Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Mar. 01, 2018 | Jun. 30, 2017 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | ZFGN | ||
Entity Registrant Name | Zafgen, Inc. | ||
Entity Central Index Key | 1,374,690 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 27,558,883 | ||
Entity Public Float | $ 64.9 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 40,777 | $ 32,352 |
Marketable securities | 61,275 | 96,842 |
Tax incentive receivable | 946 | 347 |
Prepaid expenses and other current assets | 1,927 | 1,358 |
Total current assets | 104,925 | 130,899 |
Property and equipment, net | 528 | 661 |
Other assets | 57 | 61 |
Total assets | 105,510 | 131,621 |
Current liabilities: | ||
Accounts payable | 3,020 | 2,572 |
Accrued expenses | 4,273 | 3,733 |
Notes payable, current | 3,589 | |
Total current liabilities | 7,293 | 9,894 |
Notes payable, long-term | 20,000 | |
Total liabilities | 27,293 | 9,894 |
Commitments and contingencies (Note 10) | ||
Stockholders' equity: | ||
Preferred stock; $0.001 par value per share; 5,000,000 shares authorized as of December 31, 2017 and 2016; no shares issued and outstanding as of and December 31, 2017 and 2016 | ||
Common stock, $0.001 par value per share; 115,000,000 shares authorized as of December 31, 2017 and 2016; 27,489,457 and 27,332,551 shares issued and outstanding as of December 31, 2017 and 2016, respectively | 27 | 27 |
Additional paid-in capital | 367,825 | 359,329 |
Accumulated deficit | (289,577) | (237,549) |
Accumulated other comprehensive loss | (58) | (80) |
Total stockholders' equity | 78,217 | 121,727 |
Total liabilities and stockholders' equity | $ 105,510 | $ 131,621 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value per share | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value per share | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 115,000,000 | 115,000,000 |
Common stock, shares issued | 27,489,457 | 27,332,551 |
Common stock, shares outstanding | 27,489,457 | 27,332,551 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | |||
Revenue | $ 0 | $ 0 | $ 0 |
Operating expenses: | |||
Research and development | 40,839 | 39,936 | 54,618 |
General and administrative | 12,160 | 18,289 | 19,195 |
Total operating expenses | 52,999 | 58,225 | 73,813 |
Loss from operations | (52,999) | (58,225) | (73,813) |
Other income (expense): | |||
Interest income | 996 | 894 | 438 |
Interest expense | (165) | (529) | (806) |
Foreign currency transaction gains (losses), net | 140 | (18) | (105) |
Total other income (expense), net | 971 | 347 | (473) |
Net loss | $ (52,028) | $ (57,878) | $ (74,286) |
Net loss per share, basic and diluted | $ (1.90) | $ (2.12) | $ (2.78) |
Weighted average common shares outstanding, basic and diluted | 27,433,239 | 27,297,934 | 26,756,079 |
Comprehensive loss: | |||
Net loss | $ (52,028) | $ (57,878) | $ (74,286) |
Other comprehensive gain (loss): | |||
Unrealized gain (loss) on marketable securities | 22 | 127 | (172) |
Total other comprehensive gain (loss) | 22 | 127 | (172) |
Total comprehensive loss | $ (52,006) | $ (57,751) | $ (74,458) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] |
Beginning balance at Dec. 31, 2014 | $ 104,441 | $ 23 | $ 209,838 | $ (105,385) | $ (35) |
Beginning balance, shares at Dec. 31, 2014 | 22,879,160 | ||||
Issuance of common stock | 129,571 | $ 4 | 129,567 | ||
Issuance of common stock, shares | 3,942,200 | ||||
Issuance of common stock upon exercise of stock options and employee stock purchase plan | 974 | 974 | |||
Issuance of common stock upon exercise of stock options and employee stock purchase plan, shares | 418,241 | ||||
Issuance of restricted stock units | 0 | $ 0 | 0 | 0 | 0 |
Issuance of restricted stock units, shares | 2,902 | ||||
Stock-based compensation expense | 8,582 | 8,582 | |||
Unrealized gain (loss) on marketable securities | (172) | (172) | |||
Net loss | (74,286) | (74,286) | |||
Ending balance at Dec. 31, 2015 | 169,110 | $ 27 | 348,961 | (179,671) | (207) |
Ending balance, shares at Dec. 31, 2015 | 27,242,503 | ||||
Issuance of common stock | 35 | 35 | |||
Issuance of common stock, shares | 5,564 | ||||
Issuance of common stock upon exercise of stock options and employee stock purchase plan | 220 | 220 | |||
Issuance of common stock upon exercise of stock options and employee stock purchase plan, shares | 72,663 | ||||
Issuance of restricted stock units | 0 | $ 0 | 0 | 0 | 0 |
Issuance of restricted stock units, shares | 11,821 | ||||
Stock-based compensation expense | 10,113 | 10,113 | |||
Unrealized gain (loss) on marketable securities | 127 | 127 | |||
Net loss | (57,878) | (57,878) | |||
Ending balance at Dec. 31, 2016 | 121,727 | $ 27 | 359,329 | (237,549) | (80) |
Ending balance, shares at Dec. 31, 2016 | 27,332,551 | ||||
Issuance of common stock upon exercise of stock options and employee stock purchase plan | 195 | 195 | |||
Issuance of common stock upon exercise of stock options and employee stock purchase plan, shares | 136,992 | ||||
Issuance of restricted stock units | 0 | $ 0 | 0 | 0 | 0 |
Issuance of restricted stock units, shares | 19,914 | ||||
Stock-based compensation expense | 8,301 | 8,301 | |||
Unrealized gain (loss) on marketable securities | 22 | 22 | |||
Net loss | (52,028) | (52,028) | |||
Ending balance at Dec. 31, 2017 | $ 78,217 | $ 27 | $ 367,825 | $ (289,577) | $ (58) |
Ending balance, shares at Dec. 31, 2017 | 27,489,457 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | |||
Net loss | $ (52,028) | $ (57,878) | $ (74,286) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Stock-based compensation expense | 8,301 | 10,113 | 8,582 |
Non-cash interest expense | 13 | 43 | 62 |
Depreciation expense | 188 | 212 | 70 |
Loss on disposal of research and development equipment | 328 | ||
Unrealized foreign currency transaction (gains) losses | (46) | 6 | 82 |
Premium on marketable securities | (359) | (340) | (2,036) |
Amortization of premium on marketable securities | 246 | 1,037 | 1,243 |
Changes in operating assets and liabilities: | |||
Prepaid expenses and other current assets | (569) | 413 | (363) |
Tax incentive receivable | (553) | 970 | (1,014) |
Accounts payable | 448 | (4,625) | 4,914 |
Accrued expenses | 575 | (2,254) | 3,192 |
Net cash used in operating activities | (43,784) | (51,975) | (59,554) |
Cash flows from investing activities: | |||
Proceeds from sales and maturities of marketable securities | 150,213 | 188,600 | 195,987 |
Purchases of marketable securities | (114,511) | (136,528) | (287,491) |
Purchases of property and equipment | (55) | (660) | (595) |
Deposits for leased property | 35 | (19) | |
Net cash provided by (used in) investing activities | 35,647 | 51,447 | (92,118) |
Cash flows from financing activities: | |||
Proceeds from issuance of notes payable | 20,000 | ||
Repayments of notes payable | (3,633) | (2,935) | (1,381) |
Proceeds from exercise of common stock options and employee stock purchase plan | 195 | 220 | 974 |
Proceeds from public offerings, net of commissions and underwriting discounts | 130,044 | ||
Payments of public offering costs | (473) | ||
Net cash provided by (used in) financing activities | 16,562 | (2,715) | 129,164 |
Net increase (decrease) in cash and cash equivalents | 8,425 | (3,243) | (22,508) |
Cash and cash equivalents at beginning of period | 32,352 | 35,595 | 58,103 |
Cash and cash equivalents at end of period | 40,777 | 32,352 | 35,595 |
Supplemental disclosure of non-cash investing and financing activities: | |||
Property and equipment included in accounts payable | 298 | ||
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | $ 141 | $ 388 | $ 584 |
Nature of the Business and Basi
Nature of the Business and Basis of Presentation | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Nature of the Business and Basis of Presentation | 1. Nature of the Business and Basis of Presentation Zafgen, Inc., or the Company, was incorporated on November 22, 2005 under the laws of the State of Delaware. The Company is a clinical-stage biopharmaceutical company leveraging its proprietary knowledge of the methionine aminopeptidase 2 (“MetAP2”) pathway to develop novel therapies for patients affected by a range of complex metabolic diseases. Zafgen has pioneered the study of MetAP2 inhibitors in both common and rare metabolic disorders, and its current disease areas of focus are type 2 diabetes, Prader-Willi syndrome (“PWS”) and liver diseases. The company’s lead product candidate is ZGN-1061, The Company’s product candidates are all in the research and development stage. There can be no assurance that the Company’s research and development will be successfully completed, that adequate protection for the Company’s intellectual property will be obtained, that any product candidates developed will obtain necessary government regulatory approval or that any approved products will be commercially viable. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will generate significant revenue from product sales. The Company operates in an environment of rapid change in technology and substantial competition from pharmaceutical and biotechnology companies. In addition, the Company is dependent upon the services of its employees and consultants. The Company has incurred losses and negative cash flows from operations since its inception. As of December 31, 2017, the Company had an accumulated deficit of $289.6 million. From its inception through December 31, 2017, the Company received net proceeds of $333.3 million from the sales of redeemable convertible preferred stock, the issuance of convertible promissory notes, the proceeds from its initial public offering (“IPO”) in June 2014 and its follow-on Based on its current operating plans, the Company believes its cash, cash equivalents and marketable securities of $102.1 million as of December 31, 2017 will be sufficient to fund its anticipated level of operations, capital expenditures and satisfy debt repayments for a period of at least one year from the issuance date of this Annual Report. If the Company is unable to raise additional funds through equity or debt financings, the Company may be required to delay, limit, reduce or terminate product development or future commercialization efforts or grant rights to develop and market products or product candidates that the Company would otherwise prefer to develop and market itself. The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Zafgen Securities Corporation, Zafgen Australia Pty Limited, and Zafgen Animal Health, LLC. All intercompany balances and transactions have been eliminated. The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements, and the reported amounts of expenses during the reporting periods. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the accrual of research and development expenses and the valuation of stock-based awards. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Actual results could differ from the Company’s estimates. Cash Equivalents The Company considers all short-term, highly liquid investments with original maturities of ninety days or less at acquisition date to be cash equivalents. Cash equivalents, which consist of money market funds, U.S. government securities, corporate bonds, and commercial paper, are stated at fair value. Concentration of Credit Risk and of Significant Suppliers Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash, cash equivalents and marketable securities. The Company has all cash, cash equivalents and marketable securities balances at three accredited financial institutions in amounts that exceed federally insured limits. The Company does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. The Company is dependent on third-party manufacturers to supply products for research and development activities in its programs. In particular, the Company relies and expects to continue to rely on a small number of manufacturers to supply it with its requirements for the active pharmaceutical ingredients and formulated drugs related to these programs. These programs could be adversely affected by a significant interruption in the supply of active pharmaceutical ingredients and formulated drugs. Marketable securities Marketable securities consist of investments with original maturities greater than ninety days. The Company has classified its investments with maturities beyond one year as short term, based on their highly liquid nature and because such marketable securities represent the investment of cash that is available for current operations. The Company considers its investment portfolio of investments as available-for-sale. Deferred Offering Costs The Company capitalizes certain legal, accounting and other third-party fees that are directly associated with in-process paid-in Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation expense is recognized using the straight-line method over a five-year estimated useful life for equipment, furniture and fixtures and office equipment. Leasehold improvements are amortized over the shorter of the asset life or the term of the lease agreement. Expenditures for repairs and maintenance of assets are charged to expense as incurred. Upon retirement or sale, the cost and related accumulated depreciation of assets disposed of are removed from the accounts and any resulting gain or loss is included in loss from operations. Impairment of Long-Lived Assets Long-lived assets consist of property and equipment. Long-lived assets to be held and used are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends, and significant changes or planned changes in the use of the assets. If an impairment review is performed to evaluate a long-lived asset for recoverability, the Company compares forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long-lived asset to its carrying value. