Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 21, 2024 | Jun. 30, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Transition Report | false | ||
Entity File Number | 000-30111 | ||
Entity Registrant Name | Lexicon Pharmaceuticals, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 76-0474169 | ||
Entity Address, Address Line One | 2445 Technology Forest Blvd., 11th Floor | ||
Entity Address, City or Town | The Woodlands, | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 77381 | ||
City Area Code | (281) | ||
Local Phone Number | 863-3000 | ||
Title of 12(b) Security | Common Stock, par value $0.001 per share | ||
Trading Symbol | LXRX | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 273.7 | ||
Entity Common Stock, Shares Outstanding | 246,236,753 | ||
Documents Incorporated by Reference | Certain sections of the registrant’s definitive proxy statement relating to the registrant’s 2024 annual meeting of stockholders, which proxy statement will be filed under the Securities Exchange Act of 1934 within 120 days of the end of the registrant’s fiscal year ended December 31, 2023, are incorporated by reference into Part III of this annual report on Form 10-K. | ||
Entity Central Index Key | 0001062822 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Audit Information [Abstract] | |
Auditor Firm ID | 42 |
Auditor Name | Ernst & Young LLP |
Auditor Location | Houston, Texas |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 22,465 | $ 46,345 |
Short-term investments | 147,561 | 92,012 |
Accounts receivable, net | 1,010 | 28 |
Inventory | 381 | 0 |
Prepaid expenses and other current assets | 5,130 | 2,481 |
Total current assets | 176,547 | 140,866 |
Property and equipment, net of accumulated depreciation and amortization of $4,538 and $3,984, respectively | 1,987 | 2,071 |
Goodwill | 44,543 | 44,543 |
Operating lease right-of-use-assets | 5,524 | 6,407 |
Other assets | 828 | 412 |
Total assets | 229,429 | 194,299 |
Current liabilities: | ||
Accounts payable | 14,389 | 10,395 |
Accrued liabilities | 17,157 | 12,777 |
Total current liabilities | 31,546 | 23,172 |
Long-term debt, net | 99,508 | 48,579 |
Long-term operating lease liabilities | 5,265 | 5,424 |
Total liabilities | 136,319 | 77,175 |
Commitments and contingencies (Note 10) | ||
Stockholders' Equity: | ||
Preferred stock, $0.01 par value; 5,000,000 shares authorized; no shares issued and outstanding | $ 0 | $ 0 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, $0.001 par value; 300,000,000 shares authorized; 245,792,668 and 189,213,948 shares issued, respectively | $ 245 | $ 189 |
Additional paid-in capital | 1,862,558 | 1,709,144 |
Accumulated deficit | (1,766,839) | (1,589,720) |
Accumulated other comprehensive income (loss) | 31 | (428) |
Treasury stock, at cost, 867,973 and 488,205 shares, respectively | (2,885) | (2,061) |
Total stockholders' equity | 93,110 | 117,124 |
Total liabilities and stockholders’ equity | $ 229,429 | $ 194,299 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Accumulated depreciation and amortization, property and equipment | $ 4,538 | $ 3,984 |
Preferred stock, par value per share (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000,000 | 5,000,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value per share (usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, issued (in shares) | 245,792,668 | 189,213,948 |
Treasury stock, at cost (in shares) | 867,973 | 488,205 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenues: | |||
Net product revenue | $ 1,110 | $ 0 | $ 0 |
Royalties and other revenue | 94 | 139 | 298 |
Total revenues | 1,204 | 139 | 298 |
Operating expenses: | |||
Cost of sales | 85 | 0 | 0 |
Research and development, including stock-based compensation of $5,139, $4,253 and $4,284 respectively | 58,887 | 52,816 | 55,046 |
Selling, general and administrative, including stock-based compensation of $9,201, $7,267 and $6,293, respectively | 113,982 | 48,083 | 32,342 |
Total operating expenses | 172,954 | 100,899 | 87,388 |
Loss from operations | (171,750) | (100,760) | (87,090) |
Other Expenses | (13,101) | (2,780) | (802) |
Interest income and other, net | 7,732 | 1,596 | 134 |
Net loss | $ (177,119) | $ (101,944) | $ (87,758) |
Net loss per common share, basic (usd per share) | $ (0.80) | $ (0.62) | $ (0.60) |
Net loss per common share, diluted (usd per share) | $ (0.80) | $ (0.62) | $ (0.60) |
Shares used in computing net loss per common share, basic | 221,130 | 165,733 | 145,652 |
Shares used in computing net loss per common share, diluted | 221,130 | 165,733 | 145,652 |
Other comprehensive loss: | |||
Unrealized gain (loss) on investments | $ 459 | $ (418) | $ (4) |
Comprehensive loss | $ (176,660) | $ (102,362) | $ (87,762) |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Loss (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Stock-based compensation | $ 14,300 | $ 11,500 | $ 10,600 |
Other Expenses | (13,101) | (2,780) | (802) |
Research and Development Expense | |||
Stock-based compensation | 5,139 | 4,253 | 4,284 |
Selling, General and Administrative Expenses | |||
Stock-based compensation | $ 9,201 | $ 7,267 | $ 6,293 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Gain (Loss) | Treasury Stock |
Beginning balance (in shares) at Dec. 31, 2020 | 142,289,000 | |||||
Beginning balance at Dec. 31, 2020 | $ 156,371 | $ 142 | $ 1,561,096 | $ (1,400,018) | $ (6) | $ (4,843) |
Stock-based compensation | 10,577 | 10,577 | ||||
Issuance of common stock, net of fees (in shares) | 6,177,000 | |||||
Issuance of common stock, net of fees | 35,491 | $ 6 | 35,485 | |||
Issuance of equity-classified warrants | 0 | |||||
Issuance of common stock under Equity Incentive Plans (in shares) | 1,616,000 | |||||
Issuance of common stock under Equity Incentive Plans | 1,593 | $ 2 | 1,591 | |||
Repurchase of common stock | (2,675) | (2,675) | ||||
Net loss | (87,758) | (87,758) | ||||
Unrealized gain (loss) on investments | (4) | (4) | ||||
Ending balance (in shares) at Dec. 31, 2021 | 150,082,000 | |||||
Ending balance at Dec. 31, 2021 | 113,595 | $ 150 | 1,608,749 | (1,487,776) | (10) | (7,518) |
Stock-based compensation | 11,520 | 11,520 | ||||
Issuance of common stock, net of fees (in shares) | 39,100,000 | |||||
Issuance of common stock, net of fees | 94,205 | $ 39 | 94,166 | |||
Issuance of equity-classified warrants | 1,030 | 1,030 | ||||
Issuance of treasury stock | 0 | (6,321) | 6,321 | |||
Issuance of common stock under Equity Incentive Plans (in shares) | 32,000 | |||||
Repurchase of common stock | (864) | (864) | ||||
Net loss | (101,944) | (101,944) | ||||
Unrealized gain (loss) on investments | $ (418) | (418) | ||||
Ending balance (in shares) at Dec. 31, 2022 | 189,213,948 | 189,214,000 | ||||
Ending balance at Dec. 31, 2022 | $ 117,124 | $ 189 | 1,709,144 | (1,589,720) | (428) | (2,061) |
Stock-based compensation | 14,340 | 14,340 | ||||
Issuance of common stock, net of fees (in shares) | 55,288,000 | |||||
Issuance of common stock, net of fees | 138,823 | $ 55 | 138,768 | |||
Issuance of equity-classified warrants | 307 | 307 | ||||
Issuance of common stock under Equity Incentive Plans (in shares) | 1,291,000 | |||||
Issuance of common stock under Equity Incentive Plans | 0 | $ 1 | (1) | |||
Repurchase of common stock | (824) | (824) | ||||
Net loss | (177,119) | (177,119) | ||||
Unrealized gain (loss) on investments | $ 459 | 459 | ||||
Ending balance (in shares) at Dec. 31, 2023 | 245,792,668 | 245,793,000 | ||||
Ending balance at Dec. 31, 2023 | $ 93,110 | $ 245 | $ 1,862,558 | $ (1,766,839) | $ 31 | $ (2,885) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities: | |||
Net loss | $ (177,119) | $ (101,944) | $ (87,758) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 554 | 427 | 292 |
Stock-based compensation | 14,340 | 11,520 | 10,577 |
Amortization of debt-related costs | 1,774 | 741 | 54 |
Loss on disposal of property and equipment | 0 | 3 | 49 |
Other non-cash adjustments | (4,105) | 0 | 0 |
Changes in operating assets and liabilities: | |||
(Increase) decrease in accounts receivable | (982) | (14) | 381 |
Increase in inventories | (381) | 0 | 0 |
(Increase) decrease in prepaid expenses and other current assets | (2,899) | (316) | 2,885 |
Decrease in other long-term assets | 467 | 656 | 661 |
Increase (decrease) in accounts payable and other liabilities | 6,454 | 76 | (14,158) |
Net cash used in operating activities | (161,897) | (88,851) | (87,017) |
Cash flows from investing activities: | |||
Purchases of property and equipment | (470) | (1,326) | (1,221) |
Purchases of investments | (223,343) | (133,949) | (34,261) |
Maturities of investments | 173,870 | 64,197 | 37,592 |
Net cash (used in) provided by investing activities | (49,943) | (71,078) | 2,110 |
Cash flows from financing activities: | |||
Proceeds from issuance of common stock, net of fees | 138,823 | 94,205 | 37,084 |
Repurchase of common stock | (824) | (864) | (2,675) |
Proceeds (repayment) of debt borrowings, net of fees | 49,961 | 48,868 | (11,700) |
Net cash provided by financing activities | 187,960 | 142,209 | 22,709 |
Net decrease in cash and cash equivalents | (23,880) | (17,720) | (62,198) |
Cash and cash equivalents at beginning of year | 46,345 | 64,065 | 126,263 |
Cash and cash equivalents at end of year | 22,465 | 46,345 | 64,065 |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | 10,057 | 2,289 | 799 |
Supplemental disclosure of noncash investing and financing activities: | |||
Right-of-use assets obtained in exchange for operating lease liability | 0 | 5,206 | 1,704 |
Issuance of equity-classified warrants | 307 | 1,030 | 0 |
Issuance of treasury stock | 0 | 6,321 | 0 |
Accrual of deferred financing costs | $ 250 | $ 0 | $ 0 |
Organization and Operations
Organization and Operations | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Operations | Organization and Operations Lexicon Pharmaceuticals, Inc. (“Lexicon” or the “Company”) is a Delaware corporation incorporated on July 7, 1995. Lexicon was organized to discover the functions and pharmaceutical utility of genes and use those gene function discoveries in the discovery and development of pharmaceutical products for the treatment of human disease. Lexicon has financed its operations from inception primarily through sales of common and preferred stock, contract and milestone payments to it under strategic collaborations and other research and development collaborations, target validation, database subscription and technology license agreements, product sales, government grants and contracts and financing under debt and lease arrangements. The Company’s future success is dependent upon many factors, including, but not limited to, the success of its commercialization efforts for INPEFA for heart failure; the success of its commercial launch of sotagliflozin for patients with type 1 diabetes and CKD, if approved; its ongoing research and development efforts and its ability to obtain necessary regulatory approvals of the drug candidates which are the subject of such efforts; its success in establishing new collaborations and licenses and its receipt of milestones, royalties and other payments under such arrangements; the amount and timing of research, development and commercialization expenditures; the resources devoted to developing and supporting its products; general and industry-specific economic conditions which may affect research, development and commercialization expenditures; and its ability to obtain and enforce patents and other proprietary rights in its discoveries, comply with federal and state regulations, and maintain sufficient capital to fund its activities. As a result of the aforementioned factors and the related uncertainties, there can be no assurance of the Company’s future success. