of Company's Stock Option Activity

The following is a summary of the Company’s stock option activity during the nine months ended September 30, 2020:

				Weighted			Aggregate
	Number of			Average			Intrinsic Value
	Stock Options			Exercise Price			(in thousands)
Outstanding as of December 31, 2019		3,467,292		$	6.76		$	—
Granted		809,590			0.47			—
Forfeited/Cancelled		(346,938	)		(5.66	)		—
Exercised		—			—			—
Outstanding as of September 30, 2020		3,929,944		$	5.56		$	—
Exercisable as of September 30, 2020		2,449,829		$	4.27		$	—

Summary of Company's Restricted Stock Award Activity

The following is a summary of the Company’s restricted stock award activity for the nine months ended September 30, 2020:

	Number of Restricted Stock Units			Weighted Average Grant Date Fair Value per Unit
Outstanding as of December 31, 2019		27,697		$	0.61
Granted		218,161			0.50
Settled		(240,106	)		0.52
Outstanding as of September 30, 2020		5,752		$	0.39

Summary of Stock-Based Compensation Expense is Classified in Condensed Consolidated Statements of Operations and Comprehensive Loss

Stock-based compensation expense is classified in the Company’s condensed consolidated statements of operations and comprehensive loss as follows (amounts in thousands):

	Three Months Ended September 30,					Nine Months Ended September 30,
	2020		2019			2020			2019
Research and development	$	245	$	233		$	727		$	643
Cost of sales		—		(6	)		(1	)		—
Selling, general and administrative		205		1,333			1,295			2,693
Total	$	450	$	1,560		$	2,021		$	3,336

Employee and Director Stock Options

Estimation Using Black-Scholes Option Pricing Model With Following Weighted Average Assumptions

The weighted average grant date fair value of employee and director stock options granted for the nine months ended September 30, 2020 was $0.30 per option and the grant date fair values of these stock options were estimated using the Black-Scholes option pricing model using the following weighted average assumptions:

	Nine Months Ended September 30, 2020
Stock price	$	0.47
Exercise price	$	0.47
Expected term	5.26 years
Expected volatility		77.35	%
Risk-free interest rate		0.58	%
Dividend rate		0.00	%

Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Related Party Transaction [Line Items]
Accrued liabilities for consulting fees	$ 1,399		$ 1,399		$ 1,519
Directors
Related Party Transaction [Line Items]
Consulting fees paid	0	$ 2	5	$ 25
Accrued liabilities for consulting fees	$ 0		$ 0

Related Party Transactions

9 Months Ended

Sep. 30, 2020

Related Party Transactions

7. RELATED PARTY TRANSACTIONS

During the three and nine months ended September 30, 2020, the Company paid $0 and approximately $5 thousand, respectively, in consulting fees to a director of the Company. During the three and nine months ended September 30, 2019, the Company paid approximately $2 thousand and $25 thousand, respectively, in consulting fees to a director of the Company. As of September 30, 2020, the Company did not have an accrued liability for consulting fees to a director of the Company.

Subsequent Events (Tables)

9 Months Ended

Sep. 30, 2020

Private Placement

Schedule of Pro Forma Basis Adjustment on Stockholders' Equity

The following table sets forth the Company’s total stockholders’ equity as reported as of September 30, 2020 and as adjusted on a pro forma basis to reflect the recently completed private placement (amounts in thousands):

Total stockholders' equity as of September 30, 2020	$	3,197
Net proceeds from October 2020 private placement		3,254
Pro forma total stockholders' equity as of September 30, 2020	$	6,451

Subsequent Events

9 Months Ended

Sep. 30, 2020

Subsequent Events [Abstract]

Subsequent Events

8. SUBSEQUENT EVENTS

On October 26, 2020, the Company closed on a private placement of an aggregate of 6,567,868 shares of common stock and warrants to purchase an aggregate of 3,283,936 shares of common stock at a purchase price of $0.52 per unit, consisting of one share and a warrant to purchase 0.50 shares of common stock, resulting in gross proceeds of approximately $3.4 million, excluding the proceeds, if any, that the Company may receive in the future from the exercise of the warrants. The Company incurred $0.2 million in share issuance costs, including placement agent fees. The warrants have an initial exercise price of $0.452 per share and are exercisable for a period of three years from the date of issuance. The Company also issued warrants to the placement agent to purchase 33,654 shares of common stock, with an exercise price of $0.565 per share. An officer of the Company and affiliates of an officer and director of the Company participated in the private placement on the same terms and conditions as all other purchasers, except that they paid $0.5244 per unit and their warrants have an exercise price of $0.4619 per share.

Pursuant to the securities purchase agreement for the private placement, if the Company issues any shares of common stock or common stock equivalents for cash consideration, indebtedness or a combination thereof, with certain exceptions, within twelve months of the closing of the private placement, each purchaser who subscribed for at least $250,000 has the right to participate in up to such purchaser’s pro rata portion of 30% of the such subsequent financing on the same terms, conditions and price provided for in the subsequent financing.

Total stockholders' equity as of September 30, 2020	$	3,197
Net proceeds from October 2020 private placement		3,254
Pro forma total stockholders' equity as of September 30, 2020	$	6,451

Stock-Based Payments - Summary of Company's Stock Option Activity (Details)	9 Months Ended
	Sep. 30, 2020 $ / shares shares
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Number of Stock Options, Beginning balance outstanding \| shares	3,467,292
Number of Stock Options, Granted \| shares	809,590
Number of Stock Options Forfeited/Cancelled \| shares	(346,938)
Number of Stock Options, Ending balance outstanding \| shares	3,929,944
Number of Stock Options, Exercisable \| shares	2,449,829
Weighted Average Exercise Price, Beginning balance outstanding \| $ / shares	$ 6.76
Weighted Average Exercise Price, Granted \| $ / shares	0.47
Weighted Average Exercise Price, Forfeited/Cancelled \| $ / shares	(5.66)
Weighted Average Exercise Price, Ending balance outstanding \| $ / shares	5.56
Weighted Average Exercise Price, Exercisable \| $ / shares	$ 4.27

Common Stock and Warrants - Summary of Weighted Average Assumptions Used in Estimating Fair Value of Warrants (Details)	Sep. 30, 2020 $ / shares	Mar. 20, 2020 $ / shares	Dec. 31, 2019 $ / shares	Apr. 24, 2018 $ / shares	Apr. 13, 2018 $ / shares
Warrants \| Derivative Financial Instruments Liabilities
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Stock price	$ 0.53		$ 1.23
Exercise price	$ 12.25		$ 12.25
Warrants and Rights Outstanding, Type [Extensible List]	hsdt:BlackScholesOptionPricingModelMember		hsdt:BlackScholesOptionPricingModelMember
April 2018 Offering
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Exercise price					$ 12.25
April 2018 Offering \| Warrants Granted
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Stock price	$ 0.53			$ 10.76	9.85
Exercise price	$ 12.25			$ 12.25	$ 12.25
Warrants and Rights Outstanding, Type [Extensible List]	hsdt:BlackScholesOptionPricingModelMember			hsdt:BlackScholesOptionPricingModelMember	hsdt:BlackScholesOptionPricingModelMember
March 2020 Offering \| Warrants Granted
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Stock price		$ 0.35
Exercise price		$ 0.46
Warrants and Rights Outstanding, Type [Extensible List]		hsdt:BlackScholesOptionPricingModelMember
Warrant Term \| Warrants \| Derivative Financial Instruments Liabilities
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, term	6 months 10 days		1 year 3 months 10 days
Warrant Term \| April 2018 Offering \| Warrants Granted
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, term	6 months 10 days			3 years	3 years
Warrant Term \| March 2020 Offering \| Warrants Granted
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, term		5 years 6 months
Expected Volatility \| Warrants \| Derivative Financial Instruments Liabilities
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, measurement input	107.16		72.43
Expected Volatility \| April 2018 Offering \| Warrants Granted
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, measurement input	107.16			64.49	64.20
Expected Volatility \| March 2020 Offering \| Warrants Granted
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, measurement input		82.41
Risk-Free Interest Rate \| Warrants \| Derivative Financial Instruments Liabilities
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, measurement input	0.16		1.72
Risk-Free Interest Rate \| April 2018 Offering \| Warrants Granted
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, measurement input	0.16			2.02	1.99
Risk-Free Interest Rate \| March 2020 Offering \| Warrants Granted
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, measurement input		0.52
Dividend Rate \| Warrants \| Derivative Financial Instruments Liabilities
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, measurement input	0.00		0.00
Dividend Rate \| April 2018 Offering \| Warrants Granted
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, measurement input	0.00			0.00	0.00
Dividend Rate \| March 2020 Offering \| Warrants Granted
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items]
Weighted average assumptions, measurement input		0.00

