Dicerna Pharmaceuticals (DRNA) 10-Q 10 May 19 2019 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	May 06, 2019
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1
Trading Symbol	DRNA
Entity Registrant Name	DICERNA PHARMACEUTICALS INC
Entity Central Index Key	0001399529
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Common Stock, Shares Outstanding		68,323,979

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
CURRENT ASSETS:
Cash and cash equivalents	$ 160,141	$ 54,239
Held-to-maturity investments	211,063	248,387
Contract receivables	0	100,000
Prepaid expenses and other current assets	2,160	2,888
Total current assets	373,364	405,514
NONCURRENT ASSETS:
Property and equipment, net	3,971	2,718
Right-of-use asset	3,047
Restricted cash equivalents	3,544	744
Other noncurrent assets	63	65
Total noncurrent assets	10,625	3,527
TOTAL ASSETS	383,989	409,041
CURRENT LIABILITIES:
Accounts payable	4,958	5,013
Accrued expenses and other current liabilities	8,196	9,649
Lease liability, current portion	1,750
Litigation settlement payable	0	10,500
Current portion of deferred revenue	59,784	68,893
Total current liabilities	74,688	94,055
NONCURRENT LIABILITIES:
Lease liability, noncurrent	1,378
Deferred revenue, net of current portion	128,295	114,293
Total noncurrent liabilities	129,673	114,293
TOTAL LIABILITIES	204,361	208,348
COMMITMENTS AND CONTINGENCIES (NOTE 8)
STOCKHOLDERS’ EQUITY:
Preferred stock, $0.0001 par value – 5,000,000 shares authorized; no shares issued or outstanding at March 31, 2019 or December 31, 2018	0	0
Common stock, $0.0001 par value – 150,000,000 shares authorized; 68,288,906 and 68,210,742 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively	7	7
Additional paid-in capital	610,632	605,495
Accumulated deficit	(431,011)	(404,809)
Total stockholders’ equity	179,628	200,693
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$ 383,989	$ 409,041

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares	Mar. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	5,000,000	5,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	150,000,000	150,000,000
Common stock, shares issued (in shares)	68,288,906	68,210,742
Common stock, shares outstanding (in shares)	68,288,906	68,210,742

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Total	COMMON STOCK	ADDITIONAL PAID-IN CAPITAL	ACCUMULATED DEFICIT
Balance at beginning of period (in shares) at Dec. 31, 2017		51,644,841
Balance at beginning of period at Dec. 31, 2017	$ 101,086	$ 5	$ 417,037	$ (315,956)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercises of common stock options and sales of common stock under Employee Stock Purchase Plan (in shares)		130,362
Exercises of common stock options and sales of common stock under Employee Stock Purchase Plan	632		632
Vesting of restricted common stock (in shares)		10,000
Vesting of restricted common stock	0
Settlement of restricted stock for tax withholding (in shares)		(3,774)
Settlement of restricted stock for tax withholding	0
Stock-based compensation expense (inclusive of the impact of adoption of ASU 2018-07)	1,747		1,747
Net loss	(15,579)			(15,579)
Balance at end of period (in shares) at Mar. 31, 2018		51,781,429
Balance at end of period at Mar. 31, 2018	87,886	$ 5	419,416	(331,535)
Balance at beginning of period (in shares) at Dec. 31, 2018		68,210,742
Balance at beginning of period at Dec. 31, 2018	200,693	$ 7	605,495	(404,809)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercises of common stock options and sales of common stock under Employee Stock Purchase Plan (in shares)		78,164
Exercises of common stock options and sales of common stock under Employee Stock Purchase Plan	353		353
Stock-based compensation expense (inclusive of the impact of adoption of ASU 2018-07)	4,827		4,784	43
Net loss	(26,154)			(26,154)
Balance at end of period (in shares) at Mar. 31, 2019		68,288,906
Balance at end of period at Mar. 31, 2019	$ 179,628	$ 7	$ 610,632	$ (431,011)

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Income Statement [Abstract]
Revenue from collaborative arrangements	$ 3,107	$ 1,545
Operating expenses:
Research and development	21,603	9,893
General and administrative	9,676	4,335
Litigation expense	0	3,184
Total operating expenses	31,279	17,412
Loss from operations	(28,172)	(15,867)
Interest income	2,018	288
Net loss	$ (26,154)	$ (15,579)
Net loss per share – basic and diluted (in dollars per share)	$ (0.38)	$ (0.30)
Weighted average common shares outstanding – basic and diluted (in shares)	68,259,354	51,723,349

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (26,154)	$ (15,579)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense	4,827	1,747
Depreciation and amortization expense	242	195
Amortization of premium on investments	(1,225)	(90)
Lease expense	445
Changes in operating assets and liabilities:
Litigation settlement payable	(10,500)	0
Deferred revenue	4,893	(1,545)
Prepaid expenses and other assets	886	1,004
Accounts payable	1,064	(2,895)
Contract receivables	100,000	0
Accrued expenses and other liabilities	(1,735)	712
Lease liability	(456)
Net cash provided by (used in) operating activities	72,287	(16,451)
CASH FLOWS FROM INVESTING ACTIVITIES:
Maturities of held-to-maturity investments	88,000	20,000
Purchases of held-to-maturity investments	(49,451)	(29,790)
Purchases of property and equipment	(2,280)	(134)
Net cash provided by (used in) investing activities	36,269	(9,924)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments of common stock offering costs	(50)	0
Proceeds from exercises of common stock warrants, stock options and issuances under Employee Stock Purchase Plan	196	667
Settlement of restricted stock for tax withholding	0	(35)
Net cash provided by financing activities	146	632
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH EQUIVALENTS	108,702	(25,743)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH EQUIVALENTS – Beginning of period	54,983	69,533
CASH, CASH EQUIVALENTS AND RESTRICTED CASH EQUIVALENTS – End of period	163,685	43,790
NONCASH OPERATING ACTIVITIES
Right-of-use assets acquired through operating leases	667
NONCASH INVESTING ACTIVITIES
Property and equipment purchases included in accounts payable and accrued expenses	863	0
Total cash, cash equivalents, and restricted cash equivalents shown in the consolidated statements of cash flows	$ 54,983	$ 69,533

DESCRIPTION OF BUSINESS AND BAS

DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION	3 Months Ended
	Mar. 31, 2019
Accounting Policies [Abstract]
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION	DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Business Dicerna Pharmaceuticals, Inc. (“Dicerna” or the “Company”), a Delaware corporation founded in 2006 and headquartered in Cambridge, Massachusetts, is a biopharmaceutical company focused on the discovery and development of innovative subcutaneously delivered ribonucleic acid (“RNA”) interference (“RNAi”)-based pharmaceuticals using its GalXC RNAi platform for the treatment of diseases involving the liver, including rare diseases, viral infectious diseases, chronic liver diseases, and cardiovascular diseases. Within these therapeutic areas, the Company believes its GalXC RNAi platform will allow the Company to build a broad pipeline of therapeutics with attractive pharmaceutical properties, including a subcutaneous route of administration, infrequent dosing (e.g., dosing that is monthly or quarterly, and potentially even less frequent), high therapeutic index, and specificity to a single target gene. Basis of presentation These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information, and include the accounts of Dicerna Pharmaceuticals, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The year-end condensed balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP to constitute a complete set of financial statements. These condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position at March 31, 2019 and results of operations and cash flows for the interim periods ended March 31, 2019 and 2018. These unaudited condensed consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. The results of the three months ended March 31, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019 or for any other interim period or for any other future year. Significant judgments and estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the Company’s condensed consolidated financial statements, as well as the revenues and expenses incurred during the reporting periods. On an ongoing basis, the Company evaluates judgments and estimates, including those related to revenue recognition and accrued expenses. The Company bases its estimates on historical experience and on various other factors that the Company believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not apparent from other sources. Changes in estimates are reflected in reported results for the period in which they become known. Actual results could differ materially from those estimates. Summary of Significant Accounting Policies There have been no changes to the significant accounting policies disclosed in the Company’s most recent Annual Report on Form 10‑K, except as a result of adopting the Financial Accounting Standards Board (“FASB”)’s Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842), as discussed below: Leases The Company determines if an arrangement is a lease at inception. Leases with a term greater than one year are presented on the balance sheet as right-of-use (“ROU”) assets, lease liabilities and, if applicable, long-term lease liabilities. The Company has elected not to recognize on the balance sheet leases with terms of one year or less. At the commencement date, operating lease liabilities and their corresponding ROU assets are recorded based on the present value of future lease payments over the expected lease term. Certain adjustments to the ROU asset may be required for items such as initial direct costs paid or incentives received. Operating lease cost is recognized over the expected term on a straight-line basis. Recent Accounting Pronouncement Adopted in 2019 Leases In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), as amended by multiple standards updates, in order to increase transparency and comparability among organizations by requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. The most significant change arising from the new standard is the recognition of ROU assets and lease liabilities for leases classified as operating leases. Under the standard, disclosures are required to enable financial statement users to assess the amount, timing, and uncertainty of cash flows arising from the leases. Companies are also required to recognize and measure leases existing at, or entered into after, the adoption date using a modified retrospective approach, with certain practical expedients available. Comparative periods prior to adoption have not been retrospectively adjusted. The Company adopted the standard effective January 1, 2019 and elected the package of three practical expedients that permitted an entity to a) not reassess whether expired or existing contracts contain leases, b) not reassess lease classification for existing or expired leases, and c) not consider whether previously capitalized initial direct costs would be appropriate under the new standard. Upon adoption, the Company recorded ROU assets of $2.7 million and lease liabilities of $2.8 million . The standard did not have a material impact on the statement of operations or statement of cash flows.

