Marinus Pharmaceuticals (MRNS) 10-K 16 Mar 20 2019 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2019	Mar. 12, 2020	Jun. 28, 2019
Document and Entity Information [Abstract]
Document Type	10-K
Document Period End Date	Dec. 31, 2019
Entity Registrant Name	MARINUS PHARMACEUTICALS INC
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 206,725,520
Entity Common Stock, Shares Outstanding		86,711,035
Entity Central Index Key	0001267813
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	FY
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 90,943	$ 67,727
Short-term investments	739	4,998
Prepaid expenses and other current assets	2,452	1,215
Total current assets	94,134	73,940
Property and equipment, net	2,265	1,294
Other assets	2,443
Total assets	98,842	75,234
Current liabilities:
Accounts payable	2,763	2,472
Accrued expenses	5,268	4,437
Total current liabilities	8,031	6,909
Other long-term liabilities	3,042
Total liabilities	11,073	6,909
Series A convertible preferred stock, $0.001 par value; 25,000,000 shares authorized, 30,000 and 0 shares issued and outstanding at December 31, 2019 and 2018	28,200
Commitments and contingencies (Note 10)
Stockholders’ equity:
Common stock, $0.001 par value; 100,000,000 shares authorized, 86,500,353 issued and 86,471,122 outstanding at December 31, 2019 and 52,548,244 issued and 52,519,013 outstanding at December 31, 2018	87	53
Additional paid-in capital	295,056	249,727
Treasury stock at cost, 29,231 shares at December 31, 2019 and 2018
Accumulated other comprehensive income (loss)		(2)
Accumulated deficit	(235,574)	(181,453)
Total stockholders’ equity	59,569	68,325
Total liabilities and stockholders’ equity	$ 98,842	$ 75,234

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2019	Dec. 31, 2018
Series A convertible preferred stock, par value (in dollars per share)	$ 0.001
Series A convertible preferred stock, shares authorized	25,000,000
Series A convertible preferred stock, shares issued	30,000	0
Series A convertible preferred stock, shares outstanding	30,000	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	86,500,353	52,548,244
Common stock, shares outstanding	86,471,122	52,519,013
Treasury stock, shares	29,231	29,231

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Expenses:
Research and development	$ 42,966	$ 28,394
General and administrative	11,456	8,785
Loss from operations	(54,422)	(37,179)
Interest income	354	454
Other expense	(53)	(1)
Net loss	$ (54,121)	$ (36,726)
Per share information:
Net loss per share of common stock—basic and diluted	$ (0.99)	$ (0.90)
Basic and diluted weighted average shares outstanding	54,512,778	40,895,406
Net loss	$ (54,121)	$ (36,726)
Other comprehensive income (loss):
Unrealized gain on available-for-sale securities		94
Total comprehensive loss	$ (54,121)	$ (36,632)

CONSOLIDATED STATEMENTS OF STOC

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common StockPublic Offering	Common Stock	Additional Paid-in CapitalPublic Offering	Additional Paid-in Capital	Treasury Stock	Accumulated Other Comprehensive Loss	Accumulated Deficit	Public Offering	Total
Balance at Dec. 31, 2017		$ 41		$ 202,790		$ (96)	$ (144,727)		$ 58,008
Balance (in shares) at Dec. 31, 2017		40,549,936			29,231
Increase (Decrease) in Stockholders' Equity (Deficit)
Stock-based compensation expense				4,788					4,788
Issuance of stock	$ 12		$ 42,135					$ 42,147
Issuance of stock (in shares)	12,000,000
Exercise of stock options				14					14
Exercise of stock options (in shares)		12,308
Forfeiture of restricted stock (in shares)		(14,000)
Unrealized gain (loss) on investments						94			94
Net loss							(36,726)		(36,726)
Balance at Dec. 31, 2018		$ 53		249,727		(2)	(181,453)		68,325
Balance (in shares) at Dec. 31, 2018		52,548,244			29,231
Increase (Decrease) in Stockholders' Equity (Deficit)
Stock-based compensation expense				5,672					5,672
Issuance of common stock under equity distribution agreement, net of expenses of $95		$ 2		2,128					2,130
Issuance of common stock under equity distribution agreement, net of expenses of $95 (in shares)		1,692,289
Issuance of stock	$ 32		$ 37,432					$ 37,464
Issuance of stock (in shares)	32,200,000
Exercise of stock options				97					97
Exercise of stock options (in shares)		80,020
Forfeiture of restricted stock (in shares)		(20,200)
Unrealized gain (loss) on investments						$ 2			2
Net loss							(54,121)		(54,121)
Balance at Dec. 31, 2019		$ 87		$ 295,056			$ (235,574)		$ 59,569
Balance (in shares) at Dec. 31, 2019		86,500,353			29,231

CONSOLIDATED STATEMENTS OF ST_2

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - Common Stock - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Public Offering
Share Price (in dollars per share)	$ 1.25	$ 3.75
Stock issuance costs	$ 2,786	$ 2,853
2017 Equity Distribution Agreement
Stock issuance costs	$ 95

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Cash flows from operating activities
Net loss	$ (54,121)	$ (36,726)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	278	127
Stock-based compensation expense	5,672	4,788
Loss on disposal of fixed assets	42
Noncash lease expense	225
Noncash lease liability	(131)
Amortization of discount on investments	(8)	(79)
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	(1,480)	(237)
Accounts payable and accrued expenses	890	4,285
Net cash used in operating activities	(48,633)	(27,842)
Cash flows from investing activities
Maturities of short-term investments	6,994	20,000
Purchases of short-term investments	(2,725)
Purchases of property and equipment	(388)	(83)
Net cash provided by investing activities	3,881	19,917
Cash flows from financing activities
Proceeds from exercise of stock options	97	14
Proceeds from equity offerings, net of offering costs	67,871	42,300
Repayments of short-term bank borrowings		(193)
Net cash provided by/(used in) financing activities	67,968	42,121
Net decrease in cash and cash equivalents	23,216	34,196
Cash and cash equivalents—beginning of year	67,727	33,531
Cash and cash equivalents—end of year	90,943	67,727
Supplemental disclosure of cash flow information
Financing in accounts payable and accrued expenses	(195)	$ (153)
Operating lease liability	3,357
Operating right-of-use asset	$ 2,458

Organization and Description of

Organization and Description of the Business	12 Months Ended
	Dec. 31, 2019
Organization and Description of the Business
Organization and Description of the Business	1. Organization and Description of the Business We are a clinical stage pharmaceutical company focused on developing and commercializing innovative therapeutics to treat patients suffering from rare seizure disorders. Our clinical stage product candidate, ganaxolone, is a positive allosteric modulator of GABA A that is being developed in formulations for two different routes of administration: intravenous (IV) and oral. Ganaxolone is a synthetic analog of allopregnanolone, an endogenous neurosteroid. The different formulations are intended to maximize potential therapeutic applications of ganaxolone for adult and pediatric patient populations, in both acute and chronic care, and for both in‑patient and self‑administered settings. Ganaxolone acts at both synaptic and extrasynaptic GABA A receptors and exhibits anti‑seizure, antidepressant and anxiolytic properties. 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, preclinical studies and clinical trials, and commercialization of our product candidates will require significant additional financing. Our accumulated deficit as of December 31, 2019 was $235.6 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 concurrent equity financings during the fourth quarter of 2019, we issued a total of 32,200,000 shares of common stock in an underwritten public offering and 30,000 shares of Series A convertible preferred stock in a private placement resulting in aggregate net proceeds, after underwriting discounts and commissions in the public offering and other estimated offering expenses, of $65.7 million. We also raised net proceeds of $2.1 million in connection with the sale of 1,692,289 shares of common stock under our equity distribution agreement. In connection with the closing of an underwritten public offering during the fourth quarter of 2018, we issued a total of 12,000,000 shares of common stock resulting in aggregate net proceeds, after underwriting discounts and commissions and other estimated offering expenses, of $42.1 million.

