Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 05, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-34949 | |
Entity Registrant Name | ARBUTUS BIOPHARMA CORP | |
Amendment Flag | false | |
Entity Central Index Key | 0001447028 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Incorporation, State or Country Code | A1 | |
Entity Tax Identification Number | 98-0597776 | |
Entity Address, Address Line One | 701 Veterans Circle | |
Entity Address, City or Town | Warminster | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 18974 | |
City Area Code | 267 | |
Local Phone Number | 469-0914 | |
Title of 12(b) Security | Common Shares, without par value | |
Trading Symbol | ABUS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 84,909,258 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 96,918 | $ 31,799 |
Investments in marketable securities, current | 21,378 | 59,035 |
Accounts receivable | 1,075 | 1,204 |
Prepaid expenses and other current assets | 1,871 | 1,790 |
Total current assets | 121,242 | 93,828 |
Property and equipment, net of accumulated depreciation of $7,133 (December 31, 2019: $5,642) | 7,262 | 8,676 |
Right of use asset | 2,491 | 2,738 |
Other non-current assets | 109 | 293 |
Total assets | 131,104 | 105,535 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 6,913 | 7,235 |
Liability-classified options | 317 | 253 |
Lease liability, current | 378 | 340 |
Total current liabilities | 7,608 | 7,828 |
Liability related to sale of future royalties | 20,117 | 18,992 |
Contingent consideration | 3,301 | 2,953 |
Lease liability, non-current | 2,733 | 3,018 |
Total liabilities | 33,759 | 32,791 |
Stockholders’ equity: | ||
Preferred shares, Authorized; unlimited number without par value; Issued and outstanding: 1,164,000 (December 31, 2019: 1,164,000) | 146,285 | 137,285 |
Common shares, Authorized - unlimited number with no par value, Issued and outstanding: 84,618,575 (December 31, 2019 - 64,780,314) | 965,369 | 898,535 |
Additional paid-in capital | 59,614 | 55,246 |
Deficit | (1,025,796) | (970,093) |
Accumulated other comprehensive loss | (48,127) | (48,229) |
Total stockholders’ equity | 97,345 | 72,744 |
Total liabilities and stockholders’ equity | $ 131,104 | $ 105,535 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Accumulated of property, plant, and equipment | $ 7,133 | $ 5,642 |
Preferred stock, shares issued (in shares) | 1,164,000 | 1,164,000 |
Preferred stock, shares outstanding (in shares) | 1,164,000 | 1,164,000 |
Common shares, shares issued (in shares) | 84,618,575 | 64,780,314 |
Common shares, shares outstanding (in shares) | 84,618,575 | 64,780,314 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenue | ||||
Revenue | $ 1,523 | $ 3,061 | $ 4,528 | $ 4,393 |
Operating expenses | ||||
Research and development | 12,065 | 17,731 | 32,946 | 45,183 |
General and administrative | 4,065 | 3,249 | 11,184 | 15,850 |
Depreciation and amortization | 490 | 507 | 1,491 | 1,521 |
Change in fair value of contingent consideration | 120 | (376) | 348 | (121) |
Site consolidation | 0 | 182 | 64 | 33 |
Impairment of intangible assets | 0 | 43,836 | 0 | 43,836 |
Impairment of goodwill | 0 | 22,471 | 0 | 22,471 |
Arbitration | 0 | 6,486 | 0 | 6,486 |
Total operating expenses | 16,740 | 94,086 | 46,033 | 135,259 |
Loss from operations | (15,217) | (91,025) | (41,505) | (130,866) |
Interest income | 100 | 503 | 645 | 1,709 |
Interest expense | (1,074) | (1,100) | (3,214) | (1,114) |
Foreign exchange gain (loss) | (19) | (25) | (84) | 43 |
Equity investment loss | (2,545) | (3,512) | (2,545) | (11,497) |
Total other loss | (3,538) | (4,134) | (5,198) | (10,859) |
Loss before income taxes | (18,755) | (95,159) | (46,703) | (141,725) |
Income tax benefit | 0 | 12,656 | 0 | 12,656 |
Net loss | (18,755) | (82,503) | (46,703) | (129,069) |
Items applicable to preferred shares: | ||||
Dividend accretion of convertible preferred shares | (3,027) | (2,792) | (9,000) | (8,269) |
Net loss attributable to common shares | $ (21,782) | $ (85,295) | $ (55,703) | $ (137,338) |
Loss per share | ||||
Basic and diluted (in USD per share) | $ (0.27) | $ (1.50) | $ (0.77) | $ (2.43) |
Weighted average number of common shares | ||||
Basic and diluted (in shares) | 79,487,444 | 56,850,172 | 72,342,070 | 56,469,358 |
Unrealized gain on available-for-sale securities | $ (72) | $ 0 | $ 58 | $ 0 |
Currency translation adjustments | 44 | 27 | 44 | (47) |
Comprehensive loss | (18,783) | (82,476) | (46,601) | (129,116) |
Collaborations and licenses | ||||
Revenue | ||||
Revenue | 827 | 2,600 | 2,487 | 3,414 |
Non-cash royalty revenue | ||||
Revenue | ||||
Revenue | $ 696 | $ 461 | $ 2,041 | $ 979 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Stockholders’ Equity (Unaudited) - USD ($) | Total | Convertible Preferred Shares | Common Shares | Additional Paid-In Capital | Deficit | Accumulated Other Comprehensive Loss |
Beginning balance (in shares) at Dec. 31, 2018 | 1,164,000 | 55,518,800 | ||||
Beginning balance at Dec. 31, 2018 | $ 200,234,000 | $ 126,136,000 | $ 879,405,000 | $ 48,084,000 | $ (805,221,000) | $ (48,170,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Accretion of accumulated dividends on Preferred Shares | 0 | $ 2,715,000 | (2,715,000) | |||
Stock-based compensation | 1,665,000 | 1,665,000 | ||||
Certain fair value adjustments to liability stock option awards | 47,000 | 47,000 | ||||
Issuance of common shares pursuant to the Open Market Sales Agreement (in shares) | 614,401 | |||||
Issuance of common shares pursuant to the Open Market Sales Agreement | $ 2,248,000 | |||||
Issuance of common shares pursuant to the Open Market Sales Agreement | 2,248,000 | |||||
Issuance of common shares pursuant to exercise of options (in shares) | 122,603 | |||||
Issuance of common shares pursuant to exercise of options | 288,000 | $ 490,000 | (202,000) | |||
Currency translation adjustments | (22,000) | (22,000) | ||||
Net loss | (23,251,000) | (23,251,000) | ||||
Ending balance (in shares) at Mar. 31, 2019 | 1,164,000 | 56,255,804 | ||||
Ending balance at Mar. 31, 2019 | 181,209,000 | $ 128,851,000 | $ 882,143,000 | 49,594,000 | (831,187,000) | (48,192,000) |
Beginning balance (in shares) at Dec. 31, 2018 | 1,164,000 | 55,518,800 | ||||
Beginning balance at Dec. 31, 2018 | 200,234,000 | $ 126,136,000 | $ 879,405,000 | 48,084,000 | (805,221,000) | (48,170,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (129,069,000) | |||||
Ending balance (in shares) at Sep. 30, 2019 | 1,164,000 | 56,850,172 | ||||
Ending balance at Sep. 30, 2019 | 83,637,000 | $ 134,405,000 | $ 884,623,000 | 55,385,000 | (942,559,000) | (48,217,000) |
Beginning balance (in shares) at Mar. 31, 2019 | 1,164,000 | 56,255,804 | ||||
Beginning balance at Mar. 31, 2019 | 181,209,000 | $ 128,851,000 | $ 882,143,000 | 49,594,000 | (831,187,000) | (48,192,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Accretion of accumulated dividends on Preferred Shares | 0 | $ 2,762,000 | (2,762,000) | |||
Stock-based compensation | 3,915,000 | 3,915,000 | ||||
Certain fair value adjustments to liability stock option awards | 230,000 | 230,000 | ||||
Issuance of common shares pursuant to the Open Market Sales Agreement (in shares) | 593,689 | |||||
Issuance of common shares pursuant to the Open Market Sales Agreement | $ 2,477,000 | |||||
Issuance of common shares pursuant to the Open Market Sales Agreement | 2,477,000 | |||||
Issuance of common shares pursuant to exercise of options (in shares) | 679 | |||||
Issuance of common shares pursuant to exercise of options | 2,000 | $ 3,000 | (1,000) | |||
Currency translation adjustments | (52,000) | (52,000) | ||||
Net loss | (23,315,000) | (23,315,000) | ||||
Ending balance (in shares) at Jun. 30, 2019 | 1,164,000 | 56,850,172 | ||||
Ending balance at Jun. 30, 2019 | 164,466,000 | $ 131,613,000 | $ 884,623,000 | 53,738,000 | (857,264,000) | (48,244,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Accretion of accumulated dividends on Preferred Shares | 0 | $ 2,792,000 | (2,792,000) | |||
Stock-based compensation | 1,592,000 | 1,592,000 | ||||
Certain fair value adjustments to liability stock option awards | 55,000 | 55,000 | ||||
Currency translation adjustments | 27,000 | 27,000 | ||||
Net loss | (82,503,000) | (82,503,000) | ||||
Ending balance (in shares) at Sep. 30, 2019 | 1,164,000 | 56,850,172 | ||||
Ending balance at Sep. 30, 2019 | 83,637,000 | $ 134,405,000 | $ 884,623,000 | 55,385,000 | (942,559,000) | (48,217,000) |
Beginning balance (in shares) at Dec. 31, 2019 | 1,164,000 | 64,780,314 | ||||
Beginning balance at Dec. 31, 2019 | 72,744,000 | $ 137,285,000 | $ 898,535,000 | 55,246,000 | (970,093,000) | (48,229,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Accretion of accumulated dividends on Preferred Shares | 0 | $ 2,978,000 | (2,978,000) | |||
Stock-based compensation | 1,460,000 | 1,460,000 | ||||
Certain fair value adjustments to liability stock option awards | 180,000 | 180,000 | ||||
Issuance of common shares pursuant to the Open Market Sales Agreement (in shares) | 4,147,081 | |||||
Issuance of common shares pursuant to the Open Market Sales Agreement | $ 12,315,000 | |||||
Issuance of common shares pursuant to the Open Market Sales Agreement | 12,315,000 | |||||
Issuance of common shares pursuant to exercise of options (in shares) | 34,000 | |||||
Issuance of common shares pursuant to exercise of options | 166,000 | $ 249,000 | (83,000) | |||
Unrealized gain on available-for-sale securities | 252,000 | 252,000 | ||||
Net loss | (13,861,000) | (13,861,000) | ||||
Ending balance (in shares) at Mar. 31, 2020 | 1,164,000 | 68,961,395 | ||||
Ending balance at Mar. 31, 2020 | 73,256,000 | $ 140,263,000 | $ 911,099,000 | 56,803,000 | (986,932,000) | (47,977,000) |
Beginning balance (in shares) at Dec. 31, 2019 | 1,164,000 | 64,780,314 | ||||
Beginning balance at Dec. 31, 2019 | 72,744,000 | $ 137,285,000 | $ 898,535,000 | 55,246,000 | (970,093,000) | (48,229,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (46,703,000) | |||||
Ending balance (in shares) at Sep. 30, 2020 | 1,164,000 | 84,618,575 | ||||
Ending balance at Sep. 30, 2020 | 97,345,000 | $ 146,285,000 | $ 965,369,000 | 59,614,000 | (1,025,796,000) | (48,127,000) |
Beginning balance (in shares) at Mar. 31, 2020 | 1,164,000 | 68,961,395 | ||||
Beginning balance at Mar. 31, 2020 | 73,256,000 | $ 140,263,000 | $ 911,099,000 | 56,803,000 | (986,932,000) | (47,977,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Accretion of accumulated dividends on Preferred Shares | 0 | $ 2,995,000 | (2,995,000) | |||
Stock-based compensation | 1,597,000 | 1,597,000 | ||||