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation. The accompanying consolidated financial statements include the accounts of Lexicon and its wholly-owned subsidiaries. Intercompany transactions and balances are eliminated in consolidation. Lexicon has made certain reclassification adjustments to conform prior-period amounts to the current presentation. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Use of Estimates. The preparation of financial statements in conformity with U. S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. Cash, Cash Equivalents and Short-Term Investments. Lexicon considers all highly-liquid investments with original maturities of three months or less to be cash equivalents. As of December 31, 2023 and 2022, short-term investments consist primarily of U.S. treasury bills as well as certain corporate and other debt securities. The Company’s short-term investments are available for use in current operations regardless of the stated maturity date of the security. These short-term investments are classified as available-for-sale securities as the Company has not historically or does not intend to sell any of its available-for-sale securities prior to their maturity dates. Short-term investments are carried at fair value, based on quoted market prices of the securities. The costs of securities sold is based on the specific identification method. Any net realized gains and losses, interest and dividends, and amortization of premium or accretion of discount are included in interest and other income. Unrealized gains and losses on such securities are reported as a separate component of stockholders’ equity. The Company reviews its portfolio of available-for-sale debt securities in an unrealized loss position. For those investments whose fair value is less than amortized cost, to the extent the Company decided to sell these investments prior to their maturity dates or was required to sell such investments, the Company would evaluate the expected cash flows to be received as compared to amortized cost and to determine if an expected credit loss has occurred. Accounts Receivable. Lexicon records trade accounts receivable in the normal course of business related to the sale of products or services, net of an allowance for expected credit losses. Concentration of Credit Risk. Lexicon’s cash equivalents, investments and accounts receivable represent potential concentrations of credit risk. The Company attempts to minimize potential concentrations of risk in cash equivalents and investments by placing investments in high-quality financial instruments. The Company has not experienced any realized losses on its cash equivalents or short-term investments. The Company’s accounts receivable are unsecured and are primarily concentrated in large pharmaceutical and biotechnology companies located in the United States. The Company has not experienced any significant credit losses to date. Segment Information and Significant Customers. Lexicon operates in one business segment, which primarily focuses on the discovery, development and commercialization of pharmaceutical products for the treatment of human disease. Substantially all of the Company’s revenues have been derived from drug discovery alliances, target validation collaborations for the development and, in some cases, analysis of the physiological effects of genes altered in knockout mice, technology licenses, subscriptions to its databases, product sales, government grants and contracts and compound library sales, as well as from commercial sales of its approved drug products. In support of the commercial launch of INPEFA in 2023, the Company entered into distribution agreements with wholesalers and limited retail pharmacies. The Company’s net product sales are generated from sales to these customers. In 2023, 11 United States-based customers accounted for all of the Company’s net product revenue. Three large wholesalers, each of which account for greater than 10% of total revenues and in the aggregate account for greater than 85% of total revenues. In 2022 and 2021, the Company’s revenues were solely derived from royalties and other revenues from one and two customers, respectively. Property and Equipment. Property and equipment that is held and used is carried at cost and depreciated using the straight-line method over the estimated useful life of the assets, which ranges from three Impairment of Long-Lived Assets. Long-lived assets and right-of-use assets for leases are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of assets to be held and used is measured by comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount that the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. There were no impairments of long-lived assets, in 2023, 2022, or 2021. Goodwill. Goodwill is not amortized, but is tested at least annually for impairment at the reporting unit level which the Company has determined is the single operating segment disclosed in its current financial statements. An impairment exists when the carrying amount of goodwill exceeds its implied fair value. Additional impairment assessments may be performed on an interim basis if the Company encounters events or changes in circumstances that would indicate that, more likely than not, the carrying value of goodwill has been impaired. Leases. Lexicon determines if a contract is or contains a lease at inception or upon modification of the contract. A contract is or contains a lease if it conveys the right to control the use of an identified asset for a period in exchange for consideration. Control over the use of the identified asset means the lessee has both (a) the right to obtain substantially all of the economic benefits from the use of the asset and (b) the right to direct the use of the asset. Lexicon does not apply this accounting to those leases with terms of twelve (12) months or less. Operating lease right-of-use assets and associated lease liabilities are recorded in the balance sheet at the lease commencement date based on the present value of future lease payments to be made over the expected lease term. As the implicit rate is not determinable in its leases, Lexicon uses its incremental borrowing rate based on the information available at the commencement date to determine the present value of lease payments. Inventory: Inventory is comprised of INPEFA, the Company’s approved product that it is commercializing in the United States. Inventories are determined at the lower of cost or market value, with cost determined under the specific identification method. Revenue Recognition. The Company performs the following five steps in determining the amount of revenue to recognize as it fulfills its performance obligations under each of its collaborative agreements: (a) identify the contract(s) with a customer; (b) identify the performance obligation in the contract; (c) determine the transaction price; (d) allocate the transaction price to the performance obligation in the contract, and (e) recognize revenue when (or as) the Company satisfies the performance obligation. The Company applies this five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, 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 that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. The Company develops assumptions that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. Product Revenues Product revenues consist of U.S. sales of INPEFA, which Lexicon began shipping to its customers in the U.S. in June 2023. These customers primarily include wholesalers and limited retail pharmacies. The Company is continuing to contract with certain managed care programs or pharmacy benefit managers (“PBMs”) and has legislatively mandated contracts with the federal and state governments under which rebates are provided based on product utilization. Product revenues are recognized when control is transferred to the customer upon delivery. The Company recognizes product revenue net of applicable estimates of reserves for variable consideration using the expected value method. These estimates consider relevant factors such as current contractual and statutory requirements, industry data and forecasted customer buying and payment patterns. Net product revenue includes variable consideration only to the extent that it is probable that a significant reversal in revenue recognized will not occur in a future period. As necessary, these estimates will be adjusted in the period that such variances to actuals become known. Listed below is a further discussion of these reserves and sales return allowances: Customer Credits. The Company’s customers were offered various forms of consideration, including allowances, service fees and prompt payment discounts. The Company records allowances, deducts the full amount of prompt payment discounts, and deducts service fees from total product sales when revenues are earned and recognized. Rebates. Allowances for rebates include mandated discounts under the Medicaid Drug Rebate Program reflecting amounts owed after final dispensing of the product to participants. The Company’s estimates for rebates is based on statutory discount rates, third party market research data and data from sales to its customers. As rebates are generally invoiced and paid in arrears, the Company accrues an estimate of rebates based on the current quarter’s activity, plus any known unpaid prior quarter rebates. Chargebacks. Chargebacks are discounts that occur when contracted healthcare providers purchase directly from a wholesaler. Generally, the contracted healthcare providers purchase INPEFA at a discounted price. The wholesaler, in turn, charges back to Lexicon the difference between the price paid by the wholesaler and the discounted price that the wholesaler’s customer pays for that product. Medicare Part D Coverage Gap. The Medicare Part D prescription drug benefit mandates manufacturers to fund a portion of the Medicare Part D insurance coverage gap for prescription drugs sold to eligible patients. The Company’s estimates for the expected Medicare Part D coverage gap are based on sales data received from a third party and projections based on historical data. As funding of the coverage gap is generally invoiced and paid in arrears, the Company accrues an estimate based on the current quarter’s activity, plus any known unpaid prior quarter estimates. Co-payment assistance. Patients with commercial insurance who meet certain eligibility requirements are eligible to receive co-payment assistance. The Company accrues a liability for co-payment assistance based on actual program participation and estimates of program redemption using data provided by third-party administrators. Sales returns. The Company records allowances for product returns, if appropriate, as a reduction of revenue at the time product sales are recorded based on an assessment of market exclusivity of the product, the patient population, the customers’ return rights and the Company’s historical experience with returns. Because approval is recent and there is a limited number of patients, most customers and retailers carry a limited inventory. Collaborative Agreements Revenues under collaborative agreements include both license revenue and contract research revenue. At contract inception, the Company evaluates whether development milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal will not occur, the associated development milestone value is included in the transaction price. Development milestones that are not within the control of the Company or the licensee, including those requiring regulatory approval, are not