Adverum Biotechnologies (ADVM) 10-Q 12 Aug 24 2024 Q2 Quarterly report Financial data

Cover Page

Cover Page - shares	6 Months Ended
	Jun. 30, 2024	Aug. 02, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2024
Document Transition Report	false
Entity File Number	001-36579
Entity Registrant Name	Adverum Biotechnologies, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	20-5258327
Entity Address, Address Line One	100 Cardinal Way
Entity Address, City or Town	Redwood City
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94063
City Area Code	650
Local Phone Number	656-9323
Title of 12(b) Security	Common Stock, $0.0001 par value
Trading Symbol	ADVM
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		20,800,903
Amendment Flag	false
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Entity Central Index Key	0001501756
Current Fiscal Year End Date	--12-31

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 127,321	$ 75,000
Short-term investments	46,506	21,526
Prepaid expenses and other current assets	5,591	6,247
Total current assets	179,418	102,773
Operating lease right-of-use assets	51,237	52,266
Property and equipment, net	13,047	14,764
Restricted cash	1,976	1,976
Deferred rent receivable	6,963	0
Deposit and other long-term assets	1,162	1,231
Total assets	253,803	173,010
Current liabilities:
Accounts payable	1,973	1,921
Accrued expenses and other current liabilities	9,912	12,584
Lease liability, current portion	10,576	10,409
Total current liabilities	22,461	24,914
Lease liability, net of current portion	63,313	64,627
Total liabilities	85,774	89,541
Stockholders’ equity:
Preferred stock	0	0
Common stock	2	1
Additional paid-in capital	1,131,592	1,003,718
Accumulated other comprehensive loss	(525)	(473)
Accumulated deficit	(963,040)	(919,777)
Total stockholders’ equity	168,029	83,469
Total liabilities and stockholders’ equity	$ 253,803	$ 173,010

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Statement [Abstract]
License revenue	$ 0	$ 0	$ 0	$ 3,600
Operating expenses:
Research and development	17,097	20,599	32,507	41,658
General and administrative	3,785	12,466	15,214	25,246
Total operating expenses	20,882	33,065	47,721	66,904
Operating loss	(20,882)	(33,065)	(47,721)	(63,304)
Other income, net	2,406	1,576	4,458	2,776
Net loss before income taxes	(18,476)	(31,489)	(43,263)	(60,528)
Income tax provision	0	(21)	0	(38)
Net loss	(18,476)	(31,510)	(43,263)	(60,566)
Other comprehensive loss:
Net unrealized (loss) gain on marketable securities	(2)	198	(43)	937
Foreign currency translation adjustment	10	(5)	(9)	(12)
Comprehensive loss	$ (18,468)	$ (31,317)	$ (43,315)	$ (59,641)
Net loss per share — basic (in USD per share)	$ (0.89)	$ (3.13)	$ (2.31)	$ (6.02)
Net loss per share — diluted (in USD per share)	$ (0.89)	$ (3.13)	$ (2.31)	$ (6.02)
Weighted-average common shares used to compute net loss per share - basic (in shares)	20,852	10,077	18,713	10,054
Weighted-average common shares used to compute net loss per share - diluted (in shares)	20,852	10,077	18,713	10,054

