Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 10, 2022 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2022 | |
Entity File Number | 001-37990 | |
Entity Address, Address Line One | 47 Thorndike St, Suite B1-1 | |
Entity Address, City or Town | Cambridge | |
Entity Address, Postal Zip Code | 02141 | |
Entity Address, State or Province | MA | |
Entity Incorporation, State or Country Code | DE | |
City Area Code | (617) | |
Local Phone Number | 714-0360 | |
Entity Tax Identification Number | 27-4412575 | |
Entity Registrant Name | LEAP THERAPEUTICS, INC. | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | LPTX | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 88,318,454 | |
Entity Central Index Key | 0001509745 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 103,220 | $ 114,916 |
Research and development incentive receivable | 1,233 | 1,189 |
Prepaid expenses and other current assets | 491 | 769 |
Total current assets | 104,944 | 116,874 |
Property and equipment, net | 32 | 36 |
Right of use assets, net | 355 | 459 |
Research and development incentive receivable, net of current portion | 38 | |
Deferred tax assets | 164 | 159 |
Other long term assets | 75 | 90 |
Deposits | 293 | 293 |
Total assets | 105,901 | 117,911 |
Current liabilities: | ||
Accounts payable | 4,287 | 4,189 |
Accrued expenses | 2,694 | 5,366 |
Lease liability - current portion | 363 | 432 |
Total current liabilities | 7,344 | 9,987 |
Non current liabilities: | ||
Lease liability, net of current portion | 37 | |
Total liabilities | 7,344 | 10,024 |
Stockholders' equity: | ||
Common stock, $0.001 par value; 240,000,000 shares authorized; 88,318,454 shares issued and outstanding as of March 31, 2022 and December 31, 2021 | 88 | 88 |
Additional paid-in capital | 372,842 | 371,638 |
Accumulated other comprehensive loss | (425) | (267) |
Accumulated deficit | (273,948) | (263,572) |
Total stockholders' equity | 98,557 | 107,887 |
Total liabilities and stockholders' equity | $ 105,901 | $ 117,911 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized shares | 240,000,000 | 240,000,000 |
Common stock, issued shares | 88,318,454 | 88,318,454 |
Common stock, outstanding shares | 88,318,454 | 88,318,454 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
License revenue | $ 375 | |
Operating expenses: | ||
Research and development | $ 7,784 | 6,807 |
General and administrative | 2,848 | 2,740 |
Total operating expenses | 10,632 | 9,547 |
Loss from operations | (10,632) | (9,172) |
Interest income | 5 | 2 |
Interest expense | (21) | (14) |
Australian research and development incentives | 37 | 71 |
Foreign currency gain (loss) | 235 | (21) |
Net loss | (10,376) | (9,134) |
Net loss attributable to common stockholders | $ (10,376) | $ (9,134) |
Net loss per share | ||
Basic (in dollars per share) | $ (0.09) | $ (0.12) |
Diluted (in dollars per share) | $ (0.09) | $ (0.12) |
Weighted average common shares outstanding | ||
Basic (in shares) | 113,248,937 | 76,378,569 |
Diluted (in shares) | 113,248,937 | 76,378,569 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS | ||
Net loss | $ (10,376) | $ (9,134) |
Other comprehensive income (loss): | ||
Foreign currency translation adjustments | (158) | 15 |
Comprehensive loss | $ (10,534) | $ (9,119) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENT OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock. | Additional Paid-in Capital. | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total |
Balance at the beginning of the period (in shares) at Dec. 31, 2020 | 59,657,742 | ||||
Increase (Decrease) in Shares Outstanding | |||||
Issuance of common stock upon exercise of warrant (in shares) | 11,980 | ||||
Balance at the end of the period (in shares) at Mar. 31, 2021 | 59,669,722 | ||||
Balance at the beginning of the period at Dec. 31, 2020 | $ 60 | $ 270,155 | $ (579) | $ (222,985) | $ 46,651 |
Increase (Decrease) in Stockholders' Equity | |||||
Issuance of common stock upon exercise of warrants | 14 | 14 | |||
Foreign currency translation adjustment | 15 | 15 | |||
Stock-based compensation | 833 | 833 | |||
Net loss | (9,134) | (9,134) | |||
Balance at the end of the period at Mar. 31, 2021 | $ 60 | 271,002 | (564) | (232,119) | 38,379 |
Balance at the beginning of the period (in shares) at Dec. 31, 2021 | 88,318,454 | ||||
Balance at the end of the period (in shares) at Mar. 31, 2022 | 88,318,454 | ||||
Balance at the beginning of the period at Dec. 31, 2021 | $ 88 | 371,638 | (267) | (263,572) | 107,887 |
Increase (Decrease) in Stockholders' Equity | |||||
Foreign currency translation adjustment | (158) | (158) | |||
Stock-based compensation | 1,204 | 1,204 | |||
Net loss | (10,376) | (10,376) | |||
Balance at the end of the period at Mar. 31, 2022 | $ 88 | $ 372,842 | $ (425) | $ (273,948) | $ 98,557 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (10,376) | $ (9,134) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation expense | 4 | 7 |
Amortization of contract asset | 34 | |
Change in right-of-use asset | 104 | 95 |
Stock-based compensation expense | 1,204 | 833 |
Foreign currency (gain) loss | (235) | 21 |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other assets | 277 | (133) |
Research and development incentive receivable | (38) | (20) |
Accounts payable and accrued expenses | (2,368) | 387 |
Deferred revenue | (375) | |
Restricted stock liability | (204) | |
Lease liability | (106) | (98) |
Other assets | 16 | |
Net cash used in operating activities | (11,518) | (8,587) |
Cash flows from financing activities: | ||
Proceeds from the exercise of common stock warrants | 14 | |
Payment of deferred offering costs | (210) | |
Net cash provided by (used in) financing activities | (210) | 14 |
Effect of exchange rate changes on cash and cash equivalents | 32 | (7) |
Net decrease in cash and cash equivalents | (11,696) | (8,580) |
Cash and cash equivalents at beginning of period | 114,916 | 52,071 |
Cash and cash equivalents at end of period | $ 103,220 | $ 43,491 |
Nature of Business, Basis of Pr
Nature of Business, Basis of Presentation and Liquidity | 3 Months Ended |
Mar. 31, 2022 | |
Nature of Business, Basis of Presentation and Liquidity | |
Nature of Business, Basis of Presentation and Liquidity | 1. Nature of Business, Basis of Presentation and Liquidity Nature of Business Leap Therapeutics, Inc. was incorporated in the state of Delaware on January 3, 2011. During 2015, HealthCare Pharmaceuticals Pty Ltd. (“HCP Australia”) was formed and is a wholly owned subsidiary of the Company. On December 15, 2021, Leap Securities Corp. was formed and is a wholly owned subsidiary of the Company. The Company is a biopharmaceutical company acquiring and developing novel therapeutics at the leading edge of cancer biology. The Company’s approach is designed to target compelling tumor-promoting and immuno-oncology pathways to generate durable clinical benefit and enhanced outcomes for patients. The Company’s programs are monoclonal antibodies that target key cellular pathways that enable cancer to grow and spread and specific mechanisms that activate the body’s immune system to identify and attack cancer. Basis of Presentation The accompanying condensed consolidated financial statements as of March 31, 2022 and for the three months ended March 31, 2022 and 2021 have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. However, the Company believes that the disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 11, 2022. The condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements. In the opinion of management, the accompanying condensed consolidated financial statements contain all adjustments which are necessary for the fair presentation of the Company’s financial position as of March 31, 2022, statements of operations and statements of comprehensive loss for the three months ended March 31, 2022 and 2021 and statements of cash flows for the three months ended March 31, 2022 and 2021. Such adjustments are of a normal and recurring nature. The results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2022. Liquidity Since inception, the Company has been engaged in organizational activities, including raising capital, and research and development activities. The Company does not yet have a product that has been approved by the Food and Drug Administration (the “FDA”), has not generated any product sales revenues and has not yet achieved profitable operations, nor has it ever generated positive cash flows from operations. There is no assurance that profitable operations, if achieved, could be sustained on a continuing basis. Further, the Company’s future operations are dependent on the success of the Company’s efforts to raise additional capital, its