Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 08, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | CABA | |
Entity Registrant Name | CABALETTA BIO, INC. | |
Entity Current Reporting Status | Yes | |
Entity Central Index Key | 0001759138 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Shell Company | false | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 24,034,022 | |
Entity File Number | 001-39103 | |
Entity Tax Identification Number | 82-1685768 | |
Entity Address, Address Line One | 2929 Arch Street | |
Entity Address, Address Line Two | Suite 600 | |
Entity Address, City or Town | Philadelphia | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 19104 | |
City Area Code | 267 | |
Local Phone Number | 759-3100 | |
Entity Interactive Data Current | Yes | |
Title of 12(b) Security | Common Stock, par value $0.00001 per share | |
Security Exchange Name | NASDAQ | |
Entity Incorporation, State or Country Code | DE | |
Document Quarterly Report | true | |
Document Transition Report | false |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 131,003 | $ 136,204 |
Prepaid expenses and other current assets | 3,119 | 4,348 |
Total current assets | 134,122 | 140,552 |
Property and equipment, net | 739 | 815 |
Other assets | 104 | 101 |
Total Assets | 134,965 | 141,468 |
Current liabilities: | ||
Accounts payable | 1,991 | 920 |
Accrued and other current liabilities | 1,265 | 2,227 |
Total current liabilities | 3,256 | 3,147 |
Commitments and Contingencies (see Note 5) | ||
Stockholders’ equity: | ||
Preferred stock, $0.00001 par value: 10,000,000 shares authorized as of March 31, 2020 and December 31, 2019, respectively; no shares issued or outstanding at March 31, 2020 and December 31, 2019, respectively | ||
Voting and non-voting common stock, $0.00001 par value: 150,000,000 (143,590,481 voting shares and 6,409,519 non-voting shares) shares authorized at March 31, 2020 and December 31, 2019, respectively; 24,034,022 (17,624,503 voting shares and 6,409,519 non-voting shares) shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively | 0 | 0 |
Additional paid-in capital | 172,153 | 171,280 |
Accumulated deficit | (40,444) | (32,959) |
Total stockholders’ equity | 131,709 | 138,321 |
Total liabilities and stockholders’ equity | $ 134,965 | $ 141,468 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, authorized shares | 10,000,000 | 10,000,000 |
Preferred stock, issued shares | 0 | 0 |
Preferred stock, outstanding shares | 0 | 0 |
Common stock, authorized shares | 150,000,000 | 150,000,000 |
Common stock, issued shares | 24,034,022 | 24,034,022 |
Common stock, outstanding shares | 24,034,022 | 24,034,022 |
Voting Common Stock | ||
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, authorized shares | 143,590,481 | 143,590,481 |
Common stock, issued shares | 17,624,503 | 17,624,503 |
Common stock, outstanding shares | 17,624,503 | 17,624,503 |
Non-voting Common Stock | ||
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, authorized shares | 6,409,519 | 6,409,519 |
Common stock, issued shares | 6,409,519 | 6,409,519 |
Common stock, outstanding shares | 6,409,519 | 6,409,519 |
Condensed Statements of Operati
Condensed Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating expenses: | ||
Research and development | $ 4,620 | $ 2,761 |
General and administrative | 3,275 | 1,229 |
Total operating expenses | 7,895 | 3,990 |
Loss from operations | (7,895) | (3,990) |
Other income: | ||
Interest income | 410 | 458 |
Net loss | (7,485) | (3,532) |
Deemed dividend | (5,326) | |
Net loss attributable to common stockholders | $ (7,485) | $ (8,858) |
Net loss per share of voting and non-voting common stock, basic and diluted | $ (0.33) | $ (6.05) |
Condensed Statements of Convert
Condensed Statements of Convertible Preferred Stock and Stockholders' (Deficit) Equity (Unaudited) - USD ($) $ in Thousands | Total | Convertible Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit |
Beginning balance at Dec. 31, 2018 | $ 43,921 | ||||
Beginning balance, Shares at Dec. 31, 2018 | 12,393,047 | ||||
Beginning balance at Dec. 31, 2018 | $ (10,690) | $ 1,762 | $ (12,452) | ||
Beginning balance, Shares at Dec. 31, 2018 | 3,848,320 | ||||
Issuance of convertible preferred stock, net of issuance costs | $ 48,707 | ||||
Issuance of convertible preferred stock, net of issuance cost, Shares | 6,963,788 | ||||
Exchange of convertible preferred stock, including deemed dividend | (5,326) | $ 5,326 | (2,258) | (3,068) | |
Stock-based compensation | 496 | 496 | |||
Net loss | (3,532) | (3,532) | |||
Ending balance at Mar. 31, 2019 | $ 97,954 | ||||
Ending balance, Shares at Mar. 31, 2019 | 19,356,835 | ||||
Ending balance at Mar. 31, 2019 | (19,052) | (19,052) | |||
Ending balance, Shares at Mar. 31, 2019 | 3,848,320 | ||||
Beginning balance, Shares at Dec. 31, 2019 | 0 | ||||
Beginning balance at Dec. 31, 2019 | $ 138,321 | 171,280 | (32,959) | ||
Beginning balance, Shares at Dec. 31, 2019 | 24,034,022 | 24,034,022 | |||
Stock-based compensation | $ 873 | 873 | |||
Net loss | (7,485) | (7,485) | |||
Ending balance, Shares at Mar. 31, 2020 | 0 | ||||
Ending balance at Mar. 31, 2020 | $ 131,709 | $ 172,153 | $ (40,444) | ||
Ending balance, Shares at Mar. 31, 2020 | 24,034,022 | 24,034,022 |
Condensed Statements of Conve_2
Condensed Statements of Convertible Preferred Stock and Stockholders' (Deficit) Equity (Unaudited) (Parenthetical) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Issuance costs | $ 216 |
Convertible Preferred Stock | |
Issuance costs | $ 1,293 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (7,485) | $ (3,532) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation | 873 | 496 |
Depreciation | 76 | |
Prepaid expenses and other current assets | 1,230 | 749 |
Other assets | (4) | (28) |
Accounts payable | 1,176 | (302) |
Accrued and other current liabilities | (797) | 352 |
Net cash used in operating activities | (4,931) | (2,265) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (226) | (180) |
Net cash used in investing activities | (226) | (180) |
Cash flows from financing activities: | ||
Proceeds from issuance of convertible preferred stock | 50,000 | |
Issuance costs of convertible preferred stock | (216) | |
Issuance costs of common stock | (44) | |
Payment of deferred offering costs | (121) | |
Net cash (used in) provided by financing activities | (44) | 49,663 |
Net (decrease) increase in cash and cash equivalents | (5,201) | 47,218 |
Cash and cash equivalents—beginning of period | 136,204 | 33,017 |
Cash and cash equivalents—end of period | 131,003 | 80,235 |
Supplemental disclosures of non-cash investing and financing activities: | ||
Exchange of convertible preferred stock, including deemed dividend | 10,090 | |
Issuance costs included in accounts payable | $ 147 | 1,077 |
Deferred offering costs in accrued expenses and accounts payable | $ 547 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | 1. Basis of Presentation Cabaletta Bio, Inc. (the Company or Cabaletta) was incorporated in April 2017 in the State of Delaware as Tycho Therapeutics, Inc. and, in August 2018, changed its name to Cabaletta Bio, Inc. The Company is headquartered in Pennsylvania. Cabaletta is a clinical-stage biotechnology company focused on the discovery and development of engineered T cell therapies for B cell-mediated autoimmune diseases. Principal operations commenced in April 2018, when the Company executed sponsored research agreements with the Trustees of the University of Pennsylvania (Penn). On October 16, 2019, the Company effected a 1-for-1.5 reverse split of the Company’s issued and outstanding shares of common stock, par value $0.00001 per share. Upon the effectiveness of the reverse stock split: (i) all shares of outstanding common stock were adjusted; (ii) the conversion price of the Series A convertible preferred stock (Series A Preferred), Series A-1 convertible preferred stock (Series A-1 Preferred), Series A-2 convertible preferred stock (Series A-2 Preferred) and Series B convertible preferred stock (Series B Preferred; collectively, the Convertible Preferred Stock) was adjusted; (iii) the number of shares of common stock for which each outstanding option to purchase common stock is exercisable was adjusted; and (iv) the exercise price of each outstanding option to purchase common stock was adjusted. All of the outstanding common stock share numbers (including shares of common stock subject to the Company’s options and as converted for the outstanding Convertible Preferred Stock shares), share prices, exercise prices and per share amounts contained in the financial statements have been retroactively adjusted in the financial statements to reflect this reverse stock split for all periods