Stock-Based Payments - Summary of Company's Restricted Stock Award Activity (Details) - Restricted Stock Units	9 Months Ended
	Sep. 30, 2020 $ / shares shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of Restricted Stock Units, Beginning balance outstanding \| shares	27,697
Number of Restricted Stock Units, Granted \| shares	218,161
Number of Restricted Stock Units, Settled \| shares	(240,106)
Number of Restricted Stock Units, Ending balance outstanding \| shares	5,752
Weighted Average Grant Date Fair Value per Unit, Beginning balance outstanding \| $ / shares	$ 0.61
Weighted Average Grant Date Fair Value per Unit, Granted \| $ / shares	0.50
Weighted Average Grant Date Fair Value per Unit, Settled \| $ / shares	0.52
Weighted Average Grant Date Fair Value per Unit, Ending balance outstanding \| $ / shares	$ 0.39

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2020	Nov. 06, 2020
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2020
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Trading Symbol	HSDT
Entity Registrant Name	HELIUS MEDICAL TECHNOLOGIES, INC.
Entity Central Index Key	0001610853
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Common Stock, Shares Outstanding		51,922,480
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity File Number	001-38445
Entity Tax Identification Number	36-4787690
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	642 Newtown Yardley Road, Suite 100
Entity Address, City or Town	Newtown
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	18940
City Area Code	(215)
Local Phone Number	944-6100
Title of 12(b) Security	Class A Common Stock, $0.001 par value per share
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes
Document Quarterly Report	true
Document Transition Report	false

Summary of Significant Accounting Policies - Summary of Basic and Diluted Loss per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Numerator:
Net loss	$ (3,477)	$ (5,588)	$ (11,595)	$ (4,450)
Denominator:
Weighted average common shares outstanding - basic	45,137,995	25,903,544	39,187,370	25,869,039
Basic net loss per share	$ (0.08)	$ (0.22)	$ (0.30)	$ (0.17)
Numerator:
Net loss, basic	$ (3,477)	$ (5,588)	$ (11,595)	$ (4,450)
Net loss, diluted	$ (3,477)	$ (5,588)	$ (11,595)	$ (4,450)
Denominator:
Weighted average common shares outstanding - basic	45,137,995	25,903,544	39,187,370	25,869,039
Potential common share issuances:
Weighted average common shares outstanding	45,137,995	25,903,544	39,187,370	25,869,039
Diluted net loss per share	$ (0.08)	$ (0.22)	$ (0.30)	$ (0.17)

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2020

Commitments And Contingencies Disclosure [Abstract]

Schedule of Future Minimum Lease Payments Related to Non-cancellable Operating Lease Commitments

The following table summarizes the Company’s operating lease information including future minimum lease payments under a non-cancellable lease as of September 30, 2020 (amounts in thousands).

For the Nine Months Ended September 30, 2020
Operating lease cost	$	57
Operating lease - operating cash flows	$	189
Weighted average remaining lease term	1.75 years
Weighted average discount rate		7.2	%

Future minimum lease payments under non-cancellable lease as of September 30, 2020 were as follows:
For the Period Ending December 31,
2020 (remaining three months)	$	63
2021		63
2022		32
Total future minimum lease payments		158
Less imputed interest		(4	)
Total liability	$	154
Reported as of September 30, 2020
Current operating lease liability		107
Non-current operating lease liability		47
Total	$	154

Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2020	Dec. 31, 2019
Statement Of Financial Position [Abstract]
Preferred stock, Par Value	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	10,000,000	10,000,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Common Stock, Par Value	$ 0.001	$ 0.001
Common Stock, Shares Authorized	150,000,000	150,000,000
Common Stock, Shares, Issued	45,354,612	30,718,554
Common Stock, Shares, Outstanding	45,354,612	30,718,554

Description of Business

9 Months Ended

Sep. 30, 2020

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Description of Business

1. DESCRIPTION OF BUSINESS

Helius Medical Technologies, Inc. (“we” or the “Company”), is a neurotech company focused on neurological wellness. The Company’s purpose is to develop, license or acquire unique and non-invasive technologies targeted at reducing symptoms of neurological disease or trauma.

The Company’s first product, known as the Portable Neuromodulation Stimulator (“PoNS^TM”), is authorized for sale in Canada as a class II, non-implantable medical device intended as a short term treatment (14 weeks) of gait deficit due to mild and moderate symptoms from multiple sclerosis (“MS”,) and chronic balance deficit due to mild-to-moderate traumatic brain injury (“mmTBI”) and is to be used in conjunction with physical therapy (“PoNS Treatment^TM”). It is an investigational medical device in the United States, the European Union (“EU”), and Australia (“AUS”). The device is currently under review for de novo classification and clearance by the U.S. Food and Drug Administration (the “FDA”) as a potential treatment for gait deficit due to symptoms of MS. It is also under premarket review by the AUS Therapeutic Goods Administration. PoNS Treatment™ is not currently commercially available in the United States, the European Union or Australia.

The Company was incorporated in British Columbia, Canada on March 13, 2014. On May 28, 2014, we were reincorporated from British Columbia to the State of Wyoming, and on July 20, 2018, we were reincorporated from the State of Wyoming to the State of Delaware. We are headquartered in Newtown, Pennsylvania. On December 21, 2018, the Company’s wholly owned subsidiary, NeuroHabilitation Corporation, changed its name to Helius Medical, Inc (“HMI”). On January 31, 2019, the Company formed another wholly owned subsidiary, Helius NeuroRehab, Inc., (“HNR”), a Delaware corporation. On October 10, 2019, the Company formed Helius Canada Acquisition Ltd. (“HCA”), a company incorporated under the federal laws of Canada and a wholly owned subsidiary of Helius Medical Technologies (Canada), Inc. (“HMC”), a company incorporated under the federal laws of Canada, which acquired Heuro Canada, Inc. (“Heuro”) from Health Tech Connex Inc. (“HTC”) on October 30, 2019.

Going Concern Uncertainty

Risks and Uncertainties

COVID-19

Nasdaq Delisting

Stock-Based Payments - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2020	May 15, 2018
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of stock option issued		809,590
Stock based compensation expense reversal	$ 125	$ 125
Employee and Director Stock Options
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of stock option issued		809,590
Unrecognized compensation cost related to non-vested stock options outstanding	4,100	$ 4,100
Weighted-average remaining vesting period		2 years 9 months 18 days
Weighted average grant date fair value		$ 0.30
Consultants Stock Options
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of stock option issued		0
Non-employee Stock Options
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized compensation cost related to non-vested stock options outstanding	$ 15	$ 15
Weighted-average remaining vesting period		10 months 24 days
2018 Omnibus Incentive Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Common stock shares authorized and approved to issue under plan			5,356,114
Common stock shares available for issuance			3,000,000
Common stock remaining available for grant	3,387,958	3,387,958
2016 Omnibus Incentive Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Common stock shares available for issuance			2,356,114

Summary of Significant Accounting Policies - Summary of Property and Equipment (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Property Plant And Equipment [Line Items]
Property and equipment	$ 639	$ 897
Less accumulated depreciation	(176)	(185)
Property and equipment, net	463	712
Leasehold Improvements
Property Plant And Equipment [Line Items]
Property and equipment	64	182
Furniture and Fixtures
Property Plant And Equipment [Line Items]
Property and equipment	93	247
Equipment
Property Plant And Equipment [Line Items]
Property and equipment	300	286
Computer Software and Hardware
Property Plant And Equipment [Line Items]
Property and equipment	$ 182	$ 182

