Madrigal Pharmaceuticals (MDGL) 10-Q 9 May 22 2022 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	Mar. 31, 2022	May 05, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Entity Interactive Data Current	Yes
Amendment Flag	false
Document Fiscal Year Focus	2022
Document Period End Date	Mar. 31, 2022
Document Fiscal Period Focus	Q1
Entity Registrant Name	MADRIGAL PHARMACEUTICALS, INC.
Entity Central Index Key	0001157601
Entity File Number	001-33277
Current Fiscal Year End Date	--12-31
Entity Tax Identification Number	04-3508648
Entity Incorporation, State or Country Code	DE
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		17,103,395
City Area Code	267
Local Phone Number	824-2827
Trading Symbol	MDGL
Security Exchange Name	NASDAQ
Title of 12(b) Security	Common Stock, $0.0001 Par Value Per Share
Entity Address, Address Line One	Four Tower Bridge
Entity Address, Address Line Two	200 Barr Harbor Drive, Suite 200
Entity Address, City or Town	West Conshohocken
Entity Address, Postal Zip Code	19428
Entity Address, State or Province	PA

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 42,282	$ 36,269
Marketable securities	177,671	234,077
Prepaid expenses and other current assets	1,217	1,338
Total current assets	221,170	271,684
Property and equipment, net	796	851
Right-of-use asset	696	797
Total assets	222,662	273,332
Current liabilities:
Accounts payable	22,780	21,380
Accrued expenses	53,442	55,048
Lease liability	413	410
Total current liabilities	76,635	76,838
Long term liabilities:
Lease liability	283	387
Total long term liabilities	283	387
Total liabilities	76,918	77,225
Stockholders' equity:
Preferred stock, par value $0.0001 per share authorized: 5,000,000 shares at March 31, 2022 and December 31, 2021; 1,969,797 shares issued and outstanding at March 31, 2022 and December 31, 2021
Common stock, par value $0.0001 per share authorized: 200,000,000 at March 31, 2022 and December 31, 2021; 17,103,395 and 17,103,395 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively	2	2
Additional paid-in-capital	870,972	863,495
Accumulated other comprehensive gain (loss)	(402)	(80)
Accumulated deficit	(724,828)	(667,310)
Total stockholders' equity	145,744	196,107
Total liabilities and stockholders' equity	$ 222,662	$ 273,332

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	1,969,797	1,969,797
Preferred stock, shares outstanding	1,969,797	1,969,797
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	17,103,395	17,103,395
Common stock, shares outstanding	17,103,395	17,103,395

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Revenues:
Total revenues
Operating expenses:
Research and development	47,929	45,770
General and administrative	9,658	7,209
Total operating expenses	57,587	52,979
Loss from operations	(57,587)	(52,979)
Interest income	69	160
Other income		273
Net loss	$ (57,518)	$ (52,546)
Net loss per common share:
Basic and diluted net loss per common share	$ (3.36)	$ (3.32)
Basic and diluted weighted average number of common shares outstanding	17,103,395	15,840,401

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Statement of Comprehensive Income [Abstract]
Net Loss	$ (57,518)	$ (52,546)
Other comprehensive income (loss):
Unrealized gain (loss) on available-for-sale securities	(322)	(61)
Comprehensive loss	$ (57,840)	$ (52,607)

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Total	Preferred Stock	Common stock	Additional paid-in Capital	Accumulated other comprehensive income (loss)	Accumulated deficit
Balance at Dec. 31, 2020	$ 239,970		$ 2	$ 665,385	$ 47	$ (425,464)
Balance (in shares) at Dec. 31, 2020		1,969,797	15,508,146
Increase (Decrease) in Stockholders' Equity
Issuance of common shares in equity offering, excluding to related parties, net of transaction costs	66,616		$ 0	66,616
Issuance of common shares in equity offering, excluding to related parties, net of transaction costs (in shares)			550,803
Sale of common shares to related parties and exercise of common stock options, net of transaction costs	478			478
Sale of common shares to related parties and exercise of common stock options, net of transaction costs ( in shares)			4,250
Compensation expense related to stock options for services	6,096			6,096
Unrealized gain (loss) on marketable securities	(61)				(61)
Net loss	(52,546)					(52,546)
Balance at Mar. 31, 2021	260,553		$ 2	738,575	(14)	(478,010)
Balance (in shares) at Mar. 31, 2021		1,969,797	16,063,199
Balance at Dec. 31, 2021	$ 196,107		$ 2	863,495	(80)	(667,310)
Balance (in shares) at Dec. 31, 2021	17,103,395	1,969,797	17,103,395
Increase (Decrease) in Stockholders' Equity
Compensation expense related to stock options for services	$ 7,477			7,477
Unrealized gain (loss) on marketable securities	(322)				(322)
Net loss	(57,518)					(57,518)
Balance at Mar. 31, 2022	$ 145,744		$ 2	$ 870,972	$ (402)	$ (724,828)
Balance (in shares) at Mar. 31, 2022	17,103,395	1,969,797	17,103,395

