Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | Apr. 29, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | OTIC | |
Entity Registrant Name | Otonomy, Inc. | |
Entity Central Index Key | 1,493,566 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 30,113,882 |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 244,285 | $ 158,664 |
Short-term investments | 21,730 | 26,172 |
Accounts receivable, net | 146 | 0 |
Inventory | 614 | 0 |
Prepaid and other current assets | 3,960 | 3,319 |
Total current assets | 270,735 | 188,155 |
Restricted cash | 696 | 695 |
Property and equipment, net | 3,211 | 3,094 |
Other long-term assets | 820 | 1,086 |
Total assets | 275,462 | 193,030 |
Current liabilities: | ||
Accounts payable | 2,377 | 3,450 |
Accrued expenses | 4,581 | 4,551 |
Accrued compensation | 2,773 | 3,189 |
Deferred product sales, net | 129 | 0 |
Current portion of deferred rent | 111 | 101 |
Total current liabilities | 9,971 | 11,291 |
Deferred rent, net of current portion | 239 | 205 |
Total liabilities | $ 10,210 | $ 11,496 |
Commitments and Contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value, 10,000,000 shares authorized at March 31, 2016 and December 31, 2015; no shares issued or outstanding at March 31, 2016 and December 31, 2015 | $ 0 | $ 0 |
Common stock, $0.001 par value; 200,000,000 shares authorized at March 31, 2016 and December 31, 2015; 30,113,882 and 24,330,402 shares issued and outstanding at March 31, 2016 and December 31, 2015, respectively | 30 | 24 |
Additional paid-in capital | 456,122 | 345,647 |
Accumulated deficit | (190,900) | (164,137) |
Total stockholders' equity | 265,252 | 181,534 |
Total liabilities and stockholders' equity | $ 275,462 | $ 193,030 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares Issued | 30,113,882 | 24,330,402 |
Common stock, Shares outstanding | 30,113,882 | 24,330,402 |
Condensed Statements of Operati
Condensed Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Statement [Abstract] | ||
Product sales, net | $ 13 | $ 0 |
Operating expenses: | ||
Cost of product sales | 9 | 0 |
Research and development | 13,872 | 8,607 |
Selling, general and administrative | 12,995 | 3,501 |
Total operating expenses | 26,876 | 12,108 |
Loss from operations | (26,863) | (12,108) |
Other income : | ||
Interest income | 101 | 92 |
Other expense | (1) | (1) |
Total other income | 100 | 91 |
Net loss and comprehensive loss | $ (26,763) | $ (12,017) |
Net loss per share, basic and diluted | $ (0.91) | $ (0.52) |
Weighted-average shares used to compute net loss per share, basic and diluted | 29,328,804 | 23,196,011 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (26,763) | $ (12,017) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 152 | 60 |
Stock-based compensation | 2,736 | 1,343 |
Amortization of discount or premium on short-term investments | 45 | 7 |
Deferred rent | 44 | (19) |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (146) | 0 |
Inventory | (614) | 0 |
Prepaid and other assets | (375) | (2,923) |
Accounts payable | (1,106) | (57) |
Accrued expenses | (178) | 643 |
Accrued compensation | (416) | 587 |
Deferred product sales, net | 129 | 0 |
Net cash used in operating activities | (26,492) | (12,376) |
Cash flows from investing activities: | ||
Purchases of short-term investments | (4,771) | (7,833) |
Maturities of short-term investments | 9,168 | 1,489 |
Purchases of property and equipment | (28) | (126) |
Increase in restricted cash | (1) | 0 |
Net cash provided by (used in) investing activities | 4,368 | (6,470) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock, net of transaction costs | 107,609 | 80,013 |
Proceeds from exercise of stock options, net of early exercise liability | 136 | 50 |
Net cash provided by financing activities | 107,745 | 80,078 |
Net change in cash | 85,621 | 61,232 |
Cash and cash equivalents at beginning of period | 158,664 | 139,810 |
Cash and cash equivalents at end of period | 244,285 | 201,042 |
Supplemental disclosure of non-cash investing activities: | ||
Purchase of property and equipment in accounts payable and accrued expenses | 241 | 294 |
Common Stock Warrants [Member] | ||
Cash flows from financing activities: | ||
Proceeds from exercise of stock warrants | $ 0 | $ 15 |
Description of Business and Bas
Description of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Description of Business and Basis of Presentation | 1. Description of Business and Basis of Presentation Description of Business Otonomy, Inc. (the Company) was incorporated in the state of Delaware on May 6, 2008. The Company is a biopharmaceutical company focused on the development and commercialization of innovative therapeutics for diseases and disorders of the ear. OTIPRIO™ (ciprofloxacin otic suspension) is the first drug approved in the United States for use during tympanostomy tube placement (TTP) surgery in pediatric patients, and commercial launch commenced in March 2016. OTIPRIO is also being evaluated for potential label expansion in acute otitis externa (also known as “swimmer’s ear”) and acute otitis media with tympanostomy tubes (AOMT). OTO-104 is a steroid in development for the treatment of Ménière’s disease and other balance and hearing disorders. Two Phase 3 trials in Ménière’s disease patients are underway: AVERTS-1 in the United States and AVERTS-2 in the European Union. OTO-311 is an NMDA receptor antagonist for the treatment of tinnitus that is currently in a Phase 1 clinical safety trial. A fourth program targeting sensorineural hearing loss including age-related hearing loss is in preclinical development. OTIPRIO and the Company’s current product candidates utilize the Company’s proprietary formulation technology that combines a thermosensitive gel with drug microparticles to enable a single dose treatment by a physician. In January 2016, the Company completed a public offering of 5,750,000 shares of its common stock, which includes the exercise in full by the underwriters of their option to purchase 750,000 shares of common stock, at an offering price of $20.00 per share. Proceeds from the public offering were approximately $107.6 million, net of underwriting discounts, commissions and offering-related transaction costs. Basis of Presentation The accompanying condensed financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred operating losses and negative cash flows from operating activities since inception. As of March 31, 2016, the Company had cash, cash equivalents and short-term investments of $266.0 million and an accumulated deficit of $190.9 million. The Company anticipates that it will continue to incur net losses into the foreseeable future as it: (i) commercializes OTIPRIO and continues its development for additional indications; (ii) develops and seeks regulatory approvals for its product candidates OTO-104 and OTO-311; and (iii) works to develop additional product candidates through research and development programs. If additional financing is required, the Company anticipates that it will seek additional funding through future debt and/or equity financings or other sources, such as potential collaboration agreements. If the Company is not able to secure adequate additional funding, if or when necessary, the Company may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, and/or suspend or curtail planned programs. Any of these actions could materially harm the Company’s business, results of operations, and future prospects. Unaudited Interim Financial Information The accompanying interim condensed financial statements are unaudited. These unaudited interim condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and following the requirements of the United States Securities and Exchange Commission (SEC) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by GAAP can be condensed or omitted. In management’s opinion, the unaudited interim condensed financial statements have been prepared on the same basis as the audited financial statements and include all adjustments, which include only normal recurring adjustments necessary for the fair presentation of the Company’s financial position, results of operations and cash flows for the periods presented. These statements do not include all disclosures required by GAAP and should be read in conjunction with the Company’s audited financial statements and accompanying notes for the year ended December 31, 2015 included in the Company’s Form 10-K, as filed with the SEC on March 7, 2016. The results presented in these unaudited condensed financial statements are not necessarily indicative of the results expected for the full fiscal year or any other interim period or any future year or period. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of product sales and expense during the reporting period. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may ultimately materially differ from these estimates and assumptions. Segment Reporting Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business in one operating segment. Concentrations of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents and short-term investments. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash balances due to the financial position of the depository institutions in which those deposits are held. Additionally, the Company established guidelines regarding approved investments and maturities of investments, which are designed to maintain safety and liquidity. Cash and Cash Equivalents Cash and cash equivalents consist of cash and highly liquid investments with original maturities of three months or less at the date of purchase. The carrying amounts approximate fair value due to the short maturities of these instruments. Cash and cash equivalents include cash in readily available checking, savings and money market accounts, as well as certificates of deposit. Short-Term Investments The Company carries short-term investments classified as available-for-sale at fair value as determined by prices for identical or similar securities at the balance sheet date. Short-term investments consist of both Level 1 and Level 2 financial instruments in the fair value hierarchy (see Note 6). Realized gains or losses of available-for-sale securities are determined using the specific identification method and net realized gains and losses are included in interest income. The Company periodically reviews available-for-sale securities for other-than temporary declines in fair value below the cost basis, and whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Fair Value of Financial Instruments The carrying value of the Company’s cash and cash equivalents, short-term investments, prepaid expenses and other current assets, other assets, accounts payable, accrued liabilities, and accrued compensation approximate fair value due to the short-term nature of these items. Restricted Cash The Company’s restricted cash consists of cash maintained in a separate deposit account to secure a letter of credit issued by a bank to the landlord under a lease agreement for construction of the Company’s new corporate headquarters (see Note 5). The Company has classified the restricted cash as noncurrent on the condensed balance sheet. Inventory Inventory, which is stated at the lower of cost or market, is based on actual cost in a manner that approximates the first-in, first-out method. Inventories consist of OTIPRIO finished goods and raw materials used in the manufacture of OTIPRIO. If inventory costs exceed expected market value due to obsolescence, expiry or quantities in excess of expected demand, reserves are recorded for the difference between cost and market value, less cost to sell. There are no such reserves as of March 31, 2016. Property and Equipment Property and equipment generally consist of manufacturing equipment, furniture and fixtures, computers, and scientific and office equipment and are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the assets (generally two to ten years). Leasehold improvements are stated at cost and are depreciated on a straight-line basis over the lesser of the remaining term of the related lease or the estimated useful lives of the assets. Repairs and maintenance costs are charged to expense as incurred. Impairment of Long-Lived Assets The Company assesses the value of its long-lived assets, which consist of property and equipment, for impairment on an annual basis and whenever events or changes in circumstances and the undiscounted cash flows generated by those assets indicate that the carrying amount of such assets may not be recoverable. While the Company’s current and historical operating losses and negative cash flows are indicators of impairment, management believes that future cash flows to be received support the carrying value of its long-lived assets. The Company had no impairments or disposals during the three months ended March 31, 2016 and 2015. Clinical Trial Expense Accruals As part of the process of preparing the Company’s financial statements, the Company is required to estimate expenses resulting from the Company’s obligations under contracts with vendors, clinical research organizations and consultants and under clinical site agreements in connection with conducting clinical trials. The financial terms of these contracts are subject to negotiations, which vary from contract to contract and may result in payment flows that do not match the periods over which materials or services are provided under such contracts. The Company’s objective is to reflect the appropriate clinical trial expenses in its financial statements by recording those expenses in the period in which services are performed and efforts are expended. The Company accounts for these expenses according to the progress of the trial as measured by patient progression and the timing of various aspects of the trial. The Company determines accrual estimates through financial models taking into account discussion with applicable personnel and outside service providers as to the progress or state of its trials. During the course of a clinical trial, the Company adjusts its clinical expense if actual results differ from its estimates. Revenue Recognition The Company recognizes revenue when all of the following four criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the fee is fixed or determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management’s judgments regarding the nature of the fee charged for products delivered and the collectability of those fees. If the revenue recognition criteria are not met, the Company defers the recognition of revenue by recording deferred revenue until such time that all criteria are met. The Company began selling OTIPRIO during March 2016. The Company sells OTIPRIO to a limited number of specialty wholesale distributors, and title and risk of loss transfer upon receipt by these distributors. Hospitals and ambulatory surgery centers order OTIPRIO from these distributors, and are the end users of OTIPRIO. The Company permits product returns from the distributors only if the product is damaged or is shipped or ordered in error. Product returns based on expiry are not permitted. Product sales are recorded net of estimated chargebacks, government rebates and distributor fees. During the initial launch period, the Company defers the recognition of revenue and the related cost of product sales until the product is sold to the end users, due to the inherent uncertainties in estimating normal channel inventory at the distributors, and during which period the Company also provided extended payment terms to the distributors. Deferred product sales related to OTIPRIO are recorded as a liability in