considered probable of being achieved until those approvals are received. The transaction price is allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue when (or as) the performance obligation is satisfied. At the end of each reporting period, the Company re-evaluates the probability of achievement of the development milestones and any related constraint, and if necessary, adjusts its estimates of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect collaboration revenues in the period of adjustment. For agreements in which a license to the Company’s intellectual property is determined distinct from other performance obligations identified in the agreement, the Company recognizes revenue when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For agreements that include sales-based royalties, including milestones based on a level of sales, the license is deemed to be the predominant item to which the royalties relate and the Company recognizes revenue at the later of (a) when the related sales occur, or (b) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). The Company may receive payments from its licensees based on billing schedules established in each contract. Upfront payments and fees are recorded as deferred revenue upon receipt or when due, and may require deferral of revenue recognition to a future period until the Company performs its obligations under these agreements. Amounts are recorded as accounts receivable when the Company’s right to consideration is unconditional. Cost of Sales. Cost of sales consists of third-party manufacturing costs, product shipping and handling costs and freight associated with sales of INPEFA. The Company began capitalizing inventory manufactured subsequent to regulatory approval of INPEFA in June 2023, as the related costs were expected to be recovered through the commercialization of the product. Costs related to manufacturing inventory prior to the approval of INPEFA have been recorded as research and development expense in the consolidated statements of comprehensive loss. Research and Development Expenses. Research and development expenses consist of costs incurred for company-sponsored as well as collaborative research and development activities. These costs include direct and research-related overhead expenses and are expensed as incurred. Technology license fees for technologies that are utilized in research and development and have no alternative future use are expensed when incurred. Substantial portions of the Company’s preclinical and clinical trials are performed by third-party laboratories, medical centers, contract research organizations and other vendors. For preclinical studies, the Company accrues expenses based upon estimated percentage of work completed and the contract milestones remaining. For clinical studies, expenses are accrued based upon the number of patients enrolled and the completion of milestones. The Company monitors patient enrollment, the progress of clinical studies and related activities to the extent possible through internal reviews of data reported to the Company by the vendors and clinical site visits. The Company’s estimates depend on the timeliness and accuracy of the data provided by the vendors regarding the status of each program and total program spending. The Company periodically evaluates the estimates to determine if adjustments are necessary or appropriate based on information it receives. Stock-Based Compensation. Compensation expense related to stock options and restricted stock units (“RSUs”) is determined based on the fair value of the award on the date of the grant and is recognized on a straight-line basis over the vesting period in which an employee is required to provide service. Forfeitures of share-based payment awards are recognized in the period in which they occur. Compensation expense is recorded in research and development expense and selling, general, and administrative expense as noted on the Company’s consolidated statements of comprehensive loss. Income Taxes. The Company recognizes deferred tax liabilities and assets for the expected future tax consequences of events that have been recognized differently in the financial statements and tax returns. The Company uses the liability method in accounting for income taxes. Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement carrying amounts and tax bases of liabilities and assets using enacted tax rates and laws in effect in the years in which the differences are expected to reverse. Deferred tax assets are evaluated for realization based on a more-likely-than-not criteria in determining if a valuation allowance should be provided. In evaluating our valuation allowances, we consider cumulative book losses, the reversal of existing temporary differences, tax planning strategies and estimates of future taxable income, the latter two of which involve the exercise of significant judgment. Net Loss per Common Share. Net loss per common share is computed using the weighted average number of shares of common stock outstanding. Shares associated with warrants, stock options and restricted stock units that could potentially dilute earnings per share in the future are not included in the computation of diluted earnings per share because they are antidilutive. Recent Accounting Pronouncements Issued But Not Yet Adopted. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures , which is effective retrospectively for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures , which is effective prospectively for annual periods beginning after December 15, 2024. Early adoption is permitted for both standards. We do not expect these accounting pronouncements to have a material impact on our financial statements. |
Cash, Cash Equivalents and Inve
Cash, Cash Equivalents and Investments | 12 Months Ended |
Dec. 31, 2023 | |
Cash, Cash Equivalents, and Short-Term Investments [Abstract] | |
Cash, Cash Equivalents and Investments | Cash, Cash Equivalents and Investments The fair value of cash and cash equivalents and investments held at December 31, 2023 and 2022 are as follows: As of December 31, 2023 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Cash and cash equivalents $ 22,465 $ — $ — $ 22,465 Securities maturing within one year: U.S. treasury securities 141,577 31 (12) 141,596 Corporate debt securities 5,954 11 — 5,965 Total short-term investments $ 147,531 $ 42 $ (12) $ 147,561 Total cash and cash equivalents and investments $ 169,996 $ 42 $ (12) $ 170,026 As of December 31, 2022 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Cash and cash equivalents $ 46,345 $ — $ — $ 46,345 Securities maturing within one year: U.S. treasury securities 74,022 — (342) 73,680 Corporate debt securities 18,418 — (86) 18,332 Total short-term investments $ 92,440 $ — $ (428) $ 92,012 Total cash and cash equivalents and investments $ 138,785 $ — $ (428) $ 138,357 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company uses various inputs in determining the fair value of its investments and measures these assets on a recurring basis. Assets and liabilities recorded at fair value in the consolidated balance sheets are categorized by the level of objectivity associated with the inputs used to measure their fair value. The following levels are directly related to the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities: • Level 1 – quoted prices in active markets for identical assets, which include U.S. treasury securities • Level 2 – other significant observable inputs (including quoted prices for similar investments, market corroborated inputs, etc.), which include corporate debt securities • Level 3 – significant unobservable inputs The inputs or methodology used for valuing securities are not necessarily an indication of the credit risk associated with investing in those securities. The following tables provide the fair value measurements of applicable Company assets that are measured at fair value on a recurring basis according to the fair value levels defined above as of December 31, 2023 and 2022. There were no transfers between Level 1 and Level 2 during the periods presented. Assets at Fair Value As of December 31, 2023 Level 1 Level 2 Level 3 Total (in thousands) Cash and cash equivalents $ 22,465 $ — $ — $ 22,465 Short-term investments 141,596 5,965 — 147,561 Total cash and cash equivalents and investments $ 164,061 $ 5,965 $ — $ 170,026 Assets at Fair Value As of December 31, 2022 Level 1 Level 2 Level 3 Total (in thousands) Cash and cash equivalents $ 46,345 $ — $ — $ 46,345 Short-term investments 73,680 18,332 — 92,012 Total cash and cash equivalents and investments $ 120,025 $ 18,332 $ — $ 138,357 |
Supplemental Financial Informat
Supplemental Financial Information | 12 Months Ended |
Dec. 31, 2023 | |
Balance Sheet Related Disclosures [Abstract] | |
Supplemental Financial Information | Supplemental Financial Information The following tables show the Company’s additional balance sheet information as of December 31, 2023 and 2022: As of December 31, 2023 2022 (in thousands) Inventories: Raw materials $ — $ — Work-in-progress 100 — Finished goods 281 — Inventory $ 381 $ — As of December 31, 2023 2022 (in thousands) Accrued Liabilities: Accrued research and development services $ 3,705 $ 3,252 Accrued compensation and benefits 9,591 7,830 Short term lease liability 1,291 1,291 Other 2,570 404 Accrued liabilities $ 17,157 $ 12,777 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment at December 31, 2023 and 2022 are as follows: Estimated Useful Lives As of December 31, In Years 2023 2022 (in thousands) Computers and software 3-5 $ 2,408 $ 2,209 Furniture and fixtures 5-7 1,939 1,794 Leasehold improvements 3-7 2,178 2,052 Total property and equipment 6,525 6,055 Less: Accumulated depreciation and amortization (4,538) (3,984) Net property and equipment $ 1,987 $ 2,071 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Effective Tax Rate Reconciliation. A reconciliation of the statutory tax rate to the effective tax rate for the years ended December 31, 2023, 2022 and 2021 consists of the following: Year Ended December 31, 2023 2022 2021 (in thousands) Expected income tax expense (benefit) at 21% $ (37,196) $ (21,408) $ (18,429) State income taxes, net of federal benefit (3,895) — — Equity compensation 1,530 1,627 851 Research and development credit (712) — — State income taxes, tax rate change (4,723) — — Change in valuation allowance 44,410 19,543 17,210 Other (1) 586 238 368 Income tax benefit $ — $ — $ — (1) Other is primarily comprised of expiring NOLs and nondeductible expenses for the year ended December 31, 2023 and nondeductible expenses for the years ended December 31, 2022 and 2021. Deferred Tax Assets and Liabilities. Lexicon recognizes deferred tax liabilities and assets for the expected future tax consequences of events that have been recognized differently in the financial statements and tax returns. The components of Lexicon’s deferred tax assets (liabilities) at December 31, 2023 and 2022 are as follows: As of December 31, 2023 2022 (in thousands) Deferred tax assets: Net operating loss carryforwards $ 288,264 $ 251,331 Research and development tax credits 30,002 29,290 Orphan drug credits 24,524 24,524 Capitalized research and development 37,357 33,813 Stock-based compensation 6,965 5,445 Interest 1,359 398 Other 3,308 2,255 Total deferred tax assets 391,779 347,056 Deferred tax liabilities: Other (1,608) (1,295) Total deferred tax liabilities (1,608) (1,295) Less: valuation allowance (390,171) (345,761) Net deferred tax liabilities $ — $ — Net Operating Losses/Valuation Allowance. At December 31, 2023, Lexicon had both federal and state NOL carryforwards of