Neurogene (NGNE) 10-Q 9 May 17 2017 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2017	May 09, 2017
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q1
Trading Symbol	AQXP
Entity Registrant Name	AQUINOX PHARMACEUTICALS, INC
Entity Central Index Key	1,404,644
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		23,423,150

Condensed consolidated balance

Condensed consolidated balance sheets - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Current assets
Cash and cash equivalents (Note 3)	$ 20,916	$ 32,301
Short-term investments (Note 8)	100,665	70,758
Receivables, prepayments and deposits	855	426
Total current assets	122,436	103,485
Property and equipment, net	885	849
Long-term investments (Note 8)	20,008	50,046
Total assets	143,329	154,380
Current liabilities
Accounts payable and other liabilities	5,824	9,519
Total current liabilities	5,824	9,519
Other liabilities (Note 4)	562	197
Total liabilities	6,386	9,716
Share capital: (Note 5)
Common stock	0	0
Additional paid-in capital	293,783	293,111
Accumulated deficit	(156,635)	(148,278)
Accumulated other comprehensive loss	(205)	(169)
Total stockholders' equity	136,943	144,664
Total liabilities and stockholders' equity	$ 143,329	$ 154,380

Condensed consolidated balance3

Condensed consolidated balance sheets (Parenthetical) - $ / shares	Mar. 31, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.000001	$ 0.000001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	23,423,150	23,423,150
Common stock, shares outstanding	23,423,150	23,423,150

Condensed consolidated statemen

Condensed consolidated statements of operations and comprehensive loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Operating expenses
Research and development	$ 5,777	$ 4,881
General and administrative	2,745	1,953
Total operating expenses	8,522	6,834
Other income (Note 6)	206	123
Net loss before income taxes	(8,316)	(6,711)
Net loss	$ (8,316)	$ (6,711)
Net loss per common stock - basic and diluted (Note 7)	$ (0.36)	$ (0.39)
Basic and diluted weighted average number of common stock outstanding	23,423,150	17,211,986
Comprehensive loss:
Net loss	$ (8,316)	$ (6,711)
Other comprehensive (loss) income - unrealized (loss) gain on available-for-sale securities	(36)	243
Comprehensive loss	$ (8,352)	$ (6,468)

Condensed consolidated stateme5

Condensed consolidated statements of cash flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Operating activities
Net loss	$ (8,316)	$ (6,711)
Non-cash items and reclassifications:
Change in fair value of derivative liability (Note 6)		(50)
Stock-based compensation (Note 5(c))	631	433
Unrealized foreign exchange loss and others	146	31
Changes in operating assets and liabilities:
Receivable, prepayments and deposits	(426)	(465)
Accounts payable and other liabilities	(3,315)	890
Cash used in operating activities	(11,280)	(5,872)
Investing activities
Purchase of investments		(13,002)
Proceeds from maturity of investments		15,025
Purchase of property and equipment	(108)	(27)
Cash (used in) provided by investing activities	(108)	1,996
Financing activity
Payment on capital lease obligations	(4)
Cash used in financing activity	(4)
Effect of exchange rate changes on cash and cash equivalents	7	41
Net change in cash and cash equivalents during the period	(11,385)	(3,835)
Cash and cash equivalents, beginning of period	32,301	39,526
Cash and cash equivalents, end of period	20,916	35,691
Supplemental disclosure of cash flow information:
Interest received	234	$ 121
Non-cash investing and financing activities:
Accrued purchase of property & equipment	$ (24)

Nature of operations

Nature of operations	3 Months Ended
	Mar. 31, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of operations	1. Nature of operations Aquinox Pharmaceuticals, Inc. and its subsidiary, Aquinox Pharmaceuticals (Canada) Inc., (consolidated, the “Company”) is a clinical stage pharmaceutical company discovering and developing targeted therapeutics in disease areas of inflammation and immuno-oncology. The Company’s primary focus is anti-inflammatory product candidates targeting SHIP1 (SH2-containing inositol-5’-phosphatase Aquinox Pharmaceuticals, Inc. was originally incorporated under the name of Aquinox Pharmaceuticals (USA) Inc. on May 31, 2007 in the State of Delaware, United States. On January 27, 2014, Aquinox Pharmaceuticals (USA) Inc. changed its name to Aquinox Pharmaceuticals, Inc. (“Aquinox USA”). Aquinox Pharmaceuticals (Canada) Inc. (“AQXP Canada”) was originally incorporated under the name of 6175813 Canada Inc. on December 26, 2003 under the Canada Business Corporations Act. In May 2014, after a corporate restructuring, the name was changed to Aquinox Pharmaceuticals (Canada) Inc. The Company operates in Vancouver, British Columbia, Canada and San Bruno, California.