Condensed Consolidated Statem_4

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Cash flows from operating activities:
Net loss	$ (57,518)	$ (52,546)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense	7,477	6,096
Depreciation and amortization expense	107	113
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	121	191
Accounts payable	1,400	3,379
Accrued expense	(1,606)	(1,147)
Accrued interest, net of interest received on maturity of investments	106	485
Net cash used in operating activities	(49,913)	(43,429)
Cash flows from investing activities:
Purchases of marketable securities	(37,567)	(93,722)
Sales and maturities of marketable securities	93,545	60,302
Purchases of property and equipment, net of disposals	(52)	(44)
Net cash provided by (used in) investing activities	55,926	(33,464)
Cash flows from financing activities:
Proceeds from issuances of stock, excluding related parties, net of transaction costs	0	66,616
Proceeds from the sale of related party stock and exercise of common stock options, net of transaction costs	0	478
Net cash provided by financing activities	0	67,094
Net increase (decrease) in cash and cash equivalents	6,013	(9,799)
Cash and cash equivalents at beginning of period	36,269	54,004
Cash and cash equivalents at end of period	$ 42,282	$ 44,205

Organization, Business and Basi

Organization, Business and Basis of Presentation	3 Months Ended
	Mar. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization, Business and Basis of Presentation	1. Organization, Business, and Basis of Presentation Organization and Business Madrigal Pharmaceuticals, Inc. (the “Company” or “Madrigal”) is a clinical-stage pharmaceutical company developing novel, high-quality, small-molecule drugs addressing major unmet needs in cardiovascular, metabolic, and liver diseases. The Company’s lead compound, resmetirom, is being advanced for non-alcoholic non-alcoholic MAESTRO-NAFLD-1 Basis of Presentation Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted. Accordingly, the unaudited condensed consolidated financial statements do not include all information and footnotes required by GAAP for complete annual financial statements. However, we believe that the disclosures included in these financial statements are adequate to make the information presented not misleading. The unaudited condensed consolidated financial statements, in the opinion of management, reflect all adjustments, which include normal recurring adjustments, necessary for a fair statement of such interim results. The interim results are not necessarily indicative of the results that we will have for the full year ending December 31, 2022 or any subsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to those statements for the year ended December 31, 2021.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2022
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Principle of Consolidation The consolidated financial statements include the financial statements of the Company and its wholly owned subsidiaries. All significant intercompany balances have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities, and the reported amounts of revenues and expenses during the reporting periods. The Company bases its estimates on historical experience and various other assumptions that management believes to be reasonable under the circumstances. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. The Company maintains its cash in bank accounts, the balance of which, at times, exceeds Federal Deposit Insurance Corporation insured limits. The primary objective of the Company’s investment activities is to preserve its capital for the purpose of funding operations and the Company does not enter into investments for trading or speculative purposes. The Company’s cash is deposited in highly rated financial institutions in the United States. The Company invests in money market funds and high-grade, commercial paper and corporate bonds, which management believes are subject to minimal credit and market risk. Marketable Securities Marketable securities consist of investments in high-grade corporate obligations and government and government agency obligations that are classified as available-for-sale. The Company adjusts the cost of available-for-sale available-for-sale Marketable securities are stated at fair value, including accrued interest, with their unrealized gains and losses included as a component of accumulated other comprehensive income or loss, which is a separate component of stockholders’ equity. The fair value of these securities is based on quoted prices and observable inputs on a recurring basis. Realized gains and losses are determined on the specific identification method. During the three months ended March 31, 2022 and 2021, the Company did not have any realized gains or losses on marketable securities. Fair Value of Financial Instruments The carrying amounts of the Company’s financial instruments, which include cash equivalents and marketable securities, approximate their fair values. The fair value of the Company’s financial instruments reflects the amounts that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy has the following three levels: Level 1—quoted prices in active markets for identical assets and liabilities. 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 that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability. Financial assets and liabilities are classified in their entirety within the fair value hierarchy based on the lowest level of input that is significant to the fair value measurement. The Company measures the fair value of its marketable securities by taking into consideration valuations obtained from third- party pricing sources. The pricing services utilize industry standard valuation models, including both income and market based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker-dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities and other observable inputs. As of March 31, 2022, the Company’s financial assets valued based on Level 1 inputs consisted of cash and cash equivalents in a money market fund, its financial assets valued based on Level 2 inputs consisted of high-grade corporate and government agency bonds and commercial paper, and it had no financial assets valued based on Level 3 inputs. During the three months ended March 31, 2022 and 2021, the Company did not have any transfers of financial assets between Levels 1 and 2. As of March 31, 2022 and December 31, 2021, the Company did not have any financial liabilities that were recorded at fair value on a recurring basis on the balance sheet. Research and Development Costs Research and development costs are expensed as incurred. Research and development costs are comprised of costs incurred in performing research and development activities, including internal costs (including stock-based compensation), costs for consultants, milestone payments under licensing agreements, and other costs associated with the Company’s preclinical and clinical programs. In particular, the Company has conducted safety studies in animals, optimized and implemented the manufacturing of our drug, and conducted Phase 1-3 Patents Costs to secure and defend patents are expensed as incurred and are classified as general and administrative expense in the Company’s consolidated statements of operations. Stock-Based Compensation The Company recognizes stock-based compensation expense based on the grant date fair value of stock options granted to employees, officers, and directors. The Company uses the Black-Scholes option pricing model to determine the grant date fair value as management believes it is the most appropriate valuation method for its option grants. The Black-Scholes model requires inputs for risk-free interest rate, dividend yield, volatility and expected lives of the options. The expected lives for options granted represent the period of time that options granted are expected to be outstanding. The Company uses the simplified method for determining the expected lives of options. Expected volatility is based upon an industry estimate or blended rate including the Company’s historical trading activity. The risk-free rate for periods within the expected life of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. The Company estimates the forfeiture rate based on historical data. This analysis is re-evaluated Certain of the employee stock options granted by the Company are structured to qualify as incentive stock options (“ISOs”). Under current tax regulations, the Company does not receive a tax deduction for the issuance, exercise or disposition of ISOs if the employee meets certain holding requirements. If the employee does not meet the holding requirements, a disqualifying disposition occurs, at which time the Company may receive a tax deduction. The Company does not record tax benefits related to ISOs unless and until a disqualifying disposition is reported. In the event of a disqualifying disposition, the entire tax benefit is recorded as a reduction of income tax expense. The Company has not recognized any income tax benefit for its share-based compensation arrangements due to the fact that the Company does not believe it is more likely than not it will realize the related deferred tax assets. Income Taxes The Company uses the asset and liability method to account for income taxes. Deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the Company’s financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates expected to be in effect in the years in which the differences are expected to reverse. The Company currently maintains a 100% valuation allowance on its deferred tax assets. Comprehensive Loss Comprehensive loss is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner Basic and Diluted Loss Per Common Share Basic net loss per share is computed using the weighted average number of common shares outstanding during the period, excluding any restricted stock that has been issued but is not yet vested. Diluted net loss per common share is computed using the weighted average number of common shares outstanding and the weighted average dilutive potential common shares outstanding using the treasury stock method. However, for the three months ended March 21, 2022 and 2021, diluted net loss per share is the same as basic net loss per share because the inclusion of weighted average shares of unvested restricted common stock, common stock issuable upon the exercise of stock options, and common stock issuable upon the conversion of preferred stock would be anti-dilutive. The following table summarizes outstanding securities not included in the computation of diluted net loss per common share, as their inclusion would be anti-dilutive: Three Months Ended March 31, 2022 2021 Common stock options 2,878,399 2,193,915 Preferred stock 1,969,797 1,969,797 Recent Accounting Pronouncements None