Summary of Significant Accounti

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2019
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Principles of Consolidation The consolidated financial statements include the accounts of Marinus Pharmaceuticals, Inc. (the Company) and its wholly-owned subsidiary. All intercompany accounts and transactions have been eliminated. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles (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 revenues and expenses during the reporting period. Actual results could differ from such estimates. Fair Value of Financial Instruments and Credit Risk At December 31, 2019 and 2018, our financial instruments included cash equivalents, short-term investments, accounts payable and accrued expenses. The carrying amount of cash equivalents, accounts payable and accrued expenses approximated fair value, given their short-term nature. The carrying amounts of short-term investments are recorded at amortized cost, which for U.S. Treasury securities is based on the current market price of each security at the measurement date. Cash equivalents and certificates of deposit subject us to concentrations of credit risk. However, we invest our cash in accordance with a policy objective that seeks to ensure both liquidity and safety of principal. The policy limits investments to instruments issued by the U.S. government, certain Securities and Exchange Commission (SEC)-registered money market funds that invest only in U.S. government obligations and various other low-risk liquid investment options, and places restrictions on portfolio maturity terms. Cash and Cash Equivalents We consider all highly liquid investments that have maturities of three months or less when acquired to be cash equivalents. As of December 31, 2019 and 2018, we invested a portion of our cash balances in money market investments, which we have included as cash equivalents on our balance sheets. Investments As of December 31, 2019, our investments consisted of certificates of deposit with various financial institutions, with original maturities ranging from six to nine months. All investments were classified as held-to-maturity and were recorded at amortized cost. As of December 31, 2018, our investments consisted of U.S. Treasury securities and are classified as available-for-sale and are recorded at amortized cost with unrealized gains and losses recorded in accumulated other comprehensive loss, as a separate component of stockholders’ equity. Interest income includes interest and dividends, realized gains and losses on sales of securities and other-than-temporary impairment (OTTI) declines in the fair value of securities, if any. U.S. Treasury securities with maturities less than 12 months are classified as short-term investments and maturities greater than 12 months are classified as long-term investments on our balance sheets. The Company reviews its available-for-sale securities for OTTI declines in fair value below its cost basis each quarter and whenever events or changes in circumstances indicate that the cost basis of an asset may not be recoverable. This evaluation is based on a number of factors, including the length of time and the extent to which the fair value has been below its cost basis and adverse conditions related specifically to the security, including any changes to the credit rating of the security, and the intent to sell, or whether the Company will more likely than not be required to sell, the security before recovery of its amortized cost basis. The Company’s assessment of whether a security is other-than-temporarily impaired could change in the future due to new developments or changes in assumptions related to any particular security. If a decline in the fair value of an available-for-sale security in the Company’s investment portfolio is deemed to be other-than-temporary, the Company writes down the security to its current fair value. If the Company intends to sell the security or it is more likely than not that the Company will be forced to sell the security before recovery of the amortized cost of the security, the loss is recognized in net income. Otherwise, the loss is separated into a portion representing a credit loss, which is recorded in net income, and the remainder is recorded in other comprehensive income, net of taxes. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets generally represent payments made for goods or services to be received within one year, and are expensed as the related benefit is received. Property and Equipment Property and equipment consist of laboratory and office equipment and are recorded at cost. Property and equipment are depreciated on a straight‑line basis over their estimated useful lives. We estimate a life of three years for computer equipment, including software, five years for office equipment and furniture, five to fifteen years for laboratory equipment, and six years for leasehold improvements. When property and equipment are sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is included in operating expenses. Impairment of Long‑Lived Assets We review long‑lived assets, including property and equipment, for impairment whenever events or changes in business circumstances indicate that the carrying amount of an asset may not be fully recoverable. If the estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount an impairment loss would be recognized if the carrying value of the asset exceeded its fair value. Fair value is generally determined using discounted cash flows. Research and Development Research and development costs are expensed as incurred. Costs for certain development activities, such as clinical trials, are recognized based on an evaluation of the progress to completion of specific tasks using data such as subject enrollment, monitoring visits, clinical site activations, or information provided to us by our vendors with respect to their actual costs incurred. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected in the financial statements as prepaid or accrued research and development expense, as the case may be. Income Taxes We recognize deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of our assets and liabilities and the expected benefits of net operating loss carryforwards. The impact of changes in tax rates and laws on deferred taxes, if any, applied during the years in which temporary differences are expected to be settled, is reflected in the financial statements in the period of enactment. The measurement of deferred tax assets is reduced, if necessary, if, based on weight of the evidence, it is more likely than not that some, or all, of the deferred tax assets will not be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that such tax rate changes are enacted. At December 31, 2019 and 2018, we have concluded that a full valuation allowance is necessary for our net deferred tax assets. We had no material amounts recorded for uncertain tax positions, interest or penalties in the accompanying financial statements. 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. The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2019 and 2018 (in thousands, except share and per share amounts): Year Ended December 31, 2019 2018 Basic and diluted net loss per share of common stock: Net loss $ (54,121) $ (36,726) Weighted average shares of common stock outstanding 54,512,778 40,895,406 Net loss per share of common stock—basic and diluted $ (0.99) $ (0.90) The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding, as they would be antidilutive: December 31, 2019 2018 Convertible preferred stock 24,000,000 — Restricted stock 32,400 105,200 Stock options 8,540,281 4,951,409 32,572,681 5,056,609 The convertible preferred stock meets the definition of a participating security, however the holders are not obligated to share in our losses. As of December 31, 2019 and 2018, we had no other potentially dilutive securities. Comprehensive Loss Comprehensive loss is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non‑owner sources. As of December 31, 2018, comprehensive loss includes net loss and unrealized gain or loss on available-for-sale securities. Segment Information Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision‑making group, in deciding how to allocate resources and in assessing performance. We view our operations and manage our business in one segment, which is the identification and development of innovative therapeutics to treat rare seizure disorders. Stock‑Based Compensation We account for stock‑based compensation in accordance with the provisions of Accounting Standards Codification (ASC) Topic 718, Compensation—Stock Compensation , or ASC 718, which requires the recognition of expense related to the fair value of stock‑based awards in the statements of operations. For stock options issued to employees, non-employees and members of our board of directors for their services on our board of directors, we estimate the grant‑date fair value of options using the Black‑Scholes option pricing model. The use of the Black‑Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk‑free interest rates, and, for grants prior to our initial public offering, the value of the common stock. For restricted stock awards, the grant date fair value is determined by the closing market price of our common stock on the date of grant. For awards subject to time‑based vesting, we recognize stock‑based compensation expense, on a straight‑line basis over the requisite service period, which is generally the vesting term of the award. For awards subject to performance‑based vesting conditions, we recognize stock‑based compensation expense when it is probable that the performance condition will be achieved. Clinical Trial Expenses As part of the process of preparing our financial statements, we are required to estimate our expenses resulting from our obligations under contracts with vendors, clinical research organizations and consultants and under clinical site agreements in connection with conducting clinical trials. The financial terms of these contracts are subject to negotiations, which vary from contract to contract and may result in payment flows that do not match the periods over which materials or services are provided under such contracts. Our objective is to reflect the appropriate trial expenses in our financial statements by matching those expenses with the period in which services are performed and efforts are expended. We account for these expenses according to the progress of the trial as measured by patient progression and the timing of various aspects of the trial. We determine accrual estimates based on estimates of services received and efforts expended that take into account discussion with applicable personnel and outside service providers as to the progress or state of consummation of trials. During the course of a clinical trial, we adjust our clinical expense recognition if actual results differ from its estimates. We make estimates of our accrued expenses as of each balance sheet date based on the facts and circumstances known at that time. Our clinical trial accruals are dependent upon the timely and accurate reporting of contract research organizations and other third‑party vendors. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in reporting amounts that are too high or too low for any particular period. For the years ended December 31, 2019 and 2018 there were no material adjustments to our prior period estimates of accrued expenses for clinical trials. Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) established Accounting Standards Codification (ASC) Topic 842, Leases (ASC 842) , by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. ASC 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842 ; ASU No. 2018-10, Codification Improvements to Topic 842, Leases ; and ASU No. 2018-11, Targeted Improvements . The new standard establishes a right-of-use model that requires a lessee to recognize a right-of-use (ROU) asset and lease liability on the balance sheet for all leases with a term longer than 12 months , and l eases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. We adopted ASC 842 in the first quarter of 2019 utilizing the modified retrospective transition method on the effective date. Consequently, financial information has not been updated and the disclosures required under the new standard have not been provided for dates and periods before January 1, 2019. Upon adoption, we elected the package of practical expedients, which permitted us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. We did not elect the use-of-hindsight practical expedient nor the practical expedient pertaining to land easements, the latter not being applicable to us . The adoption of ASC 842 on January 1, 2019 resulted in the recognition of right-of-use assets of $2.5 million and lease liabilities for operating leases of $3.4 million on our consolidated balance sheets, with no material impact to our consolidated statements of operations, cash flows or stockholders’ equity. The operating lease liabilities were determined based on the present value of the remaining minimum rental payments and the operating lease asset was determined based on the value of the lease liability, adjusted for the lease incentive of $0.9 million. See Note 6 for further information regarding the impact of the adoption of ASC 842 on our consolidated financial statements.

Fair Value Measurements

Fair Value Measurements	12 Months Ended
	Dec. 31, 2019
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 December 31, 2019 or 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 December 31, 2019 Assets Money market funds (cash equivalents) $ 85,395 $ — $ — $ 85,395 Certificates of deposit 739 — — 739 Total assets $ 86,134 $ — $ — $ 86,134 December 31, 2018 Assets Money market funds (cash equivalents) $ 14,049 $ — $ — $ 14,049 U.S. Treasury securities — 4,998 — 4,998 Total assets $ 14,049 $ 4,998 $ — $ 19,047

Property and Equipment

Property and Equipment	12 Months Ended
	Dec. 31, 2019
Property and Equipment
Property and Equipment	4. Property and Equipment Property and equipment consisted of the following (in thousands): December 31, December 31, 2019 2018 Laboratory equipment $ 1,777 $ 1,756 Leasehold improvements 899 — Office furniture and equipment 401 148 Total property and equipment 3,077 1,904 Less: accumulated depreciation (812) (610) Total property and equipment, net $ 2,265 $ 1,294 Depreciation expense was $0.2 million and $0.1 million for the years ended December 31, 2019 and 2018, respectively.

