0001144204-19-014453 | 10-Q/A | XBRL Viewer | Protalix Biotherapeutics INC

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2018	Aug. 01, 2018
Document and Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	true
Amendment Description	This Amendment No. 1 to Form 10-Q, or this Amendment, amends the Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2018 we originally filed with the Securities and Exchange Commission, or the Commission, on August 9, 2018, or the Original Filing, in connection with the recognition in this Amendment of revenue from a license agreement that was not recognized previously. All amendments and restatements to the financial statements are non-cash in nature.
Document Period End Date	Jun. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q2
Entity Registrant Name	Protalix BioTherapeutics, Inc.
Entity Central Index Key	0001006281
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Trading Symbol	PLX
Entity Common Stock, Shares Outstanding		148,183,591
Entity Emerging Growth Company	false
Entity Small Business	false

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
CURRENT ASSETS:
Cash and cash equivalents	$ 28,327	$ 51,163
Accounts receivable - Trade	5,248	1,721
Other assets	2,499	1,934
Inventories	6,978	7,833
Total current assets	43,052	62,651
FUNDS IN RESPECT OF EMPLOYEE RIGHTS UPON RETIREMENT	1,729	1,887
PROPERTY AND EQUIPMENT, NET	6,940	7,676
Total assets	51,721	72,214
Accounts payable and accruals:
Trade	6,001	7,521
Other	9,071	9,310
Contracts liability	3,420
Convertible notes		5,921
Total current liabilities	18,492	22,752
LONG TERM LIABILITIES:
Convertible notes	46,742	46,267
Contracts liability	21,636	25,015
Liability for employee rights upon retirement	2,335	2,586
Other long term liabilities	5,258	5,051
Total long term liabilities	75,971	78,919
Total liabilities	94,463	101,671
COMMITMENTS
CAPITAL DEFICIENCY	(42,742)	(29,457)
Total liabilities net of capital deficiency	$ 51,721	$ 72,214

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
$ in Thousands

3 Months Ended

6 Months Ended

Jun. 30, 2018

Jun. 30, 2017

Jun. 30, 2018

Jun. 30, 2017

COST OF GOODS SOLD

$ (2,183)

$ (5,523)

$ (5,107)

$ (7,611)

RESEARCH AND DEVELOPMENT EXPENSES

^[1]

(7,476)

(9,304)

(14,762)

(15,271)

Less - grants

235

478

1,078

1,816

RESEARCH AND DEVELOPMENT EXPENSES, NET

(7,241)

(8,826)

(13,684)

(13,455)

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

^[1]

(2,158)

(2,814)

(4,656)

(5,351)

OPERATING LOSS

(6,744)

(10,805)

(11,895)

(17,170)

FINANCIAL EXPENSES

(1,793)

(3,045)

(4,013)

(5,132)

FINANCIAL INCOME

207

1,665

(LOSS) INCOME FROM CHANGE IN FAIR VALUE OF CONVERTIBLE NOTES EMBEDDED DERIVATIVE

14,260

(38,061)

FINANCIAL (EXPENSES) INCOME, NET

(1,718)

11,255

(3,806)

(41,528)

NET (LOSS) INCOME FOR THE PERIOD

$ (8,462)

$ 450

$ (15,701)

$ (58,698)

BASIC

Net (loss) earnings per share of common stock

$ (0.06)

$ 0.00

$ (0.11)

$ (0.47)

DILUTED

Net loss per share of common stock

$ (0.06)

$ (0.11)

$ (0.47)

WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK USED IN COMPUTING (LOSS) EARNINGS PER SHARE

BASIC

146,644,450

127,523,706

145,985,445

126,000,782

DILUTED

146,644,450

192,598,389

145,985,445

126,000,782

Goods [Member]

REVENUES

$ 2,006

$ 6,358

$ 6,559

$ 9,247

License and R&D Services [Member]

REVENUES

$ 2,832

$ 4,993

[1]	Includes share-based compensation

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (CAPITAL DEFICIENCY) - USD ($)
$ in Thousands

Total

Common Stock [Member]

Additional Paid-in Capital [Member]

Accumulated Deficit [Member]

Balance at Dec. 31, 2016

$ (9,957)

$ 124

$ 202,575

$ (212,656)

Balance (in shares) at Dec. 31, 2016

^[1]

124,134,085

Share-based compensation related to stock options

216

Reclassification of embedded derivative

43,634

Convertible notes conversions

4,137

$ 5

4,132

Convertible notes conversions (in shares)

^[1]

4,948,821

Net loss for the period

(58,698)

Balance at Jun. 30, 2017

(20,668)

$ 129

250,557

(271,354)

Balance (in shares) at Jun. 30, 2017

^[1]

129,082,906

Balance at Dec. 31, 2017

(29,457)

$ 144

266,495

(296,096)

Balance (in shares) at Dec. 31, 2017

^[1]

143,728,797

Share-based compensation related to stock options

Share-based compensation related to restricted stock award

^[2]

Share-based compensation related to restricted stock award (in shares)

^[1]

29,898

Convertible notes conversions

1,192

$ 2

1,190

Convertible notes conversions (in shares)

^[1]

1,811,260

Convertible notes exchange

1,150

$ 2

1,148

Convertible notes exchange (in shares)