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of an asset are less than its carrying amount. The impairment loss would be based on the excess of the carrying value of the impaired asset over its fair value, determined based on discounted cash flows. To date, the Company has not recorded any impairment losses on long-lived assets. Research and Development Costs Research and development costs are expensed as incurred. Included in research and development expenses are wages, stock-based compensation and benefits of employees, third-party license fees and milestones and other operational costs related to the Company’s research and development activities, including facility-related expenses and external costs of outside vendors engaged to conduct nonclinical studies, manufacturing activities, and clinical trials. The Company records research and development expenses net of any research and development tax incentives the Company is entitled to receive from government authorities. Research Contract Costs and Accruals The Company has entered into various research and development contracts with research institutions and other companies both inside and outside of the United States. These agreements are generally cancelable, and related payments are recorded as research and development expenses as incurred. The Company records accruals for estimated ongoing research costs. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the studies, including the phase or completion of events, invoices received and contracted costs. Significant judgments and estimates are made in determining the accrued balances at the end of any reporting period. Actual results could differ from the Company’s estimates. The Company’s historical accrual estimates have not been materially different from the actual costs. Patent Costs All patent-related costs incurred in connection with filing and prosecuting patent applications are recorded as general and administrative expenses as incurred, as recoverability of such expenditures is uncertain. Accounting for Stock-Based Compensation The Company measures all stock-based awards granted to employees and directors based on the fair value on the date of grant using the Black-Scholes option-pricing model. Compensation expense of those awards is recognized over the requisite service period, which is generally the vesting period of the respective award. Typically, the Company issues awards with only service-based and market-based vesting conditions and records the expense for these awards using the straight-line method. For stock-based awards granted to non-employee The Company classifies stock-based compensation expense in its consolidated statements of operations and comprehensive loss in the same manner in which the award recipient’s payroll costs are classified or in which the award recipient’s service payments are classified. Income Taxes The Company accounts for income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the consolidated financial statements or in the Company’s tax returns. Deferred taxes are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. The Company assesses the likelihood that its deferred tax assets will be recovered from future taxable income and, to the extent it believes, based upon the weight of available evidence, that it is more likely than not that all or a portion of deferred tax assets will not be realized, a valuation allowance is established through a charge to income tax expense. Potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected and considering prudent and feasible tax planning strategies. The Company accounts for uncertainty in income taxes recognized in the consolidated financial statements by applying a two-step more-likely-than-not Segment Data The Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions. The Company is a biopharmaceutical company dedicated to significantly improving the health and well-being of patients affected by both rare and prevalent metabolic diseases including type 2 diabetes, PWS and potentially other metabolically related disorders. No revenue has been generated since inception, and all tangible assets are held in the United States. Comprehensive Loss Comprehensive loss includes net loss as well as other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders. For the years ended December 31, 2017, 2016 and 2015, the Company’s only element of other comprehensive loss was unrealized gain or (loss) on marketable securities. Net Income (Loss) Per Share Upon the closing of the Company’s IPO in June 2014, all of the Company’s outstanding redeemable convertible preferred shares were converted into shares of common stock. Prior to this conversion, the Company followed the two-class two-class two-class two-class Basic net income (loss) per share is computed by dividing the net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted net income (loss) per share attributable to common stockholders is computed by dividing the diluted net income (loss) attributable to common stockholders by the weighted average number of common shares, including potential dilutive common shares assuming the dilutive effect of outstanding stock options and unvested restricted common shares, as determined using the treasury stock method. For periods in which the Company has reported net losses, diluted net loss per common share attributable to common stockholders is the same as basic net loss per common share attributable to common stockholders, since dilutive common shares are not assumed to have been issued if their effect is antidilutive. Recently Issued and Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (the “FASB”) issued ASU No. 2014-09, Revenue from Contracts with Customers 2016-08 , Revenue from Contract with Customers: Principal versus Agent Considerations 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients. non-cash In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes. In February 2016, the FASB issued ASU No. 2016-02, Leases In March 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting paid-in In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments In May 2017, the FASB issued ASU No. 2017-09, Compensation – Stock Compensation: Scope of Modification Accounting |
Fair Value Measurements and Mar
Fair Value Measurements and Marketable Securities | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements and Marketable Securities | 3. Fair Value Measurements and Marketable Securities Fair Value Measurements The following tables present information about the Company’s financial assets that have been measured at fair value as of December 31, 2017 and 2016 and indicate the fair value of the hierarchy of the valuation inputs utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair value determined by Level 2 inputs utilize observable inputs other than Level 1 prices, such as quoted prices, for similar assets or liabilities, quoted market prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. During the years ended December 31, 2017 and 2016, there were no transfers between Level 1 and Level 2 financial assets. The following tables summarize the Company’s cash equivalents and marketable securities as of December 31, 2017 and 2016: December 31, 2017 Total Quoted Significant Significant (in thousands) Cash equivalents: Money market funds $ 15,802 $ 15,802 $ — $ — Commercial paper 998 — 998 — Corporate bonds 549 — 549 — Total cash equivalents 17,349 15,802 1,547 — Marketable securities: Corporate bonds 50,844 — 50,844 — Commercial paper 9,951 — 9,951 — Certificates of deposit 480 — 480 — Total marketable securities 61,275 — 61,275 — Total cash equivalents and marketable securities $ 78,624 $ 15,802 $ 62,822 $ — December 31, 2016 Total Quoted Significant Significant (in thousands) Cash equivalents: Money market funds $ 22,091 $ 22,091 $ — $ — Commercial paper 2,997 — 2,997 — Corporate bonds 1,500 — 1,500 — Total cash equivalents 26,588 22,091 4,497 — Marketable securities: Corporate bonds 69,622 — 69,622 — Commercial paper 27,220 — 27,220 — Total marketable securities 96,842 — 96,842 — Total cash equivalents and marketable securities $ 123,430 $ 22,091 $ 101,339 $ — The carrying amounts reflected in the consolidated balance sheets for tax incentive receivable, accounts payable, and accrued expenses approximate fair value due to their short-term maturities. The carrying value of the Company’s outstanding notes payable approximates fair value (a Level 2 fair value measurement), reflecting interest rates currently available to the Company. Marketable Securities The following tables summarize the Company’s marketable securities as of December 31, 2017 and 2016: December 31, 2017 Amortized Gross Gross Fair Value (in thousands) Assets: Corporate bonds (due within 1 year) $ 50,892 $ — $ (48 ) $ 50,844 Commercial paper (due within 1 year) 9,961 — (10 ) 9,951 Certificates of deposit (due within 1 year) 480 — — 480 $ 61,333 $ — $ (58 ) $ 61,275 December 31, 2016 Amortized Gross Gross Fair Value (in thousands) Assets: Corporate bonds (due within 1 year) $ 68,777 $ — $ (54 ) $ 68,723 Corporate bonds (due after 1 year through 2 years) 901 — (2 ) 899 Commercial paper (due within 1 year) 27,244 — (24 ) 27,220 $ 96,922 $ — $ (80 ) $ 96,842 |
Property and Equipment, net
Property and Equipment, net | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | 4. Property and Equipment, net Property and equipment, net consisted of the following as of December 31, 2017 and 2016: December 31, Useful Life 2017 2016 (in thousands) Office equipment 5 years $ 421 $ 372 Furniture and fixtures 5 years 194 194 Equipment 5 years 6 — Leasehold improvements * 415 415 1,036 981 Less: Accumulated depreciation (508 ) (320 ) $ 528 $ 661 * shorter of asset life or lease term Depreciation expense was $0.2 million, $0.2 million and $0.1 million for the years ended December 31, 2017, 2016 and 2015, respectively. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2017 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | 5. Accrued Expenses Accrued expenses consisted of the following as of December 31, 2017 and 2016: December 31, 2017 2016 (in thousands) Accrued payroll and related expenses $ 2,229 $ 2,008 Accrued research and development expenses 1,647 892 Accrued professional fees 292 347 Accrued restructuring — 376 Accrued other 105 110 $ 4,273 $ 3,733 |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Notes Payable | 6. Notes Payable As of December 31, 2017, the Company had fully repaid all outstanding amounts due under a loan and security agreement with Oxford Finance LLC and Midcap Financial, or the 2014 Credit Facility, entered into in March 2014. On December 29, 2017, the Company entered into a loan and security agreement with Silicon Valley Bank (the “Term Loan”). The Term Loan provided for borrowings of $20.0 million. On December 29, 2017, the Company received proceeds of $20.0 million from the issuance of a promissory note. The promissory note issued under the Term Loan is collateralized by substantially all of the Company’s personal property, other than its intellectual property. Upon entering into this Term Loan, the Company is obligated to make monthly, interest-only payments until March 29, 2019 and, thereafter, to pay 33 consecutive, equal monthly installments of principal and interest from April 1, 2019 through December 1, 2021. The outstanding Term Loan bears a variable interest at an annual rate of 1.25% above the prime rate, which at December 31, 2017 was 4.5%. In addition, a final payment equal to 8.0% of the Term Loan is due upon the earlier of the maturity date, acceleration of the term loans or prepayment of all or part of the term loans. The Company accrues the final payment amount of $1.6 million, to outstanding debt by charges to interest expense using the effective-interest method from the date of issuance through the maturity date. The effective annual interest rate of the outstanding debt under the Term Loan is approximately 8.9%. Additionally, the Company, as the borrower, is required to maintain a minimum cash, cash equivalents and marketable securities balance at Silicon Valley Bank of no less than 105% of the total outstanding principal balance of the Term Loan, which as of December 31, 2017 was $21.0 million. Further, as of 45 days after the Term Loan was entered in, the Company must maintain a balance of unrestricted cash, cash equivalents and marketable securities at Silicon Valley Bank in an amount not less than the greater of (i) $55.0 million and (ii) sixty-five percent (65%) of all the Company’s