Liquidity and Uncertainties

Liquidity and Uncertainties	3 Months Ended
	Mar. 31, 2022
Liquidity and Uncertainties
Liquidity and Uncertainties	3. Liquidity and Uncertainties The Company is subject to risks common to development stage companies in the biopharmaceutical industry including, but not limited to, uncertainty of product development and commercialization, dependence on key personnel, uncertainty of market acceptance of products and product reimbursement, product liability, uncertain protection of proprietary technology, potential inability to raise additional financing necessary for development and commercialization, and compliance with the U.S. Food and Drug Administration and other government regulations. The Company has incurred losses since inception, including approximately $57.5 million for the three months ended March 31, 2022, resulting in an accumulated deficit of approximately $724.8 million as of March 31, 2022. Management expects to incur losses for the foreseeable future. To date, the Company has funded its operations primarily through proceeds from sales of the Company’s capital stock. The Company believes that its cash, cash equivalents and marketable securities at March 31, 2022 will be sufficient to fund operations past one year from the issuance of these financial statements. To meet its future capital needs, the Company intends to raise additional capital through debt or equity financings, collaborations, partnerships or other strategic transactions. However, there can be no assurance that the Company will be able to complete any such transactions on acceptable terms or otherwise. The inability of the Company to obtain sufficient funds on acceptable terms when needed could have a material adverse effect on the Company’s business, results of operations and financial condition. The Company has the ability to delay certain research activities and related clinical expenses if necessary due to liquidity concerns until a date when those concerns are relieved.

Cash, Cash Equivalents and Mark

Cash, Cash Equivalents and Marketable Securities	3 Months Ended
	Mar. 31, 2022
Cash and Cash Equivalents [Abstract]
Cash, Cash Equivalents and Marketable Securities	4. Cash, Cash Equivalents and Marketable Securities A summary of cash, cash equivalents and available-for-sale March 31, 2022 Cost Unrealized Unrealized Fair value Cash and cash equivalents: Cash (Level 1) $ 2,238 $ — $ — $ 2,238 Money market funds (Level 1) 40,044 — — 40,044 Total cash and cash equivalents 42,282 — — 42,282 Marketable securities: Corporate debt securities due within 1 year of date of purchase (Level 2) 170,336 — (366 ) 169,970 U.S. government and government sponsored entities due within 1 year of date of purchase (Level 2) 6,036 — (12 ) 6,024 Corporate debt securities due within 1 to 2 years of date of purchase (Level 2) 1,701 — (24 ) 1,677 Total cash, cash equivalents and marketable securities $ 220,355 $ — $ (402 ) $ 219,953 December 31, 2021 Cost Unrealized Unrealized Fair value Cash and cash equivalents: Cash (Level 1) $ 18,877 $ — $ — $ 18,877 Money market funds (Level 1) 17,392 — — 17,392 Total cash and cash equivalents 36,269 — — 36,269 Marketable securities: Corporate debt securities due within 1 year of date of purchase (Level 2) 228,348 6 (66 ) 228,288 Corporate debt securities due within 1 to 2 years of date of purchase (Level 2) 5,809 — (20 ) 5,789 Total cash, cash equivalents and marketable securities $ 270,426 $ 6 $ (86 ) $ 270,346

