Document and Entity Information
Document and Entity Information | 6 Months Ended |
Jun. 30, 2022 | |
Document and Entity Information | |
Document Type | S-1 |
Entity Registrant Name | Gelesis Holdings, Inc. |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Central Index Key | 0001805087 |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash | $ 28,397,000 | $ 491,827 |
Prepaid expenses | 982,000 | 65,973 |
Total current assets | 66,006,000 | 557,800 |
Marketable securities held in Trust Account | 276,207,207 | 276,209,453 |
Total assets | 146,301,000 | 276,767,253 |
LIABILITIES AND STOCKHOLDERS' DEFICIT | ||
Current liabilities - Accounts payable and accrued expenses | 13,660,000 | 1,630,832 |
Warrant liabilities | 22,499,441 | 30,101,808 |
Deferred underwriting fee payable | 9,660,000 | 9,660,000 |
Total liabilities | 152,688,000 | 41,392,640 |
Commitments (Note 6) | ||
Class A common stock subject to possible redemption 27,600,000 shares at redemption value as of December 31, 2021 and 2020 | 276,000,000 | 276,033,447 |
Stockholders' Deficit | ||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding | ||
Common stock | 1,000 | |
Additional paid-in capital | (64,549,000) | |
Accumulated deficit | (265,507,000) | (171,784,000) |
Total stockholders' equity (deficit) | (329,836,000) | (40,658,834) |
Total liabilities, noncontrolling interest, redeemable convertible preferred stock and stockholders' equity (deficit) | 146,301,000 | 276,767,253 |
Class B common stock | ||
Stockholders' Deficit | ||
Common stock | $ 690 | $ 690 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Feb. 26, 2020 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Preferred stock, shares authorized | 250,000,000 | 1,000,000 | 1,000,000 | |
Preferred stock, shares issued | 0 | 0 | 0 | |
Preferred stock, shares outstanding | 0 | 0 | 0 | |
Common stock, par value | $ 0.0001 | $ 0.0001 | ||
Common stock, shares authorized | 900,000,000 | 125,961,571 | ||
Common stock, shares issued | 72,552,477 | 6,248,192 | ||
Common stock, shares outstanding | 72,552,477 | 6,248,192 | ||
Class A common stock | ||||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Common stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 | |
Common stock, shares issued | 0 | 0 | ||
Common stock, shares outstanding | 0 | 0 | ||
Temporary Equity Shares Outstanding | 27,600,000 | 27,600,000 | ||
Class B common stock | ||||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Common stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | |
Common stock, shares issued | 6,900,000 | 6,900,000 | ||
Common stock, shares outstanding | 6,900,000 | 6,900,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 11 Months Ended | 12 Months Ended |
Dec. 31, 2020 | Dec. 31, 2021 | |
General and administrative expenses | $ 2,426,204 | $ 20,674,209 |
Loss from operations | (2,426,204) | (20,674,209) |
Other income (expense): | ||
Interest earned on marketable securities held in Trust Account | 201,441 | 167,045 |
Unrealized gain on marketable securities held in Trust Account | 8,012 | 6,715 |
Change in fair value of warrant liabilities | (12,406,208) | 7,602,367 |
Transaction costs associated with the Initial Public Offering | (671,901) | |
Total other expense, net | (12,868,656) | 7,776,127 |
Net loss | $ (15,294,860) | $ (12,898,082) |
Class A common stock | ||
Other income (expense): | ||
Weighted Average Number of Shares Outstanding, Basic | 15,218,692 | 27,600,000 |
Weighted Average Number of Shares Outstanding, Diluted | 15,218,692 | 27,600,000 |
Earnings Per Share, Basic | $ (0.70) | $ (0.37) |
Earnings Per Share, Diluted | $ (0.70) | $ (0.37) |
Class B common stock | ||
Other income (expense): | ||
Weighted Average Number of Shares Outstanding, Basic | 6,496,262 | 6,900,000 |
Weighted Average Number of Shares Outstanding, Diluted | 6,496,262 | 6,900,000 |
Earnings Per Share, Basic | $ (0.70) | $ (0.37) |
Earnings Per Share, Diluted | $ (0.70) | $ (0.37) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT - USD ($) | Class A common stock Common Stock | Class B common stock Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at the end at Dec. 31, 2020 | $ 690 | $ (40,659,524) | $ (40,658,834) | ||
Balance at the end (in shares) at Dec. 31, 2020 | 6,900,000 | ||||
Balance at the beginning at Feb. 13, 2020 | $ 0 | $ 0 | $ 0 | 0 | 0 |
Balance at the beginning (in shares) at Feb. 13, 2020 | 0 | 0 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of Class B common stock to Sponsor | $ 690 | 24,310 | 25,000 | ||
Issuance of Class B common stock to Sponsor (in shares) | 6,900,000 | ||||
Remeasurement of Class A common stock to redemption amount | 1,302,710 | 25,364,664 | 26,667,374 | ||
Excess cash received from sale of Private Placement Warrants | 1,278,400 | 1,278,400 | |||
Net income (loss) | $ 0 | $ 0 | $ 0 | (15,294,860) | (15,294,860) |
Balance at the end at Dec. 31, 2020 | $ 690 | (40,659,524) | (40,658,834) | ||
Balance at the end (in shares) at Dec. 31, 2020 | 6,900,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Remeasurement of Class A common stock to redemption amount | 33,447 | 33,447 | |||
Net income (loss) | (12,898,082) | (12,898,082) | |||
Balance at the end at Dec. 31, 2021 | $ 690 | $ (53,524,159) | (329,836,000) | ||
Balance at the end (in shares) at Dec. 31, 2021 | 6,900,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income (loss) | (18,216,000) | ||||
Balance at the end at Jun. 30, 2022 | $ 5,098,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 11 Months Ended | 12 Months Ended |
Dec. 31, 2020 | Dec. 31, 2021 | |
Net Cash Provided By Used In Operating Activities [Abstract] | ||
Net loss | $ (15,294,860) | $ (12,898,082) |
Adjustments To Reconcile Net Income Loss To Cash Provided By Used In Operating Activities [Abstract] | ||
Interest earned on marketable securities held in Trust Account | (201,441) | (167,045) |
Unrealized gain on marketable securities held in Trust Account | (8,012) | (6,715) |
Transaction costs associated with the Initial Public Offering | 671,901 | |
Change in fair value of warrant liabilities | 12,406,208 | (7,602,367) |
Increase Decrease In Operating Capital [Abstract] | ||
Prepaid expenses | (65,973) | 52,470 |
Accounts payable and accrued expenses | 1,630,832 | 20,175,095 |
Net cash used in operating activities | (861,345) | (446,644) |
Net Cash Provided By Used In Investing Activities [Abstract] | ||
Cash withdrawn from Trust Account to pay for franchise taxes | 176,006 | |
Investment of cash into Trust Account | (276,000,000) | |
Net cash (used in) provided by investing activities | (276,000,000) | 176,006 |
Net Cash Provided By Used In Financing Activities [Abstract] | ||
Proceeds from issuance of Class B common stock to Sponsor | 25,000 | |
Proceeds from sale of Units, net of underwriting discounts paid | 270,480,000 | |
Proceeds from sale of Private Placement Warrants | 7,520,000 | |
Proceeds from promissory note - related party | 150,000 | |
Repayment of promissory note - related party | (150,000) | |
Payment of offering costs | (671,828) | |
Net cash provided by financing activities | 277,353,172 | |
Net decrease in cash | 491,827 | (270,638) |
Cash and cash equivalents at beginning of year | 48,144,000 | |
Cash and cash equivalents at end of period | 48,144,000 | 28,397,000 |
Non-Cash investing and financing activities: | ||
Remeasurement of Class A common stock to redemption amount | 26,667,374 | $ 33,447 |
Deferred underwriting fee payable | 9,660,000 | |
Initial classification of warrant liability | $ 17,695,600 |
DESCRIPTION OF ORGANIZATION AND
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS | 12 Months Ended |
Dec. 31, 2021 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS | NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS Capstar Special Purpose Acquisition Corp. (now known as Gelesis Holdings, Inc.) (the “Company” or “CPSR”) was a blank check company incorporated in Delaware on February 14, 2020. The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (the “Business Combination”). Although the Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination, the Company intends to focus on businesses in the consumer, healthcare and technology, media and telecommunications (“TMT”) industries. The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies. Business Combination On January 13, 2022 (the “Closing Date”), CPSR consummated the previously announced business combination (the “Business Combination”), pursuant to the terms of the Business Combination Agreement, dated as of July 19, 2021 (as amended on November 8, 2021 and December 30, 2021, the “Business Combination Agreement”), by and among CPSR, CPSR Gelesis Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of CPSR (“Merger Sub”), and Gelesis, Inc., a Delaware corporation (together with its consolidated subsidiaries, “Legacy Gelesis”). Pursuant to the Business Combination Agreement, on the Closing Date, (i) Merger Sub merged with and into Legacy Gelesis (the “Merger”), with 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”). In accordance with the terms and subject to the conditions of the Business Combination Agreement, at the effective time of the Merger (the “Effective Time”), based on an implied Legacy Gelesis equity value of $675 million, (i) each share of Legacy Gelesis common stock outstanding as of immediately prior to the Effective Time was exchanged for shares of the common stock, par value $0.0001 per share, of Gelesis Holdings (“Common Stock”); (ii) all vested and unvested options of Legacy Gelesis were assumed by Gelesis Holdings exercisable for shares of Common Stock; (iii) each outstanding warrant of Legacy Gelesis was assumed by Gelesis Holdings and became a warrant to purchase shares of Common Stock; (iv) each share of Class A common stock, par value $0.0001 per share, of CPSR (“CPSR Class A Common Stock”) and each share of Class B common stock, par value $0.0001 per share, of CPSR (“CPSR Class B Common Stock”), that was issued and outstanding immediately prior to the Effective Time became one share of Common Stock following the consummation of the Business Combination; (v) each outstanding redeemable public warrant of CPSR was automatically converted into a redeemable public warrant to purchase a share of Common Stock; and (vi) each outstanding Private Placement Warrant of CPSR was automatically converted into a Private Placement Warrant to purchase a share of Common Stock. Concurrently with the execution of the Business Combination Agreement, on July 19, 2021, CPSR entered into subscription agreements (the “Subscription Agreements”) with certain investors (the “PIPE Investors”), pursuant to which the PIPE Investors agreed to subscribe for and purchase, and CPSR agreed to issue and sell to the PIPE Investors, an aggregate of 9,000,000 shares of CPSR Class A Common Stock at a price of $10.00 per share, for aggregate gross proceeds of $90,000,000 (the “PIPE Financing”). The PIPE Financing was consummated concurrently with the Business Combination Closing. On December 13, 2021, the Company entered into a bridge financing arrangement (the “Bridge Financing”), executing convertible promissory note agreements with two existing investors in the aggregate amount of $27.0 million. These convertible promissory notes bore interest at 10.0% and were settled in cash for principal plus accrued interest on January 19, 2022. On December 30, 2021, CPSR entered into a Backstop Agreement (the “Backstop Agreement”) with PureTech Health LLC (“PureTech”) and SSD2, LLC (“SSD2” and together with PureTech, the “Backstop Purchasers”), pursuant to which the Backstop Purchasers agreed to purchase an aggregate of up to 1,500,000 shares of CPSR Class A Common Stock immediately prior to the Closing at a cash purchase price of $10.00 per share (the “Backstop Purchase Shares”), resulting in aggregate proceeds of up to $15.0 million, which amount, when added to the proceeds from the PIPE Financing, would ensure that the Minimum Cash Condition would be satisfied. Pursuant to the terms and conditions of the Backstop Agreement, the Backstop Purchasers were obligated to purchase Backstop Purchase Shares in such number that resulted in gross proceeds to CPSR equal to the amount by which $15.0 million exceeded the available funds remaining in CPSR’s Trust Account (as defined below) following all Capstar Stockholder Redemptions (the “Available Funds”), subject to the other terms and conditions of the Backstop Agreement. Based on the number of Capstar Stockholder Redemptions, the Backstop Purchasers became obligated to purchase an aggregate 744,217 Backstop Purchase Shares for an aggregate purchase price of $7,442,170, which is the amount by which $15.0 million exceeded the Available Funds. In addition, at the closing of the sale of the Backstop Purchase Shares, CPSR issued to the Backstop Purchasers 1,983,750 shares of CPSR Class A Common Stock. In addition to the above consideration, if the trading price of the Common Stock is greater than or equal to $12.50, $15.00 and $17.50, respectively, for any twenty thirty On January 11, 2022, CPSR held a special meeting of stockholders (the “Special Meeting”) at which the stockholders of CPSR considered and approved, among other matters, a proposal to adopt the Business Combination Agreement. Prior to the Special Meeting, holders of 26,844,777 shares of CPSR Class A Common Stock exercised their right to redeem such shares for cash at a price of approximately 10.00 per share for aggregate payments of $268,646,943. At the Closing, (i) an aggregate of 755,223 shares of CPSR Class A Common Stock and 4,916,250 shares of CPSR Class B Common Stock were exchanged for an equivalent number of shares of Common Stock; (ii) an aggregate of 54,814,847 shares of Common Stock were issued in exchange for shares of common stock, par value $0.0001 per share, of Legacy Gelesis (“Legacy Gelesis Common Stock”) outstanding as of immediately prior to the Effective Time; (iii) an aggregate of 9,000,000 shares of Common Stock were issued to the PIPE Investors in connection with the PIPE Financing; (iv) an aggregate of 2,727,967 shares of Common Stock were issued to the Backstop Purchasers; and (v) the Company had an earnout obligation pursuant to which it may be required to issue up to 23,482,845 shares of Common Stock. Moreover, at the Closing, (i) each outstanding redeemable public warrant of CPSR, each outstanding private placement warrant of CPSR and each outstanding warrant of Legacy Gelesis became a warrant to purchase shares of Common Stock and (ii) each vested and unvested option of Legacy Gelesis outstanding as of immediately prior to the Effective Time was assumed by Gelesis Holdings, to be settled or exercisable for shares of Common Stock, based on an implied Legacy Gelesis equity value of $675 million. Immediately after giving effect to the Transactions, there were 72,214,287 shares of Common Stock outstanding and 13,486,708 shares of Common Stock subject to outstanding equity awards. Business Prior to the Business Combination Prior to the Business Combination, the Company had one wholly-owned subsidiary, CPSR Gelesis Merger Sub, Inc., which was incorporated in the State of Delaware on July 2, 2021 (“Merger Sub”). As of December 31, 2021, the Company had not commenced any operations. All activity through December 31, 2021 relates to the Company’s formation, its initial public offering (“Initial Public Offering”), which is described below, the search for a target company for a Business Combination and activities in connection with the proposed business combination with Legacy Gelesis. The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company generates non-operating income in the form of interest income from the marketable securities held in the Trust Account. The registration statement for the Company’s Initial Public Offering was declared effective on July 1, 2020. On July 7, 2020, the Company consummated the Initial Public Offering of 27,600,000 units (the “Units” and, with respect to the shares of Class A common stock included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriters of the over-allotment option to purchase an additional 3,600,000 Units, at $10.00 per Unit, generating gross proceeds of $276,000,000, which is described in Note 3. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 7,520,000 warrants (each, a “Private Placement Warrant” and, collectively, the “Private Placement Warrants”) at a price of $1.00 per Private Placement Warrant in a private placement to Capstar Sponsor Group, LLC (the “Sponsor”), generating gross proceeds of $7,520,000, which is described in Note 4. Transaction costs amounted to $15,851,828, consisting of $5,520,000 of underwriting fees, $9,660,000 of deferred underwriting fees and $671,828 of other offering costs. Following the closing of the Initial Public Offering on July 7, 2020, an amount of $276,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Placement Warrants was placed in a trust account (the “Trust Account”). The proceeds are held in the Trust Account located in the United States and shall be invested only in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund selected by the Company meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination or (ii) the distribution of the funds in the Trust Account. Risks and Uncertainties Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position and/or results of its operations, the specific impact is not readily determinable as of the date of these consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Liquidity and Capital Resources As of December 31, 2021, the Company had $221,189 Until the consummation of the Business Combination, the Company used the funds not held in the Trust Account for identifying and evaluating target businesses, performing due diligence on prospective target businesses, traveling to and from the offices, plants or similar location of prospective target businesses or their representatives or owners, reviewing corporate documents and material agreements of prospective target businesses and structuring, negotiating and completing a Business Combination, which was the Business Combination with Legacy Gelesis. The Company completed its Business Combination on January 13, 2022, which was the Business Combination with Legacy Gelesis, and has raised sufficient capital for its operations. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. Summary of Significant Accounting Policies Basis of Presentation The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). The Company consolidates those entities where it has a direct and indirect controlling financial interest based on either a variable interest model or voting interest model. 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. The noncontrolling interest attributable to the Company’s VIE is presented as a separate component from stockholders’ equity (deficit) in the condensed consolidated balance sheets and as a noncontrolling interest in the condensed consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholders’ equity. All intercompany balances and transactions have been eliminated in consolidation. Under the variable interest model, a controlling financial interest is determined based on which entity, if any, has (i) the power to direct the activities of the VIE that most significantly impacts the VIE’s economic performance and (ii) the obligations to absorb losses that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. The consolidation status of a VIE may change as a result of such reassessments. Changes in consolidation status are applied prospectively in accordance with U.S. GAAP. 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. Fair Value of Financial Instruments The guidance in FASB ASC 820, Fair Value Measurements and Disclosures 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, and call option liability 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: 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: One S.r.l. Call Option: 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 Effective January 1, 2020, the Company accounts for all stock-based compensation awards granted to employees and non-employees in accordance with ASC 718, Compensation – Stock Compensation ● 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. Since the adoption of ASU 2018-07 on January 1, 2020, 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. | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation. Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s consolidated financial statement with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. One of the more significant accounting estimates included in these consolidated financial statements is the determination of the fair value of the warrant liabilities. Such estimates may be subject to change as more current information becomes available and, accordingly, the actual results could differ significantly from those estimates. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2021 and 2020. Marketable Securities Held in Trust Account At December 31, 2021 and 2020, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the consolidated balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments held in Trust Account are included in interest earned on marketable securities held in Trust Account in the accompanying consolidated statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. Offering Costs The Company complies with the requirements of the ASC 340-10-S99-1. Offering costs consisted of legal, accounting, underwriting fees and other costs incurred through the Initial Public Offering that were directly related to the Initial Public Offering. The Company incurred offering costs amounting to $15,851,828 as a result of the Initial Public Offering, consisting of $5,520,000 of underwriting commissions, $9,660,000 of deferred underwriting commissions, and $671,828 of other offering costs. The offering costs were charged to temporary equity and additional paid-in capital upon the completion of the Initial Public Offering. Immediately thereafter, temporary equity was remeasured and an adjustment was recognized through additional paid in capital and accumulated deficit to adjust temporary equity to the redemption value. Warrant Liabilities The Company accounts for the Public Warrants (as defined in Note 2) and Private Placement Warrants (together with the Public Warrants, the “Warrants”) in accordance with the guidance contained in ASC 815-40, under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrants as liabilities at their fair value and adjusts the Warrants to fair value in respect of each reporting period. This liability is subject to re-measurement at each balance sheet date until the Warrants are exercised, and any change in fair value is recognized in the consolidated statements of operations. The Private Placement Warrants and the Public Warrants for periods where no observable traded price was available are valued using a Monte Carlo simulation. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrants’ quoted market price was used as the fair value as of each relevant date. Class A Common Stock Subject to Possible Redemption The Company accounts for its shares of Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s consolidated balance sheets. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable common stock are affected by charges against additional paid-in capital and accumulated deficit. At December 31, 2021 and 2020, the ordinary shares reflected in the consolidated balance sheets are reconciled in the following table: Gross proceeds $ 276,000,000 Less: Proceeds allocated to Public Warrants (11,454,000) Class A common stock issuance costs (15,179,927) Plus: Remeasurement of carrying value to redemption value 26,667,374 Common stock subject to possible redemption, 12/31/20 276,033,447 Remeasurement of carrying value to redemption value (33,447) Common stock subject to possible redemption, 12/31/21 $ 276,000,000 Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the consolidated financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The effective tax rates differ from the statutory tax rate for the periods presented primarily due to the change in warrant valuation and the valuation allowance recorded on the Company’s net operating losses. ASC 740 prescribes a recognition threshold and a measurement attribute for the consolidated financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. Net Loss Per Common Share The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. The Company has two classes of common stock, which are referred to as Class A common stock and Class B common stock. Income and losses are shared pro rata between the two classes of common stock. Net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. Remeasurement associated with the redeemable shares of Class A common stock is excluded from loss per common share as the redemption value approximates fair value. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 21,320,000 shares in the calculation of diluted loss per share, since the exercise of the warrants is contingent upon the occurrence of future events. As of December 31, 2021 and 2020, the Company did not have any other dilutive securities or other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company. As a result, diluted net loss per common share is the same as basic net loss per common share for the periods presented. The following table reflects the calculation of basic and diluted net loss per common share (in dollars, except per share amounts): For the Period from February 14, 2020 (Inception) Through Year Ended December 31, December 31, 2021 2020 Class A Class B Class A Class B Basic and diluted net loss per common share Numerator: Allocation of net loss, as adjusted $ (10,318,466) $ (2,579,616) $ (10,719,238) $ (4,575,622) Denominator: Basic and diluted weighted average stock outstanding 27,600,000 6,900,000 15,218,692 6,496,262 Basic and diluted net loss per common share $ (0.37) $ (0.37) $ (0.70) $ (0.70) Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Corporation coverage limit of $250,000. The Company has not experienced losses on this account. Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying consolidated balance sheets, primarily due to their short-term nature. The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. Recent Accounting Standards In August 2020, the FASB issued ASU No. 2020-06, “Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s consolidated financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s consolidated financial statements. |
INITIAL PUBLIC OFFERING
INITIAL PUBLIC OFFERING | 12 Months Ended |
Dec. 31, 2021 | |
INITIAL PUBLIC OFFERING | |
INITIAL PUBLIC OFFERING | NOTE 3. INITIAL PUBLIC OFFERING Pursuant to the Initial Public Offering, the Company sold 27,600,000 Units, which includes the full exercise by the underwriters of their option to purchase an additional 3,600,000 Units, at a purchase price of $10.00 per Unit. Each Unit consists of one share of Class A common stock and one |
PRIVATE PLACEMENT
PRIVATE PLACEMENT | 12 Months Ended |
Dec. 31, 2021 | |
PRIVATE PLACEMENT. | |
PRIVATE PLACEMENT | NOTE 4. PRIVATE PLACEMENT Simultaneously with the closing of the Initial Public Offering, on July 7, 2020, the Sponsor purchased an aggregate of 7,520,000 Private Placement Warrants at a price of $1.00 per Private Placement Warrant, for an aggregate purchase price of $7,520,000. Each Private Placement Warrant is exercisable to purchase one share of Class A common stock at a price of $11.50 per share. The proceeds from the Private Placement Warrants were added to the proceeds from the Initial Public Offering held in the Trust Account. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Related Party Transactions [Abstract] | ||
RELATED PARTY TRANSACTIONS | 20. 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 19). With respect to the sublease, the Company incurred lease expense of $0.1 million and $0.1 million during the three months ended June 30, 2022 and 2021, respectively, and $0.3 million and $0.2 million during the six months ended June 30, 2022 and 2021, respectively, recorded in general and administrative expenses in the accompanying condensed consolidated statements of operations. The Company incurred royalty expense of $0.2 million and less than $0.1 million during the three months ended June 30, 2022 and 2021, respectively, and $0.3 million and $0.1 million in connection with the PureTech royalty agreement (see Note 19) during the six months ended June 30, 2022 and 2021, 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 $0.1 million and $0.1 million at June 30, 2022 and December 31, 2021, respectively, in the accompanying condensed consolidated balance sheets. On December 13, 2021, the Company issued a convertible promissory note to PureTech in the principal amount of $15.0 million (see Note 12). At December 31, 2021, the outstanding balance was $15.1 million, recorded at fair value in the accompanying condensed consolidated balance sheets. On January 19, 2022 the Company settled the convertible promissory notes in cash for principal plus accrued interest in the aggregate amount of $15.2 million. During the six months ended June 30, 2022, the Company recognized a loss of $0.1 million with respect to the change in fair value of the convertible promissory notes on the accompanying condensed consolidated statements of operations. SSD2 On December 13, 2021, the Company issued a convertible promissory note to SSD2, LLC in the principal amount of $12.0 million (see Note 12). At December 31, 2021, the outstanding balance was $12.1 million, recorded at fair value in the accompanying condensed consolidated balance sheets. On January 19, 2022 the Company settled the convertible promissory notes in cash for principal plus accrued interest in the aggregate amount of $12.1 million. During the six months ended June 30, 2022, the Company recognized a loss of less than $0.1 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 the three months ended June 30, 2022 and 2021, respectively, and $0.1 million during the six months ended June 30, 2022 and 2021, 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 June 30, 2022 and December 31, 2021, respectively, in the accompanying condensed consolidated balance sheets. Acquisition of One In connection with the amended and restated master agreement with One (see Note 11), the Company acquired a 10.0% equity interest in One in exchange for cash consideration. During the six months ended June 30, 2022 the Company made a payment of $2.9 million to One shareholders with respect to the acquisition. The Company had remaining undiscounted payments of €2.5 million and €5.0 million due to One at June 30, 2022 and December 31, 2021, respectively (approximately $2.6 million and $5.7 million due to One at June 30, 2022 and December 31, 2021, respectively). The balance at June 30, 2022 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 $0.2 million and $0.1 million with One (see Note 19) during the three months ended June 30, 2022 and 2021, respectively, and $0.3 million and $0.1 million during the six months ended June 30, 2022 and 2021, respectively, recorded in cost of goods sold in the accompanying condensed consolidated statements of operations. The Company had an accounts payable balance to One S.r.l. of $0.1 million and an accrued expense balance of $0.2 million at June 30, 2022 and an accrued expense balance of less than $0.1 million at December 31, 2021, 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 June 30, 2022 (see Note 11). In addition, the shareholders of RIF provided the Company with a loan for $18.4 million with a fixed interest rate of 6.35% per annum (see Note 12). | NOTE 5. RELATED PARTY TRANSACTIONS Founder Shares On February 26, 2020, the Sponsor purchased 5,750,000 shares of the Company’s Class B common stock (the “Founder Shares”) for an aggregate price of $25,000. On July 1, 2020, the Company effected a stock dividend of 1,150,000 shares, resulting in the Company’s initial stockholders holding an aggregate of 6,900,000 Founder Shares. The Founder Shares included an aggregate of up to 900,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. All share and per-share amounts have been retroactively restated to reflect the stock dividend. As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) subsequent to a Business Combination, (x) if the last sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Administrative Support Agreement The Company entered into an agreement, commencing on July 1, 2020 through the earlier of the Company’s consummation of a Business Combination and its liquidation, to pay an affiliate of the Sponsor a total of $10,000 per month for office space, utilities and secretarial and administrative support. For the year ended December 31, 2021, the Company incurred $120,000 in fees for these services. For the period from February 14, 2020 (inception) through December 31, 2020, the Company incurred and paid $60,000 in fees for these services. At December 31, 2021, the Company had $20,000 of such fees included in account payable and accrued expense in the consolidated balance sheets. Promissory Note — Related Party On February 14, 2020, the Sponsor agreed to loan the Company an aggregate of up to $250,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Promissory Note”). The Promissory Note was non-interest bearing and payable on the earlier of July 31, 2020 or the completion of the Initial Public Offering. The outstanding balance under the Promissory Note of $140,000 was repaid at the closing of the Initial Public Offering on July 7, 2020. Borrowings under the Promissory Note are no longer available. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor, or the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On March 3, 2021, the Sponsor committed to provide the Company an aggregate of $1,500,000 in loans for working capital purposes on an as needed basis. Such loans will be evidenced by a promissory note when issued. As of December 31, 2021 and 2020, there were no amounts outstanding under the Working Capital Loans. Sponsor Loan On July 28, 2021, the Sponsor committed to provide the Company an aggregate of $4,000,000 in loans for working capital purposes. These loans will be non-interest bearing, unsecured and will be repaid upon the consummation of a Business Combination. If the Company does not consummate a Business Combination, all amounts loaned to the Company in connection with these loans will be forgiven except to the extent that the Company has funds available to it outside of its Trust Account. As of December 31, 2021, there were no amounts outstanding under these loans. |
COMMITMENTS
COMMITMENTS | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | ||
COMMITMENTS | 19. 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. At June 30, 2022, the Company’s operating lease right of use assets was $1.7 million, of which $0.5 Future maturities of the lease liability under the Company’s noncancelable operating leases at June 30, 2022 are as follows (in thousands): At June 30, 2022 Remaining 2022 maturities $ 313 2023 629 2024 553 2025 383 2026 30 More than 5 years 15 Total undiscounted lease maturities $ 1,923 Imputed interest (151) Total lease liability $ 1,772 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 $18.3 million at June 30, 2022) 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 June 30, 2022, 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. Research and Development Tax Credits The Company’s subsidiary, Gelesis S.r.l., which conducts core manufacturing and research and development activities on behalf of the Company, is eligible to receive a non-income based and non-refundable tax credits for qualified research and development activities. The Company has earned research and development tax credits in Italy for qualifying expenses incurred by performing certain research and development activities. In December 2018, the Italian government passed a new budget law, effective January 1, 2019, that amended the eligibility criteria for recognizing qualifying research and development tax credits (“2019 Budget Law”). The 2019 Budget Law requires retroactive application for research and development tax credits earned during the year ended December 31, 2019. Under the 2019 Budget Law, research and development tax credits claimed in prior periods under previous interpretations of the research and development tax credit law may potentially be repaid by the Company. The Company evaluated the potential loss under ASC 450, Contingencies The Company has recorded $2.8 million and $3.0 million as a component of other long-term liabilities in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively. In October 2021, the Italian federal tax authority initiated an audit of the research and development tax credits for the calendar years 2017 through 2019. The Company expects that this tax audit will continue through 2022. Litigation In connection with the Business Combination, the Company received a litigation demand letter from certain purported stockholders alleging that the Company was required to provide holders of Class A Common Stock a separate class vote in connection with proposed amendments of the Company’s Amended and Restated Certificate of Incorporation to increase the number of authorized shares, such that separate votes can be cast on the proposed increase in the number of shares of Class A common stock and the proposed increase in the number of shares of preferred stock. During the six months ended June 30, 2022, the Company reached an agreement to resolve the claim and settled for an immaterial cash payment. | NOTE 6. COMMITMENTS Registration Rights Pursuant to a registration rights agreement entered into on July 1, 2020, the holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants or warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares) are entitled to registration rights requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to Class A common stock). The holders of the majority of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the expenses incurred in connection with the filing of any such registration statements. On the Closing Date, Gelesis Holdings, the Sponsor, certain former directors of CPSR (the “Director Holders”) and certain former stockholders of Legacy Gelesis (the “Legacy Gelesis Holders” and, collectively with Sponsor and the Director Holders, the “Holders”) entered into an Amended and Restated Registration and Stockholder Rights Agreement (the “Registration Rights Agreement”), pursuant to which, among other things, the Holders agreed not to effect any sale or distribution of any equity securities of Gelesis Holdings held by any of them during the lock-up period described in the B. Riley Registration Rights Agreement and Gelesis Holdings agreed to register for resale, pursuant to Rule 415 of the Securities Act, certain shares of Common Stock and other equity securities of Gelesis Holdings that are held by the parties thereto from time to time. Underwriting Agreement The underwriters are entitled to a deferred fee of $0.35 per Unit, or $9,660,000 in the aggregate. The deferred fee was paid by the Company at the Business Combination Closing. |
STOCKHOLDERS' DEFICIT
STOCKHOLDERS' DEFICIT | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Stockholders Equity Note [Abstract] | ||
STOCKHOLDERS' EQUITY | 15. Stockholder’s 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 June 30, 2022 Legacy Redeemable Convertible Preferred Stock At December 31, 2021 and immediately prior to the Business Combination, Legacy Gelesis had outstanding Series A-1, Series A-2, Series A-3, Series A-4, Series A-5, Series Growth, Series 2 Growth and Series 3 Growth redeemable convertible preferred stock which are collectively referred to as “redeemable convertible preferred stock.” Immediately prior to the closing of the Business Combination, Legacy Gelesis redeemable convertible preferred stock converted into Legacy Gelesis common stock and was 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. 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 at 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 June 30, 2022, 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 rollover common stock warrants of the Company on a one-to-one basis. At close of Business Combination and June 30, 2022, there were 1,836,429 and 1,660,303 rollover warrants outstanding, respectively, with an exercise price of $0.02. During the six months ended June 30, 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 at June 30, 2022, respectively, there were 1,353,062 of these warrants outstanding with an exercise price of $4.26. At June 30, 2022 and December 31, 2021 common stock reserved for future issuances was as follows: June 30, December 31, 2022 2021 Common stock issued upon option exercise and RSUs vesting 20,000,493 13,486,708 Conversion of all classes of redeemable convertible preferred stock — 48,566,655 Issuances upon exercise of warrants to purchase Series A-4, upon conversion to common warrants — 1,836,429 Issuances upon exercise of common stock warrants 24,333,365 1,353,062 Earnout shares 23,482,845 — Total common stock reserved for future issuance 67,816,703 65,242,854 | NOTE 7. STOCKHOLDERS’ DEFICIT Preferred Stock Class A Common Stock Class B Common Stock Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, and any private placement-equivalent warrants issued to the Sponsor or its affiliates upon conversion of loans made to the Company). |
WARRANTS
WARRANTS | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
WARRANTS. | ||
WARRANTS | 13. Warrant Liabilities The following represents a summary of the warrant liabilities activity during the six months ended June 30, 2022: Series A-4 Private Placement Warrants Warrants Total Balance at December 31, 2021 $ 15,821 $ — $ 15,821 Assumed upon Business Combination — 8,140 8,140 Changes in fair value 926 (7,010) (6,084) Conversion and exchange upon Business Combination (16,747) — (16,747) Balance at June 30, 2022 $ — $ 1,130 $ 1,130 Private Placement Warrants At June 30, 2022, 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 June 30, 2022, 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 June 30, 2022: Private Placement Warrants Expected term 4.5 years Expected volatility 62.0 % Expected dividend yield 0.0 % Risk free interest rate 3.0 % Price of Gelesis Common Stock $ 1.55 Exercise price of warrants $ 11.50 Legacy Gelesis Redeemable Preferred Stock Warrants In connection with the Business Combination, Legacy Gelesis redeemable preferred stock warrants were reclassified from liability treatment to equity treatment pursuant to the terms of their exchange (see Note 15). | NOTE 8. WARRANTS As of December 31, 2021 and 2020, there were 13,800,000 Public Warrants outstanding. Public Warrants may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only whole warrants will trade. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination or (b) 12 months from the closing of the Initial Public Offering. The Public Warrants will expire five years after the completion of a Business Combination or earlier upon redemption or liquidation. The Company will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act covering the issuance of the shares of Class A common issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available, subject to the Company satisfying its obligations with respect to registration. No warrant will be exercisable and we will not be obligated to issue shares of Class A common stock upon exercise of a warrant unless Class A common stock issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants. The Company has agreed that as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, the Company will use its best efforts to file with the SEC a registration statement covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants to cause such registration statement to become effective and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during any period when the Company will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. Once the warrants become exercisable, the Company may redeem the Public Warrants: ● in whole and not in part; ● at a price of $0.01 per warrant; ● upon not less than 30 days ’ prior written notice of redemption to each warrant holder; and ● if, and only if, the reported last sale price of the Company’s Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30- trading day period ending three business days before the Company sends the notice of redemption to the warrant holders. If and when the warrants become redeemable by the Company, the Company may not exercise its redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or the Company is unable to effect such registration or qualification. If the Company calls the Public Warrants for redemption, management 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. The exercise price and number of shares of Class A common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, or recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be adjusted for issuance of Class A common stock at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire worthless. In addition, if (x) the Company issues additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per share (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors and, in the case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares held by the sponsor or such affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s common stock during the 20 trading day period starting on the trading day prior to the day on which the Company consummates a Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. As of December 31, 2021 and 2020, there were 7,520,000 Private Placement Warrants outstanding. The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A common stock issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. |
INCOME TAX
INCOME TAX | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
INCOME TAX | 17. Income Taxes The Company did not record a provision during the three months and the six months ended June 30, 2022 and June 30, 2021, respectively. The provision recorded differs from the US statutory rate of 21% for the three months and six months ended June 30, 2022 and June 30, 2021 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 June 30, 2022 and December 31, 2021, respectively. | NOTE 9 — INCOME TAX The Company’s net deferred tax assets are as follows: December 31, December 31, 2021 2020 Deferred tax assets (liabilities) Net operating loss carryforward $ 9,695 $ 36,961 Startup/Organizational expenses 488,923 472,542 Unrealized gain on marketable securities (4,382) (43,985) Total deferred tax assets 494,236 465,518 Valuation allowance (494,236) (465,518) Deferred tax assets, net of valuation allowance $ — $ — The income tax provision for the year ended December 31, 2021 and 2020 consists of the following: December 31, December 31, 2021 2020 Federal Current $ — $ — Deferred (28,719) (465,518) State and Local Current — — Deferred — — Change in valuation allowance 28,719 465,518 Income tax provision $ — $ — As of December 31, 2020 and December 31, 2021, the Company had $176,006 and $46,167 of federal net operating loss carryovers, respectively, which can be carried forward indefinitely, available to offset future taxable income. In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the year ended December 31, 2021, the change in the valuation allowance was $28,719. For the period from July 7, 2020 through December 31, 2020, the change in the valuation allowance was $465,518 . A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2021 and 2020 is as follows: December 31, 2021 December 31, 2020 Statutory federal income tax rate 21.0 % 21.0 % State taxes, net of federal tax benefit 0.0 % 0.0 % Business combination expense (33.19) % — Change in fair value of warrants 12.38 % 0.0 % Transaction costs incurred in connection with warrant liabilities — (0.0) % Valuation allowance (0.19) % (21.0) % Income tax provision 0.0 % 0.0 % The Company files income tax returns in the U.S. federal jurisdiction and is subject to examination by the various taxing authorities. The Company’s tax returns for the year ended December 31, 2021 and 2020 remain open to examination by the taxing authorities. The Company considers Texas to be a significant state tax jurisdiction. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | ||
FAIR VALUE MEASUREMENTS | 4. Fair Value Measurements Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at June 30, 2022 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Earnout liability (See Note 14) $ 6,190 $ — $ — $ 6,190 Private placement warrant liability (see Note 13) 1,130 — — 1,130 One S.r.l. call option (see Note 11) 3,062 — — 3,062 Total liabilities measured at fair value $ 10,382 $ — $ — $ 10,382 Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at December 31, 2021 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Convertible promissory notes (see Note 12) $ 27,128 $ — $ — $ 27,128 Legacy Gelesis preferred stock warrants (See Note 13) 15,821 — — 15,821 One S.r.l. call option (see Note 11) 2,416 — — 2,416 Total liabilities measured at fair value $ 45,365 $ — $ — $ 45,365 The following table presents a summary of the changes in the fair value of the Company’s Level 3 financial instruments during the six months ended June 30, 2022: Legacy Gelesis Redeemable Preferred Convertible Stock Promissory Warrants One S.r.l. Call Earnout Private Placement Notes Liabilities Option Liability Warrant Liability Balance at December 31, 2021 $ 27,128 $ 15,821 $ 2,416 $ — $ — Assumed upon Business Combination — — — — 8,140 Recognized upon Business Combination — — — 58,871 — Changes in fair value 156 926 865 (52,681) (7,010) Foreign currency translation (gain)/loss — — (219) — — Conversion and exchange upon Business Combination — (16,747) — — — Settlement (27,284) — — — — Balance at June 30, 2022 $ — $ — $ 3,062 $ 6,190 $ 1,130 There were no transfers out level | NOTE 10. FAIR VALUE MEASUREMENTS The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at December 31, 2021 and 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: Description Level December 31, 2021 December 31, 2020 Assets Cash and marketable securities held in Trust Account 1 $ 276,207,207 $ 276,209,453 Liabilities: Warrant Liability — Public Warrants 1 $ 8,964,000 $ 19,458,000 Warrant Liability — Private Placement Warrants 3 $ 13,805,441 $ 10,643,808 The Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities in the accompanying consolidated balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the consolidated statements of operations. The measurement of the Public Warrants as of December 31, 2021 and 2020 is classified as Level 1 due to the use of an observable market quote in an active market. Level 3 financial liabilities consist of the Private Placement Warrant liability for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate. The fair value of the Private Placement Warrants was estimated at December 31, 2021 and 2020 to be $1.84 per warrant and $1.42 per warrant, respectively, using the modified Black-Scholes option pricing model and the following assumptions: December 31, 2021 December 31, 2020 Risk free rate 1.26 % 0.47 % Expected term 5.04 5.76 Dividend yield 0.00 % 0.00 % Expected volatility 24.28 % 19.0 % Exercise price $ 11.50 $ 11.50 Unit Price $ 9.96 $ 10.15 The following table presents the changes in the fair value of Level 3 warrant liabilities: Warrant Private Placement Public Liabilities Fair value as of January 1, 2020 $ $ $ Initial measurement on July 7, 2020 (Initial Public Offering) 6,241,600 11,454,000 17,695,600 Transfer to Level 1 — (11,046,900) (11,046,900) Change in fair value 4,402,208 (407,100) 3,995,108 Fair value as of December 31, 2020 $ 10,643,808 $ — $ 10,643,808 Change in fair value 3,161,633 — 3,161,633 Fair value as of December 31, 2021 $ 13,805,441 — $ 13,805,441 Due to the use of quoted prices in an active market (Level 1) to measure the fair value of the Public Warrants, subsequent to initial measurement, the Company had transfers out of Level 3 totaling approximately $11.1 million during the period from July 7, 2020 through December 31, 2020. There were no transfers in or out of Level 3 from other levels in the fair value hierarchy during the year ended December 31, 2021. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Subsequent Events [Abstract] | ||
SUBSEQUENT EVENTS | 21. Subsequent Events The Company has evaluated subsequent events which may require adjustment to or disclosure in the condensed consolidated financial statements through the date of issuance of these condensed consolidated financial statements. Promissory Notes and Promissory Note Warrants On July 25, 2022 and August 4, 2022, the Company issued three term promissory notes in the aggregate principal amount of $25.0 million to existing investor CMS Bridging DMCC, an affiliate of CMS Medical Venture Investment (HK) Limited, and existing investors and related parties PureTech Health LLC and SSD2 LLC, for an aggregate cash purchase price of $25.0 million. Each of the promissory notes is unsecured and bears interest at a rate of 15% per annum or b business days CMS License Agreement Amendment and CMS Warrant On August 4, 2022, the Company entered into an amendment to the License, Collaboration and Supply Agreement, dated June 18, 2020, by and between the Company and CMS Bridging DMCC, an affiliate of CMS Medical Venture Investment (HK) Limited. Pursuant to the amendment, the one-time, non-refundable, and non-creditable regulatory approval milestone payment of $5.0 million provided for in the original agreement became immediately payable. In addition, the amendment expands the CMS Territory and provides that the minimum annual royalty term for CMS territory will commence January 2024 (rather than January 2022, as previously provided under the original agreement) and extend through the expiration date of the amended agreement. Upon execution of the amendment, the Company also issued to CMS a warrant to purchase up to 400,000 shares of common stock, par value $0.0001 per share, at an exercise price of $0.01 per share. The warrant expires on the date that is ten years from the date of issuance and is exercisable at any time from the date of issuance until the expiration date . One S.r.l. Amended Warrant Purchase Agreement On August 9, 2022, the Company entered into an amendment to the Warrant Purchase Agreement dated October 21, 2020, by and between the Company and the One S.r.l. warrantholders. Pursuant to the amendment, the Company deferred payment of the aggregate remaining purchase price under the patent license and assignment agreement and master agreement between the Company and One S.r.l., totaling Pursuant to the amendment, and in consideration for the deferral, the Company amended the exercise price of the One S.r.l. warrantholders’ 1,353,062 previously issued common stock warrants from $4.26 to $1.45. Committed Equity Facility with B. Riley Principal Capital II, LLC On August 11, 2022, the Company entered into a Common Stock Purchase Agreement and a Registration Rights Agreement with B. Riley Principal Capital II, LLC (“B. Riley”). Pursuant to the agreement, the Company will have the right, but not the obligation, to sell to B. Riley up to the lesser of (i) $50,000,000 of newly issued shares of common stock, and (ii) 14,506,475 shares of common stock (which is the number of shares equal to approximately 19.99% of the aggregate number of shares of the Company's common stock issued and outstanding immediately prior to the execution of the agreement), from time to time during the 24-month term set forth in the agreement. | NOTE 11. SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the consolidated financial statements were issued. Based upon this review, other than the below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the consolidated financial statements. On January 13, 2022 the Company completed its Business Combination with Legacy Gelesis. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | ||
Basis of Presentation | Basis of Presentation The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). The Company consolidates those entities where it has a direct and indirect controlling financial interest based on either a variable interest model or voting interest model. 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. The noncontrolling interest attributable to the Company’s VIE is presented as a separate component from stockholders’ equity (deficit) in the condensed consolidated balance sheets and as a noncontrolling interest in the condensed consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholders’ equity. All intercompany balances and transactions have been eliminated in consolidation. Under the variable interest model, a controlling financial interest is determined based on which entity, if any, has (i) the power to direct the activities of the VIE that most significantly impacts the VIE’s economic performance and (ii) the obligations to absorb losses that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. The consolidation status of a VIE may change as a result of such reassessments. Changes in consolidation status are applied prospectively in accordance with U.S. GAAP. | Basis of Presentation The accompanying consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation. | |
Emerging Growth Company | Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s consolidated financial statement with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. | |
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. | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. One of the more significant accounting estimates included in these consolidated financial statements is the determination of the fair value of the warrant liabilities. Such estimates may be subject to change as more current information becomes available and, accordingly, the actual results could differ significantly from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2021 and 2020. | |
Marketable Securities Held in Trust Account | Marketable Securities Held in Trust Account At December 31, 2021 and 2020, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the consolidated balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments held in Trust Account are included in interest earned on marketable securities held in Trust Account in the accompanying consolidated statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. | |
Offering Costs | Offering Costs The Company complies with the requirements of the ASC 340-10-S99-1. Offering costs consisted of legal, accounting, underwriting fees and other costs incurred through the Initial Public Offering that were directly related to the Initial Public Offering. The Company incurred offering costs amounting to $15,851,828 as a result of the Initial Public Offering, consisting of $5,520,000 of underwriting commissions, $9,660,000 of deferred underwriting commissions, and $671,828 of other offering costs. The offering costs were charged to temporary equity and additional paid-in capital upon the completion of the Initial Public Offering. Immediately thereafter, temporary equity was remeasured and an adjustment was recognized through additional paid in capital and accumulated deficit to adjust temporary equity to the redemption value. | |
Warrant Liabilities | Warrant Liabilities The Company accounts for the Public Warrants (as defined in Note 2) and Private Placement Warrants (together with the Public Warrants, the “Warrants”) in accordance with the guidance contained in ASC 815-40, under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrants as liabilities at their fair value and adjusts the Warrants to fair value in respect of each reporting period. This liability is subject to re-measurement at each balance sheet date until the Warrants are exercised, and any change in fair value is recognized in the consolidated statements of operations. The Private Placement Warrants and the Public Warrants for periods where no observable traded price was available are valued using a Monte Carlo simulation. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrants’ quoted market price was used as the fair value as of each relevant date. | |
Class A Common Stock Subject to Possible Redemption | Class A Common Stock Subject to Possible Redemption The Company accounts for its shares of Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s consolidated balance sheets. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable common stock are affected by charges against additional paid-in capital and accumulated deficit. At December 31, 2021 and 2020, the ordinary shares reflected in the consolidated balance sheets are reconciled in the following table: Gross proceeds $ 276,000,000 Less: Proceeds allocated to Public Warrants (11,454,000) Class A common stock issuance costs (15,179,927) Plus: Remeasurement of carrying value to redemption value 26,667,374 Common stock subject to possible redemption, 12/31/20 276,033,447 Remeasurement of carrying value to redemption value (33,447) Common stock subject to possible redemption, 12/31/21 $ 276,000,000 | |
Income Taxes | Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the consolidated financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The effective tax rates differ from the statutory tax rate for the periods presented primarily due to the change in warrant valuation and the valuation allowance recorded on the Company’s net operating losses. ASC 740 prescribes a recognition threshold and a measurement attribute for the consolidated financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. | |
Net Loss Per Common Share | Net Loss Per Common Share The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. The Company has two classes of common stock, which are referred to as Class A common stock and Class B common stock. Income and losses are shared pro rata between the two classes of common stock. Net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. Remeasurement associated with the redeemable shares of Class A common stock is excluded from loss per common share as the redemption value approximates fair value. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 21,320,000 shares in the calculation of diluted loss per share, since the exercise of the warrants is contingent upon the occurrence of future events. As of December 31, 2021 and 2020, the Company did not have any other dilutive securities or other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company. As a result, diluted net loss per common share is the same as basic net loss per common share for the periods presented. The following table reflects the calculation of basic and diluted net loss per common share (in dollars, except per share amounts): For the Period from February 14, 2020 (Inception) Through Year Ended December 31, December 31, 2021 2020 Class A Class B Class A Class B Basic and diluted net loss per common share Numerator: Allocation of net loss, as adjusted $ (10,318,466) $ (2,579,616) $ (10,719,238) $ (4,575,622) Denominator: Basic and diluted weighted average stock outstanding 27,600,000 6,900,000 15,218,692 6,496,262 Basic and diluted net loss per common share $ (0.37) $ (0.37) $ (0.70) $ (0.70) | |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Corporation coverage limit of $250,000. The Company has not experienced losses on this account. | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying consolidated balance sheets, primarily due to their short-term nature. The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. | |
Recent Accounting Standards | Recent Accounting Standards In August 2020, the FASB issued ASU No. 2020-06, “Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s consolidated financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | ||
Schedule of ordinary shares reflected in the condensed consolidated balance sheets | At December 31, 2021 and 2020, the ordinary shares reflected in the consolidated balance sheets are reconciled in the following table: Gross proceeds $ 276,000,000 Less: Proceeds allocated to Public Warrants (11,454,000) Class A common stock issuance costs (15,179,927) Plus: Remeasurement of carrying value to redemption value 26,667,374 Common stock subject to possible redemption, 12/31/20 276,033,447 Remeasurement of carrying value to redemption value (33,447) Common stock subject to possible redemption, 12/31/21 $ 276,000,000 | |
Schedule of Earnings Per Share, Basic and Diluted | Basic and diluted loss per share attributable to common stockholders was calculated as follows: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net loss $ (12,513) $ (24,739) $ (18,216) $ (43,325) Accretion of redeemable convertible preferred stock to redemption value — (82,365) (37,934) (116,126) Accretion of noncontrolling interest put option to redemption value (85) (96) (173) (190) Net loss attributable to common stockholders $ (12,598) $ (107,200) $ (56,323) $ (159,641) Denominator: Weighted average common shares outstanding, basic and diluted 72,423,043 5,589,728 67,609,838 5,592,911 Net loss per share, basic and diluted $ (0.17) $ (19.18) $ (0.83) $ (28.54) | For the Period from February 14, 2020 (Inception) Through Year Ended December 31, December 31, 2021 2020 Class A Class B Class A Class B Basic and diluted net loss per common share Numerator: Allocation of net loss, as adjusted $ (10,318,466) $ (2,579,616) $ (10,719,238) $ (4,575,622) Denominator: Basic and diluted weighted average stock outstanding 27,600,000 6,900,000 15,218,692 6,496,262 Basic and diluted net loss per common share $ (0.37) $ (0.37) $ (0.70) $ (0.70) |
INCOME TAX (Tables)
INCOME TAX (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Company's net deferred tax assets | December 31, December 31, 2021 2020 Deferred tax assets (liabilities) Net operating loss carryforward $ 9,695 $ 36,961 Startup/Organizational expenses 488,923 472,542 Unrealized gain on marketable securities (4,382) (43,985) Total deferred tax assets 494,236 465,518 Valuation allowance (494,236) (465,518) Deferred tax assets, net of valuation allowance $ — $ — |
Schedule of income tax provision | December 31, December 31, 2021 2020 Federal Current $ — $ — Deferred (28,719) (465,518) State and Local Current — — Deferred — — Change in valuation allowance 28,719 465,518 Income tax provision $ — $ — |
Schedule of reconciliation of the federal income tax rate to the Company's effective tax rate | December 31, 2021 December 31, 2020 Statutory federal income tax rate 21.0 % 21.0 % State taxes, net of federal tax benefit 0.0 % 0.0 % Business combination expense (33.19) % — Change in fair value of warrants 12.38 % 0.0 % Transaction costs incurred in connection with warrant liabilities — (0.0) % Valuation allowance (0.19) % (21.0) % Income tax provision 0.0 % 0.0 % |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | ||
Schedule of company's assets that are measured at fair value on a recurring basis | Description Level December 31, 2021 December 31, 2020 Assets Cash and marketable securities held in Trust Account 1 $ 276,207,207 $ 276,209,453 Liabilities: Warrant Liability — Public Warrants 1 $ 8,964,000 $ 19,458,000 Warrant Liability — Private Placement Warrants 3 $ 13,805,441 $ 10,643,808 | |
Summary of Weighted Average Assumptions of Fair Value of Liabilities | Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at June 30, 2022 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Earnout liability (See Note 14) $ 6,190 $ — $ — $ 6,190 Private placement warrant liability (see Note 13) 1,130 — — 1,130 One S.r.l. call option (see Note 11) 3,062 — — 3,062 Total liabilities measured at fair value $ 10,382 $ — $ — $ 10,382 Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at December 31, 2021 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Convertible promissory notes (see Note 12) $ 27,128 $ — $ — $ 27,128 Legacy Gelesis preferred stock warrants (See Note 13) 15,821 — — 15,821 One S.r.l. call option (see Note 11) 2,416 — — 2,416 Total liabilities measured at fair value $ 45,365 $ — $ — $ 45,365 | December 31, 2021 December 31, 2020 Risk free rate 1.26 % 0.47 % Expected term 5.04 5.76 Dividend yield 0.00 % 0.00 % Expected volatility 24.28 % 19.0 % Exercise price $ 11.50 $ 11.50 Unit Price $ 9.96 $ 10.15 |
Schedule of change in the fair value of the warrant liabilities | The following table presents a summary of the changes in the fair value of the Company’s Level 3 financial instruments during the six months ended June 30, 2022: Legacy Gelesis Redeemable Preferred Convertible Stock Promissory Warrants One S.r.l. Call Earnout Private Placement Notes Liabilities Option Liability Warrant Liability Balance at December 31, 2021 $ 27,128 $ 15,821 $ 2,416 $ — $ — Assumed upon Business Combination — — — — 8,140 Recognized upon Business Combination — — — 58,871 — Changes in fair value 156 926 865 (52,681) (7,010) Foreign currency translation (gain)/loss — — (219) — — Conversion and exchange upon Business Combination — (16,747) — — — Settlement (27,284) — — — — Balance at June 30, 2022 $ — $ — $ 3,062 $ 6,190 $ 1,130 | Warrant Private Placement Public Liabilities Fair value as of January 1, 2020 $ $ $ Initial measurement on July 7, 2020 (Initial Public Offering) 6,241,600 11,454,000 17,695,600 Transfer to Level 1 — (11,046,900) (11,046,900) Change in fair value 4,402,208 (407,100) 3,995,108 Fair value as of December 31, 2020 $ 10,643,808 $ — $ 10,643,808 Change in fair value 3,161,633 — 3,161,633 Fair value as of December 31, 2021 $ 13,805,441 — $ 13,805,441 |
DESCRIPTION OF ORGANIZATION A_2
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS - Business Combination (Details) | 6 Months Ended | ||||||||
Jan. 13, 2022 USD ($) $ / shares shares | Jan. 11, 2022 USD ($) $ / shares shares | Dec. 30, 2021 USD ($) $ / shares shares | Jul. 19, 2021 USD ($) $ / shares shares | Jun. 30, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | Dec. 13, 2021 USD ($) item | Dec. 31, 2020 $ / shares shares | Feb. 26, 2020 $ / shares | |
Subsidiary Sale Of Stock [Line Items] | |||||||||
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||||
Total common stock immediately after Closing | 72,552,477 | 6,248,192 | |||||||
Backstop Purchasers | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Aggregate proceeds agreed | $ | $ 15,000,000 | ||||||||
Backstop Purchasers | Exceeded Available Funds [Member] | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Number of shares agreed to purchase | 744,217 | ||||||||
Aggregate proceeds agreed | $ | $ 7,442,170 | ||||||||
Proceeds from sale of shares available funds | $ | $ 15,000,000 | ||||||||
Convertible promissory note | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Number of existing investors | item | 2 | ||||||||
Aggregate amount of note | $ | $ 27,000,000 | ||||||||
Interest rate (as a percent) | 10% | ||||||||
Class A common stock | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Total common stock immediately after Closing | 0 | 0 | |||||||
Class B common stock | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Total common stock immediately after Closing | 6,900,000 | 6,900,000 | |||||||
Gelesis | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Implied equity value | $ | $ 675,000,000 | $ 675,000,000 | |||||||
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||||
Conversion ratio of CPSR Class A or CPSR Class B to CPSR Share | 1 | ||||||||
Shares issued (in shares) | 54,814,847 | ||||||||
Trading price for future vesting threshold of the first third | $ / shares | $ 12.50 | $ 12.50 | |||||||
Trading price for future vesting threshold of the second third | $ / shares | 15 | ||||||||
Trading price for future vesting threshold of the third portion | $ / shares | $ 17.50 | ||||||||
Number of trading days within specified period that share price must exceed | 20 days | 20 days | |||||||
Consecutive trading days used to evaluate share price | 30 days | 30 days | |||||||
Threshold period before share price condition commences | 5 years | 5 years | |||||||
Number of restricted earn out shares entitled | 23,482,845 | 23,483,250 | 23,482,845 | ||||||
Total common stock immediately after Closing | 72,214,287 | ||||||||
Common Stock subject to outstanding equity awards (shares) | 13,486,708 | ||||||||
Gelesis | Backstop Purchasers | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Shares issued (in shares) | 2,727,967 | ||||||||
Gelesis | PIPE Investors | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Shares issued (in shares) | 9,000,000 | ||||||||
Gelesis | Class A common stock | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | ||||||||
Conversion ratio of CPSR Class A or CPSR Class B to CPSR Share | 755,223 | ||||||||
Shares issued (in shares) | 26,844,777 | 9,000,000 | |||||||
Share price | $ / shares | $ 10 | $ 10 | |||||||
Shares issued value | $ | $ 268,646,943 | $ 90,000,000 | |||||||
Gelesis | Class A common stock | Backstop Purchasers | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Shares issued (in shares) | 1,983,750 | ||||||||
Share price | $ / shares | $ 10 | ||||||||
Number of shares agreed to purchase | 1,500,000 | ||||||||
Gelesis | Class B common stock | |||||||||
Subsidiary Sale Of Stock [Line Items] | |||||||||
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | ||||||||
Conversion ratio of CPSR Class A or CPSR Class B to CPSR Share | 4,916,250 |
DESCRIPTION OF ORGANIZATION A_3
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS - Business Prior to the Business Combination (Details) - USD ($) | 11 Months Ended | 12 Months Ended | ||
Jul. 07, 2020 | Dec. 31, 2020 | Dec. 31, 2021 | Jun. 30, 2022 | |
Subsidiary Sale Of Stock [Line Items] | ||||
Unit price | $ 3.35 | |||
Sale of Private Placement Warrants (in shares) | 7,520,000 | 1,353,062 | 24,333,365 | |
Price of single warrant | $ 1 | |||
Proceeds from sale of Private Placement Warrants | $ 7,520,000 | $ 7,520,000 | ||
Transaction Costs | $ 15,851,828 | |||
Underwriting fees | 5,520,000 | |||
Deferred underwriting fees | 9,660,000 | 9,660,000 | ||
Other offering costs | 671,828 | |||
Investment maximum maturity term | 185 days | |||
Cash | 491,827 | 28,397,000 | $ 25,341,000 | |
Operating bank accounts | $ 276,209,453 | 276,207,207 | ||
Working capital deficit | 21,364,028 | |||
Franchise tax payable | $ 207,207 | |||
Initial Public Offering | ||||
Subsidiary Sale Of Stock [Line Items] | ||||
Sale of Units, net of underwriting discounts (in shares) | 27,600,000 | 27,600,000 | ||
Unit price | $ 10 | |||
Proceeds from issuance of units | $ 276,000,000 | |||
Private Placement | ||||
Subsidiary Sale Of Stock [Line Items] | ||||
Sale of Private Placement Warrants (in shares) | 7,520,000 | |||
Price of single warrant | $ 1 | |||
Proceeds from sale of Private Placement Warrants | $ 7,520,000 | |||
Over-allotment option | ||||
Subsidiary Sale Of Stock [Line Items] | ||||
Sale of Units, net of underwriting discounts (in shares) | 3,600,000 | 3,600,000 | ||
Unit price | $ 10 | |||
Deferred underwriting fees | $ 9,660,000 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounting Policies [Abstract] | ||||
Cash equivalents | $ 0 | $ 0 | ||
Unrecognized tax benefits | 0 | |||
Unrecognized tax benefits accrued for interest and penalties | $ 0 | |||
Anti-dilutive securities attributable to warrants (in shares) | 44,333,858 | 65,380,739 | 21,320,000 | |
Cash, FDIC Insured Amount | $ 250,000 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Offering Costs (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Accounting Policies [Abstract] | ||
Transaction Costs | $ 15,851,828 | |
Underwriting fees | 5,520,000 | |
Deferred underwriting fees | 9,660,000 | $ 9,660,000 |
Other offering costs | $ 671,828 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - ordinary shares reflected in the condensed consolidated balance sheets (Details) - USD ($) | 11 Months Ended | 12 Months Ended |
Dec. 31, 2020 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | ||
Gross proceeds | $ 276,000,000 | |
Proceeds allocated to Public Warrants | (11,454,000) | |
Class A common stock issuance costs | (15,179,927) | |
Plus: Remeasurement of carrying value to redemption value | 26,667,374 | $ (33,447) |
Class A common stock subject to possible redemption 27,600,000 shares at redemption value as of December 31, 2021 and 2020 | $ 276,033,447 | $ 276,000,000 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - calculation of basic and diluted net income (loss) per common share ( (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | |
Numerator: | ||||||
Allocation of net income (loss), as adjusted | $ (12,598,000) | $ (107,200,000) | $ (56,323,000) | $ (159,641,000) | ||
Class A common stock | ||||||
Numerator: | ||||||
Allocation of net income (loss), as adjusted | $ (10,719,238) | $ (10,318,466) | ||||
Denominator : | ||||||
Weighted Average Number of Shares Outstanding, Basic | 15,218,692 | 27,600,000 | ||||
Weighted Average Number of Shares Outstanding, Diluted | 15,218,692 | 27,600,000 | ||||
Earnings Per Share, Basic | $ (0.70) | $ (0.37) | ||||
Earnings Per Share, Diluted | $ (0.70) | $ (0.37) | ||||
Class B common stock | ||||||
Numerator: | ||||||
Allocation of net income (loss), as adjusted | $ (4,575,622) | $ (2,579,616) | ||||
Denominator : | ||||||
Weighted Average Number of Shares Outstanding, Basic | 6,496,262 | 6,900,000 | ||||
Weighted Average Number of Shares Outstanding, Diluted | 6,496,262 | 6,900,000 | ||||
Earnings Per Share, Basic | $ (0.70) | $ (0.37) | ||||
Earnings Per Share, Diluted | $ (0.70) | $ (0.37) |
INITIAL PUBLIC OFFERING (Detail
INITIAL PUBLIC OFFERING (Details) - $ / shares | 12 Months Ended | |
Jul. 07, 2020 | Dec. 31, 2021 | |
Subsidiary Sale Of Stock [Line Items] | ||
Number of shares issuable per warrant | 1 | |
Exercise price of warrants | $ 11.50 | |
Initial Public Offering | ||
Subsidiary Sale Of Stock [Line Items] | ||
Sale of Units, net of underwriting discounts (in shares) | 27,600,000 | 27,600,000 |
Price per share | $ 10 | |
Number of shares in a unit | 1 | |
Number of warrants in a unit | 0.5 | |
Number of shares issuable per warrant | 1 | |
Exercise price of warrants | $ 11.50 | |
Over-allotment option | ||
Subsidiary Sale Of Stock [Line Items] | ||
Sale of Units, net of underwriting discounts (in shares) | 3,600,000 | 3,600,000 |
PRIVATE PLACEMENT (Details)
PRIVATE PLACEMENT (Details) - USD ($) | 11 Months Ended | |||
Jul. 07, 2020 | Dec. 31, 2020 | Jun. 30, 2022 | Dec. 31, 2021 | |
PRIVATE PLACEMENT. | ||||
Warrants to purchase common stock | 7,520,000 | 24,333,365 | 1,353,062 | |
Price of warrants | $ 1 | |||
Aggregate purchase price | $ 7,520,000 | $ 7,520,000 | ||
Number of shares per warrant | 1 | |||
Exercise price of warrant | $ 11.50 |
RELATED PARTY TRANSACTIONS - Fo
RELATED PARTY TRANSACTIONS - Founder Shares (Details) | 11 Months Ended | ||
Jul. 01, 2020 D $ / shares shares | Feb. 26, 2020 USD ($) shares | Dec. 31, 2020 USD ($) | |
Related Party Transaction [Line Items] | |||
Issuance of Class B common stock to Sponsor | $ | $ 25,000 | ||
Founder Shares | Sponsor | Class B common stock | |||
Related Party Transaction [Line Items] | |||
Issuance of Class B common stock to Sponsor (in shares) | 5,750,000 | ||
Issuance of Class B common stock to Sponsor | $ | $ 25,000 | ||
Share dividend | 1,150,000 | ||
Aggregate number of shares owned | 6,900,000 | ||
Shares subject to forfeiture | 900,000 | ||
Percentage of issued and outstanding shares after the Initial Public Offering collectively held by initial stockholders | 20% | ||
Threshold period for not to transfer, assign or sell any of their shares or warrants after the completion of the initial business combination | 1 year | ||
Stock price trigger to transfer, assign or sell any shares or warrants of the company, after the completion of the initial business combination (in dollars per share) | $ / shares | $ 12 | ||
Threshold trading days for transfer, assign or sale of shares or warrants, after the completion of the initial business combination | D | 20 | ||
Threshold consecutive trading days for transfer, assign or sale of shares or warrants, after the completion of the initial business combination | D | 30 | ||
Threshold period after the business combination in which the 20 trading days within any 30 trading day period commences | 150 days |
RELATED PARTY TRANSACTIONS - Ad
RELATED PARTY TRANSACTIONS - Additional Information (Details) - USD ($) | 6 Months Ended | 11 Months Ended | 12 Months Ended | |||||
Jul. 07, 2020 | Jul. 01, 2020 | Jun. 30, 2022 | Dec. 31, 2020 | Dec. 31, 2021 | Jul. 28, 2021 | Mar. 03, 2021 | Feb. 14, 2020 | |
Related Party Transaction [Line Items] | ||||||||
Repayment of promissory note - related party | $ 27,284,000 | $ 150,000 | ||||||
Current liabilities - Accounts payable and accrued expenses | $ 9,715,000 | 1,630,832 | $ 13,660,000 | |||||
Administrative Support Agreement | ||||||||
Related Party Transaction [Line Items] | ||||||||
Expenses per month | $ 10,000 | |||||||
Expenses incurred and paid | $ 60,000 | |||||||
Expenses incurred | 120,000 | |||||||
Account payable and accrued expense related to related party | 20,000 | |||||||
Promissory Note with Related Party | ||||||||
Related Party Transaction [Line Items] | ||||||||
Maximum borrowing capacity of related party promissory note | $ 250,000 | |||||||
Repayment of promissory note - related party | $ 140,000 | |||||||
Related Party Loans | ||||||||
Related Party Transaction [Line Items] | ||||||||
Maximum Loans Convertible Into Warrants | $ 1,500,000 | |||||||
Price of warrants (in dollars per share) | $ 1 | |||||||
Loans From Sponsor Working Capital Purpose | $ 1,500,000 | |||||||
Sponsor Loan | ||||||||
Related Party Transaction [Line Items] | ||||||||
Aggregate amount of loan | $ 4,000,000 | |||||||
Amount outstanding | $ 0 |
COMMITMENTS (Details)
COMMITMENTS (Details) | Dec. 31, 2021 USD ($) item $ / shares | Dec. 31, 2020 USD ($) |
Commitments And Contingencies Disclosure [Abstract] | ||
Maximum Number Of Demands For Registration Of Securities | item | 3 | |
Deferred Fee Per Unit | $ / shares | $ 0.35 | |
Deferred underwriting fee payable | $ | $ 9,660,000 | $ 9,660,000 |
STOCKHOLDERS' DEFICIT - Preferr
STOCKHOLDERS' DEFICIT - Preferred Stock Shares (Details) - $ / shares | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Stockholders Equity Note [Abstract] | |||
Preferred shares, shares authorized | 250,000,000 | 1,000,000 | 1,000,000 |
Preferred shares, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Preferred shares, shares issued | 0 | 0 | 0 |
Preferred shares, shares outstanding | 0 | 0 | 0 |
STOCKHOLDERS' DEFICIT - Common
STOCKHOLDERS' DEFICIT - Common Stock Shares (Details) | Jun. 30, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | Dec. 31, 2020 $ / shares shares | Feb. 26, 2020 Vote $ / shares shares |
Class of Stock [Line Items] | ||||
Common shares, shares authorized (in shares) | 900,000,000 | 125,961,571 | ||
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | ||
Common shares, shares issued (in shares) | 72,552,477 | 6,248,192 | ||
Total common stock immediately after Closing | 72,552,477 | 6,248,192 | ||
Class A common stock | ||||
Class of Stock [Line Items] | ||||
Common shares, shares authorized (in shares) | 100,000,000 | 100,000,000 | 100,000,000 | |
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Common shares, votes per share | Vote | 1 | |||
Common shares, shares issued (in shares) | 0 | 0 | ||
Total common stock immediately after Closing | 0 | 0 | ||
Class A common stock subject to possible redemption, issued (in shares) | 27,600,000 | 27,600,000 | ||
Temporary equity, shares outstanding | 27,600,000 | 27,600,000 | ||
Class B common stock | ||||
Class of Stock [Line Items] | ||||
Common shares, shares authorized (in shares) | 10,000,000 | 10,000,000 | 10,000,000 | |
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Common shares, votes per share | Vote | 1 | |||
Common shares, shares issued (in shares) | 6,900,000 | 6,900,000 | ||
Total common stock immediately after Closing | 6,900,000 | 6,900,000 | ||
Threshold conversion ratio of stock | 20% |
WARRANTS (Details)
WARRANTS (Details) | 12 Months Ended | ||
Dec. 31, 2021 D item $ / shares shares | Dec. 31, 2020 shares | Jun. 30, 2022 shares | |
Warrant [Member] | |||
Class Of Warrant Or Right [Line Items] | |||
Public Warrants exercisable term after the completion of a business combination | 30 days | 30 days | |
Public Warrants exercisable term from the closing of the initial public offering | 12 months | 12 months | |
Public Warrants expiration term | 5 years | 5 years | |
Threshold period for filling registration statement after business combination | 15 days | ||
Threshold issue price for capital raising purposes in connection with the closing of a Business Combination | $ / shares | $ 9.20 | ||
Percentage of gross proceeds on total equity proceeds | 60% | ||
Threshold trading days for calculating Market Value | item | 20 | ||
Adjustment of exercise price of warrants based on market value and newly issued price (as a percent) | 115% | ||
Adjustment two of redemption price of stock based on market value and newly issued price (as a percent) | 180% | ||
Threshold period for not to transfer, assign or sell any of their shares or warrants after the completion of the initial business combination | 30 days | 30 days | |
Warrant [Member] | Redemption of Warrants When the Price per Class A Ordinary Share Equals or Exceeds $18.00 | |||
Class Of Warrant Or Right [Line Items] | |||
Stock price trigger for redemption of public warrants (in dollars per share) | $ / shares | $ 18 | ||
Redemption price per public warrant (in dollars per share) | $ / shares | $ 0.01 | ||
Minimum threshold written notice period for redemption of public warrants | D | 30 | ||
Threshold trading days for redemption of public warrants | D | 20 | ||
Threshold number of business days before sending notice of redemption to warrant holders | D | 3 | ||
Redemption period | 30 days | ||
Private Placement Warrants | |||
Class Of Warrant Or Right [Line Items] | |||
Number of warrants outstanding | shares | 7,520,000 | 7,520,000 | 7,520,000 |
Public Warrants | |||
Class Of Warrant Or Right [Line Items] | |||
Number of warrants outstanding | shares | 13,800,000 | 13,800,000 | 13,800,000 |
INCOME TAX - Net deferred tax a
INCOME TAX - Net deferred tax assets (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets (liabilities) | ||
Net operating loss carryforward | $ 9,695 | $ 36,961 |
Startup/Organizational expenses | 488,923 | 472,542 |
Unrealized gain on marketable securities | (4,382) | (43,985) |
Total deferred tax assets | 494,236 | 465,518 |
Valuation Allowance | (494,236) | (465,518) |
Deferred tax assets, net of valuation allowance | $ 0 | $ 0 |
INCOME TAX - Income tax provisi
INCOME TAX - Income tax provision (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2021 | |
Federal | |||||||
Deferred | $ (465,518) | $ (28,719) | |||||
Change in valuation allowance | $ 5,783,000 | 465,518 | 28,719 | ||||
Income tax provision | $ 0 | $ 0 | $ 0 | $ 17,000 | $ 0 | $ 0 |
INCOME TAX - Additional Informa
INCOME TAX - Additional Information (Details) - USD ($) | 6 Months Ended | 11 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
U.S. federal net operating loss carryovers | $ 176,006 | $ 46,167 | |
Change in valuation allowance | $ 5,783,000 | $ 465,518 | $ 28,719 |
INCOME TAX - Reconciliation of
INCOME TAX - Reconciliation of federal income tax rate (Details) | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||||||
Statutory federal income tax rate | 21% | 21% | 21% | 21% | 21% | 21% |
State taxes, net of federal tax benefit | 0% | 0% | ||||
Business combination expense | (33.19%) | |||||
Change in fair value of warrants | 0% | 12.38% | ||||
Transaction costs incurred in connection with warrant liabilities | 0% | |||||
Valuation allowance | (21.00%) | (0.19%) | ||||
Income tax provision | 0% | 0% |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Liabilities: | ||
Private placement warrant liability (see Note 13) | $ 22,499,441 | $ 30,101,808 |
Level 1 | Fair Value Measurements Recurring [Member] | ||
Assets: | ||
Cash and marketable securities held in Trust Account | 276,207,207 | 276,209,453 |
Level 1 | Fair Value Measurements Recurring [Member] | Public Warrants | ||
Liabilities: | ||
Private placement warrant liability (see Note 13) | 8,964,000 | 19,458,000 |
Fair Value Inputs Level3 [Member] | Fair Value Measurements Recurring [Member] | Private Placement Warrants | ||
Liabilities: | ||
Private placement warrant liability (see Note 13) | $ 13,805,441 | $ 10,643,808 |
FAIR VALUE MEASUREMENTS - Initi
FAIR VALUE MEASUREMENTS - Initial Measurement and Subsequent Measurement (Details) | 12 Months Ended | |
Dec. 31, 2021 USD ($) $ / shares Y | Dec. 31, 2020 Y $ / shares | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Fair value per warrant | $ 1.84 | $ 1.42 |
Fair value assets transferred into (out of) level 3 | $ | $ 0 | |
Black Scholes Merton model | Measurement Input Risk Free Interest Rate [Member] | Fair Value Inputs Level3 [Member] | Private Placement Warrants | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 1.26 | 0.47 |
Black Scholes Merton model | Measurement Input, Maturity [Member] | Fair Value Inputs Level3 [Member] | Private Placement Warrants | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | Y | 5.04 | 5.76 |
Black Scholes Merton model | Measurement Input Expected Dividend Rate [Member] | Fair Value Inputs Level3 [Member] | Private Placement Warrants | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0 | 0 |
Black Scholes Merton model | Measurement Input Price Volatility [Member] | Fair Value Inputs Level3 [Member] | Private Placement Warrants | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 24.28 | 19 |
Black Scholes Merton model | Measurement Input Exercise Price [Member] | Fair Value Inputs Level3 [Member] | Private Placement Warrants | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 11.50 | 11.50 |
Black Scholes Merton model | Unit Price | Fair Value Inputs Level3 [Member] | Private Placement Warrants | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 9.96 | 10.15 |
FAIR VALUE MEASUREMENTS - Chang
FAIR VALUE MEASUREMENTS - Changes in the fair value of warrant liabilities (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Beginning balance | $ 15,821,000 | |||
Transfers to Level 1 | $ 0 | |||
Change in fair value | (6,084,000) | |||
Ending balance | 1,130,000 | $ 15,821,000 | ||
Private Placement Warrants | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Beginning balance | 13,805,441 | 10,643,808 | 10,643,808 | |
Initial measurement on July 7, 2020 (Initial Public Offering) | $ 6,241,600 | |||
Change in fair value | 4,402,208 | 3,161,633 | ||
Ending balance | 10,643,808 | 13,805,441 | ||
Public Warrants | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Initial measurement on July 7, 2020 (Initial Public Offering) | 11,454,000 | |||
Transfers to Level 1 | (11,046,900) | |||
Change in fair value | (407,100) | |||
Public Warrants | Fair Value Inputs Level3 [Member] | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Transfers to Level 1 | 11,100,000 | |||
Warrant Liabilities | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Beginning balance | $ 13,805,441 | $ 10,643,808 | 10,643,808 | |
Initial measurement on July 7, 2020 (Initial Public Offering) | 17,695,600 | |||
Transfers to Level 1 | (11,046,900) | |||
Change in fair value | 3,995,108 | 3,161,633 | ||