NET LOSS PER SHARE

NET LOSS PER SHARE	3 Months Ended
	Mar. 31, 2019
Earnings Per Share [Abstract]
NET LOSS PER SHARE	NET LOSS PER SHARE The Company computes basic net loss per common share by dividing net loss by the weighted average number of common shares outstanding. In periods of net income, the Company’s accounting policy includes allocating a proportional share of net income to participating securities, as determined by dividing total weighted average participating securities by the sum of the total weighted average common shares and participating securities (the “two-class method”). Participating securities have the effect of diluting both basic and diluted earnings per share during periods of income. During periods when the Company incurs a net loss, the Company does not allocate a loss to participating securities because they have no contractual obligation to share in the losses of the Company. The Company computes diluted net loss per common share after giving consideration to the dilutive effect of stock options, warrants, nonvested restricted stock, and redeemable convertible preferred shares that are outstanding during the period, except where such non-participating securities would be anti-dilutive. The outstanding securities presented below were excluded from the calculation of net loss per share, because such securities would have been anti-dilutive due to the Company’s net loss per share during the periods ending on the dates presented. Three Months Ended 2019 2018 Options to purchase common stock 11,191,789 7,171,978 Warrants to purchase common stock 2,198 87,901 Total 11,193,987 7,259,879

HELD-TO-MATURITY INVESTMENTS

HELD-TO-MATURITY INVESTMENTS	3 Months Ended
	Mar. 31, 2019
Investments, Debt and Equity Securities [Abstract]
HELD-TO-MATURITY INVESTMENTS	HELD-TO-MATURITY INVESTMENTS The Company invests its excess cash balances in short-term and long-term fixed-income investments. The Company determines the appropriate classification of investments at the time of purchase and re-evaluates such designation as of each balance sheet date. Debt securities carried at amortized cost are classified as held-to-maturity when the Company has the positive intent and ability to hold the securities to maturity. The Company’s investment policy mandates that, at the time of purchase, the maturity of each investment within its portfolio shall not exceed 24 months . In addition, the weighted‑average maturity of the investment portfolio must not exceed 12 months . The following tables provide information relating to the Company’s held-to-maturity investments: MARCH 31, 2019 DESCRIPTION AMORTIZED COST GROSS UNREALIZED GAINS GROSS LOSSES FAIR VALUE U.S. Treasury securities maturing in one year or less $ 211,063 $ 24 $ (4 ) $ 211,083 DECEMBER 31, 2018 DESCRIPTION AMORTIZED COST GROSS UNREALIZED GAINS GROSS LOSSES FAIR VALUE U.S. Treasury securities maturing in one year or less $ 248,387 $ — $ (43 ) $ 248,344

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	3 Months Ended
	Mar. 31, 2019
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENTS	FAIR VALUE MEASUREMENTS Fair value is an exit price, representing the amount that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Valuation techniques used to measure fair value are performed in a manner to maximize the use of observable inputs and minimize the use of unobservable inputs. As a basis for considering such assumptions, the accounting literature establishes a three-tier value hierarchy which prioritizes the inputs used in measuring fair value as follows: • Level 1 – observable inputs, such as quoted prices in active markets; • Level 2 – inputs other than the quoted prices in active markets that are observable either directly or indirectly; and • Level 3 – unobservable inputs for which there is little or no market data, which requires the Company to develop its own assumptions. A summary of the Company’s assets that are measured or disclosed at fair value on a recurring basis is presented below: MARCH 31, 2019 DESCRIPTION TOTAL FAIR VALUE LEVEL 1 LEVEL 2 LEVEL 3 Cash equivalents Money market funds $ 160,908 $ 160,908 $ — $ — Held-to-maturity investments U.S. Treasury securities 211,083 — 211,083 — Restricted cash equivalents Money market funds 3,544 — 3,544 — Total $ 375,535 $ 160,908 $ 214,627 $ — DECEMBER 31, 2018 DESCRIPTION TOTAL FAIR VALUE LEVEL 1 LEVEL 2 LEVEL 3 Cash equivalents Money market funds $ 44,886 $ 44,886 $ — $ — Held-to-maturity investments U.S. Treasury securities 248,344 — 248,344 — Restricted cash equivalents Money market funds 744 — 744 — Total $ 293,974 $ 44,886 $ 249,088 $ — The Company’s cash equivalents, which are in money market funds, are classified within Level 1 of the fair value hierarchy because they are valued using quoted prices in active markets as of March 31, 2019 and December 31, 2018 . The Company’s held-to-maturity investments and restricted cash equivalents bore interest at the prevailing market rates for instruments with similar characteristics and therefore approximated fair value. These financial instruments were classified within Level 2 of the fair value hierarchy because the inputs to the fair value measurement are valued using observable inputs as of March 31, 2019 and December 31, 2018 . As of March 31, 2019 and December 31, 2018 , the Company’s contract receivables, accounts payable, and accrued expenses approximated their estimated fair values because of the short-term nature of these financial instruments. As of December 31, 2018 , the Company had a remaining cash obligation of $10.5 million payable to Alnylam (see Note 8 ) upon receipt of the upfront cash payment owed to the Company resulting from signing the Lilly Collaboration Agreement. As the present value of the litigation settlement payable at December 31, 2018 was determined using market rates based on the nature of the obligation and the Company’s creditworthiness, the carrying value approximates the fair value. The Company paid the remaining outstanding balance of litigation settlement payable in full in January 2019. It is the Company’s policy to recognize transfers between levels of the fair value hierarchy, if any, at the end of the reporting period; however, there have been no such transfers during any of the periods presented.

