Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2020 | Oct. 31, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-39452 | |
Entity Registrant Name | INHIBRX, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-4257312 | |
Entity Address, Address Line One | 11025 N. Torrey Pines Road | |
Entity Address, Address Line Two | Suite 200 | |
Entity Address, City or Town | La Jolla | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92037 | |
City Area Code | (858) | |
Local Phone Number | 795-4220 | |
Title of 12(b) Security | Common Stock, par value $0.0001 | |
Trading Symbol | INBX | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | No | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 37,712,390 | |
Current Fiscal Year End Date | --12-31 | |
Amendment Flag | false | |
Entity Central Index Key | 0001739614 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 127,669,000 | $ 11,540,000 |
Accounts receivable | 681,000 | 199,000 |
Receivables from related parties | 283,000 | 239,000 |
Prepaid expenses and other current assets | 3,217,000 | 3,583,000 |
Total current assets | 131,850,000 | 15,561,000 |
Property and equipment, net | 3,274,000 | 3,230,000 |
Right-of-use asset | 8,185,000 | 7,453,000 |
Other non-current assets | 245,000 | 245,000 |
Total assets | 143,554,000 | 26,489,000 |
Current liabilities: | ||
Accounts payable | 15,186,000 | 3,115,000 |
Accrued expenses | 11,037,000 | 4,832,000 |
Current portion of deferred revenue | 5,176,000 | 7,939,000 |
Current portion of long-term debt, net of discount | 0 | 3,563,000 |
Current portion of lease liability | 1,463,000 | 1,105,000 |
Paycheck Protection Program loan | 1,875,000 | 0 |
Other current liabilities | 0 | 16,000 |
Total current liabilities | 34,737,000 | 20,570,000 |
Convertible notes, net of discount | 0 | 30,367,000 |
Derivative liabilities | 0 | 1,916,000 |
Non-current portion of deferred revenue | 170,000 | 1,000,000 |
Long-term debt, net of current portion and including final payment fee | 9,821,000 | 0 |
Non-current portion of lease liability | 7,097,000 | 6,698,000 |
Total liabilities | 51,825,000 | 60,551,000 |
Commitments and contingencies (Note 10) | ||
Convertible preferred stock, $0.0001 par value; no and 25,765,000 shares authorized at September 30, 2020 and December 31, 2019, respectively; no and 12,534,331 shares issued and outstanding at September 30, 2020 and December 31, 2019 respectively; liquidation preferences of $0 and $87.5 million at September 30, 2020 and December 31, 2019, respectively. | 0 | 59,507,000 |
Stockholders’ equity (deficit) | ||
Preferred stock, $0.0001 par value; 15,000,000 and no shares authorized at September 30, 2020 and December 31, 2019; no shares issued or outstanding. | 0 | 0 |
Common stock, $0.0001 par value; 120,000,000 and 65,000,000 shares authorized as of September 30, 2020 and December 31, 2019, respectively; 37,710,190 and 18,154,119 issued and outstanding as of September 30, 2020 and December 31, 2019, respectively. | 4,000 | 2,000 |
Additional paid-in-capital | 219,455,000 | (24,316,000) |
Accumulated deficit | (127,730,000) | (69,255,000) |
Total stockholders’ equity (deficit) | 91,729,000 | (93,569,000) |
Total liabilities, convertible preferred stock and stockholders’ equity (deficit) | $ 143,554,000 | $ 26,489,000 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Convertible preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Convertible preferred stock, shares authorized (in shares) | 0 | 25,765,000 |
Issuance of Mezzanine Preferred Stock (in shares) | 0 | 12,534,331 |
Convertible preferred stock, shares outstanding (in shares) | 0 | 12,534,331 |
Convertible preferred stock, liquidation preferences | $ 0 | $ 87,489,600 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 15,000,000 | 0 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 120,000,000 | 65,000,000 |
Common stock, shares issued (in shares) | 37,710,190 | 18,154,119 |
Common stock, shares outstanding (in shares) | 37,710,190 | 18,154,119 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenue: | ||||
Total revenue | $ 5,901 | $ 1,219 | $ 10,112 | $ 12,948 |
Operating expenses: | ||||
Research and development | 19,837 | 12,785 | 55,827 | 35,624 |
General and administrative | 1,622 | 1,481 | 4,621 | 4,584 |
Total operating expenses | 21,459 | 14,266 | 60,448 | 40,208 |
Loss from operations | (15,558) | (13,047) | (50,336) | (27,260) |
Other income (expense): | ||||
Interest expense, net | (4,428) | (2,670) | (10,284) | (3,407) |
Other income (expense), net | 0 | (70) | 5 | (54) |
Change in fair value of warrant liabilities | (24) | 0 | (24) | 0 |
Change in fair value of derivative liabilities | 0 | (3,476) | 2,651 | (3,476) |
Total other expense | (4,452) | (6,216) | (7,652) | (6,937) |
Loss before income tax expense | (20,010) | (19,263) | (57,988) | (34,197) |
Provision for income taxes | 0 | 900 | 0 | 898 |
Loss on equity method investment | 487 | 0 | 487 | 0 |
Net loss | $ (20,497) | $ (20,163) | $ (58,475) | $ (35,095) |
Net loss per share attributable to Inhibrx, Inc., basic and diluted (in dollars per share) | $ (0.77) | $ (1.11) | $ (2.78) | $ (1.93) |
Weighted-average shares of common stock outstanding, basic and diluted (in shares) | 26,750 | 18,154 | 21,019 | 18,154 |
License fee revenue | ||||
Revenue: | ||||
Total revenue | $ 5,826 | $ 794 | $ 10,032 | $ 8,826 |
Grant revenue | ||||
Revenue: | ||||
Total revenue | $ 75 | $ 425 | $ 80 | $ 4,122 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) - USD ($) $ in Thousands | Total | Convertible Preferred Stock | 2019 and 2020 Notes | 2019 Convertible Note | 2020 Convertible Note | COMMON STOCK | COMMON STOCKConvertible Preferred Stock | COMMON STOCK2019 and 2020 Notes | ADDITIONAL PAID-IN CAPITAL | ADDITIONAL PAID-IN CAPITALConvertible Preferred Stock | ADDITIONAL PAID-IN CAPITAL2019 and 2020 Notes | ADDITIONAL PAID-IN CAPITAL2019 Convertible Note | ADDITIONAL PAID-IN CAPITAL2020 Convertible Note | ACCUMULATED DEFICIT |
Beginning balance, preferred stock (in shares) at Dec. 31, 2018 | 10,815,000 | |||||||||||||
Beginning balance, preferred stock at Dec. 31, 2018 | $ 47,519 | |||||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||
Issuance of Mezzanine Preferred Stock (in shares) | 1,719,000 | |||||||||||||
Issuance of Mezzanine Preferred Stock | $ 11,988 | |||||||||||||
Ending balance, preferred stock (in shares) at Mar. 31, 2019 | 12,534,000 | |||||||||||||
Ending balance, preferred stock at Mar. 31, 2019 | $ 59,507 | |||||||||||||
Beginning balance (in shares) at Dec. 31, 2018 | 18,154,000 | |||||||||||||
Beginning balance at Dec. 31, 2018 | (57,643) | $ 2 | $ (39,790) | $ (17,855) | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stock-based compensation expense | 906 | 906 | ||||||||||||
Net loss | (3,847) | (3,847) | ||||||||||||
Ending balance (in shares) at Mar. 31, 2019 | 18,154,000 | |||||||||||||
Ending balance at Mar. 31, 2019 | $ (60,584) | $ 2 | (38,884) | (21,702) | ||||||||||
Beginning balance, preferred stock (in shares) at Dec. 31, 2018 | 10,815,000 | |||||||||||||
Beginning balance, preferred stock at Dec. 31, 2018 | $ 47,519 | |||||||||||||
Ending balance, preferred stock (in shares) at Sep. 30, 2019 | 12,534,000 | |||||||||||||
Ending balance, preferred stock at Sep. 30, 2019 | $ 59,507 | |||||||||||||
Beginning balance (in shares) at Dec. 31, 2018 | 18,154,000 | |||||||||||||
Beginning balance at Dec. 31, 2018 | (57,643) | $ 2 | (39,790) | (17,855) | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net loss | (35,095) | |||||||||||||
Ending balance (in shares) at Sep. 30, 2019 | 18,154,000 | |||||||||||||
Ending balance at Sep. 30, 2019 | $ (78,388) | $ 2 | (25,440) | (52,950) | ||||||||||
Beginning balance, preferred stock (in shares) at Dec. 31, 2018 | 10,815,000 | |||||||||||||
Beginning balance, preferred stock at Dec. 31, 2018 | $ 47,519 | |||||||||||||
Ending balance, preferred stock (in shares) at Dec. 31, 2019 | 12,534,331 | |||||||||||||
Ending balance, preferred stock at Dec. 31, 2019 | $ 59,507 | |||||||||||||
Beginning balance (in shares) at Dec. 31, 2018 | 18,154,000 | |||||||||||||
Beginning balance at Dec. 31, 2018 | $ (57,643) | $ 2 | (39,790) | (17,855) | ||||||||||
Ending balance (in shares) at Dec. 31, 2019 | 18,154,119 | 18,154,000 | ||||||||||||
Ending balance at Dec. 31, 2019 | $ (93,569) | $ 2 | (24,316) | (69,255) | ||||||||||
Beginning balance, preferred stock (in shares) at Mar. 31, 2019 | 12,534,000 | |||||||||||||
Beginning balance, preferred stock at Mar. 31, 2019 | $ 59,507 | |||||||||||||
Ending balance, preferred stock (in shares) at Jun. 30, 2019 | 12,534,000 | |||||||||||||
Ending balance, preferred stock at Jun. 30, 2019 | $ 59,507 | |||||||||||||
Beginning balance (in shares) at Mar. 31, 2019 | 18,154,000 | |||||||||||||
Beginning balance at Mar. 31, 2019 | (60,584) | $ 2 | (38,884) | (21,702) | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stock-based compensation expense | 925 | 925 | ||||||||||||
Beneficial conversion feature (reversal of unamortized BCF) | 11,500 | 11,500 | ||||||||||||
Net loss | (11,085) | (11,085) | ||||||||||||
Ending balance (in shares) at Jun. 30, 2019 | 18,154,000 | |||||||||||||
Ending balance at Jun. 30, 2019 | $ (59,244) | $ 2 | (26,459) | (32,787) | ||||||||||
Ending balance, preferred stock (in shares) at Sep. 30, 2019 | 12,534,000 | |||||||||||||
Ending balance, preferred stock at Sep. 30, 2019 | $ 59,507 | |||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stock-based compensation expense | 1,019 | 1,019 | ||||||||||||
Net loss | (20,163) | (20,163) | ||||||||||||
Ending balance (in shares) at Sep. 30, 2019 | 18,154,000 | |||||||||||||
Ending balance at Sep. 30, 2019 | $ (78,388) | $ 2 | (25,440) | (52,950) | ||||||||||
Beginning balance, preferred stock (in shares) at Dec. 31, 2019 | 12,534,331 | |||||||||||||
Beginning balance, preferred stock at Dec. 31, 2019 | $ 59,507 | |||||||||||||
Ending balance, preferred stock (in shares) at Mar. 31, 2020 | 12,534,000 | |||||||||||||
Ending balance, preferred stock at Mar. 31, 2020 | $ 59,507 | |||||||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 18,154,119 | 18,154,000 | ||||||||||||
Beginning balance at Dec. 31, 2019 | $ (93,569) | $ 2 | (24,316) | (69,255) | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stock-based compensation expense | 1,088 | 1,088 | ||||||||||||
Net loss | (20,093) | (20,093) | ||||||||||||
Ending balance (in shares) at Mar. 31, 2020 | 18,154,000 | |||||||||||||
Ending balance at Mar. 31, 2020 | $ (112,574) | $ 2 | (23,228) | (89,348) | ||||||||||
Beginning balance, preferred stock (in shares) at Dec. 31, 2019 | 12,534,331 | |||||||||||||
Beginning balance, preferred stock at Dec. 31, 2019 | $ 59,507 | |||||||||||||
Ending balance, preferred stock (in shares) at Sep. 30, 2020 | 0 | |||||||||||||
Ending balance, preferred stock at Sep. 30, 2020 | $ 0 | |||||||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 18,154,119 | 18,154,000 | ||||||||||||
Beginning balance at Dec. 31, 2019 | $ (93,569) | $ 2 | (24,316) | (69,255) | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net loss | $ (58,475) | |||||||||||||
Ending balance (in shares) at Sep. 30, 2020 | 37,710,190 | 37,710,000 | ||||||||||||
Ending balance at Sep. 30, 2020 | $ 91,729 | $ 4 | 219,455 | (127,730) | ||||||||||
Beginning balance, preferred stock (in shares) at Mar. 31, 2020 | 12,534,000 | |||||||||||||
Beginning balance, preferred stock at Mar. 31, 2020 | $ 59,507 | |||||||||||||
Ending balance, preferred stock (in shares) at Jun. 30, 2020 | 12,534,000 | |||||||||||||
Ending balance, preferred stock at Jun. 30, 2020 | $ 59,507 | |||||||||||||
Beginning balance (in shares) at Mar. 31, 2020 | 18,154,000 | |||||||||||||
Beginning balance at Mar. 31, 2020 | (112,574) | $ 2 | (23,228) | (89,348) | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stock-based compensation expense | 1,259 | 1,259 | ||||||||||||
Beneficial conversion feature (reversal of unamortized BCF) | $ 2,656 | $ 2,656 | ||||||||||||
Net loss | (17,885) | (17,885) | ||||||||||||
Ending balance (in shares) at Jun. 30, 2020 | 18,154,000 | |||||||||||||
Ending balance at Jun. 30, 2020 | $ (126,544) | $ 2 | (19,313) | (107,233) | ||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||
Issuance of shares in conversion of preferred shares (in shares) | (12,534,000) | |||||||||||||
Issuance of shares in conversion of preferred shares | $ (59,507) | |||||||||||||
Ending balance, preferred stock (in shares) at Sep. 30, 2020 | 0 | |||||||||||||
Ending balance, preferred stock at Sep. 30, 2020 | $ 0 | |||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stock-based compensation expense | 1,303 | 1,303 | ||||||||||||
Issuance of shares upon exercise of stock options | 4 | 4 | ||||||||||||
Issuance of shares in IPO (in shares) | 8,050,000 | |||||||||||||
Issuance of shares in IPO, net of issuance costs | 125,863 | $ 1 | 125,862 | |||||||||||
Issuance of shares in conversion of convertible securities (in shares) | 7,211,000 | 4,295,000 | ||||||||||||
Issuance of shares in conversion of convertible securities | $ 59,507 | $ 59,393 | $ 1 | $ 59,506 | $ 59,393 | |||||||||
Beneficial conversion feature (reversal of unamortized BCF) | $ (5,332) | $ (2,107) | $ (5,332) | $ (2,107) | ||||||||||
Reclassification of warrant liabilities to equity | 139 | 139 | ||||||||||||
Net loss | $ (20,497) | (20,497) | ||||||||||||
Ending balance (in shares) at Sep. 30, 2020 | 37,710,190 | 37,710,000 | ||||||||||||
Ending balance at Sep. 30, 2020 | $ 91,729 | $ 4 | $ 219,455 | $ (127,730) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Cash flows from operating activities | |||||||
Net loss | $ (20,497) | $ (20,093) | $ (20,163) | $ (3,847) | $ (58,475) | $ (35,095) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Depreciation and amortization | 300 | 500 | 754 | 926 | |||
Accretion of debt discount and non-cash interest expense | 10,046 | 3,199 | |||||
Stock-based compensation expense | 3,650 | 2,850 | |||||
Non-cash lease expense | 1,020 | 1,089 | |||||
Change in fair value of derivative liabilities | 0 | 3,476 | (2,651) | 3,476 | |||
Change in fair value of warrant liabilities | 24 | 0 | 24 | 0 | |||
Loss on equity method investment | 487 | 0 | 487 | 0 | |||
Loss on disposal of fixed assets | 0 | 69 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (482) | (1,680) | |||||
Receivables from related parties | (44) | 0 | |||||
Prepaid expenses and other current assets | 366 | (848) | |||||
Other non-current assets | 0 | (244) | |||||
Accounts payable | 11,605 | (3,014) | |||||
Accrued expenses and other current liabilities | 6,196 | 1,038 | |||||
Operating lease liability | (995) | (746) | |||||
Deferred revenue, current portion | (3,250) | 8,206 | |||||
Deferred revenue, non-current portion | (830) | 1,000 | |||||
Other non-current liabilities | 0 | (363) | |||||
Net cash used in operating activities | (32,579) | (20,137) | |||||
Cash flows from investing activities | |||||||
Purchase of fixed assets | (752) | (1,475) | |||||
Net cash used in investing activities | (752) | (1,475) | |||||
Cash flows from financing activities | |||||||
Proceeds from initial public offering, gross | 136,850 | 0 | |||||
Costs associated with initial public offering | (10,558) | 0 | |||||
Deferred offering costs paid | 0 | (1,158) | |||||
Proceeds from the issuance of convertible notes | 15,000 | 40,000 | |||||
Costs associated with the issuance of convertible notes | 0 | (2,470) | |||||
Proceeds from the issuance of debt | 9,958 | 0 | |||||
Payment of fees associated with debt | (86) | 0 | |||||
Proceeds from the Paycheck Protection Program loan | 1,875 | 0 | |||||
Repayment of principal on debt | (2,183) | (4,595) | |||||
Final payment on debt | (1,400) | 0 | |||||
Proceeds from the exercise of stock options | 4 | 0 | |||||
Proceeds from the issuance of preferred stock | 0 | 12,000 | |||||
Costs associated with the issuance of preferred stock | 0 | (12) | |||||
Net cash provided by financing activities | 149,460 | 43,765 | |||||
Net increase in cash and cash equivalents | 116,129 | 22,153 | |||||
Cash and cash equivalents at beginning of period | $ 11,540 | $ 2,103 | 11,540 | 2,103 | $ 2,103 | ||
Cash and cash equivalents at end of period | $ 127,669 | $ 24,256 | 127,669 | 24,256 | $ 11,540 | ||
Supplemental disclosure of cash flow information | |||||||
Cash paid for interest | 172 | 407 | |||||
Cash paid for income taxes | 0 | 976 | |||||
Supplemental schedule of non-cash investing and financing activities | |||||||
Conversion of preferred stock to common stock | 59,507 | 0 | |||||
Conversion of the 2019 Note and the 2020 Notes to common stock | 53,394 | 0 | |||||
Debt discount arising from convertible note beneficial conversion features and reversal of beneficial conversion features | 4,783 | (11,500) | |||||
Operating lease liabilities arising from obtaining right-of-use assets | 1,752 | 8,808 | |||||
Derivative liabilities | 735 | 900 | |||||
Debt discount related to derivative liabilities | (735) | (900) | |||||
Non-cash equity method investment | (487) | 0 | |||||
Initial public offering costs included in accounts payable and accrued expenses | 430 | 597 | |||||
Reclassification of warrant liabilities to equity | 139 | 0 | |||||
Warrant liabilities | 115 | 0 | |||||
Debt discount related to warrant liabilities | (115) | 0 | |||||
Payable for purchase of fixed assets | $ (46) | $ (22) |
ORGANIZATION AND SUMMARY OF SIG
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Inhibrx, Inc. (the “Company” or “Inhibrx”) is a clinical-stage biotechnology company focused on developing a broad pipeline of novel biologic therapeutic candidates. The Company combines a deep understanding of target biology with innovative protein engineering, proprietary discovery technologies, and an integrative approach to research and development to design highly differentiated therapeutic candidates. The Company’s current pipeline is focused on oncology and orphan diseases. Initial Public Offering On August 21, 2020, the Company completed its initial public offering (“IPO”) in which it sold 8,050,000 shares of common stock at an offering price of $17.00 per share. Proceeds from the IPO, net of underwriting discounts, commissions, and offering costs were $125.9 million. In addition, each of the following occurred in connection with the completion of the IPO: • the conversion of the 2019 Note and the 2020 Notes (each as defined below) into 4,294,603 shares of the Company’s common stock; • the conversion of all outstanding convertible preferred stock into 7,211,086 shares of the Company’s common stock; • the adjustment of an outstanding warrant to purchase convertible preferred stock into a warrant to purchase 7,354 shares of the Company’s common stock; and • the amendment and restatement of the Company’s certificate of incorporation, authorizing 120.0 million shares of common stock and 15.0 million shares of preferred stock. Reverse Stock Split On August 11, 2020 the Company effected a one-for-1.7382 reverse stock split of the Company’s common stock (the “Reverse Stock Split”). The par value and the authorized shares of the common stock were not adjusted as a result of the Reverse Stock Split. All issued and outstanding common stock and the conversion prices of the convertible preferred stock have been retroactively adjusted to reflect this Reverse Stock Split for all periods presented. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) related to an interim report on the Form 10-Q. The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All intercompany accounts and transactions have been eliminated in consolidation. The unaudited interim condensed financial statements reflect all adjustments which, in the opinion of management, are necessary for a fair statement of the results for the periods presented. All such adjustments are of a normal and recurring nature. The operating results presented in these unaudited interim condensed financial statements are not necessarily indicative of the results that may be expected for any future periods. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted. Accordingly, the accompanying unaudited interim financial statements should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2019, which are included in the Company’s final prospectus filed with the SEC pursuant to Rule 424(b)(4) on August 19, 2020 under the Securities Act of 1933, as amended (the “Securities Act”). Liquidity As of September 30, 2020, the Company had an accumulated deficit of $127.7 million and cash and cash equivalents of $127.7 million. From its inception and through September 30, 2020, the Company has devoted substantially all of its efforts to therapeutic drug discovery and development, conducting preclinical studies and clinical trials, enabling manufacturing activities in support of its therapeutic candidates, organizing and staffing the Company, establishing its intellectual property portfolio and raising capital to support and expand these activities. The Company believes that existing cash and cash equivalents, including the net proceeds from the IPO, will be sufficient to fund the Company’s operations for at least 12 months from the date of the filing of this Form 10-Q. The Company plans to finance its future cash needs through equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements. If the Company does raise additional capital through public or private equity or convertible debt offerings, the ownership interests of its existing stockholders will be diluted, and the terms of those securities may include liquidation or other preferences that adversely affect its stockholders’ rights. If the Company raises capital through additional debt financings, it may be subject to covenants limiting or restricting its ability to take specific actions, such as incurring additional debt or making certain capital expenditures. To the extent that the Company raises additional capital through strategic licensing, collaboration or other similar agreement, it may have to relinquish valuable rights to its therapeutic candidates, future revenue streams or research programs at an earlier stage of development or on less favorable terms than it would otherwise choose, or to grant licenses on terms that may not be favorable to the Company. There can be no assurance as to the availability or terms upon which such financing and capital might be available in the future. If the Company is unable to secure adequate additional funding, it will need to reevaluate its operating plan and may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, delay, scale back or eliminate some or all of its development programs, or relinquish rights to its technology on less favorable terms than it would otherwise choose. These actions could materially impact its business, financial condition, results of operations and prospects. Use of Estimates The preparation of these unaudited condensed consolidated financial statements in conformity with GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expense and the disclosure of contingent assets and liabilities in the Company’s financial statements and accompanying notes. The Company’s most significant estimates relate to evaluation of embedded derivative instruments and beneficial conversion features within convertible notes, whether revenue recognition criteria have been met, accounting for development work and preclinical studies and clinical trials, determining the assumptions used in measuring stock-based compensation, the incremental borrowing rate estimated in relation to the Company’s operating lease, and valuation allowances for the Company’s deferred tax assets. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. The Company’s actual results may differ from these estimates under different assumptions or conditions. Fair Value of Financial Instruments The Company’s financial instruments consist principally of accounts receivable, accounts payable, accrued expense, its current loan and security agreement (the “2020 Loan Agreement”) with Oxford Finance LLC (“Oxford”) and its former loan and security agreement, as amended (the “2015 Loan Agreement”), which has been terminated, warrants, and derivative instruments as applicable. The carrying amounts of financial instruments such as accounts receivable, accounts payable, accrued expense and convertible notes approximate their related fair values due to the short-term nature of these instruments. The Company’s derivative instruments and warrants are carried at fair value based on unobservable market inputs. Cash and Cash Equivalents Cash and cash equivalents are comprised of cash held in financial institutions including readily available checking and money market accounts. Concentrations of Credit Risk The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash balances due to the financial condition of the depository institution in which those deposits are held. The Company continually evaluates its accounts receivable for all outstanding third-party balances to determine the potential exposure to a concentration of credit risk. The Company’s major third-party contracting parties, some of which account for significant balances in both accounts receivable and revenue, are generally large, credit-worthy biotechnology companies and government bodies. The Company assesses the collectability of accounts receivable through a review of its current aging, as well as an analysis of its historical collection rate, general economic conditions, and credit status of these third parties. As of September 30, 2020 and December 31, 2019, all outstanding accounts receivable were deemed to be fully collectible, and therefore, no allowance for doubtful accounts was recorded. The Company currently depends on third-party suppliers for key materials and services used in its research and development, as well as manufacturing processes, and is subject to certain risks related to the loss of these third-party suppliers or their inability to supply the Company with adequate materials and services. In August 2018, the Company entered into a strategic alliance with WuXi Biologics (Hong Kong), Limited, (“WuXi Biologics”) pursuant to which the Company agreed, for three years and subject to certain conditions, to exclusively use WuXi Biologics to manufacture its therapeutic candidates on a project-by-project basis. The Company does not control the manufacturing processes of the contract development and manufacturing organizations (“CDMOs”) with whom it contracts, including WuXi Biologics, and is dependent on these third parties for the production of its therapeutic candidates in accordance with relevant regulations (such as current Good Manufacturing Practices, “cGMP”), which includes, among other things, quality control, quality assurance and the maintenance of records and documentation. Dividends As of September 30, 2020, the Company has never declared or paid any dividends on its common stock. The Company currently intends to retain available cash for funding operations; therefore, it does not expect to pay any dividends in the foreseeable future. Additionally, the 2020 Loan Agreement with Oxford, limits, among other things, the Company’s ability to pay dividends and make certain other payments. Any future determination to pay dividends on the Company’s common stock will be at the discretion of the Company’s board of directors and will depend upon, among other factors, the results of operations, financial condition, capital requirements, contract restrictions, business prospects and other factors the Company’s board of directors may deem relevant. Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation. Depreciation is provided on a straight-line basis over the estimated useful lives of the assets. The Company estimates useful lives as follows: • machinery and equipment: three • furniture and fixtures: three • computer software: four Amortization of leasehold improvements is provided on a straight-line basis over the shorter of their estimated useful lives or the lease term. The costs of additions and betterments are capitalized, and repairs and maintenance costs are expensed in the periods incurred. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss is recognized when estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition are less than its carrying amount. If such assets are considered impaired, the amount of the impairment loss recognized is measured as the amount by which the carrying value of the asset exceeds the fair value of the asset, fair value being determined based upon future cash flows or appraised values, depending on the nature of the asset. The Company recognized no impairment losses during any of the periods presented within its condensed consolidated financial statements. Leases The Company has two existing leases for its corporate headquarters in La Jolla, California. Its first lease commenced in June 2018. In May 2019, the Company signed an amendment to its lease agreement to expand the Company’s facilities, which commenced in January 2020. This amendment is accounted for as a separate lease. Leases are reviewed and classified as operating or financing leases at commencement. The Company’s existing leases are classified as operating leases. Effective January 1, 2019, the Company adopted Accounting Standards Update (“ASU”) No. 2016-02, Leases . For the long-term operating lease of its corporate headquarters, the Company recognized a right-of-use asset and lease liability on its condensed consolidated balance sheet. The lease liability is determined as the present value of future lease payments using an estimated incremental borrowing rate that the Company would have to pay to borrow equivalent funds on a collateralized basis at the lease commencement date. The right-of-use asset is based on the liability adjusted for any prepaid or deferred rent. The lease term at the commencement date is determined by considering whether renewal options and termination options are reasonably assured of exercise. The Company has elected to exclude from its condensed consolidated balance sheets recognition of leases having a term of 12 months or less (short-term leases) and has elected not to separate lease components and non-lease components for its long-term operating leases. Rent expense for the operating leases are recognized on a straight-line basis over the lease term and is included in operating expense in the condensed consolidated statements of operations for all periods presented. Agreements are reviewed at inception to determine if they contain a lease. Equity Method Investment The Company uses the equity method of accounting for equity investments in companies if the investment provides the ability to exercise significant influence, but not control, over operating and financial policies of the investee. As discussed in Note 8, the Company received an equity investment in the form of a 10% equity interest as consideration in a series of agreements with Phylaxis BioScience, LLC (“Phylaxis”), which is accounted for as an equity method investment. The Company's proportionate share of the net income or loss of these companies is included as loss in equity method investment in the condensed consolidated statement of operations. Judgment regarding the level of influence over each equity method investment includes considering key factors such as the Company’s ownership interest, representation on the board of directors, legal form of the investee (e.g. limited liability corporation), participation in policy-making decisions, and material purchase and sale transactions. As of September 30, 2020, the Company’s equity method investment has been written down to zero as a result of the allocation of the Company’s share of losses of the investee. Derivative Liabilities As discussed in Note 5, the convertible promissory note (the “2019 Note”) issued in May 2019 to DRAGSA 50, LLC, an entity affiliated with Viking Global Investors LP (“Viking”) and the convertible promissory notes (the “2020 Notes”) issued in April 2020 to Viking and certain other investors contained embedded features that provided multiple settlement alternatives. Certain of these settlement features provided the noteholders with a right to a fixed number of the Company’s shares upon conversion of the note. Other settlement features provided the noteholders the right or the obligation to receive cash or a variable number of shares upon the completion of a capital raising transaction, change of control, qualified IPO (as defined in the 2019 Note and the 2020 Notes), or default of the Company. The Company evaluated each settlement alternative within the 2019 Note and the 2020 Notes under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 815-15, Embedded Derivatives and ASC Topic 815-40, Contracts in Entity’s Own Equity and determined certain of the settlement features would be accounted for as redemption features meeting the requirements for separate accounting as a single, compound derivative instrument. This single, compound derivative instrument was accounted for as a liability at its estimated fair value as of the date of issuance, and then subsequently remeasured to fair value as of each balance sheet date, with the related remeasurement adjustment being recognized as a component of change in fair value of derivative liabilities in the condensed consolidated statements of operations. During August 2020, the Company consummated its IPO, resulting in the conversion of the 2019 Note and the 2020 Notes into shares of the Company’s common stock. As of September 30, 2020, the derivative liabilities no longer exist. Warrant Liabilities As discussed in Note 3, in conjunction with the 2020 Loan Agreement with Oxford, the Company issued warrants for the purchase of: 1) its preferred stock if the Company remained privately-held or 2) common stock upon the successful completion of an IPO prior to December 31, 2020. Upon the issuance of the warrants in July 2020, pursuant to ASC Topic 480, the warrants were accounted for as liabilities and measured at their estimated fair value as of the date of issuance based on the potential conversion into preferred stock. During August 2020, upon consummation of the Company’s IPO, the warrants were deemed to be issued for the purchase of common stock and were no longer accounted for as liabilities. The change in fair value was recognized as a component of change in fair value of warrant liabilities in the condensed consolidated statements of operations during the three and nine months ended September 30, 2020. Fair Value Measurements The Company determines the fair value measurements of applicable assets and liabilities based on a three-tier fair value hierarchy established by accounting guidance and prioritizes the inputs used in measuring fair value. These tiers include: • Level 1 - Quoted prices in active markets for identical assets or liabilities. • Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, 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 that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. The 2019 Note and the 2020 Notes contained embedded derivative liabilities (see Note 5). The 2020 Loan Agreement contained warrant liabilities (see Note 3). Prior to the completion of the IPO in August 2020, these were classified within Level 3 of the hierarchy, since they were valued by using inputs that were unobservable in the market. Upon the consummation of the IPO in August 2020 and as of September 30, 2020, the derivative liabilities and warrant liabilities no longer existed. The following table presents the Company’s financial liability that was measured at fair value as of December 31, 2019 (in thousands): LEVEL 1 LEVEL 2 LEVEL 3 TOTAL As of December 31, 2019 Derivative liability $ — $ — $ 1,916 $ 1,916 Prior to the completion of the IPO in August 2020, the Company’s liabilities that were measured at fair value on a recurring basis using significant unobservable inputs (Level 3) included the derivative liabilities related to the 2019 Note and the 2020 Notes and the warrants issued with the 2020 Loan Agreement. The following table provides a reconciliation of financial instruments measured at fair value using Level 3 unobservable inputs for the nine months ended September 30, 2020 (in thousands): Balance as of December 31, 2018 $ — Establishment of derivative liability on the 2019 Note 900 Change in fair value of derivative liability 1,016 Balance as of December 31, 2019 $ 1,916 Establishment of derivative liability on the 2020 Notes 735 Establishment of warrant liabilities on the 2020 Loan Agreement 115 Change in fair value of derivative liabilities on the 2019 and 2020 Notes (2,651) Change in fair value of warrant liabilities 24 Reclassification of warrant liabilities into equity (139) Balance as of September 30, 2020 $ — The fair value of the Company’s derivative liabilities categorized in Level 3 of the fair value hierarchy as of December 31, 2019 was determined based upon an independent third-party valuation report which used a lattice model. The valuation report utilized unobservable inputs, including the discount rate, management’s assessment of the probability of various underlying events triggering the conversion of the Company’s 2019 Note and the 2020 Notes (as discussed in Note 5), such as an IPO, financing, or extraordinary event, and the current valuation of the Company through an independent third-party valuation report. The warrant liabilities were valued using a Black-Scholes model upon issuance. As of September 30, 2020, the derivative liabilities no longer exist as a result of the conversion of the 2019 Note and the 2020 Notes upon Qualified IPO. Additionally, as of September 30, 2020, the warrant liabilities have been reclassified into equity after the Oxford warrants became exercisable for common stock subsequent to the Company’s IPO. Deferred Financing Costs and Other Debt-Related Costs Deferred financing costs are capitalized, recorded as an offset to the Company’s debt balances and amortized as interest expense over the term of the associated debt instrument using the effective interest method, pursuant to ASC Topic 835-30, Imputation of Interest . If the maturity of the debt is accelerated as a result of default or early debt repayment, the amortization would then be accelerated. Amounts paid related to debt financing activities are presented on the condensed consolidated balance sheet as a direct deduction from the debt liability. Deferred Offering Costs The Company capitalizes costs that are directly associated with equity financings until such financings are consummated at which time such costs are recorded against the gross proceeds of the offering. Should an in-process equity financing be abandoned, the deferred offering costs will be expensed immediately as a charge to operating expenses in the statement of operations and comprehensive loss. Legal, accounting, and filing fees related directly to the Company’s IPO were capitalized as deferred IPO costs to be offset against proceeds upon the consummation of the IPO within stockholders’ equity (deficit). In August 2020, the Company completed its IPO and offset $11.0 million of IPO costs against the proceeds. As of September 30, 2020 and December 31, 2019, no deferred IPO costs were capitalized on the Company’s condensed consolidated balance sheets. Revenue Recognition To date, the Company has generated revenue from its license and collaboration agreements with partners, as well as from grants from government agencies such as the National Institutes of Health (“NIH”) and the Congressionally Directed Medical Research Program (“CDMRP”) funded through the Department of Defense (“DoD”), as well as from private not-for-profit organizations including Combating Antibiotic Resistant Bacteria Biopharmaceutical Accelerator (“CARB-X”). Payments received from customers are included in deferred revenue, allocated between current and non-current, on the condensed consolidated balance sheet until all revenue recognition criteria are met. In accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), the Company recognizes revenue when, or as, the promised goods or services are transferred to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those services. To determine revenue recognition for arrangements the Company concludes are within the scope of ASC Topic 606, the Company performs the following five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligation(s) in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligation(s) in the contract; and (5) recognize revenue when (or as) the performance obligation(s) are satisfied. At contract inception, the Company assesses the goods or services promised within each contract, assesses whether each promised good or service is distinct and identifies those that are performance obligations. The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when, or as, the performance obligation is satisfied. Collaborative Research, Development, and License Agreements The Company enters into collaborative agreements with partners that typically include one or more of the following: (1) license fees; (2) nonrefundable up-front fees; (3) payments for reimbursement of research costs; (4) payments associated with achieving specific development, regulatory, or commercial milestones; and (5) royalties based on specified percentages of net product sales, if any. At the initiation of an agreement, the Company analyzes whether each unit of account results in a contract with a customer under ASC Topic 606 or in an arrangement with a collaborator subject to guidance under ASC Topic 808, Collaborative Arrangements (“ASC 808”). The Company’s licensing arrangements are typically for functional intellectual property as it exists at a point in time, being the time that the license agreement is executed. The Company typically does not have an ongoing performance obligation to support or maintain the licensed intellectual property. The Company considers a variety of factors in determining the appropriate estimates and assumptions under these arrangements, such as whether the elements are distinct performance obligations, whether there are observable stand-alone prices, and whether any licenses are functional or symbolic. The Company evaluates each performance obligation to determine if it can be satisfied and recognized as revenue at a point in time or over time. Typically, license fees, non-refundable upfront fees, and funding of research activities are considered fixed, while milestone payments are identified as variable consideration which must be evaluated to determine if it is constrained and, therefore, excluded from the transaction price. The Company estimates the amount of variable consideration using the most likely amount, as milestone payments typically only have two possible outcomes. The Company recognizes revenue for sales-based royalty promised in exchange for the license of intellectual property only when the subsequent sale occurs. In the case of an agreement which provides the partner with an option to license a therapeutic or therapeutic candidate in the future, the Company evaluates whether this option represents a material right at the inception of the agreement. If determined to be a material right, the Company will consider the option a separate performance obligation. The Company has historically concluded that the option to grant a license in the future are not material rights as they are contingent upon future events which may not occur. When an option is exercised, the Company will identify any separate performance obligations. The Company may allocate transaction price using a number of methods including estimating standalone selling price of performance obligations and using the residual approach when the standalone selling price of the license is highly variable or uncertain, and observable standalone selling prices exist for the other goods or services promised in the contract. Grant Revenue Since inception, the Company has been awarded multiple grants from the NIH, one grant from the CDMRP funded through the DoD, as well as one grant from CARB-X. With respect to revenue derived from reimbursement of direct, out-of-pocket expenses for research and development costs associated with these grants, where the Company acts as a principal with discretion to choose suppliers, bears credit risk, and performs part of the services required in the transaction, the Company records revenue for the gross amount of the reimbursement. The costs associated with these reimbursements are reflected as a component of research and development expense in the condensed consolidated statements of operations. Since there is no transfer of control of goods or services to the granting entities, the granting entities do not meet the definition of a “customer” as defined by ASC Topic 606 and therefore, these government grants and private not-for-profit institution grants are not within the scope of ASC Topic 606. Since the Company has concluded that these grants do meet the definition of a contribution and are indeed non-reciprocal transactions, the adoption of ASC Topic 606 had no impact on the Company’s accounting for grant revenue from governmental agencies or private institutions not considered customers. Revenue from these grants are based upon internal costs incurred that are specifically covered by the grant, plus an additional rate that provides funding for overhead expenses. Revenue is recognized as the Company incurs expenses related to the grant which is consistent with the concept of transfer of control of a service over time under ASC Topic 606. Research and Development and Clinical Trial Accruals Research and development costs are expensed as incurred and include the cost of compensation and related expenses, as well as expenses for third parties who conduct research and development on the Company’s behalf, pursuant to development and consulting agreements in place. The Company’s preclinical studies and clinical trials are performed by third party contract research organizations (“CROs”) and/or clinical investigators. The Company also engages with CDMOs for clinical supplies and manufacturing scale-up activities related to its therapeutic candidates. Invoicing from these third parties may be monthly based upon services performed or based upon milestones achieved. The Company accrues these expenses based upon its assessment of the status of each clinical trial and the work completed, and upon information obtained from the CROs and CDMOs. The Company’s estimates are dependent upon the timeliness and accuracy of data provided by the CROs and CDMOs regarding the status and cost of the studies. Costs incurred related to the Company’s purchases of in-process research and development for early-stage products or products that are not commercially viable and ready for use, or have no alternative future use, are charged to expense in the period incurred. Costs incurred related to the licensing of products that have not yet received regulatory approval to be marketed, or that are not commercially viable and ready for use, or have no alternative future use, are charged to expense in the period incurred. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income taxes are recorded for temporary differences between financial stat |