Ending balance | $ 10,643,808 | $ 13,805,441 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 25,341,000 | $ 28,397,000 |
Accounts receivable | 1,256,000 | 731,000 |
Grants receivable | 9,480,000 | 9,172,000 |
Inventories | 18,821,000 | 13,503,000 |
Prepaid expenses and other current assets | 6,753,000 | 14,203,000 |
Total current assets | 61,651,000 | 66,006,000 |
Property and equipment, net | 56,305,000 | 58,515,000 |
Operating lease right-of-use assets | 1,725,000 | 2,016,000 |
Intangible assets, net | 14,547,000 | 15,680,000 |
Other assets | 4,741,000 | 4,084,000 |
Total assets | 138,969,000 | 146,301,000 |
Current liabilities: | ||
Accounts payable, including due to related party of $303 and $147, respectively | 22,135,000 | 10,066,000 |
Accrued expenses and other current liabilities, including due to related party of $2,791 and $5,664 respectively | 9,715,000 | 13,660,000 |
Deferred income | 33,702,000 | 32,370,000 |
Operating lease liabilities | 550,000 | 541,000 |
Convertible promissory notes due to related party, held at fair value | 27,128,000 | |
Notes payable | 3,177,000 | 1,950,000 |
Warrant liabilities | 15,821,000 | |
Total current liabilities | 69,279,000 | 101,536,000 |
Deferred income | 9,040,000 | 8,914,000 |
Operating lease liabilities | 1,222,000 | 1,519,000 |
Notes payable, including due to related party of $15,223 and $16,523, respectively | 30,015,000 | 35,131,000 |
Warrant liabilities | 1,130,000 | |
Earnout liability | 6,190,000 | |
Other long-term liabilities, including due to related party of $3,062 and $2,416, respectively | 5,908,000 | 5,588,000 |
Total liabilities | 122,784,000 | 152,688,000 |
Commitments and contingencies (Note 19) | ||
Noncontrolling interest | 11,087,000 | 11,855,000 |
Stockholders' equity (deficit): | ||
Preferred stock, $0.0001 par value - 250,000,000 shares authorized at June 30, 2022; zero shares issued and outstanding at June 30, 2022 and December 31, 2021 | ||
Common stock, $0.0001 par value - 900,000,000 shares authorized at June 30, 2022; 72,552,477 shares issued and outstanding at June 30, 2022; 125,961,571 shares authorized at December 31, 2021; 6,248,192 shares issued and outstanding at December 31, 2021 | 7,000 | 1,000 |
Additional paid-in capital | 289,332,000 | (64,549,000) |
Accumulated other comprehensive (loss) income | (344,000) | 219,000 |
Accumulated deficit | (283,896,000) | (265,507,000) |
Total stockholders' equity (deficit) | 5,098,000 | (329,836,000) |
Total liabilities, noncontrolling interest, redeemable convertible preferred stock and stockholders' equity (deficit) | $ 138,969,000 | 146,301,000 |
Legacy Gelesis Redeemable Convertible Preferred Stock | ||
Current liabilities: | ||
Legacy Gelesis redeemable convertible preferred stock, $0.0001 par value - zero shares issued and outstanding at June 30, 2022; 51,730,762 shares authorized at December 31, 2021; and 48,566,655 shares issued and outstanding at December 31, 2021 | $ 311,594,000 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Accounts payable, due to related party | $ 303 | $ 147 |
Accrued expenses and other liabilities, due to related parties | 2,791 | 5,664 |
Notes payable, due to related party | 15,223 | 16,523 |
Other long-term liabilities noncurrent, due to related party | $ 3,062 | $ 2,416 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 900,000,000 | 125,961,571 |
Common stock, shares issued | 72,552,477 | 6,248,192 |
Common stock, shares outstanding | 72,552,477 | 6,248,192 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 250,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Legacy Gelesis Redeemable Convertible Preferred Stock | ||
Temporary equity, par value | $ 0.0001 | $ 0.0001 |
Temporary equity, shares authorized | 51,730,762 | |
Temporary equity, shares issued | 0 | 48,566,655 |
Temporary equity, shares outstanding | 0 | 48,566,655 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenue: | ||||
Total revenue, net | $ 8,973,000 | $ 2,178,000 | $ 16,487,000 | $ 5,279,000 |
Operating expenses: | ||||
Costs of goods sold, including related party expenses of $359 and $87, respectively, and $659 and $211, respectively | 4,786,000 | 2,005,000 | 9,699,000 | 4,821,000 |
Selling, general and administrative, including related party expenses of $125 and $123, respectively, and $250 and $246, respectively | 32,450,000 | 13,972,000 | 70,156,000 | 25,917,000 |
Research and development, including related party expenses of $57 and $64, respectively, and $119 and $130, respectively | 5,523,000 | 5,592,000 | 12,933,000 | 9,968,000 |
Amortization of intangible assets | 566,000 | 566,000 | 1,133,000 | 1,133,000 |
Total operating expenses | 43,325,000 | 22,135,000 | 93,921,000 | 41,839,000 |
Loss from operations | (34,352,000) | (19,957,000) | (77,434,000) | (36,560,000) |
Change in the fair value of earnout liability | 18,812,000 | 52,681,000 | ||
Change in the fair value of convertible promissory notes | (156,000) | |||
Change in the fair value of warrants | 2,600,000 | (4,977,000) | 6,084,000 | (7,051,000) |
Interest expense, net | (186,000) | (227,000) | (321,000) | (588,000) |
Other income, net | 613,000 | 422,000 | 930,000 | 891,000 |
Loss before income taxes | (12,513,000) | (24,739,000) | (18,216,000) | (43,308,000) |
Provision for income taxes | 0 | 0 | 0 | 17,000 |
Net loss | (12,513,000) | (24,739,000) | (18,216,000) | (43,325,000) |
Accretion of Legacy Gelesis senior preferred stock to redemption value | (82,365,000) | (37,934,000) | (116,126,000) | |
Accretion of noncontrolling interest put option to redemption value | (85,000) | (96,000) | (173,000) | (190,000) |
Net loss attributable to common stockholders | $ (12,598,000) | $ (107,200,000) | $ (56,323,000) | $ (159,641,000) |
Net loss per share attributable to common stockholders - basic and diluted | $ (0.17) | $ (19.18) | $ (0.83) | $ (28.54) |
Weighted average common shares outstanding - basic and diluted | 72,423,043 | 5,589,728 | 67,609,838 | 5,592,911 |
Product Revenue, Net | ||||
Revenue: | ||||
Total revenue, net | $ 8,973,000 | $ 2,178,000 | $ 16,487,000 | $ 5,279,000 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (PARENTHETICAL) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Income Statement [Abstract] | ||||
Cost of goods sold, related party expense | $ 359 | $ 87 | $ 659 | $ 211 |
Selling, general and administrative, related party expense | 125 | 123 | 250 | 246 |
Research and development, related party expense | $ 57 | $ 64 | $ 119 | $ 130 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net loss | $ (12,513,000) | $ (24,739,000) | $ (18,216,000) | $ (43,325,000) |
Other comprehensive (loss) income: | ||||
Foreign currency translation adjustment | (426,000) | 43,000 | (564,000) | (368,000) |
Total other comprehensive (loss) income | (426,000) | 43,000 | (564,000) | (368,000) |
Comprehensive loss | $ (12,939,000) | $ (24,696,000) | $ (18,780,000) | $ (43,693,000) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF NONCONTROLLING INTEREST, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) | Noncontrolling Interest [Member] Previously Reported | Noncontrolling Interest [Member] | Common Stock Previously Reported | Common Stock Retroactive Application of Recapitalization | Common Stock | Additional Paid-in Capital Previously Reported | Additional Paid-in Capital | Accumulated Other Comprehensive (Loss) Income Previously Reported | Accumulated Other Comprehensive (Loss) Income | Accumulated Deficit Previously Reported | Accumulated Deficit | Legacy Gelesis Redeemable Convertible Preferred Stock Previously Reported | Legacy Gelesis Redeemable Convertible Preferred Stock Retroactive Application of Recapitalization | Legacy Gelesis Redeemable Convertible Preferred Stock | Previously Reported | Total |
Balance at Dec. 31, 2020 | $ 1,000 | $ 1,000 | $ 23,907,000 | $ 23,907,000 | $ 938,000 | $ 938,000 | $ (171,784,000) | $ (171,784,000) | $ (146,938,000) | $ (146,938,000) | ||||||
Temporary Equity Balance at Dec. 31, 2020 | $ 12,429,000 | $ 12,429,000 | $ 213,525,000 | $ 213,525,000 | ||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2020 | 18,446,525 | 29,367,421 | 47,813,946 | |||||||||||||
Balance, shares at Dec. 31, 2020 | 2,155,490 | 3,431,604 | 5,587,094 | |||||||||||||
Accretion of Legacy Gelesis senior preferred stock to redemption value | (33,761,000) | (33,761,000) | ||||||||||||||
Temporary Equity, Accretion of Legacy Gelesis senior preferred stock to redemption value | $ 33,761,000 | |||||||||||||||
Temporary Equity, Exercise of Legacy Gelesis preferred stock warrants | $ 2,997,000 | |||||||||||||||
Temporary Equity, Exercise of Legacy Gelesis preferred stock warrants, shares | 752,709 | |||||||||||||||
Stock based compensation expense | 1,455,000 | 1,455,000 | ||||||||||||||
Issuance of Legacy Gelesis common stock up exercise of stock options | 4,000 | 4,000 | ||||||||||||||
Issuance of Legacy Gelesis common stock up exercise of stock options, shares | 2,634,000 | |||||||||||||||
Accretion of noncontrolling interest put option to redemption value | (94,000) | (94,000) | ||||||||||||||
Temporary Equity, Accretion of noncontrolling interest put option to redemption value | 94,000 | |||||||||||||||
Foreign currency translation adjustment | (411,000) | (411,000) | ||||||||||||||
Temporary Equity, Foreign currency translation adjustment | (546,000) | |||||||||||||||
Net loss | (18,586,000) | (18,586,000) | ||||||||||||||
Balance at Mar. 31, 2021 | $ 1,000 | (8,395,000) | 527,000 | (190,464,000) | (198,331,000) | |||||||||||
Temporary Equity Balance at Mar. 31, 2021 | 11,977,000 | $ 250,283,000 | ||||||||||||||
Temporary Equity Balance, shares at Mar. 31, 2021 | 48,566,655 | |||||||||||||||
Balance, shares at Mar. 31, 2021 | 5,589,728 | |||||||||||||||
Balance at Dec. 31, 2020 | $ 1,000 | $ 1,000 | 23,907,000 | 23,907,000 | 938,000 | 938,000 | (171,784,000) | (171,784,000) | (146,938,000) | (146,938,000) | ||||||
Temporary Equity Balance at Dec. 31, 2020 | 12,429,000 | 12,429,000 | $ 213,525,000 | $ 213,525,000 | ||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2020 | 18,446,525 | 29,367,421 | 47,813,946 | |||||||||||||
Balance, shares at Dec. 31, 2020 | 2,155,490 | 3,431,604 | 5,587,094 | |||||||||||||
Net loss | (43,325,000) | |||||||||||||||
Balance at Jun. 30, 2021 | $ 1,000 | (89,116,000) | 570,000 | (215,299,000) | (303,844,000) | |||||||||||
Temporary Equity Balance at Jun. 30, 2021 | 12,225,000 | $ 333,585,000 | ||||||||||||||
Temporary Equity Balance, shares at Jun. 30, 2021 | 48,566,655 | |||||||||||||||
Balance, shares at Jun. 30, 2021 | 5,615,192 | |||||||||||||||
Balance at Dec. 31, 2020 | $ 1,000 | $ 1,000 | 23,907,000 | 23,907,000 | 938,000 | 938,000 | (171,784,000) | (171,784,000) | (146,938,000) | (146,938,000) | ||||||
Temporary Equity Balance at Dec. 31, 2020 | 12,429,000 | 12,429,000 | $ 213,525,000 | $ 213,525,000 | ||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2020 | 18,446,525 | 29,367,421 | 47,813,946 | |||||||||||||
Balance, shares at Dec. 31, 2020 | 2,155,490 | 3,431,604 | 5,587,094 | |||||||||||||
Net loss | (12,898,082) | (12,898,082) | ||||||||||||||
Balance at Dec. 31, 2021 | $ 1,000 | $ 1,000 | (64,549,000) | (64,549,000) | 219,000 | 219,000 | (265,507,000) | (265,507,000) | (329,836,000) | (329,836,000) | ||||||
Temporary Equity Balance at Dec. 31, 2021 | 11,855,000 | 11,855,000 | $ 311,594,000 | $ 311,594,000 | ||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2021 | 18,736,936 | 29,829,719 | 48,566,655 | |||||||||||||
Balance, shares at Dec. 31, 2021 | 2,410,552 | 3,837,640 | 6,248,192 | |||||||||||||
Balance at Mar. 31, 2021 | $ 1,000 | (8,395,000) | 527,000 | (190,464,000) | (198,331,000) | |||||||||||
Temporary Equity Balance at Mar. 31, 2021 | 11,977,000 | $ 250,283,000 | ||||||||||||||
Temporary Equity Balance, shares at Mar. 31, 2021 | 48,566,655 | |||||||||||||||
Balance, shares at Mar. 31, 2021 | 5,589,728 | |||||||||||||||
Accretion of Legacy Gelesis senior preferred stock to redemption value | (82,365,000) | $ 82,365,000 | (82,365,000) | |||||||||||||
Temporary Equity, Exercise of Legacy Gelesis preferred stock warrants | 937,000 | |||||||||||||||
Stock based compensation expense | 1,639,000 | 1,639,000 | ||||||||||||||
Issuance of Legacy Gelesis common stock up exercise of stock options | 5,000 | 5,000 | ||||||||||||||
Issuance of Legacy Gelesis common stock up exercise of stock options, shares | 25,464,000 | |||||||||||||||
Accretion of noncontrolling interest put option to redemption value | (96,000) | (96,000) | ||||||||||||||
Temporary Equity, Accretion of noncontrolling interest put option to redemption value | 96,000 | |||||||||||||||
Foreign currency translation adjustment | 43,000 | 43,000 | ||||||||||||||
Temporary Equity, Foreign currency translation adjustment | 152,000 | |||||||||||||||
Net loss | (24,739,000) | (24,739,000) | ||||||||||||||
Balance at Jun. 30, 2021 | $ 1,000 | (89,116,000) | 570,000 | (215,299,000) | (303,844,000) | |||||||||||
Temporary Equity Balance at Jun. 30, 2021 | 12,225,000 | $ 333,585,000 | ||||||||||||||
Temporary Equity Balance, shares at Jun. 30, 2021 | 48,566,655 | |||||||||||||||
Balance, shares at Jun. 30, 2021 | 5,615,192 | |||||||||||||||
Balance at Dec. 31, 2021 | $ 1,000 | $ 1,000 | (64,549,000) | (64,549,000) | 219,000 | 219,000 | (265,507,000) | (265,507,000) | (329,836,000) | (329,836,000) | ||||||
Temporary Equity Balance at Dec. 31, 2021 | 11,855,000 | 11,855,000 | $ 311,594,000 | $ 311,594,000 | ||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2021 | 18,736,936 | 29,829,719 | 48,566,655 | |||||||||||||
Balance, shares at Dec. 31, 2021 | 2,410,552 | 3,837,640 | 6,248,192 | |||||||||||||
Accretion of Legacy Gelesis senior preferred stock to redemption value prior to Business Combination | (37,934,000) | (37,934,000) | ||||||||||||||
Temporary Equity, Accretion of Legacy Gelesis senior preferred stock to redemption value prior to Business Combination | $ 37,934,000 | |||||||||||||||
Conversion of Legacy Gelesis convertible preferred stock into common stock upon Business Combination | 349,528,000 | 349,528,000 | ||||||||||||||
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 | $ (349,528,000) | |||||||||||||||
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 (Note 3) | $ 6,000 | 70,472,000 | 70,478,000 | |||||||||||||
Proceeds from Business Combination, net of issuance costs and assumed liabilities (Note 3), shares | 17,399,440 | |||||||||||||||
Conversion of Legacy Gelesis preferred stock warrants into common stock warrants upon Business Combination | 16,747,000 | 16,747,000 | ||||||||||||||
Recognition of earnout liability upon Business Combination | (58,871,000) | (58,871,000) | ||||||||||||||
Assumed private placement warrant liability upon Business Combination | (8,140,000) | (8,140,000) | ||||||||||||||
Stock based compensation expense | 13,989,000 | 13,989,000 | ||||||||||||||
Exercise of warrants | 4,000 | 4,000 | ||||||||||||||
Exercise of warrants, shares | 176,126 | |||||||||||||||
Accretion of noncontrolling interest put option to redemption value | (88,000) | (88,000) | ||||||||||||||
Temporary Equity, Accretion of noncontrolling interest put option to redemption value | 88,000 | |||||||||||||||
Foreign currency translation adjustment | (137,000) | (137,000) | ||||||||||||||
Temporary Equity, Foreign currency translation adjustment | (239,000) | |||||||||||||||
Net loss | (5,703,000) | (5,703,000) | ||||||||||||||
Balance at Mar. 31, 2022 | $ 7,000 | 281,246,000 | 82,000 | (271,298,000) | 10,037,000 | |||||||||||
Temporary Equity Balance at Mar. 31, 2022 | 11,704,000 | |||||||||||||||
Balance, shares at Mar. 31, 2022 | 72,390,413 | |||||||||||||||
Balance at Dec. 31, 2021 | $ 1,000 | $ 1,000 | $ (64,549,000) | (64,549,000) | $ 219,000 | 219,000 | $ (265,507,000) | (265,507,000) | $ (329,836,000) | (329,836,000) | ||||||
Temporary Equity Balance at Dec. 31, 2021 | $ 11,855,000 | 11,855,000 | $ 311,594,000 | $ 311,594,000 | ||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2021 | 18,736,936 | 29,829,719 | 48,566,655 | |||||||||||||
Balance, shares at Dec. 31, 2021 | 2,410,552 | 3,837,640 | 6,248,192 | |||||||||||||
Net loss | (18,216,000) | |||||||||||||||
Balance at Jun. 30, 2022 | $ 7,000 | 289,332,000 | (344,000) | (283,896,000) | 5,098,000 | |||||||||||
Temporary Equity Balance at Jun. 30, 2022 | 11,087,000 | |||||||||||||||
Temporary Equity Balance, shares at Jun. 30, 2022 | 0 | |||||||||||||||
Balance, shares at Jun. 30, 2022 | 72,552,477 | |||||||||||||||
Balance at Mar. 31, 2022 | $ 7,000 | 281,246,000 | 82,000 | (271,298,000) | 10,037,000 | |||||||||||
Temporary Equity Balance at Mar. 31, 2022 | 11,704,000 | |||||||||||||||
Balance, shares at Mar. 31, 2022 | 72,390,413 | |||||||||||||||
Stock based compensation expense | 7,976,000 | 7,976,000 | ||||||||||||||
Issuance of Legacy Gelesis common stock up exercise of stock options | $ 0 | 110,000 | 110,000 | |||||||||||||
Issuance of Legacy Gelesis common stock up exercise of stock options, shares | 162,064,000 | |||||||||||||||
Accretion of noncontrolling interest put option to redemption value | (85,000) | (85,000) | ||||||||||||||
Temporary Equity, Accretion of noncontrolling interest put option to redemption value | 85,000 | |||||||||||||||
Foreign currency translation adjustment | (426,000) | (426,000) | ||||||||||||||
Temporary Equity, Foreign currency translation adjustment | (702,000) | |||||||||||||||
Net loss | (12,513,000) | (12,513,000) | ||||||||||||||
Balance at Jun. 30, 2022 | $ 7,000 | $ 289,332,000 | $ (344,000) | $ (283,896,000) | $ 5,098,000 | |||||||||||
Temporary Equity Balance at Jun. 30, 2022 | $ 11,087,000 | |||||||||||||||
Temporary Equity Balance, shares at Jun. 30, 2022 | 0 | |||||||||||||||
Balance, shares at Jun. 30, 2022 | 72,552,477 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (18,216,000) | $ (43,325,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization of intangible assets | 1,133,000 | 1,133,000 |
Reduction in carrying amount of right-of-use assets | 265,000 | 150,000 |
Depreciation | 1,440,000 | 358,000 |
Stock-based compensation | 21,965,000 | 3,094,000 |
Unrealized loss (gain) on foreign currency transactions | 672,000 | (28,000) |
Non-cash interest (income) expense | (3,000) | 36,000 |
Accretion on marketable securities | (1,000) | |
Change in the fair value of earnout liability | (52,681,000) | |
Change in the fair value of warrants | (6,084,000) | 7,051,000 |
Change in the fair value of convertible promissory notes | 156,000 | |
Change in fair value of One S.r.l. call option | 865,000 | 554,000 |
Changes in operating assets and liabilities: | ||
Account receivables | (1,473,000) | 640,000 |
Grants receivable | (1,078,000) | (675,000) |
Prepaid expenses and other current assets | 5,048,000 | (7,685,000) |
Inventories | (5,258,000) | (156,000) |
Other assets | (536,000) | (3,281,000) |
Accounts payable | 11,486,000 | (2,374,000) |
Accrued expenses and other current liabilities | 571,000 | 8,211,000 |
Operating lease liabilities | (263,000) | (144,000) |
Deferred income | 2,300,000 | 7,048,000 |
Other long-term liabilities | (81,000) | (5,975,000) |
Net cash used in operating activities | (39,772,000) | (35,369,000) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (5,067,000) | (10,057,000) |
Maturities of marketable securities | 24,000,000 | |
Net cash (used in) provided by investing activities | (5,067,000) | 13,943,000 |
Cash flows from financing activities: | ||
Proceeds from Business Combination, net of transaction costs | 70,478,000 | |
Principal repayment of notes payable | (1,119,000) | (226,000) |
Repayment of convertible promissory notes due to related party, held at fair value | (27,284,000) | |
Proceeds from issuance of promissory notes (net of issuance costs of $0 and $30, respectively) | 4,540,000 | |
Proceeds from the exercise of warrants | 4,000 | 9,000 |
Proceeds from exercise of share-based awards | 110,000 | 10,000 |
Net cash provided by financing activities | 42,189,000 | 4,333,000 |
Effect of exchange rates on cash | (406,000) | (680,000) |
Net decrease in cash | (3,056,000) | (17,773,000) |
Cash and cash equivalents at beginning of year | 28,397,000 | 48,144,000 |
Cash and cash equivalents at end of period | 25,341,000 | 30,371,000 |
Noncash investing and financing activities: | ||
Purchases of property and equipment included in accounts payable and accrued expense | 1,027,000 | 1,217,000 |
Deferred financing costs included in accounts payable and accrued expense | 506,000 | |
Recognition of earnout liability | 58,871,000 | |
Recognition of private placement warrant liability | 8,140,000 | |
Supplemental cash flow information: | ||
Interest paid on notes payable | $ 181,000 | $ 158,000 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (PARENTHETICAL) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Statement Of Cash Flows [Abstract] | ||
Payment of issuance costs | $ 0 | $ 30 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | ||
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). The Company consolidates those entities where it has a direct and indirect controlling financial interest based on either a variable interest model or voting interest model. 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. The noncontrolling interest attributable to the Company’s VIE is presented as a separate component from stockholders’ equity (deficit) in the condensed consolidated balance sheets and as a noncontrolling interest in the condensed consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholders’ equity. All intercompany balances and transactions have been eliminated in consolidation. Under the variable interest model, a controlling financial interest is determined based on which entity, if any, has (i) the power to direct the activities of the VIE that most significantly impacts the VIE’s economic performance and (ii) the obligations to absorb losses that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. The consolidation status of a VIE may change as a result of such reassessments. Changes in consolidation status are applied prospectively in accordance with U.S. GAAP. 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. Fair Value of Financial Instruments The guidance in FASB ASC 820, Fair Value Measurements and Disclosures 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, and call option liability 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: 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: One S.r.l. Call Option: 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 Effective January 1, 2020, the Company accounts for all stock-based compensation awards granted to employees and non-employees in accordance with ASC 718, Compensation – Stock Compensation ● 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. Since the adoption of ASU 2018-07 on January 1, 2020, 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. | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation. Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s consolidated financial statement with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. One of the more significant accounting estimates included in these consolidated financial statements is the determination of the fair value of the warrant liabilities. Such estimates may be subject to change as more current information becomes available and, accordingly, the actual results could differ significantly from those estimates. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2021 and 2020. Marketable Securities Held in Trust Account At December 31, 2021 and 2020, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the consolidated balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments held in Trust Account are included in interest earned on marketable securities held in Trust Account in the accompanying consolidated statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. Offering Costs The Company complies with the requirements of the ASC 340-10-S99-1. Offering costs consisted of legal, accounting, underwriting fees and other costs incurred through the Initial Public Offering that were directly related to the Initial Public Offering. The Company incurred offering costs amounting to $15,851,828 as a result of the Initial Public Offering, consisting of $5,520,000 of underwriting commissions, $9,660,000 of deferred underwriting commissions, and $671,828 of other offering costs. The offering costs were charged to temporary equity and additional paid-in capital upon the completion of the Initial Public Offering. Immediately thereafter, temporary equity was remeasured and an adjustment was recognized through additional paid in capital and accumulated deficit to adjust temporary equity to the redemption value. Warrant Liabilities The Company accounts for the Public Warrants (as defined in Note 2) and Private Placement Warrants (together with the Public Warrants, the “Warrants”) in accordance with the guidance contained in ASC 815-40, under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrants as liabilities at their fair value and adjusts the Warrants to fair value in respect of each reporting period. This liability is subject to re-measurement at each balance sheet date until the Warrants are exercised, and any change in fair value is recognized in the consolidated statements of operations. The Private Placement Warrants and the Public Warrants for periods where no observable traded price was available are valued using a Monte Carlo simulation. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrants’ quoted market price was used as the fair value as of each relevant date. Class A Common Stock Subject to Possible Redemption The Company accounts for its shares of Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s consolidated balance sheets. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable common stock are affected by charges against additional paid-in capital and accumulated deficit. At December 31, 2021 and 2020, the ordinary shares reflected in the consolidated balance sheets are reconciled in the following table: Gross proceeds $ 276,000,000 Less: Proceeds allocated to Public Warrants (11,454,000) Class A common stock issuance costs (15,179,927) Plus: Remeasurement of carrying value to redemption value 26,667,374 Common stock subject to possible redemption, 12/31/20 276,033,447 Remeasurement of carrying value to redemption value (33,447) Common stock subject to possible redemption, 12/31/21 $ 276,000,000 Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the consolidated financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The effective tax rates differ from the statutory tax rate for the periods presented primarily due to the change in warrant valuation and the valuation allowance recorded on the Company’s net operating losses. ASC 740 prescribes a recognition threshold and a measurement attribute for the consolidated financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. Net Loss Per Common Share The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. The Company has two classes of common stock, which are referred to as Class A common stock and Class B common stock. Income and losses are shared pro rata between the two classes of common stock. Net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. Remeasurement associated with the redeemable shares of Class A common stock is excluded from loss per common share as the redemption value approximates fair value. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 21,320,000 shares in the calculation of diluted loss per share, since the exercise of the warrants is contingent upon the occurrence of future events. As of December 31, 2021 and 2020, the Company did not have any other dilutive securities or other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company. As a result, diluted net loss per common share is the same as basic net loss per common share for the periods presented. The following table reflects the calculation of basic and diluted net loss per common share (in dollars, except per share amounts): For the Period from February 14, 2020 (Inception) Through Year Ended December 31, December 31, 2021 2020 Class A Class B Class A Class B Basic and diluted net loss per common share Numerator: Allocation of net loss, as adjusted $ (10,318,466) $ (2,579,616) $ (10,719,238) $ (4,575,622) Denominator: Basic and diluted weighted average stock outstanding 27,600,000 6,900,000 15,218,692 6,496,262 Basic and diluted net loss per common share $ (0.37) $ (0.37) $ (0.70) $ (0.70) Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Corporation coverage limit of $250,000. The Company has not experienced losses on this account. Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying consolidated balance sheets, primarily due to their short-term nature. The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. Recent Accounting Standards In August 2020, the FASB issued ASU No. 2020-06, “Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s consolidated financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s consolidated financial statements. |
Business Combination and Revers
Business Combination and Reverse Recapitalization | 6 Months Ended |
Jun. 30, 2022 | |
Business Combination and Reverse Recapitalization [Abstract] | |
Business Combination and Reverse Recapitalization | 3. Business Combination and Reverse Recapitalization 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. In connection with the Business Combination, the Company incurred approximately $37.2 million of costs, consisting of underwriting, legal, and other professional fees, $34.5 million of which were direct transaction costs and recorded to additional paid-in capital as a reduction of proceeds and $2.7 million of which were not directly attributable to the Business Combination and recorded as an expense in selling, general and administrative expense on the accompanying condensed consolidated statements of operations. The following table summarizes the net proceeds from the Business Combination, as reconciled to the accompanying condensed consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholder’s equity (deficit) and the condensed consolidated statements of cash flows: Amount Cash - CPSR trust and cash (net of redemptions) $ 7,558 Cash - PIPE Investment 90,000 Cash - Backstop Agreement 7,442 Gross proceeds $ 105,000 Less: transaction costs, advisory fees and liabilities paid (34,522) Net proceeds from the Business Combination $ 70,478 Immediately prior to closing of the Business Combination, Legacy Gelesis common stock was split according to the exchange ratio of 2.59, which was determined pursuant to the Business Combination Agreement and based on Legacy Gelesis’ implied price per share prior to the Business Combination. Upon closing of the Business Combination, holders received shares of common stock of the Company on a one-to-one basis. For periods prior to the Business Combination, in the accompanying condensed consolidated financial statements, the reported share and per share amounts have been retroactively converted (“Retroactive Application of Recapitalization”) by applying the exchange ratio. The consolidated assets, liabilities and results of operations prior to the Business Combination are those of Legacy Gelesis Immediately prior to the closing of the Business Combination, Legacy Gelesis redeemable convertible preferred stock converted into Legacy Gelesis common stock and was 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. Immediately prior to the closing of the Business Combination, Legacy Gelesis stock options and restricted stock units (“RSU”) were split according to the exchange ratio of 2.59. Upon closing of the Business Combination, holders of Legacy Gelesis stock options received a stock option to purchase shares of the Company’s common stock on a one-to-one basis and holder of Legacy Gelesis RSUs received RSUs of the Company on a one-to-one basis. 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 rollover common stock warrants of the Company on a one-to-one basis. Immediately prior to the closing of the Business Combination, Legacy Gelesis common warrants were split according to the exchange ratio of 2.59. Upon closing of the Business Combination, holders received rollover common stock warrants of the Company on a one-to-one basis. The number of shares of common stock issued and outstanding immediately following the consummation of the Business Combination was as follows: Common Stock CPSR Public Stockholders 755,223 CPSR Sponsor Stockholders 4,916,250 Total CPSR Stockholders 5,671,473 Common stock issued to Gelesis Legacy Equityholders 54,814,847 Common stock issued to PIPE Investors and Backstop Agreement 11,727,967 Total common stock immediately after Closing 72,214,287 Earnout Shares In addition, each holder of Legacy Gelesis common stock, Legacy Gelesis options and Legacy Gelesis warrants will receive a pro rata portion of up to 23,482,845 restricted earnout shares of Gelesis Holding’s common stock, which will be issued and vest in equal thirds if the trading price of the Company’s common stock is greater than or equal to $12.50, $15.00 and $17.50, respectively, for any twenty thirty The Company determined 18,758,241 earnout shares are considered a contingent consideration arrangement in accordance with ASC 815, and recorded a liability upon the closing of the Business Combination of $58.9 million (see Note 14). The Company determined the remaining 4,724,604 earnout shares, which pertain to Legacy Gelesis equity awards, are incremental compensation in accordance with ASC 718 and equity classified. The total fair value of incremental compensation cost at the close of Business Combination was $14.8 million which will be expensed according to the vesting terms of the original underlying equity awards. The total incremental compensation cost, pertaining to Legacy Gelesis equity awards which had previously vested, was $11.4 million, of which $7.0 million and $4.4 million was recognized immediately following the close of the Business Combination as expense in selling, general and administrative expense and research and development expense, respectively, in the accompanying condensed consolidated statements of operations. Public Warrants and Private Placement Warrants Upon the closing of the Business Combination, the Company assumed 13,800,000 Public Warrants and 7,520,000 Private Placement Warrants. The Company determined the Public Warrants qualified as equity instruments in accordance with ASC 815 and reclassified the Public Warrants from liability to equity classification and the carrying value of $7.1 million was transferred to APIC on the accompanying condensed consolidated balance sheets. The Company determined the Private Placement Warrants met the definition of a liability under ASC 815 and recorded a liability reflecting the fair value of the Private Placement Warrants of $8.1 million. See Note 13 and Note 15 for further information on the Private Placement and Public Warrants, respectively. |
Fair Value Measurements_2
Fair Value Measurements | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | ||
Fair Value Measurements | 4. Fair Value Measurements Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at June 30, 2022 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Earnout liability (See Note 14) $ 6,190 $ — $ — $ 6,190 Private placement warrant liability (see Note 13) 1,130 — — 1,130 One S.r.l. call option (see Note 11) 3,062 — — 3,062 Total liabilities measured at fair value $ 10,382 $ — $ — $ 10,382 Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at December 31, 2021 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Convertible promissory notes (see Note 12) $ 27,128 $ — $ — $ 27,128 Legacy Gelesis preferred stock warrants (See Note 13) 15,821 — — 15,821 One S.r.l. call option (see Note 11) 2,416 — — 2,416 Total liabilities measured at fair value $ 45,365 $ — $ — $ 45,365 The following table presents a summary of the changes in the fair value of the Company’s Level 3 financial instruments during the six months ended June 30, 2022: Legacy Gelesis Redeemable Preferred Convertible Stock Promissory Warrants One S.r.l. Call Earnout Private Placement Notes Liabilities Option Liability Warrant Liability Balance at December 31, 2021 $ 27,128 $ 15,821 $ 2,416 $ — $ — Assumed upon Business Combination — — — — 8,140 Recognized upon Business Combination — — — 58,871 — Changes in fair value 156 926 865 (52,681) (7,010) Foreign currency translation (gain)/loss — — (219) — — Conversion and exchange upon Business Combination — (16,747) — — — Settlement (27,284) — — — — Balance at June 30, 2022 $ — $ — $ 3,062 $ 6,190 $ 1,130 There were no transfers out level | NOTE 10. FAIR VALUE MEASUREMENTS The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at December 31, 2021 and 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: Description Level December 31, 2021 December 31, 2020 Assets Cash and marketable securities held in Trust Account 1 $ 276,207,207 $ 276,209,453 Liabilities: Warrant Liability — Public Warrants 1 $ 8,964,000 $ 19,458,000 Warrant Liability — Private Placement Warrants 3 $ 13,805,441 $ 10,643,808 The Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities in the accompanying consolidated balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the consolidated statements of operations. The measurement of the Public Warrants as of December 31, 2021 and 2020 is classified as Level 1 due to the use of an observable market quote in an active market. Level 3 financial liabilities consist of the Private Placement Warrant liability for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate. The fair value of the Private Placement Warrants was estimated at December 31, 2021 and 2020 to be $1.84 per warrant and $1.42 per warrant, respectively, using the modified Black-Scholes option pricing model and the following assumptions: December 31, 2021 December 31, 2020 Risk free rate 1.26 % 0.47 % Expected term 5.04 5.76 Dividend yield 0.00 % 0.00 % Expected volatility 24.28 % 19.0 % Exercise price $ 11.50 $ 11.50 Unit Price $ 9.96 $ 10.15 The following table presents the changes in the fair value of Level 3 warrant liabilities: Warrant Private Placement Public Liabilities Fair value as of January 1, 2020 $ $ $ Initial measurement on July 7, 2020 (Initial Public Offering) 6,241,600 11,454,000 17,695,600 Transfer to Level 1 — (11,046,900) (11,046,900) Change in fair value 4,402,208 (407,100) 3,995,108 Fair value as of December 31, 2020 $ 10,643,808 $ — $ 10,643,808 Change in fair value 3,161,633 — 3,161,633 Fair value as of December 31, 2021 $ 13,805,441 — $ 13,805,441 Due to the use of quoted prices in an active market (Level 1) to measure the fair value of the Public Warrants, subsequent to initial measurement, the Company had transfers out of Level 3 totaling approximately $11.1 million during the period from July 7, 2020 through December 31, 2020. There were no transfers in or out of Level 3 from other levels in the fair value hierarchy during the year ended December 31, 2021. |
Product Revenue and Reserve and
Product Revenue and Reserve and Allowances | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Revenue From Contract With Customer [Abstract] | ||
Product Revenue and Reserve and Allowances | 5. Product Revenue and Reserve and Allowances 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 end-user patients and healthcare providers. Patients are required to have a prescription in order to purchase the Product in the United States. Revenue for the three and six months ended June 30, 2022 and 2021 consisted of the following (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Roman Health Pharmacy LLC $ 6,916 $ 2,037 $ 13,415 $ 4,931 GoGoMeds 2,057 140 3,072 230 CMS — — — 119 Total $ 8,973 $ 2,178 $ 16,487 $ 5,279 Roman Health Pharmacy LLC (“Ro”) On June 14, 2022, the Company entered into a Third Amended and Restated Supply and Distribution Agreement with Ro, pursuant to which the parties amended their previous agreement that granted Ro exclusive telehealth distributor rights to sell Plenity in the United States in the mail order/online pharmacy channel. Pursuant to the amendment, the Company received $15.0 million in cash from Ro as a pre-buy commitment to purchase units of Plenity, which was recorded to deferred income upon receipt in the accompanying condensed consolidated balance sheets. At June 30, 2022 and December 31, 2021, the Company recorded a deferred income balance of $32.5 million and $31.0 million, respectively, in current liabilities in the accompanying condensed consolidated balance sheets with respect to Ro. GoGoMeds(“GGM”) At June 30, 2022 and December 31, 2021, the Company recorded an accounts receivable balance of $1.3 million and $0.8 million, respectively, prior to reserves and allowances (see below), in the accompanying condensed consolidated balance sheets with respect to GGM. CMS Bridging DMCC(“CMS”) At June 30, 2022 and December 31, 2021, the discounted time-based milestone had a balance of $4.2 million and $4.1 million, respectively, included in other assets in the accompanying condensed consolidated balance sheets. The royalties and other commercial milestones will only be recognized in the periods in which the applicable subsequent sales occur. Reserves and Allowances The following table summarizes the activity in the product revenue reserve and allowance during the six months ended June 30, 2022 and 2021 (in thousands): 2022 2021 Balance at December 31, $ 82 $ 14 Provision related to product sales 1,193 326 Credits and payments made (1,154) (324) Balance at June 30, $ 121 $ 16 At June 30, 2022 and 2021, 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 June 30, 2022, there had been no product related reserves or allowances owed to other parties, including the federal and state governments or their agencies. | |
Gelesis | ||
Product Revenue Reserve and Allowance | 5. 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 end-user patients and healthcare providers. Patients are required to have a prescription in order to purchase the Product in the US. Roman Health Pharmacy LLC In August 2019, the Company entered into a two-year exclusive supply and distribution agreement with Roman Health Pharmacy LLC (“Ro”), giving Ro exclusive distributor rights to sell the Product via telehealth platforms in the United States. Ro submits purchase orders as needed to Cardinal Health, the Company’s third-party logistics distribution agent for commercial sales of the Product, and Cardinal Health ships to Ro. Pursuant to the terms of the 2019 agreement, the Company retained control of the Product until Ro received an end-user purchase order and prepared the Product for shipment to Ro patients, at which time control passes to Ro. The Company began shipping products to Ro in May 2020. The Company recognized revenue based on units shipped by Ro to end-users. In January 2021, the Company and Ro amended and restated its customer agreement. Pursuant to the amended and restated agreement, the Company received $10.0 million of cash as a pre-buy commitment for Product which was recorded to current deferred income in the accompanying consolidated balance sheets. Additionally, the amended and restated agreement ended the consignment arrangement with Ro and the Company no longer retains control of any units shipped to Ro under the amended terms. Henceforth, all products shipped to Ro are immediately recognized as revenue upon the transfer of physical control. In July 2021, the Company and Ro entered into a second amended and restatement agreement, under which the Company received $30.0 million of cash as a second pre-buy commitment for the Product, which was recorded to current deferred income in the accompanying consolidated balance sheets. Additionally, the Company extended Ro’s exclusive period by approximately one year through July 1, 2023. Upon expiration of the exclusive period as amended, the exclusive right and license under the agreement shall automatically convert to non-exclusive for the remainder of term of the agreement unless further extended. The agreement may be terminated by mutual agreement after the exclusive period expired. During the years ended December 31, 2021 and 2020, the Company recognized $9.7 million and $2.5 million, respectively, of product revenue, net, in the accompanying consolidated statements of operations with respect to Ro. The Company recorded a deferred income balance of $31.0 million at December 31, 2021 and an accounts receivable balance of $0.6 million at December 31, 2020 with respect to Ro in the accompanying consolidated balance sheets. GoGoMeds In February 2020, the Company entered into a two-year exclusive distribution agreement with GoGoMeds (“GGM”), giving GGM exclusive distributor rights to all online and mail orders generated in the United States, except those via telehealth. GGM submits purchase orders as needed to Cardinal Health and Cardinal Health ships to GGM. Once GGM has accepted the delivered Product, GGM takes control of the Product and the Company is entitled to payment. The Company began shipping products to GGM in May 2020. The Company recognizes revenue based on units shipped to GGM and upon transfer of physical control. During the years ended December 31, 2021 and 2020, the Company recognized $1.5 million and $0.1 million, respectively, of product revenue, net, in the accompanying consolidated statements of operations with respect to GGM. At December 31, 2021 and December 31, 2020, the Company recorded an accounts receivable balance of $0.8 million and $0.1 million, respectively, prior to reserves and allowances, in the accompanying consolidated balance sheets with respect to GGM. CMS Bridging DMCC In June 2020, the Company and CMS Bridging DMCC (“CMS”) entered into a set of licensing, collaboration, and investing agreements (“CMS Agreements”) involving the license of the Company’s intellectual property (“IP”) to CMS in Singapore and Greater China (the “CMS Territory”) and governing the supply of product from the Company to CMS for sale in the CMS Territory, together with an agreement for CMS to invest in the Company’s Series Growth 3 & 4 Preferred Shares. Under the terms of the CMS Agreement, the Company granted CMS an exclusive, transferable, sub-licensable, and royalty-bearing license of the Company’s IP to develop, import, register, manufacture, and commercialize the Product, whether through online sales channels or offline sales channels during the term of the agreement. The agreement can be terminated earlier by mutual agreement of the parties. In accordance with the CMS Agreement, all legal and beneficial ownership of (i) all IP rights relating to the Products (including any data generated from the use of the Products and other improvements) and (ii) all of the information provided or generated under the agreement or otherwise related to the Products shall both ultimately belong to and remain vested with the Company. CMS must purchase the Product from the Company at a markup of the Company’s cost of goods sold. As consideration for the rights and licenses granted by the Company to CMS under the agreement, CMS paid the Company a one-time, non-refundable and non-creditable upfront fee of $15.0 million and is required to pay a one-time, non-refundable, and non-creditable milestone payment of $5.0 million within thirty days after the earlier of (i) the approval of marketing authorization as a prescription product by the Product by National Medical Products Administration, and (ii) the fifth anniversary of the agreement’s effective date. The CMS Agreement also contains commercial milestones due to the Company based on the achievement of annual net product revenue thresholds in the CMS Territory. Additionally, CMS shall pay the Company royalties on net sales of all products in the CMS Territory commencing January 1, 2022 through the expiration date of the agreement. The Company determined the only performance obligation that exists is the licensing of the Product in the CMS Territory. The transactions price consisted of the $15.0 million upfront payment and the discounted time-based milestone of $3.7 million with the difference of $1.3 million accreted as interest income over five years with the remaining balance being accreted in full upon the approval of the marketing authorization as a prescription product if achieved prior to the end of the five years. The IP license granted to CMS represents a right to use the IP and therefore is recognized at a point in time, which was determined to be the effective date of the agreements. As such, the Company recognized revenue in the amount of $18.7 million during the year ended December 31, 2020, which is included under license and collaboration revenue in the accompanying consolidated statements of operations. At December 31, 2021 and December 31, 2020, the discounted time-based milestone had a balance of $4.1 million and $3.9 million, respectively, included in other assets in the accompanying consolidated balance sheets. The royalties and other commercial milestones will only be recognized in the periods in which the applicable subsequent sales occur. Total Product Revenue, net and Reserves During the years ended December 31, 2021 and 2020, the Company recognized $11.2 million and $2.7 million, respectively, of product revenue, net in the accompanying consolidated statements of operations. At December 31, 2021 and December 31, 2020, the Company had accounts receivable of $0.7 million and $0.8 million, respectively, prior to reserves and allowances. The following table summarizes the activity in the product revenue reserve and allowance for the years ended December 31, 2021 and 2020 (in thousands): Product Revenue Reserves Balance at December 31, 2019 $ — Provision related to product sales 980 Credits and payments made (966) Balance at December 31, 2020 14 Provision related to product sales 522 Credits and payments made (454) Balance at December 31, 2021 $ 82 At December 31, 2021 and 2020, 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 consolidated balance sheets for the year. Through December 31, 2021, there had been no product related reserves or allowances owed to other parties, including the federal and state governments or their agencies. |
Inventories
Inventories | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | ||
Inventories | 6. Inventories Inventories consisted of the following (in thousands): June 30, December 31, 2022 2021 Raw materials $ 9,599 $ 8,074 Work in process 4,746 2,643 Finished goods 4,476 2,786 Total inventories $ 18,821 $ 13,503 | |
Inventories | 6. Inventories Inventories consisted of the following (in thousands): June 30, December 31, 2022 2021 Raw materials $ 9,599 $ 8,074 Work in process 4,746 2,643 Finished goods 4,476 2,786 Total inventories $ 18,821 $ 13,503 | |
Gelesis | ||
Inventory Disclosure [Abstract] | ||
Inventories | 6. Inventories Inventories consisted of the following (in thousands): At December 31, 2021 2020 Raw materials $ 8,074 $ 1,213 Work in process 2,643 913 Finished goods 2,786 2,433 Consignment inventories — 563 Total inventories $ 13,503 $ 5,122 | |
Inventories | 6. Inventories Inventories consisted of the following (in thousands): At December 31, 2021 2020 Raw materials $ 8,074 $ 1,213 Work in process 2,643 913 Finished goods 2,786 2,433 Consignment inventories — 563 Total inventories $ 13,503 $ 5,122 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | ||
Prepaid Expenses and Other Current Assets | 7. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): June 30, December 31, 2022 2021 Prepaid expenses $ 1,128 $ 982 Prepaid insurance 1,474 55 Prepaid manufacturing expenses 596 2,624 Prepaid contract research costs 185 262 Research and development tax credit 692 579 Value added tax receivable 1,574 5,633 Deferred financing costs — 3,855 Income tax receivable 198 213 Investment tax credit 906 — Prepaid expenses and other current assets $ 6,753 $ 14,203 | |
Prepaid Expenses and Other Current Assets | 7. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): June 30, December 31, 2022 2021 Prepaid expenses $ 1,128 $ 982 Prepaid insurance 1,474 55 Prepaid manufacturing expenses 596 2,624 Prepaid contract research costs 185 262 Research and development tax credit 692 579 Value added tax receivable 1,574 5,633 Deferred financing costs — 3,855 Income tax receivable 198 213 Investment tax credit 906 — Prepaid expenses and other current assets $ 6,753 $ 14,203 | |
Gelesis | ||
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | ||
Prepaid Expenses and Other Current Assets | 7. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following (in thousands): At December 31, 2021 2020 Prepaid expenses $ 3,874 $ 1,024 Prepaid contract research costs 262 169 Research and development tax credit 579 1,131 Value added tax receivable 5,633 4,315 Deferred financing costs 3,855 38 Prepaid expenses and other current assets $ 14,203 $ 6,677 | |
Prepaid Expenses and Other Current Assets | 7. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following (in thousands): At December 31, 2021 2020 Prepaid expenses $ 3,874 $ 1,024 Prepaid contract research costs 262 169 Research and development tax credit 579 1,131 Value added tax receivable 5,633 4,315 Deferred financing costs 3,855 38 Prepaid expenses and other current assets $ 14,203 $ 6,677 |
Property and Equipment, Net
Property and Equipment, Net | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Property Plant And Equipment [Abstract] | ||
Property and Equipment, Net | 8. Property and Equipment, Net Property and equipment, net, consisted of the following (in thousands): June 30, December 31, 2022 2021 Laboratory and manufacturing equipment $ 28,158 $ 28,101 Land and buildings 10,186 10,404 Leasehold improvements 1,490 1,614 Computer equipment and software 529 463 Capitalized software 232 228 Construction in process 21,683 22,097 Property and equipment – at cost 62,278 62,907 Less accumulated depreciation (5,973) (4,392) Property and equipment – net $ 56,305 $ 58,515 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 a 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 June 30, 2022 and December 31, 2021 are related to the development of manufacturing lines that have not yet been placed into service at June 30, 2022 and December 31, 2021, respectively. Depreciation expense was approximately $0.4 million and $0.2 million for the three months ended June 30, 2022 and 2021, respectively, and $1.4 million and $0.4 million for the six months ended June 30, 2022 and 2021, respectively. | |
Property and Equipment, Net | 8. Property and Equipment, Net Property and equipment, net, consisted of the following (in thousands): June 30, December 31, 2022 2021 Laboratory and manufacturing equipment $ 28,158 $ 28,101 Land and buildings 10,186 10,404 Leasehold improvements 1,490 1,614 Computer equipment and software 529 463 Capitalized software 232 228 Construction in process 21,683 22,097 Property and equipment – at cost 62,278 62,907 Less accumulated depreciation (5,973) (4,392) Property and equipment – net $ 56,305 $ 58,515 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 a 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 June 30, 2022 and December 31, 2021 are related to the development of manufacturing lines that have not yet been placed into service at June 30, 2022 and December 31, 2021, respectively. Depreciation expense was approximately $0.4 million and $0.2 million for the three months ended June 30, 2022 and 2021, respectively, and $1.4 million and $0.4 million for the six months ended June 30, 2022 and 2021, respectively. | |
Gelesis | ||
Property Plant And Equipment [Abstract] | ||
Property and Equipment, Net | 8. Property and Equipment, Net Property and equipment, net, consists of the following (in thousands): At December 31, 2021 2020 Laboratory and manufacturing equipment $ 28,101 $ 8,176 Land and buildings 10,404 4,334 Leasehold improvements 1,614 1,742 Computer equipment and software 463 176 Capitalized software 228 17 Construction in process 22,097 35,551 Property and equipment – at cost 62,907 49,996 Less accumulated depreciation (4,392) (3,101) Property and equipment – net $ 58,515 $ 46,895 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 a 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 December 31, 2021 and 2020 are related to the development of manufacturing lines that have not yet been placed into service at December 31, 2021. Depreciation expense was approximately $1.5 million and $0.5 million and for the years ended December 31, 2021 and 2020, respectively. | |
Property and Equipment, Net | 8. Property and Equipment, Net Property and equipment, net, consists of the following (in thousands): At December 31, 2021 2020 Laboratory and manufacturing equipment $ 28,101 $ 8,176 Land and buildings 10,404 4,334 Leasehold improvements 1,614 1,742 Computer equipment and software 463 176 Capitalized software 228 17 Construction in process 22,097 35,551 Property and equipment – at cost 62,907 49,996 Less accumulated depreciation (4,392) (3,101) Property and equipment – net $ 58,515 $ 46,895 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 a 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 December 31, 2021 and 2020 are related to the development of manufacturing lines that have not yet been placed into service at December 31, 2021. Depreciation expense was approximately $1.5 million and $0.5 million and for the years ended December 31, 2021 and 2020, respectively. |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Jun. 30, 2022 | |
Payables And Accruals [Abstract] | |
Accrued Expenses | 9. Accrued Expenses Accrued expenses and other current liabilities consisted of the following (in thousands): June 30, December 31, 2022 2021 Accrued payroll and related benefits $ 2,442 $ 1,384 Accrued professional fees and outside contractors (including due to related party of 2,392 4,359 Accrued property, plant and equipment additions 589 1,257 Accrued inventory and manufacturing expense 285 128 Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) 2,612 5,604 Tax payables 70 145 Deferred legal fees 738 738 Accrued interest 587 45 Total accrued expenses $ 9,715 $ 13,660 |
Other Long-Term Liabilities
Other Long-Term Liabilities | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | ||
Other Long-Term Liabilities | 10. Other Long-Term Liabilities Other long-term liabilities consisted of the following (in thousands): June, December 31, 2022 2021 Long-term tax liabilities 91 182 Contingent loss for research and development tax credits 2,755 2,990 One S.r.l. call option (see Note 11) 3,062 2,416 Total other long-term liabilities $ 5,908 $ 5,588 | |
Other Long-Term Liabilities | 10. Other Long-Term Liabilities Other long-term liabilities consisted of the following (in thousands): June, December 31, 2022 2021 Long-term tax liabilities 91 182 Contingent loss for research and development tax credits 2,755 2,990 One S.r.l. call option (see Note 11) 3,062 2,416 Total other long-term liabilities $ 5,908 $ 5,588 | |
Gelesis | ||
Other Liabilities Disclosure [Abstract] | ||
Other Long-Term Liabilities | 10. Other Long-Term Liabilities Other long-term liabilities consist of the following (in thousands): At December 31, 2021 2020 Deferred IPO fees $ — $ 738 Long-term tax liabilities 182 301 Contingent loss for research and development tax credits 2,990 3,233 Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) — 5,912 One Srl call option (see Note 11) 2,416 1,545 Total other long-term liabilities $ 5,588 $ 11,729 | |
Other Long-Term Liabilities | 10. Other Long-Term Liabilities Other long-term liabilities consist of the following (in thousands): At December 31, 2021 2020 Deferred IPO fees $ — $ 738 Long-term tax liabilities 182 301 Contingent loss for research and development tax credits 2,990 3,233 Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) — 5,912 One Srl call option (see Note 11) 2,416 1,545 Total other long-term liabilities $ 5,588 $ 11,729 |
Significant Agreements
Significant Agreements | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Significant Agreements [Abstract] | ||
Significant Agreements | 11. Significant Agreements Puglia 1 Grant 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”), The Company recognized grant income of $0.4 million and $0.4 million in other income, net, on the accompanying condensed consolidated statements of operations during the six months ended June 30, 2022 and 2021, respectively, related to the PIA 1 Grant, of which less than $0.1 million and $0.4 million was attributable to research and development expenses and investments in facilities and equipment, respectively, during the six months ended June 30, 2022 and less than $0.2 million was attributable to both research and development expenses and investments in facilities and equipment, respectively, during the six months ended June 30, 2021. The Company recorded $5.5 million and $6.4 million of deferred income in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively, of which $0.8 million and $0.9 million was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying condensed consolidated balance sheets. The Company collected zero proceeds from the PIA 1 Grant during the six months ended June 30, 2022, and recorded a grant receivable of $5.0 million and $5.4 million in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively. Puglia 2 Grant 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”), The Company recognized grant income of $1.0 million and $1.0 million in other income, net, on the accompanying condensed consolidated statements of operations during the six months ended June 30, 2022, and 2021, respectively, related to the PIA 2 Grant, which was entirely attributable to research and development expenses. The Company has recorded $3.4 million and $3.7 million of deferred income in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively, of which $0.2 million and $0.4 million was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying condensed consolidated balance sheets. The Company collected zero proceeds from the PIA 2 Grant during the six months ended June 30, 2022, and has recorded a grant receivable of $4.4 million and $3.6 in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively. One S.r.l. (“One”) Amended Patent License and Assignment Agreement In June 2019, the Company amended and restated an existing master agreement with One (the “2019 One Amendment”), the original inventor of the Company’s core patents and a related party to the Company (see Notes 19 and 20). Under the amended and restated master agreement following this transaction, the Company eliminated certain future commercial milestone obligations and received a reduction in the percentage of royalties the Company was required to pay on future net sales. In return, One received additional consideration consisting of new future milestones upon the commercial success of new medical indications and a contingently issuable warrant for redeemable convertible preferred stock. Additionally, the Company acquired a 10% equity interest in One in exchange for cash consideration. The Company accounted for the reduction in royalties the Company is required to pay on future net revenues that resulted from the 2019 One Amendment 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. The Company accounted for the acquisition of the 10% equity interest in One under ASC 323, Investments – Equity Method and Joint Ventures. In connection with the acquisition of the 10% equity interest in One, the Company made a payment of $2.9 million to One shareholders during the six months ended June 30, 2022. The Company had remaining undiscounted payments of €2.5 million and €5.0 million due to One at June 30, 2022 and December 31, 2021, respectively (approximately $2.6 million and $5.7 million due to One at June 30, 2022 and December 31, 2021, respectively). The remaining payments at June 30, 2022 were recorded 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 June 30, 2022 and December 31, 2021, respectively. A summary of the intangible asset activity that resulted from this transaction during the six months ended June 30, 2022 is as follows (in thousands): Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Cumulative amortization expense (5,667) Balance at December 31, 2021 $ 15,680 Period amortization expense (1,133) Balance at June 30, 2022 $ 14,547 In October 2020, the Company further amended the terms of the agreement with One to 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 $6.3 million at June 30, 2022). 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 (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 S.r.l. 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 S.r.l. call option liability during the six months ended June 30, 2022 (in thousands): Balance at December 31, 2021 $ 2,416 Change in fair value 865 Foreign currency translation gain (219) Balance at June 30, 2022 $ 3,062 The following weighted average assumptions were used to determine the fair value of the One S.r.l. call option liability at June 30, 2022 and December 31, 2021: June 30, December 31, 2022 2021 Expected term 4.0 years 2.0 years Expected volatility 64.0 % 62.0 % Expected dividend yield 0.0 % 0.0 % Risk free interest rate 3.0 % 0.70 % Estimated fair value of ownership interest $ 6,097 $ 6,922 Exercise price of call option $ 6,270 $ 6,806 Research Innovation Fund (“RIF”) Financing In August 2020, the 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 $10.4 million at June 30, 2022) from RIF as an equity investment and €15.0 million (approximately $15.7 million at June 30, 2022) 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 June 30, 2022, RIF holds approximately 20% of the equity of Gelesis S.r.l. The Company recorded accretion of $0.2 million and foreign currency translation gain of $0.9 million to the noncontrolling interest during the six months ended June 30, 2022. The noncontrolling interest balance was $11.1 million and $11.9 million at June 30, 2022 and December 31, 2021, respectively, in the accompanying condensed consolidated balance sheets. | |
Significant Agreements | 11. Significant Agreements Puglia 1 Grant 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”), The Company recognized grant income of $0.4 million and $0.4 million in other income, net, on the accompanying condensed consolidated statements of operations during the six months ended June 30, 2022 and 2021, respectively, related to the PIA 1 Grant, of which less than $0.1 million and $0.4 million was attributable to research and development expenses and investments in facilities and equipment, respectively, during the six months ended June 30, 2022 and less than $0.2 million was attributable to both research and development expenses and investments in facilities and equipment, respectively, during the six months ended June 30, 2021. The Company recorded $5.5 million and $6.4 million of deferred income in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively, of which $0.8 million and $0.9 million was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying condensed consolidated balance sheets. The Company collected zero proceeds from the PIA 1 Grant during the six months ended June 30, 2022, and recorded a grant receivable of $5.0 million and $5.4 million in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively. Puglia 2 Grant 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”), The Company recognized grant income of $1.0 million and $1.0 million in other income, net, on the accompanying condensed consolidated statements of operations during the six months ended June 30, 2022, and 2021, respectively, related to the PIA 2 Grant, which was entirely attributable to research and development expenses. The Company has recorded $3.4 million and $3.7 million of deferred income in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively, of which $0.2 million and $0.4 million was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying condensed consolidated balance sheets. The Company collected zero proceeds from the PIA 2 Grant during the six months ended June 30, 2022, and has recorded a grant receivable of $4.4 million and $3.6 in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively. One S.r.l. (“One”) Amended Patent License and Assignment Agreement In June 2019, the Company amended and restated an existing master agreement with One (the “2019 One Amendment”), the original inventor of the Company’s core patents and a related party to the Company (see Notes 19 and 20). Under the amended and restated master agreement following this transaction, the Company eliminated certain future commercial milestone obligations and received a reduction in the percentage of royalties the Company was required to pay on future net sales. In return, One received additional consideration consisting of new future milestones upon the commercial success of new medical indications and a contingently issuable warrant for redeemable convertible preferred stock. Additionally, the Company acquired a 10% equity interest in One in exchange for cash consideration. The Company accounted for the reduction in royalties the Company is required to pay on future net revenues that resulted from the 2019 One Amendment 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. The Company accounted for the acquisition of the 10% equity interest in One under ASC 323, Investments – Equity Method and Joint Ventures. In connection with the acquisition of the 10% equity interest in One, the Company made a payment of $2.9 million to One shareholders during the six months ended June 30, 2022. The Company had remaining undiscounted payments of €2.5 million and €5.0 million due to One at June 30, 2022 and December 31, 2021, respectively (approximately $2.6 million and $5.7 million due to One at June 30, 2022 and December 31, 2021, respectively). The remaining payments at June 30, 2022 were recorded 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 June 30, 2022 and December 31, 2021, respectively. A summary of the intangible asset activity that resulted from this transaction during the six months ended June 30, 2022 is as follows (in thousands): Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Cumulative amortization expense (5,667) Balance at December 31, 2021 $ 15,680 Period amortization expense (1,133) Balance at June 30, 2022 $ 14,547 In October 2020, the Company further amended the terms of the agreement with One to 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 $6.3 million at June 30, 2022). 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 (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 S.r.l. 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 S.r.l. call option liability during the six months ended June 30, 2022 (in thousands): Balance at December 31, 2021 $ 2,416 Change in fair value 865 Foreign currency translation gain (219) Balance at June 30, 2022 $ 3,062 The following weighted average assumptions were used to determine the fair value of the One S.r.l. call option liability at June 30, 2022 and December 31, 2021: June 30, December 31, 2022 2021 Expected term 4.0 years 2.0 years Expected volatility 64.0 % 62.0 % Expected dividend yield 0.0 % 0.0 % Risk free interest rate 3.0 % 0.70 % Estimated fair value of ownership interest $ 6,097 $ 6,922 Exercise price of call option $ 6,270 $ 6,806 Research Innovation Fund (“RIF”) Financing In August 2020, the 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 $10.4 million at June 30, 2022) from RIF as an equity investment and €15.0 million (approximately $15.7 million at June 30, 2022) 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 June 30, 2022, RIF holds approximately 20% of the equity of Gelesis S.r.l. The Company recorded accretion of $0.2 million and foreign currency translation gain of $0.9 million to the noncontrolling interest during the six months ended June 30, 2022. The noncontrolling interest balance was $11.1 million and $11.9 million at June 30, 2022 and December 31, 2021, respectively, in the accompanying condensed consolidated balance sheets. | |
Gelesis | ||
Significant Agreements [Abstract] | ||
Significant Agreements | 11. Significant Agreements Puglia 1 Grant 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. The PIA 1 Grant provides funding of up to €5.3 million (approximately $6.0 million at December 31, 2021) as reimbursement for certain facility and equipment investments in the Company’s manufacturing facility in Calimera, Italy, and up to €3.9 million (approximately $4.4 million at December 31, 2021) as reimbursement for certain research and development expenditures over a three-year period. The Company is required to adhere to standard workplace safety regulations and local laws in Italy and is not permitted to physically move the reimbursed assets from the Puglia region for five years from the project completion date of May 2023. The Company has concluded that income recognition is appropriate as it is reasonably assured that it will comply with all the conditions of the grant and the proceeds from the grant for costs incurred to date will be received. The Company recognized grant income of $0.5 million and $3.5 million in other income, net, on the accompanying consolidated statements of operations during the years ended December 31, 2021 and 2020, respectively, related to the PIA 1 Grant, of which $0.2 million and $0.2 million was attributable to research and development expenses and investments in facilities and equipment, respectively, during the year ended December 31, 2021 and $3.4 million and $0.1 million was attributable to research and development expenses and investments in facilities and equipment, respectively, during the year ended December 31, 2020. The Company recorded $6.4 million and $5.8 million of deferred income in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively, of which $0.9 million and $0.6 million was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying consolidated balance sheets. The Company collected zero proceeds and $4.9 million from the PIA 1 grant during the years ended December 31, 2021 and 2020, respectively, and recorded a grant receivable of $5.4 million and $4.3 million in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively. Puglia 2 Grant 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 PIA 2 Grant provides funding of up to €3.3 million (approximately $3.7 million at December 31, 2021) as reimbursement for certain facility and equipment investments in the Company’s manufacturing facility in Calimera, Italy, and up to €8.3 million (approximately $9.4 million at December 31, 2021) as reimbursement for certain research and development expenditures over a three-year period. The Company is required to adhere to standard workplace safety regulations and local laws in Italy and is not permitted to physically move the reimbursed assets from the Puglia region for five years from the project completion date of November 2023. The Company has concluded that income recognition is appropriate as it is reasonably assured that it will comply with all the conditions of the grant and the proceeds from the grant for costs incurred to date will be received. The Company recognized grant income of $1.1 million and $0.8 million in other income, net, on the accompanying consolidated statements of operations during the years ended December 31, 2021, and 2020, respectively, related to the PIA 2 Grant, which was entirely attributable to research and development expenses. The Company has recorded $3.7 million and $3.0 million of deferred income in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively, of which $0.4 million and zero was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying consolidated balance sheets. The Company collected $1.9 million and zero proceeds from the PIA 2 grant during the years ended December 31, 2021 and 2020, respectively, and has recorded a grant receivable of $3.6 million and $3.9 in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively. 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 19 and 20), to license and subsequently purchase certain intellectual property to develop hydrogel-based product candidates. In December 2014, the Company amended and restated the patent license agreement and the master agreement into a single agreement, referred to as the amended and restated master agreement. The amended and restated master agreement will remain in effect until the expiration of the last patents covered by the agreement or until all obligations under the amended and restated master agreement with respect to payments have terminated or expired. In June 2019, the Company entered into a transaction with One that further amended the terms of the amended and restated master agreement and resulted in the Company owning 10% equity interest in One (the “2019 One Amendment”). Under the amended and restated master agreement following this transaction, €5.5 million (approximately $6.2 million at December 31, 2021) the Company would be required to pay upon the achievement of future commercial milestones from weight loss medical indications were eliminated, and the percentage of royalties the Company is required to pay on future net revenues was reduced. In return, One received additional consideration consisting of new future milestones of up to €11.0 million (approximately $12.5 million at December 31, 2021) upon the commercial success of new medical indications, and the Company was required to issue to One a warrant for redeemable convertible preferred stock equivalent to 2.7% of the shares of capital stock outstanding on an as converted basis within 30 days of the completion of a future qualifying equity financing that results in at least $50.0 million in gross proceeds. The warrant would have an exercise price equivalent to the issuance price of a future qualifying equity financing (see Note 13). As an additional component to this transaction, the Company acquired a 10% equity interest in One in exchange for cash consideration of €11.5 million (approximately $13.0 million at December 31, 2021) with a net present value of €11.1 million (approximately $12.7 million at the transaction date). During the year ended December 31, 2021 the Company did not make any payments of the agreed upon cash consideration. During the year ended December 31, 2020, the Company paid €2.6 million (approximately $3.1 million at the transaction date) of the agreed upon cash consideration. The unpaid cash consideration to One, after adjusting for a foreign currency translation gain and interest expense was $5.6 million and $5.9 million at December 31, 2021 and 2020, respectively. At December 31, 2021, all $5.6 million was included in accrued expenses in the accompanying consolidated balance sheets as it was expected to be settled within the next twelve months. At December 31, 2020, all $5.9 million was included in other long-term liabilities in the accompanying consolidated balance sheets. None of the future milestones under the master agreement, as amended, have been met, or are deemed to be probable of being met, at the transaction date or at December 31, 2021 and 2020, respectively. The Company accounted for the reduction in royalties the Company is required to pay on future net revenues that resulted from the 2019 One Amendment as an intangible asset under ASC 350, Intangibles Goodwill and Other Investments — Equity Method and Joint Ventures Consideration Cash $ 12,668 Warrants for redeemable convertible preferred stock 4,706 Fair value of total consideration $ 17,374 Assets acquired at relative fair value Intangible asset related to reduction in royalty $ 15,564 Equity-method investment 1,810 Total assets acquired $ 17,374 The Company accounted for tax impact of the acquisition of the intangible asset under ASC 740, Income Taxes, which resulted in the recognition of a deferred tax liability of $5.8 million, to account for the book-to-tax basis difference, that was applied to the initial carrying value of the intangible asset acquired. A summary of the intangible asset activity that resulted from this transaction during the years ended December 31, 2021 and 2020 is as follows (in thousands): Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Amortization expense (1,133) Balance at December 31, 2019 $ 20,214 Amortization expense (2,267) Balance at December 31, 2020 $ 17,947 Amortization expense (2,267) Balance at December 31, 2021 $ 15,680 In conjunction with acquiring the investment in One, the Company recognized a deferred tax asset of approximately $3.1 million which represents the excess tax basis over carrying value. The Company recorded this deferred tax asset with a corresponding decrease to the amounts initially allocated to the investment. As the deferred tax asset exceeds the initially allocated balances and results in a reduction of the initial carrying value of the $1.8 million investment balance to zero, the remaining $1.2 million excess was recorded as a deferred credit. In May 2020, the Company transferred the equity-method investment in One from the Gelesis entity in Italy to a Gelesis entity in the US. In connection with the transfer of the equity-method investment, the Company wrote-off the deferred tax asset of $3.0 million generated by the book-to-tax difference and the deferred credit of $1.2 million, resulting in an expense of $1.8 million recorded within provision for income taxes in the accompanying consolidated statements of operations during the year ended December 31, 2020. In October 2020, the Company further amended the terms of the amended and restated master agreement with One to cancel its obligation to issue to One the warrant for redeemable convertible preferred stock agreed to in the 2019 One Amendment (the “2020 One Amendment”). In return for cancelling the warrant, One received additional consideration consisting of a commercial milestone of €6.5 million (approximately $7.4 million at December 31, 2021) upon a weight loss product reaching €2.0 billion in cumulative net sales, and certain shareholders of One were granted warrants to purchase 522,009 shares of the Company’s common stock. The warrant for redeemable convertible preferred stock was remeasured prior to settlement. 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 $6.8 million at December 31, 2021). 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 (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 Company accounted for the 2020 One Amendment by derecognizing the carrying value of the warrant liability for redeemable convertible preferred stock on the date of the 2020 One Amendment, which had a fair value of approximately $6.0 million, and recognizing the consideration provided in the amendment, which had an aggregate fair value of approximately $5.8 million. The difference between the consideration provided by the Company and the warrant liability derecognized, approximately $0.2 million, represents a gain on settlement of the warrant liability and was recognized in other income (expense), net, on the accompanying consolidated statements of operations during the year ended December 31, 2020. As the contingent call option granted to One shareholders to buy back the 10% investment in One did not meet the definition of a derivate under ASC 815, Derivatives and Hedging, the Company recorded the grant date fair value of the call option, approximately $1.5 million, to other long-term liabilities on the consolidated balance sheets. Increases or decreases in fair value of the contingent call option are recorded in the consolidated statements of operations. The Company accounted for the common stock warrants under ASC 815, Derivatives and Hedging, which resulted in recording the grant date fair value of the common stock warrants, approximately $4.3 million, to additional paid in capital in the accompanying consolidated balance sheets. As the common stock warrants are equity-classified, the warrants are recorded at their initial fair value and not subsequently remeasured. The commercial milestone added as part of the 2020 One Amendment constitutes contingent consideration and was provided as additional consideration for a license or asset acquisition, representing one component of the consideration replacing the warrant liability previously provided as part of the consideration for the license. Under asset acquisition accounting, contingent consideration is not recognized until the contingency is resolved. As such, no amount was recognized for the contingent milestone on the date of the amendment. A summary of the gain on the warrant liability settlement that resulted from the 2020 One Amendment during the year ended December 31, 2020 is as follows (in thousands): Carrying value of warrants for redeemable convertible preferred stock $ 5,973 Fair value of common stock warrants, net of cash consideration paid of $10 (4,312) Fair value of contingent call option granted to One shareholders (1,494) Gain on warrant liability extinguishment $ 167 Research Innovation Fund (“RIF”) Financing In August 2020, the 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 $11.3 million at December 31, 2021) from RIF as an equity investment and €15.0 million (approximately $17.0 million at December 31, 2021) as a loan with a fixed interest rate of 6.35% per annum (see Note 12). The equity investment can be called by Gelesis, Inc., 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 December 31, 2021, RIF holds approximately 20% of the equity of Gelesis S.r.l. The Company concluded that Gelesis Inc. is the only equity investment at risk as RIF’s investment is not considered equity due to the call and put options. The Company further evaluated the sufficiency of the equity at risk and concluded that given the fact that Gelesis S.r.l. had to receive the RIF investment, which represents subordinated financial support but not equity, the fair value of Gelesis Inc. equity is not sufficient to absorb its expected losses resulting from its research and development operations and business plan, rather some of its expected losses will have to be absorbed by the RIF investment. The RIF investment is equity held by a noncontrolling interest. Since the put option does not make the equity mandatorily redeemable, and the call option is held by the Company, the noncontrolling interest is not considered mandatorily redeemable and as such, is not presented as a liability. The noncontrolling interest is therefore classified as temporary equity — noncontrolling interest, and is accounted for in accordance with ASC 810, Consolidation The noncontrolling interest is initially recorded at €10.0 million (approximately $11.3 million at transaction date, net of issuance costs of $0.4 million), the consideration allocated to the shareholder investment based on its fair value. The Company has applied ASC 810 to subsequently remeasure the noncontrolling interest, which results in no losses being attributed to the noncontrolling interest, rather, only earnings of the Gelesis S.r.l. entity based on the shareholder rights as a whole instrument. However, the noncontrolling interest shall not be reduced below the current redemption value of the put option, which represents the initial investment plus the accrued rate of return of 3.175% per annum. Adjustments to the noncontrolling interest that result from accreting the put option to its redemption value are recorded to accumulated deficit in the accompanying consolidated balance sheets. The Company recorded accretion of $0.6 million and foreign currency translation loss of $0.5 million to the noncontrolling interest during the year ended December 31, 2020. The Company recorded accretion of $0.4 million and foreign currency translation gain of $1.0 million to the noncontrolling interest during the year ended December 31, 2021. The noncontrolling interest balance was $11.9 million and $12.4 million at December 31, 2021 and 2020, respectively, in the accompanying consolidated balance sheets. | |