approximately $1.3 billion and $169.6 million, respectively. The Company had $606.5 million of U.S. federal NOL carryforwards as of December 31, 2023, which can be carried forward indefinitely. The remaining federal and state NOL carryforwards will begin to expire in 2024. The Company maintains a valuation allowance on net operating losses and other deferred tax assets. Accordingly, the Company has not reported any tax benefit relating to the remaining net operating loss carryforwards and income tax credit carryforwards that are available for utilization in future periods. On a periodic basis, the valuation allowance is reassessed on deferred income tax assets, weighing positive and negative evidence to assess the recoverability of the deferred tax assets. In 2023, the Company reassessed the valuation allowance and considered negative evidence, including the cumulative losses over the three years ended December 31, 2023 and positive evidence including the projections of future income. After assessing both the negative and the positive evidence, the Company concluded that it should continue to maintain the valuation allowance on net operating losses and other deferred tax assets as of December 31, 2023 given the significance of the weight of the negative evidence. Based on recent financial performance and future projections, the Company could record a reversal of all, or a portion of the valuation allowance associated with U.S. deferred tax assets in future periods. However, any such change is subject to actual performance and other considerations that may present positive or negative evidence at the time of the assessment. Significant judgment is required in making these assessments to maintain or reverse valuation allowances and, to the extent future expectations change the Company would have to assess the recoverability of these deferred tax assets at that time. Based on the federal tax law limits and the Company’s cumulative loss position, the Company concluded it was appropriate to establish a full valuation allowance for its net deferred tax assets until an appropriate level of profitability is sustained. During the year ended December 31, 2023, the valuation allowance increased $44.4 million, primarily due to NOLs generated, increases in deferred tax assets associated with capitalized research and development expense and deferred tax assets for state jurisdictions. Other. As of December 31, 2023 and 2022, the Company did not have any unrecognized tax benefits and had no accruals for interest or penalties related to income tax matters. Any interest and penalties related to uncertain tax positions will be reflected as a component of income tax expense. The Company is subject to U.S. federal and state income taxes. The tax years 2020 through 2022 remain open to examination by the Internal Revenue Service of the United Sates and the tax years 2019 through 2022 remain open to examination by various state tax authorities. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill Lexicon recorded goodwill from previous acquisitions prior to 2011 of $44.5 million, representing the excess of purchase price over the fair value of the underlying net identifiable assets including the effects of deferred taxes. Goodwill is not subject to amortization, but is tested at least annually on its assessment date for impairment at the reporting unit level, which is the Company’s single operating segment. There was no impairment of goodwill in 2023, 2022 or 2021. |
Debt Obligations
Debt Obligations | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt Obligations | Debt Obligations Oxford Term Loans. In March 2022, Lexicon and one of its subsidiaries entered into a loan and security agreement with Oxford Finance LLC (“Oxford”) that provides up to $150 million in borrowing capacity (the “Oxford Term Loans”). The loan and security agreement was subsequently amended in August 2022, May 2023, June 2023 and December 2023. The Company incurred debt issuance costs of $0.3 million in connection with the December 2023 amendment which extended the fourth tranche period and modified the existing financial covenant relating to net sales of INPEFA and the minimum cash and investments balance requirement. In March 2024, the Company entered into a fifth amendment further modifying the existing financial covenant relating to net sales of INPEFA. The Oxford Term Loans are available in five tranches, each maturing in March 2027. The first $25 million tranche was funded in March 2022, the second $25 million tranche was funded in December 2022 and the third $50 million tranche was funded in June 2023. The fourth $25 million tranche will be available for draw at Lexicon’s option upon the achievement of specified INPEFA net sales and until April 15, 2025. An unused fee will be due in the event Lexicon does not draw the full amount available under the fourth tranche. The fifth $25 million tranche is available for draw at Lexicon’s option, subject to Oxford’s consent, at any time prior to the expiration of the interest-only payment period as described below. A final payment exit fee equal to 6% of the amount funded under the Oxford Term Loans is due upon prepayment or maturity. The final payment exit fee of $6 million as of December 31, 2023, in the aggregate for the three borrowed tranches, is recorded as a debt discount on the consolidated balance sheet. Concurrent with the funding of the first three tranches, Lexicon granted Oxford warrants to purchase 420,673 shares of Lexicon’s common stock at an exercise price of $2.08 per share, 224,128 shares of Lexicon’s common stock at an exercise price of $1.95 per share and 183,824 shares of Lexicon’s common stock at an exercise price of $2.38 per share, respectively. Subject to and upon funding of the fourth tranche, Lexicon will grant Oxford a warrant to purchase shares of its common stock having a value equal to 1.75% of such tranche, as determined by reference to a 10-day average closing price of the shares, and having an exercise price equal to such average closing price. All warrants are exercisable for five years from their respective grant dates and feature a net cashless exercise provision. The Company allocated the proceeds from each term loan tranche to the corresponding warrant using the relative fair value method and used the Black-Scholes model to calculate the fair value of the warrants. As of December 31, 2023, the carrying value of the Oxford Term Loans on the consolidated balance sheet was $99.5 million, reflecting an unamortized discount of $6.5 million to the face value of long-term debt for the final payment exit fee, the warrant fair value, and debt issuance costs, which are being amortized into interest and other expense throughout the life of the term loan using the effective interest rate method. Monthly interest-only payments are due during an initial 36-month period from the original March 2022 borrowing date. The interest-only period will be followed by an amortization period extending through the maturity date. Payments of $34.8 million, $52.2 million, and $19.0 million, including debt principal and final exit fee payments, will be due during the fiscal years ended December 31, 2025, December 31, 2026 and December 31, 2027, respectively, with respect to all borrowed loan tranches as of December 31, 2023. Prior to the June 2023 amendment to the loan and security agreement, the Oxford Term Loans bore interest at a floating rate equal to the 30-day U.S. Dollar LIBOR plus 7.90%, but not less than 8.01%, subject to additional interest if an event of default occurs and is continuing. Following such amendment, the floating interest rate is based on the sum of (a) the 1-month CME Term Secured Overnight Financing Rate (SOFR), (b) 0.10%, and (c) 7.90% for the first and second tranches and 7% for the third and fourth tranches. As of December 31, 2023, the weighted average interest rate of the Oxford Term Loans was 12.9%. During the year ended December 31, 2023, the Company recognized interest expense of $11.6 million, including $1.5 million in amortization of discount and related debt issuance costs. If an event of default occurs and is continuing, Oxford may declare all amounts outstanding under the loan and security agreement to be immediately due and payable. Additionally, Lexicon may prepay the Oxford Term Loans in whole at its option at any time. Any prepayment of the Oxford Term Loans is subject to prepayment fees for up to three years after the funding of each tranche of the loans. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Operating Lease Obligations. Lexicon’s operating leases include leases of office space in The Woodlands, Texas and Bridgewater, New Jersey that will expire in August 2025 and January 2034, respectively. The Texas lease provides for escalating yearly base rent payments which started at $506,000 and increase to $557,000 in the final year of the lease. The New Jersey lease provides for escalating yearly base rent payments which started at $820,000 and increase to $986,000 in the final year of the lease. Under its lease agreements, Lexicon is obligated to pay property taxes, insurance, and maintenance costs. As of December 31, 2023 and 2022, the right-of-use assets for the office space leases had a balance of $5.5 million and $6.4 million, respectively, which are included in operating lease right-of-use-assets in the consolidated balance sheet. Current and long-term liabilities as of December 31, 2023, relating to the leases were $1.3 million and $5.3 million, respectively, which are included in accrued liabilities and long-term operating lease liabilities in the consolidated balance sheet, respectively. Current and long-term liabilities as of December 31, 2022, relating to the leases were $1.3 million and $5.4 million, respectively, which are included in accrued liabilities and long-term operating lease liabilities in the consolidated balance sheet, respectively. During the years ended December 31, 2023 and 2022, the Company incurred lease expense of $1.6 million and $1.8 million, respectively. During the years ended December 31, 2023 and 2022, the Company made cash payments for lease liabilities of $0.8 million and $1.1 million, respectively. As of December 31, 2023 and 2022, the weighted-average remaining lease terms were 9 years and 9.5 years, respectively, with weighted-average discount rates of 9.6% for each year. The following table reconciles the undiscounted cash flows of the operating lease liability to the recorded lease liability at December 31, 2023: (in thousands) 2024 $ 1,378 2025 1,220 2026 865 2027 881 2028 898 Thereafter 4,746 Total undiscounted operating lease liability $ 9,988 Less: amount of lease payments representing interest (3,432) Present value of future lease payments 6,556 Less: short-term operating lease liability (1,291) Long-term operating lease liability $ 5,265 Employment Arrangements. Lexicon has entered into employment arrangements with certain of its corporate officers. Under the arrangements, each officer receives a base salary, subject to adjustment, with an annual discretionary bonus based upon specific objectives to be determined by the compensation committee. The employment arrangements are at-will and some contain non-competition agreements. Some of the arrangements also provide for certain severance payments for either six or 12 months and, in some cases, payment of a specified portion of the officer’s bonus target for such year, in the event of a specified termination of the officer’s employment. Legal Proceedings. |
Equity Incentive Awards