cash, cash equivalents and marketable securities. If the Company does not meet this requirement it will not be considered an event of default provided it immediately secures 87.5% of the principal balance in a restricted cash account. There are negative covenants restricting the Company’s activities, including limitations on dispositions, mergers or acquisitions; encumbering or granting a security interest in its intellectual property; incurring indebtedness or liens; paying dividends; making certain investments; permit the aggregate value of cash maintained by its Australian subsidiary not to exceed $4.0 million and certain other business transactions. The Term Loan also includes events of default, the occurrence and continuation of any of which provides the lenders the right to exercise remedies against the Company and the collateral securing the loans under the Term Loan, including cash in the amount of the outstanding balance. These events of default include, among other things, failure to pay any amounts due under the Term Loan, insolvency, the occurrence of a material adverse event, the occurrence of any default under certain other indebtedness and a final judgment against the Company in an amount greater than $0.3 million. As of December 31, 2017 and 2016, notes payable consist of the following: December 31, 2017 (in thousands) Notes payable long-term $ 20,000 December 31, 2016 (in thousands) Notes payable 3,183 Debt discount, net of accretion (9 ) Accretion related to final payment 415 Notes payable, net of discount, short term $ 3,589 As of December 31, 2017, the estimated future principal payments due are as follows: Year Ending December 31, (in thousands) 2018 $ — 2019 5,454 2020 7,273 2021 7,273 Total $ 20,000 During the years ended December 31, 2017, 2016 and 2015, the Company recognized $0.2 million, $0.5 million and $0.8 million, respectively, of interest expense related to the 2014 Credit Facility. The effective annual interest rate of the debt under the 2014 Credit Facility was approximately 10.8%. As of December 31, 2017, interest expense incurred on the new Term Loan was immaterial. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stockholders' Equity | 7. Stockholders’ Equity On January 28, 2015, the Company completed a follow-on follow-on follow-on As of December 31, 2017 and 2016, the Company’s Certificate of Incorporation, as amended and restated, authorizes the Company to issue 5,000,000 shares of $0.001 par value preferred stock. The rights, preferences, restrictions, qualifications and limitations of such stock are to be determined by the Company’s board of directors. As of December 31, 2017 and 2016, the Company’s Certificate of Incorporation, as amended and restated, authorizes the Company to issue 115,000,000 shares of $0.001 par value common stock. |
Stock-Based Awards
Stock-Based Awards | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Awards | 8. Stock-Based Awards Stock Option Plan The Company’s 2014 Stock Option and Incentive Plan (the “2014 Plan”) provides for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units, unrestricted stock awards, performance-share awards, cash-based awards and dividend equivalent rights to employees, members of the board of directors and consultants of the Company. The number of shares initially reserved for issuance under the 2014 Plan was 2,168,221 shares of common stock. The number of shares reserved for issuance may be increased by the number of shares under the previously authorized 2006 Stock Option Plan that are not needed to fulfill the Company’s obligations for awards issued under the 2006 Stock Option Plan as a result of forfeiture, expiration, cancellation, termination or net issuances of awards thereunder. The number of shares of common stock that may be issued under the 2014 Plan is also subject to increase on the first day of each fiscal year by the lesser of (i) 4% of the Company’s outstanding shares of common stock as of that date, or (ii) an amount determined by the board of directors. As of December 31, 2017, 1,981,060 shares are available for grant under the 2014 Plan, including 1,093,302 shares automatically added to the 2014 Stock Option Plan on January 1, 2017. Stock Option Grants Option Grants with time-based vesting conditions During the years ended December 31, 2017, 2016 and 2015, the Company granted 1,214,874, 1,527,559 and 992,505 stock options under the 2014 Plan. The vesting of these awards is time-based and the restrictions typically lapse over periods of three to four years. Stock options were granted with exercise prices equal to the fair value of the Company’s common stock on the date of grant. The Company bases fair value of common stock on the quoted market price of the Company’s common stock. During the year ended December 31, 2017, the Company also granted 550,000 options with time-based vesting restrictions to the newly-hired Chief Executive Officer as an inducement grant outside of the 2014 Plan in accordance with NASDAQ Listing Rule 5635(c)(4). These stock options have a ten-year 3-year The fair value of each service-based stock option grant to employees and directors is estimated on the date of grant using the Black-Scholes option-pricing model. The Company estimates its expected volatility using a weighted average of the historical volatility of publicly-traded peer companies and its own common stock since its IPO in June 2014, and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded stock price for the duration of the expected term. The expected term of the Company’s stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. The assumptions that the Company used to determine the fair value of the stock options granted to employees and directors are as follows, presented on a weighted average basis: 2017 2016 2015 Risk-free interest rate 2.10 % 1.40 % 1.75 % Expected term (in years) 6.17 6.18 6.25 Expected volatility 93 % 87 % 87 % Expected dividend yield 0 % 0 % 0 % The following table summarizes the Company’s stock option activity described above, since December 31, 2016: Shares Issuable Weighted Average Aggregate (in years) (in thousands) Outstanding as of December 31, 2016 3,115,003 $ 14.40 7.2 $ 1,038 Granted 1,764,874 $ 3.88 Exercised (93,211 ) $ 0.80 Forfeited (292,465 ) $ 20.97 Outstanding as of December 31, 2017 4,494,201 $ 10.12 7.8 $ 3,251 Options vested and expected to vest as of December 31, 2017 4,494,201 $ 10.12 7.8 $ 3,251 Options exercisable as of December 31, 2017 2,088,452 $ 13.44 6.4 $ 1,955 The aggregate intrinsic value was calculated based on the positive differences between the market value of the Company’s common stock and the exercise prices of the options. The aggregate intrinsic value of service-based stock options exercised was $0.3 million, $0.1 million and $13.9 million during the years ended December 31, 2017, 2016 and 2015, respectively. The Company received cash proceeds from the exercise of stock options of $0.1 million, less than $0.1 million, and $0.8 million during the years ended December 31, 2017, 2016 and 2015, respectively. The weighted average grant-date fair value of service-based stock options granted to employees and directors during the years ended December 31, 2017, 2016 and 2015 was $2.91, $4.86, and $28.97 per share, respectively. As of December 31, 2017 and 2016, there were outstanding unvested service-based stock options held by nonemployees for the purchase of 77,567 and 6,401 shares of common stock, respectively. Option Grants with market-based vesting conditions In October 2017, the Company granted 687,500 common stock options that vest on the third anniversary of the grant date upon achievement by the Company of minimum common stock prices for 20 consecutive days during the Earning Period, the (“Price Target Options”). The Earning Period is defined as the period between the first anniversary of the grant date and the third anniversary of the grant date. Of the 687,500 Price Target Options granted in 2017, 137,500 were granted under the 2014 Stock Plan and 550,000 were granted to the newly-hired Chief Executive Officer as an inducement grant outside of the 2014 Plan in accordance with NASDAQ Listing Rule 5635(c)(4). These stock options have a ten-year The number of Price Target Options that will vest upon achievement of the target will vary based on the level of achievement from a maximum of 200% of the target shares to a threshold of 50% of the target shares, with no vesting, absent certain circumstances, if the threshold requirement is not achieved or the employee is no longer with the Company at the end of the three-year period. The Price Target Options are valued using Monte Carlo simulation models. The number of options expected to vest, based on achievement of the specified market condition, is factored into the grant date Monte Carlo valuations for the Price Target Options. Compensation expense is recognized ratably over the attribution period. The assumptions that the Company used to determine the fair value of the stock options granted to employees are as follows, presented on a weighted average basis: 2017 Risk-free interest rate 2.24 % Expected term (in years) 6.3 Expected volatility 94.6 % Expected dividend yield 0 % The total fair value of $3.1 million and a weighted average fair value of the Price Target Options was $4.56 per share. As of December 31, 2017, the entire 687,500 Price Target Options had an aggregate intrinsic value of $0.8 million and a remaining contractual term of 9.77 years remained outstanding. Restricted Stock Units The Company has granted restricted stock units with time-based vesting conditions. The Company values restricted stock units on the grant-date using the market price of the Company’s common stock. The aggregate intrinsic value of restricted stock units that vested during the years ended December 31, 2017, 2016 and 2015 was $0.1 million per year calculated as the fair value of the Company’s common stock on the date it vests. During the years ended December 31, 2017, 2016 and 2015, the Company granted 22,128, 13,273 and 4,769 restricted stock units, respectively, all of which vested during 2017, 2016 and 2015, respectively, at a weighted average grant-date fair value of $4.18, $7.91 and $34.46, respectively. As of December 31, 2017 and 2016, there were no unvested restricted stock units outstanding. 2014 Employee Stock Purchase Plan The Company has a 2014 Employee Stock Purchase Plan (the “ESPP”) under which a total of 265,000 shares of common stock were reserved for issuance. During both 2017 and 2016 there were two offering periods, January 1 through June 30 and July 1 through December 31. The per share purchase price for offerings is equal to the lesser of 85% of the closing market price of the Company’s common stock on the first day or last day of the offering period. The Company issued 43,781 and 37,663 shares during the years ended December 31, 2017 and 2016, respectively. As of December 31, 2017 and 2016, there are 176,016 and 219,797 shares, respectively, of common stock available for issuance to participating employees under the ESPP. Stock-based Compensation The Company recorded stock-based compensation expense related to stock options and restricted common stock in the following expense categories within its consolidated statements of operations: Year Ended December 31, 2017 2016 2015 (in thousands) Research and development $ 4,138 $ 3,543 $ 2,930 General and administrative 4,163 6,390 5,652 $ 8,301 $ 9,933 $ 8,582 In addition, during the year ended December 31, 2016, in connection with its strategic restructuring further discussed in Note 14, the Company recorded a one-time, non-cash As of December 31, 2017, the Company had unrecognized stock-based compensation expense related to its unvested service-based stock option awards of $10.7 million, which is expected to be recognized over the remaining weighted average vesting period of 2.54 years. As of December 31, 2017, the Company had unrecognized stock-based compensation expense related to its unvested market-based stock option awards of $3.1 million, which is expected to be recognized over the remaining weighted average vesting period of 2.77 years. |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 9. Net Loss Per Share Basic and diluted net loss per share was calculated as follows: Year Ended December 31, 2017 2016 2015 (in thousands, except per share data) Basic and diluted net loss per share: Numerator: Net loss $ (52,028 ) $ (57,878 ) $ (74,286 ) Denominator: Weighted average common shares outstanding, basic and diluted 27,433,239 27,297,934 26,756,079 Net loss per share, basic and diluted $ (1.90 ) $ (2.12 ) $ (2.78 ) The Company excluded the following common stock equivalents, outstanding as of December 31, 2017, 2016 and 2015, from the computation of diluted net loss per share for the years ended December 31, 2017, 2016 and 2015 because they had an anti-dilutive impact due to the net loss incurred for the periods: As of December 31, 2017 2016 2015 Options to purchase common stock 4,494,201 3,115,003 2,555,110 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. Commitments and Contingencies Leases The Company has a