Document And Entity Information
Document And Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 17, 2020 | Jun. 30, 2019 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2019 | ||
Entity File Number | 001-36860 | ||
Entity Registrant Name | IOVANCE BIOTHERAPEUTICS, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 75-3254381 | ||
Entity Address, Address Line One | 999 Skyway Road, Suite 150 | ||
Entity Address, City or Town | San Carlos | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94070 | ||
City Area Code | 650 | ||
Local Phone Number | 260-7120 | ||
Title of 12(b) Security | Common Stock, $ 0.000041666 Par Value per Share | ||
Trading Symbol | IOVA | ||
Security Exchange Name | NASDAQ | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 126,498,470 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001425205 | ||
Amendment Flag | false | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Public Float | $ 2.9 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current Assets | ||
Cash and cash equivalents | $ 13,969 | $ 82,152 |
Short-term Investments | 293,112 | 386,371 |
Prepaid expenses and other assets | 9,412 | 6,851 |
Total Current Assets | 316,493 | 475,374 |
Operating lease right-of-use assets | 10,695 | |
Property and equipment, net | 8,536 | 2,683 |
Restricted cash | 5,450 | |
Long-term assets | 3,481 | 2,764 |
Total Assets | 344,655 | 480,821 |
Current Liabilities | ||
Accounts payable | 15,567 | 2,739 |
Accrued expenses | 16,265 | 11,659 |
Operating lease liabilities | 7,252 | |
Total Current Liabilities | 39,084 | 14,398 |
Non-Current Liabilities | ||
Operating lease liabilities | 4,248 | |
Other liabilities | 2,352 | 230 |
Total Non-Current Liabilities | 6,600 | 230 |
Total Liabilities | 45,684 | 14,628 |
Stockholders' Equity | ||
Common stock, $0.000041666 par value; 300,000,000 and 150,000,000 shares authorized, 126,411,808 and 123,415,576 shares issued and outstanding as of December 31, 2019 and December 31, 2018, respectively | 5 | 5 |
Accumulated other comprehensive loss | 220 | (42) |
Additional paid-in capital | 869,354 | 838,984 |
Accumulated deficit | (570,612) | (372,760) |
Total Stockholders' Equity | 298,971 | 466,193 |
Total Liabilities and Stockholders' Equity | 344,655 | 480,821 |
Series B Convertible Preferred Stock | ||
Stockholders' Equity | ||
Preferred stock, Value | 4 | 6 |
Total Stockholders' Equity | $ 4 | $ 6 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Preferred Stock, Shares Authorized | 50,000,000 | |
Common Stock, Par or Stated Value Per Share | $ 0.000041666 | $ 0.000041666 |
Common Stock, Shares Authorized | 300,000,000 | 150,000,000 |
Common Stock, Shares, Issued | 126,411,808 | 123,415,576 |
Common Stock, Shares, Outstanding | 126,411,808 | 123,415,576 |
Series A Convertible Preferred Stock | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Preferred Stock, Shares Authorized | 17,000 | 17,000 |
Preferred Stock, Shares Issued | 194 | 194 |
Preferred Stock, Shares Outstanding | 194 | 194 |
Preferred Stock, Liquidation Preference, Value | $ 194 | $ 194 |
Series B Convertible Preferred Stock | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Preferred Stock, Shares Authorized | 11,500,000 | 11,500,000 |
Preferred Stock, Shares Issued | 3,581,119 | 5,854,845 |
Preferred Stock, Shares Outstanding | 3,581,119 | 5,854,845 |
Preferred Stock, Liquidation Preference, Value | $ 17,010 | $ 17,010 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Costs and expenses | |||
Research and development expenses | $ 166,023 | $ 99,828 | $ 71,615 |
General and administrative expenses | 40,849 | 28,430 | 21,262 |
Total costs and expenses | 206,872 | 128,258 | 92,877 |
Loss from operations | (206,872) | (128,258) | (92,877) |
Other income | |||
Interest income, net | 9,316 | 4,678 | 813 |
Net Loss | $ (197,556) | $ (123,580) | $ (92,064) |
Net Loss Per Common Share, Basic and Diluted | $ (1.59) | $ (1.27) | $ (1.41) |
Weighted Average Common Shares Outstanding, Basic and Diluted | 124,336 | 97,277 | 65,242 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Condensed Consolidated Statements of Comprehensive Loss | |||
Net Loss | $ (197,556) | $ (123,580) | $ (92,064) |
Other comprehensive gain (loss): | |||
Net unrealized gain (loss) on short-term investments | 262 | (42) | (29) |
Comprehensive Loss | $ (197,294) | $ (123,622) | $ (92,093) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Series A Convertible Preferred Stock | Series B Convertible Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated other Comprehensive Income | Accumulated Deficit | Total |
Beginning Balance at Dec. 31, 2016 | $ 8 | $ 3 | $ 323,994 | $ 29 | $ (157,116) | $ 166,918 | |
Beginning Balance (in Shares) at Dec. 31, 2016 | 1,694 | 7,946,673 | 62,248,074 | ||||
Stock-based compensation expense | 11,968 | 11,968 | |||||
Vesting of restricted shares issued for services (in shares) | 225,970 | ||||||
Tax payments related to shares withheld for vested restricted stock awards | (1,252) | (1,252) | |||||
Common stock issued upon exercise of warrants | 662 | 662 | |||||
Common stock issued upon exercise of warrants (in Shares) | 265,000 | ||||||
Common stock issued upon exercise of stock options | 5,616 | 5,616 | |||||
Common stock issued upon exercise of stock options (in shares) | 1,011,284 | ||||||
Unrealized loss on short-term investments | (29) | (29) | |||||
Common stock sold in public offering, net of offering costs | 53,662 | 53,662 | |||||
Common stock sold in public offering, net of offering costs (in shares) | 8,846,154 | ||||||
Conversion of convertible preferred stock into common stock | $ (1) | 1 | |||||
Conversion of convertible preferred stock into common stock (in Shares) | (568,432) | 568,432 | |||||
Net loss | (92,064) | (92,064) | |||||
Ending Balance at Dec. 31, 2017 | $ 7 | $ 3 | 394,651 | (249,180) | 145,481 | ||
Ending Balance (in Shares) at Dec. 31, 2017 | 1,694 | 7,378,241 | 73,164,914 | ||||
Stock-based compensation expense | 20,027 | 20,027 | |||||
Vesting of restricted shares issued for services (in shares) | 45,833 | ||||||
Tax payments related to shares withheld for vested restricted stock awards | (223) | (223) | |||||
Common stock issued upon exercise of warrants | $ 1 | 15,753 | 15,754 | ||||
Common stock issued upon exercise of warrants (in Shares) | 6,301,216 | ||||||
Common stock issued upon exercise of stock options | 9,959 | 9,959 | |||||
Common stock issued upon exercise of stock options (in shares) | 1,336,514 | ||||||
Unrealized loss on short-term investments | (42) | (42) | |||||
Common stock sold in public offering, net of offering costs | $ 1 | 398,816 | 398,817 | ||||
Common stock sold in public offering, net of offering costs (in shares) | 40,300,000 | ||||||
Conversion of convertible preferred stock into common stock | $ (1) | 1 | |||||
Conversion of convertible preferred stock into common stock (in Shares) | (1,500) | (1,523,396) | 2,273,396 | ||||
Cancellation of restricted shares (in Shares) | (6,297) | ||||||
Net loss | (123,580) | (123,580) | |||||
Ending Balance at Dec. 31, 2018 | $ 6 | $ 5 | 838,984 | (42) | (372,760) | 466,193 | |
Ending Balance (in Shares) at Dec. 31, 2018 | 194 | 5,854,845 | 123,415,576 | ||||
Stock-based compensation expense | 24,277 | 24,277 | |||||
Vesting of restricted shares issued for services | $ 1 | (1) | |||||
Vesting of restricted shares issued for services (in shares) | 27,514 | ||||||
Tax payments related to shares withheld for vested restricted stock awards | (312) | (312) | |||||
Common stock issued upon exercise of stock options | 6,443 | 6,443 | |||||
Common stock issued upon exercise of stock options (in shares) | 727,492 | ||||||
Unrealized loss on short-term investments | 262 | 262 | |||||
Common stock issued from preferred stock conversion | $ (2) | 2 | |||||
Common stock issued from preferred stock conversion (in Shares) | (2,273,726) | 2,273,726 | |||||
Cancellation of common shares from settlement of dispute | $ (1) | (335) | (336) | ||||
Cancellation of common shares from settlement of dispute (In Shares) | (32,500) | ||||||
Net loss | (197,556) | (197,556) | |||||
Ending Balance at Dec. 31, 2019 | $ 4 | $ 5 | 869,354 | $ 220 | (570,612) | $ 298,971 | |
Ending Balance (in Shares) at Dec. 31, 2019 | 194 | 3,581,119 | 126,411,808 | ||||
Adoption of ASU 2018-07 | $ 296 | $ (296) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash Flows from Operating Activities | |||
Net loss | $ (197,556) | $ (123,580) | $ (92,064) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Stock-based compensation expense | 24,277 | 20,027 | 11,968 |
Noncash lease expense | 6,954 | ||
Accretion (amortization) of discounts and premiums on investments | (3,421) | (1,332) | 19 |
Depreciation and amortization | 1,169 | 956 | 952 |
Gain on settlement of dispute | (336) | ||
Loss on disposal of assets | 16 | 9 | |
Changes in assets and liabilities: | |||
Prepaid expenses, other assets, and long-term assets | (3,278) | (2,065) | (4,508) |
Operating lease liabilities (Right-of-use assets) | (6,148) | ||
Accounts payable | 12,706 | 1,507 | 369 |
Accrued expenses and other liabilities | 6,728 | 3,229 | 4,555 |
Net cash used in operating activities | (158,889) | (101,249) | (78,709) |
Cash Flows from Investing Activities | |||
Maturities of short-term investments | 514,601 | 41,000 | 59,705 |
Purchase of short-term investments | (417,659) | (426,081) | |
Purchase of property and equipment | (6,917) | (1,198) | (1,028) |
Net cash provided by (used in) investing activities | 90,025 | (386,279) | 58,677 |
Cash Flows from Financing Activities | |||
Tax payments related to shares withheld for vested restricted stock awards | (312) | (223) | (1,252) |
Proceeds from the issuance of common stock upon exercise of warrants | 15,754 | 662 | |
Proceeds from the issuance of common stock upon exercise of options | 6,443 | 9,959 | 5,616 |
Proceeds from the issuance of preferred stock and common stock, net | 398,817 | 53,662 | |
Net cash provided by financing activities | 6,131 | 424,307 | 58,688 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (62,733) | (63,221) | 38,656 |
Cash, Cash Equivalents, and Restricted Cash Beginning of Period | 82,152 | 145,373 | 106,717 |
Cash, Cash Equivalents, and Restricted Cash End of Period | 19,419 | 82,152 | 145,373 |
Supplemental disclosure of non-cash investing and financing activities: | |||
Net unrealized gain (loss) on short-term investments | 262 | (42) | (29) |
Acquisitions of property and equipment included in accounts payable | 122 | ||
Conversion of convertible preferred stock to common stock | $ 2 | $ 1 | $ 1 |
GENERAL ORGANIZATION AND BUSINE
GENERAL ORGANIZATION AND BUSINESS | 12 Months Ended |
Dec. 31, 2019 | |
GENERAL ORGANIZATION AND BUSINESS | |
GENERAL ORGANIZATION AND BUSINESS | NOTE 1. GENERAL ORGANIZATION, BUSINESS AND LIQUIDITY General Organization and Business Iovance Biotherapeutics, Inc. (the “Company”, “we”, “us” or “our”) is a clinical-stage biopharmaceutical company focused on the development and commercialization of cell therapies as novel cancer immunotherapy products designed to harness the power of a patient’s own immune system to eradicate cancer cells. Tumor infiltrating lymphocyte or TIL therapy is an autologous cell therapy platform technology that was originally developed by the National Cancer Institute (NCI), which conducted initial clinical trials in diseases such as metastatic melanoma and cervical cancer. The Company has developed a new, shorter manufacturing process for TIL therapy known as Generation 2, or Gen 2, which yields a cryopreserved TIL product. This proprietary and scalable manufacturing method is being further investigated in multiple indications. The Company’s lead product candidates include lifileucel for metastatic melanoma and LN-145 for metastatic cervical cancer. In addition to metastatic melanoma and metastatic cervical cancer, it is investigating the effectiveness and safety of TIL therapy and peripheral blood lymphocyte therapy for the treatment of squamous cell carcinoma of the head and neck, non-small cell lung cancer, and chronic lymphocytic leukemia through its sponsored trials, as well as in other oncology indications through collaborations. On June 1, 2017, the Company reincorporated to become a company governed by Delaware corporation laws. Liquidity The Company is currently engaged in the development of therapeutics to fight cancer, specifically solid tumors. The Company currently does not have any commercial products and has not yet generated any revenues from its business. The Company currently does not anticipate that it will generate any revenues from the sale or licensing of any of its product candidates during the 12 months from the date these financial statements are issued. The Company has incurred a net loss of $197.6 million for the year ended December 31, 2019 and used $158.9 million of cash in its operating activities during the year ended December 31, 2019. As of December 31, 2019, the Company had $312.5 million in cash, cash equivalents, short-term investments, and restricted cash ( $14.0 million of cash and cash equivalents, $293.1 million in short-term investments and $5.5 million in restricted cash). The Company expects to further increase its research and development activities, which will increase the amount of cash used during 2020 and beyond. Specifically, the Company expects continued spending on its current and planned clinical trials, continued expansion of manufacturing activities, including construction of a manufacturing facility, higher payroll expenses as the Company increases its professional and scientific staff, and initiation of pre-commercial activities. Based on the funds the Company has available as of the date these financial statements are issued, the Company believes that it has sufficient capital to fund its anticipated operating expenses and capital expenditures for at least next twelve months from the date these financial statements are issued. The Company has latitude as to the timing and amount of expenditures for its commercial-scale production facility under construction in Philadelphia, Pennsylvania. Concentrations of Risk The Company is subject to credit risk from its portfolio of cash equivalents and short-term investments. Under its investment policy, the Company limits amounts invested in such securities by credit rating, maturity, industry group, investment type and issuer, except for securities issued by the U.S. government. The Company does not believe it is exposed to any significant concentrations of credit risk from these financial instruments. The goals of its investment policy, in order of priority, are as follows: safety and preservation of principal and diversification of risk and liquidity of investments sufficient to meet cash flow requirements. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES | |
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES Cash, Cash Equivalents, and Short-term Investments The Company’s cash and cash equivalents include short-term investments with original maturities of three months or less when purchased. The Company's short-term investments are classified as “available-for-sale”. The Company includes these investments in current assets and carries them at fair value. Unrealized gains and losses on available-for-sale securities are included in accumulated other comprehensive loss. The cost of debt securities is adjusted for the amortization of premiums and accretion of discounts to maturity. Such amortization and accretion are included in net interest income in the consolidated statements of operations. Gains and losses on securities sold are recorded based on the specific identification method and are included in net interest income in the consolidated statements of operations. The Company has not incurred any realized gains or losses from sales of securities to date. The Company’s investment policy limits investments to certain types of instruments such as certificates of deposit, money market instruments, obligations issued by the U.S. government and U.S. government agencies as well as corporate debt securities, and places restrictions on maturities and concentration by type and issuer. Restricted Cash The Company maintains a certain minimum balance, currently $5.5 million in a segregated bank account in connection with a letter of credit for the benefit of the landlord for its commercial manufacturing facility used as a security deposit for the lease (See Note 10 - Leases). This amount is classified as Restricted Cash on the Balance Sheet. The letter of credit will expire on May 28, 2020, however, it will be automatically extended, without written agreement, for one-year periods to May 28 in each succeeding calendar year, through at least 60 days after the lease expiration date. Further, on the expiration of the seventh year of the lease, and each anniversary date thereafter, the letter of credit may be decreased by $1.0 million, with a minimum security deposit of $1.5 million maintained through the end of the lease term. As of December 31, 2019, restricted cash consisted of $5.5 million and this amount has been classified as a non-current asset on the Company’s consolidated balance sheets. The following table provides a reconciliation of cash, cash equivalents, and restricted cash, reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows: December 31, December 31, December 31, 2019 2018 2017 Cash $ 13,969 $ 82,152 $ 145,373 Restricted cash (included in non-current assets on the consolidated balance sheets) 5,450 — — Total cash, cash equivalents and restricted cash $ 19,419 $ 82,152 $ 145,373 Property and Equipment, net Property and equipment is stated at cost, net of accumulated depreciation and amortization. The cost of property and equipment is depreciated or amortized on the straight-line method over the following estimated useful lives: Computer equipment 2 years Office furniture and equipment 5 years Lab equipment 5 years Leasehold improvements Lesser of the remaining economic life of the asset or the lease-term Expenditures for maintenance and repairs are charged to operations as incurred while renewals and betterments are capitalized. Gains and losses on disposals are included within operating expenses in the consolidated statements of operations. Management assesses the carrying value of property and equipment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If there is indication of impairment, management prepares an estimate of future undiscounted cash flows expected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the asset, an impairment loss is recognized to write down the asset to its estimated fair value. For the years ended December 31, 2019, 2018, and 2017, the Company did not Loss per Share Basic net loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the sum of the weighted average number of shares of common stock outstanding and the dilutive common stock equivalent shares outstanding during the period. The Company’s potentially dilutive common stock equivalent shares, which include incremental common shares issuable upon (i) the exercise of outstanding stock options and warrants (ii) vesting of restricted stock units and restricted stock awards, and (iii) conversion of preferred stock, are only included in the calculation of diluted net loss per share when their effect is dilutive. At December 31, 2019, 2018, and 2017, the following outstanding common stock equivalents have been excluded from the calculation of net loss per share because their impact would be anti-dilutive. As of December 31, 2019 2018 2017 Stock options 9,494,712 6,889,287 6,072,368 Warrants — — 6,301,216 Series A Convertible Preferred* 97,000 97,000 847,000 Series B Convertible Preferred* 3,581,119 5,854,845 7,378,241 Restricted stock units 22,916 68,742 114,582 13,195,747 12,909,874 20,713,407 *on an as-converted basis The dilutive effect of potentially dilutive securities would be reflected in diluted earnings per common share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of the Company's common stock could result in a greater dilutive effect from potentially dilutive securities. Fair Value Measurements Under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures, fair value is defined as the price at which an asset could be exchanged, or a liability transferred in a transaction between knowledgeable, willing parties in the principal or most advantageous market for the asset or liability. Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters. Where observable prices or parameters are not available, valuation models are applied. Assets and liabilities recorded at fair value in the Company’s financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities, are as follows: Level 1—These are investments where values are based on unadjusted quoted prices for identical assets in an active market that the Company has the ability to access. Level 2—These are investments where values are based on quoted market prices in markets that are not active or model derived valuations in which all significant inputs are observable in active markets The Company does not have fair valued assets classified under Level 2 Level 3—These are financial instruments where values are derived from techniques in which one or more significant inputs are unobservable. The Company does not have fair valued assets classified under Level 3 The Company’s financial instruments consist of cash and cash equivalents and short-term investments, all of which are reported at their respective fair value on its consolidated balance sheets. As of December 31, 2019 and 2018, financial assets measured at fair value on a recurring basis are categorized in the table below based upon the lowest level of significant input to the valuations (in thousands): Assets at Fair Value as of December 31, 2019 Level 1 Level 2 Level 3 Total US treasury securities $ 242,249 $ — $ — $ 242,249 US government agency securities 50,863 — — 50,863 Total $ 293,112 $ — $ — $ 293,112 Assets at Fair Value as of December 31, 2018 Level 1 Level 2 Level 3 Total US treasury securities $ 265,393 $ — $ — $ 265,393 US government agency securities 120,978 — — 120,978 Total $ 386,371 $ — $ — $ 386,371 Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include the assumptions made in valuing stock instruments issued for services and used in measuring operating right-of-use assets and operating lease liabilities, valuation of short-term investments, accounting for potential liabilities, and the valuation allowance associated with the Company’s deferred tax assets. Principles of Consolidation The accompanying consolidated financial statements include the accounts of Iovance Biotherapeutics, Inc. and its wholly-owned subsidiary, Iovance Biotherapeutics GmbH. All intercompany accounts and transactions have been eliminated. The U.S. dollar is the functional currency for all the Company's consolidated operations. Leases The Company determines if an arrangement includes a lease at inception. Operating leases are included in its consolidated balance sheet as Operating lease right-of-use assets and Operating lease liabilities as of December 31, 2019. Operating lease right-of-use assets represent the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the net present value of lease payments, the Company uses an estimated incremental borrowing rate that is applicable to the Company based on the information available at the later of the lease commencement date or the date of adoption of Accounting Standard Update (ASU) No. 2016-02 and ASU No. 2018-10, Leases (together “Topic 842”). The operating lease right-of-use assets also include any lease payments made less lease incentives. The Company’s leases may include options to extend or terminate the lease, which is considered in the lease term when it is reasonably certain that the Company will exercise any such options. Lease expense is recognized on a straight-line basis over the expected lease term. The Company has elected not to apply the recognition requirements of Topic 842 for short-term leases. For lease agreements entered into after the adoption of Topic 842 that include lease and non-lease components, such components are generally accounted for separately. Prior period amounts continue to be reported in accordance with the Company's historic accounting under previous lease guidance, Topic 840. See “Recently Adopted Accounting Standards - Leases” below, for more information about the impact of the adoption on Topic 842. Stock-Based Compensation The Company periodically grants stock options to employees in non-capital raising transactions as compensation for services rendered. The Company accounts for stock option grants to employees based on the authoritative guidance provided by the FASB where the value of the award is measured on the date of grant and recognized over the vesting period. Upon the adoption of ASU No. 2018-07, Compensation-Stock Compensation (“Topic 718”), the Company accounts for stock option grants to non-employees in a similar manner as stock option grants to employees except for the term used in the grant date fair value, therefore no longer requiring a re-measurement at the then-current fair values at each reporting date until the share options have vested. The nonemployee awards that contain a performance condition that affects the quantity or other terms of the award are measured based on the outcome that is probable. The fair value of the Company's common stock option grants is estimated using a Black-Scholes option pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the common stock options, and future dividends. The stock-based compensation expense is recorded based upon the value derived from the Black-Scholes option pricing model. The assumptions used in the Black-Scholes option pricing model could materially affect compensation expense recorded in future periods. The Company has in the past issued restricted stock units (RSU) and restricted stock awards (RSA) as part of its share-based compensation programs. The Company measures the compensation cost with respect to RSUs and RSAs issued to employees based upon the estimated fair value of the equity instruments at the date of the grant, which is recognized as an expense over the period during which an employee is required to provide services in exchange for the awards. The fair value of RSUs and RSAs is based on the closing price of the Company’s common stock on the grant date. Total stock-based compensation expense related to all of the Company’s stock-based awards was recorded on the consolidated statements of operations as follows (in thousands): Years Ended December 31, 2019 2018 2017 Research and development $ 11,396 $ 9,305 $ 5,270 General and administrative 12,881 10,722 6,698 Total stock-based compensation expense $ 24,277 $ 20,027 $ 11,968 Total stock-based compensation broken down based on each individual instrument was as follows (in thousands): Years Ended December 31, 2019 2018 2017 Stock option expense $ 23,964 $ 19,758 $ 10,862 Restricted stock award expense — — 34 Restricted stock unit expense 313 269 1,072 Total stock-based compensation expense $ 24,277 $ 20,027 $ 11,968 Research and Development Expenses Research and development expenses include personnel and facility-related expenses, outside contracted services including clinical trial costs, manufacturing and process development costs, research costs and other consulting services. Research and development costs are expensed as incurred. Nonrefundable advance payments for goods or services that will be used or rendered for future research and development activities are deferred and amortized over the period that the goods are delivered, or the related services are performed, subject to an assessment of recoverability. Clinical development costs are a significant component of research and development expenses. The Company has a history of contracting with third parties that perform various clinical trial activities on its behalf in connection with the ongoing development of its product candidates. The financial terms of these contracts are subject to negotiations and may vary from contract to contract and may result in uneven payment flow. The Company accrues and expenses costs for clinical trial activities performed by third parties based upon estimates of the percentage of work completed over the life of the individual trial in accordance with agreements established with contract research organizations and clinical trial sites. The Company determines its estimates through discussions with internal clinical personnel and outside service providers as to the progress or stage of completion of trials or services and the agreed upon fee to be paid for such services. General and Administrative Expenses General and administrative expenses consist primarily of salaries and other related costs, including stock-based compensation, for personnel in executive, finance, accounting, legal, investor relations, facilities, business development, marketing, commercial and human resources functions. Other significant costs include facility costs not otherwise included in research and development expenses, sublicense royalty expenses, legal fees relating to corporate matters, insurance, public company expenses relating to maintaining compliance with Nasdaq listing rules and Securities and Exchange Commission (“SEC”) requirements, investor relations costs, and fees for accounting and consulting services. General and administrative costs are expensed as incurred, and the Company accrues for services provided by third parties related to the above expenses by monitoring the status of services provided and receiving estimates from its service providers and adjusting its accruals as actual costs become known. Income Taxes The Company accounts for income taxes using the asset and liability method whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. ASC Topic 740-10-30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740-10-40 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company will classify as income tax expense any interest and penalties. The Company has no material uncertain tax positions for any of the reporting periods presented. Concentrations The Company is subject to credit risk from its portfolio of cash equivalents and short-term investments. Under its investment policy, it limits amounts invested in such securities by credit rating, maturity, industry group, investment type and issuer, except for securities issued by the U.S. government. The Company is not exposed to any significant concentrations of credit risk from these financial instruments. The goals of its investment policy, in order of priority, are as follows: safety and preservation of principal and diversification of risk; liquidity of investments sufficient to meet cash flow requirements; and a competitive after-tax rate of return. The Company maintains cash, cash equivalents and short-term investment balances at three financial institutions. At times, the amounts on deposit may exceed the federally insured limits. Management believes that the financial institutions which hold its cash are financially sound and, accordingly, minimal credit risk exists. As of December 31, 2019, and 2018, respectively, the Company’s cash balances were in excess of insured limits maintained at the financial institutions. Preferred Stock The Company applies the accounting standards for distinguishing liabilities from equity when determining the classification and measurement of its preferred stock. Preferred shares subject to mandatory redemption are classified as liability instruments and are measured at fair value. Conditionally redeemable preferred shares (including preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, preferred shares are classified as stockholders’ equity. Convertible Instruments The Company applies the accounting standards for derivatives and hedging and for distinguishing liabilities from equity when accounting for hybrid contracts that feature conversion options. The accounting standards require companies to bifurcate conversion options from their host instruments and account for them as free-standing derivative financial instruments according to certain criteria. The criteria include circumstances in which (i) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (ii) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (iii) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. The derivative is subsequently marked to market at each reporting date based on current fair value, with the changes in fair value reported in results of operations. Conversion options that contain variable settlement features such as provisions to adjust the conversion price upon subsequent issuances of equity or equity linked securities at exercise prices more favorable than that featured in the hybrid contract generally result in their bifurcation from the host instrument. The Company also records, when necessary, deemed dividends for the intrinsic value of the conversion options embedded in preferred stock based upon the difference between the fair value of the underlying common stock at the commitment date of the transaction and the effective conversion price embedded in the preferred stock. Recent Accounting Standards Leases On January 1, 2019, the Company adopted Topic 842, which establishes a new lease accounting method for lessees. The updated guidance requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. The Company elected the package of practical expedients requiring no reassessment of whether any expired or existing contracts are or contain leases, the lease classification of any expired or existing leases, or initial direct costs for any existing leases. The standard had a material impact on its consolidated balance sheets by recognizing Operating lease right-of-use assets and Operating lease liabilities for operating leases but did not have an impact on its consolidated statement of operations or cash flows. The adoption of Topic 842 resulted in recognition of Operating lease right-of-use assets of $10.4 million, $4.9 million of Operating lease liabilities - current, and $5.8 million of Operating lease liabilities - noncurrent as of January 1, 2019, the date of adoption. Improvements to Nonemployee Share-Based Payment Accounting On January 1, 2019, the Company adopted Topic 718, which eliminates the separate accounting method for nonemployee share-based payment awards and requires companies to account for share-based payment transactions with nonemployees in the same manner as share-based payment transactions with employees except for the term used in the grant date fair value. Under the new guidance, nonemployee share-based payment transactions are measured at the grant-date fair value and are no longer remeasured at the then-current fair values at each reporting date until the share options have vested. The guidance requires a modified-retrospective approach in transition. The Company compared the cumulative amounts that were recorded for its nonemployee share-based payments through December 31, 2018 immediately preceding the date of adoption to the cumulative amounts that should be recognized at the adoption date and recognized a cumulative effect of the transition adjustment of $0.3 million to retained earnings as of the date of adoption, January 1, 2019. Fair Value Measurements Disclosure In August 2018, the FASB issued ASU No. 2018-13 Fair Value Measurement (Topic 820): Disclosure Framework- Changes to the Disclosure Requirements for Fair Value Measurement, which eliminates disclosure requirement regarding transfers between level 1 and level 2 of the fair value of hierarchy, however, adds disclosure requirements on the range and weighted average used to develop significant unobservable inputs for level 3 fair value measurements. The Company adopted the guidance on January 1, 2019, however, there was no adjustment required to its disclosures as it did not have fair value assets classified under level 2 or 3 as of December 31, 2019 and 2018. Financial Instruments In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses, and also issued subsequent amendments to the initial guidance, ASU 2018-19, ASU 2019-04, ASU 2019-05, and ASU 2019-11 (collectively, Topic 326), to introduce a new impairment model for recognizing credit losses on financial instruments based on an estimate of current expected credit losses (CECL). Under Topic 326, an entity is required to estimate CECL on available-for-sale (AFS) debt securities only when the fair value is below the amortized cost of the asset and is no longer based on an impairment being “other-than-temporary”. Topic 326 also requires the impairment calculation on an individual security level and requires an entity use present value of cash flows when estimating the CECL. The credit-related losses are required to be recognized through earnings and non-credit related losses are reported in other comprehensive income. In April 2019, the FASB further clarified the scope of Topic 326 and addressed issues related to accrued interest receivable balances, recoveries, variable interest rates and prepayment. Topic 326 will be effective for public entities in fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The new guidance will require modified retrospective application to all outstanding instruments, with a cumulative effect adjustment recorded to opening retained earnings as of the beginning of the first period in which the guidance becomes effective. The Company will adopt this guidance on January 1, 2020, however, the Company does not believe the adoption of this new guidance will have any material impact on its consolidated financial statements. Cloud Computing Arrangements In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (ASU 2018-15), to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement (hosting arrangement) by providing guidance for determining when the arrangement includes a software license. The guidance provided generally means that an intangible asset is recognized for the software license and, to the extent that the payments attributable to the software license are made over time, a liability also is recognized. If a cloud computing arrangement does not include a software license, the entity should account for the arrangement as a service contract. This generally means that the fees associated with the hosting element (service) of the arrangement are expensed as incurred. ASU 2018-15 is effective for fiscal years beginning subsequent to December 15, 2019. The Company plans to adopt this guidance on January 1, 2020, and believes it will have a material impact on its consolidated balance sheets and statements of operations during 2020 by deferring recognition of costs as it prepares to invest in information technology infrastructure for its commercial manufacturing build-out. Segment reporting The Company operates in one segment, focused on developing and commercializing ACT using autologous TIL for the treatment of metastatic melanoma and other solid cancers. Subsequent Events Management of the Company evaluates events that have occurred after the balance sheet date through the date the financial statements are issued. Based upon the review, the Company identified the following subsequent events. Research collaboration and exclusive worldwide license agreement On January 12, 2020, the Company announced that it had entered into a research collaboration and exclusive worldwide license agreement whereby the Company will license gene-editing technology from Cellectis S.A. (“Cellectis”), a clinical-stage biopharmaceutical company, in order to develop TIL therapies that have been genetically edited. Financial terms of the license include development, regulatory and sales milestone payments from the Company to Cellectis, as well as royalty payments based on net sales of TALEN-modified TIL products. On January 12, 2020, the Company announced that it had obtained a license from Novartis Pharma AG (“Novartis”) to develop and commercialize an antibody cytokine engrafted protein, referred to as IOV-3001. Under the agreement, Iovance has paid an upfront payment to Novartis and may pay future milestones related to initiation of patent dosing in various phases of clinical development for IOV-3001 and approval of the product in the U.S, EU and Japan. Novartis is also entitled to low-to-mid single digit royalties from commercial sales of the product. |
CASH AND CASH EQUIVALENTS, AND
CASH AND CASH EQUIVALENTS, AND SHORT-TERM INVESTMENTS | 12 Months Ended |
Dec. 31, 2019 | |
CASH AND CASH EQUIVALENTS, AND SHORT-TERM INVESTMENTS | |
CASH AND CASH EQUIVALENTS, AND SHORT-TERM INVESTMENTS | NOTE 3. CASH AND CASH EQUIVALENTS, AND SHORT-TERM INVESTMENTS Cash equivalents, and short-term investments consist of the following (in thousands): December 31, December 31, 2019 2018 Cash equivalents - Money market funds $ 10,049 $ 25,968 Cash equivalents total $ 10,049 $ 25,968 Cash equivalents in the tables above exclude cash demand deposits of $3.9 million and $56.2 million as of December 31, 2019 and 2018, respectively (in thousands). December 31, December 31, Short-term Investments 2019 2018 US treasury securities $ 242,249 $ 265,393 US government agency securities 50,863 120,978 Short-term investments total $ 293,112 $ 386,371 The cost and fair value of cash equivalents and short-term investments at December 31, 2018 and 2019 were as follows (in thousands): Gross Gross Unrealized Unrealized As of December 31, 2019 Cost Accretion Gains Losses Fair Value US treasury securities $ 241,709 $ 364 $ 179 $ (3) $ 242,249 US government agency securities 50,712 107 44 — 50,863 Total $ 292,421 $ 471 $ 223 $ (3) $ 293,112 Gross Gross Unrealized Unrealized As of December 31, 2018 Cost Accretion Gains Losses Fair Value US treasury securities $ 264,619 $ 813 $ 19 $ (58) $ 265,393 US government agency securities 120,653 328 21 (24) 120,978 Total $ 385,272 $ 1,141 $ 40 $ (82) $ 386,371 Unrealized gains and losses are included in accumulated other comprehensive loss. All short-term investments held by the Company as of December 31, 2019 and 2018 have a maturity of less than one year. |
BALANCE SHEET COMPONENTS
BALANCE SHEET COMPONENTS | 12 Months Ended |
Dec. 31, 2019 | |
BALANCE SHEET COMPONENTS | |
BALANCE SHEET COMPONENTS | NOTE 4. BALANCE SHEET COMPONENTS Property and equipment, net consists of the following (in thousands): December 31, December 31, 2019 2018 Lab equipment $ 4,530 $ 4,160 Leasehold improvements 2,372 1,776 Computer equipment 258 337 Office furniture and equipment 457 263 Construction in progress 5,417 107 Total Property and equipment, cost 13,034 6,643 Less: Accumulated depreciation and amortization (4,498) (3,960) property and equipment, net $ 8,536 $ 2,683 Depreciation expense for the years ended December 31, 2019, 2018 and 2017 was approximately $1.2 million, $1.0 million and $1.0 million, respectively. Accrued liabilities consist of the following (in thousands): December 31, December 31, 2019 2018 Accrued payroll and employee related expenses $ 6,866 $ 4,113 Legal and related services 866 825 Clinical related 4,692 3,424 Manufacturing related 2,184 2,684 Deferred rent - current — 124 Accrued other 1,657 489 $ 16,265 $ 11,659 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2019 | |