Equity Incentive Awards | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Equity Incentive Awards | Equity Incentive Awards The Company has stockholder-approved equity incentive plans further described below that permit the grant of stock options, restricted stock unit awards, and other stock-based awards to employees, directors, and consultants of the Company. 2017 Equity Incentive Plan. The Company’s 2017 Equity Incentive Plan permits the grant of incentive stock options to employees and nonstatutory stock options to employees, directors and consultants of the Company. The plan also permits the grant of stock bonus awards, restricted stock awards, restricted stock unit awards, stock appreciation rights and performance stock awards. Incentive and nonstatutory stock options have an exercise price of 100% or more of the fair market value of the Company’s common stock on the date of grant. Most stock options granted under the 2017 Equity Incentive Plan become vested and exercisable over a period of four years. Stock options granted under the Equity Incentive Plan have a term of 10 years from the date of grant. Vesting of restricted stock units issued under this plan generally vest in three annual installments. 2017 Non-Employee Directors’ Equity Incentive Plan (the “Directors’ Plan”). Under the Company’s Directors’ Plan, non-employee directors may be granted awards under the plan with an aggregate grant date fair value of no more than $500,000 during any calendar year, taken together with any cash fees paid to such non-employee director in compensation for service on Lexicon’s board of directors during such calendar year. Stock options granted under the Directors’ Plan have an exercise price equal to the fair market value of the Company’s common stock on the date of grant and a term of 10 years from the date of grant. Vesting of restricted stock units granted under this plan occurs on the first anniversary of the grant date. The total number of shares of common stock that may be issued pursuant to stock awards under the Equity Incentive Plan and the Directors’ Plan shall not exceed in the aggregate 55,000,000 and 2,000,000 shares at December 31, 2023, respectively. Under the combined plans, as of December 31, 2023, an aggregate of 23,719,712 shares of common stock were reserved for issuance upon exercise of outstanding stock options and vesting of outstanding restricted stock units and 24,047,212 additional shares were available for future grants. The Company has a policy of using either authorized and unissued shares or treasury shares, including shares acquired by purchase in the open market or in private transactions, to satisfy equity award exercises. As of December 31, 2023, options to purchase 18,705,022 shares and 5,014,690 restricted stock units were outstanding, 2,285,702 shares had been issued upon the exercise of stock options, 6,730,226 shares had been issued pursuant to restricted stock units and 217,148 shares had been issued pursuant to stock bonus awards or restricted stock awards granted under the aggregate of both plans. For the years ended December 2023, 2022, and 2021 stock-based compensation costs was $14.3 million, $11.5 million, and $10.6 million, respectively. As of December 31, 2023, future stock-based compensation cost for all outstanding unvested stock options and restricted stock units was $26.8 million, which is expected to be recognized over a weighted-average period of 1.2 years. Stock Options. The following is a summary of stock option activity under Lexicon’s equity incentive plans for the year ended December 31, 2023: As of December 31, 2023 (in thousands, except exercise price data) Options Weighted Average Exercise Price Outstanding at beginning of year 12,349 $ 5.10 Granted 8,091 2.29 Exercised — — Expired (152) 14.68 Forfeited (1,583) 3.66 Outstanding at end of year 18,705 3.93 Exercisable at end of year 8,280 $ 5.58 The weighted average estimated grant date fair value of stock options granted during the years ended December 31, 2023, 2022 and 2021 were $1.78, $2.30 and $4.85, respectively. The weighted average remaining contractual term of stock options outstanding and exercisable was 7.5 and 5.6 years, respectively, as of December 31, 2023. At December 31, 2023, the aggregate intrinsic value of the outstanding stock options was $0.4 million. At December 31, 2023, the intrinsic value of exercisable stock options was $0. The fair value of stock options is estimated at the date of grant using the Black-Scholes method requiring the input of subjective assumptions. For purposes of determining the fair value of stock options, the Company segregates its options into two homogeneous groups, based on exercise and post-vesting employment termination behaviors, resulting in different assumptions used for expected option lives. Historical data is used to estimate the expected option life for each group. Expected volatility is based on the historical volatility in the Company’s stock price. The following weighted-average assumptions were used for stock options granted in the years ended December 31, 2023, 2022 and 2021, respectively: Expected Volatility Risk-free Interest Rate Expected Term Dividend December 31, 2023: Employees 110% 3.9% 4 0 % Officers and non-employee directors 98% 4.0% 6 0 % December 31, 2022: Employees 109% 2.8% 4 0 % Officers and non-employee directors 91% 1.9% 7 0 % December 31, 2021: Employees 104% 0.7% 4 0 % Officers and non-employee directors 90% 1% 6 0 % Restricted Stock Units. During the years ended December 31, 2023, 2022 and 2021, Lexicon granted its employees restricted stock units in lieu of or in addition to annual stock option awards. The total fair value of shares vested in 2023, 2022 and 2021 was $2.9 million, $2.9 million and $8.7 million, respectively. During the years ended December 31, 2023, 2022 and 2021, Lexicon granted its non-employee directors 64,256, 74,416 and 32,192 restricted stock units, respectively. The restricted stock granted in 2023, 2022 and 2021 had weighted average grant date fair values of $2.36, $1.77 and $5.04 per share, respectively. The following is a summary of restricted stock units activity under Lexicon’s stock-based compensation plans for the year ended December 31, 2023: Shares Weighted Average Grant Date Fair Value (in thousands) Outstanding at December 31, 2022 2,748 $ 3.78 Granted 4,199 2.43 Vested (1,291) 3.80 Forfeited (641) 2.72 Outstanding at December 31, 2023 5,015 $ 2.78 During the year ended December 31, 2022, the Company issued $6.3 million of Treasury shares in lieu of issuing additional authorized common shares in order to satisfy the annual vesting of restricted stock units for its employees and officers. |
Benefit Plan
Benefit Plan | 12 Months Ended |
Dec. 31, 2023 | |
Defined Contribution Plan [Abstract] | |
Benefit Plan | Benefit Plan Lexicon maintains a defined-contribution savings plan under Section 401(k) of the Internal Revenue Code. The plan covers substantially all full-time employees. Participating employees may defer a portion of their pretax earnings, up to the Internal Revenue Service annual contribution limit. The Company matches employee contributions according to a specified formula. The matching contributions totaled $1.2 million, $0.7 million and $0.4 million in the years ended December 31, 2023, 2022 and 2021, respectively. Company contributions are vested based on the employee’s years of service, with full vesting after four years of service. |
Other Capital Agreements
Other Capital Agreements | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Other Capital Agreements | Other Capital Agreements Common Stock. In June 2023, Lexicon sold an aggregate of 55,288,460 shares of its common stock at a price of $2.60 per share in a public offering and concurrent private placement to an affiliate of Invus, L.P., resulting in net proceeds of approximately $139 million, after deducting underwriting discounts and commissions and offering expenses. In August 2022, Lexicon sold an aggregate of 39,100,000 shares of its common stock at a price of $2.50 per share in a public offering and concurrent private placement to two affiliates of Invus, L.P., resulting in net proceeds of $94.2 million, after deducting underwriting discounts and commissions and offering expenses. In January 2021, Lexicon sold 2,000,000 shares of its common stock at a price of $8.463 per share under a previous Open Market Sale Agreement ™ with Jefferies LLC, resulting in net proceeds of $16.4 million. In August and September 2021, Lexicon sold an aggregate of 4,176,953 shares of its common stock at a price of $4.732 per share under the sales agreement, resulting in net proceeds of $19.1 million. The net proceeds from each of these sales are reflected as issuances of common stock in the accompanying financial statements. Convertible Preferred Stock. On March 11, 2024, Lexicon entered into an agreement with certain accredited investors pursuant to which the Company agreed to sell 2,304,147 shares of its Series A Convertible Preferred Stock, par value $0.01 per share, in a private placement at a price of $108.50 per share. The Company received net proceeds of approximately $242 million, after deducting placement agent fees and offering expenses from the private placement offering. Each share of preferred stock is convertible into 50 shares of common stock. An affiliate of Invus, L.P. elected to participate on the same terms as each other purchaser on a pro rata basis and also agreed to vote at the Company’s 2024 annual meeting of stockholders in favor of the approval of an amendment to the Company’s certificate of incorporation increasing the total authorized common shares thereunder from 300,000,000 to 450,000,000 shares (the “New Charter”). Following the approval of the New Charter by the Company’s shareholders, the adoption of the New Charter by the Company’s board of directors, and the filing and acceptance of the New Charter by the Secretary of State of Delaware, each share of preferred stock will automatically convert into 50 shares (subject to adjustments) of common stock. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net loss | $ (177,119) | $ (101,944) | $ (87,758) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation. |
Use of Estimates | Use of Estimates. The preparation of financial statements in conformity with U. S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. |
Cash, Cash Equivalents and Short-Term Investments | Cash, Cash Equivalents and Short-Term Investments. Lexicon considers all highly-liquid investments with original maturities of three months or less to be cash equivalents. As of December 31, 2023 and 2022, short-term investments consist primarily of U.S. treasury bills as well as certain corporate and other debt securities. The Company’s short-term investments are available for use in current operations regardless of the stated maturity date of the security. These short-term investments are classified as available-for-sale securities as the Company has not historically or does not intend to sell any of its available-for-sale securities prior to their maturity dates. |
Accounts Receivable | Accounts Receivable. |
Concentration of Credit Risk | Concentration of Credit Risk. Lexicon’s cash equivalents, investments and accounts receivable represent potential concentrations of credit risk. The Company attempts to minimize potential concentrations of risk in cash equivalents and investments by placing investments in high-quality financial instruments. The Company has not experienced any realized losses on its cash equivalents or short-term investments. The Company’s accounts receivable are unsecured and are primarily |
Segment Information and Significant Customers | Segment Information and Significant Customers. |
