Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | May 12, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2023 | |
Entity File Number | 001-39362 | |
Entity Registrant Name | Gelesis Holdings, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 84-4730610 | |
Entity Address, Address Line One | 501 Boylston Street | |
Entity Address, Address Line Two | Suite 6102 | |
Entity Address, City or Town | Boston | |
Entity Address State Or Province | MA | |
Entity Address, Postal Zip Code | 02116 | |
City Area Code | 617 | |
Local Phone Number | 456-4718 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001805087 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 73,335,110 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 3,103 | $ 7,412 |
Accounts receivable | 1,271 | 1,233 |
Grants receivable | 8,458 | 3,359 |
Inventories | 5,941 | 6,865 |
Prepaid expenses and other current assets | 6,651 | 4,627 |
Total current assets | 25,424 | 23,496 |
Property and equipment, net | 58,354 | 59,335 |
Operating lease right-of-use assets | 1,379 | 1,520 |
Intangible assets, net | 12,846 | 13,413 |
Other assets | 777 | 5,560 |
Total assets | 98,780 | 103,324 |
Current liabilities: | ||
Accounts payable, including due to related party of $421 and $135, respectively | 7,905 | 4,131 |
Accrued expenses and other current liabilities, including due to related party of $2,789 and $2,809, respectively | 7,480 | 10,468 |
Deferred income | 26,806 | 27,793 |
Operating lease liabilities | 587 | 597 |
Convertible promissory notes held at fair value, including due to related party of $21,573 and $22,082, respectively | 25,985 | 27,403 |
Notes payable, including due to related party of $1958 and $2,007, respectively | 7,422 | 7,954 |
Total current liabilities | 76,185 | 78,346 |
Deferred income | 9,234 | 9,544 |
Operating lease liabilities | 835 | 967 |
Notes payable, including due to related party of $13,963 and $13,659, respectively | 26,037 | 25,342 |
Warrant liabilities | 0 | 130 |
Earnout liability | 0 | 563 |
Other long-term liabilities, including due to related party of $141 and $674, respectively | 282 | 898 |
Total liabilities | 112,573 | 115,790 |
Commitments and contingencies (Note 18) | ||
Noncontrolling interest | 12,896 | 12,590 |
Stockholders' deficit: | ||
Preferred stock, $0.0001 par value - 250,000,000 shares authorized at March 31, 2023 and December 31, 2022; zero shares issued and outstanding at March 31, 2023 and December 31, 2022 | ||
Common stock, $0.0001 par value - 900,000,000 shares authorized at March 31,2023 and December 31, 2022; 73,332,588 and 73,325,022 shares issued and outstanding at March 31, 2023 and December 31, 2022 , respectively | 7 | 7 |
Additional paid-in capital | 300,856 | 297,468 |
Accumulated other comprehensive income | 329 | 104 |
Accumulated deficit | (327,881) | (322,635) |
Total stockholders' deficit | (26,689) | (25,056) |
Total liabilities, noncontrolling interest, redeemable convertible preferred stock and stockholders' deficit | $ 98,780 | $ 103,324 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Accounts payable, due to related party | $ 421 | $ 135 |
Accrued expenses and other liabilities, due to related parties | 2,789 | 2,809 |
Convertible promissory note due to related party | 21,573 | 22,082 |
Notes payable, due to related party current | 1,958 | 2,007 |
Notes payable, due to related party noncurrent | 13,963 | 13,659 |
Other long-term liabilities noncurrent, due to related party | $ 141 | $ 674 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 900,000,000 | 900,000,000 |
Common stock, shares issued | 73,332,588 | 73,325,022 |
Common stock, shares outstanding | 73,332,588 | 73,325,022 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 250,000,000 | 250,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenue: | ||
Total revenue, net | $ 1,753 | $ 7,514 |
Operating expenses: | ||
Costs of goods sold, including related party expenses of $71 and $301, respectively | 1,237 | 4,913 |
Selling, general and administrative, including related party expenses of $128 and $126, respectively | 8,287 | 37,706 |
Research and development, including related party expenses of $59 and $62, respectively | 3,637 | 7,410 |
Amortization of intangible assets | 567 | 567 |
Total operating expenses | 13,728 | 50,596 |
Loss from operations | (11,975) | (43,082) |
Change in the fair value of earnout liability | 563 | 33,869 |
Change in the fair value of convertible promissory notes | 4,959 | (156) |
Change in the fair value of warrants | 130 | 3,484 |
Interest expense, net | (891) | (135) |
Other income, net | 2,084 | 317 |
Loss before income taxes | (5,130) | (5,703) |
Provision for income taxes | 16 | 0 |
Net loss | (5,146) | (5,703) |
Accretion of Legacy Gelesis senior preferred stock to redemption value | (37,934) | |
Accretion of noncontrolling interest put option to redemption value | (88) | |
Income allocated to noncontrolling interest holder | (100) | |
Net loss attributable to common stockholders | $ (5,246) | $ (43,725) |
Net loss per share attributable to common stockholders - basic | $ (0.07) | $ (0.70) |
Net loss per share attributable to common stockholders - diluted | $ (0.07) | $ (0.70) |
Weighted average common shares outstanding - basic | 73,329,309 | 62,743,154 |
Weighted average common shares outstanding - diluted | 73,329,309 | 62,743,154 |
Product Revenue, Net | ||
Revenue: | ||
Total revenue, net | $ 1,753 | $ 7,514 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (PARENTHETICAL) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Cost of goods sold, related party expense | $ 71 | $ 301 |
Selling, general and administrative, related party expense | 128 | 126 |
Research and development, related party expense | $ 59 | $ 62 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (5,146) | $ (5,703) |
Other comprehensive loss: | ||
Foreign currency translation adjustment | 225 | (137) |
Total other comprehensive income (loss) | 225 | (137) |
Comprehensive loss | $ (4,921) | $ (5,840) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF NONCONTROLLING INTEREST, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Legacy Gelesis Redeemable Convertible Preferred Stock | Noncontrolling Interest | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive (Loss) Income | Accumulated Deficit |
Balance at Dec. 31, 2021 | $ (329,836) | $ 1 | $ (64,549) | $ 219 | $ (265,507) | ||
Temporary Equity Balance at Dec. 31, 2021 | $ 311,594 | $ 11,855 | |||||
Temporary Equity Balance, shares at Dec. 31, 2021 | 18,736,936 | ||||||
Balance, shares at Dec. 31, 2021 | 2,410,552 | ||||||
Accretion of legacy gelesis senior preferred stock to redemption value prior to business combination | (37,934) | (37,934) | |||||
Temporary Equity, Accretion of legacy gelesis senior preferred stock to redemption value prior to business combination | $ 37,934 | ||||||
Conversion of legacy gelesis convertible preferred stock into common stock upon business combination | 349,528 | 349,528 | |||||
Conversion of legacy gelesis convertible preferred stock into common stock upon business combination, shares | 48,566,655 | ||||||
Temporary Equity, Conversion of legacy gelesis convertible preferred stock into common stock upon business combination | $ (349,528) | ||||||
Temporary Equity, Conversion of legacy gelesis convertible preferred stock into common stock upon business combination, shares | (48,566,655) | ||||||
Proceeds from business combination, net of issuance costs and assumed liabilities | 70,478 | $ 6 | 70,472 | ||||
Proceeds from business combination, net of issuance costs and assumed liabilities, shares | 17,399,440 | ||||||
Conversion of legacy gelesis preferred stock warrants into common stock warrants upon business combination | 16,747 | 16,747 | |||||
Recognition of earnout liability upon Business Combination | (58,871) | (58,871) | |||||
Assumed private placement warrant liability upon business combination | (8,140) | (8,140) | |||||
Exercise of warrants | 4 | 4 | |||||
Exercise of warrants, shares | 176,126 | ||||||
Stock based compensation expense | 13,989 | 13,989 | |||||
Accretion of noncontrolling interest put option to redemption value | (88) | (88) | |||||
Temporary Equity, Accretion of noncontrolling interest put option to redemption value | 88 | ||||||
Foreign currency translation adjustment | (137) | (137) | |||||
Temporary Equity, Foreign currency translation adjustment | (239) | ||||||
Net loss | (5,703) | (5,703) | |||||
Balance at Mar. 31, 2022 | 10,037 | $ 7 | 281,246 | 82 | (271,298) | ||
Temporary Equity Balance at Mar. 31, 2022 | 11,704 | ||||||
Temporary Equity Balance, shares at Mar. 31, 2022 | 29,829,719 | ||||||
Balance, shares at Mar. 31, 2022 | 68,552,773 | ||||||
Balance at Dec. 31, 2022 | (25,056) | $ 7 | 297,468 | 104 | (322,635) | ||
Temporary Equity Balance at Dec. 31, 2022 | 12,590 | ||||||
Temporary Equity Balance, shares at Dec. 31, 2022 | 29,829,719 | ||||||
Balance, shares at Dec. 31, 2022 | 73,325,022 | ||||||
Stock based compensation expense | 2,091 | 2,091 | |||||
Release of restricted stock units, shares | 7,566 | ||||||
Issuance of common stock warrants | 1,297 | 1,297 | |||||
Income allocated to noncontrolling interest holder | (100) | (100) | |||||
Temporary Equity, Income allocated to noncontrolling interest holder | 100 | ||||||
Foreign currency translation adjustment | 225 | 225 | |||||
Temporary Equity, Foreign currency translation adjustment | 206 | ||||||
Net loss | (5,146) | (5,146) | |||||
Balance at Mar. 31, 2023 | $ (26,689) | $ 7 | $ 300,856 | $ 329 | $ (327,881) | ||
Temporary Equity Balance at Mar. 31, 2023 | $ 12,896 | ||||||
Temporary Equity Balance, shares at Mar. 31, 2023 | 29,829,719 | ||||||
Balance, shares at Mar. 31, 2023 | 73,332,588 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities: | ||
Net loss | $ (5,146) | $ (5,703) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization of intangible assets | 567 | 567 |
Reduction in carrying amount of right-of-use assets | 148 | 132 |
Depreciation | 2,009 | 1,019 |
Stock-based compensation | 2,091 | 13,989 |
Unrealized loss on foreign currency transactions | (74) | 65 |
Noncash interest expense | (366) | 40 |
Change in the fair value of earnout liability | (563) | (33,869) |
Change in the fair value of warrants | (130) | (3,484) |
Change in the fair value of convertible promissory notes | (4,959) | 156 |
Change in fair value of One S.r.l. call option | (536) | 258 |
Change in fair value of interest rate swap contract | 389 | |
Changes in operating assets and liabilities: | ||
Account receivables | (39) | (1,177) |
Grants receivable | (4,975) | (198) |
Prepaid expenses and other current assets | (1,953) | (2,010) |
Inventories | 1,036 | (2,888) |
Other assets | 4,808 | |
Accounts payable | 2,201 | 3,502 |
Accrued expenses and other current liabilities | (2,759) | 528 |
Operating lease liabilities | 1,345 | (134) |
Deferred income | (1,316) | (5,550) |
Other long-term liabilities | (85) | (815) |
Net cash used in operating activities | (8,696) | (35,183) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (224) | (1,963) |
Net cash used in investing activities | (224) | (1,963) |
Cash flows from financing activities: | ||
Proceeds from Business Combination, net of transaction costs | 70,478 | |
Principal repayment of notes payable | (408) | (418) |
Repayment of convertible promissory notes | (27,284) | |
Proceeds from issuance of convertible promissory notes | 5,000 | |
Proceeds from the exercise of warrants | 4 | |
Net cash provided by financing activities | 4,592 | 42,780 |
Effect of exchange rates on cash | 19 | (46) |
Net (decrease) increase in cash | (4,309) | 5,588 |
Cash and cash equivalents at beginning of year | 7,412 | 28,397 |
Cash and cash equivalents at end of period | 3,103 | 33,985 |
Noncash investing and financing activities: | ||
Purchases of property and equipment included in accounts payable and accrued expense | 316 | 1,721 |
Deferred financing costs included in accounts payable and accrued expenses | 557 | |
Recognition of earnout liability | 58,871 | |
Recognition of private placement warrant liability | 8,140 | |
Supplemental cash flow information: | ||
Interest paid on notes payable | $ 118 | $ 95 |
Nature of the Business and Basi
Nature of the Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of the Business and Basis of Presentation | 1. Nature of the Business and Basis of Presentation Nature of Business Gelesis Holdings, Inc., or the Company, formerly known as Capstar Special Purpose Acquisition Corp. or “CPSR ” , is a consumer-centered biotherapeutics company incorporated under the laws of the State of Delaware. The Company aims to transform weight management through proprietary hydrogel technology, inspired by the compositional and mechanical properties of raw vegetables. Since its inception, the Company has devoted substantially all of its efforts to business planning, licensing technology, research and development, commercial activities, recruiting management and technical staff and raising capital and has financed its operations through the issuance of redeemable convertible preferred and common stock, a license and collaboration agreement, supply and distribution agreements, long-term loans, convertible promissory note financings, and government grants. The Company currently manufactures and markets Plenity® (the “Product ” ), which is based on a proprietary hydrogel technology. Plenity received a de novo clearance from the FDA on April 12, 2019 to aid in weight management when used in conjunction with diet and exercise. In 2020, the Company received its original Conformité Européenne (CE) certificate which allowed Plenity to be marketed as a medical device in Europe as well as the rest of the world where CE mark is acceptable. Plenity has been commercially available by prescription in the United States since May 2020. In January 2023, the Company made a 510 (k) submission to the FDA to switch Plenity from prescription (“Rx”) to over-the-counter (“OTC”). On July 19, 2021, Gelesis, Inc. (together with its consolidated subsidiaries, “Legacy Gelesis”) entered into a Business Combination Agreement (as amended on November 8, 2021 and December 30, 2021, the “Business Combination Agreement”) with CPSR, a Delaware corporation and special purpose acquisition company, and CPSR Gelesis Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of CPSR (“Merger Sub”). On January 13, 2022, Legacy Gelesis, CPSR, and Merger Sub consummated the business combination (“Business Combination”) pursuant to the terms of the Business Combination Agreement. Pursuant to the Business Combination Agreement, on the closing date, (i) Merger Sub merged with and into Legacy Gelesis (the “Merger”), with Legacy Gelesis as the surviving company in the Merger, and, after giving effect to such Merger, Legacy Gelesis became a wholly-owned subsidiary of CPSR and (ii) CPSR changed its name to “Gelesis Holdings, Inc.” (together with its consolidated subsidiaries, “Gelesis Holdings”). The Business Combination, together with the PIPE Investment and the sale of the Backstop Purchase Shares, generated approximately $ 105 million in gross proceeds and $ 70.5 million in net proceeds. On January 14, 2022, Gelesis Holdings’ common stock and public warrants began trading on the New York Stock Exchange (“NYSE”) under the symbols “GLS” and “GLS.W”, respectively. In January 2023, the Company’s public warrants were delisted from the NYSE due to low trading price. As of April 10, 2023, the NYSE Regulation reached a decision to delist the Company’s common stock and subsequently on April 26, 2023, the Company’s common stock was delisted from the NYSE. The Business Combination was accounted for as a reverse recapitalization in conformity with accounting principles generally accepted in the United States. Under this method of accounting, CPSR has been treated as the “acquired” company for financial reporting purposes. This determination was primarily based on the Legacy Gelesis’ stockholders comprising a relative majority of the voting power of the combined company, the Legacy Gelesis’ operations prior to the acquisition comprising the only ongoing operations of Gelesis Holdings, the majority of Gelesis Holdings’ board of directors appointment by Legacy Gelesis, and Legacy Gelesis’ senior management comprising the entirety of the senior management of Gelesis Holdings. Accordingly, for accounting purposes, the consolidated financial statements of Gelesis Holdings represent a continuation of the consolidated financial statements of Legacy Gelesis with the Business Combination being treated as the equivalent of Legacy Gelesis issuing stock for the net assets of CPSR, accompanied by a recapitalization. The net assets of CPSR are stated at historical costs, with no goodwill or other intangible assets recorded. Going Concern The unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the ordinary course of business. The unaudited condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets and liabilities that might be necessary should the Company be unable to continue as a going concern. The Company has a history of incurring substantial operating losses and has financed its operations primarily from the issuance of equity, promissory notes, government grants, supply and distribution agreements and collaborations and licensing arrangements. Such operating losses and negative cash flows from operations have continued throughout Q1 2023 and the Company expects they will continue in the foreseeable future. The Company expects its cash on hand as of the date of the condensed consolidated financial statements, proceeds from the initial and second closing of the 2023 Convertible Senior Secured Notes, and collection of accounts and grants receivable, are not sufficient to meet the Company’s current obligations and not at least twelve months beyond the date of issuance of the condensed consolidated financial statements. In light of current levels of liquidity, the Company has significantly reduced discretionary spending as well as headcount from prior levels, particularly with respect to discretionary sales and marketing activities, manufacturing and supply chain functions, and research and development. These conditions raise substantial doubt about the Company’s ability to continue as a going concern and may adversely impact the sale of Plenity. The Company will need to raise additional capital in future periods to fund its operations. The Company will seek to raise necessary funds through a combination of equity issuances, debt financings, strategic collaborations and licensing arrangements, government grants, or other financing mechanisms. The Company’s ability to fund the completion of its ongoing and planned clinical studies, as well as its regulatory and commercial efforts, may be substantially dependent upon whether the Company can obtain sufficient funding at acceptable terms. If adequate sources of funding are not available to the Company, the Company may be required to delay, reduce or eliminate research and development programs, reduce or eliminate commercialization efforts, and reduce its headcount. Additionally, the Company is subject to risks common to companies in the biotechnology industry, including but not limited to, risks of failure of the full-scope product commercialization in targeted markets, clinical trials and preclinical studies, the impact of the COVID-19 pandemic on the Company’s supply chain and results of operations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, and development by competitors of technological innovations. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The unaudited interim condensed consolidated financial statements of the Company included herein have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") as found in the Accounting Standards Codification ("ASC"), Accounting Standards Update ("ASU") of the Financial Accounting Standards Board ("FASB") and the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations. Accordingly, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements as of and for the year ended December 31, 2022 and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 28, 2023. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited financial statements, and updated, as necessary, in this report. In the opinion of the Company's management, the accompanying unaudited interim condensed consolidated financial statements contain all adjustments that are necessary to present fairly the Company's financial position as of March 31, 2023, the results of its operations, non-controlling interest, redeemable convertible preferred stock and stockholders' deficit and cash flows for the three months ended March 31, 2023 and 2022. Such adjustments are of a normal and recurring nature. The results for the three months ended March 31, 2023 are not necessarily indicative of the results for the year ending December 31, 2023 or for any future period. The Company’s condensed consolidated financial statements include the accounts of the Company, its two wholly-owned subsidiaries and a variable interest entity (“VIE”), Gelesis S.r.l., in which the Company has a controlling interest and is the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations or financial position. Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of income and expenses during the reporting period. The Company assesses the above estimates on an ongoing basis; however, actual results could materially differ from those estimates. Subsequent Event(s) The Company considers events or transactions that occur after the balance sheet date but before the condensed consolidated financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. The Company evaluated all events and transactions through the date these condensed consolidated financial statements were filed with the Securities and Exchange Commission (“SEC”) or were available to be issued. Business Combination The Company accounts for its business combinations using the acquisition method of accounting. The purchase price is attributed to the fair value of the assets acquired and liabilities assumed. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are measured separately at their fair values as of the acquisition date. The excess of the purchase price of acquisition over the fair value of the identifiable net assets of the acquiree is recorded as goodwill. The results of businesses acquired in a business combination are included in the Company's consolidated financial statements from the date of acquisition. As discussed in Note 1, on January 13, 2022, the Company consummated the Business Combination pursuant to the Business Combination Agreement with CPSR dated July 19, 2021, as amended on November 8, 2021 and December 30, 2021 . The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, CPSR, who was the legal acquirer, was treated as the acquired company for financial reporting purposes. Accordingly, the Business Combination was treated as the equivalent of Gelesis issuing stock for the net assets of CPSR, accompanied by a recapitalization. Fair Value of Financial Instruments The guidance in FASB ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), defines fair value and establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Level 1 – Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 – Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, the Company’s own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. The Company uses prices and inputs that are current as of the measurement date, including during periods of market dislocation. In periods of market dislocation, the observability of prices and inputs may be reduced for many instruments. This condition could cause an instrument to be reclassified from Level 1 to Level 2 or Level 2 to Level 3. The Company’s earnout liability, private placement warrants, interest rate swaps, call option liability, and convertible promissory notes are recorded at fair value on a recurring basis. The carrying amount of accounts receivable, grants receivable, accounts payable and accrued expenses are considered a reasonable estimate of their fair value, due to the short-term maturity of these instruments. The carrying amount of notes payable is also considered to be a reasonable estimate of the fair value based on the nature of the debt and that the debt bears interest at the prevailing market rate for instruments with similar characteristics. The Company’s cash equivalents and marketable securities are carried at fair value, determined according to the fair value hierarchy described above. Earnout Liability: In connection with the Business Combination, Legacy Gelesis equity holders received the right to receive additional common stock upon the achievement of certain earnout targets. As the earnout consideration contains a settlement provision that precludes it from being indexed to the Company’s stock, it is classified as a liability held at fair value in accordance ASC 815 and the instrument is adjusted to fair value at each reporting period. In determining the fair value of the earnout liability at inception and on a recurring basis, the Company utilizes the Monte Carlo simulation value model where the fair value of the earnout is the present value of a distribution of potential outcomes on a daily basis over the term of the earnout period. Private Placement Warrant Liability: The Private Placement Warrants are recognized as liabilities in accordance with ASC 815. Accordingly, the Company recognizes the warrant instruments as liabilities held at fair value and adjusts the instruments to fair value at each reporting period. In determining the fair value of the Private Placement Warrant liability, the Company utilized a modified Monte Carlo simulation value model at inception and on a recurring basis. One Srl Call Option: In connection with the October 2020 amended agreement with One Srl, the Company granted One a contingent call option to buy back the 10 % ownership that the Company acquired in the 2019 One Amendment. The One Srl call option was recorded as a liability held at fair value at the date of issuance and is remeasured at each subsequent reporting date with changes in fair value recorded in other income (expense) in the accompanying condensed consolidated statements of operations. Fair value is determined using a Black-Scholes option pricing model. Convertible promissory notes: The convertible promissory notes issued in conjunction with the Company’s bridge financing arrangements from time to time were recognized at fair value at issuance and subsequent changes in fair value were recorded in the accompanying consolidated statements of operations (see Note 12). Fair value of the promissory notes is determined using a multiple scenario-based valuation method. The fair value of the hybrid instrument was determined by calculating the value of the instrument in each scenario “with” the respective conversion feature and “without”. The significant inputs used in estimating the fair value of the convertible promissory notes include the estimated discount rate, expected term, and the outcome probability with respect to each scenario. Revenue Recognition Product Revenue The Company commercializes Plenity in the U.S. markets principally through synergistic partnerships with online pharmacies and telehealth providers, which in turn sell Plenity directly to patients based on prescriptions. Outside the U.S., the Company primarily seeks collaborations with strategic partners to market Plenity and obtain necessary regulatory approvals as necessary. Product revenue is recognized by the Company in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services when the customer obtains control of the product, which occurs at a point in time, when the product is received by the Company's customers. Reserves for Variable Consideration Revenues from product sales are recorded as product revenue at the net sales price (transaction price), which includes estimates of variable consideration that are reimbursable to customers for which reserves are established and which result from (a) shipping charges to end-users, (b) pharmacy dispensing and platform fees, (c) merchant and processing fees, (d) promotional discounts offered by the Company to end-users, and (e) reserves for expected product quality returns. These reserves for contractual adjustments are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the customer) or a current liability (if the amount is payable to a party other than the customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as the Company's historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company's best estimates of the amount of consideration to which the Company is entitled based on the terms of the contract(s). The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company's estimates. If actual results in the future vary from the Company's estimates, the Company will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known. The Company has no plan to seek government or commercial payor reimbursements in the US or the overseas markets. Therefore, reserves for variable consideration do not contain any components related to government and payor rebates or chargebacks. Product Returns The Company generally does not accept customer returns, except for product quality related cases. The Company evaluates quality related returns and adjusts the corresponding product warranty reserves and liabilities at least quarterly and at the end of each reporting period. Stock-Based Compensation The Company accounts for all stock-based compensation awards granted to employees and non-employees in accordance with ASC 718, Compensation – Stock Compensation . The Company’s stock-based compensation consists primarily of stock options. The measurement date for share-based awards is the date of grant, and stock-based compensation costs are recognized as expense over the respective requisite service periods, which are typically the vesting period. The fair value of each stock option grant is estimated as of the date of grant using the Black-Scholes option-pricing model that requires management to apply judgment and make estimates, including: • exercise price: The exercise price is the fair market value on grant date, which shall mean the closing sale price of common stock, as reported on such market on that date (or if there are no market quotations for such date, the determination shall be made by reference to the last date preceding such date for which there are market quotations); • expected volatility: As the Company was previously a privately-owned company, there is not sufficient historical volatility for the expected term of the options. Therefore, the Company used an average historical share price volatility based on an analysis of reported data for a peer group of comparable companies for which historical information is available. For these analyses, the Company selects companies with comparable characteristics to itself including enterprise value, risk profiles, position within the industry, 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 intends to consistently apply this process using representative companies until a sufficient amount of historical information regarding the volatility of its own share price becomes available; • risk-free interest rate, which is based on the U.S. Treasury yield curve in effect at the time of grant commensurate with the expected term assumption; • expected term, which is calculated using the simplified method, as prescribed by the Securities and Exchange Commission Staff Accounting Bulletin No. 107, Share-Based Payment, as the Company has insufficient historical information regarding its stock options to provide a basis for an estimate. Under this approach, the weighted-average expected life is presumed to be the average of the contractual term of ten years and the weighted-average vesting term of the stock options, taking into consideration multiple vesting tranches; • dividend yield, which is zero based on the fact that the Company never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. The measurement date for non-employee awards is the date of grant without changes in the fair value of the award. Stock-based compensation costs for non-employees are recognized as expense over the vesting period. Stock-based compensation expense is classified in the condensed consolidated statements of operations based on the function to which the related services are provided. Forfeitures are recorded as they occur. Recently Issued Pronouncements In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842): Common Control Arrangements. This update requires leasehold improvements associated with common control leases be amortized by the lessee over the useful life of the leasehold improvements to the common control group (regardless of the lease term) as long as the lessee controls the use of the underlying asset (the leased asset) through a lease. However, if the lessor obtained the right to control the use of the underlying asset through a lease with another entity not within the same common control group, the amortization period may not exceed the amortization period of the common control group. Further, leasehold improvements associated with common control leases be accounted for as a transfer between entities under common control through an adjustment to equity if, and when, the lessee no longer controls the use of the underlying asset. Those leasehold improvements are subject to the impairment guidance in Topic 360, Property, Plant, and Equipment . This update is effective for annual periods beginning after December 15, 2023, and early application is permitted. This guidance should be applied either (i) prospectively to all new leasehold improvements recognized on or after the date of initial application; (ii) prospectively to all new and existing leasehold improvements recognized on or after the date of initial application, with any remaining unamortized balance of existing leasehold improvements amortized over their remaining useful life to the common control group determined at that date; or (iii) retrospectively to the beginning of the period in which the entity first applied Topic 842 , with any leasehold improvements that otherwise would not have been amortized or impaired recognized through a cumulative-effect adjustment to the opening balance of retained earnings at the beginning of the earliest period presented in accordance with Topic 842 . The Company is evaluating the potential impact of this update and does not intend to early adopt this update for fiscal year 2023. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 3. Fair Value Measurements Assets and liabilities measured at fair value on a recurring basis consisted of the following at March 31, 2023 (in thousands): Fair Value Measurements Fair Value Quoted Prices Significant Significant Asset: Interest rate swap contract (see Note 11) $ 747 $ — $ 747 $ — Liabilities: Convertible promissory notes (see Note 11) 25,985 — — 25,985 One S.r.l. call option (see Note 10) 141 — — 141 Total liabilities measured at fair value $ 26,126 $ — $ — $ 26,126 Assets and liabilities measured at fair value on a recurring basis consisted of the following at December 31, 2022 (in thousands): Fair Value Measurements Fair Value Quoted Prices Significant Significant Asset: Interest rate swap contract (see Note 11) $ 800 $ — $ 800 $ — Liabilities: Convertible promissory notes (see Note 11) 27,403 — — 27,403 Earnout liability (see Note 13) 563 — — 563 Private placement warrant liability (see Note 12) 130 — — 130 One S.r.l. call option (see Note 10) 674 — — 674 Total liabilities measured at fair value $ 28,770 $ — $ — $ 28,770 The following table presents a summary of the changes in the fair value of the Company’s Level 3 financial instruments during the three months ended March 31, 2023: Convertible Promissory Notes One S.r.l. Call Option Earnout Liability Private Placement Warrant Liability Balance at December 31, 2022 $ 27,403 $ 674 $ 563 $ 130 Issuance of convertible promissory notes 5,000 — — — Transaction price allocated to warrant issuance ( 1,459 ) — — — Changes in fair value ( 4,959 ) ( 536 ) ( 563 ) ( 130 ) Foreign currency translation adjustment — 3 — — Settlement — — — Balance at March 31, 2023 $ 25,985 $ 141 $ — $ — There were no transfers into or out of level 3 instruments and/or between level 1 and level 2 instruments during the three months ended March 31, 2023 . The fair value measurement of the convertible promissory notes, Legacy Gelesis preferred stock warrant liability, One Srl call option liability, earnout liability and private placement warrant liability utilized inputs not observable in the market and thus represents a Level 3 measurement. |
Product Revenue Reserve and All
