Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 01, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-40337 | |
Entity Registrant Name | NEUROPACE, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 22-3550230 | |
Entity Address, Address Line One | 455 N. Bernardo Avenue | |
Entity Address, City or Town | Mountain View | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94043 | |
City Area Code | 650 | |
Local Phone Number | 237-2700 | |
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | NPCE | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 25,859,643 | |
Amendment Flag | false | |
Entity Central Index Key | 0001528287 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 |
Condensed Balance Sheets (unaud
Condensed Balance Sheets (unaudited) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 7,855 | $ 6,605 |
Short-term investments | 55,716 | 70,804 |
Accounts receivable | 10,876 | 7,482 |
Inventory | 10,014 | 9,712 |
Prepaid expenses and other current assets | 2,050 | 3,111 |
Total current assets | 86,511 | 97,714 |
Property and equipment, net | 976 | 1,064 |
Operating lease right-of-use asset | 14,136 | 14,838 |
Restricted cash | 122 | 122 |
Deferred offering costs | 466 | 347 |
Other assets | 21 | 21 |
Total assets | 102,232 | 114,106 |
Current liabilities | ||
Accounts payable | 1,807 | 2,147 |
Accrued liabilities | 8,182 | 7,414 |
Operating lease liability | 1,519 | 1,415 |
Total current liabilities | 11,508 | 10,976 |
Long-term debt | 54,854 | 52,913 |
Operating lease liability, net of current portion | 14,644 | 15,440 |
Total liabilities | 81,006 | 79,329 |
Commitments and contingencies (Note 5) | ||
Stockholders’ equity | ||
Preferred stock, $0.001 par value, 10,000,000 shares authorized and no shares issued and outstanding as of June 30, 2023 and December 31, 2022 | 0 | 0 |
Common stock, $0.001 par value, 200,000,000 shares authorized as of June 30, 2023 and December 31, 2022; 25,816,929 and 25,045,751 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively | 26 | 25 |
Additional paid-in capital | 511,552 | 506,713 |
Accumulated other comprehensive loss | 0 | (1,108) |
Accumulated deficit | (490,352) | (470,853) |
Total stockholders’ equity | 21,226 | 34,777 |
Total liabilities and stockholders’ equity | $ 102,232 | $ 114,106 |
Condensed Balance Sheets (una_2
Condensed Balance Sheets (unaudited) (Parenthetical) - $ / shares | Jun. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock issued (in shares) | 0 | 0 |
Preferred stock outstanding (in shares) | 0 | 0 |
Common stock par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock issued (in shares) | 25,816,929 | 25,045,751 |
Common stock outstanding (in shares) | 25,816,929 | 25,045,751 |
Condensed Statements of Operati
Condensed Statements of Operations and Comprehensive Loss (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Income Statement [Abstract] | ||||
Revenue | $ 16,510 | $ 10,200 | $ 30,982 | $ 21,574 |
Cost of goods sold | 4,538 | 2,734 | 8,638 | 5,849 |
Gross profit | 11,972 | 7,466 | 22,344 | 15,725 |
Operating expenses | ||||
Research and development | 5,343 | 5,669 | 10,606 | 11,246 |
Selling, general and administrative | 14,483 | 12,771 | 27,911 | 25,215 |
Total operating expenses | 19,826 | 18,440 | 38,517 | 36,461 |
Loss from operations | (7,854) | (10,974) | (16,173) | (20,736) |
Interest income | 733 | 221 | 1,459 | 355 |
Interest expense | (2,125) | (1,852) | (4,090) | (3,682) |
Other income (expense), net | 122 | (85) | (695) | (88) |
Net loss | (9,124) | (12,690) | (19,499) | (24,151) |
Unrealized loss on available-for-sale debt securities | 0 | (469) | 0 | (1,179) |
Comprehensive loss | $ (9,124) | $ (13,159) | $ (19,499) | $ (25,330) |
Net loss per share attributable to common stockholders, basic (in dollars per share) | $ (0.36) | $ (0.52) | $ (0.77) | $ (0.99) |
Net loss per share attributable to common stockholders, diluted (in dollars per share) | $ (0.36) | $ (0.52) | $ (0.77) | $ (0.99) |
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic (in shares) | 25,472,526 | 24,503,552 | 25,285,933 | 24,406,100 |
Weighted-average shares used in computing net loss per share attributable to common stockholders, diluted (in shares) | 25,472,526 | 24,503,552 | 25,285,933 | 24,406,100 |
Condensed Statements of Stockho
Condensed Statements of Stockholders’ Equity (unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2021 | 24,452,999 | ||||
Beginning balance at Dec. 31, 2021 | $ 73,503 | $ 24 | $ 497,522 | $ (272) | $ (423,771) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (11,461) | (11,461) | |||
Unrealized loss on available-for-sale debt securities | (710) | (710) | |||
Issuance of common stock pursuant to stock option exercises (in shares) | 38,635 | ||||
Issuance of common stock pursuant to stock option exercises | 1 | 1 | |||
Repurchase of common stock (in shares) | (14,454) | ||||
Repurchase of common stock | 0 | ||||
Change in early exercise liability | 2 | 2 | |||
Stock-based compensation | 1,488 | 1,488 | |||
Ending balance (in shares) at Mar. 31, 2022 | 24,477,180 | ||||
Ending balance at Mar. 31, 2022 | 62,823 | $ 24 | 499,013 | (982) | (435,232) |
Beginning balance (in shares) at Dec. 31, 2021 | 24,452,999 | ||||
Beginning balance at Dec. 31, 2021 | 73,503 | $ 24 | 497,522 | (272) | (423,771) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (24,151) | ||||
Unrealized loss on available-for-sale debt securities | (1,179) | ||||
Ending balance (in shares) at Jun. 30, 2022 | 24,814,855 | ||||
Ending balance at Jun. 30, 2022 | 52,902 | $ 25 | 502,250 | (1,451) | (447,922) |
Beginning balance (in shares) at Mar. 31, 2022 | 24,477,180 | ||||
Beginning balance at Mar. 31, 2022 | 62,823 | $ 24 | 499,013 | (982) | (435,232) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (12,690) | (12,690) | |||
Unrealized loss on available-for-sale debt securities | (469) | (469) | |||
Issuance of common stock pursuant to stock option exercises (in shares) | 74,435 | ||||
Issuance of common stock pursuant to stock option exercises | 2 | 2 | |||
Issuance of shares pursuant to employee stock purchase plan (in shares) | 147,217 | ||||
Stock issued during period, value, employee stock purchase plan | 679 | $ 1 | 678 | ||
Issuance of common stock upon vesting of restricted stock units (in shares) | 121,656 | ||||
Shares withheld for taxes (in shares) | (5,633) | ||||
Shares withheld for taxes | (47) | (47) | |||
Repurchase of common stock | 0 | ||||
Change in early exercise liability | 1 | (1) | |||
Stock-based compensation | 2,603 | 2,603 | |||
Ending balance (in shares) at Jun. 30, 2022 | 24,814,855 | ||||
Ending balance at Jun. 30, 2022 | $ 52,902 | $ 25 | 502,250 | (1,451) | (447,922) |
Beginning balance (in shares) at Dec. 31, 2022 | 25,045,751 | 25,045,751 | |||
Beginning balance at Dec. 31, 2022 | $ 34,777 | $ 25 | 506,713 | (1,108) | (470,853) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (10,375) | (10,375) | |||
Unrealized loss adjustment for short-term investment | 1,108 | 1,108 | |||
Issuance of common stock pursuant to stock option exercises (in shares) | 17,608 | ||||
Issuance of common stock pursuant to stock option exercises | 1 | 1 | |||
Issuance of common stock upon vesting of restricted stock units (in shares) | 325,747 | ||||
Issuance of common stock upon vesting of restricted stock units | 0 | ||||
Shares withheld for taxes (in shares) | (35,562) | ||||
Shares withheld for taxes | (146) | (146) | |||
Repurchase of common stock (in shares) | (1,340) | ||||
Repurchase of common stock | 0 | ||||
Stock-based compensation | 2,125 | 2,125 | |||
Ending balance (in shares) at Mar. 31, 2023 | 25,352,204 | ||||
Ending balance at Mar. 31, 2023 | $ 27,490 | $ 25 | 508,693 | 0 | (481,228) |
Beginning balance (in shares) at Dec. 31, 2022 | 25,045,751 | 25,045,751 | |||
Beginning balance at Dec. 31, 2022 | $ 34,777 | $ 25 | 506,713 | (1,108) | (470,853) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (19,499) | ||||
Unrealized loss on available-for-sale debt securities | $ 0 | ||||
Issuance of common stock pursuant to stock option exercises (in shares) | 181,742 | ||||
Ending balance (in shares) at Jun. 30, 2023 | 25,816,929 | 25,816,929 | |||
Ending balance at Jun. 30, 2023 | $ 21,226 | $ 26 | 511,552 | 0 | (490,352) |
Beginning balance (in shares) at Mar. 31, 2023 | 25,352,204 | ||||
Beginning balance at Mar. 31, 2023 | 27,490 | $ 25 | 508,693 | 0 | (481,228) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (9,124) | (9,124) | |||
Unrealized loss on available-for-sale debt securities | 0 | ||||
Issuance of common stock pursuant to stock option exercises | 5 | ||||
Stock issued during period, value, employee stock purchase plan | 240 | ||||
Issuance of common stock upon vesting of restricted stock units | 0 | ||||
Shares withheld for taxes | (41) | ||||
Change in early exercise liability | 1 | ||||
Stock-based compensation | $ 2,655 | ||||
Ending balance (in shares) at Jun. 30, 2023 | 25,816,929 | 25,816,929 | |||
Ending balance at Jun. 30, 2023 | $ 21,226 | $ 26 | $ 511,552 | $ 0 | $ (490,352) |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash flows from operating activities | ||
Net loss | $ (19,499) | $ (24,151) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Stock-based compensation expense | 4,780 | 4,091 |
Depreciation | 96 | 153 |
Amortization of debt discount and issuance costs | 133 | 128 |
Non-cash interest expense | 494 | 411 |
PIK interest incurred but not paid on term loan | 1,314 | 632 |
Amortization of right-of-use asset | 702 | 1,343 |
Loss on short-term investments | 695 | 109 |
Inventory write-downs | 88 | 169 |
Changes in operating assets and liabilities | ||
Accounts receivable | (3,395) | (1,384) |
Inventory | (389) | (766) |
Prepaid expenses and other assets | 1,061 | (841) |
Accounts payable | (215) | 93 |
Accrued liabilities | 769 | (468) |
Operating lease liabilities | (692) | (1,570) |
Net cash (used in) operating activities | (14,058) | (22,051) |
Cash flows from investing activities | ||
Acquisition of property and equipment | (132) | (470) |
Proceeds from sale of short-term investments | 15,500 | 8,400 |
Net cash provided by investing activities | 15,368 | 7,930 |
Cash flows from financing activities | ||