Property and Equipment | Property and Equipment. Property and equipment that is held and used is carried at cost and depreciated using the straight-line method over the estimated useful life of the assets, which ranges from three |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets. Long-lived assets and right-of-use assets for leases are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of assets to be held and used is measured by comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount that the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. There were no impairments of long-lived assets, in 2023, 2022, or 2021. |
Goodwill | Goodwill. |
Leases | Leases. |
Inventory | Inventory: Inventory is comprised of INPEFA, the Company’s approved product that it is commercializing in the United States. Inventories are determined at the lower of cost or market value, with cost determined under the specific identification method. |
Revenue Recognition | Revenue Recognition. The Company performs the following five steps in determining the amount of revenue to recognize as it fulfills its performance obligations under each of its collaborative agreements: (a) identify the contract(s) with a customer; (b) identify the performance obligation in the contract; (c) determine the transaction price; (d) allocate the transaction price to the performance obligation in the contract, and (e) recognize revenue when (or as) the Company satisfies the performance obligation. The Company applies this five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, 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 that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. The Company develops assumptions that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. Product Revenues Product revenues consist of U.S. sales of INPEFA, which Lexicon began shipping to its customers in the U.S. in June 2023. These customers primarily include wholesalers and limited retail pharmacies. The Company is continuing to contract with certain managed care programs or pharmacy benefit managers (“PBMs”) and has legislatively mandated contracts with the federal and state governments under which rebates are provided based on product utilization. Product revenues are recognized when control is transferred to the customer upon delivery. The Company recognizes product revenue net of applicable estimates of reserves for variable consideration using the expected value method. These estimates consider relevant factors such as current contractual and statutory requirements, industry data and forecasted customer buying and payment patterns. Net product revenue includes variable consideration only to the extent that it is probable that a significant reversal in revenue recognized will not occur in a future period. As necessary, these estimates will be adjusted in the period that such variances to actuals become known. Listed below is a further discussion of these reserves and sales return allowances: Customer Credits. The Company’s customers were offered various forms of consideration, including allowances, service fees and prompt payment discounts. The Company records allowances, deducts the full amount of prompt payment discounts, and deducts service fees from total product sales when revenues are earned and recognized. Rebates. Allowances for rebates include mandated discounts under the Medicaid Drug Rebate Program reflecting amounts owed after final dispensing of the product to participants. The Company’s estimates for rebates is based on statutory discount rates, third party market research data and data from sales to its customers. As rebates are generally invoiced and paid in arrears, the Company accrues an estimate of rebates based on the current quarter’s activity, plus any known unpaid prior quarter rebates. Chargebacks. Chargebacks are discounts that occur when contracted healthcare providers purchase directly from a wholesaler. Generally, the contracted healthcare providers purchase INPEFA at a discounted price. The wholesaler, in turn, charges back to Lexicon the difference between the price paid by the wholesaler and the discounted price that the wholesaler’s customer pays for that product. Medicare Part D Coverage Gap. The Medicare Part D prescription drug benefit mandates manufacturers to fund a portion of the Medicare Part D insurance coverage gap for prescription drugs sold to eligible patients. The Company’s estimates for the expected Medicare Part D coverage gap are based on sales data received from a third party and projections based on historical data. As funding of the coverage gap is generally invoiced and paid in arrears, the Company accrues an estimate based on the current quarter’s activity, plus any known unpaid prior quarter estimates. Co-payment assistance. Patients with commercial insurance who meet certain eligibility requirements are eligible to receive co-payment assistance. The Company accrues a liability for co-payment assistance based on actual program participation and estimates of program redemption using data provided by third-party administrators. Sales returns. |
Collaborative Agreements | Collaborative Agreements Revenues under collaborative agreements include both license revenue and contract research revenue. At contract inception, the Company evaluates whether development milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal will not occur, the associated development milestone value is included in the transaction price. Development milestones that are not within the control of the Company or the licensee, including those requiring regulatory approval, are not considered probable of being achieved until those approvals are received. The transaction price is allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue when (or as) the performance obligation is satisfied. At the end of each reporting period, the Company re-evaluates the probability of achievement of the development milestones and any related constraint, and if necessary, adjusts its estimates of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect collaboration revenues in the period of adjustment. For agreements in which a license to the Company’s intellectual property is determined distinct from other performance obligations identified in the agreement, the Company recognizes revenue when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For agreements that include sales-based royalties, including milestones based on a level of sales, the license is deemed to be the predominant item to which the royalties relate and the Company recognizes revenue at the later of (a) when the related sales occur, or (b) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). The Company may receive payments from its licensees based on billing schedules established in each contract. Upfront payments and fees are recorded as deferred revenue upon receipt or when due, and may require deferral of revenue recognition to a future period until the Company performs its obligations under these agreements. Amounts are recorded as accounts receivable when the Company’s right to consideration is unconditional. |
Cost of Sales | Cost of Sales. |
Research and Development Expenses | Research and Development Expenses. |
Stock-Based Compensation | Stock-Based Compensation. Compensation expense related to stock options and restricted stock units (“RSUs”) is determined based on the fair value of the award on the date of the grant and is recognized on a straight-line basis over the vesting period in which an employee is required to provide service. Forfeitures of share-based payment awards are recognized in the period in which they occur. Compensation expense is recorded in research and development expense and selling, general, and administrative expense as noted on the Company’s consolidated statements of comprehensive loss. |
Income Taxes | Income Taxes. |
Net Loss per Common Share | Net Loss per Common Share. Net loss per common share is computed using the weighted average number of shares of common stock outstanding. Shares associated with warrants, stock options and restricted stock units that could potentially dilute earnings per share in the future are not included in the computation of diluted earnings per share because they are antidilutive. |
Recent Accounting Pronouncements Issued But Not Yet Adopted | Recent Accounting Pronouncements Issued But Not Yet Adopted. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures , which is effective retrospectively for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures , which is effective prospectively for annual periods beginning after December 15, 2024. Early adoption is permitted for both standards. We do not expect these accounting pronouncements to have a material impact on our financial statements. |
Cash, Cash Equivalents and In_2
Cash, Cash Equivalents and Investments (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Cash, Cash Equivalents, and Short-Term Investments [Abstract] | |
Schedule of Cash and Cash Equivalents and Investments | The fair value of cash and cash equivalents and investments held at December 31, 2023 and 2022 are as follows: As of December 31, 2023 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Cash and cash equivalents $ 22,465 $ — $ — $ 22,465 Securities maturing within one year: U.S. treasury securities 141,577 31 (12) 141,596 Corporate debt securities 5,954 11 — 5,965 Total short-term investments $ 147,531 $ 42 $ (12) $ 147,561 Total cash and cash equivalents and investments $ 169,996 $ 42 $ (12) $ 170,026 As of December 31, 2022 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Cash and cash equivalents $ 46,345 $ — $ — $ 46,345 Securities maturing within one year: U.S. treasury securities 74,022 — (342) 73,680 Corporate debt securities 18,418 — (86) 18,332 Total short-term investments $ 92,440 $ — $ (428) $ 92,012 Total cash and cash equivalents and investments $ 138,785 $ — $ (428) $ 138,357 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Summary of Fair Value Measurements | The following tables provide the fair value measurements of applicable Company assets that are measured at fair value on a recurring basis according to the fair value levels defined above as of December 31, 2023 and 2022. There were no transfers between Level 1 and Level 2 during the periods presented. Assets at Fair Value As of December 31, 2023 Level 1 Level 2 Level 3 Total (in thousands) Cash and cash equivalents $ 22,465 $ — $ — $ 22,465 Short-term investments 141,596 5,965 — 147,561 Total cash and cash equivalents and investments $ 164,061 $ 5,965 $ — $ 170,026 Assets at Fair Value As of December 31, 2022 Level 1 Level 2 Level 3 Total (in thousands) Cash and cash equivalents $ 46,345 $ — $ — $ 46,345 Short-term investments 73,680 18,332 — 92,012 Total cash and cash equivalents and investments $ 120,025 $ 18,332 $ — $ 138,357 |
Supplemental Financial Inform_2
Supplemental Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of Inventories | The following tables show the Company’s additional balance sheet information as of December 31, 2023 and 2022: As of December 31, 2023 2022 (in thousands) Inventories: Raw materials $ — $ — Work-in-progress 100 — Finished goods 281 — Inventory $ 381 $ — |
