Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 07, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Savara Inc. | |
Entity Central Index Key | 1,160,308 | |
Trading Symbol | SVRA | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 35,128,771 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 24,946 | $ 22,121 |
Short-term investments | 87,102 | 72,192 |
Prepaid expenses and other current assets | 2,697 | 3,551 |
Total current assets | 114,745 | 97,864 |
Property and equipment, net | 605 | 925 |
In-process R&D | 11,520 | 33,626 |
Goodwill | 26,962 | 27,082 |
Other non-current assets | 1,292 | 131 |
Total assets | 155,124 | 159,628 |
Current liabilities: | ||
Accounts payable | 3,240 | 2,784 |
Accrued expenses | 3,912 | 2,966 |
Debt facility | 3,750 | |
Current portion of capital lease obligation | 318 | 265 |
Total current liabilities | 11,220 | 6,015 |
Long-term liabilities: | ||
Debt facility, net of current portion | 11,357 | 14,775 |
Contingent consideration | 12,079 | 11,948 |
Deferred tax liability | 2,534 | 7,181 |
Capital lease obligation, net of current portion | 297 | |
Other long-term liabilities | 80 | 103 |
Total liabilities | 37,270 | 40,319 |
Stockholders’ equity: | ||
Common stock, $0.001 par value, 200,000,000 and 500,000,000 shares authorized as of September 30, 2018 and December 31, 2017, respectively; 35,120,540 and 30,509,522 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively | 36 | 32 |
Additional paid-in capital | 236,659 | 186,522 |
Accumulated other comprehensive income | 364 | 958 |
Accumulated deficit | (119,205) | (68,203) |
Total stockholders’ equity | 117,854 | 119,309 |
Total liabilities and stockholders' equity | $ 155,124 | $ 159,628 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 200,000,000 | 500,000,000 |
Common stock, shares issued | 35,120,540 | 30,509,522 |
Common stock, shares outstanding | 35,120,540 | 30,509,522 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Operating expenses: | ||||
Research and development | $ 9,509 | $ 4,966 | $ 27,316 | $ 12,076 |
General and administrative | 3,148 | 1,486 | 7,402 | 8,410 |
Impairment of acquired IPR&D | 21,692 | |||
Depreciation | 127 | 91 | 387 | 272 |
Total operating expenses | 12,784 | 6,543 | 56,797 | 20,758 |
Loss from operations | (12,784) | (6,543) | (56,797) | (20,758) |
Other income (expense): | ||||
Interest expense, net | 111 | (277) | (106) | (1,038) |
Foreign currency exchange gain (loss) | (7) | (71) | 87 | (225) |
Loss on extinguishment of debt | (1,816) | |||
Change in fair value of financial instruments | 10 | (43) | (52) | (280) |
Total other income (expense) | 114 | (391) | (71) | (3,359) |
Loss before income taxes | (12,670) | (6,934) | (56,868) | (24,117) |
Income tax benefit | 110 | 117 | 5,866 | 824 |
Net loss | (12,560) | (6,817) | (51,002) | (23,293) |
Accretion of redeemable convertible preferred stock | (578) | |||
Deemed dividend on beneficial conversion feature | (404) | |||
Net loss attributable to common stockholders | (12,560) | (6,817) | (51,002) | (24,275) |
Other comprehensive income: | ||||
Gain (loss) on foreign currency translation | (105) | 348 | (620) | 1,343 |
Unrealized gain (loss) on short-term investments | 13 | (5) | 26 | (5) |
Total Comprehensive Loss | $ (12,652) | $ (6,474) | $ (51,596) | $ (21,955) |
Net loss per share: | ||||
Basic and diluted | $ (0.37) | $ (0.28) | $ (1.61) | $ (1.76) |
Weighted average common shares outstanding | ||||
Basic and diluted | 33,708,563 | 24,209,517 | 31,648,510 | 13,770,032 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - 9 months ended Sep. 30, 2018 - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income [Member] |
Beginning balances at Dec. 31, 2017 | $ 119,309 | $ 32 | $ 186,522 | $ (68,203) | $ 958 |
Beginning balance, shares at Dec. 31, 2017 | 30,509,522 | ||||
Issuance of common stock upon public offering, net | 45,792 | $ 4 | 45,788 | ||
Issuance of common stock upon public offering, net, shares | 4,250,000 | ||||
Issuance of common stock upon At The Market sales, net | 493 | 493 | |||
Issuance of common stock upon At The Market sales, net, shares | 46,900 | ||||
Issuance of common stock for settlement of RSUs, shares | 37,500 | ||||
Net issuance of common stock upon cashless exercise of stock options | 115,754 | ||||
Issuance of common stock upon exercise of stock options | 50 | 50 | |||
Issuance of common stock upon exercise of stock options, shares | 51,162 | ||||
Issuance of common stock upon exercise of warrants | 19 | 19 | |||
Issuance of common stock upon exercise of warrants, Shares | 2,123 | ||||
Common stock issued for purchase of assets | 995 | 995 | |||
Common stock issued for purchase of assets, shares | 107,579 | ||||
Stock-based compensation | 2,792 | 2,792 | |||
Foreign exchange translation adjustment | (620) | (620) | |||
Unrealized gain on short-term investments | 26 | 26 | |||
Net loss incurred | (51,002) | (51,002) | |||
Ending balance at Sep. 30, 2018 | $ 117,854 | $ 36 | $ 236,659 | $ (119,205) | $ 364 |
Ending balance, shares at Sep. 30, 2018 | 35,120,540 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Cash flows from operating activities: | |||||
Net loss | $ (51,002) | $ (23,293) | |||
Adjustments to reconcile net loss to net cash used in operating activities: | |||||
Depreciation | $ 127 | $ 91 | 387 | 272 | |
Impairment of acquired IPR&D | 21,692 | ||||
Changes in fair value of financial instruments | 52 | 280 | |||
Change in fair value of contingent consideration | 131 | 2,108 | |||
Noncash interest | 83 | 395 | |||
Loss on extinguishment of debt | 1,816 | ||||
Acquired IPR&D | 995 | ||||
Foreign currency gain/(loss) | 7 | 71 | (87) | 225 | |
Amortization of debt issuance costs | 332 | 301 | |||
Accretion on discount to short-term investments and convertible promissory notes | (546) | (34) | |||
Stock-based compensation | 2,792 | 350 | |||
Issuance of call option derivative | 344 | ||||
Provision (benefit) for deferred taxes | (4,555) | ||||
Changes in operating assets and liabilities: | |||||
Grant and award receivable | 400 | ||||
Tax refund receivable | (1,393) | (785) | |||
Prepaid expenses and other current assets | 969 | (1,272) | |||
Deferred rent | (23) | (14) | |||
Accounts payable and accrued expenses | 1,391 | 143 | |||
Net cash used in operating activities | (28,782) | (18,764) | |||
Cash flows from investing activities: | |||||
Cash acquired through Merger | 3,442 | ||||
Purchase of property and equipment | (81) | (61) | |||
Purchase of available-for-sale securities | (88,104) | (33,443) | |||
Maturities of available-for-sale securities | 64,346 | ||||
Sale of available-for-sale securities, net | 9,351 | ||||
Net cash used in investing activities | (14,488) | (30,062) | |||
Cash flows from financing activities: | |||||
Proceeds from debt facility | 14,894 | ||||
Proceeds from convertible promissory notes | 3,569 | ||||
Issuance of common stock upon exercise of warrants | 19 | 384 | |||
Issuance of common stock upon public offering, net | 45,792 | 39,522 | |||
Issuance of common stock upon at the market offerings, net | 493 | 991 | |||
Repayment of long-term debt | (3,567) | ||||
Proceeds from exercise of stock options | 50 | ||||
Capital lease obligation principal payments | (257) | (460) | |||
Net cash provided by financing activities | 46,097 | 55,333 | |||
Effect of exchange rate changes on cash and cash equivalents | (2) | (67) | |||
Increase in cash and cash equivalents | 2,825 | 6,440 | |||
Cash and cash equivalents beginning of period | 22,121 | 13,373 | $ 13,373 | ||
Cash and cash equivalents end of period | $ 24,946 | $ 19,813 | 24,946 | 19,813 | $ 22,121 |
Non-cash transactions: | |||||
Extinguishment and derecognition of put options | 2,202 | ||||
Shares issued in connection of business combination and assumed equity awards | 35,846 | ||||
Accretion of redeemable convertible preferred stock | 578 | ||||
Beneficial conversion feature | 404 | ||||
Common stock issued for IPR&D, net | 995 | ||||
Supplemental disclosure of cash flow information: | |||||
Cash paid for interest | $ 1,038 | 359 | |||
Common Stock [Member] | |||||
Non-cash transactions: | |||||
Conversion of convertible notes into common stock | $ 8,249 |
Description of Business and Bas
Description of Business and Basis of Presentation | 9 Months Ended |
Sep. 30, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | 1. Description of Business and Basis of Presentation Description of Business Savara Inc. (“Savara,” the “Company,” or as used in the context of “we” or “us”) is an orphan lung disease company. The Company’s pipeline comprises Molgradex, an inhaled granulocyte-macrophage colony-stimulating factor, or GM-CSF, in Phase 3 development for autoimmune pulmonary alveolar proteinosis (“aPAP”), in Phase 2a development for nontuberculous mycobacterial (“NTM”) lung infection, and in preparation for Phase 2a development in cystic fibrosis (“CF”) affected individuals with chronic NTM lung infection, and AeroVanc, a Phase 3 stage inhaled vancomycin for treatment of persistent methicillin-resistant Staphylococcus aureus (“MRSA”) lung infection in individuals living with CF. The Company and its wholly owned subsidiaries operate in one segment with its principal offices in Austin, Texas. Since inception, Savara has devoted substantially all of its efforts and resources to identifying and developing its product candidates, recruiting personnel, and raising capital. Savara has incurred operating losses and negative cash flow from operations and has no product revenue from inception to date. The Company has not yet commenced commercial operations. Basis of Presentation The interim condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) as defined by the Financial Accounting Standards Board (“FASB”). These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2017. Unaudited Interim Financial Information The interim condensed consolidated financial statements included in this document are unaudited. The unaudited interim financial statements have been prepared on the same basis as the annual financial statements and reflect, in the opinion of management, all adjustments of a normal and recurring nature that are necessary for a fair statement of the Company’s financial position as of September 30, 2018, and its results of operations for the three and nine months ended September 30, 2018 and 2017, and cash flows for the nine months ended September 30, 2018 and 2017. The results of operations for interim periods shown in this report are not necessarily indicative of the results to be expected for the year ending December 31, 2018 or for any other future annual or interim period. The December 31, 2017 consolidated balance sheet was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2017. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Liquidity As of September 30, 2018, the Company had an accumulated deficit of approximately $119.2 million. The Company also had negative cash flow from operations of approximately $28.8 million during the nine months ended September 30, 2018. The cost to further develop and obtain regulatory approval for any drug is substantial and, as noted below, the Company may have to take certain steps to maintain a positive cash position. Accordingly, the Company will need additional capital to further fund the development of, and seek regulatory approvals for, its product candidates and begin to commercialize any approved products. Currently, the Company is primarily focused on the development of respiratory drugs and believes such activities will result in the Company’s continued incurrence of significant research and development and other expenses related to those programs. If the clinical trials for any of the Company’s product candidates fail or produce unsuccessful results and those product candidates do not gain regulatory approval, or if any of the Company’s product candidates, if approved, fail to achieve market acceptance, the Company may never become profitable. Even if the Company achieves profitability in the future, it may not be able to sustain profitability in subsequent periods. The Company intends to cover its future operating expenses through cash and cash equivalents on hand and through a combination of equity offerings, debt financings, government or other third-party funding, and other collaborations and strategic alliances. The Company cannot be sure that additional financing will be available when needed or that, if available, financing will be obtained on terms favorable to the Company or its stockholders. While the Company had cash and cash equivalents of $24.9 million and short-term investments of $87.1 million as of September 30, 2018, the Company intends to continue to raise additional capital as needed through the issuance of additional equity and potentially through borrowings, and strategic alliances with partner companies. However, if such financings are not available timely and at adequate levels, the Company will need to reevaluate its operating plans. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Principles of Consolidation The interim condensed consolidated financial statements of the Company are stated in U.S. dollars and are prepared using U.S. GAAP. These financial statements include the accounts of the Company and its wholly owned subsidiaries. The financial statements of the Company’s wholly owned subsidiaries are recorded in their functional currency and translated into the reporting currency. The cumulative effect of changes in exchange rates between the foreign entity’s functional currency and the reporting currency is reported in Accumulated Other Comprehensive Income. All intercompany transactions and accounts have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires the Company to make certain estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Management’s estimates include those related to the accrual of research and development costs, certain financial instruments recorded at fair value, stock-based compensation, and the valuation allowance for deferred tax assets. The Company bases its estimates on historical experience and on various other market-specific and relevant assumptions that it believes to be reasonable under the circumstances. Accordingly, actual results could be materially different from those estimates. Risks and Uncertainties The product candidates being developed by the Company require approvals from the U.S. Food and Drug Administration (“FDA”) or foreign regulatory agencies prior to commercial sales. There can be no assurance that the Company’s product candidates will receive the necessary approvals. If the Company is denied regulatory approval of its product candidates, or if approval is delayed, it may have a material adverse impact on the Company’s business, results of operations and its financial position. The Company is subject to a number of risks similar to other life science companies, including, but not limited to, risks related to the successful discovery and development of drug candidates, raising additional capital, development of competing drugs and therapies, protection of proprietary technology and market acceptance of the Company’s products. As a result of these and other factors and the related uncertainties, there can be no assurance of the Company’s future success. Cash and Cash Equivalents Cash and cash equivalents consist of cash, institutional bank money market accounts, and commercial paper with original maturities of three months or less when acquired and are stated at cost, which approximates fair