STOCKHOLDERS' EQUITY | |
STOCKHOLDERS' EQUITY | NOTE 5. STOCKHOLDERS’ EQUITY Public Offerings In January 2018, the Company closed an underwritten public offering of 15,000,000 shares of the Company’s common stock at a public offering price of $11.50 per share, before underwriting discounts, which included 1,956,521 shares issued upon the exercise in full by the underwriter of its option to purchase additional shares at the public offering price less the underwriting discount. The gross proceeds from the offering, before deducting the underwriting discounts and commissions and other offering expenses payable by the Company, were $172.5 million, with net proceeds to the Company of $162.0 million. On October 17, 2018, the Company completed an underwritten public offering of 25,300,000 shares of the Company’s common stock at a public offering price of $9.97 per share, before underwriting discounts, which included 3,300,000 shares issued upon the exercise in full by the underwriter of its option to purchase additional shares at the public offering price less the underwriting discount. The gross proceeds from the offering, before deducting the underwriting discounts and commissions and other estimated offering expenses payable by the Company, were $252.2 million, with net proceeds to the Company of $236.7 million. On June 10, 2019, the certificate of incorporation of the Company was amended to increase the number of authorized shares of the Company’s common stock, par value $0.000041666, from 150,000,000 shares to 300,000,000 shares (the “Certificate of Amendment”). The Certificate of Amendment was approved by the Company’s stockholders at the Company’s 2019 Annual Meeting of Stockholders held on June 10, 2019. Preferred Stock The Company’s certificate of incorporation authorizes the issuance of up to 50,000,000 shares of “blank check” preferred stock. At December 31, 2019, 17,000 shares were designated as Series A Convertible Preferred Stock and 11,500,000 shares were designated as Series B Convertible Preferred Stock (“Series B Convertible Preferred Stock”). Series A Convertible Preferred Stock A total of 17,000 shares of Series A Convertible Preferred Stock have been authorized for issuance under the Company’s Certificate of Designation of Preferences and Rights of Series A Convertible Preferred Stock. The shares of Series A Convertible Preferred Stock have a stated value of $1,000 per share and are initially convertible into shares of common stock at a price of $2.00 per share, subject to adjustment. The Series A Convertible Preferred Stock may, at the option of each investor, be converted into fully paid and non-assessable shares of common stock. The holders of shares of Series A Convertible Preferred Stock do not have the right to vote on matters that come before the Company’s stockholders. In the event of any dissolution or winding up of the Company, proceeds shall be paid pari passu among the holders of common stock and preferred stock, pro rata based on the number of shares held by each holder. The Company may not declare, pay or set aside any dividends on shares of capital stock of the Company (other than dividends on shares of common stock payable in shares of common stock) unless the holders of the Series A Convertible Preferred Stock shall first receive an equal dividend on each outstanding share of Series A Convertible Preferred Stock. The common shares issued were determined on a formula basis of 500 common shares for each share of Series A Convertible Preferred Stock converted. No Shares of Series A Convertible Preferred Stock were converted during the year ended December 31, 2019. A total of 1,500 shares of Series A Convertible Preferred Stock were converted into 750,000 shares of common stock during the year ended December 31, 2018. At December 31, 2019 and 2018, 194 shares of Series A Convertible Preferred Stock (that are convertible into 97,000 shares of common stock) remained outstanding. Series B Convertible Preferred Stock A total of 11,500,000 shares of Series B Convertible Preferred Stock are authorized for issuance under the Company’s Series B Certificate of Designation of Rights, Preferences and Privileges of Series B Convertible Preferred Stock. The shares of Series B Convertible Preferred Stock have a stated value of $4.75 per share and are convertible into shares of the Company’s common stock at an initial conversion price of $4.75 per share. Holders of Series B Convertible Preferred Stock are entitled to dividends on an as-if-converted basis in the same form as any dividends actually paid on shares of the Series A Convertible Preferred Stock or the Company’s common stock. So long as any Series B Convertible Preferred Stock remains outstanding, the Company may not redeem, purchase or otherwise acquire any material amount of the Series A Convertible Preferred Stock or any securities junior to the Series B Convertible Preferred Stock. A total of 2,273,726 shares of Series B Convertible Preferred Stock were converted into 2,273,726 shares of common stock during the year ended December 31, 2019. A total of 1,523,396 shares of Series B Convertible Preferred Stock were converted into 1,523,396 shares of common stock during the year ended December 31, 2018. At December 31, 2019 and 2018, 3,581,119 and 5,854,845 shares of Series B Preferred Stock (that are convertible into 3,581,119 and 5,854,845 shares of common stock) remained outstanding, respectively. Cancellation of Common Shares On September 30, 2013, the Company and a third party entered into an agreement under which the Company issued 50,000 shares of unregistered stock in the Company to the third party. On January 16, 2019, the two parties entered into a confidential settlement agreement in connection with a dispute related to their prior relationship and activities. As part of the settlement, the third party returned 32,500 shares of common stock to the Company for cancellation and retained the remaining 17,500 shares. The Company included a gain of $335,000 on cancellation of 32,500 shares in Other income in its consolidated statement of operations. Warrants There were no remaining outstanding warrants as of December 31, 2019 and 2018. A summary of the changes of stock warrants is presented in the following table. Weighted Weighted Aggregate Shares Average Average Intrinsic Under Exercise Remaining Value Warrants Price Life (in thousands) Outstanding at January 1, 2017 6,566,216 $ 2.51 Issued — — Exercised (265,000) 2.50 Expired/Cancelled — — Outstanding at December 31, 2017 6,301,216 $ 2.51 Issued — — Exercised (6,301,216) 2.51 Expired/Cancelled — — Outstanding at December 31, 2018 — $ — — $ — Outstanding at December 31, 2019 — $ — — $ — |
STOCK BASED COMPENSATION
STOCK BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2019 | |
STOCK BASED COMPENSATION | |
STOCK BASED COMPENSATION | NOTE 6. STOCK BASED COMPENSATION Stock Plans On October 14, 2011, the Company adopted the 2011 Equity Incentive Plan (the “2011 Plan”). Employees, directors, consultants and advisors of the Company are eligible to participate in the 2011 Plan. The 2011 Plan initially had 180,000 shares of common stock reserved for issuance in the form of incentive stock options, non-qualified options, common stock, and grant appreciation rights. The 2011 Plan was not approved by the Company’s stockholders within the required one-year period following its adoption and, accordingly, no incentive stock options can be granted under that plan. In August 2013, the Company’s Board of Directors and a majority of the Company’s stockholders approved an amendment to increase the number of shares available under the 2011 Plan from 180,000 shares to 1,700,000 shares, and an amendment to increase the number options or other awards that can be granted to any one person during a twelve (12) month period from 50,000 shares to 300,000 shares. The foregoing amendment to the 2011 Plan became effective in September 2013. On August 20, 2014, the Company’s Board of Directors amended the 2011 Plan to increase the number of shares available for issuance upon the exercise of stock options under the 2011 Plan from 1,700,000 to 1,900,000 shares, effective immediately. At December 31, 2019, 151,240 shares were available for future grant under the 2011 Plan. On September 19, 2014, the Company’s Board of Directors adopted the Iovance Biotherapeutics, Inc. 2014 Equity Incentive Plan (the “2014 Plan”). The 2014 Plan was approved by the Company’s stockholders at the Company’s 2014 Annual Meeting of Stockholders held in November 2014. The 2014 Plan, as approved by the stockholders, authorized the issuance up to an aggregate of 2,350,000 shares of the Company’s common stock. On April 10, 2015, the Board amended the 2014 Plan to increase the total number of shares that can be issued under the 2014 Plan to 4,000,000 shares of the Company’s common stock. The increase in shares available for issuance under the 2014 Plan was approved by the Company’s stockholders at the Company’s 2015 Annual Meeting of Stockholders in June 2015. On August 16, 2016, the Company’s stockholders approved an increase in the total number of shares that can be issued under the 2014 Plan to 9,000,000 shares of the Company’s common stock. At December 31, 2019, 174,292 shares were available for grant under the Company’s 2014 Plan. On April 22, 2018, the Board of Directors adopted the Iovance Biotherapeutics, Inc. 2018 Equity Incentive Plan (the “2018 Plan”). The 2018 Plan was approved by the Company’s stockholders at the annual meeting of stockholders held in June 2018. The 2018 Plan as approved by the stockholders authorized the issuance up to an aggregate of 6,000,000 shares of common stock reserved for issuance in the form of incentive (qualified) stock options, non-qualified options, common stock, stock appreciation rights, restricted stock awards, restricted stock units, other stock-based awards, other cash-based awards or any combination of the foregoing. At December 31, 2019, 3,297,600 shares of common stock were available for grant under the Company’s 2018 Plan. Restricted Stock Units On June 1, 2016, the Company entered into a restricted stock unit agreement with the Company’s new Chief Executive Officer, Maria Fardis, Ph.D., pursuant to which the Company granted Dr. Fardis 550,000 non-transferrable restricted stock units at fair market value of $5.87 per share as an inducement of employment pursuant to the exception to The Nasdaq Global Market rules that generally require stockholder approval of equity incentive plans. The 550,000 restricted stock units vest in installments as follows: (i) 137,500 restricted stock units vested upon the first anniversary of the effective date of Dr. Fardis’ employment agreement; (ii) 275,000 restricted stock units vest upon the satisfaction of certain clinical trial milestones; and (iii) 137,500 restricted stock units vest in equal monthly installments over the 36 -month period following the first anniversary of the effective date of Dr. Fardis’ employment, provided that Dr. Fardis has been continuously employed with the Company as of such vesting dates. At December 31, 2019, 22,916 restricted stock units remained unvested. Stock-based compensation expense for restricted stock units are measured based on the closing fair market value of the Company's common stock on the date of grant. The stock-based compensation expenses relating to restricted stock units were $0.3 million, $0.3 million, and $1.1 million for the years ended December 31, 2019, 2018, and 2017, respectively, recorded as part of general and administrative expenses. As of December 31, 2019, $0.1 million of total unrecognized compensation costs related to non-vested restricted stock units to be recognized over a weighted average period of 0.42 years. Stock Options A summary of the status of stock options at December 31, 2019, and the changes during the three years then ended, is presented in the following table: Weighted Weighted Average Aggregate Number Average Remaining Intrinsic of Exercise Contractual Value Options Price Life (in thousands) Outstanding at January 1, 2017 6,233,150 $ 7.24 Issued 2,188,800 6.68 Exercised (1,011,284) 5.55 Expired/Cancelled (1,338,298) 6.79 Outstanding at December 31, 2017 6,072,368 $ 7.42 Issued 2,960,620 14.73 Exercised (1,336,514) 7.45 Expired/Cancelled (807,187) 10.04 Outstanding at December 31, 2018 6,889,287 $ 10.25 Issued 4,166,600 14.73 Exercised (727,492) 8.85 Expired/Cancelled (833,683) 13.87 Outstanding at December 31, 2019 9,494,712 $ 12.00 8.05 years $ 149,493 Exercisable at December 31, 2019 4,548,959 $ 9.61 6.95 years $ 82,864 The Company recorded stock-based compensation expenses related to stock options of $24.0 million, $19.8 million, and $10.9 million for the years ended December 31, 2019, 2018, and 2017, respectively. As of December 31, 2019, there was $41.2 million of total unrecognized compensation expenses related to non-vested employee options to be recognized over a weighted average period of 1.97 years. The weighted average grant date fair value for employee options granted under the Company's stock option plans during the years ended December 31, 2019, 2018, and 2017 was $9.48, $14.44, and $6.58 per option respectively. The aggregate intrinsic value in the table above reflects the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the year ended December 31, 2019 and the exercise price of the options, multiplied by the number of in-the-money stock options) that would have been received by the option holders had all option holders exercised their options on December 31, 2019. The intrinsic value of the Company’s stock options changes based on the closing price of the Company’s common stock. The total pre-tax intrinsic value of stock options exercised during the year ended December 31, 2019, 2018, and 2017 were $5.3 million, $2.3 million, and $2.6 million, respectively. The following table summarizes the assumptions relating to options granted pursuant to the Company’s equity incentive plans for the years ended December 31, 2019, 2018, and 2017: Years Ended December 31, 2019 2018 2017 Expected dividend yield 0% 0% 0% Risk-free interest rate 2.59% - 1.62% 2.97% - 2.27% 2.34% - 1.72% Expected term (in years) 6.14 6.06 6.50 5.13 6.50 5.13 Expected volatility 71.62% - 70.63% 200.28% - 167.54% 209.69% - 190.46% Expected Dividend Yield —The Company has never paid dividends and does not expect to pay dividends in the foreseeable future. Risk-Free Interest Rate —The risk-free interest rate was based on the market yield currently available on United States Treasury securities with maturities approximately equal to the option’s expected term. Expected Term —The expected term of the stock option grants was calculated based on historical exercises, cancellations, and forfeitures of stock options and outstanding option shares Expected Volatility —The expected volatility is based on the historical volatility for the Company's stock over a period equal to the expected terms of the options. Forfeiture Rate —The Company recognizes forfeitures as they occur. Each of the inputs discussed above is subjective and generally requires significant management judgment. A summary of outstanding and exercisable stock options as of December 31, 2019 is as follows: Options Outstanding Options Exercisable Weighted Weighted Average Weighted Average Weighted Remaining Average Remaining Average Range of Exercise Number of Contractual Exercise Price Number of Contractual Exercise Price Prices Shares Life Per Share Shares Life Per Share $5.05 - $5.87 1,086,300 6.71 $ 5.56 945,048 6.65 $ 5.56 $5.88 - $7.55 1,413,645 6.57 7.25 1,329,098 6.51 7.28 $7.56 - $9.10 970,107 6.87 8.44 830,055 6.60 8.45 $9.11 - $10.69 962,900 8.69 9.70 248,689 7.60 9.44 $10.70 - $11.15 118,950 6.43 11.06 88,750 5.45 11.05 $11.16 - $11.26 1,574,900 9.17 11.26 — — — $11.27 - $16.50 1,283,110 8.22 14.93 719,738 7.95 15.23 $16.51 - $19.75 1,046,000 8.69 17.62 378,581 8.12 17.33 $19.76 - $25.78 994,800 9.66 21.79 — — — $25.79 - 117.00 44,000 8.28 42.15 9,000 1.73 99.12 9,494,712 8.05 $ 12.00 4,548,959 6.95 $ 9.61 Restricted Common Stock Awards There were no unvested restricted common stock awards as of December 31, 2019, 2018, and 2017. During the year ended December 31, 2019, 2018 and 2017, no expense was recognized in connection with these awards. |
EMPLOYEE BENEFIT PLAN
EMPLOYEE BENEFIT PLAN | 12 Months Ended |
Dec. 31, 2019 | |
EMPLOYEE BENEFIT PLAN | |
EMPLOYEE BENEFIT PLAN | NOTE.7 EMPLOYEE BENEFIT PLAN The Company maintains a defined contribution plan covering substantially all U.S. employees under Section 401(k) of the Internal Revenue Code of 1986, as amended (the “IRC”). The Company's matching contribution to the plan was $0.9 million, 0.5 million, and $0.3 million for the years ended December 31, 2019, 2018, and 2017, respectively. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2019 | |
INCOME TAXES | |
INCOME TAXES | NOTE 8. INCOME TAXES Net deferred tax assets (liabilities) are summarized as follows (in thousands): As of December 31, 2019 2018 Deferred income tax asset: Net operating loss carry forward $ 95,473 $ 56,971 Stock-based compensation 8,851 5,823 Tax credit carry forwards 22,711 14,356 Lease liabilities 2,529 Depreciation and amortization 98 Reserves and accruals 1,410 1,049 Deferred tax assets before valuation allowance 131,072 78,199 Less: valuation allowance (128,720) (78,146) Net deferred income tax assets 2,352 53 Deferred tax liabilities: Depreciation and amortization (2,352) (53) Net deferred tax assets (liabilities) $ — $ — Reconciliation of the effective income tax rate to the U.S. statutory rate is as follows: Years ended December 31, 2019 2018 2017 Federal statutory tax rate (21) % (21) % (34) % Orphan Drug & Research credits (4) (3) — Permanent and other differences 1 1 4 Tax rate change — — 23 State tax, net of federal benefit (2) (1) — (26) % (24) % (7) % Valuation allowance 26 % 24 % 7 % Effective tax rate — % — % — % The components of income tax expense (benefit) are as follows (in thousands): Years Ended December 31, 2019 2018 2017 Federal: Current $ — $ — $ — Deferred (47,010) (28,277) (7,391) State and Local Current — — — Deferred (3,564) (2,020) 944 Change in Valuation Allowance 50,574 30,297 6,447 Total income tax expense (benefit) $ — $ — $ — The Company had net operating loss carryovers (“NOLs”) for federal and state income tax purposes of approximately $426.8 million and $128.5 million, respectively, as of December 31, 2019. $142.4 million of federal NOLs will expire beginning in 2027, while $284.4 million generated after Tax Reform will have an indefinite life. The state NOLs will expire if unused in years 2031 through 2038. The Company’s utilization of NOLs is subject to an annual limitation due to ownership changes that have occurred previously or that could occur in the future as provided in Section 382 of the IRC (“Section 382”), as well as similar state provisions. Section 382 limits the utilization of NOLs when there is a greater than 50% change of ownership as determined under the regulations. Since its formation, the Company has raised capital through the issuance of capital stock and various convertible instruments which, combined with the purchasing shareholders’ subsequent disposition of these shares, has resulted in an ownership change as defined by Section 382, and could result in an ownership change in the future upon subsequent disposition. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon future generation for taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the years ended December 31, 2019, 2018, and 2017, the change in the valuation allowance was approximately $50.6 million, $30.3 million, and 6.4 million respectively. The Company evaluated the provisions of ASC 740 related to the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. ASC 740 prescribes a comprehensive model for how a company should recognize, present, and disclose uncertain positions that the Company has taken or expects to take in its tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. Differences between tax positions taken or expected to be taken in a tax return and the net benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits.” A liability is recognized (or amount of net operating loss carry forward or amount of tax refundable is reduced) for unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC 740. If applicable, interest costs related to the unrecognized tax benefits are required to be calculated and would be classified as income tax expenses in the consolidated statement of operations. Penalties would be recognized as a component of “General and Administrative Expenses” in the consolidated statement of operations. A reconciliation of the beginning and ending balances of the unrecognized tax benefits during the years ended December 31, 2019, 2018, and 2017 is as follows (in thousands): Years Ended December 31, 2019 2018 2017 Unrecognized benefit - beginning of period $ 6,344 $ 4,111 $ — Gross decreases - prior period tax positions — 118 2,780 Gross increase current period tax positions 3,694 2,115 1,331 Unrecognized benefit - end of period $ 10,038 $ 6,344 $ 4,111 No interest or penalties on unpaid tax were recorded during the years ended December 31, 2019, 2018, and 2017, respectively. The Company does not anticipate any significant changes within 12 months of this reporting date of its uncertain tax positions. The Company files tax returns in the U.S. federal and state jurisdictions. The U.S. federal and U.S. state taxing authorities may choose to audit tax returns for tax years beyond the statute of limitation period due to significant tax attribute carryforwards from prior years, making adjustments only to carryforward attributes. The Company is not currently under examination by income tax authorities in federal, state or other foreign jurisdictions. |
