December 31, 2022 |
December 31, 2021 |
|||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | $ | ||||||
Marketable securities |
||||||||
Prepaid expenses and other current assets |
||||||||
Total current assets |
||||||||
Property and equipment, net |
||||||||
Operating lease right-of-use |
||||||||
Restricted cash |
||||||||
Other assets |
||||||||
Total assets |
$ | $ | ||||||
Liabilities and Stockholders’ Equity |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | $ | ||||||
Accrued expenses and other current liabilities |
||||||||
Operating lease liability |
||||||||
Total current liabilities |
||||||||
Operating lease liability, non-current |
||||||||
Convertible note payable, non-current |
||||||||
Total liabilities |
||||||||
Commitments and contingencies (Notes 13 and 16) |
||||||||
Stockholders’ equity: |
||||||||
Preferred stock, $ |
||||||||
Common stock, $ |
||||||||
Additional paid-in capital |
||||||||
Accumulated other comprehensive loss |
( |
) | ( |
) | ||||
Accumulated deficit |
( |
) | ( |
) | ||||
Total stockholders’ equity |
||||||||
Total liabilities and stockholders’ equity |
$ | $ | ||||||
Year Ended December 31, |
||||||||||||
2022 |
2021 |
2020 |
||||||||||
Collaboration revenue - related party |
$ | $ | $ | |||||||||
License-related revenue |
||||||||||||
Total revenue |
$ | $ | $ | |||||||||
Operating expenses: |
||||||||||||
Research and development |
||||||||||||
General and administrative |
||||||||||||
Total operating expenses |
||||||||||||
Income (loss) from operations |
( |
) | ( |
) | ||||||||
Interest expense |
( |
) | ( |
) | ( |
) | ||||||
Other income, net |
||||||||||||
Net income (loss) |
( |
) | ( |
) | ||||||||
Net income (loss) per share—basic |
$ | ( |
) | $ | ( |
) | $ | |||||
Weighted average common shares outstanding—basic |
||||||||||||
Net income (loss) per share—diluted |
$ | ( |
) | $ | ( |
) | $ | |||||
Weighted average common shares outstanding—diluted |
||||||||||||
Comprehensive income (loss): |
||||||||||||
Net income (loss) |
$ | ( |
) | $ | ( |
) | $ | |||||
Other comprehensive loss: |
||||||||||||
Unrealized loss on marketable securities, net of tax |
( |
) | ( |
) | ( |
) | ||||||
Comprehensive income (loss) |
$ | ( |
) | $ | ( |
) | $ | |||||
Common Stock |
Additional Paid-in Capital |
Accumulated Other Comprehensive Loss |
Accumulated Deficit |
Total Stockholders’ Equity |
||||||||||||||||||||
Shares |
Amount |
|||||||||||||||||||||||
Balances at December 31, 2019 |
( |
) | ||||||||||||||||||||||
Issuance of common stock upon exercise of stock options |
— | — | — | |||||||||||||||||||||
Issuance of common stock under stock purchase plan |
— | — | — | |||||||||||||||||||||
Issuance of common stock upon public offering, net of issuance costs |
— | — | ||||||||||||||||||||||
Issuance of common stock upon conversion of convertible note payable |
— | — | — | |||||||||||||||||||||
Stock-based compensation expense |
— | — | — | — | ||||||||||||||||||||
Unrealized loss on marketable securities |
— | — | — | ( |
) | — | ( |
) | ||||||||||||||||
Net income |
— | — | — | — | ||||||||||||||||||||
Balances at December 31, 2020 |
( |
) | ||||||||||||||||||||||
Issuance of common stock upon exercise of stock options |
— | — | — | |||||||||||||||||||||
Issuance of common stock upon vesting of RSUs |
— | — | — | — | — | |||||||||||||||||||
Issuance of common stock under stock purchase plan |
— | — | — | |||||||||||||||||||||
Issuance of common stock upon public offering, net of issuance costs |
— | — | ||||||||||||||||||||||
Issuance of common stock upon conversion of convertible note payable |
— | — | — | |||||||||||||||||||||
Stock-based compensation expense |
— | — | — | — | ||||||||||||||||||||
Unrealized loss on marketable securities |
— | — | — | ( |
) | — | ( |
) | ||||||||||||||||
Net loss |
— | — | — | — | ( |
) | ( |
) | ||||||||||||||||
Balances at December 31, 2021 |
( |
) | ( |
) | ||||||||||||||||||||
Issuance of common stock upon exercise of stock options |
— | — | — | |||||||||||||||||||||
Issuance of common stock upon vesting of RSUs |
— | — | — | — | — | |||||||||||||||||||
Issuance of common stock under stock purchase plan |
— | — | — | |||||||||||||||||||||