Proceeds from issuance of common stock under employee plans | 246 | 683 |
Taxes withheld and paid related to net share settlement of equity awards | (187) | (47) |
Payment of deferred offering costs | (119) | 0 |
Net cash (used in) provided by financing activities | (60) | 636 |
Net increase (decrease) in cash and cash equivalents | 1,250 | (13,485) |
Cash, cash equivalents and restricted cash | ||
Beginning of the period | 6,727 | 19,309 |
End of the period | 7,977 | 5,824 |
Reconciliation of cash, cash equivalents and restricted cash to balance sheets: | ||
Cash and cash equivalents | 7,855 | 5,702 |
Restricted cash | 122 | 122 |
Cash, cash equivalents and restricted cash in balance sheets | 7,977 | 5,824 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 2,148 | 2,510 |
Supplemental disclosures of non-cash investing and financing information: | ||
Net change in accrued liabilities from early exercise of options | (1) | (3) |
Purchase of property and equipment included in accounts payable | $ 0 | $ 31 |
The Company
The Company | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
The Company | The Company NeuroPace, Inc., or the Company, was incorporated in the state of Delaware on November 19, 1997. The Company is a commercial-stage medical device company that has developed the RNS System, the only commercially available brain-responsive neuromodulation system designed for treating medically refractory focal epilepsy by delivering personalized, real-time treatment at the seizure source. The Company began commercializing its products in the United States in 2014. Initial Public Offering On April 21, 2021, the Company’s registration statement on Form S-1 (File No. 333-254663) relating to its initial public offering, or IPO, of common stock became effective. The IPO closed on April 26, 2021, at which time the Company issued 6,900,000 shares of its common stock at a price of $17.00 per share, which included the issuance of shares in connection with the exercise by the underwriters of their option to purchase up to 900,000 additional shares. The Company received an aggregate of $117.3 million in gross proceeds, before underwriting discounts and commissions and offering costs, and approximately $105.5 million in net proceeds after deducting $8.2 million in underwriting discounts and commissions and $3.6 million in offering costs. At-the-Market Equity Offering In November 2022, the Company filed a Registration Statement on Form S-3, or Shelf, with the Securities and Exchange Commission in relation to the registration of common stock, preferred stock, debt securities, warrants or any combination thereof for up to an aggregate of $150.0 million, of which $50.0 million may be issued and sold pursuant to an at-the-market, or ATM, offering program for sales of the Company’s common stock under a sales agreement, or Sales Agreement, with SVB Securities LLC, or SVB. The Company agreed to pay SVB up to 3.0% of the gross proceeds of sales of common stock made through the Sales Agreement. The Company’s common stock would be sold at prevailing market prices at the time of the sale and, as a result, prices may vary. The Company has not issued or sold any securities pursuant to the Shelf or ATM offering program. Liquidity and Capital Resources The Company has incurred operating losses and negative cash flows from operations since its inception and has an accumulated deficit of $490.4 million as of June 30, 2023. For the six months ended June 30, 2023 and 2022, the Company used $14.1 million and $22.1 million of cash, respectively, in its operating activities. As of June 30, 2023, the Company had cash, cash equivalents and short-term investments of $63.6 million. Historically, the Company has funded its operations principally through the sales of its products, issuance of redeemable convertible preferred stock and debt financing. The Company’s condensed financial statements have been prepared on the basis of the Company continuing as a going concern for the next 12 months. Management believes that the Company’s cash, cash equivalents and short-term investments will allow the Company to continue its planned operations for at least the next 12 months from the date of the issuance of these unaudited interim condensed financial statements. In connection with the Term Loan described in Note 6, the Company will need to be in compliance with a minimum annual net revenue covenant determined in accordance with generally accepted accounting principles of $45.0 million in the year ended December 31, 2023, and maintain a minimum cash and cash equivalents balance of $5.0 million . If the Company cannot generate sufficient revenue in the future, the Company may not be in compliance with the annual net revenue covenant and the lender may call the debt resulting in the Company immediately needing additional capital, and resulting in a going concern. The Company’s ability to raise additional capital may be adversely impacted by global economic conditions and the recent disruptions to, and volatility in, the financial markets in the United States and worldwide. If the Company is unable to raise capital when needed, it will need to delay, limit, reduce or terminate planned commercialization or product development activities in order to reduce costs. As of June 30, 2023 , the Company was in compliance with all covenants of the Term Loan. The global spread of COVID-19, including the different COVID-19 variants and measures introduced by local, state and federal governments to contain COVID-19 and mitigate its public health effects, have significantly impacted the global economy and negatively impacted the Company’s business. Beginning in March 2020, the Company’s net sales were negatively impacted by the COVID-19 pandemic as hospitals delayed or canceled elective procedures. The decrease in hospital admission rates and elective surgeries reduced both the number of patients being evaluated for treatment with and demand for elective procedures using the Company's RNS System. By the second half of 2022, the impact of the pandemic on the Company’s revenue had diminished. However, the future impact of COVID-19 on the Company’s business, financial condition and results of operations is dependent on future developments, including the potential emergence of new COVID-19 variants and spikes in COVID-19 cases, which remain highly uncertain and cannot be predicted. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The unaudited interim condensed financial statements have been prepared in conformity with generally accepted accounting principles in the United States, or GAAP, as defined by the Financial Accounting Standards Board, or the FASB. Unaudited Interim Financial Information The condensed balance sheet as of December 31, 2022 was derived from the Company’s audited financial statements, but does not include all disclosures required by GAAP. The accompanying unaudited condensed financial statements as of June 30, 2023 and for the three and six months ended June 30, 2023 and 2022, have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC, for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, the Company believes that the disclosures are adequate to make the information presented not misleading. Accordingly, these financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2022 and notes thereto, which are included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the SEC on March 2, 2023. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s condensed financial position as of June 30, 2023 and condensed results of operations for the three and six months ended June 30, 2023 and 2022 and condensed cash flows for the six months ended June 30, 2023 and 2022 have been made. The results of operations for the three and six months ended June 30, 2023 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2023. Use of Estimates The preparation of unaudited interim condensed financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements. The Company uses significant judgment when making estimates related to the valuation of deferred tax assets and related valuation allowances and provision for excess and obsolete inventories. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. 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. Fair Value of Financial Instruments Carrying amounts of certain of the Company’s financial instruments, including cash equivalents, accounts receivable, accounts payable and accrued liabilities, approximate fair value because of the short-term nature of these instruments. The Company has a short-term investment in a fixed income mutual fund, which is classified as equity security and carried at fair value based on quoted market prices. Changes in the fair value of the short-term investment are recorded in income or loss. The Company believes that its borrowings bear interest at the prevailing market rates for instruments with similar characteristics; accordingly, the carrying value of this instrument approximates its fair value. The Company determines the fair value of financial and non-financial assets and liabilities using the fair value hierarchy which establishes three levels of inputs that may be used to measure fair value (see Note 3). Concentration of Credit Risk, and Other Risks and Uncertainties Financial instruments that potentially subject the Company to credit risk consist of cash and cash equivalents, short-term investments and accounts receivable to the extent of the amounts recorded on the balance sheets. The Company’s cash is invested in major financial institutions in the United States. Deposits in these financial institutions may exceed federally insured limits, and the Company is exposed to credit risk on deposits in the event of default of the financial institutions to the extent account balances exceed the amount insured by the Federal Deposit Insurance Corporation. The Company’s cash equivalents are invested in money market funds. The Company’s accounts receivable are due from a variety of health care organizations in the United States. For the three and six months ended June 30, 2023 and 2022, there were no customers that represented 10% or more of revenue. As of June 30, 2023 and December 31, 2022, no