Certain fair value adjustments to liability stock option awards | (92,000) | (92,000) | ||||
Issuance of common shares pursuant to the Open Market Sales Agreement (in shares) | 2,291,184 | |||||
Issuance of common shares pursuant to the Open Market Sales Agreement | $ 5,045,000 | |||||
Issuance of common shares pursuant to the Open Market Sales Agreement | 5,045,000 | |||||
Issuance of common shares pursuant to exercise of options (in shares) | 4,000 | |||||
Issuance of common shares pursuant to exercise of options | (86,000) | $ (78,000) | (8,000) | |||
Unrealized gain on available-for-sale securities | (122,000) | (122,000) | ||||
Net loss | (14,087,000) | (14,087,000) | ||||
Ending balance (in shares) at Jun. 30, 2020 | 1,164,000 | 71,256,579 | ||||
Ending balance at Jun. 30, 2020 | 65,511,000 | $ 143,258,000 | $ 916,066,000 | 58,300,000 | (1,004,014,000) | (48,099,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Accretion of accumulated dividends on Preferred Shares | 0 | $ 3,027,000 | (3,027,000) | |||
Stock-based compensation | 1,658,000 | 1,658,000 | ||||
Certain fair value adjustments to liability stock option awards | (137,000) | (137,000) | ||||
Issuance of common shares pursuant to the Open Market Sales Agreement (in shares) | 13,258,096 | |||||
Issuance of common shares pursuant to the Open Market Sales Agreement | $ 48,760,000 | |||||
Issuance of common shares pursuant to the Open Market Sales Agreement | 48,760,000 | |||||
Issuance of common shares pursuant to exercise of options (in shares) | 103,900 | |||||
Issuance of common shares pursuant to exercise of options | 336,000 | $ 543,000 | (207,000) | |||
Unrealized gain on available-for-sale securities | (72,000) | (72,000) | ||||
Currency translation adjustments | 44,000 | 44,000 | ||||
Net loss | (18,755,000) | (18,755,000) | ||||
Ending balance (in shares) at Sep. 30, 2020 | 1,164,000 | 84,618,575 | ||||
Ending balance at Sep. 30, 2020 | $ 97,345,000 | $ 146,285,000 | $ 965,369,000 | $ 59,614,000 | $ (1,025,796,000) | $ (48,127,000) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flow (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
OPERATING ACTIVITIES | ||
Net loss | $ (46,703) | $ (129,069) |
Non-cash items: | ||
Deferred income tax benefit | 0 | (12,661) |
Depreciation | 1,491 | 1,521 |
Gain on sale of property and equipment | 0 | (11) |
Stock-based compensation expense | 4,730 | 6,822 |
Unrealized foreign exchange losses (gains) | 56 | (71) |
Change in fair value of contingent consideration | 348 | (121) |
Impairment of intangible assets | 0 | 43,836 |
Impairment of goodwill | 0 | 22,471 |
Net equity investment loss | 2,544 | 11,497 |
Non-cash royalty revenue | (2,041) | (979) |
Non-cash interest expense | 3,166 | 1,106 |
Net accretion and amortization of investments in marketable securities | 71 | 0 |
Net change in operating items: | ||
Accounts receivable | 129 | (1,057) |
Prepaid expenses and other assets | 350 | 1,839 |
Accounts payable and accrued liabilities | (147) | (1,320) |
Restructuring accrual | (137) | (917) |
Other liabilities | (285) | (541) |
Net cash used in operating activities | (36,428) | (57,655) |
INVESTING ACTIVITIES | ||
Purchase of investments | (28,904) | 0 |
Disposition of investments | 66,548 | 87,675 |
Investment in Genevant | (2,500) | 0 |
Proceeds from sale of property and equipment | 0 | 11 |
Acquisition of property and equipment | (77) | (526) |
Net cash provided by investing activities | 35,067 | 87,160 |
FINANCING ACTIVITIES | ||
Proceeds from sale of future royalties, net | 0 | 18,549 |
Issuance of common shares pursuant to the Open Market Sale agreement | 66,120 | 4,725 |
Issuance of common shares pursuant to exercise of options | 416 | 290 |
Net cash provided by financing activities | 66,536 | 23,564 |
Effect of foreign exchange rate changes on cash and cash equivalents | (56) | 71 |
Increase in cash and cash equivalents | 65,119 | 53,140 |
Cash and cash equivalents, beginning of period | 31,799 | 36,942 |
Cash and cash equivalents, end of period | 96,918 | 90,082 |
Supplemental cash flow information | ||
Preferred shares dividends accrued | $ (9,000) | $ (5,477) |
Nature of business and future o
Nature of business and future operations | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of business and future operations | Nature of business and future operations Arbutus Biopharma Corporation (the “Company” or “Arbutus”) is a clinical-stage biopharmaceutical company primarily focused on developing a cure for people with chronic hepatitis B virus (“HBV”) infection. The Company is advancing multiple drug product candidates that may be combined into a potentially curative regimen for chronic HBV infection. Arbutus has also initiated a drug discovery and development effort for treating coronaviruses, including COVID-19. The Company’s pipeline includes: • AB-729, a subcutaneously-delivered RNA interference (“RNAi”) product candidate currently in a Phase 1a/1b clinical trial. Preliminary positive safety data in single-dose cohorts of healthy subjects and safety and efficacy data in the 60 mg and 180 mg single-dose cohorts in subjects with chronic HBV infection were reported in March 2020 and additional follow-on week 12 data for the 60 mg single-dose cohort were reported in May 2020. Week 12 data for the 90 mg single-dose cohort were reported in September 2020. The Company is dosing two 60 mg multi-dose cohorts of subjects with chronic HBV infection with dosing intervals of every four and eight weeks, respectively. Results from the 60 mg multi-dose cohort with a dosing interval of every four weeks and additional follow-up data on the 60 mg and 90 mg single-dose cohorts are expected to be disclosed as part of an oral presentation at the upcoming American Association for the Study of Liver Disease Conference (“AASLD”) in November. Separately, results from the 60 mg multi-dose cohort with a dosing interval of every eight weeks and a 90 mg single-dose cohort in HBV positive subjects are expected in the fourth quarter of 2020. Additionally, the Company is dosing two 90 mg multi-dose cohorts with chronic HBV infection with dosing intervals of every eight and twelve weeks, respectively; • AB-836, a next-generation capsid inhibitor product candidate currently advancing through CTA/IND-enabling studies, which the Company expects to be completed by the end of 2020; and • other compounds early in the development process, including oral compounds that inhibit PD-L1 and a next-generation oral HBV RNA destabilizer. The Company’s research and development activities and the commercialization of its products are dependent on its ability to successfully obtain adequate financing through a combination of financing activities and operations. The success of the Company is dependent on progressing its pipeline and subsequently obtaining the necessary regulatory approvals to bring its products to market and achieving profitable operations. It is not possible to predict either the outcome of the Company’s existing or future research and development programs or the Company’s ability to continue to fund these programs in the future, nor to predict whether it will be successful in obtaining the necessary regulatory approvals to bring its products to market. COVID-19 In December 2019, an outbreak of a novel strain of coronavirus (COVID-19) was identified in Wuhan, China. The virus continues to spread globally, has been declared a pandemic by the World Health Organization and has spread to nearly every country in the world. The impact of the pandemic has been, and will likely continue to be, extensive in many aspects of society. The pandemic has resulted in and will likely continue to result in significant disruptions to businesses. A number of countries and other jurisdictions around the world have implemented extreme measures in an attempt to slow the spread of the virus. These measures include the closing of businesses and requiring people to stay in their homes, the latter of which raises uncertainty regarding the ability to travel to hospitals in order to participate in clinical trials. Additional measures that have had, and will likely continue to have, a major impact on clinical development, at least in the near-term, include shortages and delays in the supply chain, and prohibitions in certain countries on enrolling subjects in new clinical trials. Despite the challenges of COVID-19, the Company has not had to alter its objectives for 2020. However, future disruptions related to the COVID-19 |
Significant accounting policies
Significant accounting policies | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Significant accounting policies | Significant accounting policies Basis of presentation These unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles for interim financial statements and accordingly, do not include all disclosures required for annual financial statements. These statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2019 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (the “2019 Form 10-K”). These unaudited condensed consolidated financial statements reflect, in the opinion of management, all adjustments and reclassifications necessary to fairly present the Company’s financial position as of September 30, 2020, the Company’s results of operations for the three and nine months ended September 30, 2020 and the Company’s cash flows for the nine months ended September 30, 2020. The results of operations for the three and nine months ended September 30, 2020 are not necessarily indicative of the results for the full year. These unaudited condensed consolidated financial statements follow the same significant accounting policies as those described in the notes to the audited consolidated financial statements of the Company for the year ended December 31, 2019, except as described below under Recent Accounting Pronouncements. Principles of consolidation These unaudited condensed consolidated financial statements include the accounts of the Company and its two wholly-owned subsidiaries, Arbutus Biopharma Inc. (“Arbutus Inc.”) and Arbutus Biopharma US Holdings, Inc. All intercompany transactions and balances have been eliminated in consolidation. Net loss attributable to common shareholders per share The Company follows the two-class method when computing net loss attributable to common shareholders per share as the Company has issued Series A participating convertible preferred shares (the “Preferred Shares”), as further described in note 11, that meet the definition of participating securities. The Preferred Shares entitle the holders