COLLABORATIVE RESEARCH AND LICE

COLLABORATIVE RESEARCH AND LICENSE AGREEMENTS	3 Months Ended
	Mar. 31, 2019
Revenue from Contract with Customer [Abstract]
COLLABORATIVE RESEARCH AND LICENSE AGREEMENTS	COLLABORATIVE LICENSE AGREEMENTS Lilly collaboration and share purchase agreements On October 25, 2018, the Company entered into a Collaboration and License Agreement (the “Lilly Collaboration Agreement”) with Lilly for the discovery, development, and commercialization of potential new medicines in the areas of cardiometabolic disease, neurodegeneration, and pain. Under the terms of the Lilly Collaboration Agreement, the Company and Lilly will seek to use the Company’s proprietary GalXC RNAi technology platform to progress new drug targets toward clinical development and commercialization. In addition, the Company and Lilly will collaborate to extend the GalXC RNAi platform technology to non-liver (i.e., non-hepatocyte) tissues, including neural tissues. The Lilly Collaboration Agreement provides that the Company will work exclusively with Lilly in the neurodegeneration and pain fields, with the exception of mutually agreed upon orphan indications. Additionally, the Company will work exclusively with Lilly on select targets in the cardiometabolic field. Under the Lilly Collaboration Agreement, the Company will provide Lilly with exclusive and non-exclusive licenses to support the companies’ activities and to enable Lilly to commercialize products derived from or containing compounds developed pursuant to such agreement. The Lilly Collaboration Agreement provides for three initially named hepatocyte targets, and the Company and Lilly have agreed to develop an initial research program with the goal of researching and developing multiple lead candidates directed to each of these initial targets. The Lilly Collaboration Agreement contemplates in excess of 10 targets. Under the terms of the Lilly Collaboration Agreement, Lilly agreed to pay the Company a non-refundable, non-creditable upfront payment of $100.0 million . The Company is also eligible to receive up to $350.0 million , per target, in development and commercialization milestones, in addition to a $5.0 million payment, which will become due for each of the non-hepatocyte targets when a product candidate achieves proof of principle in an animal model. In addition, the Company is eligible to earn mid-single to low-double digit royalties on product sales on a country-by-country and product-by-product basis until the later of expiration of patent rights in a country, the expiration of data or regulatory exclusivity in such country, or 10 years after the first product sale in such country, subject to certain royalty step-down provisions set forth in the agreement. Simultaneously with the entry into the Lilly Collaboration Agreement, the Company and Lilly entered into a Share Purchase Agreement (the “Lilly Share Issuance Agreement”), pursuant to which Lilly purchased 5,414,185 shares of the Company’s common stock at $18.47 per share, for an aggregate purchase price of $100.0 million . Management concluded that the Lilly Share Issuance Agreement is to be combined with the Lilly Collaboration Agreement (together, the “Combined Agreements”) for accounting purposes. Of the total $200.0 million upfront compensation, the Company applied equity accounting guidance to measure the $51.3 million recorded in equity upon the issuance of the shares, and $148.7 million was identified as the transaction price allocated to the revenue arrangement. The Combined Agreements were subject to customary closing conditions and clearances, including clearance under the Hart-Scott-Rodino Antitrust Improvements Act, and closed in December 2018. The Company concluded that Lilly is a customer in this arrangement, and as such, the element of the arrangement unrelated to the issuance of the shares falls within the scope of the revenue recognition guidance. The Company identified contract promises under the Combined Agreements for licenses of intellectual property and know-how rights, associated research and development services for targets and for a new platform, and participation on a joint steering committee. The Company d etermined that the performance obligations were not separately identifiable and were not distinct or distinct within the context of the contract due to the specialized nature of the services to be provided by Dicerna, specifically with respect to the Company’s therapeutic expertise related to RNAi and the Company’s GalXC conjugates, and the interdependent relationship between the performance obligations. As such, the Company concluded that there is a single identified combined performance obligation. The Company used the most likely amount method to estimate variable consideration and estimated that the most likely amount for each potential development milestone payment under this agreement, which is considered variable consideration, was zero , as the achievement of those milestones is uncertain and highly susceptible to factors outside of the Company’s control. Accordingly, all such milestones were excluded from the transaction price. Management will re-evaluate the transaction price at the end of each reporting period and as uncertain events are resolved or other changes in circumstances occur and adjust the transaction price as necessary. Sales-based royalties, including milestone payments based on the level of sales, were also excluded from the transaction price, as the license is deemed to be the predominant item to which the royalties relate. The Company will recognize such revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). Revenue associated with the performance obligation will be recognized as services are provided using a cost-to-cost measure of progress method. The transfer of control occurs over time and, in management’s judgment, this input method is the best measure of progress towards satisfying the performance obligation and reflects a faithful depiction of the transfer of goods and services. The Company recognized $0.5 million of revenue under the Lilly Collaboration Agreement during the three months ended March 31, 2019. The amount of the Company’s partially unsatisfied performance obligation, recorded as a contract liability presented in deferred revenue at March 31, 2019, is $148.1 million , of which $46.1 million is included in the current portion of deferred revenue. As of March 31, 2019, the Company expected to recognize this amount over the remaining research term of the agreement, which is expected to extend through the first quarter of 2022, with the majority being recognized through the fourth quarter of 2021. Alexion collaboration and equity agreements On October 22, 2018, the Company and Alexion Pharma Holding Unlimited Company (“Alexion Pharma Holding”), an affiliate of Alexion Pharmaceuticals, Inc. (“Alexion Pharmaceuticals” and, together with Alexion Pharma Holding, “Alexion”) entered into a Collaborative Research and License Agreement (the “Alexion Collaboration Agreement”). The Alexion Collaboration Agreement is for the joint discovery and development of RNAi therapies for complement-mediated diseases. Under the terms of the Alexion Collaboration Agreement, the Company and Alexion will collaborate on the discovery and development of subcutaneously delivered GalXC candidates, currently in preclinical development, for the treatment of complement-mediated diseases with potential global commercialization by Alexion. The Company will lead the joint discovery and research efforts through the preclinical stage, and Alexion will lead development efforts beginning with Phase 1 studies. The Company will be responsible for manufacturing of the GalXC candidates through the completion of Phase 1, and the related costs will be paid by Alexion. Alexion will be solely responsible for the manufacturing of any product candidate subsequent to the completion of Phase 1. The Alexion Collaboration Agreement provides Alexion with exclusive worldwide licenses as well as development and commercial rights for two of the Company’s preclinical, subcutaneously delivered GalXC RNAi candidates and an exclusive option for the discovery and development of GalXC RNAi candidates against two additional complement pathway targets. Under the terms of the Alexion Collaboration Agreement, Alexion agreed to pay the Company a non-refundable, non-reimbursable, and non-creditable upfront payment of $22.0 million . The Alexion Collaboration Agreement also provides for potential additional payments to the Company of up to $600.0 million from proceeds from target option exercises and development and sales milestones, as defined in the agreement, which is comprised of: (i) option exercise fees of up to $20.0 million , representing $10.0 million for each of the targets selected; (ii) development milestones of up to $105.0 million for each product; and (iii) aggregate sales milestones of up to $160.0 million . Under the agreement, Alexion also agreed to pay to the Company mid-single to low-double digit royalties on potential product sales on a country-by-country, product-by-product basis until the later of the expiration of patent rights in a country, the expiration of market or regulatory exclusivity in such country, or 10 years after the first product sale in such country, subject to certain royalty step-down provisions set forth in the agreement. Simultaneously with the entry into the Alexion Collaboration Agreement, the Company and Alexion Pharmaceuticals entered into a Share Purchase Agreement (the “Alexion Share Issuance Agreement”), pursuant to which Alexion Pharmaceuticals purchased 835,834 shares of the Company’s common stock at $17.95 per share at issuance, for an aggregate stated purchase price of $15.0 million . Management concluded that the Alexion Share Issuance Agreement is to be combined with the Alexion Collaboration Agreement (together, the “Alexion Agreements”) for accounting purposes. With respect to the $15.0 million of cash received upon issuance of the shares, the Company applied equity accounting guidance to measure the $9.1 million recorded in equity upon the issuance of the shares, and the remaining $5.9 million was included as a component of the transaction price attributable to the revenue arrangement. Alexion selected two targets upon entry into the Alexion Collaboration Agreement, which, as noted above, provides Alexion with the option to select up to two additional targets, in exchange for an option fee payment of $10.0 million for each selected target. The Company concluded that Alexion is a customer in this arrangement, and as such, the element of the arrangement unrelated to the issuance of the shares falls within the scope of the revenue recognition guidance. The Company identified the following promises under the arrangement: (i) the granting of licenses of intellectual property and know-how rights; (ii) the option to select additional targets; (iii) the option to perform validation testing on additional targets; (iv) associated research and development services for the initial and, as applicable, additional targets; and (v) the Company’s participation in the joint steering committee. The Company concluded that the research and development services were not capable of being distinct from the research and development license, and were not distinct within the context of the contract, and should therefore be combined into a single performance obligation for each program. The Company considered the level of Alexion’s therapeutic expertise specifically related to RNAi, as well as Alexion’s know-how of the Company’s GalXC conjugates, and concluded that Alexion cannot currently benefit from the granted license on its own or together with other resources that are readily available to Alexion, including relationships with oligonucleotide vendors who synthesize GalXC conjugates under contract with the Company. As a result, the combination of the license of intellectual property together with the provision of research and development services together represent the highest level of goods and services that can be deemed distinct. Additionally, the Company determined that the options to select additional targets and to perform validation testing on additional targets were not priced at a discount and, as such, do not provide Alexion with material rights. Based on management’s assessments, the Company identified a single performance obligation, namely, the combined license and research and development services, for each of the two initially nominated targets. At the outset of the Alexion Collaboration Agreement, the transaction price was determined to be $37.4 million , which is comprised of the $22.0 million upfront payment, the $5.9 million identified upon issuance of the shares, as described above, and $9.5 million in aggregate contingent milestone payments that were either received or probable of achievement and under the Company’s control. The Company used the most likely amount method to estimate variable consideration