OTHER FINANCIAL INFORMATION
OTHER FINANCIAL INFORMATION | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
OTHER FINANCIAL INFORMATION | OTHER FINANCIAL INFORMATION Prepaid Expense and Other Current Assets Prepaid expense and other current assets were comprised of the following (in thousands): AS OF SEPTEMBER 30, AS OF DECEMBER 31, 2020 2019 (unaudited) Outside research and development services $ 2,245 $ 3,207 Other 972 376 Prepaid expense and other current assets $ 3,217 $ 3,583 Property and Equipment, Net Property and equipment, net were comprised of the following (in thousands): AS OF SEPTEMBER 30, AS OF DECEMBER 31, 2020 2019 (unaudited) Machinery and equipment $ 5,085 $ 4,723 Leasehold improvements 441 344 Furniture and fixtures 498 317 Construction in process 350 229 Total property and equipment 6,374 5,613 Less: accumulated depreciation and amortization (3,100) (2,383) Property and equipment, net $ 3,274 $ 3,230 Depreciation and amortization expense totaled $0.3 million and $0.5 million for the three months ended September 30, 2020 and 2019, respectively, and $0.8 million and $0.9 million for the nine months ended September 30, 2020 and 2019, respectively. Accrued Expenses Accrued expenses were comprised of the following (in thousands): AS OF SEPTEMBER 30, AS OF DECEMBER 31, 2020 2019 (unaudited) Accrued research and development $ 9,866 $ 3,414 Accrued compensation expense 740 813 Professional fees 260 313 Other 171 292 Accrued expenses $ 11,037 $ 4,832 |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Excluding amounts owed pursuant to the 2019 Note, the 2020 Notes, and the PPP Loan (defined below), the Company’s debt balance as of September 30, 2020 and December 31, 2019 consisted of the following under the 2015 Loan Agreement and the 2020 Loan Agreement. 2015 Loan Agreement As of September 30, 2020, the Company had no outstanding balances under the 2015 Loan Agreement. As of March 31, 2020, the Company had repaid its Oxford Term Loans under the 2015 Loan Agreement in full, including all principal balances, accrued interest, and the $1.4 million final payment. As of December 31, 2019, the Company’s outstanding debt balance under the 2015 Loan Agreement consisted of the following (in thousands). AS OF DECEMBER 31, 2019 Term A $ 831 Term B 893 Term C 930 Term D 930 Add: debt discount (21) Total debt 3,563 Less: Current portion, including debt discount (3,563) Long-term debt, including debt discount $ — On March 15, 2015, the Company entered into the 2015 Loan Agreement, pursuant to which Oxford agreed, subject to certain conditions, to make term loans to the Company in four $5.0 million installments for an aggregate of $20.0 million. The term loans were made on the following dates: (1) Term A: March 31, 2015; (2) Term B: September 9, 2016; (3) Term C: December 22, 2016; and (4) Term D: December 22, 2016. The proceeds from these loans were designated for working capital and general business purposes. Pursuant to the terms of the 2015 Loan Agreement, Oxford had a senior-secured lien on all of the Company’s current and future assets, other than its intellectual property. Oxford also had the right to declare the term loan immediately due and payable in an event of default under the 2015 Loan Agreement, which includes, among other things, a material adverse change in the Company’s business, operations, or financial condition or a material impairment in the prospect of repayment of the term loan. Throughout the life of the 2015 Loan Agreement, the Company was in compliance with all covenants under the 2015 Loan Agreement and has not received any notification or indication from Oxford of an intent to declare the loan due prior to maturity. Each term loan bore interest at the following annual rate: (1) Term A: 8.0%; (2) Term B: 8.6%; (3) Term C: 8.7%; and (4) Term D: 8.7%. The repayment schedule provided for interest-only payments in arrears until May 2016, followed by consecutive equal monthly payments of principal and interest in arrears through the maturity date, which was March 31, 2020 (the “Maturity Date”) for all four term loans. The Company had the option to prepay the outstanding balance of the term loans in full prior to the Maturity Date, subject to a prepayment fee of up to 3.0%. Upon repayment of each term loan, the Company was also required to make a final payment to Oxford equal to 7.0% of the original principal amount of each term loan. This final payment of $1.4 million was accreted over the life of the 2015 Loan Agreement using the effective interest method. In conjunction with the Company’s issuance of its first and second tranches of debt, Oxford also received 33,650 profit interest units (“PIUs”), which had a per unit value of $3.50, for a total value of $0.1 million. This was recorded as a debt discount and is being amortized using the effective interest method. The PIUs issued to Oxford were converted into 33,889 shares of the Company’s common stock in connection with the Company’s merger with various affiliated entities in April 2018, in which the Company was the surviving corporation. The Company’s interest expense related to the Oxford term loans for the three months ended September 30, 2020 and 2019 was $0 and $0.1 million, respectively, and for the nine months ended September 30, 2020 and 2019 was $0.04 million and $0.6 million, respectively. Interest expense is calculated using the effective interest method and is inclusive of non-cash amortization of the debt discount and accretion of the final payment. 2020 Loan Agreement As of September 30, 2020, the Company’s outstanding debt balance under the 2020 Loan Agreement consisted of the following (in thousands). AS OF SEPTEMBER 30, 2020 Term loan $ 10,700 Add: debt discount (879) Total debt 9,821 Less: Current portion, including debt discount — Long-term debt, including debt discount $ 9,821 As of September 30, 2020, the total future minimum payments, which consist of the future contractual principal and final fee payments, on the Company’s debt are as follows (in thousands): AS OF SEPTEMBER 30, 2020 2020 $ — 2021 — 2022 1,667 2023 5,000 2024 4,033 Total future minimum payments $ 10,700 Less: unamortized debt discount $ (879) Total debt $ 9,821 On July 15, 2020, the Company entered into the 2020 Loan Agreement with Oxford, pursuant to which it received $10.0 million in gross proceeds, net of $0.1 million of debt issuance costs (the “Term Loan”). The outstanding Term Loan will mature on August 1, 2024 (the “Maturity Date”) and bears interest at a floating per annum rate equal to (1) 8.95% plus (2) the greater of (i) the 30 day U.S. Dollar LIBOR rate reported in The Wall Street Journal on the last business day of the month that immediately precedes the month in which the interest will accrue, and (ii) 1.00%. The repayment schedule provides for interest-only payments beginning on September 1, 2020 and continuing for 24 months thereafter. The interest-only period is followed by 24 months of equal payments of principal and interest. Upon the Maturity Date, a final payment of 7.0% of the original principal amount will be due to Oxford. This final payment of $0.7 million will be accreted over the life of the 2020 Loan Agreement using the effective interest method. The Company has the option to prepay the outstanding balance of the Term Loan in full prior to the Maturity Date, subject to a prepayment fee ranging from 1.0% to 3.0%, depending on the timing of the prepayment. The Company plans to use the proceeds from the Term Loan solely for working capital and to fund its general business requirements. Its obligations under the Loan Agreement are secured by a first priority security interest of substantially all of the Company’s assets, other than its intellectual property. The 2020 Loan Agreement includes customary events of default, including instances of a material adverse change in the Company’s operations, that may require prepayment of the outstanding Term Loan. Concurrently with the debt issuance, the Company issued to Oxford warrants to purchase shares of the Company’s capital stock equal to 1.25% of the funded amount, or $125,000. Upon issuance, the warrants were exercisable for preferred stock and were classified as liabilities pursuant to Topic ASC 480 at their fair value of $0.12 million. Upon |
PPP LOAN
PPP LOAN | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
PPP LOAN | PPP LOAN On March 27, 2020, the U.S. federal government enacted the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). The CARES Act includes a provision for a Paycheck Protection Program (“PPP”) administered by the U.S. Small Business Administration (“SBA”) and further amended by the Paycheck Protection Program Flexibility Act of 2020 (“PPP Flexibility Act”), which was enacted on June 5, 2020. See Note 11 for further details regarding other provisions of the CARES Act. Under the PPP, the Company was approved for a loan pursuant to the PPP program (the “PPP Loan”) in the amount of $1.9 million and received the funds on May 11, 2020. The application for these funds required the Company to certify in good faith that current economic uncertainty made the loan request necessary to support the ongoing operations of the Company. The Company was also required to certify that the loan funds would be used to retain workers and maintain payroll or make mortgage payments, lease payments, and utility payments. The PPP Loan has a two-year term and bears interest at a rate of 1.0% per annum. Under the terms of the CARES Act, the Company was eligible to apply for and be granted forgiveness for all or a portion of the PPP Loan. Such forgiveness, if any, would have been determined, subject to limitations, based on the use of loan proceeds for payroll costs, rent and utility costs and provided that only a portion of the use of proceeds are for non-payroll costs. The unforgiven portion of the PPP Loan was eligible to be repaid by the Company at any time prior to maturity with no prepayment penalty. Loan recipients may elect an eight week or 24 week forgiveness period and the repayment period begins on the date which the amount of forgiveness is determined. In the event that a loan recipient has not applied for forgiveness within 10 months of the end of its covered forgiveness period, the loan recipient must begin making principal and interest payments on that date. During the third quarter of 2020, the Company determined that it would not seek forgiveness of the PPP Loan and would repay the loan in full during the fourth quarter of 2020. As a result, as of September 30, 2020, the full amount of the PPP Loan of $1.9 million was classified as current debt within the Company’s condensed consolidated balance sheets. Interest expense related to the PPP loan for the three and nine months ended September 30, 2020 was approximately $4,000 and $7,000, respectively. Interest expense was calculated using the effective interest method. On October 2, 2020, the Company repaid the loan in full plus all interest accrued during the period outstanding. See Note 12 for further details regarding the repayment. |
CONVERTIBLE PROMISSORY NOTES
CONVERTIBLE PROMISSORY NOTES | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE PROMISSORY NOTES | CONVERTIBLE PROMISSORY NOTES In May 2019, the Company issued the 2019 Note in the aggregate principal amount of $40.0 million to Viking in a private placement transaction. The 2019 Note began to accrue interest in February 2020 at a rate of 1.5% per month. In April 2020, the Company issued the 2020 Notes in the aggregate principal amount of $15.0 million to Viking and certain other investors in a private placement transaction. Upon issuance, the 2020 Notes accrued interest at a rate of 1.0% per month. The 2019 Note and the 2020 Notes were to mature on the earlier of (1) March 31, 2022; (2) upon the consummation of certain potential settlement events (each as defined in the 2019 Note and the 2020 Notes); or (3) the time at which the balance of the 2019 Note and the 2020 Notes is due and payable upon an Event of Default (the “Maturity Date”). Conversion Upon Qualified IPO On August 21, 2020, the Company completed a qualified IPO, which was defined as the completion of an IPO with a Company valuation above $400.0 million (“Qualified IPO”). As defined, a Qualified IPO triggered the automatic conversion and settlement of the aggregate outstanding principal amount plus accrued interest to date under the 2019 Note and the 2020 Notes into shares of the Company’s common stock at the lesser of (i) a conversion price equal to 90% of the IPO price per share and (ii) a fixed price based on a specified valuation. As of the conversion date, accrued interest expense for the 2019 Note and the 2020 Notes was $3.7 million and $0.7 million, respectively for an aggregate total balance of $43.7 million and $15.7 million, respectively. Based on a $400.0 million valuation, the 2019 Note converted at the fixed price of $14.35 per share, resulting in the issuance of 3,046,467 shares of common stock to the holder. Based on a $350.0 million valuation, the 2020 Notes converted at a fixed price of $12.56 per share, resulting in the issuance of 1,248,136 shares of common stock to the holders. The conversion of the 2019 Note and the 2020 Notes were evaluated for contingent beneficial conversion features (“BCF”) under ASC Topic 470-20, Debt With Conversion and Other Options . Since the effective conversion prices of both the 2019 Note and the 2020 Notes exceeded the relative fair value of the price per share at the commitment date of the 2019 Note and the 2020 Notes, including the paid-in-kind interest, there was no intrinsic value within the conversion feature. As a result, no additional BCF was recorded upon conversion of the 2019 and the 2020 Notes. Derivative Liabilities The terms of the 2019 Note and the 2020 Notes contained alternative conversion options to the Qualified IPO upon the consummation of certain events, each of which had its own conversion prices and terms. For instance, upon a maturity date conversion, upon the election of the holder, the note would have converted and settled into shares of the Company’s then-most senior equity securities at the time of such maturity date conversion at the lesser of (i) a conversion price equal to 90% of the price per share to be received by the then-most senior equity securities and (ii) a fixed price based on a specified valuation. Upon issuance of each of the 2019 Note and the 2020 Notes and prior to conversion under the IPO, the Company evaluated each settlement alternative within the 2019 Note and the 2020 Notes under ASC Topic 815-15, Embedded Derivatives and ASC Topic 815-40, Contracts in Entity’s Own Equity, in order to determine if it required bifurcation as a derivative instrument. The Company determined certain settlement features qualified as conversion features not meeting the requirements for separate accounting as embedded derivatives, while others qualified as redemption features meeting the requirements for separate accounting which were accounted for as derivative instruments. Upon issuance of the 2019 Note on May 20, 2019, the estimated fair value of the bifurcated compound liability was approximately $0.9 million, which was recorded as a derivative liability with a corresponding reduction to the debt discount on the condensed consolidated balance sheets. The 2019 Note was amended during April 2020 to align the maturity date and certain other provisions with the 2020 Notes. During the second quarter of 2020, the Company assessed the amendment and determined it should be treated as a modification. Since there was no change in the fair value of the embedded conversion options as of the modification date, no change in the carrying amount of the convertible debt instrument was recognized. Upon issuance of the 2020 Notes on April 6, 2020, the estimated fair value of the bifurcated compound liability was approximately $0.7 million, which was recorded as a derivative liability with a corresponding reduction to the debt discount on the condensed consolidated balance sheets. The Company engaged a third-party valuation specialist in order to assess the fair value of the derivative liability as of December 31, 2019, which was determined based upon significant inputs not observable in the market, including the discount rate, management’s assessment of the probability of various underlying events triggering the conversion of the Company’s notes, such as an IPO, financing or extraordinary event, as well as the current valuation of the Company as determined by an independent third-party’s valuation report. The fair value of the derivative liability at December 31, 2019 was $1.9 million. Changes in the probability of each embedded redemption feature drove changes in the fair value of the derivative liabilities and had a corresponding impact on the Company’s net loss. During the second quarter of 2020, the fair value of the derivative was determined to be zero based upon the expected conversion of the notes via an embedded conversion feature which did not meet the definition of a derivative. Upon conversion of the 2019 Note and the 2020 Notes in August 2020 upon completion of the Company’s IPO, the derivative liabilities were extinguished. No additional expense was recorded at extinguishment since the derivative liabilities had already been assessed to have zero value. During the nine months ended September 30, 2020, the Company recorded other income $2.7 million related to changes in fair value of derivative liabilities in the condensed consolidated statements of operations. Debt Discount Prior to conversion, the Company also evaluated the 2019 Note and the 2020 Notes for BCFs under ASC Topic 470-20, Debt With Conversion and Other Options . The Company determined that the maturity date conversion feature met the definition of a BCF since the embedded conversion option was in-the-money at inception and was fixed and determinable upon execution. Upon issuance of the 2019 Note during the second quarter of 2019, the Company recorded $11.5 million as a debt discount with a corresponding entry to additional paid-in-capital on its condensed consolidated balance sheet to record the BCF the 2019 Note. Additionally, at issuance in May 2019, the Company recorded a debt discount which consisted of $0.9 million related to the establishment of the derivative liability and $2.5 million related to debt issuance costs on the 2019 Note. Upon issuance of the 2020 Notes during the second quarter of 2020, the Company recorded $2.7 million as a debt discount with a corresponding entry to additional paid-in-capital on its condensed consolidated balance sheets to record the BCF on the 2020 Notes. Additionally, the Company recorded a debt discount of $0.7 million related to the establishment of the derivative liability on the 2020 Notes. Prior to conversion, the debt discounts were amortized over the life of the notes. Amortization of the debt discount from inception of the 2019 Note until conversion of the Notes upon IPO was $8.7 million. At the time of conversion, the 2019 and the 2020 Notes had unamortized discounts of $6.9 million and $2.7 million, respectively. Upon conversion of the 2019 Note and the 2020 Notes, the Company remeasured the intrinsic value of the BCFs which resulted in a reversal of the remaining unamortized discounts associated with the BCFs, resulting in a $7.4 million impact to additional paid-in-capital. Additionally, the Company accelerated the unamortized debt discounts related to the debt issuance costs and the derivative liabilities, resulting in a $2.2 million charge to interest expense. As of December 31, 2019, the Company’s 2019 Note and the 2020 Notes balance, net of discount, consisted of the following (in thousands): AS OF DECEMBER 31, 2019 Principal amount $ 40,000 Unamortized debt discounts $ (9,633) Convertible note, net $ 30,367 |
STOCKHOLDERS_ EQUITY (DEFICIT)
STOCKHOLDERS’ EQUITY (DEFICIT) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY (DEFICIT) | STOCKHOLDERS’ EQUITY (DEFICIT) Amended and Restated Certificate of Incorporation On August 21, 2020 upon completion of the IPO, the Company’s certificate of incorporation was amended and restated to authorize 120,000,000 shares of common stock and 15,000,000 shares of preferred stock, each with a par value of $0.0001 per share. Convertible Preferred Stock Prior to its conversion to common stock in connection with the Company’s IPO, the convertible preferred stock was classified as temporary, or mezzanine, equity on the accompanying condensed consolidated balance sheets since the shares contained certain redemption features that were not solely within the control of the Company. The Company had not previously accreted the convertible preferred stock to its redemption value since the shares were not redeemable and redemption was not deemed to be probable. Convertible preferred stock authorized and issued as of December 31, 2019 consisted of the following (in thousands, except share and per share amounts): AS OF DECEMBER 31,2019 Shares Authorized Shares Issued and Outstanding Issue Period Price Per Share Aggregate Liquidation Preference Series Mezzanine 1 4,299,319 4,299,319 2017 - 2018 $ 6.98 $ 30,009.2 Series Mezzanine 2 21,465,681 8,235,012 2018 - 2019 $ 6.98 57,480.4 Total 25,765,000 12,534,331 $ 87,489.6 During the year ended December 31, 2019, the Company issued 1.7 million shares of Series Mezzanine 2 Preferred Stock at a purchase price of $6.98 per share, resulting in net proceeds of approximately $12.0 million, after deducting offering expenses. No shares of Series Mezzanine 1 Preferred Stock and Series Mezzanine 2 Preferred Stock were issued during the nine months ended September 30, 2020. In connection with the completion of the Company’s IPO in August 2020, all of the outstanding shares of convertible preferred stock were converted into 7,211,086 shares of the Company’s common stock. Common Stock Warrants As discussed in Note 3, the Company issued warrants to Oxford concurrently with the 2020 Loan Agreement. Upon the consummation of the Company’s IPO in August 2020, the warrants are exercisable for 7,354 shares of common stock of the Company at $17.00 per share. As of September 30, 2020, the warrants are equity-classified and reflected in additional paid-in-capital at $0.14 million. The fair value of the warrants was determined using the Black-Scholes model on the date of conversion. No subsequent remeasurement is required for equity-classified warrants. |
