Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2023 | Oct. 31, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 | |
Entity Registrant Name | Crinetics Pharmaceuticals, Inc. | |
Entity Central Index Key | 0001658247 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity File Number | 001-38583 | |
Entity Tax Identification Number | 26-3744114 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 10222 Barnes Canyon Road | |
Entity Address, Address Line Two | Bldg. #2 | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92121 | |
City Area Code | 858 | |
Local Phone Number | 450-6464 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | CRNX | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 66,799,257 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 142,795 | $ 32,672 |
Investment securities | 411,858 | 301,753 |
Prepaid expenses and other current assets | 21,107 | 10,759 |
Total current assets | 575,760 | 345,184 |
Property and equipment, net | 9,764 | 3,500 |
Operating lease right-of-use assets | 48,042 | 1,486 |
Derivative asset | 0 | 668 |
Investment in Radionetics | 4,671 | 0 |
Restricted cash | 1,300 | 1,301 |
Other assets | 2,000 | 37 |
Total assets | 641,537 | 352,176 |
Current liabilities: | ||
Accounts payable and accrued expenses | 21,935 | 15,351 |
Accrued compensation and related expenses | 12,877 | 9,081 |
Deferred revenue | 1,662 | 2,240 |
Operating lease liability | 3,989 | 1,051 |
Total current liabilities | 40,463 | 27,723 |
Operating lease liability, non-current | 48,182 | 2,024 |
Deferred revenue, non-current | 5,144 | 6,101 |
Total liabilities | 93,789 | 35,848 |
Commitments and contingencies (Note 7) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par; 10,000 shares authorized; no shares issued or outstanding on September 30, 2023 or December 31, 2022 | 0 | 0 |
Common stock and paid-in capital, $0.001 par; 200,000 shares authorized; 66,708 shares issued and outstanding on September 30, 2023; 53,877 shares issued and outstanding on December 31, 2022 | 1,142,218 | 759,432 |
Accumulated other comprehensive loss | (865) | (3,931) |
Accumulated deficit | (593,605) | (439,173) |
Total stockholders’ equity | 547,748 | 316,328 |
Total liabilities and stockholders’ equity | $ 641,537 | $ 352,176 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock and paid-in capital, par value | $ 0.001 | $ 0.001 |
Common stock and paid-in capital, shares authorized | 200,000,000 | 200,000,000 |
Common stock and paid-in capital, shares issued | 66,708,000 | 53,877,000 |
Common stock and paid-in capital, shares outstanding | 66,708,000 | 53,877,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
Revenues | $ 346 | $ 458 | $ 4,013 | $ 4,028 |
Operating expenses: | ||||
Research and development | 43,839 | 31,987 | 122,947 | 93,234 |
General and administrative | 15,484 | 11,925 | 41,016 | 31,120 |
Total operating expenses | 59,323 | 43,912 | 163,963 | 124,354 |
Loss from operations | (58,977) | (43,454) | (159,950) | (120,326) |
Other income (expense): | ||||
Interest income | 2,569 | 1,500 | 6,714 | 2,413 |
Other expense, net | (53) | 29 | (199) | (35) |
Change in valuation of derivative asset | 0 | 0 | 0 | 31 |
Total other income, net | 2,516 | 1,529 | 6,515 | 2,409 |
Loss before equity method investment | (56,461) | (41,925) | (153,435) | (117,917) |
Loss on equity method investment | (997) | 0 | (997) | (1,010) |
Net loss | $ (57,458) | $ (41,925) | $ (154,432) | $ (118,927) |
Net loss per share: | ||||
Net loss per share - basic | $ (1.01) | $ (0.78) | $ (2.81) | $ (2.32) |
Net loss per share - diluted | $ (1.01) | $ (0.78) | $ (2.81) | $ (2.32) |
Weighted average shares - basic | 56,808 | 53,768 | 55,003 | 51,356 |
Weighted average shares - diluted | 56,808 | 53,768 | 55,003 | 51,356 |
Other comprehensive income (loss): | ||||
Unrealized gain (loss) on investment securities | $ 840 | $ (1,391) | $ 3,066 | $ (4,628) |
Comprehensive loss | $ (56,618) | $ (43,316) | $ (151,366) | $ (123,555) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Common stock and Paid-In Capital | Accumulated Other Comprehensive Income (loss) | Accumulated Deficit |
Beginning Balance at Dec. 31, 2021 | $ 331,944 | $ 607,581 | $ (382) | $ (275,255) | |
Beginning Balance, Shares at Dec. 31, 2021 | 47,597,000 | ||||
Issuance of common stock, net of transaction costs, shares | 5,626,000 | ||||
Issuance of common stock, net of transaction costs, value | 117,242 | 117,242 | |||
Stock issued under Employee Stock Purchase Plan, shares | 66,000 | ||||
Stock issued under employee stock purchase plan, value | 813 | 813 | |||
Vesting of shares subject to repurchase | 2 | 2 | |||
Vesting of shares subject to repurchase, shares | 1,000 | ||||
Exercise of stock options | 4,606 | 4,606 | |||
Exercise of stock options, shares | 506,000 | ||||
Stock-based compensation | 20,320 | 20,320 | |||
Comprehensive loss | (4,628) | (4,628) | |||
Net Income (Loss) | (118,927) | (118,927) | |||
Ending Balance at Sep. 30, 2022 | 351,372 | 750,564 | (5,010) | (394,182) | |
Ending Balance, Shares at Sep. 30, 2022 | 53,796,000 | ||||
Beginning Balance at Jun. 30, 2022 | $ 386,165 | 742,041 | (3,619) | (352,257) | |
Beginning Balance, Shares at Jun. 30, 2022 | 53,720,000 | ||||
Stock issued under Employee Stock Purchase Plan, shares | 0 | ||||
Exercise of stock options | $ 1,089 | 1,089 | |||
Exercise of stock options, shares | 76,000 | ||||
Stock-based compensation | 7,434 | 7,434 | |||
Comprehensive loss | (1,391) | (1,391) | |||
Net Income (Loss) | (41,925) | (41,925) | |||
Ending Balance at Sep. 30, 2022 | 351,372 | 750,564 | (5,010) | (394,182) | |
Ending Balance, Shares at Sep. 30, 2022 | 53,796,000 | ||||
Beginning Balance at Dec. 31, 2022 | 316,328 | 759,432 | (3,931) | (439,173) | |
Beginning Balance, Shares at Dec. 31, 2022 | 53,877,000 | ||||
Issuance of common stock, net of transaction costs, shares | 11,965,000 | ||||
Issuance of common stock, net of transaction costs, value | 339,812 | 339,812 | |||
Stock issued under Employee Stock Purchase Plan, shares | 75,000 | ||||
Issuance of common stock upon vesting of restricted stock units shares | 81,000 | ||||
Stock issued under employee stock purchase plan, value | 1,123 | 1,123 | |||
Exercise of stock options | $ 12,531 | 12,531 | |||
Exercise of stock options, shares | 710,020 | 710,000 | |||
Stock-based compensation | $ 29,320 | 29,320 | |||
Comprehensive loss | (3,066) | (3,066) | |||
Net Income (Loss) | (154,432) | (154,432) | |||
Ending Balance at Sep. 30, 2023 | 547,748 | 1,142,218 | (865) | (593,605) | |
Ending Balance, Shares at Sep. 30, 2023 | 66,708,000 | ||||
Beginning Balance at Jun. 30, 2023 | 254,116 | 791,968 | (1,705) | (536,147) | |
Beginning Balance, Shares at Jun. 30, 2023 | 54,682,000 | ||||
Issuance of common stock, net of transaction costs, shares | 11,442,000 | ||||
Issuance of common stock, net of transaction costs, value | $ 328,501 | 328,501 | |||
Stock issued under Employee Stock Purchase Plan, shares | 0 | ||||
Exercise of stock options | $ 10,700 | 10,700 | |||
Exercise of stock options, shares | 584,000 | ||||
Stock-based compensation | 11,049 | 11,049 | |||
Comprehensive loss | (840) | (840) | |||
Net Income (Loss) | (57,458) | (57,458) | |||
Ending Balance at Sep. 30, 2023 | $ 547,748 | $ 1,142,218 | $ (865) | $ (593,605) | |
Ending Balance, Shares at Sep. 30, 2023 | 66,708,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Stockholders' Equity [Abstract] | |||
Transaction cost on issuance | $ 21.5 | $ 21.8 | $ 7.8 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Operating activities: | ||
Net Income (Loss) | $ (154,432) | $ (118,927) |
Reconciliation of net loss to net cash used in operating activities: | ||
Stock-based compensation | 29,320 | 20,320 |
Depreciation and amortization | 836 | 703 |
Noncash lease expense | 425 | 298 |
Accretion of purchase discounts and amortization of premiums on investment securities, net | (2,687) | 385 |
Loss on equity method investment | 997 | 1,010 |
Loss on disposal of property and equipment | 6 | 0 |
Change in valuation of derivative asset | 0 | (31) |
Noncash license revenues | (2,000) | 0 |
Increase (decrease) in cash resulting from changes in: | ||
Prepaid expenses and other assets | (8,368) | 1,052 |
Accounts payable and accrued expenses | 10,457 | 6,911 |
Deferred revenue | (1,535) | 8,972 |
Operating lease liabilities | (811) | (691) |
Net cash used in operating activities | (127,792) | (79,998) |
Investing activities: | ||
Purchases of investment securities | (354,806) | (296,256) |
Purchase of investment in Radionetics preferred stock | (5,000) | 0 |
Maturities of investment securities | 250,454 | 86,805 |
Purchases of property and equipment | (3,753) | (1,382) |
Net cash used in investing activities | (113,105) | (210,833) |
Financing activities: | ||
Proceeds from issuance of common stock, net of $21.8 million (2023) and $7.8 million (2022) of transaction costs | 340,267 | 117,242 |
Proceeds from exercise of stock options | 10,752 | 4,606 |
Net cash provided by financing activities | 351,019 | 121,848 |
Net change in cash, cash equivalents and restricted cash | 110,122 | (168,983) |
Cash, cash equivalents and restricted cash at beginning of period | 33,973 | 201,195 |
Cash, cash equivalents and restricted cash at end of period | 144,095 | 32,212 |
Components of cash, cash equivalents and restricted cash: | ||
Cash and cash equivalents | 142,795 | 30,912 |
Restricted cash | 1,300 | 1,300 |
Cash, cash equivalents and restricted cash at end of period | 144,095 | 32,212 |
Noncash investing and financing activities: | ||
Stock received under licensing arrangement | 2,000 | 0 |
Exercise of Derivative asset for Investment in Radionetics common stock | 668 | 0 |
Change in unvested stock liability | 0 | 2 |
Stock issued under Employee Stock Purchase Plan | 1,123 | 813 |
Right of use assets obtained in exchange for lease obligation | 46,981 | 0 |
Leasehold improvements paid by the lessor | 2,925 | 0 |
Stock options exercised receivable | 1,779 | 0 |
Accrued financing costs | 455 | 0 |
Amounts accrued for purchases of property and equipment | $ 427 | $ 60 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Cash Flows [Abstract] | ||
Proceeds from issuance of common stock, net | $ 21.8 | $ 7.8 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ (57,458) | $ (41,925) | $ (154,432) | $ (118,927) |
Insider Trading Arrangements
Insider Trading Arrangements | 9 Months Ended |
Sep. 30, 2023 shares | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | Rule 10b5-1 Trading Plans On August 25, 2023 , Stephen Betz , Ph.D, Chief Scientific Officer , adopted a Rule 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 40,035 shares of our common stock until September 15, 2024 . On September 25, 2023 , Dana Pizzuti , M.D., Chief Development Officer , adopted a Rule 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 57,500 shares of our common stock until December 31, 2024 . None of our officers (as defined in Rule 16a–1(f)) or directors terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement, as each such term is defined in Item 408 of Regulation S-K. |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Stephen Betz [Member] | |
Trading Arrangements, by Individual | |
Name | Stephen Betz |
Title | Ph.D, Chief Scientific Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | On August 25, 2023 |
Termination Date | September 15, 2024 |
Aggregate Available | 40,035 |
Dana Pizzuti [Member] | |
Trading Arrangements, by Individual | |
Name | Dana Pizzuti |
Title | M.D., Chief Development Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | On September 25, 2023 |
Termination Date | December 31, 2024 |
Aggregate Available | 57,500 |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | 1. ORGANIZATION AND BASIS OF PRESENTATION Description of Business Crinetics Pharmaceuticals, Inc. (the “Company”) is a clinical-stage pharmaceutical company incorporated in Delaware on November 18, 2008, and based in San Diego, California. The Company is focused on the discovery, development, and commercialization of novel therapeutics for rare endocrine diseases and endocrine-related tumors. In January 2017, the Company established a wholly owned Australian subsidiary, Crinetics Australia Pty Ltd (“CAPL”), in order to conduct various preclinical and clinical activities for its development candidates. Unaudited Interim Financial Information The accompanying interim condensed consolidated balance sheet as of September 30, 2023, the condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2023 and 2022, the condensed consolidated statements of stockholders’ equity for the three and nine months ended September 30, 2023 and 2022, and the condensed consolidated statements of cash flows for the nine months ended September 30, 2023 and 2022, and the related disclosures are unaudited. In management’s opinion, the unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of September 30, 2023 and the results of its operations and cash flows for the nine months ended September 30, 2023 and 2022 in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The results for the three and nine months ended September 30, 2023 are not necessarily indicative of the results expected for the full fiscal year or any other interim period. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2022, included in our Annual Report on Form 10-K filed with the SEC on February 28, 2023. The condensed consolidated balance sheet as of December 31, 2022, has been derived from the audited consolidated financial statements as of that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. Principles of Consolidation and Foreign Currency Transactions The condensed consolidated financial statements include the accounts of the Company and CAPL. All intercompany accounts and transactions have been eliminated in consolidation. The functional currency of both the Company and CAPL is the U.S. dollar. Assets and liabilities that are not denominated in the functional currency are remeasured into U.S. dollars at foreign currency exchange rates in effect at the balance sheet date except for nonmonetary assets, which are remeasured at historical foreign currency exchange rates in effect at the date of transaction. Net realized and unrealized gains and losses from foreign currency transactions and remeasurement are reported in other income (expense), in the condensed consolidated statements of operations and were not material for all periods presented. Segment Reporting Operating segments are identified as components of an enterprise about which discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business in one operating segment. Liquidity From inception, the Company has devoted substantially all of its efforts to drug discovery and development, and conducting preclinical studies and clinical trials. The Company has a limited operating history, and the sales and income potential of the Company’s business and market are unproven. Successful transition to attaining profitable operations is dependent upon achieving a level of revenues adequate to support the Company’s cost structure. The Company has experienced net losses and negative cash flows from operating activities since its inception and has an accumulated deficit o f $ 593.6 m illion as of September 30, 2023. As of September 30, 2023, the Com pany had $ 554.7 million i n unrestricted cash, cash equivalents and investment securities, which the Company believes is sufficient to meet its funding requirements for at least the next 12 months. The Company expects to continue to incur net losses for the foreseeable future and believes it will need to raise substantial additional capital to accomplish its business plan over the next several years. The Company plans to continue to fund its losses from operations and capital funding needs through a combination of equity offerings, debt financings or other sources, including potential collaborations, licenses, and other similar arrangements. If the Company is not able to secure adequate additional funding, the Company may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, or suspend or curtail planned programs. Any of these actions could materially harm the Company’s business, results of operations and prospects. There can be no assurance as to the availability or terms upon which such financing and capital might be available in the future. |