presented. The par value per share and the authorized number of shares of common stock and Convertible Preferred Stock were not adjusted as a result of the reverse stock split. On October 29, 2019, the Company completed its initial public offering (IPO) of 6,800,000 shares of common stock at an offering price of $11.00 per share. The Company received net proceeds of $66,156 after deducting underwriting discounts, commissions and estimated offering expenses. In connection with the IPO, the Company’s outstanding shares of Convertible Preferred Stock were automatically converted into 12,904,534 shares of common stock. In November 2019, the underwriters partially exercised their option and purchased an additional 475,501 shares of common stock resulting in net proceeds to the Company of approximately $4,864, after deducting underwriting discounts and commissions. Risks and Uncertainties The Company does not expect to generate revenue from sales of engineered T cell therapies for B cell-mediated autoimmune diseases or any other revenue unless and until the Company completes preclinical and clinical development and obtains regulatory approval for one or more product candidates. If the Company seeks to obtain regulatory approval for any of its product candidates, the Company expects to incur significant commercialization expenses. The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, new technological innovations, protection of proprietary technology, dependence on key personnel, compliance with government regulations and the need to obtain additional financing. As a result, the Company is unable to predict the timing or amount of increased expenses or when or if the Company will be able to achieve or maintain profitability. Further, the Company is currently dependent on Penn for much of its preclinical research, clinical research and development activities, and expects to be dependent upon Penn for initial manufacturing activities (Note 5). Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval, prior to commercialization. Even if the Company is able to generate revenues from the sale of its product candidates, if approved, it may not become profitable. If the Company fails to become profitable or is unable to sustain profitability on a continuing basis, then it may be unable to continue its operations at planned levels and be forced to reduce its operations. In December 2019, a novel strain of coronavirus (COVID-19) was reported to have surfaced in Wuhan, China. As of May 2020, COVID-19 has spread to other countries, including Europe and the United States, and has been declared a pandemic by the World Health Organization. Efforts to contain the spread of COVID-19 have intensified and the United States, Europe and Asia have implemented severe travel restrictions, social distancing requirements, stay-at-home orders and have delayed the commencement of non-COVID-19-related clinical trials, among other restrictions. The Company’s financial results for the three months ended March 31, 2020 were not significantly impacted by COVID-19, however, the Company cannot at this time predict the specific extent, duration, or full impact that the COVID-19 pandemic will have on its financial condition, operations, and business plans for 2020, including the timing and enrollment of patients in its planned clinical trials and other expected milestones of its product candidates. Liquidity The Company has sustained annual operating losses and expects to continue to generate operating losses for the foreseeable future. The Company’s ultimate success depends on the outcome of its research and development activities. The Company had cash and cash equivalents of $131,003 as of March 31, 2020. Through March 31, 2020, the Company has incurred an accumulated deficit of $40,444. Management expects to incur additional losses in the future as it continues its research and development and will need to raise additional capital to fully implement its business plan and to fund its operations. The Company intends to raise such additional capital through a combination of equity offerings, debt financings, government funding arrangements, strategic alliances or other sources. However, if such financing is not available at adequate levels and on a timely basis, or such agreements are not available on favorable terms, or at all, as and when needed, the Company will need to reevaluate its operating plan and may be required to delay or discontinue the development of one or more of its product candidates or operational initiatives. The Company expects that its cash and cash equivalents as of March 31, 2020, will be sufficient to fund its projected operations for at least 12 months following the date of these financial statements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Unaudited Interim Financial Information The accompanying unaudited interim financial statements have been prepared in conformity with generally accepted accounting principles (GAAP) and the applicable rules and regulations of the Securities and Exchange Commission (SEC) regarding interim financial reporting. Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification and Accounting Standards Updates (ASU) of the Financial Accounting Standards Board (FASB). As permitted under these rules, certain footnotes and other financial information that are normally required by GAAP have been condensed or omitted. In the opinion of management, the accompanying unaudited interim financial statements include all normal and recurring adjustments (which consist primarily of accruals and estimates that impact the financial statements) considered necessary to present fairly the Company’s financial position as of March 31, 2020 and the results of its operations and its cash flows for the three months ended March 31, 2020 and 2019. The results for the three months ended March 31, 2020 are not necessarily indicative of results to be expected for the year ending December 31, 2020, any other interim periods, or any future year or period. The balance sheet as of December 31, 2019 included herein was derived from the audited financial statements as of that date. The unaudited interim financial statements, presented herein, do not contain the required disclosures under GAAP for annual financial statements. These unaudited financial statements should be read in conjunction with the Company’s audited financial statements, which are included in the Company’s 2019 Annual Report on Form 10-K, filed with the SEC on March 30, 2020 (2019 Annual Report). Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of expenses during the reporting period. Significant estimates and assumptions made in the accompanying financial statements include, but are not limited to, the fair value of common stock, stock-based compensation and the valuation allowance on the Company’s deferred tax assets. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could differ from those estimates. Off-Balance Sheet Risk and Concentrations of Credit Risk Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist primarily of cash and cash equivalents, which are primarily invested in U.S. treasury-based money market funds. A portion of the Company’s cash is maintained at a federally insured financial institution. The deposits held at this institution are in excess of federally insured limits. The Company has not experienced any losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institution in which those deposits are held. The cash in this account is swept daily into U.S. treasury-based and U.S. government-based money market funds. The Company has no off‑balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Significant Accounting Policies There have been no significant changes to the Company’s accounting policies during the three months ended March 31, 2020, as compared to the significant accounting policies described in Note 2 of the “Notes to the Financial Statements” in the Company’s audited financial statements included in its 2019 Annual Report. Fair Value Measurement Assets and liabilities recorded at fair value on a recurring basis in the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair values. Fair value is defined as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The authoritative guidance on fair value measurements establishes a three-tier fair value hierarchy for disclosure of fair value measurements as follows: Level 1—Observable inputs such as unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2—Inputs (other than quoted prices included in Level 1) that are either directly or indirectly observable for the asset or liability. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. 