Significant Agreements | 11. Significant Agreements Puglia 1 Grant 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. The PIA 1 Grant provides funding of up to €5.3 million (approximately $6.0 million at December 31, 2021) as reimbursement for certain facility and equipment investments in the Company’s manufacturing facility in Calimera, Italy, and up to €3.9 million (approximately $4.4 million at December 31, 2021) as reimbursement for certain research and development expenditures over a three-year period. The Company is required to adhere to standard workplace safety regulations and local laws in Italy and is not permitted to physically move the reimbursed assets from the Puglia region for five years from the project completion date of May 2023. The Company has concluded that income recognition is appropriate as it is reasonably assured that it will comply with all the conditions of the grant and the proceeds from the grant for costs incurred to date will be received. The Company recognized grant income of $0.5 million and $3.5 million in other income, net, on the accompanying consolidated statements of operations during the years ended December 31, 2021 and 2020, respectively, related to the PIA 1 Grant, of which $0.2 million and $0.2 million was attributable to research and development expenses and investments in facilities and equipment, respectively, during the year ended December 31, 2021 and $3.4 million and $0.1 million was attributable to research and development expenses and investments in facilities and equipment, respectively, during the year ended December 31, 2020. The Company recorded $6.4 million and $5.8 million of deferred income in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively, of which $0.9 million and $0.6 million was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying consolidated balance sheets. The Company collected zero proceeds and $4.9 million from the PIA 1 grant during the years ended December 31, 2021 and 2020, respectively, and recorded a grant receivable of $5.4 million and $4.3 million in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively. Puglia 2 Grant 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 PIA 2 Grant provides funding of up to €3.3 million (approximately $3.7 million at December 31, 2021) as reimbursement for certain facility and equipment investments in the Company’s manufacturing facility in Calimera, Italy, and up to €8.3 million (approximately $9.4 million at December 31, 2021) as reimbursement for certain research and development expenditures over a three-year period. The Company is required to adhere to standard workplace safety regulations and local laws in Italy and is not permitted to physically move the reimbursed assets from the Puglia region for five years from the project completion date of November 2023. The Company has concluded that income recognition is appropriate as it is reasonably assured that it will comply with all the conditions of the grant and the proceeds from the grant for costs incurred to date will be received. The Company recognized grant income of $1.1 million and $0.8 million in other income, net, on the accompanying consolidated statements of operations during the years ended December 31, 2021, and 2020, respectively, related to the PIA 2 Grant, which was entirely attributable to research and development expenses. The Company has recorded $3.7 million and $3.0 million of deferred income in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively, of which $0.4 million and zero was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying consolidated balance sheets. The Company collected $1.9 million and zero proceeds from the PIA 2 grant during the years ended December 31, 2021 and 2020, respectively, and has recorded a grant receivable of $3.6 million and $3.9 in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively. 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 19 and 20), to license and subsequently purchase certain intellectual property to develop hydrogel-based product candidates. In December 2014, the Company amended and restated the patent license agreement and the master agreement into a single agreement, referred to as the amended and restated master agreement. The amended and restated master agreement will remain in effect until the expiration of the last patents covered by the agreement or until all obligations under the amended and restated master agreement with respect to payments have terminated or expired. In June 2019, the Company entered into a transaction with One that further amended the terms of the amended and restated master agreement and resulted in the Company owning 10% equity interest in One (the “2019 One Amendment”). Under the amended and restated master agreement following this transaction, €5.5 million (approximately $6.2 million at December 31, 2021) the Company would be required to pay upon the achievement of future commercial milestones from weight loss medical indications were eliminated, and the percentage of royalties the Company is required to pay on future net revenues was reduced. In return, One received additional consideration consisting of new future milestones of up to €11.0 million (approximately $12.5 million at December 31, 2021) upon the commercial success of new medical indications, and the Company was required to issue to One a warrant for redeemable convertible preferred stock equivalent to 2.7% of the shares of capital stock outstanding on an as converted basis within 30 days of the completion of a future qualifying equity financing that results in at least $50.0 million in gross proceeds. The warrant would have an exercise price equivalent to the issuance price of a future qualifying equity financing (see Note 13). As an additional component to this transaction, the Company acquired a 10% equity interest in One in exchange for cash consideration of €11.5 million (approximately $13.0 million at December 31, 2021) with a net present value of €11.1 million (approximately $12.7 million at the transaction date). During the year ended December 31, 2021 the Company did not make any payments of the agreed upon cash consideration. During the year ended December 31, 2020, the Company paid €2.6 million (approximately $3.1 million at the transaction date) of the agreed upon cash consideration. The unpaid cash consideration to One, after adjusting for a foreign currency translation gain and interest expense was $5.6 million and $5.9 million at December 31, 2021 and 2020, respectively. At December 31, 2021, all $5.6 million was included in accrued expenses in the accompanying consolidated balance sheets as it was expected to be settled within the next twelve months. At December 31, 2020, all $5.9 million was included in other long-term liabilities in the accompanying consolidated balance sheets. None of the future milestones under the master agreement, as amended, have been met, or are deemed to be probable of being met, at the transaction date or at December 31, 2021 and 2020, respectively. The Company accounted for the reduction in royalties the Company is required to pay on future net revenues that resulted from the 2019 One Amendment as an intangible asset under ASC 350, Intangibles Goodwill and Other Investments — Equity Method and Joint Ventures Consideration Cash $ 12,668 Warrants for redeemable convertible preferred stock 4,706 Fair value of total consideration $ 17,374 Assets acquired at relative fair value Intangible asset related to reduction in royalty $ 15,564 Equity-method investment 1,810 Total assets acquired $ 17,374 The Company accounted for tax impact of the acquisition of the intangible asset under ASC 740, Income Taxes, which resulted in the recognition of a deferred tax liability of $5.8 million, to account for the book-to-tax basis difference, that was applied to the initial carrying value of the intangible asset acquired. A summary of the intangible asset activity that resulted from this transaction during the years ended December 31, 2021 and 2020 is as follows (in thousands): Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Amortization expense (1,133) Balance at December 31, 2019 $ 20,214 Amortization expense (2,267) Balance at December 31, 2020 $ 17,947 Amortization expense (2,267) Balance at December 31, 2021 $ 15,680 In conjunction with acquiring the investment in One, the Company recognized a deferred tax asset of approximately $3.1 million which represents the excess tax basis over carrying value. The Company recorded this deferred tax asset with a corresponding decrease to the amounts initially allocated to the investment. As the deferred tax asset exceeds the initially allocated balances and results in a reduction of the initial carrying value of the $1.8 million investment balance to zero, the remaining $1.2 million excess was recorded as a deferred credit. In May 2020, the Company transferred the equity-method investment in One from the Gelesis entity in Italy to a Gelesis entity in the US. In connection with the transfer of the equity-method investment, the Company wrote-off the deferred tax asset of $3.0 million generated by the book-to-tax difference and the deferred credit of $1.2 million, resulting in an expense of $1.8 million recorded within provision for income taxes in the accompanying consolidated statements of operations during the year ended December 31, 2020. In October 2020, the Company further amended the terms of the amended and restated master agreement with One to cancel its obligation to issue to One the warrant for redeemable convertible preferred stock agreed to in the 2019 One Amendment (the “2020 One Amendment”). In return for cancelling the warrant, One received additional consideration consisting of a commercial milestone of €6.5 million (approximately $7.4 million at December 31, 2021) upon a weight loss product reaching €2.0 billion in cumulative net sales, and certain shareholders of One were granted warrants to purchase 522,009 shares of the Company’s common stock. The warrant for redeemable convertible preferred stock was remeasured prior to settlement. 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 $6.8 million at December 31, 2021). 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 (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 Company accounted for the 2020 One Amendment by derecognizing the carrying value of the warrant liability for redeemable convertible preferred stock on the date of the 2020 One Amendment, which had a fair value of approximately $6.0 million, and recognizing the consideration provided in the amendment, which had an aggregate fair value of approximately $5.8 million. The difference between the consideration provided by the Company and the warrant liability derecognized, approximately $0.2 million, represents a gain on settlement of the warrant liability and was recognized in other income (expense), net, on the accompanying consolidated statements of operations during the year ended December 31, 2020. As the contingent call option granted to One shareholders to buy back the 10% investment in One did not meet the definition of a derivate under ASC 815, Derivatives and Hedging, the Company recorded the grant date fair value of the call option, approximately $1.5 million, to other long-term liabilities on the consolidated balance sheets. Increases or decreases in fair value of the contingent call option are recorded in the consolidated statements of operations. The Company accounted for the common stock warrants under ASC 815, Derivatives and Hedging, which resulted in recording the grant date fair value of the common stock warrants, approximately $4.3 million, to additional paid in capital in the accompanying consolidated balance sheets. As the common stock warrants are equity-classified, the warrants are recorded at their initial fair value and not subsequently remeasured. The commercial milestone added as part of the 2020 One Amendment constitutes contingent consideration and was provided as additional consideration for a license or asset acquisition, representing one component of the consideration replacing the warrant liability previously provided as part of the consideration for the license. Under asset acquisition accounting, contingent consideration is not recognized until the contingency is resolved. As such, no amount was recognized for the contingent milestone on the date of the amendment. A summary of the gain on the warrant liability settlement that resulted from the 2020 One Amendment during the year ended December 31, 2020 is as follows (in thousands): Carrying value of warrants for redeemable convertible preferred stock $ 5,973 Fair value of common stock warrants, net of cash consideration paid of $10 (4,312) Fair value of contingent call option granted to One shareholders (1,494) Gain on warrant liability extinguishment $ 167 Research Innovation Fund (“RIF”) Financing In August 2020, the 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 $11.3 million at December 31, 2021) from RIF as an equity investment and €15.0 million (approximately $17.0 million at December 31, 2021) as a loan with a fixed interest rate of 6.35% per annum (see Note 12). The equity investment can be called by Gelesis, Inc., 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 December 31, 2021, RIF holds approximately 20% of the equity of Gelesis S.r.l. The Company concluded that Gelesis Inc. is the only equity investment at risk as RIF’s investment is not considered equity due to the call and put options. The Company further evaluated the sufficiency of the equity at risk and concluded that given the fact that Gelesis S.r.l. had to receive the RIF investment, which represents subordinated financial support but not equity, the fair value of Gelesis Inc. equity is not sufficient to absorb its expected losses resulting from its research and development operations and business plan, rather some of its expected losses will have to be absorbed by the RIF investment. The RIF investment is equity held by a noncontrolling interest. Since the put option does not make the equity mandatorily redeemable, and the call option is held by the Company, the noncontrolling interest is not considered mandatorily redeemable and as such, is not presented as a liability. The noncontrolling interest is therefore classified as temporary equity — noncontrolling interest, and is accounted for in accordance with ASC 810, Consolidation The noncontrolling interest is initially recorded at €10.0 million (approximately $11.3 million at transaction date, net of issuance costs of $0.4 million), the consideration allocated to the shareholder investment based on its fair value. The Company has applied ASC 810 to subsequently remeasure the noncontrolling interest, which results in no losses being attributed to the noncontrolling interest, rather, only earnings of the Gelesis S.r.l. entity based on the shareholder rights as a whole instrument. However, the noncontrolling interest shall not be reduced below the current redemption value of the put option, which represents the initial investment plus the accrued rate of return of 3.175% per annum. Adjustments to the noncontrolling interest that result from accreting the put option to its redemption value are recorded to accumulated deficit in the accompanying consolidated balance sheets. The Company recorded accretion of $0.6 million and foreign currency translation loss of $0.5 million to the noncontrolling interest during the year ended December 31, 2020. The Company recorded accretion of $0.4 million and foreign currency translation gain of $1.0 million to the noncontrolling interest during the year ended December 31, 2021. The noncontrolling interest balance was $11.9 million and $12.4 million at December 31, 2021 and 2020, respectively, in the accompanying consolidated balance sheets. |
Debt
Debt | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Debt Disclosure [Abstract] | ||
Debt | 12. Debt The Company’s non-convertible debt outstanding at June 30, 2022 and December 31, 2021 is summarized as follows: June 30, December 31, 2022 2021 Italian Economic Development Agency Loan 323 525 Intesa Sanpaolo Loan 1 7,384 8,507 Intesa Sanpaolo Loan 2 5,225 5,672 Horizon 2020 Loan 414 486 RIF Shareholders Loan 15,674 17,015 UniCredit Loan 5,188 5,630 Total debt obligation $ 34,208 $ 37,835 Unamortized loan discount and issuance costs (1,016) (754) Total debt obligation carrying amount $ 33,192 $ 37,081 Current portion $ 3,177 $ 1,950 Long-term portion $ 30,015 $ 35,131 2021 Bridge Financing On December 13, 2021, the Company issued convertible promissory notes to related parties in the principal amount of $27.0 million (see Note 20). At December 31, 2021, the outstanding balance was $27.1 million, recorded at fair value in the accompanying condensed consolidated balance sheets. On January 19, 2022 the Company settled the convertible promissory notes in cash for principal plus accrued interest in the aggregate amount of $27.3 million. During the six months ended June 30, 2022, the Company recognized a loss of $0.2 million with respect to the change in fair value of the convertible promissory notes on the accompanying condensed consolidated statements of operations. Future maturities with respect to debt outstanding at June 30, 2022 are as follows (in thousands): At June 30, 2022 Remaining 2022 obligation 1,362 2023 7,909 2024 5,315 2025 3,868 2026 3,889 More than 5 years 11,865 Total maturities $ 34,208 | |
Debt | 12. Debt The Company’s non-convertible debt outstanding at June 30, 2022 and December 31, 2021 is summarized as follows: June 30, December 31, 2022 2021 Italian Economic Development Agency Loan 323 525 Intesa Sanpaolo Loan 1 7,384 8,507 Intesa Sanpaolo Loan 2 5,225 5,672 Horizon 2020 Loan 414 486 RIF Shareholders Loan 15,674 17,015 UniCredit Loan 5,188 5,630 Total debt obligation $ 34,208 $ 37,835 Unamortized loan discount and issuance costs (1,016) (754) Total debt obligation carrying amount $ 33,192 $ 37,081 Current portion $ 3,177 $ 1,950 Long-term portion $ 30,015 $ 35,131 2021 Bridge Financing On December 13, 2021, the Company issued convertible promissory notes to related parties in the principal amount of $27.0 million (see Note 20). At December 31, 2021, the outstanding balance was $27.1 million, recorded at fair value in the accompanying condensed consolidated balance sheets. On January 19, 2022 the Company settled the convertible promissory notes in cash for principal plus accrued interest in the aggregate amount of $27.3 million. During the six months ended June 30, 2022, the Company recognized a loss of $0.2 million with respect to the change in fair value of the convertible promissory notes on the accompanying condensed consolidated statements of operations. Future maturities with respect to debt outstanding at June 30, 2022 are as follows (in thousands): At June 30, 2022 Remaining 2022 obligation 1,362 2023 7,909 2024 5,315 2025 3,868 2026 3,889 More than 5 years 11,865 Total maturities $ 34,208 | |
Gelesis | ||
Debt Disclosure [Abstract] | ||
Debt | 12. Debt Italian Economic Development Agency Loan In May 2014, the Company entered into a loan agreement with an Italian economic development agency in connection with a grant. In February 2016, the Company received a second tranche of financing under this loan agreement. Borrowings under the loan totaled €1.2 million (approximately $1.4 million at December 31, 2021), and the loan bears interest at 0.332% per annum. The Company is required to make annual principal and interest payments from January 2017 through January 2024. Intesa Sanpaolo Loan In November 2019, the Company entered into a loan agreement with Intesa Sanpaolo. Initial borrowings under the loan totaled €2.4 million (approximately $2.8 million at December 31, 2021), net of transaction costs of €0.1 million (approximately $0.1 million at December 31, 2021), and the loan bears interest at base rate of 2.3% plus the 3-month During the year ended December 31, 2020, the Company borrowed an additional €5.0 million (approximately $5.7 million at December 31, 2021), net of transaction costs of approximately €13,000 (approximately $14,000 at December 31, 2021). The additional borrowings under the loan had the same terms and repayment schedule as the November 2019 loan. In March 2021, the Company entered into another loan agreement with Intesa Sanpaolo for aggregate borrowing of up to €5.0 million. Borrowings under the second loan agreement upon closing and at December 31, 2021, totaled €4.8 million (approximately $5.4 million at December 31, 2021), net of transaction costs of €0.2 million (approximately $0.2 million at December 31, 2021), and the loan bears interest at base rate of 0.701%. The Company is required to make payments of interest only on borrowings under the loan agreement on a monthly basis through March 2023 (the interest only termination date), after which payments of principal in equal monthly installments and accrued interest will be due until the loan matures on March 26, 2024. Horizon 2020 Loan In December 2019, as part of the Horizon 2020 Grant (see Note 11), the Company entered into a loan agreement with the Italian Finance Ministry. Borrowings under the loan totaled €0.3 million (approximately $0.3 million at December 31, 2021), net of transaction costs and discounts of approximately €21,000 (approximately $24,000 at December 31, 2021), and the loan bears interest at 0.171% per annum. The Company is required to make payments of interest only on borrowings under the loan agreement on a semiannual basis through and including June 30, 2020 (the interest only termination date), after which payments of principal in equal semiannual installments and accrued interest will be due until the loan matures on June 30, 2028. In October 2020, the Company borrowed an additional €0.2 million (approximately $0.2 million at December 31, 2021), net of transaction costs of approximately €19,000 (approximately $22,000 at December 31, 2021). The additional borrowings under the loan had the same terms and repayment schedule as the December 2019 loan. RIF Shareholders Loan In August 2020, as part of the RIF financing transaction (see Note 11), the Company entered into a loan agreement with the shareholders of RIF. Borrowings under the loan totaled €14.5 million (approximately $16.4 million at December 31, 2021), net of transaction costs of €0.5 million (approximately $0.6 million at December 31, 2021), and the loan bears interest at 6.35% per annum. The Company is required to make payments of interest only on borrowings under the loan agreement on an annual basis starting December 31, 2020 and through and including December 30, 2022 (the interest only termination date), after which payments of principal in equal annual installments and accrued interest will be due until the loan matures on December 31, 2030. If either party exercises its call option or put option on the equity investment as part of the RIF Transaction, the unpaid principal and accrued interest as of that date must be paid by the Company. UniCredit Loan In November 2020, the Company entered into a loan agreement with UniCredit. Borrowings under the loan totaled €4.9 million (approximately $5.7 million at December 31, 2021), net of transaction costs and discounts of €0.1 million (approximately $0.1 million at December 31, 2021), and the loan bears interest at 2.12% per annum. The Company is required to make payments of principal and accrued interest on a semiannual basis starting December 10, 2021 until the loan matures on December 10, 2027. PPP Loan On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was enacted to, amongst other provisions, provide emergency assistance for individuals, families and businesses affected by the COVID-19 pandemic. The CARES Act includes a Paycheck Protection Program (“PPP”) administered through the Small Business Association (“SBA”). Under the PPP, beginning April 3, 2020, small businesses and other entities and individuals could apply for loans from existing SBA lenders and other approved regulated lenders that enroll in the program, subject to numerous limitations and eligibility criteria. In April 2020, the Company issued a promissory note to Silicon Valley Bank, pursuant to which it received loan proceeds of $0.3 million (the “PPP Loan”) provided under the PPP established under the CARES Act and guaranteed by the U.S. Small Business Administration. In November 2020, the Company was notified by Silicon Valley Bank that the PPP Loan had been fully forgiven by the SBA and there is no remaining balance on its account. The Company recognized income of $0.3 million in other income on the consolidated statements of operations during the year ended December 31, 2020, for debt extinguishment pursuant to ASC 470, Debt 2021 Bridge Financing On December 13, 2021, the Company entered into a bridge financing arrangement, executing convertible promissory note agreements for $12.0 million with SSD2 an existing investor and related party (see Note 20) and $15.0 million with PureTech, an existing investor and related party (see Note 20). These promissory notes bear interest at 10% and shall be settled in cash for principal plus accrued interest by the third (3rd) business day following the Business Combination Closing Agreement with CPSR, or thirty (30) days following the termination of the Business Combination Agreement. In the event the Business Combination Agreement is terminated, the majority holders of the promissory notes may elect to convert outstanding principal and interest into the securities being issued and sold to investors in a subsequent qualified financing at a discounted conversion price equal to 75% of the price per share paid by other investors in the financing. The Company elected to recognize the hybrid instrument at fair value at issuance and record subsequent changes in fair value in the accompanying consolidated statements of operations (see Note 3). At issuance the Company determined the aggregate fair value of the convertibles promissory notes was $27.0 million. At December 31, 2021, the fair value was determined to be $27.1 million. During the year ended December 31, 2021, the Company recognized a loss of $0.1 million with respect to the change in fair value of the convertible promissory notes on the accompanying consolidated statements of operations. Future maturities with respect to non-convertible debt outstanding at December 31, 2021 are as follows (in thousands): At December 31, 2021 2022 2,183 2023 8,585 2024 5,771 2025 4,199 2026 4,221 More than 5 years 12,877 Unamortized loan discount and issuance costs (754) Total obligation $ 37,081 | |
Debt | 12. Debt Italian Economic Development Agency Loan In May 2014, the Company entered into a loan agreement with an Italian economic development agency in connection with a grant. In February 2016, the Company received a second tranche of financing under this loan agreement. Borrowings under the loan totaled €1.2 million (approximately $1.4 million at December 31, 2021), and the loan bears interest at 0.332% per annum. The Company is required to make annual principal and interest payments from January 2017 through January 2024. Intesa Sanpaolo Loan In November 2019, the Company entered into a loan agreement with Intesa Sanpaolo. Initial borrowings under the loan totaled €2.4 million (approximately $2.8 million at December 31, 2021), net of transaction costs of €0.1 million (approximately $0.1 million at December 31, 2021), and the loan bears interest at base rate of 2.3% plus the 3-month During the year ended December 31, 2020, the Company borrowed an additional €5.0 million (approximately $5.7 million at December 31, 2021), net of transaction costs of approximately €13,000 (approximately $14,000 at December 31, 2021). The additional borrowings under the loan had the same terms and repayment schedule as the November 2019 loan. In March 2021, the Company entered into another loan agreement with Intesa Sanpaolo for aggregate borrowing of up to €5.0 million. Borrowings under the second loan agreement upon closing and at December 31, 2021, totaled €4.8 million (approximately $5.4 million at December 31, 2021), net of transaction costs of €0.2 million (approximately $0.2 million at December 31, 2021), and the loan bears interest at base rate of 0.701%. The Company is required to make payments of interest only on borrowings under the loan agreement on a monthly basis through March 2023 (the interest only termination date), after which payments of principal in equal monthly installments and accrued interest will be due until the loan matures on March 26, 2024. Horizon 2020 Loan In December 2019, as part of the Horizon 2020 Grant (see Note 11), the Company entered into a loan agreement with the Italian Finance Ministry. Borrowings under the loan totaled €0.3 million (approximately $0.3 million at December 31, 2021), net of transaction costs and discounts of approximately €21,000 (approximately $24,000 at December 31, 2021), and the loan bears interest at 0.171% per annum. The Company is required to make payments of interest only on borrowings under the loan agreement on a semiannual basis through and including June 30, 2020 (the interest only termination date), after which payments of principal in equal semiannual installments and accrued interest will be due until the loan matures on June 30, 2028. In October 2020, the Company borrowed an additional €0.2 million (approximately $0.2 million at December 31, 2021), net of transaction costs of approximately €19,000 (approximately $22,000 at December 31, 2021). The additional borrowings under the loan had the same terms and repayment schedule as the December 2019 loan. RIF Shareholders Loan In August 2020, as part of the RIF financing transaction (see Note 11), the Company entered into a loan agreement with the shareholders of RIF. Borrowings under the loan totaled €14.5 million (approximately $16.4 million at December 31, 2021), net of transaction costs of €0.5 million (approximately $0.6 million at December 31, 2021), and the loan bears interest at 6.35% per annum. The Company is required to make payments of interest only on borrowings under the loan agreement on an annual basis starting December 31, 2020 and through and including December 30, 2022 (the interest only termination date), after which payments of principal in equal annual installments and accrued interest will be due until the loan matures on December 31, 2030. If either party exercises its call option or put option on the equity investment as part of the RIF Transaction, the unpaid principal and accrued interest as of that date must be paid by the Company. UniCredit Loan In November 2020, the Company entered into a loan agreement with UniCredit. Borrowings under the loan totaled €4.9 million (approximately $5.7 million at December 31, 2021), net of transaction costs and discounts of €0.1 million (approximately $0.1 million at December 31, 2021), and the loan bears interest at 2.12% per annum. The Company is required to make payments of principal and accrued interest on a semiannual basis starting December 10, 2021 until the loan matures on December 10, 2027. PPP Loan On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was enacted to, amongst other provisions, provide emergency assistance for individuals, families and businesses affected by the COVID-19 pandemic. The CARES Act includes a Paycheck Protection Program (“PPP”) administered through the Small Business Association (“SBA”). Under the PPP, beginning April 3, 2020, small businesses and other entities and individuals could apply for loans from existing SBA lenders and other approved regulated lenders that enroll in the program, subject to numerous limitations and eligibility criteria. In April 2020, the Company issued a promissory note to Silicon Valley Bank, pursuant to which it received loan proceeds of $0.3 million (the “PPP Loan”) provided under the PPP established under the CARES Act and guaranteed by the U.S. Small Business Administration. In November 2020, the Company was notified by Silicon Valley Bank that the PPP Loan had been fully forgiven by the SBA and there is no remaining balance on its account. The Company recognized income of $0.3 million in other income on the consolidated statements of operations during the year ended December 31, 2020, for debt extinguishment pursuant to ASC 470, Debt 2021 Bridge Financing On December 13, 2021, the Company entered into a bridge financing arrangement, executing convertible promissory note agreements for $12.0 million with SSD2 an existing investor and related party (see Note 20) and $15.0 million with PureTech, an existing investor and related party (see Note 20). These promissory notes bear interest at 10% and shall be settled in cash for principal plus accrued interest by the third (3rd) business day following the Business Combination Closing Agreement with CPSR, or thirty (30) days following the termination of the Business Combination Agreement. In the event the Business Combination Agreement is terminated, the majority holders of the promissory notes may elect to convert outstanding principal and interest into the securities being issued and sold to investors in a subsequent qualified financing at a discounted conversion price equal to 75% of the price per share paid by other investors in the financing. The Company elected to recognize the hybrid instrument at fair value at issuance and record subsequent changes in fair value in the accompanying consolidated statements of operations (see Note 3). At issuance the Company determined the aggregate fair value of the convertibles promissory notes was $27.0 million. At December 31, 2021, the fair value was determined to be $27.1 million. During the year ended December 31, 2021, the Company recognized a loss of $0.1 million with respect to the change in fair value of the convertible promissory notes on the accompanying consolidated statements of operations. Future maturities with respect to non-convertible debt outstanding at December 31, 2021 are as follows (in thousands): At December 31, 2021 2022 2,183 2023 8,585 2024 5,771 2025 4,199 2026 4,221 More than 5 years 12,877 Unamortized loan discount and issuance costs (754) Total obligation $ 37,081 |
Warrant Liabilities
Warrant Liabilities | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Warrants And Rights Note Disclosure [Abstract] | ||
Warrants | 13. Warrant Liabilities The following represents a summary of the warrant liabilities activity during the six months ended June 30, 2022: Series A-4 Private Placement Warrants Warrants Total Balance at December 31, 2021 $ 15,821 $ — $ 15,821 Assumed upon Business Combination — 8,140 8,140 Changes in fair value 926 (7,010) (6,084) Conversion and exchange upon Business Combination (16,747) — (16,747) Balance at June 30, 2022 $ — $ 1,130 $ 1,130 Private Placement Warrants At June 30, 2022, 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 June 30, 2022, 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 June 30, 2022: Private Placement Warrants Expected term 4.5 years Expected volatility 62.0 % Expected dividend yield 0.0 % Risk free interest rate 3.0 % Price of Gelesis Common Stock $ 1.55 Exercise price of warrants $ 11.50 Legacy Gelesis Redeemable Preferred Stock Warrants In connection with the Business Combination, Legacy Gelesis redeemable preferred stock warrants were reclassified from liability treatment to equity treatment pursuant to the terms of their exchange (see Note 15). | NOTE 8. WARRANTS As of December 31, 2021 and 2020, there were 13,800,000 Public Warrants outstanding. Public Warrants may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only whole warrants will trade. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination or (b) 12 months from the closing of the Initial Public Offering. The Public Warrants will expire five years after the completion of a Business Combination or earlier upon redemption or liquidation. The Company will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act covering the issuance of the shares of Class A common issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available, subject to the Company satisfying its obligations with respect to registration. No warrant will be exercisable and we will not be obligated to issue shares of Class A common stock upon exercise of a warrant unless Class A common stock issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants. The Company has agreed that as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, the Company will use its best efforts to file with the SEC a registration statement covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants to cause such registration statement to become effective and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during any period when the Company will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. Once the warrants become exercisable, the Company may redeem the Public Warrants: ● in whole and not in part; ● at a price of $0.01 per warrant; ● upon not less than 30 days ’ prior written notice of redemption to each warrant holder; and ● if, and only if, the reported last sale price of the Company’s Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30- trading day period ending three business days before the Company sends the notice of redemption to the warrant holders. If and when the warrants become redeemable by the Company, the Company may not exercise its redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or the Company is unable to effect such registration or qualification. If the Company calls the Public Warrants for redemption, management 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. The exercise price and number of shares of Class A common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, or recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be adjusted for issuance of Class A common stock at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire worthless. In addition, if (x) the Company issues additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per share (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors and, in the case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares held by the sponsor or such affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s common stock during the 20 trading day period starting on the trading day prior to the day on which the Company consummates a Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. As of December 31, 2021 and 2020, there were 7,520,000 Private Placement Warrants outstanding. The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A common stock issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. |
Earnout Liability
Earnout Liability | 6 Months Ended |
Jun. 30, 2022 | |
Derivative Instrument Detail [Abstract] | |
Earnout Liability | 14. Earnout Liability The following represents a summary of the earnout liability activity during the six months ended June 30, 2022: Earnout Liability Balance at December 31, 2021 $ — Recognized upon Business Combination 58,871 Changes in fair value (52,681) Balance at June 30, 2022 $ 6,190 At Business Combination close and at June 30, 2022, there were 18,758,241 earnout shares underlying the liability, which were unissued and unvested. At June 30, 2022, 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 June 30, 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 June 30, 2022: Earnout Liability Expected term 4.5 years Expected volatility 62.0 % Expected dividend yield 0.0 % Risk free interest rate 3.0 % Price of Gelesis Common Stock $ 1.55 |
Stockholder's Equity (Deficit)
Stockholder's Equity (Deficit) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Stockholders Equity Note [Abstract] | ||
Stockholder's Equity (Deficit) | 15. Stockholder’s 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 June 30, 2022 Legacy Redeemable Convertible Preferred Stock At December 31, 2021 and immediately prior to the Business Combination, Legacy Gelesis had outstanding Series A-1, Series A-2, Series A-3, Series A-4, Series A-5, Series Growth, Series 2 Growth and Series 3 Growth redeemable convertible preferred stock which are collectively referred to as “redeemable convertible preferred stock.” Immediately prior to the closing of the Business Combination, Legacy Gelesis redeemable convertible preferred stock converted into Legacy Gelesis common stock and was 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. 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 at 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 June 30, 2022, 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 rollover common stock warrants of the Company on a one-to-one basis. At close of Business Combination and June 30, 2022, there were 1,836,429 and 1,660,303 rollover warrants outstanding, respectively, with an exercise price of $0.02. During the six months ended June 30, 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 at June 30, 2022, respectively, there were 1,353,062 of these warrants outstanding with an exercise price of $4.26. At June 30, 2022 and December 31, 2021 common stock reserved for future issuances was as follows: June 30, December 31, 2022 2021 Common stock issued upon option exercise and RSUs vesting 20,000,493 13,486,708 Conversion of all classes of redeemable convertible preferred stock — 48,566,655 Issuances upon exercise of warrants to purchase Series A-4, upon conversion to common warrants — 1,836,429 Issuances upon exercise of common stock warrants 24,333,365 1,353,062 Earnout shares 23,482,845 — Total common stock reserved for future issuance 67,816,703 65,242,854 | NOTE 7. STOCKHOLDERS’ DEFICIT Preferred Stock Class A Common Stock Class B Common Stock Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, and any private placement-equivalent warrants issued to the Sponsor or its affiliates upon conversion of loans made to the Company). |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | 16. 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, 2,370,188 shares remained available for issuance at June 30, 2022. 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 four years 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): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Research and development $ 3,008 $ 494 $ 8,073 $ 1,061 Selling, general and administrative 4,968 1,145 13,892 2,033 Total $ 7,976 $ 1,639 $ 21,965 $ 3,094 Stock Option Activity The following table summarizes the Company’s stock option activity during the six months ended June 30, 2022: Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price per Contractual Intrinsic Value Options Share Term (Years) (in thousands) Outstanding at December 31, 2021 4,889,820 $ 10.39 6.17 $ 54,449 Retroactive application of reverse recapitalization 7,784,666 (6.38) Adjusted and Outstanding at December 31, 2021 12,674,486 $ 4.01 6.17 $ 54,449 Granted 2,658,185 $ 3.35 Exercised (162,064) $ 0.68 Forfeited - unvested (17,281) $ 5.56 Forfeited - vested (63,718) $ 4.31 Expired (456,534) $ 1.23 Outstanding at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 Exercisable at June 30, 2022 9,780,237 $ 3.81 5.43 $ 840 Vested and Expected to Vest at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 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 six months ended June 30, 2022 was $2.4 million. The fair value of each option issued was estimated at the date of grant using Black-Scholes with the following weighted-average assumptions: Six Month Ended June 30, 2022 Market price of common stock $ 3.35 Expected volatility 72.4 % Expected term (in years) 6.1 Risk-free interest rate 1.7 % Expected dividend yield 0.0 % The weighted-average grant date fair value of stock options granted during the six months ended June 30, 2022 was $2.17. At June 30, 2022 and December 31, 2021, there was $13.7 million and $8.7 million, respectively, of 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 2.4 and 2.2 years, respectively. Restricted Stock Unit (“RSU”) Activity The following table summarizes the Company’s RSU activity during the six months ended June 30, 2022: Weighted- Average Grant Date Number of RSUs Fair Value Outstanding and Unvested at December 31, 2021 313,354 $ 21.41 Retroactive application of reverse recapitalization 498,868 $ (13.15) Adjusted and Outstanding and Unvested at December 31, 2021 812,222 $ 8.26 Granted 4,555,197 $ 3.46 Vested (17,654) $ 8.26 Forfeited — Outstanding and Unvested at June 30, 2022 5,349,765 $ 4.18 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 or 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 June 30, 2022 and December 31, 2021, unrecognized compensation cost for RSU awards granted totaled $16.0 million and $6.7 million, respectively, which was expected to be recognized over a weighted-average period of 2.8 and 0.9 years, respectively. |
Stock-based Compensation | 16. 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, 2,370,188 shares remained available for issuance at June 30, 2022. 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 four years 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): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Research and development $ 3,008 $ 494 $ 8,073 $ 1,061 Selling, general and administrative 4,968 1,145 13,892 2,033 Total $ 7,976 $ 1,639 $ 21,965 $ 3,094 Stock Option Activity The following table summarizes the Company’s stock option activity during the six months ended June 30, 2022: Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price per Contractual Intrinsic Value Options Share Term (Years) (in thousands) Outstanding at December 31, 2021 4,889,820 $ 10.39 6.17 $ 54,449 Retroactive application of reverse recapitalization 7,784,666 (6.38) Adjusted and Outstanding at December 31, 2021 12,674,486 $ 4.01 6.17 $ 54,449 Granted 2,658,185 $ 3.35 Exercised (162,064) $ 0.68 Forfeited - unvested (17,281) $ 5.56 Forfeited - vested (63,718) $ 4.31 Expired (456,534) $ 1.23 Outstanding at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 Exercisable at June 30, 2022 9,780,237 $ 3.81 5.43 $ 840 Vested and Expected to Vest at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 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 six months ended June 30, 2022 was $2.4 million. The fair value of each option issued was estimated at the date of grant using Black-Scholes with the following weighted-average assumptions: Six Month Ended June 30, 2022 Market price of common stock $ 3.35 Expected volatility 72.4 % Expected term (in years) 6.1 Risk-free interest rate 1.7 % Expected dividend yield 0.0 % The weighted-average grant date fair value of stock options granted during the six months ended June 30, 2022 was $2.17. At June 30, 2022 and December 31, 2021, there was $13.7 million and $8.7 million, respectively, of 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 2.4 and 2.2 years, respectively. Restricted Stock Unit (“RSU”) Activity The following table summarizes the Company’s RSU activity during the six months ended June 30, 2022: Weighted- Average Grant Date Number of RSUs Fair Value Outstanding and Unvested at December 31, 2021 313,354 $ 21.41 Retroactive application of reverse recapitalization 498,868 $ (13.15) Adjusted and Outstanding and Unvested at December 31, 2021 812,222 $ 8.26 Granted 4,555,197 $ 3.46 Vested (17,654) $ 8.26 Forfeited — Outstanding and Unvested at June 30, 2022 5,349,765 $ 4.18 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 or 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 June 30, 2022 and December 31, 2021, unrecognized compensation cost for RSU awards granted totaled $16.0 million and $6.7 million, respectively, which was expected to be recognized over a weighted-average period of 2.8 and 0.9 years, respectively. |
Income Taxes
Income Taxes | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Income Taxes | 17. Income Taxes The Company did not record a provision during the three months and the six months ended June 30, 2022 and June 30, 2021, respectively. The provision recorded differs from the US statutory rate of 21% for the three months and six months ended June 30, 2022 and June 30, 2021 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 June 30, 2022 and December 31, 2021, respectively. | NOTE 9 — INCOME TAX The Company’s net deferred tax assets are as follows: December 31, December 31, 2021 2020 Deferred tax assets (liabilities) Net operating loss carryforward $ 9,695 $ 36,961 Startup/Organizational expenses 488,923 472,542 Unrealized gain on marketable securities (4,382) (43,985) Total deferred tax assets 494,236 465,518 Valuation allowance (494,236) (465,518) Deferred tax assets, net of valuation allowance $ — $ — The income tax provision for the year ended December 31, 2021 and 2020 consists of the following: December 31, December 31, 2021 2020 Federal Current $ — $ — Deferred (28,719) (465,518) State and Local Current — — Deferred — — Change in valuation allowance 28,719 465,518 Income tax provision $ — $ — As of December 31, 2020 and December 31, 2021, the Company had $176,006 and $46,167 of federal net operating loss carryovers, respectively, which can be carried forward indefinitely, available to offset future taxable income. In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the year ended December 31, 2021, the change in the valuation allowance was $28,719. For the period from July 7, 2020 through December 31, 2020, the change in the valuation allowance was $465,518 . A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2021 and 2020 is as follows: December 31, 2021 December 31, 2020 Statutory federal income tax rate 21.0 % 21.0 % State taxes, net of federal tax benefit 0.0 % 0.0 % Business combination expense (33.19) % — Change in fair value of warrants 12.38 % 0.0 % Transaction costs incurred in connection with warrant liabilities — (0.0) % Valuation allowance (0.19) % (21.0) % Income tax provision 0.0 % 0.0 % The Company files income tax returns in the U.S. federal jurisdiction and is subject to examination by the various taxing authorities. The Company’s tax returns for the year ended December 31, 2021 and 2020 remain open to examination by the taxing authorities. The Company considers Texas to be a significant state tax jurisdiction. |
INCOME TAX | 17. Income Taxes The Company did not record a provision during the three months and the six months ended June 30, 2022 and June 30, 2021, respectively. The provision recorded differs from the US statutory rate of 21% for the three months and six months ended June 30, 2022 and June 30, 2021 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 June 30, 2022 and December 31, 2021, respectively. | NOTE 9 — INCOME TAX The Company’s net deferred tax assets are as follows: December 31, December 31, 2021 2020 Deferred tax assets (liabilities) Net operating loss carryforward $ 9,695 $ 36,961 Startup/Organizational expenses 488,923 472,542 Unrealized gain on marketable securities (4,382) (43,985) Total deferred tax assets 494,236 465,518 Valuation allowance (494,236) (465,518) Deferred tax assets, net of valuation allowance $ — $ — The income tax provision for the year ended December 31, 2021 and 2020 consists of the following: December 31, December 31, 2021 2020 Federal Current $ — $ — Deferred (28,719) (465,518) State and Local Current — — Deferred — — Change in valuation allowance 28,719 465,518 Income tax provision $ — $ — As of December 31, 2020 and December 31, 2021, the Company had $176,006 and $46,167 of federal net operating loss carryovers, respectively, which can be carried forward indefinitely, available to offset future taxable income. In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the year ended December 31, 2021, the change in the valuation allowance was $28,719. For the period from July 7, 2020 through December 31, 2020, the change in the valuation allowance was $465,518 . A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2021 and 2020 is as follows: December 31, 2021 December 31, 2020 Statutory federal income tax rate 21.0 % 21.0 % State taxes, net of federal tax benefit 0.0 % 0.0 % Business combination expense (33.19) % — Change in fair value of warrants 12.38 % 0.0 % Transaction costs incurred in connection with warrant liabilities — (0.0) % Valuation allowance (0.19) % (21.0) % Income tax provision 0.0 % 0.0 % The Company files income tax returns in the U.S. federal jurisdiction and is subject to examination by the various taxing authorities. The Company’s tax returns for the year ended December 31, 2021 and 2020 remain open to examination by the taxing authorities. The Company considers Texas to be a significant state tax jurisdiction. |
Gelesis | ||
Income Tax Disclosure [Abstract] | ||
Income Taxes | 17. Income Taxes Consolidated (loss) income before income taxes on a geographic basis during the years ended December 31, 2021 and 2020 are as follows (in thousands): Year Ended December 31 2021 2020 United States $ (86,693) $ (19,658) Non-U.S. (6,637) (4,208) Total $ (93,330) $ (23,866) The provision for income taxes consists of the following components during the years ended December 31, 2021 and 2020 (in thousands): Year Ended December 31, 2021 2020 Current tax expense (benefit): U.S. federal $ — $ — Foreign 17 (24) Total current tax expense (benefit) 17 (24) Deferred tax expense: U.S. federal — — State — — Foreign — 2,063 Total deferred tax benefit — 2,063 Total provision for income taxes $ 17 $ 2,039 A reconciliation setting forth the differences between the effective tax rates of the Company for the years ended December 31, 2021 and 2020 and the U.S. federal statutory tax rate is as follows: Year Ended December 31, 2021 2020 U.S. Federal income tax provision expense at statutory rate 21.0 % 21.0 % Effect of nondeductible stock-based compensation 0.8 % (1.9) % Foreign rate differential 0.2 % 2.2 % Mark to market of warrant liabilities (1.7) % (1.3) % State taxes net of federal benefit 4.3 % 4.5 % Non-deductible financing expenses (0.3) % 0.4 % Valuation allowance (24.2) % (38.3) % Investment transfer 0.0 % 6.8 % Other differences (0.4) % (0.4) % US federal and state research credits 0.4 % 1.6 % Uncertain tax positions (0.1) % (1.1) % Foreign earnings includible in US 0.0 % (2.0) % Effective income tax rate 0.0 % (8.5) % Significant components of the Company’s consolidated deferred tax assets and liabilities at December 31, 2021 and 2020 are as follows at (in thousands): At December 31, 2021 2020 Deferred tax assets: Federal net operating loss carryforwards $ 40,469 $ 24,730 State net operating loss carryforwards 10,643 7,207 Equity compensation 5,620 4,353 Accruals and reserves — 26 Uncollected grants 998 712 Investment in subsidiaries 3,820 3,931 Research credits 1,578 1,298 Other assets 152 46 Deferred income 239 — Interest 257 — Deferred rent 547 600 Total deferred tax assets 64,323 42,903 Valuation allowance (59,841) (37,427) Total deferred tax assets net of valuation allowance 4,482 5,476 Deferred tax liabilities: Intangible assets and amortization (3,932) (4,680) Right-of-Use asset (536) (591) Other liabilities (14) (204) Total deferred tax liabilities (4,482) (5,476) Net deferred tax assets $ — $ — Deferred income taxes reflect the net tax effect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amount used for income tax purposes. At December 31, 2021 and 2020, the Company has federal net operating loss carryforwards totaling $184.6 million and $114.4 million, respectively, of which $63.5 million expire in 2027 through 2037 and $121.1 million do not expire. At December 31, 2021 and 2020, the Company has state net operating loss carryforwards totaling $168.4 million and $114.0 million, respectively, which expire in 2030 through 2041, as well as other temporary differences and attributes that will be available to offset regular taxable income during the carryforward period. At December 31, 2021, the Company has foreign net operating loss carryforwards of $7.1 million which do not expire. Under the provisions of the Internal Revenue Code, the net operating loss and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. Net operating loss and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code, respectively, as well as similar state provisions. This could limit the amount of tax attributes that can be utilized annually to offset future taxable income or tax liabilities. The amount of the annual limitation is determined based on the value of the Company immediately prior to the ownership change. Subsequent ownership changes may further affect the limitation in future years. The Company has not completed a change in control analysis, as defined under Sections 382 and 383 of the Internal Revenue Code, through December 31, 2021 and has not determined whether the future utilization of net operating loss carryforwards may be materially limited based upon past financings. In addition, the Company may complete future financings that could result in an ownership change, which may limit the Company’s ability to utilize its tax attributes. The Company files income tax returns in Italy, the United States and in various state jurisdictions with varying statutes of limitations. Due to net operating losses incurred, the Company’s tax returns from inception to date are subject to examination by taxing authorities. The Company has evaluated 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. Additionally, the Company has determined that it is not more likely than not that the Company will recognize the benefits of the net deferred tax assets in Italy, primarily due to uncertainty regarding continued funding of the operations of Italy and from the restructuring of the intercompany services agreement between Gelesis, Inc., and Gelesis S.r.l., in connection with the RIF financing (see Note 11). As a result, the Company recorded a deferred tax provision of approximately $2.0 million in Italy during the year ended December 31, 2020 to establish a full valuation allowance against the balance of net deferred tax assets in Italy and maintains a full valuation allowance against the balance of net deferred tax assets in Italy as of December 31, 2021. The Company will continue to evaluate all positive and negative evidence each period. The change in the valuation allowance during the years ended December 31, 2021 and 2020 was an increase of $22.4 million and $9.1 million, respectively. The increase in the valuation allowance during the year ended December 31, 2021 and 2020 primarily relates to an increase in net operating losses in both years as well as the establishment of a full valuation allowance in the Italian subsidiary during the year ended December 31, 2020. The Company generally considers all earnings generated in Italy to be indefinitely reinvested. Therefore, the Company does not accrue U.S. taxes on the repatriation of the foreign earnings it considers to be indefinitely reinvested outside of the U.S. At December 31, 2021, the Company had not provided for federal income tax on $7.5 million of accumulated undistributed earnings of its foreign subsidiaries. In the event the Company were to repatriate the foreign earnings, the Company does not estimate the repatriation being subject to taxation. The Company follows the provisions of ASC 740-10, Accounting for Uncertainty in Income Taxes, which specifies how tax benefits for uncertain tax positions are to be recognized, measured, and recorded in financial statements; requires certain disclosures of uncertain tax matters; specifies how reserves for uncertain tax positions should be classified on the balance sheet; and provides transition and interim period guidance, among other provisions. At December 31, 2021 and 2020, the Company has not recorded any liability for uncertain tax positions which relate primarily to certain federal and state research tax credits. The Company presents the uncertain tax positions as a reduction to the gross deferred tax assets with respect to research credits. The Company’s policy is to recognize interest and penalties accrued on any uncertain tax positions as a component of income tax expense, if any, in its consolidated statements of operations. For the years ended December 31, 2021 and 2020, no estimated interest or penalties were recognized on uncertain tax positions. The Company does not expect that the amounts of uncertain tax positions will change significantly within the next twelve months. A reconciliation of the beginning and ending amount of uncertain tax positions is as follows (in thousands): Year Ended December 31, 2021 2020 Unrecognized tax benefits at the beginning of year $ (281) $ — Increase for current year positions (71) (82) Increase for prior year positions — (199) Expiration of statute of limitations — — Unrecognized tax benefits at the end of year (352) (281) Gross research credit tax assets 1,930 1,579 Net research credit tax assets $ 1,578 $ 1,298 | |
INCOME TAX | 17. Income Taxes Consolidated (loss) income before income taxes on a geographic basis during the years ended December 31, 2021 and 2020 are as follows (in thousands): Year Ended December 31 2021 2020 United States $ (86,693) $ (19,658) Non-U.S. (6,637) (4,208) Total $ (93,330) $ (23,866) The provision for income taxes consists of the following components during the years ended December 31, 2021 and 2020 (in thousands): Year Ended December 31, 2021 2020 Current tax expense (benefit): U.S. federal $ — $ — Foreign 17 (24) Total current tax expense (benefit) 17 (24) Deferred tax expense: U.S. federal — — State — — Foreign — 2,063 Total deferred tax benefit — 2,063 Total provision for income taxes $ 17 $ 2,039 A reconciliation setting forth the differences between the effective tax rates of the Company for the years ended December 31, 2021 and 2020 and the U.S. federal statutory tax rate is as follows: Year Ended December 31, 2021 2020 U.S. Federal income tax provision expense at statutory rate 21.0 % 21.0 % Effect of nondeductible stock-based compensation 0.8 % (1.9) % Foreign rate differential 0.2 % 2.2 % Mark to market of warrant liabilities (1.7) % (1.3) % State taxes net of federal benefit 4.3 % 4.5 % Non-deductible financing expenses (0.3) % 0.4 % Valuation allowance (24.2) % (38.3) % Investment transfer 0.0 % 6.8 % Other differences (0.4) % (0.4) % US federal and state research credits 0.4 % 1.6 % Uncertain tax positions (0.1) % (1.1) % Foreign earnings includible in US 0.0 % (2.0) % Effective income tax rate 0.0 % (8.5) % Significant components of the Company’s consolidated deferred tax assets and liabilities at December 31, 2021 and 2020 are as follows at (in thousands): At December 31, 2021 2020 Deferred tax assets: Federal net operating loss carryforwards $ 40,469 $ 24,730 State net operating loss carryforwards 10,643 7,207 Equity compensation 5,620 4,353 Accruals and reserves — 26 Uncollected grants 998 712 Investment in subsidiaries 3,820 3,931 Research credits 1,578 1,298 Other assets 152 46 Deferred income 239 — Interest 257 — Deferred rent 547 600 Total deferred tax assets 64,323 42,903 Valuation allowance (59,841) (37,427) Total deferred tax assets net of valuation allowance 4,482 5,476 Deferred tax liabilities: Intangible assets and amortization (3,932) (4,680) Right-of-Use asset (536) (591) Other liabilities (14) (204) Total deferred tax liabilities (4,482) (5,476) Net deferred tax assets $ — $ — Deferred income taxes reflect the net tax effect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amount used for income tax purposes. At December 31, 2021 and 2020, the Company has federal net operating loss carryforwards totaling $184.6 million and $114.4 million, respectively, of which $63.5 million expire in 2027 through 2037 and $121.1 million do not expire. At December 31, 2021 and 2020, the Company has state net operating loss carryforwards totaling $168.4 million and $114.0 million, respectively, which expire in 2030 through 2041, as well as other temporary differences and attributes that will be available to offset regular taxable income during the carryforward period. At December 31, 2021, the Company has foreign net operating loss carryforwards of $7.1 million which do not expire. Under the provisions of the Internal Revenue Code, the net operating loss and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. Net operating loss and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code, respectively, as well as similar state provisions. This could limit the amount of tax attributes that can be utilized annually to offset future taxable income or tax liabilities. The amount of the annual limitation is determined based on the value of the Company immediately prior to the ownership change. Subsequent ownership changes may further affect the limitation in future years. The Company has not completed a change in control analysis, as defined under Sections 382 and 383 of the Internal Revenue Code, through December 31, 2021 and has not determined whether the future utilization of net operating loss carryforwards may be materially limited based upon past financings. In addition, the Company may complete future financings that could result in an ownership change, which may limit the Company’s ability to utilize its tax attributes. The Company files income tax returns in Italy, the United States and in various state jurisdictions with varying statutes of limitations. Due to net operating losses incurred, the Company’s tax returns from inception to date are subject to examination by taxing authorities. The Company has evaluated 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. Additionally, the Company has determined that it is not more likely than not that the Company will recognize the benefits of the net deferred tax assets in Italy, primarily due to uncertainty regarding continued funding of the operations of Italy and from the restructuring of the intercompany services agreement between Gelesis, Inc., and Gelesis S.r.l., in connection with the RIF financing (see Note 11). As a result, the Company recorded a deferred tax provision of approximately $2.0 million in Italy during the year ended December 31, 2020 to establish a full valuation allowance against the balance of net deferred tax assets in Italy and maintains a full valuation allowance against the balance of net deferred tax assets in Italy as of December 31, 2021. The Company will continue to evaluate all positive and negative evidence each period. The change in the valuation allowance during the years ended December 31, 2021 and 2020 was an increase of $22.4 million and $9.1 million, respectively. The increase in the valuation allowance during the year ended December 31, 2021 and 2020 primarily relates to an increase in net operating losses in both years as well as the establishment of a full valuation allowance in the Italian subsidiary during the year ended December 31, 2020. The Company generally considers all earnings generated in Italy to be indefinitely reinvested. Therefore, the Company does not accrue U.S. taxes on the repatriation of the foreign earnings it considers to be indefinitely reinvested outside of the U.S. At December 31, 2021, the Company had not provided for federal income tax on $7.5 million of accumulated undistributed earnings of its foreign subsidiaries. In the event the Company were to repatriate the foreign earnings, the Company does not estimate the repatriation being subject to taxation. The Company follows the provisions of ASC 740-10, Accounting for Uncertainty in Income Taxes, which specifies how tax benefits for uncertain tax positions are to be recognized, measured, and recorded in financial statements; requires certain disclosures of uncertain tax matters; specifies how reserves for uncertain tax positions should be classified on the balance sheet; and provides transition and interim period guidance, among other provisions. At December 31, 2021 and 2020, the Company has not recorded any liability for uncertain tax positions which relate primarily to certain federal and state research tax credits. The Company presents the uncertain tax positions as a reduction to the gross deferred tax assets with respect to research credits. The Company’s policy is to recognize interest and penalties accrued on any uncertain tax positions as a component of income tax expense, if any, in its consolidated statements of operations. For the years ended December 31, 2021 and 2020, no estimated interest or penalties were recognized on uncertain tax positions. The Company does not expect that the amounts of uncertain tax positions will change significantly within the next twelve months. A reconciliation of the beginning and ending amount of uncertain tax positions is as follows (in thousands): Year Ended December 31, 2021 2020 Unrecognized tax benefits at the beginning of year $ (281) $ — Increase for current year positions (71) (82) Increase for prior year positions — (199) Expiration of statute of limitations — — Unrecognized tax benefits at the end of year (352) (281) Gross research credit tax assets 1,930 1,579 Net research credit tax assets $ 1,578 $ 1,298 |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Earnings Per Share [Abstract] | ||
Earnings (Loss) Per Share | 18. Earnings (Loss) per Share The weighted-average common shares outstanding and thus the net loss per share calculations and potentially dilutive security amounts for all periods prior to the Business Combination have been retrospectively adjusted to the equivalent number of shares outstanding immediately after the Business Combination to effect the reverse recapitalization. Historically reported weighted average shares outstanding have been multiplied by the exchange ratio of approximately 2.59. See Note 3 for further information. Basic and diluted loss per share attributable to common stockholders was calculated as follows: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net loss $ (12,513) $ (24,739) $ (18,216) $ (43,325) Accretion of redeemable convertible preferred stock to redemption value — (82,365) (37,934) (116,126) Accretion of noncontrolling interest put option to redemption value (85) (96) (173) (190) Net loss attributable to common stockholders $ (12,598) $ (107,200) $ (56,323) $ (159,641) Denominator: Weighted average common shares outstanding, basic and diluted 72,423,043 5,589,728 67,609,838 5,592,911 Net loss per share, basic and diluted $ (0.17) $ (19.18) $ (0.83) $ (28.54) 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 June 30, 2022 and 2021 from the computation of diluted net loss per share attributable to common stockholders because including them would have had an anti-dilutive effect. June 30, 2022 2021 Convertible preferred stock — 48,566,655 Warrants on convertible preferred stock — 1,836,429 Options and RSUs to acquire common stock 20,000,493 13,624,593 Warrants on common stock 24,333,365 1,353,062 Earnout shares — — Total 44,333,858 65,380,739 Total potentially dilutive common share equivalents for the three and six months ended June 30, 2022, excludes 23,482,845 shares related to the earnout liability as these shares are contingently issuable upon meeting certain triggering events. | |
Earnings (Loss) per Share | 18. Earnings (Loss) per Share The weighted-average common shares outstanding and thus the net loss per share calculations and potentially dilutive security amounts for all periods prior to the Business Combination have been retrospectively adjusted to the equivalent number of shares outstanding immediately after the Business Combination to effect the reverse recapitalization. Historically reported weighted average shares outstanding have been multiplied by the exchange ratio of approximately 2.59. See Note 3 for further information. Basic and diluted loss per share attributable to common stockholders was calculated as follows: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net loss $ (12,513) $ (24,739) $ (18,216) $ (43,325) Accretion of redeemable convertible preferred stock to redemption value — (82,365) (37,934) (116,126) Accretion of noncontrolling interest put option to redemption value (85) (96) (173) (190) Net loss attributable to common stockholders $ (12,598) $ (107,200) $ (56,323) $ (159,641) Denominator: Weighted average common shares outstanding, basic and diluted 72,423,043 5,589,728 67,609,838 5,592,911 Net loss per share, basic and diluted $ (0.17) $ (19.18) $ (0.83) $ (28.54) 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 June 30, 2022 and 2021 from the computation of diluted net loss per share attributable to common stockholders because including them would have had an anti-dilutive effect. June 30, 2022 2021 Convertible preferred stock — 48,566,655 Warrants on convertible preferred stock — 1,836,429 Options and RSUs to acquire common stock 20,000,493 13,624,593 Warrants on common stock 24,333,365 1,353,062 Earnout shares — — Total 44,333,858 65,380,739 Total potentially dilutive common share equivalents for the three and six months ended June 30, 2022, excludes 23,482,845 shares related to the earnout liability as these shares are contingently issuable upon meeting certain triggering events. | |
Gelesis | ||
Earnings Per Share [Abstract] | ||
Earnings (Loss) Per Share | 18. Earnings (Loss) per Share Basic and diluted loss per share attributable to common stockholders were calculated as follows: December 31, 2021 2020 Numerator: Net loss $ (93,347) $ (25,905) Accretion of redeemable convertible preferred stock to redemption value (94,134) (11,372) Accretion of noncontrolling interest put option to redemption value (376) (567) Net loss attributable to common stockholders $ (187,857) $ (37,844) Denominator: Weighted average common shares outstanding, basic and diluted 2,204,486 2,149,182 Net loss per share, basic and diluted $ (85.22) $ (17.61) The Company’s potential dilutive securities, which include stock options, redeemable convertible preferred stock and warrants 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 December 31, 2021 and 2020 from the computation of diluted net loss per share attributable to common stockholders because including them would have had an anti-dilutive effect. December 31, 2021 2020 Convertible preferred stock 18,736,936 18,446,525 Warrants on convertible preferred stock 708,493 1,021,466 Options and RSUs to acquire common stock 5,203,174 5,074,547 Warrants on common stock 522,009 522,009 Total 25,170,612 25,064,547 | |
Earnings (Loss) per Share | 18. Earnings (Loss) per Share Basic and diluted loss per share attributable to common stockholders were calculated as follows: December 31, 2021 2020 Numerator: Net loss $ (93,347) $ (25,905) Accretion of redeemable convertible preferred stock to redemption value (94,134) (11,372) Accretion of noncontrolling interest put option to redemption value (376) (567) Net loss attributable to common stockholders $ (187,857) $ (37,844) Denominator: Weighted average common shares outstanding, basic and diluted 2,204,486 2,149,182 Net loss per share, basic and diluted $ (85.22) $ (17.61) The Company’s potential dilutive securities, which include stock options, redeemable convertible preferred stock and warrants 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 December 31, 2021 and 2020 from the computation of diluted net loss per share attributable to common stockholders because including them would have had an anti-dilutive effect. December 31, 2021 2020 Convertible preferred stock 18,736,936 18,446,525 Warrants on convertible preferred stock 708,493 1,021,466 Options and RSUs to acquire common stock 5,203,174 5,074,547 Warrants on common stock 522,009 522,009 Total 25,170,612 25,064,547 |
Commitment and Contingencies
Commitment and Contingencies | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | ||
Commitments and Contingencies | 19. 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. At June 30, 2022, the Company’s operating lease right of use assets was $1.7 million, of which $0.5 Future maturities of the lease liability under the Company’s noncancelable operating leases at June 30, 2022 are as follows (in thousands): At June 30, 2022 Remaining 2022 maturities $ 313 2023 629 2024 553 2025 383 2026 30 More than 5 years 15 Total undiscounted lease maturities $ 1,923 Imputed interest (151) Total lease liability $ 1,772 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 $18.3 million at June 30, 2022) 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 June 30, 2022, 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. Research and Development Tax Credits The Company’s subsidiary, Gelesis S.r.l., which conducts core manufacturing and research and development activities on behalf of the Company, is eligible to receive a non-income based and non-refundable tax credits for qualified research and development activities. The Company has earned research and development tax credits in Italy for qualifying expenses incurred by performing certain research and development activities. In December 2018, the Italian government passed a new budget law, effective January 1, 2019, that amended the eligibility criteria for recognizing qualifying research and development tax credits (“2019 Budget Law”). The 2019 Budget Law requires retroactive application for research and development tax credits earned during the year ended December 31, 2019. Under the 2019 Budget Law, research and development tax credits claimed in prior periods under previous interpretations of the research and development tax credit law may potentially be repaid by the Company. The Company evaluated the potential loss under ASC 450, Contingencies The Company has recorded $2.8 million and $3.0 million as a component of other long-term liabilities in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively. In October 2021, the Italian federal tax authority initiated an audit of the research and development tax credits for the calendar years 2017 through 2019. The Company expects that this tax audit will continue through 2022. Litigation In connection with the Business Combination, the Company received a litigation demand letter from certain purported stockholders alleging that the Company was required to provide holders of Class A Common Stock a separate class vote in connection with proposed amendments of the Company’s Amended and Restated Certificate of Incorporation to increase the number of authorized shares, such that separate votes can be cast on the proposed increase in the number of shares of Class A common stock and the proposed increase in the number of shares of preferred stock. During the six months ended June 30, 2022, the Company reached an agreement to resolve the claim and settled for an immaterial cash payment. | NOTE 6. COMMITMENTS Registration Rights Pursuant to a registration rights agreement entered into on July 1, 2020, the holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants or warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares) are entitled to registration rights requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to Class A common stock). The holders of the majority of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the expenses incurred in connection with the filing of any such registration statements. On the Closing Date, Gelesis Holdings, the Sponsor, certain former directors of CPSR (the “Director Holders”) and certain former stockholders of Legacy Gelesis (the “Legacy Gelesis Holders” and, collectively with Sponsor and the Director Holders, the “Holders”) entered into an Amended and Restated Registration and Stockholder Rights Agreement (the “Registration Rights Agreement”), pursuant to which, among other things, the Holders agreed not to effect any sale or distribution of any equity securities of Gelesis Holdings held by any of them during the lock-up period described in the B. Riley Registration Rights Agreement and Gelesis Holdings agreed to register for resale, pursuant to Rule 415 of the Securities Act, certain shares of Common Stock and other equity securities of Gelesis Holdings that are held by the parties thereto from time to time. Underwriting Agreement The underwriters are entitled to a deferred fee of $0.35 per Unit, or $9,660,000 in the aggregate. The deferred fee was paid by the Company at the Business Combination Closing. |
Related Party Transactions_2
Related Party Transactions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Related Party Transactions [Abstract] | ||
Related Party Transactions | 20. 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 19). With respect to the sublease, the Company incurred lease expense of $0.1 million and $0.1 million during the three months ended June 30, 2022 and 2021, respectively, and $0.3 million and $0.2 million during the six months ended June 30, 2022 and 2021, respectively, recorded in general and administrative expenses in the accompanying condensed consolidated statements of operations. The Company incurred royalty expense of $0.2 million and less than $0.1 million during the three months ended June 30, 2022 and 2021, respectively, and $0.3 million and $0.1 million in connection with the PureTech royalty agreement (see Note 19) during the six months ended June 30, 2022 and 2021, 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 $0.1 million and $0.1 million at June 30, 2022 and December 31, 2021, respectively, in the accompanying condensed consolidated balance sheets. On December 13, 2021, the Company issued a convertible promissory note to PureTech in the principal amount of $15.0 million (see Note 12). At December 31, 2021, the outstanding balance was $15.1 million, recorded at fair value in the accompanying condensed consolidated balance sheets. On January 19, 2022 the Company settled the convertible promissory notes in cash for principal plus accrued interest in the aggregate amount of $15.2 million. During the six months ended June 30, 2022, the Company recognized a loss of $0.1 million with respect to the change in fair value of the convertible promissory notes on the accompanying condensed consolidated statements of operations. SSD2 On December 13, 2021, the Company issued a convertible promissory note to SSD2, LLC in the principal amount of $12.0 million (see Note 12). At December 31, 2021, the outstanding balance was $12.1 million, recorded at fair value in the accompanying condensed consolidated balance sheets. On January 19, 2022 the Company settled the convertible promissory notes in cash for principal plus accrued interest in the aggregate amount of $12.1 million. During the six months ended June 30, 2022, the Company recognized a loss of less than $0.1 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 the three months ended June 30, 2022 and 2021, respectively, and $0.1 million during the six months ended June 30, 2022 and 2021, 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 June 30, 2022 and December 31, 2021, respectively, in the accompanying condensed consolidated balance sheets. Acquisition of One In connection with the amended and restated master agreement with One (see Note 11), the Company acquired a 10.0% equity interest in One in exchange for cash consideration. During the six months ended June 30, 2022 the Company made a payment of $2.9 million to One shareholders with respect to the acquisition. The Company had remaining undiscounted payments of €2.5 million and €5.0 million due to One at June 30, 2022 and December 31, 2021, respectively (approximately $2.6 million and $5.7 million due to One at June 30, 2022 and December 31, 2021, respectively). The balance at June 30, 2022 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 $0.2 million and $0.1 million with One (see Note 19) during the three months ended June 30, 2022 and 2021, respectively, and $0.3 million and $0.1 million during the six months ended June 30, 2022 and 2021, respectively, recorded in cost of goods sold in the accompanying condensed consolidated statements of operations. The Company had an accounts payable balance to One S.r.l. of $0.1 million and an accrued expense balance of $0.2 million at June 30, 2022 and an accrued expense balance of less than $0.1 million at December 31, 2021, 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 June 30, 2022 (see Note 11). In addition, the shareholders of RIF provided the Company with a loan for $18.4 million with a fixed interest rate of 6.35% per annum (see Note 12). | NOTE 5. RELATED PARTY TRANSACTIONS Founder Shares On February 26, 2020, the Sponsor purchased 5,750,000 shares of the Company’s Class B common stock (the “Founder Shares”) for an aggregate price of $25,000. On July 1, 2020, the Company effected a stock dividend of 1,150,000 shares, resulting in the Company’s initial stockholders holding an aggregate of 6,900,000 Founder Shares. The Founder Shares included an aggregate of up to 900,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. All share and per-share amounts have been retroactively restated to reflect the stock dividend. As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) subsequent to a Business Combination, (x) if the last sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Administrative Support Agreement The Company entered into an agreement, commencing on July 1, 2020 through the earlier of the Company’s consummation of a Business Combination and its liquidation, to pay an affiliate of the Sponsor a total of $10,000 per month for office space, utilities and secretarial and administrative support. For the year ended December 31, 2021, the Company incurred $120,000 in fees for these services. For the period from February 14, 2020 (inception) through December 31, 2020, the Company incurred and paid $60,000 in fees for these services. At December 31, 2021, the Company had $20,000 of such fees included in account payable and accrued expense in the consolidated balance sheets. Promissory Note — Related Party On February 14, 2020, the Sponsor agreed to loan the Company an aggregate of up to $250,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Promissory Note”). The Promissory Note was non-interest bearing and payable on the earlier of July 31, 2020 or the completion of the Initial Public Offering. The outstanding balance under the Promissory Note of $140,000 was repaid at the closing of the Initial Public Offering on July 7, 2020. Borrowings under the Promissory Note are no longer available. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor, or the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On March 3, 2021, the Sponsor committed to provide the Company an aggregate of $1,500,000 in loans for working capital purposes on an as needed basis. Such loans will be evidenced by a promissory note when issued. As of December 31, 2021 and 2020, there were no amounts outstanding under the Working Capital Loans. Sponsor Loan On July 28, 2021, the Sponsor committed to provide the Company an aggregate of $4,000,000 in loans for working capital purposes. These loans will be non-interest bearing, unsecured and will be repaid upon the consummation of a Business Combination. If the Company does not consummate a Business Combination, all amounts loaned to the Company in connection with these loans will be forgiven except to the extent that the Company has funds available to it outside of its Trust Account. As of December 31, 2021, there were no amounts outstanding under these loans. |
Subsequent Event(s)
Subsequent Event(s) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Subsequent Events [Abstract] | ||
Subsequent Event(s) | 21. Subsequent Events The Company has evaluated subsequent events which may require adjustment to or disclosure in the condensed consolidated financial statements through the date of issuance of these condensed consolidated financial statements. Promissory Notes and Promissory Note Warrants On July 25, 2022 and August 4, 2022, the Company issued three term promissory notes in the aggregate principal amount of $25.0 million to existing investor CMS Bridging DMCC, an affiliate of CMS Medical Venture Investment (HK) Limited, and existing investors and related parties PureTech Health LLC and SSD2 LLC, for an aggregate cash purchase price of $25.0 million. Each of the promissory notes is unsecured and bears interest at a rate of 15% per annum or b business days CMS License Agreement Amendment and CMS Warrant On August 4, 2022, the Company entered into an amendment to the License, Collaboration and Supply Agreement, dated June 18, 2020, by and between the Company and CMS Bridging DMCC, an affiliate of CMS Medical Venture Investment (HK) Limited. Pursuant to the amendment, the one-time, non-refundable, and non-creditable regulatory approval milestone payment of $5.0 million provided for in the original agreement became immediately payable. In addition, the amendment expands the CMS Territory and provides that the minimum annual royalty term for CMS territory will commence January 2024 (rather than January 2022, as previously provided under the original agreement) and extend through the expiration date of the amended agreement. Upon execution of the amendment, the Company also issued to CMS a warrant to purchase up to 400,000 shares of common stock, par value $0.0001 per share, at an exercise price of $0.01 per share. The warrant expires on the date that is ten years from the date of issuance and is exercisable at any time from the date of issuance until the expiration date . One S.r.l. Amended Warrant Purchase Agreement On August 9, 2022, the Company entered into an amendment to the Warrant Purchase Agreement dated October 21, 2020, by and between the Company and the One S.r.l. warrantholders. Pursuant to the amendment, the Company deferred payment of the aggregate remaining purchase price under the patent license and assignment agreement and master agreement between the Company and One S.r.l., totaling Pursuant to the amendment, and in consideration for the deferral, the Company amended the exercise price of the One S.r.l. warrantholders’ 1,353,062 previously issued common stock warrants from $4.26 to $1.45. Committed Equity Facility with B. Riley Principal Capital II, LLC On August 11, 2022, the Company entered into a Common Stock Purchase Agreement and a Registration Rights Agreement with B. Riley Principal Capital II, LLC (“B. Riley”). Pursuant to the agreement, the Company will have the right, but not the obligation, to sell to B. Riley up to the lesser of (i) $50,000,000 of newly issued shares of common stock, and (ii) 14,506,475 shares of common stock (which is the number of shares equal to approximately 19.99% of the aggregate number of shares of the Company's common stock issued and outstanding immediately prior to the execution of the agreement), from time to time during the 24-month term set forth in the agreement. | NOTE 11. SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the consolidated financial statements were issued. Based upon this review, other than the below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the consolidated financial statements. On January 13, 2022 the Company completed its Business Combination with Legacy Gelesis. |
Employee Benefit Plan
Employee Benefit Plan - Gelesis | 12 Months Ended |
Dec. 31, 2021 | |
Compensation And Retirement Disclosure [Abstract] | |
Employee Benefit Plan | 21. Employee Benefit Plan The Company has a 401(k) retirement plan in which substantially all U.S. employees are eligible to participate. Eligible employees may elect to contribute up to the maximum limits, as set by the Internal Revenue Service, of their eligible compensation. The Company made discretionary plan contributions of $0.2 million and $0.2 million during the years ended December 31, 2021 and 2020, respectively. |
Employee Benefit Plan | 21. Employee Benefit Plan The Company has a 401(k) retirement plan in which substantially all U.S. employees are eligible to participate. Eligible employees may elect to contribute up to the maximum limits, as set by the Internal Revenue Service, of their eligible compensation. The Company made discretionary plan contributions of $0.2 million and $0.2 million during the years ended December 31, 2021 and 2020, respectively. |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies (Policies) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | ||
Basis of Presentation | Basis of Presentation The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). The Company consolidates those entities where it has a direct and indirect controlling financial interest based on either a variable interest model or voting interest model. 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. The noncontrolling interest attributable to the Company’s VIE is presented as a separate component from stockholders’ equity (deficit) in the condensed consolidated balance sheets and as a noncontrolling interest in the condensed consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholders’ equity. All intercompany balances and transactions have been eliminated in consolidation. Under the variable interest model, a controlling financial interest is determined based on which entity, if any, has (i) the power to direct the activities of the VIE that most significantly impacts the VIE’s economic performance and (ii) the obligations to absorb losses that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. The consolidation status of a VIE may change as a result of such reassessments. Changes in consolidation status are applied prospectively in accordance with U.S. GAAP. | Basis of Presentation The accompanying consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). |
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. | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. One of the more significant accounting estimates included in these consolidated financial statements is the determination of the fair value of the warrant liabilities. Such estimates may be subject to change as more current information becomes available and, accordingly, the actual results could differ significantly 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. | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The guidance in FASB ASC 820, Fair Value Measurements and Disclosures 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, and call option liability 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: 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: One S.r.l. Call Option: | |
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 Effective January 1, 2020, the Company accounts for all stock-based compensation awards granted to employees and non-employees in accordance with ASC 718, Compensation – Stock Compensation ● 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. Since the adoption of ASU 2018-07 on January 1, 2020, 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. |
Business Combination and Reve_2
Business Combination and Reverse Recapitalization (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Business Combination and Reverse Recapitalization [Abstract] | |
Summary of Net Proceeds from Business Combination | The following table summarizes the net proceeds from the Business Combination, as reconciled to the accompanying condensed consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholder’s equity (deficit) and the condensed consolidated statements of cash flows: Amount Cash - CPSR trust and cash (net of redemptions) $ 7,558 Cash - PIPE Investment 90,000 Cash - Backstop Agreement 7,442 Gross proceeds $ 105,000 Less: transaction costs, advisory fees and liabilities paid (34,522) Net proceeds from the Business Combination $ 70,478 |