value. Short-term Investments The Company has classified its investments in debt securities with readily determinable fair value as available-for-sale securities. These securities are carried at estimated fair value with the aggregate unrealized gains and losses related to these investments reflected as a part of “Accumulated other comprehensive income” within stockholders' equity. The fair value of the investments is based on the specific quoted market price of the securities or comparable securities at the balance sheet dates. Investments in debt securities are considered to be impaired when a decline in fair value is judged to be other than temporary because the Company either intends to sell or it is more-likely-than not that it will have to sell the impaired security before recovery. Once a decline in fair value is determined to be other than temporary, an impairment charge is recorded and a new cost basis in the investment is established. Concentration of Credit Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of cash and cash equivalents and foreign exchange derivatives not designated as hedging. The Company places its cash and cash equivalents with a limited number of high-quality financial institutions and at times may exceed the amount of insurance provided on such deposits. Accrued Research and Development Costs The Company records the costs associated with research, nonclinical studies, clinical trials, and manufacturing development as incurred. These costs are a significant component of the Company’s research and development expenses, with a substantial portion of the Company’s on-going research and development activities conducted by third-party service providers, including contract research and manufacturing organizations. The Company accrues for expenses resulting from obligations under agreements with contract research organizations (“CROs”), contract manufacturing organizations (“CMOs”), and other outside service providers for which payment flows do not match the periods over which materials or services are provided to the Company. Accruals are recorded based on estimates of services received and efforts expended pursuant to agreements established with CROs, CMOs, and other outside service providers. These estimates are typically based on contracted amounts applied to the proportion of work performed and determined through analysis with internal personnel and external service providers as to the progress or stage of completion of the services. The Company makes significant judgments and estimates in determining the accrual balance in each reporting period. In the event advance payments are made to a CRO, CMO, or outside service provider, the payments will be recorded as a prepaid asset which will be amortized or expensed as the contracted services are performed. As actual costs become known, the Company adjusts its prepaids and accruals. Inputs, such as the services performed, the number of patients enrolled, or the study duration, may vary from the Company’s estimates resulting in adjustments to research and development expense in future periods. Changes in these estimates that result in material changes to the Company’s accruals could materially affect the Company’s results of operations. To date, the Company has not experienced any material deviations between accrued and actual research and development expenses. Business Combinations Assets acquired and liabilities assumed as part of a business acquisition are recorded at their estimated fair value at the date of acquisition. The excess of purchase price over the fair value of assets acquired and liabilities assumed is recorded as goodwill. Determining fair value of identifiable assets, particularly intangibles, and liabilities acquired also requires management to make estimates, which are based on all available information and, in some cases, assumptions with respect to the timing and amount of future revenue and expenses associated with an asset. Goodwill, Acquired In-Process Research and Development (IPR&D) and Deferred Tax Liability Goodwill and acquired IPR&D are not amortized but are tested annually for impairment or more frequently if impairment indicators exist. The Company adopted accounting guidance related to annual and interim goodwill and acquired in-process research and development (“IPR&D”) impairment tests which allows the Company to first assess qualitative factors before performing a quantitative assessment of the fair value of a reporting unit. If it is determined on the basis of qualitative factors that the fair value of the reporting unit is more likely than not less than the carrying amount, a quantitative impairment test is required. During the nine months ended September 30, 2018, the Company experienced a $0.1 million and $0.4 million decrease in the carrying value of goodwill and IPR&D, respectively, related to its acquisition of Serendex A/S on July 15, 2016 (as defined and further described in Note 8), which was due to foreign currency translation. In addition, during the nine months ended September 30, 2018, the Company recorded $21.7 million of impairment charges and a corresponding decrease to the carrying value of IPR&D related to the Aironite drug candidate assumed in the Merger (as defined and further described in Note 6) due to the unfavorable results from a Phase 2 study that demonstrated a failure of Aironite to meet the endpoints of the study and limited effectiveness of the compound in patients. As a result of the IPR&D impairment charges recorded in the first quarter of 2018, the Company reduced the associated deferred tax liability related to the acquired IPR&D from the Merger by $4.6 million and recorded a tax benefit. Tax Refund Receivable The Company has recorded a Danish tax credit earned by its subsidiary, Savara ApS, for the nine months ended September 30, 2018. Under Danish tax law, Denmark remits a research and development tax credit equal to 22% of qualified research and development expenditures, not to exceed established thresholds. As of September 30, 2018, credits totaling $1.7 million had been generated but not yet received. Of this Danish tax credit of approximately $1.7 million, $0.8 million is related to research and development activities incurred during the year ended December 31, 2017 and recorded as a receivable in prepaid expenses and other current assets, as receipt is expected to occur in the fourth quarter of 2018. The remaining portion of the Danish tax credit of $0.9 million, which was generated during the nine months ended September 30, 2018, is recorded in other non-current assets and is expected to be received in the fourth quarter of 2019. The Company also recognized a tax benefit for the nine months ended September 30, 2018 as provided by the Australian Taxation Office for qualified research and development expenditures on the NTM program incurred through our subsidiary, Savara Australia Pty. Limited. Under Australian tax law, Australia remits a research and development tax credit equal to 43.5% of qualified research and development expenditures, not to exceed established thresholds. As of September 30, 2018, credits totaling $0.4 million had been generated but not yet received. This Australian tax credit of approximately $0.4 million includes approximately $0.1 million in tax credits generated during the year ended December 31, 2017 and is recorded as a receivable in prepaid expenses and other current assets as receipt is expected to occur in the fourth quarter of 2018. The remaining portion of the Australian tax credit of $0.3 million, which was generated during the nine months ended September 30, 2018, is recorded in other non-current assets and is expected to be received in the fourth quarter of 2019. Segment Reporting 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. Our chief operating decision maker is the chief executive officer. We have one operating segment, specialty pharmaceuticals within the respiratory system. Fair Value of Financial Instruments The accounting standard for fair value measurements provides a framework for measuring fair value and requires disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, based on the Company’s principal or, in absence of a principal, most advantageous market for the specific asset or liability. The Company uses a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement. The hierarchy requires the Company to use observable inputs when available, and to minimize the use of unobservable inputs, when determining fair value. The three tiers are defined as follows: • Level 1 – Observable inputs that reflect quoted market prices (unadjusted) for identical assets or liabilities in active markets; • Level 2 – Observable inputs other than quoted prices in active markets that are observable either directly or indirectly in the marketplace for identical or similar assets and liabilities; and • Level 3 – Unobservable inputs that are supported by little or no market data, which require the Company to develop its own assumptions. Financial instruments carried at fair value include cash and cash equivalents and contingent consideration related to the acquisition of Serendex A/S (see Note 8) for which any change is reflected in general and administrative expense, foreign exchange derivatives, certain warrants previously classified as liabilities, and embedded put options separated from the convertible promissory notes which were converted to equity or derecognized in connection with the Merger. Financial instruments not carried at fair value include accounts payable and accrued liabilities. The carrying amounts of these financial instruments approximate fair value due to the highly liquid nature of these short-term instruments. Net Loss per Share Basic net loss attributable to common stockholders per share is calculated by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock, restricted stock and restricted stock units outstanding during the period without consideration of common stock equivalents. Since the Company was in a loss position for all periods presented, diluted net loss per share is the same as basic net loss per share for all periods presented as the inclusion of all potential dilutive securities would have been antidilutive. Stock-Based Compensation The Company recognizes the cost of stock-based awards granted to employees based on the estimated grant-date fair value of the awards. The value of the portion of the award that is ultimately expected to vest is recognized as expense ratably over the requisite service period. The Company recognizes the compensation costs for awards that vest over several years on a straight-line basis over the vesting period (see Note 12). Forfeitures are recognized when they occur, which may result in the reversal of compensation costs in subsequent periods as the forfeitures arise. The Company recognizes the cost of stock-based awards granted to nonemployees at their then-current fair values as services are performed, and such awards are remeasured through the counterparty performance date. Manufacturing and Other Commitments and Contingencies The Company is subject to various manufacturing royalties and payments related to its product candidate, Molgradex. Under an agreement, as amended, with the Active Pharmaceutical Ingredients (“API”) manufacturer, no signing fee or milestones are included in the royalty payments, and there is no minimum royalty. Upon the successful development, registration and attainment of approval by the proper health authorities, such as the FDA, in any territory except Latin America, Central America and Mexico, the Company must pay a royalty of three percent (3%) on annual net sales to the manufacturer of its API. Additionally, Savara must make certain payments to the API manufacturer upon the achievement of the milestones outlined in the following table. Pursuant to a license agreement between the Company and a Japanese licensee regarding the development and commercialization of Molgradex for the treatment of aPAP in Japan, the Company shall fund the licensee fifty percent (50%), up to a maximum of approximately $0.8 million dollars, of the external costs associated with specific research, regulatory and filing activities to be conducted by the licensee. The Company is also subject to certain contingent milestone payments, disclosed in the following table, payable to the Company’s manufacturer of its nebulizer used to administer Molgradex. In addition to these milestones, the Company will owe a royalty to the manufacturer of its nebulizer based on net sales. The royalty rate ranges from three and a half percent (3.5%) to five percent (5%) depending on the device technology used by the Company to administer the product. Manufacturing and Other Contingent Milestone and Co-Development Payments (in thousands) : September 30, 2018 Molgradex API manufacturer: Delivery of working and master cell banks $ 600 Achievement of certain milestones related to regulatory approval of Molgradex 2,000 Molgradex nebulizer manufacturer: Achievement of various development activities and regulatory approval of nebulizer utilized to administer Molgradex 8,062 Molgradex (aPAP) Japanese licensee: Co-development and regulatory costs 750 Total manufacturing and other commitments $ 11,412 As of September 30, 2018 and December 31, 2017, none of the above milestones or co-developement commitments had been met or incurred. Income Taxes The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. 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 of a change in tax rates on deferred tax assets and liabilities will be recognized in the period that includes the enactment date. A valuation allowance is established against the deferred tax assets to reduce their carrying value to an amount that is more likely than not to be realized. Recent Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers” and has subsequently issued several supplemental and/or clarifying ASUs, which comprise the new comprehensive revenue recognition standard that will replace all current U.S. GAAP guidance on this topic and eliminate all industry-specific guidance. The standard’s core principle is that a reporting entity will recognize revenue when it transfers control of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We have performed an assessment of our contracts with third parties and determined that there would not be a material impact on our financial statements. In February 2016, the FASB issued ASU 2016-02, “Leases”. The update aims at making leasing activities more transparent and comparable and requires substantially all leases be recognized by lessees on their balance sheet as a right-of-use asset and a corresponding lease liability, including leases currently accounted for as operating leases. The update also requires improved disclosures to help users of financial statements better understand the amount, timing and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018 with early adoption permitted. The Company is currently evaluating the impact that the adoption of ASU 2016-02 will have on its consolidated financial statements, but expects the impact to be limited to the operating lease agreements for the office spaces in Austin, Texas, Copenhagen, Denmark, and San Diego, California, currently being subleased. In June 2018, the FASB issued Accounting Standards Update (“ASU”) 2018-07, “Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting.” The update aims at simplifying the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees. The standard is effective for fiscal years beginning after December 15, 2018 with early adoption permitted. The Company does not expect the adoption of ASU 2018-07 to have a material impact on its consolidated financial statements. In August 2018, the FASB issued Accounting Standards Update (“ASU”) 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework- Changes to the Disclosure Requirements for Fair Value Measurement.” The update eliminates, adds, and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. ASU 2018-13 is effective for fiscal years beginning after December 15, 2019 and for interim periods within those fiscal years, with early adoption permitted. The Company’s adoption of ASU 2018-013 did not have a material impact on its consolidated financial statements. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 9 Months Ended |