to participate in dividends but do not require the holders to participate in losses of the Company. Accordingly, if the Company reports a net loss attributable to holders of the Company’s common shares, net losses are not allocated to holders of the Preferred Shares. Net loss attributable to common shareholders per share is calculated based on the weighted average number of common shares outstanding. The calculation of diluted net loss attributable to common shareholders per share does not differ from the calculation of basic net loss attributable to common shareholders per share, as the effect of the Company’s dilutive potential common shares was anti-dilutive. During the nine months ended September 30, 2020 and 2019, potential common shares of 31.6 million and 28.2 million, respectively, consisting of the “if-converted” number of Preferred Shares and outstanding stock and Employee Stock Purchase Plan (“ESPP”) options, were excluded from the calculation of diluted net loss per common share because their inclusion would be anti-dilutive. Revenue recognition The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers (”ASC 606”), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers under a five-step model: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when or as a performance obligation is satisfied. The Company generates revenue primarily through collaboration agreements and license agreements. Such agreements may require the Company to deliver various rights and/or services, including intellectual property rights or licenses and research and development services. Under such agreements, the Company is generally eligible to receive non-refundable upfront payments, funding for research and development services, milestone payments, and royalties. In contracts where the Company has more than one performance obligation to provide its customer with goods or services, each performance obligation is evaluated to determine whether it is distinct based on whether (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available and (ii) the good or service is separately identifiable from other promises in the contract. The consideration under the contract is then allocated between the distinct performance obligations based on their respective relative stand-alone selling prices. The estimated stand-alone selling price of each deliverable reflects the Company’s best estimate of what the selling price would be if the deliverable was regularly sold on a stand-alone basis and is determined by reference to market rates for the good or service when sold to others or by using an adjusted market assessment approach if the selling price on a stand-alone basis is not available. The consideration allocated to each distinct performance obligation is recognized as revenue when control is transferred to the customer for the related goods or services. Consideration associated with at-risk substantive performance milestones, including sales-based milestones, is recognized as revenue when it is probable that a significant reversal of the cumulative revenue recognized will not occur. Sales-based royalties received in connection with licenses of intellectual property are subject to a specific exception in the revenue standards, whereby the consideration is not included in the transaction price and recognized in revenue until the customer’s subsequent sales or usages occur. Segment information The Company operates as a single segment. Recent accounting pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position or results of operations upon adoption. In June 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments |
Fair value of financial instrum
Fair value of financial instruments | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair value of financial instruments | Fair value of financial instruments The Company measures certain financial instruments and other items at fair value. To determine the fair value, the Company uses the fair value hierarchy for inputs used in measuring fair value that maximize the use of observable inputs and minimize the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use to value an asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs are inputs based on assumptions about the factors market participants would use to value an asset or liability. The three levels of inputs that may be used to measure fair value are as follows: • Level 1 inputs are quoted market prices for identical instruments available in active markets. • Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability either directly or indirectly. If the asset or liability has a contractual term, the input must be observable for substantially the full term. An example includes quoted market prices for similar assets or liabilities in active markets. • Level 3 inputs are unobservable inputs for the asset or liability and will reflect management’s assumptions about market assumptions that would be used to price the asset or liability. Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. The carrying values of cash and cash equivalents, investments in marketable securities, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of these financial instruments. To determine the fair value of the contingent consideration (note 8), the Company uses a probability weighted assessment of the likelihood the milestones would be met and the estimated timing of such payments, and then the potential contingent payments were discounted to their present value using a probability adjusted discount rate that reflects the early stage nature of the development program, time to complete the program development, and overall biotech indices. The Company determined the fair value of the contingent consideration was $3.3 million as of September 30, 2020 and the increase of $0.3 million has been recorded as a component of total operating expenses in the statement of operations and comprehensive loss for the nine months ended September 30, 2020. The assumptions used in the discounted cash flow model are level 3 inputs as defined above. The Company assessed the sensitivity of the fair value measurement to changes in these unobservable inputs, and determined that changes within a reasonable range would not result in a materially different assessment of fair value. The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis, and indicates the level within the fair value hierarchy of the valuation techniques used to determine such fair value: Level 1 Level 2 Level 3 Total As of September 30, 2020 (in thousands) Assets Cash and cash equivalents $ 96,918 $ — $ — $ 96,918 Short-term investments 21,378 — — 21,378 Total 118,296 — — 118,296 Liabilities Liability-classified options — — 317 317 Contingent consideration — — 3,301 3,301 Total $ — $ — $ 3,618 $ 3,618 Level 1 Level 2 Level 3 Total As of December 31, 2019 (in thousands) Assets Cash and cash equivalents $ 31,799 $ — $ — $ 31,799 Short-term investments 59,035 — — 59,035 Total 90,834 — — 90,834 Liabilities Liability-classified stock option awards — — 253 253 Contingent consideration — — 2,953 2,953 Total $ — $ — $ 3,206 $ 3,206 The following table presents the changes in fair value of the Company’s liability-classified stock option awards: Liability at beginning of the period Fair value of liability-classified options exercised in the period Increase (decrease) in fair value of liability Liability at end of the period (in thousands) Nine Months Ended September 30, 2020 $ 253 $ — $ 64 $ 317 Nine Months Ended September 30, 2019 $ 479 $ — $ (393) $ 86 The following table presents the changes in fair value of the Company’s contingent consideration: Liability at beginning of the period Increase (decrease) in fair value of liability Liability at end of the period (in thousands) Nine Months Ended September 30, 2020 $ 2,953 $ 348 $ 3,301 Nine Months Ended September 30, 2019 $ 3,126 $ (121) $ 3,005 |
Investments in marketable secur
Investments in marketable securities | 9 Months Ended |
Sep. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments in marketable securities | Investments in marketable securities Investments in marketable securities consisted of the following: Amortized Cost Gross Unrealized Gain (1) Gross Unrealized Loss (1) Fair Value As of September 30, 2020 (in thousands) Cash equivalents US government money market fund $ 65,327 $ — $ — $ 65,327 Total $ 65,327 $ — $ — $ 65,327 Investments in marketable securities US government agency bonds $ 11,300 $ 26 $ — $ 11,326 US government bonds 10,020 32 — 10,052 Total $ 21,320 $ 58 $ — $ 21,378 (1) Gross unrealized gain (loss) is pre-tax and is reported in other comprehensive loss. Amortized Cost Gross Unrealized Gain (1) Gross Unrealized Loss (1) Fair Value As of December 31, 2019 (in thousands) Cash equivalents US government money market fund $ 4,106 $ — $ — $ 4,106 US government agency bonds 1,511 — — 1,511 US treasury bills 1,499 — — 1,499 Total $ 7,116 $ — $ — $ 7,116 Investments in marketable securities US government agency bonds $ 19,863 $ 2 $ (1) $ 19,864 US treasury bills 15,926 2 (1) 15,927 US government bonds 23,246 — (2) 23,244 Total $ 59,035 $ 4 $ (4) $ 59,035 (1) Gross unrealized gain (loss) is pre-tax and is reported in other comprehensive loss. The contractual term to maturity of the $21.4 million of short-term marketable securities held by the Company as of September 30, 2020 is less than one year. As of December 31, 2019, the Company’s $59.0 million of marketable securities also had contractual maturities of less than one year. |
Investment in Genevant
Investment in Genevant | 9 Months Ended |
