Marinus Pharmaceuticals (MRNS) 10-Q 29 Oct 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Oct. 26, 2018
Document and Entity Information [Abstract]
Entity Registrant Name	MARINUS PHARMACEUTICALS INC
Entity Central Index Key	1,267,813
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		40,525,013
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q3

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 19,662	$ 33,531
Short-term investments	19,967	19,861
Prepaid expenses and other current assets	1,188	978
Total current assets	40,817	54,370
Property and equipment, net	1,282	1,338
Investments		4,964
Total assets	42,099	60,672
Current liabilities:
Accounts payable	2,917	927
Accrued expenses	3,960	1,617
Total current liabilities	6,877	2,544
Other long-term liabilities	100	120
Total liabilities	6,977	2,664
Stockholders' equity:
Preferred stock, $0.001 par value; 25,000,000 shares authorized, no shares issued and outstanding
Common stock, $0.001 par value; 100,000,000 shares authorized, 40,554,244 issued and 40,525,013 outstanding at September 30, 2018 and 40,549,936 issued and 40,520,705 outstanding at December 31, 2017	41	41
Additional paid-in capital	206,450	202,790
Treasury stock at cost, 29,231 shares at September 30, 2018 and December 31, 2017
Accumulated other comprehensive loss	(28)	(96)
Accumulated deficit	(171,341)	(144,727)
Total stockholders’ equity	35,122	58,008
Total liabilities and stockholders’ equity	$ 42,099	$ 60,672

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
CONSOLIDATED BALANCE SHEETS
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	25,000,000	25,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	40,554,244	40,549,936
Common stock, shares outstanding	40,525,013	40,520,705
Treasury stock, shares	29,231	29,231

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Expenses:
Research and development	$ 9,148	$ 2,642	$ 20,307	$ 9,032
General and administrative	2,073	1,571	6,599	5,074
Loss from operations	(11,221)	(4,213)	(26,906)	(14,106)
Interest income	111	45	292	116
Interest expense		(3)		(159)
Other income (expense)		1		(11)
Net loss	$ (11,110)	$ (4,170)	$ (26,614)	$ (14,160)
Per share information:
Net loss per share of common stock-basic and diluted (in dollars per share)	$ (0.27)	$ (0.15)	$ (0.66)	$ (0.60)
Basic and diluted weighted average shares outstanding (in shares)	40,407,146	28,666,656	40,392,084	23,531,745
Net loss	$ (11,110)	$ (4,170)	$ (26,614)	$ (14,160)
Other comprehensive loss:
Unrealized gain (loss) on available-for-sale securities	42	(18)	68	(18)
Total comprehensive loss	$ (11,068)	$ (4,188)	$ (26,546)	$ (14,178)

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash flows from operating activities
Net loss	$ (26,614)	$ (14,160)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	94	35
Stock-based compensation expense	3,645	2,251
Amortization of debt issuance costs		4
Amortization of discount on investments	(74)	(3)
Changes in operating assets and liabilities:
Prepaid expenses and other assets	(210)	(383)
Accounts payable and accrued expenses	4,475	(2,080)
Net cash used in operating activities	(18,684)	(14,336)
Cash flows from investing activities
Purchases of investments		(24,892)
Maturities of short-term investments	5,000	3,426
Purchases of property and equipment	(6)	(192)
Net cash provided by (used in) investing activities	4,994	(21,658)
Cash flows from financing activities
Proceeds from exercise of stock options	14
Principal payments of notes payable		(5,247)
Proceeds from equity offerings, net of offering costs		52,593
Repayments of short-term bank borrowings	(193)
Net cash (used in) provided by financing activities	(179)	47,346
Net (decrease) increase in cash and cash equivalents	(13,869)	11,352
Cash and cash equivalents—beginning of period	33,531	26,178
Cash and cash equivalents—end of period	19,662	37,530
Supplemental disclosure of cash flow information
Cash paid for interest		184
Accrued equity offering costs		$ 45
Property and equipment in accounts payable	$ 31