customer represented 10% or more of the Company’s accounts receivable. The Company is subject to certain risks, including that its devices may not be approved or cleared or continue to be approved or cleared for marketing by governmental authorities or be successfully marketed for expanded indications. There can be no assurance that the Company’s products will achieve widespread adoption in the marketplace, nor can there be any assurance that existing devices or any future devices can be developed or manufactured at an acceptable cost and speed and with appropriate performance characteristics. The Company is also subject to risks common to companies in the medical device industry, including, but not limited to, new technological innovations, dependence on healthcare providers to prescribe initial implants and replacements, dependence upon third-party payors to provide adequate coverage and reimbursement, dependence on key personnel, single-source suppliers and vendors in connection with the manufacture of its products, concentration of CECs and epileptologists, obtaining, maintaining, protecting, enforcing, and defending intellectual property rights and proprietary technology, product liability claims, legal proceedings, and compliance with government regulations. The Company’s medical devices require approvals or clearances from the U.S. Food and Drug Administration, or the FDA, or international regulatory agencies. In addition, in order to continue the Company’s operations, compliance with various federal and state laws is required. If approvals or clearances were withdrawn by the FDA for the Company’s current products or if such approvals or clearances were denied or delayed for future products, product updates, or expanded indications for use, it would have a material adverse impact on the Company. Accounts Receivable Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company makes estimates on the collectability of customer accounts based primarily on analysis of historical trends and experience, the age of the receivable and changes in customers’ financial condition. The Company uses its judgment, based on the best available facts and circumstances, and records an allowance against amounts due to reduce the receivable to the amount that is expected to be collected. The Company determined that no allowance was required as of June 30, 2023 and December 31, 2022. To date, the Company has not experienced any credit-related losses. Government Programs In May 2021, the Company was awarded a grant by the National Institutes of Health, or NIH, to support research of thalamocortical responsive neurostimulation for the treatment of Lennox-Gastaut Syndrome, a type of epilepsy. The award was issued for a five-year period and has a total budget of over $9.3 million, which includes approximately $5.5 million in funding for subawards to third party academic epilepsy centers that are collaborating on the study and are subinvestigators on the study funded by NIH. The subawardees are determined by NIH. The Company’s responsibility for the subawards is to submit the funding requests on behalf of the subawardees. The funding of subawards does not have any impact on the Company’s condensed financial statements. Initially funding was approved for the first year beginning June 1, 2021 and provides for reimbursement of qualified direct and indirect expenses in the amount of $0.8 million, including $0.4 million for subawards. Approvals of funds for years two through five are subject to the completion of certain milestones. On July 30, 2022, the Company received funding approval for year two in the amount of $2.6 million, which includes $1.6 million for subawards. On May 25, 2023, the Company received funding approval for year three in the amount of $3.0 million, which includes $1.5 million for subawards. For funds received under the NIH funding agreement, the Company recognizes a reduction in research and development expenses in an amount equal to the qualifying expenses incurred in each period up to the amount awarded by the NIH. Qualifying expenses incurred by the Company in advance of funding by the NIH are recorded within prepaid expenses and other current assets on the balance sheets. Through June 30, 2023, $1.2 million of qualifying expenses have been incurred and funded by the NIH related to the first and second year funding. As of June 30, 2023, the Company recorded prepaid expenses and other current assets of $0.1 million related to the third year funding. Net Loss per Share Attributable to Common Stockholders Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period, without consideration of 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 shares of common stock and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, stock options, common stock subject to repurchase related to early exercise of stock options, and restricted stock units are considered to be potentially dilutive securities. Basic and diluted net loss attributable to common stockholders per share is presented in conformity with the two-class method required for participating securities. The Company considers the shares issued upon the early exercise of stock options subject to repurchase to be participating securities, because holders of such shares have non-forfeitable dividend rights in the event a dividend is paid on common stock. The holders of the shares issued upon early exercise of stock options subject to repurchase do not have a contractual obligation to share in the Company’s losses. As such, the net loss was attributed entirely to common stockholders. Because the Company has reported a net loss for all periods presented, diluted net loss per common share is the same as basic net loss per common share for those periods. Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which amends existing guidance on the impairment of financial assets and adds an impairment model that is based on expected losses rather than incurred losses and requires an entity to recognize as an allowance its estimate of expected credit losses for its financial assets. An entity will apply this guidance through a cumulative-effect adjustment to retained earnings upon adoption (a modified-retrospective approach) while a prospective transition approach is required for debt securities for which an other-than-temporary impairment had been recognized before the effective date. For public business entities that meet the definition of an SEC filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, adoption is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For SEC filers that are eligible to be smaller reporting companies and for all other entities, this ASU is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The Company adopted this ASU effective January 1, 2023. The adoption of this ASU did not have a material effect on the Company’s financial statements and related disclosures. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value MeasurementsThe Company measures certain financial assets and liabilities at fair value on a recurring basis. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value: 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. The Company utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The following table summarizes the Company’s financial assets (cash equivalents and marketable securities) at fair value as of June 30, 2023 (in thousands): Fair Value as of June 30, 2023 Basis for Fair Value Measurements (Level 1) (Level 2) (Level 3) Assets: Money market funds, included in cash and cash equivalents $ 7,534 $ 7,534 $ — $ — Fixed income mutual fund, included in short-term investments 55,716 55,716 — — Total $ 63,250 $ 63,250 $ — $ — The following table summarizes the Company’s financial assets (cash equivalents and marketable securities) at fair value as of December 31, 2022 (in thousands): Fair Value as of December 31, 2022 Basis for Fair Value Measurements (Level 1) (Level 2) (Level 3) Assets: Money market funds, included in cash and cash equivalents $ 6,075 $ 6,075 $ — $ — Fixed income mutual fund, included in short-term investments 70,804 70,804 — — Total $ 76,879 $ 76,879 $ — $ — There were no liabilities measured at fair value on a recurring and non-recurring basis as of June 30, 2023 and December 31, 2022. The money market funds are highly liquid and primarily invest in short-term fixed income securities issued by the U.S. government and U.S. government agencies. The Company’s available-for-sale investment comprises a short-term investment in a fixed income mutual fund, which primarily invests in debt securities issued by the U.S. government and U.S. government agencies and corporate bonds and notes. Interest income from its short-term investment is recorded in interest income. As of December 31, 2022, the Company’s short-term investment had a fair value of $70.8 million, a cost basis of $71.9 million, and an unrealized loss of $1.1 million, which was recorded in accumulated other comprehensive loss. During the three and six months ended June 30, 2023, the Company recognized $0.1 million and $0.6 million in unrealized gains, respectively, from its short-term investment. As of June 30, 2023, the Company’s short-term investment had a cumulative unrealized net loss of $0.5 million, which included an adjustment of $1.1 million |
Balance Sheet Components