and estimated that the most likely amount for each potential development milestone payment beyond the three initial research program milestones under this agreement was zero , as the achievement of those milestones is uncertain and highly susceptible to factors outside of the Company’s control. Accordingly, such milestones were excluded from the transaction price. Management will re-evaluate the transaction price at the end of each reporting period and as uncertain events are resolved or other changes in circumstances occur and adjust the transaction price as necessary. Sales-based royalties, including milestone payments based on the level of sales, were also excluded from the transaction price, as the license is deemed to be the predominant item to which the royalties relate. The Company will recognize such revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). Revenue associated with the performance obligations is being recognized as services are provided using an input method based on a cost-to-cost measure of progress method. The transfer of control occurs over time and, in management’s judgment, this input method is the best measure of progress towards satisfying the performance obligation and reflects a faithful depiction of the transfer of goods and services. During the three months ended March 31, 2019, the Company recognized $0.4 million as revenue under the Alexion Agreements. The aggregate amount of the transaction price allocated to the Company’s partially unsatisfied performance obligations and recorded as deferred revenue at March 31, 2019 is $33.9 million , of which $8.9 million is included in the current portion of deferred revenue. As of March 31, 2019, t he Company expects to recognize this amount over the remaining research program term, which is estimated to extend through the fourth quarter of 2023, with the majority being recognized through the fourth quarter of 2021. BI Agreement and related amendments On October 27, 2017, the Company entered into a collaborative research and license agreement with BI (the “BI Agreement”), pursuant to which the Company and BI jointly research and develop product candidates for the treatment of chronic liver disease using the GalXC platform, Dicerna’s proprietary RNAi-based technology. The BI Agreement is for the development of product candidates against one target gene with an option for BI to add the development of product candidates that target a second gene (the “Second Target”). Pursuant to the BI Agreement, Dicerna granted BI a worldwide license in connection with the research and development of such product candidates and transferred certain intellectual property rights of the selected product candidates to BI for clinical development and commercialization. Dicerna also may provide assistance to BI in order to help BI further develop selected product candidates. Under the terms of the BI Agreement, BI agreed to pay Dicerna a non-refundable upfront payment of $10.0 million for the first target, less a refundable withholding tax in Germany of $1.6 million . BI also agreed to reimburse Dicerna certain third-party expenses of $0.3 million . The German withholding tax was withheld by BI and remitted to the German tax authorities in accordance with local tax law. The Company received reimbursement of this tax in July 2018. During the term of the research program, BI will reimburse Dicerna the cost of certain materials and third-party expenses that have been included in the preclinical studies. The Company is eligible to receive up to $191.0 million in potential development and commercial milestones related to the initial target. Dicerna is also eligible to receive royalty payments on potential global net sales, subject to certain adjustments, tiered from high single digits up to low double-digits. BI’s Second Target option provided for an option fee payment of $5.0 million and success-based development and commercialization milestones and royalty payments to Dicerna. Milestone payments that are contingent upon the Company’s performance under the BI Agreement include potential developmental milestones totaling $99.0 million . The Company has excluded these amounts from allocable consideration at the outset of the arrangement, as described below. All potential net sales milestones, totaling $95.0 million , will be accounted for in the same manner as royalties and recorded as revenue at the later of the achievement of the milestone or the satisfaction of the performance obligation. The Company concluded that BI is a customer in this arrangement, and as such, the arrangement falls within the scope of the revenue recognition guidance. The Company identified the following performance obligations under the contract: the license of intellectual property and conducting agreed-upon research program services. The Company concluded that the license and research and development services are not capable of being distinct and are not distinct within the context of the contract; therefore, the Company considers these to be one performance obligation. The Company concluded the option underlying the transfer of future licenses and potential associated research for any not-yet-known target gene is not a performance obligation of the contract at inception because the option fee reflects the standalone selling price of the option, and therefore, the option is not considered to be a material right. The Company considered the level of BI’s therapeutic expertise specifically related to RNAi, as well as BI’s know-how with regard to the Company’s GalXC conjugates, and concluded that BI cannot currently benefit from the granted license on its own or together with other resources that are readily available to BI, including relationships with oligonucleotide vendors who synthesize GalXC conjugates under contract with the Company. As a result, the combination of the license of intellectual property together with the provision of research and development support services together represent the highest level of goods and services that can be deemed distinct. Based on management’s evaluation, the $10.0 million non-refundable upfront fee and the $0.3 million agreed-upon reimbursable third-party expenses constituted the amount of the consideration to be included in the transaction price and was allocated to the performance obligation identified. None of the development milestones have been included in the transaction price during the period, since none of such milestone amounts are within the control of the Company and are not considered probable to occur until confirmed by BI, at BI’s sole discretion. Any consideration related to commercial sales-based milestones (including royalties) will be recognized when the related sales occur, since these amounts have been determined to relate predominantly to the license granted to BI and therefore are recognized at the later of when the performance obligation is satisfied or when the related sales occur. The Company re-evaluates the transaction price in each reporting period and as uncertain events are resolved or other changes in circumstances occur and adjusts the transaction price as necessary. The $10.3 million transaction price is recognized over the research term, currently estimated to extend through June 2019, which represents the Company’s current best estimate of the period of the obligation to provide research support services to BI. Related revenue is recognized on a straight-line basis, which is, in management’s judgment, an appropriate measure of progress toward satisfying the performance obligation, largely in absence of evidence that obligations are fulfilled in a specific pattern. The Company recognized $1.4 million associated with the first target under the BI Agreement during the three months ended March 31, 2019. The aggregate amount of the transaction price allocated to the Company’s partially unsatisfied performance obligations and recorded as deferred revenue at March 31, 2019 is $1.8 million , all of which is included in the current portion of deferred revenue. BI contract amendment In October 2018, BI exercised its Second Target option, which entitles the Company to a non-refundable payment of $5.0 million upon the agreement of a research work plan and budget for the Second Target. The terms of the Second Target option exercise and related rights and obligations associated with the Second Target were agreed between the Company and BI in an Additional Target Agreement (the “ATA”), which was entered into on December 31, 2018. Under the terms of the ATA, BI will be responsible for future clinical development and commercialization of candidate products for the Second Target. Additionally, during the term of the research program, BI will reimburse the Company for certain expenses. The Company is eligible to receive up to $170.0 million in potential development and commercial milestones related to the Second Target. The Company is also eligible to receive tiered royalty payments on potential global net sales, subject to certain adjustments, in the mid-single digits. Except as otherwise set forth in the ATA, development of the Second Target is subject to the terms of the original BI Agreement. The exercise of the Second Target option on December 31, 2018 through the ATA created a new contract for accounting purposes, and management determined that the $5.0 million exercise price was representative of the standalone selling price. Consistent with the reasons described related to the initial target, management concluded that the non-refundable Second Target option exercise fee (akin to an upfront payment) constituted the amount of the consideration to be included in the transaction price and has been allocated to the single performance obligation. The basis for the conclusions regarding the treatment of development and sales-based milestones associated with the Second Target are consistent with those associated with the initial combined performance obligation under the BI Agreement. The Company will re-evaluate the transaction price in each reporting period and as uncertain events are resolved or other changes in circumstances occur. The $5.0 million transaction price began being recognized as revenue in January 2019 and will be recognized over the research term, which is currently estimated to extend through June 2022. Consistent with the first target, revenue is recognized on a straight-line basis, which is in management’s judgment an appropriate measure of progress toward satisfying the performance obligation, largely in absence of evidence that obligations are fulfilled in a specific pattern. The Company recognized $0.8 million associated with the Second Target under the BI Agreement during the three months ended March 31, 2019. The aggregate amount of the transaction price allocated to the Company’s partially unsatisfied performance obligation and recorded as deferred revenue at March 31, 2019 is $4.2 million , $3.0 million of which is included in the current portion of deferred revenue. In addition to establishing the terms of the Second Target option exercise, the ATA also amends the BI Agreement to provide BI with the option to add, over a three -year period, the development of product candidates targeting a further additional target gene (the “Third Target Option”). Per the ATA, if BI elects, in its sole discretion, to exercise the Third Target Option, the parties would agree to a research work plan and budget for the additional gene and negotiate development and commercialization milestones and royalty payments to the Company, and BI would make an option fee payment to the Company of $5.0 million . This option exercise fee is consistent with the Second Target option exercise fee, which management concluded was representative of the standalone selling price. If BI chooses to exercise the Third Target Option, the Company will be responsible for the discovery and initial profiling of the product candidates, including primary preclinical studies, synthesis, and delivery. BI will be responsible for evaluating and selecting the product candidates for further development. If BI selects one or more product candidates, it will be responsible for further preclinical development, clinical development, manufacturing, and commercialization of those products. If the Third Target Option is exercised, such exercise would result in a new contract for accounting purposes, as the licensing rights and research and development services underlying the Third Target Option are distinct from those associated with the initial and Second Target. The following table presents changes in the Company’s aggregate deferred revenue balances for each reporting period: THREE MONTHS ENDED BALANCE AT BEGINNING OF PERIOD ADDITIONS DEDUCTIONS BALANCE AT END OF PERIOD Deferred revenue, current and noncurrent $ 183,186 $ 8,000 $ (3,107 ) $ 188,079 YEAR ENDED BALANCE AT BEGINNING OF PERIOD ADDITIONS DEDUCTIONS BALANCE AT END OF PERIOD Deferred revenue, current and noncurrent $ 9,270 $ 180,092 $ (6,176 ) $ 183,186

