Ardelyx (ARDX) 10-Q 6 Nov 19 2019 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2019	Nov. 01, 2019
Document And Entity Information [Abstract]
Entity Registrant Name	ARDELYX, INC.
Entity Central Index Key	0001437402
Document Type	10-Q
Document Period End Date	Sep. 30, 2019
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Amendment Flag	false
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		62,908,080

Condensed Balance Sheets

Condensed Balance Sheets - USD ($) $ in Thousands		Sep. 30, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents		$ 92,673	$ 78,768	[1]
Short-term investments		10,870	89,321	[1]
Accounts receivable		2,699	85	[1]
Unbilled license revenue	[1]		5,000
Prepaid expenses and other current assets		4,592	3,197	[1]
Total current assets		110,834	176,371	[1]
Property and equipment, net		3,943	5,611	[1]
Right-of-use assets		4,453
Other assets		180	1,350	[1]
Total assets		119,410	183,332	[1]
Current liabilities:
Accounts payable		2,689	1,148	[1]
Accrued compensation and benefits		2,804	2,723	[1]
Uncharged license fees	[1]		1,000
Current portion of operating lease liability		2,504
Accrued and other liabilities		9,682	12,857	[1]
Total current liabilities		17,679	17,728	[1]
Operating lease liability, net of current portion		2,770
Loan payable, long term		49,803	49,209	[1]
Other long-term liabilities	[1]		582
Total liabilities		70,252	67,519	[1]
Commitments and contingencies				[1]
Stockholders' equity:
Preferred stock, $0.0001 par value; 5,000,000 shares authorized; no shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively				[1]
Common stock, $0.0001 par value; 300,000,000 shares authorized; 62,883,080 and 62,516,627 shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively.		6	6	[1]
Additional paid-in capital		489,810	481,357	[1]
Accumulated deficit		(440,662)	(365,512)	[1]
Accumulated other comprehensive income (loss)		4	(38)	[1]
Total stockholders' equity		49,158	115,813	[1]
Total liabilities and stockholders' equity		$ 119,410	$ 183,332	[1]
[1]	Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10K for the year ended December 31, 2018.

Condensed Balance Sheets (Paren

Condensed Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2019	Dec. 31, 2018
Condensed Balance Sheets
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares issued	62,883,080	62,516,627
Common stock, shares outstanding	62,883,080	62,516,627

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Revenues:
Total revenues	$ 3,013	$ 172	$ 3,031	$ 2,522
Cost of revenue	600	2	600	466
Gross profit	2,413	170	2,431	2,056
Operating expenses:
Research and development	17,580	17,941	57,436	47,337
General and administrative	6,922	5,961	17,410	18,290
Total operating expenses	24,502	23,902	74,846	65,627
Loss from operations	(22,089)	(23,732)	(72,415)	(63,571)
Interest expense	(1,443)	(1,404)	(4,328)	(2,096)
Other income (expense), net	294	1,010	1,896	2,237
Loss before provision for income taxes	(23,238)	(24,126)	(74,847)	(63,430)
Provision for income taxes	301		303	6
Net loss	$ (23,539)	$ (24,126)	$ (75,150)	$ (63,436)
Net loss per common share, basic and diluted	$ (0.37)	$ (0.39)	$ (1.20)	$ (1.17)
Shares used in computing net loss per share - basic and diluted	62,828,513	62,071,397	62,676,591	54,204,907
Comprehensive loss:
Net loss	$ (23,539)	$ (24,126)	$ (75,150)	$ (63,436)
Unrealized (loss) gain on available-for-sale securities, net of tax	(12)	19	42	30
Comprehensive loss	(23,551)	(24,107)	(75,108)	(63,406)
Licensing
Revenues:
Total revenues	3,000		3,000	2,320
Other
Revenues:
Total revenue	$ 13	$ 172	$ 31	$ 202

Condensed Statements of Changes

Condensed Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Common Stock [Member]Underwriters' option	Common Stock [Member]Restricted Stock Units (RSUs) [Member]	Common Stock [Member]	Additional Paid-In Capital [Member]Underwriters' option	Additional Paid-In Capital [Member]	Accumulated Deficit [Member]	Other Comprehensive Income (Loss) [Member]	Underwriters' option	Total
Balance, amount at Dec. 31, 2017			$ 5		$ 417,568	$ (278,214)	$ (47)		$ 139,312
Balance, shares at Dec. 31, 2017			47,534,979
Issuance of common stock under employee stock purchase plan, amount			$ 0		492				492
Issuance of common stock under employee stock purchase plan, shares			120,959
Issuance of common stock for services, amount					304				$ 304
Issuance of common stock for services, shares			75,183						75,183
Stock-based compensation					6,976				$ 6,976
Other comprehensive loss							30		30
Issuance of common stock, value	$ 1			$ 53,769				$ 53,770
Issuance of common stock, shares	14,375,000
Net loss						(63,436)			(63,436)
Balance, amount at Sep. 30, 2018			$ 6		479,109	(337,650)	(17)		141,448
Balance, shares at Sep. 30, 2018			62,106,121
Balance, amount at Jun. 30, 2018			$ 6		476,968	(313,524)	(36)		163,414
Balance, shares at Jun. 30, 2018			62,053,751
Issuance of common stock under employee stock purchase plan, amount					193				193
Issuance of common stock under employee stock purchase plan, shares			52,370
Issuance of common stock for services, amount									$ 300
Issuance of common stock for services, shares									0
Stock-based compensation					1,948				$ 1,948
Other comprehensive loss							19		19
Net loss						(24,126)			(24,126)
Balance, amount at Sep. 30, 2018			$ 6		479,109	(337,650)	(17)		141,448
Balance, shares at Sep. 30, 2018			62,106,121
Adoption of ASU No. 2014-09 on January 1, 2018						4,000			4,000
Balance, amount at Dec. 31, 2018			$ 6		481,357	(365,512)	(38)		115,813	[1]
Balance, shares at Dec. 31, 2018			62,516,627
Issuance of common stock under employee stock purchase plan, amount					397				397
Issuance of common stock under employee stock purchase plan, shares			160,744
Issuance of common stock for services, amount					311				$ 311
Issuance of common stock for services, shares			113,136						113,136
Issuance of common stock upon exercise of options					21				$ 21
Issuance of common stock upon exercise of options, shares			6,964
Stock-based compensation					7,724				7,724
Other comprehensive loss							42		42
Issuance of common stock, shares		85,609
Net loss						(75,150)			(75,150)
Balance, amount at Sep. 30, 2019			$ 6		489,810	(440,662)	4		49,158
Balance, shares at Sep. 30, 2019			62,883,080
Balance, amount at Jun. 30, 2019			$ 6		485,718	(417,123)	16		68,617
Balance, shares at Jun. 30, 2019			62,800,869
Issuance of common stock under employee stock purchase plan, amount					200				200
Issuance of common stock under employee stock purchase plan, shares			77,698
Issuance of common stock for services, amount									$ 300
Issuance of common stock for services, shares									0
Issuance of common stock upon exercise of options					13				$ 13
Issuance of common stock upon exercise of options, shares			4,513
Stock-based compensation					3,879				3,879
Other comprehensive loss							(12)		(12)
Net loss						(23,539)			(23,539)
Balance, amount at Sep. 30, 2019			$ 6		$ 489,810	$ (440,662)	$ 4		$ 49,158
Balance, shares at Sep. 30, 2019			62,883,080
[1]	Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10K for the year ended December 31, 2018.

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019		Sep. 30, 2018
Operating activities
Net loss	$ (75,150)		$ (63,436)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	1,993		2,005
Amortization of deferred financing costs	550		144
Amortization of deferred compensation for services	231		177
Amortization of premium on investment securities	(666)		(708)
Non-cash lease expense	1,356
Stock-based compensation	7,724		6,976
Change in derivative liabilities	246		56
Non-cash interest associated with debt discount accretion	353		164
Changes in operating assets and liabilities:
Accounts receivable and unbilled license revenue	2,386		10,629
Prepaid expenses and other assets	(454)		(3,908)
Accounts payable	541		(1,609)
Accrued compensation and benefits	81		(923)
Lease liabilities	(1,301)
Accrued and other liabilities	(3,237)		(1,405)
Net cash used in operating activities	(65,347)		(51,838)
Investing activities
Proceeds from maturities of investments	114,484		95,450
Sales and redemptions of investments	1,000		850
Purchases of investments	(36,325)		(148,360)
Purchases of property and equipment	(325)		(24)
Net cash provided by (used in) investing activities	78,834		(52,084)
Financing activities
Proceeds from loan payable, net of issuance costs			49,292
Proceeds from underwritten public offering, net of issuance costs			53,770
Issuance of common stock upon exercise of options	21
Proceeds from issuance of common stock under stock plans	397		492
Net cash provided by financing activities	418		103,554
Net increase (decrease) in cash and cash equivalents	13,905		(368)
Cash and cash equivalents at beginning of period	78,768	[1]	75,383
Cash and cash equivalents at end of period	$ 92,673		75,015
Supplementary disclosure of non-cash financing information:
Issuance of derivative in connection with issuance of loan payable			$ 546
[1]	Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10K for the year ended December 31, 2018.