Common Stock and Warrants - Additional Information (Details) $ / shares in Units, $ / shares in Units, $ in Millions								1 Months Ended	9 Months Ended
	Sep. 30, 2020 CAD ($) shares	Mar. 20, 2020 USD ($) $ / shares shares	Jan. 27, 2020 USD ($)	Nov. 22, 2019 USD ($) $ / shares shares	Apr. 24, 2018 shares	Apr. 24, 2018 USD ($) shares	Apr. 13, 2018 USD ($) $ / shares shares	Mar. 31, 2020 USD ($)	Sep. 30, 2020 USD ($) $ / shares shares	Dec. 31, 2019 $ / shares shares	Apr. 13, 2018 $ / shares shares
Schedule Of Stockholders Equity [Line Items]
Common stock, shares authorized									150,000,000	150,000,000
Common stock, par value \| $ / shares									$ 0.001	$ 0.001
Preferred stock, shares authorized									10,000,000	10,000,000
Preferred stock, par value \| $ / shares									$ 0.001	$ 0.001
Common share, voting rights									one vote per share
Common share, dividends declared \| $									$ 0
Price per share \| $ / shares				$ 0.35
Net proceeds from offering \| $				$ 1,100,000
Class of warrants exercised	70,900
Proceeds received from exercise of outstanding warrants \| $	$ 0.9
Gross proceeds from issuance of common stock \| $									$ 7,233,000
Common Stock
Schedule Of Stockholders Equity [Line Items]
Issuance of common stock in public offering				4,815,010
April 2018 Offering
Schedule Of Stockholders Equity [Line Items]
Warrants to purchase number of common stock, shares							2,141,900				2,141,900
Price per share \| $ / shares							$ 7.47
Net proceeds from offering \| $						$ 16,300,000
Fair value of warrants at issuance \| $							$ 7,400,000
Warrant exercisable price per share \| $ / shares											$ 12.25
Warrants expiration date							Apr. 10, 2021
Number of common stock converted by each warrant							1				1
April 2018 Offering \| Common Stock
Schedule Of Stockholders Equity [Line Items]
Issuance of common stock in public offering							2,141,900
Over-Allotment Option
Schedule Of Stockholders Equity [Line Items]
Warrants to purchase number of common stock, shares					321,285	321,285
Over-Allotment Option \| Common Stock
Schedule Of Stockholders Equity [Line Items]
Issuance of common stock in public offering					321,285
2020 ATM
Schedule Of Stockholders Equity [Line Items]
Price per share \| $ / shares									$ 0.62
Gross proceeds from issuance of common stock \| $									$ 5,000,000
Offering expenses incurred \| $									$ 181,000
2020 ATM \| Form S3 Shelf Registration
Schedule Of Stockholders Equity [Line Items]
Aggregate offering amount \| $			$ 11,340,000					$ 9,150,000
2020 ATM \| Common Stock
Schedule Of Stockholders Equity [Line Items]
Issuance of common stock in public offering									8,138,808
March 2020 Offering
Schedule Of Stockholders Equity [Line Items]
Warrants to purchase number of common stock, shares		6,257,144
Price per share \| $ / shares		$ 0.35
Fair value of warrants at issuance \| $		$ 800,000
Warrant exercisable price per share \| $ / shares		$ 0.46
Warrants expiration date		Mar. 20, 2025
Number of common stock converted by each warrant		1
Gross proceeds from issuance of common stock \| $		$ 2,200,000
Underwriting discounts and commissions paid \| $		$ 300,000
March 2020 Offering \| Common Stock
Schedule Of Stockholders Equity [Line Items]
Issuance of common stock in public offering		6,257,144

Common Stock and Warrants (Tables)

9 Months Ended

Sep. 30, 2020

Summary of Weighted Average Assumptions Used in Estimating Fair Value of Warrants

The fair value of all warrants classified as derivative financial instruments outstanding as of September 30, 2020 and December 31, 2019 were estimated using the Black-Scholes option pricing model with the following weighted average assumptions:

	September 30, 2020			December 31, 2019
Stock price	CAD$ 0.53			CAD$ 1.23
Exercise price	CAD$ 12.25			CAD$ 12.25
Warrant term	0.53 years			1.28 years
Expected volatility		107.16	%		72.43	%
Risk-free interest rate		0.16	%		1.72	%
Dividend rate		0.00	%		0.00	%

Summary of Warrants Accounted for as Liabilities and Recorded as Derivative Financial Instruments

The following table summarizes warrants accounted for as liabilities and recorded as derivative financial instruments on the Company’s condensed consolidated balance sheets for the nine months ended September 30, 2020 and 2019 (amounts in thousands):

	Nine Months Ended September 30,
	2020			2019
Fair value of warrants at beginning of period	$	5		$	13,769
Exercise of warrants		—			(35	)
Foreign exchange losses		(1	)		382
Change in fair value of warrants during the period		(4	)		(14,033	)
Fair value of warrants at end of period	$	—		$	83

Summary of Warrant Activity

The following is a summary of the Company’s warrant activity during the nine months ended September 30, 2020:

	Number of Warrants					Weighted Average Exercise Price
	CAD		US			CAD$		USD$
Outstanding as of December 31, 2019		2,392,285		651,320		$	12.25	$	12.24
Granted		—		6,257,144			—		0.46
Cancelled/Expired		—		(5,304	)		—		10.75
Exercised		—		—			—		—
Outstanding as of September 30, 2020		2,392,285		6,903,160		$	12.25	$	1.56

Warrants Outstanding and Exercisable

The Company’s warrants outstanding and exercisable as of September 30, 2020 were as follows:

Number of Warrants Outstanding		Exercise Price	Expiration Date
	270,915	USD$12.25	December 22, 2020
	171,020	USD$12.25	December 28, 2020
	204,081	USD$12.25	December 29, 2020
	2,392,285	CAD$12.25	April 10, 2021
	6,257,144	USD$0.46	March 20, 2025
	9,295,445

April 2018 Offering

Summary of Weighted Average Assumptions Used in Estimating Fair Value of Warrants

The following table summarizes the weighted average assumptions used in estimating the fair value of the warrants issued in the April 2018 Offering using the Black-Scholes option pricing model as of the date of the initial closing of the offering and the date of the closing of the over-allotment option and September 30, 2020.

	September 30, 2020			April 24, 2018			April 13, 2018
Stock price	CAD$ 0.53			CAD$ 10.76			CAD$ 9.85
Exercise price	CAD$ 12.25			CAD$ 12.25			CAD$ 12.25
Warrant term	0.53 years			3.00 years			3.00 years
Expected volatility		107.16	%		64.49	%		64.20	%
Risk-free interest rate		0.16	%		2.02	%		1.99	%
Dividend rate		0.00	%		0.00	%		0.00	%

March 2020 Offering

Summary of Weighted Average Assumptions Used in Estimating Fair Value of Warrants

The following table summarizes the weighted average assumptions used in estimating the fair value of the warrants granted in the March 2020 Offering using the Black-Scholes option pricing model as of the date of the closing of the offering on March 20, 2020.