Issuance of common stock upon public offering, net of issuance costs |
— | — | ||||||||||||||||||||||
Stock-based compensation expense |
— | — | — | — | ||||||||||||||||||||
Unrealized loss on marketable securities |
— | — | — | ( |
) | — | ( |
) | ||||||||||||||||
Net loss |
— | — | — | — | ( |
) | ( |
) | ||||||||||||||||
Balances at December 31, 2022 |
$ | $ | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||
Year Ended December 31, |
||||||||||||
2022 |
2021 |
2020 |
||||||||||
Cash flows from operating activities: |
||||||||||||
Net income (loss) |
$ | ( |
) | $ | ( |
) | $ | |||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
||||||||||||
Depreciation and amortization expense |
||||||||||||
Stock-based compensation expense |
||||||||||||
Non-cash interest expense related to note payable |
||||||||||||
Net amortization of premiums and discounts on marketable securities |
( |
) | ||||||||||
Loss on disposal of property and equipment |
||||||||||||
Non-cash operating lease cost |
||||||||||||
Changes in operating assets and liabilities: |
||||||||||||
Prepaid expenses and other current assets |
( |
) | ( |
) | ||||||||
Unbilled receivable |
( |
) | ||||||||||
Other assets |
( |
) | ||||||||||
Accounts payable |
( |
) | ( |
) | ( |
) | ||||||
Accrued expenses and other current liabilities |
( |
) | ||||||||||
Operating lease liability |
( |
) | ( |
) | ( |
) | ||||||
Deferred revenue - related party |
( |
) | ||||||||||
Net cash provided by (used in) operating activities |
( |
) | ( |
) | ||||||||
Cash flows from investing activities: |
||||||||||||
Purchases of property and equipment |
( |
) | ( |
) | ( |
) | ||||||
Purchases of marketable securities |
( |
) | ( |
) | ( |
) | ||||||
Proceeds from sales or maturities of marketable securities |
||||||||||||
Net cash provided by (used in) investing activities |
( |
) | ||||||||||
Cash flows from financing activities: |
||||||||||||
Proceeds from issuance of convertible note payable, net of issuance costs |
||||||||||||
Proceeds for issuance of common stock, net |
||||||||||||
Proceeds from employee stock purchases |
||||||||||||
Proceeds from exercise of stock options |
||||||||||||
Net cash provided by financing activities |
||||||||||||
Net increase (decrease) in cash and cash equivalents and restricted cash |
( |
) | ( |
) | ||||||||
Cash and cash equivalents and restricted cash at beginning of period |
||||||||||||
Cash and cash equivalents and restricted cash at end of period |
$ | $ | $ | |||||||||
Supplemental disclosure of cash flow information: |
||||||||||||
Cash paid for interest |
$ | $ | $ | |||||||||
Supplemental disclosure of non-cash investing and financing activities: |
||||||||||||
Purchases of property and equipment included in accounts payable and accrued expenses |
$ | $ | $ | |||||||||
Additional right-of-use |
$ | $ | $ | |||||||||
Conversion of note payable into shares of common stock |
$ | $ | $ |
1. |
Nature of the Business |
2. |
Summary of Significant Accounting Policies |
• | Level 1—Quoted prices in active markets for identical assets or liabilities. |
• | Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data. |
• | Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. |
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 within the contract; and |
v. | recognize revenue when (or as) the entity satisfies a performance obligation. |
3. |
Marketable Securities |
December 31, 2022 |
||||||||||||||||
Amortized Cost |
Gross Unrealized Gains |
Gross Unrealized Losses |
Fair Value |
|||||||||||||
Marketable debt securities: |
||||||||||||||||
U.S. Treasury notes |
$ | $ | $ | ( |
) | $ | ||||||||||
U.S. government agency bonds |
( |
) | $ | |||||||||||||
Corporate bonds |
$ | $ | $ | ( |
) | $ | ||||||||||
$ | $ | $ | ( |
) | $ | |||||||||||
December 31, 2022 |
||||||||
Amortized Cost |
Fair Value |
|||||||
Maturing in one year or less |
$ | $ | ||||||
Maturing in more than one year |
$ | |||||||
$ | $ | |||||||
December 31, 2021 |
||||||||||||||||
Amortized Cost |
Gross Unrealized Gains |
Gross Unrealized Losses |
Fair Value |
|||||||||||||
Marketable debt securities: |
||||||||||||||||
U.S. Treasury notes |
$ | $ | $ | ( |
) | $ | ||||||||||