Organization and Basis of Prese

Organization and Basis of Presentation	9 Months Ended
	Sep. 30, 2019
Organization and Basis of Presentation
Organization and Basis of Presentation	NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION Ardelyx, Inc. (the “Company,” “we,” “us” or “our”) is a specialized biopharmaceutical company focused on developing first-in-class medicines to improve treatment choices for people with cardiorenal diseases. Tenapanor, a first-in-class inhibitor of NHE3, is being evaluated in a Phase 3 clinical program, including, the PHREEDOM trial, a second Phase 3 clinical trial evaluating tenapanor as a monotherapy treatment for hyperphosphatemia in patients with chronic kidney disease, or CKD, who are on dialysis. O n September 3, 2019, the Company reported positive results from the AMPLIFY trial, a Phase 3 study of tenapanor in combination with phosphate binders in patients with CKD on dialysis whose hyperphosphatemia was not previously controlled with binders alone. On September 12, 2019, the Company announced that the U.S. Food and Drug Administration, or FDA, approved IBSRELA (tenapanor), a 50 mg, twice daily oral pill for the treatment of irritable bowel syndrome with constipation, or IBS-C, in adults. The Company intends to find a collaboration partner to commercialize IBSRELA in the United States. The Company is also advancing a small molecule potassium secretagogue program, RDX013, for the potential treatment of hyperkalemia. The Company operates in only one business segment, which is the development of biopharmaceutical products. Basis of Presentation These unaudited condensed consolidated financial statements and the related footnote information of the Company have been prepared pursuant to the requirements of the Securities and Exchange Commission, or the SEC, for interim reporting. As permitted under those rules and regulations, certain footnotes or other financial information that are normally required by U.S. generally accepted accounting principles, or U.S. GAAP, have been condensed or omitted pursuant to such rules and regulations. In the opinion of the Company’s management, the accompanying interim unaudited condensed consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the information for the periods presented. The results for the three and nine months ended September 30, 2019, are not necessarily indicative of results to be expected for the entire year ending December 31, 2019, or future operating periods. The accompanying condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2018, included in the Company’s Annual Report on Form 10‑K filed with the SEC (the “2018 Form 10‑K”). The balance sheet at December 31, 2018, has been derived from the audited consolidated financial statements at that date, as filed with the 2018 Form 10‑K. The accompanying condensed consolidated financial statements include the accounts of Ardelyx, Inc. and its wholly-owned subsidiary, Ardelyx Cayman Islands, which was placed into voluntary liquidation in December 2017 and dissolved in April 2018, have been prepared in accordance with U.S. GAAP. Intercompany transactions and balances have been eliminated upon consolidation. Prior Period Errors During the second quarter of 2019, errors were identified in our consolidated financial statements for the quarter ended March 31, 2019, for year ended December 31, 2018 and for each of the quarterly periods ended March 31, 2018, June 30, 2018 and September 30, 2018. The errors were related to the accounting for clinical trial accruals and resulted in an overstatement of research and development expenses during these periods. Research and development expenses were overstated by $0.2 million, $0.9 million, $1.1 million, $1.4 million and $0.5 million for the three-month periods ended March 31, 2018, June 30, 2018, September 30, 2018, December 31, 2018 and March 31, 2019, respectively. As of December 31, 2018, accrued and other liabilities was overstated by $3.6 million. The Company analyzed the potential impact of these errors and concluded that while the accumulated errors were significant to the results for the three months ended June 30, 2019, a correction of the errors would not be material to any individual prior period, taking into account the requirements of the SEC Staff Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. In accordance with the authoritative guidance, management evaluated the materiality of the errors from a qualitative and quantitative perspective. Based on such evaluation, the Company concluded that correcting the cumulative errors for the year ended December 31, 2018 is expected to be immaterial to the currently estimated full year results for 2019 and a correction of the errors would not have a material impact on the periods ended March 31, 2018, June 30, 2018, September 30, 2018, December 31, 2018 and March 31, 2019 or affect the trend of financial results. Accordingly, during the second quarter of 2019, the Company reduced accrued and other liabilities by $4.1 million and recorded a cumulative adjustment of $4.1 million in the condensed consolidated statement of operations to reduce research and development expenses.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2019
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and judgments that affect the amounts reported in the consolidated financial statements and accompanying notes. On an ongoing basis, management evaluates its estimates, including those related to recognition of revenue, clinical trial accruals, contract manufacturing accruals, fair value of assets and liabilities, income taxes and stock-based compensation. Management bases its estimates on historical experience and on various other market-specific and relevant assumptions that management believes to be reasonable under the circumstances. Actual results could materially differ from those estimates. Accrued Research and Development Expenses As part of the process of preparing its financial statements, the Company is required to estimate its accrued expenses. This process involves reviewing open contracts and purchase orders, communicating with its personnel to identify services that have been performed on its behalf and estimating the level of service performed and the associated cost incurred for the service when the Company has not yet been invoiced or otherwise notified of the actual cost. The majority of the Company’s service providers submit its monthly invoices in arrears for services performed or when contractual milestones are met. The Company makes estimates of its accrued expenses as of each balance sheet date in its financial statements based on facts and circumstances known to the Company at that time. The Company periodically confirms the accuracy of its estimates with the service providers and makes adjustments if necessary. Examples of estimated accrued research and development expenses include fees paid to: · contract research organizations, or CROs, in connection with clinical studies; · investigative sites in connection with clinical studies; · vendors related to product manufacturing, development and distribution of clinical supplies; and · vendors in connection with preclinical development activities. The Company records expenses related to clinical studies and manufacturing development activities based on its estimates of the services received and efforts expended pursuant to contracts with multiple CROs and manufacturing vendors that conduct and manage these activities on its behalf. The financial terms of these agreements are subject to negotiation, vary from contract to contract, and may result in uneven payment flows. There may be instances in which payments made to the Company’s vendors will exceed the level of services provided and result in a prepayment of the expense. Payments under some of these contracts depend on factors such as the successful enrollment of subjects and the completion of clinical trial milestones. In accruing service fees, the Company estimates the time period over which services will be performed, enrollment of subjects, number of sites activated and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the Company’s estimate, the Company will adjust the accrued or prepaid expense balance accordingly. To date, there have been no material differences from the Company’s estimates to the amounts actually incurred. Revenue Recognition On January 1, 2018 the Company adopted the new standard for Revenue from Contracts with Customers, ASC 606, on a modified retrospective method as an adjustment to the opening balance of retained earnings of the annual reporting period. As a result of the adoption of the new standard, on January 1, 2018, the Company had recorded the following: (i) unbilled license revenue under current assets of $5.0 million representing a future receivable related to the first milestone under the Company’s license agreement with Kyowa Kirin Co., Ltd., or KKC (formerly known as Kyowa Hakko Kirin Co., Ltd, or KHK), which was subsequently achieved by KKC and collected in February 2019, thereby reducing the unbilled license revenue balance to zero, (ii) uncharged license fees under current liabilities of $1.0 million representing the corresponding future payable related to AstraZeneca AB, or AstraZeneca, in accordance with the Company’s termination agreement with AstraZeneca, which, upon KKC achieving the milestone, was reclassified to accounts payable and subsequently paid to AstraZeneca during the three months ended June 30, 2019, and (iii) a related decrease in accumulated deficit of approximately $4.0 million as the new standard permitted revenue from milestones that possess certain criteria to be recognized earlier and also contained different recognition criteria related to milestones than under the previous standard, Revenue Recognition, Multiple-Element Arrangements - Licensing revenues , ASC 605. The Company enters into license agreements which are within the scope of ASC 606, under which it licenses certain rights to its product candidates to third parties. The terms of these arrangements typically include payment to the Company of one or more of the following: non-refundable, up-front license fees; development, regulatory and commercial milestone payments; and future royalties on net sales of licensed products. Each of these payments results in license, collaboration and other revenues, except for revenues from royalties on net sales of licensed products, which are classified as royalty revenues. In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. As part of the accounting for these arrangements, the Company must develop assumptions that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. The Company uses key assumptions to determine the stand-alone selling price, which may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success. Milestone Payments: At the inception of each arrangement that includes development milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. Amounts of variable consideration are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur and when the uncertainty associated with the variable consideration is subsequently resolved. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The transaction price is then allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development milestones and any related constraint, and if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect license, collaboration and other revenues and earnings in the period of adjustment. At each reporting period, the variable consideration related to the remaining development milestone payments is not included in the transaction price as these are fully constrained as of that period end date. As part of its evaluation of the constraint, the Company considers numerous factors, including that receipt of the milestones is outside the control of the Company and contingent upon success in future clinical trials and collaboration partner’s efforts. Any variable consideration related to sales-based milestones (including royalties) will be recognized when the related sales occur as they were determined to relate predominantly to the license granted to the collaboration partner. The Company re-evaluates the transaction price in each reporting period and as uncertain events are resolved or other changes in circumstances occur. Manufacturing Supply Services: Arrangements that include a promise for future supply of drug substance or drug product for either clinical development or commercial supply at the customer’s discretion are generally considered as options. The Company assess if these options provide a material right to the licensee and if so, they are accounted for as separate performance obligations. If the Company is entitled to additional payments when the customer exercises these options, any payments are recorded in other revenues when the customer obtains control of the goods, which is upon delivery. Royalties: For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes 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). To date, the Company has not recognized any royalty revenue resulting from any of its licensing arrangements. Derivatives and Hedging Activities The Company accounts for its derivative instruments as either assets or liabilities on the condensed balance sheet and measures them at fair value. Derivatives are adjusted to fair value through other income (expense), net in the condensed consolidated statements of operations and comprehensive loss. Leases We determine if an arrangement is a lease at the inception of the arrangement. Operating leases are included in right-of-use assets, current portion of operating lease liability, and operating lease liability, net of current portion in our condensed balance sheets. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments, we use our incremental borrowing rate based on the information available at the lease commencement date. The operating lease right-of-use assets also include any lease payments made and exclude lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise any such options. Lease expense is recognized on a straight-line basis over the expected lease term. On January 1, 2019, we adopted ASU No. 2016-02, Leases ( Topic 842) using the optional transition method to initially account for the impact of the adoption with a cumulative adjustment to accrued and other liabilities and other long-term liabilities. We elected the package of practical expedients, which among other things, allowed us not to reassess the following: whether any expired or existing contracts were considered or contained leases; the lease classification for any expired or existing leases; or initial direct costs for any existing leases. For our building leases, we also elected the practical expedient not to separate lease and non-lease components, such as common area maintenance charges, and instead we account for these as a single lease component. Recent Accounting Pronouncements New Accounting Pronouncements - Recently Adopted On January 1, 2019, the Company adopted ASU 2018-07, Compensation – Stock Compensation (Topic 718). This update simplifies the accounting for share-based payments to non-employees by aligning it with the accounting guidance for share-based payments for employees. The ASU expands the scope of Topic 718, Compensation – Stock Compensation, which currently only includes share-based payments issued to employees, to also include share-based payments issued to non-employees for goods and services. Consequently, the accounting for share-based payments to non-employees and employees is substantially aligned. The adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements. In August 2018, the SEC adopted amendments to certain disclosure requirements in Securities Act Release No. 33-10532, Disclosure Update and Simplification. These amendments eliminate, modify, or integrate into other SEC requirements certain disclosure rules. Among the amendments is the requirement to present an analysis of changes in stockholders’ equity in the interim financial statements included in quarterly reports on Form 10-Q. The analysis, which can be presented as a footnote or separate statement, is required for the current and comparative quarter and year-to-date interim periods. The amendments are effective for all filings made on or after November 5, 2018. In light of the anticipated timing of effectiveness of the amendments and expected proximity of effectiveness to the filing date for most filers’ quarterly reports, the SEC’s Division of Corporate Finance issued a Compliance and Disclosure Interpretation related to Exchange Act Forms, or CDI – Question 105.09, that provides transition guidance related to this disclosure requirement. CDI – Question 105.09 states that the SEC would not object if the filer’s first presentation of the changes in shareholders’ equity is included in its Form 10-Q for the quarter that begins after the effective date of the amendments. As such, the Company adopted these SEC amendments on November 5, 2018 and started presenting the analysis of changes in stockholders’ equity starting in its Quarterly Report on Form 10-Q for the period ended March 31, 2019. The adoption of these SEC amendments did not have a material effect on the Company’s financial position, results of operations, cash flows or shareholders’ equity. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (ASU 2016-02), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements, or ASU No. 2018-11. In issuing ASU No. 2018-11, the FASB is permitting another transition method for ASU 2016-02, which allows the transition to the new lease standard by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. We elected the transition method and package of practical expedients permitted under the transition guidance, which allowed us to carryforward our historical lease classification, our assessment on whether a contract is or contains a lease, and our initial direct costs for any leases that exist prior to adoption of the new standard. We also elected to combine lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the statements of operations on a straight-line basis over the lease term. We adopted the ASU on January 1, 2019 using a modified retrospective approach and recorded a right-of-use asset and a corresponding lease liability to account for our facility lease as a cumulative-effect adjustment to the opening balance of accrued and other liabilities and other long-term liabilities in the period of adoption. Impact of Adoption The Company, on adopting ASU 2016-02 - Leases (Topic 842) on January 1, 2019, has used the modified retrospective approach with the cumulative effect of initially applying the standard as an adjustment to the opening balance of accrued and other liabilities and other long-term liabilities. The following adjustments were recorded in the opening balance on January 1, 2019 (in thousands): December 31, Adjustments January 1, 2018 Due to Topic 842 2019 Right-of-use assets $ — 5,810 $ 5,810 Current portion of operating lease liability — 1,892 1,892 Operating lease liability, net of current portion — 4,684 4,684 Accrued and other liabilities 12,857 (184) 12,673 Other long-term liabilities $ 582 (582) $ — As a result of adopting Topic 842 on January 1, 2019, the following financial statement line items in the Company’s condensed balance sheet at September 30, 2019 and the condensed consolidated statement of operations and comprehensive loss for the nine months ended September 30, 2019 were affected (in thousands): September 30, 2019 As Reported under Topic 842 Under Topic 840 Effect of Change Right-of-use assets $ 4,453 — $ 4,453 Current portion of operating lease liability 2,504 — 2,504 Operating lease liability, net of current portion 2,770 — 2,770 Accrued and other liabilities 9,682 9,989 (307) Other long-term liabilities $ — 349 $ (349) Nine Months Ended September 30, 2019 As Reported under Topic 842 Under Topic 840 Effect of Change Operating expenses: General and administrative related to leases $ 1,944 1,779 $ 165 In June 2018, the FASB issued ASU No. 2018-07, Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting . ASU 2018-07 is intended to reduce the cost and complexity and to improve financial reporting for nonemployee share-based payments. ASU 2018-07 expands the scope of Topic 718, Compensation-Stock Compensation (which currently only includes share-based payments to employees) to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. ASU 2018-07 supersedes Subtopic 505-50, Equity-Based Payments to Non-Employees. ASU 2018-07 is effective for the Company for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year and early adoption is permitted. On January 1, 2019, we adopted ASU 2018-07 and the adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements. New Accounting Pronouncements Not Yet Adopted In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 . The guidance clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue under Topic 606 when the collaborative arrangement participant is a customer. For the Company, the amendment will be effective January 1, 2020. The Company is evaluating the impact this guidance will have on its consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU No. 2018-15 Intangibles (Topic 350): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract , which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This new standard also requires customers to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. This ASU is effective for public companies for fiscal years beginning after December 15, 2019. This new standard can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is currently evaluating the impact of adoption of this ASU on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement . ASU 2018-13 considers cost and benefits, and removes, modifies and adds disclosure requirements in Topic 820. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty is to be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments are to be applied retrospectively to all periods presented. ASU 2018-13 is effective for the Company for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year and early adoption is permitted. The Company is currently assessing the impact of this standard on its consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , an amendment which modifies the measurement and recognition of credit losses for most financial assets and certain other instruments. The amendment updates the guidance for measuring and recording credit losses on financial assets measured at amortized cost by replacing the “incurred loss” model with an “expected loss” model. Accordingly, these financial assets will be presented at the net amount expected to be collected. The amendment also requires that credit losses related to available-for-sale debt securities be recorded as an allowance through net income rather than reducing the carrying amount under the current, other-than-temporary-impairment model. The guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for annual periods after December 15, 2018. The Company is currently evaluating the impact of adoption of this ASU on its condensed consolidated financial statements. The Company has reviewed all other significant newly-issued accounting pronouncements and concluded that they either are not applicable to the Company’s operations or no material effect is expected on its condensed consolidated financial statements as a result of future adoption.