lease for office space in Boston, Massachusetts, effective as of July 28, 2014, with a term expiring July 31, 2017 and an option to extend the lease for three additional years. In March 2015, the Company entered into an operating lease for additional office space in Boston, Massachusetts, effective as of April 15, 2015, with a term expiring on July 31, 2017, and two options to extend this lease for three additional years each. In January 2017, the Company extended the leases for both office spaces in Boston, Massachusetts with new terms expiring on July 31, 2020. In addition, with the landlord’s consent, the Company has subleased 2,976 square feet of office space in Boston, Massachusetts to an unrelated third party beginning on January 1, 2017 and expiring on December 31, 2018, and the Company expects to receive approximately $0.2 million in sublease rental income. In October 2015, the Company entered into an operating lease for office space in San Diego, California, effective as of October 1, 2015, with a term expiring on September 30, 2019, and an option to extend this lease for five additional years. Future minimum lease payments for its operating leases as of December 31, 2017 were as follows: Year Ending December 31, (in thousands) 2018 $ 479 2019 464 2020 226 2021 — $ 1,169 During the years ended December 31, 2017, 2016 and 2015, the Company recognized $0.3 million, $0.4 million and $0.3 million, respectively, of rental expense related to office space. Intellectual Property Licenses The Company has acquired exclusive rights to develop patented compounds and related know-how As of December 31, 2017, the Company is obligated to make additional milestone payments of up to $12.3 million upon reaching certain pre-commercialization There were no milestones achieved during the years ended December 31, 2017, 2016 or 2015. The Company is also obligated to pay to the licensors a percentage of fees received if and when the Company sublicenses the technology. As of December 31, 2017, the Company has not yet developed a commercial product using the licensed technologies and it has not entered into any sublicense agreements for the technologies. Indemnification Agreements In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners, and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with members of management team and the board of directors of the Company that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. To date, the Company has not incurred any material costs as a result of such indemnifications. The Company does not believe that the outcome of any claims under indemnification arrangements will have a material effect on its financial position, results of operations or cash flows, and it has not accrued any liabilities related to such obligations in its consolidated financial statements as of December 31, 2017. Legal Proceedings The Company accrues a liability for legal contingencies when it believes that it is both probable that a liability has been incurred and that the Company can reasonably estimate the amount of the loss. The Company reviews these accruals and adjusts them to reflect ongoing negotiations, settlements, rulings, advice of legal counsel and other relevant information. To the extent new information is obtained and the views on the probable outcomes of claims, suits, assessments, investigations or legal proceedings change, changes in the Company’s accrued liabilities would be recorded in the period in which such determination is made. In addition, in accordance with the relevant authoritative guidance, for any matters in which the likelihood of material loss is at least reasonably possible, the Company will provide disclosure of the possible loss or range of loss. If a reasonable estimate cannot be made, however, the Company will provide disclosure to that effect. The Company expenses legal costs as they are incurred. On October 21, 2015, a purported stockholder of the Company filed a putative class action lawsuit in the U.S. District Court for the District of Massachusetts, against the Company and Thomas E. Hughes, captioned Aviad Bessler v. Zafgen, Inc. and Thomas E. Hughes, No. 1:15-cv-13618. 10b-5 The Company may periodically become subject to other legal proceedings and claims arising in connection with ongoing business activities, including claims or disputes related to patents that have been issued or that are pending in the field of research on which the Company is focused. Other than the above action, the Company is not aware of any other material claims as of December 31, 2017. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 11. Income Taxes During the years ended December 31, 2017, 2016 and 2015, the Company recorded no income tax benefits for the net operating losses incurred in each year due to its uncertainty of realizing a benefit from those items. The domestic and foreign components of loss before income taxes are as follows: 2017 2016 2015 (in thousands) Domestic $ (49,954 ) $ (57,799 ) $ (72,147 ) Foreign (2,074 ) (79 ) (2,139 ) Loss before income taxes $ (52,028 ) $ (57,878 ) $ (74,286 ) A reconciliation of the U.S. federal statutory income tax rate to the Company’s effective income tax rate is as follows: Year Ended December 31, 2017 2016 2015 Federal statutory income tax rate (34.0 %) (34.0 %) (34.0 %) Federal and state research and development tax credit (4.1 ) (2.9 ) (3.9 ) State taxes, net of federal benefit (2.4 ) (3.9 ) (3.9 ) Orphan drug tax credit 0.0 (1.3 ) (3.5 ) Stock compensation expense 1.5 0.7 0.9 Nondeductible Australia research and development expenses 1.4 0.0 1.0 Impact of federal rate change related to tax reform 65.2 0.0 0.0 Other items 1.2 1.3 0.1 Change in deferred tax asset valuation allowance (28.8 ) 40.1 43.3 Effective income tax rate 0.0 % 0.0 % 0.0 % Net deferred tax assets as of December 31, 2017 and 2016 consisted of the following: December 31, 2017 2016 (in thousands) Noncurrent deferred tax assets: Capitalized research and development expenses 49,325 59,489 Net operating loss carryforwards 13,848 14,991 Tax credit carryforwards 16,759 14,297 Capitalized legal expenses 1,646 2,119 Stock-based compensation 5,568 6,027 Accrued expenses 522 783 Other temporary differences 13 14 Total noncurrent deferred tax assets 87,681 97,720 Total gross deferred tax assets 87,681 97,720 Valuation allowance (87,681 ) (97,720 ) Net deferred tax assets $ — $ — Changes in the valuation allowance for deferred tax assets during the years ended December 31, 2017, 2016 and 2015 related primarily to changes in net operating loss carryforwards, capitalized research and development expenses and tax credit carryforwards and were as follows: Year Ended December 31, 2017 2016 2015 (in thousands) Valuation allowance as of beginning of year $ 97,720 $ 74,541 $ 42,398 Decreases recorded as benefit to income tax provision (10,039 ) — — Increases recorded to income tax provision — 23,179 32,143 Valuation allowance as of end of year $ 87,681 $ 97,720 $ 74,541 As of December 31, 2017, the Company had net operating loss carryforwards for federal and state income tax purposes of $54.0 million and $39.6 million, respectively, which begin to expire in 2026 and 2030, respectively. As of December 31, 2017, the Company also had available tax credit carryforwards for federal and state income tax purposes of $14.8 million and $2.4 million, respectively, which begin to expire in 2026 and 2021, respectively. Utilization of the net operating loss carryforwards and tax credit carryforwards may be subject to a substantial annual limitation under Section 382 of the Internal Revenue Code of 1986 due to ownership changes that have occurred previously or that could occur in the future. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income. On January 1, 2017 the Company adopted new accounting guidance released in March 2016 that updates the accounting for certain aspects of share-based payments to employees, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the consolidated statement of cash flows. On January 1, 2017, the deferred tax assets associated with federal and state net operating loss carryforwards and the capitalized research and development expense increased in the amounts of $9.4 million, $7.2 million and $3.4 million, respectively, offset by valuation allowance. The adoption of this standard did not impact the Company’s consolidated financial statements. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50% over a three-year tax-exempt As of December 31, 2017 and 2016, the Company’s gross deferred tax asset balance of $87.7 million and $97.7 million, respectively, was comprised principally of net operating loss carryforwards, capitalized research and development expenses and tax credit carryforwards. During the years ended December 31, 2017, 2016 and 2015, gross deferred tax assets (decreased) increased due to additional net operating loss carryforwards, research and development tax credits generated and additional research and development expenses capitalized for tax purposes. The Company has evaluated the positive and negative evidence bearing upon its ability to realize the deferred tax assets. Management has considered the Company’s history of cumulative net losses incurred since inception and its lack of commercialization of any products or generation of any revenue from product sales since inception and has concluded that it is more likely than not that the Company will not realize the benefits of the deferred tax assets. Accordingly, a full valuation allowance has been established against the deferred tax assets as of December 31, 2017 and 2016. Management reevaluates the positive and negative evidence at each reporting period. The Company has not recorded any amounts for unrecognized tax benefits as of December 31, 2017 or 2016. The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by federal and state jurisdictions, where applicable. There are currently no pending income tax examinations. The Company’s tax years are still open under statute from 2013 to the present. Earlier years may be examined to the extent that tax credit or net operating loss carryforwards are used in future periods. The Company’s policy is to record interest and penalties related to income taxes as part of its income tax provision. On December 22, 2017, the Tax Cuts and Jobs Act ( “TCJA”) was signed into United States law. The TCJA includes a number of changes to existing tax law, including, among other things, a permanent reduction in the federal corporate income tax rate from a top marginal rate of 34% down to a flat rate of 21%, effective as of January 1, 2018, as well as limitation of the deduction for net operating losses to 80% of annual taxable income and elimination of net operating loss carrybacks, in each case, for losses arising in taxable years beginning after December 31, 2017 (though any such net operating losses may be carried forward indefinitely). As a result of the TCJA, the Company was required to revalue deferred tax assets and liabilities at 21%. This revaluation resulted in a provision of $33.8 million to income tax expense in continuing operations and a corresponding reduction in the valuation allowance. There was no impact to the Company’s consolidated statements of operations and comprehensive loss as a result of the reduction in rates. The other provisions of the TCJA did not have a material impact on the Company’s consolidated financial statements. In accordance with authoritative guidance issued by the Securities and Exchange Commission (“SEC”), the income tax effect of the TCJA represent provisional amounts for which the Company’s accounting is incomplete but for which reasonable estimates were determined and recorded during the fourth quarter of 2017. The guidance provides for a measurement period, up to one year from the enactment date, in which provisional amounts may be adjusted when additional information is obtained, prepared and analyzed. Adjustments to provisional amounts identified during the measurement period will be recorded during fiscal year 2018 to reflect any such guidance provided. |
Retirement Plan
Retirement Plan | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Retirement Plan | 12. Retirement Plan The Company has a Savings Incentive Match Plan, or SIMPLE IRA, for employees. Under the terms of the plan, the Company contributes 2% of an employee’s annual base salary, up to a maximum of the annual Internal Revenue Service compensation limits, for all full-time employees. The Company terminated this plan as of December 31, 2017 and implemented a new 401(k) plan in 2018. During the years ended December 31, 2017, 2016 and 2015, the Company recognized $0.1 million, $0.2 million and $0.1 million, respectively, of expense related to its contributions to the plan. |
Australia Research and Developm
Australia Research and Development Tax Incentive | 12 Months Ended |
Dec. 31, 2017 | |
Research and Development [Abstract] | |