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. Related Party Transactions The Company engaged a firm controlled by a former executive (until February 2019) of the Company for professional services related to accounting, finance and other administrative functions. For the three months ended March 31, 2020 and 2019, the costs incurred under this arrangement totaled $151 and $187, respectively. As of March 31, 2020 and December 31, 2019, amounts owed under this arrangement totaled $95 and $36, respectively, and are included in accounts payable in the accompanying balance sheets. Emerging Growth Company Status The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates. Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 3. Fair Value Measurements Fair value of financial instruments At March 31, 2020 and December 31, 2019, the Company’s financial instruments included cash and cash equivalents, accounts payable and accrued expenses. The carrying amounts reported in the Company's financial statements for these instruments approximate their respective fair values because of the short-term nature of these instruments. The following tables present financial information about the Company’s financial assets measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values: March 31, 2020 Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets Cash equivalents: Money market funds $ 131,003 $ 131,003 $ — $ — Total $ 131,003 $ 131,003 $ — $ — December 31, 2019 Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets Cash equivalents: Money market funds $ 136,204 $ 136,204 $ — $ — Total $ 136,204 $ 136,204 $ — $ — |
Accrued and Other Current Liabi
Accrued and Other Current Liabilities | 3 Months Ended |
Mar. 31, 2020 | |
Payables And Accruals [Abstract] | |
Accrued and Other Current Liabilities | 4. Accrued and Other Current Liabilities Accrued and other current liabilities consist of the following: March 31, 2020 December 31, 2019 Research and development services $ 469 $ 231 General and administrative services 132 297 Compensation expense 563 1,522 Other 101 177 $ 1,265 $ 2,227 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 5. Commitments and Contingencies Operating Lease Agreement In February 2019, the Company entered into an operating lease agreement for new office space in Philadelphia, Pennsylvania. The lease term commenced in May 2019 and will expire in July 2022. The initial annual base rent is $261, and such amount will increase by 2% annually on each anniversary of the commencement date. The Company records rent expense on a straight-line basis over the lease term. Rent expense related to this lease agreement recognized in the accompanying statements of operations was $67 for the three months ended March 31, 2020. As of March 31, 2020, the future minimum payments for operating leases are as follows: April 1, 2020 to December 31, 2020 $ 198 2021 268 2022 158 Thereafter — $ 624 Research Service Agreement In August 2018, the Company entered into a research service agreement with the Children’s Hospital of Philadelphia (CHOP) for the manufacturing of preclinical study and clinical trial material. Research and development expense related to this research service agreement with CHOP recognized in the accompanying statements of operations was $0 and $179 for the three months ended March 31, 2020 and 2019, respectively. There were no amounts due under the research service agreement with CHOP as of March 31, 2020. License Agreement with the Trustees of the University of Pennsylvania In August 2018, the Company entered into a license agreement with Penn (the Penn Agreement) and activated the license in October 2018 pursuant to which the Company obtained (a) a non-exclusive, non-sublicensable worldwide license to certain of Penn’s intellectual property to conduct research, product development, clinical trials, cell manufacturing and other activities, and (b) an exclusive, worldwide, royalty-bearing right and license, with a right to sublicense, on a target-by-target basis, under certain of Penn’s intellectual property to make, use, sell, offer for sale, import, and otherwise commercialize products for the treatment of autoimmune and alloimmune diseases. In July 2019, the Penn Agreement was amended and restated to include CHOP as a party to the agreement. Unless earlier terminated, the Penn Agreement expires on the expiration or abandonment or other termination of the last valid claim in Penn’s intellectual property licensed by the Company. The Company may terminate the Penn Agreement at any time for convenience upon 60 days written notice. In the event of an uncured, material breach, Penn may terminate the Penn Agreement upon 60 days written notice. Under the terms of the Penn Agreement, the Company is obligated to pay $2,000 annually for three years beginning August 2018 for funding to the laboratories of each of Drs. Milone and Payne (see Sponsored Research Agreements—Penn The Company is required to pay certain milestone payments upon the achievement of specified clinical and commercial milestones. Milestone payments are reduced by a certain percentage for the second product that achieves a milestone, by an additional percentage for the third product that achieves a milestone, and so on, for each subsequent product that achieves a milestone. In the event that the Company is able to successfully develop and launch multiple products under the Penn Agreement, total milestone payments could approach $20,000. Penn is also eligible to receive tiered royalties at percentage rates in the low single-digits, subject to an annual minimum royalty, on annual worldwide net sales of any products that are commercialized by the Company or its sublicensees that contain or incorporate, or are covered by, the intellectual property licensed by the Company. To the extent the Company sublicenses its license rights under the Penn Agreement, Penn would be eligible to receive tiered sublicense income at percentage rates in the mid-single to low double-digits. There were no amounts due under the Penn Agreement as of March 31, 2020. Sponsored Research Agreements The Company has sponsored research agreements with two faculty members at Penn, who are also scientific co-founders of the Company and members of the Company’s scientific advisory board. Under the agreements, the Company has committed to funding a defined research plan for three years through April 2021. The total estimated three-year cost of $8,524 under the two agreements satisfies the Company’s annual obligation under the Penn Agreement (see License Agreement with the Trustees of the University of Pennsylvania Master Translational Research Services Agreement In October 2018, the Company entered into a services agreement (the Services Agreement) with Penn for additional research and development services from various laboratories within Penn. The research and development activities are detailed in separately executed Penn organization-specific addenda. Research and development expense related to executed addenda under the master translational research service agreement with Penn recognized in the accompanying statements of operations for the three months ended March 31, 2020 and 2019 was $711 and $1,067, respectively. The Company may incur expenses up to $450 through the remaining term of the Addendum in 2020 related to the manufacture of vector under the Center for Advanced Retinal and Ocular Therapeutics, or CAROT, Addendum. Subscription and Technology Transfer Agreement In July 2019, the Company entered into a subscription and technology transfer agreement pursuant to which the Company owed Penn an upfront subscription fee, which was paid in the third quarter of 2019, and a nominal non-refundable royalty on the net sales of products, a portion of which will be credited toward milestone payments and royalties, respectively, under the Amended License Agreement. Technology transfer activities will be at the Company’s cost and subject to agreement as to the technology to be transferred. No expense was recognized under this agreement during the three months ended March 31, 2020 and March 31, 2019, respectively. Manufacturing Agreements Under agreements with manufacturers and other related vendors, the Company is progressing a staged plan for vector development and may incur up to $2,000 in committed spend over the next nine months. Other Purchase Commitments In the normal course of business, the Company enters into various purchase commitments with third-party contract manufacturers for the manufacture and processing of its product candidates and related raw materials, contracts with contract research organizations for clinical trials and agreements with vendors for other services and products for operating purposes. These agreements generally provide for termination