Sep. 30, 2018 | |
Prepaid Expense And Other Assets Current [Abstract] | |
Prepaid Expenses and Other Current Assets | 3. Prepaid expenses and other current assets Prepaid expenses consisted of (in thousands): September 30, 2018 December 31, 2017 R&D tax credit receivable $ 891 $ 834 Prepaid clinical trial costs 1,067 2,129 VAT receivable 292 196 Prepaid insurance 289 158 Forward currency exchange derivative 4 40 Deposits and other 154 194 Total prepaid expenses and other current assets $ 2,697 $ 3,551 |
Accrued Expenses and Other Liab
Accrued Expenses and Other Liabilities | 9 Months Ended |
Sep. 30, 2018 | |
Payables And Accruals [Abstract] | |
Accrued Expenses and Other Liabilities | 4. Accrued expenses and other liabilities Accrued expenses and other liabilities consisted of (in thousands): September 30, 2018 December 31, 2017 Accrued contracted research and development costs $ 2,946 $ 1,308 Accrued general and administrative costs 578 323 Accrued compensation 388 1,328 Other — 7 Total accrued expenses and other liabilities $ 3,912 $ 2,966 |
Short-term Investments
Short-term Investments | 9 Months Ended |
Sep. 30, 2018 | |
Investments Debt And Equity Securities [Abstract] | |
Short-term Investments | 5. Short-term Investments Short-term Investments in Available for Sale Securities The Company’s investment policy seeks to preserve capital and maintain sufficient liquidity to meet operational and other needs of the business. The following table summarizes, by major security type, the Company’s investments (in thousands): As of September 30, 2018: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Short-term investments U.S. government securities $ 11,992 $ — $ (7 ) $ 11,985 Asset backed securities 9,484 — (4 ) 9,480 Corporate securities 19,090 — (10 ) 19,080 Commercial paper 46,556 1 — 46,557 Total short-term investments $ 87,122 $ 1 $ (21 ) $ 87,102 As of December 31, 2017: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Short-term investments U.S. government securities $ 11,894 $ — $ (9 ) $ 11,885 Asset backed securities 8,389 — (6 ) 8,383 Corporate securities 22,113 — (31 ) 22,082 Commercial paper 29,842 — — 29,842 Total short-term investments $ 72,238 $ — $ (46 ) $ 72,192 The Company has classified its investments as available-for-sale securities. These securities are carried at estimated fair value with the aggregate unrealized gains and losses related to these investments reflected as a part of “Accumulated other comprehensive income” in the Consolidated Balance Sheets. Classification as short-term or long-term is based upon whether the maturity of the debt securities is less than or greater than twelve months. There were no significant realized gains or losses related to investments for the nine months ended September 30, 2018 and September 30, 2017. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | 6. Acquisitions Mast On April 27, 2017, Savara completed its business combination with Mast Therapeutics, Inc. ("Mast"), a publicly held company, in accordance with the terms of the Agreement and Plan of Merger and dated January 6, 2017 (the "Merger"). The Merger was accounted for as a reverse merger under the acquisition method of accounting whereby Savara was considered to have acquired Mast for financial reporting purposes because, immediately upon completion of the Merger, Savara stockholders held a majority of the voting interest of the combined company. Pursuant to business combination accounting, the Company applied the acquisition method, which requires the assets acquired and liabilities assumed be recorded at fair value with limited exceptions. The Company used the Multi-Period Excess Earnings Model (“MPEEM”), a form of the income approach to value the in-process research and development intangible asset. Under the valuation method, the present value of future cash flows expected to be generated from the IPR&D of the acquired product candidate, Aironite, was determined using a reasonable discount rate, and identified projected cash flows from Aironite were risk adjusted to take into consideration the probabilities of moving through the various clinical stages. The excess of the purchase price over the assets acquired and liabilities assumed represents goodwill. The goodwill is primarily attributable to the synergies expected to arise after the acquisition and is not expected to be deductible for tax purposes. All transaction costs associated with the Merger were incurred during the year ended December 31, 2017. The total purchase price for Mast was $35.8 million based on the fair value of the outstanding Mast equity on the date of the Merger which was allocated as follows: Purchase Consideration (in thousands) Fair value of Mast shares outstanding $ 33,117 Fair value of Mast equity 2,729 Fair value of total consideration $ 35,846 Assets acquired and liabilities assumed Cash and cash equivalents $ 3,442 Tangible assets 283 In-process research and development intangible assets 21,692 Liabilities (2,396 ) Debt (3,407 ) Deferred tax liability (7,375 ) Total assets acquired and liabilities assumed 12,239 Goodwill 23,607 Total $ 35,846 As discussed in Note 2, during the first quarter of 2018, the Company recorded a $21.7 million impairment charge and corresponding decrease to the carrying value of IPR&D recorded with respect to the Merger to write the IPR&D asset off in full due to the failure of Aironite to meet its primary and secondary endpoints in the Phase 2 study. Following the negative outcome of the study, Savara does not plan to support any new development of Aironite. The decrease in the carrying value of IPR&D has been recognized as an expense to “Impairment of acquired IPR&D” included in the condensed consolidated statement of operations for the nine months ended September 30, 2018. As a result of the impairment charge recorded in the first quarter of 2018, the Company reduced the related deferred tax liability by $4.6 million and recorded a tax benefit. Cardeas In June 2018, the Company entered into an asset purchase agreement (the “Asset Purchase Agreement”) with Cardeas Pharma Corporation (“Cardeas”), a biopharmaceutical company specializing in the development of inhaled antibiotics to treat hospital-acquired and/or multi-drug resistant bacterial respiratory infections from highly antibiotic-resistant organisms. Pursuant to the Asset Purchase Agreement, Savara acquired substantially all of the assets, including intellectual property, of Cardeas for a purchase price comprised of (i) an upfront payment of 107,579 shares of the Company’s common stock equal to approximately $1.0 million as of the date of consummation and (ii) certain contingent payments due upon the achievement of distinct development milestones. The Company has accounted for the transaction as an asset purchase. As of the measurement date of the acquisition and at September 30, 2018, the Company has deemed that the contingent payments are not probable and as such has not recorded an associated liability but will continue to assess at each period accordingly . |
Debt Facility
Debt Facility | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt Facility | 7. Debt Facility On April 28, 2017, the Company entered into a loan and security agreement with Silicon Valley Bank (the “Loan Agreement”). During the year ended December 31, 2017, upon satisfaction of the conditions of the Loan Agreement, the Company executed two tranches totaling $15.0 million, the maximum credit available pursuant to the debt facility. The capital was utilized for the repayment of $3.7 million of principal debt and fees of Mast assumed in the Merger. The residual capital is being utilized to fund ongoing development programs of the Company and for general corporate purposes. The Loan Agreement contains customary affirmative and negative covenants, including among others, covenants limiting our ability and that of our subsidiaries to dispose of assets, permit a change in control, merge or consolidate, make acquisitions, incur indebtedness, grant liens, make investments, make certain restricted payments and enter into transactions with affiliates, in each case subject to certain exceptions. The Loan Agreement bears interest at the prime rate reported in The Wall Street Journal, plus a spread of 4.25%. Interest only payments are due through September 2018 followed by monthly payments of principal plus interest over the following 30 months. Since the second tranche was fully extended, the interest only period was extended for an additional 6 months, through March 2019 followed by monthly payments of principal plus interest over the following 24 months through the maturity date of March 1, 2021 under the Loan Agreement provisions. We were obligated to pay customary closing fees and are obligated to pay a final payment of 6.0% of the aggregate principal amount of term loans advanced under the facility. The end of term charge of $0.9 million will be due on the scheduled maturity date and is being recognized as an increase to the principal with a corresponding charge to interest expense over the term of the facility using the effective interest method. In connection with the Loan Agreement, we paid $0.1 million in legal costs directly attributable to issuing the debt instrument. Such charges were accounted for as debt issuance costs and are being amortized to interest expense using the effective interest method through the scheduled maturity date. Upon funding the first tranche of the Loan Agreement, the Company was obligated to issue warrants to purchase shares of the Company’s common stock equal to 3.0% of the funded amount divided by the exercise price to be set based on the average price per share over the preceding 10 trading days prior to funding or the price per share prior to the day of funding. The number of shares callable under the warrant agreement for the first tranche and exercise price were 24,725 shares of the Company’s common stock at an exercise price of $9.10 per share, with a ten year life, expiring April 28, 2027 (“April 2017 Warrants”). Upon funding the second tranche of the Loan Agreement, the Company was obligated to issue warrants to purchase shares of the Company’s common stock equal to 3.0% of the funded amount divided by an exercise price to be set based on the average price per share over the preceding 10 trading days prior to funding or the price per share prior to the day of funding. As such, the Company issued additional warrants for 41,736 shares at an exercise price of $5.39 with a ten year life, expiring June 15, 2027 (“June 2017 Warrants”). The April 2017 Warrants and June 2017 Warrants were valued using the Black-Scholes option pricing model with the following assumptions: volatility of 71.42% and 71.57%, respectively, expected term of ten years, risk-free interest rate of 2.33% and 2.16%, respectively, and a zero dividend yield. The collective warrant fair value of $0.4 million has been recorded as a debt discount and is being amortized through interest expense using the effective interest method through the scheduled maturity date. Summary of Carrying Value The following table summarizes the components of the debt facility carrying value, which approximates the fair value (in thousands): As of September 30, 2018 Short-term Long-term Principal payments to lender and end of term charge $ 3,750 $ 11,601 Debt Issuance costs — (54 ) Debt discount related to warrants — (190 ) Carrying Value $ 3,750 $ 11,357 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 8. Fair Value Measurements The Company measures and reports certain financial instruments at fair value on a recurring basis and evaluates its financial instruments subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them in each reporting period. The Company determined that certain investments in debt securities classified as available-for-sale securities were Level 1 financial instruments. Additional investments in corporate debt securities and commercial paper are considered Level 2 financial instruments because the Company has access to quoted prices but does not have visibility to the volume and frequency of trading for all of these investments. For the Company’s investments, a market approach is used for recurring fair value measurements and the valuation techniques use inputs that are observable, or can be corroborated by observable data, in an active marketplace. Foreign exchange derivatives not designated as hedging instruments are considered Level 2 financial instruments. The Company’s foreign exchange derivative instruments are typically short-term in nature. The Company also determined that the contingent consideration, described further below, was a Level 3 financial instrument. The fair value of these instruments as of September 30, 2018 and December 31, 2017 was as follows (in thousands): Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) As of September 30, 2018: Cash equivalents: U.S. Treasury money market funds $ 15,496 $ — $ — Commercial paper $ — $ 5,817 $ — Short-term investments: U.S. government securities $ 11,985 $ — $ — Asset backed securities $ 9,480 Corporate securities $ — $ 19,080 $ — Commercial paper $ — $ 46,557 $ — Other assets: Foreign exchange derivatives not designated as hedging instruments $ — $ 4 $ — Liabilities: Contingent consideration $ — $ — $ 12,079 As of December 31, 2017: Cash equivalents: U.S. Treasury money market funds $ 4,540 $ — $ — Commercial paper $ — $ 1,029 $ — Repurchase agreements $ — $ 2,500 $ — Short-term investments: U.S. government securities $ 11,885 $ — $ — Asset backed securities $ 8,383 Corporate securities $ — $ 22,082 $ — Commercial paper $ — $ 29,842 $ — Other assets: Foreign exchange derivatives not designated as hedging instruments $ — $ 40 $ — Liabilities: Contingent consideration $ — $ — $ 11,948 Pursuant to the acquisition of certain assets, liabilities, and subsidiaries of Serendex A/S through its wholly-owned Danish subsidiary, Savara ApS, on July 15, 2016, Savara agreed to pay the seller, in addition to a stipulated amount of shares of Savara’s common stock, (i) $5.0 million upon receipt of marketing approval of Molgradex by the European Medicines Agency, (ii) $15.0 million upon receipt of marketing approval of Molgradex by the FDA, and (iii) $1.5 million upon receipt of marketing approval of Molgradex by the Japanese Pharmaceuticals and Medical Devices Agency (the “Contingent Milestone Payments”). The Company estimates the likelihood of approval in each region, separately, based on the product candidate’s current phase of development and utilizing published studies of clinical development success rates for comparable non-oncology orphan drugs. The present value of the potential cash outflows from