Australia Research and Development Tax Incentive | 13. Australia Research and Development Tax Incentive The Company’s wholly owned subsidiary, Zafgen Australia Pty Limited, which conducts core research and development activities on behalf of the Company, is eligible to receive a 43.5% refundable tax incentive for qualified research and development activities. For the years ended December 31, 2017, 2016 and 2015, $0.9 million, $0.3 million and $1.4 million, respectively, were recorded as a reduction to research and development expenses in the consolidated statements of operations. These amounts represented 43.5% for 2017 and 45% for 2016 and 2015, of the Company’s qualified research and development spending in Australia. The refund is denominated in Australian dollars and, therefore, the related receivable is re-measured |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | 14. Restructuring On July 19, 2016, the Company announced that following a comprehensive review of its assets and clinical programs, as well as feedback from regulatory authorities, the Company refocused its resources on development of a differentiated second-generation MetAP2 inhibitor, ZGN-1061. ZGN-1061 During the year ended December 31, 2016, the Company recorded $1.4 million of restructuring-related costs in operating expense, including employee severance, benefits and related costs, as well as a stock option modification. The stock option modification was a one-time, non-cash The following table summarizes the restructuring costs by category for the periods indicated: Year Ended December 31, 2016 (in thousands) Cash Non-cash Total Research and development $ 455 $ 7 $ 462 General and administrative 768 173 941 $ 1,223 $ 180 $ 1,403 The following table summarizes the restructuring reserve for the periods indicated: Year Ended December 31, 2017 2016 (in thousands) Restructuring reserve beginning balance $ 376 $ — Restructuring expenses incurred during the period 24 1,223 Amounts paid during the period (400 ) (847 ) Restructuring reserve ending balance $ — $ 376 |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | 15. Quarterly Financial Data (Unaudited) The following information has been derived from unaudited consolidated financial statements that, in the opinion of management, include all recurring adjustments necessary for a fair statement of such information. Three Months Ended March 31, June 30, September 30, December 31, 2017 2017 2017 2017 (in thousands, except per share data) Revenue $ — $ — $ — $ — Operating expenses 13,265 13,536 12,840 13,358 Net loss (13,011 ) (13,347 ) (12,585 ) (13,085 ) Net loss per share, basic and diluted $ (0.48 ) $ (0.49 ) $ (0.46 ) $ (0.48 ) Weighted average common shares outstanding, basic and diluted 27,350,673 27,407,408 27,483,550 27,489,397 Three Months Ended March 31, June 30, September 30, December 31, 2016 2016 2016 2016 (in thousands, except per share data) Revenue $ — $ — $ — $ — Operating expenses 17,857 15,062 14,831 10,475 Net loss (17,736 ) (15,028 ) (14,675 ) (10,439 ) Net loss per share, basic and diluted $ (0.65 ) $ (0.55 ) $ (0.54 ) $ (0.38 ) Weighted average common shares outstanding, basic and diluted 27,263,435 27,272,225 27,322,907 27,332,515 |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements, and the reported amounts of expenses during the reporting periods. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the accrual of research and development expenses and the valuation of stock-based awards. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Actual results could differ from the Company’s estimates. |
Cash Equivalents | Cash Equivalents The Company considers all short-term, highly liquid investments with original maturities of ninety days or less at acquisition date to be cash equivalents. Cash equivalents, which consist of money market funds, U.S. government securities, corporate bonds, and commercial paper, are stated at fair value. |
Concentration of Credit Risk and of Significant Suppliers | Concentration of Credit Risk and of Significant Suppliers Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash, cash equivalents and marketable securities. The Company has all cash, cash equivalents and marketable securities balances at three accredited financial institutions in amounts that exceed federally insured limits. The Company does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. The Company is dependent on third-party manufacturers to supply products for research and development activities in its programs. In particular, the Company relies and expects to continue to rely on a small number of manufacturers to supply it with its requirements for the active pharmaceutical ingredients and formulated drugs related to these programs. These programs could be adversely affected by a significant interruption in the supply of active pharmaceutical ingredients and formulated drugs. |
Marketable securities | Marketable securities Marketable securities consist of investments with original maturities greater than ninety days. The Company has classified its investments with maturities beyond one year as short term, based on their highly liquid nature and because such marketable securities represent the investment of cash that is available for current operations. The Company considers its investment portfolio of investments as available-for-sale. |
Deferred Offering Costs | Deferred Offering Costs The Company capitalizes certain legal, accounting and other third-party fees that are directly associated with in-process paid-in |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation expense is recognized using the straight-line method over a five-year estimated useful life for equipment, furniture and fixtures and office equipment. Leasehold improvements are amortized over the shorter of the asset life or the term of the lease agreement. Expenditures for repairs and maintenance of assets are charged to expense as incurred. Upon retirement or sale, the cost and related accumulated depreciation of assets disposed of are removed from the accounts and any resulting gain or loss is included in loss from operations. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets consist of property and equipment. Long-lived assets to be held and used are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends, and significant changes or planned changes in the use of the assets. If an impairment review is performed to evaluate a long-lived asset for recoverability, the Company compares forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long-lived asset to its carrying value. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of an asset are less than its carrying amount. The impairment loss would be based on the excess of the carrying value of the impaired asset over its fair value, determined based on discounted cash flows. To date, the Company has not recorded any impairment losses on long-lived assets. |
Research and Development Costs | Research and Development Costs Research and development costs are expensed as incurred. Included in research and development expenses are wages, stock-based compensation and benefits of employees, third-party license fees and milestones and other operational costs related to the Company’s research and development activities, including facility-related expenses and external costs of outside vendors engaged to conduct nonclinical studies, manufacturing activities, and clinical trials. The Company records research and development expenses net of any research and development tax incentives the Company is entitled to receive from government authorities. |
Research Contract Costs and Accruals | Research Contract Costs and Accruals The Company has entered into various research and development contracts with research institutions and other companies both inside and outside of the United States. These agreements are generally cancelable, and related payments are recorded as research and development expenses as incurred. The Company records accruals for estimated ongoing research costs. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the studies, including the phase or completion of events, invoices received and contracted costs. Significant judgments and estimates are made in determining the accrued balances at the end of any reporting period. Actual results could differ from the Company’s estimates. The Company’s historical accrual estimates have not been materially different from the actual costs. |
Patent Costs | Patent Costs All patent-related costs incurred in connection with filing and prosecuting patent applications are recorded as general and administrative expenses as incurred, as recoverability of such expenditures is uncertain. |
Accounting for Stock-Based Compensation | Accounting for Stock-Based Compensation The Company measures all stock-based awards granted to employees and directors based on the fair value on the date of grant using the Black-Scholes option-pricing model. Compensation expense of those awards is recognized over the requisite service period, which is generally the vesting period of the respective award. Typically, the Company issues awards with only service-based and market-based vesting conditions and records the expense for these awards using the straight-line method. For stock-based awards granted to non-employee The Company classifies stock-based compensation expense in its consolidated statements of operations and comprehensive loss in the same manner in which the award recipient’s payroll costs are classified or in which the award recipient’s service payments are classified. |
Income Taxes | Income Taxes The Company accounts for income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the consolidated financial statements or in the Company’s tax returns. Deferred taxes are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. The Company assesses the likelihood that its deferred tax assets will be recovered from future taxable income and, to the extent it believes, based upon the weight of available evidence, that it is more likely than not that all or a portion of deferred tax assets will not be realized, a valuation allowance is established through a charge to income tax expense. Potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected and considering prudent and feasible tax planning strategies. The Company accounts for uncertainty in income taxes recognized in the consolidated financial statements by applying a two-step more-likely-than-not |
Segment Data | Segment Data The Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions. The Company is a biopharmaceutical company dedicated to significantly improving the health and well-being of patients affected by both rare and prevalent metabolic diseases including type 2 diabetes, PWS and potentially other metabolically related disorders. No revenue has been generated since inception, and all tangible assets are held in the United States. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss includes net loss as well as other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders. For the years ended December 31, 2017, 2016 and 2015, the Company’s only element of other comprehensive loss was unrealized gain or (loss) on marketable securities. |
Net Income (Loss) Per Share | Net Income (Loss) Per Share Upon the closing of the Company’s IPO in June 2014, all of the Company’s outstanding redeemable convertible preferred shares were converted into shares of common stock. Prior to this conversion, the Company followed the two-class two-class two-class two-class Basic net income (loss) per share is computed by dividing the net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted net income (loss) per share attributable to common stockholders is computed by dividing the diluted net income (loss) attributable to common stockholders by the weighted average number of common shares, including potential dilutive common shares assuming the dilutive effect of outstanding stock options and unvested restricted common shares, as determined using the treasury stock method. For periods in which the Company has reported net losses, diluted net loss per common share attributable to common stockholders is the same as basic net loss per common share attributable to common stockholders, since dilutive common shares are not assumed to have been issued if their effect is antidilutive. |
Recently Issued and Adopted Accounting Pronouncements | Recently Issued and Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (the “FASB”) issued ASU No. 2014-09, Revenue from Contracts with Customers 2016-08 , Revenue from Contract with Customers: Principal versus Agent Considerations 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients. non-cash In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes. In February 2016, the FASB issued ASU No. 2016-02, Leases In March 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting paid-in In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments In May 2017, the FASB issued ASU No. 2017-09, Compensation – Stock Compensation: Scope of Modification Accounting |
Fair Value Measurements and M23