or cancellation, other than for costs already incurred. Indemnification The Company enters into certain types of contracts that contingently require the Company to indemnify various parties against claims from third parties. These contracts primarily relate to (i) the Company’s Amended and Restated Bylaws (bylaws) under which the Company must indemnify directors and executive officers, and may indemnify other officers and employees, for liabilities arising out of their relationship, (ii) contracts under which the Company must indemnify directors and certain officers and consultants for liabilities arising out of their relationship, (iii) contracts under which the Company may be required to indemnify partners against certain claims, including claims from third parties asserting, among other things, infringement of their intellectual property rights, and (iv) procurement, consulting, or license agreements under which the Company may be required to indemnify vendors, consultants or licensors for certain claims, including claims that may be brought against them arising from the Company’s acts or omissions with respect to the supplied products, technology or services. From time to time, the Company may receive indemnification claims under these contracts in the normal course of business. In addition, under these contracts, the Company may have to modify the accused infringing intellectual property and/or refund amounts received. In the event that one or more of these matters were to result in a claim against the Company, an adverse outcome, including a judgment or settlement, may have a material adverse effect on the Company’s future business, operating results or financial condition. It is not possible to determine the maximum potential amount under these contracts due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. |
Preferred Stock
Preferred Stock | 3 Months Ended |
Mar. 31, 2020 | |
Temporary Equity Disclosure [Abstract] | |
Preferred Stock | 6. Preferred Stock Preferred Stock The Company has 10,000,000 shares of authorized preferred stock as of March 31, 2020, none of which is issued or outstanding. The preferred stock is not redeemable and does not have a stated voting, dividend or liquidation preference. Convertible Preferred Stock The Company has issued Series A Preferred, Series A-1 Preferred, Series A-2 Preferred, and Series B Preferred of Convertible Preferred Stock. The Company classified Convertible Preferred Stock outside of stockholders’ equity (deficit) because the shares contained deemed liquidation rights that were a contingent redemption feature not solely within the control of the Company. The following table summarizes the Company’s Convertible Preferred Stock issued and outstanding as of March 31, 2019: Series A Preferred Series A-1 Preferred Series A-2 Preferred Series B Preferred Total Convertible Preferred Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance—December 31, 2018 3,146,551 $ 12,575 7,372,719 $ 24,994 1,873,777 $ 6,352 — $ — 12,393,047 $ 43,921 Issuance — — — — — — 6,963,788 50,000 6,963,788 50,000 Exchange, including deemed dividend — — — — (1,405,332 ) (4,764 ) 1,405,332 10,090 — 5,326 Issuance costs — — — — — — — (1,293 ) — (1,293 ) Balance—March 31, 2019 3,146,551 $ 12,575 7,372,719 $ 24,994 468,445 $ 1,588 8,369,120 $ 58,797 19,356,835 $ 97,954 In January 2019, the Company’s certificate of incorporation was amended to increase the authorized shares of Convertible Preferred Stock to 20,762,168 shares, and the Company issued 6,963,788 shares of Series B Preferred, resulting in gross proceeds of $50,000. In connection, the Company issued a further 1,405,332 shares of Series B Preferred in exchange for 1,405,332 shares of Series A-2 Preferred. The Company determined the terms of the Series B Preferred to be materially, qualitatively different than the terms of the Series A-2 Preferred and, as such, applied extinguishment accounting with respect to the Series A-2 Preferred received in the exchange resulting in removal of the carrying amount of the Series A-2 Preferred received ($4,764), the addition of the Series B Preferred issued at fair value determined with reference to the contemporaneous issuance of Series B Preferred ($10,090) and the difference ($5,326) determined to be a deemed dividend recorded to additional paid-in capital (to the extent of paid-in capital) and accumulated deficit within stockholders’ deficit on the balance sheet. The shares of Convertible Preferred Stock had various rights, including voting and dividend rights, preferences and privileges, including optional and mandatory conversion rights. In October 2019, the Convertible Preferred Stock was converted into 12,904,534 shares of Common Stock. Certain holders of the Company’s Convertible Preferred Stock elected to have such shares convert into 6,409,519 shares of non-voting Common Stock following the closing of the Company’s IPO. The non-voting shares of Common Stock have the same rights and preferences as the Common Stock but are non-voting. No |
Common Stock
Common Stock | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Common Stock | 7. Common Stock Common Stock Pursuant to the Amended and Restated Certificate of Incorporation filed in August 2018, the Company was authorized to issue a total of 21,147,115 shares of common stock. In January 2019, the Company’s certificate of incorporation was further amended to authorize the issuance of 29,000,000 shares of common stock. In October 2019, the Company’s certificate of incorporation was further amended to authorize the issuance of 143,590,481 shares of voting common stock and 6,409,519 shares of non-voting common stock. Holders of voting common stock shall have the exclusive right to vote for the election of directors of the Company and on all other matters requiring stockholder action. In May 2018, several of the Company’s founders agreed to modify their shares of common stock outstanding to include vesting provisions that require continued service to the Company in order to vest in those shares. As such, the 2,904,000 modified shares of common stock became compensatory upon such modification. The fair value of the awards on the modification date was determined to be $0.74 per share of common stock, based on the issuance of convertible notes in May 2018, considering the maximum conversion price and the seniority of the notes. The total compensation cost resulting from the modification was $2,126. The total compensation cost is being recognized over the three-year vesting term attendant to the founders’ common shares. During the three months ended March 31, 2020, the Company recognized $124 and $44 of this amount in research and development expense and general and administrative expense, respectively. During the three months ended March 31, 2019, the Company recognized $132 and $44 of this amount in research and development expense and general and administrative expense, respectively. 2018 Stock Option and Grant Plan In September 2018, the Company adopted the 2018 Stock Option and Grant Plan (2018 Plan), which provided for the Company to sell or issue common stock, or other stock-based awards, to employees, members of the board of directors and consultants of the Company. The 2018 Plan was administered by the board of directors, or at the discretion of the board of directors, by a committee of the board of directors. The exercise prices, vesting and other restrictions were determined at the discretion of the board of directors, or their committee if so delegated, except that the exercise price per share of stock options may not be less than 100% of the fair market value of the share of common stock on the date of grant and the term of stock option may not be greater than 10 years. The Company generally granted stock-based awards with service conditions only (service-based awards), although there has been one grant with performance conditions. Stock options granted under the 2018 Plan generally vest over three to four years. There were 1,959,411 options granted under the 2018 Plan prior to the plan termination upon consummation of the Company’s IPO in October 2019. 