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholders’ Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit
Beginning balance (in shares) at Dec. 31, 2022		10,012
Beginning balance at Dec. 31, 2022	$ 181,518	$ 1	$ 985,660	$ (1,531)	$ (802,612)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation expense	4,563		4,563
Common stock issued upon release of restricted stock units (in shares)		45
Restricted stock surrendered for taxes	0
Foreign currency translation adjustments	(7)			(7)
Unrealized gain (loss) on marketable securities, net	739			739
Net loss	(29,056)				(29,056)
Ending balance (in shares) at Mar. 31, 2023		10,057
Ending balance at Mar. 31, 2023	157,757	$ 1	990,223	(799)	(831,668)
Beginning balance (in shares) at Dec. 31, 2022		10,012
Beginning balance at Dec. 31, 2022	181,518	$ 1	985,660	(1,531)	(802,612)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Foreign currency translation adjustments	(12)
Unrealized gain (loss) on marketable securities, net	937
Net loss	(60,566)
Ending balance (in shares) at Jun. 30, 2023		10,099
Ending balance at Jun. 30, 2023	131,155	$ 1	994,938	(606)	(863,178)
Beginning balance (in shares) at Mar. 31, 2023		10,057
Beginning balance at Mar. 31, 2023	157,757	$ 1	990,223	(799)	(831,668)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation expense	4,469		4,469
Common stock issued under employee stock purchase plan (in shares)		42
Common stock issued under employee stock purchase plan	246		246
Foreign currency translation adjustments	(5)			(5)
Unrealized gain (loss) on marketable securities, net	198			198
Net loss	(31,510)				(31,510)
Ending balance (in shares) at Jun. 30, 2023		10,099
Ending balance at Jun. 30, 2023	131,155	$ 1	994,938	(606)	(863,178)
Beginning balance (in shares) at Dec. 31, 2023		10,143
Beginning balance at Dec. 31, 2023	83,469	$ 1	1,003,718	(473)	(919,777)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation expense	4,166		4,166
Issuance of common stock and pre-funded warrants for cash in private placement, net of issuance costs of $8,449 (in shares)		10,573
Issuance of common stock and pre-funded warrants for cash in private placements, net of issuance costs of $8,449	119,361	$ 1	119,360
Common stock issued upon exercise of stock options (in shares)		14
Common stock issued upon exercise of stock options	139		139
Common stock issued upon release of restricted stock units (in shares)		25
Foreign currency translation adjustments	(19)			(19)
Unrealized gain (loss) on marketable securities, net	(41)			(41)
Net loss	(24,787)				(24,787)
Ending balance (in shares) at Mar. 31, 2024		20,755
Ending balance at Mar. 31, 2024	182,288	$ 2	1,127,383	(533)	(944,564)
Beginning balance (in shares) at Dec. 31, 2023		10,143
Beginning balance at Dec. 31, 2023	$ 83,469	$ 1	1,003,718	(473)	(919,777)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock issued upon exercise of stock options (in shares)	14
Foreign currency translation adjustments	$ (9)
Unrealized gain (loss) on marketable securities, net	(43)
Net loss	(43,263)
Ending balance (in shares) at Jun. 30, 2024		20,801
Ending balance at Jun. 30, 2024	168,029	$ 2	1,131,592	(525)	(963,040)
Beginning balance (in shares) at Mar. 31, 2024		20,755
Beginning balance at Mar. 31, 2024	182,288	$ 2	1,127,383	(533)	(944,564)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation expense	3,945		3,945
Common stock issued upon release of restricted stock units (in shares)		2
Common stock issued under employee stock purchase plan (in shares)		44
Common stock issued under employee stock purchase plan	264		264
Foreign currency translation adjustments	10			10
Unrealized gain (loss) on marketable securities, net	(2)			(2)
Net loss	(18,476)				(18,476)
Ending balance (in shares) at Jun. 30, 2024		20,801
Ending balance at Jun. 30, 2024	$ 168,029	$ 2	$ 1,131,592	$ (525)	$ (963,040)

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Stockholders Equity (Parenthetical) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Statement of Stockholders' Equity [Abstract]
Stock issuance costs	$ 8,449

Condensed Consolidated Statem_4

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Cash flows from operating activities:
Net loss	$ (43,263)	$ (60,566)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	1,953	3,126
Stock-based compensation expense	8,111	9,032
Net accretion of discount on marketable securities	(775)	(1,675)
Non-cash lease expense	1,029	6,936
Other	(9)	(306)
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	656	775
Deposit and other long-term assets and deferred rent receivable	(6,894)	105
Accounts payable	(111)	(944)
Accrued expenses and other liabilities	(2,639)	(525)
Lease liability	(1,147)	(1,619)
Net cash used in operating activities	(43,089)	(45,661)
Cash flows from investing activities:
Purchases of marketable securities	(49,448)	(20,232)
Maturities of marketable securities	25,200	108,909
Purchases of property and equipment	(106)	(121)
Net cash (used in) provided by investing activities	(24,354)	88,556
Cash flows from financing activities:
Proceeds from issuance of common stock and pre-funded warrants in private placements, net of issuance costs	119,361	0
Proceeds from issuance of common stock pursuant to option exercises	139	0
Payment of deferred offering costs	0	(238)
Proceeds from employee stock purchase plan	264	246
Net cash provided by financing activities	119,764	8
Net increase in cash and cash equivalents and restricted cash	52,321	42,903
Cash and cash equivalents and restricted cash at beginning of period	76,976	70,934
Cash and cash equivalents and restricted cash at end of period	129,297	113,837
Cash and cash equivalents	127,321	111,187
Restricted cash	1,976	2,650
Cash and cash equivalents and restricted cash at end of period	129,297	113,837
Supplemental schedule of noncash investing and financing information
Deferred offering costs included in accounts payable and accrued expenses	0	107
Remeasurement of operating lease right-of-use assets	0	13,711
Property and equipment in accounts payable, accrued expenses and other current liabilities	$ 221	$ 496

Organization and Basis of Prese

Organization and Basis of Presentation	6 Months Ended
	Jun. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Basis of Presentation	Organization and Basis of Presentation Adverum Biotechnologies, Inc. (the “Company” or “Adverum”) was incorporated in Delaware on July 17, 2006 and is headquartered in Redwood City, California. The Company aims to establish gene therapy as a new standard of care for highly prevalent ocular diseases. The Company develops gene therapy product candidates intended to provide durable efficacy by inducing sustained expression of a therapeutic protein. The Company has not generated any revenue from the sale of products since its inception. The Company has experienced net losses since its inception and had an accumulated deficit of $963.0 million as of June 30, 2024. The Company expects to incur losses and have negative net cash flows from operating activities as it engages in further research and development activities. As of June 30, 2024, the Company had cash, cash equivalents and short-term investments of $173.8 million, which the Company believes will be sufficient to fund its operations into late 2025. Basis of Presentation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and follow the requirements of the Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These unaudited condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the Company’s consolidated financial information. The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results to be expected for the full year or any other future period. The balance sheet as of December 31, 2023 is derived from the audited consolidated financial statements at that date but does not include all of the information required by U.S. GAAP for complete consolidated financial statements. The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC.