	March 20, 2020
Stock price	$	0.35
Exercise price	$	0.46
Warrant term	5.50 years
Expected volatility		82.41	%
Risk-free interest rate		0.52	%
Dividend rate		0.00	%

Summary of Significant Accounting Policies - Summary of Recognized Fair Values of Identifiable Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019	Oct. 30, 2019
Assets:
Cash and cash equivalents			$ 1
Other receivables			19
Fixed assets			7
Intangibles			1,053
Goodwill	$ 725	$ 1,242	737
Total assets			1,817
Liabilities:
Accounts payable			186
Other current liabilities			9
Total liabilities			195
Net assets acquired			$ 1,622

Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Schedule of Inventory

As of September 30, 2020 and December 31, 2019, inventory consisted of the following (amounts in thousands):

	As of			As of
	September 30, 2020			December 31, 2019
Raw materials	$	159		$	144
Work-in-process		446			375
Finished goods		19			129
Inventory	$	624		$	648
Inventory reserve		(52	)		(50	)
Total inventory, net of reserve	$	572		$	598

Summary of Property and Equipment

As of September 30, 2020 and December 31, 2019, property and equipment consisted of the following (amounts in thousands):

	As of			As of
	September 30, 2020			December 31, 2019
Leasehold improvement	$	64		$	182
Furniture and fixtures		93			247
Equipment		300			286
Computer software and hardware		182			182
Property and equipment		639			897
Less accumulated depreciation		(176	)		(185	)
Property and equipment, net	$	463		$	712

Summary of Recognized Fair Values of Identifiable Assets Acquired and Liabilities Assumed

The following table summarizes the recognized fair values of identifiable assets acquired and liabilities assumed as of October 30, 2019:

	October 30, 2019 Fair Value
Assets:
Cash and cash equivalents	$	1
Other receivables		19
Fixed assets		7
Intangibles		1,053
Goodwill		737
Total assets	$	1,817
Liabilities:
Accounts payable	$	186
Other current liabilities		9
Total liabilities	$	195
Net assets acquired	$	1,622

Summary of Activity for Goodwill

The following is a summary of the activity for the period ended September 30, 2020 for goodwill:

Goodwill	2020
Carrying amount at beginning of period	$	1,242
Business acquisition fair value allocation adjustment		(454	)
Foreign currency translation		(63	)
Carrying amount at end of period	$	725

Summary of Intangible Assets

Intangible assets as of September 30, 2020 and December 31, 2019 consist of the following:

		As of September 30, 2020					As of December 31, 2019
	Useful Life	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Customer relationships	1.25 years	$	227	$	(191	)	$	423	$	(55	)
Acquired proprietary software	5 years		143		(26	)		148		(5	)
Reacquired rights	3.87 years		480		(113	)		—		—
Internally developed software	3 years		82		(23	)		75		(4	)
Total intangible assets		$	932	$	(353	)	$	646	$	(64	)

Summary of Anticipated Amortization Expense

Amortization expense is anticipated to be as follows in future years:

For the Year Ending December 31,
2020 (remaining 3 months)	$	73
2021		189
2022		176
2023		117
2024		24
	$	579

Summary of Recurring Fair Value Measurements for Derivative Financial Instruments and Stock-Based Compensation Liability

	Fair Value		Level 1		Level 2		Level 3
September 30, 2020
Liabilities:
Derivative financial instruments	$	—		—		—	$	—
December 31, 2019
Liabilities:
Derivative financial instruments	$	5		—		—	$	5

Summary of Basic and Diluted Loss per Share

The basic and diluted loss per share for the periods noted below is as follows (amounts in thousands except shares and per share data):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2020			2019			2020			2019
Basic
Numerator:
Net loss	$	(3,477	)	$	(5,588	)	$	(11,595	)	$	(4,450	)
Denominator:
Weighted average common shares outstanding		45,137,995			25,903,544			39,187,370			25,869,039
Basic net loss per share	$	(0.08	)	$	(0.22	)	$	(0.30	)	$	(0.17	)

Diluted
Numerator:
Net loss, basic	$	(3,477	)	$	(5,588	)	$	(11,595	)	$	(4,450	)
Effect of dilutive securities		—			—			—			—
Net loss, diluted	$	(3,477	)	$	(5,588	)	$	(11,595	)	$	(4,450	)
Denominator:
Weighted average common shares outstanding - basic		45,137,995			25,903,544			39,187,370			25,869,039
Potential common share issuances:
Incremental dilutive shares from equity instruments (treasury stock method)		—			—			—			—
Weighted average common shares outstanding		45,137,995			25,903,544			39,187,370			25,869,039
Diluted net loss per share	$	(0.08	)	$	(0.22	)	$	(0.30	)	$	(0.17	)

Summary of Outstanding Securities Excluded from Computation of Diluted Weighted Shares Outstanding

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019
Stock options outstanding		3,929,944		3,629,288		3,929,944		3,629,288
RSUs		5,752		—		5,752		—
Warrants outstanding		9,295,445		3,043,605		9,295,445		3,043,605
Total		13,231,141		6,672,893		13,231,141		6,672,893

Description of Business - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands				3 Months Ended		9 Months Ended
	Oct. 26, 2020	Apr. 17, 2020	Mar. 23, 2020	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019	Nov. 22, 2019
Description Of Business [Line Items]
Date of incorporation						Mar. 13, 2014
Cash				$ 2,680		$ 2,680		$ 5,459
Operating loss				3,660	$ 5,736	11,384	$ 18,371
Accumulated deficit				116,368		116,368		$ 104,773
Total operating revenue				$ 131	$ 150	470	$ 1,344
Net proceeds received from private placement						$ 3,254
Number of consecutive business days			30 days
Common stock per share compliance regain period		180 days	180 days
Common stock per share									$ 0.35
Minimum
Description Of Business [Line Items]
Common stock per share			$ 1.00
Common stock for ten consecutive business days		$ 1.00
Subsequent Event
Description Of Business [Line Items]
Net proceeds received from private placement	$ 3,200

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenue:
Total operating revenue	$ 131,000	$ 150,000	$ 470,000	$ 1,344,000
Cost of sales:
Cost of product sales	$ 22,000	$ 89,000	$ 187,000	$ 538,000
Type of Cost, Good or Service [Extensible List]	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember
Gross profit	$ 109,000	$ 61,000	$ 283,000	$ 806,000
Operating expenses:
Research and development	1,327,000	1,506,000	3,755,000	6,462,000
Selling, general and administrative	2,370,000	4,291,000	7,625,000	12,715,000
Amortization expense	72,000		287,000
Total operating expenses	3,769,000	5,797,000	11,667,000	19,177,000
Operating loss	(3,660,000)	(5,736,000)	(11,384,000)	(18,371,000)
Other income (expense):
Other income		11,000	63,000	35,000
Change in fair value of derivative financial instruments	1,000	196,000	4,000	14,033,000
Foreign exchange gain (loss)	182,000	(59,000)	(278,000)	(147,000)
Total other income (expense)	183,000	148,000	(211,000)	13,921,000
Net loss	(3,477,000)	(5,588,000)	(11,595,000)	(4,450,000)
Other comprehensive loss:
Foreign currency translation adjustments	(172,000)	68,000	209,000	(168,000)
Comprehensive loss	$ (3,649,000)	$ (5,520,000)	$ (11,386,000)	$ (4,618,000)
Net loss per share
Basic	$ (0.08)	$ (0.22)	$ (0.30)	$ (0.17)
Diluted	$ (0.08)	$ (0.22)	$ (0.30)	$ (0.17)
Weighted average shares outstanding
Basic	45,137,995	25,903,544	39,187,370	25,869,039
Diluted	45,137,995	25,903,544	39,187,370	25,869,039
Product Sales
Revenue:
Total operating revenue	$ 124,000	$ 150,000	$ 441,000	$ 1,295,000
Fee Revenue
Revenue:
Total operating revenue			9,000	49,000
License Revenue
Revenue:
Total operating revenue	$ 7,000		$ 20,000	$ 0

Accrued Expenses (Tables)

9 Months Ended

Sep. 30, 2020

Payables And Accruals [Abstract]

Schedule of Accrued Expenses

Accrued expenses consisted of the following (amounts in thousands):

	As of
	September 30, 2020		December 31, 2019
Employees benefits	$	557	$	722
Professional services		6		67
Legal fees		163		81
Royalty fees		5		13
Franchise fees		40		28
Severance		550		606
Other		78		2
Total	$	1,399	$	1,519