Cash, Cash Equivalents and Inve

Cash, Cash Equivalents and Investments	9 Months Ended
	Sep. 30, 2019
Cash, Cash Equivalents and Investments
Cash, Cash Equivalents and Investments	NOTE 3. CASH, CASH EQUIVALENTS AND INVESTMENTS Securities classified as cash, cash equivalents and short-term investments as of September 30, 2019 and December 31, 2018, are summarized below (in thousands). Estimated fair value is based on quoted market prices for these investments. September 30, 2019 Gross Unrealized Amortized Cost Gains Losses Fair Value Cash and cash equivalents: Cash $ 3,595 — — $ 3,595 Money market funds 89,078 — — 89,078 Total cash and cash equivalents $ 92,673 $ — $ — $ 92,673 Short-term investments Corporate bonds 3,324 1 — 3,325 Commercial paper 6,234 2 — 6,236 Asset-backed securities 1,308 1 — 1,309 Total short-term investments $ 10,866 $ 4 $ — $ 10,870 Total cash equivalents and investments $ 103,539 $ 4 $ — $ 103,543 December 31, 2018 Gross Unrealized Amortized Cost Gains Losses Fair Value Cash and cash equivalents: Cash $ 3,733 $ — $ — $ 3,733 Money market funds 73,238 — — 73,238 Commercial paper 1,797 — — 1,797 Total cash equivalents and investments $ 78,768 $ — $ — $ 78,768 Short-term investments U.S. treasury securities $ 3,996 — — $ 3,996 Corporate bonds 34,611 — (21) 34,590 Commercial paper 41,371 — (14) 41,357 Asset-backed securities 9,381 — (3) 9,378 Total short-term investments $ 89,359 $ — $ (38) $ 89,321 Total cash equivalents and investments $ 168,127 $ — $ (38) $ 168,089 Cash equivalents consist of money market funds and other debt securities with original maturities of three months or less at the time of purchase, and the carrying amount is a reasonable approximation of fair value. The Company invests its cash in high quality securities of financial and commercial institutions. These securities are carried at fair value, which is based on readily available market information, with unrealized gains and losses included in “accumulated other comprehensive loss” within stockholders’ equity on the Company’s condensed balance sheets. The Company uses the specific identification method to determine the amount of realized gains or losses on sales of marketable securities. Realized gains or losses have been insignificant and are included in other income (expense), net, in the consolidated condensed statement of operations. All available-for-sale securities held as of September 30, 2019, had contractual maturities of less than one year. The Company’s available-for-sale securities are subject to a periodic impairment review. The Company considers a debt security to be impaired when its fair value is less than its carrying cost, in which case the Company would further review the investment to determine whether it is other-than-temporarily impaired. When the Company evaluates an investment for other-than-temporary impairment, the Company reviews factors such as the length of time and extent to which fair value has been below cost basis, the financial condition of the issuer and any changes thereto, intent to sell, and whether it is more likely than not the Company will be required to sell the investment before the recovery of its cost basis. If an investment is other-than-temporarily impaired, the Company writes it down through the statement of operations to its fair value and establishes that value as a new cost basis for the investment. The Company did not identify any of its available-for-sale securities as other-than-temporarily impaired in any of the periods presented. As of September 30, 2019, no investment was in a continuous unrealized loss position for more than one year and the Company believes that it is more likely than not that the investments will be held until maturity or a forecasted recovery of fair value.

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Sep. 30, 2019
Fair Value Measurements
Fair Value Measurements	NOTE 4. FAIR VALUE MEASUREMENTS Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The three-level hierarchy for the inputs to valuation techniques is briefly summarized as follows: Level 1 – Valuations are based on quoted prices in active markets for identical assets or liabilities and readily accessible by the Company at the reporting date. Examples of assets and liabilities utilizing Level 1 inputs are certain money market funds, U.S. Treasuries and trading securities with quoted prices on active markets. Level 2 – Valuations based on 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. Examples of assets and liabilities utilizing Level 2 inputs are corporate bonds, commercial paper, certificates of deposit and over-the-counter derivatives. Level 3 – Valuations based on unobservable inputs in which there is little or no market data, which require the Company to develop its own assumptions. The following table sets forth the fair value of the Company’s financial assets and liabilities measured on a recurring basis by level within the fair value hierarchy (in thousands): September 30, 2019 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 89,078 $ 89,078 $ — $ — Corporate bonds 3,325 — 3,325 — Commercial paper 6,236 — 6,236 — Asset-backed securities 1,309 — 1,309 — Total $ 99,948 $ 89,078 $ 10,870 $ — Liabilities: Derivative liability for exit fee $ 779 $ — $ — $ 779 Total $ 779 $ — $ — $ 779 December 31, 2018 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 73,238 $ 73,238 $ — $ — U.S. treasury securities 3,996 3,996 — — Corporate bonds 34,590 — 34,590 — Commercial paper 43,154 — 43,154 — Asset-backed securities 9,378 — 9,378 — Total $ 164,356 $ 77,234 $ 87,122 $ — Liabilities: Derivative liability for exit fee $ 533 $ — $ — $ 533 Foreign currency derivative contracts 52 $ — $ 52 $ — Total $ 585 $ — $ 52 $ 533 Where quoted prices are available in an active market, securities are classified as Level 1. The Company classifies money market funds, U.S. treasury securities and U.S. treasury notes as Level 1. When quoted market prices are not available for the specific security, the Company estimates fair value by using benchmark yields, reported trades, broker/dealer quotes and issuer spreads. The Company classifies corporate bonds, commercial paper, asset-backed securities and foreign currency derivative contracts as Level 2. In certain cases, where there is limited activity or less transparency around inputs to valuation, securities are classified as Level 3. There were no transfers between Level 1 and Level 2 during the periods presented. In May 2018, pursuant to the loan and security agreement with Solar Capital Ltd. and Western Alliance Bank (see “Note 6. Borrowings”), the Company entered into an Exit Fee Agreement under which the Company agreed to pay $1.5 million in cash, or the Exit Fee, upon any change of control transaction in respect of the Company or if the Company obtains both (i) FDA approval of tenapanor for the treatment of hyperphosphatemia in CKD patients on dialysis and (ii) FDA approval of tenapanor for the treatment of patients with IBS-C, which was obtained on September 12, 2019 when the FDA approved IBSRELA (tenapanor), a 50 mg, twice daily oral pill for the treatment of IBS-C, in adults. Notwithstanding the prepayment or termination of the Term Loan, the Company’s obligation to pay the Exit Fee will expire May 16, 2028. The Company evaluated that the Exit Fee is a freestanding derivative which should be accounted for at fair value on a recurring basis. The estimated fair value of the Exit Fee is recorded as a derivative liability and included in accrued and other liabilities on the accompanying condensed balance sheets. As of September 30, 2019, the estimated fair value of the Exit Fee was determined to be $779,000, an increase of $246,000 compared with $533,000 , the estimated fair value as of December 31, 2018 , primarily as a result of changes to the inputs in the calculation including the probability of success and the time value of money, which are presented as a component of change in derivative liabilities in the Company’s condensed consolidated statements of operations. The fair value of the derivative liability was determined using a discounted cash flow analysis and is classified as a Level 3 measurement within the fair value hierarchy since the Company’s valuation utilized significant unobservable inputs. Specifically, the key assumptions included in the calculation of the estimated fair value of the derivative instrument include: i) the Company’s estimates of both the probability and timing of a potential $1.5 million payment to Solar Capital Ltd. and Western Alliance Bank as a result of the FDA approvals, and ii) a discount rate which was derived from the Company's estimated cost of debt. Generally, increases or decreases in the probability of occurrence would result in a directionally similar impact in the fair value measurement of the derivative instrument and it is estimated that a 10% increase (decrease) in the probability of occurrence would result in a fair value fluctuation of approximately $0.1 million. Changes in the fair value of recurring measurements included in Level 3 of the fair value hierarchy are presented as other income (expense), net, in the Company's condensed consolidated statements of operations and were as follows for the three and nine months ended September 30, 2019 (in thousands): Estimated Fair Value of Derivative Liability Balance of Level 3 Liabilities at December 31, 2018 $ 533 Change in estimated fair value of derivative liability for exit fee 246 Balance of Level 3 Liabilities at September 30, 2019 $ 779 The carrying amounts reflected in the balance sheets for cash equivalents, short-term investments, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their fair values at both September 30, 2019 and December 31, 2018, due to their short-term nature.

Derivative Financial Instrument

Derivative Financial Instruments	9 Months Ended
	Sep. 30, 2019
Derivative Financial Instruments
Derivative Financial Instruments	NOTE 5. DERIVATIVE FINANCIAL INSTRUMENTS Foreign Currency Exchange Rate Exposure The Company uses forward foreign currency exchange contracts to secure a foreign currency exchange rate when a contract is executed involving payment in a foreign currency in order to minimize cash flow exposure to fluctuating exchange rates. Such exposure results from portions of the Company’s forecasted cash outflows being denominated in currencies other than the U.S. dollar, primarily the Swiss franc. The derivative instruments the Company uses to hedge this exposure are not designated as cash flow hedges, and as a result, changes in their fair value are recorded in other income (expense), net, on the Company's condensed consolidated statements of operations and comprehensive loss. The fair values of forward foreign currency exchange contracts are estimated using current exchange rates and interest rates, and take into consideration the current creditworthiness of the counterparties. In March 2019, the Company settled its forward foreign currency exchange contract in the aggregate notional amount of Swiss francs 3.3 million. As of September 30, 2019, the Company has no open forward foreign currency exchange contracts. The net loss associated with the Company's derivative instruments of zero and $60,558 for the three and nine months ended September 30, 2019, respectively, is recognized in other income (expense), net, on the condensed consolidated statement of operations and comprehensive loss. The net loss related to such derivative instruments was $45,566 for each of the three and nine months ended September 30, 2018.

