Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Mar. 10, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2021 | ||
Entity Registrant Name | Adicet Bio, Inc. | ||
Entity Central Index Key | 0001720580 | ||
Entity File Number | 001-38359 | ||
Trading Symbol | ACET | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Shell Company | false | ||
Entity Public Float | $ 226 | ||
Entity Common Stock, Shares Outstanding | 39,877,109 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Tax Identification Number | 81-3305277 | ||
Entity Incorporation, State or Country Code | DE | ||
Security Exchange Name | NASDAQ | ||
Title of 12(b) Security | Common Stock, par value $0.0001 per share | ||
Entity Address, Address Line One | 200 Clarendon Street | ||
Entity Address, Address Line Two | Floor 6 | ||
Entity Address, City or Town | Boston | ||
Entity Address, State or Province | MA | ||
City Area Code | 650 | ||
Local Phone Number | 503-9095 | ||
Entity Address, Postal Zip Code | 02116 | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
ICFR Auditor Attestation Flag | false | ||
Auditor Firm ID | 185 | ||
Auditor Name | KPMG LLP | ||
Auditor Location | Boston, Massachusetts | ||
Documents Incorporated by Reference | Part III of this Annual Report on Form 10-K incorporates by reference certain information from the registrant’s definitive Proxy Statement for its 2022 annual meeting of shareholders, scheduled to be held on June 2, 2022, which the registrant intends to file pursuant to Regulation 14A with the Securities and Exchange Commission not later than 120 days after the registrant’s fiscal year end of December 31, 2021. Except with respect to information specifically incorporated by reference in this Form 10-K, the Proxy Statement is not deemed to be filed as part of this Form 10-K. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 277,544 | $ 84,330 |
Short-term marketable debt securities | 0 | 10,284 |
Accounts Receivable - related party | 185 | |
Prepaid expenses and other current assets | 4,709 | 5,722 |
Total current assets | 282,438 | 100,336 |
Property and equipment, net | 14,643 | 2,790 |
Operating lease right-of-use asset | 20,358 | 23,066 |
Goodwill | 19,462 | 20,089 |
In-process research and development | 1,190 | |
Restricted cash | 150 | 4,527 |
Long-term marketable debt securities | 0 | |
Other non-current assets | 1,887 | 1,837 |
Total assets | 338,938 | 153,835 |
Current liabilities: | ||
Accounts payable | 3,263 | 1,552 |
Contract liabilities—related party, current | 4,805 | 13,980 |
Accrued and other current liabilities | 6,682 | 5,732 |
Operating lease liability | 1,567 | 1,215 |
Total current liabilities | 16,317 | 22,479 |
Operating lease liability, net of current portion | 19,377 | 20,424 |
Contingent consideration liability | 980 | |
Deferred tax liability | 125 | |
Other non-current liabilities | 115 | |
Total liabilities | 35,809 | 44,008 |
Commitments and contingencies (Note 12) | ||
Stockholders’ equity (deficit): | ||
Preferred stock, $0.0001 par value, 10,000,000 shares authorized as of December 31, 2021 and December 31, 2020, respectively; none issued and outstanding as of December 31, 2021 and December 31, 2020, respectively | ||
Common stock, $0.0001 par value, 150,000,000 shares authorized as of December 31, 2021 and December 31, 2020, respectively; 39,736,914 and 19,677,249 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively | 4 | 2 |
Additional paid-in capital | 471,449 | 216,126 |
Accumulated deficit | (168,324) | (106,325) |
Accumulated other comprehensive income | 24 | |
Total stockholders' equity | 303,129 | 109,827 |
Total liabilities, redeemable convertible preferred stock, and stockholders' equity | $ 338,938 | $ 153,835 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 39,736,914 | 19,677,249 |
Common stock, shares outstanding | 39,736,914 | 19,677,249 |
Preferred Stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock shares authorized | 10,000,000 | 10,000,000 |
Preferred stock shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | ||
Revenue—related party | $ 9,730 | $ 17,903 |
Operating expenses: | ||
Research and development | 48,943 | 34,334 |
General and administrative | 22,220 | 22,760 |
Total operating expenses | 71,163 | 57,094 |
Loss from operations | (61,433) | (39,191) |
Interest income | 91 | 785 |
Interest expense | (176) | (134) |
Other income (expense), net | (606) | (953) |
Loss before income tax benefit | (62,124) | (39,493) |
Income tax expense (benefit) | (125) | (2,815) |
Net loss | $ (61,999) | $ (36,678) |
Net loss per share attributable to common stockholders, basic and diluted | $ (2) | $ (5.01) |
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted | 30,952,152 | 7,319,977 |
Other comprehensive income (loss): | ||
Unrealized gain (loss) on marketable debt securities, net of tax | $ (24) | $ 1 |
Total other comprehensive income (loss) | (24) | 1 |
Comprehensive loss | $ (62,023) | $ (36,677) |
Consolidated Statements of Rede
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Redeemable Convertible Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) |
Balance at Dec. 31, 2019 | $ (60,366) | $ 9,258 | $ (69,647) | $ 23 | ||
Balance, temporary equity, shares at Dec. 31, 2019 | 97,166,921 | |||||
Balance, temporary equity at Dec. 31, 2019 | $ 114,083 | |||||
Balance, shares at Dec. 31, 2019 | 2,155,578 | |||||
Issuance of common stock upon exercise of stock options | 460 | $ 1 | 459 | |||
Issuance of common stock upon exercise of stock options, shares | 210,752 | |||||
Stock-based compensation expense | 5,263 | 5,263 | ||||
Conversion of shares of redeemable convertible preferred stock to shares of common stock in connection with the Merger | 114,083 | $ 1 | 114,082 | |||
Conversion of shares of redeemable convertible preferred stock to shares of common stock in connection with the Merger, shares | (97,166,921) | |||||
Conversion of shares of redeemable convertible preferred stock to shares of common stock in connection with the Merger | $ (114,083) | |||||
Conversion of shares of redeemable convertible preferred stock to shares of common stock in connection with the Merger, shares | 12,048,671 | |||||
Exchange of common stock in connection with the Merger | 83,516 | 83,516 | ||||
Exchange of common stock in connection with the Merger, shares | 5,207,695 | |||||
Issuance of common stock upon accelerated vesting ofrestricted stock units in connection with the Merger | 626 | 626 | ||||
Issuance of common stock upon accelerated vesting of restricted stock units in connection with the Merger (Shares) | 54,553 | |||||
Conversion of redeemable convertible preferred stock warrants to common stock warrants | 2,922 | 2,922 | ||||
Net loss | (36,678) | (36,678) | ||||
Other comprehensive loss | 1 | 1 | ||||
Balance at Dec. 31, 2020 | 109,827 | $ 2 | 216,126 | (106,325) | 24 | |
Balance, temporary equity, shares at Dec. 31, 2020 | 0 | |||||
Balance, temporary equity at Dec. 31, 2020 | ||||||
Balance, shares at Dec. 31, 2020 | 19,677,249 | |||||
Issuance of common stock upon exercise of stock options | $ 4,688 | 4,688 | ||||
Issuance of common stock upon exercise of stock options, shares | 1,125,339 | 1,125,339 | ||||
Issuance of common stock related to financing, net of issuance costs of $823,940 | $ 237,997 | $ 2 | 237,995 | |||
Issuance of common stock related to financing, net of issuance costs of $823,940, shares | 18,916,853 | |||||
Issuance of common stock for cashless exercise of warrants | ||||||
Issuance of common stock for cashless exercise of warrants, shares | 1,806 | |||||
Issuance of common stock resulting from Employee Stock Purchase Plan | 129 | 129 | ||||
Issuance of common stock resulting from Employee Stock Purchase Plan, shares | 15,667 | |||||
Stock-based compensation expense | 12,511 | 12,511 | ||||
Conversion of redeemable convertible preferred stock warrants to common stock warrants | ||||||
Net loss | (61,999) | (61,999) | ||||
Other comprehensive loss | (24) | (24) | ||||
Balance at Dec. 31, 2021 | $ 303,129 | $ 4 | $ 471,449 | $ (168,324) | ||
Balance, temporary equity, shares at Dec. 31, 2021 | 0 | |||||
Balance, temporary equity at Dec. 31, 2021 | ||||||
Balance, shares at Dec. 31, 2021 | 39,736,914 |
Consolidated Statements of Re_2
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Stock issuance cost | $ 823,940 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities | ||
Net loss | $ (61,999) | $ (36,678) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation and amortization expense | 1,538 | 1,226 |
Noncash lease expense | 2,529 | 725 |
Stock-based compensation expense | 12,511 | 5,263 |
Loss on disposal of assets for lease | 31 | |
Net amortization of premiums and accretion of discounts on investments | 10 | 5 |
Change in fair value of redeemable convertible preferred stock warrant liability | 897 | |
Impairment of in-process research and development | 1,190 | 2,300 |
Gain on remeasurement of contingent consideration liability | (980) | (1,900) |
Amortization of deferred debt issuance costs | 175 | 134 |
Changes in operating assets and liabilities: | ||
Accounts Receivable-related party | (30) | |
Prepaid expenses and other current assets | 1,634 | (3,233) |
Other non-current assets | 42 | (1,260) |
Accounts payable | 1,137 | (814) |
Contract liabilities—related party | (9,175) | (7,903) |
Operating lease liabilities | (511) | (859) |
Accrued and other current liabilities | 855 | 787 |
Other non-current liabilities | (9) | (242) |
Net cash used in operating activities | (51,052) | (41,552) |
Cash flows from investing activities | ||
Cash and restricted cash acquired in connection with the Merger | 64,114 | |
Proceeds from sales of marketable debt securities | 7,500 | |
Purchases of marketable debt securities | (5,700) | |
Proceeds from maturities of marketable debt securities | 2,750 | 57,793 |
Purchase of property and equipment | (13,046) | (990) |
Net cash provided by (used in) investing activities | (2,796) | 115,217 |
Cash flows from financing activities | ||
Proceeds from issuance of common stock, net of issuance costs | 238,129 | |
Proceeds from Employee Stock Purchase Plan | 129 | |
Proceeds from exercise of stock options | 4,688 | 460 |
Deferred issuance costs | (261) | (157) |
Net cash provided by financing activities | 242,685 | 303 |
Net change in cash, cash equivalents and restricted cash | 188,837 | 73,968 |
Cash, cash equivalents and restricted cash, at the beginning of the period | 88,857 | 14,889 |
Cash, cash equivalents and restricted cash, at the end of the period | 277,694 | 88,857 |
Reconciliation of cash, cash equivalents and restricted cash to consolidated balance sheets: | ||
Cash and cash equivalents | 277,544 | 84,330 |
Restricted cash | 150 | 4,527 |
Cash, cash equivalents and restricted cash, at the end of the period | 277,694 | 88,857 |
Supplemental cash flow information | ||
Cash paid for income taxes | 43 | 3 |
Cash received for income tax refunds | 2,766 | 664 |
Supplemental disclosures of noncash investing and financing activities | ||
Purchase of property and equipment included in accounts payable and accrued liabilities | 651 | 115 |
Common stock offering costs included in accrued liabilities at period end | 132 | |
Operating lease right-of-use asset obtained in exchange for operating lease liability | 22,367 | |
Conversion of redeemable convertible preferred stock into common stock | 114,083 | |
Conversion of redeemable convertible preferred stock warrants to common stock warrants | 2,922 | |
Fair value of net assets acquired in Merger | 84,142 | |
Adjustment to Goodwill | 413 | 650 |
Issuance of redeemable convertible preferred stock warrants in connection with the Loan Agreement | 144 | |
Topic 842 | ||
Supplemental disclosures of noncash investing and financing activities | ||
Right-of-use assets recognized upon adoption of Topic 842 | $ 1,424 |
Organization and Nature of Busi
Organization and Nature of Business | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Business | 1. Organization and Nature of the Business Adicet Bio, Inc. (formerly resTORbio, Inc. (resTORbio)), together with its subsidiaries, (the Company) is a clinical stage biotechnology company discovering and developing allogeneic gamma delta T cell therapies for cancer. The Company is advancing a pipeline of off-the-shelf gamma delta T cells, engineered with chimeric antigen receptors (CARs) and T cell receptor-like antibodies to enhance selective tumor targeting, facilitate innate and adaptive anti-tumor immune response, and improve persistence for durable activity in patients. The Company's approach to activate, engineer, and manufacture allogeneic gamma delta T cell product candidates derived from the peripheral blood cells of unrelated donors allows it to generate new product candidates in a rapid and cost efficient manner. The Company was incorporated in November 2014 in Delaware. The principal executive offices are located in Boston, Massachusetts. The Company also has another office in Menlo Park, California. Adicet Bio, Inc. (when referred to prior to the Merger (as defined below), (Former Adicet)) was incorporated in November 2014 in Delaware and was headquartered in Menlo Park, CA. Adicet Bio Israel Ltd. (formerly Applied Immune Technologies Ltd.) (Adicet Israel) is a wholly owned subsidiary of Former Adicet and is located in Haifa, Israel. Adicet Israel was founded in 2006. During 2019, Former Adicet consolidated its operations, including research and development activities, in the United States and as a result substantially reduced its operations in Israel. Merger with resTORbio Prior to September 15, 2020, the Company was a clinical-stage biopharmaceutical company known as resTORbio that had historically focused on developing innovative medicines that target the biology of aging, to prevent or treat age-related diseases with the potential to extend healthy lifespans. On April 28, 2020 , resTORbio entered into a definitive Merger Agreement with Former Adicet. Under the terms of the Merger Agreement, Former Adicet agreed to merge with a wholly owned subsidiary of resTORbio in an all-stock transaction with Former Adicet surviving as a wholly owned subsidiary of resTORbio and changing its name to “Adicet Therapeutics, Inc.” (such transactions, the Merger). Under the exchange ratio formula in the Merger Agreement, immediately following the Effective Time of the Merger, the securityholders of Former Adicet as of immediately prior to the Effective Time of the Merger owned approximately 75 % of the outstanding shares of the Company’s common stock on a fully-diluted basis and securityholders of resTORbio as of immediately prior to the Effective Time of the Merger owned approximately 25 % of the outstanding shares of the Company’s common stock on a fully-diluted basis (in each case excluding equity incentives available for grant). The Company concluded that the transaction represented a business combination pursuant to Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 805, Business Combinations . Further, Former Adicet was determined to be the accounting acquirer based upon the terms of the Merger and other factors including: (i) Former Adicet’s securityholders own approximately 75% of the voting rights of the combined company (on a fully-diluted basis excluding equity incentives available for grant); (ii) Former Adicet designated a majority (five of seven) of the initial members of the Board of Directors of the combined company; and (iii) the terms of the exchange of equity interests based on the exchange ratio at the announcement of the Merger factored in an implied premium to resTORbio’s stockholders. The composition of senior management of the combined company was determined to be a neutral factor in the accounting acquirer determination, as the combined company will leverage the expertise of the senior management of both companies. Accordingly, the reported operating results prior to the business combination are those of Former Adicet. On September 15, 2020, the Company completed the Merger pursuant to the Merger Agreement (the Effective Time). In connection with the Merger, and immediately prior to the Effective Time, resTORbio effected a reverse stock split of its common stock at a ratio of 1-for-7 (the Reverse Stock Split). Also, in connection with the Merger, the Company changed its name from “resTORbio, Inc.” to “Adicet Bio, Inc.” (the Name Change), Former Adicet changed its name from “Adicet Bio, Inc.” to “Adicet Therapeutics, Inc.” and the business conducted by the Company became primarily the business, which was previously conducted by Former Adicet, which is a biotechnology company discovering and developing allogeneic gamma delta T cell therapies for cancer and other diseases. At the Effective Time, each outstanding share of Former Adicet capital stock was converted into the right to receive 0.1240 (the Exchange Ratio) shares of Company’s common stock, as set forth in the Merger Agreement. The Exchange Ratio was determined based on the total number of outstanding shares of Company’s common stock and Former Adicet capital stock, each on a fully diluted basis, and the respective valuations of Former Adicet and resTORbio at the time of execution of the Merger Agreement. In connection with the Merger, the Company also assumed certain outstanding Former Adicet warrants and Former Adicet stock options under Former Adicet’s 2015 Stock Incentive Plan (the 2015 Adicet Stock Incentive Plan) and Former Adicet’s 2014 Share Option Plan (the 2014 Share Option Plan and, together with the 2015 Adicet Stock Incentive Plan, the Former Adicet Plans), with such stock options and warrants henceforth representing the right to purchase a number of shares of Company’s common stock equal to the Exchange Ratio multiplied by the number of shares of Former Adicet’s capital stock previously represented by such stock options and warrants, as applicable, with a proportionate adjustment in exercise price. Immediately following the Effective Time, there were approximately 19,589,828 shares of the Company’s common stock outstanding (post Reverse Stock Split), with the former equity holders of Former Adicet holding approximately 75 % of the outstanding shares of Company’s common stock on a fully-diluted basis and the former equity holders of resTORbio holding approximately 25 % of the outstanding shares of Company’s common stock on a fully-diluted basis (in each case excluding equity incentives available for grant). Please refer to Note 3 “Business Combinations” for further discussions of the Merger. Liquidity The Company has incurred significant net operating losses and negative cash flows from operations since inception and had an accumulated deficit of $ 168.3 million as of December 31, 2021. The Company has historically financed its operations primarily through a collaboration and licensing arrangement, the private placement of equity securities and debt, and cash received in the Merger. To date, none of the Company’s product candidates have been approved for sale and therefore the Company has not generated any revenue from product sales. Management expects operating losses and negative cash flows to continue for the foreseeable future, until such time, if ever, that it can generate significant sales of its product candidates currently in development. In February 2021, the Company completed an underwritten public offering of 10,575,513 shares of its common stock at a public offering price of $ 13.00 per share. The Company received net proceeds from the offering, after deducting underwriting discounts and commissions and offering expenses of approximately $ 128.8 million. In connection with the offering, the Company also entered into a stock purchase agreement with certain existing investors to purchase 1,153,840 shares of its common stock for $ 15.0 million at a price per share equal to the public offering price, with an initial closing for certain investors held simultaneously with the closing of the offering and a subsequent closing for certain additional investors. In December 2021, the Company closed an underwritten public offering, or the December 2021 Follow-On Offering, of 7,187,500 shares of its common stock at a public offering price of $ 14.00 per share. The Company received net proceeds from the offering, after deducting underwriting discounts and commissions and offering expenses of approximately $ 94.2 million. The Company expects that its cash and cash equivalents balances as of December 31, 2021, including the gross proceeds it received in February 2021 and December 2021 from its underwritten public offerings and the proceeds received from a stock purchase agreement with certain existing investors, will be sufficient to fund its forecasted operating expenses, capital expenditure requirements for at least the next twelve months from the issuance of these annual consolidated financial statements. All of the Company’s revenue to date is generated from the Regeneron Agreement, which is a collaboration and license agreement with Regeneron. The Company does not expect to generate any significant product revenue until it obtains regulatory approval of and commercialize any of the Company’s product candidates or enter into additional collaborative agreements with third parties, and it does not know when, or if, either will occur. The Company expects to continue to incur significant losses for the foreseeable future, and it expects the losses to increase as the Company continues the development of, and seek regulatory approvals for, its product candidates and begin to commercialize any approved products. The Company is subject to all of the risks typically related to the development of new product candidates, including, but not limited to, raising additional capital, development by its competitors of new technological innovations, risk of failure in preclinical and clinical studies, safety and efficacy of its product candidates in clinical trials, the risk of relying on external parties such as contract research organizations (CROs) and contract manufacturing organizations (CMOs), the regulatory approval process, market acceptance of the Company’s products once approved, lack of marketing and sales history, dependence on key personnel and protection of proprietary technology and it may encounter unforeseen expenses, difficulties, complications, delays, and other unknown factors that may adversely affect its business. Until such time as the Company can generate significant revenue from product sales, if ever, the Company expects to finance its operations through the sale of equity, debt financings, collaborative or other arrangements with corporate or other sources of financing. Adequate funding may not be available to the Company on acceptable terms or at all. The Company’s failure to raise capital as and when needed could have a negative impact on its financial condition and the Company’s ability to pursue its business strategies. Although the Company continues to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company to fund continuing operations, if at all. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The consolidated financial statements and related disclosures have been prepared in conformity with accounting principles generally accepted in the United States of America (United States GAAP or GAAP). Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The United States dollar is the functional and reporting currency of the Company and its subsidiaries. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities at the date of the consolidated financial statements as well as the reported amounts of revenues and expenses during the reporting period. Such estimates include the valuation of the intangible assets acquired in business combinations, redeemable convertible preferred stock warrant liability, redeemable convertible preferred stock tranche liability, the Technion Research and Development Foundation liability (TRDF Liability), contingent consideration liability for contingent value right (CVR), deferred tax assets, useful lives of property and equipment, accruals for research and development activities, revenue recognition and stock-based compensation and the Company’s incremental borrowing rate. Actual results could differ from those estimates. Contingent Consideration Liability (CVR) The estimated fair value of the CVR, initially measured and recorded on the acquisition date, is considered to be a Level 3 instrument. The contingent consideration liability is recorded at fair value at the end of each reporting period with changes in estimated fair values recorded in research and development expenses in the consolidated statements of operations and comprehensive loss. During the second quarter of 2021, the Company performed a re-measurement of the fair value of the CVR liability and adjusted the liability to zero. This resulted in a $ 1.0 million gain in research and development expense in the statements of operations and comprehensive loss for the year ended December 31, 2021. Goodwill Goodwill represents the excess of the purchase price over the fair value of net tangible and identified intangible assets acquired in a business combination. Goodwill is not amortized but is evaluated at least annually for impairment or when a change in facts and circumstances indicate that the fair value of the goodwill may be below the carrying value. Goodwill is tested for impairment at the reporting unit level annually in the fourth quarter, or more frequently when events or changes in circumstances indicate that the asset might be impaired. Examples of such events or circumstances include, but are not limited to, a significant adverse change in legal or business climate, an adverse regulatory action or unanticipated competition. The Company has determined that it operates in a single operating segment and has a single reporting unit. Prior to performing the impairment test, the Company assesses qualitative factors to determine whether the existence of events or circumstances would indicate that it is more likely than not that the fair value of the reporting unit was less than the carrying amount. If after assessing the totality of events or circumstances, the Company were to determine that it is more likely than not that the fair value of the reporting unit is less than the carrying amount, then the Company would perform a quantitative impairment test. The quantitative impairment test involves comparing the fair value of the reporting unit to the carrying value. If the fair value of the reporting unit exceeds the carrying value of the net assets, goodwill is not impaired, and no further testing is required. If the fair value of the reporting unit is less than the carrying value, the Company measures the amount of impairment loss, if any, as the excess of the carrying value over the fair value of the reporting unit. The Company performed an annual test for goodwill impairment in the fourth quarter of the fiscal year ended December 31, 2021 and determined that goodwill was no t impaired. Intangible Assets In connection with the Merger, the Company acquired certain IPR&D assets, which were classified as indefinite-lived intangible assets. Acquired IPR&D represents the fair value assigned to research and development assets that the Company acquires and have not been completed at the acquisition date. The fair value of IPR&D acquired in a business combination is recorded on the Company’s consolidated balance sheets at the acquisition-date fair value and is determined by estimating the costs to develop the technology into commercially viable products, estimating the resulting revenue from the products, and discounting the projected net cash flows to present value. IPR&D is not amortized, but rather is reviewed for impairment on an annual basis or more frequently if indicators of impairment are present, until the project is completed, abandoned, or transferred to a third party. The Company performed a review for impairment of IPR&D during the second quarter of the year ended December 31, 2021 and recognized an impairment charge of $ 1.2 million, which was recorded as research and development expenses in the consolidated statement of operations and comprehensive loss. Segments The Company operates and manages its business as one reportable and operating segment, which is the business of research and development of allogeneic immunotherapies for cancer and other diseases. The Company’s Chief Executive Officer, who is the chief operating decision maker, reviews financial information on an aggregate basis for purposes of allocating resources and evaluating financial performance. Concentration of Credit Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of cash and cash equivalents, and marketable debt securities. The Company’s cash and cash equivalents are held at two financial institutions in the United States and one financial institution in Israel and such amounts may, at times, exceed insured limits. The Company invests its cash equivalents and marketable debt securities in money market funds, United States government securities, commercial paper, corporate bonds, and asset-backed securities. The Company limits its credit risk associated with cash equivalents and marketable debt securities by placing them with banks and institutions it believes are highly creditworthy and in highly rated investments. The Company has not experienced any losses on its deposits of cash and cash equivalents and marketable debt securities to date. The Company has one customer, Regeneron, which represents 100 % of the Company’s total revenue during the years ended December 31, 2021 and 2020 and outstanding accounts receivable as of December 31, 2021 (see Note 10). Risks and Uncertainties The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, protection of proprietary technology, dependence on key personnel, compliance with government regulations and the need to obtain additional financing to fund operations. Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical studies, clinical trials, and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel infrastructure and extensive compliance and reporting. The Company’s product candidates are still in development and, to date, none of the Company’s product candidates have been approved for sale and, therefore, the Company has not generated any revenue from product sales. There can be no assurance that the Company’s research and development will be successfully completed, that adequate protection for the Company’s intellectual property will be obtained or maintained, that any products developed will obtain necessary government regulatory approval or that any approved products will be commercially viable. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will generate revenue from product sales. The Company operates in an environment of rapid change in technology and substantial competition from other pharmaceutical and biotechnology companies. The current COVID-19 (coronavirus) pandemic, which is impacting worldwide economic activity, poses risk that the Company or its employees, contractors, suppliers, and other partners may be prevented from conducting business activities for an indefinite period of time, including due to shutdowns that may be requested or mandated by governmental authorities. The extent to which the coronavirus impacts the Company’s operations will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the outbreak, new information that will emerge concerning the severity of the coronavirus and the actions to contain the coronavirus or treat its impact, among others. COVID-19 may impact the timing of regulatory approval of the INDs for clinical trials, the enrollment of any clinical trials that are approved, the availability of clinical trial materials and regulatory approval and commercialization of our products. COVID-19 may also impact the Company’s ability to access capital, which could negatively impact short-term and long-term liquidity. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with maturities of three months or less from the purchase date to be cash equivalents. As of December 31, 2021 and 2020, cash and cash equivalents consist of cash deposited with banks and investments in money market funds with maturities of three months or less from the date of purchase. Marketable Debt Securities Marketable debt securities are investments in marketable debt securities with maturities greater than three months at the time of purchase. The Company determines the appropriate classification of its investments in marketable debt securities at the time of purchase and reevaluates such designation at each balance sheet date. The Company has classified and accounted for its marketable debt securities as available-for-sale. The Company classifies highly liquid securities with maturities beyond 12 months as long-term marketable debt securities in the consolidated balance sheet. These securities are carried at fair value as determined based upon quoted market prices or pricing models for similar securities. Unrealized gains and losses, if any, are excluded from earnings and are reported as a component of accumulated other comprehensive income (loss). The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest income on the consolidated statements of operations and comprehensive loss. Realized gains and losses, if any, on available-for-sale securities are included in other income (expense), net. The cost of securities sold is based on the specific identification method. Interest and dividends on securities classified as available-for-sale are included in interest income. The Company did not have any outstanding marketable debt securities as of December 31, 2021 and did not identify any of its marketable debt securities as other-than-temporarily impaired as of December 31, 2020. Restricted Cash Restricted cash is comprised of cash that is restricted as to withdrawal or use under the terms of certain contractual agreements. Restricted cash for years ended December 31, 2021 and 2020 consists of collateral for letters of credit issued in connection with real estate leases (see Note 12). Fair Value of Financial Instruments The carrying amounts of certain financial instruments of the Company, including cash equivalents, restricted cash, accounts payable and accrued and other current liabilities approximate fair value due to their relatively short maturities. The Company’s marketable debt securities and CVR liability are carried at fair value (see Notes 4 and 5). Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed on a straight-line basis over the estimated useful lives of the related assets, generally three years. Leasehold improvements are amortized using the straight-line method over the shorter of the assets’ estimated useful lives or the remaining term of the lease. Maintenance and repairs are charged to operations as incurred. When assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the consolidated balance sheet and any resulting gain or loss is reflected in the consolidated statements of operations and comprehensive loss in the period realized. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Recoverability is measured by comparison of the carrying amount of the asset or asset group to the future net cash flows which the asset or asset group is expected to generate. If such asset or asset group is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset or asset group exceeds the fair value of the asset or asset group. There has been no such impairment of long-lived assets during the years ended December 31, 2021 and 2020. Revenue Recognition Under ASC 606, Revenue from Contracts with Customers (ASC 606), the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps as prescribed by ASC 606: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. A contract with a customer exists when (i) the Company enters into a legally enforceable contract with a customer that defines each party’s rights regarding the products or services to be transferred and identifies the payment terms related to these products or services, (ii) the contract has commercial substance and (iii) the Company determines that collection of substantially all consideration for products or services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company identifies the goods or services promised and determines the performance obligations by assessing whether each promised good or service is distinct. Goods or services that are not distinct are bundled with other goods or services in the contract until a bundle of goods or services that is distinct is created. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. All of the Company’s revenues are derived through a license and collaboration agreement (see Note 10). For revenue recognition purposes, the Company determines the term of its license or collaboration agreements by evaluating the period during which present and enforceable rights and obligations exist. This determination is impacted by the existence of substantive termination penalties, among other factors. The Company recognizes revenue under the Company’s license or collaboration agreements that are within the scope of ASC 606. These agreements include promises related to licenses to intellectual property and research and development services. If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenue from non-refundable, up-front fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgement to assess the nature of the combined performance obligation to determine whether the combined 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 from non-refundable, up-front fees. Accordingly, the transaction price is generally comprised of a fixed fee due at contract inception and at specified future dates, variable consideration in the form of milestone payments due upon the achievement of specified events and tiered royalties earned when customers recognize net sales of licensed products. The Company measures the transaction price based on the amount of consideration to which it expects to be entitled in exchange for transferring the promised goods and/or services to the customer. The Company utilizes the “most likely amount” method to estimate the amount of variable consideration to which it will be entitled for the contract. Amounts of variable consideration are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. At the inception of each arrangement that includes development and regulatory milestone payments, the Company evaluates whether the associated event is considered most likely to be achieved and estimates the amount to be included in the transaction price. Payments or reimbursements for the Company’s research and development efforts where such efforts are considered part of or a single performance obligation are recognized over time using a measure of progress that best reflects the Company’s performance in satisfying the obligation. Upfront payments are recorded as contract liabilities upon receipt or when due and may require deferral of revenue recognition to a future period until the Company performs its obligation under these arrangements. Amounts payable to the Company are recorded as accounts receivable when the Company’s right to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less. For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized any royalty revenue resulting from its collaboration arrangement. Research and Development Expenses Research and development expenses include costs directly attributable to the conduct of research and development programs, including payroll and related expenses, costs for CMOs, costs for CROs, materials, supplies, depreciation on and maintenance of research equipment, consulting costs, and the allocated portions of facility costs, such as rent, utilities, insurance, repairs and maintenance, depreciation, information technology costs and general support services. All costs associated with research and development are expensed within the consolidated statements of operations and comprehensive loss as incurred. Costs incurred in obtaining technology licenses are charged to research and development expense as acquired in-process research and development if the technology licensed has not reached technological feasibility and has no alternative future use. Accrued CRO, CMO, and Research and Development Expenses The Company has entered into various agreements with CMOs and CROs. The Company’s research and development accruals are estimated based on the level of services performed, progress of the studies, including the phase or completion of events, and contracted costs. The estimated costs of research and development provided, but not yet invoiced are included in accrued and other current liabilities on the consolidated balance sheets. If the actual timing of the performance of services or the level of effort varies from the original estimates, the Company will adjust the accrual accordingly. Payments made to CMOs and CROs under these arrangements in advance of the performance of the related services are recorded as prepaid expenses and other current assets on the consolidated balance sheets until the services are rendered. Through December 31, 2021 there had been no material adjustments to the Company’s prior period estimates of accrued research and development expenses. Leases Effective January 1, 2020, the Company adopted ASU No. 2016-02, Leases (Topic 842) (ASU 2016-02), using the modified retrospective approach through a cumulative-effect adjustment as of the adoption date, with prior periods unchanged and presented in accordance with the guidance in Topic 840, Leases (Topic 840). Consistent with ASU 2016-02, the Company determines if an arrangement is a lease, or contains a lease, at inception. Leases with a term greater than 12 months are recognized on the balance sheet as Right-of-Use (ROU) assets and current and long-term operating lease liabilities, as applicable. The Company has elected not to recognize on the balance sheet leases with terms of 12 months or less. The Company typically only includes an initial lease term in its assessment of a lease arrangement. Options to renew a lease are not included in the Company’s assessment unless there is reasonable certainty that the Company will renew. The Company monitors its plan to renew its leases no less than on a quarterly basis. In addition, the Company’s lease agreements generally do not contain any residual value guarantees or restrictive covenants. In accordance with ASU 2016-02, the ROU assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate (IBR), which is the estimated rate the Company would be required to pay for a fully collateralized borrowing equal to the total lease payments over the term of the lease, to determine the present value of future minimum lease payments. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. For lease agreements entered into or reassessed after the adoption of ASU 2016-02, the Company does not combine lease and non-lease components. Variable lease payments are expenses as incurred. Assumptions made by the Company at the commencement date are re-evaluated upon occurrence of certain events, including a lease modification. A lease modification results in a separate contract when the modification grants the lessee an additional right of use not included in the original lease and when lease payments increase commensurate with the standalone price for the additional right of use. When a lease modification results in a separate contract, it is accounted for in the same manner as a new lease. Fair Value of Common Stock Prior to the Merger the fair value of the Company’s common stock was determined by its Board of Directors with input from management and third-party valuation specialists. The Company’s approach to estimate the fair value of the Company’s common stock is consistent with the methods outlined in the American Institute of Certified Public Accountants Practice Aid, Valuation of Privately-Held- Company Equity Securities Issued as Compensation . Determining the best estimated fair value of the Company’s common stock requires significant judgement and management considers several factors, including the Company’s stage of development, equity market conditions affecting comparable public companies, significant milestones and progress of research and development efforts. Subsequent to the Merger, the fair value of the Company’s common stock is determined based on its closing market price. Stock-Based Compensation The Company accounts for stock-based compensation arrangements with employees and non-employees using a fair value method which requires the recognition of compensation expense for costs related to all stock-based payments including stock options. The fair value method requires the Company to estimate the fair value of stock-based payment awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option-pricing model to estimate the fair value of options granted that are expensed on a straight-line basis over the requisite service period, which is generally the vesting period. The Company accounts for forfeitures as they occur. Option valuation models, including the Black-Scholes option-pricing model, require the input of several assumptions. Changes in the assumptions used can materially affect the grant-date fair value of an award. These assumptions include the risk-free rate of interest, expected dividend yield, expected volatility and the expected life of the award. For awards that have a performance condition, the Company recognizes compensation expense based on its assessment of the probability that the performance condition will be achieved, using an accelerated attribution model, over the explicit or implicit service period. Income Taxes The Company accounts for income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences attributable to differences between carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting purposes and for operating loss and tax credit carryforwards. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. The Company’s deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which these temporary differences are expected to be recovered or settled. A valuation allowance is recorded to reduce deferred tax assets if it is determined that it is more likely than not that all or a portion of the deferred tax asset will not be realized. The Company considers many factors when assessing the likelihood of future realization of deferred tax assets, including recent earnings results, expectations of future taxable income, carryforward periods available and other relevant factors. The Company records changes in the required valuation allowance in the period that the determination is made. The Company assesses its income tax positions and records tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances and information available as of the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, the Company records the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority having full knowledge of all relevant information. For those income tax positions where it is not more likely than not that a tax benefit will be sustained, the Company does not recognize a tax benefit in the consolidated financial statements. The Company records interest and penalties related to uncertain tax positions, if applicable, as a component of income tax expense (benefit). Comprehensive Income (Loss) Comprehensive income (loss) is defined as a change in equity of a business enterprise during a period, resulting from transactions from non-owner sources. The other comprehensive loss disclosed in the Company’s consolidated statements of operations and comprehensive loss for the years ended December 31, 2021 and 2020 consists of changes in unrealized gains and losses on marketable debt securities. Net Loss per Share Attributable to Common Stockholders Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common stock outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common stock and potentially dilutive securities outstanding for the period. The Company’s potentially dilutive shares, which include outstanding stock options, Employee Stock Purchase Plan awards, unvested restricted stock units (RSUs), and shares issuable upon conversion of the Convertible Notes, are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. Basic and diluted net loss per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. The two-class method determines net income (loss) per share for each class of common and participating securities according to dividends declared or accumulated and participation rights in undistributed earnings. The two-class method requires income (loss) available to common stockholders for the period to be allocated between common and participating securities based upon their respective rights to share in undistributed earnings as if all income (loss) for the period had been distributed. The Company’s participating securities do not have a contractual obligation to share in the Company’s losses. As such, the net loss is attributed entirely to common stockholders. Since the Company has reported a net loss for all periods presented, diluted net loss per common share is the same as basic net loss per common share for those periods. Subsequent Events Considerations The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the consolidated financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. The Company has evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure, other than as disclosed in these notes to the consolidated financial statements. See Note 21 for further information. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB under its ASC or other standard setting bodies and adopted by the Company as of the specified effective date, unless otherwise discussed below. Recently Adopted Accounting Pronouncements In August 2018, the FASB issued ASU No. 2018-15, Intangibles–Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract (ASU 2018-15). The amendments in ASU 2018-15 align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). Accordingly, the update requires entities in a hosting arrangement that is a service contract to follow the guidance in ASC 350-40, Internal-Use Software (ASC 350-40) to determine which implemen |
Business Combination