Description of the Business and

Description of the Business and Liquidity	9 Months Ended
	Sep. 30, 2018
Description of the Business and Liquidity
Description of the Business and Liquidity	1. Description of the Business and Liquidity We are a clinical stage biopharmaceutical company focused on developing and commercializing innovative therapeutics to treat epilepsy and neuropsychiatric disorders. Our clinical stage product candidate, ganaxolone, is a positive allosteric modulator of the GABA A receptor being developed in three different dose forms (intravenous, oral capsule and oral liquid) intended to maximize therapeutic reach to adult and pediatric patient populations in acute and chronic care, in-patient and self-administered settings. The GABA A receptor is a well‑characterized target in the brain known for both anti‑seizure, anti-depression and anti‑anxiety effects. Our primary focus to date has been directed towards developing business strategies, conducting research and development activities, and conducting preclinical testing and human clinical trials for our product candidate. Liquidity We have not generated any product revenues and have incurred operating losses since inception. There is no assurance that profitable operations will ever be achieved, and if achieved, could be sustained on a continuing basis. In addition, development activities, clinical and preclinical testing, and commercialization of our product candidates will require significant additional financing. Our accumulated deficit as of September 30, 2018 was $171.3 million and we expect to incur substantial losses in future periods. We plan to finance our future operations with a combination of proceeds from the issuance of equity securities, the issuance of additional debt, potential collaborations and revenues from potential future product sales, if any. We have not generated positive cash flows from operations, and there are no assurances that we will be successful in obtaining an adequate level of financing for the development and commercialization of our planned product candidates. In connection with the closing of a secondary public offering during the third quarter of 2017, we issued a total of 10,733,334 shares of common stock resulting in aggregate net proceeds, after underwriting discounts and commissions and other estimated offering expenses, of $37.7 million. We believe that our cash, cash equivalents and investment balance as of September 30, 2018 is adequate to fund our operations for at least the next 12 months.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2018
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Basis of Presentation The unaudited interim consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Accordingly, they do not include all information and disclosures necessary for a presentation of our financial position, results of operations and cash flows in conformity with generally accepted accounting principles in the United States of America (GAAP) for annual financial statements. In the opinion of management, these unaudited interim consolidated financial statements reflect the elimination of all intercompany accounts and transactions and all adjustments, consisting primarily of normal recurring accruals, necessary for a fair presentation of our financial position and results of operations and cash flows for the periods presented. The results of operations for interim periods are not necessarily indicative of the results for the full year. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2017 and accompanying notes thereto included in our annual report on Form 10-K filed with the SEC on March 6, 2018. Use of Estimates The preparation of financial statements in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from such estimates. Recent Accounting Pronouncements In January 2016, the Financial Accounting Standard Board ( FASB) issued Accounting Standards Update ( ASU) 2016-01, Financial Instruments - Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities , which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. ASU 2016-01 will be effective for annual periods and interim periods within those annual periods beginning after December 15, 2017 and early adoption is not permitted. We adopted this ASU in the first quarter of 2018. The adoption of this ASU did not have a material impact on our interim consolidated financial statements. In February 2016, the FASB issued Accounting Standards Update (ASU) 2016-02, Leases , which requires that lease arrangements longer than 12 months result in an entity recognizing an asset and liability. The updated guidance is effective for interim and annual periods beginning after December 15, 2018, and early adoption is permitted. We are currently evaluating the impact of the updated guidance on our interim or annual consolidated financial statements as we have minimal lease commitments . In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows , which amends the guidance in Accounting Standards Codification (ASC) 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of the ASU is to reduce the diversity in practice that has resulted from the lack of consistent principles on this topic. The guidance in the ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We adopted this ASU in the first quarter of 2018. The adoption of this ASU did not have a material impact on our interim consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, Scope of Modification Accounting, which amends the scope of modification accounting for share-based payment arrangements. The ASU provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC 718. Specifically, an entity would not apply modification accounting if the fair value, vesting conditions, and classification of the awards are the same immediately before and after the modification. For all entities, the ASU is effective for annual reporting periods, including interim periods within those annual reporting periods, beginning after December 15, 2017, with early adoption permitted. We adopted this ASU in the first quarter of 2018. The adoption of this ASU did not have a material impact on our interim consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which superseded ASC 505-50 and expands the scope of ASC 718 to include all share-based payment arrangements related to the acquisition of goods and services from both nonemployees and employees. As a result, most of the guidance in ASC 718 associated with employee share-based payments, including most of its requirements related to classification and measurement, applies to nonemployee share-base payment arrangements. We early-adopted this guidance effective April 1, 2018. The adoption of this guidance did not have a material impact on our interim consolidated financial statements.