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosures. Management bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances. These estimates form the basis for making judgments about the carrying values of assets and liabilities when these values are not readily apparent from other sources. Accounting estimates and judgments are inherently uncertain, and actual results could differ from these estimates. March 2024 Reverse Stock Split On March 21, 2024, the Company effected a 1-for-10 reverse stock split of its common stock. The par value and the authorized shares of the common stock were not adjusted as a result of the reverse stock split. All equity related information including per share amounts for all periods presented in these financial statements and the notes thereto have been adjusted retroactively, where applicable, to reflect this reverse stock split. Recent Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). The amendments in ASU 2023-07 are intended to improve reportable segment disclosure, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for annual periods beginning after December 15, 2023, and interim periods beginning after December 15, 2024. The amendments in this ASU should be applied retrospectively to all prior periods presented in the financial statements. Early adoption is permitted. The Company is evaluating the impact of this guidance on its financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires enhanced annual disclosures regarding the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 and may be adopted on a prospective or retrospective basis. Early adoption is permitted. The Company is evaluating the impact of this guidance on its financial statements and related disclosures.

Fair Value Measurements and Fai

Fair Value Measurements and Fair Value of Financial Instruments	6 Months Ended
	Jun. 30, 2024
Fair Value Disclosures [Abstract]
Fair Value Measurements and Fair Value of Financial Instruments	Fair Value Measurements and Fair Value of Financial Instruments The authoritative guidance on the fair value hierarchy for disclosure of fair value measurements is as follows: Level 1 : Quoted prices in active markets for identical assets or liabilities. Level 2 : Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 : Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 1 securities consist of highly liquid money market funds. U.S. government and agency securities and commercial paper are valued primarily using market prices of comparable securities, bid/ask quotes, interest rate yields and prepayment spreads and are included in Level 2. The following is a summary of the Company’s cash equivalents and short-term investments: June 30, 2024 Amortized Cost Basis Unrealized Gains Unrealized Estimated Fair Value (In thousands) Level 1: Money market funds $ 161 $ — $ — $ 161 Level 2: Commercial paper 127,060 — (69) 126,991 U.S. government and agency securities 38,133 1 (22) 38,112 Total cash equivalents and short-term investments 165,354 1 (91) 165,264 Less: Cash equivalents (118,814) — 56 (118,758) Total short-term investments $ 46,540 $ 1 $ (35) $ 46,506 December 31, 2023 Amortized Cost Basis Unrealized Gains Unrealized Estimated Fair Value (In thousands) Level 1: Money market funds $ 10,204 $ — $ — $ 10,204 Level 2: Commercial paper 64,693 — (35) 64,658 U.S. government and agency securities 17,616 4 (17) 17,603 Total cash equivalents and short-term investments 92,513 4 (52) 92,465 Less: Cash equivalents (70,972) — 33 (70,939) Total short-term investments $ 21,541 $ 4 $ (19) $ 21,526 As of June 30, 2024, the stated maturities of the Company’s investments portfolio are generally less than one year. The Company classifies its investments as short-term marketable securities even though the stated maturities may be one year or more beyond of the current balance sheet date as the Company has the ability to sell these securities at any time for use in current operations. The aggregate fair value of debt securities in an unrealized loss position at June 30, 2024 and December 31, 2023 was $160.2 million and $71.3 million, respectively, which are highly liquid funds with high credit ratings that have final maturities of less than two years from date of purchase. The Company has not recorded an allowance for credit losses as of June 30, 2024 and December 31, 2023 related to these securities. The accrued interest receivable on available-for-sale marketable securities was immaterial at June 30, 2024 and December 31, 2023. The Company held 45 securities that were in unrealized loss positions as of June 30, 2024. There were no individual securities that were in a significant unrealized loss position as of June 30, 2024 and December 31, 2023. The Company regularly reviews the securities in an unrealized loss position and evaluates the current expected credit loss by considering factors such as historical experience, market data, issuer-specific factors, and current economic conditions. The Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases. The Company had not recorded any impairment charges on available-for-sale securities as of June 30, 2024 and December 31, 2023.