^[1]

2,613,636

Net loss for the period

(15,701)

Balance at Jun. 30, 2018

$ (42,742)

$ 148

$ 268,907

$ (311,797)

Balance (in shares) at Jun. 30, 2018

^[1]

148,183,591

[1]	Common Stock, $0.001 par value; Authorized – as of June 30, 2018 and 2017 - 250,000,000.
[2]	Represents an amount less than $1.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (15,701)	$ (58,698)
Adjustments required to reconcile net loss to net cash used in operating activities:
Share based compensation	74	216
Depreciation	846	986
Financial expenses, net (mainly exchange differences)	94	56
Changes in accrued liability for employee rights upon retirement	(121)	89
Gain on amounts funded in respect of employee rights upon retirement	(43)	(19)
Net loss (income) in connection with conversions of convertible notes	186	(739)
Change in fair value of convertible notes embedded derivative		38,061
Amortization of debt issuance costs and debt discount	1,257	1,141
Issuance of shares for interest payment in connection with conversions of convertible notes	205	634
Changes in operating assets and liabilities:
Increase in contracts liability (including non-current portion)	41	1,088
Increase in accounts receivable and other assets	(3,989)	(3,538)
Decrease (increase) in inventories	855	(1,814)
Increase (decrease) in accounts payable and accruals	(1,288)	5,378
Increase in other long term liabilities	207
Net cash used in continuing operations	(17,377)	(17,159)
Net cash provided by discontinued operations		114
Net cash used in operating activities	(17,377)	(17,045)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment	(394)	(543)
Increase in restricted deposit	(162)	(343)
Amounts funded in respect of employee rights upon retirement, net	109	(83)
Net cash used in investing activities	(447)	(969)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net payment for convertible notes	(4,752)	(10,961)
Net cash used in financing activities	(4,752)	(10,961)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	(260)	227
NET DECREASE IN CASH AND CASH EQUIVALENTS	(22,836)	(28,748)
BALANCE OF CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	51,163	63,281
BALANCE OF CASH AND CASH EQUIVALENTS AT END OF PERIOD	28,327	34,533
SUPPLEMENTARY INFORMATION ON INVESTING AND FINANCING ACTIVITIES NOT INVOLVING CASH FLOWS:
Purchase of property and equipment	242	493
Convertible notes conversions	2,137	3,503
SUPPLEMENTARY DISCLOSURE ON CASH FLOWS
Interest paid	$ 2,408	$ 2,330

SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

SIGNIFICANT ACCOUNTING POLICIES

NOTE 1

- SIGNIFICANT ACCOUNTING POLICIES

General

Protalix BioTherapeutics, Inc. (collectively with its subsidiaries, the “Company”), and its wholly-owned subsidiaries, Protalix Ltd. and Protalix B.V. (the “Subsidiaries”), are biopharmaceutical companies focused on the development and commercialization of recombinant therapeutic proteins based on the Company’s proprietary ProCellEx

protein expression system (“ProCellEx”). To date, the Company has successfully developed taliglucerase alfa (marketed under the name alfataliglicerase in Brazil and certain other Latin American countries and Elelyso

in the rest of the territories) for the treatment of Gaucher disease that has been approved for marketing in the United States, Brazil, Israel and other markets. The Company has a number of product candidates in varying stages of the clinical development process. The Company’s current strategy is to develop proprietary recombinant proteins that are therapeutically superior to existing recombinant proteins currently marketed for the same indications.

The Company’s product pipeline currently includes, among other candidates:

(1) pegunigalsidase alfa, or PRX-102, a therapeutic protein candidate for the treatment of Fabry disease, a rare, genetic lysosomal disorder;

(2) alidornase alfa, or PRX-110, a proprietary plant cell recombinant human Deoxyribonuclease 1, or DNase, under development for the treatment of Cystic Fibrosis, to be administered by inhalation; and

(3) OPRX-106, the Company’s oral antiTNF product candidate which is being developed as an orally-delivered anti-inflammatory treatment using plant cells as a natural capsule for the expressed protein.

Obtaining marketing approval with respect to any product candidate in any country is directly dependent on the Company’s ability to implement the necessary regulatory steps required to obtain such approvals. The Company cannot reasonably predict the outcome of these activities.

Since its approval by the FDA, taliglucerase alfa has been marketed by Pfizer Inc. (“Pfizer”), as provided in the exclusive license and supply agreement by and between Protalix Ltd. and Pfizer, which is referred to herein as the Pfizer Agreement. In October 2015, the Company entered into an Amended and Restated Exclusive License and Supply Agreement (the “Amended Pfizer Agreement”) which amends and restates the Pfizer Agreement in its entirety. Pursuant to the Amended Pfizer Agreement, the Company sold to Pfizer its share in the collaboration created under the Pfizer Agreement for the commercialization of Elelyso in exchange for a cash payment equal to $36.0 million. As part of the sale, the Company agreed to transfer its rights to Elelyso in Israel to Pfizer while gaining full rights to it in Brazil. Under the Amended Pfizer Agreement, Pfizer is entitled to all of the revenues, and is responsible for 100% of expenses globally for Elelyso, excluding Brazil where the Company is responsible for all expenses and retains all revenues.