EQUITY COMPENSATION PLANS
EQUITY COMPENSATION PLANS | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
EQUITY COMPENSATION PLANS | EQUITY COMPENSATION PLANS Stock Incentive Plan The Company has one share-based compensation plan, the Amended and Restated 2017 Employee, Director and Consultant Equity Incentive Plan (the “2017 Plan”), which provides for the issuance of incentive stock options, restricted and unrestricted stock awards, and other stock-based awards. As of September 30, 2020, an aggregate of 3.0 million shares of common stock were reserved for issuance under the 2017 Plan, of which 0.6 million were available. Stock Option Activity The Company recognizes compensation costs related to stock-based awards, including stock options, based on the estimated fair value of the awards on the date of grant. The Company grants options with an exercise price equal to the fair market value of the Company’s stock on the date of the option grant. The options are subject to four-year vesting with a one-year cliff and have a contractual term of 10 years. A summary of the Company’s stock option activity under its 2017 Plan for the nine months ended September 30, 2020 is as follows (in thousands, except for per share data and years): NUMBER OF SHARES WEIGHTED AVERAGE EXERCISE PRICE WEIGHTED AVERAGE REMAINING CONTRACTUAL TERM (IN YEARS) AGGREGATE INTRINSIC VALUE Outstanding as of December 31, 2019 2,013 $ 10.92 9.0 $ 1,261 Granted 573 $ 12.05 9.6 $ 3,515 Exercised — $ 10.52 Forfeited (231) $ 11.15 Outstanding as of September 30, 2020 2,355 $ 11.17 8.3 $ 16,184 Vested and exercisable as of September 30, 2020 864 $ 10.83 7.7 $ 6,200 Stock-Based Compensation Expense Stock options are valued using the Black-Scholes Merton option pricing model on the date of grant. This option pricing model involves a number of estimates, including the expected lives of the stock options, the Company’s anticipated stock volatility and interest rates. Stock-based compensation expense is recognized using the straight-line method over the vesting period. The Company recognizes forfeitures as they occur. The weighted-average assumptions used by the Company to estimate the fair value of stock option grants using the Black-Scholes option pricing model, as well as the resulting weighted-average fair value for the nine months ended September 30, 2020 and 2019 were as follows: NINE MONTHS ENDED SEPTEMBER 30, 2020 2019 (unaudited) Risk-free interest rate 0.41 % 2.07 % Expected volatility 97.78 % 87.43 % Expected dividend yield — % — % Expected term 6.08 6.08 Weighted average fair value $ 9.33 $ 9.82 The Company determines the assumptions used in the option pricing model in the following manner: Risk-Free Interest Rate— For the determination of the risk-free interest rates, the Company utilizes the U.S. Treasury yield curve for instruments in effect at the time of measurement with a term commensurate with the expected term assumption. Expected Volatility— Due to the Company’s limited historical stock price volatility data, the Company based its estimate of expected volatility on the estimated and expected volatilities of a guideline group of publicly traded companies. For these analyses, the Company selected companies with comparable characteristics including enterprise value, risk profiles, and with historical share price information sufficient to meet the expected life of the stock-based awards. The Company computes the historical volatility data using the daily closing prices for the selected companies’ shares during the equivalent period of the calculated expected term of its stock-based awards. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available. Expected Dividend— The expected dividend yield is assumed to be zero since the Company has never paid dividends and does not have current plans to pay any dividends on its common stock. Expected Term— The Company estimates the expected term of its stock options granted to employees and non-employee directors using the simplified method, whereby, the expected term equals the average of the vesting term and the original contractual term of the option. The Company utilizes this method since it does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. Prior to the IPO, given the absence of a public trading market for the Company’s common stock, its board of directors exercised their judgment and considered a number of objective and subjective factors to determine the best estimate of the fair value of the Company’s common stock underlying the stock options, such as: contemporaneous valuations performed by independent third-party specialists, its stage of development, including the status of its research and development efforts of its therapeutic candidates and the material risks related to its business and industry, its results of operations and financial condition, including its levels of capital resources, the prices at which its sold shares of its convertible preferred stock, the rights, preferences and privileges of its convertible preferred stock relative to those of its common stock, the conditions in the biotechnology industry and the economy in general, the stock price performance and volatility of comparable life sciences public companies, as well as recently completed mergers and acquisitions of peer companies, the likelihood of achieving a liquidity event for the holders of its common stock or convertible preferred stock, such as an IPO or a sale of the Company given prevailing market conditions, trends and developments in its industry, external market conditions affecting the life sciences and biotechnology sectors, and the lack of liquidity of its common stock, among other factors. Subsequent to the Company’s IPO, the fair value of the Company’s common stock is determined based on its closing market price. The Company’s board of directors intended all options granted to be exercisable at a price per share not less than the per share fair value of its common stock underlying those options on the grant date. Stock-based compensation expense for stock options consisted of the following (in thousands): THREE MONTHS ENDED NINE MONTHS ENDED 2020 2019 2020 2019 Research and development $ 1,103 $ 877 $ 3,149 $ 2,449 General and administrative 200 142 501 401 Total stock-based compensation expense $ 1,303 $ 1,019 $ 3,650 $ 2,850 |
LICENSE AND GRANT REVENUES
LICENSE AND GRANT REVENUES | 9 Months Ended |
Sep. 30, 2020 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
LICENSE AND GRANT REVENUES | LICENSE AND GRANT REVENUES The following table summarizes the total revenue recorded in the Company’s condensed consolidated statements of operations (in thousands): THREE MONTHS ENDED NINE MONTHS ENDED 2020 2019 2020 2019 License fee revenue from affiliates Transcenta Holding, Ltd. $ — $ — $ — $ 1,000 Elpiscience Biopharmaceuticals, Inc. 2,000 — 2,000 — Total license fee revenue from affiliates 2,000 — 2,000 1,000 License fee revenue from non-affiliates Phylaxis BioScience, LLC 809 — 809 — bluebird bio, Inc. — — 400 7,000 Chiesi Farmaceutici S.p.A. 1,967 794 5,773 794 Other license revenues from non-affiliates 1,050 — 1,050 32 Total license fee revenue from non-affiliates 3,826 794 8,032 7,826 Grant revenue National Institutes of Health — — — 880 Combating Antibiotic Resistant Bacteria Accelerator — 364 — 3,096 Congressionally Directed Medical Research Program 75 61 80 146 Total grant revenue 75 425 80 4,122 Total revenue $ 5,901 $ 1,219 $ 10,112 $ 12,948 License and Collaboration Agreements Phylaxis Agreements In July 2020, the Company entered into a joint venture with an entity affiliated with ArrowMark Partners, Phylaxis BioScience, LLC (“Phylaxis”). In connection with the joint venture, the Company entered into the following agreements: Contribution Agreement, License Agreement, Limited Liability Company Agreement, and Master Services Agreement (collectively the “Phylaxis Agreements”), pursuant to which the Company licensed certain intellectual property and know-how to Phylaxis and agreed to provide services to develop certain compounds. Upon closing, the Company received a $2.5 million nonrefundable, upfront payment from Phylaxis under the Master Services Agreement (“MSA”). The Company is also entitled to an additional $2.5 million payable within 180 days from closing under the MSA. Upon closing, the Company received a 10% equity interest in Phylaxis as consideration for the contribution of the license of the Company’s intellectual property and know-how and is entitled to receive an additional 5% based on the achievement of certain milestones. Under the License Agreement, the Company is also entitled to specified development and commercialization milestone payments of up to an aggregate of $225.0 million and $175.0 million, respectively. The Company is also entitled to share in a percentage of the profits of Phylaxis under the Limited Liability Company Agreement. In order to determine the fair value of the equity interest in Phylaxis, the Company engaged a third-party valuation specialist. The valuation report utilized a market approach to establish the total equity value of Phylaxis using inputs not observable in the market, including the discount rate. The fair value of the equity interest was $0.5 million, which has been accounted for under the equity method. The fair value of the equity interest upon the execution of the agreements has been included in the transaction price, along with the $5.0 million of payments due pursuant to the MSA. The Company identified the transfer of the exclusive licenses for, and performance of, development services to modify the first and second compounds as one performance obligation and allocated the transaction price evenly between the two compounds. Revenue related to the performance obligation will be recognized over time as services are performed, based on the Company’s progress to satisfy the performance obligation. During the three and nine months ended September 30, 2020, the Company has recognized $0.8 million of revenue related to this performance obligation. bluebird 2018 License Agreement On December 20, 2018, the Company entered into a License Agreement with bluebird bio, Inc. (“bluebird”) whereby the Company granted bluebird the exclusive, worldwide rights to develop, manufacture, and commercialize certain cell therapy products containing binders. In January 2019, the Company received a non-refundable upfront fee of $7.0 million from bluebird for this exclusive license. As part of the Company’s performance obligations to bluebird, it transferred certain know-how to bluebird, the completion of which occurred in March 2019. As a result, the Company recognized the $7.0 million upfront payment as license fee revenue during March 2019 upon completion of all performance obligations. The Company is also entitled to receive specified development milestone payments of up to an aggregate of $51.5 million per therapeutic, as well as percentage tiered royalties on future product sales with rates in the mid-single-digits. Due to the uncertainty in the achievement of the developmental milestones, the variable consideration associated with the future milestone payments has been fully constrained (excluded) from the transaction price until such time that the Company concludes that it is probable that a significant reversal of previously recognized revenue will not occur. These estimates will be re-assessed at each reporting period. 2020 Option and License Agreement In June 2020, the Company entered into a separate Option and License Agreement with bluebird, pursuant to which the Company granted to bluebird exclusive worldwide development licenses to develop binders and cell therapy products containing sdAbs directed to specified targets, consisting of two initial programs and up to an additional 8 programs. The Company retains all rights to the specific sdAbs outside of the cell therapy field. In June 2020, the Company received a non-refundable upfront option fee of $0.2 million in connection with each of the two initial programs, or $0.4 million in aggregate, and is entitled to an upfront option fee for each additional program, on a program-by-program basis. The Company also granted to bluebird an option to acquire an exclusive license with respect to all binders and cell therapy products developed under this agreement, which entitles the Company to additional fees upon exercise of the option. In connection with each program for which bluebird exercises its option, bluebird will be required to pay the Company a one-time, non-refundable, non-creditable fee in the low-single-digit millions for each option bluebird chooses to exercise. The Company is also entitled to receive certain developmental milestone payments of up to an aggregate of $51.5 million per therapeutic, as well as percentage tiered royalties on future product sales with rates in the mid-single-digits. Due to the uncertainty in the achievement of the developmental milestones and future sales, the variable consideration associated with the future milestone payments has been fully constrained (excluded) from the transaction price until such time that the Company concludes that it is probable that a significant reversal of previously recognized revenue will not occur. These estimates will be re-assessed at each reporting period. As of the effective date of the agreement, the Company identified one performance obligation, which was the transfer of the exclusive development license to bluebird for the two initial programs. The Company determined that the option granted for an exclusive license in the future was not a material right. For the eight programs not identified upon execution of the contract, the Company evaluated the customer option for additional purchases and determined that those options for additional programs did not constitute material rights nor variable consideration. As additional programs are identified, the Company will reassess its performance obligations and transaction price accordingly. The Company determined the total transaction price of the contract at execution was $0.4 million for the transfer of the two exclusive development licenses. The Company recognized $0.4 million of revenue related to this agreement at the point in time in which the exclusive development licenses were transferred to bluebird, which occurred upon execution of the agreement in June 2020. Chiesi In May 2019, the Company entered into an Option Agreement (as amended by the First Amendment to Option Agreement, dated August 19, 2019, the “Chiesi Option Agreement”) with Chiesi Farmaceutici S.p.A. (“Chiesi”), pursuant to which the Company granted to Chiesi an exclusive option to obtain an exclusive license to develop and commercialize INBRX-101 outside of the United States and Canada. Under the terms of the Chiesi Option Agreement, the Company received a one-time, non-refundable option initiation payment of $10.0 million in August 2019. If Chiesi chooses to exercise its option under the Chiesi Option Agreement, then Chiesi must pay the Company a one-time, non-refundable fee of $12.5 million upon the effective date of the definitive agreement granting Chiesi the exclusive license. If the option is exercised, under the license agreement, the Company may be entitled to receive specified milestone payments of up to $122.5 million, as well as royalties on future product sales. The Company has identified one performance obligation as of the effective date of this agreement, which is to perform research and development services for Chiesi during the option period, which will continue (unless the Chiesi Option Agreement is terminated earlier by the Chiesi or the Company) until 60 days following the last to occur of (i) the Company’s delivery to Chiesi of the trial phase data for the first Phase I Clinical Trial, (ii) the Company’s delivery to Chiesi of the finalized minutes from the definitive U.S. Food and Drug Administration (“FDA”) scientific advice meeting conducted following completion of such Phase I Clinical Trial, and (iii) the Company’s delivery to Chiesi of the finalized minutes from the definitive parallel EMA-HTA scientific advice meeting conducted following completion of such Phase I Clinical Trial. The Company has determined that the option to grant a license in the future is not a material right. The $10.0 million upfront payment has been allocated to the single performance obligation. Revenue will be recognized over time as services are performed during the option period, based on the Company’s effort to satisfy the performance obligation relative to the total expense estimated to be incurred during the option period. During the three months ended September 30, 2020 and 2019, the Company recognized $2.0 million and $0.8 million, respectively, in revenue related to this agreement. During the nine months ended September 30, 2020 and 2019, the Company recognized $5.8 million and $0.8 million, respectively, in revenue related to this agreement. Elpiscience As of September 30, 2020, the Company has entered into two different License Agreements with Elpiscience Biopharmaceuticals, Inc. (“Elpiscience”). Each agreement is a standalone license of a distinct and differentiated protein therapeutic candidate with a separate biological target, providing a unique benefit. Neither the license nor the asset is reliant upon the other. PD-L1 and 4-1BB Program In February 2018, the Company entered into a License Agreement (the “PD-L1 and 4-1BB License Agreement”) with Elpiscience, whereby the Company granted Elpiscience an exclusive license to the Company’s bi-specific therapeutic candidate designed to target PD-L1 and 4-1BB (also referred to as “INBRX-105”). This license provides Elpiscience with the right to further advance the therapeutic candidate through clinical trials, as well as to manufacture and commercialize it. It also requires the Company to provide Elpiscience with know-how and materials specific to INBRX-105, including process development and manufacturing data and information necessary to develop INBRX-105. In the PD-L1 and 4-1BB License Agreement, the Company also agreed to negotiate an agreement to supply Elpiscience with INBRX-105 for its development in China, Hong Kong, Macau and Taiwan. The Company is eligible to receive specified developmental and commercial milestone payments of up to an aggregate of $100.0 million, as well as percentage tiered royalties on future product sales with rates in the high single-digits. Due to the uncertainty in the achievement of the developmental milestones, the variable consideration associated with the future milestone payments has been fully constrained (excluded) from the transaction price until such time that the Company concludes that it is probable that a significant reversal of previously recognized revenue will not occur. This will be re-assessed at each reporting period. Under the PD-L1 and 4-1BB License Agreement, the Company is entitled to reimbursement for certain toxicology study costs and chemistry, manufacturing and controls (“CMC”) costs. Elpiscience paid the Company $3.0 million in March 2018 for certain costs in relation to the development of INBRX-105. The payment received in advance of the work to be completed was recorded to other current liabilities upon receipt and, since the Company was acting as an agent on behalf of Elpiscience, the Company recorded it as a contra-expense against research and development as the relevant work was completed. During the three and nine months ended September 30, 2019, the Company derecognized approximately $0 and $0.7 million of liabilities related to this agreement, respectively. As of September 30, 2019, the Company had completed all relevant work on this program and had no remaining liabilities related to the reimbursement under the PD-L1 and 4-1BB License Agreement. OX40 Program In April 2018, the Company entered into a separate License Agreement (the “OX40 License Agreement”) with Elpiscience, whereby the Company granted Elpiscience an exclusive license to the Company’s multivalent protein therapeutic directed to the biological target OX40 (also referred to as “INBRX-106”). This license provides Elpiscience with the right to further advance the therapeutic candidate through clinical trials, as well as manufacture and commercialize it. It also requires the Company to provide Elpiscience with know-how and materials specific to INBRX-106, including process development and manufacturing data and information necessary to develop INBRX-106. In the OX40 License Agreement, the Company also agreed to negotiate an agreement to supply Elpiscience with INBRX-106 for its development in Mainland China, Hong Kong Macau and Taiwan. The Company is eligible to receive certain developmental and commercial milestones of up to an aggregate of $100.0 million, as well as percentage tiered royalties on future product sales with rates in the high single-digits. Due to the uncertainty in the achievement of the developmental and commercial milestones, the variable consideration associated with the future milestone payments has been fully constrained (excluded) from the transaction price until such time that the Company concludes that it is probable that a significant reversal of previously recognized revenue will not occur. This will be re-assessed at each reporting period. In September 2020, the Company achieved a milestone under the contract for $2.0 million, which was received during September 2020. The Company recognized revenue of $2.0 million during the three and nine months ended September 30, 2020 related to this agreement. No revenue was recognized related to this agreement during the three and nine months ended September 30, 2019. Under the OX40 License Agreement, the Company is entitled to reimbursement for certain toxicology study costs and CMC costs. Elpiscience paid the Company $3.4 million in August 2018 for certain costs incurred in relation to the development and production of INBRX-106. The payment received in advance of the work to be completed was recorded to other current liabilities upon receipt and since the Company was acting as an agent on behalf of Elpiscience, the Company recorded it as a contra-expense against research and development as the relevant work was completed. As of September 30, 2020, the Company has $0.2 million recorded as receivables from related parties from Elpiscience for expenses incurred which have not yet been reimbursed. As of September 30, 2020 and December 31, 2019, the Company had no liabilities outstanding related to this agreement. During the three and nine months ended September 30, 2020, the Company received $0 and $0.2 million in reimbursements for expenses already incurred, respectively. During the three and nine months ended September 30, 2019, the Company derecognized approximately $0.1 million and $1.3 million of liabilities related to this reimbursement, respectively. Additional reimbursements of $0.1 million related to multi-year stability studies are expected to be recognized and paid upon completion. Transcenta In June 2017, the Company entered into a License Agreement with Transcenta Holding, Ltd. (formerly Hangzhou Just Biotherapeutics Co., Ltd.), (“Transcenta”) (the “Transcenta License Agreement”), whereby the Company granted Transcenta