Sep. 30, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Genevant | Investment in Genevant In April 2018, Arbutus entered into an agreement with Roivant Sciences Ltd. (“Roivant”), its largest shareholder, to launch Genevant Sciences Ltd. (“Genevant”), a company focused on the discovery, development, and commercialization of a broad range of RNA-based therapeutics enabled by Arbutus’ lipid nanoparticle (“LNP”) and ligand conjugate delivery technologies. Arbutus licensed exclusive rights to its LNP and ligand conjugate delivery platforms to Genevant for RNA-based applications outside of HBV, except to the extent certain rights had already been licensed to other third parties. Arbutus retained all rights to its LNP and conjugate delivery platforms for HBV. Arbutus is entitled to receive tiered low single-digit royalties on future sales of Genevant products covered by the licensed patents. If Genevant sub-licenses the intellectual property licensed by Arbutus to Genevant, Arbutus would receive upon the commercialization of a product developed by such sub-licensee the lesser of (i) twenty percent of the revenue received by Genevant for such sublicensing and (ii) tiered low single-digit royalties on product sales by the sublicensee. On July 23, 2020, the United States Patent and Trademark Office before the Patent Trial and Appeal Board ("PTAB") announced their decision in Moderna Therapeutics, Inc.'s challenge of the validity of U.S. Patent 8,058,069 ("the '069 Patent"). In this decision, the PTAB determined no challenged claims were unpatentable. While Arbutus is the patent holder, this patent has been licensed to Genevant. The '069 Patent was included in the license agreement between Genevant and Arbutus. On July 31, 2020, Genevant was recapitalized through an equity investment and conversion of previously issued convertible debt securities held by Roivant. In addition, Arbutus participated in the recapitalization of Genevant with an investment of $2.5 million. Arbutus determined that this $2.5 million additional investment in Genevant represented the funding of prior losses and accordingly, the Company recorded the amount as an equity investment loss on the Condensed Consolidated Statements of Operations and Comprehensive Loss during the three months ended September 30, 2020. Following the recapitalization, Arbutus owned approximately 16% of the common equity of Genevant. In connection with the recapitalization, Genevant, Arbutus and Roivant entered into an Amended and Restated Shareholders Agreement that provides Roivant with substantial control of Genevant. Arbutus has a non-voting observer seat on Genevant’s Board of Directors. Due to Arbutus’ loss of significant influence with respect to Genevant as a result of the recapitalization, Arbutus discontinued the use of the equity method of accounting for its interest in Genevant. Following the recapitalization, Arbutus accounts for its interest in Genevant as equity securities without readily determinable fair values. Accordingly, an estimate of the fair value of the securities is based on the original cost less previously recognized equity method losses, less impairments, plus or minus changes resulting from observable price changes in orderly transactions for identical or a similar Genevant securities. As of September 30, 2020, the carrying value of Arbutus’ investment in Genevant was zero and Arbutus owned approximately 16% of the common equity of Genevant. Arbutus’ entitlement to receive future royalties or sublicensing revenue from Genevant was not impacted by the recapitalization. |
Accounts payable and accrued li
Accounts payable and accrued liabilities | 9 Months Ended |
Sep. 30, 2020 | |
Payables and Accruals [Abstract] | |
Accounts payable and accrued liabilities | Accounts payable and accrued liabilities Accounts payable and accrued liabilities are comprised of the following: September 30, 2020 December 31, 2019 (in thousands) Trade accounts payable $ 852 $ 2,398 Research and development accruals 2,719 1,433 Professional fee accruals 447 809 Payroll accruals 2,844 2,314 Site consolidation accrual — 137 Other accrued liabilities 51 144 Total accounts payable and accrued liabilities $ 6,913 $ 7,235 |
Sale of future royalties
Sale of future royalties | 9 Months Ended |
Sep. 30, 2020 | |
Other Liabilities Disclosure [Abstract] | |
Sale of future royalties | Sale of future royalties On July 2, 2019, the Company entered into a Purchase and Sale Agreement (the “Agreement”) with the Ontario Municipal Employees Retirement System (or “OMERS”), pursuant to which the Company sold to OMERS part of its royalty interest on future global net sales of ONPATTRO® (Patisiran) (“ONPATTRO”), an RNAi therapeutic currently being sold by Alnylam Pharmaceuticals, Inc. (“Alnylam”). ONPATTRO utilizes Arbutus’ LNP technology, which was licensed to Alnylam pursuant to the Cross-License Agreement, dated November 12, 2012, by and between the Company and Alnylam (the “LNP License Agreement”). Under the terms of the LNP License Agreement, the Company is entitled to tiered royalty payments on global net sales of ONPATTRO ranging from 1.00% to 2.33% after offsets, with the highest tier applicable to annual net sales above $500 million. This royalty interest was sold to OMERS, effective as of January 1, 2019, for $20 million in gross proceeds before advisory fees. OMERS will retain this entitlement until it has received $30 million in royalties, at which point 100% of such royalty interest on future global net sales of ONPATTRO will revert to the Company. OMERS has assumed the risk of collecting up to $30 million of future royalty payments from Alnylam and Arbutus is not obligated to reimburse OMERS if they fail to collect any such future royalties. The $30 million in royalties to be collected by OMERS is accounted for as a liability, with the difference between the liability and the gross proceeds received accounted for as a discount. The discount, as well as $1.5 million of transaction costs, will be amortized as interest expense based on the projected balance of the liability as of the beginning of each period. Over the course of the Agreement, the actual interest rate will be affected by the amount and timing of royalty revenue recognized and changes in the timing of forecasted royalty revenue. On a quarterly basis, the Company will reassess the expected timing of the royalty revenue, recalculate the amortization and effective interest rate and adjust the accounting prospectively as needed. As of September 30, 2020, the effective annual interest rate was approximately 22%. The Company will recognize non-cash royalty revenue related to the sales of ONPATTRO during the term of the Agreement. As royalties are remitted to OMERS from Alnylam, the balance of the recognized liability will be effectively repaid over the life of the Agreement. From the inception of the royalty sale through September 30, 2020, the Company has recorded an aggregate of $3.7 million of non-cash royalty revenue for royalties earned by OMERS. There are a number of factors that could materially affect the amount and timing of royalty payments from Alnylam, none of which are within the Company’s control. During the three and nine months ended September 30, 2020, the Company recognized non-cash royalty revenue of $0.7 million and $2.0 million, respectively, and $1.1 million and $3.2 million of related non-cash interest expense, respectively. During the three and nine months ended September 30, 2019, the Company recognized non-cash royalty revenue of $0.5 million and $1.0 million, respectively, and $1.1 million of related non-cash interest expense during the three and nine months ended September 30, 2019. The table below shows the activity related to the net liability for 2020: Nine Months Ended September 30, 2020 (in thousands) Net liability related to sale of future royalties - beginning balance $ 18,992 Non-cash royalty revenue (2,041) Non-cash interest expense 3,166 Net liability related to sale of future royalties - ending balance $ 20,117 In addition to the royalty from the LNP License Agreement, the Company is also receiving a second, lower royalty interest on global net sales of ONPATTRO originating from a settlement agreement and subsequent license agreement with Acuitas Therapeutics, Inc. (“Acuitas”). The royalty from Acuitas has been retained by the Company and was not part of the royalty sale to OMERS. |
Contingencies and commitments
Contingencies and commitments | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies and commitments | Contingencies and commitments Product development partnership with the Canadian Government The Company entered into a Technology Partnerships Canada (“TPC”) agreement with the Canadian Federal Government on November 12, 1999. Under this agreement, TPC agreed to fund 27% of the costs incurred by the Company, prior to March 31, 2004, in the development of certain oligonucleotide product candidates up to a maximum contribution from TPC of $7.2 million (C$9.3 million). The Company received a cumulative contribution of $2.7 million (C$3.7 million). In return for the funding provided by TPC, the Company agreed to pay royalties on the share of future licensing and product revenue, if any, that is received by the Company on certain non-RNAi oligonucleotide product candidates covered by the funding under the agreement. These royalties are payable until a certain cumulative payment amount is achieved or until a pre-specified date. In addition, until a cumulative amount equal to the funding actually received under the agreement has been paid to TPC, the Company agreed to pay 2.5% royalties on any royalties the Company receives on sales of Acrotech Biopharma LLC’s Marqibo® (formerly Spectrum Pharmaceuticals, Inc.). For each of the nine months ended September 30, 2020 and 2019, the Company earned royalties on Marqibo sales in the amount of $0.2 million. The resulting royalties payable by the Company to TPC were not material in either period. The cumulative amount paid or accrued up to September 30, 2020 was less than $0.1 million, resulting in the contingent amount due to TPC being $2.7 million (C$3.7 million). Arbitration with the University of British Columbia Certain early work on lipid nanoparticle delivery systems and related inventions was undertaken at the University of British Columbia (“UBC”), as well as by the Company that was subsequently assigned to UBC. These inventions are licensed to the Company by UBC under a license agreement, initially entered into in 1998 and amended in 2001, 2006 and 2007. The Company has granted sublicenses under the UBC license to certain third parties, including Alnylam. In November 2014, UBC filed a demand for arbitration against the Company and in January 2015, filed a Statement of Claim, which alleged entitlement to $3.5 million in allegedly unpaid royalties based on publicly available information, and an unspecified amount based on non-public information. UBC also sought interest and costs, including legal fees. The Company filed its Statement of Defense to UBC’s Statement of Claims, as well as a Counterclaim involving a patent application that the Company alleged UBC wrongly licensed to a third party. The proceedings were divided into three phases, with the first hearing taking place in June 2017. In the first phase, the arbitrator determined which agreements are sublicense agreements within UBC’s claim. Also in the first phase, UBC updated its alleged entitlement from $3.5 million originally claimed to seek $10.9 million in alleged unpaid royalties, plus interest arising from payments