Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 02, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ALEC | |
Entity File Number | 001-38792 | |
Entity Tax Identification Number | 82-2933343 | |
Entity Address, Address Line One | 131 Oyster Point Blvd | |
Entity Address, Address Line Two | Suite 600 | |
Entity Address, City or Town | South San Francisco | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94080 | |
City Area Code | 415 | |
Local Phone Number | 231-5660 | |
Document Transition Report | false | |
Document Quarterly Report | true | |
Entity Registrant Name | Alector, Inc. | |
Entity Central Index Key | 0001653087 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Current Reporting Status | Yes | |
Entity Common Stock, Shares Outstanding | 84,136,381 | |
Security Exchange Name | NASDAQ | |
Title of 12(b) Security | Common Stock | |
Entity Interactive Data Current | Yes | |
Entity Incorporation, State or Country Code | DE |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 101,964 | $ 154,323 |
Marketable securities | 486,897 | 558,528 |
Receivable from Collaboration partner | 10,465 | 2,587 |
Prepaid expenses and other current assets | 13,821 | 10,997 |
Total current assets | 613,147 | 726,435 |
Property and equipment, net | 23,115 | 25,521 |
Operating lease right-of-use assets | 26,039 | 27,811 |
Restricted cash | 1,546 | 1,472 |
Other assets | 8,548 | 6,409 |
Total assets | 672,395 | 787,648 |
Current liabilities: | ||
Accounts payable | 4,679 | 4,189 |
Accrued clinical supply costs | 7,430 | 5,559 |
Accrued liabilities | 30,423 | 27,771 |
Deferred revenue, current portion | 80,561 | 48,231 |
Refund liability to collaboration partner, current portion | 23,919 | 0 |
Operating lease liabilities, current portion | 8,390 | 8,059 |
Total current liabilities | 155,402 | 93,809 |
Deferred revenue, long-term portion | 229,848 | 443,370 |
Refund liability to collaboration partner, long-term portion | 91,849 | 0 |
Operating lease liabilities, long-term portion | 31,843 | 35,268 |
Other long-term liabilities | 898 | 759 |
Total liabilities | 509,840 | 573,206 |
Commitments and contingencies (Note 4) | ||
Stockholders' equity: | ||
Common stock, $0.0001 par value; 200,000,000 shares authorized; 84,136,381 and 82,895,718 shares issued and outstanding as of September 30, 2023 and December 31, 2022 | 8 | 8 |
Additional paid-in capital | 831,912 | 798,696 |
Accumulated other comprehensive loss | (721) | (4,575) |
Accumulated deficit | (668,644) | (579,687) |
Total stockholders' equity | 162,555 | 214,442 |
Total liabilities and stockholders’ equity | $ 672,395 | $ 787,648 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) (Unaudited) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 84,136,381 | 82,895,718 |
Common stock, shares outstanding | 84,136,381 | 82,895,718 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Total revenue | $ 9,109 | $ 14,852 | $ 81,872 | $ 119,177 |
Operating expenses: | ||||
Research and development | 46,328 | 48,348 | 144,392 | 155,925 |
General and administrative | 13,364 | 14,252 | 41,767 | 45,648 |
Total operating expenses | 59,692 | 62,600 | 186,159 | 201,573 |
Loss from operations | (50,583) | (47,748) | (104,287) | (82,396) |
Other income, net | 7,360 | 2,333 | 18,876 | 4,047 |
Loss before income taxes | (43,223) | (45,415) | (85,411) | (78,349) |
Income tax expense | 1,252 | 733 | 3,546 | 2,533 |
Net loss | (44,475) | (46,148) | (88,957) | (80,882) |
Unrealized gain (loss) on marketable securities | 665 | (518) | 3,854 | (5,799) |
Comprehensive loss | $ (43,810) | $ (46,666) | $ (85,103) | $ (86,681) |
Net loss per share, basic | $ (0.53) | $ (0.56) | $ (1.07) | $ (0.98) |
Net loss per share, diluted | $ (0.53) | $ (0.56) | $ (1.07) | $ (0.98) |
Shares used in computing net loss per share, basic | 83,927,961 | 82,602,842 | 83,513,954 | 82,367,936 |
Shares used in computing net loss per share, diluted | 83,927,961 | 82,602,842 | 83,513,954 | 82,367,936 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Beginning balance at Dec. 31, 2021 | $ 300,724 | $ 8 | $ 748,036 | $ (943) | $ (446,377) |
Beginning balance (in shares) at Dec. 31, 2021 | 81,986,192 | ||||
Exercise of stock options | 2,483 | 2,483 | |||
Exercise of stock options (in shares) | 234,117 | ||||
Vesting of restricted stock units | 104,368 | ||||
Stock-based compensation | 11,939 | 11,939 | |||
Unrealized gain (loss) on marketable securities | (2,992) | (2,992) | |||
Net Income (Loss) | (44,617) | (44,617) | |||
Ending balance at Mar. 31, 2022 | 267,537 | $ 8 | 762,458 | (3,935) | (490,994) |
Ending balance (in shares) at Mar. 31, 2022 | 82,324,677 | ||||
Beginning balance at Dec. 31, 2021 | 300,724 | $ 8 | 748,036 | (943) | (446,377) |
Beginning balance (in shares) at Dec. 31, 2021 | 81,986,192 | ||||
Net Income (Loss) | (80,882) | ||||
Ending balance at Sep. 30, 2022 | 253,104 | $ 8 | 787,097 | (6,742) | (527,259) |
Ending balance (in shares) at Sep. 30, 2022 | 82,700,939 | ||||
Beginning balance at Mar. 31, 2022 | 267,537 | $ 8 | 762,458 | (3,935) | (490,994) |
Beginning balance (in shares) at Mar. 31, 2022 | 82,324,677 | ||||
Exercise of stock options | 41 | 41 | |||
Exercise of stock options (in shares) | 4,244 | ||||
Purchase of common stock under employee stock purchase plan (in shares) | 114,904 | ||||
Purchase of common stock under employee stock purchase plan | 866 | 866 | |||
Vesting of restricted stock units | 101,076 | ||||
Stock-based compensation | 12,478 | 12,478 | |||
Unrealized gain (loss) on marketable securities | (2,289) | (2,289) | |||
Net Income (Loss) | 9,883 | 9,883 | |||
Ending balance at Jun. 30, 2022 | 288,516 | $ 8 | 775,843 | (6,224) | (481,111) |
Ending balance (in shares) at Jun. 30, 2022 | 82,544,901 | ||||
Exercise of stock options | 489 | 489 | |||
Exercise of stock options (in shares) | 54,278 | ||||
Vesting of restricted stock units | 101,760 | ||||
Stock-based compensation | 10,765 | 10,765 | |||
Unrealized gain (loss) on marketable securities | (518) | (518) | |||
Net Income (Loss) | (46,148) | (46,148) | |||
Ending balance at Sep. 30, 2022 | 253,104 | $ 8 | 787,097 | (6,742) | (527,259) |
Ending balance (in shares) at Sep. 30, 2022 | 82,700,939 | ||||
Beginning balance at Dec. 31, 2022 | $ 214,442 | $ 8 | 798,696 | (4,575) | (579,687) |
Beginning balance (in shares) at Dec. 31, 2022 | 82,895,718 | 82,895,718 | |||
Exercise of stock options | $ 1,079 | 1,079 | |||
Exercise of stock options (in shares) | 132,191 | ||||
Vesting of restricted stock units | 323,869 | ||||
Stock-based compensation | 10,975 | 10,975 | |||
Unrealized gain (loss) on marketable securities | 2,376 | 2,376 | |||
Net Income (Loss) | (45,857) | (45,857) | |||
Ending balance at Mar. 31, 2023 | 183,015 | $ 8 | 810,750 | (2,199) | (625,544) |
Ending balance (in shares) at Mar. 31, 2023 | 83,351,778 | ||||
Beginning balance at Dec. 31, 2022 | $ 214,442 | $ 8 | 798,696 | (4,575) | (579,687) |
Beginning balance (in shares) at Dec. 31, 2022 | 82,895,718 | 82,895,718 | |||
Net Income (Loss) | $ (88,957) | ||||
Ending balance at Sep. 30, 2023 | $ 162,555 | $ 8 | 831,912 | (721) | (668,644) |
Ending balance (in shares) at Sep. 30, 2023 | 84,136,381 | 84,136,381 | |||
Beginning balance at Mar. 31, 2023 | $ 183,015 | $ 8 | 810,750 | (2,199) | (625,544) |
Beginning balance (in shares) at Mar. 31, 2023 | 83,351,778 | ||||
Purchase of common stock under employee stock purchase plan (in shares) | 139,267 | ||||
Purchase of common stock under employee stock purchase plan | 881 | 881 | |||