exclusive, non-transferable rights to develop, manufacture, and sell its products containing the Company’s protein therapeutic candidate, designed to target DR5 (also referred to as “INBRX-109”), or a derivative thereof, within mainland China, Hong Kong, Macau and Taiwan and agreed to provide Transcenta with the intellectual property and materials, including assays and cell lines, necessary to develop the therapeutic candidate. In addition, pursuant to the Transcenta License Agreement, the Transcenta License Agreement granted the Company a royalty-free, worldwide, non-exclusive research license to intellectual property created by Transcenta that incorporates intellectual property licensed to Transcenta. In June 2019, the Company achieved a milestone under the contract for $1.0 million, which was received during August 2019, net of $0.1 million in foreign tax withholding. Under the Transcenta License Agreement, the Company is also eligible to receive certain developmental and commercial milestone payments of up to an aggregate of approximately $100.0 million, as well as percentage tiered royalties on future product sales with rates ranging between the high single-digits to the low teens. Due to the uncertainty in the achievement of the developmental and commercial milestones, the variable consideration associated with the future milestone payments has been fully constrained (excluded) from the transaction price until such time that the Company concludes that it is probable that a significant reversal of previously recognized revenue will not occur. These estimates will be re-assessed at each reporting period. Celgene In June 2012, the Company entered into a Development and Option agreement with Celgene whereby the Company granted Celgene an option to exclusively license certain intellectual property rights relating to the Company’s CD47 checkpoint inhibitor . Upon grant of the Development and Option agreement, Celgene made a non-refundable upfront option payment for the exclusive license. In June 2013, Celgene opted to exercise its right to license the intellectual property rights associated with the Company’s CD47 therapeutic. The Company is also eligible to receive certain developmental and commercial milestones of an aggregate of $934.1 million, assuming the achievement of all potential milestones in the agreement, as well as percentage tiered royalties based on future worldwide sales, with rates ranging between the high single-digits and low teens. The Company is obligated to pay 2% of future amounts received under the Development and Option Agreement to advisors who assisted the Company with the negotiation and other matters in connection with the Development and Option agreement. Government Grants Grant revenue was recognized in accordance with the Company’s stated methodology discussed in Note 1. NIH During August 2017, the Company was awarded a grant by the NIH in the amount of $1.0 million for the continued development of multi-specific antibodies for the treatment of Pseudomonas aeruginosa infection, all of which has been recognized as revenue upon completion in June 2019. Revenue from this NIH grant was based upon internal and subcontractor costs incurred by the Company that are specifically covered by the grants, and where applicable, an additional facilities and administrative rate that provided funding for overhead expenses. Revenue was recognized when the Company incurred these covered expenses related to the grant’s continued progression. The Company submitted invoices to the NIH for only those expenses which had been incurred by the Company in each period, resulting in reimbursement in arrears. CARB-X Subaward Agreement During July 2017, the Company was awarded a grant by Boston University in the amount of approximately $4.6 million. The program, Combating Antibiotic Resistant Bacteria Accelerator (“CARB-X”), is a non-profit public-private partnership dedicated to accelerating antibacterial research to tackle the global rising threat of drug-resistant bacteria. The Company received this award in relation to its program aimed at the development of novel antimicrobial therapeutics using multiple mechanisms of action to circumvent the development of resistance, and in the case of this grant, specifically for pseudomonas. The payment structure of this grant was a cost share, where 70% of costs were reimbursed by the sponsor, or Boston University, and the remaining 30% of costs are covered by the Company. The work under this grant began in October 2017 and was discontinued during the third quarter of 2019 based on the uncertainty within the applicable regulatory environment. Revenue from this grant was based upon internal costs incurred by the Company that were specifically covered by the grant as well as certain specified overhead expenses. Revenue was recognized when the Company incurred these covered expenses related to the grant’s continued progression. The Company submitted invoices to Boston University for only those expenses which had been incurred by the Company in each period, resulting in reimbursement in arrears. Prior to discontinuation of the work on this grant, $4.0 million in revenue was recognized, all of which has been received in cash from Boston University. CDMRP funded through the DoD During September 2018, the Company was awarded a grant by the CDMRP funded through the DoD by the U.S. Army Medical Research Acquisition Activity in the amount of approximately $0.3 million for the continued development of multi-specific antibodies for the treatment against Acinetobacter baumannii infection by circumventing development of bacterial resistance. The work under this grant began in December 2018 and was completed in September 2020. Revenue from this grant is based upon internal and subcontractor costs incurred by the Company that are specifically covered by the grants, and where applicable, an additional facilities and administrative rate that provided funding for overhead expenses. Revenue is recognized when the Company incurs these covered expenses related to the grant’s continued progression. The Company submits requests for reimbursement to the DoD for only those expenses which have been incurred by the Company in each period, resulting in reimbursement in arrears. As of September 30, 2020, $0.3 million in revenue has been recognized under this grant, $0.2 million of which has been received in cash from the DoD. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS From time to time, the Company will enter into an agreement with a related party in the ordinary course of its business and on terms and conditions it believes are as fair as those it offers and receives from independent third parties. These agreements are ratified by the Company’s Board of Directors or a committee thereof pursuant to policy. LAV Summit Limited LAV Summit Limited (“LAV SL”), a limited company, is a principal shareholder owning more than 5% of the Company’s outstanding equity interest as of September 30, 2020 and December 31, 2019. Due to this equity ownership, LAV SL is considered a related party. Moreover, Judith Li, a former member of the Company’s board of directors, is a Partner at LAV SL’s General Partner, Lilly Asia Ventures (“LAV”), a biomedical venture capital firm. In June 2017, the Company entered into the Transcenta License Agreement. LAV, through one of its funds, holds a significant equity ownership position in Transcenta. During the three and nine months ended September 30, 2019, the Company recorded revenue of $0 and $1.0 million related to this agreement. During the three and nine months ended September 30, 2020, the Company recorded no revenue related to this agreement. See Note 8 for further discussion of this agreement. In February 2018, the Company entered into the PD-L1 and 4-1BB License Agreement with Elpiscience. LAV, through one of its funds, holds a significant equity ownership position in Elpiscience and the Venture Partner of LAV is the CEO, Founder, and Director at Elpiscience. Accordingly, the Company identifies Elpiscience as a related party. Under this agreement, the Company is entitled to reimbursement for certain CMC and toxicology expenses incurred for which Elpiscience has paid the Company $4.7 million to date as of September 30, 2020 and December 31, 2019. During the three and nine months ended September 30, 2020 and 2019, the Company recorded no revenue related to this agreement. See Note 8 for further discussion of this agreement. In April 2018, the Company entered into the OX40 License Agreement with Elpiscience. Under this agreement, the Company is entitled to reimbursement for certain CMC and toxicology expenses incurred for which Elpiscience has paid the Company approximately $5.1 million and $4.9 million to date as of September 30, 2020 and December 31, 2019, respectively. During the three and nine months ended September 30, 2020, the Company recorded $2.0 million of revenue related to this agreement. During the three and nine months ended September 30, 2019, the Company recorded no revenue related to this agreement. See Note 8 for further discussion of this agreement. WuXi Biologics Healthcare Venture |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Operating Leases In September 2017, the Company entered into a seven-year lease agreement for approximately 34,000 square feet as its sole location in La Jolla, California. The lease expires in June 2025 with an option to extend the lease an additional five years. The lease contained an initial base rent of approximately $0.1 million per month with 2% annual escalations, plus a percentage of taxes and operating expenses incurred by the lessor in connection with the ownership and management of the property, the latter of which to be determined annually. In May 2019, the Company executed an amendment to its lease agreement to expand its facilities by approximately 9,000 square feet and began occupying this space in January 2020. The amended lease terminates coterminously with the initial lease agreement and contains an initial base rent of approximately $30,000 per month with 2% annual escalations, plus a percentage of taxes and operating expenses incurred by the lessor in connection with the ownership and management of the property, the latter of which is to be determined annually. The right-of-use asset and operating lease liability as of September 30, 2020 and December 31, 2019 are as follows: AS OF SEPTEMBER 30, AS OF DECEMBER 31, 2020 2019 (unaudited) Right-of-use asset $ 8,185 $ 7,453 Operating lease liability Current $ 1,463 $ 1,105 Non-current $ 7,097 $ 6,698 Total operating lease liability $ 8,560 $ 7,803 During the three months ended September 30, 2020 and 2019, the Company recognized operating lease expense of $0.8 million and $0.6 million, respectively. During the nine months ended September 30, 2020 and 2019, the Company recognized operating lease expense of $2.3 million and $1.7 million, respectively. As of September 30, 2020 and December 31, 2019, the Company’s operating lease had a remaining term of 4.8 and 5.5 years, respectively. The Company discounts its lease payments using its incremental borrowing rate as of the commencement of the lease. The Company has determined a weighted-average discount rate of 8.2% and 8.0% as of September 30, 2020 and December 31, 2019, respectively. Future minimum rental payments under operating leases are as follows (in thousands): AS OF SEPTEMBER 30, 2020 (unaudited) 2020 (3 months) $ 522 2021 2,119 2022 2,161 2023 2,203 2024 2,247 Thereafter 1,137 Total future minimum lease payments $ 10,389 Less: imputed interest (1,829) Present value of operating lease liability 8,560 Less: current portion of operating lease liability (1,463) Non-current portion of operating lease liability $ 7,097 Litigation The Company is not party to any material legal proceedings. From time to time, it may be involved in legal proceedings or subject to claims incident to the ordinary course of business. Regardless of the outcome, such proceedings or claims can have an adverse impact on the Company because of defense and settlement costs, diversion of resources and other factors, and there can be no assurances that favorable outcomes will be obtained. Indemnification 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. In some cases, the indemnification obligation 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. In addition, the Company has entered into indemnification agreements with its directors and certain officers that may 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 date, no demands have been made upon the Company to provide indemnification under these agreements, and thus, there are no indemnification claims that the Company is aware of that could have a material effect on the Company’s condensed consolidated balance sheets, condensed consolidated statements of operations, or condensed consolidated statements of cash flows. |
COVID-19
COVID-19 | 9 Months Ended |
Sep. 30, 2020 | |
Unusual or Infrequent Items, or Both [Abstract] | |
COVID-19 | COVID-19 On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the “COVID-19 outbreak”) and the risks to the international community as the virus spreads globally beyond its point of origin. In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. The continued spread of the COVID-19 pandemic is affecting the United States and global economies and may affect the Company’s operations and those of third parties on which the Company relies, including by causing disruptions in the supply of the Company’s therapeutic candidates and the conduct of future clinical trials. In addition, the COVID-19 pandemic may affect the operations of the FDA which could result in delays in meetings, reviews and approvals, including with respect to any of the Company’s therapeutic candidates. For example, as a result of the COVID-19 pandemic patient travel restrictions, the Company temporarily suspended patient enrollment for its trial for INBRX-101 during the second and third quarters of 2020. Additionally, while the potential economic impact brought by, and the duration of, the COVID-19 pandemic is difficult to assess or predict, the impact of the COVID-19 pandemic on the global financial markets may reduce the Company’s ability to access capital, which could negatively impact the Company’s short-term and long-term liquidity. The ultimate impact of the COVID-19 pandemic is highly uncertain and subject to change. The Company does not yet know the full extent of potential delays or impacts on its business, financing or future clinical trial activities or on healthcare systems or the global economy as a whole. However, these effects could have a material impact on the Company’s business, financial condition, results of operations and prospects, and those of the third parties relied upon by the Company. CARES Act |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS For the unaudited condensed consolidated financial statements as of September 30, 2020, the Company evaluated subsequent events to assess the need for potential recognition or disclosure in this report. Based upon this evaluation, it was determined that no additional subsequent events required recognition or disclosure in these condensed consolidated financial statements, other than disclosures related to those outlined below. PPP Loan Repayment In October 2020, after receiving proceeds from its IPO, the Company repaid its PPP Loan in full. As of the repayment date, the Company had accrued approximately $7,400 of interest, for a total repayment of $1.9 million. As discussed in Note 4, there were no prepayment penalties associated with the payment of the loan prior to maturity. Amendment to the 2020 Loan Agreement with Oxford On November 12, 2020, the Company entered into the First Amendment to the 2020 Loan Agreement with Oxford (the “2020 Loan Amendment”). The 2020 Loan Amendment provides for two additional tranches of term loans in an aggregate principal amount of up to $40.0 million, as follows: (a) the second tranche in an aggregate principal amount of $20.0 million, funded upon the closing of the 2020 Loan Amendment (“Tranche B”), and (b) the third tranche in an aggregate principal amount of $20.0 million to fund on or before September 30, 2021, subject to the initiation of a registration-enabling trial for the Company’s therapeutic candidate, INBRX-109, in chondrosarcoma, pursuant to the terms of the 2020 Loan Amendment (“Tranche C”). Tranche B and Tranche C are in addition to the first tranche of term loans in an aggregate principal amount of $10.0 million, which was funded on July 15, 2020. In accordance with the 2020 Loan Amendment, the Company paid a one-time first amendment fee of $0.7 million. The terms of the first tranche under the 2020 Loan Agreement were modified to align with Tranche B pursuant to the 2020 Loan Amendment. |
ORGANIZATION AND SUMMARY OF S_2
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) related to an interim report on the Form 10-Q. The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All intercompany accounts and transactions have been eliminated in consolidation. The unaudited interim condensed financial statements reflect all adjustments which, in the opinion of management, are necessary for a fair statement of the results for the periods presented. All such adjustments are of a normal and recurring nature. The operating results presented in these unaudited interim condensed financial statements are not necessarily indicative of the results that may be expected for any future periods. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted. Accordingly, the accompanying unaudited interim financial statements should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2019, which are included in the Company’s final prospectus filed with the SEC pursuant to Rule 424(b)(4) on August 19, 2020 under the Securities Act of 1933, as amended (the “Securities Act”). |
Liquidity | Liquidity As of September 30, 2020, the Company had an accumulated deficit of $127.7 million and cash and cash equivalents of $127.7 million. From its inception and through September 30, 2020, the Company has devoted substantially all of its efforts to therapeutic drug discovery and development, conducting preclinical studies and clinical trials, enabling manufacturing activities in support of its therapeutic candidates, organizing and staffing the Company, establishing its intellectual property portfolio and raising capital to support and expand these activities. |
Use of Estimates | Use of Estimates The preparation of these unaudited condensed consolidated financial statements in conformity with GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expense and the disclosure of contingent assets and liabilities in the Company’s financial statements and accompanying notes. The Company’s most significant estimates relate to evaluation of embedded derivative instruments and beneficial conversion features within convertible notes, whether revenue recognition criteria have been met, accounting for development work and preclinical studies and clinical trials, determining the assumptions used in measuring stock-based compensation, the incremental borrowing rate estimated in relation to the Company’s operating lease, and valuation allowances for the Company’s deferred tax assets. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. The Company’s actual results may differ from these estimates under different assumptions or conditions. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments consist principally of accounts receivable, accounts payable, accrued expense, its current loan and security agreement (the “2020 Loan Agreement”) with Oxford Finance LLC (“Oxford”) and its former loan and security agreement, as amended (the “2015 Loan Agreement”), which has been terminated, warrants, and derivative instruments as applicable. The carrying amounts of financial instruments such as accounts receivable, accounts payable, accrued expense and convertible notes approximate their related fair values due to the short-term nature of these instruments. The Company’s derivative instruments and warrants are carried at fair value based on unobservable market inputs. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents are comprised of cash held in financial institutions including readily available checking and money market accounts. |
Concentrations of Credit Risk | Concentrations of Credit Risk The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash balances due to the financial condition of the depository institution in which those deposits are held. The Company continually evaluates its accounts receivable for all outstanding third-party balances to determine the potential exposure to a concentration of credit risk. The Company’s major third-party contracting parties, some of which account for significant balances in both accounts receivable and revenue, are generally large, credit-worthy biotechnology companies and government bodies. The Company assesses the collectability of accounts receivable through a review of its current aging, as well as an analysis of its historical collection rate, general economic conditions, and credit status of these third parties. As of September 30, 2020 and December 31, 2019, all outstanding accounts receivable were deemed to be fully collectible, and therefore, no allowance for doubtful accounts was recorded. |
Dividends | Dividends As of September 30, 2020, the Company has never declared or paid any dividends on its common stock. The Company currently intends to retain available cash for funding operations; therefore, it does not expect to pay any dividends in the foreseeable future. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation. Depreciation is provided on a straight-line basis over the estimated useful lives of the assets. The Company estimates useful lives as follows: • machinery and equipment: three • furniture and fixtures: three • computer software: four |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss is recognized when estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition are less than its carrying amount. If such assets are considered impaired, the amount of the impairment loss recognized is measured as the amount by which the carrying value of the asset exceeds the fair value of the asset, fair value being determined |
Leases | Leases The Company has two existing leases for its corporate headquarters in La Jolla, California. Its first lease commenced in June 2018. In May 2019, the Company signed an amendment to its lease agreement to expand the Company’s facilities, which commenced in January 2020. This amendment is accounted for as a separate lease. Leases are reviewed and classified as operating or financing leases at commencement. The Company’s existing leases are classified as operating leases. Effective January 1, 2019, the Company adopted Accounting Standards Update (“ASU”) No. 2016-02, Leases . For the long-term operating lease of its corporate headquarters, the Company recognized a right-of-use asset and lease liability on its condensed consolidated balance sheet. The lease liability is determined as the present value of future lease payments using an estimated incremental borrowing rate that the Company would have to pay to borrow equivalent funds on a collateralized basis at the lease commencement date. The right-of-use asset is based on the liability adjusted for any prepaid or deferred rent. The lease term at the commencement date is determined by considering whether renewal options and termination options are reasonably assured of exercise. The Company has elected to exclude from its condensed consolidated balance sheets recognition of leases having a term of 12 months or less (short-term leases) and has elected not to separate lease components and non-lease components for its long-term operating leases. Rent expense for the operating leases are recognized on a straight-line basis over the lease term and is included in operating expense in the condensed consolidated statements of operations for all periods presented. |