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 Use of Estimates The Company’s condensed consolidated financial statements are prepared in accordance with GAAP. The preparation of the Company’s condensed consolidated financial statements requires it to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in the Company’s condensed consolidated financial statements and accompanying notes. The most significant estimates in the Company’s condensed consolidated financial statements relate to accrual of research and development expenses, valuation of stock-based awards, fair values of financial instruments, revenue recognition, investment in Radionetics, and the assumptions underlying the determination of the estimated incremental borrowing rate for the determination of the Company’s operating lease right-of-use assets. Estimates are based on historical experiences or on forecasts, including information received from third parties and various other factors that the Company believes are reasonable under the circumstances. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Actual results could differ from those estimates. Investment in Radionetics In October 2021, the Company, together with 5AM Ventures ("5AM") and Frazier Healthcare Partners ("Frazier"), announced the formation of Radionetics Oncology, Inc. ("Radionetics"). The Company first analyzes its investment in another entity to determine if the entity is a variable interest entity (“VIE”) and if so, whether the Company is the primary beneficiary requiring consolidation. An entity is considered a VIE if (1) the entity does not have enough equity to finance its own activities without additional support, (2) the entity’s at-risk equity holders lack the characteristics of a controlling financial interest, or (3) the entity is structured with non-substantive voting rights. VIEs are consolidated by the primary beneficiary, which is the entity that has both the power to direct the activities that most significantly impact the VIE’s economic performance and the obligation to absorb losses or the right to receive benefits from the VIE that potentially could be significant to the VIE. Variable interests in a VIE can be contractual, ownership, or other financial interests. The Company re-assesses its investment upon reconsideration events to determine whether the Company is the primary beneficiary of the VIE, in which case the Company would consolidate the VIE. If it has been determined that the Company is not the primary beneficiary but does have the ability to exercise significant influence over the VIE, the Company accounts for the unconsolidated investment under the equity method of accounting. Fair Value Measurements The accounting guidance defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or non-recurring basis. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Observable inputs such as quoted prices in active markets. Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions about risk and the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The carrying amounts of the Company’s current financial assets, restricted cash and current financial liabilities are considered to be representative of their respective fair values because of the short-term nature of those instruments. The Company recorded the derivative asset (see Note 11 ) and investment securities (see Note 4) at fair value. Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents include cash held in readily available checking and money market accounts, as well as short-term debt securities with maturities of three months or less when purchased. Restricted cash represents cash held as collateral for the Company’s facility leases and is reported as a long-term asset in the accompanying condensed consolidated balance sheets. Cash and cash equivalents are considered Level 1 investments. Investment Securities All investments have been classified as “available-for-sale” and are carried at fair value as determined based upon quoted market prices or pricing models for similar securities at period end. Investments with contractual maturities less than 12 months at the balance sheet date are considered short-term investments. Investments with contractual maturities beyond one year are also classified as short-term due to the Company’s ability to liquidate the investment for use in operations within the next 12 months. Realized gains and losses on investment securities are derived using the specific identification method for determining the cost of securities sold and are included in other income (expenses), net in the accompanying condensed consolidated statements of operations and comprehensive loss. The Company has not realized any significant gains or losses on sales of available-for-sale debt securities during any of the periods presented. Interest income is recognized when earned and is included in interest income in the accompanying condensed consolidated statements of operations and comprehensive loss, as are the amortization of purchase premiums and accretion of purchase discounts on investment securities. Effective January 1, 2023, at each balance sheet date, the Company assesses available-for-sale debt securities in an unrealized loss position to determine whether the unrealized loss or any potential credit losses should be recognized in net loss. For available-for-sale debt securities in an unrealized loss position, the Company first assesses whether it intends to sell, or it is more likely than not that it will be required to sell, the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through net loss. For available-for-sale securities that do not meet the criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, the Company considers the severity of the impairment, any changes in interest rates, underlying credit ratings, and forecasted recovery, among other factors. The credit-related portion of unrealized losses, and any subsequent improvements, are recorded as an allowance in interest income. There have been no impairment or credit losses recognized during the periods presented in the accompanying condensed consolidated statements of operations and comprehensive loss. Concentrations of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents and investment securities. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash balances due to the financial position of the depository institution in which those deposits are held. Additionally, the Company has established guidelines regarding approved investments and maturities of investments, which are designed to maintain safety and liquidity. Leases The Company determines if an arrangement is a lease at the inception of the arrangement. Leases with a term longer than 12 months that are determined to be operating leases are included in operating lease right-of-use assets, operating lease liabilities and noncurrent operating lease liabilities in the condensed consolidated balance sheets at the accounting commencement date of the arrangement. The Company accounts for each separate lease and non-lease component as a single lease component. When the Company’s leases do not provide an implicit rate, an incremental borrowing rate is used based on the information available at accounting commencement dates in determining the present value of lease payments. The incremental borrowing rate is the rate of interest that the Company would expect to pay to borrow over a similar term, and on a collateralized basis, an amount equal to the lease payments in a similar economic environment. The Company’s lease terms may include options to extend or terminate the lease when the Company is reasonably certain that it will exercise such options. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Lease agreements may contain variable costs such as common area maintenance, insurance, taxes, or other costs. Such variable lease costs are expensed as incurred. The Company assesses its leases to determine whether the arrangements contain lease incentives. Property and Equipment, Net Property and equipment consist of leasehold improvements, and lab and various other equipment. Such assets are stated at cost and depreciated on a straight-line basis over the estimated useful life of the related assets. The Company estimates its useful lives of its lab and other equipment as follows: lab equipment – three to five years; office equipment - three to five years; computer and software – three years. Leasehold improvements are amortized over the estimated useful life of the improvement or the remaining term of the associated lease. Repairs and maintenance costs are charged to expense as incurred and expenditures that materially extend the useful lives of assets are capitalized. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets (or asset group) may not be fully recoverable. Factors considered in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends, and significant changes or planned changes in the use of the assets. An impairment loss is recognized when estimated undiscounted future cash flows expected to result from the use of an asset (or asset group) are less than its carrying amount. If such assets are considered impaired, the impairment loss recognized is measured as the excess of the carrying value of the impaired asset over its fair value, determined based on future cash flows or appraised values, depending on the nature of the asset (or asset group). The Company has not recognized any impairment losses in any of the periods presented in these consolidated financial statements. Revenue Recognition The Company has generated revenue from licensing arrangements and supply agreements. The Company recognizes revenues when, or as, the promised goods or services are transferred to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those services. To determine revenue recognition for arrangements, the Company performs the following five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligation(s) in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligation(s) in the contract; and (5) recognize revenue when (or as) the performance obligation(s) are satisfied. At contract inception, the Company assesses the goods or services promised within each contract, assesses whether each promised good or service is distinct and identifies those that are performance obligations. The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when, or as, the performance obligation is satisfied. The Company has entered into licensing and collaboration agreements that mainly include the following: (i) upfront considerations; (ii) payments associated with achieving certain milestones; and (iii) royalties based on specified percentages of net product sales, if any. The Company has also entered into a manufacturing and supply arrangement that includes reimbursements of costs plus a pre-determined margin. At the initiation of an agreement, the Company analyzes each unit of account within the contract to determine if the counterparty is a customer in the context of the unit of account. The Company considers a variety of factors in determining the appropriate estimates and assumptions under the arrangements, such as whether the elements are distinct performance obligations, whether there are observable standalone prices, whether the license is functional or symbolic, and whether the Company is acting as the agent or principal. The Company evaluates each performance obligation to determine if it can be satisfied and recognized as revenue at a point in time or over time. At the inception of arrangements that include variable consideration, the Company uses judgment to estimate the amount of variable consideration to include in the transaction price using the most likely method. If it is probable that a significant revenue reversal will not occur, then the estimated amount is included in the transaction price. Milestone payments that are not within the Company's or the licensee’s control, such as regulatory approvals, are not included in the transaction price until those approvals are received. At the end of each reporting period, the Company re-evaluates the estimated variable consideration included in the transaction price and any related constraint and, as necessary, adjusts the estimate of the overall transaction price. Any adjustments will be recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. The Company develops estimates of the standalone selling price for each distinct performance obligation. Variable consideration that relates specifically to efforts to satisfy specific performance obligations is allocated entirely to those performance obligations. Other components of the transaction price are allocated based on the relative standalone selling price, over which management has applied significant judgment. The Company determines the standalone selling price for license-related performance obligations using a market approach, which may include assumptions such as forecasted revenues, development timelines, discount rates and probabilities of success. The Company estimates the standalone selling price for the data exchange performance obligation (see Note 8) by forecasting the expected costs of satisfying a performance obligation plus a predetermined margin. In the case of a license that is a distinct performance obligation, the Company recognizes revenue allocated to the license from non-refundable, up-front fees at the point in time when the license is transferred to the licensee and the licensee can use and benefit from the license. For licenses that are bundled with other distinct or combined obligations, the Company uses judgment to assess the nature of the performance obligation to determine whether the performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. If the performance obligation is satisfied over time, then the Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The selection of the method to measure progress towards completion requires judgment and is based on the nature of the products or services to be provided. The Company has used the cost-to-cost measure of progress because it best depicts the transfer of control to the customer which occurs as the Company incurs costs. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation, which is considered an input method. The Company uses judgment to estimate the total cost of these performance obligations, which include subcontractors' costs, labor, materials, other direct costs, and an allocation of indirect costs. The Company evaluates these cost estimates and the progress each reporting period and, as necessary, the Company adjusts the measure of progress and related revenue recognition. Sales-based milestones and royalties are recognized at the later of when the subsequent sale or usage occurs or the performance obligation for which some or all of the sales-based milestones and royalties have been allocated to has been satisfied or partially satisfied. Research and Development Expenses Research and development (“R&D”) expenses consist primarily of salaries, payroll taxes, employee benefits and stock-based compensation for individuals involved in R&D efforts, as well as consulting expenses, third-party R&D expenses, laboratory supplies, clinical materials and overhead, including facilities and depreciation costs, offset by the Australian Tax Incentive discussed below. R&D expenses are charged to expense as incurred. Payments made prior to the receipt of goods or services to be used in R&D are capitalized until the goods or services are received and are recorded as prepaid expenses and other current assets. Costs incurred under contracts with contract research organizations that conduct and manage the Company’s clinical trials are also included in R&D expenses. The financial terms and activities of these agreements vary from contract to contract and may result in uneven expense levels. Generally, these agreements set forth activities that drive the recording of expenses such as start-up and initiation activities, enrollment and treatment of patients, or the completion of other clinical trial activities. Expenses related to clinical trials are accrued based on estimates and/or representations from service providers regarding work performed, including actual level of patient enrollment, completion of patient studies and progress of the clinical trials. Other incidental costs related to patient enrollment or treatment are accrued when reasonably certain. If the amounts that the Company is obligated to pay under its clinical trial agreements are modified (for instance, because of changes in the clinical trial protocol or scope of work to be performed), the Company adjusts its accruals accordingly on a prospective basis. Revisions to contractual payment obligations are charged to expense in the period in which the facts that give rise to the revision become reasonably certain. Australian Tax Incentive CAPL is eligible to obtain a cash refund from the Australian Taxation Office for eligible R&D expenditures under the Australian R&D Tax Incentive Program (the “Australian Tax Incentive”). The Australian Tax Incentive is recognized as a reduction to R&D expense when there is reasonable assurance that the relevant expenditure has been incurred, the amount can be reliably measured and the Australian Tax Incentive will be received. The Australian Taxation Office has a recapture right for a period of four years. The Company recognized reductions to R&D expense of $ 8,000 and $ 45,000 for the three and nine months ended September 30, 2023 , respectively, and $ 0.3 million and $ 0.7 million for the three and nine months ended September 30, 2022 , respectively. Stock-Based Compensation Stock-based compensation expense represents the estimated grant date fair value of the Company’s equity awards, consisting of stock options, restricted stock units and shares issued under the Company’s Employee Stock Purchase Plan, recognized over the requisite service period of such awards (usually the vesting period) on a straight-line basis. The Company estimates the fair value of all stock option grants using the Black-Scholes option pricing model and recognizes forfeitures as they occur. Restricted stock units are valued using the grant date stock price. For stock awards for which vesting is subject to performance-based milestones, the expense is recorded over the remaining service period after the point when the achievement of the milestone is probable, or the performance condition has been achieved. Comprehensive Loss Comprehensive loss is comprised of the Company’s net loss and the unrealized gains or losses on the Company’s available for sale investment securities for all periods presented. The cumulative amount of unrealized gains and losses is reflected as a separate component of stockholders' equity in the accompanying condensed consolidated balance sheets as accumulated other comprehensive income (loss). Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of common shares outstanding for the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock and dilutive common stock equivalents outstanding for the period determined using the treasury-stock and if-converted methods. Dilutive common stock equivalents are comprised of common stock subject to repurchase and stock options outstanding under the Company’s stock option plan. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding as inclusion of the potentially dilutive securities on loss per share would be antidilutive. Potentially dilutive securities (in common stock equivalent shares) not included in the calculation of diluted net loss per share because to do so would be anti-dilutive are as follows ( in thousands ): As of September 30, 2023 2022 Stock options 12,464 8,899 Restricted stock units 830 278 Employee stock purchase plan 257 159 Total 13,551 9,336 Recently Adopted Accounting Pronouncements ASU 2016-13 In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ” (“Topic 326”). Topic 326 amends guidance on reporting credit losses for assets held at amortized cost basis and available for sale debt securities. For assets held at amortized cost basis, Topic 326 eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. For available for sale debt securities, credit losses should be measured in a manner like current GAAP, however Topic 326 will require that credit losses be presented as an allowance rather than as a write-down. This ASU update affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income (loss). The Company adopted ASU 2016-13 as of January 1, 2023, which did not have a material impact on its condensed consolidated financial statements. |