License Revenue

License Revenue	6 Months Ended
	Jun. 30, 2024
Revenue from Contract with Customer [Abstract]
License Revenue	License Revenue Lexeo - On January 25, 2021, the Company and Lexeo Therapeutics, Inc (“Lexeo”) entered into a License Agreement pursuant to which the Company granted Lexeo an exclusive, worldwide, royalty-bearing license to certain of the Company’s intellectual property to develop, manufacture, and commercialize a gene therapy product to treat cardiomyopathy due to Friedreich’s Ataxia. Under the terms of the agreement, the Company is eligible to receive additional payments upon the achievement of certain milestones. Additionally, the Company will receive royalty payments on net sales subject to a cap and reductions based on patent expiry, anti-stacking, and a defined royalty floor percentage. In February 2023, Lexeo notified the Company that it achieved the first development milestone; accordingly, the Company is eligible to receive additional payments. Therefore, the Company recognized $3.5 million of license revenue during the six months ended June 30, 2023. No milestones were achieved and no license revenue was recognized during the six months ended June 30, 2024.

Leases

Leases	6 Months Ended
	Jun. 30, 2024
Leases [Abstract]
Leases	Leases Redwood City The Company has a lease for facilities in Redwood City, California (“Redwood City Premises”), which expires December 31, 2031, with an option to extend for a period of eight years. Related to this lease, the Company provided the landlord with a letter of credit, as amended, in the amount of $1.9 million, which is classified as restricted cash under long term assets on the Company’s condensed consolidated balance sheets. Prior to September 30, 2023, the Company had two facility leases in Redwood City. In March 2023, the Company entered into an amendment to accelerate the expiration of the lease for one of the facilities in its Redwood City Premises from December 31, 2031 to September 30, 2023. Concurrently, the Company entered into an agreement for additional tenant improvement allowance towards its other Redwood City Premises. The Company accounted for this amendment as a lease modification in accordance with ASC 842-10-25-11(d). As a result of the modification the Company revalued the lease liability based on the new and remaining lease terms, which resulted in a reduction to the lease liability of $8.3 million, and recognized the remeasurement to the lease liabilities as an adjustment to the right-of-use asset. The estimated value of non-cash consideration, composed primarily of leasehold improvements and furniture and fixtures, was $14.9 million, which was fully amortized as of September 30, 2023. There was no charge recognized in the consolidated statement of operations. North Carolina On January 8, 2021, the Company entered into an operating lease agreement for a building in North Carolina (“NC Premises”). The lease commenced in April 2021 when the Company obtained control of the NC Premises, and the lease term expires in October 2037 with two options to extend the lease term for a period of five years each. On October 26, 2021, the Company entered into a sublease agreement with a subtenant for the NC Premises through October 2037, the remainder of the lease term, and concurrently changed the lease payment terms of the head lease. In addition, the remainder of the tenant improvement allowance under the original lease of approximately $22.7 million was transferred to the subtenant. This change in the Company’s payment terms with the landlord at the time of the sublease was considered to be a lease modification and the Company remeasured the lease liability and right-of-use asset on the modification date, with no amounts recognized in the consolidated statement of operations. The base annual rental rates, payment schedules and amounts under the sublease agreement are substantially the same as the original payment terms by Adverum to the landlord. On April 3, 2023, the Company entered into an amendment of the lease of its NC Premises with the landlord and subtenant. Under this amendment, the parties agreed to substantially reduce the total tenant improvement allowance in exchange for lower monthly rent. The Company accounted for this amendment as a lease modification in accordance with ASC 842-10-25-11(d). The Company remeasured the lease liability, resulting in a reduction to the lease liability with a corresponding reduction of the right-of-use asset of $5.7 million in the quarter ended June 30, 2023. There was no charge recognized in the consolidated statement of operations. During the year ended December 31, 2022, management reassessed the probability of collection of the deferred rent receivable from the subtenant over the remaining term of a sublease. At that time, management assessed the collectability to be less than probable and recognized an adjustment to eliminate the deferred rent receivable as a current period adjustment during the year ended December 31, 2022. Deferred rent receivable was zero as of December 31, 2023. During the three months ended June 30, 2024, given the recent funding obtained by the subtenant, management reassessed the probability of the collection of the deferred rent receivable from the subtenant over the remaining term of the sublease. The Company assessed the collectibility to be probable and recognized a cumulative catch-up adjustment for the difference between the straight-line lease income that would have been recognized if collectability had always been assessed as probable and the lease income recognized from lease commencement to date. Consequently, the Company has recognized $7.0 million in sublease income, representing the straight-line sublease income since inception less sublease income recognized as of June 30, 2024. This adjustment decreased general and administrative expense and net loss by $7.0 million and resulted in a $0.33 and $0.37 reduction in the Company’s basic and diluted net loss per common share for the three and six months ended June 30, 2024, respectively. Excluding the adjustment, the net loss and net loss per common share for the three and six months ended June 30, 2024 would have been $25.4 million and $50.2 million and $1.22 and $2.68 per share, respectively. This change is not expected to have a material effect in future periods. Sublease income was $8.2 million and $9.6 million for the three and six months ended June 30, 2024, respectively, and $1.4 million and $2.8 million for the three and six months ended June 30, 2023, respectively, and was classified as a reduction of rent expense in general and administrative expense.