Condensed summary of significan

Condensed summary of significant accounting policies	3 Months Ended
	Mar. 31, 2017
Accounting Policies [Abstract]
Condensed summary of significant accounting policies	2. Condensed summary of significant accounting policies (a) Basis of presentation The accompanying unaudited condensed consolidated financial statements are presented in United States (“U.S.”) dollars and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, these financial statements do not include all of the information and footnotes required for complete financial statements and should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position as of March 31, 2017, and results of operations and cash flows for all periods presented. The interim results presented are not necessarily indicative of results that can be expected for a full year. (b) Use of estimates and assumptions The preparation of financial statements in conformity with U.S. 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 financial statements and the reported amounts of expenses during the reporting period. Significant areas requiring management estimates include valuation of stock options and warrants, amortization and depreciation, accrual of expenses, valuation allowance for deferred income taxes, and contingencies. Actual results could differ from those estimates. (c) Short and long-term investments Short-term investments consist of bank term deposits and U.S. government securities with initial maturities of less than a year. Long-term investments consist of U.S. government securities with initial maturities of greater than a year. Short-term investments and long-term investments are both classified as available-for-sale (d) Accounting for stock-based compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the grant-date fair value of the award. The cost of such award will be recognized over the period during which services are provided in exchange for the award, generally the vesting period. All share-based payments to employees are recognized in the consolidated financial statements based upon their respective grant date fair values. The Company estimates the fair value of options granted using the Black-Scholes option pricing model. This approximation uses assumptions regarding a number of inputs that requires management to make significant estimates and judgments. Prior to the completion of the Company’s initial public offering in March 2014, the Company’s common stock was not publicly traded. As a result, the expected volatility assumption is based on industry peer information due to insufficient trading history of the Company’s common stock. Additionally, because the Company has no significant history to calculate the expected term, the simplified method calculation is used. (e) Segment reporting The Company operates in one segment, the identification and development of therapeutics for inflammatory diseases and cancer. The Company has significant Canadian operations but its assets are mostly held in the United States with an immaterial amount of long lived assets in Canada. (f) Net loss per common stock Basic net loss per common stock is computed by dividing loss by the weighted-average number of common stock outstanding during the period. Diluted net loss per common stock is determined using the weighted-average number of common stock outstanding during the period, adjusted for the dilutive effect of common stock equivalents, consisting of shares that might be issued upon exercise of common stock options and warrants. In periods where losses are reported, the weighted-average number of shares of common stock outstanding excludes common stock equivalents because their inclusion would be anti-dilutive. (g) Recently issued and recently adopted accounting standards The Company adopted FASB ASU 2015-17 The Company adopted FASB ASU 2016-09 In January 2016, the FASB issued ASU 2016-01 825-10): 2016-01 2016-01 In February 2016, the FASB issued ASU 2016-02 right-of-use 2016-02, 2016-02 2016-02 (h) Risks and uncertainties The Company is subject to numerous risks and uncertainties. These risks, among others, included the following: • the Company has no source of revenue, had an accumulated deficit of $156,635 as of March 31, 2017, may never become profitable and may incur substantial and increasing net losses for the foreseeable future as it continues development of, seeks regulatory approvals for, and potentially begins to commercialize AQX-1125, • the Company is likely to require additional capital to finance its operations which may not be available to it on acceptable terms, or at all; • the Company’s success is primarily dependent on the successful development, regulatory approval and commercialization of AQX-1125, • SHIP1 has not been validated as a target; • the Company is subject to regulatory approval processes that are lengthy, time consuming and inherently unpredictable; the Company may not be able to obtain approval for AQX-1125 • the Company’s intellectual property rights may be subject to claims by third parties and can be difficult and costly to protect; • the Company may not be able to recruit or retain key employees, including its senior management team; • the Company depends on the performance of third parties, including contract research organizations and third-party manufacturers; and • the Company faces competition from other pharmaceutical and biotechnology companies, academic institutions, governmental agencies, and public and private research institutions, among others.