the condensed balance sheet and deferred cost of product sales related to OTIPRIO are recorded as a component of inventory in the condensed balance sheet. The Company establishes reserves for chargebacks, government rebates and distributor fees utilizing a variety of information including the Company’s historical and projected payer mix, industry data, sell-through and inventory on-hand information received directly from the Company’s distributors and changes in the overall marketplace. Reserves are established for these discounts and allowances upon receipt of OTIPRIO by the distributor and are classified as: (i) an allowance against accounts receivable if the amount is payable to the distributor or (ii) an accrued liability if the amount is payable to a party other than the distributor. Allowances against accounts receivable relate to chargebacks and distributor fees and accruals relate primarily to government rebates. Such reserves result in a reduction to revenue. Chargebacks. Government Rebates. Distributor Fees. Research and Development Research and development expenses include the costs associated with the Company’s research and development activities, including salaries, benefits and occupancy costs. Also included in research and development expenses are third-party costs incurred in conjunction with contract manufacturing for the Company’s research and development programs and clinical trials, including the cost of clinical trial drug supply, costs incurred by contract research organizations and regulatory expenses. Research and development costs are expensed as incurred. Patent Expenses The Company expenses all costs as incurred in connection with patent applications (including direct application fees, and the legal and consulting expenses related to making such applications) and such costs are included in selling, general and administrative expenses in the accompanying condensed statements of operations. Stock-Based Compensation The Company accounts for stock-based compensation expense related to employee stock options and employee stock purchase plan (ESPP) rights by estimating the fair value on the date of grant using the Black-Scholes-Merton option pricing model net of estimated forfeitures. For awards subject to time-based vesting conditions, stock-based compensation expense is recognized using the straight-line method. Income Taxes The accounting guidance for uncertainty in income taxes prescribes a recognition threshold and measurement attribute criteria for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities based on the technical merits of the position. The Company uses the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and the tax reporting basis of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The Company provides a valuation allowance against net deferred tax assets unless, based upon the available evidence, it is more likely than not that the deferred tax assets will be realized. When the Company establishes or reduces the valuation allowance against its deferred tax assets, its provision for income taxes will increase or decrease, respectively, in the period such determination is made. Comprehensive Loss Comprehensive loss is defined as the change in equity during a period from transactions and other events and/or circumstances from non-owner sources. For all periods presented, comprehensive loss is equal to net loss. Net Loss Per Share Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares and potentially dilutive securities outstanding for the period determined using the treasury-stock and if-converted methods. For purposes of the diluted net loss per share calculation, potentially dilutive securities are excluded from the calculation of diluted net loss per share because their effect would be anti-dilutive and therefore, basic and diluted net loss per share were the same for all periods presented. Potentially dilutive securities excluded from the calculation of diluted net loss per share are as follows: Three Months Ended March 31, 2016 2015 Warrants to purchase common stock 141,060 141,060 Unvested restricted common stock subject to repurchase 297 10,961 Options to purchase common stock 4,661,812 2,760,917 4,803,169 2,912,938 Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09, “Revenue from Contracts with Customers” (ASU 2014-09). ASU 2014-09 supersedes nearly all existing revenue recognition guidance under U.S. GAAP and requires revenue to be recognized when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. Additionally, qualitative and quantitative disclosures are required about customer contracts, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. ASU 2014-09 is effective for the Company beginning in the first quarter of 2018 using one of two prescribed transition methods. The Company is currently evaluating the effect that the updated standard and transition method will have on its financial statements and related disclosures. In August 2014, the FASB issued Accounting Standards Update No. 2014-15, “Presentation of Financial Statements—Going Concern” (ASU 2014-15). ASU 2014-15 requires management to assess an entity’s ability to continue as a going concern and to provide related footnote disclosure in certain circumstances. ASU 2014-15 is effective for annual reporting periods ending after December 15, 2016 and interim periods thereafter. Early application is permitted. The adoption of this updated standard will have no impact on the Company’s financial statements and related disclosures. In February 2016, the FASB issued ASU 2016-02, “Leases” (ASU 2016-02). ASU 2016-02 will require lessees to recognize most leases on their balance sheets and makes selected changes to lessor accounting. ASU 2016-02 is effective for annual and interim reporting periods beginning after December 15, 2018. A modified retrospective transition approach is required, with certain practical expedients available. The Company is currently evaluating the impact the adoption of this updated standard will have on its financial statements and related disclosures. In March 2016, the FASB issued ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting” (ASU 2016-09). ASU 2016-09 will revise accounting for share-based compensation arrangements, including the income tax impact and classification on the statement of cash flows. ASU 2016-09 is effective for annual and interim periods beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this updated standard will have on its financial statements and related disclosures. |
Available-for-Sale Securities
Available-for-Sale Securities | 3 Months Ended |
Mar. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Available-for-Sale Securities | 3. Available-for-Sale Securities The Company invests in available-for-sale securities consisting of money market funds and certificates of deposit. Available-for-sale securities are classified as part of either cash and cash equivalents or short-term investments in the condensed balance sheets. Available-for-sale securities with maturities of three months or less from the date of purchase have been classified as cash equivalents, and were $13.4 million and $8.9 million as of March 31, 2016 and December 31, 2015, respectively. Available-for-sale securities with maturities of more than three months from the date of purchase have been classified as short-term investments, and were $21.7 million and $26.2 million as of March 31, 2016 and December 31, 2015, respectively. There have been no unrealized gains or losses related to the Company’s short-term investments. The Company determined that there were no other-than-temporary declines in the value of any available-for-sale securities as of March 31, 2016. All of the Company’s available-for-sale investment securities mature within one year. The Company obtains the fair value of its available-for-sale securities from a professional pricing service. The fair values of available-for-sale securities are validated by comparing the fair values reported by the professional pricing service to quoted market prices or to fair values obtained from the custodian bank. |