Balance Sheet Components

Balance Sheet Components	6 Months Ended
	Jun. 30, 2024
Balance Sheet Related Disclosures [Abstract]
Balance Sheet Components	Balance Sheet Components Property and Equipment, Net Property and equipment, net consists of the following: June 30, 2024 December 31, 2023 (In thousands) Laboratory equipment $ 14,876 $ 14,638 Leasehold improvements 13,586 13,586 Computer equipment and software 900 868 Construction in progress 33 184 Total property and equipment 29,395 29,276 Less: Accumulated depreciation and amortization (16,348) (14,512) Property and equipment, net $ 13,047 $ 14,764 Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following: June 30, 2024 December 31, 2023 (In thousands) Employee compensation $ 5,332 $ 8,040 Accrued nonclinical, clinical and process development costs 3,212 3,367 Accrued professional services 658 351 State income tax payable 79 101 Other 631 725 Total accrued expenses and other current liabilities $ 9,912 $ 12,584

Stockholders' Equity

Stockholders' Equity	6 Months Ended
	Jun. 30, 2024
Share-Based Payment Arrangement [Abstract]
Stockholders' Equity	Stockholders' Equity February 2024 Private Placements On February 7, 2024, the Company entered into a securities purchase agreement, pursuant to which the Company sold 10.5 million shares of its common stock and, in lieu of common stock, pre-funded warrants to purchase an aggregate of 75,000 shares of common stock (the “Pre-Funded Warrants”) to certain institutional and accredited investors in a private placement. The purchase price per share was $12.00, or $11.999 per Pre-Funded Warrant, which represents the purchase price per share minus the $0.001 per share exercise price of each Pre-Funded Warrant. Such Pre-Funded Warrants can be exercised at any time and have no expiration date. The exercise of the outstanding Pre-Funded Warrants is subject to a beneficial ownership limitation of 9.99%. The Pre-Funded Warrants were classified as a component of stockholders' equity. As of June 30, 2024, none of the Pre-Funded Warrants had been exercised. Concurrently, the Company also entered into a securities purchase agreement with two directors of the Company (together with the private placement to certain institutional and accredited investors, the “Private Placements”). The Company issued and sold 23,000 shares at $13.50 per share on otherwise substantially the same terms as those set forth in the Securities Purchase Agreement. At the close of the Private Placements on February 7, 2024, the Company received total gross proceeds of $127.8 million, before deducting placement agent fees and offering expenses. Equity Incentive Awards Stock Options The following table summarizes the Company’s option activity and related information: Number of Weighted- Balance at December 31, 2023 2,303 $ 48.71 Options granted 776 15.44 Options exercised (14) 10.14 Options forfeited (192) 38.94 Balance at June 30, 2024 2,873 $ 40.55 Exercisable as of June 30, 2024 1,350 $ 68.71 Restricted Stock Units (“RSUs”) The following table summarizes the Company’s RSUs activity and related information: Number of Units Weighted- Outstanding at December 31, 2023 154 $ 21.73 Granted 75 18.81 Vested and released (27) 27.32 Forfeited (16) 14.02 Outstanding at June 30, 2024 186 $ 20.41 Stock-Based Compensation Expense The following table presents, by operating expense, the Company’s stock-based compensation expense: Three Months Ended Six Months Ended 2024 2023 2024 2023 (In thousands) Research and development $ 1,088 $ 1,380 $ 2,208 $ 2,761 General and administrative 2,857 3,089 5,903 6,271 Total stock-based compensation expense $ 3,945 $ 4,469 $ 8,111 $ 9,032

Net Loss per Share

Net Loss per Share	6 Months Ended
	Jun. 30, 2024
Earnings Per Share [Abstract]
Net Loss per Share	Net Loss per Share Basic net loss per share is calculated by dividing the net loss by the weighted-average number of shares of common stock outstanding for the period. Diluted net loss per share is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period using the treasury stock method. Outstanding stock options, RSUs and rights under the employee stock purchase plan (“ESPP”) are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. For the three and six months ended June 30, 2024, the pre-funded warrants to purchase the Company's shares of common stock issued in the Private Placements were included in the basic and diluted net loss per share calculation as the exercise price is non-substantive and virtually assured. The following common stock equivalents outstanding at the end of the periods presented were excluded from the calculation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect: June 30, 2024 June 30, 2023 (In thousands) Stock options 2,873 2,351 Restricted stock units 186 173 ESPP 21 25 3,080 2,549

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2024	Mar. 31, 2024	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net loss	$ (18,476)	$ (24,787)	$ (31,510)	$ (29,056)	$ (43,263)	$ (60,566)