Schedule of Number of Shares of Common Stock Issued and Outstanding Immediately Consummation of Business Combination | The number of shares of common stock issued and outstanding immediately following the consummation of the Business Combination was as follows: Common Stock CPSR Public Stockholders 755,223 CPSR Sponsor Stockholders 4,916,250 Total CPSR Stockholders 5,671,473 Common stock issued to Gelesis Legacy Equityholders 54,814,847 Common stock issued to PIPE Investors and Backstop Agreement 11,727,967 Total common stock immediately after Closing 72,214,287 |
Fair Value Measurements (Tabl_2
Fair Value Measurements (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | ||
Schedule of Liabilities Measured at Fair Value on Recurring Basis | Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at June 30, 2022 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Earnout liability (See Note 14) $ 6,190 $ — $ — $ 6,190 Private placement warrant liability (see Note 13) 1,130 — — 1,130 One S.r.l. call option (see Note 11) 3,062 — — 3,062 Total liabilities measured at fair value $ 10,382 $ — $ — $ 10,382 Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at December 31, 2021 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Convertible promissory notes (see Note 12) $ 27,128 $ — $ — $ 27,128 Legacy Gelesis preferred stock warrants (See Note 13) 15,821 — — 15,821 One S.r.l. call option (see Note 11) 2,416 — — 2,416 Total liabilities measured at fair value $ 45,365 $ — $ — $ 45,365 | December 31, 2021 December 31, 2020 Risk free rate 1.26 % 0.47 % Expected term 5.04 5.76 Dividend yield 0.00 % 0.00 % Expected volatility 24.28 % 19.0 % Exercise price $ 11.50 $ 11.50 Unit Price $ 9.96 $ 10.15 |
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 six months ended June 30, 2022: Legacy Gelesis Redeemable Preferred Convertible Stock Promissory Warrants One S.r.l. Call Earnout Private Placement Notes Liabilities Option Liability Warrant Liability Balance at December 31, 2021 $ 27,128 $ 15,821 $ 2,416 $ — $ — Assumed upon Business Combination — — — — 8,140 Recognized upon Business Combination — — — 58,871 — Changes in fair value 156 926 865 (52,681) (7,010) Foreign currency translation (gain)/loss — — (219) — — Conversion and exchange upon Business Combination — (16,747) — — — Settlement (27,284) — — — — Balance at June 30, 2022 $ — $ — $ 3,062 $ 6,190 $ 1,130 | Warrant Private Placement Public Liabilities Fair value as of January 1, 2020 $ $ $ Initial measurement on July 7, 2020 (Initial Public Offering) 6,241,600 11,454,000 17,695,600 Transfer to Level 1 — (11,046,900) (11,046,900) Change in fair value 4,402,208 (407,100) 3,995,108 Fair value as of December 31, 2020 $ 10,643,808 $ — $ 10,643,808 Change in fair value 3,161,633 — 3,161,633 Fair value as of December 31, 2021 $ 13,805,441 — $ 13,805,441 |
Product Revenue and Reserve a_2
Product Revenue and Reserve and Allowances (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Revenue From Contract With Customer [Abstract] | |
Summary of Revenue | Revenue for the three and six months ended June 30, 2022 and 2021 consisted of the following (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Roman Health Pharmacy LLC $ 6,916 $ 2,037 $ 13,415 $ 4,931 GoGoMeds 2,057 140 3,072 230 CMS — — — 119 Total $ 8,973 $ 2,178 $ 16,487 $ 5,279 |
Summary of Activity in Product Revenue Reserve and Allowance | The following table summarizes the activity in the product revenue reserve and allowance during the six months ended June 30, 2022 and 2021 (in thousands): 2022 2021 Balance at December 31, $ 82 $ 14 Provision related to product sales 1,193 326 Credits and payments made (1,154) (324) Balance at June 30, $ 121 $ 16 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | ||
Schedule of Inventories | Inventories consisted of the following (in thousands): June 30, December 31, 2022 2021 Raw materials $ 9,599 $ 8,074 Work in process 4,746 2,643 Finished goods 4,476 2,786 Total inventories $ 18,821 $ 13,503 | |
Schedule of inventories | Inventories consisted of the following (in thousands): June 30, December 31, 2022 2021 Raw materials $ 9,599 $ 8,074 Work in process 4,746 2,643 Finished goods 4,476 2,786 Total inventories $ 18,821 $ 13,503 | |
Gelesis | ||
Inventory Disclosure [Abstract] | ||
Schedule of Inventories | At December 31, 2021 2020 Raw materials $ 8,074 $ 1,213 Work in process 2,643 913 Finished goods 2,786 2,433 Consignment inventories — 563 Total inventories $ 13,503 $ 5,122 | |
Schedule of inventories | At December 31, 2021 2020 Raw materials $ 8,074 $ 1,213 Work in process 2,643 913 Finished goods 2,786 2,433 Consignment inventories — 563 Total inventories $ 13,503 $ 5,122 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | ||
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following (in thousands): June 30, December 31, 2022 2021 Prepaid expenses $ 1,128 $ 982 Prepaid insurance 1,474 55 Prepaid manufacturing expenses 596 2,624 Prepaid contract research costs 185 262 Research and development tax credit 692 579 Value added tax receivable 1,574 5,633 Deferred financing costs — 3,855 Income tax receivable 198 213 Investment tax credit 906 — Prepaid expenses and other current assets $ 6,753 $ 14,203 | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following (in thousands): June 30, December 31, 2022 2021 Prepaid expenses $ 1,128 $ 982 Prepaid insurance 1,474 55 Prepaid manufacturing expenses 596 2,624 Prepaid contract research costs 185 262 Research and development tax credit 692 579 Value added tax receivable 1,574 5,633 Deferred financing costs — 3,855 Income tax receivable 198 213 Investment tax credit 906 — Prepaid expenses and other current assets $ 6,753 $ 14,203 | |
Gelesis | ||
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | ||
Schedule of Prepaid Expenses and Other Current Assets | At December 31, 2021 2020 Prepaid expenses $ 3,874 $ 1,024 Prepaid contract research costs 262 169 Research and development tax credit 579 1,131 Value added tax receivable 5,633 4,315 Deferred financing costs 3,855 38 Prepaid expenses and other current assets $ 14,203 $ 6,677 | |
Schedule of Prepaid Expenses and Other Current Assets | At December 31, 2021 2020 Prepaid expenses $ 3,874 $ 1,024 Prepaid contract research costs 262 169 Research and development tax credit 579 1,131 Value added tax receivable 5,633 4,315 Deferred financing costs 3,855 38 Prepaid expenses and other current assets $ 14,203 $ 6,677 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Property Plant And Equipment [Abstract] | ||
Schedule of Property and Equipment, Net | Property and equipment, net, consisted of the following (in thousands): June 30, December 31, 2022 2021 Laboratory and manufacturing equipment $ 28,158 $ 28,101 Land and buildings 10,186 10,404 Leasehold improvements 1,490 1,614 Computer equipment and software 529 463 Capitalized software 232 228 Construction in process 21,683 22,097 Property and equipment – at cost 62,278 62,907 Less accumulated depreciation (5,973) (4,392) Property and equipment – net $ 56,305 $ 58,515 | |
Schedule of property and equipment, net | Property and equipment, net, consisted of the following (in thousands): June 30, December 31, 2022 2021 Laboratory and manufacturing equipment $ 28,158 $ 28,101 Land and buildings 10,186 10,404 Leasehold improvements 1,490 1,614 Computer equipment and software 529 463 Capitalized software 232 228 Construction in process 21,683 22,097 Property and equipment – at cost 62,278 62,907 Less accumulated depreciation (5,973) (4,392) Property and equipment – net $ 56,305 $ 58,515 | |
Gelesis | ||
Property Plant And Equipment [Abstract] | ||
Schedule of Property and Equipment, Net | At December 31, 2021 2020 Laboratory and manufacturing equipment $ 28,101 $ 8,176 Land and buildings 10,404 4,334 Leasehold improvements 1,614 1,742 Computer equipment and software 463 176 Capitalized software 228 17 Construction in process 22,097 35,551 Property and equipment – at cost 62,907 49,996 Less accumulated depreciation (4,392) (3,101) Property and equipment – net $ 58,515 $ 46,895 | |
Schedule of property and equipment, net | At December 31, 2021 2020 Laboratory and manufacturing equipment $ 28,101 $ 8,176 Land and buildings 10,404 4,334 Leasehold improvements 1,614 1,742 Computer equipment and software 463 176 Capitalized software 228 17 Construction in process 22,097 35,551 Property and equipment – at cost 62,907 49,996 Less accumulated depreciation (4,392) (3,101) Property and equipment – net $ 58,515 $ 46,895 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Payables And Accruals [Abstract] | ||
Schedule of Accrued Expenses | Accrued expenses and other current liabilities consisted of the following (in thousands): June 30, December 31, 2022 2021 Accrued payroll and related benefits $ 2,442 $ 1,384 Accrued professional fees and outside contractors (including due to related party of 2,392 4,359 Accrued property, plant and equipment additions 589 1,257 Accrued inventory and manufacturing expense 285 128 Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) 2,612 5,604 Tax payables 70 145 Deferred legal fees 738 738 Accrued interest 587 45 Total accrued expenses $ 9,715 $ 13,660 | At December 31, 2021 2020 Accrued payroll and related benefits $ 1,384 $ 3,009 Accrued professional fees and outside contractors (including due to related party of $60 and $109, respectively) 4,359 3,494 Accrued property, plant and equipment additions 1,257 768 Accrued inventory and manufacturing expense 128 — Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) 5,604 — Income taxes payable 145 — Deferred IPO Fees 738 — Accrued interest 45 49 Total accrued expenses $ 13,660 $ 7,320 |
Other Long-Term Liabilities (Ta
Other Long-Term Liabilities (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | ||
Other Long-Term Liabilities | Other long-term liabilities consisted of the following (in thousands): June, December 31, 2022 2021 Long-term tax liabilities 91 182 Contingent loss for research and development tax credits 2,755 2,990 One S.r.l. call option (see Note 11) 3,062 2,416 Total other long-term liabilities $ 5,908 $ 5,588 | |
Other Long-Term Liabilities | Other long-term liabilities consisted of the following (in thousands): June, December 31, 2022 2021 Long-term tax liabilities 91 182 Contingent loss for research and development tax credits 2,755 2,990 One S.r.l. call option (see Note 11) 3,062 2,416 Total other long-term liabilities $ 5,908 $ 5,588 | |
Gelesis | ||
Other Liabilities Disclosure [Abstract] | ||
Other Long-Term Liabilities | At December 31, 2021 2020 Deferred IPO fees $ — $ 738 Long-term tax liabilities 182 301 Contingent loss for research and development tax credits 2,990 3,233 Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) — 5,912 One Srl call option (see Note 11) 2,416 1,545 Total other long-term liabilities $ 5,588 $ 11,729 | |
Other Long-Term Liabilities | At December 31, 2021 2020 Deferred IPO fees $ — $ 738 Long-term tax liabilities 182 301 Contingent loss for research and development tax credits 2,990 3,233 Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) — 5,912 One Srl call option (see Note 11) 2,416 1,545 Total other long-term liabilities $ 5,588 $ 11,729 |
Significant Agreements (Tables)
Significant Agreements (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Significant Agreements [Abstract] | ||
Schedule of finite lived intangible assets amortization expense | A summary of the intangible asset activity that resulted from this transaction during the six months ended June 30, 2022 is as follows (in thousands): Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Cumulative amortization expense (5,667) Balance at December 31, 2021 $ 15,680 Period amortization expense (1,133) Balance at June 30, 2022 $ 14,547 | |
Schedule of finite lived intangible assets amortization expense | A summary of the intangible asset activity that resulted from this transaction during the six months ended June 30, 2022 is as follows (in thousands): Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Cumulative amortization expense (5,667) Balance at December 31, 2021 $ 15,680 Period amortization expense (1,133) Balance at June 30, 2022 $ 14,547 | |
Summary of Changes in Fair Value of Call Option Liability | The following represents a summary of the changes to Company’s One S.r.l. call option liability during the six months ended June 30, 2022 (in thousands): Balance at December 31, 2021 $ 2,416 Change in fair value 865 Foreign currency translation gain (219) Balance at June 30, 2022 $ 3,062 | |
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 S.r.l. call option liability at June 30, 2022 and December 31, 2021: June 30, December 31, 2022 2021 Expected term 4.0 years 2.0 years Expected volatility 64.0 % 62.0 % Expected dividend yield 0.0 % 0.0 % Risk free interest rate 3.0 % 0.70 % Estimated fair value of ownership interest $ 6,097 $ 6,922 Exercise price of call option $ 6,270 $ 6,806 | |
Gelesis | ||
Significant Agreements [Abstract] | ||
Schedule of finite lived intangible assets amortization expense | Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Amortization expense (1,133) Balance at December 31, 2019 $ 20,214 Amortization expense (2,267) Balance at December 31, 2020 $ 17,947 Amortization expense (2,267) Balance at December 31, 2021 $ 15,680 | |
Schedule of allocated consideration in the June 2019 transaction on relative fair value basis | Consideration Cash $ 12,668 Warrants for redeemable convertible preferred stock 4,706 Fair value of total consideration $ 17,374 Assets acquired at relative fair value Intangible asset related to reduction in royalty $ 15,564 Equity-method investment 1,810 Total assets acquired $ 17,374 | |
Schedule of finite lived intangible assets amortization expense | Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Amortization expense (1,133) Balance at December 31, 2019 $ 20,214 Amortization expense (2,267) Balance at December 31, 2020 $ 17,947 Amortization expense (2,267) Balance at December 31, 2021 $ 15,680 | |
Schedule of gains on warrant liability settlement | Carrying value of warrants for redeemable convertible preferred stock $ 5,973 Fair value of common stock warrants, net of cash consideration paid of $10 (4,312) Fair value of contingent call option granted to One shareholders (1,494) Gain on warrant liability extinguishment $ 167 |
Debt (Tables)
Debt (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Debt Disclosure [Abstract] | ||
Summary of Non-convertible Debt Outstanding | The Company’s non-convertible debt outstanding at June 30, 2022 and December 31, 2021 is summarized as follows: June 30, December 31, 2022 2021 Italian Economic Development Agency Loan 323 525 Intesa Sanpaolo Loan 1 7,384 8,507 Intesa Sanpaolo Loan 2 5,225 5,672 Horizon 2020 Loan 414 486 RIF Shareholders Loan 15,674 17,015 UniCredit Loan 5,188 5,630 Total debt obligation $ 34,208 $ 37,835 Unamortized loan discount and issuance costs (1,016) (754) Total debt obligation carrying amount $ 33,192 $ 37,081 Current portion $ 3,177 $ 1,950 Long-term portion $ 30,015 $ 35,131 | |
Summary of Future Maturities to Non-convertible Debt Outstanding | Future maturities with respect to debt outstanding at June 30, 2022 are as follows (in thousands): At June 30, 2022 Remaining 2022 obligation 1,362 2023 7,909 2024 5,315 2025 3,868 2026 3,889 More than 5 years 11,865 Total maturities $ 34,208 | |
Gelesis | ||
Schedule of principle payments in connection to debt outstanding | At December 31, 2021 2022 2,183 2023 8,585 2024 5,771 2025 4,199 2026 4,221 More than 5 years 12,877 Unamortized loan discount and issuance costs (754) Total obligation $ 37,081 |
Warrant Liabilities (Tables)
Warrant Liabilities (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
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 six months ended June 30, 2022: Series A-4 Private Placement Warrants Warrants Total Balance at December 31, 2021 $ 15,821 $ — $ 15,821 Assumed upon Business Combination — 8,140 8,140 Changes in fair value 926 (7,010) (6,084) Conversion and exchange upon Business Combination (16,747) — (16,747) Balance at June 30, 2022 $ — $ 1,130 $ 1,130 | |
Summary of Weighted Average Assumptions of Fair Value of Liabilities | Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at June 30, 2022 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Earnout liability (See Note 14) $ 6,190 $ — $ — $ 6,190 Private placement warrant liability (see Note 13) 1,130 — — 1,130 One S.r.l. call option (see Note 11) 3,062 — — 3,062 Total liabilities measured at fair value $ 10,382 $ — $ — $ 10,382 Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at December 31, 2021 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Convertible promissory notes (see Note 12) $ 27,128 $ — $ — $ 27,128 Legacy Gelesis preferred stock warrants (See Note 13) 15,821 — — 15,821 One S.r.l. call option (see Note 11) 2,416 — — 2,416 Total liabilities measured at fair value $ 45,365 $ — $ — $ 45,365 | December 31, 2021 December 31, 2020 Risk free rate 1.26 % 0.47 % Expected term 5.04 5.76 Dividend yield 0.00 % 0.00 % Expected volatility 24.28 % 19.0 % Exercise price $ 11.50 $ 11.50 Unit Price $ 9.96 $ 10.15 |
Gelesis | ||
Class Of Warrant Or Right [Line Items] | ||
Summary of Weighted Average Assumptions of Fair Value of Liabilities | Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Convertible promissory notes (see Note 12) $ 27,128 $ — $ — $ 27,128 Preferred stock warrants 15,821 — — 15,821 One Srl call option (see Note 11) 2,416 — — 2,416 Total liabilities measured at fair value $ 45,365 $ — $ — $ 45,365 | |
Schedule of warrants outstanding | Summary of Outstanding Warrants The following represents a summary of the warrants outstanding at December 31, 2021: Number of Shares Issued Classification Exercisable for Issuable August 2013 Liability Series A-4 redeemable convertible preferred stock (“Series A-4”) 708,493 October 2020 Equity Common stock 522,009 The following represents a summary of the warrants outstanding at December 31, 2020: Number of Shares Issued Classification Exercisable for Issuable April 2011 Liability Series A-1 redeemable convertible preferred stock (“Series A-1”) 74,784 June 2012 Liability Series A-3 redeemable convertible preferred stock (“Series A-3”) 238,189 August 2013 Liability Series A-4 redeemable convertible preferred stock (“Series A-4”) 708,493 October 2020 Equity Common stock 522,009 | |
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 June 30, 2022: Private Placement Warrants Expected term 4.5 years Expected volatility 62.0 % Expected dividend yield 0.0 % Risk free interest rate 3.0 % Price of Gelesis Common Stock $ 1.55 Exercise price of warrants $ 11.50 |
Earnout Liability (Tables)
Earnout Liability (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Derivative Instrument Detail [Abstract] | |
Summary of Earnout Liability Activity | The following represents a summary of the earnout liability activity during the six months ended June 30, 2022: Earnout Liability Balance at December 31, 2021 $ — Recognized upon Business Combination 58,871 Changes in fair value (52,681) Balance at June 30, 2022 $ 6,190 |
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 June 30, 2022: Earnout Liability Expected term 4.5 years Expected volatility 62.0 % Expected dividend yield 0.0 % Risk free interest rate 3.0 % Price of Gelesis Common Stock $ 1.55 |
Stockholder's Equity (Deficit)
Stockholder's Equity (Deficit) (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Stockholders Equity Note [Abstract] | |
Schedule of Common Stock Reserved for Future Issuance | At June 30, 2022 and December 31, 2021 common stock reserved for future issuances was as follows: June 30, December 31, 2022 2021 Common stock issued upon option exercise and RSUs vesting 20,000,493 13,486,708 Conversion of all classes of redeemable convertible preferred stock — 48,566,655 Issuances upon exercise of warrants to purchase Series A-4, upon conversion to common warrants — 1,836,429 Issuances upon exercise of common stock warrants 24,333,365 1,353,062 Earnout shares 23,482,845 — Total common stock reserved for future issuance 67,816,703 65,242,854 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Summary of Stock Option Activity | The following table summarizes the Company’s stock option activity during the six months ended June 30, 2022: Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price per Contractual Intrinsic Value Options Share Term (Years) (in thousands) Outstanding at December 31, 2021 4,889,820 $ 10.39 6.17 $ 54,449 Retroactive application of reverse recapitalization 7,784,666 (6.38) Adjusted and Outstanding at December 31, 2021 12,674,486 $ 4.01 6.17 $ 54,449 Granted 2,658,185 $ 3.35 Exercised (162,064) $ 0.68 Forfeited - unvested (17,281) $ 5.56 Forfeited - vested (63,718) $ 4.31 Expired (456,534) $ 1.23 Outstanding at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 Exercisable at June 30, 2022 9,780,237 $ 3.81 5.43 $ 840 Vested and Expected to Vest at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 | |
Schedule of stock option activity | The following table summarizes the Company’s stock option activity during the six months ended June 30, 2022: Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price per Contractual Intrinsic Value Options Share Term (Years) (in thousands) Outstanding at December 31, 2021 4,889,820 $ 10.39 6.17 $ 54,449 Retroactive application of reverse recapitalization 7,784,666 (6.38) Adjusted and Outstanding at December 31, 2021 12,674,486 $ 4.01 6.17 $ 54,449 Granted 2,658,185 $ 3.35 Exercised (162,064) $ 0.68 Forfeited - unvested (17,281) $ 5.56 Forfeited - vested (63,718) $ 4.31 Expired (456,534) $ 1.23 Outstanding at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 Exercisable at June 30, 2022 9,780,237 $ 3.81 5.43 $ 840 Vested and Expected to Vest at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 | |
Schedule of fair value assumptions | The fair value of each option issued was estimated at the date of grant using Black-Scholes with the following weighted-average assumptions: Six Month Ended June 30, 2022 Market price of common stock $ 3.35 Expected volatility 72.4 % Expected term (in years) 6.1 Risk-free interest rate 1.7 % Expected dividend yield 0.0 % | |
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): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Research and development $ 3,008 $ 494 $ 8,073 $ 1,061 Selling, general and administrative 4,968 1,145 13,892 2,033 Total $ 7,976 $ 1,639 $ 21,965 $ 3,094 | |
Schedule of Grant Date Fair Value of Options Issued Using Black-Scholes Weighted Average Assumptions | The fair value of each option issued was estimated at the date of grant using Black-Scholes with the following weighted-average assumptions: Six Month Ended June 30, 2022 Market price of common stock $ 3.35 Expected volatility 72.4 % Expected term (in years) 6.1 Risk-free interest rate 1.7 % Expected dividend yield 0.0 % | |
Summary of Restricted Stock Unit Activity | The following table summarizes the Company’s RSU activity during the six months ended June 30, 2022: Weighted- Average Grant Date Number of RSUs Fair Value Outstanding and Unvested at December 31, 2021 313,354 $ 21.41 Retroactive application of reverse recapitalization 498,868 $ (13.15) Adjusted and Outstanding and Unvested at December 31, 2021 812,222 $ 8.26 Granted 4,555,197 $ 3.46 Vested (17,654) $ 8.26 Forfeited — Outstanding and Unvested at June 30, 2022 5,349,765 $ 4.18 | |
Gelesis | ||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Summary of Stock Option Activity | Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price per Contractual Intrinsic Value Options Share Term (Years) (in thousands) Outstanding at December 31, 2020 5,034,858 $ 9.26 6.12 $ 14,742 Granted 518,684 18.52 Exercised (255,062) 0.57 5,304 Forfeited (68,090) 10.98 Expired (340,570) 1.49 Outstanding at December 31, 2021 4,889,820 $ 10.39 6.17 $ 54,449 Exercisable at December 31, 2021 3,704,417 $ 9.21 5.28 $ 45,211 Nonvested at December 31, 2021 1,185,403 $ 14.10 8.95 $ 9,238 | |
Schedule of stock option activity | Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price per Contractual Intrinsic Value Options Share Term (Years) (in thousands) Outstanding at December 31, 2020 5,034,858 $ 9.26 6.12 $ 14,742 Granted 518,684 18.52 Exercised (255,062) 0.57 5,304 Forfeited (68,090) 10.98 Expired (340,570) 1.49 Outstanding at December 31, 2021 4,889,820 $ 10.39 6.17 $ 54,449 Exercisable at December 31, 2021 3,704,417 $ 9.21 5.28 $ 45,211 Nonvested at December 31, 2021 1,185,403 $ 14.10 8.95 $ 9,238 | |
Schedule of stock-based compensation expense | Year ended December 31, 2021 2020 Research and development $ 1,565 $ 1,960 General and administrative 3,967 2,848 Total $ 5,532 $ 4,808 | |
Schedule of fair value assumptions | Year ended December 31, 2021 2020 Fair value of common stock $ 20.02 $ 11.18 Expected volatility 60.1 % 63.6 % Expected term (in years) 5.8 5.8 Risk-free interest rate 1.1 % 0.2 % Expected dividend yield 0.0 % 0.0 % | |
Schedule of Grant Date Fair Value of Options Issued Using Black-Scholes Weighted Average Assumptions | Year ended December 31, 2021 2020 Fair value of common stock $ 20.02 $ 11.18 Expected volatility 60.1 % 63.6 % Expected term (in years) 5.8 5.8 Risk-free interest rate 1.1 % 0.2 % Expected dividend yield 0.0 % 0.0 % |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
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: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net loss $ (12,513) $ (24,739) $ (18,216) $ (43,325) Accretion of redeemable convertible preferred stock to redemption value — (82,365) (37,934) (116,126) Accretion of noncontrolling interest put option to redemption value (85) (96) (173) (190) Net loss attributable to common stockholders $ (12,598) $ (107,200) $ (56,323) $ (159,641) Denominator: Weighted average common shares outstanding, basic and diluted 72,423,043 5,589,728 67,609,838 5,592,911 Net loss per share, basic and diluted $ (0.17) $ (19.18) $ (0.83) $ (28.54) | For the Period from February 14, 2020 (Inception) Through Year Ended December 31, December 31, 2021 2020 Class A Class B Class A Class B Basic and diluted net loss per common share Numerator: Allocation of net loss, as adjusted $ (10,318,466) $ (2,579,616) $ (10,719,238) $ (4,575,622) Denominator: Basic and diluted weighted average stock outstanding 27,600,000 6,900,000 15,218,692 6,496,262 Basic and diluted net loss per common share $ (0.37) $ (0.37) $ (0.70) $ (0.70) |
Schedule of Earnings Per Share, Basic and Diluted | Basic and diluted loss per share attributable to common stockholders was calculated as follows: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net loss $ (12,513) $ (24,739) $ (18,216) $ (43,325) Accretion of redeemable convertible preferred stock to redemption value — (82,365) (37,934) (116,126) Accretion of noncontrolling interest put option to redemption value (85) (96) (173) (190) Net loss attributable to common stockholders $ (12,598) $ (107,200) $ (56,323) $ (159,641) Denominator: Weighted average common shares outstanding, basic and diluted 72,423,043 5,589,728 67,609,838 5,592,911 Net loss per share, basic and diluted $ (0.17) $ (19.18) $ (0.83) $ (28.54) | For the Period from February 14, 2020 (Inception) Through Year Ended December 31, December 31, 2021 2020 Class A Class B Class A Class B Basic and diluted net loss per common share Numerator: Allocation of net loss, as adjusted $ (10,318,466) $ (2,579,616) $ (10,719,238) $ (4,575,622) Denominator: Basic and diluted weighted average stock outstanding 27,600,000 6,900,000 15,218,692 6,496,262 Basic and diluted net loss per common share $ (0.37) $ (0.37) $ (0.70) $ (0.70) |
Schedule of Anti-Dilutive shares for computation of diluted net loss per share attributable to common stockholders | June 30, 2022 2021 Convertible preferred stock — 48,566,655 Warrants on convertible preferred stock — 1,836,429 Options and RSUs to acquire common stock 20,000,493 13,624,593 Warrants on common stock 24,333,365 1,353,062 Earnout shares — — Total 44,333,858 65,380,739 | |
Schedule of Anti-dilutive Securities Excluded from Computation of Net Loss Per Share | June 30, 2022 2021 Convertible preferred stock — 48,566,655 Warrants on convertible preferred stock — 1,836,429 Options and RSUs to acquire common stock 20,000,493 13,624,593 Warrants on common stock 24,333,365 1,353,062 Earnout shares — — Total 44,333,858 65,380,739 | |
Gelesis | ||
Earnings Per Share [Abstract] | ||
Summary of Basic and Diluted Net Loss Per Share | December 31, 2021 2020 Numerator: Net loss $ (93,347) $ (25,905) Accretion of redeemable convertible preferred stock to redemption value (94,134) (11,372) Accretion of noncontrolling interest put option to redemption value (376) (567) Net loss attributable to common stockholders $ (187,857) $ (37,844) Denominator: Weighted average common shares outstanding, basic and diluted 2,204,486 2,149,182 Net loss per share, basic and diluted $ (85.22) $ (17.61) | |
Schedule of Earnings Per Share, Basic and Diluted | December 31, 2021 2020 Numerator: Net loss $ (93,347) $ (25,905) Accretion of redeemable convertible preferred stock to redemption value (94,134) (11,372) Accretion of noncontrolling interest put option to redemption value (376) (567) Net loss attributable to common stockholders $ (187,857) $ (37,844) Denominator: Weighted average common shares outstanding, basic and diluted 2,204,486 2,149,182 Net loss per share, basic and diluted $ (85.22) $ (17.61) | |
Schedule of Anti-Dilutive shares for computation of diluted net loss per share attributable to common stockholders | December 31, 2021 2020 Convertible preferred stock 18,736,936 18,446,525 Warrants on convertible preferred stock 708,493 1,021,466 Options and RSUs to acquire common stock 5,203,174 5,074,547 Warrants on common stock 522,009 522,009 Total 25,170,612 25,064,547 | |
Schedule of Anti-dilutive Securities Excluded from Computation of Net Loss Per Share | December 31, 2021 2020 Convertible preferred stock 18,736,936 18,446,525 Warrants on convertible preferred stock 708,493 1,021,466 Options and RSUs to acquire common stock 5,203,174 5,074,547 Warrants on common stock 522,009 522,009 Total 25,170,612 25,064,547 |
Commitment and Contingencies (T
Commitment and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Commitments And Contingencies Disclosure [Abstract] | |
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 June 30, 2022 are as follows (in thousands): At June 30, 2022 Remaining 2022 maturities $ 313 2023 629 2024 553 2025 383 2026 30 More than 5 years 15 Total undiscounted lease maturities $ 1,923 Imputed interest (151) Total lease liability $ 1,772 |
Nature of the Business and Basi
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 Accou_10
Summary of Significant Accounting Policies - Additional Information (Details) - One Srl | Jun. 30, 2022 | Jun. 30, 2019 |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||
Equity investment ownership percentage | 10% | 10% |
Call Option | ||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||
Equity investment ownership percentage | 10% |
Business Combination and Reve_3
Business Combination and Reverse Recapitalization - Additional Information (Details) | 6 Months Ended | 11 Months Ended | 12 Months Ended | |||
Jan. 13, 2022 USD ($) $ / shares shares | Jul. 19, 2021 $ / shares shares | Jun. 30, 2022 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Feb. 26, 2020 $ / shares | |
Business Acquisition [Line Items] | ||||||
Common stock, shares issued | shares | 72,552,477 | 6,248,192 | ||||
Common stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | ||||
Aggregate purchase price | $ 25,000 | |||||
Common stock exchange ratio | 2.59 | |||||
Number of earn-out shares contingent consideration arrangement | shares | 18,758,241 | |||||
Liability upon the closing of business combination | $ 58,900,000 | |||||
Number of remaining earn out shares | shares | 4,724,604 | |||||
Fair value of incremental compensation cost | $ 14,800,000 | |||||
Business Combination, acquisition-related costs | $ 37,200,000 | |||||
Business Combination, direct transaction costs | 34,500,000 | |||||
Public Warrants | ||||||
Business Acquisition [Line Items] | ||||||
Number of warrants outstanding | shares | 13,800,000 | 13,800,000 | 13,800,000 | |||
Carrying value of warrants transferred to additional paid in capital | $ 7,100,000 | |||||
Private Placement Warrants | ||||||
Business Acquisition [Line Items] | ||||||
Number of warrants outstanding | shares | 7,520,000 | 7,520,000 | 7,520,000 | |||
Liability held at fair value | $ 8,100,000 | |||||
Selling, General and Administrative Expense | ||||||
Business Acquisition [Line Items] | ||||||
Business Combination, acquisition-related costs | $ 2,700,000 | |||||
Research and Development Expense | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of incremental compensation cost | 4,400,000 | |||||
PIPE Investors | ||||||
Business Acquisition [Line Items] | ||||||
Aggregate purchase price | $ 90,000,000 | |||||
Backstop Agreement | ||||||
Business Acquisition [Line Items] | ||||||
Aggregate purchase price | $ 7,400,000 | |||||
Gelesis | ||||||
Business Acquisition [Line Items] | ||||||
Common stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | ||||
Number of restricted earn out shares entitled | shares | 23,482,845 | 23,483,250 | 23,482,845 | |||
Trading price for future vesting threshold of the first third | $ / shares | $ 12.50 | $ 12.50 | ||||
Trading price for future vesting threshold of the second third | $ / shares | 15 | |||||
Trading price for future vesting threshold of the third portion | $ / shares | $ 17.50 | |||||
Number of trading days within specified period that share price must exceed | 20 days | 20 days | ||||
Consecutive trading days used to evaluate share price | 30 days | 30 days | ||||
Threshold period before share price condition commences | 5 years | 5 years | ||||
Fair value of incremental compensation cost | $ 11,400,000 | |||||
Gelesis | Selling, General and Administrative Expense | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of incremental compensation cost | $ 7,000,000 | |||||
Class A common stock | ||||||
Business Acquisition [Line Items] | ||||||
Common stock, shares issued | shares | 0 | 0 | ||||
Common stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Class A common stock | Backstop Agreement | ||||||
Business Acquisition [Line Items] | ||||||
Common stock, shares issued | shares | 1,983,750 | |||||
Class A common stock | Gelesis | ||||||
Business Acquisition [Line Items] | ||||||
Common stock, par value | $ / shares | $ 0.0001 | |||||
Class A common stock | Private Placement | PIPE Investors | ||||||
Business Acquisition [Line Items] | ||||||
Common stock, shares issued | shares | 9,000,000 | |||||
Common stock, par value | $ / shares | $ 10 | |||||
Class A common stock | Private Placement | Backstop Agreement | ||||||
Business Acquisition [Line Items] | ||||||
Common stock, shares issued | shares | 744,217 | |||||
Common stock, par value | $ / shares | $ 10 | |||||
Common Stock | ||||||
Business Acquisition [Line Items] | ||||||
Common stock, shares issued | shares | 72,552,477 | |||||
Common stock, par value | $ / shares | $ 0.0001 | |||||
Common Stock | Gelesis | ||||||
Business Acquisition [Line Items] | ||||||
Common stock exchange ratio | 2.59 | |||||
Convertible preferred stock exchange ratio | 2.59 | |||||
stock options and restricted stock units conversion exchange ratio | 2.59 | |||||
Preferred stock warrants conversion exchange ratio | 2.59 | |||||
Common stock warrants conversion exchange ratio | 2.59 |
Business Combination and Reve_4
Business Combination and Reverse Recapitalization - Summary of Net Proceeds from Business Combination (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Business Acquisition [Line Items] | |
Gross Proceeds | $ 105,000 |
Less: transaction costs, advisory fees and liabilities paid | (34,522) |
Net proceeds from the Business Combination | 70,478 |
CPSR | |
Business Acquisition [Line Items] | |
Gross Proceeds | 7,558 |
PIPE Investors | |
Business Acquisition [Line Items] | |
Gross Proceeds | 90,000 |
Backstop Agreement | |
Business Acquisition [Line Items] | |
Gross Proceeds | $ 7,442 |
Business Combination and Reve_5
Business Combination and Reverse Recapitalization - Schedule of Consummation of Business Combination (Details) - shares | 6 Months Ended | ||
Jun. 30, 2022 | Jan. 13, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | |||
Total common stock immediately after Closing | 72,552,477 | 6,248,192 | |
Common Stock | |||
Business Acquisition [Line Items] | |||
CPSR stockholders | 5,671,473 | ||
Common stock issued to Gelesis Legacy Equityholders | 54,814,847 | ||
Common stock issued to PIPE investors and backstop agreement | 11,727,967 | ||
Total common stock immediately after Closing | 72,552,477 | 72,214,287 | |
Common Stock | CPSR Public Stockholders | |||
Business Acquisition [Line Items] | |||
CPSR stockholders | 755,223 | ||
Common Stock | CPSR Sponsor Stockholders | |||
Business Acquisition [Line Items] | |||
CPSR stockholders | 4,916,250 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Liabilities | |||
Private placement warrant liability (see Note 13) | $ 22,499,441 | $ 30,101,808 | |
Recurring | |||
Liabilities | |||
Convertible promissory notes (see Note 12) | 27,128,000 | ||
Legacy Gelesis preferred stock warrants (See Note 13) | 15,821,000 | ||
One Srl call option (see Note 11) | $ 3,062,000 | 2,416,000 | |
Total liabilities measured at fair value | 10,382,000 | 45,365,000 | |
Recurring | Level 3 | |||
Liabilities | |||
Convertible promissory notes (see Note 12) | 27,128,000 | ||
Legacy Gelesis preferred stock warrants (See Note 13) | 15,821,000 | ||
One Srl call option (see Note 11) | 3,062,000 | 2,416,000 | |
Total liabilities measured at fair value | 10,382,000 | $ 45,365,000 | |
Recurring | Earnout Liability | |||
Liabilities | |||
Earnout liability (See Note 14) | 6,190,000 | ||
Recurring | Earnout Liability | Level 3 | |||
Liabilities | |||
Earnout liability (See Note 14) | 6,190,000 | ||
Recurring | Private Placement Warrant Liability | |||
Liabilities | |||
Private placement warrant liability (see Note 13) | 1,130,000 | ||
Recurring | Private Placement Warrant Liability | Level 3 | |||
Liabilities | |||
Private placement warrant liability (see Note 13) | $ 1,130,000 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Changes in Fair Value of Company's Level 3 Financial Instruments (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Beginning balance | $ 15,821 |
Assumed upon Business Combination | 8,140 |
Change in fair value | (6,084) |
Conversion and exchange upon Business Combination | (16,747) |
Ending balance | 1,130 |
Convertible Promissory Notes | Level 3 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Beginning balance | 27,128 |
Change in fair value | 156 |
Settlement | (27,284) |
Ending balance | |
Legacy Gelesis Preferred Stock Warrants | Level 3 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Beginning balance | 15,821 |
Change in fair value | 926 |
Conversion and exchange upon Business Combination | (16,747) |
Ending balance | |
One S.r.l. Call Option | Level 3 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Beginning balance | 2,416 |
Change in fair value | 865 |
Foreign currency translation (gain)/loss | (219) |
Ending balance | 3,062 |
Earnout Liability | Level 3 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Recognized upon Business Combination | 58,871 |
Change in fair value | (52,681) |
Ending balance | 6,190 |
Private Placement Warrant Liability | Level 3 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Assumed upon Business Combination | 8,140 |
Change in fair value | (7,010) |
Ending balance | $ 1,130 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) | 6 Months Ended |
Jun. 30, 2021 USD ($) | |
Fair Value, Transfers Between Level 1 and Level 2, Description and Policy [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 and Reserve a_3
Product Revenue and Reserve and Allowances - Summary of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Product Information [Line Items] | ||||
Revenue | $ 8,973 | $ 2,178 | $ 16,487 | $ 5,279 |
Product Revenue, Net | ||||
Product Information [Line Items] | ||||
Revenue | 8,973 | 2,178 | 16,487 | 5,279 |
Product Revenue, Net | Roman Health Pharmacy LLC | ||||
Product Information [Line Items] | ||||
Revenue | 6,916 | 2,037 | 13,415 | 4,931 |
Product Revenue, Net | GoGoMeds | ||||
Product Information [Line Items] | ||||
Revenue | $ 2,057 | $ 140 | $ 3,072 | 230 |
Product Revenue, Net | CMS Bridging DMCC | ||||
Product Information [Line Items] | ||||
Revenue | $ 119 |
Product Revenue and Reserve a_4
Product Revenue and Reserve and Allowances - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 14, 2022 | |
Product Information [Line Items] | |||||||
Revenue | $ 8,973 | $ 2,178 | $ 16,487 | $ 5,279 | |||
Accounts receivable | 1,256 | 1,256 | $ 731 | ||||
Gelesis | |||||||
Product Information [Line Items] | |||||||
Revenue | 11,185 | $ 21,442 | |||||
Accounts receivable | 731 | 818 | |||||
Product Revenue, Net | |||||||
Product Information [Line Items] | |||||||
Revenue | 8,973 | 2,178 | 16,487 | 5,279 | |||
Product Revenue, Net | Gelesis | |||||||
Product Information [Line Items] | |||||||
Revenue | 11,185 | $ 2,708 | |||||
Product Revenue, Net | Roman Health Pharmacy LLC | |||||||
Product Information [Line Items] | |||||||
Revenue | 6,916 | 2,037 | 13,415 | 4,931 | |||
Product Revenue, Net | Roman Health Pharmacy LLC | Third Amended and Restated Supply and Distribution Agreement | |||||||
Product Information [Line Items] | |||||||
Deferred income | $ 15,000 | ||||||
Product Revenue, Net | Roman Health Pharmacy LLC | Current Liabilities | |||||||
Product Information [Line Items] | |||||||
Deferred income | 32,500 | 32,500 | 31,000 | ||||
Product Revenue, Net | GoGoMeds | |||||||
Product Information [Line Items] | |||||||
Revenue | 2,057 | 140 | 3,072 | 230 | |||
Accounts receivable | 1,300 | $ 800 | 1,300 | 800 | |||
Product Revenue, Net | CMS Bridging DMCC | |||||||
Product Information [Line Items] | |||||||
Revenue | $ 119 | ||||||
Product Revenue, Net | CMS Bridging DMCC | Other Assets | |||||||
Product Information [Line Items] | |||||||
Discounted time-based milestone | $ 4,200 | $ 4,200 | $ 4,100 |
Product Revenue and Reserve a_5
Product Revenue and Reserve and Allowances - Summary of Activity in Product Revenue Reserve and Allowance (Details) - Product Revenue, Net - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Product Information [Line Items] | |||
Product revenue reserve and allowance, beginning balance | $ 82 | $ 14 | $ 14 |
Provision related to product sales | 1,193 | 326 | |
Credits and payments made | (1,154) | (324) | |
Product revenue reserve and allowance, ending balance | $ 121 | $ 16 | $ 82 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 9,599 | $ 8,074 |
Work in process | 4,746 | 2,643 |
Finished goods | 4,476 | 2,786 |
Total inventories | $ 18,821 | $ 13,503 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |||
Prepaid expenses | $ 1,128,000 | $ 982,000 | $ 65,973 |
Prepaid Insurance | 1,474,000 | 55,000 | |
Prepaid manufacturing expenses | 596,000 | 2,624,000 | |
Prepaid contract research costs | 185,000 | 262,000 | |
Research and development tax credit | 692,000 | 579,000 | |
Value added tax receivable | 1,574,000 | 5,633,000 | |
Deferred financing costs | 3,855,000 | ||
Income tax receivable | 198,000 | 213,000 | |
Investment tax credit | 906,000 | ||
Prepaid expenses and other current assets | $ 6,753,000 | $ 14,203,000 |
Property and Equipment, Net - S
Property and Equipment, Net - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | $ 62,278 | $ 62,907 |
Less accumulated depreciation | (5,973) | (4,392) |
Property and equipment - net | 56,305 | 58,515 |
Laboratory and Manufacturing Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | 28,158 | 28,101 |
Land and Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | 10,186 | 10,404 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | 1,490 | 1,614 |
Computer Equipment and Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | 529 | 463 |
Capitalized Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | 232 | 228 |
Construction in Process | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - at cost | $ 21,683 | $ 22,097 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 USD ($) a ft² | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) a ft² | Jun. 30, 2021 USD ($) | |
Property Plant And Equipment [Abstract] | ||||
Area of facility under manufacturing and research and development | 51,000 | 51,000 | ||
Area of facility under manufacturing and research and development expects to expand | 88,600 | 88,600 | ||
Area of land | a | 12 | 12 | ||
Additional area of facility initiated for construction | 207,000 | 207,000 | ||
Depreciation | $ | $ 400 | $ 200 | $ 1,440 | $ 358 |
Accrued Expenses - Summary of A
Accrued Expenses - Summary of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Payables And Accruals [Abstract] | ||
Accrued payroll and related benefits | $ 2,442 | $ 1,384 |
Accrued professional fees and outside contractors (including due to related party of $179 and $60, respectively) | 2,392 | 4,359 |
Accrued property, plant and equipment additions | 589 | 1,257 |
Accrued inventory and manufacturing expense | 285 | 128 |
Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) | 2,612 | 5,604 |
Tax payables | 70 | 145 |
Deferred legal fees | 738 | 738 |
Accrued interest | 587 | 45 |
Total accrued expenses | 9,715 | 13,660 |
Accrued Professional fee, due to related party | $ 179 | $ 60 |
Other Long-Term Liabilities (De
Other Long-Term Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Other Liabilities Disclosure [Abstract] | |||
Long-term tax liabilities | $ 91 | $ 182 | |
Long-term tax liabilities | 91 | 182 | |
Contingent loss for research and development tax credits | 2,755 | 2,990 | |
One Srl call option (see Note 11) | 3,062 | 2,416 | |
Total other long-term liabilities | 5,908 | 5,588 | |
Contingent loss for research and development tax credits | 2,755 | 2,990 | |
One S.r.l. call option (see Note 11) | 3,062 | 2,416 | |
Total other long-term liabilities | $ 5,908 | 5,588 | |
Gelesis | |||
Other Liabilities Disclosure [Abstract] | |||
Long-term tax liabilities | 182 | $ 301 | |
Deferred IPO fees | 738 | ||
Long-term tax liabilities | 182 | 301 | |
Contingent loss for research and development tax credits | 2,990 | 3,233 | |
Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) | 5,912 | ||
One Srl call option (see Note 11) | 2,416 | 1,545 | |
Total other long-term liabilities | 5,588 | 11,729 | |
Contingent loss for research and development tax credits | 2,990 | 3,233 | |
One S.r.l. call option (see Note 11) | 2,416 | 1,545 | |
Total other long-term liabilities | $ 5,588 | $ 11,729 |
Significant Agreements - Additi
Significant Agreements - Additional Information (Details) $ in Thousands, € in Millions | 1 Months Ended | 6 Months Ended | ||||||
Oct. 31, 2020 EUR (€) | Aug. 31, 2020 EUR (€) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 EUR (€) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 EUR (€) | Jun. 30, 2019 | |
One | ||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||
Equity interest acquired (as a percent) | 10% | 10% | 10% | |||||
Cash consideration | $ 2,900 | |||||||
Remaining undiscounted payments due | 2,600 | € 2.5 | $ 5,700 | € 5 | ||||
Research Innovation Fund Financing | ||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||
Proceeds from RIF | € 10 | 10,400 | ||||||
Principal amount | € 15 | $ 15,700 | ||||||
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% | |||||||
Foreign currency translation gain | $ 900 | |||||||
Debt | € 15 | 15,700 | ||||||
Research Innovation Fund Financing | ||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||
Noncontrolling interest | 11,100 | 11,900 | ||||||
Maximum | Research Innovation Fund Financing | ||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||
Accretion of noncontrolling interest | $ 200 | |||||||
Call Option | One | ||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||
Equity interest acquired (as a percent) | 10% | 10% | ||||||
Exercise price of call option to buy back ownership percentage | € 6 | $ 6,300 | ||||||
Puglia1 Grant | ||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||
Other income | 400 | $ 400 | ||||||
Grant funding for certain facility and equipment investments | 400 | |||||||
Deferred income | 5,500 | 6,400 | ||||||
Deferred income, current liability | 800 | 900 | ||||||
Grant proceeds collected | 0 | |||||||
Grants receivable | 5,000 | 5,400 | ||||||
Puglia1 Grant | Maximum | ||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||
Grant funding for certain research and development expenditures | 100 | 200 | ||||||
Puglia 2 Grant | ||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||
Other income | 1,000 | $ 1,000 | ||||||
Deferred income | 3,400 | 3,700 | ||||||
Deferred income, current liability | 200 | 400 | ||||||
Grant proceeds collected | 0 | |||||||
Grants receivable | $ 4,400 | $ 3,600 |
Significant Agreements - Schedu
Significant Agreements - Schedule of Finite Lived Intangible Assets Amortization Expense (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | ||||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2021 | Jun. 01, 2019 | |
Significant Agreements [Abstract] | ||||||||
Intangible asset at relative fair value | $ 15,564,000 | |||||||
Adjustment to record deferred tax liability | $ 5,783,000 | $ 465,518 | $ 28,719 | |||||
Cumulative amortization expense | (5,667,000) | |||||||
Intangible asset, beginning balance | $ 15,680,000 | |||||||
Amortization expense | $ (566,000) | $ (566,000) | (1,133,000) | $ (1,133,000) | ||||
Intangible asset, ending balance | $ 14,547,000 | $ 14,547,000 | $ 21,347,000 | $ 15,680,000 |
Significant Agreements - Summar
Significant Agreements - Summary of Changes in Fair Value of Call Option Liability (Details) - One S.r.l [Member] $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |
Beginning balance | $ 2,416 |
Change in fair value | 865 |
Foreign currency translation gain | (219) |
Ending balance | $ 3,062 |
Significant Agreements - Summ_2
Significant Agreements - Summary of Weighted Average Assumptions Used to Determine Fair Value of Call Option Liability (Details) - One S.r.l - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||
Expected term | 4 years | 2 years |
Expected Volatility | 64% | 62% |
Expected dividend yield | 0 | 0 |
Risk free interest rate | 3% | 0.70% |
Estimated fair value of ownership interest | $ 6,097 | $ 6,922 |
Exercise price of call option | $ 6,270 | $ 6,806 |
Debt - Summary of Non-convertib
Debt - Summary of Non-convertible Debt Outstanding (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Italian Economic Development Agency Loan | ||
Debt Instrument [Line Items] | ||
Total debt obligation carrying amount | $ 1,400 | |
Non-convertible Debt | ||
Debt Instrument [Line Items] | ||
Total debt obligation | $ 34,208 | 37,835 |
Unamortized loan discount and issuance costs | (1,016) | (754) |
Total debt obligation carrying amount | 33,192 | 37,081 |
Current portion | 3,177 | 1,950 |
Long-term portion | 30,015 | 35,131 |
Non-convertible Debt | Italian Economic Development Agency Loan | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 323 | 525 |
Non-convertible Debt | Intesa Sanpaolo Loan 1 | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 7,384 | 8,507 |
Non-convertible Debt | Intesa Sanpaolo Loan 2 | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 5,225 | 5,672 |
Non-convertible Debt | Horizon 2020 Loan | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 414 | 486 |
Non-convertible Debt | RIF Shareholders Loan | ||
Debt Instrument [Line Items] | ||
Total debt obligation | 15,674 | 17,015 |
Non-convertible Debt | UniCredit Loan | ||
Debt Instrument [Line Items] | ||
Total debt obligation | $ 5,188 | $ 5,630 |
Debt - Additional Information (
Debt - Additional Information (Details) € in Thousands, $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||||||||||
Jan. 19, 2022 USD ($) | Dec. 13, 2021 USD ($) | Nov. 30, 2020 EUR (€) | Nov. 30, 2019 EUR (€) | Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Mar. 31, 2021 EUR (€) | Dec. 31, 2020 EUR (€) | Oct. 31, 2020 EUR (€) | Aug. 31, 2020 EUR (€) | Apr. 30, 2020 USD ($) | Dec. 31, 2019 EUR (€) | May 31, 2014 EUR (€) | |
SSD2 [Member] | ||||||||||||||
Debt | ||||||||||||||
Debt | $ 12,000 | |||||||||||||
Repayment of debt | $ 12,100 | |||||||||||||
Puretech [Member] | ||||||||||||||
Debt | ||||||||||||||
Debt | 15,000 | |||||||||||||
Repayment of debt | 15,200 | |||||||||||||
Gelesis | ||||||||||||||
Debt | ||||||||||||||
Debt | $ 37,081 | |||||||||||||
Gain on extinguishment of debt | $ 297 | |||||||||||||
Gelesis | SSD2 [Member] | ||||||||||||||
Debt | ||||||||||||||
Debt | 12,000 | |||||||||||||
Gelesis | Puretech [Member] | ||||||||||||||
Debt | ||||||||||||||
Debt | 15,000 | |||||||||||||
2021 Bridge Financing | ||||||||||||||
Debt | ||||||||||||||
Notes payable | 27,100 | |||||||||||||
Debt | $ 27,000 | |||||||||||||
Repayment of debt | $ 27,300 | |||||||||||||
Gain Loss on Adjustment for Fair Value of Convertible Promissory Notes | $ 200 | |||||||||||||
Loss on change in fair value of the convertible promissory notes | $ 200 | |||||||||||||
Italian Economic Development Agency Loan | ||||||||||||||
Debt | ||||||||||||||
Debt | 1,400 | |||||||||||||
Italian Economic Development Agency Loan | Gelesis | ||||||||||||||
Debt | ||||||||||||||
Debt | € | € 1,200 | |||||||||||||
Interest rate (as a percent) | 0.332% | |||||||||||||
Intesa Sanpaolo Loan, November 2019 | Gelesis | ||||||||||||||
Debt | ||||||||||||||
Debt | € 2,400 | 2,800 | ||||||||||||
Convertible debt payment due time | 3 months | |||||||||||||
Net of transaction costs | € 100 | 100 | ||||||||||||
Intesa Sanpaolo Loan, November 2019 | Gelesis | Euribor rate | ||||||||||||||
Debt | ||||||||||||||
Interest rate (as a percent) | 2.30% | |||||||||||||
Intesa Sanpaolo Loan, 2020 | Gelesis | ||||||||||||||
Debt | ||||||||||||||
Debt | 5,700 | € 5,000 | ||||||||||||
Net of transaction costs | 14,000 | € 13,000 | ||||||||||||
Intesa Sanpaolo Loan, March 2021 | Gelesis | ||||||||||||||
Debt | ||||||||||||||
Debt | 5,400 | € 4,800 | ||||||||||||
Interest rate (as a percent) | 0.701% | |||||||||||||
Net of transaction costs | 200 | € 200 | ||||||||||||
Intesa Sanpaolo Loan, March 2021 | Gelesis | Minimum [Member] | ||||||||||||||
Debt | ||||||||||||||
Debt | € | € 5,000 | |||||||||||||
Horizon 2020 Loan, December 2019 | Gelesis | ||||||||||||||
Debt | ||||||||||||||
Debt | 300 | € 300 | ||||||||||||
Interest rate (as a percent) | 0.171% | |||||||||||||
Net of transaction costs | 24,000 | € 21,000 | ||||||||||||
Horizon 2020 Loan, October 2020 | Gelesis | ||||||||||||||
Debt | ||||||||||||||
Debt | 200 | € 200 | ||||||||||||
Net of transaction costs | 22,000 | € 19,000,000 | ||||||||||||
RIF Shareholders Loan | Gelesis | ||||||||||||||
Debt | ||||||||||||||
Debt | 16,400 | € 14,500 | ||||||||||||
Interest rate (as a percent) | 6.35% | |||||||||||||
Net of transaction costs | 600 | € 500 | ||||||||||||
UniCredit Loan | Gelesis | ||||||||||||||
Debt | ||||||||||||||
Debt | € 4,900 | 5,700 | ||||||||||||
Net of transaction costs | € 100 | 100 | ||||||||||||
Debt instrument variable rate | 2.12% | |||||||||||||
PPP Loan | Gelesis | ||||||||||||||
Debt | ||||||||||||||
Debt | $ 300 | |||||||||||||
Gain on extinguishment of debt | $ 300 | |||||||||||||
2021 Bridge Financing | Gelesis | ||||||||||||||
Debt | ||||||||||||||
Interest rate (as a percent) | 10% | |||||||||||||
Gain Loss on Adjustment for Fair Value of Convertible Promissory Notes | 100 | |||||||||||||
Percentage on price for conversion | 75 | |||||||||||||
Convertible promissory notes (see Note 12) | $ 27,000 | 27,100 | ||||||||||||
Loss on change in fair value of the convertible promissory notes | $ 100 | |||||||||||||
2021 Bridge Financing | Gelesis | SSD2 [Member] | ||||||||||||||
Debt | ||||||||||||||
Debt | 12,000 | |||||||||||||
2021 Bridge Financing | Gelesis | Puretech [Member] | ||||||||||||||
Debt | ||||||||||||||
Debt | $ 15,000 |
Debt - Summary of Future Maturi
Debt - Summary of Future Maturities to Non-convertible Debt Outstanding (Details) - Non-convertible Debt - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Remaining 2022 obligation | $ 1,362 | |
2023 | 7,909 | |
2024 | 5,315 | |
2025 | 3,868 | |
2026 | 3,889 | |
More than 5 years | 11,865 | |
Total debt obligation carrying amount | $ 34,208 | $ 37,835 |
Warrant Liabilities - Summary o
Warrant Liabilities - Summary of Warrants Outstanding (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Class Of Warrant Or Right [Line Items] | |
Beginning balance | $ 15,821 |
Assumed upon Business Combination | 8,140 |
Change in fair value | (6,084) |
Conversion and exchange upon Business Combination | (16,747) |
Ending balance | 1,130 |
Series A-4 redeemable convertible preferred stock ("Series A-4") | |
Class Of Warrant Or Right [Line Items] | |
Beginning balance | 15,821 |
Change in fair value | 926 |
Conversion and exchange upon Business Combination | (16,747) |
Ending balance | |
Private Placement | |
Class Of Warrant Or Right [Line Items] | |
Assumed upon Business Combination | 8,140 |
Change in fair value | (7,010) |
Ending balance | $ 1,130 |
Warrant Liabilities - Summary_2
Warrant Liabilities - Summary of Weighted Average Assumptions of Fair Value of Liabilities (Details) - Private Placement - Level 3 - Monte Carlo Simulation value model | Jun. 30, 2022 Y |
Expected term | |
Class Of Warrant Or Right [Line Items] | |
Private Placement Warrants | 4.5 |
Expected Volatility | |
Class Of Warrant Or Right [Line Items] | |
Private Placement Warrants | 62 |
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 | 3 |
Price Of Gelesis Common Stock | |
Class Of Warrant Or Right [Line Items] | |
Private Placement Warrants | 1.55 |
Exercise Price of Warrants | |
Class Of Warrant Or Right [Line Items] | |
Private Placement Warrants | 11.50 |
Warrant Liabilities - Additiona
Warrant Liabilities - Additional Information (Details) - $ / shares | Jun. 30, 2022 | Jul. 07, 2020 |
Class Of Warrant Or Right [Line Items] | ||
Exercise price of warrants | $ 11.50 | |
Private Placement | ||
Class Of Warrant Or Right [Line Items] | ||
Class of Warrant or Right, Outstanding | 7,520,000 | |
Private Placement | Class A common stock | ||
Class Of Warrant Or Right [Line Items] | ||
Exercise price of warrants | $ 11.50 |
Earnout Liability - Additional
Earnout Liability - Additional Information (Details) | 6 Months Ended |
Jun. 30, 2022 shares | |
Derivatives, Fair Value [Line Items] | |
Number of earn out shares unissued and unvested | 18,758,241 |
Earnout Liability | |
Derivatives, Fair Value [Line Items] | |
Number of earn out shares unissued and unvested | 18,758,241 |
Earnout Liability - Summary of
Earnout Liability - Summary of Earnout Liability Activity (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Derivative Instrument Detail [Abstract] | |
Balance | |
Recognized upon Business Combination | 58,871 |
Changes in fair value | (52,681) |
Balance | $ 6,190 |
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 | Jun. 30, 2022 Y USD ($) |
Expected term | |
Derivatives, Fair Value [Line Items] | |
Derivative Liability Measurement Input | Y | 4.5 |
Expected Volatility | |
Derivatives, Fair Value [Line Items] | |
Derivative Liability Measurement Input | 62 |
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 | 3 |
Price Of Gelesis Common Stock | |
Derivatives, Fair Value [Line Items] | |
Derivative Liability Measurement Input | $ | 1.55 |
Stockholder's Equity (Deficit_2
Stockholder's Equity (Deficit) - Additional Information (Details) $ / shares in Units, $ in Millions | 6 Months Ended | ||||||
Jan. 13, 2022 shares | Jun. 30, 2022 USD ($) D $ / shares shares | Mar. 31, 2022 $ / shares | Dec. 31, 2021 $ / shares shares | Jul. 19, 2021 $ / shares shares | Dec. 31, 2020 $ / shares shares | Jul. 07, 2020 $ / shares | |
Class of Stock [Line Items] | |||||||
Common shares, shares authorized (in shares) | 900,000,000 | 125,961,571 | |||||
Common shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||
Common shares, shares issued (in shares) | 72,552,477 | 6,248,192 | |||||
Common shares, shares outstanding (in shares) | 72,552,477 | 6,248,192 | |||||
Preferred stock, shares authorized | 250,000,000 | 1,000,000 | 1,000,000 | ||||
Preferred stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Exercise price of warrants | $ / shares | $ 11.50 | ||||||
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) | 72,552,477 | ||||||
Common shares, shares outstanding (in shares) | 72,214,287 | 72,552,477 | |||||
Legacy Gelesis Redeemable Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Convertible preferred stock exchange ratio | 2.59 | ||||||
Convertible preferred stock, terms of conversion | Immediately prior to the closing of the Business Combination, Legacy Gelesis redeemable convertible preferred stock converted into Legacy Gelesis common stock and was 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. | ||||||
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 | D | 20 | ||||||
Minimum threshold written notice period for redemption of public warrants | D | 30 | ||||||
Threshold number of business days before sending notice of redemption to warrant holders | D | 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 | $ 4.26 | ||||
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 rollover common stock warrants 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 | 1,660,303 | 1,836,429 | |||||
Exercise price of warrants | $ / shares | $ 0.02 | ||||||
Warrants exchange ratio | 2.59 | ||||||
Roller Warrants | Maximum | |||||||
Class of Stock [Line Items] | |||||||
Proceeds from warrants exercised | $ | $ 0.1 |
Stockholder's Equity (Deficit_3
Stockholder's Equity (Deficit) - Schedule of Common Stock Reserved for Future Issuance (Details) - shares | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Jul. 07, 2020 |
Common Stock | ||||||
Common stock issued upon option exercise and RSUs vesting | 20,000,493 | 13,486,708 | ||||
Sale of Private Placement Warrants (in shares) | 24,333,365 | 1,353,062 | 7,520,000 | |||
Earnout shares | 23,482,845 | |||||
Total common stock reserved for future issuance | 67,816,703 | 65,242,854 | ||||
Legacy Gelesis Redeemable Convertible Preferred Stock | ||||||
Common Stock | ||||||
Conversion of all classes of redeemable convertible preferred stock | 0 | 48,566,655 | 48,566,655 | 48,566,655 | 47,813,946 | |
Series A-4 | ||||||
Common Stock | ||||||
Sale of Private Placement Warrants (in shares) | 1,836,429 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Total fair value of options vested | $ 2.4 | ||
Restricted Stock Units (RSUs) | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized compensation cost | $ 16 | $ 6.7 | |
Weighted-average period of unrecognized compensation cost expected to be recognized | 2 years 9 months 18 days | 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 | 2,370,188 | ||
Increase in percentage, number of shares of stock issued and outstanding | 4% | ||
Expiration period of awards granted | 10 years | ||
Weighted-average grant date fair value of stock options granted | $ 2.17 | ||
Unrecognized compensation cost | $ 13.7 | $ 8.7 | |
Weighted-average period of unrecognized compensation cost expected to be recognized | 2 years 4 months 24 days | 2 years 2 months 12 days | |
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 | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 7,976 | $ 1,639 | $ 21,965 | $ 3,094 |
Research and Development | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | 3,008 | 494 | 8,073 | 1,061 |
General and Administrative | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 4,968 | $ 1,145 | $ 13,892 | $ 2,033 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Number of Options, Outstanding | 12,674,486 | |
Number of Options, Granted | 2,658,185 | |
Number of Options, Exercised | (162,064) | |
Number of Options, Forfeited - unvested | (17,281) | |
Number of Options, Forfeited - vested | (63,718) | |
Number of Options, Expired | (456,534) | |
Number of Options, Outstanding | 14,633,074 | 12,674,486 |
Number of Options, Exercisable | 9,780,237 | |
Number of Options, Vested and expected to vest | 14,633,074 | |
Weighted Average Exercise Price per Share | ||
Weighted- Average Exercise Price per Share, Outstanding | $ 4.01 | |
Weighted- Average Exercise Price per Share, Granted | 3.35 | |
Weighted- Average Exercise Price per Share, Exercised | 0.68 | |
Weighted- Average Exercise Price per Share, Forfeited - unvested | 5.56 | |
Weighted- Average Exercise Price per Share, Forfeited - vested | 4.31 | |
Weighted- Average Exercise Price per Share, Expired | 1.23 | |
Weighted- Average Exercise Price per Share, Outstanding | 4.01 | $ 4.01 |
Weighted- Average Exercise Price per Share, Exercisable | 3.81 | |
Weighted- Average Exercise Price per Share, Vested and expected to vest | $ 4.01 | |
Weighted Average Remaining Contractual Term (Years) | ||
Weighted- Average Remaining Contractual Term (Years), Outstanding | 6 years 7 months 28 days | 6 years 2 months 1 day |
Weighted- Average Remaining Contractual Term (Years), Exercisable | 5 years 5 months 4 days | |
Weighted- Average Remaining Contractual Term (Years), Vested and expected to vest | 6 years 7 months 28 days | |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value, Outstanding | $ 840 | $ 54,449 |
Aggregate Intrinsic Value, Exercisable | 840 | |
Aggregate Intrinsic Value, Vested and expected to vest | $ 840 | |
Previously Reported | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Number of Options, Outstanding | 4,889,820 | |
Number of Options, Outstanding | 4,889,820 | |
Weighted Average Exercise Price per Share | ||
Weighted- Average Exercise Price per Share, Outstanding | $ 10.39 | |
Weighted- Average Exercise Price per Share, Outstanding | $ 10.39 | |
Weighted Average Remaining Contractual Term (Years) | ||
Weighted- Average Remaining Contractual Term (Years), Outstanding | 6 years 2 months 1 day | |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value, Outstanding | $ 54,449 | |
Retroactive Application of Reverse Recapitalization | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Number of Options, Outstanding | 7,784,666 | |
Number of Options, Outstanding | 7,784,666 | |
Weighted Average Exercise Price per Share | ||
Weighted- Average Exercise Price per Share, Outstanding | $ (6.38) | |
Weighted- Average Exercise Price per Share, Outstanding | $ (6.38) |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Grant Date Fair Value of Options Issued Using Black-Scholes Weighted Average Assumptions (Details) | 6 Months Ended |
Jun. 30, 2022 $ / shares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Market price of common stock | $ 3.35 |
Expected volatility | 0.724% |
Expected term (in years) | 6 years 1 month 6 days |
Risk-free interest rate | 0.017% |
Expected dividend yield | 0% |
Stock-Based Compensation - Su_3
Stock-Based Compensation - Summary of Restricted Stock Unit Activity (Details) - Restricted Stock Units (RSUs) | 6 Months Ended |
Jun. 30, 2022 $ / shares shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of RSUs, Outstanding and Unvested | shares | 812,222 |
Number of RSUs, Granted | shares | 4,555,197 |
Number of RSUs, Vested | shares | (17,654) |
Number of RSUs, Outstanding and Unvested | shares | 5,349,765 |
Weighted- Average Grant Date Fair Value, Outstanding and Unvested | $ / shares | $ 8.26 |
Weighted- Average Grant Date Fair Value, Granted | $ / shares | 3.46 |
Weighted- Average Grant Date Fair Value, Vested | $ / shares | 8.26 |
Weighted- Average Grant Date Fair Value, Outstanding and Unvested | $ / shares | $ 4.18 |
Previously Reported | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of RSUs, Outstanding and Unvested | shares | 313,354 |
Number of RSUs, Outstanding and Unvested | shares | |
Weighted- Average Grant Date Fair Value, Outstanding and Unvested | $ / shares | $ 21.41 |
Weighted- Average Grant Date Fair Value, Outstanding and Unvested | $ / shares | |
Retroactive Application of Reverse Recapitalization | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of RSUs, Outstanding and Unvested | shares | 498,868 |
Number of RSUs, Outstanding and Unvested | shares | |
Weighted- Average Grant Date Fair Value, Outstanding and Unvested | $ / shares | $ (13.15) |
Weighted- Average Grant Date Fair Value, Outstanding and Unvested | $ / shares |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||||||
Provision for income taxes | $ 0 | $ 0 | $ 0 | $ 17,000 | $ 0 | $ 0 |
U.S statutory rate | 21% | 21% | 21% | 21% | 21% | 21% |
Earnings (Loss) Per Share - Sum
Earnings (Loss) Per Share - Summary of Basic and Diluted Net Loss Per Share (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | ||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | |
Numerator: | ||||||||
Net loss | $ (12,513,000) | $ (5,703,000) | $ (24,739,000) | $ (18,586,000) | $ (18,216,000) | $ (43,325,000) | $ (15,294,860) | $ (12,898,082) |
Accretion of redeemable convertible preferred stock to redemption value | (82,365,000) | (37,934,000) | (116,126,000) | |||||
Accretion of noncontrolling interest put option to redemption value | (85,000) | (96,000) | (173,000) | (190,000) | ||||
Net loss attributable to common stockholders | $ (12,598,000) | $ (107,200,000) | $ (56,323,000) | $ (159,641,000) | ||||
Denominator: | ||||||||
Weighted average common shares outstanding, basic and diluted | 72,423,043 | 5,589,728 | 67,609,838 | 5,592,911 | ||||
Net loss per share, basic and diluted | $ (0.17) | $ (19.18) | $ (0.83) | $ (28.54) |
Earnings (Loss) Per Share - Sch
Earnings (Loss) Per Share - Schedule of Anti-dilutive Securities Excluded from Computation of Net Loss Per Share (Details) - shares | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from computation of net loss per share | 44,333,858 | 65,380,739 | 21,320,000 |
Warrants on Convertible Preferred Stock | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from computation of net loss per share | 1,836,429 | ||
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 | 20,000,493 | 13,624,593 | |
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 | 24,333,365 | 1,353,062 | |
Convertible Preferred Stock | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from computation of net loss per share | 48,566,655 |
Earnings (Loss) per Share (Addi
Earnings (Loss) per Share (Additional Information) (Details) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2022 shares | Jun. 30, 2022 shares | Jan. 13, 2022 | |
Earnings Per Share [Abstract] | |||
Potentially dilutive common share equivalents | 23,482,845 | 23,482,845 | |
Common stock exchange ratio | 2.59 |
Commitment and Contingencies -
Commitment and Contingencies - Additional Information (Details) € in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2019 USD ($) | Dec. 31, 2009 | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 EUR (€) | Dec. 31, 2021 USD ($) | |
Loss Contingencies [Line Items] | ||||||||
Operating lease commencement | 2019-06 | |||||||
Operating lease expiration | 2025-08 | |||||||
Total lease payments | $ 1,923,000 | $ 1,923,000 | ||||||
Operating lease right-of-use assets | 1,725,000 | 1,725,000 | $ 2,016,000 | |||||
Short-term lease liabilities | 550,000 | 550,000 | 541,000 | |||||
Long-term lease liabilities | 1,222,000 | 1,222,000 | $ 1,519,000 | |||||
Operating lease expense | $ 200,000 | $ 200,000 | $ 300,000 | $ 300,000 | ||||
Operating lease remaining lease terms | 3 years 2 months 12 days | 3 years 2 months 12 days | 3 years 2 months 12 days | 3 years 8 months 12 days | ||||
Operating lease weighted average discount rate, percent | 5.90% | 5.90% | 5.90% | |||||
Other long-term liabilities | $ 5,908,000 | $ 5,908,000 | $ 5,588,000 | |||||
Office space located in Boston | ||||||||
Loss Contingencies [Line Items] | ||||||||
Total lease payments | $ 3,200,000 | |||||||
Research and Development Tax credits | ||||||||
Loss Contingencies [Line Items] | ||||||||
Other long-term liabilities | 2,800,000 | $ 2,800,000 | $ 3,000,000 | |||||
PureTech | Royalty and Sublicense Income Agreement | ||||||||
Loss Contingencies [Line Items] | ||||||||
Royalty payment required percentage | 2% | |||||||
One S.r.l [Member] | Amended And Restated Master Agreement | ||||||||
Loss Contingencies [Line Items] | ||||||||
Percentage of royalty | 2% | |||||||
Payments to be made upon the achievement of certain milestones | $ 18,300,000 | $ 18,300,000 | € 17.5 |
Commitment and Contingencies _2
Commitment and Contingencies - Schedule of Future Maturities of the Lease Liability Under the Company's Noncancelable Operating Leases (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
Remaining 2022 maturities | $ 313 |
2023 | 629 |
2024 | 553 |
2025 | 383 |
2026 | 30 |
More than 5 Years | 15 |
Total undiscounted lease maturities | 1,923 |
Imputed interest | (151) |
Total lease liability | $ 1,772 |
Related Party Transactions - _2
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | 24 Months Ended | ||||||
Jan. 19, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 13, 2021 | Jun. 30, 2019 | |
Related Party Transaction [Line Items] | ||||||||||
Accounts payable, due to related party | $ 303 | $ 303 | $ 147 | $ 147 | ||||||
Loss of change in fair value of the instrument | (156) | |||||||||
PureTech | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Principal amount | $ 15,000 | |||||||||
Repayment of debt | $ 15,200 | |||||||||
PureTech | Management Services Expenses | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Research and development, including related party expenses | 100 | $ 100 | $ 200 | |||||||
Accounts payable, due to related party | 100 | 100 | 100 | 100 | ||||||
Notes payable | 15,100 | 15,100 | ||||||||
Loss of change in fair value of the instrument | 100 | |||||||||
PureTech | Royalty Expense | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Research and development, including related party expenses | $ 200 | $ 100 | 300 | $ 100 | ||||||
SSD2 | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Principal amount | 12,000 | |||||||||
Loss of change in fair value of the instrument | $ 100 | |||||||||
Repayment of debt | $ 12,100 | |||||||||
SSD2 | Management Services Expenses | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Notes payable | 12,100 | 12,100 | ||||||||
Gelesis | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Research and development, including related party expenses | 447 | $ 108 | ||||||||
Accounts payable, due to related party | 147 | 93 | 147 | |||||||
Principal amount | 37,081 | 37,081 | ||||||||
Received from equity investment | $ 17,374 | |||||||||
Gelesis | PureTech | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Principal amount | 15,000 | |||||||||
Gelesis | PureTech | Management Services Expenses | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Research and development, including related party expenses | 500 | |||||||||
Accounts payable, due to related party | 100 | 100 | 100 | |||||||
Notes payable | 15,100 | 15,100 | ||||||||
Gelesis | PureTech | Royalty Expense | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Research and development, including related party expenses | 200 | $ 100 | ||||||||
Gelesis | SSD2 | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Principal amount | $ 12,000 | |||||||||
Gelesis | SSD2 | Management Services Expenses | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Notes payable | $ 12,100 | $ 12,100 |
Related Party Transactions - _3
Related Party Transactions - Additional Information - One S.r.l (Details) $ in Thousands, € in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2022 EUR (€) | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 EUR (€) | Dec. 31, 2020 USD ($) | |
Founder of One | Consulting Agreement | Maximum | ||||||||
Related Party Transaction [Line Items] | ||||||||
Research and development, including related party expenses | $ 100 | $ 100 | $ 100 | $ 100 | ||||
Outstanding accrued expenses and remaining undiscounted payments, related parties | 100 | 100 | $ 100 | |||||
One S.r.l [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Outstanding accrued expenses and remaining undiscounted payments, related parties | 200 | 200 | ||||||
Payments related to acquisition | 2,600 | € 2.5 | 5,700 | € 5 | ||||
Notes payable | 100 | 100 | ||||||
One S.r.l [Member] | Maximum | ||||||||
Related Party Transaction [Line Items] | ||||||||
Outstanding accrued expenses and remaining undiscounted payments, related parties | 100 | |||||||
One S.r.l [Member] | Consulting Agreement | ||||||||
Related Party Transaction [Line Items] | ||||||||
Payments related to acquisition | 2,900 | |||||||
One S.r.l [Member] | Royalty Expense | ||||||||
Related Party Transaction [Line Items] | ||||||||
Payments related to acquisition | $ 200 | $ 100 | $ 100 | |||||
One S.r.l [Member] | Royalty Expense | Maximum | ||||||||
Related Party Transaction [Line Items] | ||||||||
Payments related to acquisition | $ 300 | |||||||
Gelesis | ||||||||
Related Party Transaction [Line Items] | ||||||||
Research and development, including related party expenses | 447 | $ 108 | ||||||
Outstanding accrued expenses and remaining undiscounted payments, related parties | 5,664 | 109 | ||||||
Gelesis | Consulting Agreement | ||||||||
Related Party Transaction [Line Items] | ||||||||
Research and development, including related party expenses | $ 300 | |||||||
Gelesis | Founder of One | Consulting Agreement | ||||||||
Related Party Transaction [Line Items] | ||||||||
Research and development, including related party expenses | 300 | |||||||
Outstanding accrued expenses and remaining undiscounted payments, related parties | $ 100 |
Related Party Transactions - _4
Related Party Transactions - Additional Information - RIF (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | |
Aug. 31, 2020 | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
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 | $ 12,300 | |||
Equity interest held by related party | 20% | |||
Loan from related party | $ 18,400 | |||
Fixed interest rate on loan | 6.35% | |||
Gelesis | ||||
Related Party Transaction [Line Items] | ||||
Loan from related party | $ 5,664 | $ 109 | ||
Gelesis | 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% | |||
Gelesis | 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% |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) $ / shares in Units, € in Millions | 11 Months Ended | |||||||
Aug. 11, 2022 USD ($) shares | Aug. 04, 2022 USD ($) D item $ / shares shares | Dec. 31, 2020 USD ($) | Aug. 09, 2022 $ / shares | Aug. 09, 2022 EUR (€) shares | Jun. 30, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | Jul. 07, 2020 $ / shares shares | |
Subsequent Event [Line Items] | ||||||||
Warrants to purchase common stock | shares | 24,333,365 | 1,353,062 | 7,520,000 | |||||
Common stock, par value | $ 0.0001 | $ 0.0001 | ||||||
Exercise price of warrants | $ 11.50 | |||||||
Stock Issued during period, Value, New issues | $ | $ 25,000 | |||||||
One S.r.l | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Deferred payment of remaining purchase price | € | € 2.5 | |||||||
Common stock warrants | shares | 1,353,062 | |||||||
One S.r.l | Minimum | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Exercise price of warrants | $ 1.45 | |||||||
One S.r.l | Maximum | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Exercise price of warrants | $ 4.26 | |||||||
Committed Equity Facility with B. Riley Principal Capital II, LLC | Subsequent Event | Common Stock | ||||||||
Subsequent Event [Line Items] | ||||||||
Stock Issued during period, Shares, New issues | shares | 14,506,475 | |||||||
Aggregate number of shares of the common stock percentage | 19.99% | |||||||
Committed Equity Facility with B. Riley Principal Capital II, LLC | Maximum | Subsequent Event | Common Stock | ||||||||
Subsequent Event [Line Items] | ||||||||
Stock Issued during period, Value, New issues | $ | $ 50,000,000 | |||||||
CMS Bridging DMCC | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Non-refundable and non-creditable regulatory approval milestone payment | $ | $ 5,000,000 | |||||||
Common stock, par value | $ 0.0001 | |||||||
Exercise price of warrants | $ 0.01 | |||||||
Warrants expiration term | 10 years | |||||||
CMS Bridging DMCC | Maximum | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Warrants to purchase common stock | shares | 400,000 | |||||||
Promissory Notes | CMS Bridging DMCC, PureTech Health LLC and SSD2 LLC | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Number of promissory notes issued | item | 3 | |||||||
Aggregate principal amount of notes | $ | $ 25,000,000 | |||||||
Aggregate cash purchase price | $ | $ 25,000,000 | |||||||
Promissory Notes | CMS Bridging DMCC | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Interest rate | 15% | |||||||
Maturity date | Dec. 31, 2023 | |||||||
Threshold number of business days following a qualified financing | D | 5 | |||||||
Promissory Notes | PureTech Health LLC | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Interest rate | 15% | |||||||
Maturity date | Dec. 31, 2023 | |||||||
Threshold number of business days following a qualified financing | D | 5 | |||||||
Promissory Notes | SSD2 LLC | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Interest rate | 15% | |||||||
Maturity date | Dec. 31, 2023 | |||||||
Threshold number of business days following a qualified financing | D | 5 |
CONSOLIDATED BALANCE SHEETS_2
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash | $ 28,397,000 | $ 491,827 |
Accounts receivable | 731,000 | |
Inventories | 13,503,000 | |
Prepaid expenses and other current assets | 14,203,000 | |
Total current assets | 66,006,000 | 557,800 |
Property and equipment, net | 58,515,000 | |
Operating lease right-of-use assets | 2,016,000 | |
Intangible assets, net | 15,680,000 | |
Other assets | 4,084,000 | |
Total assets | 146,301,000 | 276,767,253 |
Current liabilities: | ||
Accounts payable, including due to related party of $147 and $93, respectively | 10,066,000 | |
Accrued expenses and other current liabilities, including due to related party of $5,664 and $109 respectively | 13,660,000 | |
Operating lease liabilities | 541,000 | |
Notes payable | 1,950,000 | |
Warrant liabilities | 15,821,000 | |
Total current liabilities | 101,536,000 | |
Operating lease liabilities | 1,519,000 | |
Notes payable, including due to related party of $16,523 and $18,936, respectively | 35,131,000 | |
Other long-term liabilities, including due to related party of $3,062 and $2,416, respectively | 5,588,000 | |
Total liabilities | 152,688,000 | 41,392,640 |
Commitments (Note 6) | ||
Noncontrolling interest | 11,855,000 | |
Stockholders' equity (deficit): | ||
Common stock | 1,000 | |
Additional paid-in capital | (64,549,000) | |
Accumulated other comprehensive income | 219,000 | |
Accumulated deficit | (265,507,000) | (171,784,000) |
Total stockholders' equity (deficit) | (329,836,000) | (40,658,834) |
Total liabilities, noncontrolling interest, redeemable convertible preferred stock and stockholders' equity (deficit) | 146,301,000 | 276,767,253 |
Gelesis | ||
Current assets: | ||
Cash | 28,397,000 | 48,144,000 |
Marketable securities | 23,998,000 | 23,998,000 |
Accounts receivable | 731,000 | 818,000 |
Grants receivable | 9,172,000 | 8,116,000 |
Inventories | 13,503,000 | 5,122,000 |
Prepaid expenses and other current assets | 14,203,000 | 6,677,000 |
Total current assets | 66,006,000 | 92,875,000 |
Property and equipment, net | 58,515,000 | 46,895,000 |
Operating lease right-of-use assets | 2,016,000 | 2,167,000 |
Intangible assets, net | 15,680,000 | 17,947,000 |
Other assets | 4,084,000 | 3,959,000 |
Total assets | 146,301,000 | 163,843,000 |
Current liabilities: | ||
Accounts payable, including due to related party of $147 and $93, respectively | 10,066,000 | 8,322,000 |
Accrued expenses and other current liabilities, including due to related party of $5,664 and $109 respectively | 13,660,000 | 7,320,000 |
Deferred income | 32,370,000 | 624,000 |
Operating lease liabilities | 541,000 | 421,000 |
Convertible promissory notes due to related party, held at fair value | 27,128,000 | |
Notes payable | 1,950,000 | 254,000 |
Warrant liabilities | 15,800,000 | 600,000 |
Total current liabilities | 101,536,000 | 17,522,000 |
Deferred income | 8,914,000 | 8,276,000 |
Operating lease liabilities | 1,519,000 | 1,780,000 |
Notes payable, including due to related party of $16,523 and $18,936, respectively | 35,131,000 | 34,002,000 |
Warrant liabilities | 11,500,000 | |
Other long-term liabilities, including due to related party of $3,062 and $2,416, respectively | 5,588,000 | 11,729,000 |
Total liabilities | 152,688,000 | 84,827,000 |
Commitments (Note 6) | ||
Noncontrolling interest | 11,855,000 | 12,429,000 |
Redeemable convertible preferred stock | ||
Redeemable convertible preferred stock | 213,525,000 | |
Stockholders' equity (deficit): | ||
Common stock | 1,000 | 1,000 |
Additional paid-in capital | (64,549,000) | 23,907,000 |
Accumulated other comprehensive income | 219,000 | 938,000 |
Accumulated deficit | (265,507,000) | (171,784,000) |
Total stockholders' equity (deficit) | (329,836,000) | (146,938,000) |
Total liabilities, noncontrolling interest, redeemable convertible preferred stock and stockholders' equity (deficit) | 146,301,000 | 163,843,000 |
Gelesis | Warrants | ||
Current liabilities: | ||
Warrant liabilities | 15,821,000 | 581,000 |
Warrant liabilities | 11,518,000 | |
Gelesis | Series A-1 | ||
Redeemable convertible preferred stock | ||
Redeemable convertible preferred stock | 7,113,000 | 6,176,000 |
Gelesis | Series A-2 | ||
Redeemable convertible preferred stock | ||
Redeemable convertible preferred stock | 3,033,000 | 3,033,000 |
Gelesis | Series A3 Redeemable Convertible Preferred Stock [Member] | ||
Redeemable convertible preferred stock | ||
Redeemable convertible preferred stock | 7,460,000 | 4,463,000 |
Gelesis | Series A4 Redeemable Convertible Preferred Stock [Member] | ||
Redeemable convertible preferred stock | ||
Redeemable convertible preferred stock | 2,602,000 | 2,602,000 |
Gelesis | Series A-5 | ||
Redeemable convertible preferred stock | ||
Redeemable convertible preferred stock | 44,307,000 | 24,991,000 |
Gelesis | Series Growth | ||
Redeemable convertible preferred stock | ||
Redeemable convertible preferred stock | 56,959,000 | 32,763,000 |
Gelesis | Series 2 Growth | ||
Redeemable convertible preferred stock | ||
Redeemable convertible preferred stock | 53,201,000 | 30,684,000 |
Gelesis | Series 3 Growth | ||
Redeemable convertible preferred stock | ||
Redeemable convertible preferred stock | $ 136,919,000 | $ 108,813,000 |
CONSOLIDATED BALANCE SHEETS (_2
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Accounts payable, due to related party | $ 147 | |
Notes payable, due to related party | $ 16,523 | |
Common stock, par value | $ 0.0001 | |
Common stock, shares authorized | 125,961,571 | |
Common stock, shares issued | 6,248,192 | |
Common stock, shares outstanding | 6,248,192 | |
Gelesis | ||
Accounts payable, due to related party | $ 147 | $ 93 |
Outstanding accrued expenses and remaining undiscounted payments, related parties | 5,664 | 109 |
Notes payable, due to related party | 16,523 | 18,936 |
Other long-term liabilities, due to related party | $ 2,416 | $ 7,457 |
Redeemable convertible preferred stock, par value | $ 0.0001 | $ 0.0001 |
Redeemable convertible preferred stock, shares authorized | 19,957,625 | 19,957,625 |
Temporary equity, shares issued | 18,446,525 | |
Temporary equity, shares outstanding | 18,446,525 | |
Redeemable convertible preferred stock, aggregate liquidation preference | $ 257,424 | |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 48,595,723 | 48,595,723 |
Common stock, shares issued | 2,410,552 | 2,155,490 |
Common stock, shares outstanding | 2,410,552 | 2,155,490 |
Series A-1 | Gelesis | ||
Redeemable convertible preferred stock, shares authorized | 1,711,755 | 1,711,755 |
Redeemable convertible preferred stock, shares designated | 1,711,755 | 1,711,755 |
Temporary equity, shares issued | 1,689,193 | 1,636,971 |
Temporary equity, shares outstanding | 1,689,193 | 1,636,971 |
Redeemable convertible preferred stock, aggregate liquidation preference | $ 7,505 | $ 7,273 |
Series A-2 | Gelesis | ||
Redeemable convertible preferred stock, shares authorized | 1,161,254 | 1,161,254 |
Redeemable convertible preferred stock, shares designated | 1,161,254 | 1,161,254 |
Temporary equity, shares issued | 1,161,254 | 1,161,254 |
Temporary equity, shares outstanding | 1,161,254 | 1,161,254 |
Redeemable convertible preferred stock, aggregate liquidation preference | $ 3,030 | $ 3,030 |
Series A3 Redeemable Convertible Preferred Stock [Member] | Gelesis | ||
Redeemable convertible preferred stock, shares authorized | 1,730,874 | 1,730,874 |
Redeemable convertible preferred stock, shares designated | 1,730,874 | 1,730,874 |
Temporary equity, shares issued | 1,730,874 | 1,492,685 |
Temporary equity, shares outstanding | 1,730,874 | 1,492,685 |
Redeemable convertible preferred stock, aggregate liquidation preference | $ 5,188 | $ 4,474 |
Series A4 Redeemable Convertible Preferred Stock [Member] | Gelesis | ||
Redeemable convertible preferred stock, shares authorized | 2,159,022 | 2,159,022 |
Redeemable convertible preferred stock, shares designated | 2,159,022 | 2,159,022 |
Temporary equity, shares issued | 1,450,529 | 1,450,529 |
Temporary equity, shares outstanding | 1,450,529 | 1,450,529 |
Redeemable convertible preferred stock, aggregate liquidation preference | $ 5,473 | $ 5,473 |
Series A-5 | Gelesis | ||
Redeemable convertible preferred stock, shares authorized | 1,977,114 | 1,977,114 |
Redeemable convertible preferred stock, shares designated | 1,977,114 | 1,977,114 |
Temporary equity, shares issued | 1,977,114 | 1,977,114 |
Temporary equity, shares outstanding | 1,977,114 | 1,977,114 |
Redeemable convertible preferred stock, aggregate liquidation preference | $ 24,536 | $ 24,536 |
Series Growth | Gelesis | ||
Redeemable convertible preferred stock, shares authorized | 2,538,274 | 2,538,274 |
Redeemable convertible preferred stock, shares designated | 2,538,274 | 2,538,274 |
Temporary equity, shares issued | 2,538,274 | 2,538,274 |
Temporary equity, shares outstanding | 2,538,274 | 2,538,274 |
Redeemable convertible preferred stock, aggregate liquidation preference | $ 31,500 | $ 31,500 |
Series 2 Growth | Gelesis | ||
Redeemable convertible preferred stock, shares authorized | 2,370,803 | 2,370,803 |
Redeemable convertible preferred stock, shares designated | 2,370,803 | 2,370,803 |
Temporary equity, shares issued | 2,370,803 | 2,370,803 |
Temporary equity, shares outstanding | 2,370,803 | 2,370,803 |
Redeemable convertible preferred stock, aggregate liquidation preference | $ 30,370 | $ 30,370 |
Series 3 Growth | Gelesis | ||
Redeemable convertible preferred stock, shares authorized | 6,308,529 | 6,308,529 |
Redeemable convertible preferred stock, shares designated | 6,308,529 | 6,308,529 |
Temporary equity, shares issued | 5,818,895 | 5,818,895 |
Temporary equity, shares outstanding | 5,818,895 | 5,818,895 |
Redeemable convertible preferred stock, aggregate liquidation preference | $ 150,768 | $ 150,768 |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Operating expenses: | ||
Total operating expenses | $ 20,674,209 | |
Loss from operations | (20,674,209) | |
Change in fair value of warrant liabilities | 7,602,367 | |