Cash and cash equivalents

Cash and cash equivalents	3 Months Ended
	Mar. 31, 2017
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	3. Cash and cash equivalents MARCH 31, 2017 DECEMBER 31, Cash $ 18,686 $ 3,726 Cash equivalents 2,230 28,575 $ 20,916 $ 32,301

Other Liabilities

Other Liabilities	3 Months Ended
	Mar. 31, 2017
Other Liabilities Disclosure [Abstract]
Other Liabilities	4. Other Liabilities MARCH 31, 2017 DECEMBER 31, Capital lease obligations $ 44 $ 47 Deferred rent liability 518 150 $ 562 $ 197

Stockholders' equity

Stockholders' equity	3 Months Ended
	Mar. 31, 2017
Equity [Abstract]
Stockholders' equity	5. Stockholders’ equity (a) Share capital Aquinox USA is authorized to issue two classes of stock, common and preferred. The total number of shares Aquinox USA is authorized to issue is 55,000,000 shares, comprised of 50,000,000 common stock and 5,000,000 preferred stock both with a par value of $0.000001 per share. As of March 31, 2017 and December 31, 2016, the total number of shares of common stock issued and outstanding was 23,423,150. As of March 31, 2017 and December 31, 2016, no shares of preferred stock were issued or outstanding. (b) Stock option plan On January 27, 2014, the stockholders of Aquinox USA approved a 2014 Equity Incentive Plan (“2014 Plan”). The 2014 Plan became effective on March 6, 2014. The 2014 Plan is the successor to and continuation of the Joint Canadian Stock Option Plan (the “2006 Plan”). No further grants will be made under the 2006 Plan. The 2014 Plan provides for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance stock awards, performance cash awards, and other forms of equity awards to employees, directors, and consultants. As at March 31, 2017, the maximum number of shares of common stock that may be issued under the 2014 Plan was 2,890,063 shares. Additionally, the number of shares of common stock reserved for issuance under the 2014 Plan will automatically increase on January 1 of each year for a period of up to 10 years, beginning on January 1, 2015 and ending on and including January 1, 2024, by 4% of the total number of shares of capital outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the board of directors. Stock option transactions and the number of stock options outstanding are summarized below: NUMBER OF SHARES WEIGHTED WEIGHTED (IN YEARS) AGGREGATE Outstanding at December 31, 2016 1,378,352 $ 9.38 7.81 $ 9,829 Options granted 696,100 17.35 Options forfeited (59,063 ) 12.37 Outstanding at March 31, 2017 2,015,389 $ 12.04 8.34 $ 9,806 Exercisable as of March 31, 2017 713,412 $ 9.26 6.44 $ 5,299 During the three months ended March 31, 2017, the Company granted 696,100 stock options to employees. The stock options granted to employees during the three months ended March 31, 2017 have an exercise price per share of $17.35 and vest 25% one year after the beginning of the vesting period and thereafter ratably each month over the following thirty-six 10-year During the three months ended March 31, 2017, no shares of common stock were issued upon exercise of options. (c) Stock-based compensation The fair value of stock options granted is estimated using the Black-Scholes option pricing model with the following weighted average assumptions: THREE MONTHS ENDED 2017 2016 Expected volatility 91 % 80 % Expected dividends 0 % 0 % Expected terms (years) 6.00 6.00 Risk free rate 1.90 % 1.27 % Weighted average grant-date fair value of stock options $ 13.02 $ 5.67 The Company amortizes the fair value of the stock options on a straight-line basis over the applicable requisite service periods of the awards, which is generally the vesting period. Stock-based compensation expense charged to operating expenses was $631 and $433 for the three months ended March 31, 2017 and March 31, 2016, respectively. Total unrecognized compensation cost for all stock-based compensation plans was $12,807 and $4,839 as of March 31, 2017 and March 31, 2016, respectively, which is expected to be recognized over a weighted-average period of 3.34 years (March 31, 2016 – 3.21 years)