the probability weighted Contingent Milestone Payments is then estimated by taking into consideration that the Contingent Milestone Payments are similar to a business expense of the Company and would be senior to any Company debt obligations. The resulting weighted average present value factor is then applied to discount the probability adjusted Contingent Milestone Payments for each region to derive the fair value of the Contingent Milestone Payments. The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial instruments (in thousands) for the nine months ended September 30, 2018 and year ended December 31, 2017: Warrant Liability Put options on convertible promissory notes Contingent Consideration As of December 31, 2016 $ 303 $ 979 $ 9,708 Change in fair value 67 169 2,240 Put option at issuance of convertible promissory notes — 828 — Conversion of convertible promissory notes (1,976 ) Reclassification of warrant liability to common equity upon Merger (370 ) — — Balance at December 31, 2017 $ — $ — $ 11,948 Change in fair value — — 131 Balance at September 30, 2018 $ — $ — $ 12,079 The Company records changes in fair value of the contingent consideration in general and administrative expense. In June 2017, the Company determined that there would be a change to the Molgradex program due to the FDA’s guidance on the clinical program requirements for a New Drug Application submission in the U.S. related to the Molgradex product, which was issued in May 2017. Based on the FDA's guidance, the Company modified certain criteria of its Molgradex development program which the Company believes will accelerate the development timeline in the U.S. The Company accordingly accounted for this change in its valuation of the contingent consideration as of June 30, 2017. Additionally, in the first quarter of 2018, Savara received approval from the FDA of its expansion of the Molgradex Phase 3 Study for aPAP into the U.S. to support its expedited U.S. development strategy for Molgradex. However, in order to achieve sufficient support for the study endpoints and outcome, the sample size of the study was increased, resulting in the extension of the patient enrollment completion dates, and hence, the approval dates of Molgradex, by approximately two calendar quarters. The Company likewise accounted for this change in its valuation of the contingent consideration in the requisite calendar quarters. The Company also accounted for the time value of money related to the Contingent Milestone Payments from December 31, 2017 to September 30, 2018 in its assessment. Accordingly, the related contingent consideration liability was remeasured to $12.1 million as of September 30, 2018. The Company did not transfer any assets measured at fair value on a recurring basis to or from Level 1, Level 2 and Level 3 during the nine months ended September 30, 2018 and year ended December 31, 2017. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2018 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | 9. Derivative Financial Instruments In the normal course of business, the Company is exposed to the impact of foreign currency fluctuations. The Company seeks to limit these risks by following risk management policies and procedures, including the use of derivatives. The Company’s derivative contracts, which are not designated as hedging instruments, principally address short-term foreign currency exchange. The estimated fair value of the derivative contracts was based upon the relative exchange rate as of the balance sheet date. Accordingly, any gains or losses resulting from variances between this exchange rate and the exchange rate at the contract inception date were recognized as other income or expense in the Condensed Consolidated Statements of Operations and Comprehensive Loss. As of September 30, 2018, there was an asset of approximately $3.1 million consisting of unsettled forward exchange contracts to purchase foreign currency, a corresponding liability of approximately $3.1 million consisting of forward exchange contract obligations, resulting in net derivative financial instruments, recorded at their estimated fair value, of approximately four thousand dollars in prepaid expenses and other current assets. |
Shareholders_ Equity
Shareholders’ Equity | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Shareholders’ Equity | 10. Shareholders’ Equity Public Offering On July 30, 2018, the Company completed an underwritten public offering consisting of 4,250,000 shares of its common stock at a price to the public of $11.50 per share. The net proceeds from the offering, after deducting the underwriting discounts and commissions and offering expenses, were approximately $45.8 million. The Company intends to use the net proceeds from the offering for working capital and general corporate purposes, which include, but are not limited to, the funding of clinical development of and pursuing regulatory approval for its product candidates (including the expansion of the Molgradex NTM program with a new study in the U.S. in CF affected individuals with chronic NTM lung infection), the initiation of Molgradex pre-commercialization activities, and general and administrative expenses. The July 2018 public offering was executed under a new registration agreement filed with the Securities and Exchange Commission on June 29, 2018 and declared effective on July 13, 2018. Common Stock Sales Agreement/At The Market (ATM) On April 28, 2017, the Company entered into a Common Stock Sales Agreement (the “Sales Agreement”) with H.C. Wainwright & Co., LLC (“Wainwright”), as sales agent, which was amended by Amendment No. 1 to the Common Stock Agreement (the “Amendment”) on June 29, 2018, pursuant to which the Company may offer and sell, from time to time, through Wainwright, shares of Savara’s common stock, par value $0.001 per share (the “Shares”), having an aggregate offering price of not more than $60.0 million, in addition to the $2.3 million in shares sold prior to the Amendment. The Amendment was effective on July 13, 2018, at the time the Company’s Registration Statement on Form S-3, dated June 29, 2018, (the “New Registration Statement”) was declared effective by the Securities and Exchange Commission. The Shares will be offered and sold pursuant to the New Registration Statement. Subject to the terms and conditions of the Sales Agreement, Wainwright will use its commercially reasonable efforts to sell the Shares from time to time, based upon the Company’s instructions. The Company has provided Wainwright with customary indemnification rights, and Wainwright will be entitled to a commission at a fixed commission rate equal to 3.0% of the gross proceeds per Share sold. Sales of the Shares, if any, under the Sales Agreement may be made in transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act of 1933, as amended. The Company has no obligation to sell any of the Shares and may at any time suspend sales under the Sales Agreement or terminate the Sales Agreement. During the nine months ended September 30, 2018, the Company sold 46,900 shares of common stock under the Sales Agreement, for net proceeds of approximately $0.5 million. Common Stock The Company’s amended and restated certificate of incorporation, as amended in June 2018, authorizes the Company to issue 201 million shares of common and preferred stock, consisting of 200 million shares of common stock with $0.001 par value and one million shares of preferred stock with $0.001 par value. The following is a summary of the Company’s common stock at September 30, 2018 and December 31, 2017. September 30, 2018 December 31, 2017 Common stock authorized 200,000,000 500,000,000 Common stock outstanding 35,120,540 30,509,522 The Company’s shares of common stock reserved for issuance as of September 30, 2018 and December 31, 2017 were as follows: September 30, 2018 December 31, 2017 Warrants from Mast acquired in Merger 750,840 1,152,231 Warrants Converted Pursuant to Merger 72,869 74,992 April 2017 SVB Warrants 24,725 24,725 June 2017 SVB Warrants 41,736 41,736 Prefunded warrants 775,000 775,000 Stock options outstanding 2,634,295 1,916,832 Issued and unvested RSU's 169,375 86,875 Total shares reserved 4,468,840 4,072,391 Warrants The following table summarizes the outstanding warrants for the Company’s common stock as of September 30, 2018: Shares Underlying Outstanding Warrants Exercise Price Expiration Date 314,446 $ 52.50 November 2019 32,467 $ 7.00 August 2020 403,927 $ 29.40 February 2021 72,869 $ 8.98 June 2021 24,725 $ 9.10 April 2027 41,736 $ 5.39 June 2027 775,000 $ 0.01 October 2024 1,665,170 |
Commitments
Commitments | 9 Months Ended |
Sep. 30, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments | 11. Commitments Operating Leases We are obligated under operating leases for office space. We lease office space in Copenhagen, Denmark, with monthly rent of approximately six thousand dollars, expiring on September 30, 2022. On November 29, 2017, we entered into a sublease agreement for a new office space in Austin, Texas for our corporate headquarters. The term of the sublease space commenced on January 1, 2018 and will continue until July 31, 2021, and we agreed to make monthly rental payments of thirteen thousand dollars, subject to increases of approximately 2% annually on the anniversary of the commencement date of the sublease term. However, monthly base rent for calendar month one of the sublease term was abated. We previously leased office space for our corporate headquarters, prior to our relocation on January 1, 2018, in Austin, Texas pursuant to an operating lease dated November 19, 2012, as amended May 22, 2015, under which we are obligated to remit monthly rental payments of approximately five thousand dollars for the period January 1, 2018 through January 31, 2019 and five thousand six hundred dollars thereafter through November 30, 2019. On November 29, 2017, we entered into a sublease agreement pursuant to which the sublessee will occupy the office space and remit these rental payments to Savara, as obligor, effective January 1, 2018 except for the first month’s rent on January 2018. Risk Management The Company maintains various forms of insurance that the Company's management believes are adequate to reduce the exposure to certain risks associated with operating the Company’s business to an acceptable level. Employment Agreements Certain executive officers are entitled to payments if they are terminated without cause or as a result of a change in control. Upon termination without cause, and not as a result of death or disability, each of such officers is entitled to receive a payment of base salary for twelve months and pro-rated portion of their unpaid bonus following termination of employment and such officer will be entitled to continue to receive coverage under medical and dental benefit plans for twelve months or until such officer is covered under a separate plan from another employer. Upon a termination other than for cause or for good reason within twelve months following a change in control, each of such officers is entitled to receive a payment of base salary for eighteen months and one-hundred percent of their unpaid bonus following termination of employment and such officer will be entitled to continue to receive coverage under medical and dental benefit plans for twelve months or until such officer is covered under a separate plan from another employer and will also be entitled to certain acceleration of such officer's outstanding unvested options at the time of such termination. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | 12. Stock-Based Compensation A. Equity Incentive Plan 2008 Stock Option Plan The Company adopted the Savara Inc. Stock Option Plan (the “2008 Plan”), pursuant to which the Company had reserved shares for issuance to employees, directors, and consultants. The 2008 Plan includes 1) the option grant program providing for both incentive and non-qualified stock options, as defined by the Internal Revenue Code, and 2) the stock issuance program providing for the issuance of awards that are valued based upon common stock, including restricted stock, dividend equivalents, stock appreciation rights, phantom stock, and performance units. The 2008 Plan also allows eligible persons to purchase shares of common stock at an amount determined by the plan administrator. Upon a participant’s termination, the Company retains the right to repurchase unvested shares issued in conjunction with the stock issuance program at the fair market value per share as of the date of termination. Prior to the closing of the Merger, the Company had issued incentive and non-qualified options and restricted stock to employees and non-employees under the 2008 Plan. The terms of the stock options, including the exercise price per share and vesting provisions, were determined by the board of directors. Stock options were granted at exercise prices not less than the estimated fair market value of the Company’s common stock at the date of grant based upon objective and subjective factors including: third-party valuations, preferred stock transactions with third parties, current operating and financial performance, management estimates and future expectations. Stock option grants typically vest quarterly over three to four years and expire ten years from the grant date, and restricted stock grants vest on a quarterly basis over four years and expire ten years from the grant date. Following the Merger, the Company no longer issues stock-based awards under the 2008 Plan. 2015 Omnibus Incentive Option Plan The Company operates the 2015 Omnibus Incentive Plan (the “2015 Plan”), which was amended in June 2018. The 2015 Plan provides for the grant of incentive and non-statutory stock options, as well as share appreciation rights, restricted shares, restricted stock units (“RSUs”), performance units, shares and other share-based awards. Share-based awards are subject to terms and conditions established by our board of directors or the compensation committee of our board of directors. As of September 30, 2018, the number of shares of our common stock available for grant under the 2015 Plan was 2,042,218 shares. B. Stock Option Valuation Under the 2008 Plan and 2015 Plan, the Company values stock options using the Black-Scholes option-pricing model, which requires the input of subjective assumptions, including the risk-free interest rate, expected life, expected stock price volatility and dividend yield. The risk-free interest rate assumption is based upon observed interest rates for constant maturity U.S. Treasury securities consistent with the expected term of the Company’s employee stock options. The expected life represents the period of time the stock options are expected to be outstanding and is based on the simplified method. The Company uses the simplified method due to the lack of sufficient historical exercise data to provide a reasonable basis upon which to otherwise estimate the expected life of the stock options. Expected volatility is based on historical volatilities for publicly traded stock of comparable companies over the estimated expected life of the stock options. The Company assumes no dividend yield because dividends are not expected to be paid in the near future, which is consistent with the Company’s history of not paying dividends. The valuation of stock options is also impacted by the valuation of common stock. Refer to the section above for further information on the valuation methodology utilized by the Company to determine the value of its common stock. C. Stock-Based Award Activity The following table provides a summary of stock-based awards for the 2008 Plan and 2015 Plan (the “Plans”) for the nine months ended September 30, 2018 and 2017: Nine months ended September 30, 2018 Nine months ended September 30, 2017 Stock Options RSUs Total Stock Options RSUs Total Outstanding as of December 31 1,916,832 86,875 2,003,707 2,129,856 — 2,129,856 Granted 1,016,720 120,000 1,136,720 42,500 122,588 165,088 Exercised (175,407 ) (37,500 ) (212,907 ) (118,213 ) (72,361 ) (190,574 ) Forfeited (123,850 ) — (123,850 ) (447,065 ) (227 ) (447,292 ) Outstanding as of September 30 2,634,295 169,375 2,803,670 1,607,078 50,000 1,657,078 D. Stock-Based Compensation Stock-based compensation expense is included in the following line items in the accompanying statements of operations and comprehensive loss for the three and nine months ended September 30, 2018 and 2017 (in thousands): Three Months Ended Nine Months Ended September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Research and development $ 813 $ 38 $ 1,186 $ 112 General and administrative 1,175 76 1,606 238 Total stock-based compensation $ 1,988 $ 114 $ 2,792 $ 350 |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 13. Net Loss per Share Basic and diluted net loss per share is computed by dividing net loss by the weighted-average number of common stock outstanding during the period. For periods in which the Company generated a net loss, the Company does not include the potential impact of dilutive securities in diluted net loss per share, as the impact of these items is anti-dilutive. The following weighted-average equity instruments were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented: Nine Months Ended September 30, 2018 September 30, 2017 Awards under equity incentive plan 2,634,295 1,607,078 Unvested restricted shares and restricted stock units 173,422 78,396 Derivative call option — 650,000 Warrants to purchase common stock 1,665,170 1,293,684 Total 4,472,887 3,629,158 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The interim condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) as defined by the Financial Accounting Standards Board (“FASB”). These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2017. |