Investment Securities
Investment Securities | 9 Months Ended |
Sep. 30, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment Securities | 3. INVESTMENT SECURITIES The Company reports its available-for-sale investment securities at t heir estimated fair values. The following is a summary of the available-for-sale investment securities held by the Company as of September 30, 2023 and December 31, 2022 ( in thousands ): As of September 30, 2023 Amortized Gross Gross Fair Available-for-sale investment securities: U.S. government and agency obligations $ 240,061 $ 43 $ ( 363 ) $ 239,741 Certificates of deposit 2,926 — ( 32 ) 2,894 Corporate debt securities 156,157 10 ( 523 ) 155,644 Commercial paper 13,579 — — 13,579 Total $ 412,723 $ 53 $ ( 918 ) $ 411,858 As of December 31, 2022 Amortized Gross Gross Fair Available-for-sale investment securities: U.S. government and agency obligations $ 154,228 $ 12 $ ( 1,510 ) $ 152,730 Certificates of deposit 4,629 — ( 94 ) 4,535 Corporate debt securities 145,330 — ( 2,336 ) 142,994 Asset-backed securities 1,497 — ( 3 ) 1,494 Total $ 305,684 $ 12 $ ( 3,943 ) $ 301,753 As of September 30, 2023 and December 31, 2022, available-for-sale investment securities by contractual maturity were as follows (in thousands): As of September 30, 2023 As of December 31, 2022 Amortized Fair Amortized Fair Available-for-sale investment securities: Due in one year or less $ 292,094 $ 291,253 $ 246,276 $ 243,542 Due after one year through five years 120,629 120,605 59,408 58,211 Total $ 412,723 $ 411,858 $ 305,684 $ 301,753 The following is a summary of the available-for-sale investment securities by length of time in a net loss position as of September 30, 2023 and December 31, 2022 ( in thousands ): As of September 30, 2023 Less Than 12 Months More Than 12 Months Total Fair Gross Fair Gross Fair Gross Available-for-sale investment securities: U.S. government and agency obligations $ 143,242 $ ( 97 ) $ 29,641 $ ( 266 ) $ 172,883 $ ( 363 ) Certificates of deposit 243 ( 2 ) 2,651 ( 30 ) 2,894 ( 32 ) Corporate debt securities 84,291 ( 52 ) 47,072 ( 471 ) 131,363 ( 523 ) Total $ 227,776 $ ( 151 ) $ 79,364 $ ( 767 ) $ 307,140 $ ( 918 ) As of December 31, 2022 Less Than 12 Months More Than 12 Months Total Fair Gross Fair Gross Fair Gross Available-for-sale investment securities: U.S. government and agency obligations $ 95,933 $ ( 702 ) $ 36,681 $ ( 808 ) $ 132,614 $ ( 1,510 ) Certificates of deposit 2,399 ( 47 ) 2,136 ( 47 ) 4,535 ( 94 ) Corporate debt securities 96,663 ( 1,399 ) 43,330 ( 937 ) 139,993 ( 2,336 ) Asset-backed securities 1,494 ( 3 ) — — 1,494 ( 3 ) Total $ 196,489 $ ( 2,151 ) $ 82,147 $ ( 1,792 ) $ 278,636 $ ( 3,943 ) The Company reviewed its investment holdings as of September 30, 2023 and December 31, 2022 and determined that the decline in fair value is attributable to changes in interest rates and not credit quality, and as the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity. Therefore, there were no allowances for credit losses as of September 30, 2023 and December 31, 2022. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 4. FAIR VALUE MEASUREMENTS Investment Securities The Company holds investment securities that consist of highly liquid, investment grade debt securities. The Company determines the fair value of its investment securities based upon one or more valuations reported by its investment accounting and reporting service provider. The investment service provider values the securities using a hierarchical security pricing model that relies primarily on valuations provided by an industry-recognized valuation service. Such valuations may be based on trade prices in active markets for identical assets or liabilities (Level 1 inputs) or valuation models using inputs that are observable either directly or indirectly (Level 2 inputs), such as quoted prices for similar assets or liabilities, yield curves, volatility factors, credit spreads, default rates, loss severity, current market and contractual prices for the underlying instruments or debt, and broker and dealer quotes, as well as other relevant economic measures. Derivative Asset On October 15, 2021, the Company received a warrant (the "Radionetics Warrant") to purchase the greater of 3,407,285 additional shares of common stock or the number of additional shares of common stock that would allow the Company to maintain an aggregate equity interest of 22 % of the fully diluted capitalization of Radionetics. The estimated value of the Radionetics Warrant is based on valuations provided by a third-party valuation specialist using unobservable inputs due to little to no market data (Level 3 inputs). In August 2023, the Company exercised its warrant to purchase 3,407,285 shares of Radionetics common stock with an exercise price of $ 0.00001 per share, and also cancelled its existing right to maintain an aggregate interest of 22 % of the fully diluted capitalization of Radionetics. There were no material changes in the inputs or the total valuation of the Radionetics Warrant in 2023 prior to its exercise and cancellation. Upon exercise, the Radionetics Warrant of $ 0.7 million was derecognized (see "Note 11"). Financial assets measured at fair value on a recurring basis as of September 30, 2023 and December 31, 2022 were as follows ( in thousands ): As of September 30, 2023 Level 1 Level 2 Level 3 Total Investment securities: U.S. government and agency obligations $ 202,813 $ 36,928 $ — $ 239,741 Certificates of deposit — 2,894 — 2,894 Corporate debt securities — 155,644 — 155,644 Commercial paper — 13,579 — 13,579 Total assets measured at fair value $ 202,813 $ 209,045 $ — $ 411,858 As of December 31, 2022 Level 1 Level 2 Level 3 Total Investment securities: U.S. government and agency obligations $ 93,879 $ 58,851 $ — $ 152,730 Certificates of deposit — 4,535 — 4,535 Corporate debt securities — 142,994 — 142,994 Asset-backed securities — 1,494 — 1,494 Total Investment securities 93,879 207,874 — 301,753 Derivative Assets: Radionetics Warrant — — 668 668 Total assets measured at fair value $ 93,879 $ 207,874 $ 668 $ 302,421 The Company’s policy is to recognize transfers between levels of the fair value hierarchy on the date of the event or change in circumstances that caused the transfer. Other than the activity below, there were no transfers into or out of Level 3 during the nine months ended September 30, 2023, or year ended December 31, 2022. The following is the Level 3 activity for the Company’s derivative asset: Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 $ 668 $ 99 $ 668 $ 68 Gain on change in fair value of derivative asset — — — 31 Exercise of derivative asset ( 668 ) — ( 668 ) — Balance at end of period $ — $ 99 $ — $ 99 |
Balance Sheet Details
Balance Sheet Details | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Details | 5. BALANCE SHEET DETAILS Prepaid expenses and other current assets consisted of the follo wing ( in thousands ): September 30, December 31, Prepaid clinical costs $ 3,052 $ 2,567 Prepaid research and development costs 1,606 2,293 Australian tax incentive receivable 962 937 Prepaid insurance 1,289 939 Interest receivable 2,622 1,353 Due from Radionetics 98 135 Landlord improvements receivable 6,178 605 Option exercise receivable 1,779 — Other 3,521 1,930 Total $ 21,107 $ 10,759 Property and equipment, net consisted of the following ( in thousands ): September 30, December 31, Leasehold improvements $ 9,700 $ 3,516 Lab equipment 3,958 3,168 Office equipment 935 859 Computers and software 46 41 Property and equipment at cost 14,639 7,584 Less accumulated depreciation and amortization ( 4,875 ) ( 4,084 ) Total $ 9,764 $ 3,500 Accounts payable and accrued expenses consisted of the following ( in thousands ): September 30, December 31, Accounts payable $ 5,842 $ 6,883 Accrued clinical costs 3,669 1,921 Accrued research and development costs 3,101 4,043 Accrued outside services and professional fees 2,908 1,810 Accrued landlord improvements 5,424 359 Other accrued expenses 991 335 Total $ 21,935 $ 15,351 |
Operating Lease
Operating Lease | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Operating Lease | 6. OPERATING LEASE In February 2018, as amended in March 2018, the Company entered into a non-cancellable operating lease for a facility in San Diego, California (the "2018 Lease"). The 2018 Lease has an initial term of seven years which expires in August 2025 , and the Company has an option to extend the term of the 2018 Lease for an additional five years , a termination option subject to early termination fees and an option to sublease the facility. The 2018 Lease is subject to base lease payments and additional charges for common area maintenance and other costs and includes certain lease incentives and tenant improvement allowances. The Company’s estimated incremental fully collateralized borrowing rate of 8.0 % was used in its present value calculation as the 2018 Lease does not have a stated rate and the implicit rate was not readily determinable. In 2022, the Company entered into a lease agreement for laboratory and office space in San Diego, California (the "2022 Lease"). Under the terms of the 2022 Lease, the Company's expected future monthly minimum lease payments of $ 0.5 million, with six months of rent abatement in the first year, start on the earlier of (i) the date which is ten (10) months after substantial completion of demolition work, or (ii) the date of the substantial completion of improvements and first occupancy for business purposes, and the term expires on the date immediately preceding the one hundred thirty-seventh (137th) monthly anniversary of this lease payment start date. Lease payments are subject to annual 3 % increases. The Company is also responsible for certain operating expenses and taxes during the term of the 2022 Lease. The 2022 Lease provides the Company with specified tenant improvement and landlord work allowances. The Company has (i) two options to extend the term of the 2022 Lease for an additional period of five (5) years each, and (ii) a right of first offer on adjacent space to the new facility, subject to the terms and conditions of the 2022 Lease. As of the date of the recording of the 2022 Lease, the Company is not reasonably certain that these options will be exercised. In September 2023, the Company recorded a right-of-use asset and corresponding lease liability in the accompanying condensed consolidated balance sheets in connection with the 2022 Lease. The Company’s estimated incremental fully collateralized borrowing rate of 8.6 % was used in its present value calculation as the 2022 Lease does not have a stated rate and the implicit rate was not readily determinable. The rate was determined using a synthetic credit rating analysis. Under the terms of the 2018 Lease and 2022 Lease, the Company provided the lessors with irrevocable letters of credit in the amounts of $ 0.5 million and $ 0.8 million, respectively. The lessors are entitled to draw on the letters of credit in the event of any default by the Company under the terms of the leases. As of September 30, 2023, the Company's future minimum payments under non-cancellable operating lease, were as follows (in thousands): Year ending December 31, Minimum 2023 (3 months) $ 689 2024 5,587 2025 7,501 2026 6,829 2027 7,034 Thereafter 56,985 Total future minimum lease payments 84,625 Less imputed interest ( 32,454 ) Total operating lease liability 52,171 Less operating lease liability, current ( 3,989 ) Operating lease liability, non-current $ 48,182 Operating lease cost was $ 0.4 million and $ 0.9 million for the three and nine months ended September 30, 2023, respectively and $ 0.3 million and $ 0.9 million for the three and nine months ended September 30, 2022, respectively. As of September 30, 2023 and December 31, 2022, the Company’s weighted average remaining term was 11.2 and 2.6 years, respectively. As of September 30, 2023 and December 31, 2022 , the Company’s weighted-average discount rate was 8.6 % and 8 %, respectively. Cash paid for amounts included in the measurement of lease liabilities for operating cash flow from operating leases w as $ 0.3 million and $ 0.9 million for the three and nine months ended September 30, 2023 and 2022 , respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 7. COMMITMENTS AND CONTINGENCIES Litigation From time to time, the Company may be subject to various claims and suits arising in the ordinary course of business. The Company does not expect that the resolution of these matters will have a material adverse effect on its financial position or results of operations. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2023 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Revenue Recognition | 8. REVENUE RECOGNITION Sanwa Kagaku Kenkyusho Co., Ltd On February 25, 2022, the Company and Sanwa Kagaku Kenkyusho Co., Ltd. ("Sanwa"), entered into a license agreement (the “Sanwa License”) whereby the Company granted Sanwa an exclusive license to develop and commercialize paltusotine in Japan. Under the Sanwa License, Sanwa has the right to receive data obtained by the Company through certain paltusotine studies. The Company assessed the Sanwa License and concluded that Sanwa is a customer within the agreement. Sanwa will assume all costs associated with clinical trials and regulatory applications associated with these processes in Japan. Further, the Company retains all rights to develop and commercialize the product outside Japan. The Company also granted Sanwa the right to purchase supply of paltusotine for clinical and commercial requirements at cost plus a pre-negotiated percentage which was a market rate and therefore not a material right. The Company determined that its performance obligations under the Sanwa License comprised the license and data exchange. Certain professional services, such as the Company's participation on committees, were deemed to be immaterial to the context of the contract. In exchange, the Company received a $ 13.0 million nonrefundable, upfront payment and will be eligible to receive up to an additional $ 25.5 million in milestone payments related to the achievement of certain development, regulatory and commercial goals. In addition, upon market approval of paltusotine in Japan, the Company will be eligible to receive certain sales-based royalties. The Company determined that the transaction price amounted to the upfront payment of $ 13.0 million. As there have been no sales to date, no sales-based milestones or royalties were recognized to date. Further, using the most-likely-method, the developmental milestone payments were considered fully constrained. The control of the license was transferred to Sanwa at the inception of the contract and the Company does not have an ongoing performance obligation to support or maintain the licensed intellectual property. Revenue allocated to the data exchange obligation is recognized over time using the cost-to-cost measure as this method represents a faithful depiction of progress toward the ongoing paltusotine studies in the U.S. and related data transfer. Revenue is recognized on a gross basis as the Company is the principal. Deferred revenue consisted of the following ( in thousands ): Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 Deferred revenues at beginning of period $ 7,152 $ 9,431 $ 8,341 $ — Unearned revenue from cash received during the period, excluding amounts recognized as revenue during the period — — — 8,972 Revenue recognized that was included in deferred revenues as of the beginning of the period ( 346 ) ( 459 ) ( 1,535 ) — Balance at end of period 6,806 8,972 6,806 8,972 Less deferred revenue, current ( 1,662 ) ( 2,320 ) ( 1,662 ) ( 2,320 ) Deferred revenue, non-current $ 5,144 $ 6,652 $ 5,144 $ 6,652 During the three and nine months ended September 30, 2023 , $ 0.3 million and $ 1.5 million, respectively, of the $ 13.0 million upfront payment was recognized as revenues in the accompanying condensed consolidated statements of operations and comprehensive loss. During the three and nine months ended September 30, 2022 , $ 0.5 million and $ 4.0 million, respectively, of the $ 13.0 million upfront payment was recognized as revenues in the accompanying condensed consolidated statements of operations and comprehensive loss. Of the license revenues recognized during the nine months ended September 30, 2022, $ 1.5 million is related to the transfer of the license at the inception of the Sanwa License at a point in time, with the remaining amounts related to the data exchange performance obligation recognized over time. Deferred revenues are expected to be recognized over the duration of certain paltusotine studies conducted by the Company. On June 14, 2022, the Company and Sanwa, entered into a clinical supply agreement (the "Sanwa Clinical Supply Agreement") whereby the Company is responsible for manufacturing and supplying certain materials to Sanwa for the completion of certain studies and trials under the Sanwa License. During the nine months ended September 30, 2023 , the Company recognized $ 0.4 million of revenues from the Sanwa Clinical Supply Agreement in the accompanying condensed consolidated statements of operations and comprehensive loss. No significant supply purchases made by Sanwa through the Sanwa Clinical Supply Agreement during the three months ended September 30, 2023 or during the three and nine months ended September 30, 2022. Cellular Longevity, Inc., doing business as Loyal On March 24, 2023, the Company and Cellular Longevity Inc., doing business as Loyal ("Loyal") entered into a license agreement (the “Loyal License”) whereby the Company granted Loyal an exclusive license to develop and commercialize CRN01941, a somatostatin receptor type 2 agonist, for veterinary use. In exchange the Company received a $ 0.1 million nonrefundable, upfront payment an d preferred stock in Loyal valued at approximately $ 2.0 million . The Company will also be eligible to receive certain single-digit sales-based royalties if the licensed intellectual property is approved for veterinary use. During the nine months ended September 30, 2023, the Company recognized $ 2.1 million of revenues from the Loyal License at the inception of the contract in the accompanying condensed consolidated statements of operations and comprehensive loss. As of September 30, 2023 , the shares of Loyal preferred stock issued and to be issued to the Company valued at $ 2.0 million is included in other assets in the accompanying condensed consolidated balance sheets. The Loyal preferred stock does not have a readily determinable fair value and is recorded at cost less impairment. The Company assesses equity securities without a readily determinable fair value for changes in observable prices each period, noting none. |