Fair Value Measurements and Marketable Securities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Summary of Cash Equivalents and Marketable Securities | The following tables summarize the Company’s cash equivalents and marketable securities as of December 31, 2017 and 2016: December 31, 2017 Total Quoted Significant Significant (in thousands) Cash equivalents: Money market funds $ 15,802 $ 15,802 $ — $ — Commercial paper 998 — 998 — Corporate bonds 549 — 549 — Total cash equivalents 17,349 15,802 1,547 — Marketable securities: Corporate bonds 50,844 — 50,844 — Commercial paper 9,951 — 9,951 — Certificates of deposit 480 — 480 — Total marketable securities 61,275 — 61,275 — Total cash equivalents and marketable securities $ 78,624 $ 15,802 $ 62,822 $ — December 31, 2016 Total Quoted Significant Significant (in thousands) Cash equivalents: Money market funds $ 22,091 $ 22,091 $ — $ — Commercial paper 2,997 — 2,997 — Corporate bonds 1,500 — 1,500 — Total cash equivalents 26,588 22,091 4,497 — Marketable securities: Corporate bonds 69,622 — 69,622 — Commercial paper 27,220 — 27,220 — Total marketable securities 96,842 — 96,842 — Total cash equivalents and marketable securities $ 123,430 $ 22,091 $ 101,339 $ — |
Summary of Marketable Securities | The following tables summarize the Company’s marketable securities as of December 31, 2017 and 2016: December 31, 2017 Amortized Gross Gross Fair Value (in thousands) Assets: Corporate bonds (due within 1 year) $ 50,892 $ — $ (48 ) $ 50,844 Commercial paper (due within 1 year) 9,961 — (10 ) 9,951 Certificates of deposit (due within 1 year) 480 — — 480 $ 61,333 $ — $ (58 ) $ 61,275 December 31, 2016 Amortized Gross Gross Fair Value (in thousands) Assets: Corporate bonds (due within 1 year) $ 68,777 $ — $ (54 ) $ 68,723 Corporate bonds (due after 1 year through 2 years) 901 — (2 ) 899 Commercial paper (due within 1 year) 27,244 — (24 ) 27,220 $ 96,922 $ — $ (80 ) $ 96,842 |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property Plant and Equipment Net | Property and equipment, net consisted of the following as of December 31, 2017 and 2016: December 31, Useful Life 2017 2016 (in thousands) Office equipment 5 years $ 421 $ 372 Furniture and fixtures 5 years 194 194 Equipment 5 years 6 — Leasehold improvements * 415 415 1,036 981 Less: Accumulated depreciation (508 ) (320 ) $ 528 $ 661 * shorter of asset life or lease term |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses consisted of the following as of December 31, 2017 and 2016: December 31, 2017 2016 (in thousands) Accrued payroll and related expenses $ 2,229 $ 2,008 Accrued research and development expenses 1,647 892 Accrued professional fees 292 347 Accrued restructuring — 376 Accrued other 105 110 $ 4,273 $ 3,733 |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | As of December 31, 2017 and 2016, notes payable consist of the following: December 31, 2017 (in thousands) Notes payable long-term $ 20,000 December 31, 2016 (in thousands) Notes payable 3,183 Debt discount, net of accretion (9 ) Accretion related to final payment 415 Notes payable, net of discount, short term $ 3,589 |
Schedule of Estimated Future Principal Payments | As of December 31, 2017, the estimated future principal payments due are as follows: Year Ending December 31, (in thousands) 2018 $ — 2019 5,454 2020 7,273 2021 7,273 Total $ 20,000 |
Stock-Based Awards (Tables)
Stock-Based Awards (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Stock Option Activity | The following table summarizes the Company’s stock option activity described above, since December 31, 2016: Shares Issuable Weighted Average Aggregate (in years) (in thousands) Outstanding as of December 31, 2016 3,115,003 $ 14.40 7.2 $ 1,038 Granted 1,764,874 $ 3.88 Exercised (93,211 ) $ 0.80 Forfeited (292,465 ) $ 20.97 Outstanding as of December 31, 2017 4,494,201 $ 10.12 7.8 $ 3,251 Options vested and expected to vest as of December 31, 2017 4,494,201 $ 10.12 7.8 $ 3,251 Options exercisable as of December 31, 2017 2,088,452 $ 13.44 6.4 $ 1,955 |
Summary of Stock-Based Compensation Expense Related to Stock Options and Restricted Common Stock | The Company recorded stock-based compensation expense related to stock options and restricted common stock in the following expense categories within its consolidated statements of operations: Year Ended December 31, 2017 2016 2015 (in thousands) Research and development $ 4,138 $ 3,543 $ 2,930 General and administrative 4,163 6,390 5,652 $ 8,301 $ 9,933 $ 8,582 |
Time-Based Vesting Conditions [Member] | |
Assumptions used to Determine Fair Value of Stock Options Granted | any cash dividends in the foreseeable future. The assumptions that the Company used to determine the fair value of the stock options granted to employees and directors are as follows, presented on a weighted average basis: 2017 2016 2015 Risk-free interest rate 2.10 % 1.40 % 1.75 % Expected term (in years) 6.17 6.18 6.25 Expected volatility 93 % 87 % 87 % Expected dividend yield 0 % 0 % 0 % |
Market-Based Vesting Conditions [Member] | |
Assumptions used to Determine Fair Value of Stock Options Granted | The assumptions that the Company used to determine the fair value of the stock options granted to employees are as follows, presented on a weighted average basis: 2017 Risk-free interest rate 2.24 % Expected term (in years) 6.3 Expected volatility 94.6 % Expected dividend yield 0 % |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Share | Basic and diluted net loss per share was calculated as follows: Year Ended December 31, 2017 2016 2015 (in thousands, except per share data) Basic and diluted net loss per share: Numerator: Net loss $ (52,028 ) $ (57,878 ) $ (74,286 ) Denominator: Weighted average common shares outstanding, basic and diluted 27,433,239 27,297,934 26,756,079 Net loss per share, basic and diluted $ (1.90 ) $ (2.12 ) $ (2.78 ) |
Summary of Common Stock Equivalents Outstanding | The Company excluded the following common stock equivalents, outstanding as of December 31, 2017, 2016 and 2015, from the computation of diluted net loss per share for the years ended December 31, 2017, 2016 and 2015 because they had an anti-dilutive impact due to the net loss incurred for the periods: As of December 31, 2017 2016 2015 Options to purchase common stock 4,494,201 3,115,003 2,555,110 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments for Operating Leases | Future minimum lease payments for its operating leases as of December 31, 2017 were as follows: Year Ending December 31, (in thousands) 2018 $ 479 2019 464 2020 226 2021 — $ 1,169 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Domestic and Foreign Components of Loss Before Income Taxes | The domestic and foreign components of loss before income taxes are as follows: 2017 2016 2015 (in thousands) Domestic $ (49,954 ) $ (57,799 ) $ (72,147 ) Foreign (2,074 ) (79 ) (2,139 ) Loss before income taxes $ (52,028 ) $ (57,878 ) $ (74,286 ) |
Reconciliation of Federal Statutory Income Tax Rate | A reconciliation of the U.S. federal statutory income tax rate to the Company’s effective income tax rate is as follows: Year Ended December 31, 2017 2016 2015 Federal statutory income tax rate (34.0 %) (34.0 %) (34.0 %) Federal and state research and development tax credit (4.1 ) (2.9 ) (3.9 ) State taxes, net of federal benefit (2.4 ) (3.9 ) (3.9 ) Orphan drug tax credit 0.0 (1.3 ) (3.5 ) Stock compensation expense 1.5 0.7 0.9 Nondeductible Australia research and development expenses 1.4 0.0 1.0 Impact of federal rate change related to tax reform 65.2 0.0 0.0 Other items 1.2 1.3 0.1 Change in deferred tax asset valuation allowance (28.8 ) 40.1 43.3 Effective income tax rate 0.0 % 0.0 % 0.0 % |
Schedule of Net Deferred Tax Assets | Net deferred tax assets as of December 31, 2017 and 2016 consisted of the following: December 31, 2017 2016 (in thousands) Noncurrent deferred tax assets: Capitalized research and development expenses 49,325 59,489 Net operating loss carryforwards 13,848 14,991 Tax credit carryforwards 16,759 14,297 Capitalized legal expenses 1,646 2,119 Stock-based compensation 5,568 6,027 Accrued expenses 522 783 Other temporary differences 13 14 Total noncurrent deferred tax assets 87,681 97,720 Total gross deferred tax assets 87,681 97,720 Valuation allowance (87,681 ) (97,720 ) Net deferred tax assets $ — $ — |
Summary Changes in the Valuation Allowance for Deferred Tax Assets | Changes in the valuation allowance for deferred tax assets during the years ended December 31, 2017, 2016 and 2015 related primarily to changes in net operating loss carryforwards, capitalized research and development expenses and tax credit carryforwards and were as follows: Year Ended December 31, 2017 2016 2015 (in thousands) Valuation allowance as of beginning of year $ 97,720 $ 74,541 $ 42,398 Decreases recorded as benefit to income tax provision (10,039 ) — — Increases recorded to income tax provision — 23,179 32,143 Valuation allowance as of end of year $ 87,681 $ 97,720 $ 74,541 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Summary of Restructuring Costs by Category | The following table summarizes the restructuring costs by category for the periods indicated: Year Ended December 31, 2016 (in thousands) Cash Non-cash Total Research and development $ 455 $ 7 $ 462 General and administrative 768 173 941 $ 1,223 $ 180 $ 1,403 |
Summary of Restructuring Reserve | The following table summarizes the restructuring reserve for the periods indicated: Year Ended December 31, 2017 2016 (in thousands) Restructuring reserve beginning balance $ 376 $ — Restructuring expenses incurred during the period 24 1,223 Amounts paid during the period (400 ) (847 ) Restructuring reserve ending balance $ — $ 376 |
Quarterly Financial Data (Una32
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Unaudited Consolidated Financial Statements | The following information has been derived from unaudited consolidated financial statements that, in the opinion of management, include all recurring adjustments necessary for a fair statement of such information. Three Months Ended March 31, June 30, September 30, December 31, 2017 2017 2017 2017 (in thousands, except per share data) Revenue $ — $ — $ — $ — Operating expenses 13,265 13,536 12,840 13,358 Net loss (13,011 ) (13,347 ) (12,585 ) (13,085 ) Net loss per share, basic and diluted $ (0.48 ) $ (0.49 ) $ (0.46 ) $ (0.48 ) Weighted average common shares outstanding, basic and diluted 27,350,673 27,407,408 27,483,550 27,489,397 Three Months Ended March 31, June 30, September 30, December 31, 2016 2016 2016 2016 (in thousands, except per share data) Revenue $ — $ — $ — $ — Operating expenses 17,857 15,062 14,831 10,475 Net loss (17,736 ) (15,028 ) (14,675 ) (10,439 ) Net loss per share, basic and diluted $ (0.65 ) $ (0.55 ) $ (0.54 ) $ (0.38 ) Weighted average common shares outstanding, basic and diluted 27,263,435 27,272,225 27,322,907 27,332,515 |
Stock-Based Awards - Summary of
Stock-Based Awards - Summary of Stock-Based Compensation Expense Related to Stock Options and Restricted Common Stock (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | $ 8,301 | $ 9,933 | $ 8,582 |
Total stock-based compensation expense | 8,301 | 9,933 | 8,582 |
Research and Development [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | 4,138 | 3,543 | 2,930 |
Total stock-based compensation expense | 4,138 | 3,543 | 2,930 |
General and Administrative [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | 4,163 | 6,390 | 5,652 |
Total stock-based compensation expense | $ 4,163 | $ 6,390 | $ 5,652 |
Nature of the Business and Ba34
Nature of the Business and Basis of Presentation - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | 145 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2017 | Dec. 29, 2017 | Dec. 31, 2016 | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | ||||
Entity incorporation date | Nov. 22, 2005 | |||
Accumulated deficit | $ (289,577) | $ (289,577) | $ (237,549) | |
Net proceeds from sale of securities | 333,300 | |||
Total cash, cash equivalents and marketable securities | 102,100 | 102,100 | ||
Term Loan [Member] | ||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | ||||
Aggregate principal balance | 20,000 | 20,000 | $ 20,000 | |
Loan agreement minimum liquidity required | $ 21,000 | $ 21,000 | $ 21,000 |
Summary of Significant Accoun35
Summary of Significant Accounting Policies - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Accounting Policies [Abstract] | |
Estimated useful life | 5 years |
Impairment losses on long-lived assets | $ 0 |
Percentage of likelihood to be realized upon ultimate settlement, description | 50.00% |
Fair Value Measurements and M36
Fair Value Measurements and Marketable Securities - Summary of Cash Equivalents and Marketable Securities (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 17,349 | $ 26,588 |
Marketable securities | 61,275 | 96,842 |
Total cash equivalents and marketable securities | 78,624 | 123,430 |
Money Market Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 15,802 | 22,091 |
Commercial Paper [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 998 | 2,997 |
Marketable securities | 9,951 | 27,220 |
Corporate Bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 549 | 1,500 |
Marketable securities | 50,844 | 69,622 |
Certificates of Deposit [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 480 | |