Schedule of Accrued Liabilities | As of December 31, 2023 2022 (in thousands) Accrued Liabilities: Accrued research and development services $ 3,705 $ 3,252 Accrued compensation and benefits 9,591 7,830 Short term lease liability 1,291 1,291 Other 2,570 404 Accrued liabilities $ 17,157 $ 12,777 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment | Property and equipment at December 31, 2023 and 2022 are as follows: Estimated Useful Lives As of December 31, In Years 2023 2022 (in thousands) Computers and software 3-5 $ 2,408 $ 2,209 Furniture and fixtures 5-7 1,939 1,794 Leasehold improvements 3-7 2,178 2,052 Total property and equipment 6,525 6,055 Less: Accumulated depreciation and amortization (4,538) (3,984) Net property and equipment $ 1,987 $ 2,071 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Tax Rate Reconciliation | Effective Tax Rate Reconciliation. A reconciliation of the statutory tax rate to the effective tax rate for the years ended December 31, 2023, 2022 and 2021 consists of the following: Year Ended December 31, 2023 2022 2021 (in thousands) Expected income tax expense (benefit) at 21% $ (37,196) $ (21,408) $ (18,429) State income taxes, net of federal benefit (3,895) — — Equity compensation 1,530 1,627 851 Research and development credit (712) — — State income taxes, tax rate change (4,723) — — Change in valuation allowance 44,410 19,543 17,210 Other (1) 586 238 368 Income tax benefit $ — $ — $ — (1) Other is primarily comprised of expiring NOLs and nondeductible expenses for the year ended December 31, 2023 and nondeductible expenses for the years ended December 31, 2022 and 2021. |
Schedule of Deferred Tax Assets (Liabilities) | The components of Lexicon’s deferred tax assets (liabilities) at December 31, 2023 and 2022 are as follows: As of December 31, 2023 2022 (in thousands) Deferred tax assets: Net operating loss carryforwards $ 288,264 $ 251,331 Research and development tax credits 30,002 29,290 Orphan drug credits 24,524 24,524 Capitalized research and development 37,357 33,813 Stock-based compensation 6,965 5,445 Interest 1,359 398 Other 3,308 2,255 Total deferred tax assets 391,779 347,056 Deferred tax liabilities: Other (1,608) (1,295) Total deferred tax liabilities (1,608) (1,295) Less: valuation allowance (390,171) (345,761) Net deferred tax liabilities $ — $ — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Undiscounted Cash Flows of Operating Lease Liability | The following table reconciles the undiscounted cash flows of the operating lease liability to the recorded lease liability at December 31, 2023: (in thousands) 2024 $ 1,378 2025 1,220 2026 865 2027 881 2028 898 Thereafter 4,746 Total undiscounted operating lease liability $ 9,988 Less: amount of lease payments representing interest (3,432) Present value of future lease payments 6,556 Less: short-term operating lease liability (1,291) Long-term operating lease liability $ 5,265 |
Equity Incentive Awards (Tables
Equity Incentive Awards (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Stock Option Activity | Stock Options. The following is a summary of stock option activity under Lexicon’s equity incentive plans for the year ended December 31, 2023: As of December 31, 2023 (in thousands, except exercise price data) Options Weighted Average Exercise Price Outstanding at beginning of year 12,349 $ 5.10 Granted 8,091 2.29 Exercised — — Expired (152) 14.68 Forfeited (1,583) 3.66 Outstanding at end of year 18,705 3.93 Exercisable at end of year 8,280 $ 5.58 |
Summary of Weighted-Average Stock Options Assumptions | The following weighted-average assumptions were used for stock options granted in the years ended December 31, 2023, 2022 and 2021, respectively: Expected Volatility Risk-free Interest Rate Expected Term Dividend December 31, 2023: Employees 110% 3.9% 4 0 % Officers and non-employee directors 98% 4.0% 6 0 % December 31, 2022: Employees 109% 2.8% 4 0 % Officers and non-employee directors 91% 1.9% 7 0 % December 31, 2021: Employees 104% 0.7% 4 0 % Officers and non-employee directors 90% 1% 6 0 % |
Summary of Restricted Stock Units Activity | The following is a summary of restricted stock units activity under Lexicon’s stock-based compensation plans for the year ended December 31, 2023: Shares Weighted Average Grant Date Fair Value (in thousands) Outstanding at December 31, 2022 2,748 $ 3.78 Granted 4,199 2.43 Vested (1,291) 3.80 Forfeited (641) 2.72 Outstanding at December 31, 2023 5,015 $ 2.78 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - segment | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Number of business segments | 1 | ||
Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life of assets | 3 years | ||
Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life of assets | 40 years | ||
Three Customers | Revenue Benchmark | Customer Concentration Risk | |||
Property, Plant and Equipment [Line Items] | |||
Concentration risk percentage | 85% | ||
One Customer | Revenue Benchmark | Customer Concentration Risk | |||
Property, Plant and Equipment [Line Items] | |||
Concentration risk percentage | 100% | ||
Two Customers | Revenue Benchmark | Customer Concentration Risk | |||
Property, Plant and Equipment [Line Items] | |||
Concentration risk percentage | 100% |
Cash, Cash Equivalents and In_3
Cash, Cash Equivalents and Investments - Schedule of Cash and Cash Equivalents and Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Fair Value | ||
Estimated Fair Value | $ 147,561 | $ 92,012 |
Cash and cash equivalents | ||
Fair Value | ||
Amortized Cost | 22,465 | 46,345 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 22,465 | 46,345 |
Total short-term investments | ||
Fair Value | ||
Amortized Cost | 147,531 | 92,440 |
Gross Unrealized Gains | 42 | 0 |
Gross Unrealized Losses | (12) | (428) |
Estimated Fair Value | 147,561 | 92,012 |
U.S. treasury securities | ||
Fair Value | ||
Amortized Cost | 141,577 | 74,022 |
Gross Unrealized Gains | 31 | 0 |
Gross Unrealized Losses | (12) | (342) |
Estimated Fair Value | 141,596 | 73,680 |
Corporate debt securities | ||
Fair Value | ||
Amortized Cost | 5,954 | 18,418 |
Gross Unrealized Gains | 11 | 0 |
Gross Unrealized Losses | 0 | (86) |
Estimated Fair Value | 5,965 | 18,332 |
Total cash and cash equivalents and investments | ||
Fair Value | ||
Amortized Cost | 169,996 | 138,785 |
Gross Unrealized Gains | 42 | 0 |
Gross Unrealized Losses | (12) | (428) |
Estimated Fair Value | $ 170,026 | $ 138,357 |
Cash, Cash Equivalents and In_4
Cash, Cash Equivalents and Investments - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash, Cash Equivalents, and Short-Term Investments [Abstract] | |||
Investments in an unrealized loss position, fair value | $ 58,500,000 | $ 89,000,000 | |
Realized gains (losses) | $ 0 | $ 0 | $ 0 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Fair Value | ||
Cash and cash equivalents | $ 22,465 | $ 46,345 |
Short-term investments | 147,561 | 92,012 |
Total cash and cash equivalents and investments | 170,026 | 138,357 |
Level 1 | ||
Fair Value | ||
Cash and cash equivalents | 22,465 | 46,345 |
Short-term investments | 141,596 | 73,680 |
Total cash and cash equivalents and investments | 164,061 | 120,025 |
Level 2 | ||
Fair Value | ||
Cash and cash equivalents | 0 | 0 |
Short-term investments | 5,965 | 18,332 |
Total cash and cash equivalents and investments | 5,965 | 18,332 |
Level 3 | ||
Fair Value | ||
Cash and cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
Total cash and cash equivalents and investments | $ 0 | $ 0 |
Supplemental Financial Inform_3
Supplemental Financial Information (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Inventories: | ||
Raw materials | $ 0 | $ 0 |
Work-in-progress | 100 | 0 |
Finished goods | 281 | 0 |
Inventory | 381 | 0 |
Accrued Liabilities: | ||
Accrued research and development services | 3,705 | 3,252 |
Accrued compensation and benefits | $ 9,591 | $ 7,830 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued liabilities | Accrued liabilities |
Short term lease liability | $ 1,291 | $ 1,291 |
Other | 2,570 | 404 |
Accrued liabilities | $ 17,157 | $ 12,777 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 6,525 | $ 6,055 |
Less: Accumulated depreciation and amortization | (4,538) | (3,984) |
Net property and equipment | $ 1,987 | 2,071 |
Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 3 years | |
Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 40 years | |
Computers and software | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 2,408 | 2,209 |
Computers and software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 3 years | |
Computers and software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 5 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 1,939 | 1,794 |
Furniture and fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 5 years | |
Furniture and fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 7 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 2,178 | $ 2,052 |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 3 years | |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 7 years |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Expected income tax expense (benefit) at 21% | $ (37,196) | $ (21,408) | $ (18,429) |
State income taxes, net of federal benefit | (3,895) | 0 | 0 |
Equity compensation | 1,530 | 1,627 | 851 |
Research and development credit | (712) | 0 | 0 |
State income taxes, tax rate change | (4,723) | 0 | 0 |
Change in valuation allowance | 44,410 | 19,543 | 17,210 |
Other | 586 | 238 | 368 |
Income tax benefit | $ 0 | $ 0 | $ 0 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets (Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 288,264 | $ 251,331 |
Research and development tax credits | 30,002 | 29,290 |
Orphan drug credits | 24,524 | 24,524 |
Capitalized research and development | 37,357 | 33,813 |
Stock-based compensation | 6,965 | 5,445 |
Interest | 1,359 | 398 |
Other | 3,308 | 2,255 |
Total deferred tax assets | 391,779 | 347,056 |
Deferred tax liabilities: | ||
Other | (1,608) | (1,295) |
Total deferred tax liabilities | (1,608) | (1,295) |
Less: valuation allowance | (390,171) | (345,761) |
Net deferred tax liabilities | $ 0 | $ 0 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Operating Loss Carryforwards [Line Items] | ||
Increase in valuation allowance | $ 44,400 | |
Unrecognized tax benefits | 0 | $ 0 |
Accruals for interest or penalties | 0 | $ 0 |
Domestic Tax Authority | ||
Operating Loss Carryforwards [Line Items] | ||
NOL carryforwards | 1,300,000 | |
Indefinite NOL carryforwards | 606,500 | |
State and Local Jurisdiction | ||
Operating Loss Carryforwards [Line Items] | ||
NOL carryforwards | $ 169,600 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Jul. 30, 2010 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Goodwill | $ 44,543 | $ 44,543 | $ 44,500 | |
Goodwill impairment | $ 0 | $ 0 | $ 0 |
Debt Obligations (Details)
Debt Obligations (Details) | 1 Months Ended | 12 Months Ended | ||||||
May 31, 2023 | Jun. 30, 2023 USD ($) $ / shares Rate shares | Dec. 31, 2027 USD ($) | Dec. 31, 2026 USD ($) | Dec. 31, 2025 USD ($) | Dec. 31, 2023 USD ($) d Rate | Dec. 31, 2022 USD ($) $ / shares shares | Mar. 31, 2022 USD ($) $ / shares shares | |
Line of Credit Facility [Line Items] | ||||||||
Long-term debt, net | $ 99,508,000 | $ 48,579,000 | ||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Term loan borrowing capacity | $ 150,000,000 | |||||||
Debt issuance costs | $ 300,000 | |||||||
Exit fee percentage | Rate | 6% | |||||||
Exit fee payment | $ 6,000,000 | |||||||
Term for exercise of warrants | 5 years | |||||||
Long-term debt, net | $ 99,500,000 | |||||||
Unamortized discount on debt | $ 6,500,000 | |||||||
Interest-only payment period | 36 months | |||||||
Weighted average interest rate | 8.01% | 12.90% | ||||||
Incremental interest rate | Rate | 0.10% | |||||||
Interest expense | $ 11,600,000 | |||||||
Amortization of discount and related debt costs | 1,500,000 | |||||||
Minimum required cash and investments balance | $ 10,000,000 | |||||||