Unaudited Interim Financial Information | Unaudited Interim Financial Information The interim condensed consolidated financial statements included in this document are unaudited. The unaudited interim financial statements have been prepared on the same basis as the annual financial statements and reflect, in the opinion of management, all adjustments of a normal and recurring nature that are necessary for a fair statement of the Company’s financial position as of September 30, 2018, and its results of operations for the three and nine months ended September 30, 2018 and 2017, and cash flows for the nine months ended September 30, 2018 and 2017. The results of operations for interim periods shown in this report are not necessarily indicative of the results to be expected for the year ending December 31, 2018 or for any other future annual or interim period. The December 31, 2017 consolidated balance sheet was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2017. |
Liquidity | Liquidity As of September 30, 2018, the Company had an accumulated deficit of approximately $119.2 million. The Company also had negative cash flow from operations of approximately $28.8 million during the nine months ended September 30, 2018. The cost to further develop and obtain regulatory approval for any drug is substantial and, as noted below, the Company may have to take certain steps to maintain a positive cash position. Accordingly, the Company will need additional capital to further fund the development of, and seek regulatory approvals for, its product candidates and begin to commercialize any approved products. Currently, the Company is primarily focused on the development of respiratory drugs and believes such activities will result in the Company’s continued incurrence of significant research and development and other expenses related to those programs. If the clinical trials for any of the Company’s product candidates fail or produce unsuccessful results and those product candidates do not gain regulatory approval, or if any of the Company’s product candidates, if approved, fail to achieve market acceptance, the Company may never become profitable. Even if the Company achieves profitability in the future, it may not be able to sustain profitability in subsequent periods. The Company intends to cover its future operating expenses through cash and cash equivalents on hand and through a combination of equity offerings, debt financings, government or other third-party funding, and other collaborations and strategic alliances. The Company cannot be sure that additional financing will be available when needed or that, if available, financing will be obtained on terms favorable to the Company or its stockholders. While the Company had cash and cash equivalents of $24.9 million and short-term investments of $87.1 million as of September 30, 2018, the Company intends to continue to raise additional capital as needed through the issuance of additional equity and potentially through borrowings, and strategic alliances with partner companies. However, if such financings are not available timely and at adequate levels, the Company will need to reevaluate its operating plans. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
Principles of Consolidation | Principles of Consolidation The interim condensed consolidated financial statements of the Company are stated in U.S. dollars and are prepared using U.S. GAAP. These financial statements include the accounts of the Company and its wholly owned subsidiaries. The financial statements of the Company’s wholly owned subsidiaries are recorded in their functional currency and translated into the reporting currency. The cumulative effect of changes in exchange rates between the foreign entity’s functional currency and the reporting currency is reported in Accumulated Other Comprehensive Income. All intercompany transactions and accounts have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires the Company to make certain estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Management’s estimates include those related to the accrual of research and development costs, certain financial instruments recorded at fair value, stock-based compensation, and the valuation allowance for deferred tax assets. The Company bases its estimates on historical experience and on various other market-specific and relevant assumptions that it believes to be reasonable under the circumstances. Accordingly, actual results could be materially different from those estimates. |
Risks and Uncertainties | Risks and Uncertainties The product candidates being developed by the Company require approvals from the U.S. Food and Drug Administration (“FDA”) or foreign regulatory agencies prior to commercial sales. There can be no assurance that the Company’s product candidates will receive the necessary approvals. If the Company is denied regulatory approval of its product candidates, or if approval is delayed, it may have a material adverse impact on the Company’s business, results of operations and its financial position. The Company is subject to a number of risks similar to other life science companies, including, but not limited to, risks related to the successful discovery and development of drug candidates, raising additional capital, development of competing drugs and therapies, protection of proprietary technology and market acceptance of the Company’s products. As a result of these and other factors and the related uncertainties, there can be no assurance of the Company’s future success. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of cash, institutional bank money market accounts, and commercial paper with original maturities of three months or less when acquired and are stated at cost, which approximates fair value. |
Short-term Investments | Short-term Investments The Company has classified its investments in debt securities with readily determinable fair value as available-for-sale securities. These securities are carried at estimated fair value with the aggregate unrealized gains and losses related to these investments reflected as a part of “Accumulated other comprehensive income” within stockholders' equity. The fair value of the investments is based on the specific quoted market price of the securities or comparable securities at the balance sheet dates. Investments in debt securities are considered to be impaired when a decline in fair value is judged to be other than temporary because the Company either intends to sell or it is more-likely-than not that it will have to sell the impaired security before recovery. Once a decline in fair value is determined to be other than temporary, an impairment charge is recorded and a new cost basis in the investment is established. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of cash and cash equivalents and foreign exchange derivatives not designated as hedging. The Company places its cash and cash equivalents with a limited number of high-quality financial institutions and at times may exceed the amount of insurance provided on such deposits. |
Accrued Research and Development Costs | Accrued Research and Development Costs The Company records the costs associated with research, nonclinical studies, clinical trials, and manufacturing development as incurred. These costs are a significant component of the Company’s research and development expenses, with a substantial portion of the Company’s on-going research and development activities conducted by third-party service providers, including contract research and manufacturing organizations. The Company accrues for expenses resulting from obligations under agreements with contract research organizations (“CROs”), contract manufacturing organizations (“CMOs”), and other outside service providers for which payment flows do not match the periods over which materials or services are provided to the Company. Accruals are recorded based on estimates of services received and efforts expended pursuant to agreements established with CROs, CMOs, and other outside service providers. These estimates are typically based on contracted amounts applied to the proportion of work performed and determined through analysis with internal personnel and external service providers as to the progress or stage of completion of the services. The Company makes significant judgments and estimates in determining the accrual balance in each reporting period. In the event advance payments are made to a CRO, CMO, or outside service provider, the payments will be recorded as a prepaid asset which will be amortized or expensed as the contracted services are performed. As actual costs become known, the Company adjusts its prepaids and accruals. Inputs, such as the services performed, the number of patients enrolled, or the study duration, may vary from the Company’s estimates resulting in adjustments to research and development expense in future periods. Changes in these estimates that result in material changes to the Company’s accruals could materially affect the Company’s results of operations. To date, the Company has not experienced any material deviations between accrued and actual research and development expenses. |
Business Combinations | Business Combinations Assets acquired and liabilities assumed as part of a business acquisition are recorded at their estimated fair value at the date of acquisition. The excess of purchase price over the fair value of assets acquired and liabilities assumed is recorded as goodwill. Determining fair value of identifiable assets, particularly intangibles, and liabilities acquired also requires management to make estimates, which are based on all available information and, in some cases, assumptions with respect to the timing and amount of future revenue and expenses associated with an asset. |
Goodwill, Acquired In-Process Research and Development (IPR&D) and Deferred Tax Liability | Goodwill, Acquired In-Process Research and Development (IPR&D) and Deferred Tax Liability Goodwill and acquired IPR&D are not amortized but are tested annually for impairment or more frequently if impairment indicators exist. The Company adopted accounting guidance related to annual and interim goodwill and acquired in-process research and development (“IPR&D”) impairment tests which allows the Company to first assess qualitative factors before performing a quantitative assessment of the fair value of a reporting unit. If it is determined on the basis of qualitative factors that the fair value of the reporting unit is more likely than not less than the carrying amount, a quantitative impairment test is required. During the nine months ended September 30, 2018, the Company experienced a $0.1 million and $0.4 million decrease in the carrying value of goodwill and IPR&D, respectively, related to its acquisition of Serendex A/S on July 15, 2016 (as defined and further described in Note 8), which was due to foreign currency translation. In addition, during the nine months ended September 30, 2018, the Company recorded $21.7 million of impairment charges and a corresponding decrease to the carrying value of IPR&D related to the Aironite drug candidate assumed in the Merger (as defined and further described in Note 6) due to the unfavorable results from a Phase 2 study that demonstrated a failure of Aironite to meet the endpoints of the study and limited effectiveness of the compound in patients. As a result of the IPR&D impairment charges recorded in the first quarter of 2018, the Company reduced the associated deferred tax liability related to the acquired IPR&D from the Merger by $4.6 million and recorded a tax benefit. |
Tax Refund Receivable | Tax Refund Receivable The Company has recorded a Danish tax credit earned by its subsidiary, Savara ApS, for the nine months ended September 30, 2018. Under Danish tax law, Denmark remits a research and development tax credit equal to 22% of qualified research and development expenditures, not to exceed established thresholds. As of September 30, 2018, credits totaling $1.7 million had been generated but not yet received. Of this Danish tax credit of approximately $1.7 million, $0.8 million is related to research and development activities incurred during the year ended December 31, 2017 and recorded as a receivable in prepaid expenses and other current assets, as receipt is expected to occur in the fourth quarter of 2018. The remaining portion of the Danish tax credit of $0.9 million, which was generated during the nine months ended September 30, 2018, is recorded in other non-current assets and is expected to be received in the fourth quarter of 2019. The Company also recognized a tax benefit for the nine months ended September 30, 2018 as provided by the Australian Taxation Office for qualified research and development expenditures on the NTM program incurred through our subsidiary, Savara Australia Pty. Limited. Under Australian tax law, Australia remits a research and development tax credit equal to 43.5% of qualified research and development expenditures, not to exceed established thresholds. As of September 30, 2018, credits totaling $0.4 million had been generated but not yet received. This Australian tax credit of approximately $0.4 million includes approximately $0.1 million in tax credits generated during the year ended December 31, 2017 and is recorded as a receivable in prepaid expenses and other current assets as receipt is expected to occur in the fourth quarter of 2018. The remaining portion of the Australian tax credit of $0.3 million, which was generated during the nine months ended September 30, 2018, is recorded in other non-current assets and is expected to be received in the fourth quarter of 2019. |