Accrued Expenses

Accrued Expenses	12 Months Ended
	Dec. 31, 2019
Accrued Expenses
Accrued Expenses	5. Accrued Expenses Accrued expenses consisted of the following (in thousands): December 31, 2019 2018 Payroll and related costs $ 2,514 $ 1,364 Clinical trials and drug development 1,849 2,781 Professional fees 396 204 Short-term lease liabilities 446 — Other 63 88 Total accrued expenses $ 5,268 $ 4,437

Leases

Leases	12 Months Ended
	Dec. 31, 2019
Leases
Leases	6. Leases As discussed in Note 2, we adopted ASC 842 as of January 1, 2019. We have entered into operating leases for real estate. These leases have terms which range from 36 to 78 months, and include renewal terms which can extend the lease terms by 24 to 60 months, which are included in the lease term when it is reasonably certain that we will exercise the option. As of December 31, 2019, our operating leases had a weighted average remaining lease term of 68 months. These ROU assets are included in "Other assets" on our consolidated balance sheet as of December 31, 2019, and represent our right to use the underlying asset for the lease term. Our obligations to make lease payments are included in "Accrued expenses" and "Other long-term liabilities" on our consolidated balance sheet as of December 31, 2019. The ROU assets are initially measured at cost, which comprises the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date, plus any initial direct costs incurred, less any lease incentives received. The ROU assets are subsequently measured throughout the lease term at the carrying amount of the lease liability, plus initial direct costs, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received. Our ROU assets as of January 1, 2019 have been adjusted for $0.9 million in lease incentives. Based on the present value of the lease payments for the remaining lease term of our existing leases, we initially recognized ROU assets of $2.5 million and lease liabilities for operating leases of $3.4 million during the first quarter of 2019. Operating lease right-of-use assets and liabilities commencing after January 1, 2019 are recognized at commencement date based on the present value of lease payments over the lease term. As of December 31, 2019, ROU assets and operating lease liabilities were $2.2 million and $3.5 million, respectively. We have entered into various short-term operating leases, primarily for clinical trial equipment, with an initial term of twelve months or less. These leases are not recorded on our consolidated balance sheets. All operating lease expense is recognized on a straight-line basis over the lease term. During the year ended December 31, 2019, we recognized $0.7 million in total lease costs, which included less than $0.1 million in short-term lease costs related to short-term operating leases. Because the rate implicit in each lease is not readily determinable, we use our incremental borrowing rate to determine the present value of the lease payments. The weighted average incremental borrowing rate used to determine the initial value of ROU assets and lease liabilities was 11.0%, derived from a corporate yield curve based on a synthetic credit rating model using a market signal analysis. We have certain contracts for real estate which may contain lease and non-lease components which we have elected to treat as a single lease component. ROU assets for operating leases are periodically reduced by impairment losses. We use the long-lived assets impairment guidance in ASC Subtopic 360-10, Property, Plant, and Equipment – Overall, to determine whether an ROU asset is impaired, and if so, the amount of the impairment loss to recognize. As of December 31, 2019, we have not recognized any impairment losses for our ROU assets. We monitor for events or changes in circumstances that require a reassessment of one of our leases. When a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in profit or loss. Maturities of operating lease liabilities as of December 31, 2019 were as follows (in thousands): 2020 $ 807 2021 818 2022 807 2023 823 2024 840 Thereafter 642 4,737 Less: imputed interest (1,248) Total lease liabilities $ 3,489 Current operating lease liabilities $ 446 Non-current operating lease liabilities 3,043 Total lease liabilities $ 3,489 Rental expense for the year ended December 31, 2018, prior to the adoption of ASC 842 as described in Note 2, was $0.2 million. Annual future minimum lease payments as of December 31, 2018, prior to the adoption of ASC 842 as described in Note 2, were as follows (in thousands): 2019 $ 298 2020 807 2021 819 2022 807 2023 823 Thereafter 1,482 Total minimum lease payments 5,036

Investments

Investments	12 Months Ended
	Dec. 31, 2019
Investments
Investments	7. Investments As of December 31, 2019, our investments consisted of certificates of deposit with various financial institutions with original maturities of six to nine months. Investments are classified as short- or long-term investments on our consolidated balance sheets based on original maturity. Certificates of deposits were classified as held-to-maturity and were recorded at amortized cost, which approximated fair value. As of December 31, 2018, our investments consisted of U.S. Treasury securities, maturing at various dates through January 2019. Investments are classified as short- or long-term investments on our consolidated balance sheets based on maturity. U.S. Treasury securities are classified as available-for-sale and are recorded at amortized cost. As of December 31, 2018, our one U.S. Treasury security was in an unrealized loss position. While this security has been in an unrealized loss position for more than 12 months, the security matured in January 2019 and we recovered the full amortized cost basis. Accordingly, we believe that there was no other-than-temporary impairment as of December 31, 2018. Total amortized cost and fair value each were $5.0 million as of December 31, 2018, with an unrealized loss of $1 thousand.

Stockholders' Equity

Stockholders' Equity	12 Months Ended
	Dec. 31, 2019
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 December 31, 2019, 330,450 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. The amount, terms of grants, and exercisability provisions are determined and set by our board of directors. Effective August 2014, we adopted our 2014 Equity Incentive Plan, as amended (2014 Plan) that authorizes us to grant options, restricted stock, and other equity-based awards, subject to adjustment in accordance with the 2014 Plan. As of December 31, 2019, 7,121,331 options to purchase shares of common stock and 32,400 restricted shares of common stock were outstanding pursuant to grants in connection with the 2014 Plan, and 663,460 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. In accordance with the 2014 Plan, on January 1, 2019, the shares of common stock available for future grants under the 2014 Plan was increased to 5,082,305. In addition, during the years ended December 31, 2019 and 2018, we granted 920,000 and 311,000 options, respectively, to purchase shares of common stock outside of our 2014 Plan as inducement grants material to new employees entering into employment agreements with us pursuant to Nasdaq Listing Rule 5635(c)(4). The amount, terms of grants, and exercisability provisions of these grants are determined and set by our board of directors, and are largely consistent with the terms and exercisability provisions of grants under our 2014 Plan. Stock Options Total compensation cost recognized for all stock option awards in the statements of operations is as follows (in thousands): Year Ended December 31, 2019 2018 Research and development $ 2,563 $ 1,712 General and administrative 3,070 2,995 Total $ 5,633 $ 4,707 Options issued under both the 2005 Plan and 2014 Plan and the inducement grants have a contractual life of up to 10 years and may be exercisable in cash or as otherwise determined by the board of directors. Vesting generally occurs over a period of not greater than four years. A summary of activity for the years ended December 31, 2019 and 2018 is presented below (in thousand, except share and per share amounts): Weighted‑ Average Aggregate Exercise Price Intrinsic Shares Per Share Value Outstanding—December 31, 2017 3,754,320 $ 5.22 Granted 1,372,000 6.60 Exercised (12,308) 1.18 Forfeited (162,603) 5.00 Outstanding—December 31, 2018 4,951,409 5.62 Granted 4,703,000 2.31 Exercised (80,020) 1.22 Forfeited (916,205) 4.21 Expired (117,903) 8.23 Outstanding—December 31, 2019 8,540,281 $ 3.95 $ 3,774 Exercisable—December 31, 2019 4,431,560 $ 5.04 $ 1,447 Exercisable and expected to vest—December 31, 2019 8,540,281 $ 3.95 $ 3,774 The weighted average remaining contractual term of options outstanding and exercisable as of December 31, 2019 is 8.1 years and 7.1 years, respectively. Intrinsic value in the table above was determined by calculating the difference between the market value of our common stock on the last trading day of 2019 of $2.16 per share and the exercise price, multiplied by the number of in-the-money options. The weighted‑average grant date fair value of options granted was $1.90 and $5.51 per share in 2019 and 2018, respectively, and was estimated at the date of grant using the Black‑Scholes option‑pricing model with the following ranges of weighted‑average assumptions: 2019 2018 Expected stock price volatility - % - % Expected term of options - years - years Risk‑free interest rate - % - % Expected annual dividend yield % % The weighted‑average valuation assumptions were determined as follows: · Expected stock price volatility: The expected volatility is based on historical volatility of our stock price. · Expected term of options: We estimated the expected term of our stock options with service‑based vesting using the “simplified” method, as prescribed in SAB No. 107, whereby the expected life equals the average of the vesting tranches and the original contractual term of the option due to our lack of sufficient historical data. · Risk‑free interest rate: We base the risk‑free interest rate on the interest rate payable on U.S. Treasury securities in effect at the time of grant for a period that is commensurate with the assumed expected option term. · Expected annual dividend yield: The estimated annual dividend yield is 0% because we have not historically paid, and do not expect for the foreseeable future to pay, a dividend on our common stock. As of December 31, 2019, there was $8.3 million of total unrecognized compensation expense related to unvested stock options. That expense is expected to be recognized over the next four years as follows, in thousands: 2020 $ 3,981 2021 2,941 2022 1,065 2023 304 $ 8,291 Restricted Stock All issued and outstanding restricted shares of common stock are time-based and become vested one year after the grant date, pursuant to the 2014 Plan. 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 the Company’s common stock on the date of the grant. No restricted shares of common stock were issued during 2019 or 2018. A summary of activity for the years ended December 31, 2019 and 2018 is presented below: Weighted‑average Grant Date Shares Fair Value per Share Outstanding—December 31, 2017 239,800 $ 1.21 Vested (120,600) 1.21 Forfeited (14,000) 1.21 Outstanding—December 31, 2018 105,200 1.21 Vested (52,600) 1.21 Forfeited (20,200) 1.21 Outstanding—December 31, 2019 32,400 $ 1.21 Expected to vest—December 31, 2019 32,400 $ 1.21 As of December 31, 2019, there was no unrecognized compensation cost related to unvested restricted stock. Total compensation cost recognized for all restricted stock awards in the statements of operations for the years ended December 31, 2019 and 2018 is as follows (in thousands): Year Ended December 31, 2019 2018 Research and development $ 19 $ 19 General and administrative 20 62 Total $ 39 $ 81 Equity Distribution Agreement In October 2017, we entered into an Equity Distribution Agreement (EDA) with JMP Securities LLC (JMP), under which JMP, as our exclusive agent, at our discretion and at such times that we may determine from time to time, may sell over a three-year period from the execution of the agreement up to a maximum of $50 million of shares of our common stock The EDA will terminate upon the earliest of: (1) the sale of all shares subject to the EDA, (2) October 31, 2020 or (3) the termination of the EDA in accordance with its terms. Either party may terminate the EDA at any time upon written notification to the other party in accordance with the EDA, and upon such notification, the offering will terminate. We agreed to pay JMP a commission of up to 3.0% of the gross sales price of any shares sold pursuant to the EDA. With the exception of commissions related to sale of the shares, JMP will be responsible for all of its own costs and expenses incurred in connection with the offering. During the year ended December 31, 2019, we issued 1,692,289 shares of our common stock pursuant to the EDA for aggregate net proceeds to us of $2.1 million. As of December 31, 2019, $34.8 million remained available under the EDA. We did not issue any shares pursuant to the EDA during the year ended December 31, 2018. Public Offering On December 11, 2019, the Company entered into an underwriting agreement with Oppenheimer & Co., Inc., as representative of the underwriters (the “Underwriting Agreement”), in connection with the underwritten public offering of 28,000,000 shares of the Company’s common stock, par value $0.001 per share, at a price to the public of $1.25 per share (the “Public Offering”). Pursuant to the terms of the Underwriting Agreement, on December 13, 2019, the Company sold 32,200,000 shares of common stock, including the exercise of the option granted to the underwriters for 4,200,000 shares of common stock, and received net proceeds of $37.4 million, after deducting underwriting discounts and commissions and other transaction costs of $2.8 million.