Stockholder's Equity
Stockholder's Equity | 9 Months Ended |
Sep. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | 9. STOCKHOLDERS’ EQUITY Stock Offerings On April 18, 2022, the Company completed an underwritten follow-on offering of 5,625,563 shares of its common stock at a price to the public of $ 22.22 per share. Net proceeds from the offerin g were approximately $ 117.2 million, after underwriting discounts and commissions and estimated offering costs of approximately $ 7.8 million. The shares were registered pursuant to the Company’s 2021 Shelf Registration Statement. On September 15, 2023, the Company completed an underwritten follow-on offering of 11,441,648 shares of its common stock at a price to the public of $ 30.59 per share. Net proceeds from the offering were approximately $ 328.5 million, after underwriting discounts and commissions and offering costs of approximately $ 21.5 million. The shares were registered pursuant to the Company’s 2021 Shelf Registration Statement. Shelf Registration Statements and ATM Offering On August 13, 2019, the Company filed a registration statement on Form S-3 (the “2019 Shelf Registration Statement”), covering the offering of up to $ 300.0 million of common stock, preferred stock, debt securities, warrants and units. The 2019 Shelf Registration Statement became effective on August 29, 2019 and expired on August 29, 2022. On August 13, 2019, the Company also entered into a Sales Agreement (the “Sales Agreement”) with SVB Leerink LLC and Cantor Fitzgerald & Co. (collectively, the “Sales Agents”), under which the Company may, from time to time, sell shares of its common stock through the Sales Agents (the “ATM Offering” ). The 2019 Shelf Registration Statement included a prospectus covering the offering, issuance, and sale of up to $ 75.0 million of the Company’s common stock from time to time through the ATM Offering. On August 10, 2021, the Company filed a registration statement on Form S-3 (the “2021 Shelf Registration Statement”), which became immediately effective upon filing, covering the offering of common stock, preferred stock, debt securities, warrants and units and the resale of up to 851,306 shares by the accredited investor who purchased shares in the Private Placement. On August 12, 2022, the Company filed with the SEC a prospectus supplement, dated August 12, 2022, to the 2021 Shelf Registration Statement pursuant to Rule 424(b) under the Securities Act of 1933, as amended, relating to the offer and sale of up to $ 150 million of shares of its common stock from time to time to or through the Sales Agents, pursuant to the Sales Agreement, in the ATM Offering. Following the expiration of the 2019 Shelf Registration Statement, the shares to be sold under the Sales Agreement may be issued and sold pursuant to the 2021 Shelf Registration Statement. During the nine months ended September 30, 2023, the Company issued 522,807 shares of common stock in the ATM Offering pursuant to the 2021 Shelf Registration Statement for net proceeds of approximately $ 11.3 million, after deducting commissions. |
Equity Incentive Plan
Equity Incentive Plan | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Equity Incentive Plan | 10. EQUITY INCENTIVE PLANS 2021 Employment Inducement Incentive Award Plan The Company adopted the 2021 Employment Inducement Incentive Award Plan (the "2021 Inducement Plan") in December 2021. The Company initially reserved 1,500,000 shares of the Company’s common stock for issuance pursuant to awards granted under the 2021 Inducement Plan. The terms of the 2021 Inducement Plan are substantially similar to the terms of the Company’s 2018 Incentive Award Plan with the exception that awards may only be made to an employee who has not previously been an employee or member of the board of directors of the Company if the award is in connection with commencement of employment. In 2022, the Company amended the 2021 Inducement Plan to increase the number of shares of the Company’s common stock available for future issuance under the 2021 Inducement Plan to 5,000,000 shares. In November 2023, the Company amended the 2021 Inducement Plan to increase the number of shares of the Company’s common stock available for future issuance under the 2021 Inducement Plan to 7,500,000 shares. A s of September 30, 2023 , 589,211 shares of common stock were available for future issuance under the 2021 Inducement Plan. 2018 Incentive Award Plan The Company adopted the 2018 Incentive Award Plan (the “2018 Plan”) in July 2018. Under the 2018 Plan, which expires in July 2028 , the Company may grant equity-based awards to individuals who are employees, officers, directors or con sultants of the Company. Options issued under the 2018 Plan will generally expire ten years from the date of grant and vest over a four-year period. As of September 30, 2023 , 2,549,748 shares of common stock were available for future issuance under the 2018 Plan. The 2018 Plan contains a provision that allows annual increases in the number of shares available for issuance on the first day of each calendar year through January 1, 2028 , in an amount equal to the lesser of: (i) 5 % of the aggregate number of shares of the Company’s common stock outstanding on December 31 of the immediately preceding calendar year, or (ii) such lesser amount determined by the Company. Under this evergreen provision, on January 1, 2023, an additional 2,693,859 shares became available for future issuance under the 2018 Plan. 2015 Stock Incentive Plan The Company adopted the 2015 Stock Incentive Plan (the “2015 Plan”) in February 2015, which provided for the issuance of equity awards to the Company’s employees, members of its board of directors and consultants. In general, options issued under this plan vest over four years and expire after 10 years. Subsequent to the adoption of the 2018 Plan, no additional equity awards can be made under the 2015 Plan. 2018 Employee Stock Purchase Plan The Company adopted the 2018 Employee Stock Purchase Plan (the “ESPP”) in July 2018. The ESPP permits participants to purchase common stock through payroll deductions of up to 20 % of their eligible compensation . As of September 30, 2023, 1,664,012 shares of common stock were available for issuance under the ESPP. The ESPP contains a provision that allows annual increases in the number of shares available for issuance on the first day of each calendar year through January 1, 2028, in an amount equal to the lesser of: (i) 1 % of the aggregate number of shares of the Company’s common stock outstanding on December 31 of the immediately preceding calendar year, or (ii) such lesser amount determined by the Company. Under this evergreen provision, on January 1, 2023, an additional 538,771 shares became available for future issuance under the ESPP. Stock Awards Stock Options Activity under the Company’s stock option plans during the nine months ended September 30, 2023 was as follows: Weighted- Weighted- Aggregate Average Average Intrinsic Options Exercise Remaining Value Outstanding Price Term (000’s) Balance on December 31, 2022 9,757,329 $ 17.79 Granted 4,027,897 $ 19.28 Exercised ( 710,020 ) $ 17.65 Forfeited and expired ( 611,685 ) $ 20.69 Balance on September 30, 2023 12,463,521 $ 18.14 8.0 $ 144,674 Vested and expected to vest on September 30, 2023 12,463,521 $ 18.14 8.0 $ 144,674 Exercisable on September 30, 2023 5,137,282 $ 16.76 6.7 $ 66,733 Aggregate intrinsic value is calculated as the difference at a specific point in time between the closing price of the Company’s common stock and the exercise price of stock options that had exercise prices below the closing price. The aggregate intrinsic value of options exercised during the nine months ended September 30, 2023 and 2022 was $ 6.3 million and $ 5.6 million, respectively. Restricted Stock Units The Company’s restricted stock unit activity during the nine months ended September 30, 2023, was as follows: Weighted- Restricted Stock Average Units Grant Date Outstanding Fair Value Balance on December 31, 2022 290,311 $ 19.88 Granted 666,621 $ 16.62 Vested ( 81,294 ) $ 19.54 Forfeited ( 45,142 ) $ 19.77 Balance on September 30, 2023 830,496 $ 19.71 Fair Value of Stock Awards The Company estimates the fair value of all stock option grants and the ESPP using the Black-Scholes option pricing model and recognizes forfeitures as they occur. The following table summarizes the weighted average assumptions used to estimate the fair value of stock options granted under the Company’s stock option plans for the periods presented below: Stock Option Awards Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 Expected option term 6.1 years 6.0 years 6.0 years 6.0 years Expected volatility 64 % 87 % 66 % 88 % Risk free interest rate 4.3 % 3.3 % 4.1 % 2.4 % Expected dividend yield — % — % — % — % The weighted-average fair value of stock options awarded was $ 11.15 and $ 12.13 per share during the three and nine months ended September 30, 2023 , respectively, and $ 15.12 and $ 15.04 per share during the three and nine months ended September 30, 2022, respectively. The following table summarizes the weighted average assumptions used to estimate the fair value of the ESPP awards for the periods presented below: ESPP Nine months ended September 30, 2023 2022 Expected term 1.1 years 1.2 years Expected volatility 57 % 76 % Risk free interest rate 4.9 % 2.2 % Expected dividend yield — % — % The weighted-average fair value of the ESPP was $ 9.15 per share during the nine months ended September 30, 2023, and $ 8.82 per share during the nine months ended September 30, 2022. There were no ESPP awards during the three months ended September 30, 2023 and 2022. The key assumptions used in determining the fair value of equity awards, and the Company’s rationale, were as follows: (i) Expected term - the expected term for stock options represents the period that the stock options are expected to be outstanding and has been estimated using the simplified method, which is an average of the contractual option term and its vesting period; the expected term for awards granted under the ESPP represents the term the awards are expected to be outstanding; (ii) Expected volatility - during 2022, the expected volatility assumption was based on volatilities of a peer group of similar companies in the biotechnology industry whose share prices are publicly available. The Company computed the historical volatility data using the daily closing prices for the selected companies’ shares during the period equivalent to the expected term of the Company’s stock-based awards. Beginning in 2023, the Company determined that the volatility of its own market-traded shares best represents the expected volatility based on available historical data and, therefore, the expected volatility assumption for stock-based awards granted during the three and nine months ended September 30, 2023 is based on the historical volatility of the Company's common stock; (iii) Risk-free interest rate - the risk-free interest rate is based on the U.S. Treasury yield in effect at the time of grant for zero coupon U.S. Treasury notes with maturities that approximate the expected terms of awards; and (iv) Expected dividend yield - the expected dividend yield assumption is zero as the Company has never paid dividends and has no present intention to do so in the future. Restricted stock units are valued using the grant date stock price. Stock-Based Compensation Expense Stock-based compensation expense for the equity awards issued by the Company to employees and non-employees for the periods presented below was as follows (in thousands): Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 Included in research and development $ 6,088 $ 3,860 $ 16,367 $ 10,732 Included in general and administrative 4,961 3,574 12,953 9,588 Total stock-based compensation expense $ 11,049 $ 7,434 $ 29,320 $ 20,320 As of September 30, 2023 , unrecognized stock-based compensation cost related to option awards, restricted stock units, and ESPP was $ 89.9 million, $ 13.7 million and $ 2.0 million, respectively, which is expected to be recognized over a remaining weighted-average period of 2.1 years, 3.2 years and 1.2 years, respectively. |
Investment in Radionetics
Investment in Radionetics | 9 Months Ended |
Sep. 30, 2023 | |
Schedule of Investments [Abstract] | |
Investment in Radionetics | 11. INVESTMENT IN RADIONETICS Investment in Radionetics In October 2021, the Company entered into a Collaboration and License Agreement with Radionetics, or the Radionetics License, in which the Company granted Radionetics an exclusive worldwide license to its technology for the development of radiotherapeutics and related radio-imaging agents in exchange for 50,500,000 shares of common stock of Radionetics, which represented an initial majority stake in Radionetics of 64 %, and the Radionetics Warrant to purchase the greater of 3,407,285 additional shares of common stock or the number of additional shares of common stock that would allow the Company to maintain an aggregate equity interest of 22 % of the fully diluted capitalization of Radionetics. Radionetics is a VIE due to having insufficient equity to finance its activities without additional subordinated financial support. The Company evaluated whether it is the primary beneficiary of Radionetics by evaluating Radionetics’ key activities: (1) conducting research and development, (2) making financing decisions, and (3) determining the strategic direction of Radionetics. Decisions about research and development activities are made by unanimous vote of members of the research and development committee, in which no individual party has unilateral decision making power. Decisions about financing and strategic direction rest with Radionetics’ board of directors, and no party was determined to be in control, given the Radionetics board of directors was comprised of three members for which each of Crinetics, 5AM and Frazier were entitled to appoint and replace, as needed, their board designee, and a fourth member mutually agreed upon by the other three board members. Radionetics’ management was separate from the Company and was determined by Radionetics’ board of directors. As the Company did not control any of Radionetics' key activities, it was not the primary beneficiary of the VIE and did not consolidate the financial results of Radionetics. The Company accounts for its investment in Radionetics common stock under the equity method of accounting due to its ability to exercise significant influence. The Company records its share of Radionetics income (loss) outside of operations in the statements of operations and comprehensive loss on a quarterly lag. The Company's equity method investment in Radionetics was written down to zero during the first quarter of 2022 as a result of the allocation of the Company’s share of losses of the investee. In August 2023, Radionetics completed a refinancing that included a number of transactions that were negotiated by the Company as a package (the “August 2023 Radionetics Transaction”). In connection with the August 2023 Radionetics Transaction, (1) the Company exercised the Radionetics Warrant to purchase 3,407,285 shares of Radionetics common stock with an exercise price of $ 0.00001 per share, (2) the Company exchanged 32,344,371 shares of Radionetics common stock for Radionetics preferred stock on a one-for-one basis, (3) the Company invested $ 5.0 million to purchase 14,404,656 shares