Other income

Other income	3 Months Ended
	Mar. 31, 2017
Other Income and Expenses [Abstract]
Other income	6. Other income THREE MONTHS ENDED 2017 2016 Change in fair value of derivative liability $ — $ 50 Foreign exchange losses (8 ) (26 ) Interest income 234 121 Miscellaneous expenses (20 ) (22 ) $ 206 $ 123

Net loss per common stock

Net loss per common stock	3 Months Ended
	Mar. 31, 2017
Earnings Per Share [Abstract]
Net loss per common stock	7. Net loss per common stock Basic and diluted net loss per common stock is computed by dividing net loss by the weighted average number of common stock outstanding. The Company excluded outstanding stock options and common stock warrants from the calculation of basic and diluted net loss per common stock as the effect would have been antidilutive for all periods presented. The following have been excluded from the computation of basic and diluted net loss per common stock as their effect would have been antidilutive: THREE MONTHS ENDED MARCH 31, 2017 2016 Outstanding stock options 2,015,389 1,255,573 Common stock warrants — 11,363 Total 2,015,389 1,266,936

Financial instruments

Financial instruments	3 Months Ended
	Mar. 31, 2017
Investments, All Other Investments [Abstract]
Financial instruments	8. Financial instruments Securities classified as available for sale The Company’s short-term investments and long-term investments consisted of available-for-sale Amortized cost Gross Gross Fair value March 31, 2017 Short-term investments: U.S. treasury securities $ 100,817 $ — $ (152 ) $ 100,665 Long-term investments: U.S. treasury securities $ 20,061 $ — $ (53 ) $ 20,008 Contractual maturities: Due within one year $ 100,817 $ 100,665 Due after one year through two years 20,061 20,008 December 31, 2016 Short-term investments: U.S. treasury securities $ 70,819 $ — $ (61 ) $ 70,758 Long-term investments: U.S. treasury securities $ 50,155 $ — $ (109 ) $ 50,046 Contractual maturities: Due within one year $ 70,819 $ 70,758 Due after one year through two years 50,155 50,046 The aggregate estimated fair value of the Company’s investments with unrealized losses are as follows: Period of continuous unrealized loss 12 months or less Greater than 12 months Fair value Gross Fair value Gross March 31, 2017 U.S. treasury securities $ 120,673 $ (205 ) N/A N/A December 31, 2016 U.S. treasury securities $ 120,804 $ (170 ) N/A N/A Fair value of financial instruments Fair value is defined as the amounts that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The fair value of the Company’s financial instruments are determined according to a fair value hierarchy that prioritizes the inputs and assumptions used, and the valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the hierarchy are as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted 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 assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The determination of a financial instrument’s level within the fair value hierarchy is based on an assessment of the lowest level of any input that is significant to the fair value measurement. The Company considers observable data to be market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The carrying amounts of certain of the Company’s financial instruments including cash, cash equivalents, receivables, accounts payable and other liabilities, approximate their fair values because of their nature and/or short maturities. The Company holds short and long-term investments that are classified as available-for-sale The following tables present the fair value of our financial instruments that are measured at fair value on a recurring basis: QUOTED (LEVEL 1) OTHER (LEVEL 2) SIGNIFICANT UN- OBSERVABLE (LEVEL 3) TOTAL BALANCES – March 31, 2017 Short-term investments – U.S. treasury securities $ 100,665 $ — $ — $ 100,665 Long-term investments – U.S. treasury securities 20,008 — — 20,008 $ 120,673 $ — $ — $ 120,673 BALANCES – December 31, 2016 Short-term investments – U.S. treasury securities $ 70,758 $ — $ — $ 70,758 Long-term investments – U.S. treasury securities 50,046 — — 50,046 $ 120,804 $ — $ — $ 120,804 Level 1 instruments, which include investments that are valued based on quoted market prices in active markets, consisted of U.S. treasury securities. The Company had no Level 2 or 3 investments as at March 31, 2017 and December 31, 2016. There were no transfers between Levels 1, 2, and 3 during the three months ended March 31, 2017 and the year ended December 31, 2016. As at March 31, 2017, the Company had short-term investments consisting of available-for-sale available-for-sale