Balance Sheet Details
Balance Sheet Details | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Details | 4. Balance Sheet Details Prepaid and Other Current Assets Prepaid and other current assets are comprised of the following (in thousands): March 31, December 31, Prepaid clinical trial costs $ 2,437 $ 2,024 Other 1,523 1,295 Total $ 3,960 $ 3,319 Inventory Inventory is comprised of the following (in thousands): March 31, December 31, Raw materials $ 107 $ — Finished goods 402 — Deferred cost of product sales 105 — Total $ 614 $ — Property and Equipment, Net Property and equipment, net consists of the following (in thousands): March 31, December 31, Laboratory equipment $ 2,531 $ 2,409 Manufacturing equipment 1,432 1,330 Computer equipment and software 341 303 Leasehold improvements 123 123 Office furniture 74 61 4,501 4,226 Less: accumulated depreciation and amortization (1,290 ) (1,132 ) Total $ 3,211 $ 3,094 Accrued Expenses Accrued expenses consist of the following (in thousands): March 31, December 31, Accrued clinical trial costs $ 1,979 $ 1,763 Accrued other 2,602 2,788 Total $ 4,581 $ 4,551 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 5. Commitments and Contingencies Intellectual Property Licenses The Company has acquired exclusive rights to develop patented rights, information rights and related know-how for OTIPRIO, OTO-104 and OTO-311 and potential future product candidates under licensing agreements with third parties. The licensing rights obligate the Company to make payments to the licensors for license fees, milestones and royalties. The Company is also responsible for patent prosecution costs, in the event such costs are incurred. Under one of these agreements, the Company has achieved six development milestones and one regulatory milestone, totaling $2.8 million, related to its clinical trials for OTIPRIO, OTO-104 and OTO-311, including the $1.0 million regulatory milestone payment made in March 2015 as a result of submitting the OTIPRIO NDA to the FDA. The Company may be obligated to make additional milestone payments under these agreements as follows (in thousands): Development $ 2,100 Regulatory 10,150 Commercialization 1,000 Total $ 13,250 In addition, the Company is obligated to pay royalties of less than five percent on net sales of OTIPRIO and on sales of any other commercial products developed using these licensed technologies. Such royalty expense is recorded to cost of product sales. The Company may also be obligated to pay to the licensors a percentage of fees received if and when the Company sublicenses the technology. As of March 31, 2016, the Company has not entered into any sublicense agreements for the licensed technologies. The following table summarizes costs recognized in research and development under the Company’s intellectual property license agreements (in thousands): Three Months Ended March 31, 2016 2015 License and other fees $ 21 $ 6 Milestone fees — 1,000 Total license and related fees $ 21 $ 1,006 Other Royalty Arrangements The Company entered into an agreement related to OTIPRIO under which the Company is obligated to pay a one-time milestone payment of $0.5 million upon the first commercial sale of OTIPRIO and to pay royalties of less than one percent on net product sales of OTIPRIO. This milestone payment was paid during March 2016 and both this milestone payment and the royalties are recorded as selling, general and administrative expense. The royalties are payable until the later of: (i) the expiration of the last to expire patent owned by the Company in such country covering OTIPRIO; or (ii) 10 years after the first commercial sale of OTIPRIO after receipt of regulatory approval for OTIPRIO in such country. During October 2014, the Company entered into an exclusive license agreement with Ipsen that enables the Company to use clinical and non-clinical gacyclidine data generated by Ipsen to support worldwide development and regulatory filings for OTO-311. Under this license agreement, the Company is obligated to pay Ipsen low single-digit royalties on annual net sales of OTO-311 by the Company or its affiliates or sublicensees, up to a maximum cumulative royalty totaling $10.0 million. Leased Facility In May 2015, the Company entered into a lease agreement for a new headquarters location to be constructed in San Diego, California. The lease provides for the landlord to construct the building at its cost and to use reasonable efforts to complete the building by October 2016. The lease term will commence upon the substantial completion and delivery of the building to the Company and has an initial term of 130 months thereafter, with an option by the Company to extend the lease term for an additional five years. The Company has the right to terminate the lease at the end of the 94 th |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value | 6. Fair Value The accounting guidance defines fair value, establishes a consistency framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring basis or nonrecurring basis. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. Accounting guidance establishes a three-tier fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. These tiers are based on the source of the inputs and are as follows: Level 1: Level 2: Level 3: The Company held no liabilities measured at fair value on a recurring basis as of March 31, 2016 and December 31, 2015. The following fair value hierarchy table presents the Company’s assets measured at fair value on a recurring basis as of March 31, 2016 and December 31, 2015 (in thousands): Fair Value Measurement at Reporting Date Using Total Level 1 Level 2 Level 3 March 31, 2016: Assets Money market funds $ 13,107 $ 13,107 $ — $ — Certificates of deposit 21,990 — 21,990 — $ 35,097 $ 13,107 $ 21,990 $ — December 31, 2015: Assets Money market funds $ 8,020 $ 8,020 $ — $ — Certificates of deposit 27,083 — 27,083 — $ 35,103 $ 8,020 $ 27,083 $ — |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Equity | 7. Stockholders’ Equity Common Stock Reserved for Future Issuance Shares of common stock reserved for future issuance are as follows: March 31, December 31, Warrants for the purchase of common stock 141,060 141,060 Common stock options issued and outstanding 4,661,812 3,413,142 Common stock options available for future grant 2,066,016 2,131,646 Common stock reserved for issuance under ESPP 1,013,387 648,431 Total common stock reserved for future issuance 7,882,275 6,334,279 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | 8. Stock-Based Compensation The 2014 Plan permits the grant of incentive stock options to the Company’s employees and the grant of nonstatutory stock options, restricted stock, restricted stock units, stock appreciation rights, performance units and performance shares to the Company’s employees, directors and consultants. Options granted under the 2014 Plan generally are scheduled to vest over four years, subject to continued service, and subject to certain acceleration of vesting provisions, expire no later than 10 years from the date of grant. Options granted under the 2014 Plan must have a per share exercise price equal to at least 100% of the fair market value of a shares of the common stock as of the date of grant. The following table summarizes stock option activity for the three months ended March 31, 2016 (share amounts in thousands): Options Weighted- Outstanding as of December 31, 2015 3,413 $ 14.86 Granted 1,287 $ 14.54 Exercised (33 ) $ 3.79 Forfeited (5 ) $ 27.91 Outstanding as of March 31, 2016 4,662 $ 14.84 Total non-cash stock-based compensation expense recognized in the accompanying condensed statements of operations is as follows (in thousands): Three Months Ended March 31, 2016 2015 Research and development $ 647 $ 552 Selling, general and administrative 2,089 791 Total stock-based compensation $ 2,736 $ 1,343 |