Product Revenue Reserve and Allowance | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Product Revenue Reserve and Allowance | 4. Product Revenue Reserve and Allowance The Company sells the Product principally to a limited number of customers consisting of telemedicine and online pharmacies, that in turn resell the Product to consumers. Revenue for t he three months ended March 31, 2023 and March 31, 2022 consisted of the following (in thousands): For the three months ended March 31, 2023 2022 Roman Health Pharmacy LLC $ 1,015 $ 6,499 GoGoMeds 661 1,015 CMS 77 — Total $ 1,753 $ 7,514 Roman Health Pharmacy LLC (“Ro”) During the three months ended March 31, 2023 and March 31, 2022 , the Company recognized $ 1.0 million and $ 6.5 million, respectively, of product revenue, net, in the accompanying condensed consolidated statements of operations with respect to Roman Health Pharmacy LLC, or Ro. At March 31, 2023 and December 31, 2022 , the Company recorded a deferred income balance of $ 24.7 million and $ 25.9 million, respectively, in the accompanying condensed consolidated balance sheets representing customer prepayment available to be used for future Product purchases with respect to Ro. GoGoMeds (“GGM”) During three months ended March 31, 2023 and March 31, 2022 , the Company recognized $ 0.7 million and $ 1.0 million, respectively, of product revenue, net, in the accompanying condensed consolidated statements of operations with respect to Specialty Medical Drugstore, LLC, d/b/a/ GoGoMeds, or GGM. At March 31, 2023 and December 31, 2022, the Company recorded an accounts receivable balance of $ 1.3 million and $ 1.1 million, respectively, prior to reserves and allowances, in the accompanying condensed consolidated balance sheets with respect to GGM. CMS Bridging DMCC (“CMS”) During the three months ended March 31, 2023 and March 31, 2022 , the Company recognized $ 0.1 million and $ 0.0 million, respectively, of product revenue, net, in the accompanying condensed consolidated statements of operations with respect to CMS. Reserves and Allowances The following table summarizes the activity in the product revenue reserve and allowances during the three months ended March 31, 2023 and March 31, 2022 (in thousands): 2023 2022 Balance at January 1, $ 23 $ 82 Provision related to product sales 210 574 Credits and payments made ( 226 ) ( 418 ) Balance at March 31, $ 7 $ 238 At March 31, 2023 and 2022, product related reserve and allowances comprised solely contractual adjustments owed to the Company’s telehealth and online pharmacy partners, which were netted to accounts receivable in the Company’s condensed consolidated balance sheets for the year. Through March 31, 2023 , there had been no product related reserves or allowances owed to other parties, including the federal and state governments or their agencies. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | 5. Inventories Inventories consisted of the following (in thousands): March 31, December 31, 2023 2022 Raw materials $ 9,394 $ 9,549 Work in process 4,361 4,695 Finished goods 5,303 5,955 Inventories, gross 19,058 20,199 Less: inventory reserves ( 13,117 ) ( 13,334 ) Total inventories $ 5,941 $ 6,865 In January 2023, the Company submitted a 510(k) application with the FDA to change the classification of Plenity from prescription only to OTC, which, if cleared by the FDA, would make Plenity available to consumers without the need for a prescription. If Plenity is approved by the FDA as an OTC weight management aid, a portion of finished goods and raw material inventories with Rx labeling and marking information would become obsolete. Additionally, finished goods and work-in-process inventories with expiration dates ranging between July 2023 and March 2024 are subject to shelf-life limitations. As of March 31, 2023 , the Company estimated that approximately $ 5.0 million finished goods, $ 4.3 million work-in-progress and $ 3.8 million raw material inventories wouldn’t be sold or utilized. Therefore, the Company recorded an aggregate $ 13.1 million excess and obsolescence inventory reserves as a component of inventories on the accompanying consolidated balance sheet as of March 31, 2023 . |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 3 Months Ended |
Mar. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses And Other Current Assets | 6. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following (in thousands): March 31, December 31, 2023 2022 Prepaid expenses $ 277 $ 314 Prepaid insurance 1,844 268 Prepaid contract research costs 145 189 Research and development tax credit 588 567 Value added tax receivable 2,102 2,036 Income tax receivable 207 203 Investment tax credit 1,488 1,050 Prepaid expenses and other current assets $ 6,651 $ 4,627 |
Property and Equipment, Net
Property and Equipment, Net | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | 7. Property and Equipment, Net Property and equipment, net, consists of the following (in thousands): March 31, December 31, 2023 2022 Laboratory and manufacturing equipment $ 41,303 $ 29,944 Land and buildings 8,556 10,673 Leasehold improvements 1,552 1,525 Computer equipment and software 824 811 Capitalized software 232 232 Construction in process 15,649 24,287 Property and equipment – at cost 68,116 62,907 Less accumulated depreciation ( 9,762 ) ( 8,137 ) Property and equipment – net $ 58,354 $ 59,335 The Company owns and operates commercial manufacturing and research and development facilities in Italy, including a 51,000 square foot facility, which the Company expects to further expand to an 88,600 square foot facility, as well as approximately 12 acres of land, where the Company initiated construction of an additional 207,000 square foot facility. Both facilities are near the Town of Lecce in the Puglia region of Italy. Property and equipment classified as construction in process at March 31, 2023 and December 31, 2022 are related to the development of manufacturing lines that have not yet been placed into service at March 31, 2023 and December 31, 2022, respectively. Depreciation expense was approximately $ 2.0 million and $ 1.0 million during the three months ended March 31, 2023 and 2022 , respectively. |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Mar. 31, 2023 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | 8. Accrued Expenses Accrued expenses and other current liabilities consist of the following (in thousands): March 31, December 31, 2023 2022 Accrued payroll and related benefits $ 1,656 $ 1,550 Accrued professional fees and outside contractors (including 35 and $ 153 , respectively) 857 3,521 Accrued property, plant and equipment additions 180 378 Accrued inventory and manufacturing expense 347 1,020 Unpaid portion of One S.r.l. equity acquisition (see Note 10) 2,754 2,656 Tax payables 578 543 Deferred legal fees 738 738 Accrued interest 370 62 Total accrued expenses $ 7,480 $ 10,468 |
Other Long-Term Liabilities
Other Long-Term Liabilities | 3 Months Ended |
Mar. 31, 2023 | |
Other Liabilities Disclosure [Abstract] | |
Other Long-Term Liabilities | 9. Other Long-Term Liabilities Other long-term liabilities consist of the following (in thousands): March 31, December 31, 2023 2022 Long-term tax liabilities $ 141 $ 224 One S.r.l. call option (see Note 10) 141 674 Total other long-term liabilities $ 282 $ 898 |
Significant Agreements
Significant Agreements | 3 Months Ended |
Mar. 31, 2023 | |
Significant Agreements [Abstract] | |
Significant Agreements | 10. Significant Agreements Puglia Grants In May 2020, the Company was awarded a grant by the Puglia region of Italy as an incentive to manufacture and carry out research and development activities in Italy (“PIA 1 Grant”), with the key underlying activity being the development of the commercial facility to expand production capacity for the Product. In November 2020, the Company was awarded a second grant by the Puglia region of Italy as an incentive to manufacture and carry out research and development activities in Italy (“PIA 2 Grant”), with the key underlying activity being the development of a second manufacturing line at the commercial facility to expand production capacity for the Product, and research and development activities targeting new gastrointestinal health indications. The following table represents amounts recognized on the consolidated statements of operations for the three months ended March 31, 2023 and March 31, 2022 in relation to the Puglia 1 Grant and Puglia 2 Grant (in thousands): For the three months ended March 31, 2023 2022 PIA 1 Grant income $ 194 $ 212 Income attributable to R&D expense 18 — Income attributable to investments in facilities and equipment 176 212 PIA 2 Grant Income $ 337 $ 195 Income attributable to R&D expense 232 195 Income attributable to investments in facilities and equipment 105 — The following table represents amounts recorded on the consolidated balance sheets at March 31, 2023 and December 31, 2022 in relation to the Puglia 1 Grant and Puglia 2 Grant (in thousands): March 31, December 31, 2023 2022 PIA 1 Grant Grant receivable 3,290 3,237 Deferred income 4,886 5,001 Current portion of deferred income 780 771 PIA 2 Grant Grant receivable 5,168 122 Long-term grant receivable — 4,732 Deferred income 3,452 3,502 Current portion of deferred income 427 420 One S.r.l. (“One”) Amended Patent License and Assignment Agreement In October 2008 and December 2008, the Company entered into a patent license and assignment agreement and master agreement with One, the original inventor and owner of the Company’s core patents and a related party to the Company (see Notes 18 and 19), to license and subsequently purchase certain intellectual property to develop hydrogel-based product candidates. The One agreements were subsequently amended and restated in December 2014 (the “2014 One Amendment”), June 2019 (the “2019 One Amendment”), October 2020 (the “2020 One Amendment”) and August 2022 (the "2022 One Amendment"). In conjunction with the 2019 One Amendment, the Company accounted for the reduction in royalties that the Company is required to pay on future net revenues as an intangible asset under ASC 350, Intangibles – Goodwill and Other, which shall be amortized over its useful life, which was determined to be the earliest expiration of patents related to the underlying intellectual property in November 2028. Additionally, the Company acquired a 10 % equity interest in One in exchange for cash consideration. The Company accounted for the acquisition of the 10 % equity interest in One under ASC 323, Investments – Equity Method and Joint Ventures. At March 31, 2023 and December 31, 2022, respectively, the remaining undiscounted payment obligations to One shareholders were included in accrued expenses in the accompanying condensed consolidated balance sheets as it is expected to be settled within the next twelve months. None of the future milestones under the amended and restated master agreement, have been met, or are deemed to be probable of being met, at the transaction date or at March 31, 2023 and December 31, 2022, respectively. In conjunction with the 2020 One Amendment, the Company cancels its obligation to issue a warrant for redeemable convertible preferred stock in the 2019 One Amendment for additional commercial milestone consideration and a warrant to purchase common stock. Additionally, the Company granted One a contingent call option to buy back the 10 % ownership that the Company acquired in the 2019 One Amendment at an exercise price of € 6.0 million (approximately $ 6.6 million at March 31, 2023). The call option is only exercisable upon (1) a change of control or a deemed liquidation event by the Company, as defined, in the Company’s Restated Certification of Incorporation or (2) the date in which the Company’s current Chief Executive Officer is no longer affiliated with the Company in his capacity as either an executive officer or a member of the board of directors. The One Srl call option was recorded as a liability held at fair value at the date of issuance and is remeasured at each subsequent reporting date with changes in fair value recorded in other income (expense) in the accompanying condensed consolidated statements of operations. Fair value is determined using a Black-Scholes option pricing model. The significant inputs used in estimating the fair value of call option liability include the estimated fair value of the underlying stock price, expected term, risk free interest rate, and expected volatility. The following represents a summary of the changes to Company’s One Srl call option liability during the three months ended March 31, 2023 and March 31, 2022 (in thousands): For the Three Months Ended March 31, 2023 2022 Balance at Beginning of Period $ 674 $ 2,416 Change in fair value ( 536 ) 258 Foreign currency translation gain 3 ( 51 ) Balance at the End of Period $ 141 $ 2,623 The following weighted average assumptions were used to determine the fair value of the One Srl call option liability at March 31, 2023 and December 31, 2022: March 31, December 31, 2023 2022 Expected term 0.5 years 4.0 years Expected volatility 150.0 % 86.0 % Expected dividend yield 0.0 % 0.0 % Risk free interest rate 4.9 % 4.2 % Estimated fair value of ownership interest $ 1,622 $ 1,772 Exercise price of call option $ 6,527 $ 6,422 Research Innovation Fund (“RIF”) Financing In August 2020, Gelesis S.r.l. entered into a loan and equity agreement with RIF, an investment fund out of the EU, whereby Gelesis S.r.l. received € 10.0 million (approximately $ 10.9 million at March 31, 2023 ) from RIF as an equity investment and € 15.0 million (approximately $ 16.3 million at March 31, 2023 ) as a loan with a fixed interest rate of 6.35 % per annum (see Note 12). The equity investment can be called by the Company, beginning in December 2023 and ending in December 2026, by paying the investment plus 15 % percent annual interest. If the Company does not exercise this call option, beginning in January 2027 and ending in December 2027, RIF may put the investment to the Company at a cost of the investment amount plus 3.175 % percent annual interest. The loan has a termination date of December 31, 2030 and is repayable over 8 years starting 24 months subsequent to its issuance. Any unpaid principal and interest must be repaid upon exercise of the call option by the Company, or subsequent exercise of a put option by RIF. At March 31, 2023 , RIF holds approximately 20 % of the equity of Gelesis S.r.l. The Company recorded the following noncontrolling interest components in the condensed consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholders' deficit (in thousands): For the three months ended March 31, 2023 2022 Balance at Beginning of Period $ 12,590 $ 11,855 Accretion of put option — 88 Income allocated to noncontrolling interest holder 100 — Foreign currency translation adjustment 206 ( 239 ) Balance at the End of Period $ 12,896 $ 11,704 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt | 11. Debt The Company’s non-convertible debt outstanding at March 31, 2023 and December 31, 2022 is summarized as follows: March 31, December 31, 2023 2022 Italian Economic Development Agency Loan 168 331 Intesa Sanpaolo Loan 1 6,970 7,094 Intesa Sanpaolo Loan 2 5,439 5,352 Horizon 2020 Loan 395 389 RIF Shareholders Loan 16,317 16,055 UniCredit Loan 4,493 4,421 Total debt obligation $ 33,782 $ 33,642 Unamortized loan discount and issuance costs ( 323 ) ( 346 ) Total debt obligation carrying amount $ 33,459 $ 33,296 Current portion $ 7,422 $ 7,954 Long-term portion $ 26,037 $ 25,342 Future maturities with respect to non-convertible debt outstanding at March 31, 2023 are as follows (in thousands): At March 31, 2023 2023 7,825 2024 5,534 2025 4,027 2026 4,047 2027 4,029 More than 5 years 8,320 Total maturities $ 33,782 2022 Promissory Notes In the third quarter of 2022, the Company issued three term promissory notes in the aggregate principal amount of $ 25.0 million to existing investor CMS, and existing investors and related parties PureTech Health LLC and SSD2 LLC, for an aggregate cash proceeds of $ 25.0 million. Each of the 2022 promissory notes is unsecured and bears interest at a rate of 15 % per annum. Each promissory note matures on the earlier of (a) December 31, 2023 or (b) five ( 5 ) business days following a qualified financing. Upon a payment default under any promissory note that has not been cured after five days (i) the Company will be required to issue certain warrants to the holders as defined by the promissory note agreements and (ii) the holders will have the option to convert outstanding principal and accrued interest into a number of shares of Gelesis common stock as defined by the promissory note agreements. At March 31, 2023 and December 31, 2022, the aggregate outstanding balance of the 2022 promissory notes was $ 22.6 million and $ 27.4 million recorded at fair value in the accompanying condensed consolidated balance sheet. During the three months ended March 31, 2023 , the Company recognized a fair value gain of $ 4.8 million relating to the 2022 promissory notes. The following assumptions were used to determine the fair value of the 2022 promissory notes at March 31, 2023 and December 31, 2022: March 31, 2023 December 31, 2022 Expected term 9 months 1 year Weighted average discount rate 26.0 % 26.0 % Probability of repayment after qualified financing — 50.0 % Probability of holder electing conversion option 10.0 % 50.0 % Probability of a business combination 60.0 % — Probability of Company default 30.0 % — February 2023 Senior Secured Note and Warrant Purchase Agreement On February 21, 2023, the Company entered into a Note and Warrant Purchase Agreement with PureTech ("the February 2023 NPA"), pursuant to which the Company issued a short-term convertible senior secured note ("Senior Secured Note") in the aggregate principal amount of $ 5.0 million and warrants to purchase 23,688,047 shares of Common Stock. The warrants have an exercise price of $ 0.2744 and may not be exercised prior to the receipt of stockholders' approval. The Senior Secured Note bears interest at a rate of 12 % per annum, and matures on July 31, 2023 , unless earlier converted or the maturity is extended as described within the definitive agreements. The Company may issue up to an additional $ 5.0 million to PureTech upon mutual acceptance of the Company meeting certain conditions. The Senior Secured Note is secured by a first-priority lien on substantially all assets of the Company, including without limitation, intellectual property, regulatory filings and product approvals, clearances and trademarks worldwide (other than the equity interests in, and assets held by, Gelesis, S.r.l.) and a pledge of 100 % of the Senior Secured Note holder’s equity in the Company. Warrants issued pursuant to the February 2023 NPA are indexed to the Company's own stock and met the derivative scope exception provided by ASC 810-0-15-74, therefore were recorded as change in additional paid-in-capital. Accordingly, the total February 2023 NPA proceeds of $ 5.0 million was allocated between the Senior Secured Note and the warrants based on the relative respective fair value as of February 21, 2023. The Company determined that the allocated fair value of the warrants and the related deferred financing costs were $ 1.5 million and $ 0.2 million, respectively, based on the following Black-Scholes inputs as of February 21, 2023: Market price of common stock $ 0.28 Expected volatility 160 % Expected term (in years) 0.24 Risk-free interest rate 4.9 % Expected dividend yield — Accordingly, the allocated fair value of the Senior Secured Note and the related deferred financing costs were $ 3.5 million and $ 0.4 million, respectively, as of February 21, 2023. The Company elected the fair value accounting option to account for the Senior Secured Note for the initial and subsequent measurements, and expensed the allocated deferred financing costs as non-cash interest expense due to the immaterial amount and the short-term nature of the Senior Secured Note. The following assumptions were used to determine the fair value of the Senior Secured Note at March 31, 2023 and the original issuance date of February 21, 2023: March 31, 2023 February 21, 2023 Expected term 0.3 year 0.4 year Weighted average discount rate 26.9 % 26.9 % Probability of repayment after qualified financing — — Probability of holder electing conversion upon a business combination 60.0 % 50.0 % Probability of Company default 30.0 % 40.0 % Probability of holder electing conversion option upon other default events 10.0 % 10.0 % At March 31, 2023 , the aggregate outstanding balance of the Senior Secured Note was $ 3.4 million recorded at fair value in the accompanying condensed consolidated balance sheet. During the three months ended March 31, 2023 , the Company recognized a fair market gain of $ 0.1 million and non-cash interest expense of $ 0.4 million relating to the Senior Secured Note. |