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Sep. 30, 2018
Fair Value Measurements
Fair Value Measurements	3. Fair Value Measurements FASB accounting guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability (the exit price) in an orderly transaction between market participants at the measurement date. The accounting guidance outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. In determining fair value, we use quoted prices and observable inputs. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from independent sources. The fair value hierarchy is broken down into three levels based on the source of inputs as follows: · Level 1 — Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities. · Level 2 — Valuations based on observable inputs and quoted prices in active markets for similar assets and liabilities. · Level 3 — Valuations based on inputs that are unobservable and models that are significant to the overall fair value measurement. If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument. Valuation Techniques - Level 2 Inputs The Company estimates the fair values of its financial instruments categorized as level 2 in the fair value hierarchy, including U.S. Treasury securities, by taking into consideration valuations obtained from third-party pricing services. The pricing services use industry standard valuation models, including both income- and market-based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities, benchmark yields, issuer credit spreads, benchmark securities, and other observable inputs. The Company obtains a single price for each financial instrument and does not adjust the prices obtained from the pricing service. The Company validates the prices provided by its third-party pricing services by reviewing their pricing methods, obtaining market values from other pricing sources and comparing them to the share prices presented by the third-party pricing services. After completing its validation procedures, the Company did not adjust or override any fair value measurements provided by its third-party pricing services as of September 30, 2018. The following fair value hierarchy table presents information about each major category of our financial assets and liabilities measured at fair value on a recurring basis (in thousands): Level 1 Level 2 Level 3 Total September 30, 2018 Assets Money market funds (cash equivalents) $ 7,537 $ — $ — $ 7,537 U.S. Treasury securities — 19,967 — 19,967 Total assets $ 7,537 $ 19,967 $ — $ 27,504 December 31, 2017 Assets Money market funds (cash equivalents) $ 33,531 $ — $ — $ 33,531 U.S. Treasury securities — 24,825 — 24,825 Total assets $ 33,531 $ 24,825 $ — $ 58,356

Accrued Expenses

Accrued Expenses	9 Months Ended
	Sep. 30, 2018
Accrued Expenses
Accrued Expenses	4. Accrued Expenses At September 30, 2018 and December 31, 2017 accrued expenses consisted of the following (in thousands): September 30, December 31, 2018 2017 Payroll and related costs $ 1,234 $ 1,323 Clinical trials and drug development 2,224 156 Professional fees 200 113 Other 302 25 Total accrued expenses $ 3,960 $ 1,617

Notes Payable

Notes Payable	9 Months Ended
	Sep. 30, 2018
Notes Payable
Notes Payable	5. Notes Payable In 2014, we borrowed an aggregate of $7.0 million in connection with a Loan and Security Agreement, as amended, with an interest rate equal to the greater of (a) prime rate plus 3.25% or (b) 6.5%. In July 2017, we paid in full the entire outstanding term loans balance of $3.5 million and accrued interest, with no penalty for prepayment. Interest expense related to the term loans was $3 thousand and $159 thousand for the three and nine months ended September 30, 2017. As of September 30, 2017 we had no accrued interest.

Loss Per Share of Common Stock

Loss Per Share of Common Stock	9 Months Ended
	Sep. 30, 2018
Loss Per Share of Common Stock
Loss Per Share of Common Stock	6. Loss Per Share of Common Stock Basic loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during each period. Diluted loss per share includes the effect, if any, from the potential exercise or conversion of securities, such as convertible preferred stock, convertible notes payable, warrants, stock options, and unvested restricted stock, which would result in the issuance of incremental shares of common stock. In computing the basic and diluted net loss per share applicable to common stockholders, the weighted average number of shares remains the same for both calculations due to the fact that when a net loss exists, dilutive shares are not included in the calculation. These potentially dilutive securities are more fully described in Note 8, and summarized in the table below: September 30, 2018 2017 Restricted stock 117,867 239,800 Stock options 4,832,109 2,910,761 4,949,976 3,150,561

Investments

Investments	9 Months Ended
	Sep. 30, 2018
Investments
Investments	7. Investments As of September 30, 2018, our investments consisted of U.S. Treasury securities, maturing at various dates through January 2019. These securities are classified as short-term investments on our consolidated balance sheets based on maturity and are classified as available-for-sale and are recorded at fair value. As of September 30, 2018, all four of our U.S. Treasury securities were in an unrealized loss position, none of which had been in an unrealized loss position for 12 months or greater. Total amortized cost and fair value were $19.9 million and $20.0 million, respectively, as of September 30, 2018. Based on review of these securities, we believe that the cost basis of these available-for-sale securities is recoverable and that there were no other-than-temporary impairments on these securities as of September 30, 2018.