On June 18, 2013, the Company entered into a Supply and Technology Transfer Agreement (the “Brazil Agreement”) with Fundação Oswaldo Cruz (“Fiocruz”), an arm of the Brazilian Ministry of Health (the “Brazilian MoH”), for taliglucerase alfa. Fiocruz’s purchases of alfataliglicerase to date have been significantly below certain agreed upon purchase milestones and, accordingly, the Company has the right to terminate the Brazil Agreement. Notwithstanding, the Company is, at this time, continuing to supply alfataliglicerase to Fiocruz under the Brazil Agreement, and patients continue to be treated with alfataliglicerase in Brazil. Approximately 10% of adult Gaucher patients in Brazil are currently treated with alfataliglicerase. The Company is discussing with Fiocruz potential actions that Fiocruz may take to comply with its purchase obligations and, based on such discussions, the Company will determine what it believes to be the course of action that is in the best interest of the Company.

In 2017, the Company received a purchase order from the Brazilian MoH for the purchase of alfataliglicerase for the treatment of Gaucher patients in Brazil for consideration of approximately $24.3 million. Shipments started in June 2017. The Company recorded revenues of $7.1 million for sales of alfataliglicerase to Fiocruz in 2017, and $2.6 million during the six months ended June 30, 2018.

On October 19, 2017, Protalix Ltd. and Chiesi Farmaceutici S.p.A. (“Chiesi”) entered into an Ex-US license (the “Chiesi Agreement”) pursuant to which Chiesi was granted an exclusive license for all markets outside of the United States to commercialize pegunigalsidase alfa. Under the terms and conditions of the Chiesi Agreement, Protalix Ltd. retained the right to commercialize pegunigalsidase in the United States.

Under the Chiesi Agreement, Chiesi made an upfront payment to Protalix Ltd. of $25.0 million in connection with the execution of the agreement and Protalix Ltd. is entitled to additional payments of up to $25.0 million in development costs, capped at $10.0 million per year. Protalix Ltd. is also eligible to receive additional payments of up to $320.0 million, in the aggregate, in regulatory and commercial milestone payments.

Under the terms of the Chiesi Agreement, Protalix Ltd. will manufacture all of the PRX-102 needed for all purposes under the agreement, subject to certain exceptions, and Chiesi will purchase pegunigalsidase alfa from Protalix, subject to certain terms and conditions. Chiesi will make tiered payments of 15% to 35% of its net sales, depending on the amount of annual sales, as consideration for the supply of pegunigalsidase alfa.

Based on its current cash resources and commitments, the Company believes it will be able to maintain its current planned development activities and the corresponding level of expenditures for at least 12 months from the date of approval of the June 30, 2018 financial statements, although no assurance can be given that it will not need additional funds prior to such time. If there are unexpected increases in general and administrative expenses or research and development expenses, the Company may need to seek additional financing.

Basis of presentation

Restatement of previously issued condensed consolidated financial statements

The Company has restated these financial statements to correct an error in the revenue recognition from the Chiesi Agreement. Previously, the Company had identified a single performance obligation with regard to its promises under the agreement. The Company subsequently concluded that there are two performance obligations under the agreement as follows: (i) the license together with research and development services and (ii) a contingent performance obligation regarding future manufacturing. As such, the Company has recognized revenue for the combined performance obligation (the license and the research and development services) for the three and six months ended June 30, 2018 for the satisfaction of the performance obligation that occurred during the three and six months ended June 30, 2018.

The Company’s decision to restate the financial statements previously reported on its Quarterly Reports on Form 10-Q, was approved by, and with the continuing oversight of, the Company’s Audit Committee.

Impacts of restatement

The effects of the restatement on the line items within the Company’s condensed consolidated balance sheets as of June 30, 2018 are as follows:

	June 30, 2018
( U.S. dollars in thousands)	As originally reported			Adjustments			As restated
CURRENT LIABILITIES:
Contracts liability		-			3,420			3,420
Total current liabilities	$	15,072		$	3,420		$	18,492
LONG TERM LIABILITIES:
Contracts liability		31,885			(10,249	)		21,636
Total long term liabilities		86,220			(10,249	)		75,971
Total liabilities		101,292			(6,829	)		94,463
CAPITAL DEFICIENCY	$	(49,571	)	$	6,829		$	(42,742	)

The effects of the restatement on the line items within the Company’s condensed consolidated statements of operations for the three months and six months ended June 30, 2018 are as follows:

	Three Months Ended June 30, 2018								Six Months Ended June 30, 2018
( U.S. dollars in thousands, except per share data)	As originally reported			Adjustments		As restated			As originally reported			Adjustments		As restated
REVENUES FROM LICENSE AGREEMENTS	$	-		$	2,832	$	2,832		$	-		$	4,993	$	4,993
OPERATING LOSS		(9,576	)		2,832		(6,744	)		(16,888	)		4,993		(11,895	)
LOSS FOR THE PERIOD		(11,294	)		2,832		(8,462	)		(20,694	)		4,993		(15,701	)
Net loss per share of common stock-basic and diluted	$	(0.08	)	$	0.02	$	(0.06	)	$	(0.14	)	$	0.03	$	(0.11	)