Business Combination | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Business Combination | 3. Business Combination On September 15, 2020, Former Adicet completed its merger with resTORbio. Based on the Exchange Ratio of 0.1240 , immediately following the Merger, resTORbio stockholders and holders of resTORbio restricted stock units and options to acquire resTORbio common stock owned approximately 25.0 % of the outstanding capital stock of the combined company on a fully diluted basis, and Former Adicet stockholders, holders of options or warrants to acquire Former Adicet capital stock owned approximately 75.0 % of the outstanding capital stock of the combined company on a fully diluted basis. resTORbio’s stockholders continued to own and hold their existing shares of the Company’s common stock (after giving effect to the 1-for-7 reverse stock split). Pursuant to the terms of the Merger, the vesting of all outstanding resTORbio stock options was accelerated in full as of immediately prior to the Effective Time. All out-of-the-money resTORbio stock options were cancelled for no consideration. All in-the-money resTORbio stock options remained outstanding after the completion of the Merger in accordance with their terms. For accounting purposes, the Company assumed 81,370 in-the-money resTORbio stock options after giving effect to reverse stock split. In addition, 91,309 unvested resTORbio restricted stock units outstanding and unsettled, after giving effect to reverse stock split, as of immediately prior to the Effective Time of the Merger, were accelerated in full and the holders of such restricted stock units received 54,553 shares of the Company’s common stock (after reduction by the number of shares of resTORbio common stock necessary to satisfy applicable tax withholding obligations at the maximum statutory rate). The fair value of these modified stock options and restricted stock units attributable to pre-combination services was recorded as a component of consideration transferred and the fair value of these modified stock options and restricted stock units attributable to post-combination services was recognized as stock compensation expense in the Company’s consolidated statements of operations and comprehensive loss. At the closing of the Merger, all shares of Former Adicet common stock and Former Adicet redeemable convertible preferred stock then outstanding were converted to Former Adicet’s common stock under their original terms and were then exchanged for the Company’s common stock. In connection with the Merger, the Company entered into a Contingent Value Rights Agreement (the CVR Agreement) with Computershare Inc. and Computershare Trust Company, N.A. as joint rights agent. Per the terms of the Merger, each holder of resTORbio common stock as of immediately prior to the completion of the Merger is entitled to one contractual contingent value right, subject to and in accordance with the terms and conditions of the CVR Agreement, for each share of resTORbio common stock held by such holder as of immediately prior to the Effective Time. The CVR holders were entitled to receive net proceeds from the commercialization, if any, from a third-party commercial partner of RTB101, resTORbio’s small molecule product candidate that is a potent inhibitor of target of rapamycin complex 1 (TORC1), for a COVID-19 related indication. The total purchase price was allocated to the tangible and intangible assets acquired and liabilities assumed of resTORbio based on their fair values as of the completion of the Merger, with the excess allocated to goodwill. The purchase price is calculated based on the fair value of resTORbio common stock that the resTORbio stockholders owned as of the closing date of the Merger because, with no active trading market for shares of Former Adicet, the fair value of the resTORbio’s common stock represented a more reliable measure of the fair value of consideration transferred in the Merger. The following summarizes the purchase price in the Merger (in thousands, except share and per share amounts): Fair value of common stock shares of the combined company $ 84,142 Fair value of contingent consideration liability with respect to CVR (2) 2,880 Purchase price $ 87,022 (1) Represents the share consideration of the combined company that the resTORbio stockholders own as of the closing of the Merger calculated as follows: Number of shares of the combined company owned by resTORbio 5,207,695 Multiplied by the fair value per share of resTORbio common $ 16.59 Acquisition date fair value of resTORbio 86,396 Estimated fair value of modified stock options and restricted stock units attributable to pre-combination services (3) 626 Less: portion of the fair value to be distributed as CVR (c) ( 2,880 ) Fair value of shares of the combined company owned by resTORbio $ 84,142 a. Represents the number of shares of common stock of the combined company that the resTORbio stockholders owned as of the closing of the Merger. This amount is calculated as 5,207,695 shares (post-reverse stock split) of resTORbio common stock outstanding as of September 15, 2020. b. The fair value of shares of the combined company owned by resTORbio stockholders is based on the closing price of resTORbio common stock on September 14, 2020. c. The fair value of resTORbio common stock was further adjusted to remove the estimated fair value of the CVR embedded within the closing price, as each holder of resTORbio stock received one contractual CVR immediately prior to the Merger. (2) Each holder of resTORbio common stock as of immediately prior to the completion of the Merger was entitled to one CVR issued by resTORbio, subject to and in accordance with the terms and conditions of the CVR Agreement, for each share of resTORbio common stock held by such holder as of immediately prior to the Effective Time of the Merger. (3) Based on the capitalization of resTORbio as of September 15, 2020, 91,309 outstanding unvested resTORbio restricted stock units were accelerated in connection with the Merger and holders of the restricted stock units were issued approximately 54,553 shares of resTORbio common stock on a net settlement basis. Similarly, in connection with the Merger, vesting of outstanding resTORbio stock options was accelerated in full and the stock options that were not in the in-the-money on the close of the Merger were canceled, resulting in approximately 81,370 surviving stock options. The acquisition date fair value of these modified resTORbio restricted stock units and resTORbio stock options attributable to the pre-combination services is included in the estimated purchase price. The Merger was accounted for as a business combination which requires that assets acquired, and liabilities assumed be recognized at their fair value as of the acquisition date. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to value the assets acquired and liabilities assumed on the acquisition date, its estimates and assumptions are subject to refinement. Fair value estimates are based on a complex series of judgments about future events and uncertainties and rely heavily on estimates and assumptions. The judgments used to determine the estimated fair value assigned to each class of assets acquired and liabilities assumed, as well as asset lives, can materially impact the Company’s results of operations. The following summarizes the allocation of the purchase price to the net tangible and intangible assets acquired (in thousands): As of Measurement Period Adjustments Final Purchase Net assets acquired: Cash and cash equivalents $ 63,869 $ — $ 63,869 Prepaid expenses and other current assets 3,059 615 3,674 Property and equipment 318 — 318 IPR&D 3,490 — 3,490 Restricted cash 245 — 245 Accounts payable ( 1,316 ) 12 ( 1,304 ) Accrued and other current liabilities ( 2,365 ) — ( 2,365 ) Other liabilities — — — Deferred tax liability ( 367 ) — ( 367 ) Goodwill 20,089 ( 627 ) 19,462 Purchase price $ 87,022 $ — $ 87,022 The goodwill of $ 19.5 million is not tax deductible and represents the excess of the consideration paid over the fair value of assets acquired and liabilities assumed. Goodwill is mainly attributable to the enhanced value of the combined company, as reflected in the increase in market value of the resTORbio common shares following the announcement of the Merger with Former Adicet. The fair value of acquired IPR&D is related to the research and development of RTB101 for a COVID-19 related indication and was conducted pursuant to resTORbio's license agreement with Novartis (see Note 11). The RTB101 compound IPR&D project was valued using an income approach, specifically a projected discounted cash flow method, adjusted for the probability of technical success (PTS). The projected discounted cash flow models used to estimate the Company’s IPR&D reflect significant assumptions regarding the estimates a market participant would make in order to evaluate a drug development asset, including the following: • Estimates of potential cash flows to be generated by the project and resulting asset, which was developed utilizing estimates of total patient population, market penetration rates, demand risk adjustment factors, and product pricing; • Estimates regarding the timing of and the expected costs of goods sold, research and development expenses, selling, general and administrative expenses to advance the clinical programs to commercialization, cash flow adjustments and partner profit split; • The projected cash flows were then adjusted using PTS factors that were selected considering both the current state of clinical development and the nature of the proposed indication, (i.e., respiratory therapeutics); and • Finally, the resulting probability adjusted cash flows were discounted to a present value using a risk-adjusted discount rate, developed considering the market risk present in the forecast and the size of the asset. This IPR&D intangible asset is not amortized, but rather is reviewed for impairment on an annual basis or more frequently if indicators of impairment are present, until the project is completed, abandoned, or transferred to a third party. Upon the review of impairment indicators of IPR&D during the second quarter of 2021, the Company concluded that the IPR&D was fully impaired and recorded an impairment charge within research and development expenses in the consolidated statement of operations and comprehensive loss for the remaining balance of the IPR&D intangible asset June 30, 2021. The Company recognized IPR&D impairment charges of $ 2.3 million, $ 0.5 million, and $ 0.7 million for the quarters ended as of December 31, 2020, March 31, 2021, and June 30, 2021. On July 29, 2021, the Company sent Novartis a termination notice. Termination will automatically take effect as of 60 days from the date of delivery of the termination notice to Novartis, but in no event later than October 1, 2021 without any further notice or action required of either Novartis or the Company. The contingent consideration for the CVR was valued using an income approach, leveraging the probability adjusted discounted cash flow used in the valuation of the IPR&D and then deducting the administrative fee to be retained by the combined company and other permitted deductions in order to arrive at the net cash expected to be paid out to the CVR holders. The probability adjusted cash flow includes significant estimates and assumptions pertaining to commercialization events and cash consideration received by the Company for the grant of rights to commercialize RTB101 during the term of the CVR Agreement (as discussed above). These cash flows were then discounted to present value using the same discount rate applied in the valuation of the IPR&D. Transaction costs for the Merger were $ 7.1 million for the year ended December 31, 2020 and were expensed as incurred in general and administrative expenses in the consolidated statements of operations and comprehensive loss. The following tables present changes in the Company's IPR&D and CVR since the Merger (in thousands): Acquisition Date Change in As of Change in As of In-process research and development $ 3,490 $ ( 2,300 ) $ 1,190 $ ( 1,190 ) $ — Contingent Value Rights $ 2,880 $ ( 1,900 ) $ 980 $ ( 980 ) $ — |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 4. Fair Value Measurements The Company determines the fair value of financial and non-financial assets and liabilities using the fair value hierarchy which establishes three level of inputs that may be used to measure fair value, as follows: Level 1 — Observable inputs, such as quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Unobservable inputs which reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values (in thousands): December 31, 2021 Level 1 Level 2 Level 3 Total Assets: Money market funds (1) $ 147,071 $ — $ — $ 147,071 Total fair value of assets $ 147,071 $ — $ — $ 147,071 December 31, 2020 Level 1 Level 2 Level 3 Total Assets: Money market funds (1) $ 63,817 $ — $ — $ 63,817 Marketable debt securities (2) Asset-backed securities — 7,522 — 7,522 Corporate debt securities — 1,762 — 1,762 Commercial paper — 1,000 — 1,000 Marketable debt securities — 10,284 — 10,284 Total fair value of assets $ 63,817 $ 10,284 $ — $ 74,101 Liabilities: Contingent consideration $ — $ — $ 980 $ 980 Total fair value of liabilities $ — $ — $ 980 $ 980 (1) Included in cash and cash equivalents in the consolidated balance sheets (2) Included in short-term marketable debt securities in the consolidated balance sheets. Money market funds are included within Level 1 of the fair value hierarchy because they are valued using quoted market prices. Corporate debt securities, commercial paper and asset-backed securities are classified within Level 2 of the fair value hierarchy as they take into consideration valuations obtained from third-party pricing services. The pricing services utilize industry standard valuation models, including both income-based and market-based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate the fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities, prepayment/default projections based on historical data and other observable inputs. As part of the acquisition of resTORbio, the Company entered into a CVR Agreement and recorded the fair value of the CVR as part of consideration transferred. The Company considers the contingent consideration liability a Level 3 instrument (one with significant unobservable inputs) in the fair value hierarchy. In June 2021, the Company determined the possibility of any commercialization events for RTB101 was close to zero (see Note 3). As a result, the fair value of the CVR liability was adjusted to zero . On October 27, 2021, the Company provided a Termination Notice under the CVR Agreement to the joint rights agents to terminate its obligations under the CVR Agreement, effective immediately. |
Marketable Debt Securities
Marketable Debt Securities | 12 Months Ended |
Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Debt Securities | 5. Marketable Debt Securities The following tables summarize the Company’s marketable debt securities (in thousands): December 31, 2020 Amortized Unrealized Unrealized Fair Asset-backed securities $ 7,507 $ — $ 15 $ 7,522 Corporate debt securities 1,754 — 8 1,762 Commercial paper 999 — 1 1,000 Total $ 10,260 $ — $ 24 $ 10,284 The following table summarizes the classification of the Company’s marketable debt securities in the consolidated balance sheets (in thousands): December 31, 2021 2020 Short-term marketable debt securities $ — $ 10,284 Long-term marketable debt securities — — Total $ — $ 10,284 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Dec. 31, 2021 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepaid Expenses and Other Current Assets | 6. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): December 31, 2021 2020 Prepaid Insurance $ 1,884 $ 1,443 Prepayments to CRO's 1,658 420 Prepaid Maintenance 1,021 761 Prepayments to CMO's 115 135 Other current assets 2 229 Tax receivable — 2,711 Interest receivable 29 23 Total $ 4,709 $ 5,722 |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | 7. Property and Equipment, net Property and equipment, net consisted of the following (in thousands): As of December 31, Useful life (years) 2021 2020 Laboratory equipment 3 $ 5,502 $ 4,350 Leasehold improvements Lesser of useful life 1,614 1,427 Furniture and fixtures 3 303 524 Construction in progress — 13,014 1,090 Computer equipment 3 216 93 Software 3 320 170 20,969 7,654 Less: Accumulated depreciation and ( 6,326 ) ( 4,864 ) Property and equipment, net $ 14,643 $ 2,790 Depreciation and amortization expense for each of the years ended December 31, 2021 and 2020 was $ 1.5 million and $ 1.2 million, respectively. All of the Company’s property and equipment as of December 31, 2021 and 2020 is located in the U.S. Construction in progress has increased by $ 11.9 million due to building construction related to the Company's leased space in Redwood City. Construction in process will continue to increase through the first half of 2022, until completion of construction. |
Accrued and Other Current Liabi
Accrued and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued and Other Current Liabilities | 8. Accrued and Other Current Liabilities Accrued and other current liabilities consisted of the following (in thousands): December 31 2021 2020 Accrued compensation $ 4,020 $ 3,833 Accrued CMO costs 1,077 244 Accrued professional services 546 363 Accrued research and development expenses 504 65 Accrued other liabilities 503 272 Accrued CRO costs 32 955 Total $ 6,682 $ 5,732 |
Term Loan
Term Loan | 12 Months Ended |
Dec. 31, 2021 | |
Term Loan [Abstract] | |
Term Loan | 9. Term Loan On April 28, 2020, the Company entered into a Loan and Security Agreement with Pacific Western Bank (PacWest) for a term loan not exceeding $ 12.0 million (the Loan Agreement) to finance leasehold improvements for the facilities in Redwood City, CA and other purposes permitted under the Loan Agreement, with an interest rate equal to the greater of 0.25 % above the Prime Rate (as defined in the Loan Agreement) or 5.00 %. The Loan Agreement granted to Pacific Western Bank a security interest on substantially all of the Company’s assets other than intellectual property to secure the performance of the Company’s obligations under the Loan Agreement, and contains a variety of affirmative and negative covenants, including required financial reporting, limitations on certain dispositions of assets or distributions, limitations on the incurrence of additional debt or liens and other customary requirements. As of December 31, 2021, the Company was in compliance with such covenants. Pursuant to the Loan Agreement in April 2020, the Company may request to draw upon the term loan at any time through the date eighteen months after the date of the Loan Agreement (Availability End Date), which was October 28, 2021 . No amounts were drawn under the Loan Agreement through the Availability End Date. On October 21, 2021, the Company amended the Loan Agreement with PacWest (the Loan Amendment) under which PacWest will provide one or more Term Loans, as well as Non-Formula Ancillary Services which shall not exceed $ 5.5 million in the aggregate. Non-Formula Ancillary Services are defined as automated clearinghouse transactions, corporate credit card services, letters of credit, or other treasury management services. The aggregate sum of the outstanding Term Loans and Non-Formula Ancillary Services shall at no time exceed $ 15.0 million, which each Term Loan to be in an amount of not less than $1.0 million. As of December 31, 2021, the Company had outstanding Non-Formula Ancillary Services of $ 4.4 million. Accordingly, as of December 31, 2021, the Company has $ 10.6 million available under the Term Loan. Pursuant to the Loan Amendment, the interest rate for the Term Loans shall be set at an annual rate equal to the greater of (i) 0.25% above the Prime Rate then in effect and (ii) 4.25%. As of December 31, 2021, the deferred debt issuance costs were $ 0.1 million and are included in other non-current assets on the Company’s consolidated balance sheets. |
Regeneron License and Collabora
Regeneron License and Collaboration Arrangement | 12 Months Ended |
Dec. 31, 2021 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Regeneron License and Collaboration Arrangement | 10. Regeneron License and Collaboration Arrangement Agreement Terms On July 29, 2016, the Company entered into a license and collaboration agreement with Regeneron, which was amended in April 2019, with such amendment becoming effective in connection with Regeneron’s investment in the Company’s Series B redeemable convertible preferred stock private placement transaction in July 2019 (as amended, the Regeneron Agreement). Agreement Structure . The Regeneron Agreement has two principal components: (a) a research collaboration component under which the parties will research, develop, and commercialize next-generation engineered gamma delta immune cell therapeutics (ICPs), namely engineered gamma delta immune cells with CARs and TCRs directed to disease-specific cell surface antigens, which includes the grant of certain licenses to intellectual property between the two parties, and (b) for a certain period following the effective date, a license to the Company to use certain of Regeneron’s proprietary mice to develop and commercialize ICPs generated by the Company, with certain limitations relating to targets under the Regeneron Agreement. Research Collaboration . Research activities under the collaboration are governed by research plans, which include the strategy, goals, activities, and responsibilities of the parties with respect to a target. The Company is primarily responsible for generating, validating, and optimizing ICPs, developing processes for manufacture of ICPs, and certain preclinical and clinical manufacturing activities for ICPs; Regeneron’s key responsibility is generating, validating, and optimizing CARs and TCRs that bind to the applicable target. The parties have formed a joint research committee to monitor and govern the research and development efforts during the research program term. Rights to Research Targets . Under the terms of the collaboration, the parties will conduct research on mutually agreed upon targets. Regeneron may obtain exclusive rights for the targets that it chooses in accordance with the target selection mechanism set forth in the Regeneron Agreement, and the Company similarly may obtain exclusive rights for targets it chooses in accordance with such target selection mechanism. The Company has the right to develop and commercialize ICPs to the first collaboration target to come out of the research program. On January 28, 2022, the Company received a payment of $ 20.0 million from Regeneron for exercise of its option to license exclusive rights to ADI-002 and Regeneron potentially has additional options to other ICP targets under the Regeneron Agreement. Pursuant to the Agreement with Regeneron, the Company had the right to elect to co-fund ADI-002's future development costs. The Company did not elect its option. For those targets it does not have an option to license, Regeneron has a right of first negotiation for up to two targets. Regeneron has the right to terminate the research program in its entirety (a) for convenience on six months prior written notice given at any time after December 31, 2019, or (b) following a change of control (as defined in the Regeneron Agreement) of the Company. The parties mutually agreed to their first product declaration criteria for collaboration ICP, CD20, in 2018. Rights to Company-Developed Targets . Regeneron has an exclusive license to use targeting moieties generated by the Company by its use of Regeneron’s proprietary mice to develop and commercialize non-ICPs. Exclusivity . During the five-year target selection period that expired in July 2021, the Company may not directly or indirectly research, develop, manufacture or commercialize an ICP, or grant a license to do the foregoing, except pursuant to the agreement. For so long as either party is researching or developing an ICP to a target under the research program, neither party may research, develop, manufacture or commercialize any other ICP to such target, or grant a license to do the foregoing. And for so long as a party is researching, developing or commercializing an ICP to target that is licensed to it (and royalty bearing) under the agreement, neither party may research, develop, manufacture or commercialize any other ICP to such target, or grant a license to permit another party to do the foregoing. These exclusivity obligations are limited to engineered gamma delta immune cells to targets reasonably considered to have therapeutic relevance in oncology. The Regeneron Agreement includes certain exceptions to the exclusivity obligations of the parties, including with respect to targets that are rejected by one party in the target selection process, as well as protections in the event of a change of control of a party where the acquirer has a competing program. Co-Funding and Profit Sharing . The Company has an option to co-fund specified portions of the future development costs for, and to co-promote, ICPs to a target for which Regeneron has exercised an option, and to participate in the profits for such target. The Company has the right to exercise this right in various geographic regions, including on a worldwide basis. In the event the Company exercises such right, the parties will share further development costs and profits proportionally to their co-funding percentages. Financial Terms . The Company received a non-refundable upfront payment of $ 25.0 million from Regeneron upon execution of the Regeneron Agreement and has received an aggregate of $ 20.0 million of additional payments for research funding from Regeneron as of December 31, 2021. In addition, Regeneron may have to pay the Company additional amounts in the future consisting of up to an aggregate of $ 80.0 million of option exercise fees for a certain number of collaboration ICPs, as specified in the Regeneron Agreement. Regeneron must also pay the Company high single digit royalties as a percentage of net sales for ICPs to targets for which it has exclusive rights, and low single digit royalties as a percentage of net sales on any non-ICP product comprising a targeting moiety generated by the Company through the use of Regeneron’s proprietary mice. The Company must pay Regeneron mid-single to low double digit, but less than teens, of royalties as a percentage of net sales of ICPs to targets for which the Company has exercised exclusive rights, and low to mid-single digit of royalties as a percentage of net sales of targeting moieties generated from the Company’s license to use Regeneron’s proprietary mice. Royalties are payable until the longer of the expiration or invalidity of the licensed patent rights or twelve (12) years from first commercial sale. Other Terms . The Regeneron Agreement contains customary representations, warranties and covenants by the Company and Regeneron and includes (i) an obligation of the Company to use commercially reasonable efforts to develop and commercialize at least one product based on a collaboration ICP that is not an optioned collaboration ICP for each collaboration target and (ii) an obligation of Regeneron to use commercially reasonable efforts to develop and commercialize at least one product based on an optioned collaboration ICP for each collaboration target. The Company and Regeneron are required to indemnify the other party against all losses and expenses related to breaches of its representations, warranties and covenants under the Regeneron Agreement. Term and Termination . The term of the Regeneron Agreement expires, on a product-by-product basis, on the expiration of the obligation to pay royalties for such product. The Regeneron Agreement is subject to early termination by either party upon uncured material breach by the other party. The licenses to develop and commercialize an ICP to a target that one party has exclusively licensed may be terminated by such party for convenience. Equity Investments . In connection with its collaboration, Regeneron and the Company entered into a side letter pursuant to which, among other matters, Regeneron was granted certain stockholder rights and investment rights in connection with the Company’s next equity financing that met certain criteria and in connection with an initial public offering by the Company. Regeneron exercised its investment right and purchased approximately $ 10.0 million of the Company’s Series B redeemable convertible preferred stock in a private placement transaction in July 2019. The remaining obligations under the side letter agreement terminated immediately prior to the Effective Time of the Merger. Revenue Recognition The Company identified the following material promises under the Regeneron Agreement: (1) a research license, (2) a collaboration invention license, (3) a trademark license, (4) research and development services during the research term, (5) manufacturing services to manufacture collaboration ICPs for the research programs, (6) participation in the joint research committee, and (7) information sharing during the research term. The Company considered that the licenses granted under the Regeneron Agreement are not capable of being distinct and are not distinct from the research and development and manufacturing services within the context of the Regeneron Agreement, because 1) such licenses are for the research and development effort during the research term, unless Regeneron exercises its option under the Regeneron Agreement, 2) the research and development services significantly increase the utility of such licenses, and 3) research and development services require collaboration ICPs being manufactured. Specifically, the Company’s granted licenses can only provide benefit to Regeneron in combination with the Company’s research and development and manufacturing services to discover the collaboration ICPs. Similarly, the participation in the joint research committee and information sharing are not capable of being distinct and are not distinct from the research and development and manufacturing services within the context of the agreement, because the participation in the joint research committee is for monitoring and governing of the research and development efforts and the information sharing is for sharing results of such research and development efforts. Therefore, all of the promises above are combined into a single performance obligation. The Company also evaluated whether the option provided to Regeneron represents a material right that would require separate deferral and recognition. The option exercise will provide Regeneron with a development and commercial license to develop and commercialize the optioned collaboration ICPs. The Company concluded that the $25.0 million upfront