Condensed summary of signific14

Condensed summary of significant accounting policies (Policies)	3 Months Ended
	Mar. 31, 2017
Accounting Policies [Abstract]
Basis of presentation	(a) Basis of presentation The accompanying unaudited condensed consolidated financial statements are presented in United States (“U.S.”) dollars and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, these financial statements do not include all of the information and footnotes required for complete financial statements and should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position as of March 31, 2017, and results of operations and cash flows for all periods presented. The interim results presented are not necessarily indicative of results that can be expected for a full year.
Use of estimates and assumptions	(b) Use of estimates and assumptions The preparation of financial statements in conformity with U.S. 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 financial statements and the reported amounts of expenses during the reporting period. Significant areas requiring management estimates include valuation of stock options and warrants, amortization and depreciation, accrual of expenses, valuation allowance for deferred income taxes, and contingencies. Actual results could differ from those estimates.
Short and long-term investments	(c) Short and long-term investments Short-term investments consist of bank term deposits and U.S. government securities with initial maturities of less than a year. Long-term investments consist of U.S. government securities with initial maturities of greater than a year. Short-term investments and long-term investments are both classified as available-for-sale
Accounting for stock-based compensation	(d) Accounting for stock-based compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the grant-date fair value of the award. The cost of such award will be recognized over the period during which services are provided in exchange for the award, generally the vesting period. All share-based payments to employees are recognized in the consolidated financial statements based upon their respective grant date fair values. The Company estimates the fair value of options granted using the Black-Scholes option pricing model. This approximation uses assumptions regarding a number of inputs that requires management to make significant estimates and judgments. Prior to the completion of the Company’s initial public offering in March 2014, the Company’s common stock was not publicly traded. As a result, the expected volatility assumption is based on industry peer information due to insufficient trading history of the Company’s common stock. Additionally, because the Company has no significant history to calculate the expected term, the simplified method calculation is used.
Segment reporting	(e) Segment reporting The Company operates in one segment, the identification and development of therapeutics for inflammatory diseases and cancer. The Company has significant Canadian operations but its assets are mostly held in the United States with an immaterial amount of long lived assets in Canada.
Net loss per common stock	(f) Net loss per common stock Basic net loss per common stock is computed by dividing loss by the weighted-average number of common stock outstanding during the period. Diluted net loss per common stock is determined using the weighted-average number of common stock outstanding during the period, adjusted for the dilutive effect of common stock equivalents, consisting of shares that might be issued upon exercise of common stock options and warrants. In periods where losses are reported, the weighted-average number of shares of common stock outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.
Recently issued and recently adopted accounting standards	(g) Recently issued and recently adopted accounting standards The Company adopted FASB ASU 2015-17 The Company adopted FASB ASU 2016-09 In January 2016, the FASB issued ASU 2016-01 825-10): 2016-01 2016-01 In February 2016, the FASB issued ASU 2016-02 right-of-use 2016-02, 2016-02 2016-02
Risks and uncertainties	(h) Risks and uncertainties The Company is subject to numerous risks and uncertainties. These risks, among others, included the following: • the Company has no source of revenue, had an accumulated deficit of $156,635 as of March 31, 2017, may never become profitable and may incur substantial and increasing net losses for the foreseeable future as it continues development of, seeks regulatory approvals for, and potentially begins to commercialize AQX-1125, • the Company is likely to require additional capital to finance its operations which may not be available to it on acceptable terms, or at all; • the Company’s success is primarily dependent on the successful development, regulatory approval and commercialization of AQX-1125, • SHIP1 has not been validated as a target; • the Company is subject to regulatory approval processes that are lengthy, time consuming and inherently unpredictable; the Company may not be able to obtain approval for AQX-1125 • the Company’s intellectual property rights may be subject to claims by third parties and can be difficult and costly to protect; • the Company may not be able to recruit or retain key employees, including its senior management team; • the Company depends on the performance of third parties, including contract research organizations and third-party manufacturers; and • the Company faces competition from other pharmaceutical and biotechnology companies, academic institutions, governmental agencies, and public and private research institutions, among others.