STOCK-BASED COMPENSAITON

STOCK-BASED COMPENSAITON	3 Months Ended
	Mar. 31, 2019
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
STOCK-BASED COMPENSAITON	STOCK-BASED COMPENSATION During the three months ended March 31, 2019 , the Company granted stock options to purchase 3,564,500 shares of common stock an aggregate grant date fair value of $28.8 million compared to stock options to purchase 1,319,350 shares of common stock granted with aggregate grant date fair values of $9.4 million for the three months ended March 31, 2018 . The assumptions used to estimate the grant date fair value using the Black-Scholes option pricing model were as follows: Three Months Ended 2019 2018 Common stock price $10.31 - $14.13 $9.30 - $12.78 Expected option term (in years) 5.94 - 6.07 6.25 Expected volatility 78.79% - 79.31% 75.90% - 90.90% Risk-free interest rate 2.24% - 2.62% 2.32% - 2.64% Expected dividend yield —% —% The Company has classified stock-based compensation in its condensed consolidated statements of operations as follows: Three Months Ended 2019 2018 Research and development expenses $ 1,858 $ 807 General and administrative expenses 2,969 940 Total $ 4,827 $ 1,747

LEASES

LEASES	3 Months Ended
	Mar. 31, 2019
Leases [Abstract]
LEASES	LEASES Facility leases On July 11, 2014, the Company executed a noncancelable operating lease for office and laboratory space in Cambridge, Massachusetts. The lease agreement, the term of which commenced on December 1, 2014, obligates the Company to make minimum payments totaling $9.6 million over a six -year lease term ending November 30, 2020 . The Company has the option to extend the lease term for one additional five -year period. Rent expense is recorded on a straight-line basis. As part of the Company’s lease agreement, the Company established a letter of credit, secured by a restricted money market account, the balance of which is presented as restricted cash equivalents at March 31, 2019 and December 31, 2018 . The Company currently has two leases for the use of office and laboratory space in addition to the lease described below. The lease for the Company’s current headquarters in Cambridge, Massachusetts has a six -year term with a five - year renewal option. The other lease, for a much smaller office in Cambridge, Massachusetts, has a 30 -month term without a renewal option. The lease term for both of the Company’s Cambridge, Massachusetts leases includes the noncancelable period of the lease, plus any additional periods covered by either a) a Company option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or b) an option to extend (or not to terminate) the lease controlled by the lessor. Future lease payments for noncancelable operating leases as of March 31, 2019 is as follows: Operating Leases (1) Remaining 2019 1,336 2020 1,901 2021 193 Total undiscounted lease payments 3,430 Less: interest expense 302 Total lease liabilities 3,128 __________________________ (1) Excluded from the table above are the lease payments associated with the lease of office and laboratory space in Lexington, Massachusetts for the Company’s future headquarters. The Company has excluded its lease payments due to the commencement date not having occurred and a lease liability not yet having been recognized on its condensed consolidated balance sheet. Payments due under each lease agreement include fixed and variable payments. Variable payments relate to the Company’s share of the lessor’s operating costs associated with the underlying asset and are recognized when the event on which those payments are assessed occurs. Neither of Dicerna’s leases contain residual value guarantees. Under ASU No. 2016-02, Leases (Topic 842) , the Company has elected to combine lease and non-lease components as a single component and not to recognize leases on the balance sheet with an initial term of one year or less. The interest rate implicit in lease agreements is typically not readily determinable, and as such, the Company utilizes the incremental borrowing rate to calculate lease liabilities, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. In addition, on January 2, 2019, Dicerna executed a lease for laboratory and office space in Lexington, Massachusetts that had not commenced as of March 31, 2019 . As a result, the Company has not yet recognized a right-of-use (“ROU”) asset or lease liability on the condensed consolidated balance sheet for the lease. The term of the lease is seven years with approximately $30.1 million in fixed payments and variable payments based on the Company’s share of the lessor’s costs. Dicerna has the option to extend the lease term at a prevailing market rate as of the extension date, which is seven years after the lease commencement date. The Company currently expects the lease to commence in the fourth quarter of 2019. The components of lease cost for the three months ended March 31, 2019 are as follows: Three Months Ended Operating lease cost $ 445 Variable lease cost — Total lease cost $ 445 Amounts reported in the condensed consolidated balance sheets for leases where the Company is the lessee as of March 31, 2019 were as follows: March 31, 2019 Operating leases Operating lease ROU assets $ 3,047 Operating lease liabilities $ 3,128 Weighted average remaining lease term Operating leases 1.80 years Weighted average discount rate Operating leases 10.00 % Other information related to leases for the three months ended March 31, 2019 is as follows: Three Months Ended Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 456 Right-of-use assets obtained in exchange for lease liabilities Operating leases $ 3,414

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES Alnylam Settlement On June 10, 2015, Alnylam filed a complaint against the Company in the Superior Court of Middlesex County, Massachusetts alleging misappropriation of confidential, proprietary, and trade secret information, as well as other related claims, in connection with the Company’s hiring of a number of former employees of Merck & Co., Inc. (“Merck”) and its discussions with Merck regarding the acquisition of its subsidiary, Sirna Therapeutics, Inc., which was subsequently acquired by Alnylam. On April 18, 2018, the Company and Alnylam entered into the Settlement Agreement, resolving all ongoing litigation between the Company and Alnylam. Pursuant to the terms of the Settlement Agreement, the Company agreed to make the following payments to Alnylam: (i) a $2.0 million upfront payment in cash, which the Company made in May 2018; (ii) an additional $13.0 million in cash to be paid as 10.0% of any upfront or first year cash consideration that the Company receives pursuant to future collaborations related to Ga1NAc-conjugated RNAi research and development (excluding any amounts received or to be received by the Company from its existing collaboration with BI), provided that the $13.0 million must be paid by no later than April 28, 2022; and (iii) issuance of shares of the Company’s common stock pursuant to the Alnylam Share Issuance Agreement. At December 31, 2018, the outstanding balance of the litigation settlement payable was $10.5 million . The Company paid the remaining outstanding balance of litigation settlement payable in full on January 22, 2019. Legal proceedings From time to time, the Company may be subject to various claims and legal proceedings in the ordinary course of business. If the potential loss from any claim, asserted or unasserted, or legal proceeding is considered probable and the amount is reasonably estimable, the Company will accrue a liability for the estimated loss. There were no contingent liabilities recorded as of March 31, 2019 .