Quoted Prices in Active Markets, (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 15,802 | 22,091 |
Total cash equivalents and marketable securities | 15,802 | 22,091 |
Quoted Prices in Active Markets, (Level 1) [Member] | Money Market Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 15,802 | 22,091 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 1,547 | 4,497 |
Marketable securities | 61,275 | 96,842 |
Total cash equivalents and marketable securities | 62,822 | 101,339 |
Significant Other Observable Inputs (Level 2) [Member] | Commercial Paper [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 998 | 2,997 |
Marketable securities | 9,951 | 27,220 |
Significant Other Observable Inputs (Level 2) [Member] | Corporate Bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 549 | 1,500 |
Marketable securities | 50,844 | $ 69,622 |
Significant Other Observable Inputs (Level 2) [Member] | Certificates of Deposit [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | $ 480 |
Fair Value Measurements and M37
Fair Value Measurements and Marketable Securities - Summary of Marketable Securities (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 61,333 | $ 96,922 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (58) | (80) |
Fair Value | 61,275 | 96,842 |
Corporate Bonds (Due within 1 Year) [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 50,892 | 68,777 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (48) | (54) |
Fair Value | 50,844 | 68,723 |
Commercial Paper (Due within 1 Year) [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 9,961 | 27,244 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (10) | (24) |
Fair Value | 9,951 | 27,220 |
Corporate Bonds (Due After 1 Year Through 2 Years) [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 901 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (2) | |
Fair Value | $ 899 | |
Certificates of Deposit (Due within 1 Year) [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 480 | |
Gross Unrealized Gains | 0 | |
Fair Value | $ 480 |
Property and Equipment, Net - S
Property and Equipment, Net - Schedule of Property Plant and Equipment Net (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Useful Life | 5 years | |
Property and equipment, gross | $ 1,036 | $ 981 |
Less: Accumulated depreciation | (508) | (320) |
Property and equipment, net | $ 528 | 661 |
Office Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Useful Life | 5 years | |
Property and equipment, gross | $ 421 | 372 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Useful Life | 5 years | |
Property and equipment, gross | $ 194 | 194 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Useful Life | 5 years | |
Property and equipment, gross | $ 6 | |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 415 | $ 415 |
Property and Equipment, net - A
Property and Equipment, net - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property Plant And Equipment Capitalized Interest Costs [Abstract] | |||
Depreciation expense | $ 188 | $ 212 | $ 70 |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Payables and Accruals [Abstract] | ||
Accrued payroll and related expenses | $ 2,229 | $ 2,008 |
Accrued research and development expenses | 1,647 | 892 |
Accrued professional fees | 292 | 347 |
Accrued restructuring | 376 | |
Accrued other | 105 | 110 |
Accrued expenses | $ 4,273 | $ 3,733 |
Notes Payable - Additional Info
Notes Payable - Additional Information (Detail) - USD ($) | Dec. 29, 2017 | Dec. 31, 2017 | Dec. 29, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | |||||
Proceeds from issuance of notes payable | $ 20,000,000 | $ 20,000,000 | |||
Credit facility default amount | 300,000 | ||||
Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate value of cash maintained by Australian subsidiary, limit | 4,000,000 | ||||
Term Loan [Member] | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowings under term loan | $ 20,000,000 | 20,000,000 | $ 20,000,000 | ||
Debt facility description | Upon entering into this Term Loan, the Company was obligated to make monthly, interest-only payments until March 29, 2019 and, thereafter, to pay 33 consecutive, equal monthly installments of principal and interest from April 1, 2019 through December 1, 2021. The outstanding Term Loan bears a variable interest at an annual rate of 1.25% above the prime rate, which at December 31, 2017 was 4.5%. In addition, a final payment equal to 8.0% of the Term Loan is due upon the earlier of the maturity date, acceleration of the term loans or prepayment of all or part of the term loans. | ||||
Debt maturity date | Dec. 1, 2021 | ||||
Debt facility interest rate description | 1.25% above the prime rate | ||||
Debt facility interest rate | 1.25% | ||||
Debt facility effective interest rate | 4.50% | 4.50% | |||
Debt facility fee percentage | 8.00% | ||||
Charges to interest expense of debt outstanding | $ 1,600,000 | ||||
Debt facility effective interest rate | 8.90% | ||||
Loan agreement minimum liquidity required | $ 21,000,000 | $ 21,000,000 | $ 21,000,000 | ||
Debt facility covenant description | Further, as of 45 days after the Term Loan was entered in, the Company must maintain a balance of unrestricted cash, cash equivalents and marketable securities at Silicon Valley Bank in an amount not less than the greater of (i) $55.0 million and (ii) sixty-five percent (65%) of all the Company’s cash, cash equivalents and marketable securities. If the Company does not meet this requirement it will not be considered an event of default provided it immediately secures 87.5% of the principal balance in a restricted cash account. | ||||
Term Loan [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Percentage equivalent of cash, cash equivalents and marketable securities balance | 105.00% | ||||
2014 Credit Facility [Member] | Secured Debt [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt facility effective interest rate | 10.80% | ||||
Interest expense on credit facility | $ 200,000 | $ 500,000 | $ 800,000 |
Notes Payable - Schedule of Not
Notes Payable - Schedule of Notes Payable (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Notes payable | $ 20,000 | $ 3,183 |
Notes payable current portion | 3,589 | |
Secured Debt [Member] | Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt discount, net of accretion | (9) | |
Accretion related to final payment | $ 415 |
Notes Payable - Schedule of Est
Notes Payable - Schedule of Estimated Future Principal Payments (Detail) $ in Thousands | Dec. 31, 2017USD ($) |
Debt Instruments [Abstract] | |
2,018 | $ 0 |
2,019 | 5,454 |
2,020 | 7,273 |
2,021 | 7,273 |
Total | $ 20,000 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | Jan. 28, 2015 | Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 |
Proceeds from offering, net of commissions and underwriting discounts | $ 130,044 | |||
Payments of public offering costs | $ 473 | |||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | ||
Preferred stock, par value | $ 0.001 | $ 0.001 | ||
Common stock, shares authorized | 115,000,000 | 115,000,000 | ||
Common stock, par value | $ 0.001 | $ 0.001 | ||
Follow-on Offering [Member] | ||||
Common stock issued | 3,942,200 | |||
Common stock issued price per share | $ 35 | |||
Proceeds from offering, net of commissions and underwriting discounts | $ 130,000 | |||
Payments of public offering costs | $ 500 |
Stock-Based Awards - Additional
Stock-Based Awards - Additional Information (Detail) - USD ($) | Jan. 01, 2017 | Oct. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option modification non cash expense | $ 200,000 | ||||
Time-Based Vesting Conditions [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock based compensation, stock options granted | 1,764,874 | ||||
Aggregate intrinsic value of stock options exercised | $ 300,000 | $ 100,000 | $ 13,900,000 | ||
Proceeds from exercise of common stock options | $ 100,000 | $ 800,000 | |||
Weighted average grant-date fair value of stock options granted | $ 2.91 | $ 4.86 | $ 28.97 | ||
Aggregate intrinsic value of Price Target Options | $ 3,251,000 | $ 1,038,000 | |||
Weighted average remaining contractual term | 7 years 9 months 18 days | 7 years 2 months 12 days | |||
Time-Based Vesting Conditions [Member] | Maximum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Proceeds from exercise of common stock options | $ 100,000 | ||||
Time-Based Vesting Conditions [Member] | Non Employee [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of outstanding unvested shares held by nonemployees | 77,567 | 6,401 | |||
Time-Based Vesting Conditions [Member] | CEO [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock based compensation, stock options granted | 550,000 | ||||
Term of stock option | 10 years | ||||
Stock option vesting percentage | 25.00% | ||||
Stock option vesting description | The options vest as to 25% of the shares on the first anniversary of the grant date and the remainder in equal monthly installments thereafter over a 3-year period. | ||||
Market-Based Vesting Conditions [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock based compensation, stock options granted | 687,500 | 687,500 | |||
Weighted average fair value of Price Target Options | $ 4.56 | ||||
Total fair value of Price Target Options | $ 3,100,000 | ||||
Aggregate intrinsic value of Price Target Options | $ 800,000 | ||||
Weighted average remaining contractual term | 9 years 9 months 7 days | ||||
Market-Based Vesting Conditions [Member] | Options to Purchase Common Stock [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Term of stock option | 3 years | ||||
Market-Based Vesting Conditions [Member] | Minimum [Member] | Options to Purchase Common Stock [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares that will vest upon achievement of the target, as a percentage | 50.00% | ||||
Market-Based Vesting Conditions [Member] | Maximum [Member] | Options to Purchase Common Stock [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares that will vest upon achievement of the target, as a percentage | 200.00% | ||||
Market-Based Vesting Conditions [Member] | CEO [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock based compensation, stock options granted | 550,000 | ||||
Term of stock option | 10 years | ||||
Restricted Stock Units (RSUs) [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Aggregate intrinsic value of restricted stock units vested during the period | $ 100,000 | $ 100,000 | $ 100,000 | ||
Weighted average grant-date fair value of restricted stock units granted | $ 4.18 | $ 7.91 | $ 34.46 | ||
Number of restricted stock units granted | 22,128 | 13,273 | 4,769 | ||
Number of restricted stock units unvested | 0 | 0 | |||
Time Based Options [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized stock-based compensation cost | $ 10,700,000 | ||||
Stock-based compensation recognized weighted average period | 2 years 6 months 14 days | ||||
Market Based Stock Option [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized stock-based compensation cost | $ 3,100,000 | ||||
Stock-based compensation recognized weighted average period | 2 years 9 months 7 days | ||||
2014 Stock Option and Incentive Plan [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares of common stock reserved for issuance | 2,168,221 | ||||
Percentage of outstanding shares of common stock | 4.00% | ||||
Common stock available for issuance | 1,981,060 | ||||
Shares added to plan | 1,093,302 | ||||
2014 Stock Option and Incentive Plan [Member] | Time-Based Vesting Conditions [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock based compensation, stock options granted | 1,214,874 | 1,527,559 | 992,505 | ||
2014 Stock Option and Incentive Plan [Member] | Time-Based Vesting Conditions [Member] | Minimum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Term of stock option | 3 years | ||||
2014 Stock Option and Incentive Plan [Member] | Time-Based Vesting Conditions [Member] | Maximum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Term of stock option | 4 years | ||||
2014 Stock Option and Incentive Plan [Member] | Market-Based Vesting Conditions [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock based compensation, stock options granted | 137,500 | ||||
2014 Employee Stock Purchase Plan [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares of common stock reserved for issuance | 265,000 | ||||
Common stock available for issuance | 176,016 | 219,797 | |||
Commencement date of first offering period | Jan. 1, 2017 | Jan. 1, 2016 | |||
End date of first offering period | Jun. 30, 2017 | Jun. 30, 2016 | |||
Commencement date of second offering period | Jul. 1, 2017 | Jul. 1, 2016 | |||
End date of second offering period | Dec. 31, 2017 | Dec. 31, 2016 | |||
Stock-based awards, shares | 43,781 | 37,663 | |||
2014 Employee Stock Purchase Plan [Member] | Maximum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Discount from market price of the company's common stock offering | 85.00% |
Stock-Based Awards - Assumption
Stock-Based Awards - Assumptions used to Determine Fair Value of Stock Options Granted (Detail) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Time-Based Vesting Conditions [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 2.10% | 1.40% | 1.75% |