Warrants Liability
Warrants Liability | 3 Months Ended |
Mar. 31, 2023 | |
Warrants and Rights Note Disclosure [Abstract] | |
Warrants Liablities | 12. Warrant Liabilities The following represents a summary of the warrant liabilities activity during the three months ended March 31, 2023: Private Placement Warrants Balance at December 31, 2022 $ 130 Changes in fair value ( 130 ) Balance at March 31, 2023 $ — Private Placement Warrants At March 31, 2023 , there were 7,520,000 Private Placement Warrants outstanding exercisable at $ 11.50 per share for common stock at the same terms as the Public Warrants. However, the warrants will not be redeemable by the Company for cash so long as they are held by the initial stockholders or their permitted transferees. The initial purchasers of the Private Placement Warrants, or their permitted transferees, also have the option to exercise the Private Placement Warrants on a cashless basis. If Private Placement Warrants are held by holders other than the initial purchasers thereof or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by the holders on the same basis as the Public Warrants. The warrants were initially recorded at fair value with subsequent changes in fair value being recorded in the accompanying condensed consolidated statements of operations. The warrants at issuance and at March 31, 2023, were valued utilizing a modified Monte Carlo Simulation value model and significant unobservable Level 3 inputs. The following weighted-average assumptions were used to determine the fair value of the Private Placement Warrant liability at December 31, 2022: Private Placement Warrants Expected term 4.0 years Expected volatility 86.0 % Expected dividend yield 0.0 % Risk free interest rate 4.0 % Price of Gelesis Common Stock $ 0.29 Exercise price of warrants $ 11.50 The Company was notified by the NYSE Regulation in March 2023 that Company had fallen below the NYSE’s continued listing standard requiring listed companies to maintain an average global market capitalization over a consecutive 30 trading day period of at least $ 15.0 million. The NYSE reached its determination and publicly announced that the GLS common stock had been suspended from trading effective April 10, 2023. The Company’s common stock under the ticker symbol of GLS or GLSH were subsequently traded on the OTC markets ranging between $ 0.01 and $ 0.05 per share. As a result, the fair value of outstanding warrant liabilities was determined to be immaterial as of March 31, 2023 . |
Earnout Liability
Earnout Liability | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instrument Detail [Abstract] | |
Earnout Liability | 13. Earnout Liability The following represents a summary of the earnout liability activity during the three months ended March 31, 2023: Earnout Liability Balance at December 31, 2022 $ 563 Changes in fair value ( 563 ) Balance at March 31, 2023 $ — At Business Combination close and at March 31, 2023 , there were 18,758,241 earnout shares unissued and unvested. At March 31, 2023, none of the triggering events had been met. The earnout liability was initially recorded at fair value with subsequent changes in fair value being recorded in the accompanying condensed consolidated statements of operations. The earnout liability at issuance and at December 31, 2022, were valued utilizing a Monte Carlo Simulation and significant unobservable Level 3 inputs. The following weighted-average assumptions were used to determine the fair value of the earnout liability at December 31, 2022: December 31, 2022 Expected term 4.0 years Expected volatility 86.0 % Expected dividend yield 0.0 % Risk free interest rate 4.0 % Price of Gelesis Common Stock $ 0.29 As noted in Note 12, the Company's common stock under the ticker symbol of GLS or GLSH were suspended from trading on the NYSE effective April 10, 2023 and subsequently traded on the OTC markets ranging between $ 0.01 and $ 0.05 per share. Therefore, the fair value of outstanding earnout liabilities was determined to be immaterial as of March 31, 2023 . |
Stockholder's Equity (Deficit)
Stockholder's Equity (Deficit) | 3 Months Ended |
Mar. 31, 2023 | |
Stockholders' Equity Note [Abstract] | |
Stockholder's Equity (Deficit) | 14. Stockholders' Equity (Deficit) Common Stock The Company’s authorized capital stock consists of (a) 900,000,000 shares of common stock, par value $ 0.0001 per share; and (b) 250,000,000 shares of preferred stock, par value $ 0.0001 per share. At March 31, 2023, there were 73,332,588 shares of common stock issued and outstanding. Public Warrants In connection with the Business Combination the Company assumed 13,800,000 Public Warrants, which entitle the holder to acquire common stock, which are exercisable at an exercise price of $ 11.50 per share. The Public Warrants will expire on the earlier to occur of five years after the completion of the Business Combination or redemption. Once the Public Warrants become exercisable, the Company may call the Public Warrants for redemption for cash: • in whole and not in part; • at a price of $ 0.01 per warrant; • upon not less than thirty (30) days’ prior written notice of redemption (the “ 30-day redemption period”) to each warrant holder; and • if, and only if, the closing price of the Common Stock equals or exceeds $ 18.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and the like) for any twenty ( 20 ) trading days within a thirty ( 30 )-trading day period ending three (3) business days before the Company sends the notice of redemption to the warrant holders. If the Company calls the Public Warrants for redemption, the Company will have the option to require all holders that wish to exercise the Public Warrants to do so on a cashless basis, as described in the warrant agreement. Additionally, in no event will the Company be required to net cash settle. At March 31, 2023 , there were 13,800,000 Public Warrants outstanding. Rollover Warrants Immediately prior to the closing of the Business Combination, Legacy Gelesis redeemable preferred stock warrants were converted into Legacy Gelesis common warrants and were subsequently split according to the exchange ratio of 2.59 . Upon closing of the Business Combination, holders received shares of common stock of the Company on a one-to-one basis. At close of Business Combination and March 31, 2023 , there were 1,836,429 and 1,660,303 warrants outstanding, respectively, with an exercise price of $ 0.02 . During the three months ended March 31, 2022, 176,126 rollover warrants were exercised for proceeds of less than $ 0.1 million. Immediately prior to the closing of the Business Combination, existing Legacy Gelesis common warrants were also split according to the exchange ratio of 2.59 . Upon closing of the Business Combination, holders received shares of common stock of the Company on a one-to-one basis. At close of Business Combination and through March 31, 2023 , respectively, there were 1,353,062 of these warrants outstanding with an exercise price of $ 4.26 . At March 31, 2023 and December 31, 2022 common stock reserved for future issuances was as follows: March 31, December 31, 2023 2022 Common stock issued upon option exercise and RSUs vesting 16,881,549 16,881,549 Conversion of all classes of redeemable convertible — — Issuances upon exercise of common stock warrants 48,421,412 24,733,365 Earnout shares 23,482,845 23,482,845 Total common stock reserved for future issuance 88,785,806 65,097,759 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | 15. Stock-Based Compensation 2021 Stock Option Plan In January 2022, the Company's Board of Directors approved the 2021 Stock Option and Incentive Plan (the "2021 Plan"), which supersedes the 2016 Stock Option and Grant Plan and the 2006 Stock Incentive Plan and provides for the grant of incentive stock options, nonqualified stock options, restricted stock awards and restricted stock units to employees, directors, and nonemployees of the Company. The 2021 Plan was authorized initially to issue 9,583,570 shares, plus on January 1, 2023 and each January 1 thereafter, the number of shares of Stock reserved and available for issuance under the Plan shall be cumulatively increased by 4 percent of the number of shares of Stock issued and outstanding on the immediately preceding December 31. Under the 2021 Plan, 7,213,730 shares remained available for issuance at March 31, 2023. Options and restricted stock awards generally vest based on the grantee’s continued service with the Company during a specified period following a grant as determined by the Board of Directors and expire ten years from the grant date. In general, awards typically vest in three to four years , but vesting conditions can vary based on the discretion of the Company’s Board of Directors. The fair value of the options is estimated at the grant date using Black-Scholes and recognized over the vesting period, taking into account the terms and conditions upon which options are granted. The fair value of restricted stock awards is the fair value at the date of grant reduced by the exercise price of the award, if any. The fair value of both options and restricted stock awards are amortized on a straight-line basis over the requisite service period of the awards. Stock-based compensation expense is summarized for employees and nonemployees, by category in the accompanying condensed consolidated statements of operations as follows (in thousands): For the three months ended March 31, 2023 2022 Research and development $ 334 $ 5,065 Selling, general and administrative 1,757 8,924 Total $ 2,091 $ 13,989 Stock Option Activity The following table summarizes the Company’s stock option activity during the three months ended March 31, 2023: Number of Weighted- Weighted- Aggregate Outstanding at December 31, 2022 12,798,479 $ 3.97 5.80 $ 25 Granted — Exercised — Forfeited - unvested ( 94,673 ) $ 3.87 Forfeited - vested — Expired ( 428,647 ) $ 4.06 Outstanding at March 31, 2023 12,275,159 $ 3.97 5.47 $ — Exercisable at March 31, 2023 10,021,559 $ 3.91 4.77 $ — Vested and Expected to Vest at March 31, 2023 12,275,159 $ 3.96 5.47 $ — The aggregate intrinsic value of stock options is calculated as the difference between the exercise price of the stock options and the fair value of the common stock. The total fair value of options vested during the three months ended March 31, 2023 was $ 1.9 million. At March 31, 2023 , there was $ 5.3 million unrecognized compensation cost related to unvested stock option grants under the 2021 Plan, which was expected to be recognized over a weighted-average period of 2.0 years. Restricted Stock Unit (“RSU”) Activity The following table summarizes the Company’s RSU activity during the three months ended March 31, 2022: Number of RSUs Weighted- Outstanding and Unvested at December 31, 2022 4,083,070 $ 4.31 Granted — Vested ( 7,566 ) $ 8.26 Forfeited ( 254,982 ) $ 3.33 Outstanding at March 31, 2023 3,820,522 $ 4.36 Each RSU entitles the holder to one share of common stock on vesting and the RSU awards are based on a cliff vesting schedule over requisite service periods in which the Company recognizes compensation expense for the RSUs. Vesting of the RSUs is subject to the satisfaction of certain service and or certain performance conditions. The Company recognizes the estimated grant date fair value of these awards as stock-based compensation expense over the service and or performance periods based upon its determination of whether it is probable that the service and or performance conditions will be achieved. The Company assesses the probability of achieving the service and our performance conditions at each reporting period. Cumulative adjustments, if any, are recorded to reflect subsequent changes in the estimated or actual outcome of service and or performance-related conditions. At March 31, 2023 , unrecognized compensation cost for RSU awards granted totaled $ 6.4 million, which was expected to be recognized over a weighted-average period of 2.9 years. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 16. Income Taxes The Company recorded a provision of $ 0.0 million during the three months ended March 31, 2023 and March 31, 2022 , respectively. The provision recorded differs from the US statutory rate of 21 % for the three months ended March 31, 2023 and March 31, 2022 primarily due to the valuation allowance recorded against the net operating losses and deferred tax assets. The Company continues to evaluate the positive and negative evidence bearing upon the realizability of its net deferred tax assets and determined that it is not more likely than not that the Company will recognize the benefits of the net deferred tax assets. Therefore, a full valuation allowance has been recorded against the balance of net deferred tax assets in the United States as of three months ended March 31, 2023 . |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | 17. Earnings (Loss) per Share Basic and diluted loss per share attributable to common stockholders was calculated as follows: For the three months ended March 31, 2023 2022 Numerator: Net loss $ ( 5,146 ) $ ( 5,703 ) Accretion of redeemable convertible preferred stock to redemption value — ( 37,934 ) Accretion of noncontrolling interest put option to redemption value — ( 88 ) Income allocated to noncontrolling interest holder ( 100 ) — Net loss attributable to common stockholders $ ( 5,246 ) $ ( 43,725 ) Denominator: Weighted average common shares outstanding, basic and diluted 73,329,309 62,743,154 Net loss per share, basic and diluted $ ( 0.07 ) $ ( 0.70 ) The Company’s potential dilutive securities, which include stock options, RSUs, warrants and earnout shares have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share. Therefore, the weighted-average number of common stock outstanding used to calculate both basic and diluted net loss per share attributable to common stockholders is the same for all periods presented. The Company excluded the following potential common stock, presented based on amounts outstanding at March 31, 2023 and 2022 from the computation of diluted net loss per share attributable to common stockholders because including them would have had an anti-dilutive effect. March 31, 2023 2022 Options and RSUs to acquire common stock 16,881,549 16,881,549 Warrants on common stock 48,421,412 24,333,365 Earnout shares — — Total 65,302,961 41,214,914 Total potentially dilutive common share equivalents for the three months ended March 31, 2023 , excludes 23,482,845 shares related to the earnout liability as these shares are contingently issuable upon meeting certain triggering events. |
Commitment and Contingencies
Commitment and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 18. Commitments and Contingencies Operating Leases In June 2019 , the Company entered into an operating lease agreement with PureTech Health LLC, or PureTech, for office space located in Boston, Massachusetts. The lease expires in August 2025 , with total lease payments of $ 3.2 million over the term. The Company also has operating leases for certain storage and equipment with various terms expiring in 2027 . The remaining weighted average noncancelable term of the Company’s operating leases was 2.5 years at March 31, 2023 , and the weighted average discount rate was 5.2 %. The following table summarizes the Company's operating lease activity (in thousands): For the three months ended March 31, 2023 2022 Lease liabilities, current 587 548 Lease liabilities, non-current 835 1,374 Total operating lease liabilities $ 1,422 1,922 Operating lease rental expense $ 184 $ 131 Future maturities of the lease liability under the Company’s noncancelable operating leases at March 31, 2023 are as follows (in thousands): Remaining 2023 maturities 504 2024 583 2025 391 2026 38 2027 18 More than 5 years - Total undiscounted lease maturities $ 1,534 Imputed interest ( 112 ) Total lease liability $ 1,422 Royalty Agreements Expenses from royalty agreements on net product sales and sublicense income is recognized as a cost of goods sold in the accompanying condensed consolidated statements of operations during the period in which the associated revenues are recognized. PureTech In December 2009, the Company entered into a royalty and sublicense income agreement with PureTech, a significant stockholder in the Company, whereby the Company is required to pay PureTech a 2.0 % royalty on net product sales received as a result of developing products and technology using the intellectual property purchased from One. One S.r.l Under the amended and restated master agreement with One, the Company is required to pay a 2.0 % royalty on net product sales and an aggregate of € 17.5 million (approximately $ 19.0 million at March 31, 2023) upon the achievement of certain commercial milestones of new medical indications as well as Plenity and pay royalties on net product sales and/or a percentage of sublicense income. At March 31, 2023, none of the milestones have been met. Grant Agreements The Company has been awarded grants from governmental agencies, which are recognized as income as the qualifying expenses are incurred (see Note 11). The grant agreements contain certain provisions, including, among others, maintaining a physical presence in the region for defined periods. Failure to comply with these covenants would require either a full or partial refund of the grant to the granting authority. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 19. Related Party Transactions The Company had the following transactions with related parties: PureTech In June 2019, PureTech executed a sublease agreement with the Company (see Note 18). With respect to the sublease, the Company incurred lease expense of less than $ 0.1 million and approximately $ 0.1 million during the three months ended March 31, 2023 and 2022, respectively, recorded in general and administrative expenses in the accompanying condensed consolidated statements of operations. The Company incurred royalty expense of $ 0.1 million and $ 0.2 million in connection with the PureTech royalty agreement (see Note 18) during the three months ended March 31, 2023 and 2022 , respectively, recorded in cost of goods sold in the accompanying condensed consolidated statements of operations. The Company had an accounts payable balance to PureTech of $ 0.4 million and $ 0.1 million at March 31, 2023 and December 31, 2022, respectively, in the accompanying condensed consolidated balance sheets. On July 25, 2022, the Company issued a convertible promissory note to PureTech in the principal amount of $ 15.0 million (see Note 11). At March 31, 2023 and December 31, 2022 , the outstanding balance was $ 13.6 million and $ 16.6 million, respectively, recorded at fair value in the accompanying condensed consolidated balance sheets. During the three months ended March 31, 2023 , the Company recognized a gain of $ 2.9 million with respect to the change in fair value of the convertible promissory notes on the accompanying condensed consolidated statements of operations. On February 21, 2023, the Company entered into the February 2023 NPA with gross proceeds of $ 5.0 million (see Note 11) , pursuant to which the Company issued a short-term convertible senior secured note in the aggregate principal amount of $ 5.0 million and warrants to purchase 23,688,047 shares of Common Stock. The warrants have an exercise price of $ 0.2744 and may not be exercised prior to the receipt of stockholders' approval. At March 31, 2023 , the outstanding balance of the convertible senior secured note was $ 3.4 million, recorded at fair value in the accompanying condensed consolidated balance sheets. During the three months ended March 31, 2023 , the Company recognized a loss of $ 0.1 million with respect to the change in fair value of the convertible senior secured note on the accompanying condensed consolidated statements of operations. SSD2 On July 25, 2022, the Company issued a convertible promissory note to SSD2, LLC in the principal amount of $ 5.0 million (see Note 11). At March 31, 2023 and December 31, 2022 , the outstanding balance was $ 4.5 million and $ 5.5 million, respectively, recorded at fair value in the accompanying condensed consolidated balance sheets. During the three months ended March 31, 2023 , the Company recognized a gain of $ 1.0 million with respect to the change in fair value of the convertible promissory notes on the accompanying condensed consolidated statements of operations. One S.r.l Consulting Agreement with Founder of One The Company and one of the founders of One, who is also a stockholder of the Company, entered into a consulting agreement for the development of the Company's science and technology. The Company incurred costs for consulting services received from the founder of One totaling less than $ 0.1 million during each of the three months ended March 31, 2023 and 2022 , respectively, recorded in research and development expense in the accompanying condensed consolidated statements of operations. The Company recorded an accounts payable balance to the founder of less than $ 0.1 million at both March 31, 2023 and December 31, 2022, respectively, in the accompanying condensed consolidated balance sheets. Acquisition of One In connection with the amended and restated master agreement with One (see Note 10), the Company acquired a 10.0 % equity interest in One in exchange for cash consideration. The Company had remaining undiscounted payments of € 2.5 million due to One at March 31, 2023 and December 31, 2022 (approximately $ 2.7 million due to One at March 31, 2023 and December 31, 2022), respectively. The balance at March 31, 2023 was recorded in accrued expenses in the accompanying condensed consolidated balance sheets as it is expected to be settled within the next twelve months. Additionally, the Company incurred royalty expense of less than $ 0.1 million and approximately $ 0.1 million with One (see Note 18) during the three months ended March 31, 2023 and 2022 , respectively, recorded in cost of goods sold in the accompanying condensed consolidated statements of operations. The Company had an accrued expense balance of $ 0.1 million at March 31, 2023 and an accrued expense balance of less than $ 0.1 million at December 31, 2022, respectively, related to royalties in the accompanying condensed consolidated balance sheets. RIF Transaction In connection with the RIF transaction entered into in August 2020, the Company received $ 12.3 million from RIF as an equity investment that can be called by the Company beginning in December 2023 and ending in December 2026 by paying the investment plus 15.0 % percent annual interest or put by RIF starting in January 2027 and ending in December 2027 for the investment amount plus 3.175 % percent annual interest. RIF holds approximately 20 % of the equity of Gelesis S.r.l. at December 31, 2021 (see Note 10). In addition, the shareholders of RIF provided the Company with a loan for $ 16.3 million with a fixed interest rate of 6.35 % per annum (see Note 11). |
Subsequent Event(s)
Subsequent Event(s) | 3 Months Ended |
Mar. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Event(s) | 20. Subsequent Event(s) On April 2, 2023, the Company received a non-binding indication of interest from PureTech to acquire all of the outstanding capital stock of the Company for $ 0.21 per share, payable in shares of PureTech. The terms of any potential agreement between the Company and PureTech would be contingent upon certain condition s, including approval by PureTech’s board of directors and a special committee of the Company’s board of directors and negotiation of definitive transaction documents. The indication of interest also contains a non-binding offer to provide up to an additional $ 5.0 million of convertible senior secured note financing to fund day-to-day operations of the Company, the terms of which are to be negotiated and determined. The Company is currently evaluating this PureTech offer as well as various strategic alternatives in consultation with its financial and legal advisors. On April 10, 2023, the NYSE Regulation reached its decision to delist the Company's common stock because the Comp any had fallen below the NYSE's continued listing standard requiring listed companies to maintain an average global market capitalization over a consecutive 30 trading day period of at least $ 15.0 million. The Company did not appeal the delisting determination. As of April 10, 2023, the NYSE Regulation reached a decision to delist the Company’s common stock and subsequently the Company’s commons stock was delisted from NYSE on April 26, 2023. Commencing April 11, 2023, the Company's stock is traded in the over-the-counter ("OTC") markets. The Company will continue to make all required filings with the SEC and remains subject to all SEC rules and regulations applicable to reporting companies under the Securities Exchange Act of 1934, as amended. On May 1, 2023, the Company and PureTech Health LLC, the Initial Investor, amended the Note and Warrant Purchase Agreement (the “Amendment”) dated February 21, 2023 (the “Original NPA”). Pursuant to this Amendment, for a cash purchase price of $ 2.0 million, the Initial Investor waived the certain conditions contained in the Original NPA and (i) the Notes Issuers issued to the Initial Investor Additional Notes in the aggregate principal amount of $ 2.0 million (the “First Issuance of Additional Notes”) and (ii) the Company issued to the Initial Investor additional warrants to purchase up to 192,307,692 shares of Common Stock, at an exercise price of $ 0.0182 (the “New Warrant”). Additionally, as a result of the delisting from the NYSE, the Initial Warrant was amended (the “Amended Warrant”) to provide that the exercise thereof is no longer subject to the approval of the Company’s stockholders, and the conversion of the Notes issued pursuant to the Original NPA, are no longer subject to the approval of the Company’s stockholders. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The unaudited interim condensed consolidated financial statements of the Company included herein have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") as found in the Accounting Standards Codification ("ASC"), Accounting Standards Update ("ASU") of the Financial Accounting Standards Board ("FASB") and the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations. Accordingly, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements as of and for the year ended December 31, 2022 and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 28, 2023. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited financial statements, and updated, as necessary, in this report. In the opinion of the Company's management, the accompanying unaudited interim condensed consolidated financial statements contain all adjustments that are necessary to present fairly the Company's financial position as of March 31, 2023, the results of its operations, non-controlling interest, redeemable convertible preferred stock and stockholders' deficit and cash flows for the three months ended March 31, 2023 and 2022. Such adjustments are of a normal and recurring nature. The results for the three months ended March 31, 2023 are not necessarily indicative of the results for the year ending December 31, 2023 or for any future period. The Company’s condensed consolidated financial statements include the accounts of the Company, its two wholly-owned subsidiaries and a variable interest entity (“VIE”), Gelesis S.r.l., in which the Company has a controlling interest and is the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. |
Reclassification of Prior Year Presentation | Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations or financial position. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of income and expenses during the reporting period. The Company assesses the above estimates on an ongoing basis; however, actual results could materially differ from those estimates. |
Subsequent Event(s) | Subsequent Event(s) The Company considers events or transactions that occur after the balance sheet date but before the condensed consolidated financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. The Company evaluated all events and transactions through the date these condensed consolidated financial statements were filed with the Securities and Exchange Commission (“SEC”) or were available to be issued. |
Business Combinations | Business Combination The Company accounts for its business combinations using the acquisition method of accounting. The purchase price is attributed to the fair value of the assets acquired and liabilities assumed. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are measured separately at their fair values as of the acquisition date. The excess of the purchase price of acquisition over the fair value of the identifiable net assets of the acquiree is recorded as goodwill. The results of businesses acquired in a business combination are included in the Company's consolidated financial statements from the date of acquisition. As discussed in Note 1, on January 13, 2022, the Company consummated the Business Combination pursuant to the Business Combination Agreement with CPSR dated July 19, 2021, as amended on November 8, 2021 and December 30, 2021 . The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, CPSR, who was the legal acquirer, was treated as the acquired company for financial reporting purposes. Accordingly, the Business Combination was treated as the equivalent of Gelesis issuing stock for the net assets of CPSR, accompanied by a recapitalization. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The guidance in FASB ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), defines fair value and establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Level 1 – Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 – Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, the Company’s own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. The Company uses prices and inputs that are current as of the measurement date, including during periods of market dislocation. In periods of market dislocation, the observability of prices and inputs may be reduced for many instruments. This condition could cause an instrument to be reclassified from Level 1 to Level 2 or Level 2 to Level 3. The Company’s earnout liability, private placement warrants, interest rate swaps, call option liability, and convertible promissory notes are recorded at fair value on a recurring basis. The carrying amount of accounts receivable, grants receivable, accounts payable and accrued expenses are considered a reasonable estimate of their fair value, due to the short-term maturity of these instruments. The carrying amount of notes payable is also considered to be a reasonable estimate of the fair value based on the nature of the debt and that the debt bears interest at the prevailing market rate for instruments with similar characteristics. The Company’s cash equivalents and marketable securities are carried at fair value, determined according to the fair value hierarchy described above. Earnout Liability: In connection with the Business Combination, Legacy Gelesis equity holders received the right to receive additional common stock upon the achievement of certain earnout targets. As the earnout consideration contains a settlement provision that precludes it from being indexed to the Company’s stock, it is classified as a liability held at fair value in accordance ASC 815 and the instrument is adjusted to fair value at each reporting period. In determining the fair value of the earnout liability at inception and on a recurring basis, the Company utilizes the Monte Carlo simulation value model where the fair value of the earnout is the present value of a distribution of potential outcomes on a daily basis over the term of the earnout period. Private Placement Warrant Liability: The Private Placement Warrants are recognized as liabilities in accordance with ASC 815. Accordingly, the Company recognizes the warrant instruments as liabilities held at fair value and adjusts the instruments to fair value at each reporting period. In determining the fair value of the Private Placement Warrant liability, the Company utilized a modified Monte Carlo simulation value model at inception and on a recurring basis. One Srl Call Option: In connection with the October 2020 amended agreement with One Srl, the Company granted One a contingent call option to buy back the 10 % ownership that the Company acquired in the 2019 One Amendment. The One Srl call option was recorded as a liability held at fair value at the date of issuance and is remeasured at each subsequent reporting date with changes in fair value recorded in other income (expense) in the accompanying condensed consolidated statements of operations. Fair value is determined using a Black-Scholes option pricing model. Convertible promissory notes: The convertible promissory notes issued in conjunction with the Company’s bridge financing arrangements from time to time were recognized at fair value at issuance and subsequent changes in fair value were recorded in the accompanying consolidated statements of operations (see Note 12). Fair value of the promissory notes is determined using a multiple scenario-based valuation method. The fair value of the hybrid instrument was determined by calculating the value of the instrument in each scenario “with” the respective conversion feature and “without”. The significant inputs used in estimating the fair value of the convertible promissory notes include the estimated discount rate, expected term, and the outcome probability with respect to each scenario. |
Revenue Recognition | Revenue Recognition Product Revenue The Company commercializes Plenity in the U.S. markets principally through synergistic partnerships with online pharmacies and telehealth providers, which in turn sell Plenity directly to patients based on prescriptions. Outside the U.S., the Company primarily seeks collaborations with strategic partners to market Plenity and obtain necessary regulatory approvals as necessary. Product revenue is recognized by the Company in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services when the customer obtains control of the product, which occurs at a point in time, when the product is received by the Company's customers. Reserves for Variable Consideration Revenues from product sales are recorded as product revenue at the net sales price (transaction price), which includes estimates of variable consideration that are reimbursable to customers for which reserves are established and which result from (a) shipping charges to end-users, (b) pharmacy dispensing and platform fees, (c) merchant and processing fees, (d) promotional discounts offered by the Company to end-users, and (e) reserves for expected product quality returns. These reserves for contractual adjustments are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the customer) or a current liability (if the amount is payable to a party other than the customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as the Company's historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company's best estimates of the amount of consideration to which the Company is entitled based on the terms of the contract(s). The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company's estimates. If actual results in the future vary from the Company's estimates, the Company will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known. The Company has no plan to seek government or commercial payor reimbursements in the US or the overseas markets. Therefore, reserves for variable consideration do not contain any components related to government and payor rebates or chargebacks. Product Returns The Company generally does not accept customer returns, except for product quality related cases. The Company evaluates quality related returns and adjusts the corresponding product warranty reserves and liabilities at least quarterly and at the end of each reporting period. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for all stock-based compensation awards granted to employees and non-employees in accordance with ASC 718, Compensation – Stock Compensation . The Company’s stock-based compensation consists primarily of stock options. The measurement date for share-based awards is the date of grant, and stock-based compensation costs are recognized as expense over the respective requisite service periods, which are typically the vesting period. The fair value of each stock option grant is estimated as of the date of grant using the Black-Scholes option-pricing model that requires management to apply judgment and make estimates, including: • exercise price: The exercise price is the fair market value on grant date, which shall mean the closing sale price of common stock, as reported on such market on that date (or if there are no market quotations for such date, the determination shall be made by reference to the last date preceding such date for which there are market quotations); • expected volatility: As the Company was previously a privately-owned company, there is not sufficient historical volatility for the expected term of the options. Therefore, the Company used an average historical share price volatility based on an analysis of reported data for a peer group of comparable companies for which historical information is available. For these analyses, the Company selects companies with comparable characteristics to itself including enterprise value, risk profiles, position within the industry, 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 intends to consistently apply this process using representative companies until a sufficient amount of historical information regarding the volatility of its own share price becomes available; • risk-free interest rate, which is based on the U.S. Treasury yield curve in effect at the time of grant commensurate with the expected term assumption; • expected term, which is calculated using the simplified method, as prescribed by the Securities and Exchange Commission Staff Accounting Bulletin No. 107, Share-Based Payment, as the Company has insufficient historical information regarding its stock options to provide a basis for an estimate. Under this approach, the weighted-average expected life is presumed to be the average of the contractual term of ten years and the weighted-average vesting term of the stock options, taking into consideration multiple vesting tranches; • dividend yield, which is zero based on the fact that the Company never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. The measurement date for non-employee awards is the date of grant without changes in the fair value of the award. Stock-based compensation costs for non-employees are recognized as expense over the vesting period. Stock-based compensation expense is classified in the condensed consolidated statements of operations based on the function to which the related services are provided. Forfeitures are recorded as they occur. |