research and commercialization efforts, regulatory approval, and, ultimately, the market acceptance of the Company’s products. In accordance with Accounting Standards Codification (“ASC”) 205-40, Going Concern, the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the condensed consolidated financial statements are issued. As of March 31, 2022, the Company had cash and cash equivalents of $103,220. Additionally, the Company had an accumulated deficit of $273,948 at March 31, 2022, and during the three months ended March 31, 2022, the Company incurred a net loss of $10,376. The Company expects to continue to generate operating losses for the foreseeable future. The Company believes that its cash and cash equivalents of $103,220 as of March 31, 2022 will be sufficient to fund its operating expenses for at least the next 12 months from issuance of these financial statements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions are eliminated upon consolidation. Use of Estimates The presentation of condensed consolidated financial statements in conformity with 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 condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Research and development incentive income and receivable The Company recognizes other income from Australian research and development incentives when there is reasonable assurance that the income will be received, the relevant expenditure has been incurred, and the consideration can be reliably measured. The research and development incentive is one of the key elements of the Australian Government’s support for Australia’s innovation system and is supported by legislative law primarily in the form of the Australian Income Tax Assessment Act 1997, as long as eligibility criteria are met. Management has assessed the Company’s research and development activities and expenditures to determine which activities and expenditures are likely to be eligible under the research and development incentive regime described above. At each period end, management estimates the refundable tax offset available to the Company based on available information at the time. Under the program, a percentage of eligible research and development expenses incurred by the Company through its subsidiary in Australia are reimbursed. The percentage was 43.5% for the year ended December 31, 2021 and for the three months ended March 31, 2022. The research and development incentive receivable represents an amount due in connection with the above program. The Company recorded a research and development incentive receivable of $1,271 and $1,189 as of March 31, 2022 and December 31, 2021, respectively, in the condensed consolidated balance sheets and other income from Australian research and development incentives of $37 and $71, respectively, for the three months ended March 31, 2022 and 2021. The following table shows the change in the research and development incentive receivable from January 1, 2021 to March 31, 2022 (in thousands): Balance at January 1, 2021 73 Australian research and development incentive income, net 1,226 Cash received for 2020 eligible expenses (111) Foreign currency translation 1 Balance at December 31, 2021 $ 1,189 Australian research and development incentive income, net 37 Foreign currency translation 45 Balance at March 31, 2022 $ 1,271 Foreign Currency Translation The financial statements of the Company’s Australian subsidiary are measured using the local currency as the functional currency. Assets and liabilities of this subsidiary are translated into U.S. dollars at an exchange rate as of the consolidated balance sheet date. Equity is translated at historical exchange rates. Revenues and expenses are translated into U.S. dollars at average rates of exchange in effect during the period. The resulting cumulative translation adjustments have been recorded as a separate component of stockholders’ equity. Realized and unrealized foreign currency transaction gains and losses are included in the results of operations. Deposits As of March 31, 2022 and December 31, 2021, there were $293 of deposits made by the Company with certain service providers that are to be applied to future payments due under the service agreements or returned to the Company if not utilized which were recorded in the condensed consolidated balance sheets. Warrants The Company will recognize on a prospective basis the value of the effect of the down round feature in the warrants to purchase shares of common stock that were issued in a private placement in November 2017 (the “2017 Warrants”) when it is triggered (i.e., when the exercise price is adjusted downward). This value is measured as the difference between (1) the financial instrument’s fair value (without the down round feature) using the pre-trigger exercise price and (2) the financial instrument’s fair value (with the down round feature) using the reduced exercise price. The value of the effect of the down round feature will be treated as a dividend and a reduction to income available to common stockholders in the basic EPS calculation. Fair Value of Financial Instruments Certain assets and liabilities are carried at fair value under GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: ● Level 1—Quoted prices in active markets for identical assets or liabilities. ● Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data. ● Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. During the periods presented, the Company did not change the manner in which it values assets and liabilities that are measured at fair value using Level 3 inputs. There were no transfers within the hierarchy during the three months ended March 31, 2022 or the year ended December 31, 2021. A summary of the assets and liabilities carried at fair value in accordance with the hierarchy defined above is as follows (in thousands): Total Level 1 Level 2 Level 3 March 31, 2022 Assets: Cash equivalents $ 101,004 $ 101,004 $ — $ — Total assets $ 101,004 $ 101,004 $ — $ — December 31, 2021 Assets: Cash equivalents $ 112,726 $ 112,726 $ — $ — Total assets $ 112,726 $ 112,726 $ — $ — Cash equivalents of $101,004 and $112,726 as of March 31, 2022 and December 31, 2021, respectively, consisted of overnight investments and money market funds and are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices in active markets. The carrying values of the research and development incentive receivable, accounts payable and accrued liabilities approximate their fair value due to the short-term nature of these assets and liabilities. Leases The Company accounts for leases in accordance with Accounting Standards Codification, or ASC, Topic 842, Leases At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present. Most leases with a term greater than one year are recognized on the balance sheet as right-of-use assets, lease liabilities and, if applicable, long-term lease liabilities. The Company has elected not to recognize on the balance sheet leases with terms of one year or less. Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over the expected remaining lease term. The Company has determined that the rate implicit in the lease is not determinable and the Company does not have borrowings with similar terms and collateral. Therefore, the Company considered a variety of factors, including observable debt yields from comparable companies and the volatility in the debt market for securities with similar terms, in determining that 8% was reasonable to use as the incremental borrowing rate for purposes of the calculation of lease liabilities. In accordance with the guidance in Topic 842, components of a lease should be split into three categories: lease components (e.g. land, building, etc.), non-lease components (e.g. common area maintenance, maintenance, consumables, etc.), and non-components (e.g. property taxes, insurance, etc.). Then the fixed and in-substance fixed contract consideration (including any related to non-components) must be allocated based on fair values to the lease components and non-lease components. Although separation of lease and non-lease components is required, certain practical expedients are available. Entities may elect the practical expedient to not separate lease and non-lease components. Rather, they would account for each lease component and the related non-lease component together as a single component. The Company has elected to account for the lease and non-lease components of each of its operating leases as a single lease component and allocate all of the contract consideration to the lease component only. The lease component results in an operating right-of-use asset being recorded on the consolidated balance sheets and amortized such that