LICENSES AND AGREEMENTS
LICENSES AND AGREEMENTS | 12 Months Ended |
Dec. 31, 2019 | |
LICENSES AND AGREEMENTS | |
LICENSES AND AGREEMENTS | NOTE 9. LICENSES AND AGREEMENTS National Institutes of Health (NIH) and the National Cancer Institute (NCI) Cooperative Research and Development Agreement (CRADA) In August 2011, the Company signed a five-year CRADA with the NCI to work with Dr. Steven Rosenberg on developing adoptive cell immunotherapies that are designed to destroy metastatic melanoma cells using a patient’s tumor infiltrating lymphocytes. In January 2015, the Company executed an amendment to the CRADA to include four new indications. As amended, in addition to metastatic melanoma, the CRADA included the development of TIL therapy for the treatment of patients with bladder, lung, triple-negative breast, and Human Papilloma Virus (“HPV”)-associated cancers. In August 2016, the NCI and the Company entered a second amendment to the CRADA. The principal changes effected by the second amendment included (i) extending the term of the CRADA by another five years to August 2021, and (ii) modifying the focus on the development of unmodified TIL as a stand-alone therapy or in combination with U.S. Food and Drug Administration (“FDA”) - licensed products and commercially available reagents routinely used for adoptive cell therapy. The parties will continue the development of improved methods for the generation and selection of TIL with anti-tumor reactivity in metastatic melanoma, bladder, lung, breast, and HPV-associated cancers. Pursuant to the terms of the CRADA, as amended, the Company is required to make quarterly payments of $0.5 million to the NCI for support of research activities. To the extent the Company licenses patent rights relating to a TIL-based product candidate, the Company will be responsible for all patent-related expenses and fees, past and future, relating to the TIL-based product candidate. In addition, the Company may be required to supply certain test articles, including TIL, grown and processed under cGMP conditions, suitable for use in clinical trials, where the Company holds the investigational new drug application for such clinical trial. The extended CRADA has a five-year term expiring in August 2021. The Company or the NCI may unilaterally terminate the CRADA for any reason or for no reason at any time by providing written notice at least 60 days before the desired termination date. The Company recorded costs associated with the CRADA of $2.2 million, $2.0 million, and 2.0 million for the years ended December 31, 2019, 2018 and 2017, respectively, as research and development expenses. Patent License Agreement Related to the Development and Manufacture of TIL Effective October 5, 2011, the Company entered into an Exclusive Patent License Agreement (the “Patent License Agreement”) with the NIH, an agency of the United States Public Health Service within the Department of Health and Human Services (NIH), which was subsequently amended on February 9, 2015 and October 2, 2015. Pursuant to the Patent License Agreement, as amended, the NIH granted the Company licenses, including exclusive, co-exclusive, and non-exclusive licenses, to certain technologies relating to autologous tumor infiltrating lymphocyte adoptive cell therapy products for the treatment of metastatic melanoma, lung, breast, bladder and HPV-positive cancers. The Patent License Agreement requires the Company to pay royalties based on a percentage of net sales (which percentage is in the mid-single digits), a percentage of revenues from sublicensing arrangements, and lump sum benchmark royalty payments on the achievement of certain clinical and regulatory milestones for each of the various indications and other direct costs incurred by the NIH pursuant to the agreement. Exclusive Patent License Agreement Related to TIL Selection On February 10, 2015, the Company entered into an exclusive patent license agreement (the “Exclusive Patent License Agreement”) with the NIH under which the Company received an exclusive license to the NIH’s rights to patent-pending technologies related to methods for improving adoptive cell therapy through more potent and efficient production of TIL from melanoma tumors by selecting for T cell populations that express various inhibitory receptors. Unless terminated sooner, the license shall remain in effect until the last licensed patent right expires. Under the Exclusive Patent License Agreement, the Company agreed to pay customary royalties based on a percentage of net sales of a licensed product (which percentage is in the mid-single digits), a percentage of revenues from sublicensing arrangements, and lump sum benchmark payments upon the successful completion of clinical studies involving licensed technologies, the receipt of the first FDA approval or foreign equivalent for a licensed product or process resulting from the licensed technologies, the first commercial sale of a licensed product or process in the United States, and the first commercial sale of a licensed product or process in any foreign country. H. Lee Moffitt Cancer Center Research Collaboration and Clinical Grant Agreements with Moffitt In December 2016, the Company entered into a new three-year Sponsored Research Agreement with H. Lee Moffitt Cancer Center (“Moffitt”). At the same time, the Company entered into a clinical grant agreement with Moffitt to support an ongoing clinical trial at Moffitt that combines TIL therapy with nivolumab for the treatment of patients with metastatic melanoma. In June 2017, the Company entered into a second clinical grant agreement with Moffitt to support a new clinical trial at Moffitt that combines TIL therapy with nivolumab for the treatment of patients with non-small cell lung cancer, under which the Company obtained a non-exclusive, royalty-free license to any new Moffitt inventions made in the performance of the agreement. Under both clinical grant agreements with Moffit, the Company has non-exclusive rights to clinical data arising from the respective clinical trials. In the years ended December 31, 2019, 2018 and 2017, the Company recorded research and development costs of $0.7 million, $1.2 million, and $1.2 million, respectively, in connection with the research collaboration and clinical grant agreements with Moffitt. Exclusive License Agreements with Moffitt The Company entered into a license agreement with Moffitt (the “First Moffitt License”), effective as of June 28, 2014, under which the Company received a world-wide license to Moffitt’s rights to patent-pending technologies related to methods for improving TIL for adoptive cell therapy using toll-like receptor agonists. Unless earlier terminated, the term of the license extends until the earlier of the expiration of the last issued patent related to the licensed technology or 20 years after the effective date of the license agreement. Pursuant to the First Moffitt License, the Company paid an upfront licensing fee in the amount of $0.1 million. A patent issuance fee will also be payable under the First Moffitt License, upon the issuance of the first U.S. patent covering the subject technology. In addition, the Company agreed to pay milestone license fees upon completion of specified milestones, customary royalties based on a specified percentage of net sales (which percentage is in the low single digits) and sublicensing payments, as applicable, and annual minimum royalties beginning with the first sale of products based on the licensed technologies, which minimum royalties will be credited against the percentage royalty payments otherwise payable in that year. The Company will also be responsible for all costs associated with the preparation, filing, maintenance and prosecution of the patent applications and patents covered by the First Moffitt License related to the treatment of any cancers in the United States, Europe and Japan and in other countries designated by the Company in agreement with Moffitt. The Company entered into a license agreement with Moffitt effective as of May 7, 2018 (the “Second Moffitt License”), under which the Company received a license to Moffitt’s rights to patent-pending technologies related to the use of 4-1BB agonists in conjunction with TIL manufacturing processes and therapies. Pursuant to the Second Moffitt License, the Company paid an upfront licensing fee in the amount of $0.1 million for the year ended December 31, 2018. An annual license maintenance fee is also payable commencing on the first anniversary of the effective date. In addition, the Company agreed to pay an annual commercial use payment for each indication for which a first sale has occurred, which in the aggregate amounts to up to $0.4 million a year. The Company recorded $0.1 million for the years ended December 31, 2019 and 2018 as research and development expenses in connection with this agreement. M.D. Anderson Cancer Center Strategic Alliance Agreement On April 17, 2017, the Company entered into a Strategic Alliance Agreement (the “SAA”) with M.D. Anderson Cancer Center (“MDACC”) under which the Company and MDACC agreed to conduct clinical and preclinical research studies. The Company agreed in the SAA to provide total funding not to exceed approximately $14.2 million for the performance of the multi-year studies under the SAA. In return, the Company acquired all rights to inventions resulting from the studies and has been granted a non-exclusive, sub-licensable, royalty-free, and perpetual license to specified background intellectual property of MDACC reasonably necessary to exploit, including the commercialization thereof. The Company has also been granted certain rights in clinical data generated by MDACC outside of the clinical trials to be performed under the SAA. The SAA’s term shall continue in effect until the later of the fourth anniversary of the SAA or the completion or termination of the research and receipt by the Company of all deliverables due from MDACC thereunder. In May 2017, the Company made a prepayment of $1.4 million under this agreement. The Company recorded $3.4 million and $0.8 million associated with the SAA for the year ended December 31, 2019 and 2018 as research and development expenses, respectively. No expense was recognized in 2017. MedImmune In December 2015, the Company entered into a collaboration agreement (the “MedImmune Agreement”) with MedImmune, the global biologics research and development arm of AstraZeneca (“MedImmune”), to conduct clinical and preclinical research immuno-oncology. Under the MedImmune Agreement, the Company funded and sought to conduct at least one clinical trial combining MedImmune's PD-L1 inhibitor, durvalumab, with TIL for the treatment of patients. MedImmune will supply durvalumab for the clinical trials. On April 3, 2019, the Company and MedImmune announced that the study was closed because of a changing treatment landscape and a lack of enrollment, and the collaboration agreement was terminated as of April 1, 2019. WuXi In November 2016, the Company entered into a three-year manufacturing and services agreement (“MSA”) with WuXi AppTech, Inc. (“WuXi”) pursuant to which WuXi agreed to provide manufacturing and other services. Under the agreement, the Company entered into two statements of work for two cGMP manufacturing suites to be established and operated by WuXi for the Company, both of the suites are expected to be capable of being used for the commercial manufacture of its products. The statements of work for each of the suites were amended in 2019. The statements of work for facility include a fixed component to reserve a dedicated suite and a trained work force, and a variable component, mainly materials and testing used during the manufacturing processes. Both statements of work provide for adjustments to the targeted production capacity levels and the corresponding fixed quarterly fees upon written notice from the Company of 30 days and 90 days for the first and second dedicated suites, respectively. The quarterly fixed fees payable for each of the dedicated manufacturing suites ranges from $1.2 million to $2.7 million depending on the production capacity level targeted. The terms of the related statements of work for the first and second dedicated manufacturing suites currently extend to May 2020 and June 2021, respectively. The Company recorded costs associated with agreements with WuXi of $28.4 million, $15.1 million, and $13.9 million for the years ended December 31, 2019, 2018, and 2017 respectively, as research and development expenses. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2019 | |
LEASES | |
LEASES | NOTE 10. LEASES As described further in "Note 2. Summary of Significant Accounting Policies", the Company adopted Topic 842 as of January 1, 2019. Prior period amounts have not been adjusted and continue to be reported in accordance with its historic accounting under ASU Topic 840- Leases (Topic 840). Facilities Leases The Company has evaluated the following existing facility leases and determined that, effective upon the adoption of Topic 842, they were all operating leases. Operating lease right-of-use assets and liabilities were recognized as of January 1, 2019 based on the present value of the remaining lease payments over the lease term. As the Company's leases do not provide an implicit rate, the Company utilized a third party in determining an incremental borrowing rate based on the information available as of the adoption date of Topic 842 to obtain the present value of lease payments. The Company's lease terms may include options to extend or terminate the lease which are included in the lease term when it is reasonably certain that it will exercise any such options. Lease expense is recognized on a straight-line basis over the expected lease term. The Company elected not to apply the recognition requirements of Topic 842 for short-term leases that have a lease term of 12 months or less. Tampa Lease In December 2014, the Company commenced a five-year non-cancellable operating lease with the University of South Florida Research Foundation for a 5,115 square foot facility located in Tampa, Florida. The facility is part of the University of South Florida research park and is used as the Company’s research and development facilities. The Company had the option to extend the lease term of this facility for an additional five-year period on the same terms and conditions, except that the base rent for the renewal term will be increased in accordance with the applicable consumer price index. In April 2015, the Company amended the original lease agreement to increase the rentable space to 6,043 square feet. In September 2016, the Company further increased the rentable space to 8,673 square feet. The per square foot cost and term of the lease were unchanged, and rent payments are approximately $20,000 per month. In December 2019, the Company entered into an agreement to extend the lease term to December 18, 2024 for approximately $20,500 a month. San Carlos Lease On August 4, 2016, the Company entered into an agreement to lease 8,733 square feet in San Carlos, California. The term of the lease is 54 months subsequent to the commencement date and will expire in April 2021. Monthly lease payments are approximately $38,000. On April 28, 2017, the Company entered into a sublease agreement with Teradata US, Inc., pursuant to which the Company agreed to sublease certain office space located adjacent to the Company's headquarters for approximately $26,000 per month. The space consists of approximately 11,449 rentable square feet in the building located in San Carlos, California. The sublease for this space expired on October 31, 2018. Monthly lease payments were approximately $26,000. On October 19, 2018, the Company entered into an agreement to lease 12,322 square feet of office space located adjacent to the Company's headquarters in San Carlos, California. This lease replaces the sublease of 11,449 square feet of office space in the same facility that expired on October 31, 2018. The term of the lease is 30 months subsequent to the commencement date, November 1, 2018, and will expire in April 2021. Monthly lease payments are approximately $59,000, subject to an annual increase of 3%. On June 19, 2019, the Company entered into a first amendment (the "Amended Lease") to its previously disclosed lease agreement with Hudson Skyway Landing, LLC (the "Lease") for additional space at its corporate headquarters in San Carlos, California. Under the Amended Lease, the Company will lease an additional 8,110 square feet (the "Expansion Space"), for a total of approximately 20,432 square feet of space on the first floor of the building located at 999 Skyway Road, San Carlos, California, commonly known as Skyway Landing II. The term of the Amended Lease remains the same as that of the Lease and expires on April 30, 2021, unless earlier terminated in accordance with the Amended Lease. The Company's monthly base rent for the Expansion Space under the Amended Lease will be approximately $39,000 for the first year, and $40,000 for the second year. New York Lease The Company leased office space in New York for a monthly rental of approximately $18,000 a month from January 2017 through July 2017. On June 5, 2017, the Company entered into an agreement whereby the Company will lease office space from August 1, 2017 to July 31, 2018, for approximately $9,000 a month. On April 20, 2018, the Company entered into an agreement to extend the lease term to January 31, 2019 for approximately $7,000 a month. On November 2, 2018, the Company entered into an agreement to extend the lease term to July 31, 2019 for approximately $4,000 a month. On May 1, 2019, the Company entered into an agreement to extend the lease term to January 31, 2020 for approximately $4,000 a month. On October 24, 2019, the Company entered into an agreement to extend the lease term to April 30, 2020 for approximately $4,000 a month. Philadelphia Office Lease On May 2, 2019, the Company entered into an agreement to lease approximately 1,500 square feet of office space in Philadelphia, Pennsylvania until July 1, 2019 for a rate of $2,000 a month, and then approximately 4,500 square feet of office space for the remainder of a three-year term at an initial rate of $11,063 per month, subject to annual increases of 2.5%. Commercial Manufacturing Facility Agreement On May 28, 2019, the Company entered into a lease agreement with 300 Rouse Boulevard, LLC (the “Commercial Manufacturing Facility Lease”) for a build-to-suit commercial manufacturing facility, laboratories, and offices located in Philadelphia, Pennsylvania. Under the Commercial Manufacturing Facility Lease, the Company will lease approximately 136,000 rentable square feet of space in a building to be located at 300 Rouse Boulevard, Philadelphia, Pennsylvania (the “Premises”). The commercial manufacturing facility is expected to be constructed in two phases: Phase I-A, the construction of the commercial manufacturing facility, with approximately 66,000 rentable square feet of space; and Phase I-B, the construction of offices and laboratories, with approximately 70,000 rentable square feet of space. The Commercial Manufacturing Facility Lease is for a term of 242 months , commencing on the earlier of (i) the date on which the Company occupies any portion of the Premises for the normal operation of its business or (ii) the date that is the later of (A) one hundred sixty ( 160 ) days after the Phase I-A substantial completion date, currently anticipated to be July 16, 2020, or (B) the Phase I-B Substantial Completion Date (the “Commencement Date”). The Commencement Date shall be extended by one day for each day of landlord delay, net of any tenant delay, as defined in the Lease. The Commercial Manufacturing Facility Lease includes an option to extend the term of the lease, exercisable under certain conditions as described in the Commercial Manufacturing Facility Lease, such that the overall term, when added to the initial term, shall be 359 months , by giving the landlord prior written notice thereof at least 18 months in advance of the expiration date. Beginning on the Commencement Date, the Company’s monthly base rent under the Lease will be approximately $320,000 , subject to an annual increase of 2% for the first ten years, and an annual increase of the greater of 2% or 75% of the average ten-year consumer price index. The Company will also be responsible for paying operating expenses, which are expected to be approximately $53,000 per month in 2020. Manufacturing Contracts The Company uses contract manufacturing organizations (collectively the “CMOs” and each a “CMO”) to manufacture and supply TILs for clinical and commercial purposes. The CMO contractual obligations consist of the use of manufacturing facilities and minimum fixed commitment fees, such as personnel, general support fees, and minimum production or material fees. In addition to the minimum fixed commitment fees, the CMO contractual obligations include variable costs such as production and material costs in excess of the minimum quantity specified in each CMO agreement. During the term of each CMO agreement, the Company has access to and control of the use of