of preferred stock in Radionetics along with other new and existing investors who participated in the financing, and (4) the Company and Radionetics agreed to amend the Radionetics License to include additional sales milestones of up to $ 15 millio n. Radionetics’ convertible notes held by other investors were also converted to Radionetics preferred stock and certain Radionetics common shares held by other investors were cancelled in connection with the financing. The August 2023 Radionetics Transaction was a VIE reconsideration event. The Company determined that Radionetics continues to be a VIE due to having insufficient equity to finance its activities without additional subordinated financial support. The Company also reevaluated whether it is the primary beneficiary of Radionetics and noted there were no changes to Radionetics’ key activities or the conclusion that the Company does not control any of these activities. The size of Radionetics’ board of directors was increased from four to six members. Crinetics, 5AM and Frazier are each entitled to appoint and replace, as needed, their board designee, the fourth member is Radionetics’ CEO, and the fifth and sixth members must be mutually agreed upon by the other four board members. All changes to board composition are subject to shareholder approval with common and preferred shareholders having equal votes. Radionetics’ management continues to be entirely separate from the Company and determined by the Radionetics’ board of directors. As the Company does not control any of Radionetics' key activities, it is not the primary beneficiary and does not consolidate the financial results of Radionetics. Accordingly, the Company continues to account for its investment in Radionetics under the equity method of accounting due to its ability to exercise significant influence. The Company determined that its preferred stock investment in Radionetics represents in-substance common stock. The preferred stock investment is substantially similar to common stock in that it does not have a substantive liquidation preference since the preferred stock will participate in substantially all of Radionetics losses, the conversion ratio for preferred stock into common stock is on a one-for-one basis without any significant restrictions or contingencies, and the preferred stock lacks redemption features, among other factors. The Company is not obligated to fund losses incurred by Radionetics. The Company’s $ 5.0 million purchase of preferred stock in the August 2023 Radionetics Transaction was alongside new and existing investors and did not fund previous losses. In connection with the August 2023 Radionetics Transaction, the Company exercised the Radionetics Warrant, which had a fair value of $ 0.7 million, and purchased $ 5.0 million of preferred stock. These transactions resulted in a $ 5.7 million increase in the Company’s investment in Radionetics. As a result of the August 2023 Radionetics Transaction, the Company experienced net dilution in its ownership of Radionetics from a 55 % ownership stake in Radionetics common stock to a 31 % combined ownership stake in Radionetics common and preferred stock. No gain was recorded upon dilution since cumulative losses that had been suspended exceeded the gain on dilution. During the three months ended September 30, 2023, the Company recorded an equity method loss of $ 1.0 million in the accompanying condensed consolidated statements of operations and comprehensive loss, as a result of the allocation of the Company’s share of Radionetics eligible losses, which is recorded on a quarterly lag. As of September 30, 2023, the Company’s investment in Radionetics of $ 4.7 million is recorded as a long-term asset in the accompanying condensed consolidated balance sheets. The amendment to the Radionetics License in connection with the August 2023 Radionetics Transaction did not result in additional revenue at the time of modification and the sales-based milestone and royalty payments will only be recognized when the milestones or sales occur. Other Items R. Scott Struthers, Ph.D., the Company’s President and Chief Executive Officer, serves as chairman of the Radionetics board of directors. Pursuant to such arrangement, Dr. Struthers received 1,000,000 shares of restricted common stock of Radionetics, which vest ratably over 36 months , subject to continued service, and Dr. Struthers receives a $ 50,000 annual retainer for his service as a board member of Radionetics. As of September 30, 2023 and December 31, 2022, the Company had $ 0.1 million due from Radionetics for reimbursement of certain expenses paid on behalf of Radionetics. These amounts are recorded within prepaid expenses and other current assets in the accompanying condensed consolidated balance sheets. The Company received reimbursements from Radionetics of $ 21,000 and $ 53,000 for the three and nine months ended September 30, 2023, respectively, and $ 0.4 million for the nine months ended September 30, 2022. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Description of Business | Description of Business Crinetics Pharmaceuticals, Inc. (the “Company”) is a clinical-stage pharmaceutical company incorporated in Delaware on November 18, 2008, and based in San Diego, California. The Company is focused on the discovery, development, and commercialization of novel therapeutics for rare endocrine diseases and endocrine-related tumors. In January 2017, the Company established a wholly owned Australian subsidiary, Crinetics Australia Pty Ltd (“CAPL”), in order to conduct various preclinical and clinical activities for its development candidates. |
Unaudited Interim Financial Information | Unaudited Interim Financial Information The accompanying interim condensed consolidated balance sheet as of September 30, 2023, the condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2023 and 2022, the condensed consolidated statements of stockholders’ equity for the three and nine months ended September 30, 2023 and 2022, and the condensed consolidated statements of cash flows for the nine months ended September 30, 2023 and 2022, and the related disclosures are unaudited. In management’s opinion, the unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of September 30, 2023 and the results of its operations and cash flows for the nine months ended September 30, 2023 and 2022 in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The results for the three and nine months ended September 30, 2023 are not necessarily indicative of the results expected for the full fiscal year or any other interim period. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2022, included in our Annual Report on Form 10-K filed with the SEC on February 28, 2023. The condensed consolidated balance sheet as of December 31, 2022, has been derived from the audited consolidated financial statements as of that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. |
Principles of Consolidation and Foreign Currency Transactions | Principles of Consolidation and Foreign Currency Transactions The condensed consolidated financial statements include the accounts of the Company and CAPL. All intercompany accounts and transactions have been eliminated in consolidation. The functional currency of both the Company and CAPL is the U.S. dollar. Assets and liabilities that are not denominated in the functional currency are remeasured into U.S. dollars at foreign currency exchange rates in effect at the balance sheet date except for nonmonetary assets, which are remeasured at historical foreign currency exchange rates in effect at the date of transaction. Net realized and unrealized gains and losses from foreign currency transactions and remeasurement are reported in other income (expense), in the condensed consolidated statements of operations and were not material for all periods presented. |
Segment Reporting | Segment Reporting Operating segments are identified as components of an enterprise about which discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business in one operating segment. |
Liquidity | Liquidity From inception, the Company has devoted substantially all of its efforts to drug discovery and development, and conducting preclinical studies and clinical trials. The Company has a limited operating history, and the sales and income potential of the Company’s business and market are unproven. Successful transition to attaining profitable operations is dependent upon achieving a level of revenues adequate to support the Company’s cost structure. The Company has experienced net losses and negative cash flows from operating activities since its inception and has an accumulated deficit o f $ 593.6 m illion as of September 30, 2023. As of September 30, 2023, the Com pany had $ 554.7 million i n unrestricted cash, cash equivalents and investment securities, which the Company believes is sufficient to meet its funding requirements for at least the next 12 months. The Company expects to continue to incur net losses for the foreseeable future and believes it will need to raise substantial additional capital to accomplish its business plan over the next several years. The Company plans to continue to fund its losses from operations and capital funding needs through a combination of equity offerings, debt financings or other sources, including potential collaborations, licenses, and other similar arrangements. If the Company is not able to secure adequate additional funding, the Company may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, or suspend or curtail planned programs. Any of these actions could materially harm the Company’s business, results of operations and prospects. There can be no assurance as to the availability or terms upon which such financing and capital might be available in the future. |
Use of Estimates | Use of Estimates The Company’s condensed consolidated financial statements are prepared in accordance with GAAP. The preparation of the Company’s condensed consolidated financial statements requires it to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in the Company’s condensed consolidated financial statements and accompanying notes. The most significant estimates in the Company’s condensed consolidated financial statements relate to accrual of research and development expenses, valuation of stock-based awards, fair values of financial instruments, revenue recognition, investment in Radionetics, and the assumptions underlying the determination of the estimated incremental borrowing rate for the determination of the Company’s operating lease right-of-use assets. Estimates are based on historical experiences or on forecasts, including information received from third parties and various other factors that the Company believes are reasonable under the circumstances. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Actual results could differ from those estimates. |
Investment in Radionetics | Investment in Radionetics In October 2021, the Company, together with 5AM Ventures ("5AM") and Frazier Healthcare Partners ("Frazier"), announced the formation of Radionetics Oncology, Inc. ("Radionetics"). The Company first analyzes its investment in another entity to determine if the entity is a variable interest entity (“VIE”) and if so, whether the Company is the primary beneficiary requiring consolidation. An entity is considered a VIE if (1) the entity does not have enough equity to finance its own activities without additional support, (2) the entity’s at-risk equity holders lack the characteristics of a controlling financial interest, or (3) the entity is structured with non-substantive voting rights. VIEs are consolidated by the primary beneficiary, which is the entity that has both the power to direct the activities that most significantly impact the VIE’s economic performance and the obligation to absorb losses or the right to receive benefits from the VIE that potentially could be significant to the VIE. Variable interests in a VIE can be contractual, ownership, or other financial interests. The Company re-assesses its investment upon reconsideration events to determine whether the Company is the primary beneficiary of the VIE, in which case the Company would consolidate the VIE. If it has been determined that the Company is not the primary beneficiary but does have the ability to exercise significant influence over the VIE, the Company accounts for the unconsolidated investment under the equity method of accounting. |
Fair Value Measurements | Fair Value Measurements The accounting guidance defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or non-recurring basis. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Observable inputs such as quoted prices in active markets. Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions about risk and the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The carrying amounts of the Company’s current financial assets, restricted cash and current financial liabilities are considered to be representative of their respective fair values because of the short-term nature of those instruments. The Company recorded the derivative asset (see Note 11 ) and investment securities (see Note 4) at fair value. |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents include cash held in readily available checking and money market accounts, as well as short-term debt securities with maturities of three months or less when purchased. Restricted cash represents cash held as collateral for the Company’s facility leases and is reported as a long-term asset in the accompanying condensed consolidated balance sheets. Cash and cash equivalents are considered Level 1 investments. |
Investment Securities | Investment Securities All investments have been classified as “available-for-sale” and are carried at fair value as determined based upon quoted market prices or pricing models for similar securities at period end. Investments with contractual maturities less than 12 months at the balance sheet date are considered short-term investments. Investments with contractual maturities beyond one year are also classified as short-term due to the Company’s ability to liquidate the investment for use in operations within the next 12 months. Realized gains and losses on investment securities are derived using the specific identification method for determining the cost of securities sold and are included in other income (expenses), net in the accompanying condensed consolidated statements of operations and comprehensive loss. The Company has not realized any significant gains or losses on sales of available-for-sale debt securities during any of the periods presented. Interest income is recognized when earned and is included in interest income in the accompanying condensed consolidated statements of operations and comprehensive loss, as are the amortization of purchase premiums and accretion of purchase discounts on investment securities. Effective January 1, 2023, at each balance sheet date, the Company assesses available-for-sale debt securities in an unrealized loss position to determine whether the unrealized loss or any potential credit losses should be recognized in net loss. For available-for-sale debt securities in an unrealized loss position, the Company first assesses whether it intends to sell, or it is more likely than not that it will be required to sell, the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through net loss. For available-for-sale securities that do not meet the criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, the Company considers the severity of the impairment, any changes in interest rates, underlying credit ratings, and forecasted recovery, among other factors. The credit-related portion of unrealized losses, and any subsequent improvements, are recorded as an allowance in interest income. There have been no impairment or credit losses recognized during the periods presented in the accompanying condensed consolidated statements of operations and comprehensive loss. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents and investment securities. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash balances due to the financial position of the depository institution in which those deposits are held. Additionally, the Company has established guidelines regarding approved investments and maturities of investments, which are designed to maintain safety and liquidity. |