as early as 2008. The arbitrator also held in the first phase of the arbitration that the patent application that is the subject of the Counterclaim was not required to be licensed to the Company. The second phase of the arbitration took place in the second quarter of 2019. In August 2019, the arbitrator issued his decision for the second phase of the arbitration, awarding UBC $5.9 million, which includes interest of approximately $2.6 million. The Company paid the $5.9 million award to UBC in September 2019. The arbitrator also held that the third phase of the arbitration, which would address patent validity, should the Company choose to pursue a third phase, would not provide a defense to the award. An award for costs and attorneys’ fees is still to be determined. The Company has accrued $0.4 million for an estimate of a potential award for costs and attorneys’ fees as of September 30, 2020. Stock Purchase Agreement with Enantigen In October 2014, Arbutus Inc., our wholly-owned subsidiary, acquired all of the outstanding shares of Enantigen Therapeutics, Inc. (“Enantigen”) pursuant to a stock purchase agreement. Through this transaction, Arbutus Inc. acquired an HBV surface antigen secretion inhibitor program and a capsid assembly inhibitor program. Under the stock purchase agreement, Arbutus Inc. agreed to pay up to a total of $21.0 million to Enantigen’s selling stockholders upon the achievement of specified development and regulatory milestones for (a) the first two products that contain either a capsid compound or an HBV surface antigen compound that is covered by a patent acquired under this agreement, or (b) a capsid compound from an agreed upon list of compounds. The development milestones are tied to programs which are no longer under development by the Company, and therefore the contingency related to these milestones has been reduced to zero. An additional $102.5 million may also be paid to Enantigen’s selling stockholders related to the achievement of certain sales performance milestones in connection with the sale of the first commercialized product by Arbutus Inc. for the treatment of HBV, regardless of whether such product is based upon assets acquired under this agreement, and a low single-digit royalty on net sales of such first commercialized HBV product, up to a maximum royalty payment of $1.0 million that, if paid, would be offset against Arbutus Inc.’s milestone payment obligations. |
Collaborations, contracts and l
Collaborations, contracts and licensing agreements | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Collaborations, contracts and licensing agreements | Collaborations, contracts and licensing agreements Revenue contracts are described in detail in the Overview section of Part II, Item 8, “Financial Statements and Supplementary Data” in the Company’s 2019 Form 10-K. Assembly BioSciences, Inc. In August 2020, the Company and Assembly BioSciences, Inc. (“Assembly”) entered into a clinical collaboration agreement to evaluate the Company’s proprietary GalNAC delivered RNAi therapeutic AB-729 in combination with Assembly’s lead HBV core inhibitor (capsid inhibitor) candidate vebicorvir and a standard-of-care nucleos(t)ide reverse transcriptase inhibitor (Nrtl) therapy for the treatment of patients with chronic HBV infection. The companies will share in the costs of the collaboration and the associated clinical trial is projected to initiate in the first half of 2021. The Company incurred no costs related to the collaboration during the three months ended September 30, 2020. Alnylam Pharmaceuticals, Inc. and Acuitas Therapeutics, Inc. The Company has two royalty entitlements to Alnylam’s global net sales of ONPATTRO. In 2012, the Company entered into a license agreement with Alnylam that entitles Alnylam to develop and commercialize products with the Company’s LNP technology. Alnylam’s ONPATTRO, which represents the first approved application of the Company’s LNP technology, was approved by the United States Food and Drug Administration (“FDA”) and the European Medicines Agency (“EMA”) during the third quarter of 2018 and was launched by Alnylam immediately upon approval in the United States. Under the terms of this license agreement, the Company is entitled to tiered royalty payments on global net sales of ONPATTRO ranging from 1.00% - 2.33% after offsets, with the highest tier applicable to annual net sales above $500 million. This royalty interest was sold to OMERS, effective as of January 1, 2019, for $20 million in gross proceeds before advisory fees. OMERS will retain this entitlement until it has received $30 million in royalties, at which point 100% of this royalty entitlement on future global net sales of ONPATTRO will revert back to the Company. OMERS has assumed the risk of collecting up to $30 million of future royalty payments from Alnylam and the Company is not obligated to reimburse OMERS if they fail to collect any such future royalties. If this royalty entitlement reverts to the Company, it has the potential to provide an active royalty stream or to be otherwise monetized again in full or in part. The Company also has rights to a second, lower royalty interest on global net sales of ONPATTRO originating from a settlement agreement and subsequent license agreement with Acuitas. This royalty entitlement from Acuitas has been retained by the Company and was not part of the royalty entitlement sale to OMERS. Revenues are summarized in the following table: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands) (in thousands) Revenue from collaborations and licenses Acuitas Therapeutics, Inc. $ 774 $ 516 $ 2,288 $ 1,161 Gritstone Oncology, Inc. — 1,722 — 1,789 Other milestone and royalty payments 54 362 199 464 Non-cash royalty revenue Alnylam Pharmaceuticals, Inc. 695 461 2,041 979 Total revenue $ 1,523 $ 3,061 $ 4,528 4,393 |
Stockholders_ equity
Stockholders’ equity | 9 Months Ended |
Sep. 30, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders’ equity | Stockholders’ equity Open Market Sales Agreement In December 2018, the Company entered into an Open Market Sale Agreement with Jefferies LLC (“Jefferies”) (the “Sale Agreement”), under which it could issue and sell common shares, from time to time, for an aggregate sales price of up to $50.0 million. In December 2019, the Company entered into an amendment to the Sale Agreement with Jefferies (the “2019 Amendment”) in connection with the filing of a shelf registration statement on Form S-3 (File No. 333-235674), filed with the SEC on December 23, 2019 (the “Shelf Registration Statement”). The 2019 Amendment revised the original Sale Agreement to reflect that the Company could sell its common shares, without par value, from time to time, for an aggregate sales price of up to $50 million, under the Shelf Registration Statement. In July 2020, the Company fully utilized the remaining availability under the Sale Agreement, as amended by the 2019 Amendment. In August 2020, the Company entered into a new amendment to the Sale Agreement (the “2020 Amendment”) with Jefferies. Pursuant to the 2020 Amendment, the Company can issue and sell common shares, from time to time, for an aggregate sales price of up to $75 million under the Sale Agreement, as amended. For the nine months ended September 30, 2019, the Company issued 1,208,090 common shares pursuant to the Sale Agreement resulting in net proceeds of approximately $5.2 million. There were no shares issued under the Sale Agreement during the three months ended September 30, 2019. During the three and nine months ended September 30, 2020, the Company issued 13,258,096 and 19,696,361 common shares pursuant to the Sale Agreement, as amended, resulting in net proceeds of approximately $48.8 million and $66.1 million, respectively. As of September 30, 2020, there was approximately $62.3 million available under the Sale Agreement, as amended. Stock-based compensation The table below summarizes information about the Company’s stock based compensation for the three and nine months ended September 30, 2020 and 2019 and the expense recognized in the condensed consolidated statements of operations: Three Months Ended September 30, 2020 Three Months Ended September 30, 2019 Nine Months Ended September 30, 2020 Nine Months Ended September 30, 2019 (in thousands, except share and per share data) Options granted during period 188,600 242,400 2,856,150 3,018,000 Weighted average exercise price $ 2.25 $ 1.57 $ 3.21 $ 3.41 Research and development $ 808 $ 817 $ 2,341 $ 2,361 General and administrative 880 699 2,389 4,461 Total stock compensation expense $ 1,688 $ 1,516 $ 4,730 $ 6,822 Awards with performance conditions are expensed when it is probable that the performance condition will be achieved. For each of the three and nine months ended September 30, 2020, $0.3 million was expensed for stock option awards with performance conditions. These expenses are included in the table above. Employee Stock Purchase Plan In May 2020, the Company’s stockholders approved the 2020 Employee Stock Purchase Plan which became effective on May 28, 2020. A total of 1.5 million common shares were reserved for issuance under the ESPP. Company employees contribute funds via payroll deductions, which are used to buy Company common shares at a discount of up to 15% based on the lower of the price at the start of the offering period and at the end of the relevant purchase period within such offering period. The initial offering period under the ESPP is September 1, 2020 through August 31, 2021 with purchase dates set on February 26, 2021 and August 31, 2021. All 1.5 million common shares remained available for future issuance under the plan at September 30, 2020. For the three and nine months ended September 30, 2020, the Company recognized less than $0.1 million of stock-based compensation expense related to the ESPP, which is included in the table above. Series A Preferred Shares In October 2017, the Company entered into a subscription agreement with Roivant for the sale of 1,164,000 Preferred Shares for gross proceeds of $116.4 million. These Preferred Shares are non-voting and accrue an 8.75% per annum coupon in the form of additional Preferred Shares, compounded annually, until October 16, 2021, at which time all the Preferred Shares will be subject to mandatory conversion into common shares (subject to limited exceptions in the event of certain fundamental corporate transactions relating to Arbutus’s capital structure or assets, which would permit earlier conversion at Roivant’s option). The conversion price is $7.13 per share, which will result