Description of Business and B14
Description of Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred operating losses and negative cash flows from operating activities since inception. As of March 31, 2016, the Company had cash, cash equivalents and short-term investments of $266.0 million and an accumulated deficit of $190.9 million. The Company anticipates that it will continue to incur net losses into the foreseeable future as it: (i) commercializes OTIPRIO and continues its development for additional indications; (ii) develops and seeks regulatory approvals for its product candidates OTO-104 and OTO-311; and (iii) works to develop additional product candidates through research and development programs. If additional financing is required, the Company anticipates that it will seek additional funding through future debt and/or equity financings or other sources, such as potential collaboration agreements. If the Company is not able to secure adequate additional funding, if or when necessary, the Company may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, and/or suspend or curtail planned programs. Any of these actions could materially harm the Company’s business, results of operations, and future prospects. |
Unaudited Interim Financial Information | Unaudited Interim Financial Information The accompanying interim condensed financial statements are unaudited. These unaudited interim condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and following the requirements of the United States Securities and Exchange Commission (SEC) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by GAAP can be condensed or omitted. In management’s opinion, the unaudited interim condensed financial statements have been prepared on the same basis as the audited financial statements and include all adjustments, which include only normal recurring adjustments necessary for the fair presentation of the Company’s financial position, results of operations and cash flows for the periods presented. These statements do not include all disclosures required by GAAP and should be read in conjunction with the Company’s audited financial statements and accompanying notes for the year ended December 31, 2015 included in the Company’s Form 10-K, as filed with the SEC on March 7, 2016. The results presented in these unaudited condensed financial statements are not necessarily indicative of the results expected for the full fiscal year or any other interim period or any future year or period. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of product sales and expense during the reporting period. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may ultimately materially differ from these estimates and assumptions. |
Segment Reporting | Segment Reporting Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business in one operating segment. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents and short-term investments. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash balances due to the financial position of the depository institutions in which those deposits are held. Additionally, the Company established guidelines regarding approved investments and maturities of investments, which are designed to maintain safety and liquidity. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of cash and highly liquid investments with original maturities of three months or less at the date of purchase. The carrying amounts approximate fair value due to the short maturities of these instruments. Cash and cash equivalents include cash in readily available checking, savings and money market accounts, as well as certificates of deposit. |
Short-Term Investments | Short-Term Investments The Company carries short-term investments classified as available-for-sale at fair value as determined by prices for identical or similar securities at the balance sheet date. Short-term investments consist of both Level 1 and Level 2 financial instruments in the fair value hierarchy (see Note 6). Realized gains or losses of available-for-sale securities are determined using the specific identification method and net realized gains and losses are included in interest income. The Company periodically reviews available-for-sale securities for other-than temporary declines in fair value below the cost basis, and whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying value of the Company’s cash and cash equivalents, short-term investments, prepaid expenses and other current assets, other assets, accounts payable, accrued liabilities, and accrued compensation approximate fair value due to the short-term nature of these items. |
Restricted Cash | Restricted Cash The Company’s restricted cash consists of cash maintained in a separate deposit account to secure a letter of credit issued by a bank to the landlord under a lease agreement for construction of the Company’s new corporate headquarters (see Note 5). The Company has classified the restricted cash as noncurrent on the condensed balance sheet. |
Inventory | Inventory Inventory, which is stated at the lower of cost or market, is based on actual cost in a manner that approximates the first-in, first-out method. Inventories consist of OTIPRIO finished goods and raw materials used in the manufacture of OTIPRIO. If inventory costs exceed expected market value due to obsolescence, expiry or quantities in excess of expected demand, reserves are recorded for the difference between cost and market value, less cost to sell. There are no such reserves as of March 31, 2016. |
Property and Equipment | Property and Equipment Property and equipment generally consist of manufacturing equipment, furniture and fixtures, computers, and scientific and office equipment and are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the assets (generally two to ten years). Leasehold improvements are stated at cost and are depreciated on a straight-line basis over the lesser of the remaining term of the related lease or the estimated useful lives of the assets. Repairs and maintenance costs are charged to expense as incurred. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company assesses the value of its long-lived assets, which consist of property and equipment, for impairment on an annual basis and whenever events or changes in circumstances and the undiscounted cash flows generated by those assets indicate that the carrying amount of such assets may not be recoverable. While the Company’s current and historical operating losses and negative cash flows are indicators of impairment, management believes that future cash flows to be received support the carrying value of its long-lived assets. The Company had no impairments or disposals during the three months ended March 31, 2016 and 2015. |