Leases | Leases The Company determines if an arrangement is a lease at the inception of the arrangement. Leases with a term longer than 12 months that are determined to be operating leases are included in operating lease right-of-use assets, operating lease liabilities and noncurrent operating lease liabilities in the condensed consolidated balance sheets at the accounting commencement date of the arrangement. The Company accounts for each separate lease and non-lease component as a single lease component. When the Company’s leases do not provide an implicit rate, an incremental borrowing rate is used based on the information available at accounting commencement dates in determining the present value of lease payments. The incremental borrowing rate is the rate of interest that the Company would expect to pay to borrow over a similar term, and on a collateralized basis, an amount equal to the lease payments in a similar economic environment. The Company’s lease terms may include options to extend or terminate the lease when the Company is reasonably certain that it will exercise such options. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Lease agreements may contain variable costs such as common area maintenance, insurance, taxes, or other costs. Such variable lease costs are expensed as incurred. The Company assesses its leases to determine whether the arrangements contain lease incentives. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment consist of leasehold improvements, and lab and various other equipment. Such assets are stated at cost and depreciated on a straight-line basis over the estimated useful life of the related assets. The Company estimates its useful lives of its lab and other equipment as follows: lab equipment – three to five years; office equipment - three to five years; computer and software – three years. Leasehold improvements are amortized over the estimated useful life of the improvement or the remaining term of the associated lease. Repairs and maintenance costs are charged to expense as incurred and expenditures that materially extend the useful lives of assets are capitalized. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets (or asset group) may not be fully recoverable. Factors considered in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends, and significant changes or planned changes in the use of the assets. An impairment loss is recognized when estimated undiscounted future cash flows expected to result from the use of an asset (or asset group) are less than its carrying amount. If such assets are considered impaired, the impairment loss recognized is measured as the excess of the carrying value of the impaired asset over its fair value, determined based on future cash flows or appraised values, depending on the nature of the asset (or asset group). The Company has not recognized any impairment losses in any of the periods presented in these consolidated financial statements. |
Revenue Recognition | Revenue Recognition The Company has generated revenue from licensing arrangements and supply agreements. The Company recognizes revenues when, or as, the promised goods or services are transferred to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those services. To determine revenue recognition for arrangements, the Company performs the following five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligation(s) in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligation(s) in the contract; and (5) recognize revenue when (or as) the performance obligation(s) are satisfied. At contract inception, the Company assesses the goods or services promised within each contract, assesses whether each promised good or service is distinct and identifies those that are performance obligations. The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when, or as, the performance obligation is satisfied. The Company has entered into licensing and collaboration agreements that mainly include the following: (i) upfront considerations; (ii) payments associated with achieving certain milestones; and (iii) royalties based on specified percentages of net product sales, if any. The Company has also entered into a manufacturing and supply arrangement that includes reimbursements of costs plus a pre-determined margin. At the initiation of an agreement, the Company analyzes each unit of account within the contract to determine if the counterparty is a customer in the context of the unit of account. The Company considers a variety of factors in determining the appropriate estimates and assumptions under the arrangements, such as whether the elements are distinct performance obligations, whether there are observable standalone prices, whether the license is functional or symbolic, and whether the Company is acting as the agent or principal. The Company evaluates each performance obligation to determine if it can be satisfied and recognized as revenue at a point in time or over time. At the inception of arrangements that include variable consideration, the Company uses judgment to estimate the amount of variable consideration to include in the transaction price using the most likely method. If it is probable that a significant revenue reversal will not occur, then the estimated amount is included in the transaction price. Milestone payments that are not within the Company's or the licensee’s control, such as regulatory approvals, are not included in the transaction price until those approvals are received. At the end of each reporting period, the Company re-evaluates the estimated variable consideration included in the transaction price and any related constraint and, as necessary, adjusts the estimate of the overall transaction price. Any adjustments will be recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. The Company develops estimates of the standalone selling price for each distinct performance obligation. Variable consideration that relates specifically to efforts to satisfy specific performance obligations is allocated entirely to those performance obligations. Other components of the transaction price are allocated based on the relative standalone selling price, over which management has applied significant judgment. The Company determines the standalone selling price for license-related performance obligations using a market approach, which may include assumptions such as forecasted revenues, development timelines, discount rates and probabilities of success. The Company estimates the standalone selling price for the data exchange performance obligation (see Note 8) by forecasting the expected costs of satisfying a performance obligation plus a predetermined margin. In the case of a license that is a distinct performance obligation, the Company recognizes revenue allocated to the license from non-refundable, up-front fees at the point in time when the license is transferred to the licensee and the licensee can use and benefit from the license. For licenses that are bundled with other distinct or combined obligations, the Company uses judgment to assess the nature of the performance obligation to determine whether the performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. If the performance obligation is satisfied over time, then the Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The selection of the method to measure progress towards completion requires judgment and is based on the nature of the products or services to be provided. The Company has used the cost-to-cost measure of progress because it best depicts the transfer of control to the customer which occurs as the Company incurs costs. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation, which is considered an input method. The Company uses judgment to estimate the total cost of these performance obligations, which include subcontractors' costs, labor, materials, other direct costs, and an allocation of indirect costs. The Company evaluates these cost estimates and the progress each reporting period and, as necessary, the Company adjusts the measure of progress and related revenue recognition. Sales-based milestones and royalties are recognized at the later of when the subsequent sale or usage occurs or the performance obligation for which some or all of the sales-based milestones and royalties have been allocated to has been satisfied or partially satisfied. |
Research and Development Expenses | Research and Development Expenses Research and development (“R&D”) expenses consist primarily of salaries, payroll taxes, employee benefits and stock-based compensation for individuals involved in R&D efforts, as well as consulting expenses, third-party R&D expenses, laboratory supplies, clinical materials and overhead, including facilities and depreciation costs, offset by the Australian Tax Incentive discussed below. R&D expenses are charged to expense as incurred. Payments made prior to the receipt of goods or services to be used in R&D are capitalized until the goods or services are received and are recorded as prepaid expenses and other current assets. Costs incurred under contracts with contract research organizations that conduct and manage the Company’s clinical trials are also included in R&D expenses. The financial terms and activities of these agreements vary from contract to contract and may result in uneven expense levels. Generally, these agreements set forth activities that drive the recording of expenses such as start-up and initiation activities, enrollment and treatment of patients, or the completion of other clinical trial activities. Expenses related to clinical trials are accrued based on estimates and/or representations from service providers regarding work performed, including actual level of patient enrollment, completion of patient studies and progress of the clinical trials. Other incidental costs related to patient enrollment or treatment are accrued when reasonably certain. If the amounts that the Company is obligated to pay under its clinical trial agreements are modified (for instance, because of changes in the clinical trial protocol or scope of work to be performed), the Company adjusts its accruals accordingly on a prospective basis. Revisions to contractual payment obligations are charged to expense in the period in which the facts that give rise to the revision become reasonably certain. |
Australian Tax Incentive | Australian Tax Incentive CAPL is eligible to obtain a cash refund from the Australian Taxation Office for eligible R&D expenditures under the Australian R&D Tax Incentive Program (the “Australian Tax Incentive”). The Australian Tax Incentive is recognized as a reduction to R&D expense when there is reasonable assurance that the relevant expenditure has been incurred, the amount can be reliably measured and the Australian Tax Incentive will be received. The Australian Taxation Office has a recapture right for a period of four years. The Company recognized reductions to R&D expense of $ 8,000 and $ 45,000 for the three and nine months ended September 30, 2023 , respectively, and $ 0.3 million and $ 0.7 million for the three and nine months ended September 30, 2022 , respectively. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense represents the estimated grant date fair value of the Company’s equity awards, consisting of stock options, restricted stock units and shares issued under the Company’s Employee Stock Purchase Plan, recognized over the requisite service period of such awards (usually the vesting period) on a straight-line basis. The Company estimates the fair value of all stock option grants using the Black-Scholes option pricing model and recognizes forfeitures as they occur. Restricted stock units are valued using the grant date stock price. For stock awards for which vesting is subject to performance-based milestones, the expense is recorded over the remaining service period after the point when the achievement of the milestone is probable, or the performance condition has been achieved. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is comprised of the Company’s net loss and the unrealized gains or losses on the Company’s available for sale investment securities for all periods presented. The cumulative amount of unrealized gains and losses is reflected as a separate component of stockholders' equity in the accompanying condensed consolidated balance sheets as accumulated other comprehensive income (loss). |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of common shares outstanding for the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock and dilutive common stock equivalents outstanding for the period determined using the treasury-stock and if-converted methods. Dilutive common stock equivalents are comprised of common stock subject to repurchase and stock options outstanding under the Company’s stock option plan. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding as inclusion of the potentially dilutive securities on loss per share would be antidilutive. Potentially dilutive securities (in common stock equivalent shares) not included in the calculation of diluted net loss per share because to do so would be anti-dilutive are as follows ( in thousands ): As of September 30, 2023 2022 Stock options 12,464 8,899 Restricted stock units 830 278 Employee stock purchase plan 257 159 Total 13,551 9,336 |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements ASU 2016-13 In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ” (“Topic 326”). Topic 326 amends guidance on reporting credit losses for assets held at amortized cost basis and available for sale debt securities. For assets held at amortized cost basis, Topic 326 eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. For available for sale debt securities, credit losses should be measured in a manner like current GAAP, however Topic 326 will require that credit losses be presented as an allowance rather than as a write-down. This ASU update affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income (loss). The Company adopted ASU 2016-13 as of January 1, 2023, which did not have a material impact on its condensed consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Table) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Potentially Dilutive Securities not Included in Calculation of Diluted Net Loss Per Share | Potentially dilutive securities (in common stock equivalent shares) not included in the calculation of diluted net loss per share because to do so would be anti-dilutive are as follows ( in thousands ): As of September 30, 2023 2022 Stock options 12,464 8,899 Restricted stock units 830 278 Employee stock purchase plan 257 159 Total 13,551 9,336 |
Investment Securities (Tables)
Investment Securities (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Available-For-Sale Investment Securities Held by the Company | The Company reports its available-for-sale investment securities at t heir estimated fair values. The following is a summary of the available-for-sale investment securities held by the Company as of September 30, 2023 and December 31, 2022 ( in thousands ): As of September 30, 2023 Amortized Gross Gross Fair Available-for-sale investment securities: U.S. government and agency obligations $ 240,061 $ 43 $ ( 363 ) $ 239,741 Certificates of deposit 2,926 — ( 32 ) 2,894 Corporate debt securities 156,157 10 ( 523 ) 155,644 Commercial paper 13,579 — — 13,579 Total $ 412,723 $ 53 $ ( 918 ) $ 411,858 As of December 31, 2022 Amortized Gross Gross Fair Available-for-sale investment securities: U.S. government and agency obligations $ 154,228 $ 12 $ ( 1,510 ) $ 152,730 Certificates of deposit 4,629 — ( 94 ) 4,535 Corporate debt securities 145,330 — ( 2,336 ) 142,994 Asset-backed securities 1,497 — ( 3 ) 1,494 Total $ 305,684 $ 12 $ ( 3,943 ) $ 301,753 |
Summary of Available-For-Sale Investment Securities By Contractual Maturity | As of September 30, 2023 and December 31, 2022, available-for-sale investment securities by contractual maturity were as follows (in thousands): As of September 30, 2023 As of December 31, 2022 Amortized Fair Amortized Fair Available-for-sale investment securities: Due in one year or less $ 292,094 $ 291,253 $ 246,276 $ 243,542 Due after one year through five years 120,629 120,605 59,408 58,211 Total $ 412,723 $ 411,858 $ 305,684 $ 301,753 |
Summary of Available-For-Sale Securities Investment | The following is a summary of the available-for-sale investment securities by length of time in a net loss position as of September 30, 2023 and December 31, 2022 ( in thousands ): As of September 30, 2023 Less Than 12 Months More Than 12 Months Total Fair Gross Fair Gross Fair Gross Available-for-sale investment securities: U.S. government and agency obligations $ 143,242 $ ( 97 ) $ 29,641 $ ( 266 ) $ 172,883 $ ( 363 ) Certificates of deposit 243 ( 2 ) 2,651 ( 30 ) 2,894 ( 32 ) Corporate debt securities 84,291 ( 52 ) 47,072 ( 471 ) 131,363 ( 523 ) Total $ 227,776 $ ( 151 ) $ 79,364 $ ( 767 ) $ 307,140 $ ( 918 ) As of December 31, 2022 Less Than 12 Months More Than 12 Months Total Fair Gross Fair Gross Fair Gross Available-for-sale investment securities: U.S. government and agency obligations $ 95,933 $ ( 702 ) $ 36,681 $ ( 808 ) $ 132,614 $ ( 1,510 ) Certificates of deposit 2,399 ( 47 ) 2,136 ( 47 ) 4,535 ( 94 ) Corporate debt securities 96,663 ( 1,399 ) 43,330 ( 937 ) 139,993 ( 2,336 ) Asset-backed securities 1,494 ( 3 ) — — 1,494 ( 3 ) Total $ 196,489 $ ( 2,151 ) $ 82,147 $ ( 1,792 ) $ 278,636 $ ( 3,943 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets Measured at Fair Value on Recurring Basis | Financial assets measured at fair value on a recurring basis as of September 30, 2023 and December 31, 2022 were as follows ( in thousands ): As of September 30, 2023 Level 1 Level 2 Level 3 Total Investment securities: U.S. government and agency obligations $ 202,813 $ 36,928 $ — $ 239,741 Certificates of deposit — 2,894 — 2,894 Corporate debt securities — 155,644 — 155,644 Commercial paper — 13,579 — 13,579 Total assets measured at fair value $ 202,813 $ 209,045 $ — $ 411,858 As of December 31, 2022 Level 1 Level 2 Level 3 Total Investment securities: U.S. government and agency obligations $ 93,879 $ 58,851 $ — $ 152,730 Certificates of deposit — 4,535 — 4,535 Corporate debt securities — 142,994 — 142,994 Asset-backed securities — 1,494 — 1,494 Total Investment securities 93,879 207,874 — 301,753 Derivative Assets: Radionetics Warrant — — 668 668 Total assets measured at fair value $ 93,879 $ 207,874 $ 668 $ 302,421 |
Schedule of Level 3 derivative asset Fair Value | The following is the Level 3 activity for the Company’s derivative asset: Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 $ 668 $ 99 $ 668 $ 68 Gain on change in fair value of derivative asset — — — 31 Exercise of derivative asset ( 668 ) — ( 668 ) — Balance at end of period $ — $ 99 $ — $ 99 |
Balance Sheet Details (Tables)
Balance Sheet Details (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Components of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the follo wing ( in thousands ): September 30, December 31, Prepaid clinical costs $ 3,052 $ 2,567 Prepaid research and development costs 1,606 2,293 Australian tax incentive receivable 962 937 Prepaid insurance 1,289 939 Interest receivable 2,622 1,353 Due from Radionetics 98 135 Landlord improvements receivable 6,178 605 Option exercise receivable 1,779 — Other 3,521 1,930 Total $ 21,107 $ 10,759 |