in the Preferred Shares being converted into approximately 23 million common shares. After conversion of the Preferred Shares into common shares, based on the number of common shares outstanding as of September 30, 2020, Roivant will hold approximately 36% of the Company’s common shares. Roivant agreed to a four four The Company records the Preferred Shares wholly as equity under ASC 480, Distinguishing Liabilities From Equity, with no bifurcation of the conversion feature from the host contract, given that the Preferred Shares cannot be cash settled and the redemption features are within the Company’s control, which include a fixed conversion ratio with predetermined timing and proceeds. The Company accrues for the 8.75% per annum compounding coupon at each reporting period end date as an increase to preferred share capital, and an increase to deficit (see Condensed Consolidated Statement of Stockholders’ Equity). |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions On July 31, 2020, Genevant was recapitalized through an equity investment and conversion of previously issued convertible debt securities held by Roivant. In addition, Arbutus participated in the recapitalization with an investment of $2.5 million. Following the recapitalization, Arbutus owned approximately 16% of the common equity of Genevant. See note 5 for more information. Through the first quarter of 2019, the Company purchased certain research and development services from Genevant. These services were billed at agreed hourly rates and were reflective of market rates for such services. The total cost of these services during 2019 was less than $0.1 million, which was included in the Condensed Consolidated Statement of Operations under research and development. There were no such costs incurred during 2020. Conversely, Genevant purchased certain administrative and transitional services from the Company totaling less than $35 thousand for each of the three and nine months ended September 30, 2020. The total income from these services was $40 thousand and $284 thousand for the three and nine months ended September 30, 2019. This income is netted against research and development expenses in the condensed consolidated statements of operations. In addition, during 2019 Genevant had a sublease for 17,900 square feet in the Company’s Burnaby facility. Sublease income from Genevant was $21 thousand and $145 thousand for the three and nine months ended September 30, 2019, and was netted against site consolidation costs and lease liability. The Company’s Burnaby facility lease and the corresponding sublease to Genevant expired on July 31, 2019. |
Significant accounting polici_2
Significant accounting policies (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation These unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles for interim financial statements and accordingly, do not include all disclosures required for annual financial statements. These statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2019 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (the “2019 Form 10-K”). These unaudited condensed consolidated financial statements reflect, in the opinion of management, all adjustments and reclassifications necessary to fairly present the Company’s financial position as of September 30, 2020, the Company’s results of operations for the three and nine months ended September 30, 2020 and the Company’s cash flows for the nine months ended September 30, 2020. The results of operations for the three and nine months ended September 30, 2020 are not necessarily indicative of the results for the full year. These unaudited condensed consolidated financial statements follow the same significant accounting policies as those described in the notes to the audited consolidated financial statements of the Company for the year ended December 31, 2019, except as described below under Recent Accounting Pronouncements. |
Principles of consolidation | Principles of consolidation These unaudited condensed consolidated financial statements include the accounts of the Company and its two wholly-owned subsidiaries, Arbutus Biopharma Inc. (“Arbutus Inc.”) and Arbutus Biopharma US Holdings, Inc. All intercompany transactions and balances have been eliminated in consolidation. |
Net loss attributable to common shareholders per share | Net loss attributable to common shareholders per share The Company follows the two-class method when computing net loss attributable to common shareholders per share as the Company has issued Series A participating convertible preferred shares (the “Preferred Shares”), as further described in note 11, that meet the definition of participating securities. The Preferred Shares entitle the holders to participate in dividends but do not require the holders to participate in losses of the Company. Accordingly, if the Company reports a net loss attributable to holders of the Company’s common shares, net losses are not allocated to holders of the Preferred Shares. |
Revenue recognition | Revenue recognition The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers (”ASC 606”), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers under a five-step model: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when or as a performance obligation is satisfied. The Company generates revenue primarily through collaboration agreements and license agreements. Such agreements may require the Company to deliver various rights and/or services, including intellectual property rights or licenses and research and development services. Under such agreements, the Company is generally eligible to receive non-refundable upfront payments, funding for research and development services, milestone payments, and royalties. In contracts where the Company has more than one performance obligation to provide its customer with goods or services, each performance obligation is evaluated to determine whether it is distinct based on whether (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available and (ii) the good or service is separately identifiable from other promises in the contract. The consideration under the contract is then allocated between the distinct performance obligations based on their respective relative stand-alone selling prices. The estimated stand-alone selling price of each deliverable reflects the Company’s best estimate of what the selling price would be if the deliverable was regularly sold on a stand-alone basis and is determined by reference to market rates for the good or service when sold to others or by using an adjusted market assessment approach if the selling price on a stand-alone basis is not available. The consideration allocated to each distinct performance obligation is recognized as revenue when control is transferred to the customer for the related goods or services. Consideration associated with at-risk substantive performance milestones, including sales-based milestones, is recognized as revenue when it is probable that a significant reversal of the cumulative revenue recognized will not occur. Sales-based royalties received in connection with licenses of intellectual property are subject to a specific exception in the revenue standards, whereby the consideration is not included in the transaction price and recognized in revenue until the customer’s subsequent sales or usages occur. |
Segment information | Segment informationThe Company operates as a single segment. |
Recent accounting pronouncements | Recent accounting pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position or results of operations upon adoption. In June 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments |
Fair value of financial instruments | Fair value of financial instruments The Company measures certain financial instruments and other items at fair value. To determine the fair value, the Company uses the fair value hierarchy for inputs used in measuring fair value that maximize the use of observable inputs and minimize the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use to value an asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs are inputs based on assumptions about the factors market participants would use to value an asset or liability. The three levels of inputs that may be used to measure fair value are as follows: • Level 1 inputs are quoted market prices for identical instruments available in active markets. • Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability either directly or indirectly. If the asset or liability has a contractual term, the input must be observable for substantially the full term. An example includes quoted market prices for similar assets or liabilities in active markets. • Level 3 inputs are unobservable inputs for the asset or liability and will reflect management’s assumptions about market assumptions that would be used to price the asset or liability. Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. The carrying values of cash and cash equivalents, investments in marketable securities, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of these financial instruments. |
Fair value of financial instr_2
Fair value of financial instruments (Tables) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2020 | Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | ||
Assets and liabilities measured at fair value on a recurring basis | The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis, and indicates the level within the fair value hierarchy of the valuation techniques used to determine such fair value: Level 1 Level 2 Level 3 Total As of September 30, 2020 (in thousands) Assets Cash and cash equivalents $ 96,918 $ — $ — $ 96,918 Short-term investments 21,378 — — 21,378 Total 118,296 — — 118,296 Liabilities Liability-classified options — — 317 317 Contingent consideration — — 3,301 3,301 Total $ — $ — $ 3,618 $ 3,618 Level 1 Level 2 Level 3 Total As of December 31, 2019 (in thousands) Assets Cash and cash equivalents $ 31,799 $ — $ — $ 31,799 Short-term investments 59,035 — — 59,035 Total 90,834 — — 90,834 Liabilities Liability-classified stock option awards — — 253 253 Contingent consideration — — 2,953 2,953 Total $ — $ — $ 3,206 $ 3,206 | |
Changes in fair value of liability option | The following table presents the changes in fair value of the Company’s liability-classified stock option awards: Liability at beginning of the period Fair value of liability-classified options exercised in the period Increase (decrease) in fair value of liability Liability at end of the period (in thousands) Nine Months Ended September 30, 2020 $ 253 $ — $ 64 $ 317 Nine Months Ended September 30, 2019 $ 479 $ — $ (393) $ 86 | |