Accrued Liabilities

Accrued Liabilities	3 Months Ended
	Mar. 31, 2022
Accrued Liabilities, Current [Abstract]
Accrued Liabilities	5. Accrued Liabilities Accrued liabilities as of March 31, 2022 and December 31, 2021 consisted of the following (in thousands): March 31, December 31, Contract research organization costs $ 42,168 $ 38,349 Other clinical study related costs 4,103 3,957 Compensation and benefits 2,715 6,769 Professional fees 2,343 2,455 Other 2,113 3,518 Total accrued liabilities $ 53,442 $ 55,048

Stockholders' Equity

Stockholders' Equity	3 Months Ended
	Mar. 31, 2022
Stockholders' Equity Note [Abstract]
Stockholders' Equity	6. Stockholders’ Equity Common Stock Each common stockholder generally is entitled to one vote for each share of common stock held, subject to limitations as may be established for certain other classes and series of stock of the Company from time to time. Each share of common stock is entitled to receive dividends, as and when declared by the Company’s board of directors. The Company has never declared cash dividends on its common stock and does not expect to do so in the foreseeable future. Preferred Stock The Company’s Series A Convertible Preferred Stock (“Series A Preferred Stock”) has a par value of $0.0001 per share and is convertible into shares of the Common Stock at a one-to-one winding-up as-if-converted-to-Common-Stock as-converted At-The-Market In November 2020, the Company entered into an at-the-market “at-the-market” Under the 2020 Sales Agreement the Company sold 1,126,733 shares for an aggregate of approximately $137.4 million in gross proceeds, with net proceeds to the Company of approximately $134.8 million after deducting commissions and other transaction costs. Of those shares sold, 1,087,126 were sold in 2021. In June 2021, the Company filed with the U.S. Securities and Exchange Commission (the “SEC”) and had declared S-3 at-the-market As of March 31, 2022, 497,043 shares had been sold under the 2021 Sales Agreement for an aggregate of approximately $40.8 million in gross proceeds, with net proceeds to the Company of approximately $39.8 million after deducting commissions and other transaction costs. All of those shares were sold in 2021. As of March 31, 2022, $159.2 million remained reserved and available for sale under the 2021 Sales Agreement and the Company’s related prospectus supplement.

Stock-based Compensation

Stock-based Compensation	3 Months Ended
	Mar. 31, 2022
Share-based Payment Arrangement [Abstract]
Stock-based Compensation	7. Stock-based Compensation The Company’s 2015 Stock Plan, as amended, is our primary equity incentive compensation plan through which equity based grants are awarded. The 2015 Stock Plan provides for the grant of incentive stock options, non-statutory stock options, restricted stock and other stock-based compensation awards to employees, officers, directors, and consultants of the Company. The administration of the 2015 Stock Plan is under the general supervision of the Compensation Committee of the Board of Directors. The terms of stock options awarded under the 2015 Stock Plan, in general, are determined by the Compensation Committee, provided the exercise price per share generally shall not be set at less than the fair market value of a share of the common stock on the date of grant and the term shall not be greater than shares of its common stock, which includes options outstanding under its prior incentive compensation plan, the 2006 Stock Plan. As of March 31, 2022, shares were available for future issuance under the 2015 Stock Plan. The following table summarizes stock option activity during the three months ended March 31, 2022: Shares Weighted Outstanding at January 1, 2022 2,301,574 $ 78.90 Options granted 613,425 85.80 Options cancelled (36,600 ) 110.09 Outstanding at March 31, 2022 2,878,399 $ 79.96 Exercisable at March 31, 2022 1,525,599 $ 65.64 The total cash received by the Company as a result of stock option exercises was $0 million and $0.5 million, respectively, for the three months ended March 31, 2022 and 2021. The total intrinsic value of options exercised was $0 million and $0.1 million, respectively, Stock-Based Compensation Expense Stock-based compensation expense during the three months ended March 31, 2022 and 2021 was as follows (in thousands): Three Months 2022 2021 Stock-based compensation expense by type of award: Stock options $ 7,477 $ 6,096 Restricted stock — — Total stock-based compensation expense $ 7,477 $ 6,096 Effect of stock-based compensation expense by line item: Research and development $ 3,187 $ 2,637 General and administrative 4,290 3,459 Total stock-based compensation expense included in net loss $ 7,477 $ 6,096 Unrecognized stock-based compensation expense on stock options as of March 31, 2022 was $74.2 million with a weighted average remaining period of 3.16 years.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2022
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	8. Commitments and Contingencies The Company has a Research, Development and Commercialization Agreement with Hoffmann-La The agreement requires future milestone payments to Roche. Remaining milestones under the agreement total $8 million and are payable upon Madrigal achieving specified objectives related to future regulatory approval in the United States and Europe of resmetirom or a product developed from resmetirom. Furthermore, a tiered single-digit royalty is payable on net sales of resmetirom or a product developed from resmetirom, subject to certain reductions. The Company has not achieved any additional product development or regulatory milestones and had no Licensed Product sales for the three months ended March 31, 2022 and 2021. The Company has entered into customary contractual arrangements and letters of intent in preparation for and in support of the Phase 3 clinical trials.