Balance Sheet Components | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Components | Balance Sheet Components Inventory Inventories consist of the following (in thousands): June 30, December 31, 2023 2022 Raw materials $ 3,600 $ 2,818 Work-in-process 789 1,523 Finished goods 5,625 5,371 Total $ 10,014 $ 9,712 Property and Equipment, net Property and equipment, net consists of the following (in thousands): June 30, December 31, 2023 2022 Machinery, equipment, furniture and fixtures $ 4,443 $ 4,434 Computer equipment and software 2,952 2,952 Leasehold improvements 2,402 2,402 9,797 9,788 Less: Accumulated depreciation (8,821) (8,724) Property and equipment, net $ 976 $ 1,064 Depreciation expense for the three months ended June 30, 2023 and 2022 was less than $0.1 million and $0.1 million, respectively. Depreciation expense for the six months ended June 30, 2023 and 2022 was $0.1 million and $0.2 million, respectively. Accrued Liabilities Accrued liabilities consist of the following (in thousands): June 30, December 31, 2023 2022 Payroll and related expenses $ 6,637 $ 5,748 Inventory-raw materials 550 764 Professional fees 366 227 Other 629 675 Total accrued liabilities $ 8,182 $ 7,414 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Facility Lease In August 2011, the Company entered into a non-cancelable operating lease for combined office and manufacturing facilities in Mountain View, California. The lease was scheduled to expire in April 2019 and was amended in May 2018 to extend it through June 2024. In August 2022, the Company amended the lease to extend it through June 2030. The second amendment contained a rent free period from September 2022 through December 2022. The Company has an option to extend the lease for a period of five years, commencing on July 1, 2030 and expiring on June 30, 2035. In conjunction with the original lease agreement, the Company obtained a letter of credit for $0.9 million in lieu of a security deposit. In May 2019, the letter of credit was amended and reduced to $0.7 million. In June 2021, the letter of credit was amended and further reduced to $0.2 million. The terms of the facility lease provide for rental payments on a graduated scale; however, rent expense is recognized on a straight-line basis over the lease term. Rental payments range from $2.8 million to $3.3 million per year over the extended term of the lease. The maturities of operating lease liabilities as of June 30, 2023 are as follows (in thousands): June 30, 2023 (remaining six months) $ 1,387 2024 2,857 2025 2,942 2026 3,031 2027 3,122 Thereafter 8,232 Total undiscounted lease payments 21,571 Less: imputed interest 5,408 Total operating lease liability 16,163 Less: current portion 1,519 Operating lease liability, net of current portion $ 14,644 Operating lease cost was $0.7 million and $0.7 million for the three months ended June 30, 2023 and 2022, respectively. Operating lease cost was $1.4 million and $1.3 million for the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023, the remaining term for the operating lease in Mountain View, California was 7.0 years, and the discount rate used to measure the lease liability for such operating lease upon recognition was 8.5%. During the six months ended June 30, 2023 and 2022, cash paid for amounts included in operating lease liabilities of $1.4 million and $1.6 million, respectively, was included in cash flows from operating activities on the condensed statements of cash flows. Distribution Agreement In August 2022, the Company entered into an exclusive distribution agreement, or the Distribution Agreement, with DIXI Medical USA Corp, or DIXI Medical, pursuant to which the Company became the exclusive U.S. distributor of DIXI Medical’s product line. To maintain the exclusive distributor rights, the Company is committed to purchase a minimum of $2.4 million of DIXI Medical’s products during the twelve months beginning October 2022, and increase the purchase minimum by 10% for each of the two subsequent years. Indemnifications In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and may provide for indemnification of the counterparty. The Company’s exposure under these agreements is unknown because it involves claims that may be made against it in the future but have not yet been made. The Company may, from time to time, be subject to claims or be required to defend actions related to its indemnification obligations. The Company indemnifies each of its directors and officers for certain events or occurrences, subject to certain limits, while the director or officer is or was serving at the Company’s request in such capacity, as permitted under Delaware law and in accordance with its certificate of incorporation and bylaws. The term of the indemnification period lasts as long as the director or officer may be subject to any proceeding arising out of acts or omissions of such individual in such capacity. The maximum amount of potential future indemnification is unlimited. The Company believes that the fair value of these indemnification obligations is minimal. Accordingly, the Company has not recognized any liabilities relating to these obligations as of June 30, 2023 and December 31, 2022. Contingencies From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business activities. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. The Company determined that no accrual related to contingencies was required as of June 30, 2023 and December 31, 2022. Legal Proceedings The Company is not involved in any pending legal proceedings that it believes could have a material adverse effect on its business, results of operations, financial condition, or cash flows. From time to time, the Company may pursue litigation to assert its legal rights and such litigation may be costly and divert the efforts and attention of its management and technical personnel which could adversely affect its business. The Company regularly evaluates current information to determine whether any accruals should be adjusted and whether new accruals are required. Such accruals, if any, reflect the estimable and probable costs that the Company may incur from the outcomes of its legal proceedings. Legal costs are expensed as incurred. There were no contingent liabilities requiring accrual as of June 30, 2023 and December 31, 2022. |
Debt
Debt | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Debt Term Loan In September 2020, the Company entered into a Term Loan Agreement with CRG Partners IV L.P. and its affiliates for total borrowings of up to $60.0 million, or the Term Loan, and borrowed $50.0 million. The remaining $10.0 million of the Term Loan was available to the Company for borrowing until March 31, 2022 if the Company achieved a revenue-based milestone in 2021. The revenue-based milestone was not achieved, and the remaining $10.0 million of the Term Loan expired without being drawn. The Term Loan bore interest at a rate of 12.5% per year. In February 2023, the Term Loan was amended which increased the annual interest rate from 12.5% to 13.5% effective March 1, 2023. The amendment was accounted as a debt modification and the Term Loan’s effective interest rate increased from 15.7% to 16.8%. Payments under the Term Loan are made quarterly with payment dates fixed at the end of each calendar quarter. Through December 2020, the Company had the option to pay the entire interest paid-in-kind, or PIK, by increasing the principal of the Term Loan. From January 2021 through December 2022, the Company had the option to pay interest as follows: 7.5% per annum paid in cash and 5.0% per annum PIK by increasing the principal of the Term Loan. From January 2023 through June 2025, the Company has the option to pay interest as follows: 8.5% per annum paid in cash and 5.0% per annum PIK by increasing the principal of the Term Loan. For each payment date from April 2022 through June 2023, the Company elected the PIK option, increasing the principal of the Term Loan by $3.2 million. The Term Loan was interest-only through September 2023, which could be extended through September 2025 at the Company’s option if the Company completed its IPO on or prior to September 30, 2023. In connection with closing the IPO, the Company extended the interest-only period to September 30, 2025. Following the interest-only period, principal payment is due in one installment on September 30, 2025. The Term Loan includes a fee upon repayment of the loan equal to 10% of the aggregate principal amount being prepaid or repaid, or the backend fee. As of June 30, 2023, the Term Loan had an annual effective interest rate of 16.8% per year. The Term Loan is collateralized by substantially all of the Company’s assets. The Term Loan Agreement contains customary representations and warranties, covenants, events of default and termination provisions. The financial covenants require that the Company achieve minimum annual revenue thresholds commencing in 2021 and maintain a minimum balance of cash and cash equivalents (see Note 1). In February 2023, the Term Loan was amended to reduce the minimum annual net revenue covenant to $45.0 million for the year ended December 31, 2023. The Company paid $1.0 million in fees to the lender and third parties which is reflected as a discount on the loan and is being accreted over the life of the loan using the effective interest method. Also, the Company issued warrants to the lender for a total of 346,823 shares of Series B’ redeemable convertible preferred stock. The warrants had a fair value of $0.6 million as of the issuance date, which was accounted for as debt issuance costs. During the three months ended June 30, 2023 and 2022, the Company recorded interest expense related to debt discount and debt issuance costs of the Term Loan of $0.1 million and $0.1 million, respectively. During the six months ended June 30, 2023 and 2022, the Company recorded interest expense related to debt discount and debt issuance costs of the Term Loan of $0.1 million and $0.1 million, respectively. Interest expense on the Term Loan was $2.1 million and $1.9 million during the three months ended June 30, 2023 and 2022, respectively. Interest expense on the Term Loan was $4.1 million and $3.7 million during the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023, future minimum payments for the Term Loan are as follows (in thousands): Term Loan 2023 (remaining six months) $ 3,674 2024 7,308 2025 64,024 Total 75,006 Less: Unamortized debt discount and issuance cost (770) Less: Unaccreted backend fee (2,948) Less: Interest (16,434) Term Loan $ 54,854 |
Common Stock
Common Stock | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
Common Stock | Common Stock The Company’s Amended and Restated Certificate of Incorporation authorizes the Company to issue 200,000,000 shares of $0.001 par value common stock. The holders of common stock are entitled to receive dividends whenever funds and assets are legally available and when declared by the Board of Directors. As of June 30, 2023 and December 31, 2022, no dividends had been declared. As of June 30, 2023 and December 31, 2022, the Company had reserved common stock for future issuance as follows: June 30, December 31, 2023 2022 Shares available for future grant under the 2021 Plan 841,592 1,443,946 Outstanding options under the 2021 Plan 3,457,501 3,446,583 Outstanding restricted stock units under the 2021 Plan 2,992,124 1,756,209 Common stock available for ESPP 515,687 429,940 Total 7,806,904 7,076,678 |