payment to the Company was not negotiated to provide incremental discount for the future option fees payable upon Regeneron’s exercise of the option. Regeneron could decide not to exercise the option at its own discretion. The exercise of the option by Regeneron is not certain and is dependent on many factors, such as progress made on the specific option-eligible collaboration ICP, Regeneron’s overall assessment of commercial feasibility of the further research, development and commercialization of the Option products, availability and cost of alternative programs and products. The option provides Regeneron with a license for intellectual property that will be improved from the inception of the Regeneron Agreement. In addition, the option fee is significant compared to the sum total of the upfront payment and research funding fees in the original Regeneron Agreement. Therefore, the Company determined that the option provided to Regeneron does not represent a material right and that any potential exercise of the option should be accounted as a separate contract. Hence, upon the option exercise by Regeneron the option fee would be allocated to the development and commercial license which would be the only performance obligation in that separate contract and recognized as revenue when control of the license rights is transferred to Regeneron. For revenue recognition purposes, the Company determined that the duration of the contract is the same as the research term of five years beginning on the execution of the Regeneron Agreement on July 29, 2016. The contract duration is defined as the period during which parties to the contract have present and enforceable rights and obligations. For revenue recognition purposes, the five-year term has been extended to the first quarter of 2022 due to additional time required to complete the performance obligation under the Regeneron Agreement. The Company determined that Regeneron faces significant in-substance penalties were it to terminate the Regeneron Agreement prior to the end of the research term. At contract inception, the Company determined the transaction price of the Regeneron Agreement to be $ 55.0 million, consisting of the $ 25.0 million upfront payment and the aggregate research funding fees of $ 30.0 million payable over the research term. In order to determine the transaction price, the Company evaluated all the payments to be received during the duration of the contract. Per the terms of the original Regeneron Agreement prior to the amendment effective from July 2019, the research funding fees of $ 30.0 million were payable merely due to the passage of time and therefore did not represent a variable consideration. After the amendment became effective in July 2019, $ 20.0 million of these fees became contingent upon meeting certain development and regulatory milestones. Therefore, the Company concluded that after the amendment such potential payments became variable consideration. The receipt of the variable consideration was subject to substantial uncertainty and was therefore excluded from the transaction price upon the effective date of the amendment. Accordingly, the transaction price was reduced to $ 35.0 million in July 2019. The Company re-evaluates the transaction price if there is a significant change in facts and circumstances at least at the end of each reporting period. The Company increased the transaction price by $ 10.0 million in June 2020 to $ 45.0 million when it achieved the milestone for the selection of a clinical candidate to the second collaboration target under the Regeneron Agreement, resulting in the recognition of an additional $ 5.0 million in revenue during the three months ended June 30, 2020. The Company also considered the existence of any significant financing component within the Regeneron Agreement given its upfront payment structure. Based upon this assessment, the Company concluded that the up-front payment was provided for valid business reasons and not for the purpose of providing financing. The reason for the initial advance payment at the beginning of the contract is not to provide financing to the Company, but to ensure Regeneron’s commitment to the contract and to provide assurance that the customer will perform its obligations under the contract. Accordingly, the Company has concluded that the upfront payment structure of the Regeneron Agreement does not result in the existence of a significant financing component. The royalty payments will be recognized when the related sales occur as they were determined to relate predominantly to the intellectual property licenses granted to Regeneron and therefore have also been excluded from the transaction price. The Company has determined that the combined performance obligation is satisfied over time. ASC 606 requires the Company to select a single revenue recognition method for the performance obligation that depicts the Company’s performance in transferring control of the services. Accordingly, the Company utilizes a cost-based input method to measure proportional performance and to calculate the corresponding amount of revenue to recognize. The Company believes this is the best measure of progress because it reflects how the Company transfers its performance obligation to Regeneron. In applying the cost-based input method of revenue recognition, the Company uses actual costs incurred relative to budgeted costs to fulfill the combined performance obligation. These costs consist primarily of internal full-time equivalent effort and third-party contract costs. Revenue is recognized based on actual costs incurred as a percentage of total budgeted costs as the Company completes its performance obligations over the research term of five years. A cost-based input method of revenue recognition requires management to make estimates of costs to complete the Company’s performance obligations. In making such estimates, significant judgment is required to evaluate assumptions related to cost estimates. The cumulative effect of revisions to estimated costs to complete the Company’s performance obligations will be recorded in the period in which changes are identified and amounts can be reasonably estimated. A significant change in these assumptions and estimates could have a material impact on the timing and amount of revenue recognized in future periods. The following table presents changes in the Company’s contract liabilities (in thousands): Year ended December 31, 2021 Balance at beginning Additions Additions (Deductions) (1) Balance at Contract liability $ 13,980 $ — $ ( 9,175 ) $ 4,805 Year ended December 31, 2020 Balance at beginning Additions Additions (Deductions) (1) Balance at Contract asset $ — $ 10,000 $ ( 10,000 ) $ — Contract liability $ 21,883 $ 10,000 $ ( 17,903 ) $ 13,980 (1) Deductions to contract liabilities relate to deferred revenue recognized as revenue during the reporting period. As of December 31, 2021, contract liabilities related to the Regeneron Agreement of $ 4.8 million was comprised of the $ 25.0 million upfront payment, $ 10.0 million in total research funding fees for fiscal years 2017 and 2018, and $ 10.0 million for achievement of the milestone for the selection of a clinical candidate for the second collaboration target in June 2020, less $ 40.2 million of cumulative license and collaboration revenue recognized from the inception of the Regeneron Agreement as of December 31, 2021 and will be recognized as the combined performance obligation is satisfied. As of December 31, 2020, contract liabilities related to the Regeneron Agreement of $ 14.0 million was comprised of the $ 25.0 million upfront payment, $ 10.0 million in total research funding fees for fiscal years 2017 and 2018, and $ 10 million for achievement of the milestone for the selection of a clinical candidate to the second collaboration target in June 2020, less $ 31.0 million of cumulative license and collaboration revenue recognized from the inception of the Regeneron Agreement as of December 31, 2020. For the years ended December 31, 2021 and 2020, the Company recognized $ 9.2 million and $ 17.9 million of license and collaboration revenue, respectively, from amounts included in the contract liability balances at the beginning of the period. There were no costs to obtain or fulfill the contract that meet the criteria to be capitalized. |
License Funding and Other Agree
License Funding and Other Agreements Related to the CVR | 12 Months Ended |
Dec. 31, 2021 | |
License Funding And Other Agreements [Abstract] | |
License, Funding and Other Agreements Related to the CVR | 11. License, Funding and Other Agreements Related to the CVR Contingent Value Rights Agreement As discussed in Note 3, in connection with the Merger, the Company entered into the CVR Agreement with Computershare Inc. and Computershare Trust Company, N.A. as joint rights agent. The CVR holders are entitled to receive net proceeds from the commercialization, if any, received from a third-party commercial partner of RTB101 for a COVID-19 related indication. The total fees and expenses of the Company’s clinical trials for a COVID-19 related indication of RTB101 is limited to $ 3.0 million under the CVR Agreement. Through October 31, 2020, the Company’s total accumulated spend was $ 1.1 million of expenses. In November 2020, management terminated the nursing home study due to slow enrollment and as a consequence lowered the probability of finding a partner due to the delay in time to commercialization of RTB101. In February 2021, management terminated the National Institute on Aging study of RTB101 for COVID-19 post-exposure prophylaxis in adults age 65 years and older due to poor enrollment . In March 2021, management estimated that the probability of finding a partner should be further reduced. As a result, the fair value of the CVR liability was decreased by $ 0.4 million to $ 0.6 million. In June 2021, the Company determined the possibility of any commercialization events for RTB101 was close to zero (see Note 3). As a result, the fair value of the CVR liability was adjusted to zero . On October 27, 2021, the Company provided a Termination Notice under the CVR Agreement to the joint rights agent to terminate its obligations under the CVR Agreement, effective immediately. Novartis License Agreement On March 23, 2017, resTORbio entered into an exclusive license agreement with Novartis International Pharmaceutical Ltd. (Novartis). Under the agreement, Novartis granted resTORbio an exclusive, field-restricted, worldwide license, to certain intellectual property rights owned or controlled by Novartis, to develop, commercialize and sell one or more therapeutic products comprising RTB101 or RTB101 in combination with everolimus in a fixed dose combination. The exclusive field under the license agreement is for the treatment, prevention and diagnosis of disease and other conditions in all indications in humans and animals. The agreement may be terminated by either party upon a material breach of obligation by the other party that is not cured with 60 days after written notice. resTORbio may terminate the agreement in its entirety or on a product-by-product or country-by-country basis with or without cause with 60 days’ prior written notice. As consideration for the license, resTORbio is required to pay up to an aggregate of $ 4.3 million upon the satisfaction of clinical milestones, up to an aggregate of $ 24 million upon the satisfaction of regulatory milestones for the first indication approved, and up to an aggregate of $ 18 million upon the satisfaction of regulatory milestones for the second indication approved. In addition, resTORbio is required to pay up to an aggregate of $ 125 million upon the satisfaction of commercial milestones, based on the amount of annual net sales. resTORbio is also required to pay tiered royalties ranging from a mid-single digit percentage to a low-teen digit percentage on annual net sales of products. These royalty obligations last on a product-by-product and country-by-country basis until the latest of (i) the expiration of the last valid claim of a Novartis patent covering a subject product, (ii) the expiration of any regulatory exclusivity for the subject product in a country, or (iii) the 10 th anniversary of the first commercial sale in the country, and are subject to a reduction after the expiration of the last valid claim of a Novartis patent or the introduction of a generic equivalent of a product in a country. On July 27, 2021, the Company sent Novartis a termination notice. Termination automatically took effect on September 25, 2021, 60 days from the date of delivery of the termination notice to Novartis, without further notice of action required of either Novartis or the Company. National Institute of Health In May 2019, resTORbio was awarded a 5 -year grant for up to $ 1.5 million from the NIH to study RTB101 and the regulation of antiviral immunity in the elderly. resTORbio is entitled to use the award solely to conduct the research and is solely responsible for commencing and conducting the research and will furnish periodic progress updates to the NIH throughout the term of the award. After completing the research, resTORbio must provide the NIH with a formal report describing the work performed and the results of the research. For funds received under the NIH funding agreement, resTORbio recognizes a reduction in research and development expenses in an amount equal to the qualifying expenses incurred in each period up to the amount funded by the NIH. Qualifying expenses incurred by resTORbio in advance of funding by the NIH are recorded in the consolidated balance sheets as other current assets. For the year ended December 31, 2021, $ 0.4 million qualifying expenses have been incurred and $ 0.5 million have been funded by the NIH. The difference in the amount incurred by the Company and funded by the NIH was due to timing of requesting reimbursements from the NIH. On a cumulative basis as of December 31, 2021, $ 1.3 million has been incurred and $ 1.3 million has been funded by the NIH. |
Commitments and Contingences
Commitments and Contingences | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingences | 12. Commitments and Contingencies Operating Leases The Company leases office and laboratory space in Menlo Park, CA, Redwood City, CA, and Boston, MA. As of December 31, 2021, except as described below, there have been no material changes in lease obligation from those disclosed in Note 12 to consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2020. On June 25, 2021, the Company entered into an amendment to the Menlo Park lease to extend the term of the lease from March 31, 2022 to June 30, 2022 and replace the previously leased premises (known as 173 and 175-177 Jefferson Drive) with another nearby premises (known as 235 Constitution Drive). The lease commenced on July 15, 2021 and expires on June 30, 2022 . In connection with these changes, the Company will incur monthly rent payments ranging from $ 87,286 to $ 89,904 , increasing over the remaining term of the lease. Given the lease is short-term in nature, the Company is using the practical expedient for the lease and has not recorded a right of use asset or lease liability. Therefore, the Company will recognize rent expense on a straight-line basis over the lease term. On July 19, 2021, the Company entered into a Sublease (the Sublease Agreement) with RFS OPCO LLC (Sublessee), whereby the Company agreed to sublease to Sublessee all of the 9,501 rentable square feet of office space in Boston, MA, currently leased by the Company pursuant to the Company’s lease with 500 Boylston & 222 Berkeley Owner (DE) LLC, dated January 8, 2018, as amended (the Master Lease). The term of the sublease started on September 1, 2021 and ends on July 30, 2026. The aggregate base rent due to the Company under the Sublease is approximately $ 3.5 million starting October 1, 2021. The Company records sublease income as a reduction of lease expense. Upon execution of the Sublease Agreement, the Company received a cash security deposit of $ 0.1 million from the Subleasee which is recorded as other non-current liabilities in the consolidated balance sheets. The expected undiscounted cash flows to be received from the sublease as of December 31, 2021 is as follows (in thousands): 2022 657 2023 671 2024 685 2025 699 2026 416 Total $ 3,128 The Company recognized rent expense, net of sublease income, of $ 4.3 million and $ 0.9 million for the years ended December 31, 2021 and 2020, respectively. The IBR and the remaining lease terms of our facilities and their weighted average IBR and remaining terms are as follows as of December 31, 2021: Lease Locations IBR Remaining Terms Redwood City, CA 6.90 % 8.2 Boston, MA 9.30 % 4.6 Menlo Park, CA 6.80 % 0.5 Weighted Average 7.20 % 7.7 The following table contains a summary of the lease costs recognized under ASC 842 and other information pertaining to the Company’s operating leases for the years ended December 31, 2021 and 2020: December 31 2021 2020 Lease Cost (in thousands) (in thousands) Operating lease cost $ 4,282 $ 894 Short-term lease cost 235 56 Variable lease cost — — Sublease Income ( 223 ) — Total lease cost $ 4,294 $ 950 Other Information Operating cash flows used for lease liabilities $ 511 $ 859 Operating lease right of use asset obtained in exchange of operating lease liability $ — $ 22,367 As of December 31, 2021, operating right-of-use assets were $ 20.4 million and operating lease liabilities were $ 20.9 million. The Company has no material finance leases. The maturities of the operating lease liabilities as of December 31, 2021 were as follows (in thousands): 2022 2,933 2023 3,428 2024 3,525 2025 3,625 2026 and thereafter 13,747 Total undiscounted lease payments 27,258 Less: imputed interest 6,314 Total operating lease liability 20,944 Less: current portion 1,567 Operating lease liability, net of current maturities $ 19,377 The Company maintains letters of credit of $ 4.1 million, $ 0.2 million, and $ 0.2 million in connection with the Company’s office leases in Redwood City, CA, Menlo Park, CA, and Boston, MA, respectively. As of December 31, 2021, the cash amount associated with the Menlo Park Lease is recorded as restricted cash on the consolidated balance sheet. As of December 31, 2020, all cash amounts are recorded as restricted cash on the consolidated balance sheet. Indemnification Agreements In the ordinary course of business, the Company enters into agreements that may include indemnification provisions. Pursuant to such agreements, the Company may indemnify, hold harmless and defend an indemnified party for losses suffered or incurred by the indemnified party. Some of the provisions will limit losses to those arising from third-party actions. In some cases, the indemnification will continue after the termination of the agreement. The maximum potential amount of future payments the Company could be required to make under these provisions is not determinable. The Company has never incurred material costs to defend lawsuits or settle claims related to these indemnification provisions. The Company has also entered into indemnification agreements with its directors and officers that require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers to the fullest extent permitted by Delaware corporate law. The Company currently has directors’ and officers’ liability insurance. Legal Proceedings In connection with the Merger, seven lawsuits were filed against the Company, its directors, Former Adicet, and/or Merger Sub. which were either dismissed or settled for of $ 0.2 million in the fourth quarter of 2020. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Common Stock | 13. Stockholders' Equity Common Stock Common stockholders are entitled to dividends if and when declared by the Board of Directors subject to the prior rights of the preferred stockholders. As of December 31, 2021 and 2020, no dividends on common stock had been declared by the Board of Directors. In February 2021, the Company completed an underwritten public offering of 10,575,513 shares of its common stock at a public offering price of $ 13.00 per share. The Company received net proceeds from the offering, after deducting underwriting discounts and commissions and offering expenses of approximately $ 128.8 million. In connection with the February 2021 offering, the Company also entered into a stock purchase agreement with certain existing investors to purchase 1,153,840 shares of our common stock for $ 15.0 million at a price per share equal to the public offering price, with an initial closing for investors held simultaneously with the closing of the offering and a subsequent closing for certain additional investors. In December 2021, the Company closed an underwritten public offering, or the December 2021 Follow-On Offering, of 7,187,500 shares of its common stock at a public offering price of $ 14.00 per share. The Company received net proceeds from the offering, after deducting underwriting discounts and commissions and offering expenses of approximately $ 94.2 million. The Company has the following shares of common stock reserved for future issuance: December 31, 2021 2020 Stock options available for future grant 1,961,338 1,739,621 Stock options issued and outstanding 3,875,317 3,706,945 Unvested restricted stock units 771,660 — Common stock warrants issued and outstanding 220,890 226,191 Total common stock reserved 6,829,205 5,672,757 Warrants to Purchase Shares of Common Stock In February 2021, PacWest exercised 5,301 warrants, which resulted in the net issuance was 1,806 shares of common stock. The following provides a roll forward of outstanding warrants: Number of Weighted Weighted Outstanding and exercisable warrants to purchase 226,191 $ 11.3177 5.66 Issued — Exercised ( 5,301 ) Outstanding and exercisable warrants to purchase 220,890 $ 11.3177 4.66 As of December 31, 2021, the Company's outstanding warrants to purchase shares of common stock consisted of the following: Number of Exercise Classification Expiration Date September 15, 2020 101,610 $ 11.3177 Equity July 25, 2026 September 15, 2020 30,924 $ 11.3177 Equity August 21, 2026 September 15, 2020 77,312 $ 11.3177 Equity September 19, 2026 September 15, 2020 11,044 $ 11.3177 Equity September 26, 2026 220,890 |
At-the-Market (ATM) Offering
At-the-Market (ATM) Offering | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
At-the-Market (ATM) Offering | 14. At-the-Market (ATM) Offering On December 1, 2020, the Company entered into a Sales Agreement (the 2020 Sales Agreement) with Evercore Group L.L.C. and H.C. Wainwright & Co., LLC (collectively, the Agents), pursuant to which the Company may sell, from time to time, at its option, up to an aggregate of $ 50.0 million of shares of the Company’s common stock, through the Agents, as its sales agents. No sales of Shares have been made under the 2020 Sales Agreement. The ATM offering was terminated in February 2021 . On March 12, 2021, the Company entered into a Sales Agreement (the 2021 Sales Agreement) with JonesTrading Institutional Services (the Agent), pursuant to which the Company could sell, from time to time, at its option, up to an aggregate of $ 75.0 million of shares of its common stock, through the Agent, as its sales agent. No shares were sold under the 2021 Sales Agreement as of December 31, 2021. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | 15. Stock-Based Compensation Stock-based Compensation Expense The following table presents stock-based compensation expense as reflected in the Company's consolidated statements of operations and comprehensive loss (in thousands): Year Ended December 31, 2021 2020 Research and development $ 4,759 $ 1,674 General and administrative 7,752 3,589 Total stock-based compensation $ 12,511 $ 5,263 Summary of Plans The Plans are administered by the Board of Directors or, at the discretion of the Board of Directors, by a committee of the Board of Directors. The exercise prices, vesting and other restrictions are determined at the discretion of the Board of Directors, or its committee if so delegated, except that the exercise price per share of stock options may not be less than 100% of the fair market value of the share of common stock on the date of grant and the term of the stock option may not be greater than ten years. Incentive stock options granted to employees and restricted stock awards granted to employees, officers, members of the Board of Directors, advisors, and consultants of the Company typically vest over four years. Non-statutory options granted to employees, officers, members of the Board of Directors, advisors, and consultants of the Company typically vest over three or four years. Shares that are expired, terminated, surrendered or canceled under the Plans without having been fully exercised will be available for future awards. In addition, shares of common stock that are tendered to the Company by a participant to exercise an award are added to the number of shares of common stock available for the grant of awards. The 2017 Plan and 2018 Plan In 2017, resTORbio adopted the 2017 Plan. In connection with resTORbio’s initial public offering completed in January 2018, the resTORbio Board adopted and resTORbio’s stockholders approved the 2018 Plan. The 2018 Plan provides that the number of shares reserved and available for issuance under the plan will automatically increase each January 1, beginning on January 1, 2019, by 4 % of the outstanding number of shares of resTORbio’s common stock on the immediately preceding December 31 or such lesser number of shares as determined by the Board. On April 27, 2021, the stockholders approved an amendment and restatement of the 2018 Stock Option and Incentive Plan, to, among other things, increase the aggregate number of shares authorized for issuance under the 2018 Plan by 1,500,000 shares, plus on January 1, 2022 and each January 1, thereafter, the number of shares authorized for issuance shall be increased by the lesser of 5% of the number of shares of Common Stock issued and outstanding on the immediately preceding December 31, or such lesser number as determined by the compensation committee. On January 1, 2022, the number of shares reserved and available for issuance under the 2018 Plan automatically increased by 1,986,845 shares of Common Stock equal to 5 % of the number of shares of Common Stock issued and outstanding on December 31, 2021. Since the date of effectiveness of the 2018 Plan, resTORbio has not and the Company will not grant any further awards under the 2017 Plan. However, any shares of common stock subject to awards under the 2017 Plan that expire, terminate, or otherwise are surrendered, canceled, forfeited or repurchased without having been fully exercised or resulting in any common stock being issued will become available for issuance under the 2018 Plan. As of December 31, 2021, there are no outstanding options under the 2017 Plan. As of December 31, 2021, the number of shares of common stock available for grant under the 2017 and 2018 Plan is 1,683,999 . As of December 31, 2021, an aggregate of 2,574,170 shares of common stock were issuable upon the exercise of outstanding stock options under the 2017 Plan and 2018 Plans at a weighted average exercise price of $ 15.10 per share. In addition to this amount, as of December 31, 2021, 771,660 shares of common stock were issuable upon the vesting of 6,410 performance stock units (PSUs) granted in May 2021, 205,250 RSUs granted in August 2021, and 560,000 RSUs and PSUs granted in October 2021. The 2014 Plan and 2015 Plan As of December 31, 2021, the number of shares of common stock available for grant under the 2014 and 2015 Plan is 277,339 . As of December 31, 2021, an aggregate of 915,657 shares of common stock were issuable upon the exercise of outstanding stock options under the 2015 plan at a weighted average exercise price of $ 11.46 per share and an aggregate of 22,987 shares of common stock were issuable upon the exercise of outstanding stock options under the 2014 Plan at a weighted average exercise price of $ 1.61 per share. Since the date of effectiveness of the Merger, the Company has not and will not grant any further awards under the 2014 Plan. 2018 Employee Stock Purchase Plan The 2018 ESPP provides that the number of shares reserved and available for issuance will automatically increase each January 1, beginning on January 1, 2019 and increasing each January 1 thereafter through January 1, 2028, by the least of (i) 1 % of the outstanding number of shares of the Company’s common stock on the immediately preceding December 31; (ii) 77,703 shares or (iii) such number of shares as determined by the ESPP administrator. On January 1, 2020, as a result of the foregoing evergreen provision, the number of shares of common stock available for issuance under the 2018 ESPP automatically increased from 79,369 to 131,432 shares. On January 1, 2021, as a result of the foregoing evergreen provision, the number of shares of common stock available for issuance under the 2018 ESPP automatically increased from 131,432 to 524,775 . During the 2021 Annual Meeting of the stockholders held on April 27, 2021, the stockholders approved an amendment and restatement of the Company's 2018 ESPP. As a result, the Company increased the shares available for issuance under the 2018 ESPP to 524,775 shares. For the year ended December 31, 2021 the Company issued a total of 15,667 shares under the 2018 ESPP. Expense related to the issuance of such shares was less than $ 0.1 million. No shares were issued under the 2018 ESPP during the year ended December 31, 2020. Stock Options A summary of stock option activity is set forth below (in thousands, except share and per share data): Outstanding Awards Number of Weighted Weighted Aggregate Outstanding, December 31, 2020 3,706,945 $ 10.90 7.98 $ 15,126 Options authorized — Options granted 2,161,472 $ 14.37 Options exercised ( 1,125,339 ) $ 4.17 Options forfeited or cancelled ( 867,761 ) $ 14.06 Outstanding, December 31, 2021 3,875,317 $ 14.08 8.85 $ 13,212 Options exercisable December 31, 2021 991,847 $ 13.42 8.46 $ 4,033 Vested and expected to vest, December 31, 2021 3,875,317 $ 14.08 8.85 $ 13,212 The fair value of each stock option was estimated at the date of grant using a Black-Scholes option-pricing model using the following assumptions: Year Ended December 31, 2021 2020 Expected volatility 77.2 % - 79.8 % 72.6 % - 96.3 % Risk-free interest rate 0.1 % - 1.4 % 0.1 % - 1.7 % Dividend yield — — Expected term 0.90 - 6.08 years 1.00 - 6.08 years The assumptions are as follows: • Expected volatility. The Company has limited trading history. As such, the expected volatility was determined by examining the historical volatilities for comparable publicly traded companies within the biotechnology and pharmaceutical industry using an average of historical volatilities of the Company’s industry peers. • Risk-free interest rate. The risk-free interest rate is based on the United States Treasury yield with a maturity equal to the expected term of the option in effect at the time of grant. • Dividend yield. The expected dividend is assumed to be zero as dividends have never been paid and there are no current plans to pay dividends on common stock. • Expected term. The expected term represents the period that the stock-based awards are expected to be outstanding. The expected term is calculated using the simplified method which is used when there is insufficient historical data about exercise patterns and post-vesting employment termination behavior. The simplified method is based on the vesting period and the contractual term for each grant, or for each vesting-tranche for awards with graded vesting. The mid-point between the vesting date and the maximum contractual expiration date is used as the expected term under this method. For awards with multiple vesting-tranches, the times from grant until the mid-points for each of the tranches may be averaged to provide an overall expected term. The Company will continue to use judgment in evaluating the expected volatility, risk-free interest rates, dividend yield and expected term, utilized for stock-based compensation on a prospective basis. The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying stock options and the fair value of the Company’s common stock for stock options that were in-the-money at December 31, 2021 and 2020. The aggregate intrinsic value of stock options exercised during the years ended on December 31, 2021 and 2020 was $ 10.1 million and $ 2.5 million, respectively. The total fair value of options that vested during the years ended December 31, 2021 and 2020 was $ 2.3 million and $ 2.4 million, respectively. The options granted during the years ended December 31, 2021 and 2020 had a weighted-average per share grant-date fair value of $ 9.68 per share and $9 .96 per share, respectively. As of December 31, 2021, the total unrecognized stock-based compensation expense related to unvested stock options was $ 24.8 million, which is expected to be recognized over the remaining weighted-average vesting period of 2.8 years. Restricted Stock Units The following table presents a summary of the Company's RSU activity and related information: Number of Units Outstanding Weighted- Outstanding, December 31, 2020 — RSUs granted (including performance-based RSUs) 777,160 $ 7.84 RSUs Vested — RSUs forfeited ( 5,500 ) $ 7.12 Outstanding, December 31, 2021 771,660 $ 7.85 In May 2021, the Company granted 6,410 RSUs with service and performance conditions to an employee, none of which vested during the year ending December 31, 2021. Vesting of these awards is contingent on the occurrence of certain milestone events and fulfilment of any remaining service condition. As a result, the related compensation cost is recognized as an expense when achievement of the milestone is considered probable. The expense recognized for these awards is based on the grant date fair value of the Company's common stock multiplied by the number of units granted. The Company recognized less than $ 0.1 million of related expense during the year ended December 31, 2021. In October 2021, the Company granted 560,000 RSUs with service and performance conditions to certain employees, none of which vested during the year ended December 31, 2021. Vesting of these awards is contingent on the occurrence of certain milestone events and fulfilment of any remaining service condition. As a result, the related compensation cost is recognized as an expense when achievement of the milestone is considered probable. The expense recognized for these awards is based on the grant date fair value of the Company's common stock multiplied by the number of units granted. The Company recognized $ 1.6 million of related expense during the year ended December 31, 2021. The weighted-average grant date fair value of RSUs granted during the year ended December 31, 2021 was $ 7.84 . There was no RSU activity during the year ended December 31, 2020. Additionally, no RSUs vested during the year ended December 31, 2021. As of December 31, 2021, there was approximately $ 4.1 million of unrecognized compensation cost related to unvested RSUs that the Company expects to recognize over a remaining weighted-average period of approximately 1.3 years. The following table presents stock-based compensation expense by type of award (in thousands): Year Ended December 31, 2021 2020 Stock Options 10,511 5,263 Restricted stock units (including performance-based RSUs) 1,944 — Employee Stock Purchase Plan 56 — Total $ 12,511 $ 5,263 |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | 16. Net Loss Per Share The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share data): Year Ended December 31, 2021 2020 Numerator: Net loss attributable to common stockholders $ ( 61,999 ) $ ( 36,678 ) Denominator: Weighted-average shares used in computing net loss 30,952,152 7,319,977 Net loss per share attributable to common stockholders, $ ( 2.00 ) $ ( 5.01 ) The Company's potentially dilutive shares, which include outstanding stock options, unvested RSUs, and unexercised warrants to purchase common stock, are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net loss per share attributable to common stockholders for the period presented because including them would have been antidilutive: December 31, 2021 2020 Options to purchase common stock 3,875,317 3,706,945 Unvested Restricted Stock Awards 771,660 — Common stock warrants 220,890 226,191 Total 4,867,867 3,933,136 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 17. Income Taxes The components of the provision for (benefit from) income taxes are as follows (in thousands): Years Ended December 31, 2021 2020 Current: Federal $ — $ ( 2,678 ) State — 105 Foreign — — Total current — ( 2,573 ) Deferred: Federal ( 125 ) ( 242 ) State — — Foreign — — Total deferred ( 125 ) ( 242 ) Provision for (benefit from) income taxes $ ( 125 ) $ ( 2,815 ) Income tax benefit of $ 0.1 million for the year ended December 31, 2021 is primarily due to the adjustment in deferred tax liability arising from the impairment charge of $ 1.2 million of acquired IPR&D. In contrast, the income tax benefit of $ 2.8 million for the year ended December 31, 2020 was primarily due to a the recognition of a net operating loss carryback under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) which was enacted on March 27, 2020 in response to the COVID-19 pandemic. For the rate table below the (provision for) benefit from income taxes differ from the amount expected by applying the federal statutory rate to the loss before taxes as follows: Year Ended December 31, 2021 2020 Federal statutory income tax rate 21.0 % 21.0 % Other permanent differences ( 1.9 )% ( 0.5 )% State income taxes 6.9 % 6.1 % Federal benefit from NOL carryback 0.0 % 6.7 % Change in valuation allowance ( 24.8 )% ( 25.8 )% Change in fair value of redeemable convertible preferred stock tranche liability and TRDF liability 0.0 % ( 0.5 )% Stock-based compensation ( 1.0 )% 0.1 % Provision for income taxes 0.2 % 7.1 % The tax effects of temporary differences and carryforwards of the deferred tax assets are presented below (in thousands): December 31, 2021 2020 Deferred Tax Assets: Net operating loss carryforwards $ 67,675 $ 51,796 Operating lease right-of-use asset liability 5,504 5,686 Deferred revenue 1,263 2,857 Stock-based compensation 1,726 1,750 Intangible assets 1,081 1,195 Fixed assets 196 — Accruals and reserves 1,042 654 Research and development credit carryforwards 26 26 Gross deferred tax assets 78,513 63,964 Less: Valuation allowance ( 73,163 ) ( 57,715 ) Deferred tax assets, net of valuation allowance 5,350 6,249 Deferred tax liabilities: Fixed assets — — Basis Difference IPR&D — ( 313 ) Operating lease right-of-use asset ( 5,350 ) ( 6,061 ) Net deferred tax assets $ — $ ( 125 ) On September 15, 2020 Adicet Bio and resTORbio completed the Merger upon which Adicet Bio became the parent company of the consolidated group. The Merger did not create a step up in basis for tax basis of the asset as it was considered a tax-free merger. The above deferred tax table includes deferred related to resTORbio. The Company has established a valuation allowance against its deferred tax assets due to the uncertainty surrounding the realization of such assets. ASC 740 requires that the tax benefit of net operating losses, temporary differences and credit carryforwards be recorded as an asset to the extent that management assesses that realization is “more likely than not.” Realization of the future tax benefits is dependent on the Company’s ability to generate sufficient taxable income within the carryforward period. Because of the Company’s recent history of operating losses, management believes that recognition of the deferred tax assets arising from the above-mentioned future tax benefits is currently not likely to be realized and, accordingly, has provided a valuation allowance. The valuation allowance increased by $ 15.5 million during 2021 and $ 37.9 million during 2020. As of December 31, 2021, the Company had net operating loss carryforwards of $ 271.6 million, $ 143.5 million, and $ 17.1 million to reduce future taxable income, if any, for federal, state and foreign income tax purposes, respectively. Of the federal net operating loss carryforwards, $ 7.6 million will begin to expire in 2036 if not utilized, and $ 264.0 million can be carried forward indefinitely. The state carryforwards will begin to expire in 2035. The Company also had approximately $ 1.8 million of federal and $ 1.5 million of California research and development tax credit carryforwards available to offset future taxable income as of December 31, 2021. The federal credits begin to expire in 2041 and the California research credits can be carried forward indefinitely. Utilization of the net operating loss carryforwards and research and development tax credit carryforwards may be subject to an annual limitation under Section 382 of the Internal Revenue Code of 1986, and corresponding provisions of state law, due to ownership changes that have occurred previously or that could occur in the future. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50% over a three-year period . The Company has not conducted a study to assess whether a change of control has occurred or whether there have been multiple changes of control since inception due to the significant complexity and cost associated with such a study. If the Company has experienced a change of control, as defined by Section 382, at any time since inception, utilization of the net operating loss carryforwards or research and development tax credit carryforwards would be subject to an annual limitation under Section 382, which is determined by first multiplying the value of the Company’s stock at the time of the ownership change by the applicable long-term tax-exempt rate, and then could be subject to additional adjustments, as required. Any limitation may result in expiration of a portion of the net operating loss carryforwards or research and development tax credit carryforwards before utilization. Further, until a study is completed and any limitation is known, no liability related to uncertain tax positions is recorded in the consolidated financial statements. The Company does not expect its unrecognized tax benefit balance to change materially over the next 12 months. The Company files income tax returns in the United States federal jurisdiction, California, Massachusetts, New York and Israel. The tax years 2015 to 2021 remains open to United States federal and state examination to the extent of the utilization of net operating loss and credit carryovers. As of December 31, 2021, the Company had unrecognized tax benefits of $ 0.8 million related to the transfer of certain intellectual property from its Israeli subsidiary. In addition, as of December 31, 2021, the Company had unrecognized tax benefits of $ 3.2 million related to the federal and state research and development credits as a result of no formal research credit study performed. A reconciliation of the beginning and ending unrecognized tax benefit amount is as follows (in thousands): Year Ended December 31, 2021 2020 Balance at the beginning of the year $ 797 $ 797 Adjustment based on tax positions related to current year 3,243 — Balance at the end of the year $ 4,040 $ 797 The Company recognizes interest expense and penalties related to the above unrecognized tax benefits within income tax expense (benefit). Management determined that no accrual for interest and penalties was required as of December 31, 2021. |
Defined Contribution Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2021 | |
Defined Contribution Plan [Abstract] | |
Defined Contribution Plan | 18. Defined Contribution Plan The Company maintains a defined contribution plan under Section 401(k) of the Internal Revenue Code covering substantially all full-time United States employees. Employee contributions are voluntary and are determined on an individual basis subject to the maximum allowable under federal tax regulations. During the year ended December 31, 2021 the Company made aggregate matching contributions of $ 0.3 million. The Company did no t make contributions to the 401(k) plan during 2020. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 19. Related Party Transactions As of December 31, 2021, Regeneron owned 883,568 shares of the Company's common stock. Regeneron became a related party in July 2019 as a result of Series B redeemable convertible preferred stock financing. Upon closing the Merger, 7,125,552 shares of the redeemable convertible preferred stock converted into 883,568 shares of the Company’s common stock. For the years ended December 31, 2021 and 2020, the Company recorded revenue related to the Regeneron Agreement of $ 9.7 million and $ 17.9 million, respectively. As of December 31, 2021, the Company recorded less than $ 0.2 million in accounts receivable and has deferred revenue of $ 4.8 million related to the Regeneron Agreement (See Note 10). |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | 20. Subsequent Events Regeneron Option On January 28, 2022, Regeneron exercised its option to license the exclusive, worldwide rights to ADI-002, an allogeneic gamma delta chimeric antigen receptor (CAR) T cell therapy directed against Glypican-3, pursuant to the Regeneron Agreement. 20.0 million to the Company on January 28, 2022. Pursuant to the Regeneron Agreement, upon Regeneron’s exercise of the option, the Company had a specified period of time to elect to co-fund ADI-002’s future development costs, and to participate in any potential profits with Regeneron up to a specified co-funding percentage in various geographic regions, including on a worldwide basis (Co-Funding Option). Adicet elected not to exercise its Co-Funding Option for ADI-002. Accordingly, Regeneron is responsible, at its sole cost, for all development, manufacturing and commercialization of ADI-002 and must pay the Company high single digit royalties as a percentage of any net sales of ADI-002 for a period commencing on the first commercial sale until the longer of (i) the expiration or invalidity of the licensed patent rights or (ii) a low double digit amount of years from first commercial sale. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements and related disclosures have been prepared in conformity with accounting principles generally accepted in the United States of America (United States GAAP or GAAP). |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The United States dollar is the functional and reporting currency of the Company and its subsidiaries. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities at the date of the consolidated financial statements as well as the reported amounts of revenues and expenses during the reporting period. Such estimates include the valuation of the intangible assets acquired in business combinations, redeemable convertible preferred stock warrant liability, redeemable convertible preferred stock tranche liability, the Technion Research and Development Foundation liability (TRDF Liability), contingent consideration liability for contingent value right (CVR), deferred tax assets, useful lives of property and equipment, accruals for research and development activities, revenue recognition and stock-based compensation and the Company’s incremental borrowing rate. Actual results could differ from those estimates. |
Contingent Consideration Liability (CVR) | Contingent Consideration Liability (CVR) The estimated fair value of the CVR, initially measured and recorded on the acquisition date, is considered to be a Level 3 instrument. The contingent consideration liability is recorded at fair value at the end of each reporting period with changes in estimated fair values recorded in research and development expenses in the consolidated statements of operations and comprehensive loss. During the second quarter of 2021, the Company performed a re-measurement of the fair value of the CVR liability and adjusted the liability to zero. This resulted in a $ 1.0 million gain in research and development expense in the statements of operations and comprehensive loss for the year ended December 31, 2021. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of net tangible and identified intangible assets acquired in a business combination. Goodwill is not amortized but is evaluated at least annually for impairment or when a change in facts and circumstances indicate that the fair value of the goodwill may be below the carrying value. Goodwill is tested for impairment at the reporting unit level annually in the fourth quarter, or more frequently when events or changes in circumstances indicate that the asset might be impaired. Examples of such events or circumstances include, but are not limited to, a significant adverse change in legal or business climate, an adverse regulatory action or unanticipated competition. The Company has determined that it operates in a single operating segment and has a single reporting unit. Prior to performing the impairment test, the Company assesses qualitative factors to determine whether the existence of events or circumstances would indicate that it is more likely than not that the fair value of the reporting unit was less than the carrying amount. If after assessing the totality of events or circumstances, the Company were to determine that it is more likely than not that the fair value of the reporting unit is less than the carrying amount, then the Company would perform a quantitative impairment test. The quantitative impairment test involves comparing the fair value of the reporting unit to the carrying value. If the fair value of the reporting unit exceeds the carrying value of the net assets, goodwill is not impaired, and no further testing is required. If the fair value of the reporting unit is less than the carrying value, the Company measures the amount of impairment loss, if any, as the excess of the carrying value over the fair value of the reporting unit. The Company performed an annual test for goodwill impairment in the fourth quarter of the fiscal year ended December 31, 2021 and determined that goodwill was no t impaired. |
Intangible Assets | Intangible Assets In connection with the Merger, the Company acquired certain IPR&D assets, which were classified as indefinite-lived intangible assets. Acquired IPR&D represents the fair value assigned to research and development assets that the Company acquires and have not been completed at the acquisition date. The fair value of IPR&D acquired in a business combination is recorded on the Company’s consolidated balance sheets at the acquisition-date fair value and is determined by estimating the costs to develop the technology into commercially viable products, estimating the resulting revenue from the products, and discounting the projected net cash flows to present value. IPR&D is not amortized, but rather is reviewed for impairment on an annual basis or more frequently if indicators of impairment are present, until the project is completed, abandoned, or transferred to a third party. The Company performed a review for impairment of IPR&D during the second quarter of the year ended December 31, 2021 and recognized an impairment charge of $ 1.2 million, which was recorded as research and development expenses in the consolidated statement of operations and comprehensive loss. |
Segments | Segments The Company operates and manages its business as one reportable and operating segment, which is the business of research and development of allogeneic immunotherapies for cancer and other diseases. The Company’s Chief Executive Officer, who is the chief operating decision maker, reviews financial information on an aggregate basis for purposes of allocating resources and evaluating financial performance. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of cash and cash equivalents, and marketable debt securities. The Company’s cash and cash equivalents are held at two financial institutions in the United States and one financial institution in Israel and such amounts may, at times, exceed insured limits. The Company invests its cash equivalents and marketable debt securities in money market funds, United States government securities, commercial paper, corporate bonds, and asset-backed securities. The Company limits its credit risk associated with cash equivalents and marketable debt securities by placing them with banks and institutions it believes are highly creditworthy and in highly rated investments. The Company has not experienced any losses on its deposits of cash and cash equivalents and marketable debt securities to date. The Company has one customer, Regeneron, which represents 100 % of the Company’s total revenue during the years ended December 31, 2021 and 2020 and outstanding accounts receivable as of December 31, 2021 (see Note 10). |