The effects of the restatement on the line items within the Company’s condensed consolidated statements of changes in capital deficiency for the six months ended June 30, 2018 are as follows:

	Six Months Ended June 30, 2018
( U.S. dollars in thousands)	As originally reported			Adjustments		As restated
Net loss for the six months ended June 30, 2018	$	(20,694	)	$	4,993	$	(15,701	)
Balances as of June 30, 2018
Accumulated deficit		(318,626	)		6,829		(311,797	)
Total capital deficiency	$	(49,571	)	$	6,829	$	(42,742	)

Although there was with no impact to net cash provided by operating activities, net cash used in investing activities or net cash used in financing activities, the effects of the restatement on the line items within the condensed consolidated statements of cash flows for the six months ended June 30, 2018 are as follows:

	Six Months Ended June 30, 2018
( U.S. dollars in thousands)	As originally reported			Adjustments			As restated
Cash flows from operating activities:
Net loss	$	(20,694	)	$	4,993			(15,701	)
Increase in contracts liability		5,034			(4,993	)		41
Net cash used in operating activities	$	(17,377	)	$	-		$	(17,377	)

The impacts of the restatement have been reflected throughout the financial statements, including the applicable footnotes, as appropriate.

In addition, in connection with the agreement with Chiesi, the Company should have recognized $1.8 million of revenue in the last quarter of 2017 and accordingly has revised certain items in its consolidated financial statements for December 31, 2017 presented herein. The Company evaluated the materiality of the error from quantitative and qualitative perspectives, and concluded that the error was immaterial to the Company’s prior annual consolidated financial statements. Since the revision was not material to any prior interim period or annual consolidated financial statements, no amendments to previously filed interim or annual periodic reports was required. Consequently, the Company revised the historical consolidated financial information presented herein. Below are amounts as reported and as adjusted for December 31, 2017:

	December 31, 2017
(U.S. dollars in thousands)	As originally reported			Adjustments			As revised
Contracts liability	$	26,851		$	(1,836	)	$	25,015
Accumulated deficit		(297,932	)		1,836			(296,096	)

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for annual financial statements. In the opinion of management, all adjustments (of a normal recurring nature) considered necessary for a fair statement of the results for the interim periods presented have been included. Operating results for the interim period are not necessarily indicative of the results that may be expected for the full year.

These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements in the Annual Report on Form 10-K for the year ended December 31, 2017, filed by the Company with the Commission. The comparative balance sheet at December 31, 2017 has been derived from the audited financial statements at that date.

Net loss per share

Basic (loss) earnings per share (“LPS”) are computed by dividing net loss (income) by the weighted average number of shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), outstanding for each period.

Diluted loss per share is calculated by dividing the net income by the weighted-average number of shares of Common Stock outstanding during each period increased to include the number of additional shares of Common Stock that would have been outstanding if the potentially dilutive shares had been issued. Potentially dilutive shares include additional shares of Common Stock issuable upon the assumed conversion of the convertible notes (issued in September 2013 and December 2016).

The loss and weighted average number of shares outstanding used to calculate (loss) earnings per share were as follows:

	Six Months Ended						Three Months Ended
	June 30, 2018			June 30, 2017			June 30, 2018			June 30, 2017
( U.S. dollars in thousands, except share amounts)	(as restated)			(as restated)
Net loss (income) for the period	$	(15,701	)	$	(58,698	)	$	(8,462	)	$	450
Financial income, net of convertible notes		-			-			-		$	(11,847	)
Loss used for the computation of diluted loss per share	$	(15,701	)	$	(58,698	)	$	(8,462	)	$	(11,397	)
Weighted average shares of common stock outstanding for basic calculation		145,985,445			126,000,782			146,644,450			127,523,706
Weighted average dilutive effect of shares issuable upon conversion of convertible notes		-			-			-			65,066,683
Weighted average dilutive effect of stock options		-			-			-			8,000
Weighted average shares of common stock outstanding for diluted calculation		145,985,445			126,000,782			146,644,450			192,598,389

Diluted

LPS is calculated in continuing

operations. The calculation of diluted LPS does not include 74,087,411 and 73,306,448 shares of Common Stock underlying outstanding options and restricted shares of Common Stock and shares issuable upon conversion of the convertible notes (issued in September 2013 and December 2016) for the six months ended June 30, 2017 and 2018, respectively, and 72,836,697 shares of Common Stock for the three months ended June 30, 2018 because the effect would be anti-dilutive. The calculation of diluted LPS does not include 5,059,186 shares of Common Stock underlying outstanding options for the three months ended June 30, 2017, because the effect would be anti-dilutive.

Revenue recognition (as restated)

Revenues from supply agreements

The Company recognizes revenues from supply agreements and from selling products when control is transferred to the customer and collectability is probable.

Revenue from Chiesi Agreement

According to Accounting Standard Codification Topic 606, Revenue from contracts with customers (“ASC 606”), a performance obligation is a commitment to provide a distinct good or service or a series of distinct goods or services. Goods and services that are not distinct are bundled with other goods or services in the contract until a bundle of goods or services that is distinct is created. A good or service promised to a customer is distinct if the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer and the entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract.

The Company has identified two performance obligations in the Chiesi Agreement as follows: (1) the license and research and development services and (2) a contingent performance obligation regarding future manufacturing.