Subsequent Event

Subsequent Event	3 Months Ended
	Mar. 31, 2022
Subsequent Events [Abstract]
Subsequent Event	9. Subsequent Event In May 2022 the Company entered into a $250 million term loan facility with Hercules Capital, Inc. (“Hercules”). Under the terms of the loan agreement, $50 million was drawn at closing. The Company may also draw an additional $125 million in two separate tranches upon achievement of resmetirom clinical and regulatory milestones. An additional $75 million may be drawn by the Company, subject to the approval of Hercules. The loan facility has a floor interest rate of 7.45% and adjusts with future changes in the prime rate, subject to the floor rate. The loan bears initial The loan matures in May 2026 and may be extended an additional year upon the achievement of certain milestones. Additional details of the loan agreement will be filed with the Securities and Exchange Commission on a Current Report on Form 8-K.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2022
Accounting Policies [Abstract]
Principle of Consolidation	Principle of Consolidation The consolidated financial statements include the financial statements of the Company and its wholly owned subsidiaries. All significant intercompany balances have been eliminated in consolidation.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities, and the reported amounts of revenues and expenses during the reporting periods. The Company bases its estimates on historical experience and various other assumptions that management believes to be reasonable under the circumstances. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates.
Cash and Cash Equivalents	Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. The Company maintains its cash in bank accounts, the balance of which, at times, exceeds Federal Deposit Insurance Corporation insured limits. The primary objective of the Company’s investment activities is to preserve its capital for the purpose of funding operations and the Company does not enter into investments for trading or speculative purposes. The Company’s cash is deposited in highly rated financial institutions in the United States. The Company invests in money market funds and high-grade, commercial paper and corporate bonds, which management believes are subject to minimal credit and market risk.
Marketable Securities	Marketable Securities Marketable securities consist of investments in high-grade corporate obligations and government and government agency obligations that are classified as available-for-sale. The Company adjusts the cost of available-for-sale available-for-sale Marketable securities are stated at fair value, including accrued interest, with their unrealized gains and losses included as a component of accumulated other comprehensive income or loss, which is a separate component of stockholders’ equity. The fair value of these securities is based on quoted prices and observable inputs on a recurring basis. Realized gains and losses are determined on the specific identification method. During the three months ended March 31, 2022 and 2021, the Company did not have any realized gains or losses on marketable securities.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The carrying amounts of the Company’s financial instruments, which include cash equivalents and marketable securities, approximate their fair values. The fair value of the Company’s financial instruments reflects the amounts that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy has the following three levels: Level 1—quoted prices in active markets for identical assets and liabilities. 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 that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability. Financial assets and liabilities are classified in their entirety within the fair value hierarchy based on the lowest level of input that is significant to the fair value measurement. The Company measures the fair value of its marketable securities by taking into consideration valuations obtained from third- party pricing sources. The pricing services utilize industry standard valuation models, including both income and market based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker-dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities and other observable inputs. As of March 31, 2022, the Company’s financial assets valued based on Level 1 inputs consisted of cash and cash equivalents in a money market fund, its financial assets valued based on Level 2 inputs consisted of high-grade corporate and government agency bonds and commercial paper, and it had no financial assets valued based on Level 3 inputs. During the three months ended March 31, 2022 and 2021, the Company did not have any transfers of financial assets between Levels 1 and 2. As of March 31, 2022 and December 31, 2021, the Company did not have any financial liabilities that were recorded at fair value on a recurring basis on the balance sheet.
Research and Development Costs	Research and Development Costs Research and development costs are expensed as incurred. Research and development costs are comprised of costs incurred in performing research and development activities, including internal costs (including stock-based compensation), costs for consultants, milestone payments under licensing agreements, and other costs associated with the Company’s preclinical and clinical programs. In particular, the Company has conducted safety studies in animals, optimized and implemented the manufacturing of our drug, and conducted Phase 1-3
Patents	Patents Costs to secure and defend patents are expensed as incurred and are classified as general and administrative expense in the Company’s consolidated statements of operations.
Stock-Based Compensation	Stock-Based Compensation The Company recognizes stock-based compensation expense based on the grant date fair value of stock options granted to employees, officers, and directors. The Company uses the Black-Scholes option pricing model to determine the grant date fair value as management believes it is the most appropriate valuation method for its option grants. The Black-Scholes model requires inputs for risk-free interest rate, dividend yield, volatility and expected lives of the options. The expected lives for options granted represent the period of time that options granted are expected to be outstanding. The Company uses the simplified method for determining the expected lives of options. Expected volatility is based upon an industry estimate or blended rate including the Company’s historical trading activity. The risk-free rate for periods within the expected life of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. The Company estimates the forfeiture rate based on historical data. This analysis is re-evaluated Certain of the employee stock options granted by the Company are structured to qualify as incentive stock options (“ISOs”). Under current tax regulations, the Company does not receive a tax deduction for the issuance, exercise or disposition of ISOs if the employee meets certain holding requirements. If the employee does not meet the holding requirements, a disqualifying disposition occurs, at which time the Company may receive a tax deduction. The Company does not record tax benefits related to ISOs unless and until a disqualifying disposition is reported. In the event of a disqualifying disposition, the entire tax benefit is recorded as a reduction of income tax expense. The Company has not recognized any income tax benefit for its share-based compensation arrangements due to the fact that the Company does not believe it is more likely than not it will realize the related deferred tax assets.
Income Taxes	Income Taxes The Company uses the asset and liability method to account for income taxes. Deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the Company’s financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates expected to be in effect in the years in which the differences are expected to reverse. The Company currently maintains a 100% valuation allowance on its deferred tax assets.
Comprehensive Loss	Comprehensive Loss Comprehensive loss is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner
Basic and Diluted Loss Per Common Share	Basic and Diluted Loss Per Common Share Basic net loss per share is computed using the weighted average number of common shares outstanding during the period, excluding any restricted stock that has been issued but is not yet vested. Diluted net loss per common share is computed using the weighted average number of common shares outstanding and the weighted average dilutive potential common shares outstanding using the treasury stock method. However, for the three months ended March 21, 2022 and 2021, diluted net loss per share is the same as basic net loss per share because the inclusion of weighted average shares of unvested restricted common stock, common stock issuable upon the exercise of stock options, and common stock issuable upon the conversion of preferred stock would be anti-dilutive. The following table summarizes outstanding securities not included in the computation of diluted net loss per common share, as their inclusion would be anti-dilutive: Three Months Ended March 31, 2022 2021 Common stock options 2,878,399 2,193,915 Preferred stock 1,969,797 1,969,797
Recent Accounting Pronouncements	Recent Accounting Pronouncements None