U.S. government agency bonds |
( |
) | $ | |||||||||||||
$ | $ | $ | ( |
) | $ | |||||||||||
December 31, 2021 |
||||||||
Amortized Cost |
Fair Value |
|||||||
Maturing in one year or less |
$ | $ | ||||||
Maturing in more than one year |
$ | |||||||
$ | $ | |||||||
4. |
Fair Value of Financial Assets |
Fair Value Measurements as of December 31, 2022 using: |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
Cash equivalents: |
||||||||||||||||
Money market funds |
$ | $ | $ | $ | ||||||||||||
Marketable securities: |
||||||||||||||||
U.S. Treasury notes |
||||||||||||||||
U.S. government agency bonds |
||||||||||||||||
Corporate bonds |
$ | $ | $ | |||||||||||||
$ | $ | $ | $ | |||||||||||||
Fair Value Measurements as of December 31, 2021 using: |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
Cash equivalents: |
||||||||||||||||
Money market funds |
$ | $ | $ | $ | ||||||||||||
Marketable securities: |
||||||||||||||||
U.S. Treasury notes |
||||||||||||||||
U.S. government agency bonds |
||||||||||||||||
$ | $ | $ | $ | |||||||||||||
5. |
Property and Equipment, Net |
Year Ended December 31, |
||||||||
2022 |
2021 |
|||||||
Laboratory equipment |
$ | $ | ||||||
Leasehold improvements |
||||||||
Computer equipment |
||||||||
Furniture and office equipment |
||||||||
Construction in process |
||||||||
Less: Accumulated depreciation and amortization |
( |
) | ( |
) | ||||
$ | $ | |||||||
6. |
Prepaid Expenses and Other Current Assets |
Year Ended December 31, |
||||||||
2022 |
2021 |
|||||||
Prepaid expenses |
$ | $ | ||||||
Unbilled receivable |
||||||||
Interest receivable on marketable securities |
||||||||
$ | $ | |||||||
7. |
Accrued Expenses and Other Current Liabilities |
Year Ended December 31, |
||||||||
2022 |
2021 |
|||||||
Accrued external research and development costs |
$ | $ | ||||||
Accrued payroll and payroll-related costs |
||||||||
Accrued professional fees |
||||||||
Other |
||||||||
$ | $ | |||||||
8. |
Collaboration and License Agreements |
Year Ended December 31, |
||||||||||||
2022 |
2021 |
2020 |
||||||||||
Collaboration revenue - related party |
$ | $ | $ |
Year Ended December 31, |
||||||||||||
2022 |
2021 |
2020 |
||||||||||
License-related revenue |
$ | $ | $ |
9. |
Stockholders’ Equity |
As of December 31, |
||||||||
2022 |
2021 |
|||||||
Options to purchase common stock - 2018 Plan |
||||||||
Shares available for future grant - 2018 Plan |
||||||||
Options to purchase common stock - Inducement Plan |
||||||||
Shares available for future grant - Inducement Plan |
||||||||
RSU’s issued and expecting to vest |
||||||||
2018 Employee Stock Purchase Plan |
||||||||
Shares available for conversion of note payable |
||||||||
Shares available for ATM offering |
||||||||
Total reserved |
||||||||
10. |
Stock-Based Awards |
Year Ended December 31, |
||||||||||||
2022 |
2021 |
2020 |
||||||||||
Risk-free interest rate |
% | % | % | |||||||||
Expected term (in years) |
||||||||||||
Expected volatility |
% | % | % | |||||||||
Expected dividend yield |
% | % | % |
Number of Shares |
Weighted Average Exercise Price |
Weighted Average Remaining Contractual Term |
Aggregate Intrinsic Value |
|||||||||||||
(in years) | ||||||||||||||||
Outstanding as of December 31, 2021 |
$ | $ | ||||||||||||||
Granted |
||||||||||||||||
Exercised |
( |
) | ||||||||||||||
Forfeited |
( |
) | ||||||||||||||
Outstanding as of December 31, 2022 |
$ | $ | ||||||||||||||
Options exercisable at December 31, 2022 |
$ | $ | ||||||||||||||
Vested and expected to vest at December 31, 2022 |
$ | $ | ||||||||||||||
Number of Shares |
Weighted Average Exercise Price |
Weighted Average Remaining Contractual Term |
Aggregate Intrinsic Value |
|||||||||||||
(in years) | ||||||||||||||||
Outstanding as of December 31, 2021 |
$ | $ | ||||||||||||||
Granted |
||||||||||||||||
Exercised |
||||||||||||||||
Forfeited |
( |
) | ||||||||||||||
Outstanding as of December 31, 2022 |
$ | $ | ||||||||||||||
Options exercisable at December 31, 2022 |
$ | $ | ||||||||||||||
Vested and expected to vest at December 31, 2022 |
$ | $ | ||||||||||||||
Number of Shares |
Weighted Average Grant-Date Fair Value |
|||||||
Unvested restricted stock units as of December 31, 2021 |