a dedicated suite in each of the CMOs’ facilities for manufacturing activities. In conjunction with the adoption of Topic 842 on January 1, 2019, the Company reevaluated all of its material contracts it has, to determine whether they contain a lease under Topic 840. An arrangement is considered a lease or contains a lease if an underlying asset is explicitly or implicitly identified and use of the asset is controlled by the customer. Based on this evaluation, the Company concluded that all of its contracts with CMOs contained embedded operating leases because the suites used for its production are implicitly identified, is only used by the Company exclusively during the contractual term of the arrangements, and the CMOs have no substantive contractual rights to substitute the facilities used by the Company. Further, the Company controls the use of the facilities by obtaining all of the economic benefits from the use of the facilities and direct the use of the facilities throughout the period of use. The terms of the CMO contracts include options to terminate the lease with an advance notice of five to six months. The termination clauses and extension clauses are included in the calculation of the lease term for each of the CMOs when it is reasonably certain that it will not exercise such options. The guidance requires the Company to first identify a lease deliverable and non-lease deliverable included in the arrangements, and then allocate the fixed contractual consideration to the lease deliverable(s) and the non-lease deliverable(s) on a relative standalone selling price basis to determine the amount of operating lease right-of-use assets and liabilities. The Company identified the use of a dedicated suite as a single lease deliverable, and related labor services as a single non-lease deliverable in each of the CMO arrangements. Judgment is required to determine the relative standalone selling price of each deliverable as the observable standalone selling prices are not readily available. Therefore, management used estimates and assumptions in determining relative standalone selling price of lease of a suite and labor service using information that includes market and other observable inputs to the extent possible. The Company leases certain furniture and equipment that has a lease term of 12 months or less. Since the commencement date does not include an option to purchase the underlying asset, the Company elected not to apply the recognition requirements of Topic 842 for short-term leases, however, the lease costs that pertain to the short-term leases are disclosed in the components of lease costs table below. The balance sheet classification of the Company’s right-of-use asset and lease liabilities was as follows: December 31, 2019 Operating lease right-of-use assets $ 10,695 Operating lease liabilities Current portion included in current liabilities 7,252 Long-term portion included in non-current liabilities 4,248 Total operating lease liabilities $ 11,500 The components of lease expenses, which were included in Total expenses in the Company’s consolidated statement of operations, were as follows: For the Year Ended December 31, 2019 Operating lease cost $ 9,213 Variable lease cost 5,801 Short-term lease cost 72 Total lease cost $ 15,086 Variable lease cost is determined based on performance or usage in accordance with the contractual agreements, and not based on an index or rate. Cash paid for amounts included in the measurement of lease liabilities for the year ended December 31, 2019 was $8.6 million, respectively, and were included in Net cash used by operating activities in its consolidated statement of cash flows. Upon the adoption of Topic 842 on January 1, 2019, the Company increased noncash balances of operating lease right-of-use assets and operating lease liabilities by $10.4 million and $10.7 million, respectively. The Company additionally increased operating lease right-of-use assets by $7.8 million and operating lease liability by $8.9 million for the twelve months ended December 31, 2019 as a result of lease modifications and additional lease agreements entered by the Company. As of December 31, 2019, the maturities of the Company's operating lease liabilities were as follows (in thousands): CMO Facility embedded leases leases Total 2020 $ 1,940 $ 5,881 $ 7,821 2021 968 2,640 3,608 2022 342 — 342 2023 269 — 269 2024 253 — 253 Thereafter — — — Total lease payments $ 3,772 $ 8,521 $ 12,293 Less: Present value adjustment (368) (425) (793) Operating lease liabilities $ 3,404 $ 8,096 $ 11,500 Operating lease liabilities are based on the net present value of the remaining lease payments over the remaining lease term. In determining the present value of lease payments, the Company used its incremental borrowing rate based on the information available at the date of adoption of Topic 842 or the date of lease modifications. As of December 31, 2019, the weighted average remaining lease term is 1.74 years and the weighted average discount rate used to determine the operating lease liabilities was 7.7%. As of December 31, 2019, the Company has a finance lease for the commercial manufacturing facility that has not yet commenced. This finance lease will commence in 2020 with a lease term of 20 years. |
LEGAL PROCEEDINGS
LEGAL PROCEEDINGS | 12 Months Ended |
Dec. 31, 2019 | |
LEGAL PROCEEDINGS | |
LEGAL PROCEEDINGS | NOTE 11. LEGAL PROCEEDINGS Class Action Lawsuit In the Matter of Certain Stock Promotion Leonard DeSilvio v. Lion Biotechnologies, Inc., et al., (Amra Kuc vs. Lion Biotechnologies, Inc., et al., In the Matter of Certain Stock Promotions Kuc Kuc Jay Rabkin v. Lion Biotechnologies, Inc., et al., In the Matter of Certain Stock Promotions no Derivative Lawsuits. In the Matter of Certain Stock Promotions of fiduciary duty, aiding and abetting, waste of corporate assets, and unjust enrichment. The complaint is based on claims arising from the SEC’s investigation in the In the Matter of Certain Stock Promotions In re Iovance Biotherapeutics, Inc. Stockholder Derivative Litigation Solomon Capital, LLC. Solomon Capital, LLC, Solomon Capital 401(K) Trust, Solomon Sharbat and Shelhav Raff v. Lion Biotechnologies, Inc. 1-for-100 On September 27, 2019, the Solomon Plaintiffs filed a new lawsuit (through new legal counsel) titled Solomon Capital, LLC, Solomon Capital 401(K) Trust, Solomon Sharbat and Shelhav Raff v. Iovance Biotherapeutics, Inc., f/k/a/ Lion Biotechnologies Inc. f/k/a/ Genesis Biopharma Inc., and Manish Singh The Company intends to vigorously defend these complaints and pursue its counterclaims, as applicable. At the current stage of the litigation, in both the First Solomon Suit and the Second Solomon Suit, it is not possible to estimate the amount or range of possible loss that might result from an adverse judgment or a settlement of these matters. Litigation Involving Dr. Steven Fischkoff Steven Fischkoff v. Lion Biotechnologies, Inc. and Maria Fardis interest, costs, expenses and attorneys’ fees. On July 5, 2017, the Company filed a removal petition and removed the lawsuit to the United States District Court for the Southern District of New York, where the case has been assigned case no. 1:17-cv-05041. On July 14, 2017, the Company filed a partial answer and counterclaims against Dr. Fischkoff, denying his allegations, and alleging breach of contract and related claims, breach of fiduciary duty, and state and federal trade secret misappropriation and related claims, and sought a temporary restraining order and preliminary injunction against Dr. Fischkoff. On July 18, 2017, the court issued a temporary restraining order against Dr. Fischkoff requiring him to return the Company's materials, prohibiting him from disclosing or using the Company’s materials, and granting expedited discovery. On June 25, 2018, pursuant to a stipulation between the parties, the court entered a permanent injunction prohibiting Dr. Fischkoff from disclosing, possessing, or using any of the Company’s proprietary materials or trade secrets. On July 5, 2018, the court entered an order dismissing two of Dr. Fischkoff’s claims against the Company and Dr. Fardis. On October 18, 2018, Dr. Fischkoff amended his complaint to assert a new claim for defamation arising from SEC filings in which the Company provided the information about this litigation. No trial date has been set in this matter, and the parties are currently engaged in fact discovery. The Company intends to vigorously defend against Dr. Fischkoff’s lawsuit and pursue the Company’s counterclaims. Based on the current stage of the litigation, it is not possible to estimate the amount or range of (i) a possible loss that might result from an adverse judgment or settlement of this action, or (ii) the potential recovery that might result from a favorable judgment or a settlement of this action. Other Matters. In connection with the Company’s reincorporation from Nevada to Delaware in 2017, the Company (as a Delaware corporation) untimely filed a post-effective amendment to adopt a Form S-8 registration statement that the Company filed (as a Nevada corporation) to register the shares underlying the Company’s 2011 Equity Incentive Plan. Before the Company filed the required post-effective amendment, options to purchase 200,000 shares were exercised under the 2011 Equity Incentive Plan. The effect of the delayed post-effective amendment filing on the 200,000 option shares is uncertain, but the issuance and sale of the shares may not have been in compliance with the Form S-8 registration statement. The existence of any liability to the Company, and the amount of any such liability to the Company, as a result of the issuance of the 200,000 shares is uncertain. Accordingly, no accrual for a potential claim has been made by the Company in its financial statements. The Company may be involved, from time to time, in legal proceedings and claims arising in the ordinary course of its business. Such matters are subject to many uncertainties and outcomes are not predictable with assurance. The Company accrues amounts, to the extent they can be reasonably estimated, that it believes are adequate to address any liabilities related to legal proceedings and other loss contingencies that it believes will result in a probable loss. While there can be no assurances as to the ultimate outcome of any legal proceeding or other loss contingency involving the Company, management does not believe any pending matter will be resolved in a manner that would have a material adverse effect on its financial position, results of operations or cash flows. |
QUARTERLY UNAUDITED RESULTS
QUARTERLY UNAUDITED RESULTS | 12 Months Ended |
Dec. 31, 2019 | |
QUARTERLY UNAUDITED RESULTS | |
QUARTERLY UNAUDITED RESULTS | NOTE 12. QUARTERLY UNAUDITED RESULTS The results of operations by quarter for the years ended December 31, 2019 and 2018 are as follow: 2019 2018 (in thousands, except per share information) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Revenue $ — $ — $ — $ — $ — $ — $ — $ — Net loss $ (36,950) $ (47,551) $ (49,487) $ (63,568) $ (26,515) $ (30,660) $ (33,830) $ (32,575) Net loss per share, basic and diluted $ (0.30) $ (0.38) $ (0.40) $ (0.50) $ (0.31) $ (0.34) $ (0.36) $ (0.27) Weighted average share used in computing net loss per share, basic and diluted 123,415 123,567 124,035 126,273 84,350 90,236 95,077 119,085 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2019 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 13. RELATED PARTY TRANSACTIONS A former member of the Company’s board of directors was an attorney at a law firm, TroyGould PC, that rendered legal services to the Company during the period of his directorship until June 6, 2018, but did not provide legal services to the Company himself during that period. The Company paid TroyGould PC $0.4 million, $0.5 million, and $0.7 million during the years ended December 31, 2019, 2018, and 2017, respectively. On September 14, 2017, the Company entered into a three-year consulting agreement with Iain Dukes, D. Phil, the Chairman of the Board. As compensation for his consulting services, the Company granted Dr. Dukes a stock option to purchase up to 150,000 shares of the Company’s common stock, at an exercise price of $7.30 per share. Under the consulting agreement, Dr. Dukes agreed to provide the Company with services regarding business development opportunities, licensing transactions and technology acquisitions by the Company, and any such strategic initiatives appropriate for the Company that Dr. Dukes may identify. The granted stock options vest in 12 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES | |
Cash, Cash Equivalents, and Short-term Investments | Cash, Cash Equivalents, and Short-term Investments The Company’s cash and cash equivalents include short-term investments with original maturities of three months or less when purchased. The Company's short-term investments are classified as “available-for-sale”. The Company includes these investments in current assets and carries them at fair value. Unrealized gains and losses on available-for-sale securities are included in accumulated other comprehensive loss. The cost of debt securities is adjusted for the amortization of premiums and accretion of discounts to maturity. Such amortization and accretion are included in net interest income in the consolidated statements of operations. Gains and losses on securities sold are recorded based on the specific identification method and are included in net interest income in the consolidated statements of operations. The Company has not incurred any realized gains or losses from sales of securities to date. The Company’s investment policy limits investments to certain types of instruments such as certificates of deposit, money market instruments, obligations issued by the U.S. government and U.S. government agencies as well as corporate debt securities, and places restrictions on maturities and concentration by type and issuer. |
Restricted Cash | Restricted Cash The Company maintains a certain minimum balance, currently $5.5 million in a segregated bank account in connection with a letter of credit for the benefit of the landlord for its commercial manufacturing facility used as a security deposit for the lease (See Note 10 - Leases). This amount is classified as Restricted Cash on the Balance Sheet. The letter of credit will expire on May 28, 2020, however, it will be automatically extended, without written agreement, for one-year periods to May 28 in each succeeding calendar year, through at least 60 days after the lease expiration date. Further, on the expiration of the seventh year of the lease, and each anniversary date thereafter, the letter of credit may be decreased by $1.0 million, with a minimum security deposit of $1.5 million maintained through the end of the lease term. As of December 31, 2019, restricted cash consisted of $5.5 million and this amount has been classified as a non-current asset on the Company’s consolidated balance sheets. The following table provides a reconciliation of cash, cash equivalents, and restricted cash, reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows: December 31, December 31, December 31, 2019 2018 2017 Cash $ 13,969 $ 82,152 $ 145,373 Restricted cash (included in non-current assets on the consolidated balance sheets) 5,450 — — Total cash, cash equivalents and restricted cash $ 19,419 $ 82,152 $ 145,373 |
Property and Equipment, net | Property and Equipment, net Property and equipment is stated at cost, net of accumulated depreciation and amortization. The cost of property and equipment is depreciated or amortized on the straight-line method over the following estimated useful lives: Computer equipment 2 years Office furniture and equipment 5 years Lab equipment 5 years Leasehold improvements Lesser of the remaining economic life of the asset or the lease-term Expenditures for maintenance and repairs are charged to operations as incurred while renewals and betterments are capitalized. Gains and losses on disposals are included within operating expenses in the consolidated statements of operations. Management assesses the carrying value of property and equipment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If there is indication of impairment, management prepares an estimate of future undiscounted cash flows expected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the asset, an impairment loss is recognized to write down the asset to its estimated fair value. For the years ended December 31, 2019, 2018, and 2017, the Company did not |
Loss per Share | Loss per Share Basic net loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the sum of the weighted average number of shares of common stock outstanding and the dilutive common stock equivalent shares outstanding during the period. The Company’s potentially dilutive common stock equivalent shares, which include incremental common shares issuable upon (i) the exercise of outstanding stock options and warrants (ii) vesting of restricted stock units and restricted stock awards, and (iii) conversion of preferred stock, are only included in the calculation of diluted net loss per share when their effect is dilutive. At December 31, 2019, 2018, and 2017, the following outstanding common stock equivalents have been excluded from the calculation of net loss per share because their impact would be anti-dilutive. As of December 31, 2019 2018 2017 Stock options 9,494,712 6,889,287 6,072,368 Warrants — — 6,301,216 Series A Convertible Preferred* 97,000 97,000 847,000 Series B Convertible Preferred* 3,581,119 5,854,845 7,378,241 Restricted stock units 22,916 68,742 114,582 13,195,747 12,909,874 20,713,407 *on an as-converted basis The dilutive effect of potentially dilutive securities would be reflected in diluted earnings per common share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of the Company's common stock could result in a greater dilutive effect from potentially dilutive securities. |
Fair Value Measurements | Fair Value Measurements Under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures, fair value is defined as the price at which an asset could be exchanged, or a liability transferred in a transaction between knowledgeable, willing parties in the principal or most advantageous market for the asset or liability. Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters. Where observable prices or parameters are not available, valuation models are applied. Assets and liabilities recorded at fair value in the Company’s financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities, are as follows: Level 1—These are investments where values are based on unadjusted quoted prices for identical assets in an active market that the Company has the ability to access. Level 2—These are investments where values are based on quoted market prices in markets that are not active or model derived valuations in which all significant inputs are observable in active markets The Company does not have fair valued assets classified under Level 2 Level 3—These are financial instruments where values are derived from techniques in which one or more significant inputs are unobservable. The Company does not have fair valued assets classified under Level 3 The Company’s financial instruments consist of cash and cash equivalents and short-term investments, all of which are reported at their respective fair value on its consolidated balance sheets. As of December 31, 2019 and 2018, financial assets measured at fair value on a recurring basis are categorized in the table below based upon the lowest level of significant input to the valuations (in thousands): Assets at Fair Value as of December 31, 2019 Level 1 Level 2 Level 3 Total US treasury securities $ 242,249 $ — $ — $ 242,249 US government agency securities 50,863 — — 50,863 Total $ 293,112 $ — $ — $ 293,112 Assets at Fair Value as of December 31, 2018 Level 1 Level 2 Level 3 Total US treasury securities $ 265,393 $ — $ — $ 265,393 US government agency securities 120,978 — — 120,978 Total $ 386,371 $ — $ — $ 386,371 |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include the assumptions made in valuing stock instruments issued for services and used in measuring operating right-of-use assets and operating lease liabilities, valuation of short-term investments, accounting for potential liabilities, and the valuation allowance associated with the Company’s deferred tax assets. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of Iovance Biotherapeutics, Inc. and its wholly-owned subsidiary, Iovance Biotherapeutics GmbH. All intercompany accounts and transactions have been eliminated. The U.S. dollar is the functional currency for all the Company's consolidated operations. |
Leases | Leases The Company determines if an arrangement includes a lease at inception. Operating leases are included in its consolidated balance sheet as Operating lease right-of-use assets and Operating lease liabilities as of December 31, 2019. Operating lease right-of-use assets represent the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the net present value of lease payments, the Company uses an estimated incremental borrowing rate that is applicable to the Company based on the information available at the later of the lease commencement date or the date of adoption of Accounting Standard Update (ASU) No. 2016-02 and ASU No. 2018-10, Leases (together “Topic 842”). The operating lease right-of-use assets also include any lease payments made less lease incentives. The Company’s leases may include options to extend or terminate the lease, which is considered in the lease term when it is reasonably certain that the Company will exercise any such options. Lease expense is recognized on a straight-line basis over the expected lease term. The Company has elected not to apply the recognition requirements of Topic 842 for short-term leases. For lease agreements entered into after the adoption of Topic 842 that include lease and non-lease components, such components are generally accounted for separately. Prior period amounts continue to be reported in accordance with the Company's historic accounting under previous lease guidance, Topic 840. See “Recently Adopted Accounting Standards - Leases” below, for more information about the impact of the adoption on Topic 842. |