DESCRIPTION OF BUSINESS AND B_2

DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Policies)	3 Months Ended
	Mar. 31, 2019
Accounting Policies [Abstract]
Business	Business Dicerna Pharmaceuticals, Inc. (“Dicerna” or the “Company”), a Delaware corporation founded in 2006 and headquartered in Cambridge, Massachusetts, is a biopharmaceutical company focused on the discovery and development of innovative subcutaneously delivered ribonucleic acid (“RNA”) interference (“RNAi”)-based pharmaceuticals using its GalXC RNAi platform for the treatment of diseases involving the liver, including rare diseases, viral infectious diseases, chronic liver diseases, and cardiovascular diseases. Within these therapeutic areas, the Company believes its GalXC RNAi platform will allow the Company to build a broad pipeline of therapeutics with attractive pharmaceutical properties, including a subcutaneous route of administration, infrequent dosing (e.g., dosing that is monthly or quarterly, and potentially even less frequent), high therapeutic index, and specificity to a single target gene.
Basis of presentation	Basis of presentation These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information, and include the accounts of Dicerna Pharmaceuticals, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The year-end condensed balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP to constitute a complete set of financial statements. These condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position at March 31, 2019 and results of operations and cash flows for the interim periods ended March 31, 2019 and 2018. These unaudited condensed consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. The results of the three months ended March 31, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019 or for any other interim period or for any other future year.
Significant judgments and estimates	Significant judgments and estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the Company’s condensed consolidated financial statements, as well as the revenues and expenses incurred during the reporting periods. On an ongoing basis, the Company evaluates judgments and estimates, including those related to revenue recognition and accrued expenses. The Company bases its estimates on historical experience and on various other factors that the Company believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not apparent from other sources. Changes in estimates are reflected in reported results for the period in which they become known. Actual results could differ materially from those estimates.
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies There have been no changes to the significant accounting policies disclosed in the Company’s most recent Annual Report on Form 10‑K, except as a result of adopting the Financial Accounting Standards Board (“FASB”)’s Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842), as discussed below: Leases The Company determines if an arrangement is a lease at inception. Leases with a term greater than one year are presented on the balance sheet as right-of-use (“ROU”) assets, lease liabilities and, if applicable, long-term lease liabilities. The Company has elected not to recognize on the balance sheet leases with terms of one year or less. At the commencement date, operating lease liabilities and their corresponding ROU assets are recorded based on the present value of future lease payments over the expected lease term. Certain adjustments to the ROU asset may be required for items such as initial direct costs paid or incentives received. Operating lease cost is recognized over the expected term on a straight-line basis.
Recent Accounting Pronouncement	Recent Accounting Pronouncement Adopted in 2019 Leases In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), as amended by multiple standards updates, in order to increase transparency and comparability among organizations by requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. The most significant change arising from the new standard is the recognition of ROU assets and lease liabilities for leases classified as operating leases. Under the standard, disclosures are required to enable financial statement users to assess the amount, timing, and uncertainty of cash flows arising from the leases. Companies are also required to recognize and measure leases existing at, or entered into after, the adoption date using a modified retrospective approach, with certain practical expedients available. Comparative periods prior to adoption have not been retrospectively adjusted. The Company adopted the standard effective January 1, 2019 and elected the package of three practical expedients that permitted an entity to a) not reassess whether expired or existing contracts contain leases, b) not reassess lease classification for existing or expired leases, and c) not consider whether previously capitalized initial direct costs would be appropriate under the new standard. Upon adoption, the Company recorded ROU assets of $2.7 million and lease liabilities of $2.8 million . The standard did not have a material impact on the statement of operations or statement of cash flows.
Held-To-Maturity Investments	The Company invests its excess cash balances in short-term and long-term fixed-income investments. The Company determines the appropriate classification of investments at the time of purchase and re-evaluates such designation as of each balance sheet date. Debt securities carried at amortized cost are classified as held-to-maturity when the Company has the positive intent and ability to hold the securities to maturity. The Company’s investment policy mandates that, at the time of purchase, the maturity of each investment within its portfolio shall not exceed 24 months . In addition, the weighted‑average maturity of the investment portfolio must not exceed 12 months .
Fair Value Measurements	Fair value is an exit price, representing the amount that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Valuation techniques used to measure fair value are performed in a manner to maximize the use of observable inputs and minimize the use of unobservable inputs. As a basis for considering such assumptions, the accounting literature establishes a three-tier value hierarchy which prioritizes the inputs used in measuring fair value as follows: • Level 1 – observable inputs, such as quoted prices in active markets; • Level 2 – inputs other than the quoted prices in active markets that are observable either directly or indirectly; and • Level 3 – unobservable inputs for which there is little or no market data, which requires the Company to develop its own assumptions.
Legal Proceedings	Legal proceedings From time to time, the Company may be subject to various claims and legal proceedings in the ordinary course of business. If the potential loss from any claim, asserted or unasserted, or legal proceeding is considered probable and the amount is reasonably estimable, the Company will accrue a liability for the estimated loss.

NET LOSS PER SHARE (Tables)

NET LOSS PER SHARE (Tables)	3 Months Ended
	Mar. 31, 2019
Earnings Per Share [Abstract]
Outstanding Securities excluded from Calculation of Net Loss Per Share	The outstanding securities presented below were excluded from the calculation of net loss per share, because such securities would have been anti-dilutive due to the Company’s net loss per share during the periods ending on the dates presented. Three Months Ended 2019 2018 Options to purchase common stock 11,191,789 7,171,978 Warrants to purchase common stock 2,198 87,901 Total 11,193,987 7,259,879

HELD-TO-MATURITY INVESTMENTS (T

HELD-TO-MATURITY INVESTMENTS (Tables)	3 Months Ended
	Mar. 31, 2019
Investments, Debt and Equity Securities [Abstract]
Schedule of Held-To-Maturity Investments	The following tables provide information relating to the Company’s held-to-maturity investments: MARCH 31, 2019 DESCRIPTION AMORTIZED COST GROSS UNREALIZED GAINS GROSS LOSSES FAIR VALUE U.S. Treasury securities maturing in one year or less $ 211,063 $ 24 $ (4 ) $ 211,083 DECEMBER 31, 2018 DESCRIPTION AMORTIZED COST GROSS UNREALIZED GAINS GROSS LOSSES FAIR VALUE U.S. Treasury securities maturing in one year or less $ 248,387 $ — $ (43 ) $ 248,344

FAIR VALUE MEASUREMENTS (Tables

FAIR VALUE MEASUREMENTS (Tables)	3 Months Ended
	Mar. 31, 2019
Fair Value Disclosures [Abstract]
Schedule of Assets Measured or Disclosed at Fair Value	A summary of the Company’s assets that are measured or disclosed at fair value on a recurring basis is presented below: MARCH 31, 2019 DESCRIPTION TOTAL FAIR VALUE LEVEL 1 LEVEL 2 LEVEL 3 Cash equivalents Money market funds $ 160,908 $ 160,908 $ — $ — Held-to-maturity investments U.S. Treasury securities 211,083 — 211,083 — Restricted cash equivalents Money market funds 3,544 — 3,544 — Total $ 375,535 $ 160,908 $ 214,627 $ — DECEMBER 31, 2018 DESCRIPTION TOTAL FAIR VALUE LEVEL 1 LEVEL 2 LEVEL 3 Cash equivalents Money market funds $ 44,886 $ 44,886 $ — $ — Held-to-maturity investments U.S. Treasury securities 248,344 — 248,344 — Restricted cash equivalents Money market funds 744 — 744 — Total $ 293,974 $ 44,886 $ 249,088 $ —

COLLABORATIVE RESEARCH AND LI_2

COLLABORATIVE RESEARCH AND LICENSE AGREEMENTS (Tables)	3 Months Ended
	Mar. 31, 2019
Revenue from Contract with Customer [Abstract]
Contract with Customer, Asset and Liability	The following table presents changes in the Company’s aggregate deferred revenue balances for each reporting period: THREE MONTHS ENDED BALANCE AT BEGINNING OF PERIOD ADDITIONS DEDUCTIONS BALANCE AT END OF PERIOD Deferred revenue, current and noncurrent $ 183,186 $ 8,000 $ (3,107 ) $ 188,079 YEAR ENDED BALANCE AT BEGINNING OF PERIOD ADDITIONS DEDUCTIONS BALANCE AT END OF PERIOD Deferred revenue, current and noncurrent $ 9,270 $ 180,092 $ (6,176 ) $ 183,186