lease expense is recorded on a straight line basis over the term of the lease. Revenue Recognition The Company records revenue in accordance with ASC Topic 606, Revenue From Contracts with Customers. License revenue. Research and Development Services. Customer Options. Milestone Payments. Royalties Collaborative Arrangements The Company analyzes its collaboration arrangements to assess whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards dependent on the commercial success of such activities and therefore within the scope of ASC Topic 808, Collaborative Arrangements (ASC 808). This assessment is performed throughout the life of the arrangement based on changes in the responsibilities of all parties in the arrangement. For collaboration arrangements within the scope of ASC 808 that contain multiple elements, the Company first determines which elements of the collaboration are deemed to be within the scope of ASC 808 and which elements of the collaboration are more reflective of a vendor-customer relationship and therefore within the scope of ASC 606. For elements of collaboration arrangements that are accounted for pursuant to ASC 808, an appropriate recognition method is determined and applied consistently, generally by analogy to ASC 606. Amounts that are owed to collaboration partners are recognized as an offset to collaboration revenues as such amounts are incurred by the collaboration partner. Where amounts owed to a collaboration partner exceed the Company’s collaboration revenues in each quarterly period, such amounts are classified as research and development expense. Reimbursements from and payments to the customer that are the result of a collaborative relationship with a partner, instead of a customer relationship, such as co-development activities, are recorded as a reduction to research and development expense. For those elements of the arrangement that are accounted for pursuant to ASC 606, the Company applies the five-step model described above under ASC 606. See Note 3 for a complete discussion of the revenue recognition for the Company’s license agreement. Net Loss per Share Basic net loss per share is computed using the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed using the weighted average number of common shares outstanding during the period and, if dilutive, the weighted average number of potential shares of common stock, including the assumed exercise of stock options and warrants. Subsequent Events The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. Recent Accounting Pronouncements For a discussion of recent accounting pronouncements please refer to Note 2, “Summary of Significant Accounting Policies”, in the Company’s previously filed Annual Report on Form 10-K for the year ended December 31, 2021. |
BeiGene Exclusive Option and Li
BeiGene Exclusive Option and License Agreement | 3 Months Ended |
Mar. 31, 2022 | |
BeiGene Exclusive Option and License Agreement | |
BeiGene Exclusive Option and License Agreement | 3. BeiGene Exclusive Option and License Agreement Terms of Agreement On January 3, 2020, the Company entered into an exclusive option and license agreement (the “ BeiGene Agreement”) with BeiGene, Ltd. ( “ BeiGene”) for the clinical development and commercialization of DKN-01, in Asia (excluding Japan), Australia, and New Zealand. The Company retains exclusive rights for the development, manufacturing, and commercialization of DKN-01 for the rest of the world. Pursuant to the BeiGene Agreement, the Company received an upfront cash payment of $3,000 from BeiGene in exchange for granting BeiGene an option to an exclusive license to develop and commercialize DKN-01 in Asia (excluding Japan), Australia, and New Zealand. The Company is eligible to receive up to $132,000 in future option exercise and milestone payments, based upon the achievement of certain development, regulatory, and sales milestones, as well as tiered royalties on any product sales of DKN-01 in the licensed territory. The Company is responsible for conducting development activities prior to the exercise of the option. After the option is exercised, BeiGene is solely responsible for the development and commercialization of DKN-01 in the territory. The BeiGene Agreement continues in effect until the earlier of: (i) 120 days after the end of the option period, if BeiGene has not exercised the option by such date; and (ii) on a country-by country and Licensed Product-by-Licensed Product (as defined in the BeiGene Agreement) basis, the expiration of the Royalty Term (as defined in the BeiGene Agreement) applicable to such licensed product in such country. At any time, BeiGene may terminate the BeiGene Agreement by providing at least 60 days written notice of termination to the Company. Upon termination of the License Agreement, all rights granted by the Company to BeiGene terminate. Revenue Recognition The Company evaluated the BeiGene Agreement to determine whether it is a collaborative arrangement for purposes of ASC 808. The Company concluded that because both parties were active participants and were exposed to the risks and rewards of the BeiGene Agreement, that such activities are under the scope of ASC 808. The Company concluded that BeiGene was a customer with regard to the combined license and research and development activities and as such the contract should be evaluated under ASC 606. In determining the appropriate amount of revenue to be recognized under ASC 606 as the Company fulfills its obligations under the BeiGene Agreement, the Company performs the following steps: (i) identifies the promised goods or services in the contract; (ii) determines whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract; (iii) measures the transaction price, including any constraints on variable consideration; (iv) allocates the transaction price to the performance obligations; and (v) recognizes revenue when (or as) the Company satisfies each performance obligation. The Company identified the following material promises under the BeiGene Agreement: (1) option to an exclusive license to develop and commercialize DKN-01 in Asia (excluding Japan), Australia, and New Zealand, (2) participation in a joint development committee, (3) technology transfer services and (4) pre-option research and development services. The Company determined that the option to an exclusive license in the territory does not represent a material right. Additionally, the Company determined that the participation in the joint development committee, research and development services and technology transfer services are not distinct from each other, as each has limited value without the other. As such, for the purposes of ASC 606, the Company determined that these four material promises, described above, should be combined into a single performance obligation. The Company determined the transaction price was equal to the up-front fee of $3,000 . The transaction price was fully allocated to the single performance obligation and was recognized as revenue on a straight-line basis over the performance period of the research and development services. During the three months ended March 31, 2021, the Company recognized $375 of license revenue related to the up-front fee received from BeiGene. During the three months ended March 31, 2022, the Company did no t recognize any such revenue as the upfront payment was fully recognized as of December 31, 2021. Cost of contract acquisition The Company incurred contract acquisition costs of $270 which were capitalized under ASC 340-40 as incremental costs of obtaining the contract with BeiGene. This cost was amortized on a straight-line basis over the performance period of the research and development services. The total amount of amortization expense during the three months ended March 31, 2021 was $34. During the three months ended March 31, 2022, the Company did not recognize any such amortization expense as the contract acquisition costs were fully amortized as of December 31, 2021. Royalties As the license is deemed to be the predominant item to which sales-based royalties relate, the Company will recognize revenue when the related sales occur. No royalty revenue was recognized during the three months ended March 31, 2022 and 2021. The following table presents a summary of the activity in the Company’s contract liabilities, related to the upfront cash payment received of $3,000 , from January 1, 2021 through March 31, 2022 (in thousands): Balance at January 1, 2021 $ 1,500 Deductions (1,500) Balance at December 31, 2021 $ — |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Mar. 31, 2022 | |
Accrued Expenses | |