Vesting of restricted stock units | 339,255 | ||||
Stock-based compensation | 10,222 | 10,222 | |||
Unrealized gain (loss) on marketable securities | 813 | 813 | |||
Net Income (Loss) | 1,375 | 1,375 | |||
Ending balance at Jun. 30, 2023 | 196,306 | $ 8 | 821,853 | (1,386) | (624,169) |
Ending balance (in shares) at Jun. 30, 2023 | 83,830,300 | ||||
Vesting of restricted stock units | 306,081 | ||||
Stock-based compensation | 10,059 | 10,059 | |||
Unrealized gain (loss) on marketable securities | 665 | 665 | |||
Net Income (Loss) | (44,475) | (44,475) | |||
Ending balance at Sep. 30, 2023 | $ 162,555 | $ 8 | $ 831,912 | $ (721) | $ (668,644) |
Ending balance (in shares) at Sep. 30, 2023 | 84,136,381 | 84,136,381 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities: | ||
Net loss | $ (88,957) | $ (80,882) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 4,288 | 4,320 |
Stock-based compensation | 31,256 | 35,183 |
Amortization of premiums and accretion of discounts on marketable securities | (10,510) | 269 |
Amortization of right-of-use assets | 2,302 | 2,039 |
Changes in operating assets and liabilities: | ||
Receivable from collaboration partner | (7,878) | 900 |
Prepaid expenses and other current assets | (2,824) | (3,095) |
Other assets | (2,139) | (210) |
Accounts payable | 638 | (383) |
Accrued liabilities and accrued clinical supply costs | 4,667 | (7,287) |
Deferred revenue | (51,592) | 80,823 |
Refund liability to collaboration partner | (13,832) | 0 |
Lease liabilities | (3,650) | (3,156) |
Other long-term liabilities | 139 | 75 |
Net cash provided by (used in) operating activities | (138,092) | 28,596 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (2,148) | (3,351) |
Purchase of marketable securities | (414,478) | (394,345) |
Maturities of marketable securities | 500,473 | 220,301 |
Net cash provided by (used in) investing activities | 83,847 | (177,395) |
Cash flows from financing activities: | ||
Proceeds from the exercise of options to purchase common stock | 1,079 | 3,013 |
Purchase of common stock under employee stock purchase plan | 881 | 865 |
Net cash provided by financing activities | 1,960 | 3,878 |
Net increase in cash, cash equivalents, and restricted cash | (52,285) | (144,921) |
Cash, cash equivalents, and restricted cash at beginning of period | 155,795 | 330,624 |
Cash, cash equivalents, and restricted cash at end of period | 103,510 | 185,703 |
Non-cash investing and financing activities: | ||
Property and equipment purchases included in accounts payable and accrued liabilities | $ 201 | $ 633 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||||||
Net Income (Loss) | $ (44,475) | $ 1,375 | $ (45,857) | $ (46,148) | $ 9,883 | $ (44,617) | $ (88,957) | $ (80,882) |
Insider Trading Arrangements
Insider Trading Arrangements | 9 Months Ended |
Sep. 30, 2023 shares | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | (c) During our last fiscal quarter, the following officers and directors adopted a “Rule 10b5-1 trading arrangement” as defined in Regulation S-K Item 408, as follows: On August 30, 2023 , Arnon Rosenthal , the Company’s Chief Executive Officer and member of the Company’s Board of Directors, adopted a Rule 10b5-1 trading plan on behalf of a family trust. This plan provides for the sale from time to time of an aggregate of up to 800,000 shares of the Company’s common stock. Sales of the shares of the Company’s common stock set forth in Dr. Rosenthal's trading plan, if any, will be made at or above specified market prices. The trading plan will expire on December 5, 2024, or earlier if all transactions under the trading plan are completed. Dr. Rosenthal’s trading plan was entered into during an open insider trading window and is intended to satisfy the affirmative defense in Rule 10b5-1(c) under the Exchange Act and the Company’s policies regarding insider transactions. On August 28, 2023 , Marc Grasso , the Company’s Chief Financial Officer , adopted a Rule 10b5-1 trading plan. Dr. Grasso’s plan provides for (i) the exercise of vested stock options to purchase an aggregate of up to 75,501 shares of the Company's common stock, and (ii) the sale from time to time of an aggregate of up to 89,362 shares of the Company’s common stock. Sales of the shares of the Company’s common stock set forth in Dr. Grasso's trading plan, if any, will be made at or above specified market prices. The trading plan will expire on September 30, 2024, or earlier if all transactions under the trading plan are completed. Dr. Grasso’s trading plan was entered into during an open insider trading window and is intended to satisfy the affirmative defense in Rule 10b5-1(c) under the Exchange Act and the Company’s policies regarding insider transactions. Other than as disclosed above, during our last fiscal quarter, no other officer or director (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated a “Rule 10b5-1 trading arrangement” or a "non-Rule 10b5-1 trading arrangement" (each as defined in Item 408 of Regulation S-K). |
Arnon Rosenthal [Member] | |
Trading Arrangements, by Individual | |
Name | Arnon Rosenthal |
Title | Chief Executive Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | August 30, 2023 |
Aggregate Available | 800,000 |
Marc Grasso [Member] | |
Trading Arrangements, by Individual | |
Name | Marc Grasso |
Title | Chief Financial Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | August 28, 2023 |
Other Officer or Director [Member] | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Rule 10B5-1 Trading Plan [Member] | Marc Grasso [Member] | |
Trading Arrangements, by Individual | |
Aggregate Available | 75,501 |
Rule 10B51 Trading Plan One [Member] | Marc Grasso [Member] | |
Trading Arrangements, by Individual | |
Aggregate Available | 89,362 |
The Company and Liquidity
The Company and Liquidity | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
The Company and Liquidity | 1. The Company and Liquidity Alector, Inc. (Alector or the Company) is a Delaware corporation headquartered in South San Francisco, California. Alector is a clinical stage biopharmaceutical company pioneering immuno-neurology, a novel therapeutic approach for the treatment of neurodegeneration. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States (GAAP) as defined by the Financial Accounting Standards Board (FASB). In the opinion of management, these unaudited condensed consolidated financial statements include all normal, recurring adjustments that are necessary to present fairly the results of the interim periods presented. The condensed consolidated financial statements include the accounts of Alector, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year. These interim financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2022, and the notes thereto, which are included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on February 28, 2023. Use of Estimates The preparation 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 revenue and expense during the reporting period. The Company evaluates its estimates, including those related to revenue recognition, manufacturing accruals, clinical accruals, fair value of assets and liabilities, income taxes uncertainties, stock-based compensation, and related assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could materially differ from those estimates . Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents, and short-term marketable securities. Cash and cash equivalents are deposited in checking and sweep accounts at financial institutions. Such deposits may, at times, exceed federally insured limits. Cash, Cash Equivalents, and Restricted Cash The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash and cash equivalents. Cash equivalents, which consist of amounts invested in money market funds, are stated at fair value. Restricted cash relates to a letter of credit established for a lease entered into in June 2018. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same amounts shown in the condensed consolidated statements of cash flows: Nine Months Ended 2023 2022 (In thousands) Cash and cash equivalents $ 101,964 $ 184,231 Restricted cash 1,546 1,472 Total cash, cash equivalents, and restricted cash $ 103,510 $ 185,703 Marketable Securities All marketable securities have been classified as “available-for-sale” and are carried at fair value, based upon quoted market prices. The Company considers its available-for-sale portfolio as available for use in current operations. Accordingly, the Company may classify certain investments as short-term marketable securities, even though the stated maturity date may be one year or more beyond the current balance sheet date. For available-for-sale debt securities, unrealized gains, net of any related tax effects, are excluded from earnings and are included in other comprehensive income and reported as a separate component of stockholders’ equity until realized. The Company assesses available-for-sale debt securities on a quarterly basis to see if any unrealized loss is due to credit-related factors. Factors considered in determining whether an impairment is credit-related include the extent to which the investment’s fair value is less than its cost basis, declines in published credit ratings, changes in interest rates, and any other adverse factors related to the security. If it is determined that a credit-related impairment exists, the Company will measure the credit loss based on a discounted cash flows model. Credit-related impairments on available-for-sale debt securities are recognized as an allowance for credit losses with a corresponding adjustment to other income, net in the Company’s consolidated statement of operations. The unrealized loss position that is not credit-related is recorded, net of any related tax effects, in other comprehensive income until realized. There were no credit-related losses recognized for the periods presented. The cost of securities sold is based on the specific-identification method. The amortized cost of securities is adjusted for amortization of premiums and accretion of discounts to maturity. In accordance with our investment policy, management invests in money market funds, U.S. treasury securities, corporate bonds, certificates of deposit, and commercial paper. The Company has not experienced any losses on its deposits of cash, cash equivalents, and marketable securities. Fair Value of Financial Instruments The Company’s financial instruments include cash and cash equivalents, marketable securities, receivable from collaboration partner, current and noncurrent prepaid expenses, accounts payable, and accrued liabilities. The Company’s financial instruments approximate fair value due to their relatively short maturities. The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines the fair value of its financial instruments based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: Level 1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date; Level 2 – Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and Level 3 – Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data. Revenue Recognition The Company recognizes revenue when control of promised goods or services is transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. In determining the appropriate amount of revenue to be recognized as the Company fulfills its obligations under arrangements, the Company performs the following steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies the performance obligation. If it is determined that multiple performance obligations exist, the transaction price is allocated at the inception of the agreement to all identified performance obligations based on the relative standalone selling price (SSP). The relative SSP for each performance obligation is estimated using external sourced evidence if it is available. If external sourced evidence is not available, we use our best estimate of the SSP for the performance obligation. The Company recognizes collaboration revenue at a point in time if control of the promised good or service has been transferred to the customer. The Company recognizes collaboration revenue over time by measuring the progress toward complete satisfaction of the performance obligation using an input measure. In order to recognize revenue over the research and development period, the Company measures actual costs incurred to date compared to the overall total expected costs to satisfy the performance obligation. Revenues are recognized as the program costs are incurred. The Company re-evaluates the estimate of expected costs to satisfy the performance obligation each reporting period. Stock-based Compensation Stock-based compensation is measured on the grant date based on the fair value of the awards. The fair value of options to purchase common stock is measured using the Black-Scholes option-pricing model. Stock-based compensation associated with restricted stock units (RSUs) is based on the fair value of the Company's common stock on the grant date, which equals the closing price of the Company's common stock on the grant date. The Company recognizes expense over the vesting period of the awards. Expense for options and RSUs that vest based only on a service condition is recognized on a straight-line basis. The fair value of RSUs with market conditions is estimated using a Monte Carlo simulation model. Assumptions and estimates utilized in the model include the stock price on grant date, risk-free interest rate, dividend yield, expected stock volatility, and estimated period to achieve the market condition. The expense is recognized based on continued employment of the participants, regardless of achievement of the market condition. Expense related to the RSUs with market conditions is recognized using the accelerated attribution method. The Company accounts for forfeitures as they occur for all awards. Comprehensive Loss Comprehensive loss includes net loss and certain changes in stockholders’ equity that are the result of transactions and economic events other than those with stockholders. The Company’s only element of comprehensive loss was net unrealized gain (loss) on marketable securities. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 3. Fair Value Measurements The following tables summarize the Company’s financial assets measured at fair value on a recurring basis by level within the fair value hierarchy: September 30, 2023 Fair Value Amortized Unrealized Unrealized Fair Market (In thousands) Money market funds Level 1 $ 52,393 $ — $ — $ 52,393 U.S. government treasury securities Level 1 261,340 28 ( 413 ) 260,955 Certificates of deposit Level 2 12,839 2 ( 3 ) 12,838 Commercial paper Level 2 156,998 1 ( 125 ) 156,874 Corporate bonds Level 2 93,123 6 ( 216 ) 92,913 Total cash equivalents and marketable $ 576,693 $ 37 $ ( 757 ) $ 575,973 December 31, 2022 Fair Value Amortized Unrealized Unrealized Fair Market (In thousands) Money market funds Level 1 $ 74,848 $ — $ — $ 74,848 U.S. government treasury securities Level 1 506,372 7 ( 4,569 ) 501,810 Commercial paper Level 2 44,438 2 ( 8 ) 44,432 Corporate bonds Level 2 29,352 4 ( 10 ) 29,346 Total cash equivalents and marketable $ 655,010 $ 13 $ ( 4,587 ) $ 650,436 The Company’s Level 2 securities are valued using third-party pricing sources. The pricing services utilize industry standard valuation models for which all significant inputs are observable. The Company classifies marketable securities available to fund current operations as current assets. As of September 30, 2023 , the remaining contractual maturities of $ 550.5 million of investments were less than one year and $ 25.5 million of investments were after one year through two years. The Company does not intend to sell the investments that are currently in an unrealized loss position, and it is highly unlikely that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be at maturity. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 4. Commitments and Contingencies Contingencies From time to time, the Company may be involved in litigation related to claims that arise in the ordinary course of its business activities. The Company accrues for these matters when it is probable that future expenditures will be made and these expenditures can be reasonably estimated. As of September 30, 2023, the Company does not believe that any such matters, individually or in the aggregate, will have a material adverse effect on the Company’s financial position, results of operations or cash flows. Indemnification The Company enters into customary indemnification arrangements in the ordinary course of business with vendors, clinical trial sites and other parties. Pursuant to these arrangements, the Company indemnifies, holds harmless and agrees to reimburse the indemnified parties for certain losses suffered or incurred by the indemnified party. The term of these indemnification agreements is generally perpetual any time after the execution of the agreement. The maximum potential amount of future payments the Company could be required to make under these arrangements is not determinable. The Company has never incurred costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, the Company has no t recorded a liability related to such indemnification agreements as of September 30, 2023 . |
Collaboration Agreements
Collaboration Agreements | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Collaboration Agreements | 5. Collaboration Agreements GSK On July 1, 2021, the Company entered into a Collaboration and License Agreement with Glaxo Wellcome UK Limited, a subsidiary of GlaxoSmithKline plc (GSK), pursuant to which the Company and GSK collaborate on the global development and commercialization of progranulin-elevating monoclonal antibodies, including latozinemab and AL101 (GSK Agreement). The GSK Agreement became effective on August 17, 2021 . Under the terms of the GSK Agreement, the Company received $ 700 million in upfront payments, of which $ 500 million was received in August 2021 and $ 200 million was received in January 2022 . In addition, based on the development and commercialization plan for latozinemab and AL101, the Company may be eligible to receive up to an additional $ 1.5 billion in clinical development, regulatory, and commercial launch-related milestone payments. In the United States, the Company and GSK will equally share profits and losses from commercialization of latozinemab and AL101. Outside of the United States, the Company will be eligible for double-digit tiered royalties. The Company and GSK will jointly develop latozinemab and AL101 with GSK conducting Phase 3 clinical trials for Alzheimer’s disease, Parkinson’s disease and other non-orphan indications. GSK will also conduct the initial Phase 2 trial for AL101 in Alzheimer’s disease. The Company and GSK will share development costs 60 % by GSK and 40 % by the Company except that subject to the GSK Amendment (defined below), the Company will solely bear the development costs of the initial Phase 2 clinical trials under the development plan, and the parties will share manufacturing development costs equally. In May 2023, the Company and GSK amended the GSK Agreement (GSK Amendment). Under the terms of the GSK Amendment, the Company is responsible for funding and sharing in GSK’s and the Company’s development costs up to $ 140.5 million for the conduct of the initial Phase 2 trial for AL101 in Alzheimer’s disease. The Company assessed the GSK Amendment in accordance with ASC 606 and concluded that the GSK Amendment was a contract modification to the GSK Agreement. Accordingly, the transaction price as of May 2023, was updated from $ 700 million to $ 571.6 million and the difference of $ 128.4 million was recorded as refund liability to collaboration partner for the expected cost reimbursement to GSK. The refund liability is an estimate of variable consideration calculated as the difference between the Company’s maximum funding of $ 140.5 million and the Company’s cost budget estimated using the expected value method. The Company determined that the modified performance obligation for the AL101 Alzheimer’s disease program is performing development activities to support the initial Phase 2 trial, including license rights and know-how. The Company updated the cost-based input measure of progress for the modified performance obligation and recorded a cumulative catch-up adjustment to revenue of $ 26.9 million on the modification date relating to performance obligation which was satisfied in prior periods. As of September 30, 2023, the Company reassessed the estimated refund liability to collaboration partner for the AL101 Alzheimer’s disease program to be $ 3.0 million lower, and accordingly, the Company increased the transaction price by $ 3.0 million. During the three months ended September 30, 2023, as a result of the planned closure of the AL001 Phase 2 trial and concurrent agreement by the Company to cost-share additional R&D, the Company determined there was a modification of the GSK Agreement, resulting in a decrease of the scope of the performance obligation associated with the AL001 FTD- C9orf72 Phase 2 trial and an increase in the amount of R&D cost-shared by the Company in future periods. The impact of this additional cost share was accounted for as a refund liability, which reduced the transaction price for the GSK Agreement by $ 4.2 million. The refund liability is an estimate of variable consideration. The updated transaction price for the GSK Agreement as of September 30, 2023 was $ 570.4 million. The Company determined that the modified performance obligation for the AL001 FTD- C9orf72 indication is performing the first Phase 2 development activities, including license rights and know-how. The Company updated the cost-based input measure of progress for the modified performance obligation and recorded a cumulative catch-up adjustment to revenue of $ 4.9 million on the modification date relating to performance obligation that was satisfied in prior periods. Collaboration revenue under the GSK Agreement during the three and nine months ended September 30, 2023 was $ 7.5 million and $ 56.8 million, respectively, the entire amount of which was included in deferred revenue at the beginning of the period. For the three and nine months ended September 30, 2022 collaboration revenue under the GSK agreement was $ 10.7 million and $ 53.1 million, respectively. The deferred revenue related to the GSK Agreement was $ 258.5 million