Convertible Preferred Stock

Convertible Preferred Stock	12 Months Ended
	Dec. 31, 2019
Convertible Prefererd Stock
Convertible Prefererd Stock	9. Convertible Preferred Stock Concurrent with the Public Offering, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”), by and among the Company and the Investors listed therein. Pursuant to the terms of the Purchase Agreement, the Company sold to the Investors an aggregate of 30,000 shares of Series A Participating Convertible Preferred Stock, par value $0.001 per share (the “Series A Preferred Stock”), at a per share price of $1,000 in a private placement (the “Private Placement”), and received net proceeds of $28.2 million, after deducting underwriting discounts and commissions of $1.8 million. Each share of Series A Preferred Stock will be convertible into 800 shares of common stock reflecting a conversion price equal to $1.25 per share, subject to customary anti-dilution adjustments. The shares of Series A Preferred Stock will be mandatorily convertible into shares of common stock, subject to a beneficial ownership limitation (described below), in partial or in full, thereof from and after filing the certificate of amendment to the Company’s charter with the Secretary of State of the State of Delaware to increase the Company’s authorized shares of common stock (Exercise Contingency). The holders of the Series A Preferred Stock have a feature that allows the holders to have a liquidation preference to the Company’s common stockholders. Because such a potential redemption-triggering event is not solely within the control of the Company, the preferred stock is presented as "Convertible Preferred Stock" on our balance sheet in a manner consistent with temporary equity under applicable accounting standards. The holders of the Series A Preferred Stock also have the right to receive discretionary dividends paid to common shareholders. Except as required by law, the Series A Preferred Stock is non-voting stock. The holders each have a beneficial ownership limitation of 9.99% of total outstanding shares of common stock, including an option for the holder to increase this percentage to 19.99%. The Preferred Shares sold in the Private Placement have not been registered under the Securities Act. The Company has agreed to file a resale registration statement with the Securities and Exchange Commission after satisfaction of the Exercise Contingency for purposes of registering the resale of the shares of common stock issuable upon conversion of the Series A Preferred Stock. The Company is permitted to issue unregistered shares of common stock upon the conversion of the Series A Preferred Stock if the registration statement is not effective. In the event the Company is unable to register the issuable shares of common stock, the Company would be liable for a penalty to the holders, in an aggregate amount not to exceed 4% of gross proceeds. The difference between the conversion price and the fair value of the Company’s common stock on the commitment date (transaction date) resulted in a beneficial conversion feature the amount of $8.9 million. This amount will be recognized as a deemed dividend on the date in which the Exercise Contingency is resolved.

Commitments and Contingencies

Commitments and Contingencies	12 Months Ended
	Dec. 31, 2019
Commitments and Contingencies
Commitments and Contingencies	10. Commitments and Contingencies Employee Benefit Plan We maintain a Section 401(k) retirement plan for all employees. Employees can contribute up to 50% of their eligible pay, subject to maximum amounts allowed under law. We may make discretionary profit sharing contributions, which vest over a period of four years from each employee’s commencement of employment with us. We have not made any discretionary contributions. License Agreements We are obligated to pay royalties pursuant to a license agreement with Purdue Neuroscience Company (Purdue) as a percentage of net product sales for direct licensed products, such as ganaxolone. The obligation to pay royalties expires, on a country‑by‑country basis, 10 years from the first commercial sale of a licensed product in each country. The agreement also requires that we pay Purdue a percentage of the non‑royalty consideration that we receive from a sublicensee and a percentage of milestone payments for indications other than seizure disorders and vascular migraine headaches not associated with mood disorders. Under the license agreement, we are committed to use commercially reasonable efforts to develop and commercialize at least one licensed product. 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 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. As of December 31, 2019, we have not met any additional milestones under the License Agreement and have not made any additional payments to CyDex other than the upfront fee. 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. Severance Arrangements In March 2019, we entered into a Severance Agreement and General Release (Severance Agreement) with Christopher M. Cashman (Cashman), our former Chief Executive Officer. In connection with this Severance Agreement, we agreed to pay certain severance benefits for one year to Cashman, including salary and benefits continuation and a prorated bonus totaling $0.6 million. As of December 31, 2019, $0.1 million in severance benefits remained unpaid. In addition, certain of Cashman’s outstanding stock option agreements were modified to accelerate vesting and extend the exercise period, resulting in additional compensation cost of $0.4 million. Employment Agreements In August 2019, we entered into an amended and restated employment agreement with Scott Braunstein, M.D., Chief Executive Officer (the “Employment Agreement”). Under the Employment Agreement, Dr. Braunstein will be paid an annual base salary of $537,500 and will be eligible to receive a bonus of up to 50% of his base salary, as determined by the Board in its discretion, prorated for 2019. In October 2019, we entered into an Employment Agreement with Joe Hulihan, M.D., Chief Medical Officer. Under his Employment Agreement, Dr. Hulihan will be paid an annual base salary of $375,000 and will be eligible to receive a bonus of up to 35% of his base salary, as determined by the Board in its discretion, prorated for 2019.

Income Taxes

Income Taxes	12 Months Ended
	Dec. 31, 2019
Income Taxes
Income Taxes	11. Income Taxes The Tax Cuts and Jobs Act (the "TCJA") was enacted on December 22, 2017 and became effective January 1, 2018. The TCJA had significant changes to U.S. tax law, lowering U.S. corporate income tax rates, implementing a territorial tax system, imposing a one-time transition tax on deemed repatriated earnings of foreign subsidiaries and modified the taxation of other income and expense items. The TCJA reduced the U.S. corporate income tax rate from 34% to 21%, effective January 1, 2018. Loss before income taxes is allocated as follows (in thousands): Year Ended December 31, 2019 2018 U.S. operations $ 18,544 $ 7,855 Foreign operations 35,577 28,871 Loss before income taxes $ 54,121 $ 36,726 As of December 31, 2019 and 2018, we had approximately $143.7 million and $131.6 million, respectively, of net operating loss (NOL) carry forwards available to offset future federal and state taxable income that will expire beginning in 2023. We also have federal research and development credit carryovers of approximately $8.4 million and state credit carryovers of approximately $0.4 million, which expire beginning in 2020. The NOL carry forwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. NOL and tax credit carry forwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant stockholders over a three‑year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, or the Code, as well as similar state tax provisions. This could limit the amount of NOLs that we can utilize annually to offset future taxable income or tax liabilities. The amount of the annual limitation, if any, will be determined based on the value of our company immediately prior to an ownership change. Subsequent ownership changes may further affect the limitation in future years. In addition, U.S. tax laws limit the time during which these carry forwards may be applied against future taxes, therefore, we may not be able to take full advantage of these carry forwards for federal income tax purposes. We have not evaluated the ownership history of our company to determine if there were any ownership changes as defined under Section 382(g) of the Code and the effects any ownership change may have had. The components of the net deferred tax asset are as follows (in thousands): December 31, 2019 2018 Gross deferred tax assets: Net operating loss carryforwards $ 40,120 $ 36,383 Accrued expenses 200 52 Contributions 4 3 Depreciation 42 — Stock‑based compensation 2,967 1,640 Research and development and other credits 9,118 6,545 Total gross deferred tax assets $ 52,451 $ 44,623 Gross deferred tax liabilities: Depreciation — (18) Total gross deferred tax liabilities — (18) Net deferred tax assets 52,451 44,605 Less: valuation allowance (52,451) (44,605) Net deferred tax assets after valuation allowance $ — $ — In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on consideration of these items, management has determined that enough uncertainty exists relative to the realization of the deferred income tax asset balances to warrant the application of a full valuation allowance as of December 31, 2019 and 2018. The valuation allowance increased by $7.8 million and $2.0 million during the years ended December 31, 2019 and 2018, respectively. The increase in both years was due primarily to our increase in net operating loss carryovers. We did not have unrecognized tax benefits as of December 31, 2019 and 2018, and do not expect this to change significantly over the next twelve months. We recognize tax positions in the financial statements only when it is more likely than not that the position will be sustained on examination by the relevant taxing authority based on the technical merits of the position. A position that meets this standard is measured at the largest amount of benefit that will more likely than not be realized on settlement. A liability is established for differences between positions taken in a tax return and amounts recognized in the financial statements. Accrued interest and penalties, where appropriate, are recorded in income tax expense. We did not have uncertain tax positions as of December 31, 2019 and 2018. As of December 31, 2019 and 2018, we have not accrued interest or penalties related to any uncertain tax positions. A reconciliation of income tax expense (benefit) at the statutory federal income tax rate and income taxes as reflected in the financial statements is as follows: Year Ended December 31, 2019 2018 Federal income tax expense at statutory rate 21.0 % 21.0 % Permanent items (1.0) (0.9) State income tax, net of federal benefit 2.3 0.1 R&D tax credits 4.4 4.3 Change in state apportionment 1.1 (1.1) Foreign income tax effect (13.8) (16.5) Other 0.5 (1.6) Change in valuation allowance (14.5) (5.3) Effective income tax rate % % For all years through December 31, 2019, we generated research and development credits but have not conducted a study to document the qualified activities. This study may result in an adjustment to our research and development credit carryforwards; however, until a study is completed and any adjustment is known, no amounts are being presented as an uncertain tax position for these years. A full valuation allowance has been provided against our research and development credits and, if an adjustment is required, this adjustment to the deferred tax asset established for the research and development credit carryforwards would be offset by an adjustment to the valuation allowance. We file income tax returns in the United States, the State of Connecticut, and the Commonwealth of Pennsylvania. The federal and state income tax returns are generally subject to tax examinations for the tax years ended December 31, 2016 through December 31, 2018. To the extent we have tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service or state tax authorities to the extent utilized in a future period.