Risks and Uncertainties | Risks and Uncertainties The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, protection of proprietary technology, dependence on key personnel, compliance with government regulations and the need to obtain additional financing to fund operations. Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical studies, clinical trials, and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel infrastructure and extensive compliance and reporting. The Company’s product candidates are still in development and, to date, none of the Company’s product candidates have been approved for sale and, therefore, the Company has not generated any revenue from product sales. There can be no assurance that the Company’s research and development will be successfully completed, that adequate protection for the Company’s intellectual property will be obtained or maintained, that any products developed will obtain necessary government regulatory approval or that any approved products will be commercially viable. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will generate revenue from product sales. The Company operates in an environment of rapid change in technology and substantial competition from other pharmaceutical and biotechnology companies. The current COVID-19 (coronavirus) pandemic, which is impacting worldwide economic activity, poses risk that the Company or its employees, contractors, suppliers, and other partners may be prevented from conducting business activities for an indefinite period of time, including due to shutdowns that may be requested or mandated by governmental authorities. The extent to which the coronavirus impacts the Company’s operations will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the outbreak, new information that will emerge concerning the severity of the coronavirus and the actions to contain the coronavirus or treat its impact, among others. COVID-19 may impact the timing of regulatory approval of the INDs for clinical trials, the enrollment of any clinical trials that are approved, the availability of clinical trial materials and regulatory approval and commercialization of our products. COVID-19 may also impact the Company’s ability to access capital, which could negatively impact short-term and long-term liquidity. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with maturities of three months or less from the purchase date to be cash equivalents. As of December 31, 2021 and 2020, cash and cash equivalents consist of cash deposited with banks and investments in money market funds with maturities of three months or less from the date of purchase. |
Marketable Securities | Marketable Debt Securities Marketable debt securities are investments in marketable debt securities with maturities greater than three months at the time of purchase. The Company determines the appropriate classification of its investments in marketable debt securities at the time of purchase and reevaluates such designation at each balance sheet date. The Company has classified and accounted for its marketable debt securities as available-for-sale. The Company classifies highly liquid securities with maturities beyond 12 months as long-term marketable debt securities in the consolidated balance sheet. These securities are carried at fair value as determined based upon quoted market prices or pricing models for similar securities. Unrealized gains and losses, if any, are excluded from earnings and are reported as a component of accumulated other comprehensive income (loss). The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest income on the consolidated statements of operations and comprehensive loss. Realized gains and losses, if any, on available-for-sale securities are included in other income (expense), net. The cost of securities sold is based on the specific identification method. Interest and dividends on securities classified as available-for-sale are included in interest income. The Company did not have any outstanding marketable debt securities as of December 31, 2021 and did not identify any of its marketable debt securities as other-than-temporarily impaired as of December 31, 2020. |
Restricted Cash | Restricted Cash Restricted cash is comprised of cash that is restricted as to withdrawal or use under the terms of certain contractual agreements. Restricted cash for years ended December 31, 2021 and 2020 consists of collateral for letters of credit issued in connection with real estate leases (see Note 12). |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of certain financial instruments of the Company, including cash equivalents, restricted cash, accounts payable and accrued and other current liabilities approximate fair value due to their relatively short maturities. The Company’s marketable debt securities and CVR liability are carried at fair value (see Notes 4 and 5). |
Property and Equipment, Net | Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed on a straight-line basis over the estimated useful lives of the related assets, generally three years. Leasehold improvements are amortized using the straight-line method over the shorter of the assets’ estimated useful lives or the remaining term of the lease. Maintenance and repairs are charged to operations as incurred. When assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the consolidated balance sheet and any resulting gain or loss is reflected in the consolidated statements of operations and comprehensive loss in the period realized. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Recoverability is measured by comparison of the carrying amount of the asset or asset group to the future net cash flows which the asset or asset group is expected to generate. If such asset or asset group is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset or asset group exceeds the fair value of the asset or asset group. There has been no such impairment of long-lived assets during the years ended December 31, 2021 and 2020. |
Revenue Recognition | Revenue Recognition Under ASC 606, Revenue from Contracts with Customers (ASC 606), the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps as prescribed by ASC 606: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. A contract with a customer exists when (i) the Company enters into a legally enforceable contract with a customer that defines each party’s rights regarding the products or services to be transferred and identifies the payment terms related to these products or services, (ii) the contract has commercial substance and (iii) the Company determines that collection of substantially all consideration for products or services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company identifies the goods or services promised and determines the performance obligations by assessing whether each promised good or service is distinct. Goods or services that are not distinct are bundled with other goods or services in the contract until a bundle of goods or services that is distinct is created. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. All of the Company’s revenues are derived through a license and collaboration agreement (see Note 10). For revenue recognition purposes, the Company determines the term of its license or collaboration agreements by evaluating the period during which present and enforceable rights and obligations exist. This determination is impacted by the existence of substantive termination penalties, among other factors. The Company recognizes revenue under the Company’s license or collaboration agreements that are within the scope of ASC 606. These agreements include promises related to licenses to intellectual property and research and development services. If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenue from non-refundable, up-front fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgement to assess the nature of the combined performance obligation to determine whether the combined 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 from non-refundable, up-front fees. Accordingly, the transaction price is generally comprised of a fixed fee due at contract inception and at specified future dates, variable consideration in the form of milestone payments due upon the achievement of specified events and tiered royalties earned when customers recognize net sales of licensed products. The Company measures the transaction price based on the amount of consideration to which it expects to be entitled in exchange for transferring the promised goods and/or services to the customer. The Company utilizes the “most likely amount” method to estimate the amount of variable consideration to which it will be entitled for the contract. Amounts of variable consideration are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. At the inception of each arrangement that includes development and regulatory milestone payments, the Company evaluates whether the associated event is considered most likely to be achieved and estimates the amount to be included in the transaction price. Payments or reimbursements for the Company’s research and development efforts where such efforts are considered part of or a single performance obligation are recognized over time using a measure of progress that best reflects the Company’s performance in satisfying the obligation. Upfront payments are recorded as contract liabilities upon receipt or when due and may require deferral of revenue recognition to a future period until the Company performs its obligation under these arrangements. Amounts payable to the Company are recorded as accounts receivable when the Company’s right to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less. For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized any royalty revenue resulting from its collaboration arrangement. |
Research and Development Expenses | Research and Development Expenses Research and development expenses include costs directly attributable to the conduct of research and development programs, including payroll and related expenses, costs for CMOs, costs for CROs, materials, supplies, depreciation on and maintenance of research equipment, consulting costs, and the allocated portions of facility costs, such as rent, utilities, insurance, repairs and maintenance, depreciation, information technology costs and general support services. All costs associated with research and development are expensed within the consolidated statements of operations and comprehensive loss as incurred. Costs incurred in obtaining technology licenses are charged to research and development expense as acquired in-process research and development if the technology licensed has not reached technological feasibility and has no alternative future use. |
Accrued CRO, CMO, and Research and Development Expenses | Accrued CRO, CMO, and Research and Development Expenses The Company has entered into various agreements with CMOs and CROs. The Company’s research and development accruals are estimated based on the level of services performed, progress of the studies, including the phase or completion of events, and contracted costs. The estimated costs of research and development provided, but not yet invoiced are included in accrued and other current liabilities on the consolidated balance sheets. If the actual timing of the performance of services or the level of effort varies from the original estimates, the Company will adjust the accrual accordingly. Payments made to CMOs and CROs under these arrangements in advance of the performance of the related services are recorded as prepaid expenses and other current assets on the consolidated balance sheets until the services are rendered. Through December 31, 2021 there had been no material adjustments to the Company’s prior period estimates of accrued research and development expenses. |
Leases | Leases Effective January 1, 2020, the Company adopted ASU No. 2016-02, Leases (Topic 842) (ASU 2016-02), using the modified retrospective approach through a cumulative-effect adjustment as of the adoption date, with prior periods unchanged and presented in accordance with the guidance in Topic 840, Leases (Topic 840). Consistent with ASU 2016-02, the Company determines if an arrangement is a lease, or contains a lease, at inception. Leases with a term greater than 12 months are recognized on the balance sheet as Right-of-Use (ROU) assets and current and long-term operating lease liabilities, as applicable. The Company has elected not to recognize on the balance sheet leases with terms of 12 months or less. The Company typically only includes an initial lease term in its assessment of a lease arrangement. Options to renew a lease are not included in the Company’s assessment unless there is reasonable certainty that the Company will renew. The Company monitors its plan to renew its leases no less than on a quarterly basis. In addition, the Company’s lease agreements generally do not contain any residual value guarantees or restrictive covenants. In accordance with ASU 2016-02, the ROU assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate (IBR), which is the estimated rate the Company would be required to pay for a fully collateralized borrowing equal to the total lease payments over the term of the lease, to determine the present value of future minimum lease payments. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. For lease agreements entered into or reassessed after the adoption of ASU 2016-02, the Company does not combine lease and non-lease components. Variable lease payments are expenses as incurred. Assumptions made by the Company at the commencement date are re-evaluated upon occurrence of certain events, including a lease modification. A lease modification results in a separate contract when the modification grants the lessee an additional right of use not included in the original lease and when lease payments increase commensurate with the standalone price for the additional right of use. When a lease modification results in a separate contract, it is accounted for in the same manner as a new lease. |
Fair Value of Common Stock | Fair Value of Common Stock Prior to the Merger the fair value of the Company’s common stock was determined by its Board of Directors with input from management and third-party valuation specialists. The Company’s approach to estimate the fair value of the Company’s common stock is consistent with the methods outlined in the American Institute of Certified Public Accountants Practice Aid, Valuation of Privately-Held- Company Equity Securities Issued as Compensation . Determining the best estimated fair value of the Company’s common stock requires significant judgement and management considers several factors, including the Company’s stage of development, equity market conditions affecting comparable public companies, significant milestones and progress of research and development efforts. Subsequent to the Merger, the fair value of the Company’s common stock is determined based on its closing market price. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation arrangements with employees and non-employees using a fair value method which requires the recognition of compensation expense for costs related to all stock-based payments including stock options. The fair value method requires the Company to estimate the fair value of stock-based payment awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option-pricing model to estimate the fair value of options granted that are expensed on a straight-line basis over the requisite service period, which is generally the vesting period. The Company accounts for forfeitures as they occur. Option valuation models, including the Black-Scholes option-pricing model, require the input of several assumptions. Changes in the assumptions used can materially affect the grant-date fair value of an award. These assumptions include the risk-free rate of interest, expected dividend yield, expected volatility and the expected life of the award. For awards that have a performance condition, the Company recognizes compensation expense based on its assessment of the probability that the performance condition will be achieved, using an accelerated attribution model, over the explicit or implicit service period. |
Income Taxes | Income Taxes The Company accounts for income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences attributable to differences between carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting purposes and for operating loss and tax credit carryforwards. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. The Company’s deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which these temporary differences are expected to be recovered or settled. A valuation allowance is recorded to reduce deferred tax assets if it is determined that it is more likely than not that all or a portion of the deferred tax asset will not be realized. The Company considers many factors when assessing the likelihood of future realization of deferred tax assets, including recent earnings results, expectations of future taxable income, carryforward periods available and other relevant factors. The Company records changes in the required valuation allowance in the period that the determination is made. The Company assesses its income tax positions and records tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances and information available as of the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, the Company records the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority having full knowledge of all relevant information. For those income tax positions where it is not more likely than not that a tax benefit will be sustained, the Company does not recognize a tax benefit in the consolidated financial statements. The Company records interest and penalties related to uncertain tax positions, if applicable, as a component of income tax expense (benefit). |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) is defined as a change in equity of a business enterprise during a period, resulting from transactions from non-owner sources. The other comprehensive loss disclosed in the Company’s consolidated statements of operations and comprehensive loss for the years ended December 31, 2021 and 2020 consists of changes in unrealized gains and losses on marketable debt securities. |
Net Loss per Share Attributable to Common Stockholders | Net Loss per Share Attributable to Common Stockholders Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common stock outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common stock and potentially dilutive securities outstanding for the period. The Company’s potentially dilutive shares, which include outstanding stock options, Employee Stock Purchase Plan awards, unvested restricted stock units (RSUs), and shares issuable upon conversion of the Convertible Notes, are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. Basic and diluted net loss per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. The two-class method determines net income (loss) per share for each class of common and participating securities according to dividends declared or accumulated and participation rights in undistributed earnings. The two-class method requires income (loss) available to common stockholders for the period to be allocated between common and participating securities based upon their respective rights to share in undistributed earnings as if all income (loss) for the period had been distributed. The Company’s participating securities do not have a contractual obligation to share in the Company’s losses. As such, the net loss is attributed entirely to common stockholders. Since the Company has reported a net loss for all periods presented, diluted net loss per common share is the same as basic net loss per common share for those periods. |
Subsequent Events Considerations | Subsequent Events Considerations The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the consolidated financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. The Company has evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure, other than as disclosed in these notes to the consolidated financial statements. See Note 21 for further information. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB under its ASC or other standard setting bodies and adopted by the Company as of the specified effective date, unless otherwise discussed below. Recently Adopted Accounting Pronouncements In August 2018, the FASB issued ASU No. 2018-15, Intangibles–Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract (ASU 2018-15). The amendments in ASU 2018-15 align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). Accordingly, the update requires entities in a hosting arrangement that is a service contract to follow the guidance in ASC 350-40, Internal-Use Software (ASC 350-40) to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. Costs to develop or obtain internal-use software that cannot be capitalized under ASC 350-40, such as training costs and certain data conversion costs, also cannot be capitalized for a hosting arrangement that is a service contract. Therefore, an entity in a hosting arrangement that is a service contract determines which project stage an implementation activity relates to. Costs for implementation activities in the application development stage are capitalized depending on the nature of the costs, while costs incurred during the preliminary project and post-implementation stages are expensed as the activities are performed. ASU 2018-15 also requires entities to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. ASU 2018-15 was effective for public entities for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. For nonpublic entities, ASU 2018-15 is effective for annual reporting periods beginning after December 15, 2020, and interim periods within annual periods beginning after December 15, 2021. Early adoption is permitted, including adoption in any interim period. The Company adopted ASU 2018-15 beginning January 1, 2021. The adoption of ASU 2018-15 resulted in an immaterial amount of assets recorded on the Company's balance sheet. In November 2018, the FASB issued ASU No. 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction Between Topic 808 and Topic 606 (ASU 2018-18), which is intended to clarify the circumstances under which certain transactions in collaborative arrangements should be accounted for under the revenue recognition standard. Certain transactions between collaboration arrangement participants should be accounted for as revenue under ASC Topic 606 when the collaborative arrangement participant is a customer in the context of a unit of account. For public business entities, this ASU is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. For all other entities, this ASU is effective for fiscal years and interim periods within those years beginning after December 15, 2020. Early adoption is permitted. The Company adopted ASU 2018-18 beginning January 1, 2021. The adoption of this standard did not have a material impact on the Company's financial statements and related disclosures. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740)—Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplify various aspects related to the accounting for income taxes. This ASU removes exceptions to the general principles in Topic 740 related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. For public companies, this ASU is effective for interim and annual reporting periods beginning after December 15, 2020. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. Early adoption is permitted. The Company adopted ASU 2019-12 beginning January 1, 2021 on a prospective basis. The adoption of this standard did not have a material impact on the Company's financial statements and related disclosures In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848) (ASU 2020-04). The amendments in ASU 2020-04 provide optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in ASU 2020-04 are effective for all entities as of March 12, 2020 through December 31, 2022. An entity may elect to apply the amendments for contract modifications by Topic or Industry Subtopic as of any date from the beginning an interim period that includes or is subsequent to March 12, 2020, or prospectively from the date that the financial statements are available to be issued. Once elected for a Topic or an Industry Subtopic, the amendments must be applied prospectively for all eligible contract modifications for that Topic or Industry Subtopic. The Company may elect to apply ASU 2020-04 as its contracts referenced in London Interbank Offered Rate (LIBOR) are impacted by reference rate reform. The Company adopted ASU 2020-04 beginning January 1, 2021. The adoption of this standard did not have a material impact on the Company's financial statements and related disclosures. Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. This ASU replaces the existing incurred loss impairment model with an expected loss model. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. For public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, adoption is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For SEC filers that are eligible to be smaller reporting companies and for all other entities, this ASU is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (ASU 2017-04). The new guidance simplifies the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment requires an entity to perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The new guidance for accelerated filing companies became effective for annual periods or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019 and all other entities should adopt the amendments in this update for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2022. The amendment should be applied on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statements and related disclosures. In July 2021, FASB issued ASU No. 2021-05, Lease (Topic 842), Lessors - Certain Leases with Variable Lease Payments (ASU 2021-05). ASU 2021-05 amends the lease classification requirements for lessors when classifying and accounting for a lease with variable lease payments that do not depend on a reference rate index or a rate. The update provides criteria, that if met, the lease would be classified and accounted for as an operating lease. ASU 2021-05 is effective for reporting periods beginning after December 15, 2021, with early adoption permitted. The Company is currently evaluating the impact of the adoption of this ASU on the Company's consolidated financial statements, but does not believe the adoption of this standard will have a material impact on the Company's consolidated financial statements. |
Business Combination (Tables)
Business Combination (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Schedule of Summarizes the Purchase Price in the Merger | The following summarizes the purchase price in the Merger (in thousands, except share and per share amounts): Fair value of common stock shares of the combined company $ 84,142 Fair value of contingent consideration liability with respect to CVR (2) 2,880 Purchase price $ 87,022 |
Schedule of Estimated Share Consideration of Combined Company | (1) Represents the share consideration of the combined company that the resTORbio stockholders own as of the closing of the Merger calculated as follows: Number of shares of the combined company owned by resTORbio 5,207,695 Multiplied by the fair value per share of resTORbio common $ 16.59 Acquisition date fair value of resTORbio 86,396 Estimated fair value of modified stock options and restricted stock units attributable to pre-combination services (3) 626 Less: portion of the fair value to be distributed as CVR (c) ( 2,880 ) Fair value of shares of the combined company owned by resTORbio $ 84,142 |
Schedule of Summarizes the Allocation of the Purchase Price to the Net Tangible and Intangible Assets Acquired | The following summarizes the allocation of the purchase price to the net tangible and intangible assets acquired (in thousands): As of Measurement Period Adjustments Final Purchase Net assets acquired: Cash and cash equivalents $ 63,869 $ — $ 63,869 Prepaid expenses and other current assets 3,059 615 3,674 Property and equipment 318 — 318 IPR&D 3,490 — 3,490 Restricted cash 245 — 245 Accounts payable ( 1,316 ) 12 ( 1,304 ) Accrued and other current liabilities ( 2,365 ) — ( 2,365 ) Other liabilities — — — Deferred tax liability ( 367 ) — ( 367 ) Goodwill 20,089 ( 627 ) 19,462 Purchase price $ 87,022 $ — $ 87,022 |