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended
	Jun. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and follow the requirements of the Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These unaudited condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the Company’s consolidated financial information. The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results to be expected for the full year or any other future period. The balance sheet as of December 31, 2023 is derived from the audited consolidated financial statements at that date but does not include all of the information required by U.S. GAAP for complete consolidated financial statements. The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC.
Use of Estimates	Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosures. Management bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances. These estimates form the basis for making judgments about the carrying values of assets and liabilities when these values are not readily apparent from other sources. Accounting estimates and judgments are inherently uncertain, and actual results could differ from these estimates.
March 2024 Reverse Stock Split	March 2024 Reverse Stock Split On March 21, 2024, the Company effected a 1-for-10 reverse stock split of its common stock. The par value and the authorized shares of the common stock were not adjusted as a result of the reverse stock split. All equity related information including per share amounts for all periods presented in these financial statements and the notes thereto have been adjusted retroactively, where applicable, to reflect this reverse stock split.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). The amendments in ASU 2023-07 are intended to improve reportable segment disclosure, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for annual periods beginning after December 15, 2023, and interim periods beginning after December 15, 2024. The amendments in this ASU should be applied retrospectively to all prior periods presented in the financial statements. Early adoption is permitted. The Company is evaluating the impact of this guidance on its financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires enhanced annual disclosures regarding the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 and may be adopted on a prospective or retrospective basis. Early adoption is permitted. The Company is evaluating the impact of this guidance on its financial statements and related disclosures.

Fair Value Measurements and F_2

Fair Value Measurements and Fair Value of Financial Instruments (Tables)	6 Months Ended
	Jun. 30, 2024
Fair Value Disclosures [Abstract]
Schedule of Cash Equivalents and Short-term Investments	The following is a summary of the Company’s cash equivalents and short-term investments: June 30, 2024 Amortized Cost Basis Unrealized Gains Unrealized Estimated Fair Value (In thousands) Level 1: Money market funds $ 161 $ — $ — $ 161 Level 2: Commercial paper 127,060 — (69) 126,991 U.S. government and agency securities 38,133 1 (22) 38,112 Total cash equivalents and short-term investments 165,354 1 (91) 165,264 Less: Cash equivalents (118,814) — 56 (118,758) Total short-term investments $ 46,540 $ 1 $ (35) $ 46,506 December 31, 2023 Amortized Cost Basis Unrealized Gains Unrealized Estimated Fair Value (In thousands) Level 1: Money market funds $ 10,204 $ — $ — $ 10,204 Level 2: Commercial paper 64,693 — (35) 64,658 U.S. government and agency securities 17,616 4 (17) 17,603 Total cash equivalents and short-term investments 92,513 4 (52) 92,465 Less: Cash equivalents (70,972) — 33 (70,939) Total short-term investments $ 21,541 $ 4 $ (19) $ 21,526

Balance Sheet Components (Table

Balance Sheet Components (Tables)	6 Months Ended
	Jun. 30, 2024
Balance Sheet Related Disclosures [Abstract]
Schedule of Property and Equipment, Net	Property and equipment, net consists of the following: June 30, 2024 December 31, 2023 (In thousands) Laboratory equipment $ 14,876 $ 14,638 Leasehold improvements 13,586 13,586 Computer equipment and software 900 868 Construction in progress 33 184 Total property and equipment 29,395 29,276 Less: Accumulated depreciation and amortization (16,348) (14,512) Property and equipment, net $ 13,047 $ 14,764
Schedule of Accrued Expenses and Other Current Liabilities	Accrued expenses and other current liabilities consist of the following: June 30, 2024 December 31, 2023 (In thousands) Employee compensation $ 5,332 $ 8,040 Accrued nonclinical, clinical and process development costs 3,212 3,367 Accrued professional services 658 351 State income tax payable 79 101 Other 631 725 Total accrued expenses and other current liabilities $ 9,912 $ 12,584

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)	6 Months Ended
	Jun. 30, 2024
Share-Based Payment Arrangement [Abstract]
Schedule of Stock Options Activity	The following table summarizes the Company’s option activity and related information: Number of Weighted- Balance at December 31, 2023 2,303 $ 48.71 Options granted 776 15.44 Options exercised (14) 10.14 Options forfeited (192) 38.94 Balance at June 30, 2024 2,873 $ 40.55 Exercisable as of June 30, 2024 1,350 $ 68.71
Schedule of Restricted Stock Units Activity	The following table summarizes the Company’s RSUs activity and related information: Number of Units Weighted- Outstanding at December 31, 2023 154 $ 21.73 Granted 75 18.81 Vested and released (27) 27.32 Forfeited (16) 14.02 Outstanding at June 30, 2024 186 $ 20.41 Stock-Based Compensation Expense
Schedule of Stock-Based Compensation Expense	The following table presents, by operating expense, the Company’s stock-based compensation expense: Three Months Ended Six Months Ended 2024 2023 2024 2023 (In thousands) Research and development $ 1,088 $ 1,380 $ 2,208 $ 2,761 General and administrative 2,857 3,089 5,903 6,271 Total stock-based compensation expense $ 3,945 $ 4,469 $ 8,111 $ 9,032

Net Loss per Share (Tables)