Quarterly Financial Information

Quarterly Financial Information (unaudited)	12 Months Ended
	Dec. 31, 2019
Quarterly Financial Information (unaudited)
Quarterly Financial Information (unaudited)	12. Quarterly Financial Information (unaudited) First Quarter Second Quarter Third Quarter Fourth Quarter Total Year 2019 Research and development expenses $ 8,872 $ 10,010 $ 11,572 $ 12,512 $ 42,966 General and administrative expenses $ 3,667 $ 2,502 $ 2,327 $ 2,960 $ 11,456 Net loss $ (12,483) $ (12,423) $ (13,806) $ (15,409) $ (54,121) Net loss per common share, basic and diluted $ (0.24) $ (0.24) $ (0.26) $ $ (0.99) 2018 Research and development expenses $ 3,927 $ 7,232 $ 9,148 $ 8,087 $ 28,394 General and administrative expenses $ 2,187 $ 2,338 $ 2,073 $ 2,187 $ 8,785 Net loss $ (5,999) $ (9,504) $ (11,110) $ (10,113) $ (36,726) Net loss per common share, basic and diluted $ (0.15) $ (0.24) $ (0.27) $ $

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2019
Summary of Significant Accounting Policies
Principles of Consolidation	Principles of Consolidation The consolidated financial statements include the accounts of Marinus Pharmaceuticals, Inc. (the Company) and its wholly-owned subsidiary. All intercompany accounts and transactions have been eliminated.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles (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 revenues and expenses during the reporting period. Actual results could differ from such estimates.
Fair Value of Financial Instruments and Credit Risk	Fair Value of Financial Instruments and Credit Risk At December 31, 2019 and 2018, our financial instruments included cash equivalents, short-term investments, accounts payable and accrued expenses. The carrying amount of cash equivalents, accounts payable and accrued expenses approximated fair value, given their short-term nature. The carrying amounts of short-term investments are recorded at amortized cost, which for U.S. Treasury securities is based on the current market price of each security at the measurement date. Cash equivalents and certificates of deposit subject us to concentrations of credit risk. However, we invest our cash in accordance with a policy objective that seeks to ensure both liquidity and safety of principal. The policy limits investments to instruments issued by the U.S. government, certain Securities and Exchange Commission (SEC)-registered money market funds that invest only in U.S. government obligations and various other low-risk liquid investment options, and places restrictions on portfolio maturity terms.
Cash and Cash Equivalents	Cash and Cash Equivalents We consider all highly liquid investments that have maturities of three months or less when acquired to be cash equivalents. As of December 31, 2019 and 2018, we invested a portion of our cash balances in money market investments, which we have included as cash equivalents on our balance sheets.
Investments	Investments As of December 31, 2019, our investments consisted of certificates of deposit with various financial institutions, with original maturities ranging from six to nine months. All investments were classified as held-to-maturity and were recorded at amortized cost. As of December 31, 2018, our investments consisted of U.S. Treasury securities and are classified as available-for-sale and are recorded at amortized cost with unrealized gains and losses recorded in accumulated other comprehensive loss, as a separate component of stockholders’ equity. Interest income includes interest and dividends, realized gains and losses on sales of securities and other-than-temporary impairment (OTTI) declines in the fair value of securities, if any. U.S. Treasury securities with maturities less than 12 months are classified as short-term investments and maturities greater than 12 months are classified as long-term investments on our balance sheets. The Company reviews its available-for-sale securities for OTTI declines in fair value below its cost basis each quarter and whenever events or changes in circumstances indicate that the cost basis of an asset may not be recoverable. This evaluation is based on a number of factors, including the length of time and the extent to which the fair value has been below its cost basis and adverse conditions related specifically to the security, including any changes to the credit rating of the security, and the intent to sell, or whether the Company will more likely than not be required to sell, the security before recovery of its amortized cost basis. The Company’s assessment of whether a security is other-than-temporarily impaired could change in the future due to new developments or changes in assumptions related to any particular security. If a decline in the fair value of an available-for-sale security in the Company’s investment portfolio is deemed to be other-than-temporary, the Company writes down the security to its current fair value. If the Company intends to sell the security or it is more likely than not that the Company will be forced to sell the security before recovery of the amortized cost of the security, the loss is recognized in net income. Otherwise, the loss is separated into a portion representing a credit loss, which is recorded in net income, and the remainder is recorded in other comprehensive income, net of taxes.
Prepaid Expenses and Other Current Assets	Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets generally represent payments made for goods or services to be received within one year, and are expensed as the related benefit is received.
Property and Equipment	Property and Equipment Property and equipment consist of laboratory and office equipment and are recorded at cost. Property and equipment are depreciated on a straight‑line basis over their estimated useful lives. We estimate a life of three years for computer equipment, including software, five years for office equipment and furniture, five to fifteen years for laboratory equipment, and six years for leasehold improvements. When property and equipment are sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is included in operating expenses.
Impairment of Long-Lived Assets	Impairment of Long‑Lived Assets We review long‑lived assets, including property and equipment, for impairment whenever events or changes in business circumstances indicate that the carrying amount of an asset may not be fully recoverable. If the estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount an impairment loss would be recognized if the carrying value of the asset exceeded its fair value. Fair value is generally determined using discounted cash flows.
Research and Development	Research and Development Research and development costs are expensed as incurred. Costs for certain development activities, such as clinical trials, are recognized based on an evaluation of the progress to completion of specific tasks using data such as subject enrollment, monitoring visits, clinical site activations, or information provided to us by our vendors with respect to their actual costs incurred. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected in the financial statements as prepaid or accrued research and development expense, as the case may be.
Income Taxes	Income Taxes We recognize deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of our assets and liabilities and the expected benefits of net operating loss carryforwards. The impact of changes in tax rates and laws on deferred taxes, if any, applied during the years in which temporary differences are expected to be settled, is reflected in the financial statements in the period of enactment. The measurement of deferred tax assets is reduced, if necessary, if, based on weight of the evidence, it is more likely than not that some, or all, of the deferred tax assets will not be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that such tax rate changes are enacted. At December 31, 2019 and 2018, we have concluded that a full valuation allowance is necessary for our net deferred tax assets. We had no material amounts recorded for uncertain tax positions, interest or penalties in the accompanying financial statements.
Loss Per Share of Common Stock	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. The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2019 and 2018 (in thousands, except share and per share amounts): Year Ended December 31, 2019 2018 Basic and diluted net loss per share of common stock: Net loss $ (54,121) $ (36,726) Weighted average shares of common stock outstanding 54,512,778 40,895,406 Net loss per share of common stock—basic and diluted $ (0.99) $ (0.90) The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding, as they would be antidilutive: December 31, 2019 2018 Convertible preferred stock 24,000,000 — Restricted stock 32,400 105,200 Stock options 8,540,281 4,951,409 32,572,681 5,056,609 The convertible preferred stock meets the definition of a participating security, however the holders are not obligated to share in our losses. As of December 31, 2019 and 2018, we had no other potentially dilutive securities.
Comprehensive Loss	Comprehensive Loss Comprehensive loss is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non‑owner sources. As of December 31, 2018, comprehensive loss includes net loss and unrealized gain or loss on available-for-sale securities.
Segment Information	Segment Information Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision‑making group, in deciding how to allocate resources and in assessing performance. We view our operations and manage our business in one segment, which is the identification and development of innovative therapeutics to treat rare seizure disorders.
Stock-Based Compensation	Stock‑Based Compensation We account for stock‑based compensation in accordance with the provisions of Accounting Standards Codification (ASC) Topic 718, Compensation—Stock Compensation , or ASC 718, which requires the recognition of expense related to the fair value of stock‑based awards in the statements of operations. For stock options issued to employees, non-employees and members of our board of directors for their services on our board of directors, we estimate the grant‑date fair value of options using the Black‑Scholes option pricing model. The use of the Black‑Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk‑free interest rates, and, for grants prior to our initial public offering, the value of the common stock. For restricted stock awards, the grant date fair value is determined by the closing market price of our common stock on the date of grant. For awards subject to time‑based vesting, we recognize stock‑based compensation expense, on a straight‑line basis over the requisite service period, which is generally the vesting term of the award. For awards subject to performance‑based vesting conditions, we recognize stock‑based compensation expense when it is probable that the performance condition will be achieved.
Clinical Trial Expenses	Clinical Trial Expenses As part of the process of preparing our financial statements, we are required to estimate our expenses resulting from our obligations under contracts with vendors, clinical research organizations and consultants and under clinical site agreements in connection with conducting clinical trials. The financial terms of these contracts are subject to negotiations, which vary from contract to contract and may result in payment flows that do not match the periods over which materials or services are provided under such contracts. Our objective is to reflect the appropriate trial expenses in our financial statements by matching those expenses with the period in which services are performed and efforts are expended. We account for these expenses according to the progress of the trial as measured by patient progression and the timing of various aspects of the trial. We determine accrual estimates based on estimates of services received and efforts expended that take into account discussion with applicable personnel and outside service providers as to the progress or state of consummation of trials. During the course of a clinical trial, we adjust our clinical expense recognition if actual results differ from its estimates. We make estimates of our accrued expenses as of each balance sheet date based on the facts and circumstances known at that time. Our clinical trial accruals are dependent upon the timely and accurate reporting of contract research organizations and other third‑party vendors. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in reporting amounts that are too high or too low for any particular period. For the years ended December 31, 2019 and 2018 there were no material adjustments to our prior period estimates of accrued expenses for clinical trials.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) established Accounting Standards Codification (ASC) Topic 842, Leases (ASC 842) , by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. ASC 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842 ; ASU No. 2018-10, Codification Improvements to Topic 842, Leases ; and ASU No. 2018-11, Targeted Improvements . The new standard establishes a right-of-use model that requires a lessee to recognize a right-of-use (ROU) asset and lease liability on the balance sheet for all leases with a term longer than 12 months , and l eases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. We adopted ASC 842 in the first quarter of 2019 utilizing the modified retrospective transition method on the effective date. Consequently, financial information has not been updated and the disclosures required under the new standard have not been provided for dates and periods before January 1, 2019. Upon adoption, we elected the package of practical expedients, which permitted us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. We did not elect the use-of-hindsight practical expedient nor the practical expedient pertaining to land easements, the latter not being applicable to us . The adoption of ASC 842 on January 1, 2019 resulted in the recognition of right-of-use assets of $2.5 million and lease liabilities for operating leases of $3.4 million on our consolidated balance sheets, with no material impact to our consolidated statements of operations, cash flows or stockholders’ equity. The operating lease liabilities were determined based on the present value of the remaining minimum rental payments and the operating lease asset was determined based on the value of the lease liability, adjusted for the lease incentive of $0.9 million. See Note 6 for further information regarding the impact of the adoption of ASC 842 on our consolidated financial statements.