2019 Stock Option and Incentive Plan The 2019 Stock Option and Incentive Plan (2019 Plan) was approved by the Company’s board of directors on October 14, 2019, and became effective on October 23, 2019. The 2019 Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock units, restricted stock awards, unrestricted stock awards, cash-based awards and dividend equivalent rights to the Company’s officers, employees, directors and consultants. The number of shares initially reserved for issuance under the 2019 Plan was 2,342,288, which was increased by 961,361 shares on January 1, 2020 and shall be cumulatively increased each January 1 thereafter by 4% of the number of shares of the Company’s common stock outstanding on the immediately preceding December 31 or such lesser number of shares determined by the Company’s board of directors or compensation committee of the board of directors. As of March 31, 2020, there were 2,582,689 shares remaining available for issuance. A summary of stock option activity is presented below: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding as of January 1, 2020 2,129,632 $ 5.12 9.2 $ 18,844 Granted 528,072 15.07 Forfeited/Cancelled — — Outstanding as of March 31, 2020 2,657,704 7.10 9.2 6,326 Options Exercisable at March 31, 2020 482,234 2.20 8.7 2,488 The aggregate intrinsic value of options granted is calculated as the difference between the exercise price of the options and the estimated fair value of the Company’s common stock. The weighted average grant-date fair value of stock options granted during the three months ended March 31, 2020 and 2019 was $9.44 and $3.85, respectively. The aggregate grant-date fair value of options vested during the three months ended March 31, 2020 and 2019 was $388 and $83, respectively. The fair value of each award is estimated using Black-Scholes based on the following assumptions: Three Months Ended March 31, 2020 2019 Risk-free interest rate 0.93%—1.48% 2.23%—2.59% Expected term 5.7—6.1 years 5.6—6.1 years Expected volatility 70%—73% 70%—73% Expected dividend yield 0% 0% Black-Scholes requires the use of subjective assumptions which determine the fair value of stock-based awards. These assumptions include: Fair value of common stock —Historically, because there was no public market for the Company’s common stock until its IPO in October 2019, the fair value of the Company’s common stock underlying stock-based awards was estimated on each grant date by the Company’s board of directors. In order to determine the fair value of the Company’s common stock underlying stock-based awards, the Company’s board of directors considered, among other things, a valuation of the Company’s common stock prepared by an unrelated third-party valuation firm in accordance with the guidance provided by the American Institute of Certified Public Accountants Practice Guide, . Expected term —The expected term represents the period that stock-based awards are expected to be outstanding. The expected term for option grants is determined using the simplified method. The simplified method deems the term to be the average of the time-to-vesting and the contractual life of the stock-based awards. Expected volatility —The Company has limited trading history for its common stock, with its IPO in October 2019, and, as such, the expected volatility is estimated based on the volatility for comparable publicly traded biotechnology companies over a period equal to the expected term of the stock-based awards. The comparable companies were chosen based on their similar size, stage in the life cycle or area of specialty. 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. Risk-free interest rate —The risk-free interest rate is based on the U.S. Treasury zero coupon issues in effect at the time of grant for periods corresponding with the expected term of a stock-based award. Expected dividend —The Company has never paid dividends on its common stock and has no plans to pay dividends on its common stock. Therefore, the Company used an expected dividend yield of zero. Stock-based Compensation The Company recognizes stock-based compensation with respect to equity awards under the 2018 Plan and with respect to vesting common stock issued to founders. The Company has recorded stock-based compensation in the accompanying statements of operations as follows: Three Months Ended March 31, 2020 2019 Research and development $ 419 $ 360 General and administrative 454 136 Total $ 873 $ 496 As of March 31, 2020, there was $11,076 of unrecognized compensation cost related to unvested option awards, including $176 with respect to one grant with performance-based vesting terms, which is expected to be recognized over a weighted-average period of 3.1 years. As of March 31, 2020, there was $744 of unrecognized compensation cost related to unvested stock awards granted to several Company founders, which is expected to be recognized over a weighted-average period of 1.1 years. 2019 Employee Stock Purchase Plan The 2019 Employee Stock Purchase Plan (2019 ESPP) was approved by the Company’s board of directors on October 14, 2019, and became effective on October 23, 2019. A total of 234,229 shares of common stock were initially reserved for issuance under the 2019 ESPP, which was cumulatively increased on January 1, 2020 by 234,229 shares and each January 1 thereafter through January 1, 2029 by the least of (i) 234,229 shares of common stock, (ii) 1% of the number of shares of the Company’s common stock outstanding on the immediately preceding December 31 or (iii) such lesser number of shares determined by the 2019 ESPP’s administrator. The 2019 ESPP allows eligible employees to purchase shares during certain offering periods. No shares have been purchased under the 2019 ESPP as of March 31, 2020. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 8. Income Taxes The Company did not record an income tax benefit in its statements of operations for the three months ended March 31, 2020 and 2019 as it is more likely than not that the Company will not recognize the federal and state deferred tax benefits generated by its losses. The Company has provided a valuation allowance for the full amount of its net deferred tax assets and liabilities as of March 31, 2020 and December 31, 2019, as management has determined it is more likely than not that any future benefit from deductible temporary differences and net operating loss and tax credit carryforwards would not be realized. The Company has not recorded any amounts for unrecognized tax benefits as of March 31, 2020 and December 31, 2019. |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 9. Net Loss Per Share The Company calculates basic and diluted net loss per share attributable to common stockholders in conformity with the two-class method required for participating securities. For the three months ended March 31, 2020, the Company had voting and non-voting common stock outstanding. Since the rights of the voting and non-voting common stock are identical, except with respect to voting, the undistributed losses of the Company have been allocated on a proportionate basis to the two classes. Diluted net loss per share is calculated using the if-converted method, which assumes conversion of all non-voting common stock to voting common stock. Voting common stock Non-voting common stock Basic net loss per share: Numerator Allocation of undistributed losses attributable to common stockholders $ (5,380 ) $ (2,105 ) Denominator Weighted average number of shares used in basic per share computation 16,379,788 6,409,519 Net loss per share, basic $ (0.33 ) $ (0.33 ) Diluted net loss per share: Numerator Allocation of undistributed losses for basic computation $ (5,380 ) $ (2,105 ) Reallocation of undistributed losses as a result of conversion of non-voting to voting common shares (2,105 ) — Allocation of undistributed losses $ (7,485 ) $ (2,105 ) Denominator Weighted average number of shares used in basic per share computation 16,379,788 6,409,519 Add: conversion of non-voting to voting common shares outstanding 6,409,519 — Weighted average number of shares used in diluted per share computation 22,789,307 6,409,519 Net loss per share, diluted $ (0.33 ) $ (0.33 ) For the three months ended March 31, 2019, basic and diluted net loss per share is: Common stock Basic and diluted net loss per share: Numerator Net loss attributable to common stockholders $ (8,858 ) Denominator Weighted average number of shares used in basic and diluted per share computation 1,464,572 Net loss per share, diluted $ (6.05 ) The following outstanding potentially dilutive shares have been excluded from the calculation of diluted net loss per share, as their effect is anti-dilutive: As of March 31, 2020 2019 Convertible preferred stock — 19,356,835 Stock options to purchase common stock 2,657,704 1,304,285 Non-vested common stock 1,158,185 2,382,651 3,815,889 23,043,771 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Unaudited Interim Financial Information | Unaudited Interim Financial Information The accompanying unaudited interim financial statements have been prepared in conformity with generally accepted accounting principles (GAAP) and the applicable rules and regulations of the Securities and Exchange Commission (SEC) regarding interim financial reporting. Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification and Accounting Standards Updates (ASU) of the Financial Accounting Standards Board (FASB). As permitted under these rules, certain footnotes and other financial information that are normally required by GAAP have been condensed or omitted. In the opinion of management, the accompanying unaudited interim financial statements include all normal and recurring adjustments (which consist primarily of accruals and estimates that impact the financial statements) considered necessary to present fairly the Company’s financial position as of March 31, 2020 and the results of its operations and its cash flows for the three months ended March 31, 2020 and 2019. The results for the three months ended March 31, 2020 are not necessarily indicative of results to be expected for the year ending December 31, 2020, any other interim periods, or any future year or period. The balance sheet as of December 31, 2019 included herein was derived from the audited financial statements as of that date. The unaudited interim financial statements, presented herein, do not contain the required disclosures under GAAP for annual financial statements. These unaudited financial statements should be read in conjunction with the Company’s audited financial statements, which are included in the Company’s 2019 Annual Report on Form 10-K, filed with the SEC on March 30, 2020 (2019 Annual Report). |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of expenses during the reporting period. Significant estimates and assumptions made in the accompanying financial statements include, but are not limited to, the fair value of common stock, stock-based compensation and the valuation allowance on the Company’s deferred tax assets. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could differ from those estimates. |
Off-Balance Sheet Risk and Concentrations of Credit Risk | Off-Balance Sheet Risk and Concentrations of Credit Risk Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist primarily of cash and cash equivalents, which are primarily invested in U.S. treasury-based money market funds. A portion of the Company’s cash is maintained at a federally insured financial institution. The deposits held at this institution are in excess of federally insured limits. The Company has not experienced any losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institution in which those deposits are held. The cash in this account is swept daily into U.S. treasury-based and U.S. government-based money market funds. The Company has no off‑balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. |
Fair Value Measurement | Fair Value Measurement Assets and liabilities recorded at fair value on a recurring basis in the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair values. Fair value is defined as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The authoritative guidance on fair value measurements establishes a three-tier fair value hierarchy for disclosure of fair value measurements as follows: Level 1—Observable inputs such as unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2—Inputs (other than quoted prices included in Level 1) that are either directly or indirectly observable for the asset or liability. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. 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. |
Related Party Transactions | Related Party Transactions The Company engaged a firm controlled by a former executive (until February 2019) of the Company for professional services related to accounting, finance and other administrative functions. For the three months ended March 31, 2020 and 2019, the costs incurred under this arrangement totaled $151 and $187, respectively. As of March 31, 2020 and December 31, 2019, amounts owed under this arrangement totaled $95 and $36, respectively, and are included in accounts payable in the accompanying balance sheets. |
Emerging Growth Company Status | Emerging Growth Company Status The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Financial Assets Measured at Fair Value on Recurring Basis | The following tables present financial information about the Company’s financial assets measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values: March 31, 2020 Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets Cash equivalents: Money market funds $ 131,003 $ 131,003 $ — $ — Total $ 131,003 $ 131,003 $ — $ — December 31, 2019 Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets Cash equivalents: Money market funds $ 136,204 $ 136,204 $ — $ — Total $ 136,204 $ 136,204 $ — $ — |
Accrued and Other Current Lia_2
Accrued and Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Payables And Accruals [Abstract] | |
Schedule of Accrued and Other Current Liabilities | Accrued and other current liabilities consist of the following: March 31, 2020 December 31, 2019 Research and development services $ 469 $ 231 General and administrative services 132 297 Compensation expense 563 1,522 Other 101 177 $ 1,265 $ 2,227 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Payments for Operating Leases | As of March 31, 2020, the future minimum payments for operating leases are as follows: April 1, 2020 to December 31, 2020 $ 198 2021 268 2022 158 Thereafter — $ 624 |
Preferred Stock (Tables)
Preferred Stock (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Partners Capital [Abstract] | |
Summary of Convertible Preferred Stock | The following table summarizes the Company’s Convertible Preferred Stock issued and outstanding as of March 31, 2019: Series A Preferred Series A-1 Preferred Series A-2 Preferred Series B Preferred Total Convertible Preferred Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance—December 31, 2018 3,146,551 $ 12,575 7,372,719 $ 24,994 1,873,777 $ 6,352 — $ — 12,393,047 $ 43,921 Issuance — — — — — — 6,963,788 50,000 6,963,788 50,000 Exchange, including deemed dividend — — — — (1,405,332 ) (4,764 ) 1,405,332 10,090 — 5,326 Issuance costs — — — — — — — (1,293 ) — (1,293 ) Balance—March 31, 2019 3,146,551 $ 12,575 7,372,719 $ 24,994 468,445 $ 1,588 8,369,120 $ 58,797 19,356,835 $ 97,954 |
Common Stock (Tables)
Common Stock (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Summary of Stock Option Activity | A summary of stock option activity is presented below: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding as of January 1, 2020 2,129,632 $ 5.12 9.2 $ 18,844 Granted 528,072 15.07 Forfeited/Cancelled — — Outstanding as of March 31, 2020 2,657,704 7.10 9.2 6,326 Options Exercisable at March 31, 2020 482,234 2.20 8.7 2,488 |
Schedule of Assumptions Used to Estimate Fair Value of Stock Options | The fair value of each award is estimated using Black-Scholes based on the following assumptions: Three Months Ended March 31, 2020 2019 Risk-free interest rate 0.93%—1.48% 2.23%—2.59% Expected term 5.7—6.1 years 5.6—6.1 years Expected volatility 70%—73% 70%—73% Expected dividend yield 0% 0% |
Summary of Stock-Based Compensation | The Company recognizes stock-based compensation with respect to equity awards under the 2018 Plan and with respect to vesting common stock issued to founders. The Company has recorded stock-based compensation in the accompanying statements of operations as follows: Three Months Ended March 31, 2020 2019 Research and development $ 419 $ 360 General and administrative 454 136 Total $ 873 $ 496 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share | Voting common stock Non-voting common stock Basic net loss per share: Numerator Allocation of undistributed losses attributable to common stockholders $ (5,380 ) $ (2,105 ) Denominator Weighted average number of shares used in basic per share computation 16,379,788 6,409,519 Net loss per share, basic $ (0.33 ) $ (0.33 ) Diluted net loss per share: Numerator Allocation of undistributed losses for basic computation $ (5,380 ) $ (2,105 ) Reallocation of undistributed losses as a result of conversion of non-voting to voting common shares (2,105 ) — Allocation of undistributed losses $ (7,485 ) $ (2,105 ) Denominator Weighted average number of shares used in basic per share computation 16,379,788 6,409,519 Add: conversion of non-voting to voting common shares outstanding 6,409,519 — Weighted average number of shares used in diluted per share computation 22,789,307 6,409,519 Net loss per share, diluted $ (0.33 ) $ (0.33 ) For the three months ended March 31, 2019, basic and diluted net loss per share is: Common stock Basic and diluted net loss per share: Numerator Net loss attributable to common stockholders $ (8,858 ) Denominator Weighted average number of shares used in basic and diluted per share computation 1,464,572 Net loss per share, diluted $ (6.05 ) |