Borrowings

Borrowings	9 Months Ended
	Sep. 30, 2019
Borrowings
Borrowings	NOTE 6. BORROWINGS Solar Capital and Western Alliance Bank Loan Agreement On May 16, 2018, Borrowings under the Term Loan bear interest at a floating per annum rate equal to 7.45% plus the one-month LIBOR. The Company is permitted to make interest-only payments on the Term Loan through December 1, 2020 if the Company achieves its primary endpoint in the Phase 3 study of tenapanor for the treatment of hyperphosphatemia in CKD patients on dialysis, prior to June 1, 2020; otherwise, the Company is permitted to make interest-only payments on the Term Loan only through June 1, 2020. Accordingly, beginning on either June 1, 2020 or December 1, 2020, as applicable, through the maturity date, the Company will be required to make monthly payments of interest plus repayment of the Term Loan in consecutive equal monthly installments of principal. The Company paid a closing fee of 1% of the Term Loan, or $0.5 million, upon the closing of the Term Loan. The Company is obligated to pay a final fee equal to 3.95% of the Term Loan upon the earliest to occur of the maturity date, the acceleration of the Term Loan, the prepayment or repayment of the Term Loan or the termination of the Loan Agreement. The Company may voluntarily prepay the outstanding Term Loan, subject to a prepayment premium of (i) 3% of the principal amount of the Term Loan if prepaid prior to or on the first anniversary of the Closing Date, (ii) 2% of the principal amount of the Term Loan if prepaid after the first anniversary of the Closing Date through and including the second anniversary of the Closing Date, or (iii) 1% of the principal amount of the Term Loan if prepaid after the second anniversary of the Closing Date and prior to the maturity date. The Term Loan is secured by substantially all the Company’s assets, except for the Company’s intellectual property and certain other customary exclusions. Additionally, in connection with the Term Loan, the Company entered into an Exit Fee Agreement, whereby the Company agreed to pay an exit fee in the amount of 3% of the Term Loan, or the Exit Fee, upon any change of control transaction in respect of the Company or if the Company obtains both (i) FDA approval of tenapanor in the treatment of hyperphosphatemia in CKD patients on dialysis and (ii) FDA approval of tenapanor for the treatment of patients with IBS-C, which was obtained on September 12, 2019 when the FDA approved IBSRELA (tenapanor), a 50 mg, twice daily oral pill for the treatment of IBS-C, in adults. Notwithstanding the prepayment or termination of the Term Loan, The Loan Agreement contains customary representations and warranties and customary affirmative and negative covenants. Additionally, if the Company elects to enter into an exclusive license agreement for the use of its intellectual property in the United States (other than for tenapanor for hyperphosphatemia or for the Company’s FXR and TGR5 agonist programs) and has not obtained the written consent of the Lenders to enter into such license agreement, the Company has agreed to maintain unrestricted cash and cash equivalents of at least $50.0 million, until the Company achieves its primary endpoint in the second Phase 3 study of tenapanor for the treatment of hyperphosphatemia in end-stage renal disease patients on dialysis. As of September 30, 2019, the Company was in compliance with all of the covenants set forth in the Loan Agreement. In addition, the Loan Agreement contains customary events of default that entitle the Lender to cause the Company’s indebtedness under the Loan Agreement to become immediately due and payable, and to exercise remedies against the Company and the collateral securing the Term Loan, including its cash. Upon the occurrence and for the duration of an event of default, an additional default interest rate equal to 4.0% per annum will apply to all obligations owed under the Loan Agreement. As of September 30, 2019, to the Company’s knowledge, there were no facts or circumstances in existence giving rise to an event of default. As of September 30, 2019, assuming the principal payments start on December 1, 2020, the Company’s future debt payment obligations towards the principal and final fee, excluding interest payments and exit fee, for the respective fiscal years are as follows (in thousands): 2019 $ — 2020 2,083 2021 25,000 2022 24,892 Total principal and final fee payments 51,975 Less: Unamortized discount and debt issuance costs (827) Less: Unaccreted value of final fee (1,345) Loan payable, long term $ 49,803

Leases

Leases	9 Months Ended
	Sep. 30, 2019
Leases
Leases	NOTE 7. LEASES The Company has obtained the right of use for office space assets under two operating lease agreements. The Company has evaluated its facility leases and determined that, effective upon the adoption of Topic 842, the leases evaluated are all operating leases. The Company has performed an evaluation of its other contracts with suppliers and collaborators in accordance with Topic 842 and has determined that, except for the facility leases described below, none of the Company’s contracts contain a lease. The Company obtained the right of use of office space located in Fremont, CA under a lease agreement entered into in September 2008, which was most recently amended in April 2016. The office space consists of 72,500 square feet, that includes an additional 10,716 square feet added in September 2019, with the entire lease terminating on September 10, 2021. The Company has an option to extend the term by five years as to the entire premises, by giving written notice of its election to exercise such option at least twelve months but not more than eighteen months prior to the end of the expiration of the lease term. This option to extend the lease term by five years has not been included in the calculation since currently the exercise of the option is uncertain and therefore deemed not probable. The Company also obtained the right of use of 3,250 square feet of office space located in Waltham, MA in October 2018 that terminates on September 30, 2021. All of the Company’s leases are operating leases. Certain of the leases have both lease and non-lease components. The Company has elected to account for each separate lease component and the non-lease components associated with that lease component as a single lease component for all classes of underlying assets. As of September 30, 2019, the weighted average discount rate used for the calculations was 12.99% and the weighted average remaining lease term was 2.0 years. The following table provides additional details of the leases presented in the balance sheets (in thousands except remaining life and discount rate): September 30, 2019 Facilities Right of use assets $ 4,453 Current portion of lease liabilities 2,504 Operating lease liability, net of current portion 2,770 Total liabilities $ 5,274 Weighted-average remaining life years Weighted-average discount rate % The lease costs, which are included in operating expenses in our condensed consolidated statements of operations, were as follows (in thousands): Three Months Ended Nine Months Ended September 30, 2019 September 30, 2019 Facilities Operating lease cost $ $ 1,944 Cash paid for operating lease 1,890 The following table summarizes the Company’s undiscounted cash payment obligations for its operating lease liabilities as of September 30, 2019 (in thousands): Ending September 30, 2019 (remaining three months) $ 755 2020 3,065 2021 2,183 Thereafter — Total lease payments 6,003 Imputed interest (729) Total lease liabilities $ 5,274

Shareholders Equity

Shareholders Equity	9 Months Ended
	Sep. 30, 2019
Shareholders Equity
Shareholders Equity	NOTE 8. SHAREHOLDERS EQUITY On May 25, 2018, the Company completed an underwritten public offering of 12,500,000 shares of its common stock at a price to the public of $4.00 per share less underwriting discounts and commissions of $0.24 per share, that were purchased by Jefferies LLC, or Jefferies, and SVB Leerink (formerly known as Leerink Partners LLC), or Leerink, or collectively the Underwriters from the Company, at a price of $3.76 per share, and on June 25, 2018, the Company sold an additional 1,875,000 shares of its common stock at a price to the public of $4.00 per share less underwriting discounts and commissions of $0.24 per share, that were purchased by the Underwriters from the Company at a price of $3.76 per share, following the exercise in full of the underwriters’ option to purchase additional shares of common stock. The Company received net proceeds from the offering of $53.8 million, after deducting the underwriting discounts, commissions and offering expenses.

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Sep. 30, 2019
Stock-Based Compensation
Stock-Based Compensation	NOTE 9. STOCK-BASED COMPENSATION The following table presents stock-based compensation expense recognized for stock options, restricted stock units, or RSUs, performance-based restricted stock units, or PRSUs, and the Company’s employee stock purchase program, or ESPP, in the Company’s statements of operations (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2019 2018 2019 2018 Research and development $ 1,670 $ 880 $ 3,197 $ 2,770 General and administrative 2,209 1,068 4,527 4,206 Total $ 3,879 $ 1,948 $ 7,724 $ 6,976 At September 30, 2019, the Company had total unrecognized stock-based compensation expense, net of estimated forfeitures, of the following: At September 30, 2019 Unrecognized Compensation Expense Average Vesting Period ($ thousands) (Years) Stock options grants $ 9,677 2.6 RSU grants — — PRSU grants 1,391 0.9 ESPP 132 0.4 Option Exercises For the three and nine months ended September 30, 2019, options were exercised to purchase 4,513 and 6,964 shares, respectively, of the Company's common stock, with $13,000 and $21,000 net proceeds, respectively, to the Company in the three and nine months ended September 30, 2019. For each of the three and nine months ended September 30, 2018, zero options were exercised to purchase shares of the Company's common stock, with zero net proceeds to the Company. Restricted Stock Units In July 2018, the Company granted 903,374 PRSUs to its employees that vest upon the achievement of certain performance conditions, subject to the employees’ continued service relationship with the Company through the achievement date. At September 30, 2019, 850,309 of these PRSUs were outstanding. Based on the evaluation of the performance conditions at September 30, 2019, the Company concluded that the PRSU assumptions are probable and recorded a one-time catch-up of stock-based compensation expense of $2.1 million for each of the three and nine months ended September 30, 2019. Stock-based compensation expense recorded related to these PRSUs were zero for the three and nine months ended September 30, 2018. The related compensation cost was recognized as an expense over the estimated vesting period ratably when achievement of the milestone was considered probable. The expense recognized for these awards is based on the grant date fair value of the Company’s common stock multiplied by the number of units granted. For the three and nine months ended September 30, 2019, the Company issued zero and 85,609 shares of its common stock upon vesting of the time-based RSUs to its employees. No PRSUs were issued for the three and nine months ended September 30, 2019. For each of the three and nine months ended September 30, 2018, the Company issued zero shares of its common stock upon vesting of RSUs or PRSUs to its employees. Employee Stock Purchase Plan In August 2019, the Company sold 77,698 shares of its common stock under the ESPP. The shares were purchased by employees at a purchase price of $2.58 per share with proceeds to the Company of approximately $0.2 million. In February 2019, the Company sold 83,046 shares of its common stock under the ESPP. The shares were purchased by employees at a purchase price of $2.39 per share with proceeds to the Company of approximately $0.2 million. In August 2018, the Company sold 52,370 shares of its common stock under the ESPP. The shares were purchased by employees at a purchase price of $3.66 per share with proceeds to the Company of approximately $0.2 million. In February 2018, the Company sold 68,589 shares of its common stock under the ESPP. The shares were purchased by employees at a purchase price of $4.38 per share with proceeds to the Company of approximately $0.3 million. Issuance of Common Stock for Services For the three and nine months ended September 30, 2019, the Company issued zero and 113,136 shares of its common stock to members of the board of directors who elected to receive stock in lieu of their cash fees under the Company’s Amended and Restated Non-Employee Director Compensation Program. The shares issued were valued at $0.3 million based on the fair value of the common stock on the date of grant. For the three and nine months ended September 30, 2018, the Company issued zero and 75,183 shares of its common stock to members of the board of directors who elected to receive stock in lieu of their cash fees under the Company’s Amended and Restated Non-Employee Director Compensation Program. The shares issued were valued at $0.3 million based on the fair value of the common stock on the date of grant.

Net Loss Per Share

Net Loss Per Share	9 Months Ended
	Sep. 30, 2019
Net Loss Per Share
Net Loss Per Share	NOTE 10. NET LOSS PER SHARE Basic net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period, less shares subject to repurchase, and excludes any dilutive effects of stock-based awards and warrants. Diluted net loss per common share is computed giving effect to all potential dilutive common shares, including common stock issuable upon exercise of stock options, and unvested restricted common stock and stock units. As the Company had net losses for the three and nine months ended September 30, 2019 and 2018, all potential common shares were determined to be anti-dilutive. The following table sets forth the computation of net loss per common share (in thousands, except share and per share amounts): Three Months Ended Nine Months Ended September 30, September 30, 2019 2018 2019 2018 Numerator: Net loss $ (23,539) $ (24,126) $ (75,150) $ (63,436) Denominator: Weighted average common shares outstanding - basic and diluted 62,828,513 62,071,397 62,676,591 54,204,907 Net loss per share - basic and diluted $ (0.37) $ (0.39) $ (1.20) $ (1.17) For the three and nine months ended September 30, 2019, the total number of securities that could potentially dilute basic net loss per share in the future that were not included in the computation of diluted net loss per share because the effect would have been antidilutive was 10.5 million and 10.2 million, respectively. For the three and nine months ended September 30, 2018, the total number of securities that could potentially dilute basic net loss per share in the future that were not included in the computation of diluted net loss per share because the effect would have been antidilutive was 8.3 million and 8.1 million, respectively.