Net Loss per Share (Tables)	6 Months Ended
	Jun. 30, 2024
Earnings Per Share [Abstract]
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	The following common stock equivalents outstanding at the end of the periods presented were excluded from the calculation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect: June 30, 2024 June 30, 2023 (In thousands) Stock options 2,873 2,351 Restricted stock units 186 173 ESPP 21 25 3,080 2,549

Organization and Basis of Pre_2

Organization and Basis of Presentation (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accumulated deficit	$ 963,040	$ 919,777
Cash, cash equivalents, and short-term investments	$ 173,800

Summary of Significant Accoun_3

Summary of Significant Accounting Policies - Additional Information (Details)	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
Reverse stock split ratio	0.10

Fair Value Measurements and F_3

Fair Value Measurements and Fair Value of Financial Instruments - Schedule of Cash Equivalents and Short-term Investments (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Debt Securities, Available-for-sale [Line Items]
Amortized Cost Basis	$ 46,540	$ 21,541
Unrealized Gains	1	4
Unrealized Losses	(35)	(19)
Estimated Fair Value	46,506	21,526
Less: cash equivalents, amortized cost basis	(118,814)	(70,972)
Less: cash equivalents, unrealized gains	0	0
Less: cash equivalents, unrealized losses	56	33
Less: cash equivalents, estimated fair value	(118,758)	(70,939)
Money market funds | Level 1:
Debt Securities, Available-for-sale [Line Items]
Amortized Cost Basis	161	10,204
Unrealized Gains	0	0
Unrealized Losses	0	0
Estimated Fair Value	161	10,204
Commercial paper | Level 2:
Debt Securities, Available-for-sale [Line Items]
Amortized Cost Basis	127,060	64,693
Unrealized Gains	0	0
Unrealized Losses	(69)	(35)
Estimated Fair Value	126,991	64,658
U.S. government and agency securities | Level 2:
Debt Securities, Available-for-sale [Line Items]
Amortized Cost Basis	38,133	17,616
Unrealized Gains	1	4
Unrealized Losses	(22)	(17)
Estimated Fair Value	38,112	17,603
Total cash equivalents and short-term investments
Debt Securities, Available-for-sale [Line Items]
Amortized Cost Basis	165,354	92,513
Unrealized Gains	1	4
Unrealized Losses	(91)	(52)
Estimated Fair Value	$ 165,264	$ 92,465

Fair Value Measurements and F_4

Fair Value Measurements and Fair Value of Financial Instruments - Additional Information (Details) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2024 USD ($) security	Dec. 31, 2023 USD ($)
Fair Value Disclosures [Abstract]
Marketable securities in an unrealized loss	$ 160.2	$ 71.3
Allowance for credit losses	$ 0	0
Number of securities, unrealized loss position | security	45
Impairment charges on available-for-sale securities	$ 0	$ 0

License Revenue (Details)

License Revenue (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2024 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2024 USD ($) milestone	Jun. 30, 2023 USD ($)
Disaggregation of Revenue [Line Items]
License revenue	$ 0	$ 0	$ 0	$ 3,600,000
Lexeo Therapeutics, Inc
Disaggregation of Revenue [Line Items]
License revenue			$ 0	$ 3,500,000
Number of milestones achieved | milestone			0

Leases - Additional Information

Leases - Additional Information (Details) $ / shares in Units, $ in Thousands	1 Months Ended	3 Months Ended				6 Months Ended
	Mar. 31, 2023 USD ($)	Jun. 30, 2024 USD ($) $ / shares	Mar. 31, 2024 USD ($)	Jun. 30, 2023 USD ($) $ / shares	Mar. 31, 2023 USD ($)	Jun. 30, 2024 USD ($) contract $ / shares	Jun. 30, 2023 USD ($) $ / shares	Dec. 31, 2023 USD ($)	Sep. 29, 2023 lease	Oct. 26, 2021 USD ($)
Lessee, Lease, Description [Line Items]
Restricted cash		$ 1,976		$ 2,650		$ 1,976	$ 2,650	$ 1,976
Number of facility leases | lease									2
Reduction in lease liability	$ 8,300
Non-cash settlement of operating lease liability	$ 14,900				$ 14,900
Re-measurement of operating lease liabilities				5,700
Re-measurement of operating lease right-of-use assets				5,700
Deferred rent receivable		6,963				6,963		$ 0
Lease income		7,000
General and administrative		(3,785)		(12,466)		(15,214)	(25,246)
Net loss		$ 18,476	$ 24,787	$ 31,510	$ 29,056	$ 43,263	$ 60,566
Basic net loss per share (in USD per share) | $ / shares		$ 0.89		$ 3.13		$ 2.31	$ 6.02
Diluted net loss per share (in USD per share) | $ / shares		$ 0.89		$ 3.13		$ 2.31	$ 6.02
Sublease income		$ 8,200		$ 1,400		$ 9,600	$ 2,800
Adjustment
Lessee, Lease, Description [Line Items]
General and administrative		$ 7,000
Net loss						$ 7,000
Basic net loss per share (in USD per share) | $ / shares		$ 0.33				$ 0.33
Diluted net loss per share (in USD per share) | $ / shares		$ 0.37				$ 0.37
Pro Forma
Lessee, Lease, Description [Line Items]
Net loss		$ 25,400				$ 50,200
Basic net loss per share (in USD per share) | $ / shares		$ 1.22				$ 1.22
Diluted net loss per share (in USD per share) | $ / shares		$ 2.68				$ 2.68
Building
Lessee, Lease, Description [Line Items]
Restricted cash		$ 1,900				$ 1,900
Manufacturing Facility
Lessee, Lease, Description [Line Items]
Leasehold improvement allowance										$ 22,700
California | Building
Lessee, Lease, Description [Line Items]
Lease renewal term		8 years				8 years
North Carolina | Manufacturing Facility
Lessee, Lease, Description [Line Items]
Lease renewal term		5 years				5 years
Number of renewal contracts | contract						2