Stock-Based Incentive Compensat
Stock-Based Incentive Compensation Plans | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Incentive Compensation Plans | Stock-Based Incentive Compensation PlansA summary of shares available for grant under the Company’s 2021 Equity Incentive Plan, or the 2021 Plan, is as follows: Shares Available for Grant Shares available for grant as of January 1, 2023 1,443,946 Authorized 1,252,287 Granted/Awarded (2,238,980) Cancelled 338,871 Withheld for taxes 45,468 Shares available for grant as of June 30, 2023 841,592 A summary of stock option activity for the six months ended June 30, 2023 is set forth below: Options Outstanding Number of Shares Weighted-Average Exercise Price Weighted Average Remaining Contractual Term (in Years) Balances as of January 1, 2023 3,446,583 $ 3.61 8.06 Granted 314,801 $ 3.21 Exercised (181,742) $ 0.03 Cancelled (122,141) $ 4.07 Balances at June 30, 2023 3,457,501 $ 3.75 5.21 Vested and exercisable at June 30, 2023 2,057,141 $ 3.03 4.81 Vested and expected to vest at June 30, 2023 3,457,501 $ 3.75 5.21 Early Exercise of Stock Options The terms of the Company’s 2020 Stock Plan, or the 2020 Plan, and the 2021 Plan, permit the exercise of options granted under the plans prior to vesting, subject to required approvals. The shares of common stock issued from the early exercise of unvested stock options are restricted and continue to vest over the original implied service period. The Company has the option to repurchase any unvested shares at the original purchase price upon any voluntary or involuntary termination. The shares purchased by the employees and non-employees pursuant to the early exercise of stock options are not deemed, for accounting purposes, to be outstanding until those shares vest. The cash received in exchange for exercised and unvested shares related to stock options granted is recorded as a liability for the early exercise of stock options in accrued liabilities on the accompanying balance sheet and will be transferred into common stock and additional paid-in capital as the shares vest. As of June 30, 2023 and December 31, 2022, there were 53,599 and 78,389 shares of common stock, respectively, issued pursuant to early exercised options and subject to repurchase. Employee Stock Purchase Plan In April 2021, the Company adopted the 2021 Employee Stock Purchase Plan, or ESPP. The Company allows eligible employees to purchase shares of the Company's common stock through payroll deductions at a price equal to 85% of the lesser of the fair market value of the stock as of the first date or the ending date of each offering period, which is typically six months. There were 580,000 shares of common stock initially reserved for issuance under the ESPP. In January 2023, the number of shares of common stock available for issuance under the ESPP was increased by 250,457 shares as a result of the automatic increase provision in the ESPP. As of June 30, 2023, 515,687 shares under the ESPP remain available for purchase. The Company issued 164,710 and 147,217 shares under the ESPP during the six months ended June 30, 2023 and 2022, respectively. The offering period and purchase period is determined by the board of directors. A new offering period of six months has been authorized beginning June 7, 2023 through December 6, 2023. Restricted Stock Units Activity with respect to restricted stock units was as follows: Number of Shares Underlying Outstanding Restricted Stock Units Weighted Average Grant Date Fair Value Unvested, January 1, 2023 1,756,209 $ 10.15 Granted 1,924,179 $ 4.60 Vested (471,534) $ 9.70 Cancelled (216,730) $ 8.72 Unvested, June 30, 2023 2,992,124 $ 6.76 Stock-Based Compensation The Company recognized stock-based compensation as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Cost of goods sold $ 148 $ 163 $ 294 $ 273 Research and development 733 748 1,233 1,188 Selling, general and administrative 1,774 1,692 3,253 2,630 Total stock-based compensation $ 2,655 $ 2,603 $ 4,780 $ 4,091 The above stock-based compensation expense related to the following equity-based awards (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Stock options and restricted stock units $ 2,606 $ 2,491 $ 4,677 $ 3,843 ESPP 49 112 103 248 Total stock-based compensation $ 2,655 $ 2,603 $ 4,780 $ 4,091 As of June 30, 2023, the total unrecognized stock-based compensation expense related to unvested stock options and restricted stock units was $19.0 million, which will be amortized on a straight-line basis over a weighted average remaining period of 2.5 years. As of June 30, 2023, the Company had unrecognized stock-based compensation expense relating to the ESPP awards of $0.1 million, which is expected to be recognized over a weighted-average period of 0.4 years. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company did not record a federal or state income tax provision or benefit for the three and six months ended June 30, 2023 and 2022 as it has incurred net losses since inception. In addition, the net deferred tax assets generated from net operating losses are fully offset by a valuation allowance as the Company believes it is not more likely than not that the benefit will be realized. The Company accounts for the uncertainty in income taxes by utilizing a comprehensive model for the recognition, measurement, presentation and disclosure in financial statements of any uncertain tax positions that have been taken or are expected to be taken on an income tax return. There has been no changes in the estimated uncertain tax benefits recorded as of December 31, 2022. |
Net Loss per Share Attributable
Net Loss per Share Attributable to Common Stockholders | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net Loss per Share Attributable to Common Stockholders | Net Loss per Share Attributable to Common Stockholders The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except for share and per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Numerator: Net loss attributable to common stockholders $ (9,124) $ (12,690) $ (19,499) $ (24,151) Denominator: Weighted-average common stock outstanding used to compute basic and diluted net loss per share 25,472,526 24,503,552 25,285,933 24,406,100 Net loss per share attributable to common stockholders, basic and diluted $ (0.36) $ (0.52) $ (0.77) $ (0.99) The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted average shares outstanding because such securities have an antidilutive impact due to the Company’s net loss, in common stock equivalent shares: As of June 30, 2023 2022 Options to purchase common stock 3,457,501 3,547,590 Unvested early exercised common stock options 53,599 125,726 Shares committed under ESPP 110,968 141,864 Unvested restricted stock units 2,992,124 1,863,026 Total Shares 6,614,192 5,678,206 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Unaudited Interim Financial Information | Basis of Presentation The unaudited interim condensed financial statements have been prepared in conformity with generally accepted accounting principles in the United States, or GAAP, as defined by the Financial Accounting Standards Board, or the FASB. Unaudited Interim Financial Information The condensed balance sheet as of December 31, 2022 was derived from the Company’s audited financial statements, but does not include all disclosures required by GAAP. The accompanying unaudited condensed financial statements as of June 30, 2023 and for the three and six months ended June 30, 2023 and 2022, have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC, for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, the Company believes that the disclosures are adequate to make the information presented not misleading. Accordingly, these financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2022 and notes thereto, which are included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the SEC on March 2, 2023. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s condensed financial position as of June 30, 2023 and condensed results of operations for the three and six months ended June 30, 2023 and 2022 and condensed cash flows for the six months ended June 30, 2023 and 2022 have been made. The results of operations for the three and six months ended June 30, 2023 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2023. |
Use of Estimates | Use of Estimates The preparation of unaudited interim condensed financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements. The Company uses significant judgment when making estimates related to the valuation of deferred tax assets and related valuation allowances and provision for excess and obsolete inventories. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. 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. |
Fair Value of Financial Instruments and Fair Value Measurements | Fair Value of Financial Instruments Carrying amounts of certain of the Company’s financial instruments, including cash equivalents, accounts receivable, accounts payable and accrued liabilities, approximate fair value because of the short-term nature of these instruments. The Company has a short-term investment in a fixed income mutual fund, which is classified as equity security and carried at fair value based on quoted market prices. Changes in the fair value of the short-term investment are recorded in income or loss. The Company believes that its borrowings bear interest at the prevailing market rates for instruments with similar characteristics; accordingly, the carrying value of this instrument approximates its fair value. The Company determines the fair value of financial and non-financial assets and fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value: 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. The Company utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. |