Accrued and Other Liabilities

Accrued and Other Liabilities	9 Months Ended
	Sep. 30, 2019
Accrued and Other Liabilities
Accrued and Other Liabilities	NOTE 11. ACCRUED AND OTHER LIABILITIES Accrued liabilities and other liabilities consist of the following (in thousands): September 30, December 31, 2019 2018 Accrued clinical and non-clinical expenses $ 6,504 $ 9,790 Accrued contract manufacturing expenses 1,627 1,971 Derivative liability for exit fee 779 533 Accrued professional and consulting services 602 112 Foreign currency derivative contract — 52 Other 170 399 $ 9,682 $ 12,857

Collaboration and Licensing Agr

Collaboration and Licensing Agreements	9 Months Ended
	Sep. 30, 2019
Collaboration and Licensing Agreements
Collaboration and Licensing Agreements	NOTE 12. COLLABORATION AND LICENSING AGREEMENTS Kyowa Kirin Co., Ltd., or KKC (formerly known as Kyowa Hakko Kirin Co., Ltd, or KHK) In November 2017, the Company entered into an exclusive license agreement with KKC, or the KKC Agreement, for the development, commercialization and distribution of tenapanor in Japan for cardiorenal indications. The Company assessed these arrangements in accordance with Topic 606 and concluded that the contract counterparty, KKC, is a customer. Under the terms of the KKC Agreement, the Company received $30.0 million in up-front license fees which was recognized as revenue when the agreement was executed. Based on the Company’s assessment, it identified that the license and the manufacturing supply services were its material performance obligations at the inception of the agreement, and as such each of the performance obligations are distinct. Additionally, on January 1, 2018, the Company recorded unbilled license revenue under current assets of $5.0 million and uncharged license fees under current liabilities of $1.0 million related to the first milestone under the KKC Agreement that KKC achieved in February 2019, reflecting revenues and cost of revenue, respectively, that would have been recognized in the fourth quarter 2017 if the Company had adopted Topic 606 prior to January 1, 2018. On KKC’s achievement of the milestone in February 2019, the balance related to unbilled license revenue was adjusted to zero. Correspondingly, the $1.0 million balance related to uncharged license fees that the Company owed to AstraZeneca was reclassified to accounts payable during the three months ended March 31, 2019, and subsequently paid to AstraZeneca during the three months ended June 30, 2019. In addition to the up-front license fee received of $30.0 million, the Company may be entitled to receive up to $55.0 million in total development milestones, of which $5.0 million has been received to date, and 8.5 billion yen in commercialization milestones, worth up to $78.5 million at the currency exchange rate on September 30, 2019, as well as reimbursement of cost, plus a reasonable overhead for the supply of product and high-teen royalties on net sales throughout the term of the agreement. The variable consideration related to the remaining development milestone payments has not been included in the transaction price as these were fully constrained at September 30, 2019. For the three and nine months ended September 30, 2019, $13,000 and $31,000 of other revenue was recorded, and for each of the three and nine months ended September 30, 2018, $0.2 million of other revenue was recorded. For both periods the other revenue recorded was for manufacturing supply of tenapanor and other materials delivered to KKC for its product development and clinical trials in Japan, in accordance with the Company’s agreement with KKC. Shanghai Fosun Pharmaceutical Industrial Development Co. Ltd., or Fosun Pharma In December 2017, the Company entered into an exclusive license agreement with Fosun Pharma, or the Fosun Agreement, for the development, commercialization and distribution of tenapanor in China for both hyperphosphatemia and irritable bowel syndrome with constipation, or IBS-C. The Company assessed these arrangements in accordance with Topic 606 and concluded that the contract counterparty, Fosun Pharma, is a customer. Under the terms of the Fosun Agreement, the Company received $12.0 million in up-front license fees which was recognized as revenue when the agreement was executed. Based on the Company’s assessment, it identified that the license and the manufacturing supply services were its material performance obligations at the inception of the agreement, and as such each of the performance obligations are distinct. In addition, the Company may be entitled to additional development and commercialization milestones of up to $110.0 million, as well as reimbursement of cost plus a reasonable overhead for the supply of product and tiered royalties on net sales ranging from the mid-teens to 20%. The variable consideration related to the remaining development milestone payments has not been included in the transaction price as these were fully constrained at September 30, 2019. For each of the three and nine months ended September 30, 2019, $3.0 million revenue was recorded related to the Fosun Agreement upon the achievement of a development milestone pursuant to the agreement. In October 2019, the Company received corresponding payment of $2.7 million, net of $0.3 million withholding tax. For each of the three and nine months ended September 30, 2018, no revenue was recorded related to the Fosun Agreement. Knight Therapeutics, Inc., or Knight In March 2018, the Company entered into an exclusive license agreement with Knight Therapeutics, Inc., or the Knight Agreement, for the development, commercialization and distribution of tenapanor in Canada for hyperphosphatemia and IBS-C. The Company assessed these arrangements in accordance with Topic 606 and concluded that the contract counterparty, Knight, is a customer. Based on the Company’s assessment, it identified that the license and the manufacturing supply services were its material performance obligations at the inception of the agreement, and as such each of the performance obligations are distinct. Under the terms of the agreement, the Company is eligible to receive up to CAD 25 million in total payments, worth up to $18.9 million at the currency exchange rate on September 30, 2019, including an up-front payment and development and sales milestones, reimbursement of supply costs on a schedule specifying cost per tablet, with a reasonable mark up for overhead, as well as tiered royalty rates on net sales ranging from the mid-single digits to the low twenties. The variable consideration related to the remaining development milestone payments has not been included in the transaction price as these were fully constrained at September 30, 2019. For each of the three and nine months ended September 30, 2019, no revenue was recorded related to the Knight Agreement. For the three and nine months ended September 30, 2018, zero and $2.3 million of revenue, respectively, was recorded related to the Knight Agreement, and zero and $0.5 million of cost of revenue, respectively, was recorded pursuant to the AstraZeneca Termination Agreement. AstraZeneca In June 2015, the Company entered into a termination agreement with AstraZeneca, or the AstraZeneca Termination Agreement, pursuant to which the Company remains liable to pay AstraZeneca fees for (i) future royalties at a royalty rate of 10% of net sales of tenapanor or other NHE3 products by the Company or its licensees, and (ii) 20% of non-royalty revenue received from a new collaboration partner should the Company elect to license, or otherwise provide rights to develop and commercialize tenapanor or another NHE3 inhibitor, up to a maximum of $75.0 million in aggregate for (i) and (ii). To date in aggregate, the Company has recognized $10.5 million of the $75.0 million, recorded as cost of revenue, as follows: Cost of Revenue Recognized Amount Paid (in million) Year 2017 $ 8.4 $ 6.0 Year 2018 0.5 2.9 Year 2019 First Quarter 1.0 — Second Quarter — 1.0 Third Quarter 0.6 — Total $ 10.5 $ 9.9 Maximum payment per termination agreement 75.0 Remaining balance $ 65.1

Contingencies

Contingencies	9 Months Ended
	Sep. 30, 2019
Contingencies.
Contingencies	NOTE 13. CONTINGENCIES From time to time the Company may be involved in claims arising in connection with its business. Based on information currently available, the Company believes that the amount, or range, of reasonably possible losses in connection with any pending actions against it in excess of established reserves, in the aggregate, not to be material to its consolidated financial condition or cash flows. However, losses may be material to the Company’s operating results for any particular future period, depending on the level of income or loss for such period.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2019
Summary of Significant Accounting Policies
Use of Estimates	Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and judgments that affect the amounts reported in the consolidated financial statements and accompanying notes. On an ongoing basis, management evaluates its estimates, including those related to recognition of revenue, clinical trial accruals, contract manufacturing accruals, fair value of assets and liabilities, income taxes and stock-based compensation. Management bases its estimates on historical experience and on various other market-specific and relevant assumptions that management believes to be reasonable under the circumstances. Actual results could materially differ from those estimates.
Accrued Research and Development Expenses	Accrued Research and Development Expenses As part of the process of preparing its financial statements, the Company is required to estimate its accrued expenses. This process involves reviewing open contracts and purchase orders, communicating with its personnel to identify services that have been performed on its behalf and estimating the level of service performed and the associated cost incurred for the service when the Company has not yet been invoiced or otherwise notified of the actual cost. The majority of the Company’s service providers submit its monthly invoices in arrears for services performed or when contractual milestones are met. The Company makes estimates of its accrued expenses as of each balance sheet date in its financial statements based on facts and circumstances known to the Company at that time. The Company periodically confirms the accuracy of its estimates with the service providers and makes adjustments if necessary. Examples of estimated accrued research and development expenses include fees paid to: · contract research organizations, or CROs, in connection with clinical studies; · investigative sites in connection with clinical studies; · vendors related to product manufacturing, development and distribution of clinical supplies; and · vendors in connection with preclinical development activities. The Company records expenses related to clinical studies and manufacturing development activities based on its estimates of the services received and efforts expended pursuant to contracts with multiple CROs and manufacturing vendors that conduct and manage these activities on its behalf. The financial terms of these agreements are subject to negotiation, vary from contract to contract, and may result in uneven payment flows. There may be instances in which payments made to the Company’s vendors will exceed the level of services provided and result in a prepayment of the expense. Payments under some of these contracts depend on factors such as the successful enrollment of subjects and the completion of clinical trial milestones. In accruing service fees, the Company estimates the time period over which services will be performed, enrollment of subjects, number of sites activated and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the Company’s estimate, the Company will adjust the accrued or prepaid expense balance accordingly. To date, there have been no material differences from the Company’s estimates to the amounts actually incurred.
Revenue Recognition	Revenue Recognition On January 1, 2018 the Company adopted the new standard for Revenue from Contracts with Customers, ASC 606, on a modified retrospective method as an adjustment to the opening balance of retained earnings of the annual reporting period. As a result of the adoption of the new standard, on January 1, 2018, the Company had recorded the following: (i) unbilled license revenue under current assets of $5.0 million representing a future receivable related to the first milestone under the Company’s license agreement with Kyowa Kirin Co., Ltd., or KKC (formerly known as Kyowa Hakko Kirin Co., Ltd, or KHK), which was subsequently achieved by KKC and collected in February 2019, thereby reducing the unbilled license revenue balance to zero, (ii) uncharged license fees under current liabilities of $1.0 million representing the corresponding future payable related to AstraZeneca AB, or AstraZeneca, in accordance with the Company’s termination agreement with AstraZeneca, which, upon KKC achieving the milestone, was reclassified to accounts payable and subsequently paid to AstraZeneca during the three months ended June 30, 2019, and (iii) a related decrease in accumulated deficit of approximately $4.0 million as the new standard permitted revenue from milestones that possess certain criteria to be recognized earlier and also contained different recognition criteria related to milestones than under the previous standard, Revenue Recognition, Multiple-Element Arrangements - Licensing revenues , ASC 605. The Company enters into license agreements which are within the scope of ASC 606, under which it licenses certain rights to its product candidates to third parties. The terms of these arrangements typically include payment to the Company of one or more of the following: non-refundable, up-front license fees; development, regulatory and commercial milestone payments; and future royalties on net sales of licensed products. Each of these payments results in license, collaboration and other revenues, except for revenues from royalties on net sales of licensed products, which are classified as royalty revenues. In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. As part of the accounting for these arrangements, the Company must develop assumptions that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. The Company uses key assumptions to determine the stand-alone selling price, which may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success. Milestone Payments: At the inception of each arrangement that includes development milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. Amounts of variable consideration are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur and when the uncertainty associated with the variable consideration is subsequently resolved. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The transaction price is then allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development milestones and any related constraint, and if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect license, collaboration and other revenues and earnings in the period of adjustment. At each reporting period, the variable consideration related to the remaining development milestone payments is not included in the transaction price as these are fully constrained as of that period end date. As part of its evaluation of the constraint, the Company considers numerous factors, including that receipt of the milestones is outside the control of the Company and contingent upon success in future clinical trials and collaboration partner’s efforts. Any variable consideration related to sales-based milestones (including royalties) will be recognized when the related sales occur as they were determined to relate predominantly to the license granted to the collaboration partner. The Company re-evaluates the transaction price in each reporting period and as uncertain events are resolved or other changes in circumstances occur. Manufacturing Supply Services: Arrangements that include a promise for future supply of drug substance or drug product for either clinical development or commercial supply at the customer’s discretion are generally considered as options. The Company assess if these options provide a material right to the licensee and if so, they are accounted for as separate performance obligations. If the Company is entitled to additional payments when the customer exercises these options, any payments are recorded in other revenues when the customer obtains control of the goods, which is upon delivery. Royalties: For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes 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). To date, the Company has not recognized any royalty revenue resulting from any of its licensing arrangements.
Derivatives and Hedging Activities	Derivatives and Hedging Activities The Company accounts for its derivative instruments as either assets or liabilities on the condensed balance sheet and measures them at fair value. Derivatives are adjusted to fair value through other income (expense), net in the condensed consolidated statements of operations and comprehensive loss.
Leases	Leases We determine if an arrangement is a lease at the inception of the arrangement. Operating leases are included in right-of-use assets, current portion of operating lease liability, and operating lease liability, net of current portion in our condensed balance sheets. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments, we use our incremental borrowing rate based on the information available at the lease commencement date. The operating lease right-of-use assets also include any lease payments made and exclude lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise any such options. Lease expense is recognized on a straight-line basis over the expected lease term. On January 1, 2019, we adopted ASU No. 2016-02, Leases ( Topic 842) using the optional transition method to initially account for the impact of the adoption with a cumulative adjustment to accrued and other liabilities and other long-term liabilities. We elected the package of practical expedients, which among other things, allowed us not to reassess the following: whether any expired or existing contracts were considered or contained leases; the lease classification for any expired or existing leases; or initial direct costs for any existing leases. For our building leases, we also elected the practical expedient not to separate lease and non-lease components, such as common area maintenance charges, and instead we account for these as a single lease component.
Recent Accounting Pronouncements	Recent Accounting Pronouncements New Accounting Pronouncements - Recently Adopted On January 1, 2019, the Company adopted ASU 2018-07, Compensation – Stock Compensation (Topic 718). This update simplifies the accounting for share-based payments to non-employees by aligning it with the accounting guidance for share-based payments for employees. The ASU expands the scope of Topic 718, Compensation – Stock Compensation, which currently only includes share-based payments issued to employees, to also include share-based payments issued to non-employees for goods and services. Consequently, the accounting for share-based payments to non-employees and employees is substantially aligned. The adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements. In August 2018, the SEC adopted amendments to certain disclosure requirements in Securities Act Release No. 33-10532, Disclosure Update and Simplification. These amendments eliminate, modify, or integrate into other SEC requirements certain disclosure rules. Among the amendments is the requirement to present an analysis of changes in stockholders’ equity in the interim financial statements included in quarterly reports on Form 10-Q. The analysis, which can be presented as a footnote or separate statement, is required for the current and comparative quarter and year-to-date interim periods. The amendments are effective for all filings made on or after November 5, 2018. In light of the anticipated timing of effectiveness of the amendments and expected proximity of effectiveness to the filing date for most filers’ quarterly reports, the SEC’s Division of Corporate Finance issued a Compliance and Disclosure Interpretation related to Exchange Act Forms, or CDI – Question 105.09, that provides transition guidance related to this disclosure requirement. CDI – Question 105.09 states that the SEC would not object if the filer’s first presentation of the changes in shareholders’ equity is included in its Form 10-Q for the quarter that begins after the effective date of the amendments. As such, the Company adopted these SEC amendments on November 5, 2018 and started presenting the analysis of changes in stockholders’ equity starting in its Quarterly Report on Form 10-Q for the period ended March 31, 2019. The adoption of these SEC amendments did not have a material effect on the Company’s financial position, results of operations, cash flows or shareholders’ equity. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (ASU 2016-02), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements, or ASU No. 2018-11. In issuing ASU No. 2018-11, the FASB is permitting another transition method for ASU 2016-02, which allows the transition to the new lease standard by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. We elected the transition method and package of practical expedients permitted under the transition guidance, which allowed us to carryforward our historical lease classification, our assessment on whether a contract is or contains a lease, and our initial direct costs for any leases that exist prior to adoption of the new standard. We also elected to combine lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the statements of operations on a straight-line basis over the lease term. We adopted the ASU on January 1, 2019 using a modified retrospective approach and recorded a right-of-use asset and a corresponding lease liability to account for our facility lease as a cumulative-effect adjustment to the opening balance of accrued and other liabilities and other long-term liabilities in the period of adoption. Impact of Adoption The Company, on adopting ASU 2016-02 - Leases (Topic 842) on January 1, 2019, has used the modified retrospective approach with the cumulative effect of initially applying the standard as an adjustment to the opening balance of accrued and other liabilities and other long-term liabilities. The following adjustments were recorded in the opening balance on January 1, 2019 (in thousands): December 31, Adjustments January 1, 2018 Due to Topic 842 2019 Right-of-use assets $ — 5,810 $ 5,810 Current portion of operating lease liability — 1,892 1,892 Operating lease liability, net of current portion — 4,684 4,684 Accrued and other liabilities 12,857 (184) 12,673 Other long-term liabilities $ 582 (582) $ — As a result of adopting Topic 842 on January 1, 2019, the following financial statement line items in the Company’s condensed balance sheet at September 30, 2019 and the condensed consolidated statement of operations and comprehensive loss for the nine months ended September 30, 2019 were affected (in thousands): September 30, 2019 As Reported under Topic 842 Under Topic 840 Effect of Change Right-of-use assets $ 4,453 — $ 4,453 Current portion of operating lease liability 2,504 — 2,504 Operating lease liability, net of current portion 2,770 — 2,770 Accrued and other liabilities 9,682 9,989 (307) Other long-term liabilities $ — 349 $ (349) Nine Months Ended September 30, 2019 As Reported under Topic 842 Under Topic 840 Effect of Change Operating expenses: General and administrative related to leases $ 1,944 1,779 $ 165 In June 2018, the FASB issued ASU No. 2018-07, Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting . ASU 2018-07 is intended to reduce the cost and complexity and to improve financial reporting for nonemployee share-based payments. ASU 2018-07 expands the scope of Topic 718, Compensation-Stock Compensation (which currently only includes share-based payments to employees) to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. ASU 2018-07 supersedes Subtopic 505-50, Equity-Based Payments to Non-Employees. ASU 2018-07 is effective for the Company for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year and early adoption is permitted. On January 1, 2019, we adopted ASU 2018-07 and the adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements. New Accounting Pronouncements Not Yet Adopted In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 . The guidance clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue under Topic 606 when the collaborative arrangement participant is a customer. For the Company, the amendment will be effective January 1, 2020. The Company is evaluating the impact this guidance will have on its consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU No. 2018-15 Intangibles (Topic 350): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract , which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This new standard also requires customers to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. This ASU is effective for public companies for fiscal years beginning after December 15, 2019. This new standard can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is currently evaluating the impact of adoption of this ASU on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement . ASU 2018-13 considers cost and benefits, and removes, modifies and adds disclosure requirements in Topic 820. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty is to be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments are to be applied retrospectively to all periods presented. ASU 2018-13 is effective for the Company for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year and early adoption is permitted. The Company is currently assessing the impact of this standard on its consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , an amendment which modifies the measurement and recognition of credit losses for most financial assets and certain other instruments. The amendment updates the guidance for measuring and recording credit losses on financial assets measured at amortized cost by replacing the “incurred loss” model with an “expected loss” model. Accordingly, these financial assets will be presented at the net amount expected to be collected. The amendment also requires that credit losses related to available-for-sale debt securities be recorded as an allowance through net income rather than reducing the carrying amount under the current, other-than-temporary-impairment model. The guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for annual periods after December 15, 2018. The Company is currently evaluating the impact of adoption of this ASU on its condensed consolidated financial statements. The Company has reviewed all other significant newly-issued accounting pronouncements and concluded that they either are not applicable to the Company’s operations or no material effect is expected on its condensed consolidated financial statements as a result of future adoption.
Fair Value Measurements	Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The three-level hierarchy for the inputs to valuation techniques is briefly summarized as follows: Level 1 – Valuations are based on quoted prices in active markets for identical assets or liabilities and readily accessible by the Company at the reporting date. Examples of assets and liabilities utilizing Level 1 inputs are certain money market funds, U.S. Treasuries and trading securities with quoted prices on active markets. Level 2 – Valuations based on 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. Examples of assets and liabilities utilizing Level 2 inputs are corporate bonds, commercial paper, certificates of deposit and over-the-counter derivatives. Level 3 – Valuations based on unobservable inputs in which there is little or no market data, which require the Company to develop its own assumptions.