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2022
Accounting Policies [Abstract]
Summary of the outstanding securities not included in the computation of diluted net loss per common share as their inclusion would be anti-dilutive	The following table summarizes outstanding securities not included in the computation of diluted net loss per common share, as their inclusion would be anti-dilutive: Three Months Ended March 31, 2022 2021 Common stock options 2,878,399 2,193,915 Preferred stock 1,969,797 1,969,797

Cash, Cash Equivalents and Ma_2

Cash, Cash Equivalents and Marketable Securities (Tables)	3 Months Ended
	Mar. 31, 2022
Cash and Cash Equivalents [Abstract]
Summary of cash, cash equivalents and available-for-sale marketable securities	A summary of cash, cash equivalents and available-for-sale March 31, 2022 Cost Unrealized Unrealized Fair value Cash and cash equivalents: Cash (Level 1) $ 2,238 $ — $ — $ 2,238 Money market funds (Level 1) 40,044 — — 40,044 Total cash and cash equivalents 42,282 — — 42,282 Marketable securities: Corporate debt securities due within 1 year of date of purchase (Level 2) 170,336 — (366 ) 169,970 U.S. government and government sponsored entities due within 1 year of date of purchase (Level 2) 6,036 — (12 ) 6,024 Corporate debt securities due within 1 to 2 years of date of purchase (Level 2) 1,701 — (24 ) 1,677 Total cash, cash equivalents and marketable securities $ 220,355 $ — $ (402 ) $ 219,953 December 31, 2021 Cost Unrealized Unrealized Fair value Cash and cash equivalents: Cash (Level 1) $ 18,877 $ — $ — $ 18,877 Money market funds (Level 1) 17,392 — — 17,392 Total cash and cash equivalents 36,269 — — 36,269 Marketable securities: Corporate debt securities due within 1 year of date of purchase (Level 2) 228,348 6 (66 ) 228,288 Corporate debt securities due within 1 to 2 years of date of purchase (Level 2) 5,809 — (20 ) 5,789 Total cash, cash equivalents and marketable securities $ 270,426 $ 6 $ (86 ) $ 270,346

Accrued Liabilities (Tables)

Accrued Liabilities (Tables)	3 Months Ended
	Mar. 31, 2022
Accrued Liabilities, Current [Abstract]
Schedule of Accrued Liabilities	Accrued liabilities as of March 31, 2022 and December 31, 2021 consisted of the following (in thousands): March 31, December 31, Contract research organization costs $ 42,168 $ 38,349 Other clinical study related costs 4,103 3,957 Compensation and benefits 2,715 6,769 Professional fees 2,343 2,455 Other 2,113 3,518 Total accrued liabilities $ 53,442 $ 55,048