Concentration of Credit Risk, and Other Risks and Uncertainties | Concentration of Credit Risk, and Other Risks and Uncertainties Financial instruments that potentially subject the Company to credit risk consist of cash and cash equivalents, short-term investments and accounts receivable to the extent of the amounts recorded on the balance sheets. The Company’s cash is invested in major financial institutions in the United States. Deposits in these financial institutions may exceed federally insured limits, and the Company is exposed to credit risk on deposits in the event of default of the financial institutions to the extent account balances exceed the amount insured by the Federal Deposit Insurance Corporation. The Company’s cash equivalents are invested in money market funds. The Company’s accounts receivable are due from a variety of health care organizations in the United States. For the three and six months ended June 30, 2023 and 2022, there were no customers that represented 10% or more of revenue. As of June 30, 2023 and December 31, 2022, no customer represented 10% or more of the Company’s accounts receivable. The Company is subject to certain risks, including that its devices may not be approved or cleared or continue to be approved or cleared for marketing by governmental authorities or be successfully marketed for expanded indications. There can be no assurance that the Company’s products will achieve widespread adoption in the marketplace, nor can there be any assurance that existing devices or any future devices can be developed or manufactured at an acceptable cost and speed and with appropriate performance characteristics. The Company is also subject to risks common to companies in the medical device industry, including, but not limited to, new technological innovations, dependence on healthcare providers to prescribe initial implants and replacements, dependence upon third-party payors to provide adequate coverage and reimbursement, dependence on key personnel, single-source suppliers and vendors in connection with the manufacture of its products, concentration of CECs and epileptologists, obtaining, maintaining, protecting, enforcing, and defending intellectual property rights and proprietary technology, product liability claims, legal proceedings, and compliance with government regulations. The Company’s medical devices require approvals or clearances from the U.S. Food and Drug Administration, or the FDA, or international regulatory agencies. In addition, in order to continue the Company’s operations, compliance with various federal and state laws is required. If approvals or clearances were withdrawn by the FDA for the Company’s current products or if such approvals or clearances were denied or delayed for future products, product updates, or expanded indications for use, it would have a material adverse impact on the Company. |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company makes estimates on the collectability of customer accounts based primarily on analysis of historical trends and experience, the age of the receivable and changes in customers’ financial condition. The Company uses its judgment, based on the best available facts and circumstances, and records an allowance against amounts due to reduce the receivable to the amount that is expected to be collected. The Company determined that no allowance was required as of June 30, 2023 and December 31, 2022. To date, the Company has not experienced any credit-related losses. |
Government Programs | Government Programs In May 2021, the Company was awarded a grant by the National Institutes of Health, or NIH, to support research of thalamocortical responsive neurostimulation for the treatment of Lennox-Gastaut Syndrome, a type of epilepsy. The award was issued for a five-year period and has a total budget of over $9.3 million, which includes approximately $5.5 million in funding for subawards to third party academic epilepsy centers that are collaborating on the study and are subinvestigators on the study funded by NIH. The subawardees are determined by NIH. The Company’s responsibility for the subawards is to submit the funding requests on behalf of the subawardees. The funding of subawards does not have any impact on the Company’s condensed financial statements. Initially funding was approved for the first year beginning June 1, 2021 and provides for reimbursement of qualified direct and indirect expenses in the amount of $0.8 million, including $0.4 million for subawards. Approvals of funds for years two through five are subject to the completion of certain milestones. On July 30, 2022, the Company received funding approval for year two in the amount of $2.6 million, which includes $1.6 million for subawards. On May 25, 2023, the Company received funding approval for year three in the amount of $3.0 million, which includes $1.5 million for subawards. For funds received under the NIH funding agreement, the Company recognizes a reduction in research and development expenses in an amount equal to the qualifying expenses incurred in each period up to the amount awarded by the NIH. Qualifying expenses incurred by the Company in advance of funding by the NIH are recorded within prepaid expenses and other current assets on the balance sheets. Through June 30, 2023, $1.2 million of qualifying expenses have been incurred and funded by the NIH related to the first and second year funding. As of June 30, 2023, the Company recorded prepaid expenses and other current assets of $0.1 million related to the third year funding. |
Net Loss per Share Attributable to Common Stockholders | Net Loss per Share Attributable to Common Stockholders Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period, without consideration of 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 shares of common stock and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, stock options, common stock subject to repurchase related to early exercise of stock options, and restricted stock units are considered to be potentially dilutive securities. Basic and diluted net loss attributable to common stockholders per share is presented in conformity with the two-class method required for participating securities. The Company considers the shares issued upon the early exercise of stock options subject to repurchase to be participating securities, because holders of such shares have non-forfeitable dividend rights in the event a dividend is paid on common stock. The holders of the shares issued upon early exercise of stock options subject to repurchase do not have a contractual obligation to share in the Company’s losses. As such, the net loss was attributed entirely to common stockholders. Because the Company has reported a net loss for all periods presented, diluted net loss per common share is the same as basic net loss per common share for those periods. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which amends existing guidance on the impairment of financial assets and adds an impairment model that is based on expected losses rather than incurred losses and requires an entity to recognize as an allowance its estimate of expected credit losses for its financial assets. An entity will apply this guidance through a cumulative-effect adjustment to retained earnings upon adoption (a modified-retrospective approach) while a prospective transition approach is required for debt securities for which an other-than-temporary impairment had been recognized before the effective date. For public business entities that meet the definition of an SEC filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, adoption is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For SEC filers that are eligible to be smaller reporting companies and for all other entities, this ASU is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The Company adopted this ASU effective January 1, 2023. The adoption of this ASU did not have a material effect on the Company’s financial statements and related disclosures. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities, Measured at Fair Value | The following table summarizes the Company’s financial assets (cash equivalents and marketable securities) at fair value as of June 30, 2023 (in thousands): Fair Value as of June 30, 2023 Basis for Fair Value Measurements (Level 1) (Level 2) (Level 3) Assets: Money market funds, included in cash and cash equivalents $ 7,534 $ 7,534 $ — $ — Fixed income mutual fund, included in short-term investments 55,716 55,716 — — Total $ 63,250 $ 63,250 $ — $ — The following table summarizes the Company’s financial assets (cash equivalents and marketable securities) at fair value as of December 31, 2022 (in thousands): Fair Value as of December 31, 2022 Basis for Fair Value Measurements (Level 1) (Level 2) (Level 3) Assets: Money market funds, included in cash and cash equivalents $ 6,075 $ 6,075 $ — $ — Fixed income mutual fund, included in short-term investments 70,804 70,804 — — Total $ 76,879 $ 76,879 $ — $ — |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Inventory, Current | Inventories consist of the following (in thousands): June 30, December 31, 2023 2022 Raw materials $ 3,600 $ 2,818 Work-in-process 789 1,523 Finished goods 5,625 5,371 Total $ 10,014 $ 9,712 |
Schedule of Property, Plant and Equipment | Property and equipment, net consists of the following (in thousands): June 30, December 31, 2023 2022 Machinery, equipment, furniture and fixtures $ 4,443 $ 4,434 Computer equipment and software 2,952 2,952 Leasehold improvements 2,402 2,402 9,797 9,788 Less: Accumulated depreciation (8,821) (8,724) Property and equipment, net $ 976 $ 1,064 |