Segment Reporting | Segment Reporting 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. Our chief operating decision maker is the chief executive officer. We have one operating segment, specialty pharmaceuticals within the respiratory system. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The accounting standard for fair value measurements provides a framework for measuring fair value and requires disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, based on the Company’s principal or, in absence of a principal, most advantageous market for the specific asset or liability. The Company uses a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement. The hierarchy requires the Company to use observable inputs when available, and to minimize the use of unobservable inputs, when determining fair value. The three tiers are defined as follows: • Level 1 – Observable inputs that reflect quoted market prices (unadjusted) for identical assets or liabilities in active markets; • Level 2 – Observable inputs other than quoted prices in active markets that are observable either directly or indirectly in the marketplace for identical or similar assets and liabilities; and • Level 3 – Unobservable inputs that are supported by little or no market data, which require the Company to develop its own assumptions. Financial instruments carried at fair value include cash and cash equivalents and contingent consideration related to the acquisition of Serendex A/S (see Note 8) for which any change is reflected in general and administrative expense, foreign exchange derivatives, certain warrants previously classified as liabilities, and embedded put options separated from the convertible promissory notes which were converted to equity or derecognized in connection with the Merger. Financial instruments not carried at fair value include accounts payable and accrued liabilities. The carrying amounts of these financial instruments approximate fair value due to the highly liquid nature of these short-term instruments. |
Net Loss per Share | Net Loss per Share Basic net loss attributable to common stockholders per share is calculated by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock, restricted stock and restricted stock units outstanding during the period without consideration of common stock equivalents. Since the Company was in a loss position for all periods presented, diluted net loss per share is the same as basic net loss per share for all periods presented as the inclusion of all potential dilutive securities would have been antidilutive. |
Stock-Based Compensation | Stock-Based Compensation The Company recognizes the cost of stock-based awards granted to employees based on the estimated grant-date fair value of the awards. The value of the portion of the award that is ultimately expected to vest is recognized as expense ratably over the requisite service period. The Company recognizes the compensation costs for awards that vest over several years on a straight-line basis over the vesting period (see Note 12). Forfeitures are recognized when they occur, which may result in the reversal of compensation costs in subsequent periods as the forfeitures arise. The Company recognizes the cost of stock-based awards granted to nonemployees at their then-current fair values as services are performed, and such awards are remeasured through the counterparty performance date. |
Manufacturing and Other Commitments and Contingencies | Manufacturing and Other Commitments and Contingencies The Company is subject to various manufacturing royalties and payments related to its product candidate, Molgradex. Under an agreement, as amended, with the Active Pharmaceutical Ingredients (“API”) manufacturer, no signing fee or milestones are included in the royalty payments, and there is no minimum royalty. Upon the successful development, registration and attainment of approval by the proper health authorities, such as the FDA, in any territory except Latin America, Central America and Mexico, the Company must pay a royalty of three percent (3%) on annual net sales to the manufacturer of its API. Additionally, Savara must make certain payments to the API manufacturer upon the achievement of the milestones outlined in the following table. Pursuant to a license agreement between the Company and a Japanese licensee regarding the development and commercialization of Molgradex for the treatment of aPAP in Japan, the Company shall fund the licensee fifty percent (50%), up to a maximum of approximately $0.8 million dollars, of the external costs associated with specific research, regulatory and filing activities to be conducted by the licensee. The Company is also subject to certain contingent milestone payments, disclosed in the following table, payable to the Company’s manufacturer of its nebulizer used to administer Molgradex. In addition to these milestones, the Company will owe a royalty to the manufacturer of its nebulizer based on net sales. The royalty rate ranges from three and a half percent (3.5%) to five percent (5%) depending on the device technology used by the Company to administer the product. Manufacturing and Other Contingent Milestone and Co-Development Payments (in thousands) : September 30, 2018 Molgradex API manufacturer: Delivery of working and master cell banks $ 600 Achievement of certain milestones related to regulatory approval of Molgradex 2,000 Molgradex nebulizer manufacturer: Achievement of various development activities and regulatory approval of nebulizer utilized to administer Molgradex 8,062 Molgradex (aPAP) Japanese licensee: Co-development and regulatory costs 750 Total manufacturing and other commitments $ 11,412 As of September 30, 2018 and December 31, 2017, none of the above milestones or co-developement commitments had been met or incurred. |
Income Taxes | Income Taxes The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. 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 of a change in tax rates on deferred tax assets and liabilities will be recognized in the period that includes the enactment date. A valuation allowance is established against the deferred tax assets to reduce their carrying value to an amount that is more likely than not to be realized. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers” and has subsequently issued several supplemental and/or clarifying ASUs, which comprise the new comprehensive revenue recognition standard that will replace all current U.S. GAAP guidance on this topic and eliminate all industry-specific guidance. The standard’s core principle is that a reporting entity will recognize revenue when it transfers control of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We have performed an assessment of our contracts with third parties and determined that there would not be a material impact on our financial statements. In February 2016, the FASB issued ASU 2016-02, “Leases”. The update aims at making leasing activities more transparent and comparable and requires substantially all leases be recognized by lessees on their balance sheet as a right-of-use asset and a corresponding lease liability, including leases currently accounted for as operating leases. The update also requires improved disclosures to help users of financial statements better understand the amount, timing and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018 with early adoption permitted. The Company is currently evaluating the impact that the adoption of ASU 2016-02 will have on its consolidated financial statements, but expects the impact to be limited to the operating lease agreements for the office spaces in Austin, Texas, Copenhagen, Denmark, and San Diego, California, currently being subleased. In June 2018, the FASB issued Accounting Standards Update (“ASU”) 2018-07, “Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting.” The update aims at simplifying the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees. The standard is effective for fiscal years beginning after December 15, 2018 with early adoption permitted. The Company does not expect the adoption of ASU 2018-07 to have a material impact on its consolidated financial statements. In August 2018, the FASB issued Accounting Standards Update (“ASU”) 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework- Changes to the Disclosure Requirements for Fair Value Measurement.” The update eliminates, adds, and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. ASU 2018-13 is effective for fiscal years beginning after December 15, 2019 and for interim periods within those fiscal years, with early adoption permitted. The Company’s adoption of ASU 2018-013 did not have a material impact on its consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Manufacturing and Other Contingent Milestone and Co-Development Payments | The Company is also subject to certain contingent milestone payments, disclosed in the following table, payable to the Company’s manufacturer of its nebulizer used to administer Molgradex. In addition to these milestones, the Company will owe a royalty to the manufacturer of its nebulizer based on net sales. The royalty rate ranges from three and a half percent (3.5%) to five percent (5%) depending on the device technology used by the Company to administer the product. Manufacturing and Other Contingent Milestone and Co-Development Payments (in thousands) : September 30, 2018 Molgradex API manufacturer: Delivery of working and master cell banks $ 600 Achievement of certain milestones related to regulatory approval of Molgradex 2,000 Molgradex nebulizer manufacturer: Achievement of various development activities and regulatory approval of nebulizer utilized to administer Molgradex 8,062 Molgradex (aPAP) Japanese licensee: Co-development and regulatory costs 750 Total manufacturing and other commitments $ 11,412 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Prepaid Expense And Other Assets Current [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses consisted of (in thousands): September 30, 2018 December 31, 2017 R&D tax credit receivable $ 891 $ 834 Prepaid clinical trial costs 1,067 2,129 VAT receivable 292 196 Prepaid insurance 289 158 Forward currency exchange derivative 4 40 Deposits and other 154 194 Total prepaid expenses and other current assets $ 2,697 $ 3,551 |
Accrued Expenses and Other Li_2
Accrued Expenses and Other Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Payables And Accruals [Abstract] | |
Summary of Accrued Expenses and Other Liabilities | Accrued expenses and other liabilities consisted of (in thousands): September 30, 2018 December 31, 2017 Accrued contracted research and development costs $ 2,946 $ 1,308 Accrued general and administrative costs 578 323 Accrued compensation 388 1,328 Other — 7 Total accrued expenses and other liabilities $ 3,912 $ 2,966 |
Short-term Investments (Tables)
Short-term Investments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Investments Debt And Equity Securities [Abstract] | |
Summary of Major Security Type of Investments | The following table summarizes, by major security type, the Company’s investments (in thousands): As of September 30, 2018: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Short-term investments U.S. government securities $ 11,992 $ — $ (7 ) $ 11,985 Asset backed securities 9,484 — (4 ) 9,480 Corporate securities 19,090 — (10 ) 19,080 Commercial paper 46,556 1 — 46,557 Total short-term investments $ 87,122 $ 1 $ (21 ) $ 87,102 As of December 31, 2017: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Short-term investments U.S. government securities $ 11,894 $ — $ (9 ) $ 11,885 Asset backed securities 8,389 — (6 ) 8,383 Corporate securities 22,113 — (31 ) 22,082 Commercial paper 29,842 — — 29,842 Total short-term investments $ 72,238 $ — $ (46 ) $ 72,192 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Summary of Purchase Price Allocation | The total purchase price for Mast was $35.8 million based on the fair value of the outstanding Mast equity on the date of the Merger which was allocated as follows: Purchase Consideration (in thousands) Fair value of Mast shares outstanding $ 33,117 Fair value of Mast equity 2,729 Fair value of total consideration $ 35,846 Assets acquired and liabilities assumed Cash and cash equivalents $ 3,442 Tangible assets 283 In-process research and development intangible assets 21,692 Liabilities (2,396 ) Debt (3,407 ) Deferred tax liability (7,375 ) Total assets acquired and liabilities assumed 12,239 Goodwill 23,607 Total $ 35,846 |
Debt Facility (Tables)
Debt Facility (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Summary of Components of Debt Facility Carrying Value | The following table summarizes the components of the debt facility carrying value, which approximates the fair value (in thousands): As of September 30, 2018 Short-term Long-term Principal payments to lender and end of term charge $ 3,750 $ 11,601 Debt Issuance costs — (54 ) Debt discount related to warrants — (190 ) Carrying Value $ 3,750 $ 11,357 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Summary of Fair Value of Financial Instruments | The fair value of these instruments as of September 30, 2018 and December 31, 2017 was as follows (in thousands): Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) As of September 30, 2018: Cash equivalents: U.S. Treasury money market funds $ 15,496 $ — $ — Commercial paper $ — $ 5,817 $ — Short-term investments: U.S. government securities $ 11,985 $ — $ — Asset backed securities $ 9,480 Corporate securities $ — $ 19,080 $ — Commercial paper $ — $ 46,557 $ — Other assets: Foreign exchange derivatives not designated as hedging instruments $ — $ 4 $ — Liabilities: Contingent consideration $ — $ — $ 12,079 As of December 31, 2017: Cash equivalents: U.S. Treasury money market funds $ 4,540 $ — $ — Commercial paper $ — $ 1,029 $ — Repurchase agreements $ — $ 2,500 $ — Short-term investments: U.S. government securities $ 11,885 $ — $ — Asset backed securities $ 8,383 Corporate securities $ — $ 22,082 $ — Commercial paper $ — $ 29,842 $ — Other assets: Foreign exchange derivatives not designated as hedging instruments $ — $ 40 $ — Liabilities: Contingent consideration $ — $ — $ 11,948 |
Summary of Changes in Fair Value of Company's Level 3 Financial Instruments | The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial instruments (in thousands) for the nine months ended September 30, 2018 and year ended December 31, 2017: Warrant Liability Put options on convertible promissory notes Contingent Consideration As of December 31, 2016 $ 303 $ 979 $ 9,708 Change in fair value 67 169 2,240 Put option at issuance of convertible promissory notes — 828 — Conversion of convertible promissory notes (1,976 ) Reclassification of warrant liability to common equity upon Merger (370 ) — — Balance at December 31, 2017 $ — $ — $ 11,948 Change in fair value — — 131 Balance at September 30, 2018 $ — $ — $ 12,079 |
Shareholders_ Equity (Tables)