$ | |||||||
Granted |
||||||||
Vested |
( |
) | ||||||
Forfeited |
( |
) | ||||||
Unvested restricted stock units as of December 31, 2022 |
$ | |||||||
Year Ended December 31, |
||||||||||||
2022 |
2021 |
2020 |
||||||||||
Research and development expenses |
$ | $ | $ | |||||||||
General and administrative expenses |
||||||||||||
$ | $ | $ | ||||||||||
11. |
Debt |
December 31, 2022 |
||||
2023 |
$ | |||
2024 |
||||
2025 |
||||
Total principal payments |
||||
Final fee due in 2023 |
||||
Final fee due at maturity in 2025 |
||||
Total principal payments and final fee |
||||
Unamortized debt discount and final fee |
||||
Note payable |
$ | |||
12. |
Net Income (Loss) per Share |
Year Ended December 31, |
||||||||||||
2022 |
2021 |
2020 |
||||||||||
Basic net income (loss) per share: |
||||||||||||
Numerator: |
||||||||||||
Net income (loss) |
$ | ( |
) | $ | ( |
) | $ | |||||
Denominator: |
||||||||||||
Weighted average commons shares outstanding—basic |
||||||||||||
Net income (loss) per share—basic |
$ | ( |
) | $ | ( |
) | $ | |||||
Diluted net income (loss) per share: |
||||||||||||
Numerator: |
||||||||||||
Net income (loss)—basic |
$ | ( |
) | $ | ( |
) | $ | |||||
Interest expense on convertible note payable |
||||||||||||
Net income (loss)—diluted |
$ | ( |
) | $ | ( |
) | $ | |||||
Denominator: |
||||||||||||
Weighted average commons shares outstanding—basic |
||||||||||||
Shares issuable upon conversion of convertible notes, as if converted |
||||||||||||
Dilutive effect of restricted stock units |
||||||||||||
Dilutive effect of common stock equivalents |
||||||||||||
Weighted average commons shares outstanding—diluted |
||||||||||||
Net income (loss) per share—diluted |
$ | ( |
) | $ | ( |
) | $ | |||||
Year Ended December 31, |
||||||||
2022 |
2021 |
|||||||
Stock Options to purchase common stock - 2018 Plan |
||||||||
Stock Options to purchase common stock - Inducement Plan |
||||||||
Shares to be issued under the ESPP |
||||||||
RSUs issued and expected to vest |
||||||||
Shares available from conversion of note payable |
13. |
License Agreements |
14. |
Income Taxes |
Year Ended December 31, |
||||||||||||
2022 |
2021 |
2020 |
||||||||||
Income (loss) before taxes: |
||||||||||||
Domestic |
$ | ( |
) | $ | ( |
) | $ | |||||
Foreign |
||||||||||||
Total income (loss) before income taxes |
$ | ( |
) | $ | ( |
) | $ | |||||
Year Ended December 31, |
||||||||||||
2022 |
2021 |
2020 |
||||||||||
Federal statutory income tax rate |
( |
)% | ( |
)% | % | |||||||
State taxes, net of federal benefit |
( |
)% | ( |
)% | % | |||||||
Stock-based compensation |
% | % | % | |||||||||
Research and development tax credits |
( |
)% | ( |
)% | ( |
)% | ||||||
Change in deferred tax asset valuation allowance |
% | % | ( |
)% | ||||||||
Other |
% | % | ( |
)% | ||||||||
Effective income tax rate |
% | % | % | |||||||||
December 31, |
||||||||
2022 |
2021 |
|||||||
Deferred tax assets: |
||||||||
Net operating loss carryforwards |
$ | $ | ||||||
Research and development tax credit carryforwards |
||||||||
Intangible assets |
||||||||
Accrued expenses |
||||||||
Stock-based compensation |
||||||||
Lease liability |
||||||||
Interest expense |
||||||||
Capitalized R&D expenditures |
||||||||
Other |
||||||||
Total deferred tax assets |
||||||||
Valuation allowance |
( |
) | ( |
) | ||||
Deferred tax assets |
||||||||
Deferred tax liabilities: |
||||||||
Right-of-use |
( |
) | ( |
) | ||||
Depreciation |
( |
) | ( |
) | ||||
Beneficial conversion feature on convertible note payable |
( |
) | ( |
) | ||||
Other |
( |
) | ||||||
Total deferred tax liabilities |
( |
) | ( |
) | ||||
Net deferred tax assets |
$ | $ | ||||||
Year Ended December 31, |
||||||||||||
2022 |
2021 |
2020 |
||||||||||
Valuation allowance at beginning of year |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Increases recorded to income tax provision |
( |
) | ( |
) | ( |
) | ||||||
Decreases recorded as a benefit to income tax provision |
||||||||||||
Valuation allowance at end of year |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
15. |
Leases |
Lease Costs |
Classification |
Year Ended December 31, 2022 |
Year Ended December 31, 2021 |