Provision for income taxes | 0 | |
Net loss | (12,898,082) | |
Gelesis | ||
Revenue: | ||
Total revenue, net | 11,185,000 | $ 21,442,000 |
Operating expenses: | ||
Costs of goods sold, including related party expenses of $447 and $108, respectively | 9,983,000 | 2,414,000 |
Selling, general and administrative, including related party expenses of $494 and $614, respectively | 71,041,000 | 28,870,000 |
Research and development, including related party expenses of $255 and $272, respectively | 12,867,000 | 16,115,000 |
Amortization of intangible assets | 2,267,000 | 2,267,000 |
Total operating expenses | 96,158,000 | 49,666,000 |
Loss from operations | (84,973,000) | (28,224,000) |
Change in the fair value of convertible promissory notes | (128,000) | |
Change in fair value of warrant liabilities | (7,646,000) | (1,466,000) |
Change in fair value of tranche rights liability | 256,000 | |
Interest expense, net | (1,364,000) | (432,000) |
Other income, net | 781,000 | 6,000,000 |
Loss before income taxes | (93,330,000) | (23,866,000) |
Provision for income taxes | 17,000 | 2,039,000 |
Net loss | (93,347,000) | (25,905,000) |
Accretion of Legacy Gelesis senior preferred stock to redemption value | (94,134,000) | (11,372,000) |
Accretion of noncontrolling interest put option to redemption value | (376,000) | (567,000) |
Net loss attributable to common stockholders | $ (187,857,000) | $ (37,844,000) |
Earnings Per Share, Basic | $ (85.22) | $ (17.61) |
Earnings Per Share, Diluted | $ (85.22) | $ (17.61) |
Weighted average common shares outstanding - basic | 2,204,486 | 2,149,182 |
Weighted average common shares outstanding - diluted | 2,204,486 | 2,149,182 |
Gelesis | Product revenue | ||
Revenue: | ||
Total revenue, net | $ 11,185,000 | $ 2,708,000 |
Gelesis | Licensing revenue | ||
Revenue: | ||
Total revenue, net | $ 18,734,000 |
CONSOLIDATED STATEMENTS OF OP_3
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Gelesis | ||
Research and development, including related party expenses | $ 447 | $ 108 |
Selling, General and Administrative Expense | Gelesis | ||
Selling, general and administrative, including related party expenses | 494 | 614 |
Research And Development [Member] | Gelesis | ||
Research and development, including related party expenses | $ 255 | $ 272 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Net income (loss) | $ (12,898,082) | |
Gelesis | ||
Net income (loss) | (93,347,000) | $ (25,905,000) |
Other comprehensive income (loss): | ||
Foreign currency translation adjustment | (719,000) | 828,000 |
Unrealized loss on marketable securities | (1,000) | |
Total other comprehensive (loss) income | (719,000) | 827,000 |
Comprehensive loss | $ (94,066,000) | $ (25,078,000) |
CONSOLIDATED STATEMENTS OF NONC
CONSOLIDATED STATEMENTS OF NONCONTROLLING INTEREST, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' DEFICIT - USD ($) | Common Stock Gelesis | Common Stock | Additional Paid-in Capital Gelesis Cumulative effects of adoption of accounting standards (see Note 2) | Additional Paid-in Capital Gelesis | Additional Paid-in Capital | Accumulated Other Comprehensive (Loss) Income Gelesis | Accumulated Deficit Gelesis Cumulative effects of adoption of accounting standards (see Note 2) | Accumulated Deficit Gelesis | Accumulated Deficit | Gelesis Noncontrolling Interest | Gelesis Series A-1 | Gelesis Series A-2 | Gelesis Series A3 Redeemable Convertible Preferred Stock [Member] | Gelesis Series A4 Redeemable Convertible Preferred Stock [Member] | Gelesis Series A-5 | Gelesis Series Growth | Gelesis Series 2 Growth | Gelesis Series 3 Growth | Gelesis | Total |
Balance at beginning at Dec. 31, 2019 | $ 6,176,000 | $ 3,033,000 | $ 4,463,000 | $ 2,466,000 | $ 24,536,000 | $ 31,500,000 | $ 30,370,000 | $ 51,348,000 | ||||||||||||
Balance at the beginning at Dec. 31, 2019 | $ 1,000 | $ 26,248,000 | $ 111,000 | $ (145,423,000) | $ (119,063,000) | |||||||||||||||
Balance, shares at Dec. 31, 2019 | 2,144,651 | |||||||||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2019 | 1,636,971 | 1,161,254 | 1,492,685 | 1,439,352 | 1,977,114 | 2,538,274 | 2,370,803 | 2,973,270 | ||||||||||||
Issuance of redeemable convertible preferred stock, and extinguishment of tranche rights liability | $ 48,125,000 | |||||||||||||||||||
Accretion of senior preferred stock to redemption value | (11,372,000) | $ 455,000 | $ 1,263,000 | $ 314,000 | $ 9,340,000 | (11,372,000) | ||||||||||||||
Exercise/Issuance of warrants | 4,322,000 | $ 136,000 | 4,322,000 | |||||||||||||||||
Exercise/Issuance of warrants (in shares) | 11,177 | |||||||||||||||||||
Stock based compensation expense | $ 4,808,000 | 4,808,000 | ||||||||||||||||||
Net income (loss) | (25,905,000) | (25,905,000) | ||||||||||||||||||
Foreign currency translation gain | 828,000 | $ 513,000 | $ 828,000 | |||||||||||||||||
Noncontrolling interest, net of issuance costs of $406 | 11,349,000 | |||||||||||||||||||
Exercise of share-based awards (in shares) | 10,839 | 12,000 | 12 | |||||||||||||||||
Accretion of noncontrolling interest put option to redemption value | (567,000) | 567,000 | $ (567,000) | |||||||||||||||||
Unrealized loss on marketable securities | (1,000) | $ (1,000) | ||||||||||||||||||
Balance, shares at Dec. 31, 2020 | 2,155,490 | 5,587,094 | ||||||||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2020 | 1,636,971 | 1,161,254 | 1,492,685 | 1,450,529 | 1,977,114 | 2,538,274 | 2,370,803 | 5,818,895 | 18,446,525 | |||||||||||
Balance at the end at Dec. 31, 2020 | $ 1,000 | $ 23,907,000 | 938,000 | (171,784,000) | $ (40,659,524) | $ (146,938,000) | $ (40,658,834) | |||||||||||||
Balance at ending at Dec. 31, 2020 | 12,429,000 | $ 6,176,000 | $ 3,033,000 | $ 4,463,000 | $ 2,602,000 | $ 24,991,000 | $ 32,763,000 | $ 30,684,000 | $ 108,813,000 | $ 213,525,000 | ||||||||||
Balance at the beginning at Feb. 13, 2020 | $ 0 | 0 | 0 | |||||||||||||||||
Net income (loss) | 0 | (15,294,860) | (15,294,860) | |||||||||||||||||
Balance, shares at Dec. 31, 2020 | 2,155,490 | 5,587,094 | ||||||||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2020 | 1,636,971 | 1,161,254 | 1,492,685 | 1,450,529 | 1,977,114 | 2,538,274 | 2,370,803 | 5,818,895 | 18,446,525 | |||||||||||
Balance at the end at Dec. 31, 2020 | $ 1,000 | 23,907,000 | 938,000 | (171,784,000) | (40,659,524) | $ (146,938,000) | (40,658,834) | |||||||||||||
Balance at ending at Dec. 31, 2020 | 12,429,000 | $ 6,176,000 | $ 3,033,000 | $ 4,463,000 | $ 2,602,000 | $ 24,991,000 | $ 32,763,000 | $ 30,684,000 | $ 108,813,000 | 213,525,000 | ||||||||||
Issuance of redeemable convertible preferred stock, and extinguishment of tranche rights liability (in shares) | 2,845,625 | |||||||||||||||||||
Stock based compensation expense | 1,455,000 | 1,455,000 | ||||||||||||||||||
Net income (loss) | (18,586,000) | (18,586,000) | ||||||||||||||||||
Balance, shares at Mar. 31, 2021 | 5,589,728 | |||||||||||||||||||
Balance at beginning at Dec. 31, 2020 | 12,429,000 | $ 6,176,000 | $ 3,033,000 | $ 4,463,000 | $ 2,602,000 | $ 24,991,000 | $ 32,763,000 | $ 30,684,000 | $ 108,813,000 | 213,525,000 | ||||||||||
Balance at the beginning at Dec. 31, 2020 | $ 1,000 | 23,907,000 | 938,000 | (171,784,000) | (40,659,524) | $ (146,938,000) | (40,658,834) | |||||||||||||
Balance, shares at Dec. 31, 2020 | 2,155,490 | 5,587,094 | ||||||||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2020 | 1,636,971 | 1,161,254 | 1,492,685 | 1,450,529 | 1,977,114 | 2,538,274 | 2,370,803 | 5,818,895 | 18,446,525 | |||||||||||
Net income (loss) | (43,325,000) | |||||||||||||||||||
Foreign currency translation gain | (368,000) | |||||||||||||||||||
Balance, shares at Jun. 30, 2021 | 5,615,192 | |||||||||||||||||||
Balance at beginning at Dec. 31, 2020 | 12,429,000 | $ 6,176,000 | $ 3,033,000 | $ 4,463,000 | $ 2,602,000 | $ 24,991,000 | $ 32,763,000 | $ 30,684,000 | $ 108,813,000 | $ 213,525,000 | ||||||||||
Balance at the beginning at Dec. 31, 2020 | $ 1,000 | 23,907,000 | 938,000 | (171,784,000) | (40,659,524) | $ (146,938,000) | (40,658,834) | |||||||||||||
Balance, shares at Dec. 31, 2020 | 2,155,490 | 5,587,094 | ||||||||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2020 | 1,636,971 | 1,161,254 | 1,492,685 | 1,450,529 | 1,977,114 | 2,538,274 | 2,370,803 | 5,818,895 | 18,446,525 | |||||||||||
Accretion of senior preferred stock to redemption value | (94,134,000) | $ 19,316,000 | $ 24,196,000 | $ 22,517,000 | $ 28,106,000 | $ (94,134,000) | ||||||||||||||
Exercise of stock options | 146,000 | $ 146,000 | ||||||||||||||||||
Exercise of stock options (in shares) | 255,062 | 255,062 | ||||||||||||||||||
Exercise/Issuance of warrants | $ 937,000 | $ 2,997,000 | ||||||||||||||||||
Exercise/Issuance of warrants (in shares) | 52,222,000 | 238,189,000 | ||||||||||||||||||
Stock based compensation expense | 5,532,000 | $ 5,532,000 | ||||||||||||||||||
Net income (loss) | (93,347,000) | (12,898,082) | (93,347,000) | (12,898,082) | ||||||||||||||||
Foreign currency translation gain | (719,000) | (950,000) | (719,000) | |||||||||||||||||
Accretion of noncontrolling interest put option to redemption value | (376,000) | 376,000 | (376,000) | |||||||||||||||||
Balance, shares at Dec. 31, 2021 | 2,410,552 | 6,248,192 | ||||||||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2021 | 1,689,193 | 1,161,254 | 1,730,874 | 1,450,529 | 1,977,114 | 2,538,274 | 2,370,803 | 5,818,895 | ||||||||||||
Balance at the end at Dec. 31, 2021 | $ 1,000 | $ (111,000) | (64,549,000) | 219,000 | $ 111,000 | (265,507,000) | (53,524,159) | (329,836,000) | (329,836,000) | |||||||||||
Balance at ending at Dec. 31, 2021 | 11,855,000 | $ 7,113,000 | $ 3,033,000 | $ 7,460,000 | $ 2,602,000 | $ 44,307,000 | $ 56,959,000 | $ 53,201,000 | $ 136,919,000 | |||||||||||
Balance, shares at Mar. 31, 2021 | 5,589,728 | |||||||||||||||||||
Stock based compensation expense | 1,639,000 | 1,639,000 | ||||||||||||||||||
Net income (loss) | (24,739,000) | (24,739,000) | ||||||||||||||||||
Foreign currency translation gain | 43,000 | |||||||||||||||||||
Balance, shares at Jun. 30, 2021 | 5,615,192 | |||||||||||||||||||
Balance, shares at Dec. 31, 2021 | 2,410,552 | 6,248,192 | ||||||||||||||||||
Stock based compensation expense | 13,989,000 | 13,989,000 | ||||||||||||||||||
Net income (loss) | (5,703,000) | (5,703,000) | ||||||||||||||||||
Balance, shares at Mar. 31, 2022 | 72,390,413 | |||||||||||||||||||
Balance at beginning at Dec. 31, 2021 | $ 11,855,000 | $ 7,113,000 | $ 3,033,000 | $ 7,460,000 | $ 2,602,000 | $ 44,307,000 | $ 56,959,000 | $ 53,201,000 | $ 136,919,000 | |||||||||||
Balance at the beginning at Dec. 31, 2021 | $ 1,000 | $ (111,000) | $ (64,549,000) | $ 219,000 | $ 111,000 | $ (265,507,000) | (53,524,159) | $ (329,836,000) | $ (329,836,000) | |||||||||||
Balance, shares at Dec. 31, 2021 | 2,410,552 | 6,248,192 | ||||||||||||||||||
Temporary Equity Balance, shares at Dec. 31, 2021 | 1,689,193 | 1,161,254 | 1,730,874 | 1,450,529 | 1,977,114 | 2,538,274 | 2,370,803 | 5,818,895 | ||||||||||||
Exercise of stock options (in shares) | 162,064 | |||||||||||||||||||
Net income (loss) | $ (18,216,000) | |||||||||||||||||||
Foreign currency translation gain | (564,000) | |||||||||||||||||||
Balance, shares at Jun. 30, 2022 | 72,552,477 | |||||||||||||||||||
Balance at the end at Jun. 30, 2022 | 5,098,000 | |||||||||||||||||||
Balance, shares at Mar. 31, 2022 | 72,390,413 | |||||||||||||||||||
Stock based compensation expense | $ 7,976,000 | 7,976,000 | ||||||||||||||||||
Net income (loss) | $ (12,513,000) | (12,513,000) | ||||||||||||||||||
Foreign currency translation gain | (426,000) | |||||||||||||||||||
Balance, shares at Jun. 30, 2022 | 72,552,477 | |||||||||||||||||||
Balance at the end at Jun. 30, 2022 | $ 5,098,000 |
CONSOLIDATED STATEMENTS OF NO_2
CONSOLIDATED STATEMENTS OF NONCONTROLLING INTEREST, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' DEFICIT (Parenthetical) | 12 Months Ended |
Dec. 31, 2020 USD ($) | |
Gelesis | |
Stock issuance costs | $ 406,000 |
Fair Value Adjustment Of Warrants | 1,466,000 |
Series 3 Growth | Gelesis | |
Stock issuance costs | 329,000 |
Fair Value Adjustment Of Warrants | $ 744,000 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | ||||
Net loss | $ (18,216,000) | $ (43,325,000) | $ 12,898,082 | |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Amortization of intangible assets | 1,133,000 | 1,133,000 | ||
Reduction in carrying amount of right-of-use assets | 265,000 | 150,000 | ||
Depreciation | 1,440,000 | 358,000 | ||
Stock-based compensation | 21,965,000 | 3,094,000 | ||
Unrealized loss on foreign currency transactions | 672,000 | (28,000) | ||
Accretion on marketable securities | (1,000) | |||
Change in fair value of warrant liabilities | (6,084,000) | 7,051,000 | (7,602,367) | |
Change in the fair value of convertible promissory notes | 156,000 | |||
Change in fair value of One S.r.l. call option | 865,000 | 554,000 | ||
Changes in operating assets and liabilities: | ||||
Account receivables | (1,473,000) | 640,000 | ||
Grants receivable | (1,078,000) | (675,000) | ||
Prepaid expenses and other current assets | 5,048,000 | (7,685,000) | ||
Inventories | (5,258,000) | (156,000) | ||
Other assets | (536,000) | (3,281,000) | ||
Accrued expenses and other current liabilities | 571,000 | 8,211,000 | ||
Operating lease liabilities | (263,000) | (144,000) | ||
Deferred income | 2,300,000 | 7,048,000 | ||
Other long-term liabilities | (81,000) | (5,975,000) | ||
Net cash used in operating activities | (39,772,000) | (35,369,000) | (446,644) | |
Cash flows from investing activities: | ||||
Purchases of property and equipment | (5,067,000) | (10,057,000) | ||
Net cash (used in) provided by investing activities | (5,067,000) | 13,943,000 | 176,006 | |
Cash flows from financing activities: | ||||
Principal repayment of notes payable | (1,119,000) | (226,000) | ||
Proceeds from the exercise of warrants | 4,000 | 9,000 | ||
Proceeds from issuance of promissory notes (net of issuance costs of $207 and $751, respectively) | 4,540,000 | |||
Proceeds from exercise of share-based awards | 110,000 | 10,000 | ||
Net cash provided by financing activities | 42,189,000 | 4,333,000 | ||
Effect of exchange rates on cash | (406,000) | (680,000) | ||
Net decrease in cash | (3,056,000) | (17,773,000) | (270,638) | |
Cash and cash equivalents at beginning of year | 28,397,000 | 48,144,000 | 48,144,000 | |
Cash and cash equivalents at end of period | 25,341,000 | 30,371,000 | 28,397,000 | $ 48,144,000 |
Noncash investing and financing activities: | ||||
Purchases of property and equipment included in accounts payable and accrued expense | 1,027,000 | 1,217,000 | ||
Supplemental cash flow information: | ||||
Interest paid on notes payable | 181,000 | 158,000 | ||
Gelesis | ||||
Cash flows from operating activities: | ||||
Net loss | (93,347,000) | (25,905,000) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Amortization of intangible assets | 2,267,000 | 2,267,000 | ||
Reduction in carrying amount of right-of-use assets | 449,000 | 375,000 | ||
Depreciation | 1,524,000 | 512,000 | ||
Stock-based compensation | 5,532,000 | 4,808,000 | ||
Unrealized loss on foreign currency transactions | (37,000) | (589,000) | ||
Noncash interest expense | 173,000 | |||
Accretion on marketable securities | (1,000) | (6,000) | ||
Amortization/accretion on long-term assets and liabilities, net | (4,000) | |||
Change in fair value of warrant liabilities | 7,646,000 | 1,466,000 | ||
Change in the fair value of convertible promissory notes | 128,000 | |||
Change in fair value of One S.r.l. call option | 1,024,000 | |||
Gain on extinguishment of debt | (297,000) | |||
Gain on extinguishment of preferred stock warrant | (157,000) | |||
Change in fair value of trance rights liability | (256,000) | |||
Deferred tax expense on intangible asset (see Note 11) | 1,810,000 | |||
Changes in operating assets and liabilities: | ||||
Account receivables | 70,000 | (729,000) | ||
Grants receivable | (1,723,000) | (6,779,000) | ||
Prepaid expenses and other current assets | (8,029,000) | (3,281,000) | ||
Inventories | (8,645,000) | (3,928,000) | ||
Other assets | 107,000 | (3,583,000) | ||
Accounts payable | 2,604,000 | 4,085,000 | ||
Accrued expenses and other current liabilities | 8,709,000 | 151,000 | ||
Operating lease liabilities | (440,000) | (358,000) | ||
Deferred income | 33,140,000 | 8,242,000 | ||
Other long-term liabilities | (6,442,000) | 165,000 | ||
Net cash used in operating activities | (55,291,000) | (21,991,000) | ||
Cash flows from investing activities: | ||||
Purchases of property and equipment | (19,917,000) | (32,212,000) | ||
Maturities (purchases) of marketable securities | 24,000,000 | (23,993,000) | ||
Net cash (used in) provided by investing activities | 4,083,000 | (56,205,000) | ||
Cash flows from financing activities: | ||||
Principal repayment of notes payable | (302,000) | (192,000) | ||
Proceeds from the exercise of warrants | 10,000 | |||
Proceeds from the issuance of convertible promissory notes | 27,000,000 | |||
Proceeds from issuance of promissory notes (net of issuance costs of $207 and $751, respectively) | 5,679,000 | 28,939,000 | ||
Proceeds from issuance of redeemable convertible preferred stock (net of issuance costs of $0 and $329, respectively) | 48,815,000 | |||
Proceeds from exercise of share-based awards | 146,000 | 12,000 | ||
Proceeds from issuance of noncontrolling interest | 11,349,000 | |||
Net cash provided by financing activities | 32,533,000 | 88,923,000 | ||
Effect of exchange rates on cash | (1,072,000) | 1,643,000 | ||
Net decrease in cash | (19,747,000) | 12,370,000 | ||
Cash and cash equivalents at beginning of year | $ 28,397,000 | $ 48,144,000 | 48,144,000 | 35,774,000 |
Cash and cash equivalents at end of period | 28,397,000 | 48,144,000 | ||
Noncash investing and financing activities: | ||||
Purchases of property and equipment included in accounts payable and accrued expense | 1,712,000 | 1,818,000 | ||
Deferred financing costs included in accounts payable and accrued expense | 773,000 | |||
Supplemental cash flow information: | ||||
Lease liabilities arising from obtaining right-of-use assets | 305,000 | |||
Interest paid on notes payable | $ 1,578,000 | $ 274,000 |
CONSOLIDATED STATEMENTS OF CA_3
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Gelesis | ||
Payments of issuance costs for issuance of promissory notes | $ 207,000 | $ 751,000 |
Payments of issuance costs for issuance of redeemable convertible preferred stock | $ 0 | $ 329,000 |
Nature of the Business and Ba_2
Nature of the Business and Basis of Presentation | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
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 commercial stage biotherapeutics company incorporated under the laws of the State of Delaware. The Company aims to transform weight management through proprietary biomimetic 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 bridge note financings, and government grants. The Company currently manufactures and markets its first product, Plenity® (the “ 2 2 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 (See Note 3). On January 14, 2022, Gelesis Holdings’ common stock and public warrants began trading on the New York Stock Exchange under the symbols “GLS” and “GLS.W”, respectively. 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 will 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 will be 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 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. | |
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 commercial stage biotherapeutics company incorporated under the laws of the State of Delaware. The Company aims to transform weight management through proprietary biomimetic 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 bridge note financings, and government grants. The Company currently manufactures and markets its first product, Plenity® (the “ 2 2 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 (See Note 3). On January 14, 2022, Gelesis Holdings’ common stock and public warrants began trading on the New York Stock Exchange under the symbols “GLS” and “GLS.W”, respectively. 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 will 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 will be 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 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. | |
Gelesis | ||
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, Inc., or the Company, is a commercial stage biotherapeutics company incorporated in 2006 under the laws of the State of Delaware. The Company aims to transform weight management through proprietary biomimetic 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 bridge note financings, and government grants. The Company currently manufactures and markets its first product, Plenity®, which is based on a proprietary hydrogel technology. Plenity®, received de novo clearance from the FDA on April 12, 2019 as a Class II medical device to aid in weight management in adults with excess weight or obesity, Body Mass Index (BMI) of 25 to 40 kg/m 2 , when used in conjunction with diet and exercise. In June 2019, the Company received approval to market Plenity in Europe through a Conformité Européenne (CE) mark for Plenity as a class III medical device indicated for weight loss in overweight and obese adults with a Body Mass Index (BMI) of 25-40 kg/m 2 , when used in conjunction with diet and exercise. Plenity, which is available by prescription in the United States, became available for first commercial sale in May 2020 to a limited number of consumers. In October 2020 availability was increased to test commercial interest and consumer experience. Activities associated with a full commercial launch in the United States began in late 2021. On July 19, 2021, the Company entered into a business combination agreement with Capstar Special Purpose Acquisition Corp. (“CPSR”), a special purpose acquisition company. On January 13, 2022, CPSR, a Delaware corporation and the predecessor company consummated the previously announced business combination, pursuant to the terms of the business combination Agreement, dated as of July 19, 2021 (as amended on November 8, 2021 and December 30, 2021), by and among CPSR, CPSR Gelesis Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of CPSR (“Merger Sub”), and Gelesis, Inc.(together with its consolidated subsidiaries, “Legacy Gelesis”). 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 financing and the sale of the backstop purchase shares, generated approximately $105 million in gross proceeds. On January 14, 2022, Gelesis Holdings’ securities began trading on the New York Stock Exchange under the symbols “GLS” and “GLS.W”. 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 a majority of the senior management of Gelesis Holdings. Accordingly, for accounting purposes, the financial statements of Gelesis Holdings will 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 CPRS will be stated at historical costs, with no goodwill or other intangible assets recorded. Going Concern The 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 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 in recent years primarily from the issuance of redeemable convertible preferred stock, promissory notes, government grants and collaborations and licensing arrangements. The Company expects such operating losses and negative cash flows from operations will continue in 2022. The Company expects its cash on hand as of the date of the consolidated financial statements and gross proceeds of $105 million from the business combination, together with the PIPE financing and the sale of the backstop purchase shares, will only be sufficient to meet the Company’s obligations into the first quarter of 2023, prior to considerations for any additional funding, and not at least twelve months beyond the date of issuance of the consolidated financial statements. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. 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 public or private equity offerings, 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 COVID19 pandemic on the Company’s supply chain and results of operations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations. | |
Nature of the Business and Basis of Presentation | 1. Nature of the Business and Basis of Presentation Nature of Business Gelesis, Inc., or the Company, is a commercial stage biotherapeutics company incorporated in 2006 under the laws of the State of Delaware. The Company aims to transform weight management through proprietary biomimetic 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 bridge note financings, and government grants. The Company currently manufactures and markets its first product, Plenity®, which is based on a proprietary hydrogel technology. Plenity®, received de novo clearance from the FDA on April 12, 2019 as a Class II medical device to aid in weight management in adults with excess weight or obesity, Body Mass Index (BMI) of 25 to 40 kg/m 2 , when used in conjunction with diet and exercise. In June 2019, the Company received approval to market Plenity in Europe through a Conformité Européenne (CE) mark for Plenity as a class III medical device indicated for weight loss in overweight and obese adults with a Body Mass Index (BMI) of 25-40 kg/m 2 , when used in conjunction with diet and exercise. Plenity, which is available by prescription in the United States, became available for first commercial sale in May 2020 to a limited number of consumers. In October 2020 availability was increased to test commercial interest and consumer experience. Activities associated with a full commercial launch in the United States began in late 2021. On July 19, 2021, the Company entered into a business combination agreement with Capstar Special Purpose Acquisition Corp. (“CPSR”), a special purpose acquisition company. On January 13, 2022, CPSR, a Delaware corporation and the predecessor company consummated the previously announced business combination, pursuant to the terms of the business combination Agreement, dated as of July 19, 2021 (as amended on November 8, 2021 and December 30, 2021), by and among CPSR, CPSR Gelesis Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of CPSR (“Merger Sub”), and Gelesis, Inc.(together with its consolidated subsidiaries, “Legacy Gelesis”). 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 financing and the sale of the backstop purchase shares, generated approximately $105 million in gross proceeds. On January 14, 2022, Gelesis Holdings’ securities began trading on the New York Stock Exchange under the symbols “GLS” and “GLS.W”. 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 a majority of the senior management of Gelesis Holdings. Accordingly, for accounting purposes, the financial statements of Gelesis Holdings will 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 CPRS will be stated at historical costs, with no goodwill or other intangible assets recorded. Going Concern The 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 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 in recent years primarily from the issuance of redeemable convertible preferred stock, promissory notes, government grants and collaborations and licensing arrangements. The Company expects such operating losses and negative cash flows from operations will continue in 2022. The Company expects its cash on hand as of the date of the consolidated financial statements and gross proceeds of $105 million from the business combination, together with the PIPE financing and the sale of the backstop purchase shares, will only be sufficient to meet the Company’s obligations into the first quarter of 2023, prior to considerations for any additional funding, and not at least twelve months beyond the date of issuance of the consolidated financial statements. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. 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 public or private equity offerings, 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 COVID19 pandemic on the Company’s supply chain and results of operations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations. |
Summary of Significant Accou_11
Summary of Significant Accounting Policies | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. Summary of Significant Accounting Policies Basis of Presentation The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). The Company consolidates those entities where it has a direct and indirect controlling financial interest based on either a variable interest model or voting interest model. 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. The noncontrolling interest attributable to the Company’s VIE is presented as a separate component from stockholders’ equity (deficit) in the condensed consolidated balance sheets and as a noncontrolling interest in the condensed consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholders’ equity. All intercompany balances and transactions have been eliminated in consolidation. Under the variable interest model, a controlling financial interest is determined based on which entity, if any, has (i) the power to direct the activities of the VIE that most significantly impacts the VIE’s economic performance and (ii) the obligations to absorb losses that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. The consolidation status of a VIE may change as a result of such reassessments. Changes in consolidation status are applied prospectively in accordance with U.S. GAAP. 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. Fair Value of Financial Instruments The guidance in FASB ASC 820, Fair Value Measurements and Disclosures 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, and call option liability 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: 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: One S.r.l. Call Option: 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 Effective January 1, 2020, the Company accounts for all stock-based compensation awards granted to employees and non-employees in accordance with ASC 718, Compensation – Stock Compensation ● 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. Since the adoption of ASU 2018-07 on January 1, 2020, 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. | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation. Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s consolidated financial statement with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. One of the more significant accounting estimates included in these consolidated financial statements is the determination of the fair value of the warrant liabilities. Such estimates may be subject to change as more current information becomes available and, accordingly, the actual results could differ significantly from those estimates. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2021 and 2020. Marketable Securities Held in Trust Account At December 31, 2021 and 2020, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the consolidated balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments held in Trust Account are included in interest earned on marketable securities held in Trust Account in the accompanying consolidated statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. Offering Costs The Company complies with the requirements of the ASC 340-10-S99-1. Offering costs consisted of legal, accounting, underwriting fees and other costs incurred through the Initial Public Offering that were directly related to the Initial Public Offering. The Company incurred offering costs amounting to $15,851,828 as a result of the Initial Public Offering, consisting of $5,520,000 of underwriting commissions, $9,660,000 of deferred underwriting commissions, and $671,828 of other offering costs. The offering costs were charged to temporary equity and additional paid-in capital upon the completion of the Initial Public Offering. Immediately thereafter, temporary equity was remeasured and an adjustment was recognized through additional paid in capital and accumulated deficit to adjust temporary equity to the redemption value. Warrant Liabilities The Company accounts for the Public Warrants (as defined in Note 2) and Private Placement Warrants (together with the Public Warrants, the “Warrants”) in accordance with the guidance contained in ASC 815-40, under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrants as liabilities at their fair value and adjusts the Warrants to fair value in respect of each reporting period. This liability is subject to re-measurement at each balance sheet date until the Warrants are exercised, and any change in fair value is recognized in the consolidated statements of operations. The Private Placement Warrants and the Public Warrants for periods where no observable traded price was available are valued using a Monte Carlo simulation. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrants’ quoted market price was used as the fair value as of each relevant date. Class A Common Stock Subject to Possible Redemption The Company accounts for its shares of Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s consolidated balance sheets. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable common stock are affected by charges against additional paid-in capital and accumulated deficit. At December 31, 2021 and 2020, the ordinary shares reflected in the consolidated balance sheets are reconciled in the following table: Gross proceeds $ 276,000,000 Less: Proceeds allocated to Public Warrants (11,454,000) Class A common stock issuance costs (15,179,927) Plus: Remeasurement of carrying value to redemption value 26,667,374 Common stock subject to possible redemption, 12/31/20 276,033,447 Remeasurement of carrying value to redemption value (33,447) Common stock subject to possible redemption, 12/31/21 $ 276,000,000 Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the consolidated financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The effective tax rates differ from the statutory tax rate for the periods presented primarily due to the change in warrant valuation and the valuation allowance recorded on the Company’s net operating losses. ASC 740 prescribes a recognition threshold and a measurement attribute for the consolidated financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. Net Loss Per Common Share The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. The Company has two classes of common stock, which are referred to as Class A common stock and Class B common stock. Income and losses are shared pro rata between the two classes of common stock. Net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. Remeasurement associated with the redeemable shares of Class A common stock is excluded from loss per common share as the redemption value approximates fair value. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 21,320,000 shares in the calculation of diluted loss per share, since the exercise of the warrants is contingent upon the occurrence of future events. As of December 31, 2021 and 2020, the Company did not have any other dilutive securities or other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company. As a result, diluted net loss per common share is the same as basic net loss per common share for the periods presented. The following table reflects the calculation of basic and diluted net loss per common share (in dollars, except per share amounts): For the Period from February 14, 2020 (Inception) Through Year Ended December 31, December 31, 2021 2020 Class A Class B Class A Class B Basic and diluted net loss per common share Numerator: Allocation of net loss, as adjusted $ (10,318,466) $ (2,579,616) $ (10,719,238) $ (4,575,622) Denominator: Basic and diluted weighted average stock outstanding 27,600,000 6,900,000 15,218,692 6,496,262 Basic and diluted net loss per common share $ (0.37) $ (0.37) $ (0.70) $ (0.70) Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Corporation coverage limit of $250,000. The Company has not experienced losses on this account. Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying consolidated balance sheets, primarily due to their short-term nature. The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. Recent Accounting Standards In August 2020, the FASB issued ASU No. 2020-06, “Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s consolidated financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s consolidated financial statements. |
Gelesis | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. Summary of Significant Accounting Policies Basis of Presentation The Company’s consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). The Company consolidates those entities where it has a direct and indirect controlling financial interest based on either a variable interest model or voting interest model. The Company’s 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. The noncontrolling interest attributable to the Company’s VIE is presented as a separate component from stockholders’ deficit in the consolidated balance sheets and as a noncontrolling interest in the consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholders’ deficit. All intercompany balances and transactions have been eliminated in consolidation. Under the variable interest model, a controlling financial interest is determined based on which entity, if any, has (i) the power to direct the activities of the VIE that most significantly impacts the VIE’s economic performance and (ii) the obligations to absorb losses that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. The consolidation status of a VIE may change as a result of such reassessments. Changes in consolidation status are applied prospectively in accordance with U.S. GAAP. Use of Estimates The preparation of 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 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 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 financial statements were filed with the Security and Exchange Commission (“SEC”) or were available to be issued. Fair Value of Financial Instruments The guidance in FASB ASC 820, Fair Value Measurements and Disclosures 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 tranche rights liability, preferred stock warrants, and call option liability (see Notes 3 and 11) 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 below (see Note 3). Preferred Stock Warrant Liability: Tranche Rights Liability: Distinguishing Liabilities from Equity Noncontrolling Interests: investment in the former subsidiary will be initially measured at fair value and the difference between the carrying value and fair value of the retained interest will be recorded as a gain or loss. Cash Equivalents The Company considers all short-term, highly liquid investments with original maturities of 90 days or less at acquisition date to be cash equivalents. Cash equivalents, which consist of money market accounts purchased with original maturities of less than 90 days from the date of purchase, are stated at fair value. Marketable Securities The Companies classifies all investment securities as available-for-sale, as the sale of such securities may be required prior to maturity. These investment securities are carried at fair value, with unrealized gains and losses reported as accumulated other comprehensive loss until realized. The cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization and accretion, as well as interest, are included in interest income. Realized gains and losses from sale of available-for-sale securities, if any, are determined on a specific identification basic and are also included in interest income. The Company reviews all available-for-sale securities at each period end to determine if they remain available-for-sale based on then current intent and ability to sell the security if it is required to do so. Marketable securities are subject to a periodic impairment review. The Company may recognize an impairment charge when a decline in the fair value of investments below the cost basis is determined to be other-than-temporary. The Company did not have any marketable securities deemed to be impaired at December 31, 2020 and did not have any marketable securities at December 31, 2021. Accounts Receivable The Company extends credit to customers based upon contractual terms or its evaluation of the customer’s financial condition. Customer accounts receivable are stated at amounts due net of applicable discounts and other contractual adjustments as well as an allowance for expected credit losses. The Company assesses the need for an allowance for expected credit losses based upon currently expected credit losses (“CECL”) by considering a number of factors, including the length of time trade accounts receivable are past due, the customer’s ability to pay its obligation and the condition of the general economy and the industry as a whole. The Company will write off accounts receivable when the Company determines that they are uncollectible. The Company has not historically experienced any collection issues or significant credit losses. Based on historical receipts and collections history, management has determined that an allowance for expected credit losses is not necessary at December 31, 2021 or 2020. Government Grants The Company recognizes grants from governmental agencies in other income on the consolidated statements of operations, gross of the expenditures that were related to the underlying project being co-funded by the grant, when there is reasonable assurance that the Company will comply with the conditions attached to the grant arrangement and payments under the grant will be received. The Company evaluates the conditions of each individual grant as of each reporting period to ensure that the Company has reached reasonable assurance of meeting the conditions of each grant arrangement and that it is expected that the grant payment will be received as a result of meeting the necessary conditions. The Company has been awarded grants from government agencies in Italy for certain capital expenditures and expenses incurred for research and development work performed under specified programs conducted in Italy. The Company submits qualifying expenses and capital purchases for reimbursement under each specified program, which occurs after the Company has made the capital purchases and/or incurred the research and development costs. The Company records a grant receivable upon incurring such expenses, as approval and reimbursement are considered to be perfunctory once the qualifying program has been approved. Government grants are recognized in the consolidated statements of operations on a systematic basis over the periods in which the Company recognizes the related costs for which the government grant is intended to compensate. Specifically, grant income related to research and development costs is recognized as such expenses are incurred. Research and development costs that were incurred prior to the approval of a qualifying program are recognized as grant income immediately upon approval of the program by the grantor. Grant income related to qualifying capital purchases is recognized in proportion to the depreciation expense incurred on the underlying assets. Deferred income related to capital purchases for which grant income will be recognized beyond twelve months from the balance sheet date is classified as long-term deferred income on the consolidated balance sheets and amortized to other income, net, over the same life of the related asset. Inventory The Company manufactures its own super-absorbent hydrogels used in Plenity® and other product candidates out of its own manufacturing facilities located in Italy. The packaging of the hydrogels is currently outsourced to contract packaging organizations for commercial and research and development purposes. Inventories comprise raw materials, including raw materials for packaging components, work-in-process, and finished goods, which are goods that are available for sale. The Company states inventory at the lower of cost or net realizable value with the cost based on the first-in, first-out method. If the Company identifies excess, obsolete or unsalable items, it writes down its inventory to its net realizable value in the period in which the impairment is identified. These adjustments are recorded based upon various factors related to the product, including the level of product manufactured by the Company, the level of product in the distribution channel, current and projected demand, the expected shelf-life of the product and firm inventory purchase commitments. Significant shipping and handling costs incurred for inventory purchases are included in inventory and costs incurred for product shipments are recorded in cost of goods sold as incurred. Property and Equipment Property and equipment are stated at cost, less accumulated depreciation. Expenditures for maintenance and repairs are charged to operations as incurred whereas major betterments are capitalized as additions to property and equipment. Depreciation and amortization begin at the time the asset is placed in service, and are recorded using the straight-line method over the estimated useful lives, as follows: Asset Category Useful Lives Computer equipment and software 1 – 3 years Laboratory and manufacturing equipment 2.5 – 8.3 years Leasehold improvements 5 – 10 years, or the remaining term of lease, if shorter Buildings and land improvements 18 – 20 years Land Not depreciated Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. When such events occur, the Company compares the carrying amounts of the assets to the undiscounted expected future cash flows the assets are expected to generate and recognizes an impairment loss equal to the excess of the carrying value over the fair value of the related asset. For the years ended December 31, 2021 and 2020, there were no indicators of impairment. Intangible Assets Intangible assets with estimable useful lives, or definite-lived intangibles, are carried at cost and are amortized on a straight-line basis over their estimated useful lives and reviewed for impairment upon certain triggering events. We routinely review the remaining estimated useful lives of definite-lived intangible assets. If we reduce the estimated useful life assumption, the remaining unamortized balance is amortized over the revised estimated useful life. Redeemable Convertible Preferred Stock The Company has classified redeemable convertible preferred stock as temporary equity in the consolidated balance sheets due to certain change in control clauses that are outside of the Company’s control, including liquidation, sale, or transfer of control of the Company, as holders of the redeemable convertible preferred stock could cause redemption of the shares in these situations. The Company accretes the carrying values of the classes of redeemable convertible preferred stock that are mandatorily redeemable to the redemption values. The Company does not accrete the carrying values of the classes of redeemable convertible preferred stock that are not mandatorily redeemable to the redemption values since a liquidation event, sale, or transfer is not considered probable. Subsequent adjustments of the carrying values to the ultimate redemption values will be made only if and when it becomes probable that such a liquidation event will occur. Leases The Company determines if an arrangement is a lease at contract inception under ASC 842 — Leases The Company has elected to apply the practical expedient to account for lease and non-lease components as a single lease component for new and modified leases commencing after adoption election. The Company has also elected not to recognize leases with an initial term of 12 months or less on the consolidated balance sheets, instead, those lease payments are recognized in the consolidated statements of operations on a straight-line basis over the lease term. 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 adjust the corresponding product warranty reserves and liabilities at least quarterly and at the end of each reporting period. License and Collaboration Revenues The Company recognizes revenue from product sales and collaboration arrangements in accordance with ASC 606, Revenue from Contracts with Customers Performance obligations are promised goods or services in a contract to transfer a distinct good or service to the customer and are considered distinct when (i) the customer can benefit from the good or service on its own or together with other readily available resources and (ii) the promised good or service is separately identifiable from other promises in the contract. In assessing whether promised goods or services are distinct, the Company considers factors such as the stage of development of the underlying intellectual property, the capabilities of the customer to develop the intellectual property on its own or whether the required expertise is readily available, and whether the goods or services are integral or dependent to other goods or services in the contract. For performance obligations which consist of the Company’s materials, shipping and distribution activities occur prior to the transfer of control of the Company’s materials and are considered activities to fulfill the Company’s promise to deliver goods to the customers. The Company has entered and anticipates to enter future license, collaboration and/or distribution agreements, which are within the scope of ASC 606, to manufacture and commercialize product(s). The terms of these agreements typically contain multiple promises or obligations, which may include: (i) manufacturing and supply of covered products, and (ii) regulatory support activities to be provided to the collaboration partner relating to the covered product(s). Payments to the Company under these agreements may include payments based upon the achievement of certain milestones and royalties on any resulting net product sales. The Company first evaluates collaboration arrangements to determine whether the arrangement (or part of the arrangement) represents a collaborative arrangement pursuant to ASC Topic 808, Collaborative Arrangements, Amounts received prior to revenue recognition are recorded as deferred income. Amounts expected to be recognized as revenue within the twelve months following the balance sheet date are classified as current portion of deferred income in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the twelve months following the balance sheet date are classified as deferred income, net of current portion. Amounts recognized as revenue, but not yet received or invoiced are generally recognized as contract assets. Cost of goods sold Cost of goods sold includes the cost of manufacturing our proprietary superabsorbent hydrogels for Plenity for which revenue was recognized during the period, as well as the associated costs for encapsulation, packaging, shipment, supply management and quality assurance. Expenses from royalty agreements on net product sales are also recognized as a component of cost of goods sold during the period in which the associated revenues are recognized. A portion of depreciation with respect to property and equipment directly utilized in manufacturing Plenity units is recognized as a component of cost of goods sold over the depreciable life of the asset. Selling, General and Administrative Costs Selling, general and administrative costs are expensed as incurred. Selling, general and administrative costs include sales and marketing costs incurred as a result of the commercialization of the Company’s products, payroll and personnel expense, stock-based compensation expense, and costs of programs and infrastructure necessary for the general conduct of the Company’s business. Research and Development Costs Research and development costs are expensed as incurred. Research and development costs include payroll and personnel expense, stock-based compensation expense, consulting costs, external contract research and development expenses, as well as depreciation and utilities. Prepaid research and development costs are deferred and amortized over the service period, as the services are provided. Stock-Based Compensation Effective January 1, 2020, the Company accounts for all stock-based compensation awards granted to employees and non-employees in accordance with ASC 718, Compensation — Stock Compensation ● exercise price: In determining the exercise prices for options granted, the Board of Directors has considered the fair value of the common stock as of each grant date. The fair value of the common stock underlying the stock options has been determined by the Board of Directors at each award grant date based upon the estimated fair value of the Company’s common stock as determined by an independent third-party valuation firm. The specialists at this valuation firm considered a variety of factors including the Company’s financial position and historical financial performance, the status of technological developments within the Company’s products, the composition and ability of the current clinical and management team, an evaluation or benchmark of the Company’s competition, the current business climate in the marketplace, the illiquid nature of the common stock, arm’s length sales of the Company’s capital stock (including Series Preferred), the effect of the rights and preferences of the preferred stockholders, and the prospects of a liquidity event, among others. ● expected volatility: As the Company is 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. Prior to the adoption of Accounting Standards ASU No. 2018-07, Compensation — Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting awards was generally the date the services were completed, resulting in financial reporting period adjustments to stock-based compensation during the vesting terms for changes in the fair value of the awards. Since the adoption of ASU 2018-07 on January 1, 2020, 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 consolidated statements of operations based on the function to which the related services are provided. Forfeitures are recorded as they occur. Income Taxes The consolidated financial statements reflect provisions for federal, state, local and foreign income taxes. Deferred tax assets and liabilities are recognized based on temporary differences between the financial reporting and income tax basis of assets and liabilities using rates anticipated to be in effect when such temporary differences reverse. A change in tax rates is recognized in income in the period of the enactment date. A valuation allowance against net deferred tax assets is required if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company also assesses the probability that the positions taken or expected to be taken in its income tax returns will be sustained by taxing authorities. A “more likely than not” (more than 50%) recognition threshold must be met before a tax benefit can be recognized. Tax positions that are more likely than not to be sustained on examination by the taxing authorities, based on the technical merits of the position, are reflected in the Company’s consolidated financial statements. Tax positions are measured as the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The difference between the benefit recognized for a position and the tax benefit claimed on a tax return is referred to as an unrecognized tax benefit. Potential interest and penalties associated with such uncertain tax positions are recorded as a component of income tax expense. Foreign Currency Translation The financial statements of each of the Company’s subsidiaries with a functional currency other than the U.S. dollar are translated into U.S. dollars using period-end exchange rates for assets and liabilities, historical exchange rates for stockholders’ equity and weighted average exchange rates for operating results. Translation gains and losses are included in accumulated other comprehensive income (loss) in stockholders’ equity. Foreign currency transaction gains and losses are included in other (expense) income, net in the results of operations. Concentrations of Credit Risk and Off -Balance-Sheet Risk The Company has no significant off-balance-sheet risk such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially expose the Company to concentrations of credit risk primarily consist of cash and cash equivalents, investments, accounts receivable and unbilled account receivables. The Company’s cash balances, trade receivables, and grants receivable subject the Company to significant concentrations of credit risk. Periodically, the Company maintains deposits in government insured financial institutions in excess of government insured limits. The Company deposits its cash in financial institutions that it believes have high credit quality and has not experienced any losses on such accounts and does not believe it is exposed to any significant credit risk on cash. The Company’s grants receivable are due from government agencies, which the Company believes to have high credit quality. The Company has a limited number of commercial customers. The Company monitors the creditworthiness of customers to whom it grants credit terms and has not experienced any credit losses. Earnings (Loss) per Share The Company computes basic earnings (loss) per share by dividing income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding. During periods of income, the Company allocates participating securities a proportional share of income determined by dividing total weighted average participating securities by the sum of the total weighted average common shares and participating securities (the “two-class method”). The Company’s restricted stock and various series of preferred stocks participate in dividends declared by the Company and are therefore considered to be participating securities. Participating securities have the effect of diluting both basic and diluted earnings per share during periods of income. During periods of loss, the Company allocates no loss to participating securities because they have no contractual obligation to share in the losses of the Company. The Company computes diluted earnings (loss) per share after giving consideration to the dilutive effect of stock options and warrants that are outstanding during the period, except where such non-participating securities would be anti-dilutive. Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision-making group, in making decisions on how to allocate resources and assess performance. The Company’s chief operating decision maker is the chief executive officer. The Company and the chief operating decision maker view the Company’s operations and manage its business as one operating segment. Geographically, the Company operates out of the U.S. and Italy. The corporate headquarters including the core functions of sales and marketing, medical affairs, research and development and general and administrative are located in the U.S., while substantially all of the Company’s manufacturing facilities and operations physically reside in Italy. Recently Adopted Accounting Pronouncements Credit Losses In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13). The FASB has subsequently issued amendments to ASU 2016-13, which have the same effective and transition date of fiscal years beginning after December 15, 2019 for SEC filers other than smal |
Fair Value Measurements_2_3
Fair Value Measurements | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
FAIR VALUE MEASUREMENTS | 4. Fair Value Measurements Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at June 30, 2022 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Earnout liability (See Note 14) $ 6,190 $ — $ — $ 6,190 Private placement warrant liability (see Note 13) 1,130 — — 1,130 One S.r.l. call option (see Note 11) 3,062 — — 3,062 Total liabilities measured at fair value $ 10,382 $ — $ — $ 10,382 Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at December 31, 2021 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Convertible promissory notes (see Note 12) $ 27,128 $ — $ — $ 27,128 Legacy Gelesis preferred stock warrants (See Note 13) 15,821 — — 15,821 One S.r.l. call option (see Note 11) 2,416 — — 2,416 Total liabilities measured at fair value $ 45,365 $ — $ — $ 45,365 The following table presents a summary of the changes in the fair value of the Company’s Level 3 financial instruments during the six months ended June 30, 2022: Legacy Gelesis Redeemable Preferred Convertible Stock Promissory Warrants One S.r.l. Call Earnout Private Placement Notes Liabilities Option Liability Warrant Liability Balance at December 31, 2021 $ 27,128 $ 15,821 $ 2,416 $ — $ — Assumed upon Business Combination — — — — 8,140 Recognized upon Business Combination — — — 58,871 — Changes in fair value 156 926 865 (52,681) (7,010) Foreign currency translation (gain)/loss — — (219) — — Conversion and exchange upon Business Combination — (16,747) — — — Settlement (27,284) — — — — Balance at June 30, 2022 $ — $ — $ 3,062 $ 6,190 $ 1,130 There were no transfers out level | NOTE 10. FAIR VALUE MEASUREMENTS The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at December 31, 2021 and 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: Description Level December 31, 2021 December 31, 2020 Assets Cash and marketable securities held in Trust Account 1 $ 276,207,207 $ 276,209,453 Liabilities: Warrant Liability — Public Warrants 1 $ 8,964,000 $ 19,458,000 Warrant Liability — Private Placement Warrants 3 $ 13,805,441 $ 10,643,808 The Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities in the accompanying consolidated balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the consolidated statements of operations. The measurement of the Public Warrants as of December 31, 2021 and 2020 is classified as Level 1 due to the use of an observable market quote in an active market. Level 3 financial liabilities consist of the Private Placement Warrant liability for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate. The fair value of the Private Placement Warrants was estimated at December 31, 2021 and 2020 to be $1.84 per warrant and $1.42 per warrant, respectively, using the modified Black-Scholes option pricing model and the following assumptions: December 31, 2021 December 31, 2020 Risk free rate 1.26 % 0.47 % Expected term 5.04 5.76 Dividend yield 0.00 % 0.00 % Expected volatility 24.28 % 19.0 % Exercise price $ 11.50 $ 11.50 Unit Price $ 9.96 $ 10.15 The following table presents the changes in the fair value of Level 3 warrant liabilities: Warrant Private Placement Public Liabilities Fair value as of January 1, 2020 $ $ $ Initial measurement on July 7, 2020 (Initial Public Offering) 6,241,600 11,454,000 17,695,600 Transfer to Level 1 — (11,046,900) (11,046,900) Change in fair value 4,402,208 (407,100) 3,995,108 Fair value as of December 31, 2020 $ 10,643,808 $ — $ 10,643,808 Change in fair value 3,161,633 — 3,161,633 Fair value as of December 31, 2021 $ 13,805,441 — $ 13,805,441 Due to the use of quoted prices in an active market (Level 1) to measure the fair value of the Public Warrants, subsequent to initial measurement, the Company had transfers out of Level 3 totaling approximately $11.1 million during the period from July 7, 2020 through December 31, 2020. There were no transfers in or out of Level 3 from other levels in the fair value hierarchy during the year ended December 31, 2021. |
Gelesis | ||
FAIR VALUE MEASUREMENTS | 3. Fair Value Measurements Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at December 31, 2021 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Convertible promissory notes (see Note 12) $ 27,128 $ — $ — $ 27,128 Preferred stock warrants 15,821 — — 15,821 One Srl call option (see Note 11) 2,416 — — 2,416 Total liabilities measured at fair value $ 45,365 $ — $ — $ 45,365 Assets and liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at December 31, 2020 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Assets: Marketable securities $ 23,998 $ 23,998 $ — $ — Total assets measured at fair value $ 23,998 $ 23,998 $ — $ — Liabilities: Preferred stock warrants $ 12,099 $ — $ — $ 12,099 One Srl call option (see Note 11) 1,545 — — 1,545 Total liabilities measured at fair value $ 13,644 $ — $ — $ 13,644 There were no transfers into or out of level 3 instruments and/or between level 1 and level 2 instruments during the years ended December 31, 2021 and 2020. The fair value of the tranche right liability, preferred stock warrant liability, and call option liability includes inputs not observable in the market and thus represents a Level 3 measurement. The Company estimates the fair value of the underlying stock by estimating the probability of various change of control events occurring and then estimates the present value of the amount the holders would receive upon the change in control. The significant assumption used in the model is the probability of the following scenarios occurring: At December 31, 2021 2020 IPO scenario 2.5 % 75.0 % Market adjusted equity value method 2.5 % 25.0 % Special purpose acquisition company (“SPAC”) scenario 95.0 % 0.0 % Tranche right liability Tranche rights are initially recorded at fair value, are subsequently adjusted for settlement of the tranche rights upon issuance of the tranche shares and are remeasured at each subsequent reporting date. The Company initially measures the fair value of the tranche rights at the issuance date, and subsequently at each reporting date, using a Black-Scholes option pricing model. The significant inputs used in estimating the fair value of tranche rights include the estimated fair value of the underlying stock, expected term of the tranche right, risk free interest rate, and expected volatility. The following represents a summary of the changes to Company’s tranche right liability during the year ended December 31, 2020 (in thousands): Tranche rights liability Balance at December 31, 2019 $ 310 Change in fair value of tranche rights liability immediately prior to tranche settlement in April 2020 (256) Settlement of Series 3 Growth tranche rights liability in April 2020 (54) Balance at December 31, 2020 $ — The change in the fair value of the Tranche Rights is influenced primarily by the price of the underlying Redeemable Convertible Preferred Stock and the remaining term of the Tranche Right. During the year ended December 31, 2020, the Company recognized a loss of $0.3 million in the consolidated statements of operations related to changes in the fair value of tranche rights. The tranche rights liability was settled in April 2020 and there was no outstanding liability at December 31, 2020. Preferred stock warrant liability Preferred stock warrants are recorded at estimated fair value at the date of issuance and are remeasured at each subsequent reporting date. Fair value is determined using a Black-Scholes option pricing model. The significant inputs used in estimating the fair value of warrants include the estimated fair value of the underlying stock, expected term, risk free interest rate, and expected volatility. The Company estimates the fair value of the underlying stock by estimating the probability of various change of control events occurring and then estimates the present value of the amount the holders would receive upon the change in control. The following represents a summary of the changes to Company’s warrant liability for the years ended December 31, 2021 and 2020 (in thousands): Series 3 Series 4 Series A-1 Series A-3 Series A-4 Growth Growth Warrants Warrants Warrants Warrants Options Total Balance at December 31, 2019 485 2,541 7,686 4,631 653 15,996 Issuance of Series 4 Growth option liability — — — — 745 745 Extinguishment of Series 3 Growth warrant — — — (5,973) — (5,973) Exercise of Series A-4 warrants — — (135) — — (135) Change in fair value of warrant liability 96 355 1,071 1,342 (1,398) 1,466 Balance at December 31, 2020 $ 581 $ 2,896 $ 8,622 $ — $ — $ 12,099 Exercise of warrants (937) (2,987) — — — (3,924) Change in fair value of warrant liability 356 91 7,199 — — 7,646 Balance at December 31, 2021 $ — $ — $ 15,821 $ — $ — $ 15,821 Warrants with an expected term of less than one year from the date of the consolidated balance sheets are recorded under current liabilities on the consolidated balance sheets. At December 31, 2021, the Company reported a warrant liability in the amount of $15.8 million under current liabilities. At December 31, 2020, the Company reported a warrant liability in the amount of $0.6 million and $11.5 million under current and noncurrent liabilities, respectively. The following weighted average assumptions were used to determine the fair value of the warrant liability at December 31, 2021: Series A-4 Warrants Expected term 0.1 years Expected volatility 48.0 % Expected dividend yield 0.0 % Risk free interest rate 0.6 % Estimated fair value of the redeemable convertible preferred stock $ 22.36 Exercise price of warrants $ 0.04 The following weighted average assumptions were used to determine the fair value of the warrant liability at December 31, 2020: Series A-1 Series A-3 Series A-4 Warrants Warrants Warrants Expected term 0.3 years 1.5 years 2.6 years Expected volatility 48.0 % 68.0 % 59.0 % Expected dividend yield 0.0 % 0.0 % 0.0 % Risk free interest rate 0.1 % 0.1 % 0.2 % Estimated fair value of the redeemable convertible preferred stock $ 12.24 $ 12.21 $ 12.22 Exercise price of warrants $ 4.44 $ 0.04 $ 0.04 The Company issued equity-classified common stock warrants during the year ended December 31, 2020 (see Note 13). While the fair value of the common stock warrants represents a Level 3 measurement, equity-classified warrants are recorded at their initial fair value and not subsequently remeasured. As such, the common stock warrants and its unobservable inputs are not included in the above tables. One Srl call option liability The One Srl call option liability was recorded at estimated 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 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 for the years ended December 31, 2021 and 2020 (in thousands): Fair value of One Srl call option $ 1,494 Foreign currency translation loss 51 Balance at December 31, 2020 $ 1,545 Change in fair value 1,024 Foreign currency translation gain (153) Balance at December 31, 2021 $ 2,416 Changes in the unobservable inputs noted above would impact the amount of the respective liability. For the respective liability, increases (decreases) in the estimates of the Company’s annual volatility would increase (decrease) the liability and an increase (decrease) in the annual risk-free rate would increase (decrease) the liability. The following weighted average assumptions were used to determine the fair value of the One Srl call option liability at December 31, 2021 and 2020: At December 31, 2021 2020 Expected term 2.0 years 1.8 years Expected volatility 62.0 % 61.0 % Expected dividend yield 0.0 % 0.0 % Risk free interest rate 0.7 % 0.1 % Estimated fair value of ownership interest $ 6,922 $ 6,066 Exercise price of call option $ 6,806 $ 7,358 Convertible promissory notes The convertible promissory notes issued in conjunction with the bridge financing arrangement 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 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. The following assumptions were used to determine the fair value of the convertible promissory notes at December 31, 2021: Convertible Promissory Notes Expected term 0.1 years Discount rate 36.3 % Probability of repayment after close of business combination 95.0 % Probability of holder electing conversion option 5.0 % |
Marketable Securities
Marketable Securities | 12 Months Ended |
Dec. 31, 2021 | |
Gelesis | |
Marketable Securities | 4. Marketable Securities The following table summarizes the marketable securities held at December 31, 2020 (in thousands): Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Fair Value Marketable securities: Commercial paper $ 15,999 $ 1 $ (2) $ 15,998 United States Treasury securities 8,000 — — 8,000 Total marketable securities $ 23,999 $ 1 $ (2) $ 23,998 All marketable securities held at December 31, 2020 reached their respective maturity date during year ended December 31, 2021. No marketable securities remained outstanding at December 31, 2021. |
Product Revenue Reserve and All
Product Revenue Reserve and Allowance (Imported) | 12 Months Ended |
Dec. 31, 2021 | |
Gelesis | |
Product Revenue Reserve and Allowance | 5. 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 end-user patients and healthcare providers. Patients are required to have a prescription in order to purchase the Product in the US. Roman Health Pharmacy LLC In August 2019, the Company entered into a two-year exclusive supply and distribution agreement with Roman Health Pharmacy LLC (“Ro”), giving Ro exclusive distributor rights to sell the Product via telehealth platforms in the United States. Ro submits purchase orders as needed to Cardinal Health, the Company’s third-party logistics distribution agent for commercial sales of the Product, and Cardinal Health ships to Ro. Pursuant to the terms of the 2019 agreement, the Company retained control of the Product until Ro received an end-user purchase order and prepared the Product for shipment to Ro patients, at which time control passes to Ro. The Company began shipping products to Ro in May 2020. The Company recognized revenue based on units shipped by Ro to end-users. In January 2021, the Company and Ro amended and restated its customer agreement. Pursuant to the amended and restated agreement, the Company received $10.0 million of cash as a pre-buy commitment for Product which was recorded to current deferred income in the accompanying consolidated balance sheets. Additionally, the amended and restated agreement ended the consignment arrangement with Ro and the Company no longer retains control of any units shipped to Ro under the amended terms. Henceforth, all products shipped to Ro are immediately recognized as revenue upon the transfer of physical control. In July 2021, the Company and Ro entered into a second amended and restatement agreement, under which the Company received $30.0 million of cash as a second pre-buy commitment for the Product, which was recorded to current deferred income in the accompanying consolidated balance sheets. Additionally, the Company extended Ro’s exclusive period by approximately one year through July 1, 2023. Upon expiration of the exclusive period as amended, the exclusive right and license under the agreement shall automatically convert to non-exclusive for the remainder of term of the agreement unless further extended. The agreement may be terminated by mutual agreement after the exclusive period expired. During the years ended December 31, 2021 and 2020, the Company recognized $9.7 million and $2.5 million, respectively, of product revenue, net, in the accompanying consolidated statements of operations with respect to Ro. The Company recorded a deferred income balance of $31.0 million at December 31, 2021 and an accounts receivable balance of $0.6 million at December 31, 2020 with respect to Ro in the accompanying consolidated balance sheets. GoGoMeds In February 2020, the Company entered into a two-year exclusive distribution agreement with GoGoMeds (“GGM”), giving GGM exclusive distributor rights to all online and mail orders generated in the United States, except those via telehealth. GGM submits purchase orders as needed to Cardinal Health and Cardinal Health ships to GGM. Once GGM has accepted the delivered Product, GGM takes control of the Product and the Company is entitled to payment. The Company began shipping products to GGM in May 2020. The Company recognizes revenue based on units shipped to GGM and upon transfer of physical control. During the years ended December 31, 2021 and 2020, the Company recognized $1.5 million and $0.1 million, respectively, of product revenue, net, in the accompanying consolidated statements of operations with respect to GGM. At December 31, 2021 and December 31, 2020, the Company recorded an accounts receivable balance of $0.8 million and $0.1 million, respectively, prior to reserves and allowances, in the accompanying consolidated balance sheets with respect to GGM. CMS Bridging DMCC In June 2020, the Company and CMS Bridging DMCC (“CMS”) entered into a set of licensing, collaboration, and investing agreements (“CMS Agreements”) involving the license of the Company’s intellectual property (“IP”) to CMS in Singapore and Greater China (the “CMS Territory”) and governing the supply of product from the Company to CMS for sale in the CMS Territory, together with an agreement for CMS to invest in the Company’s Series Growth 3 & 4 Preferred Shares. Under the terms of the CMS Agreement, the Company granted CMS an exclusive, transferable, sub-licensable, and royalty-bearing license of the Company’s IP to develop, import, register, manufacture, and commercialize the Product, whether through online sales channels or offline sales channels during the term of the agreement. The agreement can be terminated earlier by mutual agreement of the parties. In accordance with the CMS Agreement, all legal and beneficial ownership of (i) all IP rights relating to the Products (including any data generated from the use of the Products and other improvements) and (ii) all of the information provided or generated under the agreement or otherwise related to the Products shall both ultimately belong to and remain vested with the Company. CMS must purchase the Product from the Company at a markup of the Company’s cost of goods sold. As consideration for the rights and licenses granted by the Company to CMS under the agreement, CMS paid the Company a one-time, non-refundable and non-creditable upfront fee of $15.0 million and is required to pay a one-time, non-refundable, and non-creditable milestone payment of $5.0 million within thirty days after the earlier of (i) the approval of marketing authorization as a prescription product by the Product by National Medical Products Administration, and (ii) the fifth anniversary of the agreement’s effective date. The CMS Agreement also contains commercial milestones due to the Company based on the achievement of annual net product revenue thresholds in the CMS Territory. Additionally, CMS shall pay the Company royalties on net sales of all products in the CMS Territory commencing January 1, 2022 through the expiration date of the agreement. The Company determined the only performance obligation that exists is the licensing of the Product in the CMS Territory. The transactions price consisted of the $15.0 million upfront payment and the discounted time-based milestone of $3.7 million with the difference of $1.3 million accreted as interest income over five years with the remaining balance being accreted in full upon the approval of the marketing authorization as a prescription product if achieved prior to the end of the five years. The IP license granted to CMS represents a right to use the IP and therefore is recognized at a point in time, which was determined to be the effective date of the agreements. As such, the Company recognized revenue in the amount of $18.7 million during the year ended December 31, 2020, which is included under license and collaboration revenue in the accompanying consolidated statements of operations. At December 31, 2021 and December 31, 2020, the discounted time-based milestone had a balance of $4.1 million and $3.9 million, respectively, included in other assets in the accompanying consolidated balance sheets. The royalties and other commercial milestones will only be recognized in the periods in which the applicable subsequent sales occur. Total Product Revenue, net and Reserves During the years ended December 31, 2021 and 2020, the Company recognized $11.2 million and $2.7 million, respectively, of product revenue, net in the accompanying consolidated statements of operations. At December 31, 2021 and December 31, 2020, the Company had accounts receivable of $0.7 million and $0.8 million, respectively, prior to reserves and allowances. The following table summarizes the activity in the product revenue reserve and allowance for the years ended December 31, 2021 and 2020 (in thousands): Product Revenue Reserves Balance at December 31, 2019 $ — Provision related to product sales 980 Credits and payments made (966) Balance at December 31, 2020 14 Provision related to product sales 522 Credits and payments made (454) Balance at December 31, 2021 $ 82 At December 31, 2021 and 2020, 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 consolidated balance sheets for the year. Through December 31, 2021, there had been no product related reserves or allowances owed to other parties, including the federal and state governments or their agencies. |
Inventories_2
Inventories | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Inventories | 6. Inventories Inventories consisted of the following (in thousands): June 30, December 31, 2022 2021 Raw materials $ 9,599 $ 8,074 Work in process 4,746 2,643 Finished goods 4,476 2,786 Total inventories $ 18,821 $ 13,503 | |
Gelesis | ||
Inventories | 6. Inventories Inventories consisted of the following (in thousands): At December 31, 2021 2020 Raw materials $ 8,074 $ 1,213 Work in process 2,643 913 Finished goods 2,786 2,433 Consignment inventories — 563 Total inventories $ 13,503 $ 5,122 |
Prepaid Expenses and Other Cu_4
Prepaid Expenses and Other Current Assets (Imported) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Prepaid Expenses and Other Current Assets | 7. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): June 30, December 31, 2022 2021 Prepaid expenses $ 1,128 $ 982 Prepaid insurance 1,474 55 Prepaid manufacturing expenses 596 2,624 Prepaid contract research costs 185 262 Research and development tax credit 692 579 Value added tax receivable 1,574 5,633 Deferred financing costs — 3,855 Income tax receivable 198 213 Investment tax credit 906 — Prepaid expenses and other current assets $ 6,753 $ 14,203 | |
Gelesis | ||
Prepaid Expenses and Other Current Assets | 7. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following (in thousands): At December 31, 2021 2020 Prepaid expenses $ 3,874 $ 1,024 Prepaid contract research costs 262 169 Research and development tax credit 579 1,131 Value added tax receivable 5,633 4,315 Deferred financing costs 3,855 38 Prepaid expenses and other current assets $ 14,203 $ 6,677 |
Property and Equipment Net
Property and Equipment Net | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Property and Equipment, Net | 8. Property and Equipment, Net Property and equipment, net, consisted of the following (in thousands): June 30, December 31, 2022 2021 Laboratory and manufacturing equipment $ 28,158 $ 28,101 Land and buildings 10,186 10,404 Leasehold improvements 1,490 1,614 Computer equipment and software 529 463 Capitalized software 232 228 Construction in process 21,683 22,097 Property and equipment – at cost 62,278 62,907 Less accumulated depreciation (5,973) (4,392) Property and equipment – net $ 56,305 $ 58,515 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 a 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 June 30, 2022 and December 31, 2021 are related to the development of manufacturing lines that have not yet been placed into service at June 30, 2022 and December 31, 2021, respectively. Depreciation expense was approximately $0.4 million and $0.2 million for the three months ended June 30, 2022 and 2021, respectively, and $1.4 million and $0.4 million for the six months ended June 30, 2022 and 2021, respectively. | |
Gelesis | ||
Property and Equipment, Net | 8. Property and Equipment, Net Property and equipment, net, consists of the following (in thousands): At December 31, 2021 2020 Laboratory and manufacturing equipment $ 28,101 $ 8,176 Land and buildings 10,404 4,334 Leasehold improvements 1,614 1,742 Computer equipment and software 463 176 Capitalized software 228 17 Construction in process 22,097 35,551 Property and equipment – at cost 62,907 49,996 Less accumulated depreciation (4,392) (3,101) Property and equipment – net $ 58,515 $ 46,895 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 a 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 December 31, 2021 and 2020 are related to the development of manufacturing lines that have not yet been placed into service at December 31, 2021. Depreciation expense was approximately $1.5 million and $0.5 million and for the years ended December 31, 2021 and 2020, respectively. |
Accrued Expenses_2
Accrued Expenses | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Accrued Expenses | 9. Accrued Expenses Accrued expenses and other current liabilities consisted of the following (in thousands): June 30, December 31, 2022 2021 Accrued payroll and related benefits $ 2,442 $ 1,384 Accrued professional fees and outside contractors (including due to related party of 2,392 4,359 Accrued property, plant and equipment additions 589 1,257 Accrued inventory and manufacturing expense 285 128 Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) 2,612 5,604 Tax payables 70 145 Deferred legal fees 738 738 Accrued interest 587 45 Total accrued expenses $ 9,715 $ 13,660 | |
Gelesis | ||
Accrued Expenses | 9. Accrued Expenses Accrued expenses and other current liabilities consist of the following (in thousands): At December 31, 2021 2020 Accrued payroll and related benefits $ 1,384 $ 3,009 Accrued professional fees and outside contractors (including due to related party of $60 and $109, respectively) 4,359 3,494 Accrued property, plant and equipment additions 1,257 768 Accrued inventory and manufacturing expense 128 — Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) 5,604 — Income taxes payable 145 — Deferred IPO Fees 738 — Accrued interest 45 49 Total accrued expenses $ 13,660 $ 7,320 |
Other Long-Term Liabilities_2
Other Long-Term Liabilities | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Other Long-Term Liabilities | 10. Other Long-Term Liabilities Other long-term liabilities consisted of the following (in thousands): June, December 31, 2022 2021 Long-term tax liabilities 91 182 Contingent loss for research and development tax credits 2,755 2,990 One S.r.l. call option (see Note 11) 3,062 2,416 Total other long-term liabilities $ 5,908 $ 5,588 | |
Gelesis | ||
Other Long-Term Liabilities | 10. Other Long-Term Liabilities Other long-term liabilities consist of the following (in thousands): At December 31, 2021 2020 Deferred IPO fees $ — $ 738 Long-term tax liabilities 182 301 Contingent loss for research and development tax credits 2,990 3,233 Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) — 5,912 One Srl call option (see Note 11) 2,416 1,545 Total other long-term liabilities $ 5,588 $ 11,729 |
Significant Agreements_2
Significant Agreements | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Significant Agreements | 11. Significant Agreements Puglia 1 Grant 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”), The Company recognized grant income of $0.4 million and $0.4 million in other income, net, on the accompanying condensed consolidated statements of operations during the six months ended June 30, 2022 and 2021, respectively, related to the PIA 1 Grant, of which less than $0.1 million and $0.4 million was attributable to research and development expenses and investments in facilities and equipment, respectively, during the six months ended June 30, 2022 and less than $0.2 million was attributable to both research and development expenses and investments in facilities and equipment, respectively, during the six months ended June 30, 2021. The Company recorded $5.5 million and $6.4 million of deferred income in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively, of which $0.8 million and $0.9 million was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying condensed consolidated balance sheets. The Company collected zero proceeds from the PIA 1 Grant during the six months ended June 30, 2022, and recorded a grant receivable of $5.0 million and $5.4 million in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively. Puglia 2 Grant 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”), The Company recognized grant income of $1.0 million and $1.0 million in other income, net, on the accompanying condensed consolidated statements of operations during the six months ended June 30, 2022, and 2021, respectively, related to the PIA 2 Grant, which was entirely attributable to research and development expenses. The Company has recorded $3.4 million and $3.7 million of deferred income in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively, of which $0.2 million and $0.4 million was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying condensed consolidated balance sheets. The Company collected zero proceeds from the PIA 2 Grant during the six months ended June 30, 2022, and has recorded a grant receivable of $4.4 million and $3.6 in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively. One S.r.l. (“One”) Amended Patent License and Assignment Agreement In June 2019, the Company amended and restated an existing master agreement with One (the “2019 One Amendment”), the original inventor of the Company’s core patents and a related party to the Company (see Notes 19 and 20). Under the amended and restated master agreement following this transaction, the Company eliminated certain future commercial milestone obligations and received a reduction in the percentage of royalties the Company was required to pay on future net sales. In return, One received additional consideration consisting of new future milestones upon the commercial success of new medical indications and a contingently issuable warrant for redeemable convertible preferred stock. Additionally, the Company acquired a 10% equity interest in One in exchange for cash consideration. The Company accounted for the reduction in royalties the Company is required to pay on future net revenues that resulted from the 2019 One Amendment 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. The Company accounted for the acquisition of the 10% equity interest in One under ASC 323, Investments – Equity Method and Joint Ventures. In connection with the acquisition of the 10% equity interest in One, the Company made a payment of $2.9 million to One shareholders during the six months ended June 30, 2022. The Company had remaining undiscounted payments of €2.5 million and €5.0 million due to One at June 30, 2022 and December 31, 2021, respectively (approximately $2.6 million and $5.7 million due to One at June 30, 2022 and December 31, 2021, respectively). The remaining payments at June 30, 2022 were recorded 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 June 30, 2022 and December 31, 2021, respectively. A summary of the intangible asset activity that resulted from this transaction during the six months ended June 30, 2022 is as follows (in thousands): Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Cumulative amortization expense (5,667) Balance at December 31, 2021 $ 15,680 Period amortization expense (1,133) Balance at June 30, 2022 $ 14,547 In October 2020, the Company further amended the terms of the agreement with One to 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 $6.3 million at June 30, 2022). 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 (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 S.r.l. 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 S.r.l. call option liability during the six months ended June 30, 2022 (in thousands): Balance at December 31, 2021 $ 2,416 Change in fair value 865 Foreign currency translation gain (219) Balance at June 30, 2022 $ 3,062 The following weighted average assumptions were used to determine the fair value of the One S.r.l. call option liability at June 30, 2022 and December 31, 2021: June 30, December 31, 2022 2021 Expected term 4.0 years 2.0 years Expected volatility 64.0 % 62.0 % Expected dividend yield 0.0 % 0.0 % Risk free interest rate 3.0 % 0.70 % Estimated fair value of ownership interest $ 6,097 $ 6,922 Exercise price of call option $ 6,270 $ 6,806 Research Innovation Fund (“RIF”) Financing In August 2020, the 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 $10.4 million at June 30, 2022) from RIF as an equity investment and €15.0 million (approximately $15.7 million at June 30, 2022) 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 June 30, 2022, RIF holds approximately 20% of the equity of Gelesis S.r.l. The Company recorded accretion of $0.2 million and foreign currency translation gain of $0.9 million to the noncontrolling interest during the six months ended June 30, 2022. The noncontrolling interest balance was $11.1 million and $11.9 million at June 30, 2022 and December 31, 2021, respectively, in the accompanying condensed consolidated balance sheets. | |