Accrued Expenses | 4. Accrued Expenses Accrued expenses consist of the following: March 31, December 31, 2022 2021 Clinical trials $ 1,915 $ 2,499 Professional fees 110 181 Payroll and related expenses 669 2,686 Accrued expenses $ 2,694 $ 5,366 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2022 | |
Leases | |
Leases | 5. Leases The Company has operating leases for real estate in the United States and does not have any finance leases. The Company’s leases may contain options to renew and extend lease terms and options to terminate leases early. Reflected in the right-of-use asset and lease liability on the Company’s consolidated balance sheets are the periods provided by renewal and extension options that the Company is reasonably certain to exercise, as well as the periods provided by termination options that the Company is reasonably certain to not exercise. The Company’s existing lease includes variable lease and non-lease components that are not included in the right-of-use asset and lease liability and are reflected as an expense in the period incurred. Such payments primarily include common area maintenance charges and increases in rent payments that are driven by factors such as future changes in an index (e.g., the Consumer Price Index). In calculating the present value of future lease payments, the Company utilized its incremental borrowing rate based on the remaining lease term at the date of adoption. The Company has elected to account for each lease component and its associated non-lease components as a single lease component and has allocated all of the contract consideration across lease components only. This will potentially result in the initial and subsequent measurement of the balances of the right-of-use asset and lease liability for leases being greater than if the policy election was not applied. The Company has existing net leases in which the non-lease components (e.g. common area maintenance, maintenance, consumables, etc.) are paid separately from rent based on actual costs incurred and therefore are not included in the right-of-use asset and lease liability and are reflected as an expense in the period incurred. As of March 31, 2022, a right-of-use asset of $ 355 and lease liability of $363 are reflected on the condensed consolidated balance sheets. The Company recorded rent expense of $108 , and $ 105 , during the three months ended March 31, 2022 and 2021, respectively. Future lease payments under non-cancelable operating leases as of March 31, 2022 are detailed as follows: Future Operating Lease Payments 2022 $ 333 2023 37 Total Lease Payments 370 Less: imputed interest (7) Total operating lease liabilities $ 363 |
Warrants
Warrants | 3 Months Ended |
Mar. 31, 2022 | |
Warrants | |
Warrants | 6. Warrants As of March 31, 2022, outstanding warrants to purchase common stock, all of which are classified as equity warrants, consisted of the following: March 31, 2022 Number of Shares Description Issuable Exercise Price Expiration Date January 23 2017 Warrants 54,516 $ 0.01 Upon M&A Event 2017 Warrants 2,502,382 $ 1.055 November 2024 2019 Warrants 7,008,257 $ 1.95 February 2026 March 2020 14,413,902 $ 0.001 No Expiry March 2020 25,945,035 $ 2.11 Jan - March 2027 June 2020 1,690,137 $ 0.001 No Expiry September 2021 8,771,928 $ 0.001 No Expiry 60,386,157 2017 Warrants The 2017 Warrants contain full ratchet anti-dilution protection provisions. The Company will recognize on a prospective basis the value of the effect of the down round feature in the 2017 Warrants when it is triggered (i.e., when the exercise price is adjusted downward). This value is measured as the difference between (1) the financial instrument’s fair value (without the down round feature) using the pre-trigger exercise price and (2) the financial instrument’s fair value (with the down round feature) using the reduced exercise price. The value of the effect of the down round feature will be treated as a dividend and a reduction to income available to common stockholders in the basic EPS calculation. 2019 Warrants On February 5, 2019, in connection with the 2019 Public Offering, the Company issued immediately exercisable warrants (the “2019 Warrants”) to purchase 7,557,142 shares of common stock to investors. The 2019 Warrants have an exercise price of $1.95 per share and expire on February 5, 2026. The 2019 Warrants qualify for equity classification. March 2020 Warrants On January 3, 2020, the Company entered into a Securities Purchase Agreement with investors, providing for a private placement transaction exempt from the Securities Act of 1933, as amended, pursuant to which the Company issued and sold 1,421,801 shares of its Series A Preferred Stock, at a purchase price of $10.54 per share, and 1,137,442 shares of its Series B Preferred Stock at a purchase price of $10.55 per share, and one (1) share of the Company’s Special Voting Stock entitling the purchaser of Series A Preferred Stock to elect one member of the Company’s board of directors. On March 5, 2020, the Company’s stockholders approved the conversion of the Series A Preferred Stock into a pre-funded warrant to purchase 14,413,902 shares of common stock at an exercise price of $0.001 (the “March 2020 Pre-funded Warrants”) and the conversion of the Series B Preferred Stock into 11,531,133 shares of common stock. Each investor also received a warrant to purchase an equal number of shares of common stock at an exercise price of $2.11 per share (the “Coverage Warrants”). The March 2020 Pre-funded Warrants and the Coverage Warrants qualify for equity classification. June 2020 Warrants On June 22, 2020, the Company completed a public offering (the “2020 Public Offering”) whereby the Company issued 20,250,000 shares of its common stock, at $2.00 per share and, in lieu of common stock, offered pre-funded warrants (the “June 2020 Pre-funded Warrants”) to purchase up to 2,250,000 shares of its common stock to certain investors. The June 2020 Pre-funded Warrants have an exercise price of $0.001 per share and qualify for equity classification. September 2021 Warrants On September 24, 2021, the Company completed a public offering (the ”2021 Public Offering”) whereby the Company issued 27,568,072 shares of its common stock, at $2.85 per share and, in lieu of common stock, offered pre-funded warrants (the “September 2021 Pre-funded Warrants”) to purchase up to 8,771,928 shares of its common stock to certain investors. The September 2021 Pre-funded Warrants have an exercise price of $0.001 per share and qualify for equity classification. |
Common Stock
Common Stock | 3 Months Ended |
Mar. 31, 2022 | |
Common Stock | |
Common Stock | 7. Common Stock Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders. Common stockholders are entitled to receive dividends, as may be declared by the board of directors, if any, subject to the preferential dividend rights of the preferred stockholders. Through March 31, 2022, no dividends have been declared for shares of common stock. Public Offering of Common Stock – September 2021 On September 24, 2021, the Company completed the 2021 Public Offering, whereby the Company issued 22,828,072 shares of its common stock at $2.85 per share and, in lieu of common stock, issued certain investors 8,771,928 of its September 2021 Pre-funded Warrants. The September 2021 Pre-funded Warrants have an exercise price of $0.001 per share and qualify for equity classification. The underwriters exercised their right to purchase 4,740,000 additional shares of the Company’s common stock at the public offering price per share of common stock, less underwriting discounts and commissions. The aggregate net proceeds received by the Company from the 2021 Public Offering were approximately $96,828 net of underwriting discounts and commissions and offering expenses payable by the Company. |
Equity Incentive Plans
Equity Incentive Plans | 3 Months Ended |
Mar. 31, 2022 | |
Equity Incentive Plans | |