Schedule of changes in fair value of contingent consideration | The following table presents the changes in fair value of the Company’s contingent consideration: Liability at beginning of the period Increase (decrease) in fair value of liability Liability at end of the period (in thousands) Nine Months Ended September 30, 2020 $ 2,953 $ 348 $ 3,301 Nine Months Ended September 30, 2019 $ 3,126 $ (121) $ 3,005 |
Investments in marketable sec_2
Investments in marketable securities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable securities | Investments in marketable securities consisted of the following: Amortized Cost Gross Unrealized Gain (1) Gross Unrealized Loss (1) Fair Value As of September 30, 2020 (in thousands) Cash equivalents US government money market fund $ 65,327 $ — $ — $ 65,327 Total $ 65,327 $ — $ — $ 65,327 Investments in marketable securities US government agency bonds $ 11,300 $ 26 $ — $ 11,326 US government bonds 10,020 32 — 10,052 Total $ 21,320 $ 58 $ — $ 21,378 (1) Gross unrealized gain (loss) is pre-tax and is reported in other comprehensive loss. Amortized Cost Gross Unrealized Gain (1) Gross Unrealized Loss (1) Fair Value As of December 31, 2019 (in thousands) Cash equivalents US government money market fund $ 4,106 $ — $ — $ 4,106 US government agency bonds 1,511 — — 1,511 US treasury bills 1,499 — — 1,499 Total $ 7,116 $ — $ — $ 7,116 Investments in marketable securities US government agency bonds $ 19,863 $ 2 $ (1) $ 19,864 US treasury bills 15,926 2 (1) 15,927 US government bonds 23,246 — (2) 23,244 Total $ 59,035 $ 4 $ (4) $ 59,035 (1) Gross unrealized gain (loss) is pre-tax and is reported in other comprehensive loss. |
Accounts payable and accrued _2
Accounts payable and accrued liabilities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Payables and Accruals [Abstract] | |
Schedule of accounts payable and accrued liabilities | Accounts payable and accrued liabilities are comprised of the following: September 30, 2020 December 31, 2019 (in thousands) Trade accounts payable $ 852 $ 2,398 Research and development accruals 2,719 1,433 Professional fee accruals 447 809 Payroll accruals 2,844 2,314 Site consolidation accrual — 137 Other accrued liabilities 51 144 Total accounts payable and accrued liabilities $ 6,913 $ 7,235 |
Sale of future royalties (Table
Sale of future royalties (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of activity related to the net liability from inception of the Agreement | The table below shows the activity related to the net liability for 2020: Nine Months Ended September 30, 2020 (in thousands) Net liability related to sale of future royalties - beginning balance $ 18,992 Non-cash royalty revenue (2,041) Non-cash interest expense 3,166 Net liability related to sale of future royalties - ending balance $ 20,117 |
Collaborations, contracts and_2
Collaborations, contracts and licensing agreements (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Summary of collaborations | Revenues are summarized in the following table: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands) (in thousands) Revenue from collaborations and licenses Acuitas Therapeutics, Inc. $ 774 $ 516 $ 2,288 $ 1,161 Gritstone Oncology, Inc. — 1,722 — 1,789 Other milestone and royalty payments 54 362 199 464 Non-cash royalty revenue Alnylam Pharmaceuticals, Inc. 695 461 2,041 979 Total revenue $ 1,523 $ 3,061 $ 4,528 4,393 |
Stockholders_ equity (Tables)
Stockholders’ equity (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Stockholders' Equity Note [Abstract] | |
Schedule of stock based compensation expense | The table below summarizes information about the Company’s stock based compensation for the three and nine months ended September 30, 2020 and 2019 and the expense recognized in the condensed consolidated statements of operations: Three Months Ended September 30, 2020 Three Months Ended September 30, 2019 Nine Months Ended September 30, 2020 Nine Months Ended September 30, 2019 (in thousands, except share and per share data) Options granted during period 188,600 242,400 2,856,150 3,018,000 Weighted average exercise price $ 2.25 $ 1.57 $ 3.21 $ 3.41 Research and development $ 808 $ 817 $ 2,341 $ 2,361 General and administrative 880 699 2,389 4,461 Total stock compensation expense $ 1,688 $ 1,516 $ 4,730 $ 6,822 |
Significant accounting polici_3
Significant accounting policies (Details) shares in Millions | 9 Months Ended | |
Sep. 30, 2020numberOfSegmentssubsidiaryshares | Sep. 30, 2019shares | |
Accounting Policies [Abstract] | ||
Number of wholly-owed subsidiaries | subsidiary | 2 | |
Anti-dilutive common shares excluded from calculation of loss per common share (in shares) | shares | 31.6 | 28.2 |
Number of segments | numberOfSegments | 1 |
Fair value of financial instr_3
Fair value of financial instruments - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | ||||
Fair value of contingent consideration | $ 3,301 | $ 3,005 | $ 2,953 | $ 3,126 |
Increase (decrease) in fair value of contingent consideration | $ 348 | $ (121) |
Fair value of financial instr_4
Fair value of financial instruments - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Liabilities | ||||
Contingent consideration | $ 3,301 | $ 2,953 | $ 3,005 | $ 3,126 |
Recurring | ||||
Assets | ||||
Cash and cash equivalents | 96,918 | 31,799 | ||
Short-term investments | 21,378 | 59,035 | ||
Total | 118,296 | 90,834 | ||
Liabilities | ||||
Liability-classified options | 317 | 253 | ||
Contingent consideration | 3,301 | 2,953 | ||
Total | 3,618 | 3,206 | ||
Recurring | Level 1 | ||||
Assets | ||||
Cash and cash equivalents | 96,918 | 31,799 | ||
Short-term investments | 21,378 | 59,035 | ||
Total | 118,296 | 90,834 | ||
Liabilities | ||||
Liability-classified options | 0 | 0 | ||
Contingent consideration | 0 | 0 | ||
Total | 0 | 0 | ||
Recurring | Level 2 | ||||
Assets | ||||
Cash and cash equivalents | 0 | 0 | ||
Short-term investments | 0 | 0 | ||
Total | 0 | 0 | ||
Liabilities | ||||
Liability-classified options | 0 | 0 | ||
Contingent consideration | 0 | 0 | ||
Total | 0 | 0 | ||
Recurring | Level 3 | ||||
Assets | ||||
Cash and cash equivalents | 0 | 0 | ||
Short-term investments | 0 | 0 | ||
Total | 0 | 0 | ||
Liabilities | ||||
Liability-classified options | 317 | 253 | ||
Contingent consideration | 3,301 | 2,953 | ||
Total | $ 3,618 | $ 3,206 |
Fair value of financial instr_5
Fair value of financial instruments - Changes in Fair Value of Liabilities-Classified as Stock Option (Details) - Liability classified stock options - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value, Liabilities Measured on Recurring Basis [Roll Forward] | ||
Liability at beginning of the period | $ 253 | $ 479 |
Fair value of liability-classified options exercised in the period | 0 | 0 |
Increase (decrease) in fair value of liability | 64 | (393) |
Liability at end of the period | $ 317 | $ 86 |
Fair value of financial instr_6
Fair value of financial instruments - Changes in Fair Value of Contingent Consideration (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value, Liabilities Measured on Recurring Basis [Roll Forward] | ||
Liability at beginning of the period | $ 2,953 | $ 3,126 |
Increase (decrease) in fair value of liability | 348 | (121) |
Liability at end of the period | $ 3,301 | $ 3,005 |
Investments in marketable sec_3
Investments in marketable securities- Marketable Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | $ 21,400 | $ 59,000 |
Cash equivalents | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 65,327 | 7,116 |
Gross Unrealized Gain | 0 | 0 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | 65,327 | 7,116 |
Cash equivalents | US government money market fund | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 65,327 | 4,106 |
Gross Unrealized Gain | 0 | 0 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | 65,327 | 4,106 |
Cash equivalents | US government agency bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,511 | |
Gross Unrealized Gain | 0 | |
Gross Unrealized Loss | 0 | |
Fair Value | 1,511 | |
Cash equivalents | US treasury bills | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,499 | |
Gross Unrealized Gain | 0 | |
Gross Unrealized Loss | 0 | |
Fair Value | 1,499 | |
Investments in marketable securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 21,320 | 59,035 |
Gross Unrealized Gain | 58 | 4 |
Gross Unrealized Loss | 0 | (4) |
Fair Value | 21,378 | 59,035 |
Investments in marketable securities | US government agency bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 11,300 | 19,863 |
Gross Unrealized Gain | 26 | 2 |
Gross Unrealized Loss | 0 | (1) |
Fair Value | 11,326 | 19,864 |
Investments in marketable securities | US treasury bills | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 15,926 | |
Gross Unrealized Gain | 2 | |
Gross Unrealized Loss | (1) | |
Fair Value | 15,927 | |
Investments in marketable securities | US government bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 10,020 | 23,246 |
Gross Unrealized Gain | 32 | 0 |
Gross Unrealized Loss | 0 | (2) |
Fair Value | $ 10,052 | $ 23,244 |
Investments in marketable sec_4
Investments in marketable securities - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Marketable Securities [Line Items] | |||||
Investments in marketable securities, current | $ 21,400,000 | $ 21,400,000 | $ 59,000,000 | ||
Investments in marketable securities | |||||
Marketable Securities [Line Items] | |||||
Investments in marketable securities, current | 21,378,000 | 21,378,000 | $ 59,035,000 | ||
Realized gains or losses | $ 0 | $ 0 | $ 0 | $ 0 |
Investment in Genevant (Details
Investment in Genevant (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Jul. 31, 2020 | |
Schedule of Equity Method Investments [Line Items] | |||||
Investment | $ 2,500,000 | ||||
Equity investment loss | $ (2,545,000) | $ (3,512,000) | $ (2,545,000) | $ (11,497,000) | |
Equity investment | 0 | $ 0 | |||
Genevant | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Investment | $ 2,500,000 | ||||
Equity investment loss | $ 2,500,000 | ||||
Ownership interest in equity method investment (as a percentage) | 16.00% | 16.00% | 16.00% |
Accounts payable and accrued _3
Accounts payable and accrued liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||
Trade accounts payable | $ 852 | $ 2,398 |
Research and development accruals | 2,719 | 1,433 |
Professional fee accruals | 447 | 809 |
Payroll accruals | 2,844 | 2,314 |
Site consolidation accrual | 0 | 137 |