and $ 444.9 million as of September 30, 2023 and December 31, 2022, respectively. The deferred revenue is expected to be recognized over the research and development period of the programs through the completion of initial Phase 2 clinical trials. For the three months ended September 30, 2023 , we recorded a $ 4.6 million decrease to collaboration revenue under the GSK Agreement due to an increase in total expected costs to satisfy the performance obligations for the AL101 Alzheimer’s disease program. Costs associated with co-development activities performed under the agreement are included in research and development expenses in the condensed consolidated statements of operations, with any reimbursement of costs by GSK reflected as a reduction of such expenses. For the three and nine months ended September 30, 2023 , the Company recognized a reduction of research and development expense of $ 7.8 million and $ 18.8 million, respectively, under the GSK Agreement. For the three and nine months ended September 30, 2022 , the company recognized a reduction of research and development expenses of $ 3.4 million and $ 12.1 million, respectively, under the GSK Agreement. AbbVie The Company entered into an agreement in October 2017 with AbbVie Biotechnology, Ltd. (AbbVie) to co-develop antibodies to two program targets in preclinical development (AbbVie Agreement). Under the terms of the AbbVie Agreement, AbbVie made $ 205.0 million in upfront payments, of which $ 5.0 million and $ 200.0 million were received by the Company in October 2017 and January 2018, respectively. The Company was to perform research and development services for the two programs through the end of Phase 2 clinical trials, which were each considered to be separate performance obligations. AbbVie decided to terminate one of the two collaboration programs, the CD33 collaboration program, after AbbVie and Alector concluded that further development of AL003, the asset being developed under that program, was not warranted. AbbVie provided written notice to terminate the CD33 collaboration program on June 30, 2022. Accordingly, the Company is no longer developing that program and will not be eligible for any future milestones related to that program from AbbVie. The Company continues to develop the AL002 program under the AbbVie Agreement. AbbVie has the exclusive right to exercise an option under the AbbVie Agreement with the Company for $ 250.0 million. If AbbVie exercises its option for the AL002 program, AbbVie would take over development of the product candidate, and the program costs will be split between the parties. The Company would also share in profits and losses upon commercialization of any products. Alternatively, following AbbVie’s exercise of its option for the AL002 program, the Company may opt out of sharing in development costs and profits or losses for that program and instead receive tiered royalties. Additionally, under the terms of the AbbVie Agreement, the Company will be eligible to earn up to an additional $ 225.0 million in milestone payments related to the regulatory approval for up to three indications. The Company assessed its collaboration agreement with AbbVie in the context of the delivery of the research and development services. In February 2023, the Company and AbbVie amended the AbbVie Agreement (AbbVie Amendment), which resulted in the Company receiving a $ 17.8 million milestone payment in March 2023 for the dosing of the first patient in a long-term extension (LTE) trial. In addition, under the terms of the AbbVie Amendment, the Company will be eligible to earn up to an additional $ 12.5 million to support the enrollment of additional patients to replace discontinuations. The performance obligations to conduct the LTE trial and enroll additional patients are not considered distinct from the AL002 program performance obligation. The Company received $ 5.7 million related to the enrollment of additional patients from AbbVie in the third quarter of 2023. The receivable from collaboration partner related to the enrollment of additional patients was $ 6.8 million as of September 30, 2023. The transaction price as of September 30, 2023 included fixed consideration consisting of the upfront payments of $ 205.0 million, the $ 17.8 million LTE milestone payment, and the $ 12.5 million payment for enrollment of additional patients. Collaboration revenue under the AbbVie Agreement during the three months ended September 30, 2023 was $ 1.6 million, the entire amount of which was included in deferred revenue at the beginning of the period. Collaboration revenue under the AbbVie Agreement during the nine months ended September 30, 2023 was $ 25.0 million, $ 6.7 million of which was included in deferred revenue at the beginning of the period. Collaboration revenue for the three and nine months ended September 30, 2022 was $ 4.2 million and $ 66.1 million, respectively. The deferred revenue related to the AbbVie Agreement was $ 51.9 million and $ 46.7 million as of September 30, 2023 and December 31, 2022, respectively. The deferred revenue is expected to be recognized over the research and development period of the AL002 program through the completion of the ongoing Phase 2 and Phase 2 LTE clinical trials. For the three months ended September 30, 2023 , we recorded a $ 5.2 million decrease to collaboration revenue under the AbbVie Agreement due to an increase in total expected costs to satisfy the performance obligation for the AL002 program. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based Compensation | 6. Stock-based Compensation The Company recognized stock-based compensation as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Research and development $ 5,300 $ 4,801 $ 16,269 $ 19,335 General and administrative 4,759 5,964 14,987 15,848 Total stock-based compensation $ 10,059 $ 10,765 $ 31,256 $ 35,183 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 7. Income Taxes For the three and nine months ended September 30, 2023 , the Company's effective tax rate was ( 2.9 )% and ( 4.2 )%, respectively. For the three and nine months ended September 30, 2022 , the Company's effective tax rate was ( 1.3 )% and ( 1.3 )%, respectively. The difference between the effective tax rate as of September 30, 2023 and 2022, respectively, and the U.S. federal statutory rate of 21 % was primarily due to the recognition of a certain amount of current year income tax as a result of the capitalization of research and development expenses under Section 174 of the Internal Revenue Code, effective beginning in 2022. Section 174 of the Internal Revenue Code requires capitalization of research and development expenses to then be amortized over five years for U.S. based research and 15 years for research conducted outside of the U.S., which limits the amount of research and development expenses that can be used to offset income in the current year. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 8. Related Party Transactions In 2014, the Company entered into a collaboration agreement with Adimab, LLC (Adimab) under which the Company is developing antibodies discovered by Adimab in its latozinemab and AL101 programs and is developing antibodies optimized by Adimab in its AL002 program (2014 Adimab Agreement). The 2014 Adimab Agreement also provided for the Company’s development of antibodies optimized by Adimab in its AL003 program, which was terminated in June 2022. In August 2019, the Company signed a collaboration agreement with Adimab for research and development of additional antibodies, the term of which was extended effective August 2022 (2019 Adimab Agreement). In December 2021, the Company signed another collaboration agreement with Adimab for antibody engineering research programs (2021 Adimab Agreement). The 2021 Adimab Agreement expired and the Company did not exercise any option to carry forward any of the results. Tillman Gerngross, Ph.D, the Executive Chairman of the board of directors of Adimab is a co-founder and former director of Alector. Dr. Gerngross resigned as a member of the Company's board of directors, effective June 15, 2023. For the three and nine months ended September 30, 2023 , the Company did no t incur any expenses related to Adimab. For the three and nine months ended September 30, 2022 , the Company incurred expenses of less than $ 0.1 million and $ 0.2 million, respectively. The Company had no accrued liabilities due to Adimab as of September 30, 2023 and December 31, 2022 . Under the 2014 Adimab Agreement, the Company has made milestone payments and will owe low- to mid- single-digit royalty payments for commercial sales of the product candidate. Under the 2019 Adimab Agreement, the Company will owe certain milestone payments and low single-digit royalty payments for commercial sales of any covered product candidates. |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 9. Net Loss Per Share The following outstanding potentially dilutive shares have been excluded from the calculation of diluted net loss per share for the periods presented due to their anti-dilutive effect: Three Months Ended Nine Months Ended 2023 2022 2023 2022 Restricted stock subject to future vesting 3,288,671 1,404,037 3,288,671 1,404,037 Options to purchase common stock 11,848,595 13,185,809 11,848,595 13,185,809 Shares committed under 2019 ESPP 173,878 100,385 173,878 100,385 Total 15,311,144 14,690,231 15,311,144 14,690,231 |
Restructuring
Restructuring | 9 Months Ended |
Sep. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | 10. Restructuring On March 28, 2023, the Company committed to a plan to reduce its workforce by approximately 11 % to better align the Company’s resources with its previously announced strategic prioritization of its late-stage progranulin and TREM2 immuno-neurology programs. The Company initiated a reduction in force impacting approximately 30 employees across the organization effective March 29, 2023. One-time restructuring charges associated with the reduction in force are expected to be approximately $ 1.7 million, primarily consisting of personnel expenses such as salaries, one-time severance payments, and other benefits. For the three and nine months ended September 30, 2023 , the Company incurred restructuring costs of $( 0.1 ) million and $ 1.7 million that were included in operating expenses. Accrued liabilities associated with restructuring costs were $ 0.2 million as of September 30, 2023 . The Company does no t expect to incur additional restructuring costs prior to the end of 2023. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States (GAAP) as defined by the Financial Accounting Standards Board (FASB). In the opinion of management, these unaudited condensed consolidated financial statements include all normal, recurring adjustments that are necessary to present fairly the results of the interim periods presented. The condensed consolidated financial statements include the accounts of Alector, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year. These interim financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2022, and the notes thereto, which are included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on February 28, 2023. |
Use of Estimates | Use of Estimates The preparation 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 revenue and expense during the reporting period. The Company evaluates its estimates, including those related to revenue recognition, manufacturing accruals, clinical accruals, fair value of assets and liabilities, income taxes uncertainties, stock-based compensation, and related assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could materially differ from those estimates . |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents, and short-term marketable securities. Cash and cash equivalents are deposited in checking and sweep accounts at financial institutions. Such deposits may, at times, exceed federally insured limits. |
Cash, Cash Equivalents, and Restricted Cash | Cash, Cash Equivalents, and Restricted Cash The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash and cash equivalents. Cash equivalents, which consist of amounts invested in money market funds, are stated at fair value. Restricted cash relates to a letter of credit established for a lease entered into in June 2018. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same amounts shown in the condensed consolidated statements of cash flows: Nine Months Ended 2023 2022 (In thousands) Cash and cash equivalents $ 101,964 $ 184,231 Restricted cash 1,546 1,472 Total cash, cash equivalents, and restricted cash $ 103,510 $ 185,703 |
Marketable Securities Policy | Marketable Securities All marketable securities have been classified as “available-for-sale” and are carried at fair value, based upon quoted market prices. The Company considers its available-for-sale portfolio as available for use in current operations. Accordingly, the Company may classify certain investments as short-term marketable securities, even though the stated maturity date may be one year or more beyond the current balance sheet date. For available-for-sale debt securities, unrealized gains, net of any related tax effects, are excluded from earnings and are included in other comprehensive income and reported as a separate component of stockholders’ equity until realized. The Company assesses available-for-sale debt securities on a quarterly basis to see if any unrealized loss is due to credit-related factors. Factors considered in determining whether an impairment is credit-related include the extent to which the investment’s fair value is less than its cost basis, declines in published credit ratings, changes in interest rates, and any other adverse factors related to the security. If it is determined that a credit-related impairment exists, the Company will measure the credit loss based on a discounted cash flows model. Credit-related impairments on available-for-sale debt securities are recognized as an allowance for credit losses with a corresponding adjustment to other income, net in the Company’s consolidated statement of operations. The unrealized loss position that is not credit-related is recorded, net of any related tax effects, in other comprehensive income until realized. There were no credit-related losses recognized for the periods presented. The cost of securities sold is based on the specific-identification method. The amortized cost of securities is adjusted for amortization of premiums and accretion of discounts to maturity. In accordance with our investment policy, management invests in money market funds, U.S. treasury securities, corporate bonds, certificates of deposit, and commercial paper. The Company has not experienced any losses on its deposits of cash, cash equivalents, and marketable securities. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments include cash and cash equivalents, marketable securities, receivable from collaboration partner, current and noncurrent prepaid expenses, accounts payable, and accrued liabilities. The Company’s financial instruments approximate fair value due to their relatively short maturities. The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines the fair value of its financial instruments based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: Level 1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date; Level 2 – Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and Level 3 – Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when control of promised goods or services is transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. In determining the appropriate amount of revenue to be recognized as the Company fulfills its obligations under arrangements, the Company performs the following steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies the performance obligation. If it is determined that multiple performance obligations exist, the transaction price is allocated at the inception of the agreement to all identified performance obligations based on the relative standalone selling price (SSP). The relative SSP for each performance obligation is estimated using external sourced evidence if it is available. If external sourced evidence is not available, we use our best estimate of the SSP for the performance obligation. The Company recognizes collaboration revenue at a point in time if control of the promised good or service has been transferred to the customer. The Company recognizes collaboration revenue over time by measuring the progress toward complete satisfaction of the performance obligation using an input measure. In order to recognize revenue over the research and development period, the Company measures actual costs incurred to date compared to the overall total expected costs to satisfy the performance obligation. Revenues are recognized as the program costs are incurred. The Company re-evaluates the estimate of expected costs to satisfy the performance obligation each reporting period. |
Stock-based Compensation | Stock-based Compensation Stock-based compensation is measured on the grant date based on the fair value of the awards. The fair value of options to purchase common stock is measured using the Black-Scholes option-pricing model. Stock-based compensation associated with restricted stock units (RSUs) is based on the fair value of the Company's common stock on the grant date, which equals the closing price of the Company's common stock on the grant date. The Company recognizes expense over the vesting period of the awards. Expense for options and RSUs that vest based only on a service condition is recognized on a straight-line basis. The fair value of RSUs with market conditions is estimated using a Monte Carlo simulation model. Assumptions and estimates utilized in the model include the stock price on grant date, risk-free interest rate, dividend yield, expected stock volatility, and estimated period to achieve the market condition. The expense is recognized based on continued employment of the participants, regardless of achievement of the market condition. Expense related to the RSUs with market conditions is recognized using the accelerated attribution method. The Company accounts for forfeitures as they occur for all awards. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss includes net loss and certain changes in stockholders’ equity that are the result of transactions and economic events other than those with stockholders. The Company’s only element of comprehensive loss was net unrealized gain (loss) on marketable securities. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Reconciliation of Cash, Cash Equivalents, and Restricted Cash | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same amounts shown in the condensed consolidated statements of cash flows: Nine Months Ended 2023 2022 (In thousands) Cash and cash equivalents $ 101,964 $ 184,231 Restricted cash 1,546 1,472 Total cash, cash equivalents, and restricted cash $ 103,510 $ 185,703 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Summary of Financial Assets Measured at Fair Value on a Recurring Basis | The following tables summarize the Company’s financial assets measured at fair value on a recurring basis by level within the fair value hierarchy: September 30, 2023 Fair Value Amortized Unrealized Unrealized Fair Market (In thousands) Money market funds Level 1 $ 52,393 $ — $ — $ 52,393 U.S. government treasury securities Level 1 261,340 28 ( 413 ) 260,955 Certificates of deposit Level 2 12,839 2 ( 3 ) 12,838 Commercial paper Level 2 156,998 1 ( 125 ) 156,874 Corporate bonds Level 2 93,123 6 ( 216 ) 92,913 Total cash equivalents and marketable $ 576,693 $ 37 $ ( 757 ) $ 575,973 December 31, 2022 Fair Value Amortized Unrealized Unrealized Fair Market (In thousands) Money market funds Level 1 $ 74,848 $ — $ — $ 74,848 U.S. government treasury securities Level 1 506,372 7 ( 4,569 ) 501,810 Commercial paper Level 2 44,438 2 ( 8 ) 44,432 Corporate bonds Level 2 29,352 4 ( 10 ) 29,346 Total cash equivalents and marketable $ 655,010 $ 13 $ ( 4,587 ) $ 650,436 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Recognized Stock-Based Compensation | The Company recognized stock-based compensation as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Research and development $ 5,300 $ 4,801 $ 16,269 $ 19,335 General and administrative 4,759 5,964 14,987 15,848 Total stock-based compensation $ 10,059 $ 10,765 $ 31,256 $ 35,183 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Dilutive Shares Excluded from Calculation of Diluted Net Loss Per Share | The following outstanding potentially dilutive shares have been excluded from the calculation of diluted net loss per share for the periods presented due to their anti-dilutive effect: Three Months Ended Nine Months Ended 2023 2022 2023 2022 Restricted stock subject to future vesting 3,288,671 1,404,037 3,288,671 1,404,037 Options to purchase common stock 11,848,595 13,185,809 11,848,595 13,185,809 Shares committed under 2019 ESPP 173,878 100,385 173,878 100,385 Total 15,311,144 14,690,231 15,311,144 14,690,231 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Accounting Policies [Abstract] | |
Credit losses on marketable securities | $ 0 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Reconciliation of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 101,964 | $ 154,323 | $ 184,231 | |
Restricted cash | 1,546 | 1,472 | 1,472 | |
Total cash, cash equivalents, and restricted cash | $ 103,510 | $ 155,795 | $ 185,703 | $ 330,624 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Financial Assets Measured at Fair Value on a Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Money Market Funds | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents and marketable securities, Amortized Cost | $ 52,393 | $ 74,848 |
Cash equivalents and marketable securities, Unrealized Gains | 0 | 0 |
Cash equivalents and marketable securities, Unrealized Losses | 0 | 0 |
Cash equivalents and marketable securities, Fair Market Value | 52,393 | 74,848 |
U.S Government Treasury Securities | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents and marketable securities, Amortized Cost | 261,340 | 506,372 |
Cash equivalents and marketable securities, Unrealized Gains | 28 | 7 |
Cash equivalents and marketable securities, Unrealized Losses | (413) | (4,569) |
Cash equivalents and marketable securities, Fair Market Value | 260,955 | 501,810 |