Schedule of changes in the Company's IPR&D and CVR since the Merger | The following tables present changes in the Company's IPR&D and CVR since the Merger (in thousands): Acquisition Date Change in As of Change in As of In-process research and development $ 3,490 $ ( 2,300 ) $ 1,190 $ ( 1,190 ) $ — Contingent Value Rights $ 2,880 $ ( 1,900 ) $ 980 $ ( 980 ) $ — |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured on Recurring Basis | The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values (in thousands): December 31, 2021 Level 1 Level 2 Level 3 Total Assets: Money market funds (1) $ 147,071 $ — $ — $ 147,071 Total fair value of assets $ 147,071 $ — $ — $ 147,071 December 31, 2020 Level 1 Level 2 Level 3 Total Assets: Money market funds (1) $ 63,817 $ — $ — $ 63,817 Marketable debt securities (2) Asset-backed securities — 7,522 — 7,522 Corporate debt securities — 1,762 — 1,762 Commercial paper — 1,000 — 1,000 Marketable debt securities — 10,284 — 10,284 Total fair value of assets $ 63,817 $ 10,284 $ — $ 74,101 Liabilities: Contingent consideration $ — $ — $ 980 $ 980 Total fair value of liabilities $ — $ — $ 980 $ 980 (1) Included in cash and cash equivalents in the consolidated balance sheets (2) Included in short-term marketable debt securities in the consolidated balance sheets. |
Marketable Debt Securities (Tab
Marketable Debt Securities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Marketable Debt Securities | The following tables summarize the Company’s marketable debt securities (in thousands): December 31, 2020 Amortized Unrealized Unrealized Fair Asset-backed securities $ 7,507 $ — $ 15 $ 7,522 Corporate debt securities 1,754 — 8 1,762 Commercial paper 999 — 1 1,000 Total $ 10,260 $ — $ 24 $ 10,284 |
Summary of Classification of Marketable Debt Securities in Consolidated Balance Sheets | The following table summarizes the classification of the Company’s marketable debt securities in the consolidated balance sheets (in thousands): December 31, 2021 2020 Short-term marketable debt securities $ — $ 10,284 Long-term marketable debt securities — — Total $ — $ 10,284 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Summary of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following (in thousands): December 31, 2021 2020 Prepaid Insurance $ 1,884 $ 1,443 Prepayments to CRO's 1,658 420 Prepaid Maintenance 1,021 761 Prepayments to CMO's 115 135 Other current assets 2 229 Tax receivable — 2,711 Interest receivable 29 23 Total $ 4,709 $ 5,722 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment, Net | Property and equipment, net consisted of the following (in thousands): As of December 31, Useful life (years) 2021 2020 Laboratory equipment 3 $ 5,502 $ 4,350 Leasehold improvements Lesser of useful life 1,614 1,427 Furniture and fixtures 3 303 524 Construction in progress — 13,014 1,090 Computer equipment 3 216 93 Software 3 320 170 20,969 7,654 Less: Accumulated depreciation and ( 6,326 ) ( 4,864 ) Property and equipment, net $ 14,643 $ 2,790 |
Accrued and Other Current Lia_2
Accrued and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Summary of Accrued and Other Current Liabilities | Accrued and other current liabilities consisted of the following (in thousands): December 31 2021 2020 Accrued compensation $ 4,020 $ 3,833 Accrued CMO costs 1,077 244 Accrued professional services 546 363 Accrued research and development expenses 504 65 Accrued other liabilities 503 272 Accrued CRO costs 32 955 Total $ 6,682 $ 5,732 |
Regeneron License and Collabo_2
Regeneron License and Collaboration Arrangement (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Change in Company's Contract Liabilities | The following table presents changes in the Company’s contract liabilities (in thousands): Year ended December 31, 2021 Balance at beginning Additions Additions (Deductions) (1) Balance at Contract liability $ 13,980 $ — $ ( 9,175 ) $ 4,805 Year ended December 31, 2020 Balance at beginning Additions Additions (Deductions) (1) Balance at Contract asset $ — $ 10,000 $ ( 10,000 ) $ — Contract liability $ 21,883 $ 10,000 $ ( 17,903 ) $ 13,980 (1) Deductions to contract liabilities relate to deferred revenue recognized as revenue during the reporting period. |
Commitments and Contingences (T
Commitments and Contingences (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule Of Sublease Income | The expected undiscounted cash flows to be received from the sublease as of December 31, 2021 is as follows (in thousands): 2022 657 2023 671 2024 685 2025 699 2026 416 Total $ 3,128 |
Schedule of Weighted Average IBR and Remaining Lease Term | The IBR and the remaining lease terms of our facilities and their weighted average IBR and remaining terms are as follows as of December 31, 2021: Lease Locations IBR Remaining Terms Redwood City, CA 6.90 % 8.2 Boston, MA 9.30 % 4.6 Menlo Park, CA 6.80 % 0.5 Weighted Average 7.20 % 7.7 |
Summary of Lease Costs and Other Information | The following table contains a summary of the lease costs recognized under ASC 842 and other information pertaining to the Company’s operating leases for the years ended December 31, 2021 and 2020: December 31 2021 2020 Lease Cost (in thousands) (in thousands) Operating lease cost $ 4,282 $ 894 Short-term lease cost 235 56 Variable lease cost — — Sublease Income ( 223 ) — Total lease cost $ 4,294 $ 950 Other Information Operating cash flows used for lease liabilities $ 511 $ 859 Operating lease right of use asset obtained in exchange of operating lease liability $ — $ 22,367 |
Maturities Of Operating Lease Liabilities | The maturities of the operating lease liabilities as of December 31, 2021 were as follows (in thousands): 2022 2,933 2023 3,428 2024 3,525 2025 3,625 2026 and thereafter 13,747 Total undiscounted lease payments 27,258 Less: imputed interest 6,314 Total operating lease liability 20,944 Less: current portion 1,567 Operating lease liability, net of current maturities $ 19,377 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Number of Shares of Common Stock Reserved for Future Issuance | The Company has the following shares of common stock reserved for future issuance: December 31, 2021 2020 Stock options available for future grant 1,961,338 1,739,621 Stock options issued and outstanding 3,875,317 3,706,945 Unvested restricted stock units 771,660 — Common stock warrants issued and outstanding 220,890 226,191 Total common stock reserved 6,829,205 5,672,757 |
Schedule of Outstanding Warrants | The following provides a roll forward of outstanding warrants: Number of Weighted Weighted Outstanding and exercisable warrants to purchase 226,191 $ 11.3177 5.66 Issued — Exercised ( 5,301 ) Outstanding and exercisable warrants to purchase 220,890 $ 11.3177 4.66 |
Schedule of Outstanding Warrants to Purchase Shares of Common Stock | As of December 31, 2021, the Company's outstanding warrants to purchase shares of common stock consisted of the following: Number of Exercise Classification Expiration Date September 15, 2020 101,610 $ 11.3177 Equity July 25, 2026 September 15, 2020 30,924 $ 11.3177 Equity August 21, 2026 September 15, 2020 77,312 $ 11.3177 Equity September 19, 2026 September 15, 2020 11,044 $ 11.3177 Equity September 26, 2026 220,890 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Stock-Based Compensation Expense | The following table presents stock-based compensation expense as reflected in the Company's consolidated statements of operations and comprehensive loss (in thousands): Year Ended December 31, 2021 2020 Research and development $ 4,759 $ 1,674 General and administrative 7,752 3,589 Total stock-based compensation $ 12,511 $ 5,263 The following table presents stock-based compensation expense by type of award (in thousands): Year Ended December 31, 2021 2020 Stock Options 10,511 5,263 Restricted stock units (including performance-based RSUs) 1,944 — Employee Stock Purchase Plan 56 — Total $ 12,511 $ 5,263 |
Summary of Stock Option Activity | A summary of stock option activity is set forth below (in thousands, except share and per share data): Outstanding Awards Number of Weighted Weighted Aggregate Outstanding, December 31, 2020 3,706,945 $ 10.90 7.98 $ 15,126 Options authorized — Options granted 2,161,472 $ 14.37 Options exercised ( 1,125,339 ) $ 4.17 Options forfeited or cancelled ( 867,761 ) $ 14.06 Outstanding, December 31, 2021 3,875,317 $ 14.08 8.85 $ 13,212 Options exercisable December 31, 2021 991,847 $ 13.42 8.46 $ 4,033 Vested and expected to vest, December 31, 2021 3,875,317 $ 14.08 8.85 $ 13,212 |
Schedule of Assumptions to Estimate Fair Value of Stock Options Using Black-Scholes Option Pricing Model | The fair value of each stock option was estimated at the date of grant using a Black-Scholes option-pricing model using the following assumptions: Year Ended December 31, 2021 2020 Expected volatility 77.2 % - 79.8 % 72.6 % - 96.3 % Risk-free interest rate 0.1 % - 1.4 % 0.1 % - 1.7 % Dividend yield — — Expected term 0.90 - 6.08 years 1.00 - 6.08 years |
Summary of Restricted Stock Unit Activity | The following table presents a summary of the Company's RSU activity and related information: Number of Units Outstanding Weighted- Outstanding, December 31, 2020 — RSUs granted (including performance-based RSUs) 777,160 $ 7.84 RSUs Vested — RSUs forfeited ( 5,500 ) $ 7.12 Outstanding, December 31, 2021 771,660 $ 7.85 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders | The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share data): Year Ended December 31, 2021 2020 Numerator: Net loss attributable to common stockholders $ ( 61,999 ) $ ( 36,678 ) Denominator: Weighted-average shares used in computing net loss 30,952,152 7,319,977 Net loss per share attributable to common stockholders, $ ( 2.00 ) $ ( 5.01 ) |
Schedule of Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss Per Share | The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net loss per share attributable to common stockholders for the period presented because including them would have been antidilutive: December 31, 2021 2020 Options to purchase common stock 3,875,317 3,706,945 Unvested Restricted Stock Awards 771,660 — Common stock warrants 220,890 226,191 Total 4,867,867 3,933,136 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Provision for (Benefit from) Income Taxes | The components of the provision for (benefit from) income taxes are as follows (in thousands): Years Ended December 31, 2021 2020 Current: Federal $ — $ ( 2,678 ) State — 105 Foreign — — Total current — ( 2,573 ) Deferred: Federal ( 125 ) ( 242 ) State — — Foreign — — Total deferred ( 125 ) ( 242 ) Provision for (benefit from) income taxes $ ( 125 ) $ ( 2,815 ) |
Schedule of (Provision for) Benefit from Income Taxes Differs from Federal Statutory Rate to the Loss Before Taxes | For the rate table below the (provision for) benefit from income taxes differ from the amount expected by applying the federal statutory rate to the loss before taxes as follows: Year Ended December 31, 2021 2020 Federal statutory income tax rate 21.0 % 21.0 % Other permanent differences ( 1.9 )% ( 0.5 )% State income taxes 6.9 % 6.1 % Federal benefit from NOL carryback 0.0 % 6.7 % Change in valuation allowance ( 24.8 )% ( 25.8 )% Change in fair value of redeemable convertible preferred stock tranche liability and TRDF liability 0.0 % ( 0.5 )% Stock-based compensation ( 1.0 )% 0.1 % Provision for income taxes 0.2 % 7.1 % |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of temporary differences and carryforwards of the deferred tax assets are presented below (in thousands): December 31, 2021 2020 Deferred Tax Assets: Net operating loss carryforwards $ 67,675 $ 51,796 Operating lease right-of-use asset liability 5,504 5,686 Deferred revenue 1,263 2,857 Stock-based compensation 1,726 1,750 Intangible assets 1,081 1,195 Fixed assets 196 — Accruals and reserves 1,042 654 Research and development credit carryforwards 26 26 Gross deferred tax assets 78,513 63,964 Less: Valuation allowance ( 73,163 ) ( 57,715 ) Deferred tax assets, net of valuation allowance 5,350 6,249 Deferred tax liabilities: Fixed assets — — Basis Difference IPR&D — ( 313 ) Operating lease right-of-use asset ( 5,350 ) ( 6,061 ) Net deferred tax assets $ — $ ( 125 ) |
Schedule of Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending unrecognized tax benefit amount is as follows (in thousands): Year Ended December 31, 2021 2020 Balance at the beginning of the year $ 797 $ 797 Adjustment based on tax positions related to current year 3,243 — Balance at the end of the year $ 4,040 $ 797 |
Organization and Nature of the
Organization and Nature of the Business - Additional Information (Details) $ / shares in Units, $ in Thousands | Dec. 31, 2021USD ($)$ / sharesshares | Sep. 15, 2020 | Sep. 15, 2020 | Feb. 28, 2021USD ($)$ / sharesshares | Dec. 31, 2021USD ($)$ / sharesshares | Dec. 31, 2020USD ($)shares |
Schedule Of Equity Method Investments [Line Items] | ||||||
Entity incorporation date | Nov. 30, 2014 | |||||
Entity date of merger | Apr. 28, 2020 | |||||
Equity method investment, Ownership percentage | 25.00% | 25.00% | ||||
Reverse stock split | 1-for-7 | 1-for-7 | ||||
Exchange ratio | 0.1240 | |||||
Common stock, shares outstanding | shares | 39,736,914 | 39,736,914 | 19,677,249 | |||
Accumulated deficit | $ | $ 168,324 | $ 168,324 | $ 106,325 | |||
Payments for repurchase of common stock | $ | $ 15,000 | |||||
Common stock, shares repurchased under stock purchase agreement | shares | 1,153,840 | |||||
Adicet Therapeutics [Member] | ||||||
Schedule Of Equity Method Investments [Line Items] | ||||||
Equity method investment, Ownership percentage | 75.00% | 75.00% | ||||
Common stock, shares outstanding | shares | 19,589,828 | 19,589,828 | ||||
Accumulated deficit | $ | $ 168,300 | $ 168,300 | ||||
Initial Public Offering | ||||||
Schedule Of Equity Method Investments [Line Items] | ||||||
Number of common stock shares sold | shares | 7,187,500 | 10,575,513 | ||||
Payments for repurchase of common stock | $ | $ 15,000 | |||||
Common stock, shares repurchased under stock purchase agreement | shares | 1,153,840 | |||||
Issuance price per shares | $ / shares | $ 14 | $ 13 | $ 14 | |||
Underwriting discounts and commissions and other offering expenses | $ | $ 94,200 | $ 128,800 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) | Sep. 15, 2020 | Mar. 31, 2021USD ($) | Jun. 30, 2021USD ($) | Dec. 31, 2021USD ($)CustomerSegment | Dec. 31, 2020USD ($) |
Summary Of Significant Accounting Policies [Line Items] | |||||
Exchange ratio | 0.1240 | ||||
Gain (loss) on change in fair value of CVR | $ 1,000,000 | ||||
Goodwill impairment | $ 0 | ||||
Impairment charges | $ 500,000 | $ 700,000 | $ 2,300,000 | ||
Number of customer | Customer | 1 | ||||
Customers percentage of total revenue | 100.00% | 100.00% | |||
Outstanding accounts receivable percentage | 100.00% | ||||
Asset impairment charges | $ 0 | $ 0 | |||
Number of Operating Segments | Segment | 1 | ||||
Number of Reportable Segments | Segment | 1 | ||||
Operating lease right-of-use asset | $ 20,358,000 | $ 23,066,000 | |||
Operating lease liability | 20,944,000 | ||||
Research And Development Expenses | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Impairment charges | $ 1,200,000 |
Business Combination - Addition
Business Combination - Additional Information (Details) $ in Thousands | Jul. 29, 2021 | Sep. 15, 2020shares | Sep. 15, 2020shares | Dec. 31, 2021USD ($)ValueRightshares | Dec. 31, 2020USD ($) |
Business Acquisition [Line Items] | |||||
Reverse stock split | 1-for-7 | 1-for-7 | |||
Goodwill | $ | $ 19,462 | $ 20,089 | |||
Expiration period closing of the merger | 60 days | ||||
Common Stock | |||||
Business Acquisition [Line Items] | |||||
Number of common stock shares sold | 18,916,853 | ||||
resTORbio | |||||
Business Acquisition [Line Items] | |||||
Reverse stock split exchange ratio | 0.1240 | ||||
Percentage of outstanding capital stock | 75.00% | 75.00% | |||
Number of shares of surviving stock options | 81,370 | ||||
Unvested restricted stock units outstanding | 91,309 | 91,309 | |||
Number of common stock shares sold | 54,553 | ||||
Goodwill | $ | $ 19,462 | ||||
Transaction cost for merger | $ | $ 7,100 | ||||
Contractual Contingent Value Right | ValueRight | 1 | ||||
resTORbio | Common Stock | |||||
Business Acquisition [Line Items] | |||||
Percentage of outstanding capital stock | 25.00% | 25.00% |
Business Combination - Schedule
Business Combination - Schedule of Summarizes the Purchase Price in the Merger (Details) - USD ($) $ in Thousands | Sep. 15, 2020 | Dec. 31, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | |||
Contingent consideration liability | $ 980 | ||
resTORbio | |||
Business Acquisition [Line Items] | |||
Fair value of common stock shares of the combined company owned by resTORbio stockholders | $ 84,142 | ||
Contingent consideration liability | 2,880 | ||
Purchase price | $ 87,022 |
Business Combination - Schedu_2
Business Combination - Schedule of Estimated Share Consideration of Combined Company (Details) - resTORbio $ / shares in Units, $ in Thousands | Sep. 15, 2020USD ($)$ / sharesshares |
Business Acquisition [Line Items] | |
Number of shares of the combined company owned by resTORbio stockholders | shares | 5,207,695 |
Multiplied by the fair value per share of resTORbio common stock | $ / shares | $ 16.59 |
Acquisition date fair value of resTORbio common shares | $ 86,396 |
Estimated fair value of modified stock options and restricted stock units attributable to pre-combination services | 626 |
Less: portion of the fair value to be distributed as CVR | (2,880) |
Fair value of common stock shares of the combined company owned by resTORbio stockholders | $ 84,142 |
Business Combination - Schedu_3
Business Combination - Schedule of Estimated Share Consideration of Combined Company (Parenthetical) (Details) - resTORbio | Sep. 15, 2020shares |
Business Acquisition [Line Items] | |
Number of shares of the combined company owned by resTORbio stockholders | 5,207,695 |
Number of common stock shares sold | 54,553 |
Business Combination - Schedu_4
Business Combination - Schedule of Summarizes the Purchase Price in the Merger (Parenthetical) (Details) - resTORbio | Sep. 15, 2020shares |
Business Acquisition [Line Items] | |
Unvested restricted stock units outstanding | 91,309 |
Number of common stock shares sold | 54,553 |
Number of shares of surviving stock options | 81,370 |
Business Combination - Schedu_5
Business Combination - Schedule of Summarizes the Allocation of the Purchase Price to the Net Tangible and Intangible Assets Acquired (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Net assets acquired: | ||
Goodwill | $ 19,462 | $ 20,089 |
resTORbio | ||
Net assets acquired: | ||
Cash and cash equivalents | 63,869 | |
Prepaid expenses and other current assets | 3,674 | |
Property and equipment | 318 | |
IPR&D | 3,490 | |
Restricted cash | 245 | |
Accounts payable | (1,304) | |
Accrued and other current liabilities | (2,365) | |
Deferred tax liability | (367) | |
Goodwill | 19,462 | |
Purchase price | 87,022 | |
resTORbio | Preliminary | ||
Net assets acquired: | ||
Cash and cash equivalents | 63,869 | |
Prepaid expenses and other current assets | 3,059 | |
Property and equipment | 318 | |
IPR&D | 3,490 | |
Restricted cash | 245 | |
Accounts payable | (1,316) | |
Accrued and other current liabilities | (2,365) | |
Other liabilities | 0 | |
Deferred tax liability | (367) | |
Goodwill | 20,089 | |
Purchase price | $ 87,022 | |
resTORbio | Measurement Period Adjustments | ||
Net assets acquired: | ||
Prepaid expenses and other current assets | 615 | |
Accounts payable | 12 | |
Goodwill | $ (627) |
Business Combination - Schedu_6
Business Combination - Schedule of changes in the Company's IPR&D and CVR since the Merger (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Sep. 15, 2020 |
In Process Research and Development | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value | $ 1,190 | $ 3,490 | |
In Process Research and Development | Measure of Changes in Fair Value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value | (1,190) | (2,300) | |
Contingent Value Rights Agreement | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value | 980 | $ 2,880 | |
Contingent Value Rights Agreement | Measure of Changes in Fair Value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value | $ (980) | $ (1,900) |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Assets and Liabilities Measured on Recurring Basis (Details) - Fair Value Recurring [Member] - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | $ 147,071 | $ 74,101 | |
Total fair value of liabilities | 980 | ||
Money Market Funds | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | [1] | 147,071 | 63,817 |
Commercial Paper | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | [2] | 1,000 | |
Marketable Securities | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | [2] | 10,284 | |
Asset Backed Securities | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | [2] | 7,522 | |
Corporate Debt Securities | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | [2] | 1,762 | |
Redeemable Convertible Preferred Stock Warrant Liability | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of liabilities | 980 | ||
Fair Value Level 1 | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | 147,071 | 63,817 | |
Fair Value Level 1 | Money Market Funds | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | [1] | $ 147,071 | 63,817 |
Fair Value Level 2 | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | 10,284 | ||
Fair Value Level 2 | Commercial Paper | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | [2] | 1,000 | |
Fair Value Level 2 | Marketable Securities | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | [2] | 10,284 | |
Fair Value Level 2 | Asset Backed Securities | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | [2] | 7,522 | |
Fair Value Level 2 | Corporate Debt Securities | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of assets | [2] | 1,762 | |
Fair Value Level 3 | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of liabilities | 980 | ||
Fair Value Level 3 | Redeemable Convertible Preferred Stock Warrant Liability | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Total fair value of liabilities | $ 980 | ||
[1] | Included in cash and cash equivalents in the consolidated balance sheets | ||
[2] | Included in short-term marketable debt securities in the consolidated balance sheets. |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) $ in Thousands | Dec. 31, 2021USD ($)shares |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |
Warrants outstanding | shares | 220,890 |
Estimated fair value of the CVR liability | $ | $ 0 |
Marketable Debt Securities - Sc
Marketable Debt Securities - Schedule of Marketable Debt Securities (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Marketable Securities [Line Items] | |
Amortized Cost | $ 10,260 |
Unrealized Losses | 0 |
Unrealized Gains | 24 |
Fair Value | 10,284 |
Asset Backed Securities | |
Marketable Securities [Line Items] | |
Amortized Cost | 7,507 |
Unrealized Losses | 0 |
Unrealized Gains | 15 |
Fair Value | 7,522 |
Corporate Debt Securities | |
Marketable Securities [Line Items] | |
Amortized Cost | 1,754 |
Unrealized Losses | 0 |
Unrealized Gains | 8 |
Fair Value | 1,762 |
Commercial Paper | |
Marketable Securities [Line Items] | |
Amortized Cost | 999 |
Unrealized Gains | 1 |
Fair Value | $ 1,000 |
Marketable Debt Securities - Su
Marketable Debt Securities - Summary of Classification of Marketable Debt Securities in Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Investments, Debt and Equity Securities [Abstract] | ||
Short-term marketable debt securities | $ 0 | $ 10,284 |
Long-term marketable debt securities | 0 | |
Marketable debt securities | $ 0 | $ 10,284 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets - Summary of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid insurance | $ 1,884 | $ 1,443 |
Prepayments to CRO's | 1,658 | 420 |
Prepaid maintenance | 1,021 | 761 |
Prepayments to CMO's | 115 | 135 |
Other current assets | 2 | 229 |
Tax receivable | 0 | 2,711 |
Interest receivable | 29 | 23 |
Total prepaid expenses and other current assets | $ 4,709 | $ 5,722 |
Property and Equipment, Net - S
Property and Equipment, Net - Summary of Property and Equipment, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 20,969 | $ 7,654 |
Less: Accumulated depreciation and amortization | (6,326) | (4,864) |
Property and equipment, net | 14,643 | 2,790 |
Laboratory Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 5,502 | 4,350 |
Useful life (in years) | 3 years | |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 1,614 | 1,427 |
Useful life (in years) | Lesser of useful lifeor lease term | |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 303 | 524 |
Useful life (in years) | 3 years | |
Construction In Progress | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 13,014 | 1,090 |
Computer Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 216 | 93 |
Useful life (in years) | 3 years | |
Software | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 320 | $ 170 |
Useful life (in years) | 3 years |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation and amortization expense | $ 1,538 | $ 1,226 |
Increase in construction in progress | $ 11,900 | $ 11,900 |
Accrued and Other Current Lia_3
Accrued and Other Current Liabilities - Summary of Accrued and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accrued compensation | $ 4,020 | $ 3,833 |
Accrued CMO costs | 1,077 | 244 |
Accrued professional services | 546 | 363 |
Accrued research and development expenses | 504 | 65 |
Accrued other liabilities | 503 | 272 |
Accrued CRO costs | 32 | 955 |
Total | $ 6,682 | $ 5,732 |
Term Loan - Additional Informat
Term Loan - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Oct. 21, 2021 | Apr. 28, 2020 | |
Class Of Warrant Or Right [Line Items] | |||
Interest rate for term loan to finance leasehold improvements | 5.00% | ||
Loan availability end date | Oct. 28, 2021 | ||
Debt issuance costs, gross | $ 0.1 | ||
Fourth Amendment | Pacific western bank | |||
Class Of Warrant Or Right [Line Items] | |||
Available Loan | $ 10.6 | ||
Loan amount drawn | $ 5.5 | ||
Term loan and non formula ancillary service | $ 15 | ||
Long-term Debt, Description | which each Term Loan to be in an amount of not less than $1.0 million. As of December 31, 2021, the Company had outstanding Non-Formula Ancillary Services of $4.4 million. Accordingly, as of December 31, 2021, the Company has $10.6 million available under the Term Loan. Pursuant to the Loan Amendment, the interest rate for the Term Loans shall be set at an annual rate equal to the greater of (i) 0.25% above the Prime Rate then in effect and (ii) 4.25%. | ||
Outstanding balance under the loan agreement | $ 4.4 | ||