The Company determined that the license together with the research and development services should be combined into single performance obligation since Chiesi cannot benefit from the license without the research and development services. The research and development services are highly specialized and are dependent on the supply of the drug.

The future manufacturing is contingent on regulatory approvals of the drug and the Company deems these services to be separately identifiable from other performance obligations in the contract. Manufacturing services post-regulatory approval are not interdependent or interrelated with the license and research and development services.

The transaction price was comprised of fixed consideration and variable consideration (capped research and development reimbursements). Under ASC 606, the consideration to which the Company would be entitled upon the achievement of contractual milestones, which are contingent upon the occurrence of future events, are a form of variable consideration. The Company estimates variable consideration using the most likely method. Amounts included in the transaction price are recognized only when it is probable that a significant reversal of cumulative revenues will not occur, usually upon achievement of a specific milestone. The Company used significant judgment when it determined variable consideration.

Since the customer benefits from the research and development services as the entity performs, revenue from granting the license and the research and development services is recognized over time using the cost-to-cost method. The Company used significant judgment when it determined the costs expected to be incurred upon satisfying the identified performance obligation.

Revenue from additional research and development services ordered by Chiesi, is recognized over time using the cost-to-cost method.

The Company’s revenue recognition accounting policy prior to January 1, 2018, was materially the same.

Recently adopted standards

In May 2014, the Financial Accounting Standards Board (“FASB”) issued guidance on revenues from contracts with customers that will supersede most current revenue recognition guidance, including industry-specific guidance. The underlying principle is to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled to in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. Other major provisions require capitalization of certain contracts costs, consideration of the time value of money in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The guidance also requires enhanced disclosures regarding the nature, amount timing and uncertainty of revenues and cash flows arising from an entity’s contracts with customers. The guidance is effective for the interim and annual periods beginning on or after December 15, 2017. On January 1, 2018, the Company adopted the new accounting standard, ASC 606, Revenue from Contracts with Customers, and all the related amendments, using the modified retrospective method. The implementation of this Accounting Standards Update (ASU) did not have a material impact on the Company’s consolidated financial statements.

In January 2016, the FASB issued ASU, No. 2016-01, Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. The guidance affects the accounting for equity investments, financial liabilities under the fair value option and the presentation and disclosure requirements of financial instruments. The guidance is effective for annual reporting periods beginning after December 15, 2017. The implementation of this ASU did not have a material impact on the Company’s consolidated financial statements.

SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

General

The Company’s product pipeline currently includes, among other candidates:

(1) pegunigalsidase alfa, or PRX-102, a therapeutic protein candidate for the treatment of Fabry disease, a rare, genetic lysosomal disorder;

Basis of presentation

Restatement of previously issued condensed consolidated financial statements

Impacts of restatement

The effects of the restatement on the line items within the Company’s condensed consolidated balance sheets as of June 30, 2018 are as follows:

	June 30, 2018
( U.S. dollars in thousands)	As originally reported			Adjustments			As restated
CURRENT LIABILITIES:
Contracts liability		-			3,420			3,420
Total current liabilities	$	15,072		$	3,420		$	18,492
LONG TERM LIABILITIES:
Contracts liability		31,885			(10,249	)		21,636
Total long term liabilities		86,220			(10,249	)		75,971
Total liabilities		101,292			(6,829	)		94,463
CAPITAL DEFICIENCY	$	(49,571	)	$	6,829		$	(42,742	)

The effects of the restatement on the line items within the Company’s condensed consolidated statements of operations for the three months and six months ended June 30, 2018 are as follows:

	Three Months Ended June 30, 2018								Six Months Ended June 30, 2018
( U.S. dollars in thousands, except per share data)	As originally reported			Adjustments		As restated			As originally reported			Adjustments		As restated
REVENUES FROM LICENSE AGREEMENTS	$	-		$	2,832	$	2,832		$	-		$	4,993	$	4,993
OPERATING LOSS		(9,576	)		2,832		(6,744	)		(16,888	)		4,993		(11,895	)
LOSS FOR THE PERIOD		(11,294	)		2,832		(8,462	)		(20,694	)		4,993		(15,701	)
Net loss per share of common stock-basic and diluted	$	(0.08	)	$	0.02	$	(0.06	)	$	(0.14	)	$	0.03	$	(0.11	)

The effects of the restatement on the line items within the Company’s condensed consolidated statements of changes in capital deficiency for the six months ended June 30, 2018 are as follows:

	Six Months Ended June 30, 2018
( U.S. dollars in thousands)	As originally reported			Adjustments		As restated
Net loss for the six months ended June 30, 2018	$	(20,694	)	$	4,993	$	(15,701	)
Balances as of June 30, 2018
Accumulated deficit		(318,626	)		6,829		(311,797	)
Total capital deficiency	$	(49,571	)	$	6,829	$	(42,742	)

	Six Months Ended June 30, 2018
( U.S. dollars in thousands)	As originally reported			Adjustments			As restated
Cash flows from operating activities:
Net loss	$	(20,694	)	$	4,993			(15,701	)
Increase in contracts liability		5,034			(4,993	)		41
Net cash used in operating activities	$	(17,377	)	$	-		$	(17,377	)

The impacts of the restatement have been reflected throughout the financial statements, including the applicable footnotes, as appropriate.