STOCK-BASED COMPENSAITON (Table

STOCK-BASED COMPENSAITON (Tables)	3 Months Ended
	Mar. 31, 2019
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of Valuation Assumptions	During the three months ended March 31, 2019 , the Company granted stock options to purchase 3,564,500 shares of common stock an aggregate grant date fair value of $28.8 million compared to stock options to purchase 1,319,350 shares of common stock granted with aggregate grant date fair values of $9.4 million for the three months ended March 31, 2018 . The assumptions used to estimate the grant date fair value using the Black-Scholes option pricing model were as follows: Three Months Ended 2019 2018 Common stock price $10.31 - $14.13 $9.30 - $12.78 Expected option term (in years) 5.94 - 6.07 6.25 Expected volatility 78.79% - 79.31% 75.90% - 90.90% Risk-free interest rate 2.24% - 2.62% 2.32% - 2.64% Expected dividend yield —% —%
Stock-Based Compensation Expense	The Company has classified stock-based compensation in its condensed consolidated statements of operations as follows: Three Months Ended 2019 2018 Research and development expenses $ 1,858 $ 807 General and administrative expenses 2,969 940 Total $ 4,827 $ 1,747

LEASES (Tables)

LEASES (Tables)	3 Months Ended
	Mar. 31, 2019
Leases [Abstract]
Schedule of Future Minimum Lease Payments	Future lease payments for noncancelable operating leases as of March 31, 2019 is as follows: Operating Leases (1) Remaining 2019 1,336 2020 1,901 2021 193 Total undiscounted lease payments 3,430 Less: interest expense 302 Total lease liabilities 3,128 __________________________ (1) Excluded from the table above are the lease payments associated with the lease of office and laboratory space in Lexington, Massachusetts for the Company’s future headquarters. The Company has excluded its lease payments due to the commencement date not having occurred and a lease liability not yet having been recognized on its condensed consolidated balance sheet.
Components of Lease Cost	The components of lease cost for the three months ended March 31, 2019 are as follows: Three Months Ended Operating lease cost $ 445 Variable lease cost — Total lease cost $ 445 Other information related to leases for the three months ended March 31, 2019 is as follows: Three Months Ended Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 456 Right-of-use assets obtained in exchange for lease liabilities Operating leases $ 3,414
Lease Amounts Reported in Balance Sheets	Amounts reported in the condensed consolidated balance sheets for leases where the Company is the lessee as of March 31, 2019 were as follows: March 31, 2019 Operating leases Operating lease ROU assets $ 3,047 Operating lease liabilities $ 3,128 Weighted average remaining lease term Operating leases 1.80 years Weighted average discount rate Operating leases 10.00 %

DESCRIPTION OF BUSINESS AND B_3

DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION - Additional Information (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Jan. 01, 2019
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Right-of-use asset	$ 3,047
Lease liability	$ 3,128
ASU 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Right-of-use asset		$ 2,700
Lease liability		$ 2,800

NET LOSS PER SHARE - Additional

NET LOSS PER SHARE - Additional Information (Details)	Mar. 31, 2019USD ($)
Earnings Per Share [Abstract]
Contractual obligation to share in losses of the company	$ 0

NET LOSS PER SHARE - Outstandin

NET LOSS PER SHARE - Outstanding Securities excluded from Calculation of Net Loss Per Share (Details) - shares	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities (in shares)	11,193,987	7,259,879
Options to purchase common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities (in shares)	11,191,789	7,171,978
Warrants to purchase common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities (in shares)	2,198	87,901

HELD-TO-MATURITY INVESTMENTS -

HELD-TO-MATURITY INVESTMENTS - Additional Information (Details)	3 Months Ended
	Mar. 31, 2019
Schedule of Held-to-maturity Securities [Line Items]
Held-to-maturity investments portfolio maximum period	24 months
Maximum
Schedule of Held-to-maturity Securities [Line Items]
Weighted average maturity investment portfolio period	12 months

HELD-TO-MATURITY INVESTMENTS _2

HELD-TO-MATURITY INVESTMENTS - Schedule of Held-To-Maturity Investments (Details) - U.S. Treasury securities maturing in one year or less - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Schedule of Held-to-maturity Securities [Line Items]
AMORTIZED COST	$ 211,063	$ 248,387
GROSS UNREALIZED HOLDING GAINS	24	0
GROSS UNREALIZED HOLDING LOSSES	(4)	(43)
FAIR VALUE	$ 211,083	$ 248,344

FAIR VALUE MEASUREMENTS - Sched

FAIR VALUE MEASUREMENTS - Schedule of Assets Measured or Disclosed at Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Restricted cash equivalents
Total	$ 375,535	$ 293,974
Money market funds
Cash equivalents
Money market funds	160,908	44,886
Restricted cash equivalents
Money market funds	3,544	744
U.S. Treasury securities
Held-to-maturity investments
U.S. Treasury securities	211,083	248,344
LEVEL 1
Restricted cash equivalents
Total	160,908	44,886
LEVEL 1 | Money market funds
Cash equivalents
Money market funds	160,908	44,886
Restricted cash equivalents
Money market funds	0	0
LEVEL 1 | U.S. Treasury securities
Held-to-maturity investments
U.S. Treasury securities	0	0
LEVEL 2
Restricted cash equivalents
Total	214,627	249,088
LEVEL 2 | Money market funds
Cash equivalents
Money market funds	0	0
Restricted cash equivalents
Money market funds	3,544	744
LEVEL 2 | U.S. Treasury securities
Held-to-maturity investments
U.S. Treasury securities	211,083	248,344
LEVEL 3
Restricted cash equivalents
Total	0	0
LEVEL 3 | Money market funds
Cash equivalents
Money market funds	0	0
Restricted cash equivalents
Money market funds	0	0
LEVEL 3 | U.S. Treasury securities
Held-to-maturity investments
U.S. Treasury securities	$ 0	$ 0

FAIR VALUE MEASUREMENTS - Addit

FAIR VALUE MEASUREMENTS - Additional Information (Details) $ in Millions	Dec. 31, 2018USD ($)
Alnylam
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash obligation payable as part of litigation settlement	$ 10.5

COLLABORATIVE RESEARCH AND LI_3

COLLABORATIVE RESEARCH AND LICENSE AGREEMENTS - Lilly Collaboration and Share Purchase Agreements (Details)	Oct. 25, 2018USD ($)target$ / sharesshares	Mar. 31, 2019USD ($)	Mar. 31, 2018USD ($)	Dec. 31, 2018USD ($)	Dec. 31, 2017USD ($)
Disaggregation of Revenue [Line Items]
Revenue from collaborative arrangements		$ 3,107,000	$ 1,545,000
Deferred revenue		188,079,000		$ 183,186,000	$ 9,270,000
Current portion of deferred revenue		59,784,000		$ 68,893,000
Lilly Collaboration And License Agreement
Disaggregation of Revenue [Line Items]
Number of hepatocyte targets | target	3
Number of targets in excess to contemplate agreement | target	10
Initial non-refundable upfront payment	$ 100,000,000
Payment due on first non-hepatocyte target achievement	$ 5,000,000
Collaborative arrangement term	10 years
Revenue from collaborative arrangements		500,000
Deferred revenue		148,100,000
Current portion of deferred revenue		$ 46,100,000
Lilly Collaboration And License Agreement | Maximum
Disaggregation of Revenue [Line Items]
Development and commercialization milestones receivable	$ 350,000,000
Lilly Share Issuance Agreement
Disaggregation of Revenue [Line Items]
Number of shares issuable (in shares) | shares	5,414,185
Sale of stock (in dollars per share) | $ / shares	$ 18.47
Expected proceeds from issuance of common stock	$ 100,000,000
Combined Agreements
Disaggregation of Revenue [Line Items]
Upfront compensation	200,000,000
Compensation recorded in equity upon the issuance of the shares	51,300,000
Consideration received	148,700,000
Variable consideration for potential development and regulatory milestone beyond the three initial	$ 0