Stock-Based Compensation | Stock-Based Compensation The Company periodically grants stock options to employees in non-capital raising transactions as compensation for services rendered. The Company accounts for stock option grants to employees based on the authoritative guidance provided by the FASB where the value of the award is measured on the date of grant and recognized over the vesting period. Upon the adoption of ASU No. 2018-07, Compensation-Stock Compensation (“Topic 718”), the Company accounts for stock option grants to non-employees in a similar manner as stock option grants to employees except for the term used in the grant date fair value, therefore no longer requiring a re-measurement at the then-current fair values at each reporting date until the share options have vested. The nonemployee awards that contain a performance condition that affects the quantity or other terms of the award are measured based on the outcome that is probable. The fair value of the Company's common stock option grants is estimated using a Black-Scholes option pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the common stock options, and future dividends. The stock-based compensation expense is recorded based upon the value derived from the Black-Scholes option pricing model. The assumptions used in the Black-Scholes option pricing model could materially affect compensation expense recorded in future periods. The Company has in the past issued restricted stock units (RSU) and restricted stock awards (RSA) as part of its share-based compensation programs. The Company measures the compensation cost with respect to RSUs and RSAs issued to employees based upon the estimated fair value of the equity instruments at the date of the grant, which is recognized as an expense over the period during which an employee is required to provide services in exchange for the awards. The fair value of RSUs and RSAs is based on the closing price of the Company’s common stock on the grant date. Total stock-based compensation expense related to all of the Company’s stock-based awards was recorded on the consolidated statements of operations as follows (in thousands): Years Ended December 31, 2019 2018 2017 Research and development $ 11,396 $ 9,305 $ 5,270 General and administrative 12,881 10,722 6,698 Total stock-based compensation expense $ 24,277 $ 20,027 $ 11,968 Total stock-based compensation broken down based on each individual instrument was as follows (in thousands): Years Ended December 31, 2019 2018 2017 Stock option expense $ 23,964 $ 19,758 $ 10,862 Restricted stock award expense — — 34 Restricted stock unit expense 313 269 1,072 Total stock-based compensation expense $ 24,277 $ 20,027 $ 11,968 |
Research and Development Expenses | Research and Development Expenses Research and development expenses include personnel and facility-related expenses, outside contracted services including clinical trial costs, manufacturing and process development costs, research costs and other consulting services. Research and development costs are expensed as incurred. Nonrefundable advance payments for goods or services that will be used or rendered for future research and development activities are deferred and amortized over the period that the goods are delivered, or the related services are performed, subject to an assessment of recoverability. Clinical development costs are a significant component of research and development expenses. The Company has a history of contracting with third parties that perform various clinical trial activities on its behalf in connection with the ongoing development of its product candidates. The financial terms of these contracts are subject to negotiations and may vary from contract to contract and may result in uneven payment flow. The Company accrues and expenses costs for clinical trial activities performed by third parties based upon estimates of the percentage of work completed over the life of the individual trial in accordance with agreements established with contract research organizations and clinical trial sites. The Company determines its estimates through discussions with internal clinical personnel and outside service providers as to the progress or stage of completion of trials or services and the agreed upon fee to be paid for such services. |
General and Administrative Expenses | General and Administrative Expenses General and administrative expenses consist primarily of salaries and other related costs, including stock-based compensation, for personnel in executive, finance, accounting, legal, investor relations, facilities, business development, marketing, commercial and human resources functions. Other significant costs include facility costs not otherwise included in research and development expenses, sublicense royalty expenses, legal fees relating to corporate matters, insurance, public company expenses relating to maintaining compliance with Nasdaq listing rules and Securities and Exchange Commission (“SEC”) requirements, investor relations costs, and fees for accounting and consulting services. General and administrative costs are expensed as incurred, and the Company accrues for services provided by third parties related to the above expenses by monitoring the status of services provided and receiving estimates from its service providers and adjusting its accruals as actual costs become known. |
Income taxes | Income Taxes The Company accounts for income taxes using the asset and liability method whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. ASC Topic 740-10-30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740-10-40 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company will classify as income tax expense any interest and penalties. The Company has no material uncertain tax positions for any of the reporting periods presented. |
Concentrations | Concentrations The Company is subject to credit risk from its portfolio of cash equivalents and short-term investments. Under its investment policy, it limits amounts invested in such securities by credit rating, maturity, industry group, investment type and issuer, except for securities issued by the U.S. government. The Company is not exposed to any significant concentrations of credit risk from these financial instruments. The goals of its investment policy, in order of priority, are as follows: safety and preservation of principal and diversification of risk; liquidity of investments sufficient to meet cash flow requirements; and a competitive after-tax rate of return. The Company maintains cash, cash equivalents and short-term investment balances at three financial institutions. At times, the amounts on deposit may exceed the federally insured limits. Management believes that the financial institutions which hold its cash are financially sound and, accordingly, minimal credit risk exists. As of December 31, 2019, and 2018, respectively, the Company’s cash balances were in excess of insured limits maintained at the financial institutions. |
Preferred Stock | Preferred Stock The Company applies the accounting standards for distinguishing liabilities from equity when determining the classification and measurement of its preferred stock. Preferred shares subject to mandatory redemption are classified as liability instruments and are measured at fair value. Conditionally redeemable preferred shares (including preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, preferred shares are classified as stockholders’ equity. |
Convertible Instruments | Convertible Instruments The Company applies the accounting standards for derivatives and hedging and for distinguishing liabilities from equity when accounting for hybrid contracts that feature conversion options. The accounting standards require companies to bifurcate conversion options from their host instruments and account for them as free-standing derivative financial instruments according to certain criteria. The criteria include circumstances in which (i) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (ii) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (iii) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. The derivative is subsequently marked to market at each reporting date based on current fair value, with the changes in fair value reported in results of operations. Conversion options that contain variable settlement features such as provisions to adjust the conversion price upon subsequent issuances of equity or equity linked securities at exercise prices more favorable than that featured in the hybrid contract generally result in their bifurcation from the host instrument. The Company also records, when necessary, deemed dividends for the intrinsic value of the conversion options embedded in preferred stock based upon the difference between the fair value of the underlying common stock at the commitment date of the transaction and the effective conversion price embedded in the preferred stock. |
Recent Accounting Standards | Recent Accounting Standards Leases On January 1, 2019, the Company adopted Topic 842, which establishes a new lease accounting method for lessees. The updated guidance requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. The Company elected the package of practical expedients requiring no reassessment of whether any expired or existing contracts are or contain leases, the lease classification of any expired or existing leases, or initial direct costs for any existing leases. The standard had a material impact on its consolidated balance sheets by recognizing Operating lease right-of-use assets and Operating lease liabilities for operating leases but did not have an impact on its consolidated statement of operations or cash flows. The adoption of Topic 842 resulted in recognition of Operating lease right-of-use assets of $10.4 million, $4.9 million of Operating lease liabilities - current, and $5.8 million of Operating lease liabilities - noncurrent as of January 1, 2019, the date of adoption. Improvements to Nonemployee Share-Based Payment Accounting On January 1, 2019, the Company adopted Topic 718, which eliminates the separate accounting method for nonemployee share-based payment awards and requires companies to account for share-based payment transactions with nonemployees in the same manner as share-based payment transactions with employees except for the term used in the grant date fair value. Under the new guidance, nonemployee share-based payment transactions are measured at the grant-date fair value and are no longer remeasured at the then-current fair values at each reporting date until the share options have vested. The guidance requires a modified-retrospective approach in transition. The Company compared the cumulative amounts that were recorded for its nonemployee share-based payments through December 31, 2018 immediately preceding the date of adoption to the cumulative amounts that should be recognized at the adoption date and recognized a cumulative effect of the transition adjustment of $0.3 million to retained earnings as of the date of adoption, January 1, 2019. Fair Value Measurements Disclosure In August 2018, the FASB issued ASU No. 2018-13 Fair Value Measurement (Topic 820): Disclosure Framework- Changes to the Disclosure Requirements for Fair Value Measurement, which eliminates disclosure requirement regarding transfers between level 1 and level 2 of the fair value of hierarchy, however, adds disclosure requirements on the range and weighted average used to develop significant unobservable inputs for level 3 fair value measurements. The Company adopted the guidance on January 1, 2019, however, there was no adjustment required to its disclosures as it did not have fair value assets classified under level 2 or 3 as of December 31, 2019 and 2018. Financial Instruments In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses, and also issued subsequent amendments to the initial guidance, ASU 2018-19, ASU 2019-04, ASU 2019-05, and ASU 2019-11 (collectively, Topic 326), to introduce a new impairment model for recognizing credit losses on financial instruments based on an estimate of current expected credit losses (CECL). Under Topic 326, an entity is required to estimate CECL on available-for-sale (AFS) debt securities only when the fair value is below the amortized cost of the asset and is no longer based on an impairment being “other-than-temporary”. Topic 326 also requires the impairment calculation on an individual security level and requires an entity use present value of cash flows when estimating the CECL. The credit-related losses are required to be recognized through earnings and non-credit related losses are reported in other comprehensive income. In April 2019, the FASB further clarified the scope of Topic 326 and addressed issues related to accrued interest receivable balances, recoveries, variable interest rates and prepayment. Topic 326 will be effective for public entities in fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The new guidance will require modified retrospective application to all outstanding instruments, with a cumulative effect adjustment recorded to opening retained earnings as of the beginning of the first period in which the guidance becomes effective. The Company will adopt this guidance on January 1, 2020, however, the Company does not believe the adoption of this new guidance will have any material impact on its consolidated financial statements. Cloud Computing Arrangements In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (ASU 2018-15), to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement (hosting arrangement) by providing guidance for determining when the arrangement includes a software license. The guidance provided generally means that an intangible asset is recognized for the software license and, to the extent that the payments attributable to the software license are made over time, a liability also is recognized. If a cloud computing arrangement does not include a software license, the entity should account for the arrangement as a service contract. This generally means that the fees associated with the hosting element (service) of the arrangement are expensed as incurred. ASU 2018-15 is effective for fiscal years beginning subsequent to December 15, 2019. The Company plans to adopt this guidance on January 1, 2020, and believes it will have a material impact on its consolidated balance sheets and statements of operations during 2020 by deferring recognition of costs as it prepares to invest in information technology infrastructure for its commercial manufacturing build-out. |
Segment reporting | Segment reporting The Company operates in one segment, focused on developing and commercializing ACT using autologous TIL for the treatment of metastatic melanoma and other solid cancers. |
Subsequent Events | Subsequent Events Management of the Company evaluates events that have occurred after the balance sheet date through the date the financial statements are issued. Based upon the review, the Company identified the following subsequent events. Research collaboration and exclusive worldwide license agreement On January 12, 2020, the Company announced that it had entered into a research collaboration and exclusive worldwide license agreement whereby the Company will license gene-editing technology from Cellectis S.A. (“Cellectis”), a clinical-stage biopharmaceutical company, in order to develop TIL therapies that have been genetically edited. Financial terms of the license include development, regulatory and sales milestone payments from the Company to Cellectis, as well as royalty payments based on net sales of TALEN-modified TIL products. On January 12, 2020, the Company announced that it had obtained a license from Novartis Pharma AG (“Novartis”) to develop and commercialize an antibody cytokine engrafted protein, referred to as IOV-3001. Under the agreement, Iovance has paid an upfront payment to Novartis and may pay future milestones related to initiation of patent dosing in various phases of clinical development for IOV-3001 and approval of the product in the U.S, EU and Japan. Novartis is also entitled to low-to-mid single digit royalties from commercial sales of the product. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES | |
Schedule of cash and cash equivalents and restricted cash | The following table provides a reconciliation of cash, cash equivalents, and restricted cash, reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows: December 31, December 31, December 31, 2019 2018 2017 Cash $ 13,969 $ 82,152 $ 145,373 Restricted cash (included in non-current assets on the consolidated balance sheets) 5,450 — — Total cash, cash equivalents and restricted cash $ 19,419 $ 82,152 $ 145,373 |
Schedule Of Useful Lives Of Property Plant And Equipment [Table Text Block] | Computer equipment 2 years Office furniture and equipment 5 years Lab equipment 5 years Leasehold improvements Lesser of the remaining economic life of the asset or the lease-term |
Schedule of Antidilutive securities excluded from computation of earnings per share | As of December 31, 2019 2018 2017 Stock options 9,494,712 6,889,287 6,072,368 Warrants — — 6,301,216 Series A Convertible Preferred* 97,000 97,000 847,000 Series B Convertible Preferred* 3,581,119 5,854,845 7,378,241 Restricted stock units 22,916 68,742 114,582 13,195,747 12,909,874 20,713,407 *on an as-converted basis |
Schedule of assets measured at fair value | Assets at Fair Value as of December 31, 2019 Level 1 Level 2 Level 3 Total US treasury securities $ 242,249 $ — $ — $ 242,249 US government agency securities 50,863 — — 50,863 Total $ 293,112 $ — $ — $ 293,112 Assets at Fair Value as of December 31, 2018 Level 1 Level 2 Level 3 Total US treasury securities $ 265,393 $ — $ — $ 265,393 US government agency securities 120,978 — — 120,978 Total $ 386,371 $ — $ — $ 386,371 |
Schedule of stock-based compensation | Years Ended December 31, 2019 2018 2017 Research and development $ 11,396 $ 9,305 $ 5,270 General and administrative 12,881 10,722 6,698 Total stock-based compensation expense $ 24,277 $ 20,027 $ 11,968 |
Schedule of compensation cost for share-based payment arrangements, allocation of share-based compensation costs by plan | Years Ended December 31, 2019 2018 2017 Stock option expense $ 23,964 $ 19,758 $ 10,862 Restricted stock award expense — — 34 Restricted stock unit expense 313 269 1,072 Total stock-based compensation expense $ 24,277 $ 20,027 $ 11,968 |
CASH AND CASH EQUIVALENTS, AN_2
CASH AND CASH EQUIVALENTS, AND SHORT-TERM INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
CASH AND CASH EQUIVALENTS, AND SHORT-TERM INVESTMENTS | |
Schedule of cash, money market funds and short-term investments | Cash equivalents, and short-term investments consist of the following (in thousands): December 31, December 31, 2019 2018 Cash equivalents - Money market funds $ 10,049 $ 25,968 Cash equivalents total $ 10,049 $ 25,968 |
Schedule of cost and fair value of cash equivalents and short-term investments | Cash equivalents in the tables above exclude cash demand deposits of $3.9 million and $56.2 million as of December 31, 2019 and 2018, respectively (in thousands). December 31, December 31, Short-term Investments 2019 2018 US treasury securities $ 242,249 $ 265,393 US government agency securities 50,863 120,978 Short-term investments total $ 293,112 $ 386,371 The cost and fair value of cash equivalents and short-term investments at December 31, 2018 and 2019 were as follows (in thousands): Gross Gross Unrealized Unrealized As of December 31, 2019 Cost Accretion Gains Losses Fair Value US treasury securities $ 241,709 $ 364 $ 179 $ (3) $ 242,249 US government agency securities 50,712 107 44 — 50,863 Total $ 292,421 $ 471 $ 223 $ (3) $ 293,112 Gross Gross Unrealized Unrealized As of December 31, 2018 Cost Accretion Gains Losses Fair Value US treasury securities $ 264,619 $ 813 $ 19 $ (58) $ 265,393 US government agency securities 120,653 328 21 (24) 120,978 Total $ 385,272 $ 1,141 $ 40 $ (82) $ 386,371 |
BALANCE SHEET COMPONENTS (Table
BALANCE SHEET COMPONENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
BALANCE SHEET COMPONENTS | |
Schedule of Property, Plant and Equipment | December 31, December 31, 2019 2018 Lab equipment $ 4,530 $ 4,160 Leasehold improvements 2,372 1,776 Computer equipment 258 337 Office furniture and equipment 457 263 Construction in progress 5,417 107 Total Property and equipment, cost 13,034 6,643 Less: Accumulated depreciation and amortization (4,498) (3,960) property and equipment, net $ 8,536 $ 2,683 |
Schedule of accrued liabilities | December 31, December 31, 2019 2018 Accrued payroll and employee related expenses $ 6,866 $ 4,113 Legal and related services 866 825 Clinical related 4,692 3,424 Manufacturing related 2,184 2,684 Deferred rent - current — 124 Accrued other 1,657 489 $ 16,265 $ 11,659 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