Summary of Significant Accounting Policies - Summary of Intangible Assets (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Finite Lived Intangible Assets [Line Items]
Intangible assets, Gross Carrying Amount	$ 932	$ 646
Intangible assets, Accumulated Amortization	$ (353)	(64)
Customer Relationships
Finite Lived Intangible Assets [Line Items]
Intangible assets, Useful Life	1 year 3 months
Intangible assets, Gross Carrying Amount	$ 227	423
Intangible assets, Accumulated Amortization	$ (191)	(55)
Acquired Proprietary Software
Finite Lived Intangible Assets [Line Items]
Intangible assets, Useful Life	5 years
Intangible assets, Gross Carrying Amount	$ 143	148
Intangible assets, Accumulated Amortization	$ (26)	(5)
Reacquired Rights
Finite Lived Intangible Assets [Line Items]
Intangible assets, Useful Life	3 years 10 months 13 days
Intangible assets, Gross Carrying Amount	$ 480
Intangible assets, Accumulated Amortization	$ (113)
Internally Developed Software
Finite Lived Intangible Assets [Line Items]
Intangible assets, Useful Life	3 years
Intangible assets, Gross Carrying Amount	$ 82	75
Intangible assets, Accumulated Amortization	$ (23)	$ (4)

Common Stock and Warrants

9 Months Ended

Sep. 30, 2020

Equity [Abstract]

Common Stock and Warrants

3. COMMON STOCK AND WARRANTS

The Company’s authorized capital stock pursuant to its Delaware charter consists of 150,000,000 authorized shares of common stock, at a par value per share of $0.001 and 10,000,000 authorized shares of preferred stock at a par value per share of $0.001. Holders of common stock are entitled to vote at any meeting of the Company’s stockholders on the basis of one vote per share of common stock owned as of the record date of such meeting. Each share of common stock entitles the holder to receive dividends, if any, as declared by the Company’s Board of Directors.

No dividends have been declared since inception of the Company through September 30, 2020. In the event of a liquidation, dissolution or winding-up of the Company, other distribution of assets of the Company among its stockholders for the purposes of winding-up its affairs or upon a reduction of capital, the stockholders shall, share equally, share for share, in the remaining assets and property of the Company.

On April 13, 2018, the Company issued 2,141,900 shares of its common stock and warrants to purchase 2,141,900 shares of the Company’s common stock in an underwritten public offering at a price of $7.47 per share and accompanying warrant. On April 24, 2018, the Company closed on the sale of an additional 321,285 shares of its common stock and warrants to purchase 321,285 shares of the Company’s common stock pursuant to the exercise of the underwriters’ over-allotment option (collectively the “April 2018 Offering”). The Company received net proceeds of $16.3 million from the April 2018 Offering. The fair value of these warrants at issuance was approximately $7.4 million.

Each warrant issued in connection with the April 2018 Offering entitles the holder to acquire one additional share of common stock at an exercise price of CAD$12.25 per share on or before April 10, 2021. Pursuant to the guidance of ASC 815 Derivatives and Hedging, the Company has determined that warrants issued in connection with the April 2018 Offering should be accounted for as liabilities as the ability to maintain an effective registration is outside of the Company’s control and that it may be required to settle the exercise of the warrants in cash and because, as a result of the change in the Company’s functional currency (see Note 2), the exercise prices of these warrants are in a currency other than the Company’s functional currency. Consequently, the Company determined the fair value of each warrant issuance using the Black-Scholes option pricing model, with the remainder of the proceeds allocated to the common shares. As of September 30, 2020, 70,900 warrants had been exercised, all during 2018, for gross proceeds of CAD$0.9 million.

	September 30, 2020			April 24, 2018			April 13, 2018
Stock price	CAD$ 0.53			CAD$ 10.76			CAD$ 9.85
Exercise price	CAD$ 12.25			CAD$ 12.25			CAD$ 12.25
Warrant term	0.53 years			3.00 years			3.00 years
Expected volatility		107.16	%		64.49	%		64.20	%
Risk-free interest rate		0.16	%		2.02	%		1.99	%
Dividend rate		0.00	%		0.00	%		0.00	%

On November 22, 2019, the Company issued 4,815,010 shares of its common stock in an underwritten public offering at a price of $0.35 per share. The Company received net proceeds of $1.1 million.

On January 27, 2020, the Company filed a Form S-3 shelf registration under the Securities Act which was declared effective by the SEC on February 6, 2020 (the “2020 Shelf”). In conjunction with the 2020 Shelf, on January 27, 2020, the Company entered into an At The Market Offering Agreement (the “2020 ATM”) with H.C. Wainwright & Co., LLC (“Wainwright”) under which the Company may offer and sell, from time to time at its sole discretion, to or through Wainwright, acting as agent and/or principal, shares of its common stock having an aggregate offering price of up to $11.34 million, which, in March 2020, was subsequently reduced to $9.15 million, including the shares previously sold under the 2020 ATM. For the nine months ended September 30, 2020, under the 2020 ATM, the Company sold and issued 8,138,808 shares of its common stock with an aggregated market value of $5.0 million at an average price of $0.62 per share and paid Wainwright a sales commission of approximately $181 thousand related to those shares.

On March 20, 2020, the Company, in a registered direct offering, issued an aggregate of 6,257,144 shares of its common stock at a price of $0.35 per share. Additionally, the Company issued unregistered warrants in a concurrent private placement to purchase up to 6,257,144 shares of its common stock at an exercise price of $0.46 per share. Gross proceeds from the offering (the “March 2020 Offering”) were approximately $2.2 million. The underwriting discounts and commissions and offering expenses of $0.3 million were recorded to share issuance costs.

Each warrant issued in connection with the March 2020 Offering entitles the holder to acquire one additional share of common stock at an exercise price of $0.46 per share, which became exercisable on September 20, 2020 and will expire on March 20, 2025. Pursuant to the guidance of ASC 480 Distinguishing Liabilities from Equity and ASC 815 Derivatives and Hedging, the Company has determined that warrants issued in connection with the March 2020 Offering should be classified as equity as the warrants can be settled with unregistered shares. The relative fair value of these warrants at issuance was approximately $0.8 million and was included in additional paid-in capital.

	March 20, 2020
Stock price	$	0.35
Exercise price	$	0.46
Warrant term	5.50 years
Expected volatility		82.41	%
Risk-free interest rate		0.52	%
Dividend rate		0.00	%

	Nine Months Ended September 30,
	2020			2019
Fair value of warrants at beginning of period	$	5		$	13,769
Exercise of warrants		—			(35	)
Foreign exchange losses		(1	)		382
Change in fair value of warrants during the period		(4	)		(14,033	)
Fair value of warrants at end of period	$	—		$	83

These warrants which are classified as derivative financial instruments in the Company’s condensed consolidated balance sheets are required to be re-measured at each reporting period, with the change in fair value recorded as a gain or loss in the change in fair value of derivative financial instruments, included in other income (expense) in the Company’s condensed consolidated statements of operations and comprehensive loss. The fair value of the warrants will continue to be classified as a liability until such time as they are exercised, expire or there is an amendment to the respective agreements that renders these financial instruments to be no longer classified as such.

	September 30, 2020			December 31, 2019
Stock price	CAD$ 0.53			CAD$ 1.23
Exercise price	CAD$ 12.25			CAD$ 12.25
Warrant term	0.53 years			1.28 years
Expected volatility		107.16	%		72.43	%
Risk-free interest rate		0.16	%		1.72	%
Dividend rate		0.00	%		0.00	%

The following is a summary of the Company’s warrant activity during the nine months ended September 30, 2020:

	Number of Warrants					Weighted Average Exercise Price
	CAD		US			CAD$		USD$
Outstanding as of December 31, 2019		2,392,285		651,320		$	12.25	$	12.24
Granted		—		6,257,144			—		0.46
Cancelled/Expired		—		(5,304	)		—		10.75
Exercised		—		—			—		—
Outstanding as of September 30, 2020		2,392,285		6,903,160		$	12.25	$	1.56

The Company’s warrants outstanding and exercisable as of September 30, 2020 were as follows:

Number of Warrants Outstanding		Exercise Price	Expiration Date
	270,915	USD$12.25	December 22, 2020
	171,020	USD$12.25	December 28, 2020
	204,081	USD$12.25	December 29, 2020
	2,392,285	CAD$12.25	April 10, 2021
	6,257,144	USD$0.46	March 20, 2025
	9,295,445

Accrued Expenses

9 Months Ended

Sep. 30, 2020

Payables And Accruals [Abstract]

Accrued Expenses

5.	ACCRUED EXPENSES

Accrued expenses consisted of the following (amounts in thousands):

	As of
	September 30, 2020		December 31, 2019
Employees benefits	$	557	$	722
Professional services		6		67
Legal fees		163		81
Royalty fees		5		13
Franchise fees		40		28
Severance		550		606
Other		78		2
Total	$	1,399	$	1,519

Accrued severance expenses as of September 30, 2020 included $0.5 million in severance costs related to the departure of our former chief executive officer in August 2020.