Stockholders' Equity

Stockholders' Equity	9 Months Ended
	Sep. 30, 2018
Stockholders' Equity
Stockholders' Equity	8. Stockholders’ Equity In 2005, we adopted the 2005 Stock Option and Incentive Plan (2005 Plan) that authorizes us to grant options, restricted stock and other equity-based awards. As of September 30, 2018, 362,112 options to purchase shares of common stock were outstanding pursuant to grants in connection with the 2005 Plan. No additional shares are available for issuance under the 2005 Plan. In August 2014, we adopted our 2014 Equity Incentive Plan, amended in May 2017 (2014 Plan), that authorizes us to grant options, restricted stock, and other equity-based awards, subject to adjustment in accordance with the 2014 Plan. The amount, terms of grants, and exercisability provisions are determined and set by our board of directors. As of September 30, 2018, 4,318,997 options to purchase shares of common stock and 117,867 shares of restricted stock were outstanding pursuant to grants in connection with the 2014 Plan, and 1,256,003 shares of common stock were available for future issuance. The amount, terms of grants, and exercisability provisions are determined and set by our board of directors. Stock Options There were 4,832,109 stock options outstanding as of September 30, 2018 at a weighted-average exercise price of $5.54 per share. During the nine months ended September 30, 2018, 1,212,000 options were granted to employees, directors and consultants at a weighted-average exercise price of $6.45 per share. Total compensation cost recognized for all stock option awards in the statements of operations is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Research and development $ 458 $ 172 $ 1,274 $ 542 General and administrative 695 381 2,302 1,336 Total $ 1,153 $ 553 $ 3,576 $ 1,878 Restricted Stock All issued and outstanding restricted shares of common stock are time-based, and become vested between one and three years after the grant date. Compensation expense is recorded ratably over the requisite service period. Compensation expense related to restricted stock is measured based on the fair value using the closing market price of our common stock on the date of the grant. During the nine months ended September 30, 2017, we issued 245,200 restricted shares of common stock to employees, directors and consultants. We did not issue any restricted shares of common stock during the nine months ended September 30, 2018. As of September 30, 2018 there were 117,867 restricted shares of common stock outstanding, and 113,933 shares vested during the three and nine months ended September 30, 2018. Total compensation cost recognized for all restricted stock awards in the statements of operations is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Research and development $ 7 $ 51 $ 18 $ 100 General and administrative 11 128 51 273 Total $ 18 $ 179 $ 69 $ 373

Commitments

Commitments	9 Months Ended
	Sep. 30, 2018
Commitments
Commitments	9. Commitments In March 2017, the Company and CyDex Pharmaceuticals, Inc. (CyDex) entered into a License Agreement and a Supply Agreement. Under the terms of the License Agreement, CyDex has granted us an exclusive license to use CyDex’s Captisol drug formulation system and related intellectual property in connection with the development and commercialization of ganaxolone in any and all therapeutic uses in humans, with some exceptions. As consideration for this license, we paid an upfront fee which was recorded as research and development expense in the three months ended March 31, 2017, and are required to make additional payments in the future upon achievement of various specified clinical and regulatory milestones. We will also be required to pay royalties to CyDex on sales of ganaxolone, if successfully developed, in the low-to-mid single digits based on levels of annual net sales. Under the terms of the Supply Agreement, we are required to purchase all of our requirements for Captisol with respect to ganaxolone from CyDex, and CyDex is required to supply us with Captisol for such purposes, subject to certain limitations.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2018
Summary of Significant Accounting Policies
Basis of Presentation	Basis of Presentation The unaudited interim consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Accordingly, they do not include all information and disclosures necessary for a presentation of our financial position, results of operations and cash flows in conformity with generally accepted accounting principles in the United States of America (GAAP) for annual financial statements. In the opinion of management, these unaudited interim consolidated financial statements reflect the elimination of all intercompany accounts and transactions and all adjustments, consisting primarily of normal recurring accruals, necessary for a fair presentation of our financial position and results of operations and cash flows for the periods presented. The results of operations for interim periods are not necessarily indicative of the results for the full year. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2017 and accompanying notes thereto included in our annual report on Form 10-K filed with the SEC on March 6, 2018.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from such estimates.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In January 2016, the Financial Accounting Standard Board ( FASB) issued Accounting Standards Update ( ASU) 2016-01, Financial Instruments - Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities , which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. ASU 2016-01 will be effective for annual periods and interim periods within those annual periods beginning after December 15, 2017 and early adoption is not permitted. We adopted this ASU in the first quarter of 2018. The adoption of this ASU did not have a material impact on our interim consolidated financial statements. In February 2016, the FASB issued Accounting Standards Update (ASU) 2016-02, Leases , which requires that lease arrangements longer than 12 months result in an entity recognizing an asset and liability. The updated guidance is effective for interim and annual periods beginning after December 15, 2018, and early adoption is permitted. We are currently evaluating the impact of the updated guidance on our interim or annual consolidated financial statements as we have minimal lease commitments . In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows , which amends the guidance in Accounting Standards Codification (ASC) 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of the ASU is to reduce the diversity in practice that has resulted from the lack of consistent principles on this topic. The guidance in the ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We adopted this ASU in the first quarter of 2018. The adoption of this ASU did not have a material impact on our interim consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, Scope of Modification Accounting, which amends the scope of modification accounting for share-based payment arrangements. The ASU provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC 718. Specifically, an entity would not apply modification accounting if the fair value, vesting conditions, and classification of the awards are the same immediately before and after the modification. For all entities, the ASU is effective for annual reporting periods, including interim periods within those annual reporting periods, beginning after December 15, 2017, with early adoption permitted. We adopted this ASU in the first quarter of 2018. The adoption of this ASU did not have a material impact on our interim consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which superseded ASC 505-50 and expands the scope of ASC 718 to include all share-based payment arrangements related to the acquisition of goods and services from both nonemployees and employees. As a result, most of the guidance in ASC 718 associated with employee share-based payments, including most of its requirements related to classification and measurement, applies to nonemployee share-base payment arrangements. We early-adopted this guidance effective April 1, 2018. The adoption of this guidance did not have a material impact on our interim consolidated financial statements.