Schedule of Antidilutive Shares Excluded from Calculation of Diluted Net Loss Per Share | The following outstanding potentially dilutive shares have been excluded from the calculation of diluted net loss per share, as their effect is anti-dilutive: As of March 31, 2020 2019 Convertible preferred stock — 19,356,835 Stock options to purchase common stock 2,657,704 1,304,285 Non-vested common stock 1,158,185 2,382,651 3,815,889 23,043,771 |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Details) $ / shares in Units, $ in Thousands | Oct. 29, 2019USD ($)$ / sharesshares | Oct. 16, 2019$ / shares | Nov. 30, 2019USD ($)shares | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
Basis Of Presentation [Line Items] | |||||
Reverse stock split description | 1-for-1.5 reverse split | ||||
Reverse stock split ratio | 0.67 | ||||
Common stock, par value | $ / shares | $ 0.00001 | ||||
Cash and cash equivalents | $ | $ 131,003 | $ 136,204 | |||
Accumulated deficit | $ | $ (40,444) | $ (32,959) | |||
Initial Public Offering | |||||
Basis Of Presentation [Line Items] | |||||
Issuance of common stock, shares | shares | 6,800,000 | ||||
Common stock issued, per share | $ / shares | $ 11 | ||||
Net proceeds from initial public offering | $ | $ 66,156 | $ 4,864 | |||
Conversion of convertible preferred stock to common stock | shares | 12,904,534 | ||||
Number of additional common stock purchased by underwriters upon partial exercise of option | shares | 475,501 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Summary of Significant Accounting Policies [Line Items] | |||
Amounts due to related party | $ 95 | $ 36 | |
Professional Services | |||
Summary of Significant Accounting Policies [Line Items] | |||
Costs incurred under the arrangements | $ 151 | $ 187 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets Measured at Fair Value on Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Cash equivalents: | ||
Total | $ 131,003 | $ 136,204 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Cash equivalents: | ||
Total | 131,003 | 136,204 |
Money Market Funds | ||
Cash equivalents: | ||
Total | 131,003 | 136,204 |
Money Market Funds | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Cash equivalents: | ||
Total | $ 131,003 | $ 136,204 |
Accrued and Other Current Lia_3
Accrued and Other Current Liabilities - Schedule of Accrued and Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Payables And Accruals [Abstract] | ||
Research and development services | $ 469 | $ 231 |
General and administrative services | 132 | 297 |
Compensation expense | 563 | 1,522 |
Other | 101 | 177 |
Accrued and other current liabilities | $ 1,265 | $ 2,227 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2020USD ($)Faculty | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($)shares | Dec. 31, 2019USD ($) | |
Commitments and Contingencies [Line Items] | ||||
Research and development expense | $ 4,620,000 | $ 2,761,000 | ||
Manufacturing agreements, maximum amount committed | $ 2,000,000 | |||
Operating Lease Agreement | ||||
Commitments and Contingencies [Line Items] | ||||
Operating lease, description | The lease term commenced in May 2019 and will expire in July 2022. | |||
Lease commencement period | 2019-05 | |||
Lease expiration period | 2022-07 | |||
Initial annual base rent | $ 261,000 | |||
Percentage of annual increase of base rent | 2.00% | |||
Rent expense | $ 67,000 | |||
Research Service Agreement | Children's Hospital of Philadelphia | ||||
Commitments and Contingencies [Line Items] | ||||
Research and development expense | 0 | 179,000 | ||
Amounts due to agreement | 0 | |||
Penn Agreement | ||||
Commitments and Contingencies [Line Items] | ||||
Amounts due to agreement | 0 | |||
Obligation to be paid | $ 2,000,000 | |||
Payment term | 3 years | |||
Payment commencement date | 2018-08 | |||
License maintenance fee | $ 10,000 | |||
Out-of-pocket expenses reimbursed | $ 89,000 | |||
Other amounts paid to agreement | $ 0 | |||
Total milestone payments | 20,000,000 | |||
Penn Agreement | Common Stock | ||||
Commitments and Contingencies [Line Items] | ||||
Number of shares issued, shares | shares | 481,318,000 | |||
Number of shares issued, value | $ 1,155,000 | |||
Sponsored Research Agreements | Penn | ||||
Commitments and Contingencies [Line Items] | ||||
Research and development expense | 603,000 | 710,000 | ||
Obligation to be paid | $ 8,524,000 | |||
Number of faculty member | Faculty | 2 | |||
Funding term | 3 years | |||
Funding term end date | 2021-04 | |||
Sponsored Research Agreements | Penn | Prepaid Expenses and Other Current Assets | ||||
Commitments and Contingencies [Line Items] | ||||
Advance payments | $ 985,000 | $ 1,588,000 | ||
Master Translational Research Services Agreement | ||||
Commitments and Contingencies [Line Items] | ||||
Research and development expense | 711,000 | 1,067,000 | ||
Maximum research and development expense incurred | 450,000 | |||
Subscription and Technology Transfer Agreement | ||||
Commitments and Contingencies [Line Items] | ||||
Expense related to agreement | $ 0 | $ 0 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Future Minimum Payments for Operating Leases (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
April 1, 2020 to December 31, 2020 | $ 198 |
2021 | 268 |
2022 | 158 |
Total | $ 624 |
Preferred Stock - Additional In
Preferred Stock - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||||
Oct. 31, 2019 | Jan. 31, 2019 | Mar. 31, 2019 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Temporary Equity [Line Items] | ||||||
Preferred stock, authorized shares | 10,000,000 | 10,000,000 | ||||
Preferred stock, issued shares | 0 | 0 | ||||
Preferred stock, outstanding shares | 0 | 0 | ||||
Convertible preferred stock, authorized shares | 20,762,168 | |||||
Gross proceeds from convertible preferred stock | $ 50,000 | |||||
Preferred stock exchange including deemed dividend | $ (5,326) | |||||
Convertible preferred stock convert into common stock | 12,904,534 | |||||
Convertible preferred stock convert into non-voting common stock | 6,409,519 | |||||
Series B Preferred Stock | ||||||
Temporary Equity [Line Items] | ||||||
Issuance, shares | 6,963,788 | 6,963,788 | ||||
Gross proceeds from convertible preferred stock | $ 50,000 | |||||
Number of preferred shares in exchange | 1,405,332 | 1,405,332 | ||||
Preferred stock exchange including deemed dividend | $ (10,090) | $ (10,090) | ||||
Convertible preferred stock, outstanding shares | 8,369,120 | |||||
Series A-2 Preferred | ||||||
Temporary Equity [Line Items] | ||||||
Number of preferred shares in exchange | (1,405,332) | (1,405,332) | ||||
Preferred stock exchange including deemed dividend | $ (4,764) | $ 4,764 | ||||
Convertible preferred stock, outstanding shares | 468,445 | 1,873,777 | ||||
Convertible Preferred Stock | ||||||
Temporary Equity [Line Items] | ||||||
Issuance, shares | 6,963,788 | |||||
Preferred stock exchange including deemed dividend | $ (5,326) | |||||
Convertible preferred stock, outstanding shares | 19,356,835 | 0 | 0 | 12,393,047 |
Preferred Stock - Summary of Co
Preferred Stock - Summary of Convertible Preferred Stock (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended |
Jan. 31, 2019 | Mar. 31, 2019 | |
Temporary Equity [Line Items] | ||
Exchange, including deemed dividend | $ 5,326 | |
Series A Preferred | ||
Temporary Equity [Line Items] | ||
Beginning balance | $ 12,575 | $ 12,575 |
Beginning balance, Shares | 3,146,551 | 3,146,551 |
Ending balance | $ 12,575 | |
Ending balance, Shares | 3,146,551 | |
Series A-1 Preferred | ||
Temporary Equity [Line Items] | ||
Beginning balance | $ 24,994 | $ 24,994 |
Beginning balance, Shares | 7,372,719 | 7,372,719 |
Ending balance | $ 24,994 | |
Ending balance, Shares | 7,372,719 | |
Series A-2 Preferred | ||
Temporary Equity [Line Items] | ||
Beginning balance | $ 6,352 | $ 6,352 |
Beginning balance, Shares | 1,873,777 | 1,873,777 |
Exchange, including deemed dividend | $ 4,764 | $ (4,764) |
Exchange, including deemed dividend, Shares | (1,405,332) | (1,405,332) |
Ending balance | $ 1,588 | |
Ending balance, Shares | 468,445 | |
Series B Preferred Stock | ||
Temporary Equity [Line Items] | ||
Issuance | $ 50,000 | |
Issuance, shares | 6,963,788 | 6,963,788 |
Exchange, including deemed dividend | $ 10,090 | $ 10,090 |
Exchange, including deemed dividend, Shares | 1,405,332 | 1,405,332 |
Issuance costs | $ (1,293) | |
Ending balance | $ 58,797 | |
Ending balance, Shares | 8,369,120 | |
Convertible Preferred Stock | ||
Temporary Equity [Line Items] | ||
Beginning balance | $ 43,921 | $ 43,921 |
Beginning balance, Shares | 12,393,047 | 12,393,047 |
Issuance | $ 50,000 | |
Issuance, shares | 6,963,788 | |
Exchange, including deemed dividend | $ 5,326 | |
Issuance costs | (1,293) | |
Ending balance | $ 97,954 | |