COLLABORATIVE RESEARCH AND LI_4

COLLABORATIVE RESEARCH AND LICENSE AGREEMENTS - Alexion Collaboration and Equity Agreements (Details)	Oct. 22, 2018USD ($)targetcandidate$ / sharesshares	Mar. 31, 2019USD ($)	Mar. 31, 2018USD ($)	Dec. 31, 2018USD ($)
Disaggregation of Revenue [Line Items]
Revenue from collaborative arrangements		$ 3,107,000	$ 1,545,000
Deferred revenue, net of current portion		128,295,000		$ 114,293,000
Current portion of deferred revenue		59,784,000		$ 68,893,000
Alexion Collaborative Research And License Agreement
Disaggregation of Revenue [Line Items]
Number of candidates | candidate	2
Number of pathway targets | target	2
Initial non-refundable upfront payment	$ 22,000,000
Collaborative arrangement option exercise fee for each of candidates selected	10,000,000
Aggregate sales milestones receivable	$ 160,000,000
Collaborative arrangement term	10 years
Compensation recorded in equity upon the issuance of the shares	$ 5,900,000
Number of additional pathway targets | target	2
Transaction price	$ 37,400,000
Contingent milestone payments	9,500,000
Potential developmental milestones receivable	3
Variable consideration for potential development and regulatory milestone beyond the three initial	0
Alexion Collaborative Research And License Agreement | Maximum
Disaggregation of Revenue [Line Items]
Additional payment receivable	600,000,000
Option exercise fee	20,000,000
Development milestones receivable for each product	$ 105,000,000
Alexion Share Issuance Agreement
Disaggregation of Revenue [Line Items]
Number of shares issuable (in shares) | shares	835,834
Sale of stock (in dollars per share) | $ / shares	$ 17.95
Expected proceeds from issuance of common stock	$ 15,000,000
Alexion Agreements
Disaggregation of Revenue [Line Items]
Expected proceeds from issuance of common stock	15,000,000
Compensation recorded in equity upon the issuance of the shares	9,100,000
Transaction price	$ 5,900,000
Revenue from collaborative arrangements		400,000
Deferred revenue, net of current portion		33,900,000
Current portion of deferred revenue		$ 8,900,000

COLLABORATIVE RESEARCH AND LI_5

COLLABORATIVE RESEARCH AND LICENSE AGREEMENTS - BI Agreement and Related Amendments (Details) - USD ($) $ in Thousands	Oct. 27, 2017	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018	Oct. 31, 2018
Disaggregation of Revenue [Line Items]
Revenue from collaborative arrangements		$ 3,107	$ 1,545
Deferred revenue, net of current portion		128,295		$ 114,293
Current portion of deferred revenue		59,784		68,893
Foreign Tax Authority
Disaggregation of Revenue [Line Items]
Income taxes receivable	$ 1,600
Boehringer Ingelheim Agreement
Disaggregation of Revenue [Line Items]
Initial non-refundable upfront payment	10,000
Reimbursable third-party expenses	300
Consideration receivable upon potential development and commercial milestones	191,000
Potential developmental milestones receivable	99,000
Net sales milestones	95,000
Revenue from collaborative arrangements		1,400
Current portion of deferred revenue	1,800
Boehringer Ingelheim Agreement | Transferred over Time
Disaggregation of Revenue [Line Items]
Remaining performance obligation amount	10,300
Additional Target Agreement
Disaggregation of Revenue [Line Items]
Initial non-refundable upfront payment					$ 5,000
Consideration receivable upon potential development and commercial milestones		170,000
Option exercise fee	$ 5,000	5,000		$ 5,000
Transaction price		$ 5,000
Collaborative arrangement term		3 years
Revenue from collaborative arrangements		$ 800
Deferred revenue, net of current portion		4,200
Current portion of deferred revenue		$ 3,000

COLLABORATIVE RESERACH AND LICE

COLLABORATIVE RESERACH AND LICENSE AGREEMENTS - Changes in Deferred Revenue (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Movement in Deferred Revenue [Roll Forward]
BALANCE AT BEGINNING OF PERIOD	$ 183,186	$ 9,270
ADDITIONS	8,000	180,092
DEDUCTIONS	(3,107)	(6,176)
BALANCE AT END OF PERIOD	$ 188,079	$ 183,186

STOCK-BASED COMPENSAITON - Narr

STOCK-BASED COMPENSAITON - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock options awarded (in shares)	3,564,500	1,319,350
Aggregate intrinsic value, outstanding	$ 28.8		$ 9.4

STOCK-BASED COMPENSAITON - Sche

STOCK-BASED COMPENSAITON - Schedule of Valuation Assumptions (Details) - Employee Stock Option - $ / shares	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected option term (in years)		6 years 3 months
Expected dividend yield	0.00%	0.00%
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock price	$ 10.31	$ 9.30
Expected option term (in years)	5 years 11 months 9 days
Expected volatility	78.79%	75.90%
Risk-free interest rate	2.24%	2.32%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock price	$ 14.13	$ 12.78
Expected option term (in years)	6 years 26 days
Expected volatility	79.31%	90.90%
Risk-free interest rate	2.62%	2.64%

STOCK-BASED COMPENSAITON - Clas

STOCK-BASED COMPENSAITON - Classification of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total	$ 4,827	$ 1,747
Research and development expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total	1,858	807
General and administrative expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total	$ 2,969	$ 940

LEASES - Narrative (Details)

LEASES - Narrative (Details) $ in Thousands	Jan. 02, 2019USD ($)	Mar. 31, 2019USD ($)contractrenewal_option	Dec. 01, 2014USD ($)
Lessee, Lease, Description [Line Items]
Lease liability payments		$ 3,430	$ 9,600
Term of contract			6 years
Number of renewal options | renewal_option		1
Renewal term		5 years
Lease payments		$ 456
Facility
Lessee, Lease, Description [Line Items]
Term of contract	7 years
Number of contracts | contract		2
Lease payments	$ 30,100
Office Building
Lessee, Lease, Description [Line Items]
Term of contract		6 years
Renewal term		5 years
Laboratory
Lessee, Lease, Description [Line Items]
Term of contract		30 months

LEASES - Future Lease Payments

LEASES - Future Lease Payments (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 01, 2014
Leases [Abstract]
Remaining 2019	$ 1,336
2020	1,901
2021	193
Total undiscounted lease payments	3,430	$ 9,600
Less: interest expense	302
Total lease liabilities	$ 3,128

LEASES - Components of Lease Co

LEASES - Components of Lease Cost (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019USD ($)
Leases [Abstract]
Operating lease cost	$ 445
Variable lease cost	0
Total lease cost	$ 445

LEASES - Amounts Reported in Ba

LEASES - Amounts Reported in Balance Sheets (Details) $ in Thousands	Mar. 31, 2019USD ($)
Operating leases
Operating lease ROU assets	$ 3,047
Operating lease liabilities	$ 3,128
Weighted average remaining lease term
Operating leases	1 year 9 months 18 days
Weighted average discount rate
Operating leases	10.00%

LEASES - Other Information Rela

LEASES - Other Information Related to Leases (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019USD ($)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$ 456
Right-of-use assets obtained in exchange for lease liabilities
Operating leases	$ 3,414

COMMITMENTS AND CONTINGENCIES -

COMMITMENTS AND CONTINGENCIES - Narrative (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018	Apr. 18, 2018
Loss Contingencies [Line Items]
Litigation settlement payable	$ 0	$ 10,500,000
Alnylam
Loss Contingencies [Line Items]
Cash obligation payable as part of litigation settlement		$ 10,500,000
Settled Litigation
Loss Contingencies [Line Items]
Contingent liabilities	$ 0
Settled Litigation | Alnylam
Loss Contingencies [Line Items]
Litigation settlement upfront payment payable			$ 2,000,000
Additional litigation settlement payment			$ 13,000,000
Percentage of consideration receivable related to future collaboration			10.00%
Cash obligation payable as part of litigation settlement			$ 13,000,000

Uncategorized Items - drna-2019

Label	Element	Value
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ (91,000)
Retained Earnings [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ (91,000)