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	9 Months Ended
	Sep. 30, 2018
Fair Value Measurements
Summary of major categories of financial assets and liabilities measured at fair value on a recurring basis	The following fair value hierarchy table presents information about each major category of our financial assets and liabilities measured at fair value on a recurring basis (in thousands): Level 1 Level 2 Level 3 Total September 30, 2018 Assets Money market funds (cash equivalents) $ 7,537 $ — $ — $ 7,537 U.S. Treasury securities — 19,967 — 19,967 Total assets $ 7,537 $ 19,967 $ — $ 27,504 December 31, 2017 Assets Money market funds (cash equivalents) $ 33,531 $ — $ — $ 33,531 U.S. Treasury securities — 24,825 — 24,825 Total assets $ 33,531 $ 24,825 $ — $ 58,356

Accrued Expenses (Tables)

Accrued Expenses (Tables)	9 Months Ended
	Sep. 30, 2018
Accrued Expenses
Schedule of accrued expenses	At September 30, 2018 and December 31, 2017 accrued expenses consisted of the following (in thousands): September 30, December 31, 2018 2017 Payroll and related costs $ 1,234 $ 1,323 Clinical trials and drug development 2,224 156 Professional fees 200 113 Other 302 25 Total accrued expenses $ 3,960 $ 1,617

Loss Per Share of Common Stock

Loss Per Share of Common Stock (Tables)	9 Months Ended
	Sep. 30, 2018
Loss Per Share of Common Stock
Schedule of antidilutive securities excluded from the computation of diluted weighted average shares outstanding	September 30, 2018 2017 Restricted stock 117,867 239,800 Stock options 4,832,109 2,910,761 4,949,976 3,150,561

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)	9 Months Ended
	Sep. 30, 2018
Stock options
Schedule of total compensation cost recognized in the statement of operations	Total compensation cost recognized for all stock option awards in the statements of operations is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Research and development $ 458 $ 172 $ 1,274 $ 542 General and administrative 695 381 2,302 1,336 Total $ 1,153 $ 553 $ 3,576 $ 1,878
Restricted stock
Schedule of total compensation cost recognized in the statement of operations	Total compensation cost recognized for all restricted stock awards in the statements of operations is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Research and development $ 7 $ 51 $ 18 $ 100 General and administrative 11 128 51 273 Total $ 18 $ 179 $ 69 $ 373