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2019
ASU 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Schedule of adjustments of topic 842	The following adjustments were recorded in the opening balance on January 1, 2019 (in thousands): December 31, Adjustments January 1, 2018 Due to Topic 842 2019 Right-of-use assets $ — 5,810 $ 5,810 Current portion of operating lease liability — 1,892 1,892 Operating lease liability, net of current portion — 4,684 4,684 Accrued and other liabilities 12,857 (184) 12,673 Other long-term liabilities $ 582 (582) $ — As a result of adopting Topic 842 on January 1, 2019, the following financial statement line items in the Company’s condensed balance sheet at September 30, 2019 and the condensed consolidated statement of operations and comprehensive loss for the nine months ended September 30, 2019 were affected (in thousands): September 30, 2019 As Reported under Topic 842 Under Topic 840 Effect of Change Right-of-use assets $ 4,453 — $ 4,453 Current portion of operating lease liability 2,504 — 2,504 Operating lease liability, net of current portion 2,770 — 2,770 Accrued and other liabilities 9,682 9,989 (307) Other long-term liabilities $ — 349 $ (349) Nine Months Ended September 30, 2019 As Reported under Topic 842 Under Topic 840 Effect of Change Operating expenses: General and administrative related to leases $ 1,944 1,779 $ 165

Cash, Cash Equivalents and In_2

Cash, Cash Equivalents and Investments (Tables)	9 Months Ended
	Sep. 30, 2019
Cash, Cash Equivalents and Investments
Schedule of Securities Classified as Cash, Cash Equivalents and Short-Term Investments	Securities classified as cash, cash equivalents and short-term investments as of September 30, 2019 and December 31, 2018, are summarized below (in thousands). Estimated fair value is based on quoted market prices for these investments. September 30, 2019 Gross Unrealized Amortized Cost Gains Losses Fair Value Cash and cash equivalents: Cash $ 3,595 — — $ 3,595 Money market funds 89,078 — — 89,078 Total cash and cash equivalents $ 92,673 $ — $ — $ 92,673 Short-term investments Corporate bonds 3,324 1 — 3,325 Commercial paper 6,234 2 — 6,236 Asset-backed securities 1,308 1 — 1,309 Total short-term investments $ 10,866 $ 4 $ — $ 10,870 Total cash equivalents and investments $ 103,539 $ 4 $ — $ 103,543 December 31, 2018 Gross Unrealized Amortized Cost Gains Losses Fair Value Cash and cash equivalents: Cash $ 3,733 $ — $ — $ 3,733 Money market funds 73,238 — — 73,238 Commercial paper 1,797 — — 1,797 Total cash equivalents and investments $ 78,768 $ — $ — $ 78,768 Short-term investments U.S. treasury securities $ 3,996 — — $ 3,996 Corporate bonds 34,611 — (21) 34,590 Commercial paper 41,371 — (14) 41,357 Asset-backed securities 9,381 — (3) 9,378 Total short-term investments $ 89,359 $ — $ (38) $ 89,321 Total cash equivalents and investments $ 168,127 $ — $ (38) $ 168,089

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	9 Months Ended
	Sep. 30, 2019
Fair Value Measurements
Summary of Fair Value Measurements of Company's Financial Assets and Liabilities	The following table sets forth the fair value of the Company’s financial assets and liabilities measured on a recurring basis by level within the fair value hierarchy (in thousands): September 30, 2019 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 89,078 $ 89,078 $ — $ — Corporate bonds 3,325 — 3,325 — Commercial paper 6,236 — 6,236 — Asset-backed securities 1,309 — 1,309 — Total $ 99,948 $ 89,078 $ 10,870 $ — Liabilities: Derivative liability for exit fee $ 779 $ — $ — $ 779 Total $ 779 $ — $ — $ 779 December 31, 2018 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 73,238 $ 73,238 $ — $ — U.S. treasury securities 3,996 3,996 — — Corporate bonds 34,590 — 34,590 — Commercial paper 43,154 — 43,154 — Asset-backed securities 9,378 — 9,378 — Total $ 164,356 $ 77,234 $ 87,122 $ — Liabilities: Derivative liability for exit fee $ 533 $ — $ — $ 533 Foreign currency derivative contracts 52 $ — $ 52 $ — Total $ 585 $ — $ 52 $ 533
Summary of Changes in the Fair Value of Recurring Measurements	Changes in the fair value of recurring measurements included in Level 3 of the fair value hierarchy are presented as other income (expense), net, in the Company's condensed consolidated statements of operations and were as follows for the three and nine months ended September 30, 2019 (in thousands): Estimated Fair Value of Derivative Liability Balance of Level 3 Liabilities at December 31, 2018 $ 533 Change in estimated fair value of derivative liability for exit fee 246 Balance of Level 3 Liabilities at September 30, 2019 $ 779

Borrowings (Tables)

Borrowings (Tables)	9 Months Ended
	Sep. 30, 2019
Borrowings
Schedule of Future Debt Payment Obligations	As of September 30, 2019, assuming the principal payments start on December 1, 2020, the Company’s future debt payment obligations towards the principal and final fee, excluding interest payments and exit fee, for the respective fiscal years are as follows (in thousands): 2019 $ — 2020 2,083 2021 25,000 2022 24,892 Total principal and final fee payments 51,975 Less: Unamortized discount and debt issuance costs (827) Less: Unaccreted value of final fee (1,345) Loan payable, long term $ 49,803

Leases (Tables)