Clinical Trial Expense Accruals | Clinical Trial Expense Accruals As part of the process of preparing the Company’s financial statements, the Company is required to estimate expenses resulting from the Company’s obligations under contracts with vendors, clinical research organizations and consultants and under clinical site agreements in connection with conducting clinical trials. The financial terms of these contracts are subject to negotiations, which vary from contract to contract and may result in payment flows that do not match the periods over which materials or services are provided under such contracts. The Company’s objective is to reflect the appropriate clinical trial expenses in its financial statements by recording those expenses in the period in which services are performed and efforts are expended. The Company accounts for these expenses according to the progress of the trial as measured by patient progression and the timing of various aspects of the trial. The Company determines accrual estimates through financial models taking into account discussion with applicable personnel and outside service providers as to the progress or state of its trials. During the course of a clinical trial, the Company adjusts its clinical expense if actual results differ from its estimates. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when all of the following four criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the fee is fixed or determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management’s judgments regarding the nature of the fee charged for products delivered and the collectability of those fees. If the revenue recognition criteria are not met, the Company defers the recognition of revenue by recording deferred revenue until such time that all criteria are met. The Company began selling OTIPRIO during March 2016. The Company sells OTIPRIO to a limited number of specialty wholesale distributors, and title and risk of loss transfer upon receipt by these distributors. Hospitals and ambulatory surgery centers order OTIPRIO from these distributors, and are the end users of OTIPRIO. The Company permits product returns from the distributors only if the product is damaged or is shipped or ordered in error. Product returns based on expiry are not permitted. Product sales are recorded net of estimated chargebacks, government rebates and distributor fees. During the initial launch period, the Company defers the recognition of revenue and the related cost of product sales until the product is sold to the end users, due to the inherent uncertainties in estimating normal channel inventory at the distributors, and during which period the Company also provided extended payment terms to the distributors. Deferred product sales related to OTIPRIO are recorded as a liability in the condensed balance sheet and deferred cost of product sales related to OTIPRIO are recorded as a component of inventory in the condensed balance sheet. The Company establishes reserves for chargebacks, government rebates and distributor fees utilizing a variety of information including the Company’s historical and projected payer mix, industry data, sell-through and inventory on-hand information received directly from the Company’s distributors and changes in the overall marketplace. Reserves are established for these discounts and allowances upon receipt of OTIPRIO by the distributor and are classified as: (i) an allowance against accounts receivable if the amount is payable to the distributor or (ii) an accrued liability if the amount is payable to a party other than the distributor. Allowances against accounts receivable relate to chargebacks and distributor fees and accruals relate primarily to government rebates. Such reserves result in a reduction to revenue. Chargebacks. Government Rebates. Distributor Fees. |
Research and Development | Research and Development Research and development expenses include the costs associated with the Company’s research and development activities, including salaries, benefits and occupancy costs. Also included in research and development expenses are third-party costs incurred in conjunction with contract manufacturing for the Company’s research and development programs and clinical trials, including the cost of clinical trial drug supply, costs incurred by contract research organizations and regulatory expenses. Research and development costs are expensed as incurred. |
Patent Expenses | Patent Expenses The Company expenses all costs as incurred in connection with patent applications (including direct application fees, and the legal and consulting expenses related to making such applications) and such costs are included in selling, general and administrative expenses in the accompanying condensed statements of operations. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation expense related to employee stock options and employee stock purchase plan (ESPP) rights by estimating the fair value on the date of grant using the Black-Scholes-Merton option pricing model net of estimated forfeitures. For awards subject to time-based vesting conditions, stock-based compensation expense is recognized using the straight-line method. |
Income Taxes | Income Taxes The accounting guidance for uncertainty in income taxes prescribes a recognition threshold and measurement attribute criteria for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities based on the technical merits of the position. The Company uses the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and the tax reporting basis of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The Company provides a valuation allowance against net deferred tax assets unless, based upon the available evidence, it is more likely than not that the deferred tax assets will be realized. When the Company establishes or reduces the valuation allowance against its deferred tax assets, its provision for income taxes will increase or decrease, respectively, in the period such determination is made. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is defined as the change in equity during a period from transactions and other events and/or circumstances from non-owner sources. For all periods presented, comprehensive loss is equal to net loss. |
Net Loss Per Share | Net Loss Per Share Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares and potentially dilutive securities outstanding for the period determined using the treasury-stock and if-converted methods. For purposes of the diluted net loss per share calculation, potentially dilutive securities are excluded from the calculation of diluted net loss per share because their effect would be anti-dilutive and therefore, basic and diluted net loss per share were the same for all periods presented. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09, “Revenue from Contracts with Customers” (ASU 2014-09). ASU 2014-09 supersedes nearly all existing revenue recognition guidance under U.S. GAAP and requires revenue to be recognized when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. Additionally, qualitative and quantitative disclosures are required about customer contracts, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. ASU 2014-09 is effective for the Company beginning in the first quarter of 2018 using one of two prescribed transition methods. The Company is currently evaluating the effect that the updated standard and transition method will have on its financial statements and related disclosures. In August 2014, the FASB issued Accounting Standards Update No. 2014-15, “Presentation of Financial Statements—Going Concern” (ASU 2014-15). ASU 2014-15 requires management to assess an entity’s ability to continue as a going concern and to provide related footnote disclosure in certain circumstances. ASU 2014-15 is effective for annual reporting periods ending after December 15, 2016 and interim periods thereafter. Early application is permitted. The adoption of this updated standard will have no impact on the Company’s financial statements and related disclosures. In February 2016, the FASB issued ASU 2016-02, “Leases” (ASU 2016-02). ASU 2016-02 will require lessees to recognize most leases on their balance sheets and makes selected changes to lessor accounting. ASU 2016-02 is effective for annual and interim reporting periods beginning after December 15, 2018. A modified retrospective transition approach is required, with certain practical expedients available. The Company is currently evaluating the impact the adoption of this updated standard will have on its financial statements and related disclosures. In March 2016, the FASB issued ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting” (ASU 2016-09). ASU 2016-09 will revise accounting for share-based compensation arrangements, including the income tax impact and classification on the statement of cash flows. ASU 2016-09 is effective for annual and interim periods beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this updated standard will have on its financial statements and related disclosures. |