Equity Incentive Plans | 8. Equity Incentive Plans Equity Incentive Plans In September 2012, the Company adopted the 2012 Equity Incentive Plan, as amended, which provides designated employees of the Company and its affiliates, certain consultants and advisors who perform services for the Company and its affiliates, and nonemployee members of the board of directors of the Company and its affiliates with the opportunity to receive grants of incentive stock options, nonqualified stock options and stock awards. On January 20, 2017, the Company’s stockholders approved the 2016 Equity Incentive Plan (the “2016 Plan”). Beginning on January 1, 2018, the number of shares of common stock authorized for issuance pursuant to the 2016 Plan was increased each January 1 by an amount equal to four percent (4%) of the Company’s outstanding common stock as of the end of the immediately preceding calendar year or such other amount as determined by the compensation committee of the Company’s board of directors. As of March 31, 2022, there were 791,745 shares available for grant under the Company’s equity incentive plans. A summary of stock option activity under the Equity Plans is as follows: Weighted Average Weighted Aggregate Exercise Price Average Remaining Intrinsic Options Per Share Life in Years Value Outstanding at December 31, 2021 8,525,618 $ 4.48 7.58 $ 7,673 Granted 650,000 $ 1.97 Forfeited (74,111) $ 2.11 Outstanding at March 31, 2022 9,101,507 $ 4.32 7.45 $ 697 Options exercisable at March 31, 2022 5,983,001 $ 5.48 6.73 $ 514 Options vested and expected to vest at March 31, 2022 9,101,507 $ 4.32 7.45 $ 697 The grant date fair value of the options granted during the three months ended March 31, 2022 and 2021 was estimated at the date of grant using the Black-Scholes option valuation model. The expected life was estimated using the “simplified” method as defined by the SEC’s Staff Accounting Bulletin 107, Share-Based Payment. The expected volatility was based on the historical volatility of comparable public companies from a representative peer group selected based on industry and market capitalization data. The risk-free interest rate was based on the continuous rates provided by the U.S. Treasury with a term approximating the expected life of the option. The expected dividend yield was 0% because the Company does not expect to pay any dividends for the foreseeable future. The Company elected the straight-line attribution method in recognizing the grant date fair value of options issued over the requisite service periods of the awards, which are generally the vesting periods. The weighted average grant date fair value for the stock options granted during the three months ended March 31, 2022 and 2021 was $1.39 and $1.57 per share, respectively. The assumptions that the Company used to determine the grant-date fair value of stock options granted to employees and directors during the three months ended March 31, 2022 and 2021 were as follows, presented on a weighted average basis: Three Months Three Months Ended March 31, Ended March 31, 2022 2021 Expected volatility 82.70 % 66.94 % Weighted average risk-free interest rate 1.67 % 0.66 % Expected dividend yield 0.00 % 0.00 % Expected term (in years) 6.01 6.86 Stock options generally vest over a three Restricted Stock Units During the three months ended March 31, 2022 and 2021, the Company granted 2,575,000 and 275,000, respectively, RSUs to employees that will cliff vest and will be settled after three years of continuous service, or upon a change of control of the Company, whichever is earlier, pursuant to the 2016 Plan. The following table presents RSU activity under the 2016 Plan during the three months ended March 31, 2022: Weighted Average Grant Number of Shares Date Fair Value Outstanding at December 31, 2020 753,106 $ 1.52 Awarded 275,000 $ 2.57 Settled in cash (92,500) $ 1.97 Outstanding at December 31, 2021 935,606 $ 1.76 Awarded 2,575,000 $ 1.94 Outstanding at March 31, 2022 3,510,606 $ 1.89 As of March 31, 2022, there were 3,510,606 shares outstanding covered by RSUs that are expected to vest with a weighted average grant date fair value of $1.89 per share and an aggregate grant date fair value of approximately $6,640. As of March 31, 2022, there was approximately $5,452 of unrecognized compensation costs related to RSUs granted to employees, which are expected to be recognized as expense over a remaining weighted average period of 2.66 years. The Company recognized stock-based compensation expense related to the issuance of stock option awards and RSUs to employees and non-employees in the condensed consolidated statements of operations during the three months ending March 31, 2022 and 2021 as follows: Stock Based Compensation Expense Three Months Ended March 31, 2022 2021 Research and development $ 554 $ 345 General and administrative 650 488 Total $ 1,204 $ 833 |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2022 | |
Net Loss Per Share | |
Net Loss Per Share | 9. Net Loss Per Share Basic and diluted net loss per share for the three months ended March 31, 2022 and 2021 was calculated as follows (in thousands except share and per share amounts). Three Months Ended March 31, 2022 2021 Numerator: Net loss $ (10,376) $ (9,134) Net loss attributable to common stockholders for basic and diluted loss per share $ (10,376) $ (9,134) Denominator: Weighted average number of common shares outstanding – basic and diluted 113,248,937 76,378,569 Net loss per share attributable to common stockholders – basic and diluted $ (0.09) $ (0.12) Included within weighted average common shares outstanding for the three months ended March 31, 2022 and 2021 are 24,930,483 and 16,718,418, respectively, common shares issuable upon the exercise of the pre-funded warrants and penny warrants, as the warrants are exercisable at any time for nominal consideration, and as such, the shares are considered outstanding for the purpose of calculating basic and diluted net loss per share attributable to common stockholders. The Company’s potentially dilutive securities include RSUs, stock options and warrants. These securities were excluded from the computations of diluted net loss per share for the three months ended March 31, 2022 and 2021, as the effect would be to reduce the net loss per share. The following table includes the potential shares of common stock, presented based on amounts outstanding at each period end, that were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect: Three Months Ended March 31, 2022 2021 Restricted stock units to purchase common stock 3,510,606 935,606 Options to purchase common stock 9,101,507 7,750,307 Warrants to purchase common stock 35,455,674 35,974,337 48,067,787 44,660,250 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies | |
Commitments and Contingencies | 10. Commitments and Contingencies Manufacturing Agreements License and Service Agreement License Agreement Legal Proceedings Indemnification Agreements |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Summary of Significant Accounting Policies | |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions are eliminated upon consolidation. |
Use of Estimates | Use of Estimates The presentation of condensed consolidated financial statements in conformity with 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 condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Research and development incentive income and receivable | Research and development incentive income and receivable The Company recognizes other income from Australian research and development incentives when there is reasonable assurance that the income will be received, the relevant expenditure has been incurred, and the consideration can be reliably measured. The research and development incentive is one of the key elements of the Australian Government’s support for Australia’s innovation system and is supported by legislative law primarily in the form of the Australian Income Tax Assessment Act 1997, as long as eligibility criteria are met. Management has assessed the Company’s research and development activities and expenditures to determine which activities and expenditures are likely to be eligible under the research and development incentive regime described above. At each period end, management estimates the refundable tax offset available to the Company based on available information at the time. Under the program, a percentage of eligible research and development expenses incurred by the Company through its subsidiary in Australia are reimbursed. The percentage was 43.5% for the year ended December 31, 2021 and for the three months ended March 31, 2022. The research and development incentive receivable represents an amount due in connection with the above program. The Company recorded a research and development incentive receivable of $1,271 and $1,189 as of March 31, 2022 and December 31, 2021, respectively, in the condensed consolidated balance sheets and other income from Australian research and development incentives of $37 and $71, respectively, for the three months ended March 31, 2022 and 2021. The following table shows the change in the research and development incentive receivable from January 1, 2021 to March 31, 2022 (in thousands): Balance at January 1, 2021 73 Australian research and development incentive income, net 1,226 Cash received for 2020 eligible expenses (111) Foreign currency translation 1 Balance at December 31, 2021 $ 1,189 Australian research and development incentive income, net 37 Foreign currency translation 45 Balance at March 31, 2022 $ 1,271 |
