2017, we have an accumulated deficit of $53.5 million. We believe that our cash and cash equivalents of $25.8 million as of December 31, 2017 is sufficient to fund the Company for the next twelve months as of the date of this report. See “—Funding Requirements” below for additional information on our future capital needs.
The following table shows a summary of our cash flows for the years ended December 31, 2017 and 2016:
Net cash used in operating activities
Net cash used in investing activities
Net cash provided by financing activities
Net increase in cash and cash equivalents
Net cash used in operating activities was $19.8 million and $5.1 million for the years ended December 31, 2017 and 2016, respectively. The increase in cash used in operating activities of $14.7 million was primarily due to the cash impact of higher research and development expenses in the year ended December 31, 2017, the payment for legal and accounting services of approximately $1.5 million, which were incurred in support of a potential public offering that was abandoned during the second quarter of 2017 and also in support of registering the resale of 39,714,143 shares of our common stock issued in connection with the Merger and the Private Placement, the payment of $1.5 million in connection with the Northwestern University license agreements, as well as the prepayment of directors and officers liability insurance, partially offset by the receipt of the $10.0 million upfront payment in connection with the Purdue Collaboration in December 2016.
Net cash used in investing activities was $0.9 million and $0.4 million for the years ended December 31, 2017 and 2016, respectively. Cash used in investing activities for each of the above-mentioned periods was primarily due to the purchase of scientific equipment.
Net cash provided by financing activities of $26.9 million during the year ended December 31, 2017 is primarily due to the sale of common stock in the Private Placement. Gross proceeds from the Private Placement of $31.5 million, less financing costs paid in 2017 of $3.7 million, were partially offset by the repayment of debt of $1.0 million. Net cash provided by financing activities of $6.3 million during the year ended December 31, 2016 is mostly due to net proceeds of $5.9 million from our February 2016 secured debt financing with Hercules and $0.4 million from our January 2016 Series C preferred stock offering.
Hercules Loan and Security Agreement
On February 17, 2016, we entered into a loan and security agreement with Hercules. The loan agreement provided for funding in an aggregate principal amount of up to $10.0 million in two separate tranches. The first tranche was funded on February 17, 2016 in the amount of $6.0 million. A second tranche of $4.0 million was available provided that we met certain milestones on or before December 31, 2016. We did not meet these milestones and, therefore, we did not draw the second tranche, the availability of which expired on December 31, 2016. The principal balance of the term loan under the Hercules loan facility bears interest at a floating per annum