	December 31, 2017
(U.S. dollars in thousands)	As originally reported			Adjustments			As revised
Contracts liability	$	26,851		$	(1,836	)	$	25,015
Accumulated deficit		(297,932	)		1,836			(296,096	)

Net loss per share

The loss and weighted average number of shares outstanding used to calculate (loss) earnings per share were as follows:

	Six Months Ended						Three Months Ended
	June 30, 2018			June 30, 2017			June 30, 2018			June 30, 2017
( U.S. dollars in thousands, except share amounts)	(as restated)			(as restated)
Net loss (income) for the period	$	(15,701	)	$	(58,698	)	$	(8,462	)	$	450
Financial income, net of convertible notes		-			-			-		$	(11,847	)
Loss used for the computation of diluted loss per share	$	(15,701	)	$	(58,698	)	$	(8,462	)	$	(11,397	)
Weighted average shares of common stock outstanding for basic calculation		145,985,445			126,000,782			146,644,450			127,523,706
Weighted average dilutive effect of shares issuable upon conversion of convertible notes		-			-			-			65,066,683
Weighted average dilutive effect of stock options		-			-			-			8,000
Weighted average shares of common stock outstanding for diluted calculation		145,985,445			126,000,782			146,644,450			192,598,389

Diluted

LPS is calculated in continuing

Revenue Recognition

Revenue recognition (as restated)

Revenues from supply agreements

The Company recognizes revenues from supply agreements and from selling products when control is transferred to the customer and collectability is probable.

Revenue from Chiesi Agreement

Revenue from additional research and development services ordered by Chiesi, is recognized over time using the cost-to-cost method.

The Company’s revenue recognition accounting policy prior to January 1, 2018, was materially the same.

Recently adopted standards

SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

Schedule of Error Corrections and Prior Period Adjustments [Table Text Block]

The effects of the restatement on the line items within the Company’s condensed consolidated balance sheets as of June 30, 2018 are as follows:

	June 30, 2018
( U.S. dollars in thousands)	As originally reported			Adjustments			As restated
CURRENT LIABILITIES:
Contracts liability		-			3,420			3,420
Total current liabilities	$	15,072		$	3,420		$	18,492
LONG TERM LIABILITIES:
Contracts liability		31,885			(10,249	)		21,636
Total long term liabilities		86,220			(10,249	)		75,971
Total liabilities		101,292			(6,829	)		94,463
CAPITAL DEFICIENCY	$	(49,571	)	$	6,829		$	(42,742	)

The effects of the restatement on the line items within the Company’s condensed consolidated statements of operations for the three months and six months ended June 30, 2018 are as follows:

	Three Months Ended June 30, 2018								Six Months Ended June 30, 2018
( U.S. dollars in thousands, except per share data)	As originally reported			Adjustments		As restated			As originally reported			Adjustments		As restated
REVENUES FROM LICENSE AGREEMENTS	$	-		$	2,832	$	2,832		$	-		$	4,993	$	4,993
OPERATING LOSS		(9,576	)		2,832		(6,744	)		(16,888	)		4,993		(11,895	)
LOSS FOR THE PERIOD		(11,294	)		2,832		(8,462	)		(20,694	)		4,993		(15,701	)
Net loss per share of common stock-basic and diluted	$	(0.08	)	$	0.02	$	(0.06	)	$	(0.14	)	$	0.03	$	(0.11	)

The effects of the restatement on the line items within the Company’s condensed consolidated statements of changes in capital deficiency for the six months ended June 30, 2018 are as follows:

	Six Months Ended June 30, 2018
( U.S. dollars in thousands)	As originally reported			Adjustments		As restated
Net loss for the six months ended June 30, 2018	$	(20,694	)	$	4,993	$	(15,701	)
Balances as of June 30, 2018
Accumulated deficit		(318,626	)		6,829		(311,797	)
Total capital deficiency	$	(49,571	)	$	6,829	$	(42,742	)

	Six Months Ended June 30, 2018
( U.S. dollars in thousands)	As originally reported			Adjustments			As restated
Cash flows from operating activities:
Net loss	$	(20,694	)	$	4,993			(15,701	)
Increase in contracts liability		5,034			(4,993	)		41
Net cash used in operating activities	$	(17,377	)	$	-		$	(17,377	)

The impacts of the restatement have been reflected throughout the financial statements, including the applicable footnotes, as appropriate.

	December 31, 2017
(U.S. dollars in thousands)	As originally reported			Adjustments			As revised
Contracts liability	$	26,851		$	(1,836	)	$	25,015
Accumulated deficit		(297,932	)		1,836			(296,096	)

The loss and weighted average number of shares outstanding used to calculate (loss) earnings per share were as follows:

	Six Months Ended						Three Months Ended
	June 30, 2018			June 30, 2017			June 30, 2018			June 30, 2017
( U.S. dollars in thousands, except share amounts)	(as restated)			(as restated)
Net loss (income) for the period	$	(15,701	)	$	(58,698	)	$	(8,462	)	$	450
Financial income, net of convertible notes		-			-			-		$	(11,847	)
Loss used for the computation of diluted loss per share	$	(15,701	)	$	(58,698	)	$	(8,462	)	$	(11,397	)
Weighted average shares of common stock outstanding for basic calculation		145,985,445			126,000,782			146,644,450			127,523,706
Weighted average dilutive effect of shares issuable upon conversion of convertible notes		-			-			-			65,066,683
Weighted average dilutive effect of stock options		-			-			-			8,000
Weighted average shares of common stock outstanding for diluted calculation		145,985,445			126,000,782			146,644,450			192,598,389