Cash and cash equivalents (Tabl

Cash and cash equivalents (Tables)	3 Months Ended
	Mar. 31, 2017
Cash and Cash Equivalents [Abstract]
Schedule of Cash and Cash Equivalents	MARCH 31, 2017 DECEMBER 31, Cash $ 18,686 $ 3,726 Cash equivalents 2,230 28,575 $ 20,916 $ 32,301

Other Liabilities (Tables)

Other Liabilities (Tables)	3 Months Ended
	Mar. 31, 2017
Other Liabilities Disclosure [Abstract]
Schedule of Other Liabilities	MARCH 31, 2017 DECEMBER 31, Capital lease obligations $ 44 $ 47 Deferred rent liability 518 150 $ 562 $ 197

Stockholders' equity (Tables)

Stockholders' equity (Tables)	3 Months Ended
	Mar. 31, 2017
Equity [Abstract]
Schedule of Stock Option Transactions and Number of Stock Options Outstanding	Stock option transactions and the number of stock options outstanding are summarized below: NUMBER OF SHARES WEIGHTED WEIGHTED (IN YEARS) AGGREGATE Outstanding at December 31, 2016 1,378,352 $ 9.38 7.81 $ 9,829 Options granted 696,100 17.35 Options forfeited (59,063 ) 12.37 Outstanding at March 31, 2017 2,015,389 $ 12.04 8.34 $ 9,806 Exercisable as of March 31, 2017 713,412 $ 9.26 6.44 $ 5,299
Schedule of Weighted Average Assumptions	The fair value of stock options granted is estimated using the Black-Scholes option pricing model with the following weighted average assumptions: THREE MONTHS ENDED 2017 2016 Expected volatility 91 % 80 % Expected dividends 0 % 0 % Expected terms (years) 6.00 6.00 Risk free rate 1.90 % 1.27 % Weighted average grant-date fair value of stock options $ 13.02 $ 5.67

Other income (Tables)

Other income (Tables)	3 Months Ended
	Mar. 31, 2017
Other Income and Expenses [Abstract]
Schedule of Other Income	THREE MONTHS ENDED 2017 2016 Change in fair value of derivative liability $ — $ 50 Foreign exchange losses (8 ) (26 ) Interest income 234 121 Miscellaneous expenses (20 ) (22 ) $ 206 $ 123

Net loss per common stock (Tabl

Net loss per common stock (Tables)	3 Months Ended
	Mar. 31, 2017
Earnings Per Share [Abstract]
Schedule of Antidilutive Securities Excluded from Computation of Basic and Diluted Net Loss Per Common Stock	The following have been excluded from the computation of basic and diluted net loss per common stock as their effect would have been antidilutive: THREE MONTHS ENDED MARCH 31, 2017 2016 Outstanding stock options 2,015,389 1,255,573 Common stock warrants — 11,363 Total 2,015,389 1,266,936

Financial instruments (Tables)

Financial instruments (Tables)	3 Months Ended
	Mar. 31, 2017
Investments, All Other Investments [Abstract]
Summary of Short-Term Investments and Long-Term Investments of Available-for-Sale Securities	The Company’s short-term investments and long-term investments consisted of available-for-sale Amortized cost Gross Gross Fair value March 31, 2017 Short-term investments: U.S. treasury securities $ 100,817 $ — $ (152 ) $ 100,665 Long-term investments: U.S. treasury securities $ 20,061 $ — $ (53 ) $ 20,008 Contractual maturities: Due within one year $ 100,817 $ 100,665 Due after one year through two years 20,061 20,008 December 31, 2016 Short-term investments: U.S. treasury securities $ 70,819 $ — $ (61 ) $ 70,758 Long-term investments: U.S. treasury securities $ 50,155 $ — $ (109 ) $ 50,046 Contractual maturities: Due within one year $ 70,819 $ 70,758 Due after one year through two years 50,155 50,046
Aggregate Estimated Fair Value of Investments with Unrealized Losses	The aggregate estimated fair value of the Company’s investments with unrealized losses are as follows: Period of continuous unrealized loss 12 months or less Greater than 12 months Fair value Gross Fair value Gross March 31, 2017 U.S. treasury securities $ 120,673 $ (205 ) N/A N/A December 31, 2016 U.S. treasury securities $ 120,804 $ (170 ) N/A N/A
Fair Value of Financial Instruments Measured At Fair Value on a Recurring Basis	The following tables present the fair value of our financial instruments that are measured at fair value on a recurring basis: QUOTED (LEVEL 1) OTHER (LEVEL 2) SIGNIFICANT UN- OBSERVABLE (LEVEL 3) TOTAL BALANCES – March 31, 2017 Short-term investments – U.S. treasury securities $ 100,665 $ — $ — $ 100,665 Long-term investments – U.S. treasury securities 20,008 — — 20,008 $ 120,673 $ — $ — $ 120,673 BALANCES – December 31, 2016 Short-term investments – U.S. treasury securities $ 70,758 $ — $ — $ 70,758 Long-term investments – U.S. treasury securities 50,046 — — 50,046 $ 120,804 $ — $ — $ 120,804