Foreign Currency Translation | Foreign Currency Translation The financial statements of the Company’s Australian subsidiary are measured using the local currency as the functional currency. Assets and liabilities of this subsidiary are translated into U.S. dollars at an exchange rate as of the consolidated balance sheet date. Equity is translated at historical exchange rates. Revenues and expenses are translated into U.S. dollars at average rates of exchange in effect during the period. The resulting cumulative translation adjustments have been recorded as a separate component of stockholders’ equity. Realized and unrealized foreign currency transaction gains and losses are included in the results of operations. |
Deposits | Deposits As of March 31, 2022 and December 31, 2021, there were $293 of deposits made by the Company with certain service providers that are to be applied to future payments due under the service agreements or returned to the Company if not utilized which were recorded in the condensed consolidated balance sheets. |
Warrants | Warrants The Company will recognize on a prospective basis the value of the effect of the down round feature in the warrants to purchase shares of common stock that were issued in a private placement in November 2017 (the “2017 Warrants”) when it is triggered (i.e., when the exercise price is adjusted downward). This value is measured as the difference between (1) the financial instrument’s fair value (without the down round feature) using the pre-trigger exercise price and (2) the financial instrument’s fair value (with the down round feature) using the reduced exercise price. The value of the effect of the down round feature will be treated as a dividend and a reduction to income available to common stockholders in the basic EPS calculation. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Certain assets and liabilities are carried at fair value under GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: ● Level 1—Quoted prices in active markets for identical assets or liabilities. ● Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data. ● Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. During the periods presented, the Company did not change the manner in which it values assets and liabilities that are measured at fair value using Level 3 inputs. There were no transfers within the hierarchy during the three months ended March 31, 2022 or the year ended December 31, 2021. A summary of the assets and liabilities carried at fair value in accordance with the hierarchy defined above is as follows (in thousands): Total Level 1 Level 2 Level 3 March 31, 2022 Assets: Cash equivalents $ 101,004 $ 101,004 $ — $ — Total assets $ 101,004 $ 101,004 $ — $ — December 31, 2021 Assets: Cash equivalents $ 112,726 $ 112,726 $ — $ — Total assets $ 112,726 $ 112,726 $ — $ — Cash equivalents of $101,004 and $112,726 as of March 31, 2022 and December 31, 2021, respectively, consisted of overnight investments and money market funds and are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices in active markets. The carrying values of the research and development incentive receivable, accounts payable and accrued liabilities approximate their fair value due to the short-term nature of these assets and liabilities. |
Leases | Leases The Company accounts for leases in accordance with Accounting Standards Codification, or ASC, Topic 842, Leases At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present. Most leases with a term greater than one year are recognized on the balance sheet as right-of-use assets, lease liabilities and, if applicable, long-term lease liabilities. The Company has elected not to recognize on the balance sheet leases with terms of one year or less. Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over the expected remaining lease term. The Company has determined that the rate implicit in the lease is not determinable and the Company does not have borrowings with similar terms and collateral. Therefore, the Company considered a variety of factors, including observable debt yields from comparable companies and the volatility in the debt market for securities with similar terms, in determining that 8% was reasonable to use as the incremental borrowing rate for purposes of the calculation of lease liabilities. In accordance with the guidance in Topic 842, components of a lease should be split into three categories: lease components (e.g. land, building, etc.), non-lease components (e.g. common area maintenance, maintenance, consumables, etc.), and non-components (e.g. property taxes, insurance, etc.). Then the fixed and in-substance fixed contract consideration (including any related to non-components) must be allocated based on fair values to the lease components and non-lease components. Although separation of lease and non-lease components is required, certain practical expedients are available. Entities may elect the practical expedient to not separate lease and non-lease components. Rather, they would account for each lease component and the related non-lease component together as a single component. The Company has elected to account for the lease and non-lease components of each of its operating leases as a single lease component and allocate all of the contract consideration to the lease component only. The lease component results in an operating right-of-use asset being recorded on the consolidated balance sheets and amortized such that lease expense is recorded on a straight line basis over the term of the lease. |
Revenue Recognition | Revenue Recognition The Company records revenue in accordance with ASC Topic 606, Revenue From Contracts with Customers. |
License revenue | License revenue. |
Research and Development Services | Research and Development Services. |
Customer Options | Customer Options. |
Milestone Payments | Milestone Payments. |
Royalties | Royalties |
Collaborative Arrangements | Collaborative Arrangements The Company analyzes its collaboration arrangements to assess whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards dependent on the commercial success of such activities and therefore within the scope of ASC Topic 808, Collaborative Arrangements (ASC 808). This assessment is performed throughout the life of the arrangement based on changes in the responsibilities of all parties in the arrangement. For collaboration arrangements within the scope of ASC 808 that contain multiple elements, the Company first determines which elements of the collaboration are deemed to be within the scope of ASC 808 and which elements of the collaboration are more reflective of a vendor-customer relationship and therefore within the scope of ASC 606. For elements of collaboration arrangements that are accounted for pursuant to ASC 808, an appropriate recognition method is determined and applied consistently, generally by analogy to ASC 606. Amounts that are owed to collaboration partners are recognized as an offset to collaboration revenues as such amounts are incurred by the collaboration partner. Where amounts owed to a collaboration partner exceed the Company’s collaboration revenues in each quarterly period, such amounts are classified as research and development expense. Reimbursements from and payments to the customer that are the result of a collaborative relationship with a partner, instead of a customer relationship, such as co-development activities, are recorded as a reduction to research and development expense. For those elements of the arrangement that are accounted for pursuant to ASC 606, the Company applies the five-step model described above under ASC 606. See Note 3 for a complete discussion of the revenue recognition for the Company’s license agreement. |
Net Loss per Share | Net Loss per Share Basic net loss per share is computed using the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed using the weighted average number of common shares outstanding during the period and, if dilutive, the weighted average number of potential shares of common stock, including the assumed exercise of stock options and warrants. |
Subsequent Events | Subsequent Events The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements For a discussion of recent accounting pronouncements please refer to Note 2, “Summary of Significant Accounting Policies”, in the Company’s previously filed Annual Report on Form 10-K for the year ended December 31, 2021. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Summary of Significant Accounting Policies | |