Schedule of Accrued Liabilities | Accrued liabilities consist of the following (in thousands): June 30, December 31, 2023 2022 Payroll and related expenses $ 6,637 $ 5,748 Inventory-raw materials 550 764 Professional fees 366 227 Other 629 675 Total accrued liabilities $ 8,182 $ 7,414 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Maturities of Operating Lease Liabilities | The maturities of operating lease liabilities as of June 30, 2023 are as follows (in thousands): June 30, 2023 (remaining six months) $ 1,387 2024 2,857 2025 2,942 2026 3,031 2027 3,122 Thereafter 8,232 Total undiscounted lease payments 21,571 Less: imputed interest 5,408 Total operating lease liability 16,163 Less: current portion 1,519 Operating lease liability, net of current portion $ 14,644 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Maturities of Long-term Debt | As of June 30, 2023, future minimum payments for the Term Loan are as follows (in thousands): Term Loan 2023 (remaining six months) $ 3,674 2024 7,308 2025 64,024 Total 75,006 Less: Unamortized debt discount and issuance cost (770) Less: Unaccreted backend fee (2,948) Less: Interest (16,434) Term Loan $ 54,854 |
Common Stock (Tables)
Common Stock (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
Schedule of Stock by Class | As of June 30, 2023 and December 31, 2022, the Company had reserved common stock for future issuance as follows: June 30, December 31, 2023 2022 Shares available for future grant under the 2021 Plan 841,592 1,443,946 Outstanding options under the 2021 Plan 3,457,501 3,446,583 Outstanding restricted stock units under the 2021 Plan 2,992,124 1,756,209 Common stock available for ESPP 515,687 429,940 Total 7,806,904 7,076,678 |
Stock-Based Incentive Compens_2
Stock-Based Incentive Compensation Plans (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Available for Grant | A summary of shares available for grant under the Company’s 2021 Equity Incentive Plan, or the 2021 Plan, is as follows: Shares Available for Grant Shares available for grant as of January 1, 2023 1,443,946 Authorized 1,252,287 Granted/Awarded (2,238,980) Cancelled 338,871 Withheld for taxes 45,468 Shares available for grant as of June 30, 2023 841,592 |
Schedule of Stock Option Activity | A summary of stock option activity for the six months ended June 30, 2023 is set forth below: Options Outstanding Number of Shares Weighted-Average Exercise Price Weighted Average Remaining Contractual Term (in Years) Balances as of January 1, 2023 3,446,583 $ 3.61 8.06 Granted 314,801 $ 3.21 Exercised (181,742) $ 0.03 Cancelled (122,141) $ 4.07 Balances at June 30, 2023 3,457,501 $ 3.75 5.21 Vested and exercisable at June 30, 2023 2,057,141 $ 3.03 4.81 Vested and expected to vest at June 30, 2023 3,457,501 $ 3.75 5.21 |
Schedule of Restricted Stock Units | Activity with respect to restricted stock units was as follows: Number of Shares Underlying Outstanding Restricted Stock Units Weighted Average Grant Date Fair Value Unvested, January 1, 2023 1,756,209 $ 10.15 Granted 1,924,179 $ 4.60 Vested (471,534) $ 9.70 Cancelled (216,730) $ 8.72 Unvested, June 30, 2023 2,992,124 $ 6.76 |
Schedule of Share-based Payment Arrangement, Expensed and Capitalized, Amount | The Company recognized stock-based compensation as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Cost of goods sold $ 148 $ 163 $ 294 $ 273 Research and development 733 748 1,233 1,188 Selling, general and administrative 1,774 1,692 3,253 2,630 Total stock-based compensation $ 2,655 $ 2,603 $ 4,780 $ 4,091 The above stock-based compensation expense related to the following equity-based awards (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Stock options and restricted stock units $ 2,606 $ 2,491 $ 4,677 $ 3,843 ESPP 49 112 103 248 Total stock-based compensation $ 2,655 $ 2,603 $ 4,780 $ 4,091 |
Net Loss per Share Attributab_2
Net Loss per Share Attributable to Common Stockholders (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Net Loss Per Share | The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except for share and per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Numerator: Net loss attributable to common stockholders $ (9,124) $ (12,690) $ (19,499) $ (24,151) Denominator: Weighted-average common stock outstanding used to compute basic and diluted net loss per share 25,472,526 24,503,552 25,285,933 24,406,100 Net loss per share attributable to common stockholders, basic and diluted $ (0.36) $ (0.52) $ (0.77) $ (0.99) |
Schedule of Potentially Dilutive Securities Outstanding | The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted average shares outstanding because such securities have an antidilutive impact due to the Company’s net loss, in common stock equivalent shares: As of June 30, 2023 2022 Options to purchase common stock 3,457,501 3,547,590 Unvested early exercised common stock options 53,599 125,726 Shares committed under ESPP 110,968 141,864 Unvested restricted stock units 2,992,124 1,863,026 Total Shares 6,614,192 5,678,206 |
The Company (Details)
The Company (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 6 Months Ended | |||
Apr. 26, 2021 | Nov. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Accumulated deficit | $ 490,352 | $ 470,853 | |||
Net cash used in operating activities | 14,058 | $ 22,051 | |||
Cash, cash equivalents, and short-term investments | 63,600 | ||||
Minimum annual net revenue | 45,000 | ||||
Minimum cash and cash equivalents required after completion of IPO | $ 5,000 | ||||
IPO | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Number of shares issued in transaction (in shares) | 6,900,000 | ||||
Sale of stock (in dollars per share) | $ 17 | ||||
Proceeds from issuance initial public offering | $ 117,300 | ||||
Consideration received on transaction | 105,500 | ||||
Sale of stock, underwriting discounts | 8,200 | ||||
Sale of stock, offering costs | $ 3,600 | ||||
Over-Allotment Option | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Number of shares issued in transaction (in shares) | 900,000 | ||||
At-the-Market Equity Offering | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Number of shares issued in transaction (in shares) | 0 | ||||
Proceeds from issuance of preferred stock, preference stock, and warrants | $ 150,000 | ||||
Proceeds from issuance or sale by company of common stock | $ 50,000 | ||||
Percentage of shares of common stock sold under sales agreement | 3% |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | ||||
May 25, 2023 | Jul. 30, 2022 | Jun. 01, 2021 | May 31, 2021 | Jun. 30, 2023 | Dec. 31, 2022 | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Grant period (in years) | 5 years | |||||
Research and development arrangement with federal government, total budget | $ 9,300 | |||||
Research and development arrangement with federal government, funding for subawards | $ 5,500 | |||||
Approved funding, first year | $ 800 | |||||
Approved funding, including subawards, first year | $ 400 | |||||
Approval for funding, year two | $ 3,000 | $ 2,600 | ||||
Approval for funding, including subawards, year two | $ 1,500 | $ 1,600 | ||||
Prepaid expenses and other current assets | $ 2,050 | $ 3,111 | ||||
Additional Funding Agreement Terms | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Compensation earned | 1,200 | |||||
Prepaid expenses and other current assets | $ 100 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Assets: | ||
Money market funds, included in cash and cash equivalents | $ 7,534 | $ 6,075 |
Fixed income mutual fund, included in short-term investments | 55,716 | 70,804 |
Total | 63,250 | 76,879 |
(Level 1) | ||
Assets: | ||
Money market funds, included in cash and cash equivalents | 7,534 | 6,075 |
Fixed income mutual fund, included in short-term investments | 55,716 | 70,804 |
Total | 63,250 | 76,879 |
(Level 2) | ||
Assets: | ||
Money market funds, included in cash and cash equivalents | 0 | 0 |
Fixed income mutual fund, included in short-term investments | 0 | 0 |
Total | 0 | 0 |
(Level 3) | ||
Assets: | ||
Money market funds, included in cash and cash equivalents | 0 | 0 |
Fixed income mutual fund, included in short-term investments | 0 | 0 |
Total | $ 0 | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2023 | Dec. 31, 2022 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value disclosure | $ 0 | $ 0 | $ 0 |
Cost basis | 71,900,000 | ||
Cumulative unrealized loss | 500,000 | 500,000 | |
Short-Term Investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value | 70,800,000 | ||
Unrealized gain | 100,000 | 600,000 | |
Cumulative unrealized loss | $ 1,100,000 | $ 1,100,000 | $ 1,100,000 |
Balance Sheet Components - Sche
Balance Sheet Components - Schedule of Inventory (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials | $ 3,600 | $ 2,818 |
Work-in-process | 789 | 1,523 |
Finished goods | 5,625 | 5,371 |
Total | $ 10,014 | $ 9,712 |
Balance Sheet Components -Sched
Balance Sheet Components -Schedule of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | $ 9,797 | $ 9,797 | $ 9,788 | ||
Less: Accumulated depreciation | (8,821) | (8,821) | (8,724) | ||
Property and equipment, net | 976 | 976 | 1,064 | ||
Depreciation (less than $0.1 million for both periods) | 100 | $ 100 | 96 | $ 153 | |
Machinery, equipment, furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 4,443 | 4,443 | 4,434 | ||
Computer equipment and software | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 2,952 | 2,952 | 2,952 | ||
Leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | $ 2,402 | $ 2,402 | $ 2,402 |
Balance Sheet Components - Sc_2
Balance Sheet Components - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Payroll and related expenses | $ 6,637 | $ 5,748 |
Inventory-raw materials | 550 | 764 |
Professional fees | 366 | 227 |
Other | 629 | 675 |
Total accrued liabilities | $ 8,182 | $ 7,414 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
Aug. 31, 2022 | May 31, 2018 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Jun. 30, 2021 | May 31, 2019 | Aug. 31, 2011 | |
Loss Contingencies [Line Items] | ||||||||||
Renewal term | 5 years | |||||||||
Operating lease cost | $ 700,000 | $ 700,000 | $ 1,400,000 | $ 1,300,000 | ||||||
Operating lease term | 7 years | 7 years | ||||||||
Operating lease percent | 8.50% | 8.50% | ||||||||
Operating lease, payments | $ 1,400,000 | $ 1,600,000 | ||||||||
Purchase obligation, to be paid in the next twelve months | $ 2,400,000 | |||||||||
Percentage increase in purchase commitment | 10% | |||||||||
Indemnification liability accrued for officers and directors | $ 0 | 0 | $ 0 | |||||||
Accrual for contingent liabilities | 0 | 0 | 0 | |||||||
Pending Litigation | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Accrual for contingent liabilities | $ 0 | $ 0 | $ 0 | |||||||