Balance Sheet Components - Sche

Balance Sheet Components - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 29,395	$ 29,276
Less: Accumulated depreciation and amortization	(16,348)	(14,512)
Property and equipment, net	13,047	14,764
Laboratory equipment
Property, Plant and Equipment [Line Items]
Total property and equipment	14,876	14,638
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property and equipment	13,586	13,586
Computer equipment and software
Property, Plant and Equipment [Line Items]
Total property and equipment	900	868
Construction in progress
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 33	$ 184

Balance Sheet Components - Sc_2

Balance Sheet Components - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Balance Sheet Related Disclosures [Abstract]
Employee compensation	$ 5,332	$ 8,040
Accrued nonclinical, clinical and process development costs	3,212	3,367
Accrued professional services	658	351
State income tax payable	79	101
Other	631	725
Total accrued expenses and other current liabilities	$ 9,912	$ 12,584

Stockholders' Equity - Addition

Stockholders' Equity - Additional Information (Details) - Private Placement $ / shares in Units, $ in Millions	Feb. 07, 2024 USD ($) director $ / shares shares	Jun. 30, 2024 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares issued in transaction (in shares) | shares	10,500,000
Share price (in USD per share) | $ / shares	$ 12
Total gross proceeds | $	$ 127.8
Two Directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares issued in transaction (in shares) | shares	23,000
Share price (in USD per share) | $ / shares	$ 13.50
Number of directors | director	2
Pre-Funded Warrants
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock issued upon exercise of warrants (in shares) | shares	75,000
Share price (in USD per share) | $ / shares	$ 11.999
Exercise price (in USD per share) | $ / shares	$ 0.001
Beneficial ownership interest limitation (percent)		9.99%
Warrants exercised (in shares) | shares		0

Stockholders' Equity - Schedule

Stockholders' Equity - Schedule of Stock Options Activity (Details) shares in Thousands	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Number of Options (in thousands)
Beginning balance (in shares) | shares	2,303
Options granted (in shares) | shares	776
Options exercised (in shares) | shares	(14)
Options forfeited (in shares) | shares	(192)
Ending balance (in shares) | shares	2,873
Exercisable (in shares) | shares	1,350
Weighted- Average Exercise Price
Beginning balance (in USD per share) | $ / shares	$ 48.71
Options granted (in USD per share) | $ / shares	15.44
Options exercised (in USD per share) | $ / shares	10.14
Options forfeited (in USD per share) | $ / shares	38.94
Ending balance (in USD per share) | $ / shares	40.55
Exercisable (in USD per share) | $ / shares	$ 68.71

Stockholders' Equity - Schedu_2

Stockholders' Equity - Schedule of Restricted Stock Units Activity (Details) - Restricted stock units shares in Thousands	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Number of Units
Beginning balance (in shares) | shares	154
Granted (in shares) | shares	75
Vested and released (in shares) | shares	(27)
Forfeited (in shares) | shares	(16)
Ending balance (in shares) | shares	186
Weighted- Average Grant- Date Fair Value
Beginning balance (in USD per share) | $ / shares	$ 21.73
Granted (in USD per share) | $ / shares	18.81
Vested and released (in USD per share) | $ / shares	27.32
Forfeited (in USD per share) | $ / shares	14.02
Ending balance (in USD per share) | $ / shares	$ 20.41

Stockholders' Equity - Schedu_3

Stockholders' Equity - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense	$ 3,945	$ 4,469	$ 8,111	$ 9,032
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense	1,088	1,380	2,208	2,761
General and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense	$ 2,857	$ 3,089	$ 5,903	$ 6,271

Net Loss per Share (Details)

Net Loss per Share (Details) - shares shares in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from net loss per share (in shares)	3,080	2,549
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from net loss per share (in shares)	2,873	2,351
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from net loss per share (in shares)	186	173
ESPP
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from net loss per share (in shares)	21	25