STOCKHOLDERS' EQUITY | |
Schedule of Stockholders' Equity Note, Warrants or Rights | Weighted Weighted Aggregate Shares Average Average Intrinsic Under Exercise Remaining Value Warrants Price Life (in thousands) Outstanding at January 1, 2017 6,566,216 $ 2.51 Issued — — Exercised (265,000) 2.50 Expired/Cancelled — — Outstanding at December 31, 2017 6,301,216 $ 2.51 Issued — — Exercised (6,301,216) 2.51 Expired/Cancelled — — Outstanding at December 31, 2018 — $ — — $ — Outstanding at December 31, 2019 — $ — — $ — |
STOCK BASED COMPENSATION (Table
STOCK BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
STOCK BASED COMPENSATION | |
Schedule of status of stock options | Weighted Weighted Average Aggregate Number Average Remaining Intrinsic of Exercise Contractual Value Options Price Life (in thousands) Outstanding at January 1, 2017 6,233,150 $ 7.24 Issued 2,188,800 6.68 Exercised (1,011,284) 5.55 Expired/Cancelled (1,338,298) 6.79 Outstanding at December 31, 2017 6,072,368 $ 7.42 Issued 2,960,620 14.73 Exercised (1,336,514) 7.45 Expired/Cancelled (807,187) 10.04 Outstanding at December 31, 2018 6,889,287 $ 10.25 Issued 4,166,600 14.73 Exercised (727,492) 8.85 Expired/Cancelled (833,683) 13.87 Outstanding at December 31, 2019 9,494,712 $ 12.00 8.05 years $ 149,493 Exercisable at December 31, 2019 4,548,959 $ 9.61 6.95 years $ 82,864 |
Schedule of share-based payment award, stock options, valuation assumptions | Years Ended December 31, 2019 2018 2017 Expected dividend yield 0% 0% 0% Risk-free interest rate 2.59% - 1.62% 2.97% - 2.27% 2.34% - 1.72% Expected term (in years) 6.14 6.06 6.50 5.13 6.50 5.13 Expected volatility 71.62% - 70.63% 200.28% - 167.54% 209.69% - 190.46% |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding and Exercisable | A summary of outstanding and exercisable stock options as of December 31, 2019 is as follows: Options Outstanding Options Exercisable Weighted Weighted Average Weighted Average Weighted Remaining Average Remaining Average Range of Exercise Number of Contractual Exercise Price Number of Contractual Exercise Price Prices Shares Life Per Share Shares Life Per Share $5.05 - $5.87 1,086,300 6.71 $ 5.56 945,048 6.65 $ 5.56 $5.88 - $7.55 1,413,645 6.57 7.25 1,329,098 6.51 7.28 $7.56 - $9.10 970,107 6.87 8.44 830,055 6.60 8.45 $9.11 - $10.69 962,900 8.69 9.70 248,689 7.60 9.44 $10.70 - $11.15 118,950 6.43 11.06 88,750 5.45 11.05 $11.16 - $11.26 1,574,900 9.17 11.26 — — — $11.27 - $16.50 1,283,110 8.22 14.93 719,738 7.95 15.23 $16.51 - $19.75 1,046,000 8.69 17.62 378,581 8.12 17.33 $19.76 - $25.78 994,800 9.66 21.79 — — — $25.79 - 117.00 44,000 8.28 42.15 9,000 1.73 99.12 9,494,712 8.05 $ 12.00 4,548,959 6.95 $ 9.61 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INCOME TAXES | |
Schedule of Deferred Tax Assets and Liabilities | As of December 31, 2019 2018 Deferred income tax asset: Net operating loss carry forward $ 95,473 $ 56,971 Stock-based compensation 8,851 5,823 Tax credit carry forwards 22,711 14,356 Lease liabilities 2,529 Depreciation and amortization 98 Reserves and accruals 1,410 1,049 Deferred tax assets before valuation allowance 131,072 78,199 Less: valuation allowance (128,720) (78,146) Net deferred income tax assets 2,352 53 Deferred tax liabilities: Depreciation and amortization (2,352) (53) Net deferred tax assets (liabilities) $ — $ — |
Schedule of Effective Income Tax Rate Reconciliation | Years ended December 31, 2019 2018 2017 Federal statutory tax rate (21) % (21) % (34) % Orphan Drug & Research credits (4) (3) — Permanent and other differences 1 1 4 Tax rate change — — 23 State tax, net of federal benefit (2) (1) — (26) % (24) % (7) % Valuation allowance 26 % 24 % 7 % Effective tax rate — % — % — % |
Schedule of Components of Income Tax Expense (Benefit) | Years Ended December 31, 2019 2018 2017 Federal: Current $ — $ — $ — Deferred (47,010) (28,277) (7,391) State and Local Current — — — Deferred (3,564) (2,020) 944 Change in Valuation Allowance 50,574 30,297 6,447 Total income tax expense (benefit) $ — $ — $ — |
Schedule of Unrecognized Tax Benefits | Years Ended December 31, 2019 2018 2017 Unrecognized benefit - beginning of period $ 6,344 $ 4,111 $ — Gross decreases - prior period tax positions — 118 2,780 Gross increase current period tax positions 3,694 2,115 1,331 Unrecognized benefit - end of period $ 10,038 $ 6,344 $ 4,111 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LEASES | |
Schedule of balance sheet classification of the Company's right-of-use asset and lease liabilities | The balance sheet classification of the Company’s right-of-use asset and lease liabilities was as follows: December 31, 2019 Operating lease right-of-use assets $ 10,695 Operating lease liabilities Current portion included in current liabilities 7,252 Long-term portion included in non-current liabilities 4,248 Total operating lease liabilities $ 11,500 |
Schedule of components of lease expenses | The components of lease expenses, which were included in Total expenses in the Company’s consolidated statement of operations, were as follows: For the Year Ended December 31, 2019 Operating lease cost $ 9,213 Variable lease cost 5,801 Short-term lease cost 72 Total lease cost $ 15,086 |
Schedule of maturities of the Company's operating lease liabilities | As of December 31, 2019, the maturities of the Company's operating lease liabilities were as follows (in thousands): CMO Facility embedded leases leases Total 2020 $ 1,940 $ 5,881 $ 7,821 2021 968 2,640 3,608 2022 342 — 342 2023 269 — 269 2024 253 — 253 Thereafter — — — Total lease payments $ 3,772 $ 8,521 $ 12,293 Less: Present value adjustment (368) (425) (793) Operating lease liabilities $ 3,404 $ 8,096 $ 11,500 |
QUARTERLY UNAUDITED RESULTS (Ta
QUARTERLY UNAUDITED RESULTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
QUARTERLY UNAUDITED RESULTS | |
Schedule of Quarterly Financial Information | 2019 2018 (in thousands, except per share information) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Revenue $ — $ — $ — $ — $ — $ — $ — $ — Net loss $ (36,950) $ (47,551) $ (49,487) $ (63,568) $ (26,515) $ (30,660) $ (33,830) $ (32,575) Net loss per share, basic and diluted $ (0.30) $ (0.38) $ (0.40) $ (0.50) $ (0.31) $ (0.34) $ (0.36) $ (0.27) Weighted average share used in computing net loss per share, basic and diluted 123,415 123,567 124,035 126,273 84,350 90,236 95,077 119,085 |
GENERAL ORGANIZATION AND BUSI_2
GENERAL ORGANIZATION AND BUSINESS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
GENERAL ORGANIZATION AND BUSINESS | |||||||||||
Net Loss | $ (63,568) | $ (49,487) | $ (47,551) | $ (36,950) | $ (32,575) | $ (33,830) | $ (30,660) | $ (26,515) | $ (197,556) | $ (123,580) | $ (92,064) |
Net cash used in operating activities | (158,889) | (101,249) | (78,709) | ||||||||
cash equivalents, short-term investments, and restricted cash | 312,500 | 312,500 | |||||||||
Cash and cash equivalents | 13,969 | 82,152 | 13,969 | 82,152 | $ 145,373 | ||||||
Short-term investments | 293,112 | $ 386,371 | 293,112 | $ 386,371 | |||||||
Restricted cash | $ 5,450 | $ 5,450 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES - Cash, Cash equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Security deposit | $ 5,500 | |||
Letter of credit | 1,000 | |||
Cash | 13,969 | $ 82,152 | $ 145,373 | |
Restricted cash (included in non-current assets on the consolidated balance sheets) | 5,450 | |||
Total cash, cash equivalents and restricted cash | 19,419 | $ 82,152 | $ 145,373 | $ 106,717 |
Minimum | ||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Security deposit | $ 1,500 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES - Useful lives, impairment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Impairment of Long-Lived Assets Held-for-use | $ 0 | $ 0 | $ 0 |
Computer equipment | |||
Property, Plant and Equipment, Useful Life | 2 years | ||
Office furniture and equipment | |||
Property, Plant and Equipment, Useful Life | 5 years | ||
Lab equipment | |||
Property, Plant and Equipment, Useful Life | 5 years | ||
Leasehold improvements | |||
Property, Plant and Equipment, Estimated Useful Lives | Lesser of the remaining economic life of the asset or the lease-term |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES - Loss per share (Details) - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Antidilutive securities excluded from calculation of net loss per share | 13,195,747 | 12,909,874 | 20,713,407 |
Stock option | |||
Antidilutive securities excluded from calculation of net loss per share | 9,494,712 | 6,889,287 | 6,072,368 |
Warrant | |||
Antidilutive securities excluded from calculation of net loss per share | 6,301,216 | ||
Restricted stock units | |||
Antidilutive securities excluded from calculation of net loss per share | 22,916 | 68,742 | 114,582 |
Series A Convertible Preferred Stock | |||
Antidilutive securities excluded from calculation of net loss per share | 97,000 | 97,000 | 847,000 |
Series B Convertible Preferred Stock | |||
Antidilutive securities excluded from calculation of net loss per share | 3,581,119 | 5,854,845 | 7,378,241 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES - Fair value (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Level 2 | ||
Total | $ 0 | $ 0 |
Level 3 | ||
Total | 0 | 0 |
Fair Value, Measurements, Recurring | ||
Total | 293,112,000 | 386,371,000 |
Fair Value, Measurements, Recurring | US treasury securities | ||
Total | 242,249,000 | 265,393,000 |
Fair Value, Measurements, Recurring | US government agency securities | ||
Total | 50,863,000 | 120,978,000 |
Fair Value, Measurements, Recurring | Level 1 | ||
Total | 293,112,000 | 386,371,000 |
Fair Value, Measurements, Recurring | Level 1 | US treasury securities | ||
Total | 242,249,000 | 265,393,000 |
Fair Value, Measurements, Recurring | Level 1 | US government agency securities | ||
Total | $ 50,863,000 | $ 120,978,000 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES - Stock-based compensation expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Total stock-based compensation expenses | $ 24,277 | $ 20,027 | $ 11,968 |
Research and development | |||
Total stock-based compensation expenses | 11,396 | 9,305 | 5,270 |
General and administrative | |||
Total stock-based compensation expenses | $ 12,881 | $ 10,722 | $ 6,698 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES - Stock-based compensation by instrument (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Total stock-based compensation expenses | $ 24,277 | $ 20,027 | $ 11,968 |
Stock option | |||
Total stock-based compensation expenses | 23,964 | 19,758 | 10,862 |
Restricted stock award expenses | |||
Total stock-based compensation expenses | 34 | ||
Restricted stock units | |||
Total stock-based compensation expenses | $ 313 | $ 269 | $ 1,072 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES - Concentrations, etc. (Details) $ in Millions | Jan. 01, 2019USD ($) | Dec. 31, 2019item |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Number Of Financial Institutions | item | 3 | |
Lease, Practical Expedients, Package [true false] | true | |
Restatement Adjustment | Accounting Standards Update 2018-07 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ | $ 0.3 |
SUMMARY OF SIGNIFICANT ACCOU_11
SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES - Additional information (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($)segment | Jan. 01, 2019USD ($) | |
Operating lease right-of-use assets | $ 10,695 | |
Operating lease liabilities - current | 7,252 | |
Operating lease liabilities - noncurrent | $ 4,248 | |
Number of operating segment | segment | 1 | |
ASU 2016-02 | ||
Operating lease right-of-use assets | $ 10,400 | |
Operating lease liabilities - current | 4,900 | |
Operating lease liabilities - noncurrent | $ 5,800 |
CASH AND CASH EQUIVALENTS, AN_3
CASH AND CASH EQUIVALENTS, AND SHORT-TERM INVESTMENTS (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Cash equivalents total | $ 13,969 | $ 82,152 | $ 145,373 |
Money Market Funds | |||
Cash equivalents total | 10,049 | 25,968 | |
Demand Deposits | |||
Cash equivalents total | $ 3,900 | $ 56,200 |
CASH AND CASH EQUIVALENTS, AN_4
CASH AND CASH EQUIVALENTS, AND SHORT-TERM INVESTMENTS - Short-term investments (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Short-term Investments | $ 293,112 | $ 386,371 |
US treasury securities | ||
Short-term Investments | 242,249 | 265,393 |
US government agency securities | ||
Short-term Investments | $ 50,863 | $ 120,978 |
CASH AND CASH EQUIVALENTS, AN_5
CASH AND CASH EQUIVALENTS, AND SHORT-TERM INVESTMENTS - Cost and fair value (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Cost | $ 292,421 | $ 385,272 |
Accretion | 471 | 1,141 |
Gross Unrealized Gains | 223 | 40 |
Gross Unrealized Losses | (3) | (82) |
Fair Value | 293,112 | 386,371 |
US treasury securities | ||
Cost | 241,709 | 264,619 |
Accretion | 364 | 813 |
Gross Unrealized Gains | 179 | 19 |
Gross Unrealized Losses | (3) | (58) |
Fair Value | 242,249 | 265,393 |
US government agency securities | ||
Cost | 50,712 | 120,653 |
Accretion | 107 | 328 |
Gross Unrealized Gains | 44 | 21 |
Gross Unrealized Losses | (24) | |
Fair Value | $ 50,863 | $ 120,978 |
BALANCE SHEET COMPONENTS - Accr
BALANCE SHEET COMPONENTS - Accrued liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
BALANCE SHEET COMPONENTS | ||
Accrued payroll and employee related expenses | $ 6,866 | $ 4,113 |
Legal and related services | 866 | 825 |
Clinical related | 4,692 | 3,424 |
Manufacturing related | 2,184 | 2,684 |
Deferred rent - current | 124 | |
Accrued other | 1,657 | 489 |
Accrued liabilities | $ 16,265 | $ 11,659 |
BALANCE SHEET COMPONENTS - Othe
BALANCE SHEET COMPONENTS - Other information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
BALANCE SHEET COMPONENTS | |||
Depreciation | $ 1.2 | $ 1 | $ 1 |
BALANCE SHEET COMPONENTS - Addi
BALANCE SHEET COMPONENTS - Additional information (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Total Property and equipment, cost | $ 13,034 | $ 6,643 |
Less: Accumulated depreciation and amortization | (4,498) | (3,960) |
Property and equipment, net | 8,536 | 2,683 |
Lab equipment | ||
Total Property and equipment, cost | 4,530 | 4,160 |
Leasehold improvements | ||
Total Property and equipment, cost | 2,372 | 1,776 |
Computer equipment | ||
Total Property and equipment, cost | 258 | 337 |
Office furniture and equipment | ||
Total Property and equipment, cost | 457 | 263 |
Construction in progress | ||
Total Property and equipment, cost | $ 5,417 | $ 107 |
STOCKHOLDERS' EQUITY - Warrant
STOCKHOLDERS' EQUITY - Warrant activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Shares Under Warrants | |||
Outstanding, ending balance | 9,494,712 | ||
Weighted Average Exercise Price | |||
Outstanding, ending balance | $ 12 | ||
Weighted Average Remaining Contractual Life | |||
Options outstanding, remaining term | 8 years 18 days | ||
Warrant | |||
Shares Under Warrants | |||
Outstanding, beginning balance | 0 | 6,301,216 | 6,566,216 |
Issued | 0 | 0 | |
Exercised | (6,301,216) | (265,000) | |
Expired/Cancelled | 0 | 0 | |
Outstanding, ending balance | 0 | 0 | 6,301,216 |
Weighted Average Exercise Price | |||
Outstanding, beginning balance | $ 0 | $ 2.51 | $ 2.51 |
Exercise price (in dollars per share) | 0 | 0 | |
Exercised | 2.51 | 2.50 | |
Expired/Cancelled | 0 | 0 | |
Outstanding, ending balance | $ 0 | $ 0 | $ 2.51 |
Weighted Average Remaining Contractual Life | |||
Options outstanding, remaining term | 0 years | 0 years | |
Aggregate Intrinsic Value | |||
Outstanding, ending balance | $ 0 | $ 0 |
STOCKHOLDERS' EQUITY - Addition
STOCKHOLDERS' EQUITY - Additional Information (Details) - USD ($) | Jun. 10, 2019 | Jan. 16, 2019 | Oct. 17, 2018 | Jan. 31, 2018 | Sep. 30, 2013 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Class of Stock [Line Items] | ||||||||
Common stock sold in public offering, net of offering costs (in shares) | 17,500 | 50,000 | ||||||
Stock repurchased (in shares) | 32,500 | |||||||
Gross proceeds from issuance of common stock | $ 252,200,000 | $ 172,500,000 | ||||||
Proceeds from the issuance of common stock, net | $ 236,700,000 | $ 162,000,000 | ||||||
Common stock, par or stated value per share | $ 0.000041666 | $ 0.000041666 | $ 0.000041666 | |||||
Common stock, shares authorized | 150,000,000 | 300,000,000 | 150,000,000 | |||||
Preferred stock, shares authorized | 50,000,000 | |||||||
Sale of stock, price per share | $ 9.97 | $ 11.50 | ||||||
Other Income | ||||||||
Class of Stock [Line Items] | ||||||||
Proceeds from the issuance of common stock, net | $ 335,000 | |||||||
Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock sold in public offering, net of offering costs (in shares) | 25,300,000 | 15,000,000 | 40,300,000 | 8,846,154 | ||||
Common Stock | Issuance Of Common Stock Upon Conversion Of Preferred Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Conversion of stock, shares issued | 2,273,726 | |||||||
Conversion of Stock, shares converted | 750,000 | |||||||
Underwriter | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock sold in public offering, net of offering costs (in shares) | 300,000,000 | 3,300,000 | 1,956,521 | |||||
Series A Convertible Preferred Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Preferred stock, shares authorized | 17,000 | |||||||
Preferred stock, shares outstanding | 194 | 194 | ||||||
Conversion of Stock, shares converted | 1,500 | |||||||
Common stock available in conversion, shares | 97,000 | 97,000 | ||||||
Series A Convertible Preferred Stock | Private Placement | ||||||||
Class of Stock [Line Items] | ||||||||
Preferred stock, shares authorized | 17,000 | |||||||
Sale of stock, price per share | $ 2 | |||||||
Preferred stock, par or stated value per share | $ 1,000 | |||||||
Series B Convertible Preferred Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Preferred stock, shares authorized | 11,500,000 | 11,500,000 | ||||||
Preferred stock, par or stated value per share | $ 0.001 | $ 0.001 | ||||||
Convertible price per shares | $ 4.75 | |||||||
Preferred stock, shares outstanding | 3,581,119 | 5,854,845 | ||||||
Conversion of Stock, shares converted | 2,273,726 | 1,523,396 | ||||||
Series B Convertible Preferred Stock | Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Preferred stock, shares outstanding | 3,581,119 | |||||||
Conversion of stock, shares issued | 5,854,845 | |||||||
Series B Convertible Preferred Stock | Common Stock | Issuance Of Common Stock Upon Conversion Of Preferred Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Conversion of stock, shares issued | 1,523,396 |
STOCK BASED COMPENSATION - Stoc
STOCK BASED COMPENSATION - Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Number of Options | |||
Outstanding, ending balance | 9,494,712 | ||
Options exercisable, number | 4,548,959 | ||
Weighted Average Exercise Price | |||
Outstanding, ending balance | $ 12 | ||
Options exercisable, exercise price | $ 9.61 | ||
Weighted Average Remaining Contractual Life | |||
Options outstanding, remaining term | 8 years 18 days | ||
Options exercisable, remaining term | 6 years 11 months 12 days | ||
Stock option | |||
Number of Options | |||
Outstanding, beginning balance | 6,889,287 | 6,072,368 | 6,233,150 |
Issued | 4,166,600 | 2,960,620 | 2,188,800 |
Exercised | (727,492) | (1,336,514) | (1,011,284) |
Expired/Forfeited | (833,683) | (807,187) | (1,338,298) |
Outstanding, ending balance | 9,494,712 | 6,889,287 | 6,072,368 |
Options exercisable, number | 4,548,959 | ||
Weighted Average Exercise Price | |||
Outstanding, beginning balance | $ 10.25 | $ 7.42 | $ 7.24 |
Exercise price (in dollars per share) | 14.73 | 14.73 | 6.68 |
Exercised | 8.85 | 7.45 | 5.55 |
Expired/Forfeited | 13.87 | 10.04 | 6.79 |
Outstanding, ending balance | 12 | $ 10.25 | $ 7.42 |
Options exercisable, exercise price | $ 9.61 | ||
Weighted Average Remaining Contractual Life | |||
Options outstanding, remaining term | 8 years 18 days | ||
Options exercisable, remaining term | 6 years 11 months 12 days | ||
Aggregate Intrinsic Value | |||
Outstanding, end of period | $ 149,493 | ||
Exercisable | $ 82,864 |
STOCK BASED COMPENSATION - Assu
STOCK BASED COMPENSATION - Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Maximum | |||
Risk-free interest rate | 2.59% | 2.97% | 2.34% |
Expected term (years) | 6 years 1 month 21 days | 6 years 6 months | 6 years 6 months |
Expected volatility | 71.62% | 200.28% | 209.69% |
Minimum | |||
Risk-free interest rate | 1.62% | 2.27% | 1.72% |
Expected term (years) | 6 years 22 days | 5 years 1 month 17 days | 5 years 1 month 17 days |
Expected volatility | 70.63% | 167.54% | 190.46% |
STOCK BASED COMPENSATION - Exer
STOCK BASED COMPENSATION - Exercise price (Details) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options outstanding, number | shares | 9,494,712 |
Options outstanding, remaining term | 8 years 18 days |
Options outstanding, exercise price | $ 12 |
Options exercisable, number | shares | 4,548,959 |
Options exercisable, remaining term | 6 years 11 months 12 days |
Options exercisable, exercise price | $ 9.61 |
$5.05 to $5.87 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options exercise price, lower limit | 5.05 |
Options exercise price, upper limit | $ 5.87 |
Options outstanding, number | shares | 1,086,300 |
Options outstanding, remaining term | 6 years 8 months 16 days |
Options outstanding, exercise price | $ 5.56 |
Options exercisable, number | shares | 945,048 |
Options exercisable, remaining term | 6 years 7 months 24 days |