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Dec. 31, 2019
Summary of Significant Accounting Policies
Schedule of computation of basic and diluted earnings per share	The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2019 and 2018 (in thousands, except share and per share amounts): Year Ended December 31, 2019 2018 Basic and diluted net loss per share of common stock: Net loss $ (54,121) $ (36,726) Weighted average shares of common stock outstanding 54,512,778 40,895,406 Net loss per share of common stock—basic and diluted $ (0.99) $ (0.90)
Schedule of antidilutive securities excluded from the computation of diluted weighted average shares outstanding	December 31, 2019 2018 Convertible preferred stock 24,000,000 — Restricted stock 32,400 105,200 Stock options 8,540,281 4,951,409 32,572,681 5,056,609

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	12 Months Ended
	Dec. 31, 2019
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 December 31, 2019 Assets Money market funds (cash equivalents) $ 85,395 $ — $ — $ 85,395 Certificates of deposit 739 — — 739 Total assets $ 86,134 $ — $ — $ 86,134 December 31, 2018 Assets Money market funds (cash equivalents) $ 14,049 $ — $ — $ 14,049 U.S. Treasury securities — 4,998 — 4,998 Total assets $ 14,049 $ 4,998 $ — $ 19,047

Property and Equipment (Tables)

Property and Equipment (Tables)	12 Months Ended
	Dec. 31, 2019
Property and Equipment
Schedule of property and equipment	Property and equipment consisted of the following (in thousands): December 31, December 31, 2019 2018 Laboratory equipment $ 1,777 $ 1,756 Leasehold improvements 899 — Office furniture and equipment 401 148 Total property and equipment 3,077 1,904 Less: accumulated depreciation (812) (610) Total property and equipment, net $ 2,265 $ 1,294

Accrued Expenses (Tables)

Accrued Expenses (Tables)	12 Months Ended
	Dec. 31, 2019
Accrued Expenses
Schedule of accrued expenses	Accrued expenses consisted of the following (in thousands): December 31, 2019 2018 Payroll and related costs $ 2,514 $ 1,364 Clinical trials and drug development 1,849 2,781 Professional fees 396 204 Short-term lease liabilities 446 — Other 63 88 Total accrued expenses $ 5,268 $ 4,437

Leases (Tables)

Leases (Tables)	12 Months Ended
	Dec. 31, 2019
Leases
Schedule of maturities of operating lease liabilities	Maturities of operating lease liabilities as of December 31, 2019 were as follows (in thousands): 2020 $ 807 2021 818 2022 807 2023 823 2024 840 Thereafter 642 4,737 Less: imputed interest (1,248) Total lease liabilities $ 3,489 Current operating lease liabilities $ 446 Non-current operating lease liabilities 3,043 Total lease liabilities $ 3,489
Schedule of future minimum operating lease payments	Annual future minimum lease payments as of December 31, 2018, prior to the adoption of ASC 842 as described in Note 2, were as follows (in thousands): 2019 $ 298 2020 807 2021 819 2022 807 2023 823 Thereafter 1,482 Total minimum lease payments 5,036

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)	12 Months Ended
	Dec. 31, 2019
Schedule of weighted-average assumptions estimated at the date of grant using the Black-Scholes option pricing model	2019 2018 Expected stock price volatility - % - % Expected term of options - years - years Risk‑free interest rate - % - % Expected annual dividend yield % %
Schedule of unrecognized compensation expense expected to be recognized in future years	That expense is expected to be recognized over the next four years as follows, in thousands: 2020 $ 3,981 2021 2,941 2022 1,065 2023 304 $ 8,291
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): Year Ended December 31, 2019 2018 Research and development $ 2,563 $ 1,712 General and administrative 3,070 2,995 Total $ 5,633 $ 4,707
Summary of activity for all options	A summary of activity for the years ended December 31, 2019 and 2018 is presented below (in thousand, except share and per share amounts): Weighted‑ Average Aggregate Exercise Price Intrinsic Shares Per Share Value Outstanding—December 31, 2017 3,754,320 $ 5.22 Granted 1,372,000 6.60 Exercised (12,308) 1.18 Forfeited (162,603) 5.00 Outstanding—December 31, 2018 4,951,409 5.62 Granted 4,703,000 2.31 Exercised (80,020) 1.22 Forfeited (916,205) 4.21 Expired (117,903) 8.23 Outstanding—December 31, 2019 8,540,281 $ 3.95 $ 3,774 Exercisable—December 31, 2019 4,431,560 $ 5.04 $ 1,447 Exercisable and expected to vest—December 31, 2019 8,540,281 $ 3.95 $ 3,774
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 for the years ended December 31, 2019 and 2018 is as follows (in thousands): Year Ended December 31, 2019 2018 Research and development $ 19 $ 19 General and administrative 20 62 Total $ 39 $ 81
Summary of activity for all restricted stock	A summary of activity for the years ended December 31, 2019 and 2018 is presented below: Weighted‑average Grant Date Shares Fair Value per Share Outstanding—December 31, 2017 239,800 $ 1.21 Vested (120,600) 1.21 Forfeited (14,000) 1.21 Outstanding—December 31, 2018 105,200 1.21 Vested (52,600) 1.21 Forfeited (20,200) 1.21 Outstanding—December 31, 2019 32,400 $ 1.21 Expected to vest—December 31, 2019 32,400 $ 1.21

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Dec. 31, 2019
Income Taxes
Summary of loss before income taxes	Loss before income taxes is allocated as follows (in thousands): Year Ended December 31, 2019 2018 U.S. operations $ 18,544 $ 7,855 Foreign operations 35,577 28,871 Loss before income taxes $ 54,121 $ 36,726
Schedule of components of the net deferred tax asset	The components of the net deferred tax asset are as follows (in thousands): December 31, 2019 2018 Gross deferred tax assets: Net operating loss carryforwards $ 40,120 $ 36,383 Accrued expenses 200 52 Contributions 4 3 Depreciation 42 — Stock‑based compensation 2,967 1,640 Research and development and other credits 9,118 6,545 Total gross deferred tax assets $ 52,451 $ 44,623 Gross deferred tax liabilities: Depreciation — (18) Total gross deferred tax liabilities — (18) Net deferred tax assets 52,451 44,605 Less: valuation allowance (52,451) (44,605) Net deferred tax assets after valuation allowance $ — $ —
Schedule of reconciliation of income tax expense (benefit) at the statutory federal income tax rate and income taxes	Year Ended December 31, 2019 2018 Federal income tax expense at statutory rate 21.0 % 21.0 % Permanent items (1.0) (0.9) State income tax, net of federal benefit 2.3 0.1 R&D tax credits 4.4 4.3 Change in state apportionment 1.1 (1.1) Foreign income tax effect (13.8) (16.5) Other 0.5 (1.6) Change in valuation allowance (14.5) (5.3) Effective income tax rate % %

Quarterly Financial Informati_2

Quarterly Financial Information (unaudited) (Tables)	12 Months Ended
	Dec. 31, 2019
Quarterly Financial Information (unaudited)
Schedule of quarterly financial information	First Quarter Second Quarter Third Quarter Fourth Quarter Total Year 2019 Research and development expenses $ 8,872 $ 10,010 $ 11,572 $ 12,512 $ 42,966 General and administrative expenses $ 3,667 $ 2,502 $ 2,327 $ 2,960 $ 11,456 Net loss $ (12,483) $ (12,423) $ (13,806) $ (15,409) $ (54,121) Net loss per common share, basic and diluted $ (0.24) $ (0.24) $ (0.26) $ $ (0.99) 2018 Research and development expenses $ 3,927 $ 7,232 $ 9,148 $ 8,087 $ 28,394 General and administrative expenses $ 2,187 $ 2,338 $ 2,073 $ 2,187 $ 8,785 Net loss $ (5,999) $ (9,504) $ (11,110) $ (10,113) $ (36,726) Net loss per common share, basic and diluted $ (0.15) $ (0.24) $ (0.27) $ $