Schedule of change in the research and development incentive receivable | The following table shows the change in the research and development incentive receivable from January 1, 2021 to March 31, 2022 (in thousands): Balance at January 1, 2021 73 Australian research and development incentive income, net 1,226 Cash received for 2020 eligible expenses (111) Foreign currency translation 1 Balance at December 31, 2021 $ 1,189 Australian research and development incentive income, net 37 Foreign currency translation 45 Balance at March 31, 2022 $ 1,271 |
Summary of assets and liabilities carried at fair value in accordance with the hierarchy | During the periods presented, the Company did not change the manner in which it values assets and liabilities that are measured at fair value using Level 3 inputs. There were no transfers within the hierarchy during the three months ended March 31, 2022 or the year ended December 31, 2021. A summary of the assets and liabilities carried at fair value in accordance with the hierarchy defined above is as follows (in thousands): Total Level 1 Level 2 Level 3 March 31, 2022 Assets: Cash equivalents $ 101,004 $ 101,004 $ — $ — Total assets $ 101,004 $ 101,004 $ — $ — December 31, 2021 Assets: Cash equivalents $ 112,726 $ 112,726 $ — $ — Total assets $ 112,726 $ 112,726 $ — $ — |
BeiGene Exclusive Option and _2
BeiGene Exclusive Option and License Agreement (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
BeiGene Exclusive Option and License Agreement | |
Summary of activity in Company's contract liabilities | The following table presents a summary of the activity in the Company’s contract liabilities, related to the upfront cash payment received of $3,000 , from January 1, 2021 through March 31, 2022 (in thousands): Balance at January 1, 2021 $ 1,500 Deductions (1,500) Balance at December 31, 2021 $ — |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accrued Expenses | |
Schedule of accrued expenses | March 31, December 31, 2022 2021 Clinical trials $ 1,915 $ 2,499 Professional fees 110 181 Payroll and related expenses 669 2,686 Accrued expenses $ 2,694 $ 5,366 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Leases | |
Schedule of future lease payments | Future Operating Lease Payments 2022 $ 333 2023 37 Total Lease Payments 370 Less: imputed interest (7) Total operating lease liabilities $ 363 |
Warrants (Tables)
Warrants (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Warrants | |
Schedule of warrants | March 31, 2022 Number of Shares Description Issuable Exercise Price Expiration Date January 23 2017 Warrants 54,516 $ 0.01 Upon M&A Event 2017 Warrants 2,502,382 $ 1.055 November 2024 2019 Warrants 7,008,257 $ 1.95 February 2026 March 2020 14,413,902 $ 0.001 No Expiry March 2020 25,945,035 $ 2.11 Jan - March 2027 June 2020 1,690,137 $ 0.001 No Expiry September 2021 8,771,928 $ 0.001 No Expiry 60,386,157 |
Equity Incentive Plans (Tables)
Equity Incentive Plans (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Equity Incentive Plans | |
Summary of stock option activity under the Equity Plans | Weighted Average Weighted Aggregate Exercise Price Average Remaining Intrinsic Options Per Share Life in Years Value Outstanding at December 31, 2021 8,525,618 $ 4.48 7.58 $ 7,673 Granted 650,000 $ 1.97 Forfeited (74,111) $ 2.11 Outstanding at March 31, 2022 9,101,507 $ 4.32 7.45 $ 697 Options exercisable at March 31, 2022 5,983,001 $ 5.48 6.73 $ 514 Options vested and expected to vest at March 31, 2022 9,101,507 $ 4.32 7.45 $ 697 |
Schedule of assumptions used to determine grant-date fair value of stock options | Three Months Three Months Ended March 31, Ended March 31, 2022 2021 Expected volatility 82.70 % 66.94 % Weighted average risk-free interest rate 1.67 % 0.66 % Expected dividend yield 0.00 % 0.00 % Expected term (in years) 6.01 6.86 |
Summary of RSU activity under the 2016 Plan | Weighted Average Grant Number of Shares Date Fair Value Outstanding at December 31, 2020 753,106 $ 1.52 Awarded 275,000 $ 2.57 Settled in cash (92,500) $ 1.97 Outstanding at December 31, 2021 935,606 $ 1.76 Awarded 2,575,000 $ 1.94 Outstanding at March 31, 2022 3,510,606 $ 1.89 |
Schedule of recognized stock-based compensation expense related to the issuance of stock option awards and RSUs to employees and non-employees in the condensed consolidated statements of operations | Three Months Ended March 31, 2022 2021 Research and development $ 554 $ 345 General and administrative 650 488 Total $ 1,204 $ 833 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Net Loss Per Share | |
Schedule of basic and diluted net loss per share | Basic and diluted net loss per share for the three months ended March 31, 2022 and 2021 was calculated as follows (in thousands except share and per share amounts). Three Months Ended March 31, 2022 2021 Numerator: Net loss $ (10,376) $ (9,134) Net loss attributable to common stockholders for basic and diluted loss per share $ (10,376) $ (9,134) Denominator: Weighted average number of common shares outstanding – basic and diluted 113,248,937 76,378,569 Net loss per share attributable to common stockholders – basic and diluted $ (0.09) $ (0.12) |
Schedule of potentially anti-dilutive securities excluded from calculation of diluted net loss per share | Three Months Ended March 31, 2022 2021 Restricted stock units to purchase common stock 3,510,606 935,606 Options to purchase common stock 9,101,507 7,750,307 Warrants to purchase common stock 35,455,674 35,974,337 48,067,787 44,660,250 |
Nature of Business, Basis of _2
Nature of Business, Basis of Presentation and Liquidity - Liquidity (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Liquidity | |||
Cash and cash equivalents | $ 103,220 | $ 114,916 | |
Accumulated deficit | 273,948 | $ 263,572 | |
Net loss | $ 10,376 | $ 9,134 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Research and development incentive income and receivable | |||
Research and development expenses reimbursed (as a percent) | 43.50% | 43.50% | |
Research and development incentive income and receivable | |||
Balance at the beginning of the period | $ 1,189 | $ 73 | $ 73 |
Australian research and development incentive income, net | 37 | $ 71 | (1,226) |
Cash received for eligible expenses | (111) | ||
Foreign currency translation | 45 | 1 | |
Balance at the end of the period | 1,271 | 1,189 | |
Other Assets | |||
Deposits with service providers that are to be applied to future payments | $ 293 | $ 293 | |
Incremental borrowing rate | 8.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Assets: | ||
Cash equivalents | $ 101,004 | $ 112,726 |
Total assets | 101,004 | 112,726 |
Level 1 | ||
Assets: | ||
Cash equivalents | 101,004 | 112,726 |
Total assets | $ 101,004 | $ 112,726 |
BeiGene Exclusive Option and _3
BeiGene Exclusive Option and License Agreement - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Jan. 03, 2020 | |
BeiGene Exclusive Option and License Agreement | |||
Up-front fee | $ 3,000 | ||
Contract acquisition costs | 270 | ||
Amortization expense | $ 34 | ||
Exclusive Option and License Agreement | |||
BeiGene Exclusive Option and License Agreement | |||
Future option exercise and milestone payments, maximum | $ 132,000 | ||
License | |||
BeiGene Exclusive Option and License Agreement | |||
Revenue recognized | 0 | 375 | |
Royalty | |||
BeiGene Exclusive Option and License Agreement | |||
Revenue recognized | 0 | $ 0 | |
Exclusive Option and License Agreement | |||
BeiGene Exclusive Option and License Agreement | |||
Upfront cash payment | $ 3,000 | $ 3,000 |
BeiGene Exclusive Option and _4
BeiGene Exclusive Option and License Agreement - Contract Liabilities (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Contract liabilities | |
Balance | $ 1,500 |
Deductions | $ (1,500) |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Accrued Expenses | ||
Clinical trials | $ 1,915 | $ 2,499 |
Professional fees | 110 | 181 |
Payroll and related expenses | 669 | 2,686 |
Accrued expenses | $ 2,694 | $ 5,366 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Right of use assets, net | $ 355 | $ 459 | |
Lease liability | 363 | ||
Rent expense | 108 | $ 105 | |
Restatement Adjustment | Accounting Standards Update 2016-02 [Member] | |||
Lease liability | $ 363 |
Leases - Future minimum lease p
Leases - Future minimum lease payments (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Leases | |
2022 | $ 333 |
2023 | 37 |
Total Lease Payments | 370 |
Less: imputed interest | (7) |
Total operating lease liabilities | $ 363 |
Warrants (Details)
Warrants (Details) - $ / shares | Sep. 24, 2021 | Jun. 22, 2020 | Mar. 05, 2020 | Jan. 03, 2020 | Mar. 31, 2022 | Feb. 05, 2019 |
Warrants | ||||||
Number of Shares Issuable | 60,386,157 | |||||
January 23 2017 Warrants | ||||||
Warrants | ||||||
Number of Shares Issuable | 54,516 | |||||
Exercise price of warrant | $ 0.01 | |||||
2017 Warrants | ||||||