Stock-based Compensation (Table

Stock-based Compensation (Tables)	3 Months Ended
	Mar. 31, 2022
Share-based Payment Arrangement [Abstract]
Summary of stock option activity	The following table summarizes stock option activity during the three months ended March 31, 2022: Shares Weighted Outstanding at January 1, 2022 2,301,574 $ 78.90 Options granted 613,425 85.80 Options cancelled (36,600 ) 110.09 Outstanding at March 31, 2022 2,878,399 $ 79.96 Exercisable at March 31, 2022 1,525,599 $ 65.64
Schedule of stock-based compensation expense	Stock-based compensation expense during the three months ended March 31, 2022 and 2021 was as follows (in thousands): Three Months 2022 2021 Stock-based compensation expense by type of award: Stock options $ 7,477 $ 6,096 Restricted stock — — Total stock-based compensation expense $ 7,477 $ 6,096 Effect of stock-based compensation expense by line item: Research and development $ 3,187 $ 2,637 General and administrative 4,290 3,459 Total stock-based compensation expense included in net loss $ 7,477 $ 6,096

Summary of Significant Accoun_4

Summary of Significant Accounting Policies - Income Taxes (Details)	3 Months Ended
	Mar. 31, 2022
Income Taxes
Valuation allowance on deferred tax assets (as a percent)	100.00%

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Basic and Diluted Loss Per Common Share (Details) - shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Stock options
Anti-dilutive securities
Outstanding securities not included in the computation of diluted net loss per common share as their inclusion would be anti-dilutive (in shares)	2,878,399	2,193,915
Preferred Stock
Anti-dilutive securities
Outstanding securities not included in the computation of diluted net loss per common share as their inclusion would be anti-dilutive (in shares)	1,969,797	1,969,797

Liquidity and Uncertainties (De

Liquidity and Uncertainties (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Liquidity and Uncertainties
Net loss	$ (57,518)	$ (52,546)
Accumulated deficit	$ (724,828)		$ (667,310)

Cash, Cash Equivalents and Ma_3

Cash, Cash Equivalents and Marketable Securities (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Cash, Cash Equivalents and Marketable Securities
Total cash, cash equivalents and marketable securities, Unrealized gains	$ 0	$ 6
Total cash, cash equivalents and marketable securities, Unrealized losses	(402)	(86)
Carrying value
Cash, Cash Equivalents and Marketable Securities
Cash and cash equivalents	42,282	36,269
Total cash, cash equivalents and marketable securities, Cost	220,355	270,426
Fair value
Cash, Cash Equivalents and Marketable Securities
Cash and cash equivalents	42,282	36,269
Total cash, cash equivalents and marketable securities, Fair value	$ 219,953	$ 270,346
Corporate debt securities due within 1 year of date of purchase
Cash, Cash Equivalents and Marketable Securities
Maturity period from date of purchase to classify an investment as marketable securities	1 year	1 year
Corporate debt securities due within 1 year of date of purchase | Level 2
Cash, Cash Equivalents and Marketable Securities
Marketable securities, unrealized gains	$ 0	$ 6
Marketable securities, unrealized losses	(366)	(66)
Corporate debt securities due within 1 year of date of purchase | Carrying value | Level 2
Cash, Cash Equivalents and Marketable Securities
Marketable securities, cost	170,336	228,348
Corporate debt securities due within 1 year of date of purchase | Fair value | Level 2
Cash, Cash Equivalents and Marketable Securities
Marketable securities, fair value	$ 169,970	$ 228,288
Corporate debt securities due within 1 to 2 years of date of purchase | Maximum [Member]
Cash, Cash Equivalents and Marketable Securities
Maturity period from date of purchase to classify an investment as marketable securities	2 years	2 years
Corporate debt securities due within 1 to 2 years of date of purchase | Minimum [Member]
Cash, Cash Equivalents and Marketable Securities
Maturity period from date of purchase to classify an investment as marketable securities	1 year	1 year
Corporate debt securities due within 1 to 2 years of date of purchase | Level 2
Cash, Cash Equivalents and Marketable Securities
Marketable securities, unrealized gains		$ 0
Marketable securities, unrealized losses	$ (24)	(20)
Corporate debt securities due within 1 to 2 years of date of purchase | Carrying value | Level 2
Cash, Cash Equivalents and Marketable Securities
Marketable securities, cost	1,701	5,809
Corporate debt securities due within 1 to 2 years of date of purchase | Fair value | Level 2
Cash, Cash Equivalents and Marketable Securities
Marketable securities, fair value	$ 1,677	5,789
U.S. government and government sponsored entities due within 1 year of date of purchase
Cash, Cash Equivalents and Marketable Securities
Maturity period from date of purchase to classify an investment as marketable securities	1 year
U.S. government and government sponsored entities due within 1 year of date of purchase | Carrying value | Level 2
Cash, Cash Equivalents and Marketable Securities
Marketable securities, cost	$ 6,036
Marketable securities, unrealized losses	(12)
Marketable securities, fair value	6,024
Cash | Carrying value | Level 1
Cash, Cash Equivalents and Marketable Securities
Cash and cash equivalents	2,238	18,877
Cash | Fair value | Level 1
Cash, Cash Equivalents and Marketable Securities
Cash and cash equivalents	2,238	18,877
Money market funds | Carrying value | Level 1
Cash, Cash Equivalents and Marketable Securities
Cash and cash equivalents	40,044	17,392
Money market funds | Fair value | Level 1
Cash, Cash Equivalents and Marketable Securities
Cash and cash equivalents	$ 40,044	$ 17,392