Lease Facility | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Face amount | $ 200,000 | $ 700,000 | $ 900,000 | |||||||
Minimum | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Annual rental payments | $ 2,800,000 | |||||||||
Maximum | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Annual rental payments | $ 3,300,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
2023 (remaining six months) | $ 1,387 | |
2024 | 2,857 | |
2025 | 2,942 | |
2026 | 3,031 | |
2027 | 3,122 | |
Thereafter | 8,232 | |
Total undiscounted lease payments | 21,571 | |
Less: imputed interest | 5,408 | |
Total operating lease liability | 16,163 | |
Less: current portion | 1,519 | $ 1,415 |
Operating lease liability, net of current portion | $ 14,644 | $ 15,440 |
Debt - Narrative (Details)
Debt - Narrative (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||
Feb. 28, 2023 USD ($) installment | Sep. 30, 2020 USD ($) shares | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Mar. 01, 2023 | Jan. 31, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | |||||||||
Principal payment number of installment | installment | 1 | ||||||||
Minimum annual net revenue | $ 45,000,000 | ||||||||
Amortization of debt discount and issuance costs | $ 133,000 | $ 128,000 | |||||||
Term Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Face amount | $ 60,000,000 | ||||||||
Proceeds from long term debt | 50,000,000 | ||||||||
Unused borrowing capacity | $ 10,000,000 | ||||||||
Interest rate | 12.50% | ||||||||
Effective percentage | 12.50% | 16.80% | 16.80% | 13.50% | |||||
Redemption fee, percent | 10% | ||||||||
Minimum annual net revenue | $ 45,000,000 | ||||||||
Backend fee | $ 2,948,000 | $ 2,948,000 | |||||||
Amortization of debt discount and issuance costs | 100,000 | $ 100,000 | 100,000 | 100,000 | |||||
Interest expense | 2,100,000 | $ 1,900,000 | 4,100,000 | $ 3,700,000 | |||||
Term Loan | Series B Redeemable Convertible Preferred Stock | |||||||||
Debt Instrument [Line Items] | |||||||||
Backend fee | $ 1,000,000 | ||||||||
Warrants outstanding (in shares) | shares | 346,823 | ||||||||
Warrant liability, noncurrent | $ 600,000 | ||||||||
Term Loan | Payment In Cash | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate | 8.50% | 7.50% | |||||||
Term Loan | Payment in Kind (PIK) Note | |||||||||
Debt Instrument [Line Items] | |||||||||
Face amount | $ 3,200,000 | $ 3,200,000 | |||||||
Interest rate | 5% | 5% | |||||||
Term Loan | Minimum | |||||||||
Debt Instrument [Line Items] | |||||||||
Effective percentage | 15.70% | ||||||||
Term Loan | Maximum | |||||||||
Debt Instrument [Line Items] | |||||||||
Effective percentage | 16.80% |
Debt - Schedule of Maturities o
Debt - Schedule of Maturities of Long-term Debt (Details) - Term Loan $ in Thousands | Jun. 30, 2023 USD ($) |
Debt Instrument [Line Items] | |
2023 (remaining six months) | $ 3,674 |
2024 | 7,308 |
2025 | 64,024 |
Total | 75,006 |
Less: Unamortized debt discount and issuance cost | (770) |
Less: Unaccreted backend fee | (2,948) |
Less: Interest | (16,434) |
Term Loan | $ 54,854 |
Common Stock (Details)
Common Stock (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Class of Stock [Line Items] | ||
Common stock authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock par value (in dollars per share) | $ 0.001 | $ 0.001 |
Dividends declared cash | $ 0 | $ 0 |
Common stock reserved for future issuance (in shares) | 7,806,904 | 7,076,678 |
Shares available for future grant under the 2021 Plan | ||
Class of Stock [Line Items] | ||
Common stock reserved for future issuance (in shares) | 841,592 | 1,443,946 |
Outstanding options under the 2021 Plan | ||
Class of Stock [Line Items] | ||
Common stock reserved for future issuance (in shares) | 3,457,501 | 3,446,583 |
Outstanding restricted stock units under the 2021 Plan | ||
Class of Stock [Line Items] | ||
Common stock reserved for future issuance (in shares) | 2,992,124 | 1,756,209 |
Common stock available for ESPP | ||
Class of Stock [Line Items] | ||
Common stock reserved for future issuance (in shares) | 515,687 | 429,940 |
Stock-Based Incentive Compens_3
Stock-Based Incentive Compensation Plans - Schedule of Available for Grant (Details) - 2021 Equity Incentive Plan | 6 Months Ended |
Jun. 30, 2023 shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Available for Grant [Roll Forward] | |
Shares available for grant, beginning balance (in shares) | 1,443,946 |
Shares authorized (in shares) | 1,252,287 |
Granted/Awarded (in shares) | (2,238,980) |
Cancelled (in shares) | 338,871 |
Withheld for taxes (in shares) | 45,468 |
Shares available for grant, ending balance (in shares) | 841,592 |
Stock-Based Incentive Compens_4
Stock-Based Incentive Compensation Plans - Schedule of Stock Option Activity (Details) - $ / shares | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Number of Shares | ||
Number of shares, beginning balance (in shares) | 3,446,583 | |
Options granted (in shares) | 314,801 | |
Options exercised (in shares) | (181,742) | |
Options cancelled (in shares) | (122,141) | |
Number of shares, ending balance (in shares) | 3,457,501 | 3,446,583 |
Vested and exercisable (in shares) | 2,057,141 | |
Vested and expected to vest (in shares) | 3,457,501 | |
Weighted-Average Exercise Price | ||
Beginning balance (in dollars per share) | $ 3.61 | |
Options granted (in dollar per share) | 3.21 | |
Options exercised (in dollar per share) | 0.03 | |
Options cancelled (in dollar per share) | 4.07 | |
Ending balance (in dollars per share) | 3.75 | $ 3.61 |
Vested and exercisable (in dollars per share) | 3.03 | |
Vested and expected to vest (in dollars per share) | $ 3.75 | |
Weighted Average Remaining Contractual Term (in Years) | ||
Balance | 5 years 2 months 15 days | 8 years 21 days |
Vested and exercisable | 4 years 9 months 21 days | |
Vested and expected to vest | 5 years 2 months 15 days |
Stock-Based Incentive Compens_5
Stock-Based Incentive Compensation Plans - Narrative (Details) - USD ($) $ in Millions | 1 Months Ended | 6 Months Ended | |||
Jun. 07, 2023 | Apr. 30, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options, subject to repurchase (in shares) | 53,599 | 78,389 | |||
ESPP discount percent | 85% | ||||
ESPP, length of offering period | 6 months | ||||
Common stock reserved for future issuance (in shares) | 7,806,904 | 7,076,678 | |||
Unrecognized stock-based compensation expense | $ 19 | ||||
Period for recognition | 2 years 6 months | ||||
2021 Employee Stock Purchase Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock reserved for future issuance (in shares) | 580,000 | ||||
Shares authorized (in shares) | 250,457 | ||||
Number of shares available for grant (in shares) | 515,687 | ||||
Issuance of shares pursuant to employee stock purchase plan (in shares) | 164,710 | 147,217 | |||
Offering period | 6 months | ||||
Period for recognition | 4 months 24 days | ||||
Cost not yet recognized, amount | $ 0.1 |
Stock-Based Incentive Compens_6
Stock-Based Incentive Compensation Plans - Schedule of Restricted Stock Units (Details) - Unvested restricted stock units | 6 Months Ended |
Jun. 30, 2023 $ / shares shares | |
Number of Shares Underlying Outstanding Restricted Stock Units | |
Unvested, beginning balance (in shares) | shares | 1,756,209 |
Granted (in shares) | shares | 1,924,179 |
Vested (in shares) | shares | (471,534) |
Cancelled (in shares) | shares | (216,730) |
Unvested, ending balance (in shares) | shares | 2,992,124 |
Weighted Average Grant Date Fair Value | |
Unvested, beginning balance (in dollars per share) | $ / shares | $ 10.15 |
Granted (in dollars per share) | $ / shares | 4.60 |
Vested (in dollars per share) | $ / shares | 9.70 |
Cancelled (in dollars per share) | $ / shares | 8.72 |
Unvested, ending balance (in dollars per share) | $ / shares | $ 6.76 |
Stock-Based Incentive Compens_7
Stock-Based Incentive Compensation Plans - Schedule of Recognized Stock-based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 2,655 | $ 2,603 | $ 4,780 | $ 4,091 |
Stock options and restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | 2,606 | 2,491 | 4,677 | 3,843 |
ESPP | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | 49 | 112 | 103 | 248 |
Cost of goods sold | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | 148 | 163 | 294 | 273 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | 733 | 748 | 1,233 | 1,188 |
Selling, general and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 1,774 | $ 1,692 | $ 3,253 | $ 2,630 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense (benefit) | $ 0 | $ 0 | $ 0 | $ 0 |
Net Loss per Share Attributab_3
Net Loss per Share Attributable to Common Stockholders - Schedule of Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Numerator: | ||||
Net loss attributable to common stockholders | $ (9,124) | $ (12,690) | $ (19,499) | $ (24,151) |
Denominator: | ||||
Weighted-average common stock outstanding used to compute basic net loss per share (in shares) | 25,472,526 | 24,503,552 | 25,285,933 | 24,406,100 |
Weighted-average common stock outstanding used to compute diluted net loss per share (in shares) | 25,472,526 | 24,503,552 | 25,285,933 | 24,406,100 |
Net loss per share attributable to common stockholders, basic (in dollars per share) | $ (0.36) | $ (0.52) | $ (0.77) | $ (0.99) |
Net loss per share attributable to common stockholders, diluted (in dollars per share) | $ (0.36) | $ (0.52) | $ (0.77) | $ (0.99) |
Net Loss per Share Attributab_4
Net Loss per Share Attributable to Common Stockholders - Schedule of Potentially Dilutive Securities Outstanding (Details) - shares | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total shares (in shares) | 6,614,192 | 5,678,206 |
Options to purchase common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total shares (in shares) | 3,457,501 | 3,547,590 |
Unvested early exercised common stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total shares (in shares) | 53,599 | 125,726 |
Shares committed under ESPP | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total shares (in shares) | 110,968 | 141,864 |
Unvested restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total shares (in shares) | 2,992,124 | 1,863,026 |