Equity Method Investment | Equity Method Investment The Company uses the equity method of accounting for equity investments in companies if the investment provides the ability to exercise significant influence, but not control, over operating and financial policies of the investee. As discussed in Note 8, the Company received an equity investment in the form of a 10% equity interest as consideration in a series of agreements with Phylaxis BioScience, LLC (“Phylaxis”), which is accounted for as an equity method investment. The Company's proportionate share of the net income or loss of these companies is included as loss in equity method investment in the condensed consolidated statement of operations. Judgment regarding the level of influence over each equity method investment includes considering key factors such as the Company’s ownership interest, representation on the board of directors, legal form of the investee (e.g. limited liability corporation), participation in policy-making decisions, and material purchase and sale transactions. As of September 30, 2020, the Company’s equity method investment has been written down to zero as a result of the allocation of the Company’s share of losses of the investee. |
Derivative Liabilities | Derivative Liabilities As discussed in Note 5, the convertible promissory note (the “2019 Note”) issued in May 2019 to DRAGSA 50, LLC, an entity affiliated with Viking Global Investors LP (“Viking”) and the convertible promissory notes (the “2020 Notes”) issued in April 2020 to Viking and certain other investors contained embedded features that provided multiple settlement alternatives. Certain of these settlement features provided the noteholders with a right to a fixed number of the Company’s shares upon conversion of the note. Other settlement features provided the noteholders the right or the obligation to receive cash or a variable number of shares upon the completion of a capital raising transaction, change of control, qualified IPO (as defined in the 2019 Note and the 2020 Notes), or default of the Company. The Company evaluated each settlement alternative within the 2019 Note and the 2020 Notes under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 815-15, Embedded Derivatives and ASC Topic 815-40, Contracts in Entity’s Own Equity and determined certain of the settlement features would be accounted for as redemption features meeting the requirements for separate accounting as a single, compound derivative instrument. This single, compound derivative instrument was accounted for as a liability at its estimated fair value as of the date of issuance, and then subsequently remeasured to fair value as of each balance sheet date, with the related remeasurement adjustment being recognized as a component of change in fair value of derivative liabilities in the condensed consolidated statements of operations. During August 2020, the Company consummated its IPO, resulting in the conversion of the 2019 Note and the 2020 Notes into shares of the Company’s common stock. As of September 30, 2020, the derivative liabilities no longer exist. |
Warrant Liabilities | Warrant LiabilitiesAs discussed in Note 3, in conjunction with the 2020 Loan Agreement with Oxford, the Company issued warrants for the purchase of: 1) its preferred stock if the Company remained privately-held or 2) common stock upon the successful completion of an IPO prior to December 31, 2020. Upon the issuance of the warrants in July 2020, pursuant to ASC Topic 480, the warrants were accounted for as liabilities and measured at their estimated fair value as of the date of issuance based on the potential conversion into preferred stock. During August 2020, upon consummation of the Company’s IPO, the warrants were deemed to be issued for the purchase of common stock and were no longer accounted for as liabilities. The change in fair value was recognized as a component of change in fair value of warrant liabilities in the condensed consolidated statements of operations during the three and nine months ended September 30, 2020. |
Fair Value Measurements | Fair Value Measurements The Company determines the fair value measurements of applicable assets and liabilities based on a three-tier fair value hierarchy established by accounting guidance and prioritizes the inputs used in measuring fair value. These tiers include: • Level 1 - Quoted prices in active markets for identical assets or liabilities. • Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, 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 that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. |
Deferred Financing Costs and Other Debt-Related Costs and Deferred Offering Costs | Deferred Financing Costs and Other Debt-Related Costs Deferred financing costs are capitalized, recorded as an offset to the Company’s debt balances and amortized as interest expense over the term of the associated debt instrument using the effective interest method, pursuant to ASC Topic 835-30, Imputation of Interest . If the maturity of the debt is accelerated as a result of default or early debt repayment, the amortization would then be accelerated. Amounts paid related to debt financing activities are presented on the condensed consolidated balance sheet as a direct deduction from the debt liability. Deferred Offering Costs The Company capitalizes costs that are directly associated with equity financings until such financings are consummated at which time such costs are recorded against the gross proceeds of the offering. Should an in-process equity financing be abandoned, the deferred offering costs will be expensed immediately as a charge to operating expenses in the statement of operations and comprehensive loss. |
Revenue Recognition | Revenue Recognition To date, the Company has generated revenue from its license and collaboration agreements with partners, as well as from grants from government agencies such as the National Institutes of Health (“NIH”) and the Congressionally Directed Medical Research Program (“CDMRP”) funded through the Department of Defense (“DoD”), as well as from private not-for-profit organizations including Combating Antibiotic Resistant Bacteria Biopharmaceutical Accelerator (“CARB-X”). Payments received from customers are included in deferred revenue, allocated between current and non-current, on the condensed consolidated balance sheet until all revenue recognition criteria are met. In accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), the Company recognizes revenue when, or as, the promised goods or services are transferred to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those services. To determine revenue recognition for arrangements the Company concludes are within the scope of ASC Topic 606, the Company performs the following five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligation(s) in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligation(s) in the contract; and (5) recognize revenue when (or as) the performance obligation(s) are satisfied. At contract inception, the Company assesses the goods or services promised within each contract, assesses whether each promised good or service is distinct and identifies those that are performance obligations. The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when, or as, the performance obligation is satisfied. Collaborative Research, Development, and License Agreements The Company enters into collaborative agreements with partners that typically include one or more of the following: (1) license fees; (2) nonrefundable up-front fees; (3) payments for reimbursement of research costs; (4) payments associated with achieving specific development, regulatory, or commercial milestones; and (5) royalties based on specified percentages of net product sales, if any. At the initiation of an agreement, the Company analyzes whether each unit of account results in a contract with a customer under ASC Topic 606 or in an arrangement with a collaborator subject to guidance under ASC Topic 808, Collaborative Arrangements (“ASC 808”). The Company’s licensing arrangements are typically for functional intellectual property as it exists at a point in time, being the time that the license agreement is executed. The Company typically does not have an ongoing performance obligation to support or maintain the licensed intellectual property. The Company considers a variety of factors in determining the appropriate estimates and assumptions under these arrangements, such as whether the elements are distinct performance obligations, whether there are observable stand-alone prices, and whether any licenses are functional or symbolic. The Company evaluates each performance obligation to determine if it can be satisfied and recognized as revenue at a point in time or over time. Typically, license fees, non-refundable upfront fees, and funding of research activities are considered fixed, while milestone payments are identified as variable consideration which must be evaluated to determine if it is constrained and, therefore, excluded from the transaction price. The Company estimates the amount of variable consideration using the most likely amount, as milestone payments typically only have two possible outcomes. The Company recognizes revenue for sales-based royalty promised in exchange for the license of intellectual property only when the subsequent sale occurs. In the case of an agreement which provides the partner with an option to license a therapeutic or therapeutic candidate in the future, the Company evaluates whether this option represents a material right at the inception of the agreement. If determined to be a material right, the Company will consider the option a separate performance obligation. The Company has historically concluded that the option to grant a license in the future are not material rights as they are contingent upon future events which may not occur. When an option is exercised, the Company will identify any separate performance obligations. The Company may allocate transaction price using a number of methods including estimating standalone selling price of performance obligations and using the residual approach when the standalone selling price of the license is highly variable or uncertain, and observable standalone selling prices exist for the other goods or services promised in the contract. Grant Revenue Since inception, the Company has been awarded multiple grants from the NIH, one grant from the CDMRP funded through the DoD, as well as one grant from CARB-X. With respect to revenue derived from reimbursement of direct, out-of-pocket expenses for research and development costs associated with these grants, where the Company acts as a principal with discretion to choose suppliers, bears credit risk, and performs part of the services required in the transaction, the Company records revenue for the gross amount of the reimbursement. The costs associated with these reimbursements are reflected as a component of research and development expense in the condensed consolidated statements of operations. Since there is no transfer of control of goods or services to the granting entities, the granting entities do not meet the definition of a “customer” as defined by ASC Topic 606 and therefore, these government grants and private not-for-profit institution grants are not within the scope of ASC Topic 606. Since the Company has concluded that these |
Research and Development and Clinical Trial Accrurals | Research and Development and Clinical Trial Accruals Research and development costs are expensed as incurred and include the cost of compensation and related expenses, as well as expenses for third parties who conduct research and development on the Company’s behalf, pursuant to development and consulting agreements in place. The Company’s preclinical studies and clinical trials are performed by third party contract research organizations (“CROs”) and/or clinical investigators. The Company also engages with CDMOs for clinical supplies and manufacturing scale-up activities related to its therapeutic candidates. Invoicing from these third parties may be monthly based upon services performed or based upon milestones achieved. The Company accrues these expenses based upon its assessment of the status of each clinical trial and the work completed, and upon information obtained from the CROs and CDMOs. The Company’s estimates are dependent upon the timeliness and accuracy of data provided by the CROs and CDMOs regarding the status and cost of the studies. Costs incurred related to the Company’s purchases of in-process research and development for early-stage products or products that are not commercially viable and ready for use, or have no alternative future use, are charged to expense in the period incurred. Costs incurred related to the licensing of products that have not yet received regulatory approval to be marketed, or that are not commercially viable and ready for use, or have no alternative future use, are charged to expense in the period incurred. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income taxes are recorded for temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities reflect the tax rates expected to be in effect for the years in which the differences are expected to reverse. A valuation allowance is provided if it is more likely than not that some or all of the deferred tax assets will not be realized. The Company also follows the provisions of accounting for uncertainty in income taxes which prescribes a model for the recognition and measurement of a tax position taken or expected to be taken in a tax return, and provides guidance on derecognition, classification, interest and penalties, disclosure and transition. |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the same period. Diluted net loss per share is computed by dividing net loss by the weighted average number of common and common equivalent shares outstanding during the same period. The Company excludes common stock equivalents from the calculation of diluted net loss per share when the effect is anti-dilutive. |
Fair Value of Stock-Based Awards | Fair Value of Stock-Based Awards The Company recognizes compensation costs related to stock options based on the estimated fair value of the awards on the date of grant. The Company estimates the grant date fair value, and the resulting stock-based compensation expense, using the Black-Scholes option pricing model. The grant date fair value of the stock-based awards is generally recognized on a straight-line basis over the requisite service period, which is generally the vesting period of the respective awards. The Company recognizes forfeitures as they occur. |
Other Comprehensive Income | Other Comprehensive Income The Company has no material components of other comprehensive loss and accordingly, net loss is equal to comprehensive loss in all periods presented. |
Segment Information | Segment Information The Company operates under one segment which develops biologic therapeutic candidates. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies. Unless otherwise stated, the Company believes that the impact of the recently issued accounting pronouncements that are not yet effective will not have a material impact on its condensed consolidated financial condition or results of operations upon adoption. The Company has irrevocably elected not to take advantage of the extended transition period afforded by the Jumpstart Our Business Startups Act of 2012, as amended (“JOBS Act”), for the implementation of new or revised accounting standards and, as a result, will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Adoption of New Accounting Pronouncements In August 2018, the FASB issued ASU 2018-13, Fair Value Measurements (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurements, which includes amendments intended to improve the effectiveness of disclosure requirements for recurring and nonrecurring fair value measurements. The standard removes, modifies, and adds certain disclosure requirements and affects companies that are required to include fair value measurement disclosures. The amendments in ASU 2018-13 are effective for fiscal years beginning after December 15, 2019 with early adoption permitted. The Company adopted this guidance as of January 1, 2020, which did not result in a material impact on its condensed consolidated financial statements and related disclosures. Accounting Standards Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses : Measurement of Credit Losses on Financial Statements (Topic 362), which intends to improve financial reporting by requiring earlier recognition of credit losses on certain financial assets, such as available-for-sale debt securities. Subsequent to the issuance of ASU 2016-13, the FASB issued several additional ASUs to clarify implementation guidance, provide narrow-scope improvements and provide additional disclosure guidance. In November 2019, the FASB issued an amendment making this ASU effective for fiscal years beginning after December 15, 2022 for smaller reporting companies. The new standard will be effective for the Company on January 1, 2023 or at such time where it is no longer a smaller reporting company. The Company is currently evaluating the potential impact that the adoption of ASU 2016-13 may have on its condensed consolidated financial statements and related disclosures. In December 2019, the FASB issued ASU 2019-12, Income Taxes : Simplifying the Accounting for Income Taxes (Topic 740), which simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. ASU 2019-12 also improves consistent application and simplification of other areas of Topic 740 by clarifying and amending existing guidance. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020. The Company is currently evaluating the potential impact that the adoption of ASU 2019-12 may have on its condensed consolidated financial statements and related disclosures. In January 2020, the FASB issued ASU 2020-01, Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815, which addresses the accounting for the transition into and out of the equity method and provides clarification of the interaction of rules for equity securities, the equity method of accounting, and forward contracts and purchase options on certain types of securities. The amendments clarify that: (a) an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method; and (b) an entity should not consider whether, upon the settlement of the forward contract or exercise of the purchased option, individually or with existing investments, the underlying securities would be accounted for under the equity method in Topic 323 or the fair value option in accordance with the financial instruments guidance in Topic 825. The provisions of this guidance are to be applied prospectively upon their effective date. ASU 2020-01 is effective for fiscal years beginning after December 15, 2020, and interim periods within those years. Early adoption is permitted, but requires simultaneous adoption of all provisions of this guidance. The Company is currently evaluating the potential impact that the adoption of ASU 2020-01 may have on its condensed consolidated financial statements and related disclosures. In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. Specifically, ASU 2020-06 simplifies accounting for the issuance of convertible instruments by removing major separation models required under current GAAP. In addition, the ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and simplifies the diluted earnings per share (EPS) calculation in certain areas. ASU 2020-06 will be effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, beginning in fiscal years which begin after December 15, 2020, including interim periods within those fiscal years. The FASB has specified that an entity should adopt the guidance as of the beginning of its annual fiscal year. The Company is currently evaluating the potential impact that the adoption of ASU 2020-06 may have on its condensed consolidated financial statements and related disclosures. |
ORGANIZATION AND SUMMARY OF S_3
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Financial Liabilities Measured at Fair Value | The following table presents the Company’s financial liability that was measured at fair value as of December 31, 2019 (in thousands): LEVEL 1 LEVEL 2 LEVEL 3 TOTAL As of December 31, 2019 Derivative liability $ — $ — $ 1,916 $ 1,916 |
Reconciliation of Notes Measured at Fair Value Using Level 3 Unobservable Inputs | The following table provides a reconciliation of financial instruments measured at fair value using Level 3 unobservable inputs for the nine months ended September 30, 2020 (in thousands): Balance as of December 31, 2018 $ — Establishment of derivative liability on the 2019 Note 900 Change in fair value of derivative liability 1,016 Balance as of December 31, 2019 $ 1,916 Establishment of derivative liability on the 2020 Notes 735 Establishment of warrant liabilities on the 2020 Loan Agreement 115 Change in fair value of derivative liabilities on the 2019 and 2020 Notes (2,651) Change in fair value of warrant liabilities 24 Reclassification of warrant liabilities into equity (139) Balance as of September 30, 2020 $ — |
Schedule of Potential Dilutive Securities Excluded from Diluted Loss Per Share | The following securities that could potentially decrease net loss per share in the future were not included in the determination of diluted loss per share as their effect is anti-dilutive (in thousands): AS OF SEPTEMBER 30, 2020 2019 (1) Shares issuable upon conversion of convertible preferred stock — 7,211 Outstanding stock options 2,355 2,034 Convertible notes — 2,787 Warrants to purchase common stock 7 — 2,362 12,032 (1) The conversion of the convertible notes into common stock assumes a conversion price of $14.35 per share for the 2019 Note and $12.56 per share for the 2020 Notes, and includes the conversion of the principal balance and all accrued interest as of the stated date (see Note 5). |
OTHER FINANCIAL INFORMATION (Ta
OTHER FINANCIAL INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Prepaid Expense and Other Current Assets | Prepaid expense and other current assets were comprised of the following (in thousands): AS OF SEPTEMBER 30, AS OF DECEMBER 31, 2020 2019 (unaudited) Outside research and development services $ 2,245 $ 3,207 Other 972 376 Prepaid expense and other current assets $ 3,217 $ 3,583 |