Summary of Significant Accoun15
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Potentially Dilutive Securities Excluded from Calculation of Diluted Net Loss Per Share | Potentially dilutive securities excluded from the calculation of diluted net loss per share are as follows: Three Months Ended March 31, 2016 2015 Warrants to purchase common stock 141,060 141,060 Unvested restricted common stock subject to repurchase 297 10,961 Options to purchase common stock 4,661,812 2,760,917 4,803,169 2,912,938 |
Balance Sheet Details (Tables)
Balance Sheet Details (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Prepaid and Other Current Assets | Prepaid and other current assets are comprised of the following (in thousands): March 31, December 31, Prepaid clinical trial costs $ 2,437 $ 2,024 Other 1,523 1,295 Total $ 3,960 $ 3,319 |
Summary of Inventory | Inventory is comprised of the following (in thousands): March 31, December 31, Raw materials $ 107 $ — Finished goods 402 — Deferred cost of product sales 105 — Total $ 614 $ — |
Property and Equipment, Net | Property and equipment, net consists of the following (in thousands): March 31, December 31, Laboratory equipment $ 2,531 $ 2,409 Manufacturing equipment 1,432 1,330 Computer equipment and software 341 303 Leasehold improvements 123 123 Office furniture 74 61 4,501 4,226 Less: accumulated depreciation and amortization (1,290 ) (1,132 ) Total $ 3,211 $ 3,094 |
Accrued Expenses | Accrued expenses consist of the following (in thousands): March 31, December 31, Accrued clinical trial costs $ 1,979 $ 1,763 Accrued other 2,602 2,788 Total $ 4,581 $ 4,551 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Additional Milestone Payments | The Company may be obligated to make additional milestone payments under these agreements as follows (in thousands): Development $ 2,100 Regulatory 10,150 Commercialization 1,000 Total $ 13,250 |
Summary of Cost Recognized in Research and Development under Intellectual Property License Agreements | The following table summarizes costs recognized, in research and development, under the Company’s intellectual property license agreements (in thousands): Three Months Ended March 31, 2016 2015 License and other fees $ 21 $ 6 Milestone fees — 1,000 Total license and related fees $ 21 $ 1,006 |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Assets Measured on a Recurring Basis | The following fair value hierarchy table presents the Company’s assets measured at fair value on a recurring basis as of March 31, 2016 and December 31, 2015 (in thousands): Fair Value Measurement at Reporting Date Using Total Level 1 Level 2 Level 3 March 31, 2016: Assets Money market funds $ 13,107 $ 13,107 $ — $ — Certificates of deposit 21,990 — 21,990 — $ 35,097 $ 13,107 $ 21,990 $ — December 31, 2015: Assets Money market funds $ 8,020 $ 8,020 $ — $ — Certificates of deposit 27,083 — 27,083 — $ 35,103 $ 8,020 $ 27,083 $ — |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
Schedule of Shares of Common Stock Reserved for Future Issuance | Shares of common stock reserved for future issuance are as follows: March 31, December 31, Warrants for the purchase of common stock 141,060 141,060 Common stock options issued and outstanding 4,661,812 3,413,142 Common stock options available for future grant 2,066,016 2,131,646 Common stock reserved for issuance under ESPP 1,013,387 648,431 Total common stock reserved for future issuance 7,882,275 6,334,279 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Option Activity | The following table summarizes stock option activity for the three months ended March 31, 2016 (share amounts in thousands): Options Weighted- Outstanding as of December 31, 2015 3,413 $ 14.86 Granted 1,287 $ 14.54 Exercised (33 ) $ 3.79 Forfeited (5 ) $ 27.91 Outstanding as of March 31, 2016 4,662 $ 14.84 |
Summary of Non-cash Stock Based Compensation Expense | Total non-cash stock-based compensation expense recognized in the accompanying condensed statements of operations is as follows (in thousands): Three Months Ended March 31, 2016 2015 Research and development $ 647 $ 552 Selling, general and administrative 2,089 791 Total stock-based compensation $ 2,736 $ 1,343 |
Description of Business and B21
Description of Business and Basis of Presentation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | ||
Jan. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | |
Description Of Business And Basis Of Presentation [Line Items] | |||
Cash, cash equivalents and short-term investments | $ 266,000 | ||
Accumulated deficit | $ (190,900) | $ (164,137) | |
Common stock [Member] | Follow On Public Offering [Member] | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
Number of shares issued | 5,750,000 | ||
Price per share | $ 20 | ||
Proceeds from public offering | $ 107,600 | ||
Common stock [Member] | Over-Allotment Option [Member] | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
Number of shares issued | 750,000 |
Summary of Significant Accoun22
Summary of Significant Accounting Policies - Additional Information (Detail) | 3 Months Ended | |
Mar. 31, 2016USD ($)Segment | Mar. 31, 2015USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | ||
Number of operating segments | Segment | 1 | |
Inventory valuation reserves | $ 0 | |
Impairment loss | $ 0 | $ 0 |
Minimum [Member] | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Property and equipment useful lives | 2 years | |
Maximum [Member] | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Property and equipment useful lives | 10 years |
Summary of Significant Accoun23
Summary of Significant Accounting Policies - Potentially Dilutive Securities Excluded from Calculation of Diluted Net Loss Per Share (Detail) - shares | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from the calculation of diluted net loss per share | 4,803,169 | 2,912,938 |
Warrants to purchase common stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from the calculation of diluted net loss per share | 141,060 | 141,060 |
Unvested restricted common stock subject to repurchase [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from the calculation of diluted net loss per share | 297 | 10,961 |
Options to purchase common stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from the calculation of diluted net loss per share | 4,661,812 | 2,760,917 |
Available-for-Sale Securities -
Available-for-Sale Securities - Additional Information (Detail) - USD ($) | 3 Months Ended | |||
Mar. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | |
Schedule of Available-for-sale Securities [Line Items] | ||||
Cash and cash equivalents | $ 244,285,000 | $ 158,664,000 | $ 201,042,000 | $ 139,810,000 |
Short-term investments | 21,730,000 | 26,172,000 | ||
Unrealized gains or losses | 0 | |||
Other-than-temporary declines in the value of any available-for-sale securities | $ 0 | |||
Maximum maturity of available-for-sale investment securities | One year | |||
Certificates of deposit [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Short-term investments | $ 21,700,000 | 26,200,000 | ||
Available-for-sale Securities [Member] | Money market funds and certificates of deposit [Member] | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Cash and cash equivalents | $ 13,400,000 | $ 8,900,000 |
Balance Sheet Details - Prepaid