Leases (Tables)	9 Months Ended
	Sep. 30, 2019
Leases
Summary of Additional Details of the Leases	The following table provides additional details of the leases presented in the balance sheets (in thousands except remaining life and discount rate): September 30, 2019 Facilities Right of use assets $ 4,453 Current portion of lease liabilities 2,504 Operating lease liability, net of current portion 2,770 Total liabilities $ 5,274 Weighted-average remaining life years Weighted-average discount rate %
Summary of Lease Costs	The lease costs, which are included in operating expenses in our condensed consolidated statements of operations, were as follows (in thousands): Three Months Ended Nine Months Ended September 30, 2019 September 30, 2019 Facilities Operating lease cost $ $ 1,944 Cash paid for operating lease 1,890
Summary of Undiscounted Cash Payment Obligations for its Operating Lease Liabilities	The following table summarizes the Company’s undiscounted cash payment obligations for its operating lease liabilities as of September 30, 2019 (in thousands): Ending September 30, 2019 (remaining three months) $ 755 2020 3,065 2021 2,183 Thereafter — Total lease payments 6,003 Imputed interest (729) Total lease liabilities $ 5,274

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2019
Stock-Based Compensation
Summary of Stock-Based Compensation Expense Recognized	The following table presents stock-based compensation expense recognized for stock options, restricted stock units, or RSUs, performance-based restricted stock units, or PRSUs, and the Company’s employee stock purchase program, or ESPP, in the Company’s statements of operations (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2019 2018 2019 2018 Research and development $ 1,670 $ 880 $ 3,197 $ 2,770 General and administrative 2,209 1,068 4,527 4,206 Total $ 3,879 $ 1,948 $ 7,724 $ 6,976
Summary of Total Unrecognized Stock-Based Compensation Expense, Net of Estimated Forfeitures	At September 30, 2019 Unrecognized Compensation Expense Average Vesting Period ($ thousands) (Years) Stock options grants $ 9,677 2.6 RSU grants — — PRSU grants 1,391 0.9 ESPP 132 0.4

Net Loss Per Share (Tables)

Net Loss Per Share (Tables)	9 Months Ended
	Sep. 30, 2019
Net Loss Per Share
Computation of Basic and Diluted Loss Per Share Attributable to Common Stockholders	As the Company had net losses for the three and nine months ended September 30, 2019 and 2018, all potential common shares were determined to be anti-dilutive. The following table sets forth the computation of net loss per common share (in thousands, except share and per share amounts): Three Months Ended Nine Months Ended September 30, September 30, 2019 2018 2019 2018 Numerator: Net loss $ (23,539) $ (24,126) $ (75,150) $ (63,436) Denominator: Weighted average common shares outstanding - basic and diluted 62,828,513 62,071,397 62,676,591 54,204,907 Net loss per share - basic and diluted $ (0.37) $ (0.39) $ (1.20) $ (1.17)

Accrued and Other Liabilities (

Accrued and Other Liabilities (Tables)	9 Months Ended
	Sep. 30, 2019
Accrued and Other Liabilities
Schedule of Accrued Liabilities and Other Liabilities	Accrued liabilities and other liabilities consist of the following (in thousands): September 30, December 31, 2019 2018 Accrued clinical and non-clinical expenses $ 6,504 $ 9,790 Accrued contract manufacturing expenses 1,627 1,971 Derivative liability for exit fee 779 533 Accrued professional and consulting services 602 112 Foreign currency derivative contract — 52 Other 170 399 $ 9,682 $ 12,857

Collaboration And Licensing A_2

Collaboration And Licensing Agreements (Tables)	9 Months Ended
	Sep. 30, 2019
Collaboration and Licensing Agreements
Schedule of Cost of Revenue Recognized and Paid	Cost of Revenue Recognized Amount Paid (in million) Year 2017 $ 8.4 $ 6.0 Year 2018 0.5 2.9 Year 2019 First Quarter 1.0 — Second Quarter — 1.0 Third Quarter 0.6 — Total $ 10.5 $ 9.9 Maximum payment per termination agreement 75.0 Remaining balance $ 65.1

Organization and Basis of Pre_2

Organization and Basis of Presentation - Additional Information (Details)	9 Months Ended
	Sep. 30, 2019segment
Organization and Basis of Presentation
Number of operating segments	1

Organization and Basis of Pre_3

Organization and Basis of Presentation - Prior Period Errors (Details) - USD ($) $ in Thousands	3 Months Ended							9 Months Ended
	Sep. 30, 2019	Mar. 31, 2019	Dec. 31, 2018		Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Sep. 30, 2019	Sep. 30, 2018
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Research and Development Expense	$ 17,580				$ 17,941			$ 57,436	$ 47,337
Accrued Liabilities and Other Liabilities	9,682		$ 12,857	[1]				9,682
Effect of Change
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accrued Liabilities and Other Liabilities	$ (307)							$ (307)
Overstatement due to clinical trial accrual errors | Effect of Change
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Research and Development Expense		$ 500	1,400		$ 1,100	$ 900	$ 200
Accrued Liabilities and Other Liabilities			$ 3,600
[1]	Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10K for the year ended December 31, 2018.

Organization and Basis of Pre_4

Organization and Basis of Presentation - Cumulative adjustments (Details) $ in Millions	6 Months Ended
	Jun. 30, 2019USD ($)
Reduction in accrued and other liabilities
Quantifying Misstatement in Current Year Financial Statements [Line Items]
Correction of cumulative errors	$ 4.1
Reduction in research and development expenses
Quantifying Misstatement in Current Year Financial Statements [Line Items]
Correction of cumulative errors	$ 4.1

Summary of Significant Accoun_4

Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands		Sep. 30, 2019	Dec. 31, 2018		Jan. 01, 2018
Summary of significant accounting policies
Current assets		$ 110,834	$ 176,371	[1]
Accumulated deficit		(440,662)	(365,512)	[1]
Unbilled license revenue	[1]		5,000
Current liabilities		17,679	17,728	[1]
Uncharged license fees	[1]		$ 1,000
Kyowa Hakko Kirin [Member]
Summary of significant accounting policies
Unbilled license revenue		0
ASU 2014-09 | Adjustments | Kyowa Hakko Kirin [Member]
Summary of significant accounting policies
Current assets					$ 5,000
Accumulated deficit					4,000
Unbilled license revenue		$ 0
Current liabilities					$ 1,000
[1]	Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10K for the year ended December 31, 2018.

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Impact of Adoption (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Jan. 01, 2019	Dec. 31, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Right-of-use assets	$ 4,453
Current portion of operating lease liability	2,504
Operating lease liability, net of current portion	2,770
Accrued and other liabilities	9,682		$ 12,857	[1]
ASU 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Right-of-use assets		$ 5,810
Current portion of operating lease liability		1,892
Operating lease liability, net of current portion		4,684
Accrued and other liabilities		12,673	12,857
Other long-term liabilities			$ 582
Under Topic 840
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accrued and other liabilities	9,989
Other long-term liabilities	349
Effect of Change
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Right-of-use assets	4,453
Current portion of operating lease liability	2,504
Operating lease liability, net of current portion	2,770
Accrued and other liabilities	(307)
Other long-term liabilities	$ (349)
Effect of Change | ASU 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Right-of-use assets		5,810
Current portion of operating lease liability		1,892
Operating lease liability, net of current portion		4,684
Accrued and other liabilities		(184)
Other long-term liabilities		$ (582)
[1]	Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10K for the year ended December 31, 2018.

Summary of Significant Accoun_6

Summary of Significant Accounting Policies - Operating expense (Details) - General and administrative - ASU 2016-02 $ in Thousands	9 Months Ended
	Sep. 30, 2019USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Lease expense	$ 1,944
Under Topic 840
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Lease expense	1,779
Effect of Change
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Lease expense	$ 165

Cash, Cash Equivalents and In_3

Cash, Cash Equivalents and Investments - Schedule of Securities Classified as Cash, Cash Equivalents and Short-term Investments (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018		Sep. 30, 2018	Dec. 31, 2017
Cash Cash Equivalents And Short Term Investments [Line Items]
Cash and cash equivalents, Amortized Cost	$ 92,673	$ 78,768	[1]	$ 75,015	$ 75,383
Cash and cash equivalents, Fair Value	92,673	78,768
Short-term investments, Amortized Cost	10,866	89,359
Short-term investments, Gross Unrealized Gains	4
Short-term investments, Gross Unrealized Losses		(38)
Short-term investments, Fair Value	10,870	89,321
Cash equivalents and short-term investments, Amortized Cost	103,539	168,127
Cash equivalents and short-term investments, Gross Unrealized Gains	4
Cash equivalents and short-term investments, Gross Unrealized Losses		(38)
Cash equivalents and short-term investments, Fair Value	103,543	168,089
Cash [Member]
Cash Cash Equivalents And Short Term Investments [Line Items]
Cash and cash equivalents, Amortized Cost	3,595	3,733
Cash and cash equivalents, Fair Value	3,595	3,733
Money Market Funds [Member]
Cash Cash Equivalents And Short Term Investments [Line Items]
Cash and cash equivalents, Amortized Cost	89,078	73,238
Cash and cash equivalents, Fair Value	89,078	73,238
Commercial Paper (Cash Equivalents) [Member]
Cash Cash Equivalents And Short Term Investments [Line Items]
Cash and cash equivalents, Amortized Cost		1,797
Cash and cash equivalents, Fair Value		1,797
U.S. Treasury Securities [Member]
Cash Cash Equivalents And Short Term Investments [Line Items]
Short-term investments, Amortized Cost		3,996
Short-term investments, Fair Value		3,996
Corporate Bonds (Investments) [Member]
Cash Cash Equivalents And Short Term Investments [Line Items]
Short-term investments, Amortized Cost	3,324	34,611
Short-term investments, Gross Unrealized Gains	1
Short-term investments, Gross Unrealized Losses		(21)
Short-term investments, Fair Value	3,325	34,590
Commercial Paper (Investments) [Member]
Cash Cash Equivalents And Short Term Investments [Line Items]
Short-term investments, Amortized Cost	6,234	41,371
Short-term investments, Gross Unrealized Gains	2
Short-term investments, Gross Unrealized Losses		(14)
Short-term investments, Fair Value	6,236	41,357
Asset-Backed Securities [Member]
Cash Cash Equivalents And Short Term Investments [Line Items]
Short-term investments, Amortized Cost	1,308	9,381
Short-term investments, Gross Unrealized Gains	1
Short-term investments, Gross Unrealized Losses		(3)
Short-term investments, Fair Value	$ 1,309	$ 9,378
[1]	Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10K for the year ended December 31, 2018.

Cash, Cash Equivalents and In_4

Cash, Cash Equivalents and Investments - Additional Information (Details)	9 Months Ended
	Sep. 30, 2019USD ($)
Cash Cash Equivalents And Short Term Investments [Line Items]
Investment in continuous unrealized loss position for more than one year	$ 0
Maximum [Member]
Cash Cash Equivalents And Short Term Investments [Line Items]
Available for sale securities contractual maturity period	1 year

Fair Value Measurements - Summa

Fair Value Measurements - Summary of Fair Value Measurements of Company's Financial Assets and Liabilities (Details) - Fair Value, Recurring [Member] - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Assets:
Assets at fair value	$ 99,948	$ 164,356
Liabilities:
Derivative liability	779	585
Level 1 [Member]
Assets:
Assets at fair value	89,078	77,234
Level 2 [Member]
Assets:
Assets at fair value	10,870	87,122
Liabilities:
Derivative liability		52
Level 3 [Member]
Liabilities:
Derivative liability	779	533
Derivative Liability Exit Fee [Member]
Liabilities:
Derivative liability	779	533
Derivative Liability Exit Fee [Member] | Level 3 [Member]
Liabilities:
Derivative liability	779	533
Foreign Currency Derivative Contracts [Member]
Liabilities:
Derivative liability		52
Foreign Currency Derivative Contracts [Member] | Level 2 [Member]
Liabilities:
Derivative liability		52
Money Market Funds [Member]
Assets:
Assets at fair value	89,078	73,238
Money Market Funds [Member] | Level 1 [Member]
Assets:
Assets at fair value	89,078	73,238
U.S. Treasury Securities [Member]
Assets:
Assets at fair value		3,996
U.S. Treasury Securities [Member] | Level 1 [Member]
Assets:
Assets at fair value		3,996
Corporate Bonds [Member]
Assets:
Assets at fair value	3,325	34,590
Corporate Bonds [Member] | Level 2 [Member]
Assets:
Assets at fair value	3,325	34,590
Commercial Paper [Member]
Assets:
Assets at fair value	6,236	43,154
Commercial Paper [Member] | Level 2 [Member]
Assets:
Assets at fair value	6,236	43,154
Asset-Backed Securities [Member]
Assets:
Assets at fair value	1,309	9,378
Asset-Backed Securities [Member] | Level 2 [Member]
Assets:
Assets at fair value	$ 1,309	$ 9,378