Options exercisable, exercise price | $ 5.56 |
$5.88 - $7.55 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options exercise price, lower limit | 5.88 |
Options exercise price, upper limit | $ 7.55 |
Options outstanding, number | shares | 1,413,645 |
Options outstanding, remaining term | 6 years 6 months 26 days |
Options outstanding, exercise price | $ 7.25 |
Options exercisable, number | shares | 1,329,098 |
Options exercisable, remaining term | 6 years 6 months 4 days |
Options exercisable, exercise price | $ 7.28 |
$7.56 - $9.10 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options exercise price, lower limit | 7.56 |
Options exercise price, upper limit | $ 9.10 |
Options outstanding, number | shares | 970,107 |
Options outstanding, remaining term | 6 years 10 months 13 days |
Options outstanding, exercise price | $ 8.44 |
Options exercisable, number | shares | 830,055 |
Options exercisable, remaining term | 6 years 7 months 6 days |
Options exercisable, exercise price | $ 8.45 |
$9.11 - $10.69 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options exercise price, lower limit | 9.11 |
Options exercise price, upper limit | $ 10.69 |
Options outstanding, number | shares | 962,900 |
Options outstanding, remaining term | 8 years 8 months 8 days |
Options outstanding, exercise price | $ 9.70 |
Options exercisable, number | shares | 248,689 |
Options exercisable, remaining term | 7 years 7 months 6 days |
Options exercisable, exercise price | $ 9.44 |
$10.70 - $11.15 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options exercise price, lower limit | 10.70 |
Options exercise price, upper limit | $ 11.15 |
Options outstanding, number | shares | 118,950 |
Options outstanding, remaining term | 6 years 5 months 5 days |
Options outstanding, exercise price | $ 11.06 |
Options exercisable, number | shares | 88,750 |
Options exercisable, remaining term | 5 years 5 months 12 days |
Options exercisable, exercise price | $ 11.05 |
$11.16 - $11.26 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options exercise price, lower limit | 11.16 |
Options exercise price, upper limit | $ 11.26 |
Options outstanding, number | shares | 1,574,900 |
Options outstanding, remaining term | 9 years 2 months 1 day |
Options outstanding, exercise price | $ 11.26 |
Options exercisable, remaining term | 0 years |
$11.27 - $16.50 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options exercise price, lower limit | $ 11.27 |
Options exercise price, upper limit | $ 16.50 |
Options outstanding, number | shares | 1,283,110 |
Options outstanding, remaining term | 8 years 2 months 19 days |
Options outstanding, exercise price | $ 14.93 |
Options exercisable, number | shares | 719,738 |
Options exercisable, remaining term | 7 years 11 months 12 days |
Options exercisable, exercise price | $ 15.23 |
$16.51 - $19.75 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options exercise price, lower limit | 16.51 |
Options exercise price, upper limit | $ 19.75 |
Options outstanding, number | shares | 1,046,000 |
Options outstanding, remaining term | 8 years 8 months 8 days |
Options outstanding, exercise price | $ 17.62 |
Options exercisable, number | shares | 378,581 |
Options exercisable, remaining term | 8 years 1 month 13 days |
Options exercisable, exercise price | $ 17.33 |
$19.76 - $25.78 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options exercise price, lower limit | 19.76 |
Options exercise price, upper limit | $ 25.78 |
Options outstanding, number | shares | 994,800 |
Options outstanding, remaining term | 9 years 7 months 28 days |
Options outstanding, exercise price | $ 21.79 |
Options exercisable, remaining term | 0 years |
$25.79 - 117.00 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options exercise price, lower limit | $ 25.79 |
Options exercise price, upper limit | $ 117 |
Options outstanding, number | shares | 44,000 |
Options outstanding, remaining term | 8 years 3 months 11 days |
Options outstanding, exercise price | $ 42.15 |
Options exercisable, number | shares | 9,000 |
Options exercisable, remaining term | 1 year 8 months 23 days |
Options exercisable, exercise price | $ 99.12 |
STOCK BASED COMPENSATION - Addi
STOCK BASED COMPENSATION - Additional information (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 01, 2016 | Aug. 31, 2013 | Jul. 31, 2013 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Apr. 22, 2018 | Apr. 16, 2016 | Apr. 10, 2015 | Nov. 30, 2014 | Aug. 20, 2014 | Aug. 19, 2014 | Oct. 14, 2011 |
STOCK BASED COMPENSATION | |||||||||||||
Intrinsic value of options exercised | $ 5,300 | $ 2,300 | $ 2,600 | ||||||||||
Weighted average grant date fair value, options granted | $ 9.48 | $ 14.44 | $ 6.58 | ||||||||||
Share-based Compensation | $ 24,277 | $ 20,027 | $ 11,968 | ||||||||||
Restricted Common Stock | |||||||||||||
STOCK BASED COMPENSATION | |||||||||||||
Unvested shares | 0 | 0 | 0 | ||||||||||
Share-based Compensation | $ 0 | $ 0 | $ 0 | ||||||||||
Restricted stock units | |||||||||||||
STOCK BASED COMPENSATION | |||||||||||||
Stock-based compensation expense | $ 300 | 300 | 1,100 | ||||||||||
Unrecognized compensation cost recognition period | 5 months 1 day | ||||||||||||
Unrecognized compensation cost | $ 100 | ||||||||||||
Unvested shares | 22,916 | ||||||||||||
Restricted stock units | Chief Executive Officer | |||||||||||||
STOCK BASED COMPENSATION | |||||||||||||
Granted | 550,000 | ||||||||||||
Granted | $ 5.87 | ||||||||||||
Stock option | |||||||||||||
STOCK BASED COMPENSATION | |||||||||||||
Stock-based compensation expense | $ 24,000 | $ 19,800 | $ 10,900 | ||||||||||
Unrecognized compensation cost | $ 41,200 | ||||||||||||
Unrecognized compensation cost recognition period | 1 year 11 months 19 days | ||||||||||||
2011 Equity Incentive Plan | |||||||||||||
STOCK BASED COMPENSATION | |||||||||||||
Number of shares available | 151,240 | ||||||||||||
Common stock, capital shares reserved for future issuance | 1,700,000 | 1,900,000 | 1,700,000 | 180,000 | |||||||||
Maximum award per person per year (in shares) | 300,000 | 50,000 | |||||||||||
Equity Incentive Plan | |||||||||||||
STOCK BASED COMPENSATION | |||||||||||||
Shares authorized | 9,000,000 | 4,000,000 | 2,350,000 | ||||||||||
Number of shares available | 174,292 | ||||||||||||
The 2018 Plan | |||||||||||||
STOCK BASED COMPENSATION | |||||||||||||
Shares authorized | 6,000,000 | ||||||||||||
Number of shares available | 3,297,600 | ||||||||||||
Vesting on first anniversary | Restricted stock units | |||||||||||||
STOCK BASED COMPENSATION | |||||||||||||
Vested | (137,500) | ||||||||||||
Vesting on satisfaction of clinical trial milestones | Restricted stock units | |||||||||||||
STOCK BASED COMPENSATION | |||||||||||||
Vested | (275,000) | ||||||||||||
Vesting over period after first anniversary | Restricted stock units | |||||||||||||
STOCK BASED COMPENSATION | |||||||||||||
Vested | (137,500) | ||||||||||||
Vesting period | 36 months |
EMPLOYEE BENEFIT PLAN (Details)
EMPLOYEE BENEFIT PLAN (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
EMPLOYEE BENEFIT PLAN | |||
Defined Contribution Plan, Cost | $ 0.9 | $ 0.5 | $ 0.3 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred income tax asset: | ||
Net operating loss carry forward | $ 95,473 | $ 56,971 |
Stock-based compensation | 8,851 | 5,823 |
Tax credit carryforwards | 22,711 | 14,356 |
Lease liabilities | 2,529 | |
Depreciation and Amortization | 98 | |
Reserves and accruals | 1,410 | 1,049 |
Deferred tax assets before valuation allowance | 131,072 | 78,199 |
Less: valuation allowance | (128,720) | (78,146) |
Net deferred income tax assets | 2,352 | 53 |
Deferred tax liabilities: | ||
Depreciation and amortization | (2,352) | (53) |
Net deferred tax assets (liabilities) | $ 0 | $ 0 |
INCOME TAXES - Rate reconciliat
INCOME TAXES - Rate reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
INCOME TAXES | |||
Federal statutory tax rate | (21.00%) | (21.00%) | (34.00%) |
Orphan Drug & Research credits | (4.00%) | (3.00%) | |
Permanent and other differences | 1.00% | 1.00% | 4.00% |
Tax rate change | 23.00% | ||
State tax, net of federal benefit | (2.00%) | (1.00%) | |
Effective Income Tax Rate Reconciliation Expected Rate Total | (26.00%) | (24.00%) | (7.00%) |
Valuation allowance | 26.00% | 24.00% | 7.00% |
INCOME TAXES - Expense componen
INCOME TAXES - Expense components (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Federal: | |||
Current | $ 0 | $ 0 | $ 0 |
Deferred | (47,010) | (28,277) | (7,391) |
State and Local | |||
Current | 0 | 0 | 0 |
Deferred | (3,564) | (2,020) | 944 |
Change in Valuation Allowance | 50,574 | 30,297 | 6,447 |
Total income tax expense (benefit) | $ 0 | $ 0 | $ 0 |
INCOME TAXES - Unrecognized ben
INCOME TAXES - Unrecognized benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
INCOME TAXES | |||
Unrecognized benefit-beginning of period | $ 6,344 | $ 4,111 | $ 0 |
Gross decreases-prior period tax positions | 0 | 118 | 2,780 |
Gross increases-current period tax positions | 3,694 | 2,115 | 1,331 |
Unrecognized benefit-end of period | $ 10,038 | $ 6,344 | $ 4,111 |
INCOME TAXES - Other informatio
INCOME TAXES - Other information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Contingency [Line Items] | |||
Operating Loss Carry forwards Having Definite Expire life Value | $ 142,400,000 | ||
Operating Loss Carry forwards Having Indefinite Expire life Value | 284,400,000 | ||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 50,600,000 | $ 30,300,000 | $ 6,400,000 |
Interest or penalties on unpaid tax | 0 | $ 0 | $ 0 |
Domestic Tax Authority [Member] | |||
Income Tax Contingency [Line Items] | |||
Operating Loss Carryforwards | 426,800,000 | ||
State and Local Jurisdiction [Member] | |||
Income Tax Contingency [Line Items] | |||
Operating Loss Carryforwards | $ 128,500,000 |
LICENSES AND AGREEMENTS (Detail
LICENSES AND AGREEMENTS (Details) $ in Thousands | Jun. 28, 2014USD ($) | Apr. 30, 2017USD ($) | Dec. 31, 2016 | Nov. 30, 2016item | Aug. 31, 2016USD ($) | Dec. 31, 2015item | Aug. 31, 2011item | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | May 31, 2017USD ($) |
Research and development expenses | $ 166,023 | $ 99,828 | $ 71,615 | ||||||||
Strategic Alliance Agreement | |||||||||||
Research and development expenses | 3,400 | 800 | 0 | ||||||||
Prepaid expense, current | $ 1,400 | ||||||||||
Research Collaboration And Clinical Grant Agreement | |||||||||||
Research and development expenses | 700 | 1,200 | 1,200 | ||||||||
Maximum | Strategic Alliance Agreement | |||||||||||
Research and development arrangement, contract to perform for others, costs incurred, gross | $ 14,200 | ||||||||||
Cooperative Research and Development Agreement | |||||||||||
Research and development expenses | 2,200 | 2,000 | 2,000 | ||||||||
Agreement term | 5 years | 5 years | |||||||||
Number Of Indications Under Agreement | item | 4 | ||||||||||
Additional milestone payable | $ 500 | ||||||||||
Notification Period To Terminate Agreement | 60 days | ||||||||||
MedImmune | |||||||||||
Number Of Clinical Trials | item | 1 | ||||||||||
WuXi Apptech, Inc - Manufacturing and Services Agreement | |||||||||||
Research and development expenses | 28,400 | 15,100 | $ 13,900 | ||||||||
Agreement term | 3 years | ||||||||||
Number Of Statements Of Work | item | 2 | ||||||||||
Number Of Suites Under The Agreement | item | 2 | ||||||||||
WuXi Apptech, Inc - Manufacturing and Services Agreement | Manufacturing Suites | Maximum | |||||||||||
Payable For Each Dedicated Manufacturing Suites | 2,700 | ||||||||||
WuXi Apptech, Inc - Manufacturing and Services Agreement | Manufacturing Suites | Minimum | |||||||||||
Payable For Each Dedicated Manufacturing Suites | 1,200 | ||||||||||
Moffitt License Agreement Two | |||||||||||
Research and development expenses | 100 | 100 | |||||||||
Payments for upfront licensing fee | $ 100 | ||||||||||
Additional milestone payable | $ 400 | ||||||||||
Moffitt License Agreement One | |||||||||||
Agreement term | 20 years | ||||||||||
Payments for upfront licensing fee | $ 100 | ||||||||||
Research Collaboration And Clinical Grant Agreements With Moffitt | |||||||||||
Agreement term | 3 years |
LEASES - Company's right-of-use
LEASES - Company's right-of-use asset and lease liabilities (Details) $ in Thousands | Dec. 31, 2019USD ($) |
LEASES | |
Operating lease right-of-use assets | $ 10,695 |
Operating lease liabilities | |
Current portion included in current liabilities | 7,252 |
Long-term portion included in non-current liabilities | 4,248 |
Total operating lease liabilities | $ 11,500 |
LEASES - components of lease ex
LEASES - components of lease expenses (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
LEASES | |
Operating lease cost | $ 9,213 |
Variable lease cost | 5,801 |
Short-term lease cost | 72 |
Total lease cost | $ 15,086 |
LEASES - maturities of the Comp
LEASES - maturities of the Company's operating lease liabilities (Details) $ in Thousands | Dec. 31, 2019USD ($) |
2020 | $ 7,821 |
2021 | 3,608 |
2022 | 342 |
2023 | 269 |
2024 | 253 |
Total lease payments | 12,293 |
Less: Present value adjustment | (793) |
Operating lease liabilities | 11,500 |
Facility leases | |
2020 | 1,940 |
2021 | 968 |
2022 | 342 |
2023 | 269 |
2024 | 253 |
Total lease payments | 3,772 |
Less: Present value adjustment | (368) |
Operating lease liabilities | 3,404 |
CMO embedded leases | |
2020 | 5,881 |
2021 | 2,640 |
Total lease payments | 8,521 |
Less: Present value adjustment | (425) |
Operating lease liabilities | $ 8,096 |
LEASES - Additional information
LEASES - Additional information (Details) | Oct. 24, 2019USD ($) | Jun. 19, 2019USD ($)ft² | May 28, 2019USD ($)ft²item | May 01, 2019USD ($) | Nov. 02, 2018USD ($) | Oct. 19, 2018USD ($)ft² | Apr. 20, 2018USD ($) | Apr. 28, 2017USD ($)ft² | Aug. 04, 2016USD ($)ft² | Jul. 31, 2017USD ($) | Dec. 31, 2014ft² | Dec. 31, 2019USD ($) | May 02, 2019USD ($)ft² | Jan. 01, 2019USD ($) | Oct. 31, 2018ft² | Jun. 05, 2017USD ($) | Sep. 30, 2016USD ($)ft² | Apr. 30, 2015USD ($)ft² |
Term of contract (in years) | 12 months | |||||||||||||||||
Option to extend | option to extend | option to extend | ||||||||||||||||
Monthly lease payments | $ 12,293,000 | |||||||||||||||||
First year | 7,821,000 | |||||||||||||||||
Second year | 3,608,000 | |||||||||||||||||
Lease Expiration Term | 30 months | |||||||||||||||||
Monthly lease payments | 8,600,000 | |||||||||||||||||
Operating lease liabilities | 11,500,000 | |||||||||||||||||
Operating lease right-of-use assets | 10,695,000 | |||||||||||||||||
Increase in operating lease right-of-use assets | 7,800,000 | |||||||||||||||||
Increase in operating lease liability | $ 8,900,000 | |||||||||||||||||
Weighted average remaining lease term (in years) | 1 year 8 months 26 days | |||||||||||||||||
Weighted average discount rate (as a percent) | 7.70% | |||||||||||||||||
Finance lease term for not yet commenced (in years) | 20 years | |||||||||||||||||
Tampa Lease | ||||||||||||||||||
Term of contract (in years) | 5 years | |||||||||||||||||
Renewal term (in months) | 5 years | |||||||||||||||||
Monthly lease payments | $ 20,000 | $ 20,500 | ||||||||||||||||
Area of Land | ft² | 5,115 | 8,673 | 6,043 | |||||||||||||||
New York Lease | ||||||||||||||||||
Operating Leases, Rent Expense | $ 4,000 | $ 4,000 | $ 4,000 | |||||||||||||||
New York Lease | Office Space | ||||||||||||||||||
Monthly lease payments | $ 9,000 | |||||||||||||||||
Operating Leases, Rent Expense, Minimum Rentals | $ 18,000 | |||||||||||||||||
Operating Leases, Rent Expense | $ 7,000 | |||||||||||||||||
Teradata US, Inc | ||||||||||||||||||
Area of Land | ft² | 11,449 | |||||||||||||||||
San Carlos Lease | ||||||||||||||||||
Additional space of lease | ft² | 8,110 | |||||||||||||||||
First year | $ 39,000 | |||||||||||||||||
Second year | $ 40,000 | |||||||||||||||||
Operating Leases of Lessee, Contingent Rentals, Basis Spread on Variable Rate | 3.00% | |||||||||||||||||
San Carlos Lease | Land | ||||||||||||||||||
Monthly lease payments | $ 59,000 | $ 26,000 | $ 38,000 | |||||||||||||||
Lease Expiration Term | 54 months | |||||||||||||||||
Operating Leases, Rent Expense, Minimum Rentals | $ 26,000 | |||||||||||||||||
Area of Land | ft² | 12,322 | 8,733 | 11,449 | |||||||||||||||
San Carlos Lease | Office Space | ||||||||||||||||||
Area of Land | ft² | 20,432 | |||||||||||||||||
Philadelphia Office Lease for first year | Office Space | ||||||||||||||||||
Monthly lease payments | $ 2,000 | |||||||||||||||||
Area of Land | ft² | 1,500 | |||||||||||||||||
Philadelphia Office Lease for next three Years | ||||||||||||||||||
Operating Leases of Lessee, Contingent Rentals, Basis Spread on Variable Rate | 2.50% | |||||||||||||||||
Philadelphia Office Lease for next three Years | Office Space | ||||||||||||||||||
Monthly lease payments | $ 11,063 | |||||||||||||||||
Area of Land | ft² | 4,500 | |||||||||||||||||
Commercial Manufacturing Facility Agreement | ||||||||||||||||||
Term of contract (in years) | 242 months | |||||||||||||||||
Renewal term (in months) | 359 months | |||||||||||||||||
Monthly lease payments | $ 320,000 | |||||||||||||||||
Number of phases | item | 2 | |||||||||||||||||
Prior written notice period (in months) | 18 months | |||||||||||||||||
Minimum annual increase in basis spread on variable rate (as a percent) | 2.00% | |||||||||||||||||
Maximum annual increase in basis spread on variable rate (as a percent) | 75.00% | |||||||||||||||||
Operating expenses | $ 53,000 | |||||||||||||||||
Operating Leases of Lessee, Contingent Rentals, Basis Spread on Variable Rate | 2.00% | |||||||||||||||||
Commercial Manufacturing Facility Agreement | Office Space | ||||||||||||||||||
Area of Land | ft² | 136,000 | |||||||||||||||||
Commercial Manufacturing Facility Agreement for Phase I-A | ||||||||||||||||||
Term of Phase I-A | 160 days | |||||||||||||||||
Commercial Manufacturing Facility Agreement for Phase I-A | Office Space | ||||||||||||||||||
Area of Land | ft² | 66,000 | |||||||||||||||||
Commercial Manufacturing Facility Agreement for Phase I-B | Office Space | ||||||||||||||||||
Area of Land | ft² | 70,000 | |||||||||||||||||
ASU 2016-02 | ||||||||||||||||||
Operating lease liabilities | $ 10,700,000 | |||||||||||||||||
Operating lease right-of-use assets | $ 10,400,000 |
LEGAL PROCEEDINGS (Details)
LEGAL PROCEEDINGS (Details) | Jul. 05, 2018item | Feb. 05, 2018item | Jun. 13, 2017USD ($)shares | Apr. 14, 2017item | Jun. 03, 2016USD ($) | Mar. 31, 2013 | Nov. 30, 2012USD ($) | Jun. 30, 2012USD ($) | Jun. 30, 2016shares | Dec. 31, 2019shares | Dec. 31, 2018shares | Dec. 31, 2017shares | Sep. 28, 2018USD ($) | Apr. 08, 2016USD ($) |
Damages claimed | $ | $ 500,000 | |||||||||||||
Common stock registered for resale | 128,500 | |||||||||||||
Number of share options or share units exercised during the current period. | 128,500 | |||||||||||||
Class Action Suits Alleging Violation Of Federal Securities Laws | ||||||||||||||
Loss Contingency, Number of Defendants | item | 3 | |||||||||||||
Loss Contingency, Claims Dismissed, Number | item | 2 | |||||||||||||
Loss Contingency, Pending Claims, Number | item | 6 | |||||||||||||
Estimate of possible loss | $ | $ 0 | |||||||||||||
Solomon Capital LLC Litigation | ||||||||||||||
Proceeds from related party debt | $ | $ 100,000 | $ 200,000 | ||||||||||||
Debt instrument, convertible, number of equity instruments | 1,110 | |||||||||||||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 0.01 | |||||||||||||
Twenty Eleven Equity Incentive Plan | ||||||||||||||
Common stock issued upon exercise of stock options (in shares) | 200,000 | |||||||||||||
Steven Fischkoff | ||||||||||||||
Loss Contingency, Claims Dismissed, Number | item | 2 | |||||||||||||
Issued | 150,000 | |||||||||||||
Severance pay and retention bonus | $ | $ 300,000 | |||||||||||||
Warrant | ||||||||||||||
Shares sold under ineffective registration | 128,500 | |||||||||||||
Issued | 0 | 0 | ||||||||||||
Common stock issued upon exercise of stock options (in shares) | 6,301,216 | 265,000 | ||||||||||||
Minimum | ||||||||||||||
Estimate of possible loss | $ | $ 1,500,000 | |||||||||||||
Commercial Paper | Solomon Capital LLC Litigation | ||||||||||||||
Face amount | $ | $ 200,000 |
QUARTERLY UNAUDITED RESULTS (De
QUARTERLY UNAUDITED RESULTS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
QUARTERLY UNAUDITED RESULTS | |||||||||||
Net Loss | $ (63,568) | $ (49,487) | $ (47,551) | $ (36,950) | $ (32,575) | $ (33,830) | $ (30,660) | $ (26,515) | $ (197,556) | $ (123,580) | $ (92,064) |
Net loss per share, basic and diluted | $ (0.50) | $ (0.40) | $ (0.38) | $ (0.30) | $ (0.27) | $ (0.36) | $ (0.34) | $ (0.31) | $ (1.59) | $ (1.27) | $ (1.41) |
Weighted average share used in computing net loss per share, basic and diluted | 126,273 | 124,035 | 123,567 | 123,415 | 119,085 | 95,077 | 90,236 | 84,350 | 124,336 | 97,277 | 65,242 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Sep. 14, 2017 | Sep. 14, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Payments for Legal Services | $ 400 | $ 500 | $ 700 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Terms of Award | The granted stock options vest in 12 quarterly installments (with 1/12th of the option shares having vested on the date of grant). | ||||
Share-based Compensation | 24,277 | 20,027 | 11,968 | ||
Consulting Agreement | |||||
Share-based Compensation | $ 400 | $ 700 | $ 200 | ||
Board of Directors Chairman | |||||
Term of consulting agreement (in years) | 3 years | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 150 | 150 | |||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 7.30 | ||||
Vesting period | 3 years |