Accrued Liabilities (Details)

Accrued Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Accrued Liabilities, Current [Abstract]
Contract research organization costs	$ 42,168	$ 38,349
Other clinical study related costs	4,103	3,957
Compensation and benefits	2,715	6,769
Professional fees	2,343	2,455
Other	2,113	3,518
Total accrued liabilities	$ 53,442	$ 55,048

Stockholders' Equity (Deficit)

Stockholders' Equity (Deficit) - Common Stock (Details)	3 Months Ended
	Mar. 31, 2022Vote
Stockholders' Equity Note [Abstract]
Number of votes per share that common stockholders are entitled to receive	1

Stockholders' Equity (Deficit_2

Stockholders' Equity (Deficit) - Preferred Stock (Details) - Series A Convertible Preferred Stock	1 Months Ended
	Jun. 30, 2017Voteshares
Stockholders' Equity (Deficit)
Preferred stock conversion ratio | shares	1
Preferred shares number voting rights | Vote	0

Stockholders' Equity (Deficit_3

Stockholders' Equity (Deficit) - At The Market Issuances (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended
	Nov. 30, 2020	Mar. 31, 2022	Mar. 31, 2021
Stockholders' Equity (Deficit)
Number of shares sold by the entity			1,087,126
At-The-Market Issuance Sales Agreement
Stockholders' Equity (Deficit)
Number of shares sold by the entity		1,126,733
Value of shares sold by the entity		$ 137.4
Net proceeds after deducting commissions and other transactions costs		$ 134.8
At-The-Market Issuance Sales Agreement | 2021 Sales Agreement [Member]
Stockholders' Equity (Deficit)
Number of shares sold by the entity		497,043
Value of shares sold by the entity		$ 40.8
Net proceeds after deducting commissions and other transactions costs		39.8
Remaining reserved amount under shelf registration		159.2
Cowen & Co. LLC | Maximum | At-The-Market Issuance Sales Agreement
Stockholders' Equity (Deficit)
Maximum aggregate offering price	$ 200	$ 200

Stock-based Compensation - Stoc

Stock-based Compensation - Stock Option (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Maximum
Stock-based compensation expense
Expiration period	10 years
Stock options
Stock-based compensation expense
Options outstanding to purchase of common stock	2,878,399
Shares available for future issuance	1,084,468
Shares
Outstanding at the beginning of the year (in shares)	2,301,574
Options granted (in shares)	613,425
Options cancelled (in shares)	(36,600)
Outstanding at the end of the year (in shares)	2,878,399
Exercisable at the end of the year (in shares)	1,525,599
Weighted average exercise price
Outstanding at the beginning of the year (in dollars per share)	$ 78.90
Options granted (in dollars per share)	85.80
Options cancelled (in dollars per share)	110.09
Outstanding at the end of the year (in dollars per share)	79.96
Exercisable at the end of the year (in dollars per share)	$ 65.64
Additional disclosures
Total intrinsic value of options exercised	$ 0	$ 0.1
Proceeds resulting from exercise of stock options	$ 0	$ 0.5
Weighted-average grant date fair value of options (in dollars per share)	$ 59.63	$ 85.17

Stock-based Compensation - Expe

Stock-based Compensation - Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Stock-based compensation expense
Stock-based compensation expense	$ 7,477	$ 6,096
Research and development
Stock-based compensation expense
Stock-based compensation expense	3,187	2,637
General and administrative
Stock-based compensation expense
Stock-based compensation expense	4,290	3,459
Stock options
Stock-based compensation expense
Stock-based compensation expense	7,477	6,096
Unvested restricted common stock
Stock-based compensation expense
Stock-based compensation expense	$ 0	$ 0

Stock-based Compensation - Unre

Stock-based Compensation - Unrecognized Expense (Details) - Stock options $ in Millions	3 Months Ended
	Mar. 31, 2022USD ($)
Unrecognized stock-based compensation expense
Unrecognized stock compensation expense	$ 74.2
Weighted average remaining period (in years)	3 years 1 month 28 days

Commitments and Contingencies (

Commitments and Contingencies (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2019
Commitments and Contingencies
Licensed product sales	$ 0	$ 0
Research, Development and Commercialization Agreement | Hoffmann-La Roche ("Roche")
Commitments and Contingencies
Remainder of future milestone payments			$ 8,000

Subsequent Event (Detail)

Subsequent Event (Detail) - Term Loan [Member] $ in Millions	1 Months Ended
	May 31, 2022USD ($)
Subsequent Event [Line Items]
Debt instrument, Face amount	$ 250
Proceeds from issuance of debt	$ 50
Interest rate	7.95%
Long term debt floor interest rate percentage	7.45%
Debt Instrument Interest Payments Terms	The Company will pay interest-only for a period of 30 months, which may be extended to 60 months upon the achievement of certain milestones
Drawn In Two Separate Tranches Upon AchievementOf Resmetirom Clinical And Regulatory Milestone s [Member]
Subsequent Event [Line Items]
Unused borrowing capacity that can be drawn	$ 125
Drawn To Support Operational Activities [Member]
Subsequent Event [Line Items]
Unused borrowing capacity that can be drawn	$ 75