Organization and Description of

Organization and Description of the Business (Details) $ in Thousands	3 Months Ended
	Sep. 30, 2017USD ($)shares	Sep. 30, 2018USD ($)item	Dec. 31, 2017USD ($)
Number of dose forms for modulator | item		3
Liquidity
Accumulated deficit		$ (171,341)	$ (144,727)
Secondary public offering
Liquidity
Issuance of common stock in connection with secondary public offering (in shares) | shares	10,733,334
Proceeds from issuance of common stock, net of issuance costs	$ 37,700

Fair Value Measurements (Detail

Fair Value Measurements (Details) - Recurring basis - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Assets
Total assets	$ 27,504	$ 58,356
U.S. Treasury securities
Assets
Investments	19,967	24,825
Money market funds
Assets
Cash and cash equivalents, fair value	7,537	33,531
Level 1
Assets
Total assets	7,537	33,531
Level 1 | Money market funds
Assets
Cash and cash equivalents, fair value	7,537	33,531
Level 2
Assets
Total assets	19,967	24,825
Level 2 | U.S. Treasury securities
Assets
Investments	$ 19,967	$ 24,825

Accrued Expenses (Details)

Accrued Expenses (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Accrued Expenses
Payroll and related costs	$ 1,234	$ 1,323
Clinical trials and drug development	2,224	156
Professional fees	200	113
Other	302	25
Total accrued expenses	$ 3,960	$ 1,617

Notes Payable (Details)

Notes Payable (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended	9 Months Ended	12 Months Ended
	Jul. 31, 2017	Sep. 30, 2017	Sep. 30, 2017	Dec. 31, 2014
Notes Payable
Interest Expense		$ 3	$ 159
Credit facility
Notes Payable
Proceeds from the issuance of debt				$ 7,000
Accrued interest rate (as a percent)				6.50%
Term loans balance paid in full	$ 3,500
Penalty for prepayment	$ 0
Interest Expense		3	159
Accrued interest		$ 0	$ 0
Credit facility | Prime rate
Notes Payable
Variable interest rate basis				prime rate
Spread on variable rate basis (as a percent)				3.25%

Loss Per Share of Common Stoc_2

Loss Per Share of Common Stock (Details) - shares	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Loss per share of common stock
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares)	4,949,976	3,150,561
Restricted stock
Loss per share of common stock
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares)	117,867	239,800
Stock options.
Loss per share of common stock
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares)	4,832,109	2,910,761

Investments (Details)

Investments (Details) - U.S. Treasury securities $ in Thousands	Sep. 30, 2018USD ($)security
Schedule of Available-for-sale Securities [Line Items]
Number of securities in an unrealized loss position | security	4
Number of securities in an unrealized loss position for 12 months or greater | security	0
Total amortized cost	$ 19,900
Total fair value	20,000
Other-than-temporary impairments	$ 0

Stockholders' Equity (Details)

Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Stock options
Stock option and incentive plans
Total compensation cost	$ 1,153	$ 553	$ 3,576	$ 1,878
Stock Options
Outstanding (in shares)	4,832,109		4,832,109
Outstanding, weighted-average exercise price (in dollars per share)	$ 5.54		$ 5.54
Granted (in shares)			1,212,000
Granted (in dollars per share)			$ 6.45
Stock options | Research and development
Stock option and incentive plans
Total compensation cost	$ 458	172	$ 1,274	542
Stock options | General and administrative
Stock option and incentive plans
Total compensation cost	695	381	2,302	1,336
Restricted stock
Stock option and incentive plans
Total compensation cost	$ 18	179	$ 69	$ 373
Shares
Outstanding (in shares)	117,867		117,867
Issued (in shares)			0	245,200
Vested (in shares)			113,933
Restricted stock | Minimum
Stock option and incentive plans
Vesting period			1 year
Restricted stock | Maximum
Stock option and incentive plans
Vesting period			3 years
Restricted stock | Research and development
Stock option and incentive plans
Total compensation cost	$ 7	51	$ 18	$ 100
Restricted stock | General and administrative
Stock option and incentive plans
Total compensation cost	$ 11	$ 128	$ 51	$ 273
2005 Plan
Stock option and incentive plans
Common stock reserved for issuance (in shares)	0		0
2005 Plan | Stock options
Stock Options
Outstanding (in shares)	362,112		362,112
2014 Plan
Stock option and incentive plans
Common stock reserved for issuance (in shares)	1,256,003		1,256,003
2014 Plan | Stock options
Stock Options
Outstanding (in shares)	4,318,997		4,318,997
2014 Plan | Restricted stock
Shares
Outstanding (in shares)	117,867		117,867