SIGNIFICANT ACCOUNTING POLICIES (Condensed consolidated balance sheets) (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017	Dec. 31, 2016
CURRENT LIABILITIES:
Contracts liability	$ 3,420
Total current liabilities	18,492	22,752
LONG TERM LIABILITIES:
Contracts liability	21,636	25,015
Total long term liabilities	75,971	78,919
Total liabilities	94,463	101,671
CAPITAL DEFICIENCY	(42,742)	(29,457)	$ (20,668)	$ (9,957)
Previously Reported [Member]
CURRENT LIABILITIES:
Contracts liability	0
Total current liabilities	15,072
LONG TERM LIABILITIES:
Contracts liability	31,885	26,851
Total long term liabilities	86,220
Total liabilities	101,292
CAPITAL DEFICIENCY	(49,571)
Restatement Adjustment [Member]
CURRENT LIABILITIES:
Contracts liability	3,420
Total current liabilities	3,420
LONG TERM LIABILITIES:
Contracts liability	(10,249)	$ (1,836)
Total long term liabilities	(10,249)
Total liabilities	(6,829)
CAPITAL DEFICIENCY	$ 6,829

SIGNIFICANT ACCOUNTING POLICIES (Condensed consolidated statements of operations) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Significant Accounting Policies [Line Items]
OPERATING LOSS	$ (6,744)	$ (10,805)	$ (11,895)	$ (17,170)
LOSS FOR THE PERIOD	$ (8,462)	450	$ (15,701)	(58,698)
Net loss per share of common stock-basic and diluted	$ (0.06)		$ (0.11)
License and Service [Member]
Significant Accounting Policies [Line Items]
REVENUES FROM LICENSE AGREEMENTS	$ 2,832		$ 4,993
Previously Reported [Member]
Significant Accounting Policies [Line Items]
OPERATING LOSS	(9,576)		(16,888)
LOSS FOR THE PERIOD	$ (11,294)		$ (20,694)
Net loss per share of common stock-basic and diluted	$ (0.08)		$ (0.14)
Previously Reported [Member] \| License and Service [Member]
Significant Accounting Policies [Line Items]
REVENUES FROM LICENSE AGREEMENTS	$ 0		$ 0
Restatement Adjustment [Member]
Significant Accounting Policies [Line Items]
OPERATING LOSS	2,832		4,993
LOSS FOR THE PERIOD	$ 2,832		$ 4,993
Net loss per share of common stock-basic and diluted	$ 0.02		$ 0.03
Restatement Adjustment [Member] \| License and Service [Member]
Significant Accounting Policies [Line Items]
REVENUES FROM LICENSE AGREEMENTS	$ 2,832		$ 4,993

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

SIGNIFICANT ACCOUNTING POLICIES (Net (loss) earnings per share) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Net loss (income) for the period	$ (8,462)	$ 450	$ (15,701)	$ (58,698)
Financial income, net of convertible notes	0	(11,847)	0	0
Loss used for the computation of diluted loss per share	$ (8,462)	$ (11,397)	$ (15,701)	$ (58,698)
Weighted average shares of common stock outstanding for basic calculation	146,644,450	127,523,706	145,985,445	126,000,782
Weighted average dilutive effect of shares issuable upon conversion of convertible notes	0	65,066,683	0	0
Weighted average dilutive effect of stock options	0	8,000	0	0
Weighted average shares of common stock outstanding for diluted calculation	146,644,450	192,598,389	145,985,445	126,000,782

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions	1 Months Ended		3 Months Ended			6 Months Ended
	Oct. 19, 2017	Oct. 31, 2015	Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Significant Accounting Policies [Line Items]
Common Stock, Par or Stated Value Per Share			$ 0.001	$ 0.001	$ 0.001	$ 0.001	$ 0.001
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount			72,836,697		5,059,186	73,306,448	74,087,411
Maximum [Member]
Significant Accounting Policies [Line Items]
Additional AmountPayable For Achievement Of Regulatory And Commercial Milestones	$ 320.0
Brazil [Member]
Significant Accounting Policies [Line Items]
Percentage Of Adult Gaucher Patients Treated With alfataliglicerase						10.00%
Brazil Agreement [Member]
Significant Accounting Policies [Line Items]
Supply Commitment In Year 2017				$ 24.3
Pfizer Agreement [Member]
Significant Accounting Policies [Line Items]
Proceeds From Exchange For Rights To Royalties		$ 36.0
Amended Pfizer Agreement [Member] \| Protalix Bio Therapeutics Incorporation [Member] \| Brazil [Member]
Significant Accounting Policies [Line Items]
Collaborative Arrangement Revenues and Expenses Sharing Percentage		100.00%
Chiesi Agreement [Member]
Significant Accounting Policies [Line Items]
Upfront Nonrefundable Noncreditable Payment Receivable	25.0
Additional Amounts Payable To Cover Development Costs	25.0
Maximum Entitlement Of Development Costs To Cover Per Year	$ 10.0
Revenues				$ 1.8
Chiesi Agreement [Member] \| Minimum [Member]
Significant Accounting Policies [Line Items]
Payment On Net Sales Percentage	15.00%
Chiesi Agreement [Member] \| Maximum [Member]
Significant Accounting Policies [Line Items]
Payment On Net Sales Percentage	35.00%
Fiocruz [Member]
Significant Accounting Policies [Line Items]
Revenues						$ 2.6	$ 7.1