Ending balance, Shares | 19,356,835 |
Common Stock - Additional Infor
Common Stock - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | Oct. 23, 2019 | May 31, 2018 | Mar. 31, 2020 | Mar. 31, 2019 | Jan. 01, 2020 | Dec. 31, 2019 | Oct. 30, 2019 | Jan. 31, 2019 | Dec. 31, 2018 |
Class Of Stock [Line Items] | |||||||||
Common stock, authorized shares | 150,000,000 | 150,000,000 | 29,000,000 | 21,147,115 | |||||
Common stock shares modified | 2,904,000 | ||||||||
Fair value of common stock shares modified | $ 0.74 | ||||||||
Total compensation cost of common stock shares modified | $ 2,126 | ||||||||
Unrecognized compensation cost, period for recognition | 3 years | 3 years 1 month 6 days | |||||||
Unrecognized compensation cost related to unvested stock-based awards | $ 11,076 | ||||||||
2019 Plan | |||||||||
Class Of Stock [Line Items] | |||||||||
Shares reserved for issuance | 2,342,288 | 961,361 | |||||||
Increase in share reserved percentage | 4.00% | ||||||||
Share-based compensation, number of shares available for grant | 2,582,689 | ||||||||
2019 ESPP | |||||||||
Class Of Stock [Line Items] | |||||||||
Shares reserved for issuance | 234,229 | ||||||||
Minimum | 2019 ESPP | |||||||||
Class Of Stock [Line Items] | |||||||||
Shares reserved for issuance | 234,229 | ||||||||
Increase in share reserved percentage | 1.00% | ||||||||
Stock Options | |||||||||
Class Of Stock [Line Items] | |||||||||
Compensation cost recognized | $ 873 | $ 496 | |||||||
Stock Options | 2018 Plan | |||||||||
Class Of Stock [Line Items] | |||||||||
Number of options granted | 1,959,411 | ||||||||
Stock Options | 2019 Plan | |||||||||
Class Of Stock [Line Items] | |||||||||
Number of options granted | 528,072 | ||||||||
Weighted average grant-date fair value of stock options granted | $ 9.44 | $ 3.85 | |||||||
Aggregate grant-date fair value of options vested | $ 388 | $ 83 | |||||||
Stock Options | Minimum | 2018 Plan | |||||||||
Class Of Stock [Line Items] | |||||||||
Percentage of exercise price per share of fair market value | 100.00% | ||||||||
Share-based compensation, vesting period | 3 years | ||||||||
Stock Options | Maximum | 2018 Plan | |||||||||
Class Of Stock [Line Items] | |||||||||
Term of stock options after grant date | 10 years | ||||||||
Share-based compensation, vesting period | 4 years | ||||||||
Performance-Based Shares | |||||||||
Class Of Stock [Line Items] | |||||||||
Unrecognized compensation cost related to unvested stock-based awards, other than options | $ 176 | ||||||||
Founders | |||||||||
Class Of Stock [Line Items] | |||||||||
Unrecognized compensation cost, period for recognition | 1 year 1 month 6 days | ||||||||
Unrecognized compensation cost related to unvested stock-based awards | $ 744 | ||||||||
Research and Development | Stock Options | |||||||||
Class Of Stock [Line Items] | |||||||||
Compensation cost recognized | 419 | 360 | |||||||
Research and Development | Founders | |||||||||
Class Of Stock [Line Items] | |||||||||
Compensation cost recognized | 124 | 132 | |||||||
General and Administrative Expense | Stock Options | |||||||||
Class Of Stock [Line Items] | |||||||||
Compensation cost recognized | 454 | 136 | |||||||
General and Administrative Expense | Founders | |||||||||
Class Of Stock [Line Items] | |||||||||
Compensation cost recognized | $ 44 | $ 44 | |||||||
Voting Common Stock | |||||||||
Class Of Stock [Line Items] | |||||||||
Common stock, authorized shares | 143,590,481 | 143,590,481 | 143,590,481 | ||||||
Non-voting Common Stock | |||||||||
Class Of Stock [Line Items] | |||||||||
Common stock, authorized shares | 6,409,519 | 6,409,519 | 6,409,519 |
Common Stock - Summary of Stock
Common Stock - Summary of Stock Option Activity (Details) - Stock Options - 2019 Plan - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Number of Shares | ||
Number of Shares, Beginning Balance | 2,129,632 | |
Number of Shares, Granted | 528,072 | |
Number of Shares, Ending Balance | 2,657,704 | 2,129,632 |
Number of Shares, Options Exercisable | 482,234 | |
Weighted Average Exercise Price | ||
Weighted Average Exercise Price, Beginning Balance | $ 5.12 | |
Weighted Average Exercise Price, Granted | 15.07 | |
Weighted Average Exercise Price, Ending Balance | 7.10 | $ 5.12 |
Weighted Average Exercise Price, Options Exercisable | $ 2.20 | |
Weighted Average Remaining Contractual Term (years) | ||
Term (years) | 9 years 2 months 12 days | 9 years 2 months 12 days |
Weighted Average Remaining Contractual Term (years), Options Exercisable | 8 years 8 months 12 days | |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value, Beginning Balance | $ 18,844 | |
Aggregate Intrinsic Value, Ending Balance | 6,326 | $ 18,844 |
Aggregate Intrinsic Value, Options Exercisable | $ 2,488 |
Common Stock - Schedule of Assu
Common Stock - Schedule of Assumptions Used to Estimate Fair Value of Stock Options (Details) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Risk-free interest rate, minimum | 0.93% | 2.23% |
Risk-free interest rate, maximum | 1.48% | 2.59% |
Expected volatility, minimum | 70.00% | 70.00% |
Expected volatility, maximum | 73.00% | 73.00% |
Expected dividend yield | 0.00% | 0.00% |
Minimum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected term | 5 years 8 months 12 days | 5 years 7 months 6 days |
Maximum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected term | 6 years 1 month 6 days | 6 years 1 month 6 days |
Common Stock - Summary of Sto_2
Common Stock - Summary of Stock-Based Compensation (Details) - Stock Options - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Stock-based compensation | $ 873 | $ 496 |
Research and Development | ||
Stock-based compensation | 419 | 360 |
General and Administrative Expense | ||
Stock-based compensation | $ 454 | $ 136 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Income tax benefit | $ 0 | $ 0 | |
Unrecognized tax benefits | $ 0 | $ 0 |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Voting Common Stock | ||
Basic net loss per share: | ||
Allocation of undistributed losses attributable to common stockholders | $ (5,380) | |
Weighted average number of shares used in basic per share computation | 16,379,788 | |
Net loss per share, basic | $ (0.33) | |
Diluted net loss per share: | ||
Allocation of undistributed losses for basic computation | $ (5,380) | |
Reallocation of undistributed losses as a result of conversion of non-voting to voting common shares | (2,105) | |
Allocation of undistributed losses | $ (7,485) | |
Weighted average number of shares used in basic per share computation | 16,379,788 | |
Add: conversion of non-voting to voting common shares outstanding | 6,409,519 | |
Weighted average number of shares used in diluted per share computation | 22,789,307 | |
Net loss per share, diluted | $ (0.33) | |
Basic and diluted net loss per share: | ||
Net loss per share, diluted | $ (0.33) | |
Non-voting Common Stock | ||
Basic net loss per share: | ||
Allocation of undistributed losses attributable to common stockholders | $ (2,105) | |
Weighted average number of shares used in basic per share computation | 6,409,519 | |
Net loss per share, basic | $ (0.33) | |
Diluted net loss per share: | ||
Allocation of undistributed losses for basic computation | $ (2,105) | |
Allocation of undistributed losses | $ (2,105) | |
Weighted average number of shares used in basic per share computation | 6,409,519 | |
Weighted average number of shares used in diluted per share computation | 6,409,519 | |
Net loss per share, diluted | $ (0.33) | |
Basic and diluted net loss per share: | ||
Net loss per share, diluted | $ (0.33) | |
Common Stock | ||
Diluted net loss per share: | ||
Net loss per share, diluted | $ (6.05) | |
Basic and diluted net loss per share: | ||
Net loss attributable to common stockholders | $ (8,858) | |
Weighted average number of shares used in basic and diluted per share computation | 1,464,572 | |
Net loss per share, diluted | $ (6.05) |
Net Loss Per Share - Schedule_2
Net Loss Per Share - Schedule of Antidilutive Shares Excluded from Calculation of Diluted Net Loss Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive shares have been excluded from calculation of diluted net loss per share | 3,815,889 | 23,043,771 |
Convertible Preferred Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive shares have been excluded from calculation of diluted net loss per share | 19,356,835 | |
Stock Options to Purchase Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive shares have been excluded from calculation of diluted net loss per share | 2,657,704 | 1,304,285 |
Non-vested Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive shares have been excluded from calculation of diluted net loss per share | 1,158,185 | 2,382,651 |