Year Ended December 31, 2020 |
||||||||||||
Operating lease cost |
R&D Expense | $ | $ | $ | ||||||||||||
G&A Expense | ||||||||||||||||
Variable lease costs (1) |
R&D Expense | |||||||||||||||
G&A Expense | ||||||||||||||||
Total lease cost |
$ | $ | $ | |||||||||||||
Weighted-average remaining lease term (in months) |
||||||||||||||||
Weighted-average discount rate |
% | % | % |
(1) | Variable lease costs include certain additional charges for operating costs, including insurance, maintenance, taxes, utilities, and other costs incurred, which are billed based on both usage and as a percentage of the Company’s share of total square footage. Short term lease costs are immaterial. |
Year Ending December 31, |
||||
2023 |
$ | |||
2024 |
||||
2025 |
||||
2026 |
||||
2027 |
||||
Thereafter |
||||
Total future lease payments |
||||
Less: Interest |
( |
) | ||
Present value of future lease payments (lease liability) |
$ | |||
Year Ending December 31, |
||||
2022 |
$ | |||
2023 |
||||
2024 |
||||
2025 |
||||
2026 |
||||
Thereafter |
||||
$ | ||||
Year Ending December 31, |
||||
2023 |
$ | |||
2024 |
||||
$ | ||||
16. |
Commitments and Contingencies |
17. |
401(k) Savings Plan |
18. |
Events Subsequent to Original Issuance of Consolidated Financial Statements (Unaudited) |
• | a number of shares of common stock, par value $ Parent Common Stock ”) equal to the exchange ratio (the “Exchange Ratio ”) determined by dividing (x) the quotient obtained by dividing (1) $Closing ”), as calculated in accordance with the Merger Agreement, by (2) $Parent Stock Price ”), by (y) the total number of shares of Company Common Stock outstanding immediately prior to the Effective Time, on a fully-diluted and as-converted basis as determined in accordance with the Merger Agreement (the “Upfront Consideration ”), plus any cash payable in lieu of a fractional share of Parent Common Stock; and |
• | one contingent value right (a “ CVR ”) representing the right to receive the CVR Payment Amount (as defined below), as provided for in the CVR Agreement (as defined below) (collectively, with the Upfront Consideration, the “Merger Consideration ”). |
• | each Company Stock Option with an exercise price per share that is less than the value of the Upfront Consideration (an “ In-the-Money Option ”) shall be cancelled and converted into the right to receive: |
a) | a number of shares of Parent Common Stock, subject to certain exceptions for fractional shares and applicable withholdings, equal to the quotient of (x) the product of (1) the total number of shares of vested and unvested Company Common Stock underlying the In-the-Money In-the-Money |
b) | a number of CVRs equal to the vested and unvested shares of Company Common Stock underlying the In-the-Money |
• | each Company Stock Option held by a Company employee who continues employment with Parent and its affiliates after the Effective Time (a “ Covered Employee ”) and with an exercise price that is equal to or greater than the value of the Upfront Consideration (each, an “Underwater Option ”) shall be assumed by Parent and converted into an option to acquire shares of Parent Common Stock (an “Assumed Option ”), and with the same vesting schedule and other terms and conditions applicable to such Assumed Option immediately prior to the Effective Time, except that (i) each Assumed Option shall become exercisable for a number of shares of Parent Common Stock equal to the product (rounded down to the next whole number of shares) of (x) the number of shares of Company Common Stock that would have been issuable upon full exercise of such Assumed Option immediately prior to the Effective Time multiplied by (y) the Exchange Ratio, and (ii) the per share exercise price for such Assumed Option shall equal the quotient (rounded up to the next whole cent) obtained by dividing the exercise price per share of the Company Common Stock as of immediately prior to the Effective Time by the Exchange Ratio; and |
• | each Underwater Option held by a Company employee who is not a Covered Employee shall be cancelled, and the holder of such Underwater Option shall receive no Merger Consideration with respect to such Underwater Option. |
• |
• |
• |
• |