Recently Issued Pronouncements | Recently Issued Pronouncements In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842): Common Control Arrangements. This update requires leasehold improvements associated with common control leases be amortized by the lessee over the useful life of the leasehold improvements to the common control group (regardless of the lease term) as long as the lessee controls the use of the underlying asset (the leased asset) through a lease. However, if the lessor obtained the right to control the use of the underlying asset through a lease with another entity not within the same common control group, the amortization period may not exceed the amortization period of the common control group. Further, leasehold improvements associated with common control leases be accounted for as a transfer between entities under common control through an adjustment to equity if, and when, the lessee no longer controls the use of the underlying asset. Those leasehold improvements are subject to the impairment guidance in Topic 360, Property, Plant, and Equipment . This update is effective for annual periods beginning after December 15, 2023, and early application is permitted. This guidance should be applied either (i) prospectively to all new leasehold improvements recognized on or after the date of initial application; (ii) prospectively to all new and existing leasehold improvements recognized on or after the date of initial application, with any remaining unamortized balance of existing leasehold improvements amortized over their remaining useful life to the common control group determined at that date; or (iii) retrospectively to the beginning of the period in which the entity first applied Topic 842 , with any leasehold improvements that otherwise would not have been amortized or impaired recognized through a cumulative-effect adjustment to the opening balance of retained earnings at the beginning of the earliest period presented in accordance with Topic 842 . The Company is evaluating the potential impact of this update and does not intend to early adopt this update for fiscal year 2023. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis consisted of the following at March 31, 2023 (in thousands): Fair Value Measurements Fair Value Quoted Prices Significant Significant Asset: Interest rate swap contract (see Note 11) $ 747 $ — $ 747 $ — Liabilities: Convertible promissory notes (see Note 11) 25,985 — — 25,985 One S.r.l. call option (see Note 10) 141 — — 141 Total liabilities measured at fair value $ 26,126 $ — $ — $ 26,126 Assets and liabilities measured at fair value on a recurring basis consisted of the following at December 31, 2022 (in thousands): Fair Value Measurements Fair Value Quoted Prices Significant Significant Asset: Interest rate swap contract (see Note 11) $ 800 $ — $ 800 $ — Liabilities: Convertible promissory notes (see Note 11) 27,403 — — 27,403 Earnout liability (see Note 13) 563 — — 563 Private placement warrant liability (see Note 12) 130 — — 130 One S.r.l. call option (see Note 10) 674 — — 674 Total liabilities measured at fair value $ 28,770 $ — $ — $ 28,770 |
Summary of Changes in Fair Value of Company's Level 3 Financial Instruments | The following table presents a summary of the changes in the fair value of the Company’s Level 3 financial instruments during the three months ended March 31, 2023: Convertible Promissory Notes One S.r.l. Call Option Earnout Liability Private Placement Warrant Liability Balance at December 31, 2022 $ 27,403 $ 674 $ 563 $ 130 Issuance of convertible promissory notes 5,000 — — — Transaction price allocated to warrant issuance ( 1,459 ) — — — Changes in fair value ( 4,959 ) ( 536 ) ( 563 ) ( 130 ) Foreign currency translation adjustment — 3 — — Settlement — — — Balance at March 31, 2023 $ 25,985 $ 141 $ — $ — |
Product Revenue Reserve and A_2
Product Revenue Reserve and Allowance (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Revenue | Revenue for t he three months ended March 31, 2023 and March 31, 2022 consisted of the following (in thousands): For the three months ended March 31, 2023 2022 Roman Health Pharmacy LLC $ 1,015 $ 6,499 GoGoMeds 661 1,015 CMS 77 — Total $ 1,753 $ 7,514 |
Summary of Activity in Product Revenue Reserve and Allowance | Reserves and Allowances The following table summarizes the activity in the product revenue reserve and allowances during the three months ended March 31, 2023 and March 31, 2022 (in thousands): 2023 2022 Balance at January 1, $ 23 $ 82 Provision related to product sales 210 574 Credits and payments made ( 226 ) ( 418 ) Balance at March 31, $ 7 $ 238 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consisted of the following (in thousands): March 31, December 31, 2023 2022 Raw materials $ 9,394 $ 9,549 Work in process 4,361 4,695 Finished goods 5,303 5,955 Inventories, gross 19,058 20,199 Less: inventory reserves ( 13,117 ) ( 13,334 ) Total inventories $ 5,941 $ 6,865 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following (in thousands): March 31, December 31, 2023 2022 Prepaid expenses $ 277 $ 314 Prepaid insurance 1,844 268 Prepaid contract research costs 145 189 Research and development tax credit 588 567 Value added tax receivable 2,102 2,036 Income tax receivable 207 203 Investment tax credit 1,488 1,050 Prepaid expenses and other current assets $ 6,651 $ 4,627 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, Net | Property and equipment, net, consists of the following (in thousands): March 31, December 31, 2023 2022 Laboratory and manufacturing equipment $ 41,303 $ 29,944 Land and buildings 8,556 10,673 Leasehold improvements 1,552 1,525 Computer equipment and software 824 811 Capitalized software 232 232 Construction in process 15,649 24,287 Property and equipment – at cost 68,116 62,907 Less accumulated depreciation ( 9,762 ) ( 8,137 ) Property and equipment – net $ 58,354 $ 59,335 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses and other current liabilities consist of the following (in thousands): March 31, December 31, 2023 2022 Accrued payroll and related benefits $ 1,656 $ 1,550 Accrued professional fees and outside contractors (including 35 and $ 153 , respectively) 857 3,521 Accrued property, plant and equipment additions 180 378 Accrued inventory and manufacturing expense 347 1,020 Unpaid portion of One S.r.l. equity acquisition (see Note 10) 2,754 2,656 Tax payables 578 543 Deferred legal fees 738 738 Accrued interest 370 62 Total accrued expenses $ 7,480 $ 10,468 |
Other Long-Term Liabilities (Ta
Other Long-Term Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Other Liabilities Disclosure [Abstract] | |
Other Long-Term Liabilities | Other long-term liabilities consist of the following (in thousands): March 31, December 31, 2023 2022 Long-term tax liabilities $ 141 $ 224 One S.r.l. call option (see Note 10) 141 674 Total other long-term liabilities $ 282 $ 898 |
Significant Agreements (Tables)
Significant Agreements (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Significant Agreements [Abstract] | |
Summary of Grant Recognized | The following table represents amounts recognized on the consolidated statements of operations for the three months ended March 31, 2023 and March 31, 2022 in relation to the Puglia 1 Grant and Puglia 2 Grant (in thousands): For the three months ended March 31, 2023 2022 PIA 1 Grant income $ 194 $ 212 Income attributable to R&D expense 18 — Income attributable to investments in facilities and equipment 176 212 PIA 2 Grant Income $ 337 $ 195 Income attributable to R&D expense 232 195 Income attributable to investments in facilities and equipment 105 — The following table represents amounts recorded on the consolidated balance sheets at March 31, 2023 and December 31, 2022 in relation to the Puglia 1 Grant and Puglia 2 Grant (in thousands): March 31, December 31, 2023 2022 PIA 1 Grant Grant receivable 3,290 3,237 Deferred income 4,886 5,001 Current portion of deferred income 780 771 PIA 2 Grant Grant receivable 5,168 122 Long-term grant receivable — 4,732 Deferred income 3,452 3,502 Current portion of deferred income 427 420 |
Summary of Changes in Fair Value of Call Option Liability | The following represents a summary of the changes to Company’s One Srl call option liability during the three months ended March 31, 2023 and March 31, 2022 (in thousands): For the Three Months Ended March 31, 2023 2022 Balance at Beginning of Period $ 674 $ 2,416 Change in fair value ( 536 ) 258 Foreign currency translation gain 3 ( 51 ) Balance at the End of Period $ 141 $ 2,623 |
Weighted Average Assumptions Used to Determine Fair Value of Call Option Liability | The following weighted average assumptions were used to determine the fair value of the One Srl call option liability at March 31, 2023 and December 31, 2022: March 31, December 31, 2023 2022 Expected term 0.5 years 4.0 years Expected volatility 150.0 % 86.0 % Expected dividend yield 0.0 % 0.0 % Risk free interest rate 4.9 % 4.2 % Estimated fair value of ownership interest $ 1,622 $ 1,772 Exercise price of call option $ 6,527 $ 6,422 |
Summary of Noncontrolling Interest | The Company recorded the following noncontrolling interest components in the condensed consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholders' deficit (in thousands): For the three months ended March 31, 2023 2022 Balance at Beginning of Period $ 12,590 $ 11,855 Accretion of put option — 88 Income allocated to noncontrolling interest holder 100 — Foreign currency translation adjustment 206 ( 239 ) Balance at the End of Period $ 12,896 $ 11,704 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Summary of Non-Convertible Debt Outstanding | The Company’s non-convertible debt outstanding at March 31, 2023 and December 31, 2022 is summarized as follows: March 31, December 31, 2023 2022 Italian Economic Development Agency Loan 168 331 Intesa Sanpaolo Loan 1 6,970 7,094 Intesa Sanpaolo Loan 2 5,439 5,352 Horizon 2020 Loan 395 389 RIF Shareholders Loan 16,317 16,055 UniCredit Loan 4,493 4,421 Total debt obligation $ 33,782 $ 33,642 Unamortized loan discount and issuance costs ( 323 ) ( 346 ) Total debt obligation carrying amount $ 33,459 $ 33,296 Current portion $ 7,422 $ 7,954 Long-term portion $ 26,037 $ 25,342 |
Summary of Future Maturities to Debt Outstanding | Future maturities with respect to non-convertible debt outstanding at March 31, 2023 are as follows (in thousands): At March 31, 2023 2023 7,825 2024 5,534 2025 4,027 2026 4,047 2027 4,029 More than 5 years 8,320 Total maturities $ 33,782 |
Summary of Assumptions Used to Determine Fair Value of Debt | The following assumptions were used to determine the fair value of the 2022 promissory notes at March 31, 2023 and December 31, 2022: March 31, 2023 December 31, 2022 Expected term 9 months 1 year Weighted average discount rate 26.0 % 26.0 % Probability of repayment after qualified financing — 50.0 % Probability of holder electing conversion option 10.0 % 50.0 % Probability of a business combination 60.0 % — Probability of Company default 30.0 % — The following assumptions were used to determine the fair value of the Senior Secured Note at March 31, 2023 and the original issuance date of February 21, 2023: March 31, 2023 February 21, 2023 Expected term 0.3 year 0.4 year Weighted average discount rate 26.9 % 26.9 % Probability of repayment after qualified financing — — Probability of holder electing conversion upon a business combination 60.0 % 50.0 % Probability of Company default 30.0 % 40.0 % Probability of holder electing conversion option upon other default events 10.0 % 10.0 % |
Summary of Fair Value of Warrants Based on Black-Scholes Inputs | The Company determined that the allocated fair value of the warrants and the related deferred financing costs were $ 1.5 million and $ 0.2 million, respectively, based on the following Black-Scholes inputs as of February 21, 2023: Market price of common stock $ 0.28 Expected volatility 160 % Expected term (in years) 0.24 Risk-free interest rate 4.9 % Expected dividend yield — |
Warrants Liabilities (Tables)
Warrants Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Class of Warrant or Right [Line Items] | |
Summary of Changes in Warrant Liabilities Activity | The following represents a summary of the warrant liabilities activity during the three months ended March 31, 2023: Private Placement Warrants Balance at December 31, 2022 $ 130 Changes in fair value ( 130 ) Balance at March 31, 2023 $ — |
Summary of Weighted Average Assumptions of Fair Value of Liabilities | Assets and liabilities measured at fair value on a recurring basis consisted of the following at March 31, 2023 (in thousands): Fair Value Measurements Fair Value Quoted Prices Significant Significant Asset: Interest rate swap contract (see Note 11) $ 747 $ — $ 747 $ — Liabilities: Convertible promissory notes (see Note 11) 25,985 — — 25,985 One S.r.l. call option (see Note 10) 141 — — 141 Total liabilities measured at fair value $ 26,126 $ — $ — $ 26,126 Assets and liabilities measured at fair value on a recurring basis consisted of the following at December 31, 2022 (in thousands): Fair Value Measurements Fair Value Quoted Prices Significant Significant Asset: Interest rate swap contract (see Note 11) $ 800 $ — $ 800 $ — Liabilities: Convertible promissory notes (see Note 11) 27,403 — — 27,403 Earnout liability (see Note 13) 563 — — 563 Private placement warrant liability (see Note 12) 130 — — 130 One S.r.l. call option (see Note 10) 674 — — 674 Total liabilities measured at fair value $ 28,770 $ — $ — $ 28,770 |
Private Placement Warrants | |
Class of Warrant or Right [Line Items] | |
Summary of Weighted Average Assumptions of Fair Value of Liabilities | The following weighted-average assumptions were used to determine the fair value of the Private Placement Warrant liability at December 31, 2022: Private Placement Warrants Expected term 4.0 years Expected volatility 86.0 % Expected dividend yield 0.0 % Risk free interest rate 4.0 % Price of Gelesis Common Stock $ 0.29 Exercise price of warrants $ 11.50 |
Earnout Liability (Tables)
Earnout Liability (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instrument Detail [Abstract] | |
Summary of Earnout Liability Activity | The following represents a summary of the earnout liability activity during the three months ended March 31, 2023: Earnout Liability Balance at December 31, 2022 $ 563 Changes in fair value ( 563 ) Balance at March 31, 2023 $ — |
Summary of Weighted Average Assumptions Used to Determine Fair Value of Earnout Liability | The following weighted-average assumptions were used to determine the fair value of the earnout liability at December 31, 2022: December 31, 2022 Expected term 4.0 years Expected volatility 86.0 % Expected dividend yield 0.0 % Risk free interest rate 4.0 % Price of Gelesis Common Stock $ 0.29 |
Stockholder's Equity (Deficit)
Stockholder's Equity (Deficit) (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Common Stock Reserved for Future Issuance | At March 31, 2023 and December 31, 2022 common stock reserved for future issuances was as follows: March 31, December 31, 2023 2022 Common stock issued upon option exercise and RSUs vesting 16,881,549 16,881,549 Conversion of all classes of redeemable convertible — — Issuances upon exercise of common stock warrants 48,421,412 24,733,365 Earnout shares 23,482,845 23,482,845 Total common stock reserved for future issuance 88,785,806 65,097,759 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Stock-Based Compensation Expense | Stock-based compensation expense is summarized for employees and nonemployees, by category in the accompanying condensed consolidated statements of operations as follows (in thousands): For the three months ended March 31, 2023 2022 Research and development $ 334 $ 5,065 Selling, general and administrative 1,757 8,924 Total $ 2,091 $ 13,989 |
Summary of Stock Option Activity | The following table summarizes the Company’s stock option activity during the three months ended March 31, 2023: Number of Weighted- Weighted- Aggregate Outstanding at December 31, 2022 12,798,479 $ 3.97 5.80 $ 25 Granted — Exercised — Forfeited - unvested ( 94,673 ) $ 3.87 Forfeited - vested — Expired ( 428,647 ) $ 4.06 Outstanding at March 31, 2023 12,275,159 $ 3.97 5.47 $ — Exercisable at March 31, 2023 10,021,559 $ 3.91 4.77 $ — Vested and Expected to Vest at March 31, 2023 12,275,159 $ 3.96 5.47 $ — |
Summary of Restricted Stock Unit Activity | The following table summarizes the Company’s RSU activity during the three months ended March 31, 2022: Number of RSUs Weighted- Outstanding and Unvested at December 31, 2022 4,083,070 $ 4.31 Granted — Vested ( 7,566 ) $ 8.26 Forfeited ( 254,982 ) $ 3.33 Outstanding at March 31, 2023 3,820,522 $ 4.36 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Summary of Basic and Diluted Net Loss Per Share | Basic and diluted loss per share attributable to common stockholders was calculated as follows: For the three months ended March 31, 2023 2022 Numerator: Net loss $ ( 5,146 ) $ ( 5,703 ) Accretion of redeemable convertible preferred stock to redemption value — ( 37,934 ) Accretion of noncontrolling interest put option to redemption value — ( 88 ) Income allocated to noncontrolling interest holder ( 100 ) — Net loss attributable to common stockholders $ ( 5,246 ) $ ( 43,725 ) Denominator: Weighted average common shares outstanding, basic and diluted 73,329,309 62,743,154 Net loss per share, basic and diluted $ ( 0.07 ) $ ( 0.70 ) |
Schedule of Anti-dilutive Securities Excluded from Computation of Net Loss Per Share | The Company excluded the following potential common stock, presented based on amounts outstanding at March 31, 2023 and 2022 from the computation of diluted net loss per share attributable to common stockholders because including them would have had an anti-dilutive effect. March 31, 2023 2022 Options and RSUs to acquire common stock 16,881,549 16,881,549 Warrants on common stock 48,421,412 24,333,365 Earnout shares — — Total 65,302,961 41,214,914 |
Commitment and Contingencies (T