Certificates of Deposit [Member] | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents and marketable securities, Amortized Cost | 12,839 | |
Cash equivalents and marketable securities, Unrealized Gains | 2 | |
Cash equivalents and marketable securities, Unrealized Losses | (3) | |
Cash equivalents and marketable securities, Fair Market Value | 12,838 | |
Commercial Paper [Member] | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents and marketable securities, Amortized Cost | 156,998 | 44,438 |
Cash equivalents and marketable securities, Unrealized Gains | 1 | 2 |
Cash equivalents and marketable securities, Unrealized Losses | (125) | (8) |
Cash equivalents and marketable securities, Fair Market Value | 156,874 | 44,432 |
Corporate Bonds | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents and marketable securities, Amortized Cost | 93,123 | 29,352 |
Cash equivalents and marketable securities, Unrealized Gains | 6 | 4 |
Cash equivalents and marketable securities, Unrealized Losses | (216) | (10) |
Cash equivalents and marketable securities, Fair Market Value | 92,913 | 29,346 |
Cash Equivalents and Marketable Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents and marketable securities, Amortized Cost | 576,693 | 655,010 |
Cash equivalents and marketable securities, Unrealized Gains | 37 | 13 |
Cash equivalents and marketable securities, Unrealized Losses | (757) | (4,587) |
Cash equivalents and marketable securities, Fair Market Value | $ 575,973 | $ 650,436 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) $ in Millions | Sep. 30, 2023 USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Remaining contractual maturities of investments were less than one year | $ 550.5 |
Remaining contractual maturities, one year through two years | $ 25.5 |
Commitment and Contingencies -
Commitment and Contingencies - Addtional Information (Details) | Sep. 30, 2023 USD ($) |
Loss Contingencies [Line Items] | |
Indemnification agreement liability | $ 0 |
Collaboration Agreements - Addi
Collaboration Agreements - Additional Information (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||
Aug. 17, 2021 USD ($) | Jul. 01, 2021 USD ($) | May 31, 2023 USD ($) | Mar. 31, 2023 USD ($) | Jan. 31, 2022 USD ($) | Jan. 31, 2018 USD ($) | Oct. 31, 2017 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Feb. 28, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Research and development expense | $ 46,328 | $ 48,348 | $ 144,392 | $ 155,925 | |||||||||
GlaxoSmithKline plc | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Effective date of agreement | Aug. 17, 2021 | ||||||||||||
Upfront payments | $ 700,000 | ||||||||||||
Milestone payment received | $ 500,000 | $ 200,000 | |||||||||||
Percentage of development cost | 0.60 | ||||||||||||
Collaboration revenue | 7,500 | 10,700 | $ 56,800 | 53,100 | |||||||||
Deferred revenue | 258,500 | 258,500 | $ 444,900 | ||||||||||
Research and development expense | 7,800 | 3,400 | 18,800 | 12,100 | |||||||||
Reduction in transaction price | 4,200 | 4,200 | |||||||||||
Transaction price | $ 571,600 | 570,400 | 570,400 | ||||||||||
Contract with customer, refund liability | 128,400 | 128,400 | |||||||||||
Maximum funding | 140,500 | ||||||||||||
Cumulative adjustment to revenue | $ 26,900 | 4,900 | |||||||||||
GlaxoSmithKline plc | Al101 Alzheimer's Disease Program | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Transaction price | 3,000 | 3,000 | |||||||||||
Contract with customer, refund liability | 3,000 | 3,000 | |||||||||||
GlaxoSmithKline plc | Maximum | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Additional milestone payments related to initiation of certain clinical studies and regulatory approval | 1,500,000 | $ 1,500,000 | |||||||||||
Transaction price | $ 700,000 | ||||||||||||
GlaxoSmithKline plc | Change in Estimate [Member] | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Collaboration revenue | 4,600 | ||||||||||||
Alector | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Percentage of development cost | 0.40 | ||||||||||||
AbbVie Biotechnology Limited | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Upfront payments | $ 205,000 | $ 205,000 | |||||||||||
Milestone payment received | $ 17,800 | $ 200,000 | 5,000 | 5,700 | 17,800 | ||||||||
Exclusive option rights exercised for each program | 250,000 | ||||||||||||
Additional milestone payments related to initiation of certain clinical studies and regulatory approval | 6,800 | 6,800 | |||||||||||
Collaboration revenue | 1,600 | $ 4,200 | 25,000 | $ 66,100 | |||||||||
Deferred revenue | 51,900 | 51,900 | $ 46,700 | ||||||||||
Payment for enrollment of additional patients | 12,500 | 12,500 | |||||||||||
AbbVie Biotechnology Limited | Maximum | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Additional milestone payments related to initiation of certain clinical studies and regulatory approval | $ 225,000 | $ 12,500 | |||||||||||
AbbVie Biotechnology Limited | Deferred Revenue | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Collaboration revenue | $ 6,700 | ||||||||||||
AbbVie Biotechnology Limited | Change in Estimate [Member] | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Collaboration revenue | $ 5,200 |
Stock-based Compensation - Summ
Stock-based Compensation - Summary of Recognized Stock-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 10,059 | $ 10,765 | $ 31,256 | $ 35,183 |
General and Administrative | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | 4,759 | 5,964 | 14,987 | 15,848 |
Research and Development | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 5,300 | $ 4,801 | $ 16,269 | $ 19,335 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Federal statutory income tax rate | 21% | |||
Effective tax rate | (2.90%) | (1.30%) | (4.20%) | (1.30%) |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - Related Party [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Adimab | |||||
Related Party Transaction [Line Items] | |||||
Accrued liabilities due to related parties | $ 0 | $ 0 | $ 0 | ||
Two Thousand Fourteen Adimab Agreement | |||||
Related Party Transaction [Line Items] | |||||
Related party transaction expenses | $ 0 | $ 0.1 | $ 0 | $ 0.2 |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Dilutive Shares Excluded from Calculation of Diluted Net Loss Per Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive shares | 15,311,144 | 14,690,231 | 15,311,144 | 14,690,231 |
Restricted Stock subject to future vesting | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive shares | 3,288,671 | 1,404,037 | 3,288,671 | 1,404,037 |
Options to Purchase Common Stock | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive shares | 11,848,595 | 13,185,809 | 11,848,595 | 13,185,809 |
Shares Committed Under 2019 ESPP | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive shares | 173,878 | 100,385 | 173,878 | 100,385 |
Restructuring - Additional Info
Restructuring - Additional Information (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 29, 2023 USD ($) Employees | Sep. 30, 2023 USD ($) | Sep. 30, 2023 USD ($) | Mar. 28, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||||
Percentage of reduction in workforce | 11% | |||
Number of reduction in workforce | Employees | 30 | |||
Restructuring Charges | $ 1.7 | |||
Accrued liabilities associated with restructuring costs | $ 0.2 | $ 0.2 | ||
Additional restructuring cost expected | 0 | 0 | ||
Operating Expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring costs incurred | $ (0.1) | $ 1.7 |