Warrants | ||||||
Number of Shares Issuable | 2,502,382 | |||||
Exercise price of warrant | $ 1.055 | |||||
March 2020 | ||||||
Warrants | ||||||
Number of Shares Issuable | 14,413,902 | |||||
Exercise price of warrant | $ 0.001 | |||||
March 2020. | ||||||
Warrants | ||||||
Number of Shares Issuable | 25,945,035 | |||||
Exercise price of warrant | $ 2.11 | |||||
June 2020 | ||||||
Warrants | ||||||
Number of Shares Issuable | 1,690,137 | |||||
Exercise price of warrant | $ 0.001 | $ 0.001 | ||||
Warrant to purchase shares of common stock | 2,250,000 | |||||
June 2020 | Common Stock. | ||||||
Warrants | ||||||
Common stock issued | 20,250,000 | |||||
Purchase price | $ 2 | |||||
September 2021 | ||||||
Warrants | ||||||
Number of Shares Issuable | 8,771,928 | |||||
Exercise price of warrant | $ 0.001 | $ 0.001 | ||||
Warrant to purchase shares of common stock | 8,771,928 | |||||
September 2021 | Common Stock. | ||||||
Warrants | ||||||
Common stock issued | 22,828,072 | |||||
Common stock issued | 27,568,072 | |||||
Purchase price | $ 2.85 | |||||
2019 Warrants | ||||||
Warrants | ||||||
Number of Shares Issuable | 7,008,257 | 7,557,142 | ||||
Exercise price of warrant | $ 1.95 | $ 1.95 | ||||
March 2020 Warrants | Series A Convertible Preferred Stock | ||||||
Warrants | ||||||
Exercise price of warrant | $ 0.001 | |||||
Common stock issued | 1,421,801 | |||||
Purchase price | $ 10.54 | |||||
Warrant to purchase shares of common stock | 14,413,902 | |||||
March 2020 Warrants | Series B Convertible Preferred Stock | ||||||
Warrants | ||||||
Exercise price of warrant | $ 2.11 | |||||
Common stock issued | 1,137,442 | |||||
Purchase price | $ 10.55 | |||||
Conversion of Stock, Shares Issued | 11,531,133 |
Common Stock - Private Placemen
Common Stock - Private Placement of Common Stock (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($)item | |
Common Stock | |
Number of Vote on Common Shares | item | 1 |
Dividends, Common Stock | $ | $ 0 |
Common stock - Public Offering
Common stock - Public Offering of Common Stock (Details) - September 2021 - USD ($) | Sep. 24, 2021 | Mar. 31, 2022 |
Warrant to purchase shares of common stock | 8,771,928 | |
Exercise price of warrant | $ 0.001 | $ 0.001 |
Common Stock. | ||
Common stock issued | 22,828,072 | |
Issue price | $ 2.85 | |
Net proceeds from issuance of common stock | $ 96,828 | |
Underwriters' exercise | Common Stock. | ||
Common stock issued | 4,740,000 |
Equity Incentive Plans (Details
Equity Incentive Plans (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 20, 2017 | Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 |
Options | ||||
Outstanding balance at the beginning of the period (in shares) | 8,525,618 | |||
Granted (in shares) | 650,000 | |||
Forfeited (in shares) | (74,111) | |||
Outstanding balance at the end of the period (in shares) | 9,101,507 | 8,525,618 | ||
Options exercisable at the end of the period (in shares) | 5,983,001 | |||
Options vested and expected to vest at end of period (in shares) | 9,101,507 | |||
Weighted Average Exercise Price Per Share | ||||
Outstanding balance at the beginning of the period (in dollars per share) | $ 4.48 | |||
Granted (in dollars per share) | 1.97 | |||
Forfeited (in dollars per share) | 2.11 | |||
Outstanding balance at the end of the period (in dollars per share) | 4.32 | $ 4.48 | ||
Exercisable at the end of the period (in dollars per share) | 5.48 | |||
Options vested and expected to vest at end of the period (in dollars per share) | $ 4.32 | |||
Weighted Average Remaining Life in Years | ||||
Outstanding balance | 7 years 5 months 12 days | 7 years 6 months 29 days | ||
Options exercisable at end of period | 6 years 8 months 23 days | |||
Options vested and expected to vest at end of the period | 7 years 5 months 12 days | |||
Aggregate Intrinsic Value | ||||
Outstanding balance | $ 697 | $ 7,673 | ||
Options exercisable at the end of the period | 514 | |||
Options vested and expected to vest at end of the period | $ 697 | |||
Assumptions used to determine grant-date fair value | ||||
Expected Volatility | 82.70% | 66.94% | ||
Weighted average risk-free interest rate | 1.67% | 0.66% | ||
Expected dividend yield | 0.00% | 0.00% | ||
Expected term (in years) | 6 years 3 days | 6 years 10 months 9 days | ||
Expiration period | 10 years | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 1.39 | $ 1.57 | ||
Compensation cost related to the non-vested awards not yet recognized | $ 3,901 | |||
Weighted average period for recognition of compensation cost | 1 year 9 months 25 days | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||
Outstanding at end(in dollars per share) | $ 1.39 | $ 1.57 | ||
Minimum | ||||
Assumptions used to determine grant-date fair value | ||||
Vesting period | 3 years | |||
Maximum | ||||
Assumptions used to determine grant-date fair value | ||||
Vesting period | 4 years | |||
2016 Plan | ||||
Assumptions used to determine grant-date fair value | ||||
Annual increase in authorized shares (as a percent) | 4.00% | |||
Number of options or stock awards available for grant under the Plan | 791,745 | |||
Options to purchase common stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||
Stock-based compensation expense | $ 1,204 | $ 833 | ||
Options to purchase common stock | Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||
Stock-based compensation expense | 554 | 345 | ||
Options to purchase common stock | General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||
Stock-based compensation expense | 650 | $ 488 | ||
Restricted stock units to purchase common stock | ||||
Assumptions used to determine grant-date fair value | ||||
Aggregate grant fair value | 6,640 | |||
Share-based Payment Arrangement, Nonvested Award, Excluding Option, Cost Not yet Recognized, Amount | $ 5,452 | |||
Weighted average period for recognition of compensation cost | 2 years 7 months 28 days | |||
Restricted stock units to purchase common stock | Executive Officer [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Awarded | 2,575,000 | 275,000 | ||
Restricted stock units to purchase common stock | 2016 Plan | ||||
Assumptions used to determine grant-date fair value | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 1.89 | $ 1.76 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Outstanding at the beginning | 935,606 | 753,106 | 753,106 | |
Awarded | 2,575,000 | 275,000 | ||
Settled in cash | (92,500) | |||
Outstanding at the end | 3,510,606 | 935,606 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||
Outstanding at beginning( in dollars per share) | $ 1.76 | $ 1.52 | $ 1.52 | |
Awarded (in dollars per share) | 1.94 | 2.57 | ||
Settled in cash(in dollars per share) | 1.97 | |||
Outstanding at end(in dollars per share) | $ 1.89 | $ 1.76 |
Net Loss Per Share - Basic and
Net Loss Per Share - Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Numerator: | ||
Net loss | $ (10,376) | $ (9,134) |
Net loss attributable to common stockholders for basic and diluted loss per share | $ (10,376) | $ (9,134) |
Denominator: | ||
Net loss per share attributable to common stockholders - basic | $ (0.09) | $ (0.12) |
Net loss per share attributable to common stockholders - Diluted | $ (0.09) | $ (0.12) |
Weighted average number of common shares outstanding - basic | 113,248,937 | 76,378,569 |
Weighted average number of common shares outstanding - Diluted | 113,248,937 | 76,378,569 |
Exercise of the pre-funded warrants | 24,930,483 | 16,718,418 |
Net Loss Per Share - Antidiluti
Net Loss Per Share - Antidilutive (Details) - shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Securities excluded from computation of diluted net loss per share | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 48,067,787 | 44,660,250 |
Restricted stock units to purchase common stock | ||
Securities excluded from computation of diluted net loss per share | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 3,510,606 | 935,606 |
Options to purchase common stock | ||
Securities excluded from computation of diluted net loss per share | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 9,101,507 | 7,750,307 |
Warrants to purchase common stock | ||
Securities excluded from computation of diluted net loss per share | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 35,455,674 | 35,974,337 |
Commitments and Contingencies -
Commitments and Contingencies - Manufacturing, License and Other Agreements (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Commitments and Contingencies | |
Manufacturing commitments | $ 6,982 |
License and service agreements | |
Commitments and Contingencies | |
Royalties paid or accrued | 0 |
Licensing agreements | |
Commitments and Contingencies | |
Royalties paid or accrued | $ 0 |