Maximum [Member] | |||
Class Of Warrant Or Right [Line Items] | |||
Term loan to finance leasehold improvements | $ 12 | ||
Minimum [Member] | Prime Rate | |||
Class Of Warrant Or Right [Line Items] | |||
Interest rate for term loan to finance leasehold improvements | 0.25% |
Regeneron License and Collabo_3
Regeneron License and Collaboration Arrangement - Additional Information (Details) - USD ($) | Jan. 28, 2022 | Dec. 31, 2021 | Jul. 31, 2019 | Jul. 29, 2016 | Jun. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2018 | Dec. 31, 2017 |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||||
Exercised Investment Right and Purchased | $ 10,000,000 | |||||||||
Licence agreement cumulative revenue recognised | 40,200,000 | |||||||||
License and collaboration revenue | 9,200,000 | $ 17,900,000 | ||||||||
Payment from Regeneron for exercise of its option to license exclusive rights | 4,688,000 | 460,000 | ||||||||
Regeneron Pharmaceuticals, Inc. | ||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||||
Non refundable upfront payment received | $ 25,000,000 | |||||||||
Additional payment for research funding received | 20,000,000 | $ 30,000,000 | $ 10,000,000 | $ 10,000,000 | ||||||
Contract research term period | 5 years | |||||||||
Upfront payment | $ 25,000,000 | $ 25,000,000 | 25,000,000 | |||||||
Licence agreement additional revenue recognised | $ 5,000,000 | |||||||||
Contingent Consideration fees | 20,000,000 | |||||||||
Agreement transaction price | 55,000,000 | |||||||||
Research funding fee | $ 30,000,000 | |||||||||
Increase in estimated transaction price | $ 35,000,000 | 10,000,000 | ||||||||
License agreement termination description | twelve (12) years | |||||||||
Licence agreement cumulative revenue recognised | $ 10,000,000 | |||||||||
Contract liability | $ 4,800,000 | 14,000,000 | ||||||||
Payment from Regeneron for exercise of its option to license exclusive rights | $ 20,000,000 | |||||||||
Regeneron Pharmaceuticals, Inc. | Maximum [Member] | ||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||||
Licence agreement additional amount payable of option exercise fees | $ 80,000,000 | |||||||||
Increase in estimated transaction price | $ 45,000 | |||||||||
Regeneron Pharmaceuticals, Inc. | Minimum [Member] | ||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||||
Licence agreement cumulative revenue recognised | $ 31,000,000 |
Regeneron License and Collabo_4
Regeneron License and Collaboration Arrangement - Summary of Change in Company's Contract Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | |||
Contract Asset | ||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Additions | $ 10,000 | |||
Additions (Deductions) | [1] | (10,000) | ||
Contract Liability | ||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Balance at beginning of period | $ 13,980 | 21,883 | ||
Additions | 10,000 | |||
Additions (Deductions) | (9,175) | (17,903) | [1] | |
Balance at end of period | $ 4,805 | $ 13,980 | ||
[1] | (1) Deductions to contract liabilities relate to deferred revenue recognized as revenue during the reporting period. |
License Funding and Other Agr_2
License Funding and Other Agreements Related to the CVR - Additional Information (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Feb. 28, 2021 | Nov. 30, 2020 | May 31, 2019 | Dec. 31, 2021 | Mar. 23, 2017 |
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||
Estimated fair value of the CVR liability | $ 0 | |||||
National Institute of Health | ||||||
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||
Grant term | 5 years | |||||
Grants receivable | $ 1,500 | |||||
Qualifying expenses | 500 | |||||
Qualifying Expenses On Cumulative Basis | 1,300 | |||||
National Institute of Health | Research Funding Agreement | ||||||
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||
Qualifying expenses | 400 | |||||
Qualifying Expenses On Cumulative Basis | 1,300 | |||||
Contingent Value Rights Agreement | C O V I D19 | ||||||
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||
Total fees and expenses related to clinical trials | $ 1,100 | 3,000 | ||||
Increase decrease in estimated fair value of CVR liability | $ 400 | |||||
Estimated fair value of the CVR liability | $ 600 | $ 0 | ||||
Post Exposure Prophylaxis Description | In February 2021, management terminated the National Institute on Aging study of RTB101 for COVID-19 post-exposure prophylaxis in adults age 65 years and older due to poor enrollment | |||||
Novartis License Agreement | Novartis International Pharmaceutical Ltd. | ||||||
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||
License agreement termination description | The agreement may be terminated by either party upon a material breach of obligation by the other party that is not cured with 60 days after written notice. resTORbio may terminate the agreement in its entirety or on a product-by-product or country-by-country basis with or without cause with 60 days’ prior written notice. | |||||
Novartis License Agreement | Novartis International Pharmaceutical Ltd. | Maximum [Member] | ||||||
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||
Aggregate amount payable upon satisfaction of clinical milestones | $ 4,300 | |||||
Aggregate amount payable upon satisfaction of regulatory milestones for first indication approved | 24,000 | |||||
Aggregate amount payable upon satisfaction of regulatory milestones for second indication approved | 18,000 | |||||
Aggregate amount payable upon satisfaction of commercial milestones | $ 125,000 |
Commitment and Contingencies -
Commitment and Contingencies - Additional Information (Details) | Jul. 19, 2021USD ($)ft² | Jun. 25, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2021USD ($)Lawsuit | Dec. 31, 2020USD ($) |
Long Term Purchase Commitment [Line Items] | |||||
Change in lease Obligation | $ 0 | ||||
Amended lease Agreement Description | the Company entered into an amendment to the Menlo Park lease to extend the term of the lease from March 31, 2022 to June 30, 2022 and replace the previously leased premises (known as 173 and 175-177 Jefferson Drive) with another nearby premises (known as 235 Constitution Drive). | ||||
Lease expiration date | Jun. 30, 2022 | ||||
Operating leases commencement date | Jul. 15, 2021 | ||||
Operating lease right-of-use asset | $ 23,066,000 | $ 20,358,000 | $ 23,066,000 | ||
Operating lease liability | 20,944,000 | ||||
Operating lease right-of-use asset | 23,066,000 | $ 20,358,000 | 23,066,000 | ||
Lawsuits Filed Against Company | Lawsuit | 7 | ||||
Litigation settlement expense | $ 200,000 | ||||
Topic 842 | |||||
Long Term Purchase Commitment [Line Items] | |||||
Lease payments | $ 4,300,000 | $ 900,000 | |||
Minimum [Member] | |||||
Long Term Purchase Commitment [Line Items] | |||||
Rent expense recognized | $ 87,286,000 | ||||
Maximum [Member] | |||||
Long Term Purchase Commitment [Line Items] | |||||
Rent expense recognized | $ 89,904,000 | ||||
RFS OPCO LLC [Member] | |||||
Long Term Purchase Commitment [Line Items] | |||||
Area of Sublease | ft² | 9,501 | ||||
Sublease Agreement Description | The term of the sublease started on September 1, 2021 and ends on July 30, 2026. The aggregate base rent due to the Company under the Sublease is approximately $3.5 million starting October 1, 2021. The Company records sublease income as a reduction of lease expense. | ||||
Operating Leases, Rent Expense, Sublease Rentals | $ 3,500,000 | ||||
Cash security deposit received | $ 100,000 | ||||
Menlo Park Lease Agreement [Member] | |||||
Long Term Purchase Commitment [Line Items] | |||||
Letters of Credit issued amount | 200,000 | ||||
Redwood City Lease Agreement [Member] | |||||
Long Term Purchase Commitment [Line Items] | |||||
Letters of Credit issued amount | 4,100,000 | ||||
Boston, Massachusetts [Member] | |||||
Long Term Purchase Commitment [Line Items] | |||||
Letters of Credit issued amount | $ 200,000 |
Commitments And Contingencies -
Commitments And Contingencies - Schedule of Sublease Income (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2022 | $ 657 |
2023 | 671 |
2024 | 685 |
2025 | 699 |
2026 | 416 |
Total | $ 3,128 |
Commitment and Contingencies _2
Commitment and Contingencies - Schedule of Weighted Average IBR and Remaining Lease Term (Details) | Dec. 31, 2021 |
Long Term Purchase Commitment [Line Items] | |
Weighted Average IBR | 7.20% |
Remaining Terms (in years) | 7 years 8 months 12 days |
Redwood City, CA | |
Long Term Purchase Commitment [Line Items] | |
Weighted Average IBR | 6.90% |
Remaining Terms (in years) | 8 years 2 months 12 days |
Boston, MA | |
Long Term Purchase Commitment [Line Items] | |
Weighted Average IBR | 9.30% |
Remaining Terms (in years) | 4 years 7 months 6 days |
Menlo Park, CA | |
Long Term Purchase Commitment [Line Items] | |
Weighted Average IBR | 6.80% |
Remaining Terms (in years) | 6 months |
Commitment and Contingencies _3
Commitment and Contingencies - Summary of Lease Costs and Other Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Lease Cost | ||
Operating lease cost | $ 4,282 | $ 894 |
Short-term lease cost | 235 | 56 |
Variable lease cost | 0 | 0 |
Sublease Income | (223) | |
Total lease cost | 4,294 | 950 |
Other Information | ||
Operating cash flows used for lease liabilities | 511 | 859 |
Operating lease right of use asset obtained in exchange of operating lease liability | $ 22,367 |
Commitment and Contingencies _4
Commitment and Contingencies - Schedule Of Maturities Of Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
2022 | $ 2,933 | |
2023 | 3,428 | |
2024 | 3,525 | |
2025 | 3,625 | |
2026 and thereafter | 13,747 | |
Total undiscounted lease payments | 27,258 | |
Less: imputed interest | 6,314 | |
Total operating lease liability | 20,944 | |
Less: current portion | 1,567 | $ 1,215 |
Operating lease liability, net of current maturities | $ 19,377 | $ 20,424 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | ||||
Number of common stock shares sold | 10,575,513 | 7,187,500 | ||
Public offering price | $ 13 | $ 14 | ||
Proceeds from the offering | $ 128.8 | |||
Description of stock purchase agreement | the Company also entered into a stock purchase agreement with certain existing investors to purchase 1,153,840 shares of our common stock for $15.0 million at a price per share equal to the public offering price, with an initial closing for investors held simultaneously with the closing of the offering and a subsequent closing for certain additional investors. | |||
Common stock, shares repurchased under stock purchase agreement | 1,153,840 | |||
Payments for repurchase of common stock | $ 15 | |||
Net proceeds from the offering, after deducting expenses | $ 94.2 | |||
Warrant exercised | (5,301) | |||
Common stock dividends declared | $ / shares | $ 0 | $ 0 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Number of Shares of Common Stock Reserved for Future Issuance (Details) - shares | Dec. 31, 2021 | Dec. 31, 2020 |
Class Of Stock [Line Items] | ||
Number of shares of common stock reserved for future issuance | 6,829,205 | 5,672,757 |
Options Issued and Outstanding | ||
Class Of Stock [Line Items] | ||
Number of shares of common stock reserved for future issuance | 3,875,317 | 3,706,945 |
Stock Options Available for Future Grant | ||
Class Of Stock [Line Items] | ||
Number of shares of common stock reserved for future issuance | 1,961,338 | 1,739,621 |
Unvested Restricted Stock Awards | ||
Class Of Stock [Line Items] | ||
Number of shares of common stock reserved for future issuance | 771,660 | 0 |
Common Stock Warrants | ||
Class Of Stock [Line Items] | ||
Number of shares of common stock reserved for future issuance | 220,890 | 226,191 |
Stockholders' Equity - Schedu_2
Stockholders' Equity - Schedule of Outstanding Warrants (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Liabilities and Equity [Abstract] | ||
Number of warrants, Outstanding and exercisable to purchase preferred shares as of December 31, 2020 | 226,191 | |
Number of warrants, Issued | 0 | |
Number of warrants, Exercised | (5,301) | |
Number of warrants, Outstanding and exercisable to purchase common stock as of December 31, 2021 | 220,890 | |
Warrant exercise price | $ 11.3177 | $ 11.3177 |
Warrants outstanding and exercisable, Weighted average remaining contractual term | 4 years 7 months 28 days | 5 years 7 months 28 days |
Stockholders' Equity - Schedu_3
Stockholders' Equity - Schedule Of Outstanding Warrants To Purchase Shares of Common Stock (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Class Of Stock [Line Items] | ||
Number of Shares of Common Stock Issuable | 220,890 | |
Warrant exercise price | $ 11.3177 | $ 11.3177 |
September 15, 2020 Warrant One | ||
Class Of Stock [Line Items] | ||
Issuance Date | Sep. 15, 2020 | |
Number of Shares of Common Stock Issuable | 101,610 | |
Warrant exercise price | $ 11.3177 | |
Expiration Date | Jul. 25, 2026 | |
September 15, 2020 Warrant Two | ||
Class Of Stock [Line Items] | ||
Issuance Date | Sep. 15, 2020 | |
Number of Shares of Common Stock Issuable | 30,924 | |
Warrant exercise price | $ 11.3177 | |
Expiration Date | Aug. 21, 2026 | |
September 15, 2020 Warrant Three | ||
Class Of Stock [Line Items] | ||
Issuance Date | Sep. 15, 2020 | |
Number of Shares of Common Stock Issuable | 77,312 | |
Warrant exercise price | $ 11.3177 | |
Expiration Date | Sep. 19, 2026 | |
September 15, 2020 Warrant Four | ||
Class Of Stock [Line Items] | ||
Issuance Date | Sep. 15, 2020 | |
Number of Shares of Common Stock Issuable | 11,044 | |
Warrant exercise price | $ 11.3177 | |
Expiration Date | Sep. 26, 2026 |
At-The-Market (ATM) Offering -
At-The-Market (ATM) Offering - Additional Information (Details) - At The Market Offering [Member] - USD ($) $ in Millions | Mar. 12, 2021 | Dec. 01, 2020 |
Class Of Stock [Line Items] | ||
Agreement terminated | 2021-02 | |
Sales Agreement [Member] | Maximum [Member] | ||
Class Of Stock [Line Items] | ||
Maximum aggregate value of common stock available for offering at-the-market price | $ 75 | $ 50 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total stock-based compensation expense | $ 12,511 | $ 5,263 |
Research And Development Expenses | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total stock-based compensation expense | 4,759 | 1,674 |
General and Administrative | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total stock-based compensation expense | 7,752 | 3,589 |
Stock Option | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total stock-based compensation expense | 10,511 | 5,263 |
Employee Stock Purchase Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total stock-based compensation expense | 56 | |
Restricted Stock Units (RSUs) | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total stock-based compensation expense | $ 1,944 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 01, 2022 | May 01, 2021 | Apr. 27, 2021 | Jan. 01, 2021 | Jan. 01, 2020 | Jan. 01, 2019 | Oct. 31, 2021 | Aug. 31, 2021 | May 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2018 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Weighted average exercise price | $ 4.17 | |||||||||||
Expense related to options granted | $ 12,511 | $ 5,263 | ||||||||||
Weighted average exercise price | $ 14.37 | |||||||||||
Aggregate intrinsic value of options exercised | $ 10,100 | 2,500 | ||||||||||
Unrecognized compensation expense | $ 4,100 | |||||||||||
Unrecognized compensation expense, estimated weighted-average period for recognition | 1 year 3 months 18 days | |||||||||||
RSUs granted (includes PSUs) | 560,000 | 2,161,472 | ||||||||||
Stock issuance cost | $ 823,940 | |||||||||||
Options Issued and Outstanding | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Total fair value of options vested | $ 2,300 | $ 2,400 | ||||||||||
Weighted-average grant date fair value of options granted | $ 9.68 | $ 0.96 | ||||||||||
Unrecognized compensation expense | $ 24,800 | |||||||||||
Unrecognized compensation expense, estimated weighted-average period for recognition | 2 years 9 months 18 days | |||||||||||
Restricted Stock | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Expense related to options granted | $ 1,600 | $ 100 | ||||||||||
Weighted- Average Grant Date Fair Value, RSUs granted | $ 7.84 | |||||||||||
RSUs granted (includes PSUs) | 560,000 | 6,410 | ||||||||||
2018 Stock Incentive Plan | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Percentage of additional shares added on outstanding shares | 5.00% | 4.00% | ||||||||||
Number of additional shares reserved for issuance | 1,500,000 | |||||||||||
2018 Stock Incentive Plan | Subsequent Event | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Number of additional shares reserved for issuance | 1,986,845 | |||||||||||
2017 and 2018 Stock Incentive Plan | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Number of shares of common stock available for grant | 1,683,999 | |||||||||||
Number of shares reserved for issuance | 2,574,170 | |||||||||||
Weighted average exercise price | $ 15.10 | |||||||||||
RSUs granted (includes PSUs) | 6,410 | 205,250 | 771,660 | |||||||||
2014 Stock Incentive Plan Member | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Number of shares reserved for issuance | 22,987 | |||||||||||
Weighted average exercise price | $ 1.61 | |||||||||||
2015 Stock Incentive Plan Member | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Number of shares reserved for issuance | 915,657 | |||||||||||
Weighted average exercise price | $ 11.46 | |||||||||||
2014 and 2015 Stock Incentive Plan | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Number of shares of common stock available for grant | 277,339 | |||||||||||
2018 Employee Stock Purchase Plan | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Percentage of additional shares added on outstanding shares | 1.00% | |||||||||||
Number of additional shares reserved for issuance | 524,775 | 131,432 | 79,369 | 524,775 | ||||||||
Number of shares available for sale under employee stock purchase plan | 15,667 | 0 | ||||||||||
2018 Employee Stock Purchase Plan | Minimum [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Number of additional shares reserved for issuance | 77,703 | |||||||||||
2018 Employee Stock Purchase Plan | Maximum [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Stock issuance cost | $ 100 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |
Oct. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |||
Number of Shares Underlying Outstanding Options, Beginning balance | 3,706,945 | ||
Number of Shares Underlying Outstanding Options, Options granted | 560,000 | 2,161,472 | |
Number of Shares Underlying Outstanding Options, Options exercised | (1,125,339) | ||
Number of Shares Underlying Outstanding Options, Options forfeited or cancelled | (867,761) | ||
Number of Shares Underlying Outstanding Options, Ending balance | 3,875,317 | 3,706,945 | |
Number of Shares Underlying Outstanding Options, Shares exercisable | 991,847 | ||
Number of Shares Underlying Outstanding Options, Vested and expected to vest | 3,875,317 | ||
Weighted-Average Exercise Price, Outstanding beginning | $ 10.90 | ||
Weighted-Average Exercise Price, Options granted | 14.37 | ||
Weighted-Average Exercise Price, Options exercised | 4.17 | ||
Weighted-Average Exercise Price, Options forfeited or cancelled | 14.06 | ||
Weighted-Average Exercise Price, Outstanding ending | 14.08 | $ 10.90 | |
Weighted-Average Exercise Price, Shares exercisable | 13.42 | ||
Weighted-Average Exercise Price, Vested and expected to vest | $ 14.08 | ||
Weighted-Average Remaining Contract Term, Outstanding | 8 years 10 months 6 days | 7 years 11 months 23 days | |
Weighted-Average Remaining Contract Term, Shares exercisable | 8 years 5 months 15 days | ||
Weighted-Average Remaining Contract Term, Vested and expected to vest | 8 years 10 months 6 days | ||
Aggregate Intrinsic Value, Outstanding | $ 13,212 | $ 15,126 | |
Aggregate Intrinsic Value, Shares exercisable | 4,033 | ||
Aggregate Intrinsic Value, Vested and expected to vest | $ 13,212 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Assumptions to Estimate Fair Value of Stock Options Using Black-Scholes Option Pricing Model (Details) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected volatility, minimum | 77.20% | 72.60% |
Expected volatility, maximum | 79.80% | 96.30% |
Risk-free interest rate, minimum | 0.10% | 0.10% |
Risk-free interest rate, maximum | 1.40% | 1.70% |
Dividend yield | 0.00% | 0.00% |
Minimum [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected term (in years) | 10 months 24 days | 1 year |
Maximum [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected term (in years) | 6 years 29 days | 6 years 29 days |
Stock-Based Compensation - Su_3
Stock-Based Compensation - Summary of Restricted Stock Unit Activity (Details) - $ / shares | 1 Months Ended | 12 Months Ended |
Oct. 31, 2021 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
RSUs granted (includes PSUs) | 560,000 | 2,161,472 |
Restricted Stock Units (RSUs) [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Outstanding, December 31, 2020 | 0 | |
RSUs granted (includes PSUs) | 777,160 | |
RSUs Vested | 0 | |
RSUs forfeited | (5,500) | |
Outstanding, December 31,2021 | 771,660 | |
Weighted- Average Grant Date Fair Value, RSUs granted | $ 7.84 | |
Weighted Average Grant Date Fair Value, RSUs forfeited | 7.12 | |
Weighted- Average Grant Date Fair Value, ending balance | $ 7.85 |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share [Abstract] | ||
Net loss attributable to common stockholders | $ (61,999) | $ (36,678) |
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted | 30,952,152 | 7,319,977 |
Net loss per share attributable to common stockholders, basic and diluted | $ (2) | $ (5.01) |
Net Loss Per Share - Schedule_2
Net Loss Per Share - Schedule of Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss Per Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 4,867,867 | 3,933,136 |
Options To Purchase Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 3,875,317 | 3,706,945 |
Common Stock Warrants | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 220,890 | 226,191 |
Unvested Restricted Stock Awards | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 771,660 | 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Taxes Disclosure [Line Items] | |||||
Federal statutory income tax rate, percent | 21.00% | 21.00% | |||
Income tax expense (benefit) | $ (125) | $ (2,815) | |||
Increase in valuation allowance | 15,500 | 37,900 | |||
Net operating loss carryforwards | 67,675 | $ 51,796 | |||
Ownership change plan description | In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50% over a three-year period | ||||
Unrecognized tax benefits | 4,040 | $ 797 | $ 797 | ||
Impairment charges | $ 500 | $ 700 | $ 2,300 | ||
Intellectual Property | |||||
Income Taxes Disclosure [Line Items] | |||||
Unrecognized tax benefits | 800 | ||||
California Research And Development | |||||
Income Taxes Disclosure [Line Items] | |||||
Tax credit carryforward, amount | 1,500 | ||||
Federal and state research and development [Member] | |||||
Income Taxes Disclosure [Line Items] | |||||
Unrecognized tax benefits | 3,200 | ||||
Domestic Tax Authority | |||||
Income Taxes Disclosure [Line Items] | |||||
Operating loss carryforwards | 271,600 | ||||
Operating loss carryforwards, expiration date | Dec. 31, 2037 | ||||
Net operating loss carryforwards | 7,600 | ||||
Operating Loss Carryforwards Indefinitely | 264,000 | ||||
Tax credit carryforward, amount | 1,800 | ||||
State | |||||
Income Taxes Disclosure [Line Items] | |||||
Operating loss carryforwards | 143,500 | ||||
Operating loss carryforwards, expiration date | Dec. 31, 2035 | ||||
Foreign Tax Authority | |||||
Income Taxes Disclosure [Line Items] | |||||
Operating loss carryforwards | 17,100 | ||||
C O V I D19 | |||||
Income Taxes Disclosure [Line Items] | |||||
Income tax expense (benefit) | 100 | $ 2,800 | |||
Impairment charges | $ 1,200 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Provision for (benefit from) Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | ||
Federal | $ 0 | $ (2,678) |
State | 0 | 105 |
Foreign | 0 | 0 |
Total current | 0 | (2,573) |
Deferred: | ||
Federal | (125) | (242) |
State | 0 | 0 |
Foreign | 0 | 0 |
Total deferred | (125) | (242) |
Provision for (benefit from) income taxes | $ (125) | $ (2,815) |
Income Taxes - Schedule of (Pro
Income Taxes - Schedule of (Provision for) Benefit from Income Taxes Differs from Federal Statutory Rate to the Loss Before Taxes (Detail) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Federal statutory income tax rate, percent | 21.00% | 21.00% |
Other permanent differences | (1.90%) | (0.50%) |
State income taxes | 6.90% | 6.10% |
Federal benefit from NOL carryback | 0.00% | 6.70% |
Change in valuation allowance | (24.80%) | (25.80%) |
Change in fair value of redeemable convertible preferred stock tranche liability and TRDF liability | 0.00% | (0.50%) |
Stock-based compensation | (1.00%) | 0.10% |
Provision for income taxes | 0.20% | 7.10% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred Tax Assets: | ||
Net operating loss carryforwards | $ 67,675 | $ 51,796 |
Operating lease right-of-use asset liability | 5,504 | 5,686 |
Deferred revenue | 1,263 | 2,857 |
Stock-based compensation | 1,726 | 1,750 |
Intangible assets | 1,081 | 1,195 |
Fixed Assets | 196 | 0 |
Accruals and reserves | 1,042 | 654 |
Research and development credit carryforwards | 26 | 26 |
Gross deferred tax assets | 78,513 | 63,964 |
Less: Valuation allowance | (73,163) | (57,715) |
Deferred tax assets, net of valuation allowance | 5,350 | 6,249 |
Deferred tax liabilities: | ||
Fixed assets | 0 | 0 |
Basis Difference IPR&D | 0 | (313) |
Operating lease right-of-use asset | (5,350) | (6,061) |
Net deferred tax asset | $ 0 | $ 125 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Balance at the beginning of the year | $ 797 | $ 797 |
Adjustment based on tax positions related to current year | 3,243 | 0 |
Balance at the end of the year | $ 4,040 | $ 797 |
Defined Contribution Plan - Add
Defined Contribution Plan - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Defined Contribution Plan [Abstract] | ||
Defined contribution plan for employees | $ 0 | |
Company contribution in the plan | $ 300 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | ||
Common stock, shares issued | 39,736,914 | 19,677,249 |
Preferred Stock, Shares Issued | 0 | 0 |
Revenue—related party | $ 9,730 | $ 17,903 |
Regeneron Pharmaceuticals, Inc. | ||
Related Party Transaction [Line Items] | ||
Convertible Preferred Stock, Shares Issued upon Conversion | 883,568 | |
Revenue—related party | $ 9,700 | $ 17,900 |
Accounts receivable | 200 | |
Deferred Revenue | $ 4,800 | |
Regeneron Pharmaceuticals, Inc. | Series B Convertible Preferred Stock [ Member ] | ||
Related Party Transaction [Line Items] | ||
Common stock, shares issued | 883,568 | |
Preferred Stock, Shares Issued | 7,125,552 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) $ in Millions | Jan. 28, 2022USD ($) |
Subsequent Event | |
Subsequent Event [Line Items] | |
Exercise Fee Paid | $ 20 |