Schedule of Property and Equipment | Property and equipment, net were comprised of the following (in thousands): AS OF SEPTEMBER 30, AS OF DECEMBER 31, 2020 2019 (unaudited) Machinery and equipment $ 5,085 $ 4,723 Leasehold improvements 441 344 Furniture and fixtures 498 317 Construction in process 350 229 Total property and equipment 6,374 5,613 Less: accumulated depreciation and amortization (3,100) (2,383) Property and equipment, net $ 3,274 $ 3,230 |
Schedule of Accrued Expenses | Accrued expenses were comprised of the following (in thousands): AS OF SEPTEMBER 30, AS OF DECEMBER 31, 2020 2019 (unaudited) Accrued research and development $ 9,866 $ 3,414 Accrued compensation expense 740 813 Professional fees 260 313 Other 171 292 Accrued expenses $ 11,037 $ 4,832 |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | As of December 31, 2019, the Company’s outstanding debt balance under the 2015 Loan Agreement consisted of the following (in thousands). AS OF DECEMBER 31, 2019 Term A $ 831 Term B 893 Term C 930 Term D 930 Add: debt discount (21) Total debt 3,563 Less: Current portion, including debt discount (3,563) Long-term debt, including debt discount $ — As of September 30, 2020, the Company’s outstanding debt balance under the 2020 Loan Agreement consisted of the following (in thousands). AS OF SEPTEMBER 30, 2020 Term loan $ 10,700 Add: debt discount (879) Total debt 9,821 Less: Current portion, including debt discount — Long-term debt, including debt discount $ 9,821 |
Schedule of Maturities of Long-term Debt | As of September 30, 2020, the total future minimum payments, which consist of the future contractual principal and final fee payments, on the Company’s debt are as follows (in thousands): AS OF SEPTEMBER 30, 2020 2020 $ — 2021 — 2022 1,667 2023 5,000 2024 4,033 Total future minimum payments $ 10,700 Less: unamortized debt discount $ (879) Total debt $ 9,821 |
CONVERTIBLE PROMISSORY NOTES (T
CONVERTIBLE PROMISSORY NOTES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Debt | As of December 31, 2019, the Company’s 2019 Note and the 2020 Notes balance, net of discount, consisted of the following (in thousands): AS OF DECEMBER 31, 2019 Principal amount $ 40,000 Unamortized debt discounts $ (9,633) Convertible note, net $ 30,367 |
STOCKHOLDERS_ EQUITY (DEFICIT)
STOCKHOLDERS’ EQUITY (DEFICIT) (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Schedule of Temporary Equity | Convertible preferred stock authorized and issued as of December 31, 2019 consisted of the following (in thousands, except share and per share amounts): AS OF DECEMBER 31,2019 Shares Authorized Shares Issued and Outstanding Issue Period Price Per Share Aggregate Liquidation Preference Series Mezzanine 1 4,299,319 4,299,319 2017 - 2018 $ 6.98 $ 30,009.2 Series Mezzanine 2 21,465,681 8,235,012 2018 - 2019 $ 6.98 57,480.4 Total 25,765,000 12,534,331 $ 87,489.6 |
EQUITY COMPENSATION PLANS (Tabl
EQUITY COMPENSATION PLANS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Options Roll Forward | A summary of the Company’s stock option activity under its 2017 Plan for the nine months ended September 30, 2020 is as follows (in thousands, except for per share data and years): NUMBER OF SHARES WEIGHTED AVERAGE EXERCISE PRICE WEIGHTED AVERAGE REMAINING CONTRACTUAL TERM (IN YEARS) AGGREGATE INTRINSIC VALUE Outstanding as of December 31, 2019 2,013 $ 10.92 9.0 $ 1,261 Granted 573 $ 12.05 9.6 $ 3,515 Exercised — $ 10.52 Forfeited (231) $ 11.15 Outstanding as of September 30, 2020 2,355 $ 11.17 8.3 $ 16,184 Vested and exercisable as of September 30, 2020 864 $ 10.83 7.7 $ 6,200 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The weighted-average assumptions used by the Company to estimate the fair value of stock option grants using the Black-Scholes option pricing model, as well as the resulting weighted-average fair value for the nine months ended September 30, 2020 and 2019 were as follows: NINE MONTHS ENDED SEPTEMBER 30, 2020 2019 (unaudited) Risk-free interest rate 0.41 % 2.07 % Expected volatility 97.78 % 87.43 % Expected dividend yield — % — % Expected term 6.08 6.08 Weighted average fair value $ 9.33 $ 9.82 |
Schedule of Stock-Based Compensation Expense | Stock-based compensation expense for stock options consisted of the following (in thousands): THREE MONTHS ENDED NINE MONTHS ENDED 2020 2019 2020 2019 Research and development $ 1,103 $ 877 $ 3,149 $ 2,449 General and administrative 200 142 501 401 Total stock-based compensation expense $ 1,303 $ 1,019 $ 3,650 $ 2,850 |
LICENSE AND GRANT REVENUES (Tab
LICENSE AND GRANT REVENUES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Schedule of License and Grant Revenue | The following table summarizes the total revenue recorded in the Company’s condensed consolidated statements of operations (in thousands): THREE MONTHS ENDED NINE MONTHS ENDED 2020 2019 2020 2019 License fee revenue from affiliates Transcenta Holding, Ltd. $ — $ — $ — $ 1,000 Elpiscience Biopharmaceuticals, Inc. 2,000 — 2,000 — Total license fee revenue from affiliates 2,000 — 2,000 1,000 License fee revenue from non-affiliates Phylaxis BioScience, LLC 809 — 809 — bluebird bio, Inc. — — 400 7,000 Chiesi Farmaceutici S.p.A. 1,967 794 5,773 794 Other license revenues from non-affiliates 1,050 — 1,050 32 Total license fee revenue from non-affiliates 3,826 794 8,032 7,826 Grant revenue National Institutes of Health — — — 880 Combating Antibiotic Resistant Bacteria Accelerator — 364 — 3,096 Congressionally Directed Medical Research Program 75 61 80 146 Total grant revenue 75 425 80 4,122 Total revenue $ 5,901 $ 1,219 $ 10,112 $ 12,948 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Operating Lease, by Balance Sheet Location | The right-of-use asset and operating lease liability as of September 30, 2020 and December 31, 2019 are as follows: AS OF SEPTEMBER 30, AS OF DECEMBER 31, 2020 2019 (unaudited) Right-of-use asset $ 8,185 $ 7,453 Operating lease liability Current $ 1,463 $ 1,105 Non-current $ 7,097 $ 6,698 Total operating lease liability $ 8,560 $ 7,803 |
Schedule of Operating Lease Maturity | Future minimum rental payments under operating leases are as follows (in thousands): AS OF SEPTEMBER 30, 2020 (unaudited) 2020 (3 months) $ 522 2021 2,119 2022 2,161 2023 2,203 2024 2,247 Thereafter 1,137 Total future minimum lease payments $ 10,389 Less: imputed interest (1,829) Present value of operating lease liability 8,560 Less: current portion of operating lease liability (1,463) Non-current portion of operating lease liability $ 7,097 |
ORGANIZATION AND SUMMARY OF S_4
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - IPO (Details) - USD ($) $ / shares in Units, $ in Millions | Aug. 21, 2020 | Sep. 30, 2020 | Dec. 31, 2019 |
Subsidiary, Sale of Stock [Line Items] | |||
Conversion of outstanding warrants to purchase convertible preferred stock into common stock (in shares) | 7,354 | ||
Common stock, shares authorized (in shares) | 120,000,000 | 120,000,000 | 65,000,000 |
Preferred stock, shares authorized (in shares) | 15,000,000 | 15,000,000 | 0 |
Common Stock | |||
Subsidiary, Sale of Stock [Line Items] | |||
Issuance of shares in conversion of convertible securities (in shares) | 7,211,086 | ||
Convertible Preferred Stock | Common Stock | |||
Subsidiary, Sale of Stock [Line Items] | |||
Issuance of shares in conversion of convertible securities (in shares) | 7,211,086 | 7,211,000 | |
2019 and 2020 Notes | Common Stock | |||
Subsidiary, Sale of Stock [Line Items] | |||
Issuance of shares in conversion of convertible securities (in shares) | 4,295,000 | ||
2019 and 2020 Notes | Convertible Debt | |||
Subsidiary, Sale of Stock [Line Items] | |||
Issuance of shares of common stock after conversion (in shares) | 4,294,603 | ||
IPO | |||
Subsidiary, Sale of Stock [Line Items] | |||
Sale of stock, shares issued (in shares) | 8,050,000 | ||
Sale of stock, price per share (in dollars per share) | $ 17 | ||
Sale of stock, proceeds received | $ 125.9 |
ORGANIZATION AND SUMMARY OF S_5
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) | Aug. 11, 2020 | Aug. 31, 2020USD ($) | Sep. 30, 2020USD ($)leasesegment | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($) |
Property, Plant and Equipment [Line Items] | |||||
Reverse stock split ratio | 0.5753 | ||||
Accumulated deficit | $ (127,730,000) | $ (69,255,000) | |||
Cash and cash equivalents | $ 127,669,000 | 11,540,000 | |||
Number of operating leases held | lease | 2 | ||||
Equity method investment | $ 0 | ||||
Derivative liabilities | 0 | $ 1,916,000 | |||
Costs associated with initial public offering | $ 11,000,000 | $ 10,558,000 | $ 0 | ||
Number of operating segments | segment | 1 | ||||
Affiliates | WuXi Biologics Healthcare Venture | |||||
Property, Plant and Equipment [Line Items] | |||||
Collaborative arrangement, term | 3 years | ||||
Minimum | Machinery and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment useful life | 3 years | ||||
Minimum | Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment useful life | 3 years | ||||
Minimum | Computer software | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment useful life | 4 years | ||||
Maximum | Machinery and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment useful life | 5 years | ||||
Maximum | Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment useful life | 5 years | ||||
Maximum | Computer software | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment useful life | 5 years |
ORGANIZATION AND SUMMARY OF S_6
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Financial Liabilities at Fair Value (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | $ 0 | $ 1,916,000 |
LEVEL 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | 0 | |
LEVEL 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | 0 | |
LEVEL 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | $ 1,916,000 |
ORGANIZATION AND SUMMARY OF S_7
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Reconciliation Measured at Fair Value Using Level 3 Inputs (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Warrant And Derivative Liabilities | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ 1,916 | $ 0 |
Ending balance | 0 | 1,916 |
Derivative liabilities | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Change in fair value of liabilities | 1,016 | |
Warrant liabilities | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Establishment of liabilities | 115 | |
Change in fair value of liabilities | 24 | |
Reclassification of liabilities into equity | (139) | |
2019 Convertible Note | Derivative liabilities | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Establishment of liabilities | $ 900 | |
2020 Convertible Note | Derivative liabilities | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Establishment of liabilities | 735 | |
2019 and 2020 Notes | Derivative liabilities | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Change in fair value of liabilities | $ (2,651) |
ORGANIZATION AND SUMMARY OF S_8
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Potential Dilutive Securities (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Antidilutive securities excluded from earnings per share computation (in shares) | 2,362,000 | 12,032,000 |
2019 Convertible Note | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Conversion price (in dollars per share) | $ 14.35 | |
2020 Convertible Note | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Conversion price (in dollars per share) | $ 12.56 | |
Convertible Preferred Stock | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Antidilutive securities excluded from earnings per share computation (in shares) | 0 | 7,211,000 |
Outstanding stock options | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Antidilutive securities excluded from earnings per share computation (in shares) | 2,355,000 | 2,034,000 |
Convertible notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Antidilutive securities excluded from earnings per share computation (in shares) | 0 | 2,787,000 |
Warrants to purchase common stock | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Antidilutive securities excluded from earnings per share computation (in shares) | 7,000 | 0 |
OTHER FINANCIAL INFORMATION - P
OTHER FINANCIAL INFORMATION - Prepaid Expense and Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Outside research and development services | $ 2,245 | $ 3,207 |
Other | 972 | 376 |
Prepaid expenses and other current assets | $ 3,217 | $ 3,583 |
OTHER FINANCIAL INFORMATION -_2
OTHER FINANCIAL INFORMATION - Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | $ 6,374 | $ 6,374 | $ 5,613 | ||
Less: accumulated depreciation and amortization | (3,100) | (3,100) | (2,383) | ||
Property and equipment, net | 3,274 | 3,274 | 3,230 | ||
Depreciation and amortization | 300 | $ 500 | 754 | $ 926 | |
Machinery and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | 5,085 | 5,085 | 4,723 | ||
Leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | 441 | 441 | 344 | ||
Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | 498 | 498 | 317 | ||
Construction in process | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | $ 350 | $ 350 | $ 229 |
OTHER FINANCIAL INFORMATION - A
OTHER FINANCIAL INFORMATION - Accrued Expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accrued research and development | $ 9,866 | $ 3,414 |
Accrued compensation expense | 740 | 813 |
Professional fees | 260 | 313 |
Other | 171 | 292 |
Accrued expenses | $ 11,037 | $ 4,832 |
DEBT - Outstanding Debt Balance
DEBT - Outstanding Debt Balance 2015 Loan Agreement (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Less: Current portion, including debt discount | $ 0 | $ (3,563) |
2015 Loan Agreement | Secured Debt | ||
Debt Instrument [Line Items] | ||
Add: debt discount | (21) | |
Total debt | 3,563 | |
Less: Current portion, including debt discount | (3,563) | |
Long-term debt, including debt discount | 0 | |
Term A | Secured Debt | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 831 | |
Term B | Secured Debt | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 893 | |
Term C | Secured Debt | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 930 | |
Term D | Secured Debt | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 930 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) | Jul. 15, 2020USD ($) | Mar. 15, 2015USD ($)loan$ / sharesshares | Sep. 30, 2020USD ($)$ / sharesshares | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($)$ / sharesshares | Sep. 30, 2019USD ($) | Aug. 31, 2020USD ($) | Mar. 31, 2020USD ($) |
Debt Instrument [Line Items] | ||||||||
Proceeds from the issuance of debt | $ 9,958,000 | $ 0 | ||||||
Warrants Issued Concurrently With 2020 Loan Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Common or preferred stock warrants issued as a percent of funded amount | 1.25% | |||||||
Warrants issued, amount | $ 125,000 | |||||||
Warrants Issued Concurrently With 2020 Loan Agreement | Preferred Stock | ||||||||
Debt Instrument [Line Items] | ||||||||
Warrants liability | $ 120,000 | |||||||
2015 Loan Agreement | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Number of term loans | loan | 4 | |||||||
Term loan aggregate amount | $ 20,000,000 | |||||||
Prepayment fee | 3.00% | |||||||
Percentage of principal amount for final payment | 7.00% | |||||||
Periodic payment terms, final payment amount | $ 1,400,000 | |||||||
Debt interest expense | $ 0 | $ 100,000 | $ 40,000 | $ 600,000 | ||||
2015 Loan Agreement | Secured Debt | Profit Interest Unit (PIU) | ||||||||
Debt Instrument [Line Items] | ||||||||
Awards granted in period (in shares) | shares | 33,650 | |||||||
Award issued, per unit value (in dollars per share) | $ / shares | $ 3.50 | |||||||
Value of awards issued | $ 100,000 | |||||||
Awards converted to common stock (in shares) | shares | 33,889 | |||||||
Term A | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Term loan aggregate amount | 5,000,000 | |||||||
Annual interest rate | 8.00% | 8.00% | ||||||
Term B | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Term loan aggregate amount | 5,000,000 | |||||||
Annual interest rate | 8.60% | 8.60% | ||||||
Term C | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Term loan aggregate amount | 5,000,000 | |||||||
Annual interest rate | 8.70% | 8.70% | ||||||
Term D | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Term loan aggregate amount | $ 5,000,000 | |||||||
Annual interest rate | 8.70% | 8.70% | ||||||
2020 Loan Agreement | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of principal amount for final payment | 7.00% | |||||||
Periodic payment terms, final payment amount | $ 700,000 | |||||||
Debt interest expense | $ 300,000 | $ 300,000 | ||||||
Proceeds from the issuance of debt | 10,000,000 | |||||||
Debt issuance costs | $ 100,000 | |||||||
Variable rate floor | 1.00% | |||||||
Interest-only payment period | 24 months | |||||||
Equal payments of principal and interest period | 24 months | |||||||
2020 Loan Agreement | Secured Debt | LIBOR | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 8.95% | |||||||
2020 Loan Agreement | Secured Debt | Warrants Issued Upon Consummation of IPO | ||||||||
Debt Instrument [Line Items] | ||||||||
Warrants liability | $ 140,000 | |||||||
Warrants exercisable for shares of common stock (in shares) | shares | 7,354 | 7,354 | ||||||
Warrant price (in dollars per share) | $ / shares | $ 17 | $ 17 | ||||||
2020 Loan Agreement | Secured Debt | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Prepayment fee | 1.00% | |||||||
2020 Loan Agreement | Secured Debt | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Prepayment fee | 3.00% |
DEBT - Outstanding Debt Balan_2
DEBT - Outstanding Debt Balance 2020 Loan Agreement (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Less: Current portion, including debt discount | $ 0 | $ (3,563) |
2020 Loan Agreement | Secured Debt | ||
Debt Instrument [Line Items] | ||
Term loan | 10,700 | |
Add: debt discount | (879) | |
Total debt | 9,821 | |
Less: Current portion, including debt discount | 0 | |
Long-term debt, including debt discount | $ 9,821 |
DEBT - Future Minimum Payments
DEBT - Future Minimum Payments (Details) - 2020 Loan Agreement - Secured Debt $ in Thousands | Sep. 30, 2020USD ($) |
Debt Instrument [Line Items] | |
2020 | $ 0 |
2021 | 0 |
2022 | 1,667 |
2023 | 5,000 |
2024 | 4,033 |
Total future minimum payments | 10,700 |
Less: unamortized debt discount | (879) |
Total debt | $ 9,821 |
PPP LOAN (Details)
PPP LOAN (Details) - USD ($) $ in Thousands | May 11, 2020 | Sep. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 |
Short-term Debt [Line Items] | |||||
Proceeds from the Paycheck Protection Program loan | $ 1,875 | $ 0 | |||
PPP loan | $ 1,875 | 1,875 | $ 0 | ||
Notes Payable, Other Payables | |||||
Short-term Debt [Line Items] | |||||
PPP loan | 1,900 | 1,900 | |||
PPP Loan | Notes Payable, Other Payables | |||||
Short-term Debt [Line Items] | |||||
Proceeds from the Paycheck Protection Program loan | $ 1,900 | ||||
Debt interest expense | $ 4 | $ 7 |
CONVERTIBLE PROMISSORY NOTES -
CONVERTIBLE PROMISSORY NOTES - Narrative (Details) - USD ($) | Aug. 21, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Aug. 21, 2020 | Apr. 30, 2020 | Apr. 06, 2020 | Feb. 29, 2020 | Dec. 31, 2019 | May 31, 2019 | May 20, 2019 |
Debt Instrument [Line Items] | ||||||||||||||
Company valuation | $ 400,000,000 | $ 400,000,000 | ||||||||||||
Other income related to changes in fair value of derivative liability | $ 0 | $ (3,476,000) | $ 2,651,000 | $ (3,476,000) | ||||||||||
Beneficial conversion feature (reversal of unamortized BCF) | $ 11,500,000 | |||||||||||||
Amortization of debt discount | 735,000 | $ 900,000 | ||||||||||||
Additional Paid-in Capital | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Beneficial conversion feature (reversal of unamortized BCF) | $ (7,400,000) | 11,500,000 | ||||||||||||
Convertible Debt | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Conversion price, as a percentage of stock price | 90.00% | |||||||||||||
Long-term debt | $ 30,367,000 | |||||||||||||
Derivative Liability | $ 0 | 1,900,000 | ||||||||||||
Other income related to changes in fair value of derivative liability | $ 2,700,000 | |||||||||||||
Unamortized debt discounts | $ 9,633,000 | |||||||||||||
Charge of amortized debt issuance costs to interest expense | $ 2,200,000 | |||||||||||||
2019 Convertible Note | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Company valuation | 400,000,000 | 400,000,000 | ||||||||||||
Conversion price (in dollars per share) | $ 14.35 | $ 14.35 | ||||||||||||
Beneficial conversion feature (reversal of unamortized BCF) | $ (5,332,000) | |||||||||||||
2019 Convertible Note | Additional Paid-in Capital | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Beneficial conversion feature (reversal of unamortized BCF) | $ (5,332,000) | |||||||||||||
2019 Convertible Note | Convertible Debt | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Note aggregate principal amount | $ 40,000,000 | |||||||||||||
Note monthly interest rate | 1.50% | |||||||||||||
Accrued interest expense | 3,700,000 | 3,700,000 | ||||||||||||
Long-term debt | $ 43,700,000 | $ 43,700,000 | ||||||||||||
Conversion price (in dollars per share) | $ 14.35 | $ 14.35 | ||||||||||||
Issuance of shares of common stock after conversion (in shares) | 3,046,467 | |||||||||||||
Fair value of bifurcated compound liability | $ 900,000 | |||||||||||||
Beneficial conversion feature (reversal of unamortized BCF) | $ 11,500,000 | |||||||||||||
Debt discount related to derivative liability | $ 900,000 | |||||||||||||
Debt issuance costs | $ 2,500,000 | |||||||||||||
Amortization of debt discount | $ 8,700,000 | |||||||||||||
Unamortized debt discounts | $ 6,900,000 | 6,900,000 | ||||||||||||
2020 Convertible Note | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Conversion price (in dollars per share) | $ 12.56 | $ 12.56 | ||||||||||||
Beneficial conversion feature (reversal of unamortized BCF) | $ (2,107,000) | 2,656,000 | ||||||||||||
2020 Convertible Note | Additional Paid-in Capital | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Beneficial conversion feature (reversal of unamortized BCF) | $ (2,107,000) | 2,656,000 | ||||||||||||
2020 Convertible Note | Convertible Debt | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Note aggregate principal amount | $ 15,000,000 | |||||||||||||
Note monthly interest rate | 1.00% | |||||||||||||
Company valuation | 350,000,000 | 350,000,000 | ||||||||||||
Accrued interest expense | 700,000 | 700,000 | ||||||||||||
Long-term debt | $ 15,700,000 | $ 15,700,000 | ||||||||||||
Conversion price (in dollars per share) | $ 12.56 | $ 12.56 | ||||||||||||
Issuance of shares of common stock after conversion (in shares) | 1,248,136 | |||||||||||||
Fair value of bifurcated compound liability | $ 700,000 | |||||||||||||
Beneficial conversion feature (reversal of unamortized BCF) | 2,700,000 | |||||||||||||
Debt discount related to derivative liability | $ 700,000 | |||||||||||||
Unamortized debt discounts | $ 2,700,000 | $ 2,700,000 |
CONVERTIBLE PROMISSORY NOTES _2
CONVERTIBLE PROMISSORY NOTES - Notes Balance, Net of Discount (Details) - Convertible Debt $ in Thousands | Dec. 31, 2019USD ($) |