Balance Sheet Details - Prepaid and Other Current Assets (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid clinical trial costs | $ 2,437 | $ 2,024 |
Other | 1,523 | 1,295 |
Total | $ 3,960 | $ 3,319 |
Balance Sheet Details - Summary
Balance Sheet Details - Summary of Inventory (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 107 | $ 0 |
Finished goods | 402 | 0 |
Deferred cost of product sales | 105 | 0 |
Total | $ 614 | $ 0 |
Balance Sheet Details - Propert
Balance Sheet Details - Property and Equipment, Net (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 4,501 | $ 4,226 |
Less: accumulated depreciation and amortization | (1,290) | (1,132) |
Total | 3,211 | 3,094 |
Laboratory Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,531 | 2,409 |
Manufacturing Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,432 | 1,330 |
Computer Equipment and Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 341 | 303 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 123 | 123 |
Office Furniture [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 74 | $ 61 |
Balance Sheet Details - Accrued
Balance Sheet Details - Accrued Expenses (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Accrued clinical trial costs | $ 1,979 | $ 1,763 |
Accrued other | 2,602 | 2,788 |
Total | $ 4,581 | $ 4,551 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | May. 31, 2015USD ($) | Mar. 31, 2015USD ($) | Mar. 31, 2016USD ($)Milestone | Mar. 31, 2015USD ($) | Oct. 31, 2014USD ($) |
Other Commitments [Line Items] | |||||
Milestone fees | $ 0 | $ 1,000,000 | |||
Operating lease term | 130 months | ||||
Additional operating lease term | 5 years | ||||
Period after which company has the right to terminate lease if it is acquired by a third party and pays early termination fee | 94 months | ||||
Base rent for first year | $ 232,000 | ||||
Lease rate increase, percentage | 3.00% | ||||
Abatement period of monthly base rent | 10 months | ||||
Estimated base rent payments over the life of lease | $ 32,700,000 | ||||
Restricted Cash [Member] | |||||
Other Commitments [Line Items] | |||||
Security deposit in the form of letter of credit | $ 695,000 | ||||
Building [Member] | |||||
Other Commitments [Line Items] | |||||
Construction completion period | 2016-10 | ||||
Intellectual Property [Member] | |||||
Other Commitments [Line Items] | |||||
Milestone fees | $ 2,800,000 | ||||
Maximum percentage of royalties on sales | 5.00% | ||||
Intellectual Property [Member] | Regulatory [Member] | |||||
Other Commitments [Line Items] | |||||
Number of milestones achieved | Milestone | 1 | ||||
Milestone payment | $ 1,000,000 | ||||
Intellectual Property [Member] | Development [Member] | |||||
Other Commitments [Line Items] | |||||
Number of milestones achieved | Milestone | 6 | ||||
Royalty Agreements [Member] | |||||
Other Commitments [Line Items] | |||||
Milestone fees | $ 500,000 | ||||
Maximum percentage of royalties on sales | 1.00% | ||||
Royalty period | 10 years | ||||
Data License Agreement [Member] | |||||
Other Commitments [Line Items] | |||||
Description of royalties payable | The Company is obligated to pay Ipsen low single-digit royalties on annual net sales of OTO-311 by the Company or its affiliates or sublicensees | ||||
Maximum cumulative royalties paid under license agreement | $ 10,000,000 |
Commitments and Contingencies30
Commitments and Contingencies - Schedule of Additional Milestone Payments (Detail) $ in Thousands | 3 Months Ended |
Mar. 31, 2016USD ($) | |
Other Commitments [Line Items] | |
Cash Payments | $ 13,250 |
Development [Member] | |
Other Commitments [Line Items] | |
Cash Payments | 2,100 |
Regulatory [Member] | |
Other Commitments [Line Items] | |
Cash Payments | 10,150 |
Commercialization [Member] | |
Other Commitments [Line Items] | |
Cash Payments | $ 1,000 |
Commitments and Contingencies31
Commitments and Contingencies - Summary of Cost Recognized in Research and Development under Intellectual Property License Agreements (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | ||
License and other fees | $ 21 | $ 6 |
Milestone fees | 0 | 1,000 |
Total license and related fees | $ 21 | $ 1,006 |
Fair Value - Additional informa
Fair Value - Additional information (Detail) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Fair Value Disclosures [Abstract] | ||
Liabilities measured at fair value on recurring basis | $ 0 | $ 0 |
Fair Value - Fair Value Assets
Fair Value - Fair Value Assets Measured on a Recurring Basis (Detail) - Fair Value Measurements, Recurring [Member] - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Assets | ||
Total assets | $ 35,097 | $ 35,103 |
Money market funds [Member] | ||
Assets | ||
Money market funds | 13,107 | 8,020 |
Certificates of deposit [Member] | ||
Assets | ||
Short-term investments | 21,990 | 27,083 |
Level 1 [Member] | ||
Assets | ||
Total assets | 13,107 | 8,020 |
Level 1 [Member] | Money market funds [Member] | ||
Assets | ||
Money market funds | 13,107 | 8,020 |
Level 1 [Member] | Certificates of deposit [Member] | ||
Assets | ||
Short-term investments | 0 | 0 |
Level 2 [Member] | ||
Assets | ||
Total assets | 21,990 | 27,083 |
Level 2 [Member] | Money market funds [Member] | ||
Assets | ||
Money market funds | 0 | 0 |
Level 2 [Member] | Certificates of deposit [Member] | ||
Assets | ||
Short-term investments | 21,990 | 27,083 |
Level 3 [Member] | ||
Assets | ||
Total assets | 0 | 0 |
Level 3 [Member] | Money market funds [Member] | ||
Assets | ||
Money market funds | 0 | 0 |
Level 3 [Member] | Certificates of deposit [Member] | ||
Assets | ||
Short-term investments | $ 0 | $ 0 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Shares of Common Stock Reserved for Future Issuance (Detail) - shares | Mar. 31, 2016 | Dec. 31, 2015 |
Class of Stock [Line Items] | ||
Total common stock reserved for future issuance | 7,882,275 | 6,334,279 |
Warrants to purchase common stock [Member] | ||
Class of Stock [Line Items] | ||
Total common stock reserved for future issuance | 141,060 | 141,060 |
Options to purchase common stock [Member] | ||
Class of Stock [Line Items] | ||
Total common stock reserved for future issuance | 4,661,812 | 3,413,142 |
Available Future Grant Year [Member] | Options to purchase common stock [Member] | ||
Class of Stock [Line Items] | ||
Total common stock reserved for future issuance | 2,066,016 | 2,131,646 |
2014 Employee Stock Purchase Plan [Member] | ||
Class of Stock [Line Items] | ||
Total common stock reserved for future issuance | 1,013,387 | 648,431 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - Equity Incentive Plan 2014 [Member] | 3 Months Ended |
Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Contractual term of options | 10 years |
Share based compensation vesting period | 4 years |
Minimum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Exercise price, percentage of fair market value | 100.00% |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option Activity (Detail) shares in Thousands | 3 Months Ended |
Mar. 31, 2016$ / sharesshares | |
Options | |
Outstanding as of beginning of period | shares | 3,413 |
Granted | shares | 1,287 |
Exercised | shares | (33) |
Forfeited | shares | (5) |
Outstanding as of end of period | shares | 4,662 |
Weighted- Average Exercise Price | |
Outstanding as of beginning of period | $ / shares | $ 14.86 |
Granted | $ / shares | 14.54 |
Exercised | $ / shares | 3.79 |
Forfeited | $ / shares | 27.91 |
Outstanding as of end of period | $ / shares | $ 14.84 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Non-cash Stock Based Compensation Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | $ 2,736 | $ 1,343 |
Research and development [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | 647 | 552 |
Selling, general and administrative [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | $ 2,089 | $ 791 |