Gelesis | ||
Significant Agreements | 11. Significant Agreements Puglia 1 Grant 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. The PIA 1 Grant provides funding of up to €5.3 million (approximately $6.0 million at December 31, 2021) as reimbursement for certain facility and equipment investments in the Company’s manufacturing facility in Calimera, Italy, and up to €3.9 million (approximately $4.4 million at December 31, 2021) as reimbursement for certain research and development expenditures over a three-year period. The Company is required to adhere to standard workplace safety regulations and local laws in Italy and is not permitted to physically move the reimbursed assets from the Puglia region for five years from the project completion date of May 2023. The Company has concluded that income recognition is appropriate as it is reasonably assured that it will comply with all the conditions of the grant and the proceeds from the grant for costs incurred to date will be received. The Company recognized grant income of $0.5 million and $3.5 million in other income, net, on the accompanying consolidated statements of operations during the years ended December 31, 2021 and 2020, respectively, related to the PIA 1 Grant, of which $0.2 million and $0.2 million was attributable to research and development expenses and investments in facilities and equipment, respectively, during the year ended December 31, 2021 and $3.4 million and $0.1 million was attributable to research and development expenses and investments in facilities and equipment, respectively, during the year ended December 31, 2020. The Company recorded $6.4 million and $5.8 million of deferred income in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively, of which $0.9 million and $0.6 million was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying consolidated balance sheets. The Company collected zero proceeds and $4.9 million from the PIA 1 grant during the years ended December 31, 2021 and 2020, respectively, and recorded a grant receivable of $5.4 million and $4.3 million in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively. Puglia 2 Grant 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 PIA 2 Grant provides funding of up to €3.3 million (approximately $3.7 million at December 31, 2021) as reimbursement for certain facility and equipment investments in the Company’s manufacturing facility in Calimera, Italy, and up to €8.3 million (approximately $9.4 million at December 31, 2021) as reimbursement for certain research and development expenditures over a three-year period. The Company is required to adhere to standard workplace safety regulations and local laws in Italy and is not permitted to physically move the reimbursed assets from the Puglia region for five years from the project completion date of November 2023. The Company has concluded that income recognition is appropriate as it is reasonably assured that it will comply with all the conditions of the grant and the proceeds from the grant for costs incurred to date will be received. The Company recognized grant income of $1.1 million and $0.8 million in other income, net, on the accompanying consolidated statements of operations during the years ended December 31, 2021, and 2020, respectively, related to the PIA 2 Grant, which was entirely attributable to research and development expenses. The Company has recorded $3.7 million and $3.0 million of deferred income in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively, of which $0.4 million and zero was recorded as a current liability, respectively, as it is expected to be recognized within one year of the date of the accompanying consolidated balance sheets. The Company collected $1.9 million and zero proceeds from the PIA 2 grant during the years ended December 31, 2021 and 2020, respectively, and has recorded a grant receivable of $3.6 million and $3.9 in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively. 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 19 and 20), to license and subsequently purchase certain intellectual property to develop hydrogel-based product candidates. In December 2014, the Company amended and restated the patent license agreement and the master agreement into a single agreement, referred to as the amended and restated master agreement. The amended and restated master agreement will remain in effect until the expiration of the last patents covered by the agreement or until all obligations under the amended and restated master agreement with respect to payments have terminated or expired. In June 2019, the Company entered into a transaction with One that further amended the terms of the amended and restated master agreement and resulted in the Company owning 10% equity interest in One (the “2019 One Amendment”). Under the amended and restated master agreement following this transaction, €5.5 million (approximately $6.2 million at December 31, 2021) the Company would be required to pay upon the achievement of future commercial milestones from weight loss medical indications were eliminated, and the percentage of royalties the Company is required to pay on future net revenues was reduced. In return, One received additional consideration consisting of new future milestones of up to €11.0 million (approximately $12.5 million at December 31, 2021) upon the commercial success of new medical indications, and the Company was required to issue to One a warrant for redeemable convertible preferred stock equivalent to 2.7% of the shares of capital stock outstanding on an as converted basis within 30 days of the completion of a future qualifying equity financing that results in at least $50.0 million in gross proceeds. The warrant would have an exercise price equivalent to the issuance price of a future qualifying equity financing (see Note 13). As an additional component to this transaction, the Company acquired a 10% equity interest in One in exchange for cash consideration of €11.5 million (approximately $13.0 million at December 31, 2021) with a net present value of €11.1 million (approximately $12.7 million at the transaction date). During the year ended December 31, 2021 the Company did not make any payments of the agreed upon cash consideration. During the year ended December 31, 2020, the Company paid €2.6 million (approximately $3.1 million at the transaction date) of the agreed upon cash consideration. The unpaid cash consideration to One, after adjusting for a foreign currency translation gain and interest expense was $5.6 million and $5.9 million at December 31, 2021 and 2020, respectively. At December 31, 2021, all $5.6 million was included in accrued expenses in the accompanying consolidated balance sheets as it was expected to be settled within the next twelve months. At December 31, 2020, all $5.9 million was included in other long-term liabilities in the accompanying consolidated balance sheets. None of the future milestones under the master agreement, as amended, have been met, or are deemed to be probable of being met, at the transaction date or at December 31, 2021 and 2020, respectively. The Company accounted for the reduction in royalties the Company is required to pay on future net revenues that resulted from the 2019 One Amendment as an intangible asset under ASC 350, Intangibles Goodwill and Other Investments — Equity Method and Joint Ventures Consideration Cash $ 12,668 Warrants for redeemable convertible preferred stock 4,706 Fair value of total consideration $ 17,374 Assets acquired at relative fair value Intangible asset related to reduction in royalty $ 15,564 Equity-method investment 1,810 Total assets acquired $ 17,374 The Company accounted for tax impact of the acquisition of the intangible asset under ASC 740, Income Taxes, which resulted in the recognition of a deferred tax liability of $5.8 million, to account for the book-to-tax basis difference, that was applied to the initial carrying value of the intangible asset acquired. A summary of the intangible asset activity that resulted from this transaction during the years ended December 31, 2021 and 2020 is as follows (in thousands): Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Amortization expense (1,133) Balance at December 31, 2019 $ 20,214 Amortization expense (2,267) Balance at December 31, 2020 $ 17,947 Amortization expense (2,267) Balance at December 31, 2021 $ 15,680 In conjunction with acquiring the investment in One, the Company recognized a deferred tax asset of approximately $3.1 million which represents the excess tax basis over carrying value. The Company recorded this deferred tax asset with a corresponding decrease to the amounts initially allocated to the investment. As the deferred tax asset exceeds the initially allocated balances and results in a reduction of the initial carrying value of the $1.8 million investment balance to zero, the remaining $1.2 million excess was recorded as a deferred credit. In May 2020, the Company transferred the equity-method investment in One from the Gelesis entity in Italy to a Gelesis entity in the US. In connection with the transfer of the equity-method investment, the Company wrote-off the deferred tax asset of $3.0 million generated by the book-to-tax difference and the deferred credit of $1.2 million, resulting in an expense of $1.8 million recorded within provision for income taxes in the accompanying consolidated statements of operations during the year ended December 31, 2020. In October 2020, the Company further amended the terms of the amended and restated master agreement with One to cancel its obligation to issue to One the warrant for redeemable convertible preferred stock agreed to in the 2019 One Amendment (the “2020 One Amendment”). In return for cancelling the warrant, One received additional consideration consisting of a commercial milestone of €6.5 million (approximately $7.4 million at December 31, 2021) upon a weight loss product reaching €2.0 billion in cumulative net sales, and certain shareholders of One were granted warrants to purchase 522,009 shares of the Company’s common stock. The warrant for redeemable convertible preferred stock was remeasured prior to settlement. 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 $6.8 million at December 31, 2021). 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 (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 Company accounted for the 2020 One Amendment by derecognizing the carrying value of the warrant liability for redeemable convertible preferred stock on the date of the 2020 One Amendment, which had a fair value of approximately $6.0 million, and recognizing the consideration provided in the amendment, which had an aggregate fair value of approximately $5.8 million. The difference between the consideration provided by the Company and the warrant liability derecognized, approximately $0.2 million, represents a gain on settlement of the warrant liability and was recognized in other income (expense), net, on the accompanying consolidated statements of operations during the year ended December 31, 2020. As the contingent call option granted to One shareholders to buy back the 10% investment in One did not meet the definition of a derivate under ASC 815, Derivatives and Hedging, the Company recorded the grant date fair value of the call option, approximately $1.5 million, to other long-term liabilities on the consolidated balance sheets. Increases or decreases in fair value of the contingent call option are recorded in the consolidated statements of operations. The Company accounted for the common stock warrants under ASC 815, Derivatives and Hedging, which resulted in recording the grant date fair value of the common stock warrants, approximately $4.3 million, to additional paid in capital in the accompanying consolidated balance sheets. As the common stock warrants are equity-classified, the warrants are recorded at their initial fair value and not subsequently remeasured. The commercial milestone added as part of the 2020 One Amendment constitutes contingent consideration and was provided as additional consideration for a license or asset acquisition, representing one component of the consideration replacing the warrant liability previously provided as part of the consideration for the license. Under asset acquisition accounting, contingent consideration is not recognized until the contingency is resolved. As such, no amount was recognized for the contingent milestone on the date of the amendment. A summary of the gain on the warrant liability settlement that resulted from the 2020 One Amendment during the year ended December 31, 2020 is as follows (in thousands): Carrying value of warrants for redeemable convertible preferred stock $ 5,973 Fair value of common stock warrants, net of cash consideration paid of $10 (4,312) Fair value of contingent call option granted to One shareholders (1,494) Gain on warrant liability extinguishment $ 167 Research Innovation Fund (“RIF”) Financing In August 2020, the 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 $11.3 million at December 31, 2021) from RIF as an equity investment and €15.0 million (approximately $17.0 million at December 31, 2021) as a loan with a fixed interest rate of 6.35% per annum (see Note 12). The equity investment can be called by Gelesis, Inc., 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 December 31, 2021, RIF holds approximately 20% of the equity of Gelesis S.r.l. The Company concluded that Gelesis Inc. is the only equity investment at risk as RIF’s investment is not considered equity due to the call and put options. The Company further evaluated the sufficiency of the equity at risk and concluded that given the fact that Gelesis S.r.l. had to receive the RIF investment, which represents subordinated financial support but not equity, the fair value of Gelesis Inc. equity is not sufficient to absorb its expected losses resulting from its research and development operations and business plan, rather some of its expected losses will have to be absorbed by the RIF investment. The RIF investment is equity held by a noncontrolling interest. Since the put option does not make the equity mandatorily redeemable, and the call option is held by the Company, the noncontrolling interest is not considered mandatorily redeemable and as such, is not presented as a liability. The noncontrolling interest is therefore classified as temporary equity — noncontrolling interest, and is accounted for in accordance with ASC 810, Consolidation The noncontrolling interest is initially recorded at €10.0 million (approximately $11.3 million at transaction date, net of issuance costs of $0.4 million), the consideration allocated to the shareholder investment based on its fair value. The Company has applied ASC 810 to subsequently remeasure the noncontrolling interest, which results in no losses being attributed to the noncontrolling interest, rather, only earnings of the Gelesis S.r.l. entity based on the shareholder rights as a whole instrument. However, the noncontrolling interest shall not be reduced below the current redemption value of the put option, which represents the initial investment plus the accrued rate of return of 3.175% per annum. Adjustments to the noncontrolling interest that result from accreting the put option to its redemption value are recorded to accumulated deficit in the accompanying consolidated balance sheets. The Company recorded accretion of $0.6 million and foreign currency translation loss of $0.5 million to the noncontrolling interest during the year ended December 31, 2020. The Company recorded accretion of $0.4 million and foreign currency translation gain of $1.0 million to the noncontrolling interest during the year ended December 31, 2021. The noncontrolling interest balance was $11.9 million and $12.4 million at December 31, 2021 and 2020, respectively, in the accompanying consolidated balance sheets. |
Debt_2
Debt | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Debt | 12. Debt The Company’s non-convertible debt outstanding at June 30, 2022 and December 31, 2021 is summarized as follows: June 30, December 31, 2022 2021 Italian Economic Development Agency Loan 323 525 Intesa Sanpaolo Loan 1 7,384 8,507 Intesa Sanpaolo Loan 2 5,225 5,672 Horizon 2020 Loan 414 486 RIF Shareholders Loan 15,674 17,015 UniCredit Loan 5,188 5,630 Total debt obligation $ 34,208 $ 37,835 Unamortized loan discount and issuance costs (1,016) (754) Total debt obligation carrying amount $ 33,192 $ 37,081 Current portion $ 3,177 $ 1,950 Long-term portion $ 30,015 $ 35,131 2021 Bridge Financing On December 13, 2021, the Company issued convertible promissory notes to related parties in the principal amount of $27.0 million (see Note 20). At December 31, 2021, the outstanding balance was $27.1 million, recorded at fair value in the accompanying condensed consolidated balance sheets. On January 19, 2022 the Company settled the convertible promissory notes in cash for principal plus accrued interest in the aggregate amount of $27.3 million. During the six months ended June 30, 2022, the Company recognized a loss of $0.2 million with respect to the change in fair value of the convertible promissory notes on the accompanying condensed consolidated statements of operations. Future maturities with respect to debt outstanding at June 30, 2022 are as follows (in thousands): At June 30, 2022 Remaining 2022 obligation 1,362 2023 7,909 2024 5,315 2025 3,868 2026 3,889 More than 5 years 11,865 Total maturities $ 34,208 | |
Gelesis | ||
Debt | 12. Debt Italian Economic Development Agency Loan In May 2014, the Company entered into a loan agreement with an Italian economic development agency in connection with a grant. In February 2016, the Company received a second tranche of financing under this loan agreement. Borrowings under the loan totaled €1.2 million (approximately $1.4 million at December 31, 2021), and the loan bears interest at 0.332% per annum. The Company is required to make annual principal and interest payments from January 2017 through January 2024. Intesa Sanpaolo Loan In November 2019, the Company entered into a loan agreement with Intesa Sanpaolo. Initial borrowings under the loan totaled €2.4 million (approximately $2.8 million at December 31, 2021), net of transaction costs of €0.1 million (approximately $0.1 million at December 31, 2021), and the loan bears interest at base rate of 2.3% plus the 3-month During the year ended December 31, 2020, the Company borrowed an additional €5.0 million (approximately $5.7 million at December 31, 2021), net of transaction costs of approximately €13,000 (approximately $14,000 at December 31, 2021). The additional borrowings under the loan had the same terms and repayment schedule as the November 2019 loan. In March 2021, the Company entered into another loan agreement with Intesa Sanpaolo for aggregate borrowing of up to €5.0 million. Borrowings under the second loan agreement upon closing and at December 31, 2021, totaled €4.8 million (approximately $5.4 million at December 31, 2021), net of transaction costs of €0.2 million (approximately $0.2 million at December 31, 2021), and the loan bears interest at base rate of 0.701%. The Company is required to make payments of interest only on borrowings under the loan agreement on a monthly basis through March 2023 (the interest only termination date), after which payments of principal in equal monthly installments and accrued interest will be due until the loan matures on March 26, 2024. Horizon 2020 Loan In December 2019, as part of the Horizon 2020 Grant (see Note 11), the Company entered into a loan agreement with the Italian Finance Ministry. Borrowings under the loan totaled €0.3 million (approximately $0.3 million at December 31, 2021), net of transaction costs and discounts of approximately €21,000 (approximately $24,000 at December 31, 2021), and the loan bears interest at 0.171% per annum. The Company is required to make payments of interest only on borrowings under the loan agreement on a semiannual basis through and including June 30, 2020 (the interest only termination date), after which payments of principal in equal semiannual installments and accrued interest will be due until the loan matures on June 30, 2028. In October 2020, the Company borrowed an additional €0.2 million (approximately $0.2 million at December 31, 2021), net of transaction costs of approximately €19,000 (approximately $22,000 at December 31, 2021). The additional borrowings under the loan had the same terms and repayment schedule as the December 2019 loan. RIF Shareholders Loan In August 2020, as part of the RIF financing transaction (see Note 11), the Company entered into a loan agreement with the shareholders of RIF. Borrowings under the loan totaled €14.5 million (approximately $16.4 million at December 31, 2021), net of transaction costs of €0.5 million (approximately $0.6 million at December 31, 2021), and the loan bears interest at 6.35% per annum. The Company is required to make payments of interest only on borrowings under the loan agreement on an annual basis starting December 31, 2020 and through and including December 30, 2022 (the interest only termination date), after which payments of principal in equal annual installments and accrued interest will be due until the loan matures on December 31, 2030. If either party exercises its call option or put option on the equity investment as part of the RIF Transaction, the unpaid principal and accrued interest as of that date must be paid by the Company. UniCredit Loan In November 2020, the Company entered into a loan agreement with UniCredit. Borrowings under the loan totaled €4.9 million (approximately $5.7 million at December 31, 2021), net of transaction costs and discounts of €0.1 million (approximately $0.1 million at December 31, 2021), and the loan bears interest at 2.12% per annum. The Company is required to make payments of principal and accrued interest on a semiannual basis starting December 10, 2021 until the loan matures on December 10, 2027. PPP Loan On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was enacted to, amongst other provisions, provide emergency assistance for individuals, families and businesses affected by the COVID-19 pandemic. The CARES Act includes a Paycheck Protection Program (“PPP”) administered through the Small Business Association (“SBA”). Under the PPP, beginning April 3, 2020, small businesses and other entities and individuals could apply for loans from existing SBA lenders and other approved regulated lenders that enroll in the program, subject to numerous limitations and eligibility criteria. In April 2020, the Company issued a promissory note to Silicon Valley Bank, pursuant to which it received loan proceeds of $0.3 million (the “PPP Loan”) provided under the PPP established under the CARES Act and guaranteed by the U.S. Small Business Administration. In November 2020, the Company was notified by Silicon Valley Bank that the PPP Loan had been fully forgiven by the SBA and there is no remaining balance on its account. The Company recognized income of $0.3 million in other income on the consolidated statements of operations during the year ended December 31, 2020, for debt extinguishment pursuant to ASC 470, Debt 2021 Bridge Financing On December 13, 2021, the Company entered into a bridge financing arrangement, executing convertible promissory note agreements for $12.0 million with SSD2 an existing investor and related party (see Note 20) and $15.0 million with PureTech, an existing investor and related party (see Note 20). These promissory notes bear interest at 10% and shall be settled in cash for principal plus accrued interest by the third (3rd) business day following the Business Combination Closing Agreement with CPSR, or thirty (30) days following the termination of the Business Combination Agreement. In the event the Business Combination Agreement is terminated, the majority holders of the promissory notes may elect to convert outstanding principal and interest into the securities being issued and sold to investors in a subsequent qualified financing at a discounted conversion price equal to 75% of the price per share paid by other investors in the financing. The Company elected to recognize the hybrid instrument at fair value at issuance and record subsequent changes in fair value in the accompanying consolidated statements of operations (see Note 3). At issuance the Company determined the aggregate fair value of the convertibles promissory notes was $27.0 million. At December 31, 2021, the fair value was determined to be $27.1 million. During the year ended December 31, 2021, the Company recognized a loss of $0.1 million with respect to the change in fair value of the convertible promissory notes on the accompanying consolidated statements of operations. Future maturities with respect to non-convertible debt outstanding at December 31, 2021 are as follows (in thousands): At December 31, 2021 2022 2,183 2023 8,585 2024 5,771 2025 4,199 2026 4,221 More than 5 years 12,877 Unamortized loan discount and issuance costs (754) Total obligation $ 37,081 |
Warrants_2
Warrants | 12 Months Ended |
Dec. 31, 2021 | |
Gelesis | |
Warrants | 13. Warrants Summary of Outstanding Warrants The following represents a summary of the warrants outstanding at December 31, 2021: Number of Shares Issued Classification Exercisable for Issuable August 2013 Liability Series A-4 redeemable convertible preferred stock (“Series A-4”) 708,493 October 2020 Equity Common stock 522,009 The following represents a summary of the warrants outstanding at December 31, 2020: Number of Shares Issued Classification Exercisable for Issuable April 2011 Liability Series A-1 redeemable convertible preferred stock (“Series A-1”) 74,784 June 2012 Liability Series A-3 redeemable convertible preferred stock (“Series A-3”) 238,189 August 2013 Liability Series A-4 redeemable convertible preferred stock (“Series A-4”) 708,493 October 2020 Equity Common stock 522,009 Warrants Issued in Connection with 2008 Loan Agreement In April 2011, in connection with an amendment to the 2008 Loan, the Company issued a warrant to purchase shares of Series A-1 at an exercise price equal to the lower of $4.44 per share or the price per share received in the first sale of shares of the Company’s stock resulting in at least $5.0 million gross proceeds to the Company. The warrant is exercisable for the number of shares of Series A-1 equal to the quotient of $0.3 million divided by the exercise price of the warrant. Following the issuance of Series A-5 redeemable convertible preferred stock (“Series A-5”) in March 2015 (see Note 14) the warrant became exercisable for 74,784 shares of Series A-1 at an exercise price of $4.44. The warrant terminates upon the earlier of (i) April 27, 2021, (ii) three years after the effective date of an initial public offering or (iii) a sale of the Company. The warrant liability is remeasured at each reporting date with increases or decreases in the fair value being recorded in the consolidated statements of operations. The fair value of the warrants was $0.6 million at December 31, 2020. In April 2021, the Company issued 52,222 shares of Series A-1 upon the net exercise of the remaining outstanding warrants. The warrants exercised had an aggregate fair value of $0.9 million on the date of exercise. No Series A-1 warrants remained outstanding at December 31, 2021. Series A-3 Warrants In June 2012, in connection with an amendment to the Master Agreement and Patent and License Assignment Agreement with One (see Note 11), in exchange for the right to expand the field use of the intellectual property purchased, the Company issued fully vested warrants to purchase 238,189 shares of Series A-3 at an exercise price of $0.04 per share. The warrant is subject to automatic exercise upon a deemed liquidation event, as defined, in the Company’s Restated Certification of Incorporation. The warrants expire in June 2022. The fair value of the warrants was $0.7 million at the date of issuance and was recorded as a research and development expense, and a corresponding warrant liability was recorded as a component of other non-current liabilities. The warrant liability is remeasured at each reporting date with increases or decreases in the fair value being recorded in the consolidated statements of operations. The fair value of the warrants was $2.9 million at December 31, 2020. In March 2021, the Company issued 238,189 shares of Series A-3 upon the exercise of the remaining outstanding warrants. The warrants exercised had an aggregate fair value of $3.0 million on the date of exercise. No Series A-3 warrants remained outstanding at December 31, 2021. Series A-4 Warrants In August 2013, in connection with the issuance of Series A-4, the Company issued contingent warrants to purchase 719,670 shares of Series A-4 at an exercise price of $0.04 per share. Such warrants were issuable if the Company did not sell shares of its common stock in a firm commitment underwritten public offering on or before February 15, 2015 or if the Company was liquidated, dissolved, wound up or closes a deemed liquidation event prior to an IPO. The warrants were issued in February 2015 when the contingencies were not met. The warrants expire in February 2025. The fair value of the warrants was $1.7 million at the date of issuance and was recorded as a research and development expense, and a corresponding warrant liability was recorded as a component of other non-current liabilities. The warrant liability is remeasured at each reporting date with increases or decreases in the fair value being recorded in the consolidated statements of operations. In October 2020, the Company issued 11,177 shares of Series A-4 upon the exercise of the associated warrants. The warrants exercised had an aggregate fair value of $0.1 million on the date of exercise. At December 31, 2021 and 2020, 708,493 warrants remained outstanding with an aggregate fair value of $15.8 million and $8.6 million, respectively. Series 3 Growth Warrants In June 2019, in connection with the terms of the amended and restated master agreement between the Company and One, the Company agreed to issue to One a warrant for redeemable convertible preferred stock equivalent to 2.7% of the shares of capital stock outstanding on an as converted basis within 30 days of the completion of a future equity financing that results in at least $50.0 million in gross proceeds with an exercise price equal to the issuance price of the future equity financing (see Note 11). Due to the fact that the settlement value was dependent on something other than the fair value of the issuer’s equity shares, ASC 480 — Distinguishing Liabilities from Equity In December 2019, the Company entered into the Series 3 & 4 Growth Preferred Stock Purchase Agreement (the “Series 3 & 4 Growth Agreement”), under which, it closed a $50.0 million equity financing round for Series 3 Growth (see Note 11) and the warrant became issuable for 478,828 shares of Series 3 Growth. In October 2020, the Company and One amended the terms of the amended and restated master agreement which resulted in the Company being relieved from its obligation to issue the warrants for Series 3 Growth in exchange for the delivery of warrants to common stock, a contingent call option and contingent consideration of the commercial milestone (see Note 11). The warrant liability relating to the obligation to issue Series 3 Growth warrants was adjusted to its extinguishment date fair value of $6.0 million prior to being derecognized. The difference between the consideration provided by the Company and the warrant liability derecognized resulted in a gain on warrant liability extinguishment of $0.2 million and was recognized in other income on the accompanying consolidated statements of operations during the year ended December 31, 2020. No Series 3 Growth warrants remained outstanding at December 31, 2020. Series 4 Growth Options Pursuant to the Series 3 & 4 Growth Agreement, Series 3 Growth shareholders were given the right, but not the obligation, to purchase shares of Series 4 Growth at a purchase price of $20.72, within one year of the Series 3 Growth initial closing in December 2019 (the “Series 4 Growth Options”). In conjunction with the 2,973,270 shares of Series 3 Growth issued during the Series 3 Growth initial closing, the Company issued 2,419,573 Series 4 Growth Options. During the year ended December 31, 2020, the Company issued an additional 2,845,625 shares of Series 3 Growth to current and new investors, resulting in the issuance of an additional 2,371,812 Series 4 Growth Options. The Series 4 Growth Options were evaluated under ASC 480 — Distinguishing Liabilities from Equity expiration of the options with increases or decreases in fair value being recorded in the consolidated statements of operations. At the date of issuance, the fair value of the Series 4 Growth Options was recorded at $0.7 million as a current liability in the accompanying consolidated balance sheets, as it was set to expire in December 2020 if unexercised. In connection with the subsequent issuances of Series 3 Growth in 2020 (see Note 14), the Company recorded an additional $0.7 million as a Series 4 Growth Option liability. In December 2020, the Series 4 Growth Options expired, resulting in a gain on the change in fair value of $1.4 million during the year ended December 31, 2020. Common Stock Warrants In October 2020, in connection with the 2020 One Amendment (see Note 11), the Company granted certain shareholders of One warrants to purchase 522,009 shares of the Company’s common stock. The Company accounted for the common stock warrants under ASC 815, Derivatives and Hedging |
Redeemable Convertible Preferre
Redeemable Convertible Preferred Stock | 12 Months Ended |
Dec. 31, 2021 | |
Gelesis | |
Redeemable Convertible Preferred Stock | 14. Redeemable Convertible Preferred Stock Redeemable convertible preferred stock consisted of the following at December 31, 2021 (in thousands, except for share data): Preferred Common Stock Stock Issued and Liquidation Carrying Issuable Upon Authorized Outstanding Preference Value Conversion Series A-1 1,711,755 1,689,193 $ 7,505 $ 7,113 1,689,193 Series A-2 1,161,254 1,161,254 3,030 3,033 1,161,254 Series A-3 1,730,874 1,730,874 5,188 7,460 1,730,874 Series A-4 2,159,022 1,450,529 5,473 2,602 1,450,529 Series A-5 1,977,114 1,977,114 24,536 44,307 1,977,114 Series Growth 2,538,274 2,538,274 31,500 56,959 2,538,274 Series 2 Growth 2,370,803 2,370,803 30,370 53,201 2,370,803 Series 3 Growth 6,308,529 5,818,895 150,768 136,919 5,818,895 Total 19,957,625 18,736,936 $ 258,370 $ 311,594 18,736,936 Redeemable convertible preferred stock consisted of the following at December 31, 2020 (in thousands, except for share data): Preferred Common Stock Stock Issued and Liquidation Carrying Issuable Upon Authorized Outstanding Preference Value Conversion Series A-1 1,711,755 1,636,971 $ 7,273 $ 6,176 1,636,971 Series A-2 1,161,254 1,161,254 3,030 3,033 1,161,254 Series A-3 1,730,874 1,492,685 4,474 4,463 1,492,685 Series A-4 2,159,022 1,450,529 5,473 2,602 1,450,529 Series A-5 1,977,114 1,977,114 24,536 24,991 1,977,114 Series Growth 2,538,274 2,538,274 31,500 32,763 2,538,274 Series 2 Growth 2,370,803 2,370,803 30,370 30,684 2,370,803 Series 3 Growth 6,308,529 5,818,895 150,768 108,813 5,818,895 Total 19,957,625 18,446,525 $ 257,424 $ 213,525 18,446,525 Series A-1 In April 2011, the Company issued units comprised of 1,636,971 shares of Series A-1 and 1,636,971 shares of common stock upon the conversion of $3.2 million of outstanding principal and accrued interest related to convertible notes issued in 2009 and 2010 and $0.4 million of deferred interest related to the 2008 Loan. The conversion was based on an issuance price of $4.44 per unit, whereby each unit is comprised of one share of Series A-1 and one share of common stock. In April 2021, the Company issued 52,222 shares of Series A-1 upon the net exercise of the Series A-1 warrants. The warrants exercised had an aggregate fair value of $0.9 million on the date of exercise. Series A-2 In May 2011, the Company issued: ● 409,440 shares of Series A-2 at an issuance price of $2.61 per share, resulting in gross proceeds of $1.1 million. ● 284,249 shares of Series A-2 upon conversion of $0.6 million outstanding principal and accrued interest on convertible notes issued in 2011 at a conversion price of $1.96 per share, recorded at the fair value of Series A-2 issued of $0.7 million. ● 191,625 shares of Series A-2 upon conversion of $0.5 million of deferred interest related to the 2008 Loan, based on an issuance price of $2.61 per share. In addition, in May 2011, the Company entered into an agreement with PureTech Health LLC (“PureTech”) to issue a total of 275,940 shares of Series A-2 in exchange for management and consulting services (see Note 20). The fair value of the services was not readily determinable and, accordingly, the initial carrying value of Series A-2 issued in exchange for services was equal to the then-current fair value of the Series A-2 of $0.7 million, based on the Series A-2 issuance price of $2.61 per share. Series A-3 In June 2012, the Company issued 1,017,648 shares of Series A-3 at an issuance price of $3.00 per share resulting in gross proceeds of $3.1 million and the Company incurred issuance costs of approximately $10,000. In June 2012, the Company issued 219,792 shares of Series A-3 upon conversion of $0.7 million of outstanding principal and accrued interest related to a promissory note issued in 2012 at an issuance price of $3.00 per share and 255,245 shares of Series A-3 upon the conversion of $0.7 million of outstanding principal and accrued interest related to a bridge loan issued in 2012 at $2.85 per share. In March 2021, the Company issued 238,189 shares of Series A-3 upon the exercise of the Series A-3 warrants. The warrants exercised had an aggregate fair value of $3.0 million on the date of exercise. Series A-4 In August 2013, the Company issued 1,439,352 equity units, each consisting of (i) one share of Series A-4 with a contingently issuable warrant to purchase 50% of one share of Series A-4 and (ii) one share of common stock of the LLC with a contingently issuable warrant to purchase 50% of one share of common stock of the LLC, for $3.00 per unit, resulting in proceeds of $4.3 million, net of issuance costs of approximately $11,000. The Company determined that the warrants to purchase shares of Series A-4 met the criteria for classification as a liability and were to be accounted for at fair value (see Note 13). Accordingly, the proceeds from the sale of the equity units were first allocated to the Series A-4 warrants at their fair value at issuance of $1.7 million, with the residual proceeds allocated to the Series A-4, the LLC common stock and the LLC common warrants based on their relative fair values of $2.5 million, $0.1 million and $0.1 million, respectively. In October 2020, the Company issued 11,177 shares of Series A-4 upon the exercise of the Series A-4 warrants. The warrants exercised had an aggregate fair value of $0.1 million on the date of exercise. Series A-5 In March 2015, the Company issued 1,450,265 shares of Series A-5 at an issuance price of $12.41 per share resulting in gross proceeds of $18.0 million and the Company incurred issuance costs of $0.1 million. In conjunction with the financing, approximately $4.3 million of outstanding principal and accrued interest on the 2014 Bridge Notes converted to 492,900 shares of Series A-5 at a conversion price of $8.69. In a subsequent and final closing in April 2015, the Company issued 33,949 shares of Series A-5 at an issuance price of $12.41 per share resulting in gross proceeds of $0.4 million. Series Growth In December 2015, the Company issued 2,538,274 shares of Series Growth to current and new investors at an issuance price of $12.41 per share resulting in gross proceeds of $31.5 million and the Company incurred issuance costs of $0.1 million. Series 2 Growth In February 2018, the Company entered into the Series 2 Growth Preferred Stock Purchase Agreement with current investors (the “Series 2 Growth Initial Purchasers”). In the February 2018 closing, the Series 2 Growth Initial Purchasers purchased 780,640 shares of Series 2 Growth at an issuance price of $12.81 resulting in gross proceeds of $10.0 million and the Company incurred issuance costs of $0.2 million. The Series 2 Growth Initial Purchasers also agreed to purchase up to 1,561,280 additional Series 2 Growth shares for aggregate proceeds of $20.0 million in subsequent closings. In the June 2018 closing, the Company issued 9,269 shares of Series 2 Growth resulting in gross proceeds of $0.1 million and the Company incurred issuance costs of approximately $6,000. In September 2018, under the Series 2 Growth Tranche Rights, the Company issued 390,320 shares of Series 2 Growth resulting in gross proceeds of $5.0 million and incurring issuance costs of approximately $7,000. In December 2018, the Company issued 390,320 shares of Series 2 Growth resulting in gross proceeds of $5.0 million. No issuance costs were incurred in conjunction with this issuance. In April 2019, the Company issued 390,320 shares of Series 2 Growth resulting in gross proceeds of $5.0 million. No issuance costs were incurred in conjunction with this issuance. Subsequently in April 2019, the Company issued 409,574 shares of Series 2 Growth resulting in gross proceeds of $5.2 million. No issuance costs were incurred in conjunction with this issuance. Series 3 Growth In December 2019, the Company entered into the Series 3 Growth Preferred Stock Purchase Agreement with current and new investors (the “Series 3 Growth Initial Purchasers”). In the December 2019 closing, the Series 3 Growth Initial Purchasers purchased 2,269,831 shares of Series 3 at an issuance price of $17.27 per share, resulting in gross proceeds of $39.2 million and incurred issuance costs of $0.3 million. As part of the Series 3 & 4 Growth Agreement certain Series 3 Growth Initial Purchasers agreed to purchase, 775,911 additional Series 3 Growth shares at $17.27 per share for aggregate proceeds of $13.4 million in subsequent closings (the “Series 3 Growth Tranche Rights”) (see Note 3). The fair value of the Series 3 Growth on the date of issuance was determined by the Company to be $17.09 per share with the assistance of a third-party valuation specialist. In April 2020, the Company issued 818,990 shares of Series 3 Growth resulting in gross proceeds of $14.1 million and incurring issuance costs of approximately $26,000. The issuance included 775,911 shares under the Series 3 Growth Tranche Rights. The Series 3 Growth Tranche Rights liability was remeasured to its estimated fair value immediately prior to settlement, resulting in $0.3 million of income being recorded in the consolidated statements of operations. The tranche issuance was the final Series 3 Growth tranche closing and resulted in the settlement of the remaining $0.1 million of Series 3 Growth Tranche Rights. In June 2020, the Company issued 1,158,077 shares of Series 3 Growth to CMS in conjunction with the CMS Bridging DMCC Licensing, Collaboration, and Investing Agreements (see Note 5) resulting in gross proceeds of $20.0 million and incurring issuance costs of $0.2 million. In August 2020, the Company issued 868,558 shares of Series 3 Growth resulting in gross proceeds of $15.0 million and incurring issuance costs of $0.1 million. Redeemable Convertible Preferred Stock Rights and Preferences On December 2, 2019, the Company filed its Twelfth Amended and Restated Certificate of Incorporation which amended the terms of the Company’s redeemable convertible preferred stock to designate Series A-1, Series A-2, Series A-3 and Series A-4 as Junior Preferred Stock, collectively, and Series A-5, Series Growth, Series 2 Growth, Series 3 Growth and Series 4 Growth as Senior Preferred, collectively, and together with the Junior Preferred, the Series Preferred. In addition, the Twelfth Amended and Restated Certificate of Incorporation designated Series Growth and Series 2 Growth as Junior Growth Preferred, collectively, and Series 3 Growth and Series 4 Growth as Senior Growth Preferred, collectively. Voting The holders of Series Preferred have full voting rights and powers equal to the rights and powers of holders of shares of common stock, with respect to any matters upon which holders of shares of common stock have the right to vote. Holders of Series Preferred are entitled to the number of votes equal to the number of whole shares of common stock into which such share of Series Preferred could be converted at the record date for determination of the stockholders entitled to vote on such matters. Holders of record of the shares of common stock and preferred stock, voting together as a single class, are entitled to elect the directors of the Company. Dividends Liquidation Preference Prepayment Dividends On June 27, 2012, the terms of the Series Preferred were amended. An 8% non-cumulative dividend payable when and if declared by the Board was replaced with a liquidation preference prepayment dividend (“Liquidation Preference Prepayment Dividend”). The Senior Growth Preferred Stock rank senior to the Junior Growth Preferred Stock, which rank senior to the Series A-5, which rank senior to the Junior Series Preferred Stock in the event of a Liquidation Preference Prepayment Dividend. The Board of Directors, which is controlled by Series 3 Growth holders at December 31, 2021, may elect to declare of the above designations of Series Preferred, one or more dividends equal to the liquidation preference of such shares, or any portion thereof, to the holders of such shares. If a liquidation preference prepayment dividend is paid, it would reduce the liquidation preference payable to the respective Series Preferred holders upon liquidation or deemed liquidation. Dividends subsequent to Liquidation Preference Prepayment Dividend After Liquidation Preference Prepayment Dividends have been paid in full and after the holders of common stock have received aggregate dividends per share equal to the lowest per share Liquidation Preference Prepayment Dividend, then the holders of Series Preferred will participate in any dividends declared on a pro rata basis with common stock. Liquidation Preference The Senior Growth Preferred Stock rank senior to the Junior Growth Preferred Stock, which rank senior to the Series A-5, which rank senior to the Junior Series Preferred Stock, which rank senior to Company’s common stock in the event of liquidation dissolution or winding-up of the Company. In the event of any liquidation, dissolution or winding-up of the Company, the holders of Senior Growth Preferred shall be entitled to receive, prior to any distributions being made to Junior Growth Preferred, Series A-5, Junior Preferred and common stock, an amount per share equal to one and one-half times (1.5x) the original issuance price ($17.27 and $20.72 per share for Series 3 Growth and Series 4 Growth, respectively) less any Liquidation Preference Prepayment Dividend paid for such shares of Senior Growth Preferred, plus any dividends declared but unpaid. If upon liquidation, dissolution or winding up of the Company, the assets available for distribution are insufficient to pay the Senior Growth Preferred the full amount to which they are entitled, the holders of Senior Growth Preferred share ratably in any distribution of the assets. After payment to holders of the Senior Growth Preferred, the Junior Growth Preferred, Series A-5, and Junior Series Preferred, each shall be entitled to receive, prior and in preference to any distribution of any of the assets of the Company to the holders of a lower ranking designation of stock an amount per share equal to the greater of (i) the applicable original issue price ($12.81, $12.41, $12.41, $3.77, $3.00, $2.61, and $4.44 per share for Series 2 Growth, Series Growth, Series A-5, Series A-4, Series A-3, Series A-2, and Series A-1, respectively), less any Liquidation Preference Prepayment Dividend paid for such shares of the respective designation of stock, plus any dividends declared but unpaid, or (ii) such amount per share as would have been payable had all shares of Series Preferred been converted into common stock immediately prior to such liquidation, dissolution or winding up, less any Liquidation Preference Prepayment Dividend paid for such shares of the respective designation of stock and after giving effect to any other applicable Liquidation Preference Prepayment Dividend. If upon liquidation, dissolution or winding up of the Company, the assets available for distribution are insufficient to pay the holders of a particular designation of stock the full amount to which they are entitled, the holders of the particular designation of stock share ratably in any distribution of the assets. In the event of any liquidation, dissolution or winding-up of the Company, after the Series Preferred liquidation payments have been made, the remaining assets for distribution shall be distributed among the holders of the Senior Growth Preferred and common stock pro rata based on the number of shares held by each Senior Growth Preferred and common stockholder, treating for this purpose all such securities as if they had converted to common stock. Redemption Modification of Senior Preferred Stock terms On February 28, 2018, the terms of the Senior Series Preferred were amended to add a redemption feature provided to holders of the Senior Preferred Stock. Shares of Senior Preferred Stock shall be redeemed by the Company, upon an elective redemption request by the investors on or after February 28, 2025, at a price equal to the greater of i) the conversion price per share, plus all declared but unpaid dividends thereon, and ii) the fair market value of a single share of each applicable series of Senior Preferred. Outstanding shares of Senior Preferred Stock shall be accreted to the redemption value at each reporting period, with the offset recorded to additional paid-in capital in the accompanying consolidated balance sheets. On December 2, 2019, the redemption date was amended to December 2, 2026. Conversion Each share of Series Preferred is convertible at the option of the holder at any time after issuance into the number of fully paid and nonassessable shares of common stock as determined by dividing the original issue price of each series of preferred stock by the conversion price of each series in effect at time of the conversion. The initial conversion price is the respective original issue price, subject to adjustment in accordance with the antidilution provisions of each series. Each Series Preferred will subject to automatic conversion into common stock in the event of either (i) a qualified initial public offering that results in minimum gross proceeds to the Company of $50.0 million and a price of at least $17.27 per share, or (ii) at the election of the holders of a majority of the then outstanding Series Preferred. Each share of Series Preferred will be automatically converted into one share of common stock at the then effective conversion rate, provided however that in the event of a qualified initial public offering, the holders of the Senior Growth Preferred Stock will be entitled to receive additional shares of common stock equal to one and one-half times (1.5x) the original issue price of the Senior Growth Preferred divided by the price per share of common stock offered in such initial public offering. Series A-3 may only be converted at the election of the holders of a majority of the then outstanding Series A-3 and the Board of Directors in its sole discretion if the conversion occurs following the payment in full of the Series Preferred Liquidation Preference Payment. At December 31, 2021, none of the outstanding shares of Series Preferred were converted into common stock. |
Common Stock
Common Stock | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Stockholder's Equity (Deficit) | 15. Stockholder’s 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 June 30, 2022 Legacy Redeemable Convertible Preferred Stock At December 31, 2021 and immediately prior to the Business Combination, Legacy Gelesis had outstanding Series A-1, Series A-2, Series A-3, Series A-4, Series A-5, Series Growth, Series 2 Growth and Series 3 Growth redeemable convertible preferred stock which are collectively referred to as “redeemable convertible preferred stock.” Immediately prior to the closing of the Business Combination, Legacy Gelesis redeemable convertible preferred stock converted into Legacy Gelesis common stock and was 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. 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 at 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 June 30, 2022, 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 rollover common stock warrants of the Company on a one-to-one basis. At close of Business Combination and June 30, 2022, there were 1,836,429 and 1,660,303 rollover warrants outstanding, respectively, with an exercise price of $0.02. During the six months ended June 30, 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 at June 30, 2022, respectively, there were 1,353,062 of these warrants outstanding with an exercise price of $4.26. At June 30, 2022 and December 31, 2021 common stock reserved for future issuances was as follows: June 30, December 31, 2022 2021 Common stock issued upon option exercise and RSUs vesting 20,000,493 13,486,708 Conversion of all classes of redeemable convertible preferred stock — 48,566,655 Issuances upon exercise of warrants to purchase Series A-4, upon conversion to common warrants — 1,836,429 Issuances upon exercise of common stock warrants 24,333,365 1,353,062 Earnout shares 23,482,845 — Total common stock reserved for future issuance 67,816,703 65,242,854 | NOTE 7. STOCKHOLDERS’ DEFICIT Preferred Stock Class A Common Stock Class B Common Stock Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, and any private placement-equivalent warrants issued to the Sponsor or its affiliates upon conversion of loans made to the Company). |
Gelesis | ||
Stockholder's Equity (Deficit) | 15. Common Stock The holders of the common stock are entitled to one vote for each share of common stock. Subject to the payment in full of all preferential dividends to which the holders of the preferred stock are entitled, the holders of common stock shall be entitled to receive dividends out of funds legally available. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, after the payment or provision for payment of all debts and liabilities of the Company and all preferential amounts to which the holders of preferred stock are entitled with respect to the distribution of assets in liquidation, the holders of common stock shall be entitled to share ratably in the remaining assets of the Company available for distribution. At December 31, 2021 and 2020 common stock reserved for future issuance was as follows: At December 31, 2021 2020 Common stock options and RSUs outstanding 5,203,174 5,034,858 Conversion of all classes of redeemable convertible preferred stock 18,736,936 18,446,525 Issuances upon exercise of warrants to purchase Series A-1, upon conversion to common warrants — 74,784 Issuances upon exercise of warrants to purchase Series A-3, upon conversion to common warrants — 238,189 Issuances upon exercise of warrants to purchase Series A-4, upon conversion to common warrants 708,493 708,493 Issuances upon exercise of common stock warrants 522,009 522,009 Total common stock reserved for future issuance 25,170,612 25,024,858 |
Stock-based Compensation_2
Stock-based Compensation | 6 Months Ended |
Jun. 30, 2022 | |
Stock-Based Compensation | 16. 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, 2,370,188 shares remained available for issuance at June 30, 2022. 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 four years 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): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Research and development $ 3,008 $ 494 $ 8,073 $ 1,061 Selling, general and administrative 4,968 1,145 13,892 2,033 Total $ 7,976 $ 1,639 $ 21,965 $ 3,094 Stock Option Activity The following table summarizes the Company’s stock option activity during the six months ended June 30, 2022: Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price per Contractual Intrinsic Value Options Share Term (Years) (in thousands) Outstanding at December 31, 2021 4,889,820 $ 10.39 6.17 $ 54,449 Retroactive application of reverse recapitalization 7,784,666 (6.38) Adjusted and Outstanding at December 31, 2021 12,674,486 $ 4.01 6.17 $ 54,449 Granted 2,658,185 $ 3.35 Exercised (162,064) $ 0.68 Forfeited - unvested (17,281) $ 5.56 Forfeited - vested (63,718) $ 4.31 Expired (456,534) $ 1.23 Outstanding at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 Exercisable at June 30, 2022 9,780,237 $ 3.81 5.43 $ 840 Vested and Expected to Vest at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 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 six months ended June 30, 2022 was $2.4 million. The fair value of each option issued was estimated at the date of grant using Black-Scholes with the following weighted-average assumptions: Six Month Ended June 30, 2022 Market price of common stock $ 3.35 Expected volatility 72.4 % Expected term (in years) 6.1 Risk-free interest rate 1.7 % Expected dividend yield 0.0 % The weighted-average grant date fair value of stock options granted during the six months ended June 30, 2022 was $2.17. At June 30, 2022 and December 31, 2021, there was $13.7 million and $8.7 million, respectively, of 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 2.4 and 2.2 years, respectively. Restricted Stock Unit (“RSU”) Activity The following table summarizes the Company’s RSU activity during the six months ended June 30, 2022: Weighted- Average Grant Date Number of RSUs Fair Value Outstanding and Unvested at December 31, 2021 313,354 $ 21.41 Retroactive application of reverse recapitalization 498,868 $ (13.15) Adjusted and Outstanding and Unvested at December 31, 2021 812,222 $ 8.26 Granted 4,555,197 $ 3.46 Vested (17,654) $ 8.26 Forfeited — Outstanding and Unvested at June 30, 2022 5,349,765 $ 4.18 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 or 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 June 30, 2022 and December 31, 2021, unrecognized compensation cost for RSU awards granted totaled $16.0 million and $6.7 million, respectively, which was expected to be recognized over a weighted-average period of 2.8 and 0.9 years, respectively. |
Income Taxes_2
Income Taxes | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
INCOME TAX | 17. Income Taxes The Company did not record a provision during the three months and the six months ended June 30, 2022 and June 30, 2021, respectively. The provision recorded differs from the US statutory rate of 21% for the three months and six months ended June 30, 2022 and June 30, 2021 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 June 30, 2022 and December 31, 2021, respectively. | NOTE 9 — INCOME TAX The Company’s net deferred tax assets are as follows: December 31, December 31, 2021 2020 Deferred tax assets (liabilities) Net operating loss carryforward $ 9,695 $ 36,961 Startup/Organizational expenses 488,923 472,542 Unrealized gain on marketable securities (4,382) (43,985) Total deferred tax assets 494,236 465,518 Valuation allowance (494,236) (465,518) Deferred tax assets, net of valuation allowance $ — $ — The income tax provision for the year ended December 31, 2021 and 2020 consists of the following: December 31, December 31, 2021 2020 Federal Current $ — $ — Deferred (28,719) (465,518) State and Local Current — — Deferred — — Change in valuation allowance 28,719 465,518 Income tax provision $ — $ — As of December 31, 2020 and December 31, 2021, the Company had $176,006 and $46,167 of federal net operating loss carryovers, respectively, which can be carried forward indefinitely, available to offset future taxable income. In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the year ended December 31, 2021, the change in the valuation allowance was $28,719. For the period from July 7, 2020 through December 31, 2020, the change in the valuation allowance was $465,518 . A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2021 and 2020 is as follows: December 31, 2021 December 31, 2020 Statutory federal income tax rate 21.0 % 21.0 % State taxes, net of federal tax benefit 0.0 % 0.0 % Business combination expense (33.19) % — Change in fair value of warrants 12.38 % 0.0 % Transaction costs incurred in connection with warrant liabilities — (0.0) % Valuation allowance (0.19) % (21.0) % Income tax provision 0.0 % 0.0 % The Company files income tax returns in the U.S. federal jurisdiction and is subject to examination by the various taxing authorities. The Company’s tax returns for the year ended December 31, 2021 and 2020 remain open to examination by the taxing authorities. The Company considers Texas to be a significant state tax jurisdiction. |
Gelesis | ||
INCOME TAX | 17. Income Taxes Consolidated (loss) income before income taxes on a geographic basis during the years ended December 31, 2021 and 2020 are as follows (in thousands): Year Ended December 31 2021 2020 United States $ (86,693) $ (19,658) Non-U.S. (6,637) (4,208) Total $ (93,330) $ (23,866) The provision for income taxes consists of the following components during the years ended December 31, 2021 and 2020 (in thousands): Year Ended December 31, 2021 2020 Current tax expense (benefit): U.S. federal $ — $ — Foreign 17 (24) Total current tax expense (benefit) 17 (24) Deferred tax expense: U.S. federal — — State — — Foreign — 2,063 Total deferred tax benefit — 2,063 Total provision for income taxes $ 17 $ 2,039 A reconciliation setting forth the differences between the effective tax rates of the Company for the years ended December 31, 2021 and 2020 and the U.S. federal statutory tax rate is as follows: Year Ended December 31, 2021 2020 U.S. Federal income tax provision expense at statutory rate 21.0 % 21.0 % Effect of nondeductible stock-based compensation 0.8 % (1.9) % Foreign rate differential 0.2 % 2.2 % Mark to market of warrant liabilities (1.7) % (1.3) % State taxes net of federal benefit 4.3 % 4.5 % Non-deductible financing expenses (0.3) % 0.4 % Valuation allowance (24.2) % (38.3) % Investment transfer 0.0 % 6.8 % Other differences (0.4) % (0.4) % US federal and state research credits 0.4 % 1.6 % Uncertain tax positions (0.1) % (1.1) % Foreign earnings includible in US 0.0 % (2.0) % Effective income tax rate 0.0 % (8.5) % Significant components of the Company’s consolidated deferred tax assets and liabilities at December 31, 2021 and 2020 are as follows at (in thousands): At December 31, 2021 2020 Deferred tax assets: Federal net operating loss carryforwards $ 40,469 $ 24,730 State net operating loss carryforwards 10,643 7,207 Equity compensation 5,620 4,353 Accruals and reserves — 26 Uncollected grants 998 712 Investment in subsidiaries 3,820 3,931 Research credits 1,578 1,298 Other assets 152 46 Deferred income 239 — Interest 257 — Deferred rent 547 600 Total deferred tax assets 64,323 42,903 Valuation allowance (59,841) (37,427) Total deferred tax assets net of valuation allowance 4,482 5,476 Deferred tax liabilities: Intangible assets and amortization (3,932) (4,680) Right-of-Use asset (536) (591) Other liabilities (14) (204) Total deferred tax liabilities (4,482) (5,476) Net deferred tax assets $ — $ — Deferred income taxes reflect the net tax effect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amount used for income tax purposes. At December 31, 2021 and 2020, the Company has federal net operating loss carryforwards totaling $184.6 million and $114.4 million, respectively, of which $63.5 million expire in 2027 through 2037 and $121.1 million do not expire. At December 31, 2021 and 2020, the Company has state net operating loss carryforwards totaling $168.4 million and $114.0 million, respectively, which expire in 2030 through 2041, as well as other temporary differences and attributes that will be available to offset regular taxable income during the carryforward period. At December 31, 2021, the Company has foreign net operating loss carryforwards of $7.1 million which do not expire. Under the provisions of the Internal Revenue Code, the net operating loss and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. Net operating loss and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code, respectively, as well as similar state provisions. This could limit the amount of tax attributes that can be utilized annually to offset future taxable income or tax liabilities. The amount of the annual limitation is determined based on the value of the Company immediately prior to the ownership change. Subsequent ownership changes may further affect the limitation in future years. The Company has not completed a change in control analysis, as defined under Sections 382 and 383 of the Internal Revenue Code, through December 31, 2021 and has not determined whether the future utilization of net operating loss carryforwards may be materially limited based upon past financings. In addition, the Company may complete future financings that could result in an ownership change, which may limit the Company’s ability to utilize its tax attributes. The Company files income tax returns in Italy, the United States and in various state jurisdictions with varying statutes of limitations. Due to net operating losses incurred, the Company’s tax returns from inception to date are subject to examination by taxing authorities. The Company has evaluated 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. Additionally, the Company has determined that it is not more likely than not that the Company will recognize the benefits of the net deferred tax assets in Italy, primarily due to uncertainty regarding continued funding of the operations of Italy and from the restructuring of the intercompany services agreement between Gelesis, Inc., and Gelesis S.r.l., in connection with the RIF financing (see Note 11). As a result, the Company recorded a deferred tax provision of approximately $2.0 million in Italy during the year ended December 31, 2020 to establish a full valuation allowance against the balance of net deferred tax assets in Italy and maintains a full valuation allowance against the balance of net deferred tax assets in Italy as of December 31, 2021. The Company will continue to evaluate all positive and negative evidence each period. The change in the valuation allowance during the years ended December 31, 2021 and 2020 was an increase of $22.4 million and $9.1 million, respectively. The increase in the valuation allowance during the year ended December 31, 2021 and 2020 primarily relates to an increase in net operating losses in both years as well as the establishment of a full valuation allowance in the Italian subsidiary during the year ended December 31, 2020. The Company generally considers all earnings generated in Italy to be indefinitely reinvested. Therefore, the Company does not accrue U.S. taxes on the repatriation of the foreign earnings it considers to be indefinitely reinvested outside of the U.S. At December 31, 2021, the Company had not provided for federal income tax on $7.5 million of accumulated undistributed earnings of its foreign subsidiaries. In the event the Company were to repatriate the foreign earnings, the Company does not estimate the repatriation being subject to taxation. The Company follows the provisions of ASC 740-10, Accounting for Uncertainty in Income Taxes, which specifies how tax benefits for uncertain tax positions are to be recognized, measured, and recorded in financial statements; requires certain disclosures of uncertain tax matters; specifies how reserves for uncertain tax positions should be classified on the balance sheet; and provides transition and interim period guidance, among other provisions. At December 31, 2021 and 2020, the Company has not recorded any liability for uncertain tax positions which relate primarily to certain federal and state research tax credits. The Company presents the uncertain tax positions as a reduction to the gross deferred tax assets with respect to research credits. The Company’s policy is to recognize interest and penalties accrued on any uncertain tax positions as a component of income tax expense, if any, in its consolidated statements of operations. For the years ended December 31, 2021 and 2020, no estimated interest or penalties were recognized on uncertain tax positions. The Company does not expect that the amounts of uncertain tax positions will change significantly within the next twelve months. A reconciliation of the beginning and ending amount of uncertain tax positions is as follows (in thousands): Year Ended December 31, 2021 2020 Unrecognized tax benefits at the beginning of year $ (281) $ — Increase for current year positions (71) (82) Increase for prior year positions — (199) Expiration of statute of limitations — — Unrecognized tax benefits at the end of year (352) (281) Gross research credit tax assets 1,930 1,579 Net research credit tax assets $ 1,578 $ 1,298 |
Earnings (Loss) per Share_2
Earnings (Loss) per Share | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Earnings (Loss) Per Share | 18. Earnings (Loss) per Share The weighted-average common shares outstanding and thus the net loss per share calculations and potentially dilutive security amounts for all periods prior to the Business Combination have been retrospectively adjusted to the equivalent number of shares outstanding immediately after the Business Combination to effect the reverse recapitalization. Historically reported weighted average shares outstanding have been multiplied by the exchange ratio of approximately 2.59. See Note 3 for further information. Basic and diluted loss per share attributable to common stockholders was calculated as follows: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net loss $ (12,513) $ (24,739) $ (18,216) $ (43,325) Accretion of redeemable convertible preferred stock to redemption value — (82,365) (37,934) (116,126) Accretion of noncontrolling interest put option to redemption value (85) (96) (173) (190) Net loss attributable to common stockholders $ (12,598) $ (107,200) $ (56,323) $ (159,641) Denominator: Weighted average common shares outstanding, basic and diluted 72,423,043 5,589,728 67,609,838 5,592,911 Net loss per share, basic and diluted $ (0.17) $ (19.18) $ (0.83) $ (28.54) 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 June 30, 2022 and 2021 from the computation of diluted net loss per share attributable to common stockholders because including them would have had an anti-dilutive effect. June 30, 2022 2021 Convertible preferred stock — 48,566,655 Warrants on convertible preferred stock — 1,836,429 Options and RSUs to acquire common stock 20,000,493 13,624,593 Warrants on common stock 24,333,365 1,353,062 Earnout shares — — Total 44,333,858 65,380,739 Total potentially dilutive common share equivalents for the three and six months ended June 30, 2022, excludes 23,482,845 shares related to the earnout liability as these shares are contingently issuable upon meeting certain triggering events. | |
Gelesis | ||
Earnings (Loss) Per Share | 18. Earnings (Loss) per Share Basic and diluted loss per share attributable to common stockholders were calculated as follows: December 31, 2021 2020 Numerator: Net loss $ (93,347) $ (25,905) Accretion of redeemable convertible preferred stock to redemption value (94,134) (11,372) Accretion of noncontrolling interest put option to redemption value (376) (567) Net loss attributable to common stockholders $ (187,857) $ (37,844) Denominator: Weighted average common shares outstanding, basic and diluted 2,204,486 2,149,182 Net loss per share, basic and diluted $ (85.22) $ (17.61) The Company’s potential dilutive securities, which include stock options, redeemable convertible preferred stock and warrants 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 December 31, 2021 and 2020 from the computation of diluted net loss per share attributable to common stockholders because including them would have had an anti-dilutive effect. December 31, 2021 2020 Convertible preferred stock 18,736,936 18,446,525 Warrants on convertible preferred stock 708,493 1,021,466 Options and RSUs to acquire common stock 5,203,174 5,074,547 Warrants on common stock 522,009 522,009 Total 25,170,612 25,064,547 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
COMMITMENTS | 19. 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. At June 30, 2022, the Company’s operating lease right of use assets was $1.7 million, of which $0.5 Future maturities of the lease liability under the Company’s noncancelable operating leases at June 30, 2022 are as follows (in thousands): At June 30, 2022 Remaining 2022 maturities $ 313 2023 629 2024 553 2025 383 2026 30 More than 5 years 15 Total undiscounted lease maturities $ 1,923 Imputed interest (151) Total lease liability $ 1,772 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 $18.3 million at June 30, 2022) 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 June 30, 2022, 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. Research and Development Tax Credits The Company’s subsidiary, Gelesis S.r.l., which conducts core manufacturing and research and development activities on behalf of the Company, is eligible to receive a non-income based and non-refundable tax credits for qualified research and development activities. The Company has earned research and development tax credits in Italy for qualifying expenses incurred by performing certain research and development activities. In December 2018, the Italian government passed a new budget law, effective January 1, 2019, that amended the eligibility criteria for recognizing qualifying research and development tax credits (“2019 Budget Law”). The 2019 Budget Law requires retroactive application for research and development tax credits earned during the year ended December 31, 2019. Under the 2019 Budget Law, research and development tax credits claimed in prior periods under previous interpretations of the research and development tax credit law may potentially be repaid by the Company. The Company evaluated the potential loss under ASC 450, Contingencies The Company has recorded $2.8 million and $3.0 million as a component of other long-term liabilities in the accompanying condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively. In October 2021, the Italian federal tax authority initiated an audit of the research and development tax credits for the calendar years 2017 through 2019. The Company expects that this tax audit will continue through 2022. Litigation In connection with the Business Combination, the Company received a litigation demand letter from certain purported stockholders alleging that the Company was required to provide holders of Class A Common Stock a separate class vote in connection with proposed amendments of the Company’s Amended and Restated Certificate of Incorporation to increase the number of authorized shares, such that separate votes can be cast on the proposed increase in the number of shares of Class A common stock and the proposed increase in the number of shares of preferred stock. During the six months ended June 30, 2022, the Company reached an agreement to resolve the claim and settled for an immaterial cash payment. | NOTE 6. COMMITMENTS Registration Rights Pursuant to a registration rights agreement entered into on July 1, 2020, the holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants or warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares) are entitled to registration rights requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to Class A common stock). The holders of the majority of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the expenses incurred in connection with the filing of any such registration statements. On the Closing Date, Gelesis Holdings, the Sponsor, certain former directors of CPSR (the “Director Holders”) and certain former stockholders of Legacy Gelesis (the “Legacy Gelesis Holders” and, collectively with Sponsor and the Director Holders, the “Holders”) entered into an Amended and Restated Registration and Stockholder Rights Agreement (the “Registration Rights Agreement”), pursuant to which, among other things, the Holders agreed not to effect any sale or distribution of any equity securities of Gelesis Holdings held by any of them during the lock-up period described in the B. Riley Registration Rights Agreement and Gelesis Holdings agreed to register for resale, pursuant to Rule 415 of the Securities Act, certain shares of Common Stock and other equity securities of Gelesis Holdings that are held by the parties thereto from time to time. Underwriting Agreement The underwriters are entitled to a deferred fee of $0.35 per Unit, or $9,660,000 in the aggregate. The deferred fee was paid by the Company at the Business Combination Closing. |
Gelesis | ||
COMMITMENTS | 19. Commitments and Contingencies Operating Leases The Company has operating leases for office, laboratory and manufacturing space with remaining terms between four and six years. Leases with initial terms of less than twelve months are not recorded as operating leases. The Company recognizes expenses for leases on a straight-line basis over the lease period and has accrued for lease expense incurred but not yet paid. While certain leases contain renewal options, the Company does not include renewal options in determining the term of the lease, used for calculating the associated lease liabilities, unless it is reasonably certain it will execute the renewal option. None of the Company’s leases include variable payments, residual value guarantees or restrictive covenants. In June 2019, the Company entered into an operating lease agreement with 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. At December 31, 2021, the Company’s operating lease right of use assets was $2.0 million, of which $0.5 million and $1.5 million were short-term and long-term lease liabilities, respectively. At December 31, 2020, the Company’s operating lease right of use assets was $2.2 million, of which $0.4 million and $1.8 million were short-term and long-term lease liabilities, respectively. Operating lease expense was $0.5 million during the years ended December 31, 2021 and 2020, respectively. The remaining noncancelable term of the Company’s operating leases was 3.7 years Future maturities of the lease liability under the Company’s noncancelable operating leases at December 31, 2021 are as follows (in thousands): At December 31, 2021 2022 $ 634 2023 639 2024 555 2025 385 2026 33 More than 5 years 16 Total undiscounted lease maturities $ 2,262 Imputed interest (202) Total lease liability $ 2,060 Royalty Agreements Expenses from royalty agreements on net product sales and sublicense income is recognized as a cost of goods sold in the accompanying 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 €17.5 million (approximately $19.9 million at December 31, 2021) upon the achievement of certain milestones and pay royalties on future sales and/or a percentage of sublicense income. At December 31, 2021, 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. Research and Development Tax Credits The Company’s wholly owned subsidiary, Gelesis S.r.l., which conducts core research and development activities on behalf of the Company, is eligible to receive a non-income based and non-refundable tax credits for qualified research and development activities. The Company has earned research and development tax credits in Italy for qualifying expenses incurred by performing certain research and development activities. For the years ended December 31, 2021 and 2020, less than $0.1 million and $0.6 million, respectively, were recorded as other income (expense), net in the accompanying consolidated statements of operations. In December 2018, the Italian government passed a new budget law, effective January 1, 2019, that amended the eligibility criteria for recognizing qualifying research and development tax credits (“2019 Budget Law). The 2019 Budget Law requires retroactive application for research and development tax credits earned during the year ended December 31, 2019. Under the 2019 Budget Law, research and development tax credits claimed in prior periods under previous interpretations of the research and development tax credit law may potentially be repaid by the Company. The Company evaluated the potential loss under ASC 450, Contingencies The Company has recorded $3.0 million and $3.1 million as a component of other long-term liabilities in the accompanying consolidated balance sheets at December 31, 2021 and 2020, respectively. In October 2021, the Italian federal tax authority initiated an audit of the research and development tax credits for the calendar years 2017 through 2019. The Company expects that this tax audit will continue into 2022. |
Related Party Transactions_2_3
Related Party Transactions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
RELATED PARTY TRANSACTIONS | 20. 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 19). With respect to the sublease, the Company incurred lease expense of $0.1 million and $0.1 million during the three months ended June 30, 2022 and 2021, respectively, and $0.3 million and $0.2 million during the six months ended June 30, 2022 and 2021, respectively, recorded in general and administrative expenses in the accompanying condensed consolidated statements of operations. The Company incurred royalty expense of $0.2 million and less than $0.1 million during the three months ended June 30, 2022 and 2021, respectively, and $0.3 million and $0.1 million in connection with the PureTech royalty agreement (see Note 19) during the six months ended June 30, 2022 and 2021, 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 $0.1 million and $0.1 million at June 30, 2022 and December 31, 2021, respectively, in the accompanying condensed consolidated balance sheets. On December 13, 2021, the Company issued a convertible promissory note to PureTech in the principal amount of $15.0 million (see Note 12). At December 31, 2021, the outstanding balance was $15.1 million, recorded at fair value in the accompanying condensed consolidated balance sheets. On January 19, 2022 the Company settled the convertible promissory notes in cash for principal plus accrued interest in the aggregate amount of $15.2 million. During the six months ended June 30, 2022, the Company recognized a loss of $0.1 million with respect to the change in fair value of the convertible promissory notes on the accompanying condensed consolidated statements of operations. SSD2 On December 13, 2021, the Company issued a convertible promissory note to SSD2, LLC in the principal amount of $12.0 million (see Note 12). At December 31, 2021, the outstanding balance was $12.1 million, recorded at fair value in the accompanying condensed consolidated balance sheets. On January 19, 2022 the Company settled the convertible promissory notes in cash for principal plus accrued interest in the aggregate amount of $12.1 million. During the six months ended June 30, 2022, the Company recognized a loss of less than $0.1 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 the three months ended June 30, 2022 and 2021, respectively, and $0.1 million during the six months ended June 30, 2022 and 2021, 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 June 30, 2022 and December 31, 2021, respectively, in the accompanying condensed consolidated balance sheets. Acquisition of One In connection with the amended and restated master agreement with One (see Note 11), the Company acquired a 10.0% equity interest in One in exchange for cash consideration. During the six months ended June 30, 2022 the Company made a payment of $2.9 million to One shareholders with respect to the acquisition. The Company had remaining undiscounted payments of €2.5 million and €5.0 million due to One at June 30, 2022 and December 31, 2021, respectively (approximately $2.6 million and $5.7 million due to One at June 30, 2022 and December 31, 2021, respectively). The balance at June 30, 2022 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 $0.2 million and $0.1 million with One (see Note 19) during the three months ended June 30, 2022 and 2021, respectively, and $0.3 million and $0.1 million during the six months ended June 30, 2022 and 2021, respectively, recorded in cost of goods sold in the accompanying condensed consolidated statements of operations. The Company had an accounts payable balance to One S.r.l. of $0.1 million and an accrued expense balance of $0.2 million at June 30, 2022 and an accrued expense balance of less than $0.1 million at December 31, 2021, 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 June 30, 2022 (see Note 11). In addition, the shareholders of RIF provided the Company with a loan for $18.4 million with a fixed interest rate of 6.35% per annum (see Note 12). | NOTE 5. RELATED PARTY TRANSACTIONS Founder Shares On February 26, 2020, the Sponsor purchased 5,750,000 shares of the Company’s Class B common stock (the “Founder Shares”) for an aggregate price of $25,000. On July 1, 2020, the Company effected a stock dividend of 1,150,000 shares, resulting in the Company’s initial stockholders holding an aggregate of 6,900,000 Founder Shares. The Founder Shares included an aggregate of up to 900,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. All share and per-share amounts have been retroactively restated to reflect the stock dividend. As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) subsequent to a Business Combination, (x) if the last sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Administrative Support Agreement The Company entered into an agreement, commencing on July 1, 2020 through the earlier of the Company’s consummation of a Business Combination and its liquidation, to pay an affiliate of the Sponsor a total of $10,000 per month for office space, utilities and secretarial and administrative support. For the year ended December 31, 2021, the Company incurred $120,000 in fees for these services. For the period from February 14, 2020 (inception) through December 31, 2020, the Company incurred and paid $60,000 in fees for these services. At December 31, 2021, the Company had $20,000 of such fees included in account payable and accrued expense in the consolidated balance sheets. Promissory Note — Related Party On February 14, 2020, the Sponsor agreed to loan the Company an aggregate of up to $250,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Promissory Note”). The Promissory Note was non-interest bearing and payable on the earlier of July 31, 2020 or the completion of the Initial Public Offering. The outstanding balance under the Promissory Note of $140,000 was repaid at the closing of the Initial Public Offering on July 7, 2020. Borrowings under the Promissory Note are no longer available. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor, or the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On March 3, 2021, the Sponsor committed to provide the Company an aggregate of $1,500,000 in loans for working capital purposes on an as needed basis. Such loans will be evidenced by a promissory note when issued. As of December 31, 2021 and 2020, there were no amounts outstanding under the Working Capital Loans. Sponsor Loan On July 28, 2021, the Sponsor committed to provide the Company an aggregate of $4,000,000 in loans for working capital purposes. These loans will be non-interest bearing, unsecured and will be repaid upon the consummation of a Business Combination. If the Company does not consummate a Business Combination, all amounts loaned to the Company in connection with these loans will be forgiven except to the extent that the Company has funds available to it outside of its Trust Account. As of December 31, 2021, there were no amounts outstanding under these loans. |
Gelesis | ||