Commitments and Contingencies - Additional Information (Details) - USD ($)						1 Months Ended			3 Months Ended		9 Months Ended
	Sep. 30, 2020	Jun. 01, 2020	Apr. 13, 2020	Dec. 29, 2017	Jan. 22, 2013	May 31, 2020	Jul. 31, 2017	Mar. 31, 2017	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Oct. 30, 2017
Commitments And Contingencies [Line Items]
Lease commencement date						Jul. 01, 2020	Jul. 17, 2017	Jul. 01, 2017
Lease termination date						Jun. 30, 2021	Jan. 16, 2023	Dec. 31, 2022
Lease option to extend termination year								2027
Lease option to extend termination date							Jan. 31, 2028
Lease option to extend lease term						6 months
Lease monthly rent plus utilities						$ 5,000	$ 20,000
Lease monthly rent plus utilities beginning date						Jan. 31, 2021	Jan. 31, 2018
Lease annual increase in rental percentage						3.00%	3.00%
Decrease in operating lease right of use asset, partial termination						$ 400,000
Decrease in operating lease liability						$ 400,000
PPP Loan
Commitments And Contingencies [Line Items]
Loan proceeds received, amount			$ 323,000
Other Income
Commitments And Contingencies [Line Items]
Gain on termination of lease									$ 100,000		$ 100,000
Advanced NeuroRehabilitation, LLC \| License Agreement for Exclusive Right on Patent Pending Technology
Commitments And Contingencies [Line Items]
Issuance of common stock for license agreement					3,207,005
Percentage of royalty on net revenue					4.00%
Royalty expense									$ 5,000	$ 6,000	$ 15,000	$ 52,000
A&B Company Limited \| Asset Purchase Agreement
Commitments And Contingencies [Line Items]
Contract penalty payable on failure to obtain FDA clearance													$ 2,000,000
Key Tronic Corporation \| Manufacturing and Supply Agreement
Commitments And Contingencies [Line Items]
Agreement description											On December 29, 2017, HMI (formerly known as NeuroHabilitation Corporation) entered into a Manufacturing and Supply Agreement (“MSA”) with Key Tronic Corporation (“Key Tronic”), for the manufacture and supply of the Company’s PoNS device based upon the Company’s product specifications as set forth in the MSA. Per the agreement, the Company shall provide to Key Tronic a rolling forecast for the procurement of parts and material and within normal lead times based on estimated delivery dates for the manufacture of the PoNS device. The term of the agreement is for three years and will automatically renew for additional consecutive terms of one year, unless cancelled by either party upon 180-day written notice to the other party prior to the end of the then current term. On June 1, 2020, HMI extended the existing manufacturing agreement with Key Tronic for a second three year term from December 29, 2020 until December 31, 2023. As of September 30, 2020, the Company did not have any outstanding commitments to Key Tronic to complete the Company’s forecasts for the procurement of materials necessary for the delivery of PoNS devices.
Agreement term				3 years
Agreement auto renewal period				1 year
Notice period to cancel the renewal of agreement				180 days
Outstanding commitments	$ 0
Extended manufacturing agreement term		3 years

Summary of Significant Accounting Policies - Summary of Anticipated Amortization Expense (Details) $ in Thousands	Sep. 30, 2020 USD ($)
Accounting Policies [Abstract]
2020 (remaining 3 months)	$ 73
2021	189
2022	176
2023	117
2024	24
Total	$ 579

Summary of Significant Accounting Policies - Summary of Activity for Goodwill (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($)
Accounting Policies [Abstract]
Carrying amount at beginning of period	$ 1,242
Business acquisition fair value allocation adjustment	(454)
Foreign currency translation	(63)
Carrying amount at end of period	$ 725

Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Cash flows from operating activities:
Net loss	$ (11,595)	$ (4,450)
Adjustments to reconcile net loss to net cash used in operating activities:
Change in fair value of derivative financial instruments	(4)	(14,033)
Stock-based compensation expense	2,021	3,336
Unrealized foreign exchange loss	245	211
Depreciation expense	92	89
Amortization expense	287
Provision for doubtful accounts	160
Intangible asset impairment	182
Loss from disposal of property and equipment	110
Gain on lease modification	(56)
Changes in operating assets and liabilities:
Accounts receivable	(30)	(380)
Other receivables	226	(123)
Inventory	26	(897)
Prepaid expenses	(56)	285
Other current assets		264
Operating lease liability	20	(9)
Accounts payable	(956)	(678)
Accrued liabilities	(120)	(75)
Deferred revenue	(119)
Net cash used in operating activities	(9,567)	(16,460)
Cash flows from investing activities:
Purchase of property and equipment	(14)	(260)
Proceeds from sale of property and equipment	61
Internally developed software	(7)
Net cash provided by (used in) investing activities	40	(260)
Cash flows from financing activities:
Proceeds from the issuances of common stock and warrants	7,233
Share issuance costs	(506)	(52)
Proceeds from the exercise of stock options and warrants		215
Proceeds from Paycheck Protection Program Loan	323
Repayment of Paycheck Protection Program Loan	(323)
Net cash provided by financing activities	6,727	163
Effect of foreign exchange rate changes on cash	21	(7)
Net decrease in cash	(2,779)	(16,564)
Cash at beginning of period	5,459	25,583
Cash at end of period	$ 2,680	$ 9,019

Stock-Based Payments - Schedule of Fair Value of Employee and Director Stock Options Granted Estimated Using Black-Scholes Option Pricing Model With Following Weighted Average Assumptions (Details) - Employee and Director Stock Options	9 Months Ended
	Sep. 30, 2020 $ / shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock price	$ 0.47
Exercise price	$ 0.47
Expected term	5 years 3 months 3 days
Expected volatility	77.35%
Risk-free interest rate	0.58%
Dividend rate	0.00%

Summary of Significant Accounting Policies - Summary of Outstanding Securities Excluded from Computation of Diluted Weighted Shares Outstanding (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Antidilutive Securities Excluded from Computation of Earnings per Share [Line Items]
Anti-dilutive securities excluded from calculation of diluted loss per share	13,231,141	6,672,893	13,231,141	6,672,893
Stock Options Outstanding
Antidilutive Securities Excluded from Computation of Earnings per Share [Line Items]
Anti-dilutive securities excluded from calculation of diluted loss per share	3,929,944	3,629,288	3,929,944	3,629,288
RSUs
Antidilutive Securities Excluded from Computation of Earnings per Share [Line Items]
Anti-dilutive securities excluded from calculation of diluted loss per share	5,752		5,752
Warrants Outstanding
Antidilutive Securities Excluded from Computation of Earnings per Share [Line Items]
Anti-dilutive securities excluded from calculation of diluted loss per share	9,295,445	3,043,605	9,295,445	3,043,605

Stock-Based Payments - Summary of Stock-Based Compensation Expense is Classified in Condensed Consolidated Statements of Operations and Comprehensive Loss (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	$ 450	$ 1,560	$ 2,021	$ 3,336
Research and Development Expense
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	245	233	727	643
Cost of Sales
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense		(6)	(1)
Selling, General and Administrative Expense
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	$ 205	$ 1,333	$ 1,295	$ 2,693