CONVERTIBLE NOTES (Narrative) (Details) - USD ($)	6 Months Ended
CONVERTIBLE NOTES (Narrative) (Details) - USD ($)	Jun. 30, 2018	Jun. 30, 2017
Repayments of Convertible Debt	$ 4,752,000	$ 10,961,000
Debt Conversion, Converted Instrument, Amount	$ 2,137,000	$ 3,503,000
2013 Notes [Member]
Debt Conversion, Converted Instrument, Shares Issued	2,613,636
Repayments of Convertible Debt	$ 2,200,000
Debt Conversion, Converted Instrument, Amount	$ 3,420,000
Debt Instrument, Interest Rate, Stated Percentage	4.50%
2016 Notes [Member]
Debt Conversion, Converted Instrument, Shares Issued	1,338,707
Repayments of Convertible Debt	$ 11,668
Long-term Debt, Gross	58,100,000
Debt Conversion, Original Debt, Amount	1,000,000
Repayments of Remaining Convertible Debt Through Necessary Funds	$ 2,500,000
Debt Instrument, Interest Rate, Stated Percentage	7.50%

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Research and Development Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based compensation	$ (2)	$ 55	$ 40	$ 120
General and Administrative Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based compensation	$ 14	$ 43	$ 34	$ 96

INVENTORIES (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Raw materials	$ 3,280	$ 3,838
Work in progress	365	485
Finished goods	3,333	3,510
Total inventory	$ 6,978	$ 7,833

FAIR VALUE MEASUREMENT (The liability component was valued based on the Income Approach) (Details) - Seven Point Five Percentage Convertible Notes [Member] - Fair Value, Inputs, Level 3 [Member]	6 Months Ended
	Jun. 30, 2018 $ / shares
Stock price (USD)	$ 0.43
Expected term (years)	3 years 4 months 17 days
Risk free rate	2.63%
Volatility	71.89%
Yield	13.17%

FAIR VALUE MEASUREMENT (Narrative) (Details) $ in Millions	Jun. 30, 2018 USD ($)
7.50% Convertible Notes 2016 [Member]
Debt Instrument, Interest Rate, Stated Percentage	7.50%
Fair Value, Inputs, Level 3 [Member]
Convertible Debt, Fair Value Disclosures	$ 61.4
Fair Value, Inputs, Level 3 [Member] \| 7.50% Convertible Notes 2016 [Member]
Debt Instrument, Face Amount	$ 58.1

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (CAPITAL DEFICIENCY) [Parenthetical] - $ / shares	Jun. 30, 2018	Jun. 30, 2017
Common stock, par value per share	$ 0.001	$ 0.001
Common stock, shares authorized	250,000,000	250,000,000

SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Significant Accounting Policies [Line Items]
Contracts liability	$ 21,636	$ 25,015
Accumulated deficit		(296,096)
Previously Reported [Member]
Significant Accounting Policies [Line Items]
Contracts liability	31,885	26,851
Accumulated deficit		(297,932)
Restatement Adjustment [Member]
Significant Accounting Policies [Line Items]
Contracts liability	$ (10,249)	(1,836)
Accumulated deficit		$ 1,836

SUBSEQUENT EVENTS (Narrative) (Details) - USD ($) $ in Millions	1 Months Ended
	Jul. 23, 2018	Oct. 19, 2017
Maximum [Member]
Additional AmountPayable For Achievement Of Regulatory And Commercial Milestones		$ 320.0
Maximum [Member] \| Subsequent Event [Member]
Additional AmountPayable For Achievement Of Regulatory And Commercial Milestones	$ 760.0
Chiesi Agreement [Member]
Upfront Nonrefundable Noncreditable Payment Receivable		25.0
Additional Amounts Payable To Cover Development Costs		25.0
Maximum Entitlement Of Development Costs To Cover Per Year		$ 10.0
Chiesi Agreement [Member] \| Subsequent Event [Member]
Upfront Nonrefundable Noncreditable Payment Receivable	25.0
Additional Amounts Payable To Cover Development Costs	20.0
Maximum Entitlement Of Development Costs To Cover Per Year	$ 7.5
Chiesi Agreement [Member] \| Maximum [Member]
Payment On Net Sales Percentage		35.00%
Chiesi Agreement [Member] \| Maximum [Member] \| Subsequent Event [Member]
Payment On Net Sales Percentage	40.00%
Chiesi Agreement [Member] \| Minimum [Member]
Payment On Net Sales Percentage		15.00%
Chiesi Agreement [Member] \| Minimum [Member] \| Subsequent Event [Member]
Payment On Net Sales Percentage	15.00%