Commitment and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Operating Lease Activity | The following table summarizes the Company's operating lease activity (in thousands): For the three months ended March 31, 2023 2022 Lease liabilities, current 587 548 Lease liabilities, non-current 835 1,374 Total operating lease liabilities $ 1,422 1,922 Operating lease rental expense $ 184 $ 131 |
Schedule of Future Maturities of the Lease Liability Under the Company's Noncancelable Operating Leases | Future maturities of the lease liability under the Company’s noncancelable operating leases at March 31, 2023 are as follows (in thousands): Remaining 2023 maturities 504 2024 583 2025 391 2026 38 2027 18 More than 5 years - Total undiscounted lease maturities $ 1,534 Imputed interest ( 112 ) Total lease liability $ 1,422 |
Nature of the Business and Ba_2
Nature of the Business and Basis of Presentation - Additional Information (Details) - Gelesis $ in Millions | Jan. 13, 2022 USD ($) |
Subsidiary Sale Of Stock [Line Items] | |
Gross proceeds from business combinations | $ 105 |
Net proceeds from business combinations | $ 70.5 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) - One Srl | Mar. 31, 2023 | Jun. 30, 2019 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Equity Method Investment, Ownership Percentage | 10% | |
Call Option | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Equity Method Investment, Ownership Percentage | 10% |
Business Combination and Revers
Business Combination and Reverse Recapitalization - Additional Information (Details) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
Business Acquisition [Line Items] | ||
Common stock, shares issued | 73,332,588 | 73,325,022 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common Stock | ||
Business Acquisition [Line Items] | ||
Common stock, shares issued | 73,332,588 | |
Common stock, par value | $ 0.0001 |
Business Combination and Reve_2
Business Combination and Reverse Recapitalization - Schedule of Consummation of Business Combination (Details) - shares | Mar. 31, 2023 | Dec. 31, 2022 |
Business Acquisition [Line Items] | ||
Total common stock immediately after Closing | 73,332,588 | 73,325,022 |
Common Stock | ||
Business Acquisition [Line Items] | ||
Total common stock immediately after Closing | 73,332,588 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Liabilities: | ||
Total liabilities measured at fair value | $ 26,126 | $ 28,770 |
Level 3 | ||
Liabilities: | ||
Total liabilities measured at fair value | 26,126 | 28,770 |
Interest rate swap contract | ||
Asset: | ||
Interest rate swap contract (see Note 11) | 747 | 800 |
Interest rate swap contract | Level 2 | ||
Asset: | ||
Interest rate swap contract (see Note 11) | 747 | 800 |
Convertible Promissory Notes | ||
Liabilities: | ||
Convertible promissory notes (see Note 11) | 25,985 | 27,403 |
Convertible Promissory Notes | Level 3 | ||
Liabilities: | ||
Convertible promissory notes (see Note 11) | 25,985 | 27,403 |
Earnout Liability | ||
Liabilities: | ||
Earnout liability (see Note 13) | 563 | |
Earnout Liability | Level 3 | ||
Liabilities: | ||
Earnout liability (see Note 13) | 563 | |
Private Placement Warrant Liability | ||
Liabilities: | ||
Warrant liability | 130 | |
Private Placement Warrant Liability | Level 3 | ||
Liabilities: | ||
Warrant liability | 130 | |
One Srl Call Option | ||
Liabilities: | ||
One Srl call option (see Note 10) | 141 | 674 |
One Srl Call Option | Level 3 | ||
Liabilities: | ||
One Srl call option (see Note 10) | $ 141 | $ 674 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Changes in Fair Value of Company's Level 3 Financial Instruments (Details) - Level 3 $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Convertible Promissory Notes | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Balance | $ 27,403 |
Issuance of convertible promissory notes | 5,000 |
Transaction price allocated to warrant issuance | (1,459) |
Change in fair value | (4,959) |
Balance | 25,985 |
One Srl Call Option | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Balance | 674 |
Change in fair value | (536) |
Foreign currency translation adjustment | 3 |
Balance | 141 |
Earnout Liability | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Balance | 563 |
Change in fair value | (563) |
Private Placement Warrant Liability | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Balance | 130 |
Change in fair value | $ (130) |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Transfers, Net [Abstract] | |
Liabilities, Transfer from Level 1 to Level 2 | $ 0 |
Liabilities, Transfer from Level 2 to Level 1 | 0 |
Liabilities, Transfer into Level 3 | 0 |
Liabilities, Transfer out of Level 3 | $ 0 |
Product Revenue Reserve and A_3
Product Revenue Reserve and Allowance - Summary of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Product Information [Line Items] | ||
Revenue | $ 1,753 | $ 7,514 |
Product Revenue, Net | ||
Product Information [Line Items] | ||
Revenue | 1,753 | 7,514 |
Roman Health Pharmacy LLC | Product Revenue, Net | ||
Product Information [Line Items] | ||
Revenue | 1,015 | 6,499 |
GoGoMeds | Product Revenue, Net | ||
Product Information [Line Items] | ||
Revenue | 661 | 1,015 |
CMS Bridging DMCC | Product Revenue, Net | ||
Product Information [Line Items] | ||
Revenue | $ 77 | $ 0 |
Product Revenue Reserve and A_4
Product Revenue Reserve and Allowance - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Product Information [Line Items] | |||
Revenue | $ 1,753 | $ 7,514 | |
Accounts receivable | 1,271 | $ 1,233 | |
Product Revenue, Net | |||
Product Information [Line Items] | |||
Revenue | 1,753 | 7,514 | |
Product Revenue, Net | Roman Health Pharmacy LLC | |||
Product Information [Line Items] | |||
Revenue | 1,015 | 6,499 | |
Deferred income | 24,700 | 25,900 | |
Product Revenue, Net | GoGoMeds | |||
Product Information [Line Items] | |||
Revenue | 661 | 1,015 | |
Accounts receivable | 1,300 | $ 1,100 | |
Product Revenue, Net | CMS Bridging DMCC | |||
Product Information [Line Items] | |||
Revenue | $ 77 | $ 0 |
Product Revenue Reserve and A_5
Product Revenue Reserve and Allowance - Summary of Activity in Product Revenue Reserve and Allowance (Details) - Product Revenue, Net - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Product Information [Line Items] | ||
Product revenue reserve and allowance, beginning balance | $ 23 | $ 82 |
Provision related to product sales | 210 | 574 |
Credits and payments made | (226) | (418) |
Product revenue reserve and allowance, ending balance | $ 7 | $ 238 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 9,394 | $ 9,549 |
Work in process | 4,361 | 4,695 |
Finished goods | 5,303 | 5,955 |
Inventories gross | 19,058 | 20,199 |
Less: inventory reserves | (13,117) | (13,334) |
Total inventories | $ 5,941 | $ 6,865 |
Inventories - Additional Inform
Inventories - Additional Information (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Estimated unsold or unutilized inventory finished goods | $ 5,000 | |
Estimated unsold or unutilized inventory work-in-progress | 4,300 | |
Estimated unsold or unutilized inventory raw material | 3,800 | |
Inventory reserves | $ 13,117 | $ 13,334 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid expenses | $ 277 | $ 314 |
Prepaid Insurance | 1,844 | 268 |
Prepaid contract research costs | 145 | 189 |
Research and development tax credit | 588 | 567 |
Value added tax receivable | 2,102 | 2,036 |
Income tax receivable | 207 | 203 |
Investment tax credit receivable | 1,488 | 1,050 |
Prepaid expenses and other current assets | $ 6,651 | $ 4,627 |
Property and Equipment, Net - S
Property and Equipment, Net - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | $ 68,116 | $ 62,907 |
Less accumulated depreciation | (9,762) | (8,137) |
Property and equipment – net | 58,354 | 59,335 |
Laboratory And Manufacturing Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | 41,303 | 29,944 |
Land and Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | 8,556 | 10,673 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | 1,552 | 1,525 |
Computer Equipment and Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | 824 | 811 |
Capitalized Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | 232 | 232 |
Construction in Process | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | $ 15,649 | $ 24,287 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 USD ($) ft² a | Mar. 31, 2022 USD ($) | |
Property, Plant and Equipment [Abstract] | ||
Area of facility under manufacturing and research and development | 51,000 | |
Area of facility under manufacturing and research and development expects to expand | 88,600 | |
Area of land | a | 12 | |
Additional area of facility initiated for construction | 207,000 | |
Depreciation | $ | $ 2,009 | $ 1,019 |
Accrued Expenses - Summary of A
Accrued Expenses - Summary of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | ||
Accrued payroll and related benefits | $ 1,656 | $ 1,550 |
Accrued professional fees and outside contractors (including due to related party of $35 and $153, respectively) | 857 | 3,521 |
Accrued property, plant and equipment additions | 180 | 378 |
Accrued inventory and manufacturing expense | 347 | 1,020 |
Unpaid portion of One S.r.l. equity acquisition (see Note 10) | 2,754 | 2,656 |
Tax payables | 578 | 543 |
Deferred legal fees | 738 | 738 |
Accrued interest | 370 | 62 |
Total accrued expenses | $ 7,480 | $ 10,468 |
Accrued Expenses - Summary of_2
Accrued Expenses - Summary of Accrued Expenses and Other Current Liabilities (Parenthetical) (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | ||
Accrued Professional fee, due to related party | $ 35 | $ 153 |
Other Long-Term Liabilities (De
Other Long-Term Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Other Liabilities Disclosure [Abstract] | ||
Long-term tax liabilities | $ 141 | $ 224 |
One S.r.l. call option (see Note 10) | 141 | 674 |
Total other long-term liabilities | $ 282 | $ 898 |
Significant Agreements - Additi
Significant Agreements - Additional Information (Details) € in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | ||
Oct. 31, 2020 EUR (€) | Aug. 31, 2020 EUR (€) | Mar. 31, 2023 USD ($) | Jun. 30, 2019 | |
One | ||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Equity interest acquired (as a percent) | 10% | |||
Research Innovation Fund Financing | ||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Proceeds from RIF | € 10 | $ 10.9 | ||
Interest rate | 6.35% | |||
Investments interest rate | 15% | |||
Annual interest rate in connection with transaction | 3.175% | |||
Long term debt term | 8 years | |||
Period of subsequent issuance | 24 months | |||
Equity interest held by related party | 20% | |||
Debt | € 15 | $ 16.3 | ||
Call Option | One | ||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Equity interest acquired (as a percent) | 10% | |||
Exercise price of call option to buy back ownership percentage | € 6 | $ 6.6 |
Significant Agreements - Summar
Significant Agreements - Summary Of Amounts Recognized On Consolidated Statements Of Operations And On Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Puglia1 Grant | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Grant Income | $ 194 | $ 212 | |
Income attributable to R&D expense | 18 | ||
Income attributable to investments in facilities and equipment | 176 | 212 | |
Grants receivable | 3,290 | $ 3,237 | |
Deferred income | 4,886 | 5,001 | |
Current portion of deferred income | 780 | 771 | |
Puglia 2 Grant | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Grant Income | 337 | 195 | |
Income attributable to R&D expense | 232 | $ 195 | |
Income attributable to investments in facilities and equipment | 105 | ||
Grants receivable | 5,168 | 122 | |
Long-term grant receivable | 4,732 | ||
Deferred income | 3,452 | 3,502 | |
Current portion of deferred income | $ 427 | $ 420 |
Significant Agreements - Schedu
Significant Agreements - Schedule of Finite Lived Intangible Assets Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||
Amortization expense | $ (567) | $ (567) |
Significant Agreements - Summ_2
Significant Agreements - Summary of Changes in Fair Value of Call Option Liability (Details) - One S.r.l - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Beginning balance | $ 674 | $ 2,416 |
Change in fair value | (536) | 258 |
Foreign currency translation gain | 3 | (51) |
Ending balance | $ 141 | $ 2,623 |
Significant Agreements - Summ_3
Significant Agreements - Summary of Weighted Average Assumptions Used to Determine Fair Value of Call Option Liability (Details) - One S R L [Member] - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Expected term | 6 months | 4 years |
Expected Volatility | 150% | 86% |
Expected dividend yield | 0 | 0 |
Risk free interest rate | 4.90% | 4.20% |
Estimated fair value of ownership interest | $ 1,622 | $ 1,772 |
Exercise price of call option | $ 6,527 | $ 6,422 |
Significant Agreements - Summ_4
Significant Agreements - Summary of Noncontrolling Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Balance at Beginning of Period | $ 12,590 | |
Balance at the End of Period | 12,896 | |
Research Innovation Fund Financing | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Balance at Beginning of Period | 12,590 | $ 11,855 |
Accretion of put option | 88 | |
Income allocated to noncontrolling interest holder | 100 | |
Foreign currency translation adjustment | 206 | (239) |
Balance at the End of Period | $ 12,896 | $ 11,704 |
Debt - Summary of Non-Convertib
Debt - Summary of Non-Convertible Debt Outstanding (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Total debt obligation | $ 33,782 | |
Non-convertible Debt | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 33,782 | $ 33,642 |
Unamortized loan discount and issuance costs | (323) | (346) |
Total debt obligation carrying amount | 33,459 | 33,296 |
Current portion | 7,422 | 7,954 |
Long-term portion | 26,037 | 25,342 |
Non-convertible Debt | Italian Economic Development Agency Loan | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 168 | 331 |
Non-convertible Debt | Intesa Sanpaolo Loan 1 | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 6,970 | 7,094 |
Non-convertible Debt | Intesa Sanpaolo Loan 2 | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 5,439 | 5,352 |
Non-convertible Debt | Horizon 2020 Loan | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 395 | 389 |
Non-convertible Debt | RIF Shareholders Loan | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 16,317 | 16,055 |
Non-convertible Debt | UniCredit Loan | ||
Debt Instrument [Line Items] | ||
Total debt obligation | $ 4,493 | $ 4,421 |
Debt - Summary of Future Maturi
Debt - Summary of Future Maturities to Debt Outstanding (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Debt Disclosure [Abstract] | |
2023 | $ 7,825 |
2024 | 5,534 |
2025 | 4,027 |
2026 | 4,047 |
2027 | 4,029 |
More than 5 years | 8,320 |
Total maturities | $ 33,782 |
Debt - Additional Information (
Debt - Additional Information (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | |||
Feb. 21, 2023 USD ($) $ / shares shares | Mar. 31, 2023 USD ($) shares | Sep. 30, 2022 USD ($) Notes Days | Dec. 31, 2022 USD ($) shares | |
Debt Instrument [Line Items] | ||||
Warrants to purchase common stock | shares | 48,421,412 | 24,733,365 | ||
Aggregate outstanding balance of debt | $ 7,422 | $ 7,954 | ||
2022 Promissory Notes | Existing Investor and Related Party | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 15% | |||
Maturity date | Dec. 31, 2023 | |||
Threshold number of business days following a qualified financing | Days | 5 | |||
Fair value of promissory notes | 22,600 | $ 27,400 | ||
Fair market gain relating to convertible promissory notes | 4,800 | |||
CMS Bridging DMCC, PureTech Health LLC and SSD2 LLC | 2022 Promissory Notes | ||||
Debt Instrument [Line Items] | ||||
Number of promissory notes issued | Notes | 3 | |||
Aggregate principal amount of notes | $ 25,000 | |||
Aggregate cash proceeds | $ 25,000 | |||
Note and Warrant Purchase Agreement | PureTech Health LLC | ||||
Debt Instrument [Line Items] | ||||
Warrants to purchase common stock | shares | 23,688,047 | |||
Exercise price of warrants | $ / shares | $ 0.2744 | |||
Total proceeds from agreement | $ 5,000 | |||
Note and Warrant Purchase Agreement | PureTech Health LLC | Warrants | ||||
Debt Instrument [Line Items] | ||||
Allocated fair value of warrants | 1,500 | |||
Deferred financing costs | 200 | |||
Note and Warrant Purchase Agreement | PureTech Health LLC | Senior Secured Note | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount of notes | $ 5,000 | |||
Interest rate | 12% | |||
Maturity date | Jul. 31, 2023 | |||
Maximum additional debt instrument available for issuance | $ 5,000 | |||
Percentage of debt holder's equity pledged | 100% | |||
Fair value of debt | $ 3,500 | |||
Deferred financing costs | $ 400 | |||
Aggregate outstanding balance of debt | 3,400 | |||
Fair market gain recognized on debt | 100 | |||
Non-cash interest expense on debt | $ 400 |
Debt - Summary of Assumptions U
Debt - Summary of Assumptions Used to Determine Fair Value of Debt (Details) | 3 Months Ended | 12 Months Ended | |
Feb. 21, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | |
2022 Promissory Notes | |||
Debt Instrument [Line Items] | |||
Expected term | 9 months | 1 year | |
Weighted average discount rate | 26% | 26% | |
Probability of repayment after qualified financing | 50% | ||
Probability of holder electing conversion option | 10% | 50% | |
Probability of a business combination | 60% | ||
Probability of Company default | 30% | ||
Senior Secured Note | |||
Debt Instrument [Line Items] | |||
Expected term | 4 months 24 days | 3 months 18 days | |
Weighted average discount rate | 26.90% | 26.90% | |
Probability of holder electing conversion upon a business combination | 50% | 60% | |
Probability of Company default | 40% | 30% | |
Probability of holder electing conversion option upon other default events | 10% | 10% |
Debt - Summary of Fair Value of
Debt - Summary of Fair Value of Warrants Based on Black-Scholes Inputs (Details) - PureTech Health LLC - Note and Warrant Purchase Agreement - Warrant | Feb. 21, 2023 $ / shares |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Market price of common stock | $ 0.28 |
Expected term | 2 months 26 days |
Expected Volatility | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Warrants, fair value measurement input | 160 |
Risk Free Interest Rate | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Warrants, fair value measurement input | 4.9 |
Warrants Liabilities - Summary
Warrants Liabilities - Summary of Warrants Outstanding (Details) - Private Placement $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Class Of Warrant Or Right [Line Items] | |
Balance | $ 130 |
Change in fair value | $ (130) |
Warrant Liabilities - Additiona
Warrant Liabilities - Additional Information (Details) $ / shares in Units, $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) $ / shares shares | |
Class of Warrant or Right [Line Items] | |
Minimum share price requirement trading days period | 30 days |
Maximum | |
Class of Warrant or Right [Line Items] | |