Common Stock and Warrants - Summary of Warrant Activity (Details)			9 Months Ended
	Sep. 30, 2020 $ / shares shares	Sep. 30, 2020 $ / shares shares	Sep. 30, 2020 $ / shares shares	Sep. 30, 2020 $ / shares shares
Class Of Warrant Or Right [Line Items]
Number of Warrants, Exercised	(70,900)	(70,900)
Number of Warrants, Outstanding, ending balance	9,295,445	9,295,445	9,295,445	9,295,445
CAD
Class Of Warrant Or Right [Line Items]
Number of Warrants, Outstanding, beginning balance			2,392,285	2,392,285
Number of Warrants, Outstanding, ending balance	2,392,285	2,392,285	2,392,285	2,392,285
Weighted Average Exercise Price, Outstanding, beginning balance \| $ / shares				$ 12.25
Weighted Average Exercise Price, Outstanding, ending balance \| $ / shares		$ 12.25		$ 12.25
USD
Class Of Warrant Or Right [Line Items]
Number of Warrants, Outstanding, beginning balance			651,320	651,320
Number of Warrants, Granted			6,257,144	6,257,144
Number of Warrants, Cancelled/Expired			(5,304)	(5,304)
Number of Warrants, Outstanding, ending balance	6,903,160	6,903,160	6,903,160	6,903,160
Weighted Average Exercise Price, Outstanding, beginning balance \| $ / shares			$ 12.24
Weighted Average Exercise Price, Granted \| $ / shares			0.46
Weighted Average Exercise Price, Cancelled/Expired \| $ / shares			10.75
Weighted Average Exercise Price, Outstanding, ending balance \| $ / shares	$ 1.56		$ 1.56

Stock-Based Payments

9 Months Ended

Sep. 30, 2020

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Payments

4. STOCK-BASED PAYMENTS

On May 15, 2018, the Company’s Board of Directors authorized and approved the adoption of the 2018 Omnibus Incentive Plan, (as amended, the “2018 Plan”), which was effective upon approval by the stockholders of the Company on June 28, 2018 and under which an aggregate of 5,356,114 shares may be issued. This share reserve is the sum of 3,000,000 new shares, plus the 2,356,114 shares that remained available for issuance under the Company’s 2016 Omnibus Incentive Plan (the “2016 Plan”), the predecessor incentive plan at the time of the adoption of the 2018 Plan. Pursuant to the terms of the 2018 Plan, the Company is authorized to grant stock options, as well as awards of stock appreciation rights, restricted stock, unrestricted shares, restricted stock units (“RSUs”), stock equivalent units and performance-based cash awards. These awards may be granted to directors, officers, employees and eligible consultants. Vesting and the term of an option is determined at the discretion of the Company’s Board of Directors. Subsequent to the adoption of the 2018 Plan, the Company ceased granting awards under the 2016 Plan, the predecessor incentive plan. However, outstanding stock options granted prior to the effective date of the 2018 Plan are still governed by the 2016 Plan or the Company’s 2014 Stock Incentive Plan, which preceded the 2016 Plan.

As of September 30, 2020, there was an aggregate of 3,387,958 shares of common stock remaining available for grant under the Company’s 2018 Plan.

For the nine months ended September 30, 2020, the Company issued 809,590 stock options to employees and directors. The Company issued no stock options to consultants during the nine months ended September 30, 2020.

The following is a summary of the Company’s stock option activity during the nine months ended September 30, 2020:

				Weighted			Aggregate
	Number of			Average			Intrinsic Value
	Stock Options			Exercise Price			(in thousands)
Outstanding as of December 31, 2019		3,467,292		$	6.76		$	—
Granted		809,590			0.47			—
Forfeited/Cancelled		(346,938	)		(5.66	)		—
Exercised		—			—			—
Outstanding as of September 30, 2020		3,929,944		$	5.56		$	—
Exercisable as of September 30, 2020		2,449,829		$	4.27		$	—

As of September 30, 2020, the unrecognized compensation cost related to non-vested stock options outstanding for employees and directors, was $4.1 million which will be recognized over a weighted-average remaining vesting period of approximately 2.8 years. Compensation cost is not adjusted for estimated forfeitures, but instead is adjusted upon an actual forfeiture of a stock option.

	Nine Months Ended September 30, 2020
Stock price	$	0.47
Exercise price	$	0.47
Expected term	5.26 years
Expected volatility		77.35	%
Risk-free interest rate		0.58	%
Dividend rate		0.00	%

As of September 30, 2020, the unrecognized compensation cost related to non-vested stock options outstanding for non-employees was $15 thousand which will be recognized over a weighted-average remaining vesting period of approximately 0.9 years. Compensation cost is not adjusted for estimated forfeitures, but instead is adjusted upon an actual forfeiture of a stock option.

Restricted Stock Awards

Beginning in the fourth quarter of 2019, certain members of the Company’s executive management team elected to receive restricted stock awards in lieu of cash compensation under the 2018 Plan that vest upon issuance. The fair value of the restricted stock awards is based on the closing price of the Company’s common stock on the day of the grant.

The following is a summary of the Company’s restricted stock award activity for the nine months ended September 30, 2020:

	Number of Restricted Stock Units			Weighted Average Grant Date Fair Value per Unit
Outstanding as of December 31, 2019		27,697		$	0.61
Granted		218,161			0.50
Settled		(240,106	)		0.52
Outstanding as of September 30, 2020		5,752		$	0.39

Stock-Based Compensation Expense

Stock-based compensation expense is classified in the Company’s condensed consolidated statements of operations and comprehensive loss as follows (amounts in thousands):

	Three Months Ended September 30,					Nine Months Ended September 30,
	2020		2019			2020			2019
Research and development	$	245	$	233		$	727		$	643
Cost of sales		—		(6	)		(1	)		—
Selling, general and administrative		205		1,333			1,295			2,693
Total	$	450	$	1,560		$	2,021		$	3,336

Stock-based compensation expense for the three and nine months ended September 30, 2020 includes the reversal of $125 thousand of expense as a result of forfeitures due to the departure of our former chief executive officer in August 2020.

Common Stock and Warrants - Warrants Outstanding and Exercisable (Details)	9 Months Ended
	Sep. 30, 2020 $ / shares shares	Sep. 30, 2020 $ / shares shares
Class Of Warrant Or Right [Line Items]
Number of Warrants Outstanding	9,295,445	9,295,445
Warrants Expiration Date, December 22, 2020
Class Of Warrant Or Right [Line Items]
Number of Warrants Outstanding	270,915	270,915
Exercise price \| $ / shares	$ 12.25
Expiration Date	Dec. 22, 2020
Warrants Expiration Date, December 28, 2020
Class Of Warrant Or Right [Line Items]
Number of Warrants Outstanding	171,020	171,020
Exercise price \| $ / shares	$ 12.25
Expiration Date	Dec. 28, 2020
Warrants Expiration Date, December 29, 2020
Class Of Warrant Or Right [Line Items]
Number of Warrants Outstanding	204,081	204,081
Exercise price \| $ / shares	$ 12.25
Expiration Date	Dec. 29, 2020
Warrants Expiration Date, April 10, 2021
Class Of Warrant Or Right [Line Items]
Number of Warrants Outstanding	2,392,285	2,392,285
Exercise price \| $ / shares		$ 12.25
Expiration Date	Apr. 10, 2021
Warrants Expiration Date, March 20, 2025
Class Of Warrant Or Right [Line Items]
Number of Warrants Outstanding	6,257,144	6,257,144
Exercise price \| $ / shares	$ 0.46
Expiration Date	Mar. 20, 2025

Summary of Significant Accounting Policies - Summary of Recurring Fair Value Measurements for Derivative Financial Instruments and Stock-Based Compensation Liability (Details) - Fair Value, Measurements, Recurring - Black Scholes Model - Derivative Financial Instruments $ in Thousands	Dec. 31, 2019 USD ($)
Liabilities:
Fair value, liabilities	$ 5
Level 3
Liabilities:
Fair value, liabilities	$ 5

Commitments and Contingencies

9 Months Ended

Sep. 30, 2020

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

6. COMMITMENTS AND CONTINGENCIES

(a)

On January 22, 2013, the Company entered into a license agreement with Advanced NeuroRehabilitation, LLC (“ANR”) for an exclusive right to ANR’s patent pending technology, claims and knowhow. In addition to the issuance of 3,207,005 shares of common stock to ANR, the Company agreed to pay a 4% royalty on net revenue on the sales of devices covered by the patent-pending technology and services related to the therapy or use of devices covered by the patent-pending technology. For the three and nine months ended September 30, 2020, the Company recorded approximately $5 thousand and $15 thousand, respectively, in royalty expenses in its condensed consolidated statement of operations and comprehensive loss. For the three and nine months ended September 30, 2019, the Company recorded approximately $6 thousand and $52 thousand, respectively, in royalty expenses in its condensed consolidated statement of operations and comprehensive loss.