Shareholders’ Equity (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Summary of Company’s Common Stock | The following is a summary of the Company’s common stock at September 30, 2018 and December 31, 2017. September 30, 2018 December 31, 2017 Common stock authorized 200,000,000 500,000,000 Common stock outstanding 35,120,540 30,509,522 |
Company’s Shares of Common Stock Reserved for Issuance | The Company’s shares of common stock reserved for issuance as of September 30, 2018 and December 31, 2017 were as follows: September 30, 2018 December 31, 2017 Warrants from Mast acquired in Merger 750,840 1,152,231 Warrants Converted Pursuant to Merger 72,869 74,992 April 2017 SVB Warrants 24,725 24,725 June 2017 SVB Warrants 41,736 41,736 Prefunded warrants 775,000 775,000 Stock options outstanding 2,634,295 1,916,832 Issued and unvested RSU's 169,375 86,875 Total shares reserved 4,468,840 4,072,391 |
Summary of Outstanding Warrants for Company’s Common Stock | The following table summarizes the outstanding warrants for the Company’s common stock as of September 30, 2018: Shares Underlying Outstanding Warrants Exercise Price Expiration Date 314,446 $ 52.50 November 2019 32,467 $ 7.00 August 2020 403,927 $ 29.40 February 2021 72,869 $ 8.98 June 2021 24,725 $ 9.10 April 2027 41,736 $ 5.39 June 2027 775,000 $ 0.01 October 2024 1,665,170 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Stock-based Awards for 2008 Plan and 2015 Plan | The following table provides a summary of stock-based awards for the 2008 Plan and 2015 Plan (the “Plans”) for the nine months ended September 30, 2018 and 2017: Nine months ended September 30, 2018 Nine months ended September 30, 2017 Stock Options RSUs Total Stock Options RSUs Total Outstanding as of December 31 1,916,832 86,875 2,003,707 2,129,856 — 2,129,856 Granted 1,016,720 120,000 1,136,720 42,500 122,588 165,088 Exercised (175,407 ) (37,500 ) (212,907 ) (118,213 ) (72,361 ) (190,574 ) Forfeited (123,850 ) — (123,850 ) (447,065 ) (227 ) (447,292 ) Outstanding as of September 30 2,634,295 169,375 2,803,670 1,607,078 50,000 1,657,078 |
Stock-based Compensation Expense included in Accompanying Statements of Operations and Comprehensive Loss | Stock-based compensation expense is included in the following line items in the accompanying statements of operations and comprehensive loss for the three and nine months ended September 30, 2018 and 2017 (in thousands): Three Months Ended Nine Months Ended September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Research and development $ 813 $ 38 $ 1,186 $ 112 General and administrative 1,175 76 1,606 238 Total stock-based compensation $ 1,988 $ 114 $ 2,792 $ 350 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Anti-dilutive Weighted-Average Equity Instruments Excluded from Calculation of Diluted Net Loss Per Share | The following weighted-average equity instruments were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented: Nine Months Ended September 30, 2018 September 30, 2017 Awards under equity incentive plan 2,634,295 1,607,078 Unvested restricted shares and restricted stock units 173,422 78,396 Derivative call option — 650,000 Warrants to purchase common stock 1,665,170 1,293,684 Total 4,472,887 3,629,158 |
Description of Business and B_2
Description of Business and Basis of Presentation - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2018USD ($)Segment | |
Description Of Business And Basis Of Presentation [Line Items] | |
Number of operating segments | Segment | 1 |
Product [Member] | |
Description Of Business And Basis Of Presentation [Line Items] | |
Product revenue from inception to date | $ | $ 0 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Detail) | Apr. 27, 2017 | Mar. 31, 2018USD ($) | Sep. 30, 2018USD ($)Segment | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) |
Summary Of Significant Accounting Policies [Line Items] | |||||
Accumulated deficit | $ (119,205,000) | $ (68,203,000) | |||
Cash flow from operations | (28,782,000) | $ (18,764,000) | |||
Cash and cash equivalents | 24,946,000 | 22,121,000 | |||
Short-term investments | $ 87,102,000 | 72,192,000 | |||
Cash and cash equivalents with original maturities | three months or less | ||||
Impairment charges and corresponding decrease to carrying value | $ 21,692,000 | ||||
Number of operating segments | Segment | 1 | ||||
Contingent milestones or co-development commitments met or incurred | $ 0 | 0 | |||
Active Pharmaceutical Ingredients [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Minimum royalty payment | 0 | ||||
Amount of signing fee or milestones included in royalty payments | $ 0 | ||||
Agreement description | Under an agreement, as amended, with the Active Pharmaceutical Ingredients (“API”) manufacturer, no signing fee or milestones are included in the royalty payments, and there is no minimum royalty. | ||||
Royalty percent on net sale | 3.00% | ||||
aPAP [Member] | Japan [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Percentage of other contingent milestone payments associated with specific research, regulatory and filing activities | 50.00% | ||||
Other contingent milestone payments associated with specific research, regulatory and filing activities | $ 750,000 | ||||
aPAP [Member] | Japan [Member] | Maximum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Other contingent milestone payments associated with specific research, regulatory and filing activities | $ 800,000 | ||||
Nebulizer | Maximum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Royalty percent on net sale | 5.00% | ||||
Nebulizer | Minimum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Royalty percent on net sale | 3.50% | ||||
Savara ApS [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Research and development tax credits | 22.00% | ||||
Research and development tax credits receivable | $ 1,700,000 | ||||
Savara ApS [Member] | Prepaid Expenses and Other Current Assets [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Research and development tax credits receivable | 800,000 | ||||
Savara ApS [Member] | Other Non-Current Assets [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Research and development tax credits receivable | $ 900,000 | ||||
Savara Australia Pty Limited [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Research and development tax credits | 43.50% | ||||
Research and development tax credits receivable | $ 400,000 | ||||
Savara Australia Pty Limited [Member] | Prepaid Expenses and Other Current Assets [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Research and development tax credits receivable | $ 100,000 | ||||
Savara Australia Pty Limited [Member] | Other Non-Current Assets [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Research and development tax credits receivable | $ 300,000 | ||||
Serendex A/S [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Business combination completion date | Jul. 15, 2016 | ||||
Carrying value of goodwill | $ 100,000 | ||||
Carrying value of IPR&D | 400,000 | ||||
Mast [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Business combination completion date | Apr. 27, 2017 | ||||
Tax benefit related to reduction in deferred tax liability | $ 4,600,000 | ||||
IPR&D [Member] | Mast [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Impairment charges and corresponding decrease to carrying value | 21,700,000 | $ 21,700,000 | |||
Tax benefit related to reduction in deferred tax liability | $ 4,600,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Manufacturing and Other Contingent Milestone and Co-Development Payments (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |
Total manufacturing and other commitments | $ 11,412 |
Molgradex API Manufacturer [Member] | |
Summary Of Significant Accounting Policies [Line Items] | |
Delivery of working and master cell banks | 600 |
Achievement of certain milestones related to regulatory approval of Molgradex | 2,000 |
Molgradex Nebulizer Manufacturer [Member] | |
Summary Of Significant Accounting Policies [Line Items] | |
Achievement of various development activities and regulatory approval of nebulizer utilized to administer Molgradex | 8,062 |
Molgradex (aPAP) Japanese Licensee [Member] | Japan [Member] | |
Summary Of Significant Accounting Policies [Line Items] | |
Co-development and regulatory costs | $ 750 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets - Summary of Prepaid Expenses and Other Current Assets (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Prepaid Expense And Other Assets Current [Abstract] | ||
R&D tax credit receivable | $ 891 | $ 834 |
Prepaid clinical trial costs | 1,067 | 2,129 |
VAT receivable | 292 | 196 |
Prepaid insurance | 289 | 158 |
Forward currency exchange derivative | 4 | 40 |
Deposits and other | 154 | 194 |
Total prepaid expenses and other current assets | $ 2,697 | $ 3,551 |
Accrued Expenses and Other Li_3
Accrued Expenses and Other Liabilities - Summary of Accrued Expenses and Other Liabilities (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Payables And Accruals [Abstract] | ||
Accrued contracted research and development costs | $ 2,946 | $ 1,308 |
Accrued general and administrative costs | 578 | 323 |
Accrued compensation | 388 | 1,328 |
Other | 7 | |
Total accrued expenses and other liabilities | $ 3,912 | $ 2,966 |
Short-term Investments - Summar
Short-term Investments - Summary of Major Security and Type of Investments (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | $ 87,122 | $ 72,238 |
Gross Unrealized Gains | 1 | |
Gross Unrealized Losses | (21) | (46) |
Fair Value | 87,102 | 72,192 |
U.S. Government Securities [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 11,992 | 11,894 |
Gross Unrealized Losses | (7) | (9) |
Fair Value | 11,985 | 11,885 |
Asset Backed Securities [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 9,484 | 8,389 |
Gross Unrealized Losses | (4) | (6) |
Fair Value | 9,480 | 8,383 |
Corporate Securities [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 19,090 | 22,113 |
Gross Unrealized Losses | (10) | (31) |
Fair Value | 19,080 | 22,082 |
Commercial Paper [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 46,556 | 29,842 |
Gross Unrealized Gains | 1 | |
Fair Value | $ 46,557 | $ 29,842 |
Short-term Investments - Additi
Short-term Investments - Additional Information (Detail) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Investments Debt And Equity Securities [Abstract] | ||
Realized gains or losses on investments | $ 0 | $ 0 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) - USD ($) $ in Thousands | Apr. 27, 2017 | Jan. 06, 2017 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2018 |
Business Acquisition [Line Items] | |||||
Purchase price based on the fair value of outstanding equity | $ 35,846 | ||||
Impairment charges and corresponding decrease to carrying value | $ 21,692 | ||||
Mast [Member] | |||||
Business Acquisition [Line Items] | |||||
Business combination completion date | Apr. 27, 2017 | ||||
Merger agreement, effective date | Jan. 6, 2017 | ||||
Purchase price based on the fair value of outstanding equity | $ 35,800 | ||||
Tax benefit related to reduction in deferred tax liability | $ 4,600 | ||||
Mast [Member] | IPR&D [Member] | |||||
Business Acquisition [Line Items] | |||||
Impairment charges and corresponding decrease to carrying value | 21,700 | $ 21,700 | |||
Tax benefit related to reduction in deferred tax liability | $ 4,600 | ||||
Cardeas [Member] | |||||
Business Acquisition [Line Items] | |||||
Common stock upfront payment, shares | 107,579 | ||||
Common stock upfront payment, value | $ 1,000 |
Acquisitions - Summary of Purch
Acquisitions - Summary of Purchase Price Allocation - (Detail) - USD ($) $ in Thousands | Apr. 27, 2017 | Sep. 30, 2018 | Dec. 31, 2017 |
Business Combinations [Abstract] | |||
Fair value of Mast shares outstanding | $ 33,117 | ||
Fair value of Mast equity | 2,729 | ||
Fair value of total consideration | 35,846 | ||
Assets acquired and liabilities assumed | |||
Cash and cash equivalents | 3,442 | ||
Tangible assets | 283 | ||
In-process research and development intangible assets | 21,692 | ||
Liabilities | (2,396) | ||
Debt | (3,407) | ||
Deferred tax liability | (7,375) | ||
Total assets acquired and liabilities assumed | 12,239 | ||
Goodwill | 23,607 | $ 26,962 | $ 27,082 |
Total | $ 35,846 |
Debt Facility - Additional Info
Debt Facility - Additional Information (Detail) $ / shares in Units, $ in Thousands | Apr. 28, 2017USD ($)$ / sharesshares | Sep. 30, 2018USD ($)shares | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($)Tranche |
Line Of Credit Facility [Line Items] | ||||
Number of tranches | Tranche | 2 | |||
Repayment of principal debt and fees | $ 3,567 | |||
Final payment due on date of maturity | $ 900 | |||
Warrants issued to purchase shares of common stock | shares | 1,665,170 | |||
Amortization of debt discount | $ 400 | |||
April 2017 Warrants [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Warrants, expected term | 10 years | |||
April 2017 Warrants [Member] | Volatility [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Warrants, expected rate | 71.42 | |||
April 2017 Warrants [Member] | Risk Free Interest Rate [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Warrants, expected rate | 2.33 | |||
April 2017 Warrants [Member] | Dividend Yield [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Warrants, expected rate | 0 | |||
June 2017 Warrants [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Warrants, expected term | 10 years | |||
June 2017 Warrants [Member] | Volatility [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Warrants, expected rate | 71.57 | |||
June 2017 Warrants [Member] | Risk Free Interest Rate [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Warrants, expected rate | 2.16 | |||
June 2017 Warrants [Member] | Dividend Yield [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Warrants, expected rate | 0 | |||
Common Stock [Member] | April 2017 Warrants [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Common stock warrants issued to purchase common stock percentage on funded amount | 3.00% | |||
Warrants issued to purchase shares of common stock | shares | 24,725 | |||
Exercise price of warrants per share | $ / shares | $ 9.10 | |||
Warrants expiration term | 10 years | |||
Warrants expiration date | Apr. 28, 2027 | |||
Common Stock [Member] | June 2017 Warrants [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Common stock warrants issued to purchase common stock percentage on funded amount | 3.00% | |||
Exercise price of warrants per share | $ / shares | $ 5.39 | |||
Warrants expiration term | 10 years | |||
Warrants expiration date | Jun. 15, 2027 | |||
Additional warrants issued to purchase shares of common stock | shares | 41,736 | |||
Loan and Security Agreement [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Repayment of principal debt and fees | $ 3,700 | |||
Loan and Security Agreement [Member] | Silicon Valley Bank [Member] | Term Loan [Member] | ||||
Line Of Credit Facility [Line Items] | ||||
Loan and security agreement, maximum amount | $ 15,000 | |||
Interest rate, basis spread | 4.25% | |||
Loan agreement payment terms | The Loan Agreement bears interest at the prime rate reported in The Wall Street Journal, plus a spread of 4.25%. Interest only payments are due through September 2018 followed by monthly payments of principal plus interest over the following 30 months. Since the second tranche was fully extended, the interest only period was extended for an additional 6 months, through March 2019 followed by monthly payments of principal plus interest over the following 24 months through the maturity date of March 1, 2021 under the Loan Agreement provisions. | |||