Nature of operations - Addition

Nature of operations - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2017
Aquinox Pharmaceuticals (USA) Inc. [Member]
Entity Information [Line Items]
Date of incorporation	May 31, 2007
Aquinox Pharmaceuticals (Canada) Inc. [Member]
Entity Information [Line Items]
Date of incorporation	Dec. 26, 2003

Condensed summary of signific22

Condensed summary of significant accounting policies - Additional Information (Detail) $ in Thousands	3 Months Ended
	Mar. 31, 2017USD ($)Segment	Dec. 31, 2016USD ($)
Accounting Policies [Abstract]
Operating segment | Segment	1
Accumulated deficit | $	$ 156,635	$ 148,278

Cash and cash equivalents - Sch

Cash and cash equivalents - Schedule of Cash and Cash Equivalents (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016	Mar. 31, 2016	Dec. 31, 2015
Cash and Cash Equivalents [Abstract]
Cash	$ 18,686	$ 3,726
Cash equivalents	2,230	28,575
Cash and cash equivalents	$ 20,916	$ 32,301	$ 35,691	$ 39,526

Other Liabilities - Schedule of

Other Liabilities - Schedule of Other Liabilities (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Other Liabilities [Abstract]
Capital lease obligations	$ 44	$ 47
Deferred rent liability	518	150
Other liabilities	$ 562	$ 197

Stockholders' equity - Addition

Stockholders' equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Equity Transactions And Share Based Compensation [Line Items]
Total number of shares authorized	55,000,000
Common stock, shares authorized	50,000,000		50,000,000
Common stock, par value	$ 0.000001		$ 0.000001
Preferred stock, shares authorized	5,000,000
Preferred stock, par value	$ 0.000001
Common stock, shares issued	23,423,150		23,423,150
Common stock, shares outstanding	23,423,150		23,423,150
Preferred stock, shares issued	0		0
Preferred stock, shares outstanding	0		0
Shares of common stock reserved for issuance description	Additionally, the number of shares of common stock reserved for issuance under the 2014 Plan will automatically increase on January 1 of each year for a period of up to 10 years, beginning on January 1, 2015 and ending on and including January 1, 2024, by 4% of the total number of shares of capital outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the board of directors.
Shares of common stock reserved for issuance percentage	4.00%
Years of increase in shares of common stock reserved for issuance	10 years
Stock options granted	696,100
Stock options granted, exercise price per share	$ 17.35
Common stock issued upon exercise of options	0
Stock-based compensation expense	$ 631	$ 433
Unrecognized stock-based compensation cost	$ 12,807	$ 4,839
Unrecognized stock-based compensation cost, weighted-average period recognized	3 years 4 months 2 days	3 years 2 months 16 days
Employees [Member]
Equity Transactions And Share Based Compensation [Line Items]
Stock options granted	696,100
Stock options granted, exercise price per share	$ 17.35
Employees [Member] | One Year after the Beginning of the Vesting Period [Member]
Equity Transactions And Share Based Compensation [Line Items]
Stock options, vesting percentage	25.00%
Employees [Member] | Condition (i) [Member]
Equity Transactions And Share Based Compensation [Line Items]
Stock options, vesting period	1 year
Employees [Member] | Condition (ii) [Member]
Equity Transactions And Share Based Compensation [Line Items]
Stock options, vesting period	3 years
Equity Incentive Plan 2014 [Member]
Equity Transactions And Share Based Compensation [Line Items]
Maximum number of shares of common stock that may be issued	2,890,063
Stock options, expiration period	10 years