OTC market trade | $ 0.05 |
Minimum | |
Class of Warrant or Right [Line Items] | |
Average global market capitalization | $ | $ 15 |
OTC market trade | $ 0.01 |
Private Placement | |
Class of Warrant or Right [Line Items] | |
Number of warrants outstanding | shares | 7,520,000 |
Private Placement | Class A common stock | |
Class of Warrant or Right [Line Items] | |
Exercise price of warrants | $ 11.50 |
Warrants Liabilities - Summar_2
Warrants Liabilities - Summary of Weighted Average Assumptions of Fair Value of Liabilities (Details) - Private Placement - Level 3 - Monte Carlo Simulation value model | Dec. 31, 2022 yr |
Expected term | |
Class Of Warrant Or Right [Line Items] | |
Private Placement Warrants | 4 |
Expected Volatility | |
Class Of Warrant Or Right [Line Items] | |
Private Placement Warrants | 86 |
Expected Dividend Yield | |
Class Of Warrant Or Right [Line Items] | |
Private Placement Warrants | 0 |
Risk Free Interest Rate | |
Class Of Warrant Or Right [Line Items] | |
Private Placement Warrants | 4 |
Price Of Gelesis Common Stock | |
Class Of Warrant Or Right [Line Items] | |
Private Placement Warrants | 0.29 |
Exercise Price of Warrants | |
Class Of Warrant Or Right [Line Items] | |
Private Placement Warrants | 11.50 |
Earnout Liability - Summary of
Earnout Liability - Summary of Earnout Liability Activity (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Derivatives, Fair Value [Line Items] | |
Balance | $ 563 |
Changes in fair value | (563) |
Balance | $ 0 |
Earnout Liability - Additional
Earnout Liability - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Maximum | |
Derivatives, Fair Value [Line Items] | |
OTC market trade | $ 0.05 |
Minimum | |
Derivatives, Fair Value [Line Items] | |
OTC market trade | $ 0.01 |
Earnout Liability | |
Derivatives, Fair Value [Line Items] | |
Number of earn out shares unissued and unvested | shares | 18,758,241 |
Earnout Liability - Summary o_2
Earnout Liability - Summary of Weighted Average Assumptions Used to Determine Fair Value of Earnout Liability (Details) - Level 3 - Monte Carlo Simulation value model - Earnout Liability | Dec. 31, 2022 yr |
Expected term | |
Derivatives, Fair Value [Line Items] | |
Derivative Liability, Measurement Input | 4 |
Expected Volatility | |
Derivatives, Fair Value [Line Items] | |
Derivative Liability, Measurement Input | 86 |
Expected Dividend Yield | |
Derivatives, Fair Value [Line Items] | |
Derivative Liability, Measurement Input | 0 |
Risk Free Interest Rate | |
Derivatives, Fair Value [Line Items] | |
Derivative Liability, Measurement Input | 4 |
Price Of Gelesis Common Stock | |
Derivatives, Fair Value [Line Items] | |
Derivative Liability, Measurement Input | 0.29 |
Stockholder's Equity (Deficit_2
Stockholder's Equity (Deficit) - Additional Information (Details) | 3 Months Ended | |||
Jan. 13, 2022 $ / shares shares | Mar. 31, 2023 Item Days $ / shares shares | Mar. 31, 2022 USD ($) shares | Dec. 31, 2022 $ / shares shares | |
Class of Stock [Line Items] | ||||
Common shares, shares authorized (in shares) | 900,000,000 | 900,000,000 | ||
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | ||
Common shares, shares issued (in shares) | 73,332,588 | 73,325,022 | ||
Common shares, shares outstanding (in shares) | 73,332,588 | 73,325,022 | ||
Preferred stock, shares authorized | 250,000,000 | 250,000,000 | ||
Preferred stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | ||
Common Stock | ||||
Class of Stock [Line Items] | ||||
Common shares, shares authorized (in shares) | 900,000,000 | |||
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | |||
Common shares, shares issued (in shares) | 73,332,588 | |||
Common shares, shares outstanding (in shares) | 73,332,588 | |||
Public Warrants | ||||
Class of Stock [Line Items] | ||||
Number of warrants outstanding | 13,800,000 | |||
Exercise price of warrants | $ / shares | $ 11.50 | |||
Warrants expiration term | 5 years | |||
Public Warrants | Common Stock | ||||
Class of Stock [Line Items] | ||||
Number of warrants outstanding | 13,800,000 | |||
Public Warrants | Redemption of Warrants When the Price per Class A Ordinary Share Equals or Exceeds $18.00 | ||||
Class of Stock [Line Items] | ||||
Redemption price per public warrant (in dollars per share) | $ / shares | $ 0.01 | |||
Redemption period | 30 days | |||
Threshold trading days for redemption of public warrants | Days | 20 | |||
Minimum threshold written notice period for redemption of public warrants | Item | 30 | |||
Threshold number of business days before sending notice of redemption to warrant holders | Item | 3 | |||
Public Warrants | Minimum | Redemption of Warrants When the Price per Class A Ordinary Share Equals or Exceeds $18.00 | ||||
Class of Stock [Line Items] | ||||
Class of warrant or right redemption of warrants or rights stock price trigger | $ / shares | $ 18 | |||
Roller Warrants | ||||
Class of Stock [Line Items] | ||||
Number of warrants outstanding | 1,353,062 | 1,353,062 | ||
Exercise price of warrants | $ / shares | $ 4.26 | $ 4.26 | ||
Warrants exchange ratio | 2.59 | |||
Warrant conversion terms | Immediately prior to the closing of the Business Combination, Legacy Gelesis redeemable preferred stock warrants were converted into Legacy Gelesis common warrants and were subsequently split according to the exchange ratio of 2.59. Upon closing of the Business Combination, holders received shares of common stock of the Company on a one-to-one basis. | |||
Warrants exercised | 176,126 | |||
Roller Warrants | Common Stock | ||||
Class of Stock [Line Items] | ||||
Number of warrants outstanding | 1,836,429 | 1,660,303 | ||
Exercise price of warrants | $ / shares | $ 0.02 | $ 0.02 | ||
Warrants exchange ratio | 2.59 | |||
Roller Warrants | Maximum | ||||
Class of Stock [Line Items] | ||||
Proceeds from warrants exercised | $ | $ 100,000 |
Stockholder's Equity (Deficit_3
Stockholder's Equity (Deficit) - Schedule of Common Stock Reserved for Future Issuance (Details) - shares | Mar. 31, 2023 | Dec. 31, 2022 |
Common Stock | ||
Common stock issued upon option exercise and RSUs vesting | 16,881,549 | 16,881,549 |
Issuances upon exercise of common stock warrants | 48,421,412 | 24,733,365 |
Earnout shares | 23,482,845 | 23,482,845 |
Total common stock reserved for future issuance | 88,785,806 | 65,097,759 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended |
Jan. 31, 2022 | Mar. 31, 2023 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total fair value of options vested | $ 1.9 | |
Restricted Stock Units (RSUs) | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unrecognized compensation cost | $ 6.4 | |
Weighted-average period of unrecognized compensation cost expected to be recognized | 2 years 10 months 24 days | |
2021 Stock Option Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of shares authorized to issue on common stock | 9,583,570 | |
Remaining shares available for issuance | 7,213,730 | |
Increase in percentage, number of shares of stock issued and outstanding | 4% | |
Expiration period of awards granted | 10 years | |
Unrecognized compensation cost | $ 5.3 | |
Weighted-average period of unrecognized compensation cost expected to be recognized | 2 years | |
2021 Stock Option Plan | Minimum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Vesting period | 3 years | |
2021 Stock Option Plan | Maximum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Vesting period | 4 years |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock-Based Compensation Expense (Details) - Employees and Non Employees - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 2,091 | $ 13,989 |
Research and Development | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation expense | 334 | 5,065 |
Selling, General and Administrative | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 1,757 | $ 8,924 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward] | ||
Number of Options, Outstanding | 12,798,479 | |
Number of Options, Forfeited - unvested | (94,673) | |
Number of Options, Expired | (428,647) | |
Number of Options, Outstanding | 12,275,159 | 12,798,479 |
Number of Options, Exercisable | 10,021,559 | |
Number of Options, Vested and expected to vest | 12,275,159 | |
Weighted Average Exercise Price per Share | ||
Weighted- Average Exercise Price per Share, Outstanding | $ 3.97 | |
Weighted- Average Exercise Price per Share, Forfeited - unvested | 3.87 | |
Weighted- Average Exercise Price per Share, Expired | 4.06 | |
Weighted- Average Exercise Price per Share, Outstanding | 3.97 | $ 3.97 |
Weighted- Average Exercise Price per Share, Exercisable | 3.91 | |
Weighted- Average Exercise Price per Share, Vested and expected to vest | $ 3.96 | |
Weighted Average Remaining Contractual Term (Years) | ||
Weighted- Average Remaining Contractual Term (Years), Outstanding | 5 years 5 months 19 days | 5 years 9 months 18 days |
Weighted- Average Remaining Contractual Term (Years), Exercisable | 4 years 9 months 7 days | |
Weighted- Average Remaining Contractual Term (Years), Vested and expected to vest | 5 years 5 months 19 days | |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value, Outstanding | $ 25 |
Stock-Based Compensation - Su_3
Stock-Based Compensation - Summary of Restricted Stock Unit Activity (Details) - Restricted Stock Units (RSUs) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of RSUs, Outstanding and Unvested | shares | 4,083,070 |
Number of RSUs, Vested | shares | (7,566) |
Number of RSUs, Forfeited | shares | (254,982) |
Number of RSUs, Outstanding and Unvested | shares | 3,820,522 |
Weighted- Average Grant Date Fair Value, Outstanding and Unvested | $ / shares | $ 4.31 |
Weighted- Average Grant Date Fair Value, Vested | $ / shares | 8.26 |
Weighted- Average Grant Date Fair Value, Forfeited | $ / shares | 3.33 |
Weighted- Average Grant Date Fair Value, Outstanding and Unvested | $ / shares | $ 4.36 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Provision for income taxes | $ 16 | $ 0 |
U.S statutory rate | 21% | 21% |
Earnings (Loss) Per Share - Sum
Earnings (Loss) Per Share - Summary of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Numerator: | ||
Net loss | $ (5,146) | $ (5,703) |
Accretion of Legacy Gelesis senior preferred stock to redemption value | (37,934) | |
Accretion of noncontrolling interest put option to redemption value | (88) | |
Income allocated to noncontrolling interest holder | (100) | |
Net loss attributable to common stockholders | $ (5,246) | $ (43,725) |
Denominator: | ||
Weighted average common shares outstanding - basic | 73,329,309 | 62,743,154 |
Weighted average common shares outstanding - diluted | 73,329,309 | 62,743,154 |
Net loss per share, basic | $ (0.07) | $ (0.70) |
Net loss per share, diluted | $ (0.07) | $ (0.70) |
Earnings (Loss) Per Share - Sch
Earnings (Loss) Per Share - Schedule of Anti-dilutive Securities Excluded from Computation of Net Loss Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of net loss per share | 65,302,961 | 41,214,914 |
Options and RSU to Acquire Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of net loss per share | 16,881,549 | 16,881,549 |
Warrants on Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of net loss per share | 48,421,412 | 24,333,365 |
Earnings (Loss) per Share (Addi
Earnings (Loss) per Share (Additional Information) (Details) | 3 Months Ended |
Mar. 31, 2023 shares | |
Earnings Per Share [Abstract] | |
Potentially dilutive common share equivalents | 23,482,845 |
Commitment and Contingencies -
Commitment and Contingencies - Additional Information (Details) $ in Thousands, € in Millions | 1 Months Ended | 3 Months Ended | ||
Jun. 30, 2019 USD ($) | Dec. 31, 2009 | Mar. 31, 2023 USD ($) | Mar. 31, 2023 EUR (€) | |
Loss Contingencies [Line Items] | ||||
Operating lease commencement | 2019-06 | |||
Operating lease expiration | 2025-08 | |||
Total lease payments | $ 1,534 | |||
Operating lease remaining weighted average lease terms | 2 years 6 months | 2 years 6 months | ||
Operating lease weighted average discount rate, percent | 5.20% | 5.20% | ||
Office space located in Boston | ||||
Loss Contingencies [Line Items] | ||||
Total lease payments | $ 3,200 | |||
Certain Storage and Equipment | ||||
Loss Contingencies [Line Items] | ||||
Operating lease expiring year | 2027 | |||
PureTech | Royalty and Sublicense Income Agreement | ||||
Loss Contingencies [Line Items] | ||||
Royalty payment required percentage | 2% | |||
One S.r.l | Amended And Restated Master Agreement | ||||
Loss Contingencies [Line Items] | ||||
Percentage of royalty | 2% | |||
Payments to be made upon the achievement of certain milestones | $ 19,000 | € 17.5 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Operating Lease Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Operating lease liabilities | $ 587 | $ 548 | $ 597 |
Operating lease liabilities | 835 | 1,374 | $ 967 |
Total operating lease liabilities | 1,422 | 1,922 | |
Operating lease rental expense | $ 184 | $ 131 |
Commitment and Contingencies _2
Commitment and Contingencies - Schedule of Future Maturities of the Lease Liability Under the Company's Noncancelable Operating Leases (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Mar. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
Remaining 2023 maturities | $ 504 | |
2024 | 583 | |
2025 | 391 | |
2026 | 38 | |
2027 | 18 | |
More than 5 Years | 0 | |
Total undiscounted lease maturities | 1,534 | |
Imputed interest | (112) | |
Total lease liability | $ 1,422 | $ 1,922 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||||
Feb. 21, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Jul. 25, 2022 | |
Related Party Transaction [Line Items] | |||||
Accounts payable, due to related party | $ 421 | $ 135 | |||
Notes payable | 1,958 | $ 2,007 | |||
Gain of change in fair value of the instrument | $ 4,959 | $ (156) | |||
Number of shares called by warrants issued | 48,421,412 | 24,733,365 | |||
RIF Transaction | |||||
Related Party Transaction [Line Items] | |||||
Principal amount | $ 16,300 | ||||
PureTech | |||||
Related Party Transaction [Line Items] | |||||
Loss of change in fair value of convertible promissory notes | 100 | ||||
PureTech | 2022 Promissory Notes | |||||
Related Party Transaction [Line Items] | |||||
Principal amount | $ 15,000 | ||||
Notes payable | 13,600 | $ 16,600 | |||
Gain of change in fair value of the instrument | 2,900 | ||||
PureTech | Management Services Expenses | |||||
Related Party Transaction [Line Items] | |||||
Research and development, including related party expenses | 100 | ||||
Accounts payable, due to related party | 400 | 100 | |||
PureTech | Royalty Expense | |||||
Related Party Transaction [Line Items] | |||||
Research and development, including related party expenses | 100 | $ 200 | |||
SSD2 | 2022 Promissory Notes | |||||
Related Party Transaction [Line Items] | |||||
Principal amount | 4,500 | $ 5,500 | $ 5,000 | ||
Gain of change in fair value of the instrument | 1,000 | ||||
Maximum | PureTech | Management Services Expenses | |||||
Related Party Transaction [Line Items] | |||||
Research and development, including related party expenses | 100 | ||||
Note and Warrant Purchase Agreement | PureTech | |||||
Related Party Transaction [Line Items] | |||||
Gross proceeds | $ 5,000 | ||||
Note and Warrant Purchase Agreement | PureTech | Warrants | |||||
Related Party Transaction [Line Items] | |||||
Number of shares called by warrants issued | 23,688,047 | ||||
Exercise price of warrants | $ 0.2744 | ||||
Note and Warrant Purchase Agreement | PureTech | Senior Secured Note | |||||
Related Party Transaction [Line Items] | |||||
Principal amount | $ 5,000 | $ 3,400 |
Related Party Transactions - _2
Related Party Transactions - Additional Information - One S.r.l (Details) $ in Thousands, € in Millions | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2023 USD ($) | Mar. 31, 2023 EUR (€) | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2022 EUR (€) | |
Related Party Transaction [Line Items] | |||||
Cost of goods sold | $ 1,237 | $ 4,913 | |||
Founder of One | Consulting Agreement | Maximum | |||||
Related Party Transaction [Line Items] | |||||
Research and development, including related party expenses | 100 | 100 | |||
Outstanding accrued expenses and remaining undiscounted payments, related parties | 100 | $ 100 | |||
One S.r.l | |||||
Related Party Transaction [Line Items] | |||||
Payments related to acquisition | $ 2,700 | € 2.5 | 2,700 | € 2.5 | |
One S.r.l | Equity Interest | |||||
Related Party Transaction [Line Items] | |||||
Equity interest acquired (as a percent) | 10% | ||||
One S.r.l | Royalty Expense | |||||
Related Party Transaction [Line Items] | |||||
Outstanding accrued expenses and remaining undiscounted payments, related parties | $ 100 | ||||
Cost of goods sold | $ 100 | $ 100 | |||
One S.r.l | Royalty Expense | Maximum | |||||
Related Party Transaction [Line Items] | |||||
Outstanding accrued expenses and remaining undiscounted payments, related parties | $ 100 |
Related Party Transactions - _3
Related Party Transactions - Additional Information - RIF (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended |
Aug. 31, 2020 | Mar. 31, 2023 | Dec. 31, 2021 | |
Equity investment that can be called beginning in December 2023 and ending in December 2026 | |||
Related Party Transaction [Line Items] | |||
Annual interest rate in connection with transaction | 15% | ||
Put by RIF starting in January 2027 and ending in December 2027 | |||
Related Party Transaction [Line Items] | |||
Annual interest rate in connection with transaction | 3.175% | ||
RIF Transaction | |||
Related Party Transaction [Line Items] | |||
Proceeds from sale of equity investment | $ 12.3 | ||
Equity interest held by related party | 20% | ||
Principal amount | $ 16.3 | ||
Fixed interest rate on loan | 6.35% |
Subsequent Event(s) - Additiona
Subsequent Event(s) - Additional Information (Details) - USD ($) | 3 Months Ended | ||||
May 01, 2023 | Apr. 10, 2023 | Mar. 31, 2023 | Apr. 02, 2023 | Dec. 31, 2022 | |
Subsequent Event [Line Items] | |||||
Minimum share price requirement trading days period | 30 days | ||||
Warrants to purchase common stock | 48,421,412 | 24,733,365 | |||
Minimum | |||||
Subsequent Event [Line Items] | |||||
Average global market capitalization | $ 15,000,000 | ||||
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Minimum share price requirement trading days period | 30 days | ||||
Subsequent Event | Minimum | |||||
Subsequent Event [Line Items] | |||||
Average global market capitalization | $ 15,000,000 | ||||
PureTech Health LLC | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Business acquisition, share price | $ 0.21 | ||||
Maximum additional debt instrument available for issuance | $ 5,000,000 | ||||
PureTech Health LLC | Subsequent Event | Note and Warrant Purchase Agreement | |||||
Subsequent Event [Line Items] | |||||
Aggregate cash purchase price | $ 2,000,000 | ||||
Aggregate principal amount of notes | $ 2,000,000 | ||||
Exercise price of warrants | $ 0.0182 | ||||
PureTech Health LLC | Subsequent Event | Maximum | Note and Warrant Purchase Agreement | |||||
Subsequent Event [Line Items] | |||||
Warrants to purchase common stock | 192,307,692 |