Covenant compliance period | 1 year | |||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | LIBOR | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Basis spread on variable rate | 7.90% | |||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | Forecast | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Debt payments | $ 19,000,000 | $ 52,200,000 | $ 34,800,000 | |||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | First Tranche | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Term loan funded | $ 25,000,000 | |||||||
Warrants outstanding (in shares) | shares | 420,673 | |||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 2.08 | |||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | First Tranche | SOFR | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Basis spread on variable rate | 7.90% | |||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | Second Tranche | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Term loan funded | $ 25,000,000 | |||||||
Warrants outstanding (in shares) | shares | 224,128 | |||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 1.95 | |||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | Second Tranche | SOFR | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Basis spread on variable rate | 7.90% | |||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | Third Tranche | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Term loan funded | $ 50,000,000 | |||||||
Warrants outstanding (in shares) | shares | 183,824 | |||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 2.38 | |||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | Third Tranche | SOFR | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Basis spread on variable rate | Rate | 7% | |||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | Fourth Tranche | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Remaining term loan funding | $ 25,000,000 | |||||||
Warrant, percentage of fourth tranche | Rate | 1.75% | |||||||
Number of days to determine average closing price of warrant shares | d | 10 | |||||||
Minimum required cash and investments balance | $ 25,000,000 | |||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | Fourth Tranche | SOFR | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Basis spread on variable rate | Rate | 7% | |||||||
Term Loan | Oxford Finance LLC Term Loans | Line of Credit | Fifth Tranche | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Remaining term loan funding | $ 25,000,000 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Other Commitments [Line Items] | ||
Rent payments | $ 800 | $ 1,100 |
Operating lease right-of-use-assets | 5,524 | 6,407 |
Short term lease liability | 1,291 | 1,291 |
Long-term operating lease liabilities | 5,265 | 5,424 |
Lease expense | $ 1,600 | $ 1,800 |
Weighted-average remaining lease term | 9 years | 9 years 6 months |
Weighted-average discount rate | 9.60% | 9.60% |
Minimum | TEXAS | ||
Other Commitments [Line Items] | ||
Rent payments | $ 506 | |
Minimum | NEW JERSEY | ||
Other Commitments [Line Items] | ||
Rent payments | 820 | |
Maximum | TEXAS | ||
Other Commitments [Line Items] | ||
Rent payments | 557 | |
Maximum | NEW JERSEY | ||
Other Commitments [Line Items] | ||
Rent payments | $ 986 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Undiscounted Cash Flows of Operating Lease Liability (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
2024 | $ 1,378 | |
2025 | 1,220 | |
2026 | 865 | |
2027 | 881 | |
2028 | 898 | |
Thereafter | 4,746 | |
Total undiscounted operating lease liability | 9,988 | |
Less: amount of lease payments representing interest | (3,432) | |
Present value of future lease payments | 6,556 | |
Less: short-term operating lease liability | (1,291) | $ (1,291) |
Long-term operating lease liabilities | $ 5,265 | $ 5,424 |
Equity Incentive Awards - Narra
Equity Incentive Awards - Narrative (Details) - USD ($) | 12 Months Ended | 84 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Common stock available for future grants (in shares) | 24,047,212 | 24,047,212 | ||
Options outstanding (in shares) | 23,719,712 | 23,719,712 | ||
Stock-based compensation costs | $ 14,300,000 | $ 11,500,000 | $ 10,600,000 | |
Future stock-based compensation cost for outstanding unvested awards | $ 26,800,000 | $ 26,800,000 | ||
Future stock-based compensation cost for outstanding unvested awards, weighted-average recognition period | 1 year 2 months 12 days | |||
Issuance of treasury stock | 0 | |||
Treasury Stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Issuance of treasury stock | $ 6,321,000 | |||
Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Aggregate value | $ 400,000 | $ 400,000 | ||
Common stock reserved for issuance, exercisable (in shares) | 8,280,000 | 8,280,000 | ||
Options outstanding (in shares) | 18,705,000 | 12,349,000 | 18,705,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 0 | |||
Weighted average estimated grant date fair value (in dollars per share) | $ 1.78 | $ 2.30 | $ 4.85 | |
Weighted average remaining contractual term of stock options outstanding | 7 years 6 months | |||
Weighted average remaining contractual term of stock options exercisable | 5 years 7 months 6 days | |||
Aggregate intrinsic value of exercisable stock options | $ 0 | $ 0 | ||
Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock units outstanding (in shares) | 5,015,000 | 2,748,000 | 5,015,000 | |
Fair value of shares vested | $ 2,900,000 | $ 2,900,000 | $ 8,700,000 | |
Granted (in shares) | 4,199,000 | |||
Weighted average grant date fair value (in dollars per share) | $ 2.43 | |||
Restricted Stock Units (RSUs) | Officers and non-employee directors | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in shares) | 64,256 | 74,416 | 32,192 | |
Weighted average grant date fair value (in dollars per share) | $ 2.36 | $ 1.77 | $ 5.04 | |
2017 Equity Incentive Plan and 2017 Non-Employee Directors' Equity Incentive Plan | Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options outstanding (in shares) | 18,705,022 | 18,705,022 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 2,285,702 | |||
2017 Equity Incentive Plan and 2017 Non-Employee Directors' Equity Incentive Plan | Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock units outstanding (in shares) | 5,014,690 | 5,014,690 | ||
Common stock issued (in shares) | 6,730,226 | |||
2017 Equity Incentive Plan and 2017 Non-Employee Directors' Equity Incentive Plan | Restricted Stock Award (RSAs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Common stock issued (in shares) | 217,148 | |||
2017 Equity Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock options exercise price, percent of fair market value on date of grant | 100% | |||
Vesting period | 4 years | |||
Award term | 10 years | |||
Common stock authorized (in shares) | 55,000,000 | 55,000,000 | ||
2017 Equity Incentive Plan | Restricted Stock Units (RSUs) | Share-Based Payment Arrangement, Tranche One | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting percentage | 33.33% | |||
2017 Equity Incentive Plan | Restricted Stock Units (RSUs) | Share-Based Payment Arrangement, Tranche Two | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting percentage | 33.33% | |||
2017 Equity Incentive Plan | Restricted Stock Units (RSUs) | Share-Based Payment Arrangement, Tranche Three | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting percentage | 33.33% | |||
2017 Non-Employee Directors' Equity Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award term | 10 years | |||
Common stock authorized (in shares) | 2,000,000 | 2,000,000 | ||
2017 Non-Employee Directors' Equity Incentive Plan | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Aggregate value | $ 500,000 | $ 500,000 | ||
2017 Non-Employee Directors' Equity Incentive Plan | Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 1 year |
Equity Incentive Awards - Summa
Equity Incentive Awards - Summary of Stock Option Activity (Details) - $ / shares | 12 Months Ended |
Dec. 31, 2023 | |
Options | |
Outstanding at end of year (in shares) | 23,719,712 |
Options | |
Options | |
Outstanding at beginning of year (in shares) | 12,349,000 |
Granted (in shares) | 8,091,000 |
Exercised (in shares) | 0 |
Expired (in shares) | (152,000) |
Forfeited (in shares) | (1,583,000) |
Outstanding at end of year (in shares) | 18,705,000 |
Exercisable (in shares) | 8,280,000 |
Weighted Average Exercise Price | |
Outstanding at beginning of year (in dollars per share) | $ 5.10 |
Granted (in dollars per share) | 2.29 |
Exercised (in dollars per share) | 0 |
Expired (in dollars per share) | 14.68 |
Forfeited (in dollars per share) | 3.66 |
Outstanding at end of year (in dollars per share) | 3.93 |
Exercisable (in dollars per share) | $ 5.58 |
Equity Incentive Awards - Sum_2
Equity Incentive Awards - Summary of Weighted-Average Stock Options Assumptions (Details) - Options | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Employees | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected Volatility | 110% | 109% | 104% |
Risk-free Interest Rate | 3.90% | 2.80% | 0.70% |
Expected Term | 4 years | 4 years | 4 years |
Dividend Rate | 0% | 0% | 0% |
Officers and non-employee directors | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected Volatility | 98% | 91% | 90% |
Risk-free Interest Rate | 4% | 1.90% | 1% |
Expected Term | 6 years | 7 years | 6 years |
Dividend Rate | 0% | 0% | 0% |
Equity Incentive Awards - Sum_3
Equity Incentive Awards - Summary of Restricted Stock Units Activity (Details) - Restricted Stock Units (RSUs) shares in Thousands | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Shares | |
Outstanding at beginning of period (in shares) | shares | 2,748 |
Granted (in shares) | shares | 4,199 |
Vested (in shares) | shares | (1,291) |
Forfeited (in shares) | shares | (641) |
Outstanding at end of period (in shares) | shares | 5,015 |
Weighted Average Grant Date Fair Value | |
Outstanding at beginning of period (in dollars per share) | $ / shares | $ 3.78 |
Granted (in dollars per share) | $ / shares | 2.43 |
Vested (in dollars per share) | $ / shares | 3.80 |
Forfeited (in dollars per share) | $ / shares | 2.72 |
Outstanding at end of period (in dollars per share) | $ / shares | $ 2.78 |
Benefit Plan (Details)
Benefit Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Defined Contribution Plan [Abstract] | |||
Matching contributions | $ 1.2 | $ 0.7 | $ 0.4 |
Years of service | 4 years |
Other Capital Agreements (Detai
Other Capital Agreements (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 2 Months Ended | 12 Months Ended | |||||
Mar. 11, 2024 | Jun. 30, 2023 | Aug. 31, 2022 | Jan. 31, 2021 | Sep. 30, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Class of Stock [Line Items] | ||||||||
Shares sold | 55,288,460 | 39,100,000 | 2,000,000 | 4,176,953 | ||||
Shares sold, price per share (usd per share) | $ 2.60 | $ 2.50 | $ 8.463 | $ 4.732 | ||||
Proceeds from issuance of common stock, net of fees | $ 139,000 | $ 94,200 | $ 16,400 | $ 19,100 | $ 138,823 | $ 94,205 | $ 37,084 | |
Preferred stock, par value per share (usd per share) | $ 0.01 | $ 0.01 | ||||||
Common stock, shares authorized | 300,000,000 | 300,000,000 | ||||||
Subsequent Event | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock, shares authorized | 450,000,000 | |||||||
Subsequent Event | Private Placement | ||||||||
Class of Stock [Line Items] | ||||||||
Net proceeds from sale of stock | $ 242,000 | |||||||
Number of common stock shares issued for each preferred stock share upon conversion | 50 | |||||||
Series A Preferred Stock | Subsequent Event | Private Placement | ||||||||
Class of Stock [Line Items] | ||||||||
Shares sold | 2,304,147 | |||||||
Preferred stock, par value per share (usd per share) | $ 0.01 | |||||||
Sale of stock, price per share (usd per share) | $ 108.50 |