(b)

On October 30, 2017, HMI amended the Asset Purchase Agreement with A&B (HK) Company Ltd. (“A&B”) which specified that if the Company fails to obtain FDA marketing authorization for commercialization of or otherwise fails to ensure that the PoNS device is available for purchase by the U.S. Government by December 31, 2021, the Company would be subject to a $2.0 million contract penalty payable to A&B, unless the Company receives an exemption for the requirement of FDA marketing authorization from the U.S. Army Medical Material Agency. In December 2018, the U.S. Army notified the Company that it was amending the Agreement such that the satisfaction of the obligation of the contract was changed from FDA marketing authorization of the PoNS device to submitting of an application for marketing authorization of the PoNS device with the FDA. As the Company submitted its application for marketing authorization of the PoNS device to the FDA on August 31, 2018, and with copies of the submission documents provided to the U.S. Army, the Company has met its obligation under the amended agreement. Based on this amendment the Company has determined that the possibility of a payment under this contractual penalty is remote.

(c)

In March 2017, the Company entered into a lease for office space in Newtown, Pennsylvania. The initial term of the lease was from July 1, 2017 through December 31, 2022, with an option to extend until 2027. In July 2017, the Company amended the contract to commence the lease on July 17, 2017 through January 16, 2023, with an option to extend until January 2028. Lease extension options were not included in the lease term as it was not reasonably certain that the Company would elect to utilize the option to extend. Monthly rent plus utilities were approximately $20 thousand per month beginning in January 2018 with a 3% annual increase. In May 2020, the Company terminated its lease and entered into a new lease (the “Lease Amendment”) for a smaller footprint of the current office space in Newtown, Pennsylvania. Lease payments under the original contract will be made through December 2020. The Lease Amendment was determined to be a partial termination that qualified as a change of accounting of the existing lease and not a separate contract. As such, the ROU assets and operating lease liabilities were remeasured using an incremental borrowing rate at the date of modification. The carrying value of the ROU asset decreased on a basis proportionate to the partial termination by approximately $0.4 million and the related lease liability decreased by approximately $0.4 million. The Company recorded a gain of approximately $0.1 million resulting from the difference between the reduction in the lease liability and the proportionate reduction of the ROU asset. This amount is recorded as a component of other income in the condensed consolidated statement of operations and comprehensive loss for the nine months ended September 30, 2020. The initial lease term of the Lease Amendment is from July 1, 2020 through June 30, 2021, with options to extend for successive six month periods. Two lease extension options were included in the lease term as it was reasonably certain that the Company would elect to utilize the option to extend for this period of time. Monthly rent plus utilities will be approximately $5 thousand per month beginning in January 2021 with a 3% annual increase.

The following table summarizes the Company’s operating lease information including future minimum lease payments under a non-cancellable lease as of September 30, 2020 (amounts in thousands).

For the Nine Months Ended September 30, 2020
Operating lease cost	$	57
Operating lease - operating cash flows	$	189
Weighted average remaining lease term	1.75 years
Weighted average discount rate		7.2	%

Future minimum lease payments under non-cancellable lease as of September 30, 2020 were as follows:
For the Period Ending December 31,
2020 (remaining three months)	$	63
2021		63
2022		32
Total future minimum lease payments		158
Less imputed interest		(4	)
Total liability	$	154
Reported as of September 30, 2020
Current operating lease liability		107
Non-current operating lease liability		47
Total	$	154

(d)

On December 29, 2017, HMI (formerly known as NeuroHabilitation Corporation) entered into a Manufacturing and Supply Agreement (“MSA”) with Key Tronic Corporation (“Key Tronic”), for the manufacture and supply of the Company’s PoNS device based upon the Company’s product specifications as set forth in the MSA. Per the agreement, the Company shall provide to Key Tronic a rolling forecast for the procurement of parts and material and within normal lead times based on estimated delivery dates for the manufacture of the PoNS device. The term of the agreement is for three years and will automatically renew for additional consecutive terms of one year, unless cancelled by either party upon 180-day written notice to the other party prior to the end of the then current term. On June 1, 2020, HMI extended the existing manufacturing agreement with Key Tronic for a second three year term from December 29, 2020 until December 31, 2023. As of September 30, 2020, the Company did not have any outstanding commitments to Key Tronic to complete the Company’s forecasts for the procurement of materials necessary for the delivery of PoNS devices.

(e)

The Company was granted a $323 thousand loan on April 13, 2020 under the Paycheck Protection Program (the “PPP Loan”) established under the CARES Act. The Company planned to use the proceeds from the PPP Loan for covered payroll costs, rent and utilities in accordance with the relevant terms and conditions of the CARES Act. However, based upon subsequent guidance issued by the Federal Government, including a presumption that publicly traded companies may not be eligible for a PPP loan, the Company returned the PPP Loan proceeds in May 2020 and paid interest for the period of time the loan was outstanding.

Legal Contingencies

Caramahai v. Helius Medical Technologies, Inc. et al.

On or about July 9, 2019, a putative shareholder class action lawsuit, Caramahai v. Helius Medical Technologies, Inc. et al., Case No. 1:19-cv-06365 (S.D.N.Y.), was filed against the Company and three of its individual officers in the Southern District of New York (“the Caramahai Action”). The lawsuit alleges that the Company made materially false and misleading statements regarding the prospects for FDA approval of Helius’ application for de novo classification and clearance of its PoNS device in the United States. As a result of these alleged misstatements, the Caramahai Action asserts claims on behalf of shareholders who bought or sold Helius common stock between from November 9, 2017 to April 10, 2019 for alleged violations of the federal securities laws, specifically Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934, as amended.

On or about July 31, 2019, a putative shareholder class action lawsuit, Evans v. Helius Medical Technologies, Inc. et al., Case No. 1:19-cv-07171 (S.D.N.Y.), was filed against the Company and three of its individual officers in the Southern District of New York (the “Evans Action”). The Evans Action alleges similar claims as the Caramahai Action.

On September 9, 2019, three Helius shareholders each filed motions in the Caramahai and Evans cases seeking to consolidate the two proceedings into a single putative class action. The individual motions also sought to have the movant appointed as Lead Plaintiff (the plaintiff responsible for prosecuting the class’s claims and has the power to settle and release claims of all class members) and have the movant’s attorneys appointed as Lead Counsel. On September 13 and 17, 2019, respectively, two of the movants filed notices withdrawing their motions on the ground that they did not appear to have “the largest financial interest in the relief sought by the class.” The third movant was appointed Lead Plaintiff on April 28, 2020 and movant’s attorneys were appointed as Lead Counsel.

During the second quarter of 2020, the plaintiffs voluntarily dismissed the lawsuit without prejudice, ending the case. The U.S. District Judge signed the final order dismissing the litigation on July 1, 2020.

Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Payables And Accruals [Abstract]
Employees benefits	$ 557	$ 722
Professional services	6	67
Legal fees	163	81
Royalty fees	5	13
Franchise fees	40	28
Severance	550	606
Other	78	2
Total	$ 1,399	$ 1,519