Components of Property and Equipment, Net | Property and equipment, net consisted of the following ( in thousands ): September 30, December 31, Leasehold improvements $ 9,700 $ 3,516 Lab equipment 3,958 3,168 Office equipment 935 859 Computers and software 46 41 Property and equipment at cost 14,639 7,584 Less accumulated depreciation and amortization ( 4,875 ) ( 4,084 ) Total $ 9,764 $ 3,500 |
Schedule of Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses consisted of the following ( in thousands ): September 30, December 31, Accounts payable $ 5,842 $ 6,883 Accrued clinical costs 3,669 1,921 Accrued research and development costs 3,101 4,043 Accrued outside services and professional fees 2,908 1,810 Accrued landlord improvements 5,424 359 Other accrued expenses 991 335 Total $ 21,935 $ 15,351 |
Operating Lease (Tables)
Operating Lease (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Schedule of Future Minimum Payments Under Non-cancellable Operating Leases | As of September 30, 2023, the Company's future minimum payments under non-cancellable operating lease, were as follows (in thousands): Year ending December 31, Minimum 2023 (3 months) $ 689 2024 5,587 2025 7,501 2026 6,829 2027 7,034 Thereafter 56,985 Total future minimum lease payments 84,625 Less imputed interest ( 32,454 ) Total operating lease liability 52,171 Less operating lease liability, current ( 3,989 ) Operating lease liability, non-current $ 48,182 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Schedule of Deferred Revenue Components | Deferred revenue consisted of the following ( in thousands ): Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 Deferred revenues at beginning of period $ 7,152 $ 9,431 $ 8,341 $ — Unearned revenue from cash received during the period, excluding amounts recognized as revenue during the period — — — 8,972 Revenue recognized that was included in deferred revenues as of the beginning of the period ( 346 ) ( 459 ) ( 1,535 ) — Balance at end of period 6,806 8,972 6,806 8,972 Less deferred revenue, current ( 1,662 ) ( 2,320 ) ( 1,662 ) ( 2,320 ) Deferred revenue, non-current $ 5,144 $ 6,652 $ 5,144 $ 6,652 |
Equity Incentive Plan (Tables)
Equity Incentive Plan (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | |
Summary of Company's stock option activity | Activity under the Company’s stock option plans during the nine months ended September 30, 2023 was as follows: Weighted- Weighted- Aggregate Average Average Intrinsic Options Exercise Remaining Value Outstanding Price Term (000’s) Balance on December 31, 2022 9,757,329 $ 17.79 Granted 4,027,897 $ 19.28 Exercised ( 710,020 ) $ 17.65 Forfeited and expired ( 611,685 ) $ 20.69 Balance on September 30, 2023 12,463,521 $ 18.14 8.0 $ 144,674 Vested and expected to vest on September 30, 2023 12,463,521 $ 18.14 8.0 $ 144,674 Exercisable on September 30, 2023 5,137,282 $ 16.76 6.7 $ 66,733 |
Summary of Company's restricted stock unit activity | The Company’s restricted stock unit activity during the nine months ended September 30, 2023, was as follows: Weighted- Restricted Stock Average Units Grant Date Outstanding Fair Value Balance on December 31, 2022 290,311 $ 19.88 Granted 666,621 $ 16.62 Vested ( 81,294 ) $ 19.54 Forfeited ( 45,142 ) $ 19.77 Balance on September 30, 2023 830,496 $ 19.71 |
Weighted Average Assumptions Used to Estimate Fair Value of Stock Awards Granted to Employees | The following table summarizes the weighted average assumptions used to estimate the fair value of stock options granted under the Company’s stock option plans for the periods presented below: Stock Option Awards Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 Expected option term 6.1 years 6.0 years 6.0 years 6.0 years Expected volatility 64 % 87 % 66 % 88 % Risk free interest rate 4.3 % 3.3 % 4.1 % 2.4 % Expected dividend yield — % — % — % — % |
Summary of Stock-based Compensation Expense for the Equity Awards Issued to Employees and Non-Employees | Stock-based compensation expense for the equity awards issued by the Company to employees and non-employees for the periods presented below was as follows (in thousands): Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 Included in research and development $ 6,088 $ 3,860 $ 16,367 $ 10,732 Included in general and administrative 4,961 3,574 12,953 9,588 Total stock-based compensation expense $ 11,049 $ 7,434 $ 29,320 $ 20,320 |
Employee Stock Purchase Plan | |
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | |
Weighted Average Assumptions Used to Estimate Fair Value of Stock Awards Granted to Employees | The following table summarizes the weighted average assumptions used to estimate the fair value of the ESPP awards for the periods presented below: ESPP Nine months ended September 30, 2023 2022 Expected term 1.1 years 1.2 years Expected volatility 57 % 76 % Risk free interest rate 4.9 % 2.2 % Expected dividend yield — % — % |
Organization and Basis of Pre_2
Organization and Basis of Presentation - Additional Information (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 USD ($) Segment | Dec. 31, 2022 USD ($) | |
Organization And Basis Of Presentation [Line Items] | ||
Number of operating segments | Segment | 1 | |
Accumulated deficit | $ 593,605 | $ 439,173 |
Unrestricted cash, cash equivalents and investments securities | $ 554,700 | |
Minimum | ||
Organization And Basis Of Presentation [Line Items] | ||
Period of sufficient cash to meet its funding requirements | 12 months |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Australian Research and Development Tax Incentive | Australian Taxation Office | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Tax incentive receivable, reductions to research and development expense | $ 8,000 | $ 300 | $ 45,000 | $ 700 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Potentially Dilutive Securities not Included in Calculation of Diluted Net Loss Per Share (Details) - shares shares in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from calculation of diluted net loss per share | 13,551 | 9,336 |
Employee stock purchase plan | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from calculation of diluted net loss per share | 257 | 159 |
Restricted Stock Units | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from calculation of diluted net loss per share | 830 | 278 |
Stock Options | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from calculation of diluted net loss per share | 12,464 | 8,899 |
Investment Securities - Summary
Investment Securities - Summary of Available-For-Sale Investment Securities Held by the Company (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale investment securities, Amortized Cost | $ 412,723 | $ 305,684 |
Available-for-sale investment securities, Gross Unrealized Gains | 53 | 12 |
Available-for-sale investment securities, Gross Unrealized Losses | (918) | (3,943) |
Available-for-sale investment securities, Fair Market Value | 411,858 | 301,753 |
U.S. Government and Agency Obligations [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale investment securities, Amortized Cost | 240,061 | 154,228 |
Available-for-sale investment securities, Gross Unrealized Gains | 43 | 12 |
Available-for-sale investment securities, Gross Unrealized Losses | (363) | (1,510) |
Available-for-sale investment securities, Fair Market Value | 239,741 | 152,730 |
Certificates of Deposit [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale investment securities, Amortized Cost | 2,926 | 4,629 |
Available-for-sale investment securities, Gross Unrealized Gains | 0 | 0 |
Available-for-sale investment securities, Gross Unrealized Losses | (32) | (94) |
Available-for-sale investment securities, Fair Market Value | 2,894 | 4,535 |
Corporate Debt Securities [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale investment securities, Amortized Cost | 156,157 | 145,330 |
Available-for-sale investment securities, Gross Unrealized Gains | 10 | 0 |
Available-for-sale investment securities, Gross Unrealized Losses | (523) | (2,336) |
Available-for-sale investment securities, Fair Market Value | 155,644 | 142,994 |
Commercial Paper [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale investment securities, Amortized Cost | 13,579 | |
Available-for-sale investment securities, Gross Unrealized Gains | 0 | |
Available-for-sale investment securities, Gross Unrealized Losses | 0 | |
Available-for-sale investment securities, Fair Market Value | $ 13,579 | |
Asset-backed securities [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale investment securities, Amortized Cost | 1,497 | |
Available-for-sale investment securities, Gross Unrealized Gains | 0 | |
Available-for-sale investment securities, Gross Unrealized Losses | (3) | |
Available-for-sale investment securities, Fair Market Value | $ 1,494 |
Investment Securities - Summa_2
Investment Securities - Summary of Available-For-Sale Investment Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Securities, Available-for-Sale, Maturity, Allocated and Single Maturity Date, Fair Value [Abstract] | ||
Available-for-sale investment securities, Amortized Cost, Due in one year or less | $ 292,094 | $ 246,276 |
Available-for-sale investment securities, Amortized Cost, Due after one year through five years | 120,629 | 59,408 |
Debt Securities, Available-for-sale, Maturity, Allocated and Single Maturity Date, Amortized Cost, Total | 412,723 | 305,684 |
Available-for-sale investment securities, Fair market Value, Due in one year or less | 291,253 | 243,542 |
Available-for-sale investment securities, Fair market Value, Due after one year through five years | 120,605 | 58,211 |
Debt Securities, Available-for-sale, Maturity, Allocated and Single Maturity Date, Fair Value, Total | $ 411,858 | $ 301,753 |
Investment Securities - Summa_3
Investment Securities - Summary of Available-For-Sale Securities Investment (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Available-for-sale investment securities: | ||
Available-for-sale Investment Securities, Less than 12 Months, Fair Market Value | $ 227,776 | $ 196,489 |
Available-for-sale Investment Securities, More Than 12 Months, Fair Value | 79,364 | 82,147 |
Available-for-sale investment securities, Fair Market Value | 307,140 | 278,636 |
Available-for-sale Investment Securities, Gross Unrealized Loss, Less than 12 Months | (151) | (2,151) |
Available-for-sale Investment Securities, Gross Unrealized Loss, More Than 12 Months | (767) | (1,792) |
Available-for-sale Investment Securities, Gross Unrealized Losses | (918) | (3,943) |
U.S. Government and Agency Obligations [Member] | ||
Available-for-sale investment securities: | ||
Available-for-sale Investment Securities, Less than 12 Months, Fair Market Value | 143,242 | 95,933 |
Available-for-sale Investment Securities, More Than 12 Months, Fair Value | 29,641 | 36,681 |
Available-for-sale investment securities, Fair Market Value | 172,883 | 132,614 |
Available-for-sale Investment Securities, Gross Unrealized Loss, Less than 12 Months | (97) | (702) |
Available-for-sale Investment Securities, Gross Unrealized Loss, More Than 12 Months | (266) | (808) |
Available-for-sale Investment Securities, Gross Unrealized Losses | (363) | (1,510) |
Certificates of Deposit [Member] | ||
Available-for-sale investment securities: | ||
Available-for-sale Investment Securities, Less than 12 Months, Fair Market Value | 243 | 2,399 |
Available-for-sale Investment Securities, More Than 12 Months, Fair Value | 2,651 | 2,136 |
Available-for-sale investment securities, Fair Market Value | 2,894 | 4,535 |
Available-for-sale Investment Securities, Gross Unrealized Loss, Less than 12 Months | (2) | (47) |
Available-for-sale Investment Securities, Gross Unrealized Loss, More Than 12 Months | (30) | (47) |
Available-for-sale Investment Securities, Gross Unrealized Losses | (32) | (94) |
Corporate Debt Securities [Member] | ||
Available-for-sale investment securities: | ||
Available-for-sale Investment Securities, Less than 12 Months, Fair Market Value | 84,291 | 96,663 |
Available-for-sale Investment Securities, More Than 12 Months, Fair Value | 47,072 | 43,330 |
Available-for-sale investment securities, Fair Market Value | 131,363 | 139,993 |
Available-for-sale Investment Securities, Gross Unrealized Loss, Less than 12 Months | (52) | (1,399) |
Available-for-sale Investment Securities, Gross Unrealized Loss, More Than 12 Months | (471) | (937) |
Available-for-sale Investment Securities, Gross Unrealized Losses | $ (523) | (2,336) |
Asset-backed securities [Member] | ||
Available-for-sale investment securities: | ||
Available-for-sale Investment Securities, Less than 12 Months, Fair Market Value | 1,494 | |
Available-for-sale Investment Securities, More Than 12 Months, Fair Value | 0 | |
Available-for-sale investment securities, Fair Market Value | 1,494 | |
Available-for-sale Investment Securities, Gross Unrealized Loss, Less than 12 Months | (3) | |
Available-for-sale Investment Securities, Gross Unrealized Loss, More Than 12 Months | 0 | |
Available-for-sale Investment Securities, Gross Unrealized Losses | $ (3) |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Assets Measured at Fair Value on Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | $ 411,858 | $ 301,753 |
Total assets measured at fair value | 302,421 | |
Radionetics Warrant | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total assets measured at fair value | 668 | |
Level 1 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 202,813 | 93,879 |
Total assets measured at fair value | 93,879 | |
Level 1 | Radionetics Warrant | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total assets measured at fair value | 0 | |
Level 2 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 209,045 | 207,874 |
Total assets measured at fair value | 207,874 | |
Level 2 | Radionetics Warrant | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total assets measured at fair value | 0 | |
Level 3 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 0 | 0 |
Total assets measured at fair value | 668 | |
Level 3 | Radionetics Warrant | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total assets measured at fair value | 668 | |
U.S. Government and Agency Obligations [Member] | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 239,741 | 152,730 |
U.S. Government and Agency Obligations [Member] | Level 1 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 202,813 | 93,879 |
U.S. Government and Agency Obligations [Member] | Level 2 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 36,928 | 58,851 |
U.S. Government and Agency Obligations [Member] | Level 3 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 0 | 0 |
Certificates of Deposit [Member] | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 2,894 | 4,535 |
Certificates of Deposit [Member] | Level 1 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 0 | 0 |
Certificates of Deposit [Member] | Level 2 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 2,894 | 4,535 |
Certificates of Deposit [Member] | Level 3 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 0 | 0 |
Corporate Debt Securities [Member] | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 155,644 | 142,994 |
Corporate Debt Securities [Member] | Level 1 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 0 | 0 |
Corporate Debt Securities [Member] | Level 2 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 155,644 | 142,994 |
Corporate Debt Securities [Member] | Level 3 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 0 | 0 |
Commercial Paper [Member] | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 13,579 | |
Commercial Paper [Member] | Level 1 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 0 | |
Commercial Paper [Member] | Level 2 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 13,579 | |
Commercial Paper [Member] | Level 3 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | $ 0 | |
Asset-backed securities [Member] | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 1,494 | |
Asset-backed securities [Member] | Level 1 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 0 | |
Asset-backed securities [Member] | Level 2 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | 1,494 | |
Asset-backed securities [Member] | Level 3 | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Total Investment securities | $ 0 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Level 3 Derivative Asset fair value (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items] | ||||
Exercise of derivative asset | $ 668 | $ 0 | ||
Level 3 | ||||
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items] | ||||
Derivative asset at beginning of period | $ 668 | $ 99 | 668 | 68 |
Gain on change in fair value of derivative asset | 0 | 0 | 0 | 31 |
Exercise of derivative asset | (668) | 0 | (668) | 0 |
Derivative asset Balance at end of period | $ 0 | $ 99 | $ 0 | $ 99 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Oct. 15, 2021 | Aug. 31, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Dec. 31, 2022 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Stock issued under Employee Stock Purchase Plan, shares | 0 | 0 | ||||
Warrants to purchase shares of common stock, Exercise price, Per share | $ 18.14 | $ 18.14 | $ 17.79 | |||
Fair value assets transferred into level 3 | $ 0 | |||||
Fair value assets transferred into level 3 | $ 0 | |||||
Radionetics Warrant | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Additional common shares issued | 3,407,285 | 3,407,285 | ||||
Fair Value Adjustment of Warrants | $ 700 | |||||