Debt Instrument [Line Items] | |
Term loan | $ 40,000 |
Unamortized debt discounts | 9,633 |
Total debt | $ 30,367 |
STOCKHOLDERS_ EQUITY (DEFICIT_2
STOCKHOLDERS’ EQUITY (DEFICIT) (Details) - USD ($) | Aug. 21, 2020 | Sep. 30, 2020 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Dec. 31, 2018 |
Temporary Equity [Line Items] | ||||||||||
Common stock, shares authorized (in shares) | 120,000,000 | 120,000,000 | 120,000,000 | 65,000,000 | ||||||
Preferred stock, shares authorized (in shares) | 15,000,000 | 15,000,000 | 15,000,000 | 0 | ||||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Convertible preferred stock, shares authorized (in shares) | 0 | 0 | 25,765,000 | |||||||
Convertible preferred stock, shares issued (in shares) | 0 | 0 | 12,534,331 | |||||||
Convertible preferred stock, shares outstanding (in shares) | 0 | 12,534,000 | 0 | 12,534,000 | 12,534,331 | 12,534,000 | 12,534,000 | 12,534,000 | 10,815,000 | |
Convertible preferred stock, liquidation preferences | $ 0 | $ 0 | $ 87,489,600 | |||||||
Convertible preferred stock, shares issued (in shares) | 1,719,000 | |||||||||
Proceeds from the issuance of preferred stock | $ 0 | $ 12,000,000 | ||||||||
Reclassification of warrant liabilities to equity | $ 139,000 | |||||||||
Warrants Issued Upon Consummation of IPO | 2020 Loan Agreement | Secured Debt | ||||||||||
Temporary Equity [Line Items] | ||||||||||
Warrants exercisable for shares of common stock (in shares) | 7,354 | 7,354 | ||||||||
Warrant price (in dollars per share) | $ 17 | $ 17 | ||||||||
Common Stock | ||||||||||
Temporary Equity [Line Items] | ||||||||||
Issuance of shares in conversion of convertible securities (in shares) | 7,211,086 | |||||||||
Additional Paid-in Capital | ||||||||||
Temporary Equity [Line Items] | ||||||||||
Reclassification of warrant liabilities to equity | $ 140,000 | $ 139,000 | ||||||||
Series Mezzanine 1 | ||||||||||
Temporary Equity [Line Items] | ||||||||||
Convertible preferred stock, shares authorized (in shares) | 4,299,319 | |||||||||
Convertible preferred stock, shares issued (in shares) | 4,299,319 | |||||||||
Convertible preferred stock, shares outstanding (in shares) | 4,299,319 | |||||||||
Share price (in dollars per share) | $ 6.98 | |||||||||
Convertible preferred stock, liquidation preferences | $ 30,009,200 | |||||||||
Convertible preferred stock, shares issued (in shares) | 0 | |||||||||
Series Mezzanine 2 | ||||||||||
Temporary Equity [Line Items] | ||||||||||
Convertible preferred stock, shares authorized (in shares) | 21,465,681 | |||||||||
Convertible preferred stock, shares issued (in shares) | 8,235,012 | |||||||||
Convertible preferred stock, shares outstanding (in shares) | 8,235,012 | |||||||||
Share price (in dollars per share) | $ 6.98 | |||||||||
Convertible preferred stock, liquidation preferences | $ 57,480,400 | |||||||||
Convertible preferred stock, shares issued (in shares) | 0 | 1,700,000 | ||||||||
Proceeds from the issuance of preferred stock | $ 12,000,000 |
EQUITY COMPENSATION PLANS - Nar
EQUITY COMPENSATION PLANS - Narrative (Details) shares in Millions, $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020USD ($)planshares | Dec. 31, 2019USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of share-based compensation plans | plan | 1 | |
Common stock reserved for issuance (in shares) | 3 | |
Available shares reserved for issuance (in shares) | 0.6 | |
Employee Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 4 years | |
Contractual term | 10 years | |
Unrecognized stock-based compensation expense | $ | $ 12.3 | $ 12.2 |
Weighted-average period of recognition | 2 years 4 months 24 days | 2 years 10 months 24 days |
Cliff Vesting | Employee Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 1 year |
EQUITY COMPENSATION PLANS - Sto
EQUITY COMPENSATION PLANS - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
NUMBER OF SHARES | ||
Outstanding, beginning balance (in shares) | 2,013 | |
Granted (in shares) | 573 | |
Exercised (in shares) | 0 | |
Forfeited (in shares) | (231) | |
Outstanding, ending balance (in shares) | 2,355 | 2,013 |
Vested and exercisable (in shares) | 864 | |
WEIGHTED AVERAGE EXERCISE PRICE | ||
Outstanding, beginning balance (in dollars per share) | $ 10.92 | |
Granted (in dollars per share) | 12.05 | |
Exercised (in dollars per share) | 10.52 | |
Forfeited (in dollars per share) | 11.15 | |
Outstanding, ending balance (in dollars per share) | 11.17 | $ 10.92 |
Vested and exercisable (in dollars per share) | $ 10.83 | |
WEIGHTED AVERAGE REMAINING CONTRACTUAL TERM | 8 years 3 months 18 days | 9 years |
WEIGHTED AVERAGE REMAINING CONTRACTUAL TERM, Granted | 9 years 7 months 6 days | |
WEIGHTED AVERAGE REMAINING CONTRACTUAL TERM, Vested and exercisable | 7 years 8 months 12 days | |
AGGREGATE INTRINSIC VALUE | $ 16,184 | $ 1,261 |
AGGREGATE INTRINSIC VALUE, Granted | 3,515 | |
AGGREGATE INTRINSIC VALUE, Vested and exercisable | $ 6,200 |
EQUITY COMPENSATION PLANS - Fai
EQUITY COMPENSATION PLANS - Fair Value of Stock Option Grants (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average fair value (in dollars per share) | $ 9.33 | $ 9.82 |
Employee Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate | 0.41% | 2.07% |
Expected volatility | 97.78% | 87.43% |
Expected dividend yield | 0.00% | 0.00% |
Expected term | 6 years 29 days | 6 years 29 days |
EQUITY COMPENSATION PLANS - S_2
EQUITY COMPENSATION PLANS - Stock-based Compensation Expense (Details) - Employee Stock Option - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 1,303 | $ 1,019 | $ 3,650 | $ 2,850 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 1,103 | 877 | 2,449 | 3,149 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 200 | $ 142 | $ 401 | $ 501 |
LICENSE AND GRANT REVENUES - Re
LICENSE AND GRANT REVENUES - Revenue Summary (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 24 Months Ended | 25 Months Ended | ||||
Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2019 | Sep. 30, 2020 | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | $ 5,901,000 | $ 1,219,000 | $ 10,112,000 | $ 12,948,000 | |||||
License fee revenue, affiliates | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 2,000,000 | 0 | 2,000,000 | 1,000,000 | |||||
License fee revenue, affiliates | Transcenta Holding, Ltd. | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | $ 1,000,000 | 0 | 0 | 0 | 1,000,000 | ||||
License fee revenue, affiliates | Elpiscience | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | $ 2,000,000 | 2,000,000 | 0 | 2,000,000 | 0 | ||||
License fee revenue, non-affiliates | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 3,826,000 | 794,000 | 8,032,000 | 7,826,000 | |||||
License fee revenue, non-affiliates | Phylaxis BioScience, LLC | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 809,000 | 0 | 809,000 | 0 | |||||
License fee revenue, non-affiliates | bluebird bio, Inc. | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | $ 400,000 | 0 | 0 | 400,000 | 7,000,000 | ||||
License fee revenue, non-affiliates | Chiesi Farmaceutici S.p.A. | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 1,967,000 | 794,000 | 5,773,000 | 794,000 | |||||
License fee revenue, non-affiliates | Other license revenues from non-affiliates | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 1,050,000 | 0 | 1,050,000 | 32,000 | |||||
Grant revenue | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 75,000 | 425,000 | 80,000 | 4,122,000 | |||||
Grant revenue | National Institutes of Health | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 0 | 0 | 0 | 880,000 | |||||
Grant revenue | Combating Antibiotic Resistant Bacteria Accelerator | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 0 | 364,000 | 0 | 3,096,000 | $ 4,000,000 | ||||
Grant revenue | Congressionally Directed Medical Research Program | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | $ 75,000 | $ 61,000 | $ 80,000 | $ 146,000 | $ 300,000 |
LICENSE AND GRANT REVENUES - Li
LICENSE AND GRANT REVENUES - License and Collaboration Agreements (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||||||||||
Sep. 30, 2020USD ($)program | Jul. 31, 2020USD ($)performanceObligationcompound | Jun. 30, 2020USD ($)performanceObligationprogramlicense | Aug. 31, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Jan. 31, 2019USD ($) | Aug. 31, 2018USD ($) | Sep. 30, 2020USD ($)program | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($)program | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($) | Aug. 19, 2019performanceObligation | Dec. 20, 2018USD ($) | Apr. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Feb. 28, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2013USD ($) | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Equity method investment | $ 0 | $ 0 | $ 0 | |||||||||||||||||
Total revenue | 5,901,000 | $ 1,219,000 | $ 10,112,000 | $ 12,948,000 | ||||||||||||||||
Revenue, Performance Obligation, Description of Timing | The Company has identified one performance obligation as of the effective date of this agreement, which is to perform research and development services for Chiesi during the option period, which will continue (unless the Chiesi Option Agreement is terminated earlier by the Chiesi or the Company) until 60 days following the last to occur of (i) the Company’s delivery to Chiesi of the trial phase data for the first Phase I Clinical Trial, (ii) the Company’s delivery to Chiesi of the finalized minutes from the definitive U.S. Food and Drug Administration (“FDA”) scientific advice meeting conducted following completion of such Phase I Clinical Trial, and (iii) the Company’s delivery to Chiesi of the finalized minutes from the definitive parallel EMA-HTA scientific advice meeting conducted following completion of such Phase I Clinical Trial. | |||||||||||||||||||
License fee revenue, non-affiliates | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Total revenue | 3,826,000 | 794,000 | $ 8,032,000 | 7,826,000 | ||||||||||||||||
License fee revenue, affiliates | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Total revenue | 2,000,000 | 0 | $ 2,000,000 | 1,000,000 | ||||||||||||||||
Phylaxis BioScience, LLC | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Equity interest percentage | 10.00% | |||||||||||||||||||
Additional equity interest percentage entitled to receive | 5.00% | |||||||||||||||||||
Phylaxis BioScience, LLC | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Nonrefundable, upfront payment | $ 2,500,000 | |||||||||||||||||||
Additional payable due from agreement | 2,500,000 | |||||||||||||||||||
Additional payment receivable period | 180 days | |||||||||||||||||||
Development milestone payment receivable | 225,000,000 | |||||||||||||||||||
Commercialization milestone payment receivable | 175,000,000 | |||||||||||||||||||
Equity method investment | 500,000 | |||||||||||||||||||
Payments due pursuant to agreement | $ 5,000,000 | |||||||||||||||||||
Number of performance obligations | performanceObligation | 1 | |||||||||||||||||||
Number of compounds | compound | 2 | |||||||||||||||||||
Phylaxis BioScience, LLC | License fee revenue, non-affiliates | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Revenue recognized related to performance obligation | 800,000 | $ 800,000 | ||||||||||||||||||
Total revenue | 809,000 | 0 | 809,000 | 0 | ||||||||||||||||
bluebird bio, Inc. | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Nonrefundable, upfront payment | $ 7,000,000 | |||||||||||||||||||
Development milestone payment receivable | $ 51,500,000 | $ 51,500,000 | ||||||||||||||||||
Exclusive development license | license | 2 | |||||||||||||||||||
bluebird bio, Inc. | License fee revenue, non-affiliates | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Revenue recognized related to performance obligation | $ 7,000,000 | |||||||||||||||||||
Total revenue | $ 400,000 | 0 | 0 | 400,000 | 7,000,000 | |||||||||||||||
bluebird bio, Inc. | Initial Programs | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Nonrefundable, upfront payment | $ 400,000 | |||||||||||||||||||
Number of performance obligations | performanceObligation | 1 | |||||||||||||||||||
Number of programs related to collaborative agreement | program | 2 | |||||||||||||||||||
bluebird bio, Inc. | Initial Programs, Program 1 | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Nonrefundable, upfront payment | $ 200,000 | |||||||||||||||||||
bluebird bio, Inc. | Initial Programs, Program 2 | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Nonrefundable, upfront payment | $ 200,000 | |||||||||||||||||||
bluebird bio, Inc. | Additional Programs | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Number of programs related to collaborative agreement | program | 8 | |||||||||||||||||||
Chiesi Farmaceutici S.p.A. | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Nonrefundable, upfront payment | $ 10,000,000 | |||||||||||||||||||
Additional payable due from agreement | 12,500,000 | |||||||||||||||||||
Number of performance obligations | performanceObligation | 1 | |||||||||||||||||||
Milestone payments receivable | $ 122,500,000 | |||||||||||||||||||
Chiesi Farmaceutici S.p.A. | License fee revenue, non-affiliates | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Revenue recognized related to performance obligation | 2,000,000 | 800,000 | 5,800,000 | 800,000 | ||||||||||||||||
Total revenue | $ 1,967,000 | 794,000 | $ 5,773,000 | 794,000 | ||||||||||||||||
Elpiscience | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
License agreements | program | 2 | 2 | 2 | |||||||||||||||||
Elpiscience | License fee revenue, affiliates | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Total revenue | $ 2,000,000 | $ 2,000,000 | 0 | $ 2,000,000 | 0 | |||||||||||||||
Elpiscience | PD-L1 and 4-1BB License Agreement | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Total revenue | 0 | 0 | 0 | 0 | ||||||||||||||||
Milestone payments receivable | $ 100,000,000 | |||||||||||||||||||
Liabilities related to reimbursement of agreement | 0 | 0 | $ 3,000,000 | |||||||||||||||||
Liabilities derecognized from agreements | 0 | 700,000 | ||||||||||||||||||
Elpiscience | OX40 License Agreement | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Additional payable due from agreement | 100,000 | 100,000 | 100,000 | |||||||||||||||||
Total revenue | 2,000,000 | 0 | 2,000,000 | 0 | ||||||||||||||||
Milestone payments receivable | $ 100,000,000 | |||||||||||||||||||
Reimbursement expenses | $ 3,400,000 | 0 | 200,000 | |||||||||||||||||
Liabilities related to reimbursement of agreement | 0 | 0 | 0 | $ 0 | ||||||||||||||||
Liabilities derecognized from agreements | 100,000 | 1,300,000 | ||||||||||||||||||
Receivable for expenses incurred, not yet reimbursed | $ 200,000 | 200,000 | 200,000 | |||||||||||||||||
Transcenta Holding, Ltd. | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Milestone payments receivable | $ 100,000,000 | |||||||||||||||||||
Transcenta Holding, Ltd. | License fee revenue, affiliates | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Total revenue | $ 1,000,000 | $ 0 | $ 0 | $ 0 | $ 1,000,000 | |||||||||||||||
Foreign tax withholding | $ 100,000 | |||||||||||||||||||
Celgene | ||||||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||||||||||
Milestone payments receivable | $ 934,100,000 | |||||||||||||||||||
Percentage due to advisors | 0.02 |
LICENSE AND GRANT REVENUES - Go
LICENSE AND GRANT REVENUES - Government Grants (Details) | 3 Months Ended | 9 Months Ended | 24 Months Ended | 25 Months Ended | |||||
Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2018USD ($) | Aug. 31, 2017USD ($) | Jul. 31, 2017USD ($) | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | $ 5,901,000 | $ 1,219,000 | $ 10,112,000 | $ 12,948,000 | |||||
National Institutes of Health | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Grant award | $ 1,000,000 | ||||||||
Combating Antibiotic Resistant Bacteria Accelerator | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Grant award | $ 4,600,000 | ||||||||
Cost share, percentage reimbursed by sponsor | 0.70 | ||||||||
Cost share, percentage covered by company | 0.30 | ||||||||
Congressionally Directed Medical Research Program | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Grant award | $ 300,000 | ||||||||
Grant revenue | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 75,000 | 425,000 | 80,000 | 4,122,000 | |||||
Grant revenue | National Institutes of Health | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 0 | 0 | 0 | 880,000 | |||||
Grant revenue | Combating Antibiotic Resistant Bacteria Accelerator | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | 0 | 364,000 | 0 | 3,096,000 | $ 4,000,000 | ||||
Grant revenue | Congressionally Directed Medical Research Program | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | $ 75,000 | $ 61,000 | $ 80,000 | $ 146,000 | $ 300,000 | ||||
Grant revenue | Congressionally Directed Medical Research Program, Cash from DoD | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||||||||
Total revenue | $ 200,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Sep. 30, 2020 | Jun. 30, 2019 | Jan. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | |||||||||
Total revenue | $ 5,901,000 | $ 1,219,000 | $ 10,112,000 | $ 12,948,000 | |||||
Convertible preferred stock, shares issued (in shares) | 1,719,000 | ||||||||
Proceeds from issuance of stock | $ 11,988,000 | ||||||||
Series Mezzanine 2 | |||||||||
Related Party Transaction [Line Items] | |||||||||
Convertible preferred stock, shares issued (in shares) | 0 | 1,700,000 | |||||||
Share price (in dollars per share) | $ 6.98 | ||||||||
License fee revenue, affiliates | |||||||||
Related Party Transaction [Line Items] | |||||||||
Total revenue | 2,000,000 | 0 | $ 2,000,000 | 1,000,000 | |||||
Transcenta Holding, Ltd. | License fee revenue, affiliates | |||||||||
Related Party Transaction [Line Items] | |||||||||
Total revenue | $ 1,000,000 | 0 | 0 | 0 | 1,000,000 | ||||
Elpiscience | License fee revenue, affiliates | |||||||||
Related Party Transaction [Line Items] | |||||||||
Total revenue | $ 2,000,000 | 2,000,000 | 0 | 2,000,000 | 0 | ||||
Elpiscience | PD-L1 and 4-1BB License Agreement | |||||||||
Related Party Transaction [Line Items] | |||||||||
Total revenue | 0 | 0 | 0 | 0 | |||||
Reimbursement for related party transaction expenses incurred to date | 4,700,000 | 4,700,000 | 4,700,000 | $ 4,700,000 | |||||
Elpiscience | OX40 License Agreement | |||||||||
Related Party Transaction [Line Items] | |||||||||
Total revenue | 2,000,000 | $ 0 | 2,000,000 | $ 0 | |||||
Reimbursement for related party transaction expenses incurred to date | $ 5,100,000 | $ 5,100,000 | $ 5,100,000 | $ 4,900,000 | |||||
Affiliates | LAV Summit Limited | |||||||||
Related Party Transaction [Line Items] | |||||||||
Ownership interest, more than | 5.00% | 5.00% | 5.00% | 5.00% | |||||
Affiliates | WuXi Biologics Healthcare Venture | Series Mezzanine 2 | |||||||||
Related Party Transaction [Line Items] | |||||||||
Convertible preferred stock, shares issued (in shares) | 1,700,000 | ||||||||
Share price (in dollars per share) | $ 6.98 | ||||||||
Proceeds from issuance of stock | $ 12,000,000 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Narrative (Details) ft² in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Dec. 31, 2019 | May 31, 2019USD ($)ft² | Sep. 30, 2017USD ($)ft² | |
Commitments and Contingencies Disclosure [Abstract] | |||||||
Lease agreement term | 7 years | ||||||
Square footage of lease agreement (in sq feet) | ft² | 34 | ||||||
Lease extension term | 5 years | ||||||
Initial base rent per month | $ | $ 30 | $ 100 | |||||
Annual escalations | 2.00% | 2.00% | |||||
Square footage of lease extension agreement (in sq feet) | ft² | 9 | ||||||
Operating lease expense | $ | $ 800 | $ 600 | $ 2,300 | $ 1,700 | |||
Remaining term of operating lease | 4 years 9 months 18 days | 4 years 9 months 18 days | 5 years 6 months | ||||
Weighted-average discount rate | 8.20% | 8.20% | 8.00% |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Schedule of Right-Of-Use Asset and Operating Lease Liability (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Commitments and Contingencies Disclosure [Abstract] | ||
Right-of-use asset | $ 8,185 | $ 7,453 |
Operating lease liability | ||
Current portion of lease liability | 1,463 | 1,105 |
Non-current portion of lease liability | 7,097 | 6,698 |
Present value of operating lease liability | $ 8,560 | $ 7,803 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES - Schedule of Operating Lease Liability Maturity (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Commitments and Contingencies Disclosure [Abstract] | ||
2020 (3 months) | $ 522 | |
2021 | 2,119 | |
2022 | 2,161 | |
2023 | 2,203 | |
2024 | 2,247 | |
Thereafter | 1,137 | |
Total future minimum lease payments | 10,389 | |
Less: imputed interest | (1,829) | |
Present value of operating lease liability | 8,560 | $ 7,803 |
Current portion of lease liability | (1,463) | (1,105) |
Non-current portion of lease liability | $ 7,097 | $ 6,698 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | Nov. 12, 2020 | Jul. 15, 2020 | Oct. 31, 2020 |
Secured Debt | 2020 Loan Agreement | |||
Subsequent Event [Line Items] | |||
Equal payments of principal and interest period | 24 months | ||
Percentage of principal amount for final payment | 7.00% | ||
Secured Debt | 2020 Loan Agreement | Minimum | |||
Subsequent Event [Line Items] | |||
Prepayment fee | 1.00% | ||
Secured Debt | 2020 Loan Agreement | Maximum | |||
Subsequent Event [Line Items] | |||
Prepayment fee | 3.00% | ||
Secured Debt | 2020 Loan Agreement | LIBOR | |||
Subsequent Event [Line Items] | |||
Basis spread on variable rate | 8.95% | ||
Secured Debt | First Tranche | |||
Subsequent Event [Line Items] | |||
Term loan aggregate amount | $ 10,000,000 | ||
Annual interest rate, floor | 7.96% | ||
Secured Debt | First Tranche | LIBOR | |||
Subsequent Event [Line Items] | |||
Basis spread on variable rate | 7.80% | ||
Subsequent Event | Secured Debt | 2020 Loan Agreement | |||
Subsequent Event [Line Items] | |||
Payment for debt restructuring costs | $ 700,000 | ||
Percentage of principal amount for final payment | 9.00% | ||
Subsequent Event | Secured Debt | 2020 Loan Agreement | Minimum | |||
Subsequent Event [Line Items] | |||
Prepayment fee | 1.00% | ||
Subsequent Event | Secured Debt | 2020 Loan Agreement | Maximum | |||
Subsequent Event [Line Items] | |||
Prepayment fee | 3.00% | ||
Subsequent Event | Secured Debt | Second and Third Tranches | |||
Subsequent Event [Line Items] | |||
Term loan aggregate amount | $ 40,000,000 | ||
Subsequent Event | Secured Debt | Tranche B | |||
Subsequent Event [Line Items] | |||
Term loan aggregate amount | 20,000,000 | ||
Subsequent Event | Secured Debt | Tranche C | |||
Subsequent Event [Line Items] | |||
Term loan aggregate amount | $ 20,000,000 | ||
Interest only payments, extended term | 12 months | ||
Equal payments of principal and interest period | 23 months | ||
Equal payments of principal and interest, extended term | 11 months | ||
Subsequent Event | Notes Payable, Other Payables | PPP Loan | |||
Subsequent Event [Line Items] | |||
Accrued interest | $ 7,400 | ||
Repayment of loan | $ 1,900,000 |