Debt instrument interest only payment maturity date | 2018-09 | |||
Debt instrument principal and interest payment period | 30 months | |||
Debt instrument extended interest only payment maturity date | 2019-03 | |||
Debt instrument interest only payment extended period | 6 months | |||
Debt instrument principal and interest payment extended period | 24 months | |||
Debt instrument, frequency of periodic interest payments | monthly | |||
Debt instrument maturity date | Mar. 1, 2021 | |||
Customary closing fees | 6.00% | |||
Payments of debt issuance costs | $ 100 |
Debt Facility - Summary of Comp
Debt Facility - Summary of Components of Debt Facility Carrying Value (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Disclosure [Abstract] | ||
Principal payments to lender and end of term charge, Short-term | $ 3,750 | |
Carrying value, Short-term | 3,750 | |
Principal payments to lender and end of term charge, Long-term | 11,601 | |
Debt issuance costs, Long-term | (54) | |
Debt discount related to warrants, Long-term | (190) | |
Carrying value, Long-term | $ 11,357 | $ 14,775 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Fair Value of Financial Instruments (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Short-term investments: | ||
Short-term investments | $ 87,102 | $ 72,192 |
U.S. Government Securities [Member] | ||
Short-term investments: | ||
Short-term investments | 11,985 | 11,885 |
Asset Backed Securities [Member] | ||
Short-term investments: | ||
Short-term investments | 9,480 | 8,383 |
Corporate Securities [Member] | ||
Short-term investments: | ||
Short-term investments | 19,080 | 22,082 |
Commercial Paper [Member] | ||
Short-term investments: | ||
Short-term investments | 46,557 | 29,842 |
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | U.S, Treasury Money Market Funds [Member] | ||
Cash equivalents: | ||
Cash equivalents | 15,496 | 4,540 |
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | U.S. Government Securities [Member] | ||
Short-term investments: | ||
Short-term investments | 11,985 | 11,885 |
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Other assets: | ||
Foreign exchange derivatives not designated as hedging instruments | 4 | 40 |
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Asset Backed Securities [Member] | ||
Short-term investments: | ||
Short-term investments | 9,480 | 8,383 |
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Corporate Securities [Member] | ||
Short-term investments: | ||
Short-term investments | 19,080 | 22,082 |
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Commercial Paper [Member] | ||
Cash equivalents: | ||
Cash equivalents | 5,817 | 1,029 |
Short-term investments: | ||
Short-term investments | 46,557 | 29,842 |
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Repurchase Agreements [Member] | ||
Cash equivalents: | ||
Cash equivalents | 2,500 | |
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Liabilities: | ||
Contingent consideration | $ 12,079 | $ 11,948 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Fair value, assets, level 1 to level 2 transfers, amount | $ 0 | $ 0 | |
Fair value, assets, level 2 to level 1 transfers, amount | 0 | 0 | |
Fair value, assets, transfers into level 3, amount | 0 | 0 | |
Fair value, assets, transfers out of level 3, amount | 0 | 0 | |
Contingent Consideration [Member] | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Contingent consideration liability | $ 12,079,000 | $ 11,948,000 | $ 9,708,000 |
Serendex A/S [Member] | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Business combination completion date | Jul. 15, 2016 | ||
European Medicines Agency Approval [Member] | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Contingent milestone payments | $ 5,000,000 | ||
FDA Approval [Member] | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Contingent milestone payments | 15,000,000 | ||
Japanese Pharmaceuticals and Medical Devices Agency Approval [Member] | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Contingent milestone payments | $ 1,500,000 |
Fair Value Measurements - Sum_2
Fair Value Measurements - Summary of Changes in Fair Value of Company's Level 3 Financial Instruments (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Warrant Liability [Member] | ||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Beginning balance | $ 303 | |
Change in fair value | 67 | |
Reclassification of warrant liability to common equity upon Merger | (370) | |
Put options on convertible promissory notes [Member] | ||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Beginning balance | 979 | |
Change in fair value | 169 | |
Put option at issuance of convertible promissory notes | 828 | |
Conversion of convertible promissory notes | (1,976) | |
Contingent Consideration [Member] | ||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Beginning balance | $ 11,948 | 9,708 |
Change in fair value | 131 | 2,240 |
Ending balance | $ 12,079 | $ 11,948 |
Derivative Financial Instrume_2
Derivative Financial Instruments - Additional Information (Detail) $ in Thousands | Sep. 30, 2018USD ($) |
Prepaid Expenses and Other Current Assets [Member] | |
Derivative [Line Items] | |
Derivative financial instruments estimated fair value | $ 4 |
Forward Exchange Contracts [Member] | |
Derivative [Line Items] | |
Unsettled forward exchange contracts to purchase foreign currency | 3,100 |
Derivative liabilities, fair value | $ 3,100 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | Jul. 30, 2018 | Jul. 12, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | Apr. 28, 2017 |
Class of Warrant or Right [Line Items] | ||||||
Issuance of common stock upon at the market offerings, net | $ 493 | $ 991 | ||||
Common stock, par value | $ 0.001 | $ 0.001 | ||||
Value of shares sold prior to amendment | $ 45,792 | |||||
Common and preferred stock, shares authorized | 201,000,000 | |||||
Common stock, shares authorized | 200,000,000 | 500,000,000 | ||||
Preferred stock, shares authorized | 1,000,000 | |||||
Preferred stock, par value | $ 0.001 | |||||
Common Stock [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Common stock, shares issued | 4,250,000 | |||||
Value of shares sold prior to amendment | $ 4 | |||||
Underwriters Public Offering [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Issuance of common stock upon at the market offerings, net | $ 45,800 | |||||
Underwriters Public Offering [Member] | Common Stock [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Common stock, shares issued | 4,250,000 | |||||
Share price | $ 11.50 | |||||
H.C. Wainwright & Co., LLC [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Common stock, par value | $ 0.001 | |||||
Sales commissions in fixed percentage of gross proceeds per share | 3.00% | |||||
Common stock, shares sold | 46,900 | |||||
Net proceeds from sale of shares | $ 500 | |||||
H.C. Wainwright & Co., LLC [Member] | Common Stock [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Value of shares sold prior to amendment | $ 2,300 | |||||
H.C. Wainwright & Co., LLC [Member] | Maximum [Member] | ||||||
Class of Warrant or Right [Line Items] | ||||||
Amount available to sell under equity program | $ 60,000 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of Company's Common Stock (Detail) - shares | Sep. 30, 2018 | Dec. 31, 2017 |
Equity [Abstract] | ||
Common stock authorized | 200,000,000 | 500,000,000 |
Common stock outstanding | 35,120,540 | 30,509,522 |
Shareholders' Equity - Company'
Shareholders' Equity - Company's Shares of Common Stock Reserved for Issuance (Detail) - shares | Sep. 30, 2018 | Dec. 31, 2017 |
Class of Warrant or Right [Line Items] | ||
Total shares reserved | 4,468,840 | 4,072,391 |
Warrants from Mast acquired in Merger [Member] | ||
Class of Warrant or Right [Line Items] | ||
Total shares reserved | 750,840 | 1,152,231 |
Warrants Converted Pursuant to Merger [Member] | ||
Class of Warrant or Right [Line Items] | ||
Total shares reserved | 72,869 | 74,992 |
April 2017 SVB Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Total shares reserved | 24,725 | 24,725 |
June 2017 SVB Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Total shares reserved | 41,736 | 41,736 |
Prefunded Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Total shares reserved | 775,000 | 775,000 |
Stock Options Outstanding [Member] | ||
Class of Warrant or Right [Line Items] | ||
Total shares reserved | 2,634,295 | 1,916,832 |
Issued and Unvested RSU's [Member] | ||
Class of Warrant or Right [Line Items] | ||
Total shares reserved | 169,375 | 86,875 |
Shareholders' Equity - Summar_2
Shareholders' Equity - Summary of Outstanding Warrants for Company's Common Stock (Detail) | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Class of Warrant or Right [Line Items] | |
Shares Underlying Outstanding Warrants | 1,665,170 |
Exercise Price One [Member] | |
Class of Warrant or Right [Line Items] | |
Shares Underlying Outstanding Warrants | 314,446 |
Exercise Price | $ / shares | $ 52.50 |
Expiration Date | 2019-11 |
Exercise Price Two [Member] | |
Class of Warrant or Right [Line Items] | |
Shares Underlying Outstanding Warrants | 32,467 |
Exercise Price | $ / shares | $ 7 |
Expiration Date | 2020-08 |
Exercise Price Three [Member] | |
Class of Warrant or Right [Line Items] | |
Shares Underlying Outstanding Warrants | 403,927 |
Exercise Price | $ / shares | $ 29.40 |
Expiration Date | 2021-02 |
Exercise Price Four [Member] | |
Class of Warrant or Right [Line Items] | |
Shares Underlying Outstanding Warrants | 72,869 |
Exercise Price | $ / shares | $ 8.98 |
Expiration Date | 2021-06 |
Exercise Price Five [Member] | |
Class of Warrant or Right [Line Items] | |
Shares Underlying Outstanding Warrants | 24,725 |
Exercise Price | $ / shares | $ 9.10 |
Expiration Date | 2027-04 |
Exercise Price Six [Member] | |
Class of Warrant or Right [Line Items] | |
Shares Underlying Outstanding Warrants | 41,736 |
Exercise Price | $ / shares | $ 5.39 |
Expiration Date | 2027-06 |
Exercise Price Seven [Member] | |
Class of Warrant or Right [Line Items] | |
Shares Underlying Outstanding Warrants | 775,000 |
Exercise Price | $ / shares | $ 0.01 |
Expiration Date | 2024-10 |
Commitments - Additional Inform
Commitments - Additional Information (Detail) | Nov. 29, 2017USD ($) | Mar. 23, 2017USD ($)ft² | Sep. 30, 2018USD ($) | Nov. 30, 2019USD ($) | Jan. 31, 2019USD ($) |
Commitments And Contingencies [Line Items] | |||||
Lease office space | ft² | 13,707 | ||||
Lease commencement date | Jan. 1, 2018 | Jul. 1, 2017 | |||
Lease expiration date | Jul. 31, 2021 | May 31, 2020 | Sep. 30, 2022 | ||
Lease agreement date | Jun. 19, 2014 | ||||
Monthly base rent | $ 13,000 | $ 44,000 | $ 6,000 | ||
Percentage of lease increase | 2.00% | 3.00% | |||
Employment agreement description | Upon termination without cause, and not as a result of death or disability, each of such officers is entitled to receive a payment of base salary for twelve months and pro-rated portion of their unpaid bonus following termination of employment and such officer will be entitled to continue to receive coverage under medical and dental benefit plans for twelve months or until such officer is covered under a separate plan from another employer. Upon a termination other than for cause or for good reason within twelve months following a change in control, each of such officers is entitled to receive a payment of base salary for eighteen months and one-hundred percent of their unpaid bonus following termination of employment and such officer will be entitled to continue to receive coverage under medical and dental benefit plans for twelve months or until such officer is covered under a separate plan from another employer and will also be entitled to certain acceleration of such officer's outstanding unvested options at the time of such termination | ||||
Percentage of unpaid bonus to be paid upon termination other than for cause or for good reason | 100.00% | ||||
Scenario, Forecast [Member] | |||||
Commitments And Contingencies [Line Items] | |||||
Monthly base rent | $ 5,600 | $ 5,000 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2018shares | |
Stock Options [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Dividend yield | 0.00% |
2008 Stock Option Plan [Member] | Stock Options [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Vesting interval period | quarterly |
Vesting expiration period | 10 years |
Issuance of stock based awards | 0 |
2008 Stock Option Plan [Member] | Restricted Stock [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Vesting interval period | quarterly |
Vesting period | 4 years |
Vesting expiration period | 10 years |
2008 Stock Option Plan [Member] | Tranche One [Member] | Stock Options [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Vesting period | 3 years |
2008 Stock Option Plan [Member] | Tranche Two [Member] | Stock Options [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Vesting period | 4 years |
2015 Omnibus Incentive Option Plan [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Common stock available for grant | 2,042,218 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock-based Awards for 2008 Plan and 2015 Plan (Detail) - 2008 Plan and 2015 Plan [Member] - shares | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock Options, Outstanding at beginning balance | 1,916,832 | 2,129,856 |
Stock Options, Granted | 1,016,720 | 42,500 |
Stock Options, Exercised | (175,407) | (118,213) |
Stock Options, Forfeited | (123,850) | (447,065) |
Stock Options, Outstanding at ending balance | 2,634,295 | 1,607,078 |
RSUs, Outstanding at beginning balance | 86,875 | |
RSUs, Granted | 120,000 | 122,588 |
RSUs, Exercised | (37,500) | (72,361) |
RSUs, Forfeited | (227) | |
RSUs, Outstanding at ending balance | 169,375 | 50,000 |
Total, Outstanding at beginning balance | 2,003,707 | 2,129,856 |
Total, Granted | 1,136,720 | 165,088 |
Total, Exercised | (212,907) | (190,574) |
Total, Forfeited | (123,850) | (447,292) |
Total, Outstanding at ending balance | 2,803,670 | 1,657,078 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock-based Compensation Expense included in Accompanying Statements of Operations and Comprehensive Loss (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | $ 1,988 | $ 114 | $ 2,792 | $ 350 |
Research and Development [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 813 | 38 | 1,186 | 112 |
General and Administrative [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | $ 1,175 | $ 76 | $ 1,606 | $ 238 |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Anti-dilutive Weighted-Average Equity Instruments Excluded from Calculation of Diluted Net Loss Per Share (Detail) - shares | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Earnings Per Share Basic [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 4,472,887 | 3,629,158 |
Awards under Equity Incentive Plan [Member] | ||
Earnings Per Share Basic [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 2,634,295 | 1,607,078 |
Unvested Restricted Shares and Restricted Stock Units [Member] | ||
Earnings Per Share Basic [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 173,422 | 78,396 |
Derivative Call Option [Member] | ||
Earnings Per Share Basic [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 650,000 | |
Warrants to Purchase Common Stock [Member] | ||
Earnings Per Share Basic [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 1,665,170 | 1,293,684 |