Other accrued liabilities | 51 | 144 |
Total accounts payable and accrued liabilities | $ 6,913 | $ 7,235 |
Sale of future royalties - Narr
Sale of future royalties - Narrative (Details) - USD ($) | Jul. 02, 2019 | Jan. 01, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 |
Other Liabilities Disclosure [Line Items] | |||||||
Royalty guarantees commitments percentage | 2.50% | ||||||
Non-cash royalty revenue | $ 2,041,000 | $ 979,000 | |||||
Non-cash interest expense | $ 3,166,000 | ||||||
OMERS | |||||||
Other Liabilities Disclosure [Line Items] | |||||||
Annual royalty revenue | $ 500,000,000 | ||||||
Gross proceeds from sale of royalty interest. before advisory fees | $ 20,000,000 | ||||||
Entitlement of royalties to be received | $ 30,000,000 | ||||||
Royalty guarantees commitments percentage | 100.00% | ||||||
Future royalty payments | $ 30,000,000 | ||||||
Transaction costs on sale of royalties | $ 1,500,000 | ||||||
Effective annual interest rate on royalty liability | 22.00% | ||||||
Non-cash royalty revenue | $ (700,000) | $ 500,000 | $ 2,000,000 | 1,000,000 | $ 3,700,000 | ||
Non-cash interest expense | $ 1,100,000 | $ 1,100,000 | $ 3,200,000 | $ 1,100,000 | |||
OMERS | Minimum | |||||||
Other Liabilities Disclosure [Line Items] | |||||||
Royalty, interest sold, percentage | 1.00% | ||||||
OMERS | Maximum | |||||||
Other Liabilities Disclosure [Line Items] | |||||||
Royalty, interest sold, percentage | 2.33% |
Sale of future royalties - Liab
Sale of future royalties - Liability Activity (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Liability Related To Sale Of Future Royalties [Roll Forward] | |
Net liability related to sale of future royalties - beginning balance | $ 18,992 |
Non-cash royalty revenue | (2,041) |
Non-cash interest expense | 3,166 |
Net liability related to sale of future royalties - ending balance | $ 20,117 |
Contingencies and commitments (
Contingencies and commitments (Details) $ in Millions | 1 Months Ended | 9 Months Ended | 53 Months Ended | ||||||||||
Sep. 30, 2019USD ($) | Aug. 31, 2019USD ($) | Jun. 30, 2017USD ($)Legal_proceedings | Jan. 31, 2015USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2020CAD ($) | Sep. 30, 2019USD ($) | Mar. 31, 2004USD ($) | Mar. 31, 2004CAD ($) | Sep. 30, 2020CAD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Oct. 31, 2014USD ($)product | |
Contingencies and Commitments [Line Items] | |||||||||||||
Percent of costs funded by TPC | 27.00% | 27.00% | |||||||||||
Maximum contribution for product | $ 7,200,000 | $ 9.3 | |||||||||||
Cumulative contribution for product | $ 2,700,000 | $ 3.7 | |||||||||||
Royalty guarantees commitments percentage | 2.50% | 2.50% | |||||||||||
Estimate of potential arbitration award for costs and attorney's fees | $ 400,000 | ||||||||||||
Fair value of contingent consideration | $ 3,005,000 | 3,301,000 | $ 3,005,000 | $ 2,953,000 | $ 3,126,000 | ||||||||
Recurring | |||||||||||||
Contingencies and Commitments [Line Items] | |||||||||||||
Fair value of contingent consideration | 3,301,000 | $ 2,953,000 | |||||||||||
Arbutus Inc. | Enantigen | |||||||||||||
Contingencies and Commitments [Line Items] | |||||||||||||
Business combination, high end of payment upon achievement of certain triggering events | $ 21,000,000 | ||||||||||||
Number of products covered by patent acquired under the agreement | product | 2 | ||||||||||||
Arbitration with the University of British Columbia | |||||||||||||
Contingencies and Commitments [Line Items] | |||||||||||||
Loss contingency, damages sought for allegedly unpaid royalties | $ 10,900,000 | $ 3,500,000 | |||||||||||
Number of legal proceedings | Legal_proceedings | 3 | ||||||||||||
Arbitration settlement, amount awarded to other party | $ 5,900,000 | ||||||||||||
Arbitration settlement interest | $ 2,600,000 | ||||||||||||
Arbitration settlement payment | $ 5,900,000 | ||||||||||||
Blumberg and Drexel | Enantigen | Recurring | |||||||||||||
Contingencies and Commitments [Line Items] | |||||||||||||
Fair value of contingent consideration | 3,300,000 | $ 0 | |||||||||||
Blumberg and Drexel | Arbutus Inc. | |||||||||||||
Contingencies and Commitments [Line Items] | |||||||||||||
Development and regulatory milestones payment per licensed compound series, maximum | 102,500,000 | ||||||||||||
Development and regulatory milestones payment per royalty, maximum | $ 1,000,000 | ||||||||||||
Royalty | |||||||||||||
Contingencies and Commitments [Line Items] | |||||||||||||
Royalties paid or accrued | 100,000 | ||||||||||||
Contractual obligation | 2,700,000 | $ 3.7 | |||||||||||
Royalty | Acrotech Biopharma | |||||||||||||
Contingencies and Commitments [Line Items] | |||||||||||||
Royalties earned | $ 200,000 | $ 200,000 |
Collaborations, contracts and_3
Collaborations, contracts and licensing agreements (Details) - USD ($) | Jul. 02, 2019 | Jan. 01, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Royalty guarantees commitments percentage | 2.50% | |||||
Revenue | $ 1,523,000 | $ 3,061,000 | $ 4,528,000 | $ 4,393,000 | ||
Assembly Biosciences, Inc. | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Costs related to collaboration | 0 | |||||
OMERS | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Annual royalty revenue | $ 500,000,000 | |||||
Gross proceeds from sale of royalty interest. before advisory fees | $ 20,000,000 | |||||
Entitlement of royalties to be received | $ 30,000,000 | |||||
Royalty guarantees commitments percentage | 100.00% | |||||
Future royalty payments | $ 30,000,000 | |||||
OMERS | Minimum | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Royalty, interest sold, percentage | 1.00% | |||||
OMERS | Maximum | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Royalty, interest sold, percentage | 2.33% | |||||
Revenue from collaborations and licenses | Acuitas Therapeutics, Inc. | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Revenue | 774,000 | 516,000 | 2,288,000 | 1,161,000 | ||
Revenue from collaborations and licenses | Gritstone Oncology, Inc. | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Revenue | 0 | 1,722,000 | 0 | 1,789,000 | ||
Revenue from collaborations and licenses | Other milestone and royalty payments | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Revenue | 54,000 | 362,000 | 199,000 | 464,000 | ||
Non-cash royalty revenue | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Revenue | 696,000 | 461,000 | 2,041,000 | 979,000 | ||
Non-cash royalty revenue | Alnylam Pharmaceuticals, Inc. | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Revenue | $ 695,000 | $ 461,000 | $ 2,041,000 | $ 979,000 |
Stockholders_ equity - Narrativ
Stockholders’ equity - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Aug. 31, 2020 | May 28, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Class of Stock [Line Items] | ||||||||||||||
Proceeds from issuance of shares under the agreement | $ 66,120,000 | $ 4,725,000 | ||||||||||||
Stock option awards expense | $ 300,000 | $ 300,000 | ||||||||||||
Number of shares reserved for issuance | 1,500,000 | 1,500,000 | 1,500,000 | |||||||||||
Common shares, discount rate | $ 0.15 | |||||||||||||
Stock-based compensation related to ESPP | $ 100,000 | $ 100,000 | ||||||||||||
Issuance of common shares pursuant to the agreement | $ 48,760,000 | $ 5,045,000 | $ 12,315,000 | $ 2,477,000 | $ 2,248,000 | |||||||||
Preferred Shares | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Shares issued (in shares) | 1,164,000 | |||||||||||||
Roivant Sciences Ltd | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Ownership percentage by noncontrolling owners after conversion | 36.00% | 36.00% | ||||||||||||
Maximum ownership percentage by noncontrolling owners | 49.99% | |||||||||||||
Proceeds from sale of stock | $ 66,400,000 | $ 50,000,000 | ||||||||||||
Roivant Sciences Ltd | Convertible Preferred Stock | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Issuance of common shares pursuant to the agreement | $ 116,400,000 | |||||||||||||
Preferred stock dividend rate as a percent | 8.75% | 8.75% | ||||||||||||
Preferred stated value (in dollars per share) | $ 7.13 | |||||||||||||
Number of common shares to be issued upon conversion of convertible preferred stock | 23,000,000 | |||||||||||||
Investment commitment period | 4 years | |||||||||||||
Open Market Sale Agreement | Jefferies LLC | Common Shares | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Aggregate sale price of common shares under agreement | $ 62,300,000 | $ 62,300,000 | $ 75,000,000 | $ 50,000,000 | $ 50,000,000 | |||||||||
Number of shares issued under agreement (in sales) | 13,258,096 | 0 | 19,696,361 | 1,208,090 | ||||||||||
Proceeds from issuance of shares under the agreement | $ 48,800,000 | $ 66,100,000 | $ 5,200,000 |
Stockholders_ equity - Stock-ba
Stockholders’ equity - Stock-based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average exercise price (in USD per share) | $ 2.25 | $ 1.57 | $ 3.21 | $ 3.41 |
Allocated share-based compensation expense | $ 1,688 | $ 1,516 | $ 4,730 | $ 6,822 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Allocated share-based compensation expense | 808 | 817 | 2,341 | 2,361 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Allocated share-based compensation expense | $ 880 | $ 699 | $ 2,389 | $ 4,461 |
Arbutus Plans | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options granted during period (in shares) | 188,600 | 242,400 | 2,856,150 | 3,018,000 |
Related Party Transactions (Det
Related Party Transactions (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($)ft² | Jul. 31, 2020USD ($) | |
Related Party Transaction [Line Items] | ||||||
Investment | $ 2,500,000 | |||||
Genevant Sciences Corporation | ||||||
Related Party Transaction [Line Items] | ||||||
Investment | $ 2,500,000 | |||||
Ownership interest in equity method investment (as a percentage) | 16.00% | 16.00% | 16.00% | |||
Genevant Sciences Corporation | Equity Method Investee | Research and development services | ||||||
Related Party Transaction [Line Items] | ||||||
Expenses from transactions with related party | $ 0 | $ 100,000 | ||||
Genevant Sciences Corporation | Equity Method Investee | Administrative and transitional services | ||||||
Related Party Transaction [Line Items] | ||||||
Expenses from transactions with related party | $ 35,000 | $ 35,000 | ||||
Income from related party | $ 40,000 | $ 284,000 | ||||
Genevant Sciences Corporation | Equity Method Investee | Sublease, Burnaby facility | ||||||
Related Party Transaction [Line Items] | ||||||
Sublease income | $ 21,000 | $ 145,000 | ||||
Area of sublease facility | ft² | 17,900 |