RELATED PARTY TRANSACTIONS | 20. Related Party Transactions The Company had the following transactions with related parties: PureTech In June 2019, PureTech executed a sublease agreement with Gelesis (see Note 19). With respect to the sublease, the Company incurred lease expense of $0.5 million during each of the years ended December 31, 2021 and 2020, respectively, recorded in general and administrative expenses in the accompanying consolidated statements of operations. The Company incurred royalty expense of $0.2 million and less than $0.1 million in connection with the PureTech royalty agreement (see Note 19) during the years ended December 31, 2021 and 2020, respectively, recorded in cost of goods sold in the accompanying consolidated statements of operations. The Company had an accounts payable balance to PureTech of $0.1 million and less than $0.1 million at December 31, 2021 and 2020, respectively, in the accompanying consolidated balance sheets. On December 13, 2021, the Company issued a convertible promissory note to PureTech Health LLC in the principal amount of $15.0 million (see Note 12). At December 31, 2021, the outstanding balance was $15.1 million, recorded in notes payable in the accompanying consolidated balance sheets. The Company recorded a loss of less than $0.1 million within the consolidated statements of operations with respect to the change in fair value of the instrument. SSD2 On December 13, 2021, the Company issued a convertible promissory note to SSD2, LLC in the principal amount of $12.0 million (see Note 12). At December 31, 2021, the outstanding balance was $12.1 million, recorded in notes payable in the accompanying consolidated balance sheets. The Company recorded a loss of less than $0.1 million within the consolidated statements of operations with respect to the change in fair value of the instrument. One S.r.l Consulting Agreement with Founder of One In 2008, in connection with entering into a patent license and assignment agreement with One, the Company and one of the founders of One, who is also a stockholder of the Company, executed a consulting agreement for the development of the underlying intellectual property. The Company incurred costs for consulting services received from the founder totaling $0.3 million and $0.3 million during the years ended December 31, 2021 and 2020, respectively, recorded in research and development expense in the accompanying consolidated statements of operations. The Company recorded accrued expenses to the founder of less than $0.1 million at December 31, 2021 and 2020, respectively, in the accompanying consolidated balance sheets. Acquisition of One In connection with the amended and restated master agreement with One (see Note 11), Gelesis S.r.l., a VIE of the Company, acquired a 10.0% equity interest in One. During the year ended December 31, 2021 the Company made no payments to One shareholders with respect to the acquisition. During the year ended December 31, 2020, the Company made payments to One shareholders totaling $3.1 million with respect to the acquisition. The Company had remaining undiscounted payments of €5.0 million due to one at December 31, 2021 and December 31, 2020, respectively (approximately $5.7 million and $6.1 million due to One at December 31, 2021 and 2020, respectively). The balance at December 31, 2021 was recorded in accrued expenses in the accompanying consolidated balance sheets as it is expected to be settled within the next twelve months. Additionally, the Company incurred royalty expense of $0.2 million and less than $0.1 million in connection with the One royalty agreement (see Note 19) during the years ended December 31, 2021 and December 31, 2020, respectively, recorded in cost of goods sold in the accompanying consolidated statements of operations Company had recorded accrued expenses to One Srl of $0.1 million and $3.0 million at December 31, 2021 and 2020, respectively, in the accompanying 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 11). In addition, the shareholders of RIF provided the Company with a loan for $18.4 million with a fixed interest rate of 6.35% per annum (see Note 12). |
Employee Benefit Plan_2
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2021 | |
Gelesis | |
Employee Benefit Plan | 21. Employee Benefit Plan The Company has a 401(k) retirement plan in which substantially all U.S. employees are eligible to participate. Eligible employees may elect to contribute up to the maximum limits, as set by the Internal Revenue Service, of their eligible compensation. The Company made discretionary plan contributions of $0.2 million and $0.2 million during the years ended December 31, 2021 and 2020, respectively. |
Subsequent Event(s)_2
Subsequent Event(s) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
SUBSEQUENT EVENTS | 21. Subsequent Events The Company has evaluated subsequent events which may require adjustment to or disclosure in the condensed consolidated financial statements through the date of issuance of these condensed consolidated financial statements. Promissory Notes and Promissory Note Warrants On July 25, 2022 and August 4, 2022, the Company issued three term promissory notes in the aggregate principal amount of $25.0 million to existing investor CMS Bridging DMCC, an affiliate of CMS Medical Venture Investment (HK) Limited, and existing investors and related parties PureTech Health LLC and SSD2 LLC, for an aggregate cash purchase price of $25.0 million. Each of the promissory notes is unsecured and bears interest at a rate of 15% per annum or b business days CMS License Agreement Amendment and CMS Warrant On August 4, 2022, the Company entered into an amendment to the License, Collaboration and Supply Agreement, dated June 18, 2020, by and between the Company and CMS Bridging DMCC, an affiliate of CMS Medical Venture Investment (HK) Limited. Pursuant to the amendment, the one-time, non-refundable, and non-creditable regulatory approval milestone payment of $5.0 million provided for in the original agreement became immediately payable. In addition, the amendment expands the CMS Territory and provides that the minimum annual royalty term for CMS territory will commence January 2024 (rather than January 2022, as previously provided under the original agreement) and extend through the expiration date of the amended agreement. Upon execution of the amendment, the Company also issued to CMS a warrant to purchase up to 400,000 shares of common stock, par value $0.0001 per share, at an exercise price of $0.01 per share. The warrant expires on the date that is ten years from the date of issuance and is exercisable at any time from the date of issuance until the expiration date . One S.r.l. Amended Warrant Purchase Agreement On August 9, 2022, the Company entered into an amendment to the Warrant Purchase Agreement dated October 21, 2020, by and between the Company and the One S.r.l. warrantholders. Pursuant to the amendment, the Company deferred payment of the aggregate remaining purchase price under the patent license and assignment agreement and master agreement between the Company and One S.r.l., totaling Pursuant to the amendment, and in consideration for the deferral, the Company amended the exercise price of the One S.r.l. warrantholders’ 1,353,062 previously issued common stock warrants from $4.26 to $1.45. Committed Equity Facility with B. Riley Principal Capital II, LLC On August 11, 2022, the Company entered into a Common Stock Purchase Agreement and a Registration Rights Agreement with B. Riley Principal Capital II, LLC (“B. Riley”). Pursuant to the agreement, the Company will have the right, but not the obligation, to sell to B. Riley up to the lesser of (i) $50,000,000 of newly issued shares of common stock, and (ii) 14,506,475 shares of common stock (which is the number of shares equal to approximately 19.99% of the aggregate number of shares of the Company's common stock issued and outstanding immediately prior to the execution of the agreement), from time to time during the 24-month term set forth in the agreement. | NOTE 11. SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the consolidated financial statements were issued. Based upon this review, other than the below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the consolidated financial statements. On January 13, 2022 the Company completed its Business Combination with Legacy Gelesis. |
Gelesis | ||
SUBSEQUENT EVENTS | 22. Subsequent Event(s) The Company has evaluated subsequent events which may require adjustment to or disclosure in the consolidated financial statements through the date of issuance of these consolidated financial statements. Business Combination On January 13, 2022, CPSR, a Delaware corporation and the predecessor company consummated the previously announced business combination, pursuant to the terms of the business combination agreement, dated as of July 19, 2021 (as amended on November 8, 2021 and December 30, 2021). The business combination, together with the PIPE financing and the sale of the backstop purchase shares, generated approximately $105 million in gross proceeds. In connection with the business combination, all outstanding shares of Legacy Gelesis’ Redeemable Convertible Preferred Stock and Legacy Gelesis’ Warrants Exercisable for Redeemable Convertible Preferred Stock converted into Gelesis Holdings Common Stock and Gelesis Holdings Common Warrants, respectively, pursuant to an exchange ratio of 2.59. On January 14, 2022, certain of the Gelesis Holdings’ securities began trading on the New York Stock Exchange under the symbols “GLS” and “GLS.W”. 2021 Bridge Financing Settlement On January 19, 2022, pursuant to the terms of the bridge financing arrangements with two existing investors, the Company settled the convertible promissory notes in cash for principal plus accrued interest in the aggregate amount of $27.3 million. |
Summary of Significant Accou_12
Summary of Significant Accounting Policies (Policies) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Basis of Presentation | Basis of Presentation The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). The Company consolidates those entities where it has a direct and indirect controlling financial interest based on either a variable interest model or voting interest model. 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. The noncontrolling interest attributable to the Company’s VIE is presented as a separate component from stockholders’ equity (deficit) in the condensed consolidated balance sheets and as a noncontrolling interest in the condensed consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholders’ equity. All intercompany balances and transactions have been eliminated in consolidation. Under the variable interest model, a controlling financial interest is determined based on which entity, if any, has (i) the power to direct the activities of the VIE that most significantly impacts the VIE’s economic performance and (ii) the obligations to absorb losses that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. The consolidation status of a VIE may change as a result of such reassessments. Changes in consolidation status are applied prospectively in accordance with U.S. GAAP. | Basis of Presentation The accompanying consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). |
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. | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. One of the more significant accounting estimates included in these consolidated financial statements is the determination of the fair value of the warrant liabilities. Such estimates may be subject to change as more current information becomes available and, accordingly, the actual results could differ significantly 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. | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The guidance in FASB ASC 820, Fair Value Measurements and Disclosures 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, and call option liability 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: 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: One S.r.l. Call Option: | |
Cash Equivalents | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2021 and 2020. | |
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. | |
Income Taxes | Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the consolidated financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The effective tax rates differ from the statutory tax rate for the periods presented primarily due to the change in warrant valuation and the valuation allowance recorded on the Company’s net operating losses. ASC 740 prescribes a recognition threshold and a measurement attribute for the consolidated financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. | |
Concentration of Credit Risk and Major Sales Channels | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Corporation coverage limit of $250,000. The Company has not experienced losses on this account. | |
Earnings (Loss) per Share | Net Loss Per Common Share The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. The Company has two classes of common stock, which are referred to as Class A common stock and Class B common stock. Income and losses are shared pro rata between the two classes of common stock. Net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. Remeasurement associated with the redeemable shares of Class A common stock is excluded from loss per common share as the redemption value approximates fair value. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 21,320,000 shares in the calculation of diluted loss per share, since the exercise of the warrants is contingent upon the occurrence of future events. As of December 31, 2021 and 2020, the Company did not have any other dilutive securities or other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company. As a result, diluted net loss per common share is the same as basic net loss per common share for the periods presented. The following table reflects the calculation of basic and diluted net loss per common share (in dollars, except per share amounts): For the Period from February 14, 2020 (Inception) Through Year Ended December 31, December 31, 2021 2020 Class A Class B Class A Class B Basic and diluted net loss per common share Numerator: Allocation of net loss, as adjusted $ (10,318,466) $ (2,579,616) $ (10,719,238) $ (4,575,622) Denominator: Basic and diluted weighted average stock outstanding 27,600,000 6,900,000 15,218,692 6,496,262 Basic and diluted net loss per common share $ (0.37) $ (0.37) $ (0.70) $ (0.70) | |
Recently Adopted Accounting Pronouncements | Recent Accounting Standards In August 2020, the FASB issued ASU No. 2020-06, “Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s consolidated financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s consolidated financial statements. | |
Gelesis | ||
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). The Company consolidates those entities where it has a direct and indirect controlling financial interest based on either a variable interest model or voting interest model. The Company’s 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. The noncontrolling interest attributable to the Company’s VIE is presented as a separate component from stockholders’ deficit in the consolidated balance sheets and as a noncontrolling interest in the consolidated statements of noncontrolling interest, redeemable convertible preferred stock and stockholders’ deficit. All intercompany balances and transactions have been eliminated in consolidation. Under the variable interest model, a controlling financial interest is determined based on which entity, if any, has (i) the power to direct the activities of the VIE that most significantly impacts the VIE’s economic performance and (ii) the obligations to absorb losses that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. The consolidation status of a VIE may change as a result of such reassessments. Changes in consolidation status are applied prospectively in accordance with U.S. GAAP. | |
Use of Estimates | Use of Estimates The preparation of 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 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 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 financial statements were filed with the Security and Exchange Commission (“SEC”) or were available to be issued. | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The guidance in FASB ASC 820, Fair Value Measurements and Disclosures 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 tranche rights liability, preferred stock warrants, and call option liability (see Notes 3 and 11) 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 below (see Note 3). Preferred Stock Warrant Liability: Tranche Rights Liability: Distinguishing Liabilities from Equity Noncontrolling Interests: investment in the former subsidiary will be initially measured at fair value and the difference between the carrying value and fair value of the retained interest will be recorded as a gain or loss. | |
Cash Equivalents | Cash Equivalents The Company considers all short-term, highly liquid investments with original maturities of 90 days or less at acquisition date to be cash equivalents. Cash equivalents, which consist of money market accounts purchased with original maturities of less than 90 days from the date of purchase, are stated at fair value. | |
Marketable Securities | Marketable Securities The Companies classifies all investment securities as available-for-sale, as the sale of such securities may be required prior to maturity. These investment securities are carried at fair value, with unrealized gains and losses reported as accumulated other comprehensive loss until realized. The cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization and accretion, as well as interest, are included in interest income. Realized gains and losses from sale of available-for-sale securities, if any, are determined on a specific identification basic and are also included in interest income. The Company reviews all available-for-sale securities at each period end to determine if they remain available-for-sale based on then current intent and ability to sell the security if it is required to do so. Marketable securities are subject to a periodic impairment review. The Company may recognize an impairment charge when a decline in the fair value of investments below the cost basis is determined to be other-than-temporary. The Company did not have any marketable securities deemed to be impaired at December 31, 2020 and did not have any marketable securities at December 31, 2021. | |
Accounts Receivable | Accounts Receivable The Company extends credit to customers based upon contractual terms or its evaluation of the customer’s financial condition. Customer accounts receivable are stated at amounts due net of applicable discounts and other contractual adjustments as well as an allowance for expected credit losses. The Company assesses the need for an allowance for expected credit losses based upon currently expected credit losses (“CECL”) by considering a number of factors, including the length of time trade accounts receivable are past due, the customer’s ability to pay its obligation and the condition of the general economy and the industry as a whole. The Company will write off accounts receivable when the Company determines that they are uncollectible. The Company has not historically experienced any collection issues or significant credit losses. Based on historical receipts and collections history, management has determined that an allowance for expected credit losses is not necessary at December 31, 2021 or 2020. | |
Government Grants | Government Grants The Company recognizes grants from governmental agencies in other income on the consolidated statements of operations, gross of the expenditures that were related to the underlying project being co-funded by the grant, when there is reasonable assurance that the Company will comply with the conditions attached to the grant arrangement and payments under the grant will be received. The Company evaluates the conditions of each individual grant as of each reporting period to ensure that the Company has reached reasonable assurance of meeting the conditions of each grant arrangement and that it is expected that the grant payment will be received as a result of meeting the necessary conditions. The Company has been awarded grants from government agencies in Italy for certain capital expenditures and expenses incurred for research and development work performed under specified programs conducted in Italy. The Company submits qualifying expenses and capital purchases for reimbursement under each specified program, which occurs after the Company has made the capital purchases and/or incurred the research and development costs. The Company records a grant receivable upon incurring such expenses, as approval and reimbursement are considered to be perfunctory once the qualifying program has been approved. Government grants are recognized in the consolidated statements of operations on a systematic basis over the periods in which the Company recognizes the related costs for which the government grant is intended to compensate. Specifically, grant income related to research and development costs is recognized as such expenses are incurred. Research and development costs that were incurred prior to the approval of a qualifying program are recognized as grant income immediately upon approval of the program by the grantor. Grant income related to qualifying capital purchases is recognized in proportion to the depreciation expense incurred on the underlying assets. Deferred income related to capital purchases for which grant income will be recognized beyond twelve months from the balance sheet date is classified as long-term deferred income on the consolidated balance sheets and amortized to other income, net, over the same life of the related asset. | |
Inventory | Inventory The Company manufactures its own super-absorbent hydrogels used in Plenity® and other product candidates out of its own manufacturing facilities located in Italy. The packaging of the hydrogels is currently outsourced to contract packaging organizations for commercial and research and development purposes. Inventories comprise raw materials, including raw materials for packaging components, work-in-process, and finished goods, which are goods that are available for sale. The Company states inventory at the lower of cost or net realizable value with the cost based on the first-in, first-out method. If the Company identifies excess, obsolete or unsalable items, it writes down its inventory to its net realizable value in the period in which the impairment is identified. These adjustments are recorded based upon various factors related to the product, including the level of product manufactured by the Company, the level of product in the distribution channel, current and projected demand, the expected shelf-life of the product and firm inventory purchase commitments. Significant shipping and handling costs incurred for inventory purchases are included in inventory and costs incurred for product shipments are recorded in cost of goods sold as incurred. | |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, less accumulated depreciation. Expenditures for maintenance and repairs are charged to operations as incurred whereas major betterments are capitalized as additions to property and equipment. Depreciation and amortization begin at the time the asset is placed in service, and are recorded using the straight-line method over the estimated useful lives, as follows: Asset Category Useful Lives Computer equipment and software 1 – 3 years Laboratory and manufacturing equipment 2.5 – 8.3 years Leasehold improvements 5 – 10 years, or the remaining term of lease, if shorter Buildings and land improvements 18 – 20 years Land Not depreciated | |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. When such events occur, the Company compares the carrying amounts of the assets to the undiscounted expected future cash flows the assets are expected to generate and recognizes an impairment loss equal to the excess of the carrying value over the fair value of the related asset. For the years ended December 31, 2021 and 2020, there were no indicators of impairment. | |
Intangible Assets | Intangible Assets Intangible assets with estimable useful lives, or definite-lived intangibles, are carried at cost and are amortized on a straight-line basis over their estimated useful lives and reviewed for impairment upon certain triggering events. We routinely review the remaining estimated useful lives of definite-lived intangible assets. If we reduce the estimated useful life assumption, the remaining unamortized balance is amortized over the revised estimated useful life. | |
Redeemable Convertible Preferred Stock | Redeemable Convertible Preferred Stock The Company has classified redeemable convertible preferred stock as temporary equity in the consolidated balance sheets due to certain change in control clauses that are outside of the Company’s control, including liquidation, sale, or transfer of control of the Company, as holders of the redeemable convertible preferred stock could cause redemption of the shares in these situations. The Company accretes the carrying values of the classes of redeemable convertible preferred stock that are mandatorily redeemable to the redemption values. The Company does not accrete the carrying values of the classes of redeemable convertible preferred stock that are not mandatorily redeemable to the redemption values since a liquidation event, sale, or transfer is not considered probable. Subsequent adjustments of the carrying values to the ultimate redemption values will be made only if and when it becomes probable that such a liquidation event will occur. | |
Leases | Leases The Company determines if an arrangement is a lease at contract inception under ASC 842 — Leases The Company has elected to apply the practical expedient to account for lease and non-lease components as a single lease component for new and modified leases commencing after adoption election. The Company has also elected not to recognize leases with an initial term of 12 months or less on the consolidated balance sheets, instead, those lease payments are recognized in the consolidated statements of operations on a straight-line basis over the lease term. | |
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 adjust the corresponding product warranty reserves and liabilities at least quarterly and at the end of each reporting period. License and Collaboration Revenues The Company recognizes revenue from product sales and collaboration arrangements in accordance with ASC 606, Revenue from Contracts with Customers Performance obligations are promised goods or services in a contract to transfer a distinct good or service to the customer and are considered distinct when (i) the customer can benefit from the good or service on its own or together with other readily available resources and (ii) the promised good or service is separately identifiable from other promises in the contract. In assessing whether promised goods or services are distinct, the Company considers factors such as the stage of development of the underlying intellectual property, the capabilities of the customer to develop the intellectual property on its own or whether the required expertise is readily available, and whether the goods or services are integral or dependent to other goods or services in the contract. For performance obligations which consist of the Company’s materials, shipping and distribution activities occur prior to the transfer of control of the Company’s materials and are considered activities to fulfill the Company’s promise to deliver goods to the customers. The Company has entered and anticipates to enter future license, collaboration and/or distribution agreements, which are within the scope of ASC 606, to manufacture and commercialize product(s). The terms of these agreements typically contain multiple promises or obligations, which may include: (i) manufacturing and supply of covered products, and (ii) regulatory support activities to be provided to the collaboration partner relating to the covered product(s). Payments to the Company under these agreements may include payments based upon the achievement of certain milestones and royalties on any resulting net product sales. The Company first evaluates collaboration arrangements to determine whether the arrangement (or part of the arrangement) represents a collaborative arrangement pursuant to ASC Topic 808, Collaborative Arrangements, Amounts received prior to revenue recognition are recorded as deferred income. Amounts expected to be recognized as revenue within the twelve months following the balance sheet date are classified as current portion of deferred income in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the twelve months following the balance sheet date are classified as deferred income, net of current portion. Amounts recognized as revenue, but not yet received or invoiced are generally recognized as contract assets. | |
Cost of goods sold | Cost of goods sold Cost of goods sold includes the cost of manufacturing our proprietary superabsorbent hydrogels for Plenity for which revenue was recognized during the period, as well as the associated costs for encapsulation, packaging, shipment, supply management and quality assurance. Expenses from royalty agreements on net product sales are also recognized as a component of cost of goods sold during the period in which the associated revenues are recognized. A portion of depreciation with respect to property and equipment directly utilized in manufacturing Plenity units is recognized as a component of cost of goods sold over the depreciable life of the asset. | |
Selling, General and Administrative Costs | Selling, General and Administrative Costs Selling, general and administrative costs are expensed as incurred. Selling, general and administrative costs include sales and marketing costs incurred as a result of the commercialization of the Company’s products, payroll and personnel expense, stock-based compensation expense, and costs of programs and infrastructure necessary for the general conduct of the Company’s business. | |
Research and Development Costs | Research and Development Costs Research and development costs are expensed as incurred. Research and development costs include payroll and personnel expense, stock-based compensation expense, consulting costs, external contract research and development expenses, as well as depreciation and utilities. Prepaid research and development costs are deferred and amortized over the service period, as the services are provided. | |
Stock-Based Compensation | Stock-Based Compensation Effective January 1, 2020, the Company accounts for all stock-based compensation awards granted to employees and non-employees in accordance with ASC 718, Compensation — Stock Compensation ● exercise price: In determining the exercise prices for options granted, the Board of Directors has considered the fair value of the common stock as of each grant date. The fair value of the common stock underlying the stock options has been determined by the Board of Directors at each award grant date based upon the estimated fair value of the Company’s common stock as determined by an independent third-party valuation firm. The specialists at this valuation firm considered a variety of factors including the Company’s financial position and historical financial performance, the status of technological developments within the Company’s products, the composition and ability of the current clinical and management team, an evaluation or benchmark of the Company’s competition, the current business climate in the marketplace, the illiquid nature of the common stock, arm’s length sales of the Company’s capital stock (including Series Preferred), the effect of the rights and preferences of the preferred stockholders, and the prospects of a liquidity event, among others. ● expected volatility: As the Company is 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. Prior to the adoption of Accounting Standards ASU No. 2018-07, Compensation — Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting awards was generally the date the services were completed, resulting in financial reporting period adjustments to stock-based compensation during the vesting terms for changes in the fair value of the awards. Since the adoption of ASU 2018-07 on January 1, 2020, 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 consolidated statements of operations based on the function to which the related services are provided. Forfeitures are recorded as they occur. | |
Income Taxes | Income Taxes The consolidated financial statements reflect provisions for federal, state, local and foreign income taxes. Deferred tax assets and liabilities are recognized based on temporary differences between the financial reporting and income tax basis of assets and liabilities using rates anticipated to be in effect when such temporary differences reverse. A change in tax rates is recognized in income in the period of the enactment date. A valuation allowance against net deferred tax assets is required if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company also assesses the probability that the positions taken or expected to be taken in its income tax returns will be sustained by taxing authorities. A “more likely than not” (more than 50%) recognition threshold must be met before a tax benefit can be recognized. Tax positions that are more likely than not to be sustained on examination by the taxing authorities, based on the technical merits of the position, are reflected in the Company’s consolidated financial statements. Tax positions are measured as the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The difference between the benefit recognized for a position and the tax benefit claimed on a tax return is referred to as an unrecognized tax benefit. Potential interest and penalties associated with such uncertain tax positions are recorded as a component of income tax expense. | |
Foreign Currency Translation | Foreign Currency Translation The financial statements of each of the Company’s subsidiaries with a functional currency other than the U.S. dollar are translated into U.S. dollars using period-end exchange rates for assets and liabilities, historical exchange rates for stockholders’ equity and weighted average exchange rates for operating results. Translation gains and losses are included in accumulated other comprehensive income (loss) in stockholders’ equity. Foreign currency transaction gains and losses are included in other (expense) income, net in the results of operations. | |
Concentration of Credit Risk and Major Sales Channels | Concentrations of Credit Risk and Off -Balance-Sheet Risk The Company has no significant off-balance-sheet risk such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially expose the Company to concentrations of credit risk primarily consist of cash and cash equivalents, investments, accounts receivable and unbilled account receivables. The Company’s cash balances, trade receivables, and grants receivable subject the Company to significant concentrations of credit risk. Periodically, the Company maintains deposits in government insured financial institutions in excess of government insured limits. The Company deposits its cash in financial institutions that it believes have high credit quality and has not experienced any losses on such accounts and does not believe it is exposed to any significant credit risk on cash. The Company’s grants receivable are due from government agencies, which the Company believes to have high credit quality. The Company has a limited number of commercial customers. The Company monitors the creditworthiness of customers to whom it grants credit terms and has not experienced any credit losses. | |
Earnings (Loss) per Share | Earnings (Loss) per Share The Company computes basic earnings (loss) per share by dividing income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding. During periods of income, the Company allocates participating securities a proportional share of income determined by dividing total weighted average participating securities by the sum of the total weighted average common shares and participating securities (the “two-class method”). The Company’s restricted stock and various series of preferred stocks participate in dividends declared by the Company and are therefore considered to be participating securities. Participating securities have the effect of diluting both basic and diluted earnings per share during periods of income. During periods of loss, the Company allocates no loss to participating securities because they have no contractual obligation to share in the losses of the Company. The Company computes diluted earnings (loss) per share after giving consideration to the dilutive effect of stock options and warrants that are outstanding during the period, except where such non-participating securities would be anti-dilutive. | |
Segment Information | Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision-making group, in making decisions on how to allocate resources and assess performance. The Company’s chief operating decision maker is the chief executive officer. The Company and the chief operating decision maker view the Company’s operations and manage its business as one operating segment. Geographically, the Company operates out of the U.S. and Italy. The corporate headquarters including the core functions of sales and marketing, medical affairs, research and development and general and administrative are located in the U.S., while substantially all of the Company’s manufacturing facilities and operations physically reside in Italy. | |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements Credit Losses In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13). The FASB has subsequently issued amendments to ASU 2016-13, which have the same effective and transition date of fiscal years beginning after December 15, 2019 for SEC filers other than small reporting companies, and fiscal years beginning after December 15, 2022 for all other entities. These standards require that credit losses be reported using an expected losses model rather than the incurred losses model that is currently used, and establish additional disclosures related to credit risks. For available-for-sale debt securities with unrealized losses, these standards now require allowances to be recorded instead of reducing the amortized cost of the investment. The Company has adopted ASU No. 2016-13 as of January 1, 2021 and the impact of this standard was not material to the Company’s consolidated financial statements or related disclosures. |
Summary of Significant Accou_13
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Gelesis | |
Schedule of estimated useful lives of property and equipment | Asset Category Useful Lives Computer equipment and software 1 – 3 years Laboratory and manufacturing equipment 2.5 – 8.3 years Leasehold improvements 5 – 10 years, or the remaining term of lease, if shorter Buildings and land improvements 18 – 20 years Land Not depreciated |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Schedule of Liabilities Measured at Fair Value on Recurring Basis | Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at June 30, 2022 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Earnout liability (See Note 14) $ 6,190 $ — $ — $ 6,190 Private placement warrant liability (see Note 13) 1,130 — — 1,130 One S.r.l. call option (see Note 11) 3,062 — — 3,062 Total liabilities measured at fair value $ 10,382 $ — $ — $ 10,382 Liabilities that are measured at fair value on a recurring basis, and the level of the fair value hierarchy utilized to determine such fair values, consisted of the following at December 31, 2021 (in thousands): Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Convertible promissory notes (see Note 12) $ 27,128 $ — $ — $ 27,128 Legacy Gelesis preferred stock warrants (See Note 13) 15,821 — — 15,821 One S.r.l. call option (see Note 11) 2,416 — — 2,416 Total liabilities measured at fair value $ 45,365 $ — $ — $ 45,365 | December 31, 2021 December 31, 2020 Risk free rate 1.26 % 0.47 % Expected term 5.04 5.76 Dividend yield 0.00 % 0.00 % Expected volatility 24.28 % 19.0 % Exercise price $ 11.50 $ 11.50 Unit Price $ 9.96 $ 10.15 |
Schedule of the financial instruments, measured at fair value, by level within the fair value hierarchy on recurred basis | Description Level December 31, 2021 December 31, 2020 Assets Cash and marketable securities held in Trust Account 1 $ 276,207,207 $ 276,209,453 Liabilities: Warrant Liability — Public Warrants 1 $ 8,964,000 $ 19,458,000 Warrant Liability — Private Placement Warrants 3 $ 13,805,441 $ 10,643,808 | |
Gelesis | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Schedule of Liabilities Measured at Fair Value on Recurring Basis | Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Liabilities: Convertible promissory notes (see Note 12) $ 27,128 $ — $ — $ 27,128 Preferred stock warrants 15,821 — — 15,821 One Srl call option (see Note 11) 2,416 — — 2,416 Total liabilities measured at fair value $ 45,365 $ — $ — $ 45,365 | |
Schedule of the financial instruments, measured at fair value, by level within the fair value hierarchy on recurred basis | Fair Value Measurements Quoted Prices Significant in Active Other Significant Markets for Observable Unobservable Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) Assets: Marketable securities $ 23,998 $ 23,998 $ — $ — Total assets measured at fair value $ 23,998 $ 23,998 $ — $ — Liabilities: Preferred stock warrants $ 12,099 $ — $ — $ 12,099 One Srl call option (see Note 11) 1,545 — — 1,545 Total liabilities measured at fair value $ 13,644 $ — $ — $ 13,644 | |
Schedule of probabilities of scenarios occurring | At December 31, 2021 2020 IPO scenario 2.5 % 75.0 % Market adjusted equity value method 2.5 % 25.0 % Special purpose acquisition company (“SPAC”) scenario 95.0 % 0.0 % | |
Schedule of changes to company's tranche right liability | Tranche rights liability Balance at December 31, 2019 $ 310 Change in fair value of tranche rights liability immediately prior to tranche settlement in April 2020 (256) Settlement of Series 3 Growth tranche rights liability in April 2020 (54) Balance at December 31, 2020 $ — | |
Schedule of changes to company's warrant liability | Series 3 Series 4 Series A-1 Series A-3 Series A-4 Growth Growth Warrants Warrants Warrants Warrants Options Total Balance at December 31, 2019 485 2,541 7,686 4,631 653 15,996 Issuance of Series 4 Growth option liability — — — — 745 745 Extinguishment of Series 3 Growth warrant — — — (5,973) — (5,973) Exercise of Series A-4 warrants — — (135) — — (135) Change in fair value of warrant liability 96 355 1,071 1,342 (1,398) 1,466 Balance at December 31, 2020 $ 581 $ 2,896 $ 8,622 $ — $ — $ 12,099 Exercise of warrants (937) (2,987) — — — (3,924) Change in fair value of warrant liability 356 91 7,199 — — 7,646 Balance at December 31, 2021 $ — $ — $ 15,821 $ — $ — $ 15,821 | |
Schedule of weighted average assumptions used to determine the fair value of the warrant liability | The following weighted average assumptions were used to determine the fair value of the warrant liability at December 31, 2021: Series A-4 Warrants Expected term 0.1 years Expected volatility 48.0 % Expected dividend yield 0.0 % Risk free interest rate 0.6 % Estimated fair value of the redeemable convertible preferred stock $ 22.36 Exercise price of warrants $ 0.04 The following weighted average assumptions were used to determine the fair value of the warrant liability at December 31, 2020: Series A-1 Series A-3 Series A-4 Warrants Warrants Warrants Expected term 0.3 years 1.5 years 2.6 years Expected volatility 48.0 % 68.0 % 59.0 % Expected dividend yield 0.0 % 0.0 % 0.0 % Risk free interest rate 0.1 % 0.1 % 0.2 % Estimated fair value of the redeemable convertible preferred stock $ 12.24 $ 12.21 $ 12.22 Exercise price of warrants $ 4.44 $ 0.04 $ 0.04 | |
Schedule of changes to company's call option liability | Fair value of One Srl call option $ 1,494 Foreign currency translation loss 51 Balance at December 31, 2020 $ 1,545 Change in fair value 1,024 Foreign currency translation gain (153) Balance at December 31, 2021 $ 2,416 | |
Gelesis | Convertible promissory notes | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Schedule of weighted average assumptions used to determine the fair value of the warrant liability | The following assumptions were used to determine the fair value of the convertible promissory notes at December 31, 2021: Convertible Promissory Notes Expected term 0.1 years Discount rate 36.3 % Probability of repayment after close of business combination 95.0 % Probability of holder electing conversion option 5.0 % | |
Gelesis | Call Option | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Schedule of weighted average assumptions used to determine the fair value of the warrant liability | At December 31, 2021 2020 Expected term 2.0 years 1.8 years Expected volatility 62.0 % 61.0 % Expected dividend yield 0.0 % 0.0 % Risk free interest rate 0.7 % 0.1 % Estimated fair value of ownership interest $ 6,922 $ 6,066 Exercise price of call option $ 6,806 $ 7,358 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Gelesis | |
Marketable Securities | Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Fair Value Marketable securities: Commercial paper $ 15,999 $ 1 $ (2) $ 15,998 United States Treasury securities 8,000 — — 8,000 Total marketable securities $ 23,999 $ 1 $ (2) $ 23,998 |
Product Revenue, Reserve and Al
Product Revenue, Reserve and Allowance (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Summary of Activity in Product Revenue Reserve and Allowance | The following table summarizes the activity in the product revenue reserve and allowance during the six months ended June 30, 2022 and 2021 (in thousands): 2022 2021 Balance at December 31, $ 82 $ 14 Provision related to product sales 1,193 326 Credits and payments made (1,154) (324) Balance at June 30, $ 121 $ 16 | |
Gelesis | ||
Summary of Activity in Product Revenue Reserve and Allowance | Product Revenue Reserves Balance at December 31, 2019 $ — Provision related to product sales 980 Credits and payments made (966) Balance at December 31, 2020 14 Provision related to product sales 522 Credits and payments made (454) Balance at December 31, 2021 $ 82 |
Inventories (Tables)_2
Inventories (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Schedule of Inventories | Inventories consisted of the following (in thousands): June 30, December 31, 2022 2021 Raw materials $ 9,599 $ 8,074 Work in process 4,746 2,643 Finished goods 4,476 2,786 Total inventories $ 18,821 $ 13,503 | |
Gelesis | ||
Schedule of Inventories | At December 31, 2021 2020 Raw materials $ 8,074 $ 1,213 Work in process 2,643 913 Finished goods 2,786 2,433 Consignment inventories — 563 Total inventories $ 13,503 $ 5,122 |
Prepaid Expenses and Other Cu_5
Prepaid Expenses and Other Current Assets (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following (in thousands): June 30, December 31, 2022 2021 Prepaid expenses $ 1,128 $ 982 Prepaid insurance 1,474 55 Prepaid manufacturing expenses 596 2,624 Prepaid contract research costs 185 262 Research and development tax credit 692 579 Value added tax receivable 1,574 5,633 Deferred financing costs — 3,855 Income tax receivable 198 213 Investment tax credit 906 — Prepaid expenses and other current assets $ 6,753 $ 14,203 | |
Gelesis | ||
Schedule of Prepaid Expenses and Other Current Assets | At December 31, 2021 2020 Prepaid expenses $ 3,874 $ 1,024 Prepaid contract research costs 262 169 Research and development tax credit 579 1,131 Value added tax receivable 5,633 4,315 Deferred financing costs 3,855 38 Prepaid expenses and other current assets $ 14,203 $ 6,677 |
Property and Equipment, Net (_2
Property and Equipment, Net (Tables) (Imported) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Schedule of Property and Equipment, Net | Property and equipment, net, consisted of the following (in thousands): June 30, December 31, 2022 2021 Laboratory and manufacturing equipment $ 28,158 $ 28,101 Land and buildings 10,186 10,404 Leasehold improvements 1,490 1,614 Computer equipment and software 529 463 Capitalized software 232 228 Construction in process 21,683 22,097 Property and equipment – at cost 62,278 62,907 Less accumulated depreciation (5,973) (4,392) Property and equipment – net $ 56,305 $ 58,515 | |
Gelesis | ||
Schedule of Property and Equipment, Net | At December 31, 2021 2020 Laboratory and manufacturing equipment $ 28,101 $ 8,176 Land and buildings 10,404 4,334 Leasehold improvements 1,614 1,742 Computer equipment and software 463 176 Capitalized software 228 17 Construction in process 22,097 35,551 Property and equipment – at cost 62,907 49,996 Less accumulated depreciation (4,392) (3,101) Property and equipment – net $ 58,515 $ 46,895 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Accrued Expenses | ||
Schedule of Accrued Expenses | Accrued expenses and other current liabilities consisted of the following (in thousands): June 30, December 31, 2022 2021 Accrued payroll and related benefits $ 2,442 $ 1,384 Accrued professional fees and outside contractors (including due to related party of 2,392 4,359 Accrued property, plant and equipment additions 589 1,257 Accrued inventory and manufacturing expense 285 128 Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) 2,612 5,604 Tax payables 70 145 Deferred legal fees 738 738 Accrued interest 587 45 Total accrued expenses $ 9,715 $ 13,660 | At December 31, 2021 2020 Accrued payroll and related benefits $ 1,384 $ 3,009 Accrued professional fees and outside contractors (including due to related party of $60 and $109, respectively) 4,359 3,494 Accrued property, plant and equipment additions 1,257 768 Accrued inventory and manufacturing expense 128 — Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) 5,604 — Income taxes payable 145 — Deferred IPO Fees 738 — Accrued interest 45 49 Total accrued expenses $ 13,660 $ 7,320 |
Other Long-Term Liabilities (_2
Other Long-Term Liabilities (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Other Long-Term Liabilities | Other long-term liabilities consisted of the following (in thousands): June, December 31, 2022 2021 Long-term tax liabilities 91 182 Contingent loss for research and development tax credits 2,755 2,990 One S.r.l. call option (see Note 11) 3,062 2,416 Total other long-term liabilities $ 5,908 $ 5,588 | |
Gelesis | ||
Other Long-Term Liabilities | At December 31, 2021 2020 Deferred IPO fees $ — $ 738 Long-term tax liabilities 182 301 Contingent loss for research and development tax credits 2,990 3,233 Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) — 5,912 One Srl call option (see Note 11) 2,416 1,545 Total other long-term liabilities $ 5,588 $ 11,729 |
Significant Agreements (Table_2
Significant Agreements (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Schedule of finite lived intangible assets amortization expense | A summary of the intangible asset activity that resulted from this transaction during the six months ended June 30, 2022 is as follows (in thousands): Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Cumulative amortization expense (5,667) Balance at December 31, 2021 $ 15,680 Period amortization expense (1,133) Balance at June 30, 2022 $ 14,547 | |
Gelesis | ||
Schedule of allocated consideration in the June 2019 transaction on relative fair value basis | Consideration Cash $ 12,668 Warrants for redeemable convertible preferred stock 4,706 Fair value of total consideration $ 17,374 Assets acquired at relative fair value Intangible asset related to reduction in royalty $ 15,564 Equity-method investment 1,810 Total assets acquired $ 17,374 | |
Schedule of finite lived intangible assets amortization expense | Intangible Assets Intangible asset at relative fair value $ 15,564 Adjustment to record deferred tax liability 5,783 Carrying value of intangible asset at June 2019 acquisition date $ 21,347 Amortization expense (1,133) Balance at December 31, 2019 $ 20,214 Amortization expense (2,267) Balance at December 31, 2020 $ 17,947 Amortization expense (2,267) Balance at December 31, 2021 $ 15,680 | |
Schedule of gains on warrant liability settlement | Carrying value of warrants for redeemable convertible preferred stock $ 5,973 Fair value of common stock warrants, net of cash consideration paid of $10 (4,312) Fair value of contingent call option granted to One shareholders (1,494) Gain on warrant liability extinguishment $ 167 |
Debt (Tables)_2
Debt (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Gelesis | |
Schedule of principle payments in connection to debt outstanding | At December 31, 2021 2022 2,183 2023 8,585 2024 5,771 2025 4,199 2026 4,221 More than 5 years 12,877 Unamortized loan discount and issuance costs (754) Total obligation $ 37,081 |
Warrants (Tables)
Warrants (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Gelesis | |
Schedule of warrants outstanding | Summary of Outstanding Warrants The following represents a summary of the warrants outstanding at December 31, 2021: Number of Shares Issued Classification Exercisable for Issuable August 2013 Liability Series A-4 redeemable convertible preferred stock (“Series A-4”) 708,493 October 2020 Equity Common stock 522,009 The following represents a summary of the warrants outstanding at December 31, 2020: Number of Shares Issued Classification Exercisable for Issuable April 2011 Liability Series A-1 redeemable convertible preferred stock (“Series A-1”) 74,784 June 2012 Liability Series A-3 redeemable convertible preferred stock (“Series A-3”) 238,189 August 2013 Liability Series A-4 redeemable convertible preferred stock (“Series A-4”) 708,493 October 2020 Equity Common stock 522,009 |
Redeemable Convertible Prefer_2
Redeemable Convertible Preferred Stock (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Schedule of redeemable convertible preferred stock | At December 31, 2021 and 2020, the ordinary shares reflected in the consolidated balance sheets are reconciled in the following table: Gross proceeds $ 276,000,000 Less: Proceeds allocated to Public Warrants (11,454,000) Class A common stock issuance costs (15,179,927) Plus: Remeasurement of carrying value to redemption value 26,667,374 Common stock subject to possible redemption, 12/31/20 276,033,447 Remeasurement of carrying value to redemption value (33,447) Common stock subject to possible redemption, 12/31/21 $ 276,000,000 |
Gelesis | |
Schedule of redeemable convertible preferred stock | Redeemable convertible preferred stock consisted of the following at December 31, 2021 (in thousands, except for share data): Preferred Common Stock Stock Issued and Liquidation Carrying Issuable Upon Authorized Outstanding Preference Value Conversion Series A-1 1,711,755 1,689,193 $ 7,505 $ 7,113 1,689,193 Series A-2 1,161,254 1,161,254 3,030 3,033 1,161,254 Series A-3 1,730,874 1,730,874 5,188 7,460 1,730,874 Series A-4 2,159,022 1,450,529 5,473 2,602 1,450,529 Series A-5 1,977,114 1,977,114 24,536 44,307 1,977,114 Series Growth 2,538,274 2,538,274 31,500 56,959 2,538,274 Series 2 Growth 2,370,803 2,370,803 30,370 53,201 2,370,803 Series 3 Growth 6,308,529 5,818,895 150,768 136,919 5,818,895 Total 19,957,625 18,736,936 $ 258,370 $ 311,594 18,736,936 Redeemable convertible preferred stock consisted of the following at December 31, 2020 (in thousands, except for share data): Preferred Common Stock Stock Issued and Liquidation Carrying Issuable Upon Authorized Outstanding Preference Value Conversion Series A-1 1,711,755 1,636,971 $ 7,273 $ 6,176 1,636,971 Series A-2 1,161,254 1,161,254 3,030 3,033 1,161,254 Series A-3 1,730,874 1,492,685 4,474 4,463 1,492,685 Series A-4 2,159,022 1,450,529 5,473 2,602 1,450,529 Series A-5 1,977,114 1,977,114 24,536 24,991 1,977,114 Series Growth 2,538,274 2,538,274 31,500 32,763 2,538,274 Series 2 Growth 2,370,803 2,370,803 30,370 30,684 2,370,803 Series 3 Growth 6,308,529 5,818,895 150,768 108,813 5,818,895 Total 19,957,625 18,446,525 $ 257,424 $ 213,525 18,446,525 |
Common Stock (Tables)
Common Stock (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Schedule of common stock | At June 30, 2022 and December 31, 2021 common stock reserved for future issuances was as follows: June 30, December 31, 2022 2021 Common stock issued upon option exercise and RSUs vesting 20,000,493 13,486,708 Conversion of all classes of redeemable convertible preferred stock — 48,566,655 Issuances upon exercise of warrants to purchase Series A-4, upon conversion to common warrants — 1,836,429 Issuances upon exercise of common stock warrants 24,333,365 1,353,062 Earnout shares 23,482,845 — Total common stock reserved for future issuance 67,816,703 65,242,854 | |
Gelesis | ||
Schedule of common stock | At December 31, 2021 2020 Common stock options and RSUs outstanding 5,203,174 5,034,858 Conversion of all classes of redeemable convertible preferred stock 18,736,936 18,446,525 Issuances upon exercise of warrants to purchase Series A-1, upon conversion to common warrants — 74,784 Issuances upon exercise of warrants to purchase Series A-3, upon conversion to common warrants — 238,189 Issuances upon exercise of warrants to purchase Series A-4, upon conversion to common warrants 708,493 708,493 Issuances upon exercise of common stock warrants 522,009 522,009 Total common stock reserved for future issuance 25,170,612 25,024,858 |
Stock-Based Compensation (Tab_2
Stock-Based Compensation (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Summary of Stock Option Activity | The following table summarizes the Company’s stock option activity during the six months ended June 30, 2022: Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price per Contractual Intrinsic Value Options Share Term (Years) (in thousands) Outstanding at December 31, 2021 4,889,820 $ 10.39 6.17 $ 54,449 Retroactive application of reverse recapitalization 7,784,666 (6.38) Adjusted and Outstanding at December 31, 2021 12,674,486 $ 4.01 6.17 $ 54,449 Granted 2,658,185 $ 3.35 Exercised (162,064) $ 0.68 Forfeited - unvested (17,281) $ 5.56 Forfeited - vested (63,718) $ 4.31 Expired (456,534) $ 1.23 Outstanding at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 Exercisable at June 30, 2022 9,780,237 $ 3.81 5.43 $ 840 Vested and Expected to Vest at June 30, 2022 14,633,074 $ 4.01 6.66 $ 840 | |
Schedule of Grant Date Fair Value of Options Issued Using Black-Scholes Weighted Average Assumptions | The fair value of each option issued was estimated at the date of grant using Black-Scholes with the following weighted-average assumptions: Six Month Ended June 30, 2022 Market price of common stock $ 3.35 Expected volatility 72.4 % Expected term (in years) 6.1 Risk-free interest rate 1.7 % Expected dividend yield 0.0 % | |
Gelesis | ||
Summary of Stock Option Activity | Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price per Contractual Intrinsic Value Options Share Term (Years) (in thousands) Outstanding at December 31, 2020 5,034,858 $ 9.26 6.12 $ 14,742 Granted 518,684 18.52 Exercised (255,062) 0.57 5,304 Forfeited (68,090) 10.98 Expired (340,570) 1.49 Outstanding at December 31, 2021 4,889,820 $ 10.39 6.17 $ 54,449 Exercisable at December 31, 2021 3,704,417 $ 9.21 5.28 $ 45,211 Nonvested at December 31, 2021 1,185,403 $ 14.10 8.95 $ 9,238 | |
Schedule of stock-based compensation expense | Year ended December 31, 2021 2020 Research and development $ 1,565 $ 1,960 General and administrative 3,967 2,848 Total $ 5,532 $ 4,808 | |
Schedule of Grant Date Fair Value of Options Issued Using Black-Scholes Weighted Average Assumptions | Year ended December 31, 2021 2020 Fair value of common stock $ 20.02 $ 11.18 Expected volatility 60.1 % 63.6 % Expected term (in years) 5.8 5.8 Risk-free interest rate 1.1 % 0.2 % Expected dividend yield 0.0 % 0.0 % |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Schedule of (benefit from) provision for income taxes | December 31, December 31, 2021 2020 Federal Current $ — $ — Deferred (28,719) (465,518) State and Local Current — — Deferred — — Change in valuation allowance 28,719 465,518 Income tax provision $ — $ — |
Schedule of reconciliation setting forth the differences between the effective tax rates | December 31, 2021 December 31, 2020 Statutory federal income tax rate 21.0 % 21.0 % State taxes, net of federal tax benefit 0.0 % 0.0 % Business combination expense (33.19) % — Change in fair value of warrants 12.38 % 0.0 % Transaction costs incurred in connection with warrant liabilities — (0.0) % Valuation allowance (0.19) % (21.0) % Income tax provision 0.0 % 0.0 % |
Significant components of the Company's consolidated deferred tax assets and liabilities | December 31, December 31, 2021 2020 Deferred tax assets (liabilities) Net operating loss carryforward $ 9,695 $ 36,961 Startup/Organizational expenses 488,923 472,542 Unrealized gain on marketable securities (4,382) (43,985) Total deferred tax assets 494,236 465,518 Valuation allowance (494,236) (465,518) Deferred tax assets, net of valuation allowance $ — $ — |
Gelesis | |
Summary of Consolidated (loss) income before income taxes on a geographic basis | Consolidated (loss) income before income taxes on a geographic basis during the years ended December 31, 2021 and 2020 are as follows (in thousands): Year Ended December 31 2021 2020 United States $ (86,693) $ (19,658) Non-U.S. (6,637) (4,208) Total $ (93,330) $ (23,866) |
Schedule of (benefit from) provision for income taxes | The provision for income taxes consists of the following components during the years ended December 31, 2021 and 2020 (in thousands): Year Ended December 31, 2021 2020 Current tax expense (benefit): U.S. federal $ — $ — Foreign 17 (24) Total current tax expense (benefit) 17 (24) Deferred tax expense: U.S. federal — — State — — Foreign — 2,063 Total deferred tax benefit — 2,063 Total provision for income taxes $ 17 $ 2,039 |
Schedule of reconciliation setting forth the differences between the effective tax rates | Year Ended December 31, 2021 2020 U.S. Federal income tax provision expense at statutory rate 21.0 % 21.0 % Effect of nondeductible stock-based compensation 0.8 % (1.9) % Foreign rate differential 0.2 % 2.2 % Mark to market of warrant liabilities (1.7) % (1.3) % State taxes net of federal benefit 4.3 % 4.5 % Non-deductible financing expenses (0.3) % 0.4 % Valuation allowance (24.2) % (38.3) % Investment transfer 0.0 % 6.8 % Other differences (0.4) % (0.4) % US federal and state research credits 0.4 % 1.6 % Uncertain tax positions (0.1) % (1.1) % Foreign earnings includible in US 0.0 % (2.0) % Effective income tax rate 0.0 % (8.5) % |
Significant components of the Company's consolidated deferred tax assets and liabilities | Significant components of the Company’s consolidated deferred tax assets and liabilities at December 31, 2021 and 2020 are as follows at (in thousands): At December 31, 2021 2020 Deferred tax assets: Federal net operating loss carryforwards $ 40,469 $ 24,730 State net operating loss carryforwards 10,643 7,207 Equity compensation 5,620 4,353 Accruals and reserves — 26 Uncollected grants 998 712 Investment in subsidiaries 3,820 3,931 Research credits 1,578 1,298 Other assets 152 46 Deferred income 239 — Interest 257 — Deferred rent 547 600 Total deferred tax assets 64,323 42,903 Valuation allowance (59,841) (37,427) Total deferred tax assets net of valuation allowance 4,482 5,476 Deferred tax liabilities: Intangible assets and amortization (3,932) (4,680) Right-of-Use asset (536) (591) Other liabilities (14) (204) Total deferred tax liabilities (4,482) (5,476) Net deferred tax assets $ — $ — |
Reconciliation of the beginning and ending amount of uncertain tax positions | A reconciliation of the beginning and ending amount of uncertain tax positions is as follows (in thousands): Year Ended December 31, 2021 2020 Unrecognized tax benefits at the beginning of year $ (281) $ — Increase for current year positions (71) (82) Increase for prior year positions — (199) Expiration of statute of limitations — — Unrecognized tax benefits at the end of year (352) (281) Gross research credit tax assets 1,930 1,579 Net research credit tax assets $ 1,578 $ 1,298 |
Earnings (Loss) per Share (Ta_2
Earnings (Loss) per Share (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Schedule of Earnings Per Share, Basic and Diluted | Basic and diluted loss per share attributable to common stockholders was calculated as follows: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net loss $ (12,513) $ (24,739) $ (18,216) $ (43,325) Accretion of redeemable convertible preferred stock to redemption value — (82,365) (37,934) (116,126) Accretion of noncontrolling interest put option to redemption value (85) (96) (173) (190) Net loss attributable to common stockholders $ (12,598) $ (107,200) $ (56,323) $ (159,641) Denominator: Weighted average common shares outstanding, basic and diluted 72,423,043 5,589,728 67,609,838 5,592,911 Net loss per share, basic and diluted $ (0.17) $ (19.18) $ (0.83) $ (28.54) | For the Period from February 14, 2020 (Inception) Through Year Ended December 31, December 31, 2021 2020 Class A Class B Class A Class B Basic and diluted net loss per common share Numerator: Allocation of net loss, as adjusted $ (10,318,466) $ (2,579,616) $ (10,719,238) $ (4,575,622) Denominator: Basic and diluted weighted average stock outstanding 27,600,000 6,900,000 15,218,692 6,496,262 Basic and diluted net loss per common share $ (0.37) $ (0.37) $ (0.70) $ (0.70) |
Schedule of Anti-dilutive Securities Excluded from Computation of Net Loss Per Share | June 30, 2022 2021 Convertible preferred stock — 48,566,655 Warrants on convertible preferred stock — 1,836,429 Options and RSUs to acquire common stock 20,000,493 13,624,593 Warrants on common stock 24,333,365 1,353,062 Earnout shares — — Total 44,333,858 65,380,739 | |
Gelesis | ||
Schedule of Earnings Per Share, Basic and Diluted | December 31, 2021 2020 Numerator: Net loss $ (93,347) $ (25,905) Accretion of redeemable convertible preferred stock to redemption value (94,134) (11,372) Accretion of noncontrolling interest put option to redemption value (376) (567) Net loss attributable to common stockholders $ (187,857) $ (37,844) Denominator: Weighted average common shares outstanding, basic and diluted 2,204,486 2,149,182 Net loss per share, basic and diluted $ (85.22) $ (17.61) | |
Schedule of Anti-dilutive Securities Excluded from Computation of Net Loss Per Share | December 31, 2021 2020 Convertible preferred stock 18,736,936 18,446,525 Warrants on convertible preferred stock 708,493 1,021,466 Options and RSUs to acquire common stock 5,203,174 5,074,547 Warrants on common stock 522,009 522,009 Total 25,170,612 25,064,547 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Schedule of future minimum rental payments under the Company's noncancelable operating leases | Future maturities of the lease liability under the Company’s noncancelable operating leases at June 30, 2022 are as follows (in thousands): At June 30, 2022 Remaining 2022 maturities $ 313 2023 629 2024 553 2025 383 2026 30 More than 5 years 15 Total undiscounted lease maturities $ 1,923 Imputed interest (151) Total lease liability $ 1,772 | |
Gelesis | ||
Schedule of future minimum rental payments under the Company's noncancelable operating leases | At December 31, 2021 2022 $ 634 2023 639 2024 555 2025 385 2026 33 More than 5 years 16 Total undiscounted lease maturities $ 2,262 Imputed interest (202) Total lease liability $ 2,060 |
Nature of the Business and Ba_3
Nature of the Business and Basis of Presentation (Details) $ in Millions | Jan. 13, 2022 USD ($) |
Gelesis | |
Gross proceeds | $ 105 |
Summary of Significant Accou_14
Summary of Significant Accounting Policies - Property and Equipment (Details) - Gelesis | 12 Months Ended |
Dec. 31, 2021 | |
Computer equipment and software | Minimum | |
Property and Equipment, Net | |
Estimated Useful Life (in years) | 1 year |
Computer equipment and software | Maximum | |
Property and Equipment, Net | |
Estimated Useful Life (in years) | 3 years |
Laboratory and manufacturing equipment | Minimum | |
Property and Equipment, Net | |
Estimated Useful Life (in years) | 2 years 6 months |
Laboratory and manufacturing equipment | Maximum | |
Property and Equipment, Net | |
Estimated Useful Life (in years) | 8 years 3 months 18 days |
Leasehold Improvements | Minimum | |
Property and Equipment, Net | |
Estimated Useful Life (in years) | 5 years |
Leasehold Improvements | Maximum | |
Property and Equipment, Net | |
Estimated Useful Life (in years) | 10 years |
Buildings and land improvements | Minimum | |
Property and Equipment, Net | |
Estimated Useful Life (in years) | 18 years |
Buildings and land improvements | Maximum | |
Property and Equipment, Net | |
Estimated Useful Life (in years) | 20 years |
Summary of Significant Accou_15
Summary of Significant Accounting Policies - License and Collaboration Revenues (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Gelesis | |
Performance obligations to be satisfied over time for recognition | $ 0 |
Summary of Significant Accou_16
Summary of Significant Accounting Policies - Stock-Based Compensation (Details) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Stock-Based Compensation | |||
Expected term (in years) | 6 years 1 month 6 days | ||
Expected dividend yield | 0% | ||
Gelesis | |||
Stock-Based Compensation | |||
Expected term (in years) | 5 years 9 months 18 days | 5 years 9 months 18 days | |
Expected dividend yield | 0% | 0% |
Fair Value Measurements - Fair
Fair Value Measurements - Fair value of assets and liabilities (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2022 | |
Fair Value, Transfers Between Level 1 and Level 2, Description and Policy [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 | |||
Fair Value Measurements Recurring [Member] | ||||
Liabilities: | ||||
Convertible promissory notes (see Note 12) | $ 27,128,000 | |||
Preferred stock warrants | 15,821,000 | |||
One Srl call option (see Note 11) | 2,416,000 | $ 3,062,000 | ||
Total liabilities measured at fair value | 45,365,000 | 10,382,000 | ||
Fair Value Measurements Recurring [Member] | Level 1 | ||||
Assets | ||||
Total assets measured at fair value | 276,207,207 | $ 276,209,453 | ||
Fair Value Measurements Recurring [Member] | Fair Value Inputs Level3 [Member] | ||||
Liabilities: | ||||
Convertible promissory notes (see Note 12) | 27,128,000 | |||
Preferred stock warrants | 15,821,000 | |||
One Srl call option (see Note 11) | 2,416,000 | 3,062,000 | ||
Total liabilities measured at fair value | 45,365,000 | $ 10,382,000 | ||
Gelesis | ||||
Assets | ||||
Marketable securities | 23,998,000 | 23,998,000 | ||
Gelesis | Fair Value Measurements Recurring [Member] | ||||
Assets | ||||
Marketable securities | 23,998,000 | |||
Total assets measured at fair value | 23,998,000 | |||
Liabilities: | ||||
Convertible promissory notes (see Note 12) | 27,128,000 | |||
Preferred stock warrants | 15,821,000 | 12,099,000 | ||
One Srl call option (see Note 11) | 2,416,000 | 1,545,000 | ||
Total liabilities measured at fair value | 45,365,000 | 13,644,000 | ||
Fair Value, Transfers Between Level 1 and Level 2, Description and Policy [Abstract] | ||||
Assets, Transfer from Level 1 to Level 2 | 0 | 0 | ||
Assets, Transfer from Level 2 to Level 1 | 0 | 0 | ||
Assets, Transfer into Level 3 | 0 | 0 | ||
Assets, Transfer out of Level 3 | 0 | 0 | ||
Liabilities, Transfer from Level 1 to Level 2 | 0 | 0 | ||
Liabilities, Transfer from Level 2 to Level 1 | 0 | 0 | ||
Liabilities, Transfer into Level 3 | 0 | 0 | ||
Liabilities, Transfer out of Level 3 | 0 | 0 | ||
Gelesis | Fair Value Measurements Recurring [Member] | Level 1 | ||||
Assets | ||||
Marketable securities | 23,998,000 | |||
Total assets measured at fair value | 23,998,000 | |||
Gelesis | Fair Value Measurements Recurring [Member] | Fair Value Inputs Level3 [Member] | ||||
Liabilities: | ||||
Convertible promissory notes (see Note 12) | 27,128,000 | |||
Preferred stock warrants | 15,821,000 | 12,099,000 | ||
One Srl call option (see Note 11) | 2,416,000 | 1,545,000 | ||
Total liabilities measured at fair value | $ 45,365,000 | $ 13,644,000 |
Fair Value Measurements - Signi
Fair Value Measurements - Significant assumption (Details) - Gelesis | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
IPO scenario (as a percent) | 2.50% | 75% |
Trade sale (as a percent) | 2.50% | 25% |
Trade sale after Qualified Financing (as a percent) | 95% | 0% |
Fair Value Measurements - Tranc
Fair Value Measurements - Tranche right liability (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2020 | |
Tranche Right Liability [Roll Forward] | ||
Beginning balance | $ 15,821 | |
Ending balance | $ 1,130 | |
Gelesis | ||
Tranche Right Liability [Roll Forward] | ||
Change in fair value of tranche rights liability | $ 256 | |
Gelesis | Series 3 Growth Tranche Rights | ||
Tranche Right Liability [Roll Forward] | ||
Settlement of Series 3 Growth tranche right liability | (54) | |
Gelesis | Tranche right liability | ||
Tranche Right Liability [Roll Forward] | ||
Beginning balance | 310 | |
Change in fair value of tranche right liability immediately prior to tranche settlement | (256) | |
Change in fair value of tranche rights liability | $ 300 |
Fair Value Measurements - Prefe
Fair Value Measurements - Preferred stock warrant liability (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | ||||
Apr. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Changes in fair value | $ (6,084,000) | ||||||||
Change in fair value of warrant liabilities | $ (2,600,000) | $ 4,977,000 | (6,084,000) | $ 7,051,000 | $ 12,406,208 | $ (7,602,367) | |||
Warrant liability, current | 15,821,000 | ||||||||
Warrant liability, noncurrent | $ 1,130,000 | 1,130,000 | |||||||
Gelesis | |||||||||
Change in fair value of warrant liabilities | 7,646,000 | $ 1,466,000 | |||||||
Warrant liability, current | 600,000 | 15,800,000 | 600,000 | ||||||
Warrant liability, noncurrent | 11,500,000 | 11,500,000 | |||||||
Gelesis | One Srl | |||||||||
Warrant liability, beginning | 5,973,000 | ||||||||
Change in fair value of warrant liabilities | 167,000 | 200,000 | |||||||
Warrant liability, ending | 5,973,000 | ||||||||
Warrant liability, noncurrent | 4,312,000 | ||||||||
Gelesis | Warrant Liability [Member] | |||||||||
Warrant liability, beginning | 15,821,000 | 12,099,000 | 12,099,000 | 15,996,000 | |||||
Issuance | 745,000 | ||||||||
Changes in fair value | 1,466,000 | ||||||||
Extinguishment | (5,973,000) | ||||||||
Exercise | (135,000) | ||||||||
Exercise of warrants | (3,924,000) | ||||||||
Change in fair value of warrant liabilities | 7,646,000 | ||||||||
Warrant liability, ending | 12,099,000 | 15,821,000 | 12,099,000 | ||||||
Gelesis | Series A-1 | |||||||||
Exercise of warrants | $ 900,000 | ||||||||
Gelesis | Series A-1 | Warrant Liability [Member] | |||||||||
Warrant liability, beginning | 581,000 | 581,000 | 485,000 | ||||||
Changes in fair value | 96,000 | ||||||||
Exercise of warrants | (937,000) | ||||||||
Change in fair value of warrant liabilities | 356,000 | ||||||||
Warrant liability, ending | 581,000 | 581,000 | |||||||
Gelesis | Series A3 Redeemable Convertible Preferred Stock [Member] | |||||||||
Exercise of warrants | $ 3,000,000 | ||||||||
Gelesis | Series A3 Redeemable Convertible Preferred Stock [Member] | Warrant Liability [Member] | |||||||||
Warrant liability, beginning | 2,896,000 | 2,896,000 | 2,541,000 | ||||||
Changes in fair value | 355,000 | ||||||||
Exercise of warrants | (2,987,000) | ||||||||
Change in fair value of warrant liabilities | 91,000 | ||||||||
Warrant liability, ending | 2,896,000 | 2,896,000 | |||||||
Gelesis | Series A4 Redeemable Convertible Preferred Stock [Member] | Warrant Liability [Member] | |||||||||
Warrant liability, beginning | $ 15,821,000 | $ 8,622,000 | 8,622,000 | 7,686,000 | |||||
Changes in fair value | 1,071,000 | ||||||||
Exercise | (135,000) | ||||||||
Change in fair value of warrant liabilities | 7,199,000 | ||||||||
Warrant liability, ending | $ 8,622,000 | $ 15,821,000 | 8,622,000 | ||||||
Gelesis | Series 3 Growth | |||||||||
Change in fair value of warrant liabilities | 744,000 | ||||||||
Gelesis | Series 3 Growth | Warrant Liability [Member] | |||||||||
Warrant liability, beginning | 4,631,000 | ||||||||
Changes in fair value | 1,342,000 | ||||||||
Extinguishment | (5,973,000) | ||||||||
Gelesis | Series 4 Growth | Warrant Liability [Member] | |||||||||
Warrant liability, beginning | 653,000 | ||||||||
Issuance | 745,000 | ||||||||
Changes in fair value | $ (1,398,000) |
Fair Value Measurements - Call
Fair Value Measurements - Call Option and Convertible Promissory Notes (Details) - Gelesis | Dec. 31, 2021 Y USD ($) | Dec. 31, 2020 Y USD ($) |
Convertible promissory notes | Expected term | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0.1 | |
Convertible promissory notes | Discount rate | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 36.3 | |
Convertible promissory notes | Probability of repayment after close of business combination | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 95 | |
Convertible promissory notes | Probability of holder electing conversion option | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 5 | |
One Srl call option | Expected term | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 2 | 1.8 |
One Srl call option | Measurement Input Price Volatility [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 62 | 61 |
One Srl call option | Measurement Input Expected Dividend Rate [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0 | 0 |
One Srl call option | Measurement Input Risk Free Interest Rate [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0.7 | 0.1 |
One Srl call option | Estimated fair value of ownership interest | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | $ | 6,922 | 6,066 |
One Srl call option | Exercise price of call option | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | $ | 6,806 | 7,358 |
Series A-1 | Expected term | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0.3 | |
Series A-1 | Measurement Input Price Volatility [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 48 | |
Series A-1 | Measurement Input Expected Dividend Rate [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0 | |
Series A-1 | Measurement Input Risk Free Interest Rate [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0.1 | |
Series A-1 | Estimated fair value of the redeemable convertible preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 12.24 | |
Series A-1 | Measurement Input Exercise Price [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 4.44 | |
Series A3 Redeemable Convertible Preferred Stock [Member] | Expected term | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 1.5 | |
Series A3 Redeemable Convertible Preferred Stock [Member] | Measurement Input Price Volatility [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 68 | |
Series A3 Redeemable Convertible Preferred Stock [Member] | Measurement Input Expected Dividend Rate [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0 | |
Series A3 Redeemable Convertible Preferred Stock [Member] | Measurement Input Risk Free Interest Rate [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0.1 | |
Series A3 Redeemable Convertible Preferred Stock [Member] | Estimated fair value of the redeemable convertible preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 12.21 | |
Series A3 Redeemable Convertible Preferred Stock [Member] | Measurement Input Exercise Price [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0.04 | |
Series A4 Redeemable Convertible Preferred Stock [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0.04 | |
Series A4 Redeemable Convertible Preferred Stock [Member] | Expected term | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0.1 | 2.6 |
Series A4 Redeemable Convertible Preferred Stock [Member] | Measurement Input Price Volatility [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 48 | 59 |
Series A4 Redeemable Convertible Preferred Stock [Member] | Measurement Input Expected Dividend Rate [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0 | 0 |
Series A4 Redeemable Convertible Preferred Stock [Member] | Measurement Input Risk Free Interest Rate [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0.6 | 0.2 |
Series A4 Redeemable Convertible Preferred Stock [Member] | Estimated fair value of the redeemable convertible preferred stock | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 22.36 | 12.22 |
Series A4 Redeemable Convertible Preferred Stock [Member] | Measurement Input Exercise Price [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Measurement input | 0.04 |
Fair Value Measurements - Cal_2
Fair Value Measurements - Call option liability (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Change in fair value | $ 865 | $ 554 | ||
Gelesis | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Change in fair value | $ 1,024 | |||
Gelesis | One Srl call option | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Fair value of One Srl call option | $ 2,416 | $ 1,545 | 1,545 | $ 1,494 |
Change in fair value | 1,024 | |||
Balance at Ending | 2,416 | 1,545 | ||
Foreign currency translation loss | $ (153) | $ 51 |
Marketable Securities (Details)
Marketable Securities (Details) - Gelesis - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Marketable Securities [Line Items] | ||
Amortized Cost | $ 23,999 | |
Marketable Securities, Unrealized Gain | 1 | |
Gross Unrealized Losses | (2) | |
Fair Value | 23,998 | $ 23,998 |
Commercial Paper [Member] | ||
Marketable Securities [Line Items] | ||
Amortized Cost | 15,999 | |
Marketable Securities, Unrealized Gain | 1 | |
Gross Unrealized Losses | (2) | |
Fair Value | 15,998 | |
US Treasury Securities [Member] | ||
Marketable Securities [Line Items] | ||
Amortized Cost | 8,000 | |
Fair Value | $ 8,000 |
Product Revenue Reserve and A_2
Product Revenue Reserve and Allowance - Narratives (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | 60 Months Ended | |||||||
Jun. 18, 2020 | Jul. 31, 2021 | Jan. 31, 2021 | Jun. 30, 2020 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 18, 2025 | May 31, 2025 | |
Product Revenue Reserve and Allowance | ||||||||||||
Revenue | $ 8,973 | $ 2,178 | $ 16,487 | $ 5,279 | ||||||||
Accounts receivable | 1,256 | 1,256 | $ 731 | |||||||||
Other assets | 4,741 | 4,741 | 4,084 | |||||||||
Product revenue | ||||||||||||
Product Revenue Reserve and Allowance | ||||||||||||
Revenue | $ 8,973 | $ 2,178 | $ 16,487 | $ 5,279 | ||||||||
Gelesis | ||||||||||||
Product Revenue Reserve and Allowance | ||||||||||||
Revenue | 11,185 | $ 21,442 | ||||||||||
Deferred income | 32,370 | 624 | ||||||||||
Accounts receivable | 731 | 818 | ||||||||||
Contract term | 5 years | |||||||||||
Other assets | 4,084 | 3,959 | ||||||||||
Gelesis | Roman Health Pharmacy LLC ("Ro") | ||||||||||||
Product Revenue Reserve and Allowance | ||||||||||||
Deferred income | 31,000 | |||||||||||
Gelesis | CMS Bridging DMCC ("CMS") | ||||||||||||
Product Revenue Reserve and Allowance | ||||||||||||
Revenue | 18,700 | |||||||||||
Upfront fee | $ 15,000 | |||||||||||
Milestone payment required | $ 5,000 | |||||||||||
Discounted time-based milestone | $ 3,700 | 4,100 | 3,900 | |||||||||
Accreted as interest income | $ 1,300 | |||||||||||
Gelesis | Product revenue | ||||||||||||
Product Revenue Reserve and Allowance | ||||||||||||
Revenue | 11,185 | 2,708 | ||||||||||
Gelesis | Product revenue | Roman Health Pharmacy LLC ("Ro") | ||||||||||||
Product Revenue Reserve and Allowance | ||||||||||||
Revenue | 9,700 | 2,500 | ||||||||||
Accounts receivable | 600 | |||||||||||
Pre buy commitment amount | $ 30,000 | $ 10,000 | ||||||||||
Gelesis | Product revenue | GoGoMeds | ||||||||||||
Product Revenue Reserve and Allowance | ||||||||||||
Revenue | 1,500 | 100 | ||||||||||
Accounts receivable | $ 800 | 100 | ||||||||||
Gelesis | Licensing revenue | ||||||||||||
Product Revenue Reserve and Allowance | ||||||||||||
Revenue | $ 18,734 |
Product Revenue Reserve and A_3
Product Revenue Reserve and Allowance - Product revenue reserve and allowance (Details) - Product revenue - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Product Revenue Reserve and Allowance | ||||
Product revenue reserve and allowance, beginning balance | $ 82 | $ 14 | $ 14 | |
Provision related to product sales | 1,193 | 326 | ||
Credits and payments made | (1,154) | (324) | ||
Product revenue reserve and allowance, ending balance | 121 | 16 | 82 | $ 14 |
Gelesis | ||||
Product Revenue Reserve and Allowance | ||||
Product revenue reserve and allowance, beginning balance | $ 82 | $ 14 | 14 | 0 |
Provision related to product sales | 522 | 980 | ||
Credits and payments made | (454) | (966) | ||
Product revenue reserve and allowance, ending balance | $ 82 | $ 14 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Raw materials | $ 9,599 | $ 8,074 | |
Work in process | 4,746 | 2,643 | |
Finished goods | 4,476 | 2,786 | |
Total inventories | $ 18,821 | 13,503 | |
Gelesis | |||
Raw materials | 8,074 | $ 1,213 | |
Work in process | 2,643 | 913 | |
Finished goods | 2,786 | 2,433 | |
Consignment inventories | 563 | ||
Total inventories | $ 13,503 | $ 5,122 |
Prepaid Expenses and Other Cu_6
Prepaid Expenses and Other Current Assets (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Prepaid expenses | $ 1,128,000 | $ 982,000 | $ 65,973 |
Prepaid contract research costs | 185,000 | 262,000 | |
Research and development tax credit | 692,000 | 579,000 | |
Value added tax receivable | 1,574,000 | 5,633,000 | |
Deferred financing costs | 3,855,000 | ||
Prepaid expenses and other current assets | $ 6,753,000 | 14,203,000 | |
Gelesis | |||
Prepaid expenses | 3,874,000 | 1,024,000 | |
Prepaid contract research costs | 262,000 | 169,000 | |
Research and development tax credit | 579,000 | 1,131,000 | |
Value added tax receivable | 5,633,000 | 4,315,000 | |
Deferred financing costs | 3,855,000 | 38,000 | |
Prepaid expenses and other current assets | $ 14,203,000 | $ 6,677,000 |
Property and Equipment Net (Det
Property and Equipment Net (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | $ 62,278 | $ 62,907 | |
Less accumulated depreciation | (5,973) | (4,392) | |
Property and equipment - net | 56,305 | 58,515 | |
Laboratory and Manufacturing Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | 28,158 | 28,101 | |
Computer Equipment and Software | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | 529 | 463 | |
Leasehold Improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | 1,490 | 1,614 | |
Capitalized Software | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | 232 | 228 | |
Construction in Process | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | $ 21,683 | 22,097 | |
Gelesis | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | 62,907 | $ 49,996 | |
Less accumulated depreciation | (4,392) | (3,101) | |
Property and equipment - net | 58,515 | 46,895 | |
Gelesis | Laboratory and Manufacturing Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | 28,101 | 8,176 | |
Gelesis | Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | 10,404 | 4,334 | |
Gelesis | Computer Equipment and Software | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | 463 | 176 | |
Gelesis | Leasehold Improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | 1,614 | 1,742 | |
Gelesis | Capitalized Software | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | 228 | 17 | |
Gelesis | Construction in Process | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment - at cost | $ 22,097 | $ 35,551 |
Property and Equipment Net - Na
Property and Equipment Net - Narrative (Details) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 USD ($) a | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) ft² a | Dec. 31, 2020 USD ($) | |
Property, Plant and Equipment [Line Items] | ||||
Area of land | a | 12 | |||
Payment to acquire manufacturing building | $ | $ 5,067 | $ 10,057 | ||
Gelesis | ||||
Property, Plant and Equipment [Line Items] | ||||
Payment to acquire manufacturing building | $ | $ 19,917 | $ 32,212 | ||
Depreciation expense not related to manufacturing activities | $ | $ 1,500 | $ 500 | ||
Gelesis | Italy | ||||
Property, Plant and Equipment [Line Items] | ||||
Area of land owned and operated | ft² | 51,000 | |||
Area of land further expanded | ft² | 88,600 | |||
Area of land | a | 12 | |||
Area of land construction initiated | ft² | 207,000 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Accrued payroll and related benefits | $ 2,442 | $ 1,384 | |
Accrued professional fees and outside contractors (including due to related party of $60 and $109, respectively) | 2,392 | 4,359 | |
Accrued property, plant and equipment additions | 589 | 1,257 | |
Accrued inventory and manufacturing expense | 285 | 128 | |
Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) | 2,612 | 5,604 | |
Income taxes payable | 70 | 145 | |
Accrued interest | 587 | 45 | |
Total accrued expenses | 9,715 | 13,660 | |
Accrued Professional fee, due to related party | $ 179 | 60 | |
Gelesis | |||
Accrued payroll and related benefits | 1,384 | $ 3,009 | |
Accrued professional fees and outside contractors (including due to related party of $60 and $109, respectively) | 4,359 | 3,494 | |
Accrued property, plant and equipment additions | 1,257 | 768 | |
Accrued inventory and manufacturing expense | 128 | ||
Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) | 5,604 | ||
Income taxes payable | 145 | ||
Deferred IPO Fees | 738 | ||
Accrued interest | 45 | 49 | |
Total accrued expenses | 13,660 | 7,320 | |
Accrued Professional fee, due to related party | $ 60 | $ 109 |
Other Long-Term Liabilities (_3
Other Long-Term Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Long-term tax liabilities | $ 91 | $ 182 | |
Contingent loss for research and development tax credits | 2,755 | 2,990 | |
One S.r.l. call option (see Note 11) | 3,062 | 2,416 | |
Total other long-term liabilities | $ 5,908 | 5,588 | |
Gelesis | |||
Deferred IPO fees | $ 738 | ||
Long-term tax liabilities | 182 | 301 | |
Contingent loss for research and development tax credits | 2,990 | 3,233 | |
Unpaid portion of acquisition of intangible asset and investment in related party (see Note 11) | 5,912 | ||
One S.r.l. call option (see Note 11) | 2,416 | 1,545 | |
Total other long-term liabilities | $ 5,588 | $ 11,729 |
Significant Agreements - Narrat
Significant Agreements - Narratives (Details) $ in Thousands, € in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Nov. 30, 2020 USD ($) | Nov. 30, 2020 EUR (€) | May 31, 2020 EUR (€) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Significant Agreements | |||||||||
Revenue | $ 8,973 | $ 2,178 | $ 16,487 | $ 5,279 | |||||
Puglia 1 Grant | |||||||||
Significant Agreements | |||||||||
Other income, net | 400 | 400 | |||||||
Grant funding for certain facility and equipment investments | 400 | ||||||||
Grant proceeds collected | 0 | ||||||||
Deferred income | 5,500 | 5,500 | $ 6,400 | ||||||
Deferred income | 800 | 800 | 900 | ||||||
Grants receivable | 5,000 | 5,000 | 5,400 | ||||||
Puglia 2 Grant | |||||||||
Significant Agreements | |||||||||
Other income, net | 1,000 | $ 1,000 | |||||||
Grant proceeds collected | 0 | ||||||||
Deferred income | 3,400 | 3,400 | 3,700 | ||||||
Deferred income | 200 | 200 | 400 | ||||||
Grants receivable | $ 4,400 | $ 4,400 | 3,600 | ||||||
Gelesis | |||||||||
Significant Agreements | |||||||||
Revenue | 11,185 | $ 21,442 | |||||||
Other income, net | 781 | 6,000 | |||||||
Deferred income | 32,370 | 624 | |||||||
Grants receivable | 9,172 | 8,116 | |||||||
Gelesis | Puglia 1 Grant | |||||||||
Significant Agreements | |||||||||
Other income, net | 500 | 3,500 | |||||||
Grant funding for certain facility and equipment investments | 100 | 200 | |||||||
Grant funding for certain research and development expenditures | 200 | 3,400 | |||||||
Grant proceeds collected | 4,900 | ||||||||
Grant funding for certain research and development expenditures, period | 3 years | ||||||||
Period not permitted to physically move the reimbursed assets from the Puglia region | 5 years | ||||||||
Deferred income | 6,400 | 5,800 | |||||||
Deferred income | 900 | 600 | |||||||
Grants receivable | 5,400 | 4,300 | |||||||
Gelesis | Puglia 1 Grant | Italy | |||||||||
Significant Agreements | |||||||||
Grant funding for certain facility and equipment investments | € 5.3 | 6,000 | |||||||
Grant funding for certain research and development expenditures | € 3.9 | 4,400 | |||||||
Gelesis | Puglia 2 Grant | |||||||||
Significant Agreements | |||||||||
Revenue | 1,100 | 800 | |||||||
Grant funding for certain facility and equipment investments | $ 3,700 | € 3.3 | |||||||
Grant funding for certain research and development expenditures | $ 9,400 | € 8.3 | |||||||
Grant proceeds collected | 1,900 | 0 | |||||||
Grant funding for certain research and development expenditures, period | 3 years | 3 years | |||||||
Period not permitted to physically move the reimbursed assets from the Puglia region | 5 years | 5 years | |||||||
Deferred income | 3,700 | 3,000 | |||||||
Deferred income | 400 | 0 | |||||||
Grants receivable | $ 3,600 | $ 3,900 |
Significant Agreements - One S.