Description of the Business and

Description of the Business and Liquidity (Details) - USD ($)	Dec. 13, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2019	Dec. 31, 2018
Liquidity
Accumulated deficit		$ 235,574,000	$ 181,453,000	$ 235,574,000	$ 181,453,000
Net proceeds from issuance of common stock and preferred stock		65,700,000
2017 Equity Distribution Agreement
Liquidity
Net proceeds from issuance of common stock				2,100,000
Series A Convertible Preferred Stock | Private placement
Liquidity
Issuance of Series A convertible preferred stock (in shares)		$ 30,000		$ 30,000
Common Stock
Liquidity
Issuance of stock (in shares)	32,200,000
Net proceeds from issuance of common stock	$ 37,400,000
Issuance of shares under equity distribution agreement (in shares)				1,692,289
Common Stock | Public Offering
Liquidity
Issuance of stock (in shares)		32,200,000	12,000,000	32,200,000	12,000,000
Net proceeds from issuance of common stock			$ 42,100,000
Common Stock | 2017 Equity Distribution Agreement
Liquidity
Net proceeds from issuance of common stock		$ 2,100,000
Issuance of shares under equity distribution agreement (in shares)		1,692,289		1,692,289	0

Summary of Significant Accoun_4

Summary of Significant Accounting Policies - Property and Equipment (Details)	12 Months Ended
	Dec. 31, 2019
Computer equipment and software
Property and Equipment
Useful life	3 years
Office equipment and furniture
Property and Equipment
Useful life	5 years
Leasehold improvements
Property and Equipment
Useful life	6 years
Minimum | Laboratory equipment
Property and Equipment
Useful life	5 years
Maximum | Laboratory equipment
Property and Equipment
Useful life	15 years

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Loss Per Share of Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018
Basic and diluted net loss per share of common stock:
Net loss	$ (15,409)	$ (13,806)	$ (12,423)	$ (12,483)	$ (10,113)	$ (11,110)	$ (9,504)	$ (5,999)	$ (54,121)	$ (36,726)
Weighted average shares of common stock outstanding (in shares)									54,512,778	40,895,406
Net loss per share of common stock—basic and diluted	$ (0.25)	$ (0.26)	$ (0.24)	$ (0.24)	$ (0.24)	$ (0.27)	$ (0.24)	$ (0.15)	$ (0.99)	$ (0.90)
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares)									32,572,681	5,056,609
Convertible preferred stock
Basic and diluted net loss per share of common stock:
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares)									24,000,000
Restricted stock
Basic and diluted net loss per share of common stock:
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares)									32,400	105,200
Stock options
Basic and diluted net loss per share of common stock:
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares)									8,540,281	4,951,409

Summary of Significant Accoun_6

Summary of Significant Accounting Policies - Segment Information (Details)	12 Months Ended
	Dec. 31, 2019segment
Segment Information
Number of operating segments	1

Summary of Significant Accoun_7

Summary of Significant Accounting Policies - Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Jan. 01, 2019
Right-of-use assets	$ 2,200
Operating lease liabilities	$ 3,489
Restatement Adjustment | Accounting Standards Update 2016-02
Right-of-use assets		$ 2,500
Operating lease liabilities		3,400
ROU adjustment for lease incentives		$ 900

Fair Value Measurements (Detail

Fair Value Measurements (Details) - Recurring basis - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Assets
Total assets	$ 86,134	$ 19,047
U.S. Treasury securities
Assets
Investments		4,998
Money market funds
Assets
Cash and cash equivalents, fair value	85,395	14,049
Certificates of deposit
Assets
Investments	739
Level 1
Assets
Total assets	86,134	14,049
Level 1 | Money market funds
Assets
Cash and cash equivalents, fair value	85,395	14,049
Level 1 | Certificates of deposit
Assets
Investments	$ 739
Level 2
Assets
Total assets		4,998
Level 2 | U.S. Treasury securities
Assets
Investments		$ 4,998

Property and Equipment (Details

Property and Equipment (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Property and equipment
Property and equipment, gross	$ 3,077	$ 1,904
Less: accumulated depreciation	(812)	(610)
Property and equipment	2,265	1,294
Depreciation expense	200	100
Laboratory equipment
Property and equipment
Property and equipment, gross	1,777	1,756
Leasehold improvements
Property and equipment
Property and equipment, gross	899
Office furniture and equipment
Property and equipment
Property and equipment, gross	$ 401	$ 148

Accrued Expenses (Details)

Accrued Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Accrued Expenses
Payroll and related costs	$ 2,514	$ 1,364
Clinical trials and drug development	1,849	2,781
Professional fees	396	204
Short-term lease liabilities	446
Other	63	88
Total accrued expenses	$ 5,268	$ 4,437

Leases (Details)

Leases (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Jan. 01, 2019
Leases
Weighted average remaining lease term	68 months
Right-of-use assets	$ 2,200
Operating lease liabilities	$ 3,489
Operating Lease, Liability, Statement of Financial Position [Extensible List]	us-gaap:OtherAccruedLiabilitiesNoncurrent us-gaap:AccruedLiabilitiesCurrent
Total lease costs	$ 700
Weighted-average incremental borrowing rate used to determine right-of-use assets and lease liabilities	11.00%
Maturities of operating lease liabilities
2020	$ 807
2021	818
2022	807
2023	823
2024	840
Thereafter	642
Total lease payments	4,737
Less: imputed interest	(1,248)
Total lease liabilities	3,489
Current operating lease liabilities	$ 446
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Accrued Liabilities, Current
Non-current operating lease liabilities	$ 3,043
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	Other Accrued Liabilities, Noncurrent
Rental expense		$ 200
Annual future minimum lease payments
2019		298
2020		807
2021		819
2022		807
2023		823
Thereafter		1,482
Total minimum lease payments		$ 5,036
Restatement Adjustment | Accounting Standards Update 2016-02
Leases
ROU adjustment for lease incentives			$ 900
Right-of-use assets			2,500
Operating lease liabilities			3,400
Maturities of operating lease liabilities
Total lease liabilities			$ 3,400
Minimum
Leases
Operating lease agreement term	36 months
Operating lease renewal term	24 years
Maximum
Leases
Operating lease agreement term	78 months
Operating lease renewal term	60 years
Short-term operating lease costs	$ 100

Investments (Details)

Investments (Details) - U.S. Treasury securities $ in Thousands	12 Months Ended
	Dec. 31, 2018USD ($)security
Investments
Number of securities in an unrealized loss position | security	1
Other-than-temporary impairments	$ 0
Total amortized cost	5,000
Total fair value	5,000
Unrealized loss	$ 1

Stockholders' Equity - Incentiv

Stockholders' Equity - Incentive Plans (Details) - shares	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Jan. 01, 2019	Dec. 31, 2017
Stock options
Stock option and incentive plans
Granted (in shares)	4,703,000	1,372,000
Outstanding (in shares)	8,540,281	4,951,409		3,754,320
2005 Plan
Stock option and incentive plans
Common stock reserved for issuance (in shares)	0
2005 Plan | Stock options
Stock option and incentive plans
Outstanding (in shares)	330,450
2014 Plan
Stock option and incentive plans
Common stock reserved for issuance (in shares)	663,460		5,082,305
2014 Plan | Stock options
Stock option and incentive plans
Outstanding (in shares)	7,121,331
2014 Plan | Restricted stock
Stock option and incentive plans
Outstanding (in shares)	32,400
Outside of 2014 Plan | Stock options
Stock option and incentive plans
Granted (in shares)	920,000	311,000