Warrants to purchase shares of common stock, Exercise price, Per share | $ 0.00001 | |||||
Equity interest percentage | 22% | 22% |
Balance Sheet Details - Compone
Balance Sheet Details - Components of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid clinical costs | $ 3,052 | $ 2,567 |
Prepaid research and development costs | 1,606 | 2,293 |
Australian tax incentive receivable | 962 | 937 |
Prepaid insurance | 1,289 | 939 |
Interest receivable | 2,622 | 1,353 |
Due from Radionetics | 98 | 135 |
Landlord improvements receivable | 6,178 | 605 |
Option exercise receivable | 1,779 | 0 |
Other | 3,521 | 1,930 |
Total | $ 21,107 | $ 10,759 |
Balance Sheet Details - Compo_2
Balance Sheet Details - Components of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Property Plant And Equipment [Line Items] | ||
Property and equipment at cost | $ 14,639 | $ 7,584 |
Less accumulated depreciation and amortization | (4,875) | (4,084) |
Total | 9,764 | 3,500 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment at cost | 9,700 | 3,516 |
Lab Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment at cost | 3,958 | 3,168 |
Office Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment at cost | 935 | 859 |
Computers and Software | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment at cost | $ 46 | $ 41 |
Balance Sheet Details - Schedul
Balance Sheet Details - Schedule of Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Accounts Payable and Accrued Liabilities, Current [Abstract] | ||
Accounts payable | $ 5,842 | $ 6,883 |
Accrued clinical costs | 3,669 | 1,921 |
Accrued research and development costs | 3,101 | 4,043 |
Accrued outside services and professional fees | 2,908 | 1,810 |
Accrued landlord improvements | 5,424 | 359 |
Other accrued expenses | 991 | 335 |
Total | $ 21,935 | $ 15,351 |
Operating Lease - Additional In
Operating Lease - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Operating Leased Assets [Line Items] | |||||
Operating lease cost | $ 0.4 | $ 0.3 | $ 0.9 | $ 0.9 | |
2018 Operating Lease | |||||
Operating Leased Assets [Line Items] | |||||
Operating lease, initial term | 7 years | 7 years | |||
Operating lease expiration period | 2025-08 | ||||
Operating lease, option to extend term | five years | ||||
Lessee, operating lease, discount rate | 8% | 8% | |||
Irrevocable letter of credit | $ 0.5 | $ 0.5 | |||
Operating lease weighted average remaining term | 11 years 2 months 12 days | 11 years 2 months 12 days | 2 years 7 months 6 days | ||
Weighted-average discount rate | 8.60% | 8.60% | 8% | ||
2022 Operating Lease | |||||
Operating Leased Assets [Line Items] | |||||
Lessee operating lease description | Under the terms of the 2022 Lease, the Company's expected future monthly minimum lease payments of $0.5 million, with six months of rent abatement in the first year, start on the earlier of (i) the date which is ten (10) months after substantial completion of demolition work, or (ii) the date of the substantial completion of improvements and first occupancy for business purposes, and the term expires on the date immediately preceding the one hundred thirty-seventh (137th) monthly anniversary of this lease payment start date. Lease payments are subject to annual 3% increases. | ||||
Operating lease, option to extend term | The Company has (i) two options to extend the term of the 2022 Lease for an additional period of five (5) years each, and (ii) a right of first offer on adjacent space to the new facility, subject to the terms and conditions of the 2022 Lease. As of the date of the recording of the 2022 Lease, the Company is not reasonably certain that these options will be exercised. | ||||
Annual increase in lease payments | 3% | ||||
Lessee, operating lease, discount rate | 8.60% | 8.60% | |||
Irrevocable letter of credit | $ 0.8 | $ 0.8 | |||
Expected future monthly minimum lease payment with abatement | $ 0.5 | 0.5 | |||
Cash paid for operating lease liabilities | $ 0.3 | $ 0.9 |
Operating Lease - Schedule of F
Operating Lease - Schedule of Future Minimum Payments Under Non-cancellable Operating Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
2023 (3 months) | $ 689 | |
2024 | 5,587 | |
2025 | 7,501 | |
2026 | 6,829 | |
2027 | 7,034 | |
Thereafter | 56,985 | |
Total future minimum lease payments | 84,625 | |
Less imputed interest | (32,454) | |
Total operating lease liability | 52,171 | |
Less operating lease liability, current | (3,989) | $ (1,051) |
Operating lease liability, non-current | $ 48,182 | $ 2,024 |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Deferred Revenue Components (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Defined Benefit Plan Disclosure [Line Items] | |||||
Deferred revenues at beginning of period | $ 2,240 | ||||
Unearned revenue from cash received during the period, excluding amounts recognized as revenue during the period | 1,535 | $ (8,972) | |||
Balance at end of period | $ 1,662 | 1,662 | |||
Deferred revenue, non-current | 5,144 | 5,144 | $ 6,101 | ||
Sanwa Kagaku Kenkyusho Co., Ltd | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Deferred revenues at beginning of period | 7,152 | $ 9,431 | 8,341 | 0 | |
Unearned revenue from cash received during the period, excluding amounts recognized as revenue during the period | 0 | 0 | 0 | 8,972 | |
Revenue recognized that was included in deferred revenues | (346) | (459) | (1,535) | ||
Balance at end of period | 6,806 | 8,972 | 6,806 | 8,972 | |
Less deferred revenue, current | (1,662) | (2,320) | (1,662) | (2,320) | |
Deferred revenue, non-current | $ 5,144 | $ 6,652 | $ 5,144 | $ 6,652 |
Revenue Recognition (Additional
Revenue Recognition (Additional Information) (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Mar. 24, 2023 | Feb. 25, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Defined Benefit Plan Disclosure [Line Items] | |||||||
Upfront payment as license revenue | $ 300 | $ 500 | $ 1,500 | $ 4,000 | |||
Upfront payment as deferred revenue | 13,000 | 13,000 | |||||
Other assets, non-current | 2,000 | 2,000 | $ 37 | ||||
Sanwa Kagaku Kenkyusho Co., Ltd | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Revenue | 400 | 400 | |||||
Sanwa Kagaku Kenkyusho Co., Ltd | Radionetics | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Non refundable, upfront payment | $ 13,000 | ||||||
Additional milestone payments | 25,500 | ||||||
Sales and royalties milestones | $ 13,000 | ||||||
Cellular Longevity Inc doing business as Loyal [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Revenue | 2,100 | $ 1,500 | |||||
Non refundable, upfront payment | 100 | ||||||
Cellular Longevity Inc doing business as Loyal [Member] | Convertible Preferred Stock [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Upfront payment | $ 2,000 | ||||||
Other assets, non-current | $ 2,000 | $ 2,000 |
Stockholder's Equity - Addition
Stockholder's Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||||
Sep. 15, 2023 | Aug. 12, 2022 | Apr. 18, 2022 | Aug. 13, 2019 | Sep. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Oct. 31, 2021 | Aug. 10, 2021 | |
Subsidiary Sale Of Stock [Line Items] | ||||||||||
Proceeds from issuance of common stock, net | $ 150,000 | $ 75,000 | $ 340,267 | $ 117,242 | ||||||
Maximum amount of common stock preferred stock debt securities warrants and units to be issued | $ 300,000 | |||||||||
Maximum shares of common stock preferred stock debt securities warrants and units to be issued | 851,306 | |||||||||
Registration statement effective date | Aug. 29, 2019 | |||||||||
Common stock, shares issued | 66,708,000 | 66,708,000 | 53,877,000 | |||||||
Common Stock | ||||||||||
Subsidiary Sale Of Stock [Line Items] | ||||||||||
Sale of common stock | 11,441,648 | 5,625,563 | 11,442,000 | 11,965,000 | 5,626,000 | |||||
Common stock price per share | $ 30.59 | $ 22.22 | ||||||||
Proceeds from issuance of common stock, net | $ 328,500 | $ 117,200 | ||||||||
Offering discounts commissions and offering costs net | $ 21,500 | $ 7,800 | ||||||||
Common stock, shares issued | 50,500,000 | |||||||||
ATM Offering | ||||||||||
Subsidiary Sale Of Stock [Line Items] | ||||||||||
Proceeds from issuance of common stock, net | $ 11,300 | |||||||||
Common stock, shares issued | 522,807 | 522,807 |
Equity Incentive Plan - Additio
Equity Incentive Plan - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||
Jan. 01, 2023 | Feb. 28, 2015 | Nov. 30, 2023 | Jul. 31, 2018 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2021 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Total intrinsic value of options exercised | $ 6.3 | $ 5.6 | |||||||
Dividend yield | 0% | ||||||||
Employee share purchase plan awards | 0 | 0 | |||||||
Restricted Stock Units | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Unrecognized Stock-Based Compensation Cost 3 | $ 13.7 | $ 13.7 | |||||||
ESPP | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Annual increase in the number of shares available for issuance | 1% | ||||||||
Maximum percentage of eligible compensation to purchase common stock through payroll deductions | 20% | ||||||||
Unrecognized Stock-Based Compensation Cost 3 | 2 | $ 2 | |||||||
ESPP | Restricted Stock Units | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Unrecognized stock-based compensation cost | $ 89.9 | $ 89.9 | |||||||
Weighted-average period of unrecognized stock-based compensation cost expected to be recognized over remaining period | 2 years 1 month 6 days | ||||||||
Weighted-average period of unrecognized stock-based compensation cost expected to be recognized over remaining period 3 | 1 year 2 months 12 days | ||||||||
Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Weighted-average fair value of stock options granted to employees per share | $ 11.15 | $ 15.12 | $ 12.13 | $ 15.04 | |||||
Employee share purchase plan awards | 75,000 | 66,000 | |||||||
Common Stock | Restricted Stock Units | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Weighted-Average Period of Unrecognized Stock-Based Compensation Cost Expected to be Recognized Over Remaining Period 2 | 3 years 2 months 12 days | ||||||||
Common Stock | ESPP | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Plan expiration date | Jan. 01, 2028 | ||||||||
Additional shares available for future issuance | 2,693,859 | ||||||||
Shares reserved for issuance, authorized | 1,664,012 | 1,664,012 | |||||||
Additional shares available for future issuance | 538,771 | ||||||||
Weighted-average fair value of stock options granted to employees per share | $ 9.15 | $ 8.82 | |||||||
2021 Inducement Plan | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Remaining shares available for future issuance | 589,211 | 589,211 | |||||||
Additional shares available for future issuance | 1,500,000 | ||||||||
2021 Inducement Plan | Amended [Member] | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Remaining shares available for future issuance | 5,000,000 | 5,000,000 | |||||||
2021 Inducement Plan | Common Stock | Amended [Member] | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Additional shares available for future issuance | 7,500,000 | ||||||||
2018 Plan | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Plan expiration period | 2028-07 | ||||||||
Plan expiration term | 10 years | ||||||||
Vesting period | 4 years | ||||||||
Remaining shares available for future issuance | 2,549,748 | 2,549,748 | |||||||
Annual increase in the number of shares available for issuance | 5% | ||||||||
2015 Plan | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Plan expiration term | 10 years | ||||||||
Vesting period | 4 years |
Equity Incentive Plan - Summary
Equity Incentive Plan - Summary of Activity Under Stock Option activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2023 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Options Outstanding, Beginning balance | 9,757,329 |
Options Outstanding, Granted | 4,027,897 |
Options Outstanding, Exercised | (710,020) |
Options Outstanding, Forfeited and expired | (611,685) |
Options Outstanding, Ending balance | 12,463,521 |
Options Outstanding,Vested and expected to vest | 12,463,521 |
Options Exercisable, Ending balance | 5,137,282 |
Weighted-Average Exercise Price, Beginning balance | $ 17.79 |
Weighted-Average Exercise Price, Granted | 19.28 |
Weighted Average Exercise Price, Exercised | 17.65 |
Weighted Average Exercise Price, Forfeited and expired | 20.69 |
Weighted-Average Exercise Price, Ending balance | 18.14 |
Vested and expected to vest at September 30, 2023 | 18.14 |
Weighted-Average Exercise Price, Exercisable | $ 16.76 |
Weighted-Average Remaining Term, Ending balance | 8 years |
Weighted-Average Remaining Term, Vested and expected to vest | 8 years |
Weighted-Average Remaining Term, Exercisable | 6 years 8 months 12 days |
Aggregate Intrinsic Value, Ending balance | $ 144,674 |
Aggregate Intrinsic Value, Vested and expected to vest | 144,674 |
Aggregate Intrinsic Value, Exercisable | $ 66,733 |
Restricted Stock Units | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Options Outstanding, Beginning balance | 290,311 |
Options Outstanding, Granted | 666,621 |
Options Outstanding, Exercised | (81,294) |
Options Outstanding, Forfeited and expired | (45,142) |
Options Outstanding, Ending balance | 830,496 |
Weighted-Average Exercise Price, Beginning balance | $ 19.88 |
Weighted-Average Exercise Price, Granted | 16.62 |
Weighted Average Exercise Price, Exercised | 19.54 |
Weighted Average Exercise Price, Forfeited and expired | 19.77 |
Weighted-Average Exercise Price, Ending balance | $ 19.71 |
Equity Incentive Plan - Weighte
Equity Incentive Plan - Weighted Average Assumptions Used to Estimate Fair Value of Stock Options Granted to Employees (Details) | 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] | ||||
Expected dividend yield | 0% | |||
Stock Options | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Expected option term | 6 years 1 month 6 days | 6 years | 6 years | 6 years |
Expected volatility | 64% | 87% | 66% | 88% |
Risk free interest rate | 4.30% | 3.30% | 4.10% | 2.40% |
Expected dividend yield | 0% | 0% | 0% | 0% |
Employee Stock Purchase Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Expected option term | 1 year 1 month 6 days | 1 year 2 months 12 days | ||
Expected volatility | 57% | 76% | ||
Risk free interest rate | 4.90% | 2.20% | ||
Expected dividend yield | 0% | 0% |
Equity Incentive Plan - Stock-b
Equity Incentive Plan - Stock-based Compensation Expense Recognized (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | $ 11,049 | $ 7,434 | $ 29,320 | $ 20,320 |
Included in Research and Development | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 6,088 | 3,860 | 16,367 | 10,732 |
Included in General and Administrative | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | $ 4,961 | $ 3,574 | $ 12,953 | $ 9,588 |
Investment in Radionetics (Addi
Investment in Radionetics (Additional Information) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
Aug. 31, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Aug. 01, 2023 | Dec. 31, 2022 | Oct. 31, 2021 | |
Schedule of Investments [Line Items] | ||||||||
Stock issued under Employee Stock Purchase Plan, shares | 0 | 0 | ||||||
Common stock, shares issued | 66,708,000 | 66,708,000 | 53,877,000 | |||||
Investment in Radionetics | $ 4,671,000 | $ 4,671,000 | $ 0 | |||||
Loss on equity method investment | $ (997,000) | $ 0 | $ (997,000) | $ (1,010,000) | ||||
Warrants to purchase shares of common stock, Exercise price, Per share | $ 18.14 | $ 18.14 | $ 17.79 | |||||
Loss from 2023 Acquisition | $ (997,000) | (1,010,000) | ||||||
Stock issued under employee stock purchase plan, value | $ 1,123,000 | $ 813,000 | ||||||
Common stock, shares outstanding | 32,344,371 | 66,708,000 | 66,708,000 | 53,877,000 | ||||
Due from Radionetics | $ 98,000 | $ 98,000 | $ 135,000 | |||||
Reimbursement Earned | 21,000 | 53,000 | ||||||
Additional Sales Milestones | $ 15,000,000 | |||||||
R. Scott Struthers | ||||||||
Schedule of Investments [Line Items] | ||||||||
Amount of Annual Retainer | $ 50,000 | $ 50,000 | ||||||
Restricted Common Stocks | R. Scott Struthers | ||||||||
Schedule of Investments [Line Items] | ||||||||
Common stock, shares issued | 1,000,000 | 1,000,000 | ||||||
Vest Ratably Tenure | 36 months | 36 months | ||||||
Common Stock | ||||||||
Schedule of Investments [Line Items] | ||||||||
Stock issued under Employee Stock Purchase Plan, shares | 75,000 | 66,000 | ||||||
Common stock, shares issued | 50,500,000 | |||||||
Purchase of additional shares | 3,407,285 | |||||||
Warrants to purchase shares of common stock, Exercise price, Per share | $ 0.00001 | |||||||
Stock issued under employee stock purchase plan, value | $ 3,407,285 | |||||||
Interest Rate | 22% | |||||||
Preferred Stock | ||||||||
Schedule of Investments [Line Items] | ||||||||
Stock issued under Employee Stock Purchase Plan, shares | 14,404,656 | |||||||
Stock issued under employee stock purchase plan, value | $ 5,000,000 | |||||||
Nonconsolidated Investees, Other [Member] | Common Stock | ||||||||
Schedule of Investments [Line Items] | ||||||||
Ownership percentage | 64% | |||||||
Radionetics | ||||||||
Schedule of Investments [Line Items] | ||||||||
Stock issued under employee stock purchase plan, value | 5,000,000 | |||||||
Reimbursement Earned | $ 400,000 | |||||||
Radionetics | August 2023 Acquisition | ||||||||
Schedule of Investments [Line Items] | ||||||||
Investment in Radionetics | $ 4,700,000 | $ 4,700,000 | ||||||
Addition in equity method investment | $ 5,700,000 | |||||||
Loss on equity method investment | $ 1,000,000 | |||||||
Ownership percentage | 55% | 31% | 31% | |||||
Radionetics | Preferred Stock | ||||||||
Schedule of Investments [Line Items] | ||||||||
Stock issued under employee stock purchase plan, value | $ 5,000,000 | |||||||
Fair Value Adjustment of Warrants | $ 700,000 |