Expected term (in years) | 6 years 2 months 1 day | 6 years 2 months 5 days | 6 years 3 months |
Expected volatility | 93.00% | 87.00% | 87.00% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Market-Based Vesting Conditions [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 2.24% | ||
Expected term (in years) | 6 years 3 months 19 days | ||
Expected volatility | 94.60% | ||
Expected dividend yield | 0.00% |
Stock-Based Awards - Summary 47
Stock-Based Awards - Summary of Stock Option Activity (Detail) - Time-Based Vesting Conditions [Member] - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares issuable under options, beginning balance | 3,115,003 | |
Shares issuable under options, granted | 1,764,874 | |
Shares issuable under options, exercised | (93,211) | |
Shares issuable under options, forfeited | (292,465) | |
Shares issuable under options, ending balance | 4,494,201 | 3,115,003 |
Shares issuable under options, options vested and expected to vest | 4,494,201 | |
Shares issuable under options, options exercisable | 2,088,452 | |
Weighted-average exercise price, beginning balance | $ 14.40 | |
Weighted-average exercise price, granted | 3.88 | |
Weighted-average exercise price, exercised | 0.80 | |
Weighted-average exercise price, forfeited | 20.97 | |
Weighted-average exercise price, ending balance | 10.12 | $ 14.40 |
Weighted-average exercise price, options vested and expected to vest | 10.12 | |
Weighted-average exercise price, options exercisable | $ 13.44 | |
Average remaining contractual life | 7 years 9 months 18 days | 7 years 2 months 12 days |
Average remaining contractual life, options vested and expected to vest | 7 years 9 months 18 days | |
Average remaining contractual life, options exercisable | 6 years 4 months 24 days | |
Aggregate intrinsic value | $ 3,251 | $ 1,038 |
Aggregate intrinsic value, options vested and expected to vest | 3,251 | |
Aggregate intrinsic value, options exercisable | $ 1,955 |
Net Loss Per Share - Computatio
Net Loss Per Share - Computation of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Numerator: | |||||||||||
Net loss | $ (52,028) | $ (57,878) | $ (74,286) | ||||||||
Denominator: | |||||||||||
Weighted average common shares outstanding, basic and diluted | 27,489,397 | 27,483,550 | 27,407,408 | 27,350,673 | 27,332,515 | 27,322,907 | 27,272,225 | 27,263,435 | 27,433,239 | 27,297,934 | 26,756,079 |
Net loss per share, basic and diluted | $ (0.48) | $ (0.46) | $ (0.49) | $ (0.48) | $ (0.38) | $ (0.54) | $ (0.55) | $ (0.65) | $ (1.90) | $ (2.12) | $ (2.78) |
Net Loss Per Share - Summary of
Net Loss Per Share - Summary of Common Stock Equivalents Outstanding (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Options to Purchase Common Stock [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total potentially dilutive shares | 4,494,201 | 3,115,003 | 2,555,110 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | Jan. 01, 2017ft² | Oct. 01, 2015 | Apr. 15, 2015Option | Jul. 28, 2014 | Jan. 31, 2017 | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Other Commitments [Line Items] | ||||||||
Operating lease, rental expense | $ 300,000 | $ 400,000 | $ 300,000 | |||||
Subsequent Licensed Product [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Licensing fees per product maximum | 1,300,000 | |||||||
Development Based Milestones [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Milestone payments due | $ 0 | $ 0 | $ 0 | |||||
Boston Office Space [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Lease expiration date | Jul. 31, 2017 | Jul. 31, 2020 | Jul. 31, 2020 | |||||
Lease extension period | 3 years | |||||||
Boston Office Space [Member] | Unrelated Third Party Member | ||||||||
Other Commitments [Line Items] | ||||||||
Subleased area | ft² | 2,976 | |||||||
Sublease expiration date | Dec. 31, 2018 | |||||||
Sublease rental income | $ 200,000 | |||||||
Additional Boston Office Space [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Lease expiration date | Jul. 31, 2017 | Jul. 31, 2020 | ||||||
Lease extension period | 3 years | |||||||
Number of options to extend lease | Option | 2 | |||||||
San Diego Office Space [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Lease expiration date | Sep. 30, 2019 | |||||||
Lease extension period | 5 years | |||||||
Maximum [Member] | Pre Commercialization Milestones [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Milestone payments | $ 12,300,000 | |||||||
Maximum [Member] | Product Commercialization Milestones [Member] | ||||||||
Other Commitments [Line Items] | ||||||||
Milestone payments | $ 12,500,000 |
Commitments and Contingencies51
Commitments and Contingencies - Schedule of Future Minimum Lease Payments for Operating Leases (Detail) $ in Thousands | Dec. 31, 2017USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,018 | $ 479 |
2,019 | 464 |
2,020 | 226 |
2,021 | 0 |
Total | $ 1,169 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Taxes Disclosure [Line Items] | ||||
Income tax benefit | $ 0 | $ 0 | $ 0 | |
Operating loss carryforwards, federal | 14,800,000 | |||
Operating loss carry forwards, state | 2,400,000 | |||
Uncertain tax position | 0 | |||
Capitalized research and development expenses | 49,325,000 | 59,489,000 | ||
Gross deferred tax assets | 87,681,000 | 97,720,000 | ||
Unrecognized tax benefits | $ 0 | $ 0 | ||
Federal statutory income tax rate | 34.00% | 34.00% | 34.00% | |
Tax Cuts and Jobs Act, Incomplete Accounting, Change in Tax Rate, Deferred Tax Liability, Provisional Income Tax Benefit | $ 33,800,000 | |||
Tax cuts and jobs act of 2017, net operating losses carryforward, maximum percentage of taxable income | 80.00% | |||
Accounting Standards Update 2016-09 [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Operating loss carryforwards, federal | $ 9,400,000 | |||
Operating loss carry forwards, state | 7,200,000 | |||
Capitalized research and development expenses | 3,400,000 | |||
Scenario, Plan [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Federal statutory income tax rate | 21.00% | |||
Domestic Tax Authority [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Net operating loss carryforwards | $ 54,000,000 | |||
Net operating loss carryforwards, beginning of expiration period | 2,026 | |||
Research and development tax credit carry forwards, beginning of expiration period | 2,026 | |||
State and Local Jurisdiction [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Net operating loss carryforwards | $ 39,600,000 | |||
Net operating loss carryforwards, beginning of expiration period | 2,030 | |||
Research and development tax credit carry forwards, beginning of expiration period | 2,021 |
Income Taxes - Schedule of Dome
Income Taxes - Schedule of Domestic and Foreign Components of Loss Before Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (49,954) | $ (57,799) | $ (72,147) |
Foreign | (2,074) | (79) | (2,139) |
Loss before income taxes | $ (52,028) | $ (57,878) | $ (74,286) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Federal Statutory Income Tax Rate (Detail) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory income tax rate | (34.00%) | (34.00%) | (34.00%) |
Federal and state research and development tax credit | (4.10%) | (2.90%) | (3.90%) |
State taxes, net of federal benefit | (2.40%) | (3.90%) | (3.90%) |
Orphan drug tax credit | (0.00%) | (1.30%) | (3.50%) |
Stock compensation expense | 1.50% | 0.70% | 0.90% |
Nondeductible Australia research and development expenses | 1.40% | 0.00% | 1.00% |
Impact of federal rate change related to tax reform | 65.20% | 0.00% | 0.00% |
Other items | 1.20% | 1.30% | 0.10% |
Change in deferred tax asset valuation allowance | (28.80%) | 40.10% | 43.30% |
Effective income tax rate | 0.00% | 0.00% | 0.00% |
Income Taxes - Schedule of Net
Income Taxes - Schedule of Net Deferred Tax Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Noncurrent deferred tax assets: | ||||
Capitalized research and development expenses | $ 49,325 | $ 59,489 | ||
Net operating loss carryforwards | 13,848 | 14,991 | ||
Tax credit carryforwards | 16,759 | 14,297 | ||
Capitalized legal expenses | 1,646 | 2,119 | ||
Stock-based compensation | 5,568 | 6,027 | ||
Accrued expenses | 522 | 783 | ||
Other temporary differences | 13 | 14 | ||
Total noncurrent deferred tax assets | 87,681 | 97,720 | ||
Total gross deferred tax assets | 87,681 | 97,720 | ||
Valuation allowance | (87,681) | (97,720) | $ (74,541) | $ (42,398) |
Net deferred tax assets | $ 0 | $ 0 |
Income Taxes - Summary of Chang
Income Taxes - Summary of Changes in the Valuation Allowance for Deferred Tax Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Valuation allowance as of beginning of year | $ 97,720 | $ 74,541 | $ 42,398 |
Decreases recorded as benefit to income tax provision | (10,039) | ||
Increases recorded to income tax provision | 23,179 | 32,143 | |
Valuation allowance as of end of year | $ 87,681 | $ 97,720 | $ 74,541 |
Retirement Plan - Additional In
Retirement Plan - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Retirement Benefits [Abstract] | |||
Percentage of employer's contribution on employee's base salary | 2.00% | ||
Contribution expense | $ 0.1 | $ 0.2 | $ 0.1 |
Australia Research and Develo58
Australia Research and Development Tax Incentive - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Research and Development Tax Incentive [Line Items] | |||
Unrealized foreign currency transaction gains (losses) | $ 46,000 | $ (6,000) | $ (82,000) |
Research and Development [Member] | |||
Research and Development Tax Incentive [Line Items] | |||
Percentage of reduction in research and development costs | 43.50% | 45.00% | 45.00% |
Zafgen Australia Pty Limited [Member] | |||
Research and Development Tax Incentive [Line Items] | |||
Unrealized foreign currency transaction gains (losses) | $ (100,000) | ||
Zafgen Australia Pty Limited [Member] | Australia [Member] | |||
Research and Development Tax Incentive [Line Items] | |||
Tax incentive receivable | $ 900,000 | $ 300,000 | |
Zafgen Australia Pty Limited [Member] | Research and Development [Member] | |||
Research and Development Tax Incentive [Line Items] | |||
Percentage of refundable tax incentive | 43.50% | ||
Reduction to research and development expenses | $ 900,000 | 300,000 | $ 1,400,000 |
Zafgen Australia Pty Limited [Member] | Maximum [Member] | |||
Research and Development Tax Incentive [Line Items] | |||
Unrealized foreign currency transaction gains (losses) | $ 100,000 | $ (100,000) |
Restructuring - Additional Info
Restructuring - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended |
Dec. 31, 2016 | Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | ||
Percentage of workforce reduction | 31.00% | |
Restructuring charges | $ 1.4 | |
Stock option modification non cash expense | $ 0.2 |
Restructuring - Summary of Rest
Restructuring - Summary of Restructuring Costs by Category (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Restructuring Reserve Disclosures [Abstract] | |
Restructuring costs | $ 1,403 |
Research and Development [Member] | |
Restructuring Reserve Disclosures [Abstract] | |
Restructuring costs | 462 |
General and Administrative [Member] | |
Restructuring Reserve Disclosures [Abstract] | |
Restructuring costs | 941 |
Cash [Member] | |
Restructuring Reserve Disclosures [Abstract] | |
Restructuring costs | 1,223 |
Cash [Member] | Research and Development [Member] | |
Restructuring Reserve Disclosures [Abstract] | |
Restructuring costs | 455 |
Cash [Member] | General and Administrative [Member] | |
Restructuring Reserve Disclosures [Abstract] | |
Restructuring costs | 768 |
Non-Cash [Member] | |
Restructuring Reserve Disclosures [Abstract] | |
Restructuring costs | 180 |
Non-Cash [Member] | Research and Development [Member] | |
Restructuring Reserve Disclosures [Abstract] | |
Restructuring costs | 7 |
Non-Cash [Member] | General and Administrative [Member] | |
Restructuring Reserve Disclosures [Abstract] | |
Restructuring costs | $ 173 |
Restructuring - Summary of Re61
Restructuring - Summary of Restructuring Reserve (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Restructuring Reserve [Abstract] | ||
Restructuring reserve beginning balance | $ 376 | |
Restructuring expenses incurred during the period | 24 | $ 1,223 |
Amounts paid during the period | $ (400) | (847) |
Restructuring reserve ending balance | $ 376 |
Quarterly Financial Data - Sche
Quarterly Financial Data - Schedule of Unaudited Consolidated Financial Statements (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 |
Operating expenses | 13,358 | 12,840 | 13,536 | 13,265 | 10,475 | 14,831 | 15,062 | 17,857 | $ 52,999 | $ 58,225 | $ 73,813 |
Net loss | $ (13,085) | $ (12,585) | $ (13,347) | $ (13,011) | $ (10,439) | $ (14,675) | $ (15,028) | $ (17,736) | |||
Net loss per share, basic and diluted | $ (0.48) | $ (0.46) | $ (0.49) | $ (0.48) | $ (0.38) | $ (0.54) | $ (0.55) | $ (0.65) | $ (1.90) | $ (2.12) | $ (2.78) |
Weighted average common shares outstanding, basic and diluted | 27,489,397 | 27,483,550 | 27,407,408 | 27,350,673 | 27,332,515 | 27,322,907 | 27,272,225 | 27,263,435 | 27,433,239 | 27,297,934 | 26,756,079 |