Significant Agreements - One S.r.l. ("One") (Details) $ in Thousands, € in Millions | 1 Months Ended | 12 Months Ended | ||||||||||
Oct. 31, 2020 USD ($) | Oct. 31, 2020 EUR (€) | Jun. 30, 2019 USD ($) | Jun. 30, 2019 EUR (€) | Dec. 31, 2020 USD ($) | Dec. 31, 2020 EUR (€) | Jun. 30, 2022 USD ($) | Jun. 30, 2022 EUR (€) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 EUR (€) | Jun. 30, 2019 EUR (€) | Jun. 01, 2019 USD ($) | |
Schedule of Equity Method Investments [Line Items] | ||||||||||||
Other long-term liabilities | $ 5,908 | $ 5,588 | ||||||||||
Assets acquired at relative fair value | ||||||||||||
Intangible asset at relative fair value | $ 15,564 | |||||||||||
One | ||||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||||
Equity investment ownership percentage | 10% | 10% | 10% | 10% | ||||||||
Cash consideration | $ 2,900 | |||||||||||
Unpaid cash consideration, after adjusting for a foreign currency translation gain and interest expense | $ 2,600 | € 2.5 | 5,700 | € 5 | ||||||||
Gelesis | ||||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||||
Other long-term liabilities | $ 11,729 | 5,588 | ||||||||||
Consideration | ||||||||||||
Cash | $ 12,668 | |||||||||||
Warrants for redeemable convertible preferred stock | 4,706 | |||||||||||
Fair value of total consideration | 17,374 | |||||||||||
Assets acquired at relative fair value | ||||||||||||
Intangible asset at relative fair value | 15,564 | |||||||||||
Equity-method investment | 1,810 | |||||||||||
Total assets acquired | $ 17,374 | |||||||||||
Gelesis | One | ||||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||||
Equity investment ownership percentage | 10% | 10% | ||||||||||
Payment upon achievement of future commercial milestones | $ 7,400 | € 6.5 | $ 6,200 | € 5.5 | ||||||||
Payment upon achievement of commercial success of new medical indications | $ 12,500 | € 11 | ||||||||||
Require of issue warrant for redeemable convertible preferred stock upon achievement within 30 days of commercial success of new medical indications (as a percent) | 2.70% | 2.70% | ||||||||||
Period of future qualifying equity finance | 30 days | 30 days | ||||||||||
Gross proceeds of future qualifying equity financing | $ 50,000 | |||||||||||
Cash consideration | 13,000 | € 11.5 | ||||||||||
Net present value | 12,700 | € 11.1 | ||||||||||
Consideration paid | 3,100 | € 2.6 | ||||||||||
Unpaid cash consideration, after adjusting for a foreign currency translation gain and interest expense | 5,900 | 5,600 | ||||||||||
Other long-term liabilities | 5,900 | |||||||||||
Accrued expense | $ 5,600 | |||||||||||
Assets acquired at relative fair value | ||||||||||||
Equity-method investment | $ 1,800 | $ 0 |
Significant Agreements - Intang
Significant Agreements - Intangible asset activity (Details) € in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2020 USD ($) shares | Oct. 31, 2020 EUR (€) shares | Jun. 30, 2019 USD ($) | Jun. 30, 2019 EUR (€) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2019 USD ($) | Jun. 30, 2019 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Jun. 01, 2019 USD ($) | |
Schedule of Equity Method Investments [Line Items] | ||||||||||||||
Intangible asset at relative fair value | $ 15,564,000 | |||||||||||||
Change in valuation allowance | $ 5,783,000 | $ 465,518 | $ 28,719 | |||||||||||
Intangible asset, beginning balance | $ 15,680,000 | $ 21,347,000 | ||||||||||||
Amortization expense | $ (566,000) | $ (566,000) | (1,133,000) | $ (1,133,000) | ||||||||||
Intangible asset, ending balance | $ 21,347,000 | 14,547,000 | 14,547,000 | 21,347,000 | 15,680,000 | |||||||||
Provision for income taxes | 0 | 0 | 0 | 17,000 | 0 | 0 | ||||||||
Warrant liabilities | 30,101,808 | 22,499,441 | $ 30,101,808 | |||||||||||
Other long-term liabilities | 5,908,000 | 5,908,000 | 5,588,000 | |||||||||||
Warrant liabilities | 1,130,000 | 1,130,000 | ||||||||||||
Change in fair value of warrant liabilities | $ (2,600,000) | $ 4,977,000 | (6,084,000) | 7,051,000 | 12,406,208 | (7,602,367) | ||||||||
Gelesis | ||||||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||||||
Intangible asset at relative fair value | 15,564,000 | 15,564,000 | ||||||||||||
Change in valuation allowance | 5,783,000 | 22,400,000 | 9,100,000 | |||||||||||
Deferred tax liability recognized for intangible asset acquired | 5,800,000 | 5,800,000 | ||||||||||||
Intangible asset, beginning balance | $ 15,680,000 | $ 17,947,000 | 21,347,000 | 17,947,000 | 20,214,000 | |||||||||
Amortization expense | (1,133,000) | (2,267,000) | (2,267,000) | |||||||||||
Intangible asset, ending balance | 21,347,000 | $ 20,214,000 | 21,347,000 | 17,947,000 | 15,680,000 | 17,947,000 | ||||||||
Initially allocated value of equity-method investment | 1,810,000 | 1,810,000 | ||||||||||||
Provision for income taxes | 17,000 | 2,039,000 | ||||||||||||
Other long-term liabilities | 11,729,000 | 5,588,000 | 11,729,000 | |||||||||||
Warrant liabilities | 11,500,000 | 11,500,000 | ||||||||||||
Other Nonoperating Income | 781,000 | 6,000,000 | ||||||||||||
Change in fair value of warrant liabilities | 7,646,000 | 1,466,000 | ||||||||||||
Gelesis | One | ||||||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||||||
Initially allocated value of equity-method investment | 1,800,000 | 1,800,000 | 0 | 0 | ||||||||||
Deferred tax asset generated by book-to-tax difference (see Note 17) | $ 3,100,000 | |||||||||||||
Deferred credit | 1,200,000 | |||||||||||||
Deferred tax asset wrote-off generated by the book-to-tax difference | 1,200,000 | |||||||||||||
Deferred credit wrote-off | 3,000,000 | |||||||||||||
Provision for income taxes | 1,800,000 | |||||||||||||
Consideration upon achievement of future commercial milestones | $ 7,400,000 | € 6.5 | 6,200,000 | € 5.5 | ||||||||||
Commercial milestones, cumulative net sales for weight loss product | € | € 2 | |||||||||||||
Warrants granted upon 2nd amendment | shares | 522,009 | 522,009 | ||||||||||||
Percent of ownership, contingent call option to buy back | 10% | 10% | 10% | |||||||||||
Call option exercise price | $ 6,800,000 | € 6 | ||||||||||||
Warrant liabilities | $ 6,000,000 | |||||||||||||
Other long-term liabilities | $ 5,900,000 | 5,900,000 | ||||||||||||
Carrying value of warrant liability for redeemable convertible preferred stock | $ 5,800,000 | $ 5,800,000 | $ 5,973,000 | |||||||||||
Warrant liabilities | 4,312,000 | |||||||||||||
Fair value of contingent call option granted to One shareholders | 1,494,000 | |||||||||||||
Change in fair value of warrant liabilities | 167,000 | $ 200,000 | ||||||||||||
Fair value of common stock warrants, cash consideration paid | $ 10,000 |
Significant Agreements - Resear
Significant Agreements - Research Innovation Fund (RIF) Financing (Details) € in Millions | 1 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | ||||
Aug. 31, 2020 EUR (€) | Jun. 30, 2022 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2020 EUR (€) | Aug. 31, 2020 USD ($) | Aug. 31, 2020 EUR (€) | |
Schedule of Equity Method Investments [Line Items] | ||||||||
Issuance costs | $ 671,828 | |||||||
Noncontrolling interest | $ 11,087,000 | $ 11,855,000 | ||||||
Research Innovation Fund Financing [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Proceeds from RIF | € 10 | 10,400,000 | ||||||
Debt | $ 15,700,000 | € 15 | ||||||
Interest rate (as a percent) | 6.35% | 6.35% | ||||||
Investments interest rate | 15% | 15% | ||||||
Annual interest rate in connection with transaction | 3.175% | |||||||
Long term debt term | 8 years | 8 years | ||||||
Period of subsequent issuance | 24 months | |||||||
Equity interest held by related party | 20% | |||||||
Foreign currency translation gain (loss) | $ 900,000 | |||||||
Gelesis | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Debt | 37,081,000 | |||||||
Issuance costs | 0 | $ 329,000 | ||||||
Noncontrolling interest | 12,429,000 | 11,855,000 | 12,429,000 | |||||
Gelesis | Research Innovation Fund Financing [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Proceeds from RIF | € 10 | $ 11,300,000 | ||||||
Debt | $ 17,000,000 | € 15 | ||||||
Interest rate (as a percent) | 6.35% | 6.35% | ||||||
Investments interest rate | 15% | 15% | ||||||
Annual interest rate in connection with transaction | 3.175% | 3.175% | ||||||
Long term debt term | 8 years | 8 years | ||||||
Period of subsequent issuance | 24 months | |||||||
Equity interest held by related party | 20% | |||||||
Minority interest, net of issuance cost | 11,300,000 | 11,300,000 | € 10 | |||||
Accretion of noncontrolling interest | 600,000 | $ 1,000,000 | 600,000 | |||||
Foreign currency translation gain (loss) | 400,000 | 500,000 | ||||||
Noncontrolling interest | $ 12,400,000 | $ 11,900,000 | $ 12,400,000 |
Debt - Additional information_2
Debt - Additional information (Details) € in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||||||
Dec. 13, 2021 USD ($) | Nov. 30, 2020 EUR (€) | Nov. 30, 2019 EUR (€) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Mar. 31, 2021 EUR (€) | Dec. 31, 2020 EUR (€) | Oct. 31, 2020 EUR (€) | Aug. 31, 2020 EUR (€) | Apr. 30, 2020 USD ($) | Dec. 31, 2019 EUR (€) | May 31, 2014 EUR (€) | |
SSD2 [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 12,000 | |||||||||||
Puretech [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | 15,000 | |||||||||||
Italian Economic Development Agency Loan | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 1,400 | |||||||||||
Gelesis | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | 37,081 | |||||||||||
Gain on extinguishment of debt | $ 297 | |||||||||||
Gelesis | SSD2 [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | 12,000 | |||||||||||
Gelesis | Puretech [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 15,000 | |||||||||||
Gelesis | Italian Economic Development Agency Loan | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | € | € 1,200 | |||||||||||
Interest rate (as a percent) | 0.332% | |||||||||||
Gelesis | Intesa Sanpaolo Loan, November 2019 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | € 2,400 | 2,800 | ||||||||||
Convertible debt payment due time | 3 months | |||||||||||
Net of transaction costs | € 100 | 100 | ||||||||||
Gelesis | Intesa Sanpaolo Loan, November 2019 | Euribor rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate (as a percent) | 2.30% | |||||||||||
Gelesis | Intesa Sanpaolo Loan, 2020 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | 5,700 | € 5,000 | ||||||||||
Net of transaction costs | 14,000 | € 13,000 | ||||||||||
Gelesis | Intesa Sanpaolo Loan, March 2021 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | 5,400 | € 4,800 | ||||||||||
Interest rate (as a percent) | 0.701% | |||||||||||
Net of transaction costs | 200 | € 200 | ||||||||||
Gelesis | Intesa Sanpaolo Loan, March 2021 | Minimum | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | € | € 5,000 | |||||||||||
Gelesis | Horizon 2020 Loan, December 2019 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | 300 | € 300 | ||||||||||
Interest rate (as a percent) | 0.171% | |||||||||||
Net of transaction costs | 24,000 | € 21,000 | ||||||||||
Gelesis | Horizon 2020 Loan, October 2020 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | 200 | € 200 | ||||||||||
Net of transaction costs | 22,000 | € 19,000,000 | ||||||||||
Gelesis | RIF Shareholders Loan | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | 16,400 | € 14,500 | ||||||||||
Interest rate (as a percent) | 6.35% | |||||||||||
Net of transaction costs | 600 | € 500 | ||||||||||
Gelesis | UniCredit Loan | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | € 4,900 | 5,700 | ||||||||||
Net of transaction costs | € 100 | 100 | ||||||||||
Debt instrument variable rate | 2.12% | |||||||||||
Gelesis | PPP Loan | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 300 | |||||||||||
Gain on extinguishment of debt | $ 300 | |||||||||||
Gelesis | 2021 Bridge Financing | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate (as a percent) | 10% | |||||||||||
Percentage on price for conversion | 75 | |||||||||||
Convertible promissory notes (see Note 12) | $ 27,000 | 27,100 | ||||||||||
Loss on change in fair value of the convertible promissory notes | $ 100 | |||||||||||
Gelesis | 2021 Bridge Financing | SSD2 [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | 12,000 | |||||||||||
Gelesis | 2021 Bridge Financing | Puretech [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 15,000 |
Debt - Future principal payment
Debt - Future principal payments in connection to debt (Details) - Gelesis $ in Thousands | Dec. 31, 2021 USD ($) |
Long term debt future principal payments | |
2022 | $ 2,183 |
2023 | 8,585 |
2024 | 5,771 |
2025 | 4,199 |
2026 | 4,221 |
More than 5 years | 12,877 |
Unamortized loan discount and issuance costs | (754) |
Total debt obligation carrying amount | $ 37,081 |
Warrants (Details)_2
Warrants (Details) - Gelesis - shares | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Series A-1 redeemable convertible preferred stock ("Series A-1") | |||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||
Warrants outstanding | 74,784 | ||
Series A-3 redeemable convertible preferred stock ("Series A-3") | |||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||
Warrants outstanding | 238,189 | ||
Series A-4 redeemable convertible preferred stock ("Series A-4") | |||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||
Warrants outstanding | 708,493 | 708,493 | |
Common Stock Warrant [Member] | |||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||
Warrants outstanding | 522,009 | 522,009 | |
Warrants and Rights Subject to Mandatory Redemption | Series A-4 redeemable convertible preferred stock ("Series A-4") | |||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||
Warrants outstanding | 708,493 | 708,493 | |
Warrants and Rights Subject to Mandatory Redemption | Series 3 Growth redeemable convertible preferred stock -"Series 3 Growth" | |||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||
Warrants outstanding | 478,828 |
Warrants - Series A-1 Warrants
Warrants - Series A-1 Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Apr. 30, 2021 | Apr. 30, 2011 | Dec. 31, 2021 | Jun. 30, 2022 | Dec. 31, 2020 | Jul. 07, 2020 | Mar. 31, 2015 | |
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||||
Exercise price of warrants | $ 11.50 | ||||||
Sale of Private Placement Warrants (in shares) | 1,353,062 | 24,333,365 | 7,520,000 | ||||
Warrant liabilities | $ 1,130 | ||||||
Gelesis | |||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||||
Gross proceeds from first sale of shares | $ 50,000 | ||||||
Sale of Private Placement Warrants (in shares) | 522,009 | 522,009 | |||||
Warrant liabilities | $ 11,500 | ||||||
Gelesis | Warrants and Rights Subject to Mandatory Redemption | Series A-1 redeemable convertible preferred stock ("Series A-1") | |||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||||
Exercise price of warrants | $ 4.44 | $ 4.44 | |||||
Gross proceeds from first sale of shares | $ 5,000 | ||||||
Quotient for calculating number of warrants exercisable | $ 300 | ||||||
Sale of Private Placement Warrants (in shares) | 74,784 | ||||||
Warrants expiration term | 3 years | ||||||
Warrant liabilities | $ 600 | ||||||
Shares issued on Conversion of debt | 52,222 | ||||||
Exercise of warrants | $ 900 |
Warrants - Series A-3 Warrants
Warrants - Series A-3 Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2021 | Jun. 30, 2022 | Mar. 31, 2021 | Dec. 31, 2020 | Jul. 07, 2020 | Jun. 30, 2012 | |
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||
Sale of Private Placement Warrants (in shares) | 1,353,062 | 24,333,365 | 7,520,000 | |||
Exercise price of warrants | $ 11.50 | |||||
Warrant liabilities | $ 1,130 | |||||
Gelesis | ||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||
Sale of Private Placement Warrants (in shares) | 522,009 | 522,009 | ||||
Warrant liabilities | $ 11,500 | |||||
Gelesis | Warrants and Rights Subject to Mandatory Redemption | Series A-3 redeemable convertible preferred stock ("Series A-3") | ||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||
Sale of Private Placement Warrants (in shares) | 238,189 | 238,189 | ||||
Exercise price of warrants | $ 0.04 | |||||
Exercise of warrants | $ 3,000 | |||||
Warrant liabilities | $ 2,900 | $ 700 |
Warrants - Series A-4 Warrants
Warrants - Series A-4 Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | |||||
Oct. 31, 2020 | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jul. 07, 2020 | Aug. 31, 2013 | |
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||
Sale of Private Placement Warrants (in shares) | 24,333,365 | 1,353,062 | 7,520,000 | |||
Exercise price of warrants | $ 11.50 | |||||
Warrant liabilities | $ 1,130 | |||||
Gelesis | ||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||
Sale of Private Placement Warrants (in shares) | 522,009 | 522,009 | ||||
Warrant liabilities | $ 11,500 | |||||
Gelesis | Series A4 Redeemable Convertible Preferred Stock Warrant [Member] | ||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||
Warrants outstanding | 708,493 | 708,493 | ||||
Gelesis | Warrants and Rights Subject to Mandatory Redemption | Series A4 Redeemable Convertible Preferred Stock Warrant [Member] | ||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||
Sale of Private Placement Warrants (in shares) | 719,670 | |||||
Exercise price of warrants | $ 0.04 | |||||
Warrant liabilities | $ 15,800 | $ 8,600 | $ 1,700 | |||
Number of shares issued upon exercise of warrants | 11,177 | |||||
Fair value of warrants exercised | $ 100 | |||||
Warrants outstanding | 708,493 | 708,493 |
Warrants - Series 3 Growth Warr
Warrants - Series 3 Growth Warrants (Details) - USD ($) $ in Thousands | 1 Months Ended | ||||||
Oct. 31, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jul. 07, 2020 | |
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||||
Warrant liabilities | $ 1,130 | ||||||
Sale of Private Placement Warrants (in shares) | 24,333,365 | 1,353,062 | 7,520,000 | ||||
Gelesis | |||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||||
Warrant liabilities | $ 11,500 | ||||||
Sale of Private Placement Warrants (in shares) | 522,009 | 522,009 | |||||
Gelesis | Warrants and Rights Subject to Mandatory Redemption | Series 3 Growth redeemable convertible preferred stock -"Series 3 Growth" | |||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||||
Warrant issued as percentage of shares of capital stock outstanding | 2.70% | ||||||
Warrants expiration term | 30 days | ||||||
Proceeds from sale of equity investment | $ 50,000 | $ 50,000 | |||||
Warrant liabilities | $ 6,000 | $ 4,600 | |||||
Gain on warrant liability extinguishment | $ 200 | ||||||
Warrants outstanding | 478,828 | ||||||
Gelesis | Warrants and Rights Subject to Mandatory Redemption | Series 3 Growth redeemable convertible preferred stock -"Series 3 Growth" | Minimum | |||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||||
Warrant liabilities | $ 4,700 | ||||||
Gelesis | Warrants and Rights Subject to Mandatory Redemption | Series 4 Growth Redeemable Convertible Preferred Stock Options [Member] | |||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||||
Warrants expiration term | 1 year |
Warrants - Series 4 Growth Opti
Warrants - Series 4 Growth Options (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | |||||
Dec. 31, 2020 | Dec. 31, 2019 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2019 | |
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||||||
Granted | $ 3.35 | |||||||||
Common stock options outstanding | 14,633,074 | 14,633,074 | 12,674,486 | |||||||
Change in fair value of warrant liabilities | $ (2,600,000) | $ 4,977,000 | $ (6,084,000) | $ 7,051,000 | $ 12,406,208 | $ (7,602,367) | ||||
Liabilities Current | $ 69,279,000 | $ 69,279,000 | $ 101,536,000 | |||||||
Gelesis | ||||||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||||||
Granted | $ 18.52 | |||||||||
Common stock options outstanding | 5,034,858 | 5,034,858 | 4,889,820 | 5,034,858 | ||||||
Change in fair value of warrant liabilities | $ 7,646,000 | $ 1,466,000 | ||||||||
Liabilities Current | $ 17,522,000 | $ 17,522,000 | $ 101,536,000 | $ 17,522,000 | ||||||
Gelesis | Warrants and Rights Subject to Mandatory Redemption | Series 4 Growth redeemable convertible preferred stock -"Series 4 Growth" | ||||||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||||||
Granted | $ 20.72 | |||||||||
Warrants expiration term | 1 year | |||||||||
Number of options issued | 2,419,573 | 2,371,812 | ||||||||
Change in fair value of warrant liabilities | $ 1,400,000 | |||||||||
Liabilities Current | $ 700,000 | |||||||||
Gelesis | Warrants and Rights Subject to Mandatory Redemption | Series 3 Growth redeemable convertible preferred stock | ||||||||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||||||||
Warrants expiration term | 30 days | |||||||||
Number of options issued | 2,973,270 | 2,845,625 |
Warrants - Common Stock Warrant
Warrants - Common Stock Warrants (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Oct. 31, 2020 | Dec. 31, 2020 | Jun. 30, 2022 | Dec. 31, 2021 | Jul. 07, 2020 | |
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||
Sale of Private Placement Warrants (in shares) | 24,333,365 | 1,353,062 | 7,520,000 | ||
Gelesis | |||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||
Sale of Private Placement Warrants (in shares) | 522,009 | 522,009 | |||
Exercise/Issuance of warrants | $ 4,322 | ||||
Gelesis | Warrants and Rights Subject to Mandatory Redemption | Common stock | |||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||
Sale of Private Placement Warrants (in shares) | 522,009 | ||||
Exercise/Issuance of warrants | $ 4,300 |
Redeemable Convertible Prefer_3
Redeemable Convertible Preferred Stock (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Aug. 31, 2020 | Jun. 30, 2020 | Apr. 30, 2020 | Dec. 31, 2019 | Apr. 30, 2019 | Feb. 28, 2018 | Dec. 31, 2015 | Apr. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2012 | May 31, 2011 | Apr. 30, 2011 |
Legacy Gelesis Redeemable Convertible Preferred Stock | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 51,730,762 | 0 | |||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 0 | 48,566,655 | 48,566,655 | 48,566,655 | 47,813,946 | ||||||||||||
Redeemable convertible preferred stock | $ 311,594 | ||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 0 | 48,566,655 | |||||||||||||||
Gelesis | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 19,957,625 | 19,957,625 | |||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 18,446,525 | ||||||||||||||||
Liquidation Preference | $ 257,424 | ||||||||||||||||
Redeemable convertible preferred stock | $ 213,525 | ||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 18,446,525 | ||||||||||||||||
Gelesis | Legacy Gelesis Redeemable Convertible Preferred Stock | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 19,957,625 | ||||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 18,736,936 | ||||||||||||||||
Liquidation Preference | $ 258,370 | ||||||||||||||||
Redeemable convertible preferred stock | $ 311,594 | ||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 18,736,936 | ||||||||||||||||
Gelesis | Series A-1 | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 1,711,755 | 1,711,755 | |||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 1,689,193 | 1,636,971 | 1,636,971 | ||||||||||||||
Liquidation Preference | $ 7,505 | $ 7,273 | |||||||||||||||
Redeemable convertible preferred stock | $ 7,113 | $ 6,176 | $ 6,176 | ||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 1,689,193 | 1,636,971 | 1,636,971 | ||||||||||||||
Gelesis | Series A-2 | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 1,161,254 | 1,161,254 | |||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 1,161,254 | 1,161,254 | 1,161,254 | ||||||||||||||
Liquidation Preference | $ 3,030 | $ 3,030 | |||||||||||||||
Redeemable convertible preferred stock | $ 3,033 | $ 3,033 | $ 3,033 | ||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 1,161,254 | 1,161,254 | 409,440 | ||||||||||||||
Gelesis | Series A-3 | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 1,730,874 | 1,730,874 | |||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 1,730,874 | 1,492,685 | 1,492,685 | ||||||||||||||
Liquidation Preference | $ 5,188 | $ 4,474 | |||||||||||||||
Redeemable convertible preferred stock | $ 7,460 | $ 4,463 | $ 4,463 | ||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 1,730,874 | 1,492,685 | 1,017,648 | ||||||||||||||
Gelesis | Series A-4 | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 2,159,022 | 2,159,022 | |||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 1,450,529 | 1,450,529 | 1,439,352 | ||||||||||||||
Liquidation Preference | $ 5,473 | $ 5,473 | |||||||||||||||
Redeemable convertible preferred stock | $ 2,602 | $ 2,602 | $ 2,466 | ||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 1,450,529 | 1,450,529 | |||||||||||||||
Gelesis | Series A-5 | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 1,977,114 | 1,977,114 | |||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 1,977,114 | 1,977,114 | 1,977,114 | ||||||||||||||
Liquidation Preference | $ 24,536 | $ 24,536 | |||||||||||||||
Redeemable convertible preferred stock | $ 44,307 | $ 24,991 | $ 24,536 | ||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 1,977,114 | 1,977,114 | 2,538,274 | 33,949 | 1,450,265 | ||||||||||||
Gelesis | Series Growth | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 2,538,274 | 2,538,274 | |||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 2,538,274 | 2,538,274 | 2,538,274 | ||||||||||||||
Liquidation Preference | $ 31,500 | $ 31,500 | |||||||||||||||
Redeemable convertible preferred stock | $ 56,959 | $ 32,763 | $ 31,500 | ||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 2,538,274 | 2,538,274 | |||||||||||||||
Gelesis | Series 2 Growth | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 2,370,803 | 2,370,803 | |||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 2,370,803 | 2,370,803 | 2,370,803 | ||||||||||||||
Liquidation Preference | $ 30,370 | $ 30,370 | |||||||||||||||
Redeemable convertible preferred stock | $ 53,201 | $ 30,684 | $ 30,370 | ||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 2,370,803 | 2,370,803 | 409,574 | 1,561,280 | |||||||||||||
Gelesis | Series 3 Growth | |||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||
Redeemable convertible preferred stock, shares authorized | 6,308,529 | 6,308,529 | |||||||||||||||
Conversion of all classes of redeemable convertible preferred stock | 5,818,895 | 5,818,895 | 2,973,270 | ||||||||||||||
Liquidation Preference | $ 150,768 | $ 150,768 | |||||||||||||||
Redeemable convertible preferred stock | $ 136,919 | $ 108,813 | $ 51,348 | ||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | 5,818,895 | 5,818,895 | 868,558 | 1,158,077 | 818,990 |
Redeemable Convertible Prefer_4
Redeemable Convertible Preferred Stock - Narrative (Details) | 1 Months Ended | 11 Months Ended | 12 Months Ended | |||||||||||||||||||||
Apr. 30, 2021 USD ($) shares | Mar. 31, 2021 USD ($) shares | Oct. 31, 2020 USD ($) shares | Aug. 31, 2020 USD ($) shares | Jun. 30, 2020 USD ($) shares | Apr. 30, 2020 USD ($) shares | Dec. 31, 2019 USD ($) $ / shares shares | Apr. 30, 2019 USD ($) shares | Dec. 31, 2018 USD ($) shares | Sep. 30, 2018 USD ($) shares | Jun. 30, 2018 USD ($) shares | Feb. 28, 2018 USD ($) $ / shares shares | Dec. 31, 2015 USD ($) $ / shares shares | Apr. 30, 2015 USD ($) $ / shares shares | Mar. 31, 2015 USD ($) $ / shares shares | Aug. 31, 2013 USD ($) $ / shares shares | Jun. 30, 2012 USD ($) $ / shares shares | May 31, 2011 USD ($) $ / shares shares | Apr. 30, 2011 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) shares | Jun. 30, 2022 shares | Jul. 07, 2020 shares | |
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Issuance costs | $ 671,828 | |||||||||||||||||||||||
Warrants to purchase common stock | shares | 1,353,062 | 24,333,365 | 7,520,000 | |||||||||||||||||||||
Series A4 Redeemable Convertible Preferred Stock [Member] | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Warrants to purchase common stock | shares | 1,836,429 | |||||||||||||||||||||||
Gelesis | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 18,446,525 | 18,446,525 | ||||||||||||||||||||||
Issuance costs | $ 0 | $ 329,000 | ||||||||||||||||||||||
Other income, net | $ 781,000 | $ 6,000,000 | ||||||||||||||||||||||
Warrants to purchase common stock | shares | 522,009 | 522,009 | 522,009 | |||||||||||||||||||||
Conversion price of debt securities | $ / shares | $ 17.27 | |||||||||||||||||||||||
Income (loss) on fair value of tranche rights | $ 256,000 | |||||||||||||||||||||||
Proceeds from IPO | $ 50,000,000 | |||||||||||||||||||||||
Gelesis | Series A-1 | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 1,636,971 | 1,636,971 | 1,689,193 | 1,636,971 | ||||||||||||||||||||
Shares issued on Conversion of debt | shares | 52,222 | 1,636,971 | ||||||||||||||||||||||
Exercise of warrants | $ 900,000 | |||||||||||||||||||||||
Outstanding Principal and Interest | $ 3,200,000 | |||||||||||||||||||||||
Deferred Interest | $ 400,000 | |||||||||||||||||||||||
Share issuance price | $ / shares | $ 4.44 | |||||||||||||||||||||||
Fair Value of debt | $ 3,200,000 | |||||||||||||||||||||||
Warrants to purchase common stock | shares | 74,784 | 74,784 | ||||||||||||||||||||||
Preferred stock liquidation preference per share | $ / shares | $ 4.44 | |||||||||||||||||||||||
Gelesis | Series A-2 | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 409,440 | 1,161,254 | 1,161,254 | 1,161,254 | ||||||||||||||||||||
Outstanding Principal and Interest | $ 700,000 | |||||||||||||||||||||||
Share issuance price | $ / shares | $ 2.61 | |||||||||||||||||||||||
Gross proceeds from issuance of Convertible shares | $ 1,100,000 | |||||||||||||||||||||||
Fair Value of debt | $ 700,000 | |||||||||||||||||||||||
Preferred stock liquidation preference per share | $ / shares | $ 2.61 | |||||||||||||||||||||||
Gelesis | Series A-2 | Convertible notes issued in 2011 | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Shares issued on Conversion of debt | shares | 284,249 | |||||||||||||||||||||||
Conversion of convertible promissory notes and accrued interest into redeemable convertible preferred stock | $ 600,000 | |||||||||||||||||||||||
Conversion price of preferred stock | $ / shares | $ 1.96 | |||||||||||||||||||||||
Gross proceeds from issuance of Convertible shares | $ 700,000 | |||||||||||||||||||||||
Gelesis | Series A-2 | 2008 Loan | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Shares issued on Conversion of debt | shares | 191,625 | |||||||||||||||||||||||
Deferred Interest | $ 500,000 | |||||||||||||||||||||||
Share issuance price | $ / shares | $ 2.61 | |||||||||||||||||||||||
Gelesis | Series A-2 | Pure Tech | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Shares issued on Conversion of debt | shares | 275,940 | |||||||||||||||||||||||
Gelesis | Series A3 Redeemable Convertible Preferred Stock [Member] | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 1,017,648 | 1,492,685 | 1,730,874 | 1,492,685 | ||||||||||||||||||||
Exercise of warrants | $ 3,000,000 | |||||||||||||||||||||||
Share issuance price | $ / shares | $ 3 | |||||||||||||||||||||||
Gross proceeds from issuance of Convertible shares | $ 3,100,000 | |||||||||||||||||||||||
Issuance costs | $ 10,000 | |||||||||||||||||||||||
Warrants to purchase common stock | shares | 238,189 | 238,189 | 238,189 | |||||||||||||||||||||
Preferred stock liquidation preference per share | $ / shares | $ 3 | |||||||||||||||||||||||
Gelesis | Series A3 Redeemable Convertible Preferred Stock [Member] | Promissory note issued in 2012 | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Shares issued on Conversion of debt | shares | 219,792 | |||||||||||||||||||||||
Outstanding Principal and Interest | $ 700,000 | |||||||||||||||||||||||
Fair Value of debt | $ 700,000 | |||||||||||||||||||||||
Gelesis | Series A3 Redeemable Convertible Preferred Stock [Member] | Bridge loan | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Shares issued on Conversion of debt | shares | 255,245 | |||||||||||||||||||||||
Outstanding Principal and Interest | $ 700,000 | |||||||||||||||||||||||
Conversion price of preferred stock | $ / shares | $ 2.85 | |||||||||||||||||||||||
Fair Value of debt | $ 700,000 | |||||||||||||||||||||||
Gelesis | Series A4 Redeemable Convertible Preferred Stock [Member] | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 1,450,529 | 1,450,529 | 1,450,529 | |||||||||||||||||||||
Number of Common shares issued per unit | shares | 1,439,352 | |||||||||||||||||||||||
Gross proceeds from issuance of Convertible shares | $ 4,300,000 | |||||||||||||||||||||||
Issuance costs | 11,000 | |||||||||||||||||||||||
Fair value of common stock | $ 2,500,000 | |||||||||||||||||||||||
Warrants to purchase common stock | shares | 708,493 | 708,493 | 708,493 | |||||||||||||||||||||
Preferred stock liquidation preference per share | $ / shares | $ 3.77 | |||||||||||||||||||||||
Gelesis | Series A4 Redeemable Convertible Preferred Stock [Member] | LLC Common Warrants | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Share issuance price | $ / shares | $ 3 | |||||||||||||||||||||||
Percentage of purchase of one Share of common stock | 50 | |||||||||||||||||||||||
Fair value of common stock | $ 100,000 | |||||||||||||||||||||||
Gelesis | Series A4 Redeemable Convertible Preferred Stock [Member] | Series A4 warrants | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Shares issued on Conversion of debt | shares | 11,177 | |||||||||||||||||||||||
Percentage of purchase of one Share of common stock | 50 | |||||||||||||||||||||||
Fair value of warrant | $ 100,000 | $ 1,700,000 | ||||||||||||||||||||||
Gelesis | Series A-5 | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 2,538,274 | 33,949 | 1,450,265 | 1,977,114 | 1,977,114 | 1,977,114 | ||||||||||||||||||
Shares issued on Conversion of debt | shares | 492,900 | |||||||||||||||||||||||
Outstanding Principal and Interest | $ 4,300,000 | |||||||||||||||||||||||
Share issuance price | $ / shares | $ 12.41 | $ 12.41 | $ 12.41 | |||||||||||||||||||||
Conversion price of preferred stock | $ / shares | $ 8.69 | |||||||||||||||||||||||
Gross proceeds from issuance of Convertible shares | $ 31,500,000 | $ 400,000 | $ 18,000,000 | |||||||||||||||||||||
Fair Value of debt | 4,300,000 | |||||||||||||||||||||||
Issuance costs | $ 100,000 | $ 100,000 | ||||||||||||||||||||||
Preferred stock liquidation preference per share | $ / shares | $ 12.41 | |||||||||||||||||||||||
Gelesis | Series Growth | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 2,538,274 | 2,538,274 | 2,538,274 | |||||||||||||||||||||
Preferred stock liquidation preference per share | $ / shares | $ 12.41 | |||||||||||||||||||||||
Gelesis | Series 2 Growth | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 409,574 | 1,561,280 | 2,370,803 | 2,370,803 | 2,370,803 | |||||||||||||||||||
Share issuance price | $ / shares | $ 12.81 | |||||||||||||||||||||||
Number of Convertible shares issued per unit | shares | 9,269 | |||||||||||||||||||||||
Gross proceeds from issuance of Convertible shares | $ 5,200,000 | $ 100,000 | $ 10,000,000 | |||||||||||||||||||||
Issuance costs | $ 0 | $ 0 | $ 6,000 | $ 200,000 | ||||||||||||||||||||
Preferred stock liquidation preference per share | $ / shares | $ 12.81 | |||||||||||||||||||||||
Gelesis | Series 2 Growth Tranche Rights | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 390,320 | 390,320 | 390,320 | |||||||||||||||||||||
Gross proceeds from issuance of Convertible shares | $ 5,000,000 | |||||||||||||||||||||||
Fair value of tranche rights | $ 5,000,000 | $ 5,000,000 | ||||||||||||||||||||||
Gelesis | Series 2 Growth Initial Purchasers | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 780,640 | |||||||||||||||||||||||
Gross proceeds from issuance of Convertible shares | $ 20,000,000 | |||||||||||||||||||||||
Gelesis | Series 2 Growth Subsequent Purchasers | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Issuance costs | $ 7,000 | |||||||||||||||||||||||
Gelesis | Series 3 Growth | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Class A common stock subject to possible redemption, issued (in shares) | shares | 868,558 | 1,158,077 | 818,990 | 5,818,895 | 5,818,895 | 5,818,895 | ||||||||||||||||||
Share issuance price | $ / shares | $ 17.27 | |||||||||||||||||||||||
Number of Convertible shares issued per unit | shares | 2,269,831 | |||||||||||||||||||||||
Gross proceeds from issuance of Convertible shares | $ 15,000,000 | $ 20,000,000 | $ 14,100,000 | $ 39,200,000 | ||||||||||||||||||||
Issuance costs | $ 100,000 | $ 200,000 | $ 26,000 | $ 300,000 | ||||||||||||||||||||
Number of shares issued upon conversion | shares | 775,911 | 775,911 | ||||||||||||||||||||||
Proceeds from convertible debt | $ 13,400,000 | |||||||||||||||||||||||
Fair value of Preferred Stock price Per Share | $ / shares | $ 17.09 | |||||||||||||||||||||||
Fair value of tranche rights | $ 100,000 | |||||||||||||||||||||||
Income (loss) on settlement of remaining tranche rights | $ 300,000 | |||||||||||||||||||||||
Preferred stock liquidation preference per share | $ / shares | $ 17.27 | |||||||||||||||||||||||
Gelesis | Series 4 Growth | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Preferred stock liquidation preference per share | $ / shares | $ 20.72 | |||||||||||||||||||||||
Gelesis | Common Stock | ||||||||||||||||||||||||
Temporary Equity [Line Items] | ||||||||||||||||||||||||
Fair value of common stock | $ 100,000 |
Common Stock - common stock res
Common Stock - common stock reserved for future issuance - (Details) - shares | Jun. 30, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Jul. 07, 2020 |
Common Stock | |||||
Common stock options outstanding | 14,633,074 | 12,674,486 | |||
Preferred stock, shares outstanding | 0 | 0 | 0 | ||
Sale of Private Placement Warrants (in shares) | 24,333,365 | 1,353,062 | 7,520,000 | ||
Total common stock reserved for future issuance | 67,816,703 | 65,242,854 | |||
Series A-4 | |||||
Common Stock | |||||
Sale of Private Placement Warrants (in shares) | 1,836,429 | ||||
Gelesis | |||||
Common Stock | |||||
Common stock options outstanding | 4,889,820 | 5,034,858 | |||
Sale of Private Placement Warrants (in shares) | 522,009 | 522,009 | |||
Total common stock reserved for future issuance | 25,170,612 | 25,024,858 | |||
Gelesis | Restricted Stock Units R S U [Member] | |||||
Common Stock | |||||
Common stock options outstanding | 5,203,174 | 5,034,858 | |||
Gelesis | Legacy Gelesis Redeemable Convertible Preferred Stock | |||||
Common Stock | |||||
Preferred stock, shares outstanding | 18,736,936 | 18,446,525 | |||
Gelesis | Series A-1 | |||||
Common Stock | |||||
Sale of Private Placement Warrants (in shares) | 74,784 | ||||
Gelesis | Series A-3 | |||||
Common Stock | |||||
Sale of Private Placement Warrants (in shares) | 238,189 | 238,189 | |||
Gelesis | Series A-4 | |||||
Common Stock | |||||
Sale of Private Placement Warrants (in shares) | 708,493 | 708,493 |
Stock-Based Compensation -2016
Stock-Based Compensation -2016 Stock Option Plan (Details) - shares | 1 Months Ended | ||||
Jun. 30, 2020 | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jan. 01, 2019 | |
Weighted average assumptions | |||||
Total common stock reserved for future issuance | 67,816,703 | 65,242,854 | |||
Gelesis | |||||
Weighted average assumptions | |||||
Total common stock reserved for future issuance | 25,170,612 | 25,024,858 | |||
Gelesis | Stock Option Plan 2016 | |||||
Weighted average assumptions | |||||
Number of shares authorized | 4,018,185 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Number of Shares, Period Increase (Decrease) | 5,634,251 | ||||
Total common stock reserved for future issuance | 73,164 | 496,542 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Number of options | |||
Number of Options, Outstanding | 12,674,486 | ||
Granted | 2,658,185 | ||
Exercised | (162,064) | ||
Forfeited | (63,718) | ||
Expired | (456,534) | ||
Number of Options, Outstanding | 14,633,074 | 12,674,486 | |
Exercisable at December 31, 2021 | 9,780,237 | ||
Weighted Average Exercise Price | |||
Weighted- Average Exercise Price per Share, Outstanding | $ 4.01 | ||
Granted | 3.35 | ||
Exercised | 0.68 | ||
Forfeited | 4.31 | ||
Expired | 1.23 | ||
Weighted- Average Exercise Price per Share, Outstanding | 4.01 | $ 4.01 | |
Exercisable at December 31, 2021 | $ 3.81 | ||
Weighted Average Remaining Contractual Life (in years) | |||
Outstanding | 6 years 7 months 28 days | 6 years 2 months 1 day | |
Exercisable at December 31, 2021 | 5 years 5 months 4 days | ||
Aggregate Intrinsic Value | |||
Outstanding | $ 840 | $ 54,449 | |
Exercisable at December 31, 2021 | 840 | ||
Fair value of options vested | $ 840 | ||
Gelesis | |||
Number of options | |||
Number of Options, Outstanding | 4,889,820 | 5,034,858 | |
Granted | 518,684 | ||
Exercised | (255,062) | ||
Forfeited | (68,090) | ||
Expired | (340,570) | ||
Number of Options, Outstanding | 4,889,820 | 5,034,858 | |
Exercisable at December 31, 2021 | 3,704,417 | ||
Nonvested at December 31, 2021 | 1,185,403 | ||
Weighted Average Exercise Price | |||
Weighted- Average Exercise Price per Share, Outstanding | $ 10.39 | $ 9.26 | |
Granted | 18.52 | ||
Exercised | 0.57 | ||
Forfeited | 10.98 | ||
Expired | 1.49 | ||
Weighted- Average Exercise Price per Share, Outstanding | 10.39 | $ 9.26 | |
Exercisable at December 31, 2021 | 9.21 | ||
Nonvested at December 31, 2021 | $ 14.10 | ||
Weighted Average Remaining Contractual Life (in years) | |||
Outstanding | 6 years 2 months 1 day | 6 years 1 month 13 days | |
Exercisable at December 31, 2021 | 5 years 3 months 10 days | ||
Nonvested at December 31, 2021 | 8 years 11 months 12 days | ||
Aggregate Intrinsic Value | |||
Exercised | $ 5,304 | ||
Outstanding | 54,449 | $ 14,742 | |
Exercisable at December 31, 2021 | 45,211 | ||
Nonvested at December 31, 2021 | 9,238 | ||
Gelesis | Stock options | |||
Aggregate Intrinsic Value | |||
Fair value of options vested | $ 5,500 | $ 3,100 |
Stock-Based Compensation - St_2
Stock-Based Compensation - Stock-based compensation expense (Details) - Gelesis - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Weighted average assumptions | ||
Total | $ 5,532 | $ 4,808 |
Research and Development Expense | ||
Weighted average assumptions | ||
Total | 1,565 | 1,960 |
General And Administrative Expense [Member] | ||
Weighted average assumptions | ||
Total | $ 3,967 | $ 2,848 |
Stock-Based Compensation - Weig
Stock-Based Compensation - Weighted-average assumptions (Details) - USD ($) $ / shares in Units, $ in Millions | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Weighted average assumptions | |||
Expected volatility | 0.724% | ||
Expected term (in years) | 6 years 1 month 6 days | ||
Risk-free interest rate | 0.017% | ||
Expected dividend yield | 0% | ||
Options and RSUs to acquire common stock | Stock Option Plan 2016 | |||
Weighted average assumptions | |||
Weighted-average period | 1 year 8 months 12 days | 2 years 2 months 12 days | |
Gelesis | |||
Weighted average assumptions | |||
Fair value of common stock | $ 20.02 | $ 11.18 | |
Expected volatility | 60.10% | 63.60% | |
Expected term (in years) | 5 years 9 months 18 days | 5 years 9 months 18 days | |
Risk-free interest rate | 1.10% | 0.20% | |
Expected dividend yield | 0% | 0% | |
Gelesis | Options and RSUs to acquire common stock | |||
Weighted average assumptions | |||
Weighted-average grant date fair value of stock options granted | $ 11.25 | $ 6.31 | |
Gelesis | Options and RSUs to acquire common stock | Stock Option Plan 2016 | |||
Weighted average assumptions | |||
Unrecognized compensation cost | $ 8.7 | $ 8.7 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Unit (Details) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2021 EUR (€) shares | Dec. 31, 2020 USD ($) | |
Restricted Stock Units R S U [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Restricted stock units issued during the year | shares | 4,555,197 | |||
Weighted-average fair value of restricted stock units | $ / shares | $ 3.46 | |||
Gelesis | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Recognized share based compensation expense | $ 5,532 | $ 4,808 | ||
Gelesis | General And Administrative Expense [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Recognized share based compensation expense | $ 3,967 | $ 2,848 | ||
Gelesis | Restricted Stock Units R S U [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Weighted-average fair value of restricted stock units | $ / shares | $ 21.41 | |||
Number of shares for each RSU | 1 | 1 | ||
Gelesis | Restricted Stock Units R S U [Member] | Employees | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Restricted stock units issued during the year | shares | 313,354 | 313,354 | ||
Unrecognized share based compensation cost | $ 6,700 | |||
Gelesis | Restricted Stock Units R S U [Member] | General And Administrative Expense [Member] | Nonemployees | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Recognized share based compensation expense | € | € 36,000 |
Income Taxes - Summary of Conso
Income Taxes - Summary of Consolidated (loss) income before income taxes on a geographic basis (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Loss before income taxes | $ (12,513) | $ (24,739) | $ (18,216) | $ (43,308) | ||
Gelesis | ||||||
United States | $ (86,693) | $ (19,658) | ||||
Non-U.S | (6,637) | (4,208) | ||||
Loss before income taxes | $ (93,330) | $ (23,866) |
Income Taxes - Schedule of (ben
Income Taxes - Schedule of (benefit from) provision for income taxes (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Deferred tax (benefit) expense: | |||||||
U.S. federal | $ 465,518 | $ 28,719 | |||||
Income tax provision | $ 0 | $ 0 | $ 0 | $ 17,000 | $ 0 | 0 | |
Gelesis | |||||||
Current tax expense: | |||||||
Foreign | 17,000 | $ (24,000) | |||||
Total current tax expense (benefit) | 17,000 | (24,000) | |||||
Deferred tax (benefit) expense: | |||||||
Foreign | 2,063,000 | ||||||
Total deferred tax benefit | 2,063,000 | ||||||
Income tax provision | $ 17,000 | $ 2,039,000 |
Income Taxes - Schedule of reco
Income Taxes - Schedule of reconciliation setting forth the differences between the effective tax rates (Details) | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
U.S statutory rate | 21% | 21% | 21% | 21% | 21% | 21% | |
State taxes net of federal benefit | 0% | 0% | |||||
Valuation allowance | (21.00%) | (0.19%) | |||||
Other differences | 0% | 12.38% | |||||
Income tax provision | 0% | 0% | |||||
Gelesis | |||||||
U.S statutory rate | 21% | 21% | |||||
Effect of nondeductible stock-based compensation | 0.80% | (1.90%) | |||||
Foreign rate differential | 0.20% | 2.20% | |||||
Mark to market of warrant liabilities | (1.70%) | (1.30%) | |||||
State taxes net of federal benefit | 4.30% | 4.50% | |||||
Non-deductible financing expenses | (0.30%) | 0.40% | |||||
Valuation allowance | (24.20%) | (38.30%) | |||||
Investment transfer | 0% | 6.80% | |||||
Other differences | (0.40%) | (0.40%) | |||||
US federal and state research credits | 0.40% | 1.60% | |||||
Uncertain tax positions | (0.10%) | (1.10%) | |||||
Foreign earnings includible in US | 0% | (2.00%) | |||||
Income tax provision | 0% | (8.50%) |
Income Taxes - Significant comp
Income Taxes - Significant components of the Company's consolidated deferred tax assets and liabilities (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets: | ||
Total deferred tax assets | $ 494,236 | $ 465,518 |
Valuation allowance | (494,236) | (465,518) |
Deferred tax assets, net of valuation allowance | 0 | 0 |
Gelesis | ||
Deferred tax assets: | ||
Federal net operating loss carryforwards | 40,469,000 | 24,730,000 |
State net operating loss carryforwards | 10,643,000 | 7,207,000 |
Equity compensation | 5,620,000 | 4,353,000 |
Accruals and reserves | 26,000 | |
Uncollected grants | 998,000 | 712,000 |
Investment in subsidiaries | 3,820,000 | 3,931,000 |
Research credits | 1,578,000 | 1,298,000 |
Other assets | 152,000 | 46,000 |
Deferred income | 239,000 | |
Interest | 257,000 | |
Deferred rent | 547,000 | 600,000 |
Total deferred tax assets | 64,323,000 | 42,903,000 |
Valuation allowance | (59,841,000) | (37,427,000) |
Deferred tax assets, net of valuation allowance | 4,482,000 | 5,476,000 |
Deferred tax liabilities: | ||
Intangible assets and amortization | (3,932,000) | (4,680,000) |
Right-of-Use asset | (536,000) | (591,000) |
Other liabilities | (14,000) | (204,000) |
Total deferred tax liabilities | $ (4,482,000) | $ (5,476,000) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of the beginning and ending amount of uncertain tax positions (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Unrecognized tax benefits at the end of year | $ 0 | |
Gelesis | ||
Unrecognized tax benefits at the beginning of year | (281,000) | |
Increase for current year positions | 71,000 | $ 82,000 |
Increase for prior year positions | 199,000 | |
Unrecognized tax benefits at the end of year | (352,000) | (281,000) |
Gross research credit tax assets | 1,930,000 | 1,579,000 |
Net research credit tax assets | $ 1,578,000 | $ 1,298,000 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 1 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2022 | |
Operating Loss Carryforwards [Line Items] | ||||||
Other long-term liabilities | $ 5,588,000 | $ 5,908,000 | ||||
Change in valuation allowance | $ 5,783,000 | $ 465,518 | 28,719 | |||
Gelesis | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
Operating loss carryforward, Domestic | 24,730,000 | 40,469,000 | $ 24,730,000 | |||
Operating loss carryforward, State | 7,207,000 | 10,643,000 | 7,207,000 | |||
Other long-term liabilities | 11,729,000 | 5,588,000 | 11,729,000 | |||
Change in valuation allowance | $ 5,783,000 | 22,400,000 | 9,100,000 | |||
Deferred tax liability recognized for intangible asset acquired | $ 5,800,000 | $ 5,800,000 | ||||
Accumulated undistributed earnings of foreign subsidiaries | 7,500,000 | |||||
Estimated interest or penalties on Uncertain tax position | 0 | 0 | ||||
Gelesis | Gelesis S.R.L | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
Provision for deferred tax asset | 2,000,000 | |||||
Gelesis | Year 2027 through 2037 | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
Operating loss carryforward, Domestic | 114,400,000 | 184,600,000 | 114,400,000 | |||
Operating loss carry forward, Subject to Expiration | 63,500,000 | |||||
Operating loss carry forward, Not Subject to Expiration | 121,100,000 | |||||
Gelesis | Tax Year 2030 Through 2041 [Member] | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
Operating loss carryforward, State | $ 114,000,000 | 168,400,000 | $ 114,000,000 | |||
Operating loss carryforward, Foreign | $ 7,100,000 |
Earnings (Loss) per Share (Deta
Earnings (Loss) per Share (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | |||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Numerator:. | |||||||||
Net income (loss) | $ (12,513,000) | $ (5,703,000) | $ (24,739,000) | $ (18,586,000) | $ (18,216,000) | $ (43,325,000) | $ (15,294,860) | $ (12,898,082) | |
Accretion of redeemable convertible preferred stock to redemption value | (82,365,000) | (37,934,000) | (116,126,000) | ||||||
Accretion of noncontrolling interest put option to redemption value | (85,000) | (96,000) | (173,000) | (190,000) | |||||
Net loss attributable to common stockholders | $ (12,598,000) | $ (107,200,000) | $ (56,323,000) | $ (159,641,000) | |||||
Gelesis | |||||||||
Numerator:. | |||||||||
Net income (loss) | (93,347,000) | $ (25,905,000) | |||||||
Accretion of redeemable convertible preferred stock to redemption value | (94,134,000) | (11,372,000) | |||||||
Accretion of noncontrolling interest put option to redemption value | (376,000) | (567,000) | |||||||
Net loss attributable to common stockholders | $ (187,857,000) | $ (37,844,000) | |||||||
Denominator:. | |||||||||
Weighted average common shares outstanding - basic | 2,204,486 | 2,149,182 | |||||||
Weighted average common shares outstanding - diluted | 2,204,486 | 2,149,182 | |||||||
Net loss per share, basic | $ (85.22) | $ (17.61) | |||||||
Net loss per share, diluted | $ (85.22) | $ (17.61) |
Earnings (Loss) per Share - S_2
Earnings (Loss) per Share - Schedule of Anti-Dilutive shares for computation of diluted net loss per share attributable to common stockholders (Details) - shares | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Total | 44,333,858 | 65,380,739 | 21,320,000 | |
Gelesis | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Total | 25,170,612 | 25,064,547 | ||
Gelesis | Convertible Preferred Stock [Member] | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Total | 18,736,936 | 18,446,525 | ||
Gelesis | Warrants on convertible preferred stock | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Total | 708,493 | 1,021,466 | ||
Gelesis | Options and RSUs to acquire common stock | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Total | 5,203,174 | 5,074,547 | ||
Gelesis | Warrant [Member] | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Total | 522,009 | 522,009 |
Commitments and Contingencies -
Commitments and Contingencies - Future minimum rental payments (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Future minimum rental payments, operating leases | ||
2022 | $ 629 | |
2023 | 553 | |
2024 | 383 | |
2025 | 30 | |
Total undiscounted lease maturities | 1,923 | |
Imputed interest | (151) | |
Total lease liability | $ 1,772 | |
Gelesis | ||
Future minimum rental payments, operating leases | ||
2022 | $ 634 | |
2023 | 639 | |
2024 | 555 | |
2025 | 385 | |
2026 | 33 | |
More than 5 years | 16 | |
Total undiscounted lease maturities | 2,262 | |
Imputed interest | (202) | |
Total lease liability | $ 2,060 |
Commitments and Contingencies_2
Commitments and Contingencies - Operating Leases (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 24 Months Ended | ||||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2019 | |
Operating leases | |||||||
Remaining lease term | 3 years 2 months 12 days | 3 years 2 months 12 days | 3 years 8 months 12 days | ||||
Total lease payments | $ 1,923,000 | $ 1,923,000 | |||||
Right of use assets | 1,725,000 | 1,725,000 | $ 2,016,000 | ||||
Short-term lease liabilities | 550,000 | 550,000 | 541,000 | ||||
Long-term lease liabilities | 1,222,000 | 1,222,000 | 1,519,000 | ||||
Lease expenses | $ 200,000 | $ 200,000 | $ 300,000 | $ 300,000 | |||
Weighted average discount rate | 5.90% | 5.90% | |||||
Office Space Located In Boston [Member] | |||||||
Operating leases | |||||||
Total lease payments | $ 3,200,000 | ||||||
Gelesis | |||||||
Operating leases | |||||||
Total lease payments | 2,262,000 | ||||||
Right of use assets | 2,016,000 | $ 2,167,000 | |||||
Short-term lease liabilities | 541,000 | 421,000 | |||||
Long-term lease liabilities | 1,519,000 | $ 1,780,000 | |||||
Lease expenses | $ 500,000 | ||||||
Weighted average discount rate | 5.90% | ||||||
Gelesis | Office Space Located In Boston [Member] | |||||||
Operating leases | |||||||
Total lease payments | $ 3,200,000 |
Commitments and Contingencies_3
Commitments and Contingencies (Details) | 12 Months Ended |
Dec. 31, 2009 | |
Gelesis | Royalty And Sublicense Income Agreement [Member] | Puretech [Member] | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |
Percentage of royalty on net product sales | 2% |
Commitments and Contingencies_4
Commitments and Contingencies - Royalty agreements (Details) - 12 months ended Dec. 31, 2021 - Gelesis - One S.r.l [Member] - Amended And Restated Master Agreement [Member] € in Millions, $ in Millions | EUR (€) | USD ($) |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||
Percentage of royalty on net product sales | 2% | |
Payments to be made upon the achievement of certain milestones | € 17.5 | $ 19.9 |
Commitments and contingencies_5
Commitments and contingencies - Research and Development Tax Credits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2022 | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||
Other long-term liabilities | $ 5,588 | $ 5,908 | |
Research And Development Tax Credits [Member] | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||
Other long-term liabilities | 3,000 | $ 2,800 | |
Gelesis | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||
Reduction to research and development expenses | 100 | $ 600 | |
Other long-term liabilities | 5,588 | 11,729 | |
Gelesis | Research And Development Tax Credits [Member] | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||
Other long-term liabilities | $ 3,000 | $ 3,100 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | 24 Months Ended | ||||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 13, 2021 | |
Related Party Transaction [Line Items] | ||||||||
Accounts payable, due to related party | $ 303 | $ 303 | $ 147 | $ 147 | ||||
Puretech [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt | $ 15,000 | |||||||
Puretech [Member] | Management Services Expenses [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Research and development, including related party expenses | 100 | $ 100 | $ 200 | |||||
Accounts payable, due to related party | 100 | 100 | 100 | 100 | ||||
Notes payable | 15,100 | 15,100 | ||||||
Puretech [Member] | Royalty Expense [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Research and development, including related party expenses | $ 200 | $ 100 | $ 300 | $ 100 | ||||
SSD2 [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt | 12,000 | |||||||
SSD2 [Member] | Management Services Expenses [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Notes payable | 12,100 | 12,100 | ||||||
Gelesis | ||||||||
Related Party Transaction [Line Items] | ||||||||
Research and development, including related party expenses | 447 | $ 108 | ||||||
Loan from related party | 5,664 | 109 | 5,664 | |||||
Accounts payable, due to related party | 147 | 93 | 147 | |||||
Debt | 37,081 | 37,081 | ||||||
Loss of change in fair value of the instrument | 128 | |||||||
Gelesis | Puretech [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt | 15,000 | |||||||
Gelesis | Puretech [Member] | Management Services Expenses [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Research and development, including related party expenses | 500 | |||||||
Accounts payable, due to related party | 100 | 100 | 100 | |||||
Notes payable | 15,100 | 15,100 | ||||||
Loss of change in fair value of the instrument | 100 | |||||||
Gelesis | Puretech [Member] | Royalty Expense [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Research and development, including related party expenses | 200 | $ 100 | ||||||
Gelesis | SSD2 [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt | $ 12,000 | |||||||
Loss of change in fair value of the instrument | 100 | |||||||
Gelesis | SSD2 [Member] | Management Services Expenses [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Notes payable | $ 12,100 | $ 12,100 |
Related Party Transactions - On
Related Party Transactions - One S.r.l (Details) $ in Thousands, € in Millions | 12 Months Ended | |||||
Dec. 31, 2021 USD ($) | Dec. 31, 2021 EUR (€) | Dec. 31, 2020 USD ($) | Dec. 31, 2020 EUR (€) | Jun. 30, 2022 | Jun. 30, 2019 | |
One | ||||||
Related Party Transaction [Line Items] | ||||||
Equity investment ownership percentage | 10% | 10% | ||||
Gelesis | ||||||
Related Party Transaction [Line Items] | ||||||
Research and development, including related party expenses | $ 447 | $ 108 | ||||
Loan from related party | 5,664 | 109 | ||||
Gelesis | One | ||||||
Related Party Transaction [Line Items] | ||||||
Equity investment ownership percentage | 10% | |||||
Gelesis | Consulting Agreement [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Research and development, including related party expenses | 300 | |||||
Gelesis | Founder Of One [Member] | Consulting Agreement [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Research and development, including related party expenses | 300 | |||||
Loan from related party | 100 | |||||
Gelesis | One S.r.l [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Loan from related party | 100 | 3,000 | ||||
Payments related to acquisition | $ 5,700 | € 5 | 6,100 | € 5 | ||
Gelesis | One S.r.l [Member] | One | ||||||
Related Party Transaction [Line Items] | ||||||
Equity investment ownership percentage | 10% | |||||
Gelesis | One S.r.l [Member] | Consulting Agreement [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Payments related to acquisition | 3,100 | |||||
Gelesis | One S.r.l [Member] | Royalty Expense [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Payments related to acquisition | $ 200 | $ 100 |
Related Party Transactions - CM
Related Party Transactions - CMS Agreements (Details) - Gelesis - Series 3 Growth $ in Thousands | 12 Months Ended |
Dec. 31, 2020 USD ($) shares | |
Related Party Transaction [Line Items] | |
Number of shares sold | shares | 2,845,625 |
Aggregate purchase price | $ | $ 48,125 |
Related Party Transactions - RI
Related Party Transactions - RIF Transaction (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | |
Aug. 31, 2020 | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Equity Investment That Can Be Called [Member] | ||||
Related Party Transaction [Line Items] | ||||
Annual interest rate in connection with transaction | 15% | |||
Put by Rif Transaction [Member] | ||||
Related Party Transaction [Line Items] | ||||
Annual interest rate in connection with transaction | 3.175% | |||
Gelesis | ||||
Related Party Transaction [Line Items] | ||||
Loan from related party | $ 5,664 | $ 109 | ||
Gelesis | Equity Investment That Can Be Called [Member] | ||||
Related Party Transaction [Line Items] | ||||
Annual interest rate in connection with transaction | 15% | |||
Gelesis | Put by Rif Transaction [Member] | ||||
Related Party Transaction [Line Items] | ||||
Annual interest rate in connection with transaction | 3.175% | |||
Gelesis | RIF Transaction | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from sale of equity investment | $ 12,300 | |||
Equity interest held by related party | 20% | |||
Loan from related party | $ 18,400 | |||
Fixed interest rate on loan | 6.35% | |||
Gelesis | One S.r.l [Member] | ||||
Related Party Transaction [Line Items] | ||||
Loan from related party | $ 100 | $ 3,000 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Gelesis | 401(k) Retirement plan | ||
Defined Contribution Plan Disclosure [Line Items] | ||
Plan Contributions by the Company | $ 0.2 | $ 0.2 |
Subsequent Event(s) (Details)
Subsequent Event(s) (Details) - Gelesis $ in Millions | Jan. 19, 2022 USD ($) item | Jan. 13, 2022 USD ($) |
Subsequent Event [Line Items] | ||
Gross proceeds | $ 105 | |
Convertible preferred stock exchange ratio | 2.59 | |
Subsequent Event | 2021 Bridge Financing | ||
Subsequent Event [Line Items] | ||
Repayment of debt | $ 27.3 | |
Number of existing investors | item | 2 |