Fair Value Measurements - Addit

Fair Value Measurements - Additional Information (Details) $ in Thousands	Sep. 30, 2019USD ($)
Fair Value Measurements
Transfer of assets from Level 1 to Level 2	$ 0
Transfer of assets from Level 2 to Level 1	$ 0

Fair Value Measurements - Loan

Fair Value Measurements - Loan and Security Agreement (Details) - Solar Capital and Western Alliance Bank Loan Agreement [Member] - USD ($)	1 Months Ended	9 Months Ended
	May 31, 2018	Sep. 30, 2019	Dec. 31, 2018
Fair Value Measurements
Exit Fee	$ 1,500,000
Level 3 [Member]
Fair Value Measurements
Potential payment to Solar Capital Ltd. and Western Alliance Bank		$ 1,500,000
Percentage of increase in risk component		10.00%
Percentage decrease in risk component		10.00%
Fair value fluctuation due to increase in risk component		$ 100,000
Fair value fluctuation due to decrease in risk component		100,000
Derivative Liability Exit Fee [Member] | Accrued and other liabilities
Fair Value Measurements
Estimated fair value of Exit Fee		779,000	$ 533,000
Increase in estimated fair value of Exit Fee		$ 246,000

Fair Value Measurements - Chang

Fair Value Measurements - Changes in Fair Value of Recurring Measurements (Details) - Derivative Liability Exit Fee [Member] - Other income (expense), net $ in Thousands	9 Months Ended
	Sep. 30, 2019USD ($)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Beginning Balance	$ 533
Change in estimated fair value of derivative liability for exit fee	246
Ending Balance	$ 779

Derivative Financial Instrume_2

Derivative Financial Instruments - Additional Information (Details) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
	Mar. 31, 2019	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Derivative [Line Items]
Settlement of forward foreign currency exchange contract in the aggregate notional amount of Swiss francs				$ 246,000	$ 56,000
Gain (loss) on derivative instruments		$ 0	$ 45,566	60,558	$ 45,566
Foreign Currency Derivative Contracts [Member]
Derivative [Line Items]
Settlement of forward foreign currency exchange contract in the aggregate notional amount of Swiss francs	$ 3,300,000			$ 0

Borrowings (Details)

Borrowings (Details) - USD ($) $ in Thousands	May 16, 2018	Sep. 30, 2018	Sep. 30, 2019	Dec. 31, 2018	[1]
Term Loans
Amount of term loan facility	$ 50,000
Net proceeds from the loan	$ 49,300	$ 49,292
Percentage of premium payable on redemption of the term loan	1.00%
Amount of fee payable upon closing of the term loan	$ 500
Exit fee (as a percent)	3.00%
Expiration term of exit fee	10 years
Minimum unrestricted cash and cash equivalents to be maintained	$ 50,000
Additional default interest rate	4.00%
Future debt payment obligations
2020			$ 2,083
2021			25,000
2022			24,892
Total			51,975
Less: Unamortized discount and debt issuance costs			(827)
Less: Unaccreted value of final fee			(1,345)
Loan payable, long term			$ 49,803	$ 49,209
At Maturity
Term Loans
Final payment fee (as a percent)	3.95%
Prior to first anniversary of closing date
Term Loans
Prepayment fee (as a percent)	3.00%
After first anniversary of closing date
Term Loans
Prepayment fee (as a percent)	2.00%
After second anniversary to maturity date
Term Loans
Prepayment fee (as a percent)	1.00%
LIBOR
Term Loans
Floating interest rate	7.45%
[1]	Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10K for the year ended December 31, 2018.

Leases (Details)

Leases (Details)	9 Months Ended
	Sep. 30, 2019ft²USD ($)	Oct. 31, 2018ft²	Apr. 30, 2016ft²
Lessee, Lease, Description [Line Items]
Number of operating lease arrangements | $	2
Area of office space | ft²	10,716	3,250	72,500
Option to extend	true
Renewal term	5 years
Weighted-average discount rate	12.99%
Weighted-average remaining life	2 years
Maximum [Member]
Lessee, Lease, Description [Line Items]
Threshold period for giving notice of lease extension	18 months
Minimum [Member]
Lessee, Lease, Description [Line Items]
Threshold period for giving notice of lease extension	12 months

Leases - Balance Sheet and Stat

Leases - Balance Sheet and Statement of Operations (Details) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2019USD ($)	Sep. 30, 2019USD ($)
Additional details of the leases
Right-of-use assets	$ 4,453	$ 4,453
Current portion of lease liabilities	2,504	2,504
Operating lease liability, net of current portion	2,770	2,770
Total liabilities	$ 5,274	$ 5,274
Weighted-average remaining life	2 years	2 years
Weighted-average discount rate	12.99%	12.99%
Facilities
Operating lease cost	$ 648	$ 1,944
Cash paid for operating lease	$ 660	$ 1,890

Leases - Undiscounted Cash Paym

Leases - Undiscounted Cash Payment Obligations (Details) $ in Thousands	Sep. 30, 2019USD ($)
Undiscounted cash payment obligations for its operating lease liabilities
2019 (remaining three months)	$ 755
2020	3,065
2021	2,183
Total lease payments	6,003
Imputed interest	(729)
Total lease liabilities	$ 5,274

Shareholders Equity (Details)

Shareholders Equity (Details) - USD ($) $ / shares in Units, $ in Millions	Jun. 25, 2018	May 25, 2018	Sep. 30, 2019	Dec. 31, 2018
Subsidiary, Sale of Stock [Line Items]
Common stock issued			62,883,080	62,516,627
Common stock, par value			$ 0.0001	$ 0.0001
Net proceeds	$ 53.8
Offering
Subsidiary, Sale of Stock [Line Items]
Common stock issued		12,500,000
Public offering price		$ 4
Underwriting discounts and commissions per share		0.24
Underwriters' option
Subsidiary, Sale of Stock [Line Items]
Common stock issued	1,875,000
Public offering price	$ 4
Underwriting discounts and commissions per share	0.24
Purchase price	$ 3.76	$ 3.76

Stock-Based Compensation - Summ

Stock-Based Compensation - Summary of Stock-Based Compensation Expense Recognized (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock based compensation expenses	$ 3,879	$ 1,948	$ 7,724	$ 6,976
Research and development
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock based compensation expenses	1,670	880	3,197	2,770
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock based compensation expenses	$ 2,209	$ 1,068	$ 4,527	$ 4,206

Stock-Based Compensation - Unre

Stock-Based Compensation - Unrecognized Stock-Based Compensation (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2019USD ($)
Options to Purchase Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Compensation Expense	$ 9,677
Average Vesting Period	2 years 7 months 6 days
Performance-Based Restricted Stock Units (PRSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Compensation Expense	$ 1,391
Average Vesting Period	10 months 24 days
Employee Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Compensation Expense	$ 132
Average Vesting Period	4 months 24 days

Stock-Based Compensation - Addi

Stock-Based Compensation - Additional Information (Details) - USD ($)	1 Months Ended					3 Months Ended		9 Months Ended
	Aug. 31, 2019	Feb. 28, 2019	Aug. 31, 2018	Jul. 31, 2018	Feb. 28, 2018	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Net proceeds from stock option exercised								$ 21,000
Proceeds						$ 200,000	$ 193,000	$ 397,000	$ 492,000
Issuance of common stock for services, shares						0	0	113,136	75,183
Issuance of common stock for services, amount						$ 300,000	$ 300,000	$ 311,000	$ 304,000
Stock based compensation expenses						$ 3,879,000	$ 1,948,000	$ 7,724,000	$ 6,976,000
Options to Purchase Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options exercised						4,513	0	6,964	0
Net proceeds from stock option exercised						$ 13,000	$ 0	$ 21,000	$ 0
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares issued upon vesting of restricted stock units						0	0	85,609	0
Performance-Based Restricted Stock Units (PRSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares, Granted				903,374
Number of Shares, Outstanding						850,309		850,309
Number of shares issued upon vesting of restricted stock units						0	0	0	0
Stock based compensation expenses						$ 2,100,000	$ 0	$ 2,100,000	$ 0
Employee Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares issued under ESPP	77,698	83,046	52,370		68,589
Purchase price	$ 2.58	$ 2.39	$ 3.66		$ 4.38
Proceeds	$ 200,000	$ 200,000	$ 200,000		$ 300,000

Net Loss Per Share - Computatio

Net Loss Per Share - Computation of Basic and Diluted Loss Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Numerator:
Net loss	$ (23,539)	$ (24,126)	$ (75,150)	$ (63,436)
Denominator:
Weighted average common shares outstanding - basic and diluted	62,828,513	62,071,397	62,676,591	54,204,907
Net loss per share - basic and diluted	$ (0.37)	$ (0.39)	$ (1.20)	$ (1.17)

Net Loss Per Share - Additional

Net Loss Per Share - Additional Information (Details) - shares shares in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Net Loss Per Share
Anti-dilutive securities excluded from computation of diluted net loss per share attributable to common stockholders	10.5	8.3	10.2	8.1

Accrued and Other Liabilities -

Accrued and Other Liabilities - Schedule of Accrued Liabilities and Other Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Accrued and Other Liabilities
Accrued clinical and non-clinical expenses	$ 6,504	$ 9,790
Accrued contract manufacturing expenses	1,627	1,971
Derivative liability for exit fee	779	533
Accrued professional and consulting services	602	112
Foreign currency derivative contract		52
Other	170	399
Accrued liabilities and other liabilities	$ 9,682	$ 12,857	[1]
[1]	Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10K for the year ended December 31, 2018.

Collaboration and Licensing A_3

Collaboration and Licensing Agreements - Additional Information (Details) $ in Millions, ¥ in Billions		1 Months Ended					3 Months Ended				9 Months Ended			12 Months Ended
		Oct. 31, 2019USD ($)	Mar. 31, 2018CAD ($)	Dec. 31, 2017USD ($)	Nov. 30, 2017USD ($)	Jun. 30, 2015USD ($)	Sep. 30, 2019USD ($)	Jun. 30, 2019USD ($)	Mar. 31, 2019USD ($)	Sep. 30, 2018USD ($)	Sep. 30, 2019JPY (¥)	Sep. 30, 2019USD ($)	Sep. 30, 2018USD ($)	Dec. 31, 2018USD ($)		Dec. 31, 2017USD ($)	Jan. 01, 2018USD ($)
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Current assets							$ 110,834,000					$ 110,834,000		$ 176,371,000	[1]
Current liabilities							17,679,000					17,679,000		17,728,000	[1]
Unbilled license revenue	[1]													5,000,000
Development milestones Received		$ 2,700,000
Revenues							3,013,000			$ 172,000		3,031,000	$ 2,522,000
Cost of revenue							600,000			2,000		600,000	466,000
Withholding tax		$ 300,000
Kyowa Hakko Kirin [Member]
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Upfront payment received					$ 30,000,000							30,000,000
Unbilled license revenue							0					0
Revenues							13,000			200,000		31,000	200,000
Kyowa Hakko Kirin [Member] | Adjustments | ASU 2014-09
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Current assets																	$ 5,000,000
Current liabilities																	$ 1,000,000
Unbilled license revenue							0					0
Uncharged license fees reclassed to accounts payable									$ 1,000,000
Payment of uncharged license fee								$ 1,000,000
Kyowa Hakko Kirin [Member] | Development and Commercialization [Member]
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Development milestones												55,000,000
Development milestones Received												5,000,000
Commercialization milestones											¥ 8.5	78,500,000
Shanghai Fosun Pharmaceutical Industrial Development [Member]
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Upfront payment received				$ 12,000,000
Revenues							3,000,000			0		3,000,000	0
Future development milestones																$ 110,000,000
Threshold percentage of net sales for tiered royalties				20.00%
AstraZeneca [Member]
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Upfront payment received						$ 75,000,000
Cost of revenue						10,500,000	600,000	0	1,000,000					500,000		8,400,000
Cost of revenue, Amount Paid						9,900,000	0	$ 1,000,000	$ 0					$ 2,900,000		$ 6,000,000
Remaining balance						$ 65,100,000
AstraZeneca [Member] | Development and Commercialization [Member]
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Percentage of royalty revenue (as a percent)						10.00%
Percentage of non royalty revenue (as a percent)						20.00%
AstraZeneca [Member] | Termination Agreement [Member]
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Cost of revenue										0			500,000
Knight | Development and Commercialization [Member]
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenues							$ 0			$ 0		0	$ 2,300,000
Total payments, including an up-front payment and development and sales milestones to be received			$ 25									$ 18,900,000
[1]	Derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10K for the year ended December 31, 2018.