Stockholders' equity - Schedule

Stockholders' equity - Schedule of Stock Option Transactions and Number of Stock Options Outstanding (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Options Outstanding, Number of Shares, beginning balance	1,378,352
Options granted, Number of Shares	696,100
Options forfeited, Number of Shares	(59,063)
Options Outstanding, Number of Shares, ending balance	2,015,389	1,378,352
Exercisable, Number of Shares, ending balance	713,412
Options Outstanding, Weighted Average Exercise Price, beginning balance	$ 9.38
Options granted, Weighted Average Exercise Price	17.35
Options forfeited, Weighted Average Exercise Price	12.37
Options Outstanding, Weighted Average Exercise Price, ending balance	12.04	$ 9.38
Exercisable, Weighted Average Exercise Price, ending balance	$ 9.26
Options Outstanding, Weighted Average Remaining Contractual Life (Years), ending balance	8 years 4 months 2 days	7 years 9 months 22 days
Exercisable, Weighted Average Remaining Contractual Life (Years), ending balance	6 years 5 months 9 days
Options Outstanding, Aggregate Intrinsic Value	$ 9,806	$ 9,829
Exercisable, Aggregate Intrinsic Value	$ 5,299

Stockholders' equity - Schedu27

Stockholders' equity - Schedule of Weighted Average Assumptions (Detail) - $ / shares	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Expected volatility	91.00%	80.00%
Expected dividends	0.00%	0.00%
Expected terms (years)	6 years	6 years
Risk free rate	1.90%	1.27%
Weighted average grant-date fair value of stock options	$ 13.02	$ 5.67

Other Income - Schedule of Othe

Other Income - Schedule of Other Income (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Other Income and Expenses [Abstract]
Change in fair value of derivative liability		$ 50
Foreign exchange losses	$ (8)	(26)
Interest income	234	121
Miscellaneous expenses	(20)	(22)
Other income (expenses)	$ 206	$ 123

Net loss per common stock - Sch

Net loss per common stock - Schedule of Antidilutive Securities Excluded from Computation of Basic and Diluted Net Loss Per Common Stock (Detail) - shares	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from the computation of basic and diluted net loss per share	2,015,389	1,266,936
Outstanding Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from the computation of basic and diluted net loss per share	2,015,389	1,255,573
Warrants to Purchase Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from the computation of basic and diluted net loss per share		11,363

Financial instruments - Summary

Financial instruments - Summary of Short-Term Investments and Long-Term Investments of Available-for-Sale Securities (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Due within one year, Amortized cost	$ 100,817	$ 70,819
Due within one year, Fair value	100,665	70,758
Due after one year through two years, Amortized cost	20,061	50,155
Due after one year through two years, Fair value	20,008	50,046
Short-term Investments [Member] | U.S. Treasury Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	100,817	70,819
Gross unrealized gains	0	0
Gross unrealized losses	(152)	(61)
Fair value	100,665	70,758
Long-term Investments [Member] | U.S. Treasury Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	20,061	50,155
Gross unrealized gains	0	0
Gross unrealized losses	(53)	(109)
Fair value	$ 20,008	$ 50,046

Financial instruments - Aggrega

Financial instruments - Aggregate Estimated Fair Value of Investments with Unrealized Losses (Detail) - U.S. Treasury Securities [Member] - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Period of continuous unrealized loss, 12 months or less, Fair value	$ 120,673	$ 120,804
Period of continuous unrealized loss, 12 months or less, Gross unrealized losses	(205)	(170)
Period of continuous unrealized loss, Greater than 12 months, Fair value	0	0
Period of continuous unrealized loss, Greater than 12 months, Gross unrealized losses	$ 0	$ 0

Financial instruments - Fair Va

Financial instruments - Fair Value of Financial Instruments Measured At Fair Value on a Recurring Basis (Detail) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	$ 100,665	$ 70,758
Long-term investments	20,008	50,046
Fair Value of Financial instruments	120,673	120,804
U.S. Treasury Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	100,665	70,758
Long-term investments	20,008	50,046
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value of Financial instruments	120,673	120,804
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value, Measurements, Recurring [Member] | U.S. Treasury Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	100,665	70,758
Long-term investments	$ 20,008	$ 50,046

Financial instruments - Additio

Financial instruments - Additional Information (Detail) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value of Financial instruments	$ 120,673,000		$ 120,804,000
Transfers between Levels 1, 2 and 3	0		0
Short term investments consisting of available for sale securities	100,665,000		70,758,000
Long-term investments consisting of available for sale securities	20,008,000		50,046,000
Net realized gains for securities	224,000	$ 119,000
Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value of Financial instruments	0		0
Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value of Financial instruments	$ 0		$ 0