Stockholders' Equity - Stock Op

Stockholders' Equity - Stock Options and Restricted Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Stock options
Stock option and incentive plans
Total compensation cost	$ 5,633	$ 4,707
Contractual life	7 years 1 month 6 days
Stock Options
Outstanding at the beginning of the period (in shares)	4,951,409	3,754,320
Granted (in shares)	4,703,000	1,372,000
Exercised (in shares)	(80,020)	(12,308)
Forfeited (in shares)	(916,205)	(162,603)
Expired (in shares)	(117,903)
Outstanding at the end of the period (in shares)	8,540,281	4,951,409
Exercisable at the end of the period (in shares)	4,431,560
Exercisable and expected to vest at the end of the year (in shares)	8,540,281
Weighted-Average Exercise Price Per Share
Outstanding at the beginning of the period (in dollars per share)	$ 5.62	$ 5.22
Granted (in dollars per share)	2.31	6.60
Exercised (in dollars per share)	1.22	1.18
Forfeited (in dollars per share)	4.21	5
Expired (in dollars per share)	8.23
Outstanding at the end of the period (in dollars per share)	3.95	5.62
Exercisable at the end of the period (in dollars per share)	5.04
Exercisable and expected to vest at the end of the year (in dollars per share)	$ 3.95
Aggregate Intrinsic Value
Outstanding at the end of the period	$ 3,774
Exercisable at the end of the period	1,447
Exercisable and expected to vest at the end of the year	$ 3,774
Additional Disclosures
Weighted average remaining contractual term	8 years 1 month 6 days
Weighted average remaining contractual term exercisable	7 years 1 month 6 days
Market value per share		2.16
Weighted average grant date fair value (in dollars per share)	$ 1.90	$ 5.51
Weighted-average assumptions
Expected annual dividend yield (as a percent)	0.00%	0.00%
Unrecognized compensation expense
Unrecognized compensation expense	$ 8,291
Stock options | Recognition in 2020
Unrecognized compensation expense
Unrecognized compensation expense	3,981
Stock options | Recognition in 2021
Unrecognized compensation expense
Unrecognized compensation expense	2,941
Stock options | Recognition in 2022
Unrecognized compensation expense
Unrecognized compensation expense	1,065
Stock options | Recognition in 2023
Unrecognized compensation expense
Unrecognized compensation expense	$ 304
Stock options | Minimum
Weighted-average assumptions
Expected stock price volatility (as a percent)	104.70%	106.64%
Expected term of options	5 years 1 month 28 days	5 years 2 months 12 days
Risk-free interest rate (as a percent)	1.51%	2.32%
Stock options | Maximum
Weighted-average assumptions
Expected stock price volatility (as a percent)	118.87%	113.19%
Expected term of options	6 years 1 month 6 days	6 years 1 month 6 days
Risk-free interest rate (as a percent)	2.59%	3.10%
Restricted stock
Stock option and incentive plans
Total compensation cost	$ 39	$ 81
Vesting period	1 year
Unrecognized compensation expense
Unrecognized compensation cost	$ 0
Shares
Restricted stock units outstanding at the beginning of the period (in shares)	105,200	239,800
Granted (in shares)		0
Vested (in shares)	(52,600)	(120,600)
Forfeited (in shares)	(20,200)	(14,000)
Restricted stock units outstanding at the end of the period (in shares	32,400	105,200
Weighted Average Grant Date Fair Value
Restricted stock units outstanding at the beginning of the period (in dollars per shares)	$ 1.21	$ 1.21
Vested (in dollars per share)	1.21	1.21
Forfeited (in dollars per share)	1.21	1.21
Restricted stock units outstanding at the end of the period (in dollars per shares)	$ 1.21	$ 1.21
2005 Plan | Stock options
Stock Options
Outstanding at the end of the period (in shares)	330,450
2005 Plan | Stock options | Maximum
Stock option and incentive plans
Contractual life	10 years
Vesting period	4 years
Additional Disclosures
Weighted average remaining contractual term exercisable	10 years
2014 Plan | Stock options
Stock Options
Outstanding at the end of the period (in shares)	7,121,331
2014 Plan | Stock options | Maximum
Stock option and incentive plans
Contractual life	10 years
Vesting period	4 years
Additional Disclosures
Weighted average remaining contractual term exercisable	10 years
2014 Plan | Restricted stock
Stock Options
Outstanding at the end of the period (in shares)	32,400
Research and development | Stock options
Stock option and incentive plans
Total compensation cost	$ 2,563	$ 1,712
Research and development | Restricted stock
Stock option and incentive plans
Total compensation cost	19	19
General and administrative | Stock options
Stock option and incentive plans
Total compensation cost	3,070	2,995
General and administrative | Restricted stock
Stock option and incentive plans
Total compensation cost	$ 20	$ 62

Stockholders' Equity _ Equity D

Stockholders' Equity – Equity Distribution Agreement (Details) - USD ($)	Dec. 13, 2019	Oct. 31, 2017	Aug. 31, 2015	Dec. 31, 2019	Dec. 31, 2019	Dec. 31, 2018
Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Issuance of shares under equity distribution agreement (in shares)					1,692,289
Net proceeds from issuance of common stock	$ 37,400,000
2017 Equity Distribution Agreement
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Term of Equity Distribution Agreement		3 years
Value of common stock authorized under EDA		$ 50,000,000
Net proceeds from issuance of common stock					$ 2,100,000
Remaining value of common stock shares available under EDA				$ 34.8	$ 34.8
2017 Equity Distribution Agreement | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Sale of common stock, commission percentage			3.00%
2017 Equity Distribution Agreement | Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Issuance of shares under equity distribution agreement (in shares)				1,692,289	1,692,289	0
Net proceeds from issuance of common stock				$ 2,100,000

Stockholders' Equity _ Public O

Stockholders' Equity – Public Offering (Details) - USD ($) $ / shares in Units, $ in Millions	Dec. 13, 2019	Dec. 11, 2019	Dec. 31, 2019	Dec. 31, 2018
Public Offering
Common stock, par value (in dollars per share)			$ 0.001	$ 0.001
Common Stock
Public Offering
Shares issued	32,200,000
Net proceeds from issuance of common stock	$ 37.4
Stock issuance costs	$ 2.8
Public Offering | Common Stock
Public Offering
Shares issued		28,000,000
Common stock, par value (in dollars per share)		$ 0.001
Share Price (in dollars per share)		$ 1.25
Underwriter option | Common Stock
Public Offering
Shares issued	4,200,000

Convertible Preferred Stock (De

Convertible Preferred Stock (Details)	3 Months Ended	12 Months Ended
	Dec. 31, 2019USD ($)$ / sharesshares	Dec. 31, 2019USD ($)$ / sharesshares
Convertible Preferred Stock
Series A convertible preferred stock, par value (in dollars per share) | $ / shares	$ 0.001	$ 0.001
Private placement | Series A Convertible Preferred Stock
Convertible Preferred Stock
Issuance of Series A convertible preferred stock (in shares) | $	$ 30,000	$ 30,000
Series A convertible preferred stock, par value (in dollars per share) | $ / shares	$ 0.001	$ 0.001
Share Price (in dollars per share) | $ / shares	$ 1,000	$ 1,000
Net proceeds from issuance of Series A convertible preferred stock | $		$ 28,200,000
Underwriting discounts and commissions | $		$ 1,800,000
Number of common shares issued for each convertible stock | shares	800	800
Conversion price (in dollars per share) | $ / shares	$ 1.25	$ 1.25
Maximum penalty failure of registration		4.00%
Beneficial conversion feature of the convertible preferred stock | $		$ 8,900,000
Private placement | Series A Convertible Preferred Stock | Minimum
Convertible Preferred Stock
Beneficial interest limitation		9.99
Private placement | Series A Convertible Preferred Stock | Maximum
Convertible Preferred Stock
Beneficial interest limitation		19.99

Commitments and Contingencies (

Commitments and Contingencies (Details)	12 Months Ended
	Dec. 31, 2019
Employee Benefit Plan
Maximum employees contribution (as a percent)	50.00%
Vesting period	4 years
License Agreement | Purdue Neuroscience Company
License agreement
Expiration period of obligation to pay royalties	10 years

Commitments and Contingencies -

Commitments and Contingencies - License and Severance Arrangements (Details) - USD ($)	1 Months Ended
	Mar. 31, 2019	Dec. 31, 2019	Oct. 31, 2019	Aug. 31, 2019
Severance Arrangements, Chief Executive Officer
Commitments
Salary and benefits continuation, commitment	$ 600,000
Accelerated vesting of stock option agreements	$ 400,000
Unpaid benefits		$ 100,000
Employment Agreement, Chief Executive Officer
Commitments
Base salary				$ 537,500
Bonus, expressed as a percentage base salary				50.00%
Employment Agreement, Chief Medical Officer
Commitments
Base salary			$ 375,000
Bonus, expressed as a percentage base salary			35.00%

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Loss before income taxes
U.S. operations	$ 18,544	$ 7,855
Foreign operations	35,577	28,871
Loss before income taxes	54,121	36,726
Net operating loss carry forwards available to offset future federal and state taxable income	143,700	131,600
Gross deferred tax assets:
Net operating loss carryforwards	40,120	36,383
Accrued expenses	200	52
Contributions	4	3
Depreciation	42
Stock-based compensation	2,967	1,640
Research and development and other credits	9,118	6,545
Total gross deferred tax assets	52,451	44,623
Gross deferred tax liabilities:
Depreciation		(18)
Total gross deferred tax liabilities		(18)
Net deferred tax assets	52,451	44,605
Less: valuation allowance	(52,451)	(44,605)
Net deferred tax assets after valuation allowance	0	0
Increase (decrease) in valuation allowance	$ 7,800	$ 2,000
Reconciliation of income tax expense (benefit) at the statutory federal income tax rate and income taxes
Federal income tax expense at statutory rate (as a percent)	21.00%	21.00%	34.00%
Permanent items (as a percent)	(1.00%)	(0.90%)
State income tax, net of federal benefit (as a percent)	2.30%	0.10%
R&D tax credits (as a percent)	4.40%	4.30%
Change in federal statutory rate on deferreds (as a percent)	1.10%	(1.10%)
Foreign income tax effect (as a percent)	(13.80%)	(16.50%)
Other (as a percent)	0.50%	(1.60%)
Change in valuation allowance (as a percent)	(14.50%)	(5.30%)
Effective income tax rate (as a percent)	0.00%	0.00%
Research tax credit carryforward | Federal
Loss before income taxes
Tax credit carryovers	$ 8,400
Research tax credit carryforward | State
Loss before income taxes
Tax credit carryovers	$ 400

Quarterly Financial Informati_3

Quarterly Financial Information (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018
Quarterly Financial Information (unaudited)
Research and development expenses	$ 12,512	$ 11,572	$ 10,010	$ 8,872	$ 8,087	$ 9,148	$ 7,232	$ 3,927	$ 42,966	$ 28,394
General and administrative expenses	2,960	2,327	2,502	3,667	2,187	2,073	2,338	2,187	11,456	8,785
Net loss	$ (15,409)	$ (13,806)	$ (12,423)	$ (12,483)	$ (10,113)	$ (11,110)	$ (9,504)	$ (5,999)	$ (54,121)	$ (36,726)
Net loss per share, basic and diluted	$ (0.25)	$ (0.26)	$ (0.24)	$ (0.24)	$ (0.24)	$ (0.27)	$ (0.24)	$ (0.15)	$ (0.99)	$ (0.90)