Aclaris Therapeutics (ACRS) 10-Q 6 Nov 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Nov. 05, 2018
Document and Entity Information
Entity Registrant Name	Aclaris Therapeutics, Inc.
Entity Central Index Key	1,557,746
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Common Stock, Shares Outstanding		40,936,191
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q3

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEET - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 26,590	$ 20,202
Marketable securities	107,681	173,655
Accounts receivable, net	1,033	481
Inventory	1,044
Prepaid expenses and other current assets	9,171	5,883
Total current assets	145,519	200,221
Marketable securities		14,997
Property and equipment, net	4,409	2,159
Intangible assets	7,292	7,349
Goodwill	18,504	18,504
Other assets	452	279
Total assets	176,176	243,509
Current liabilities:
Accounts payable	13,735	7,822
Accrued expenses	8,545	4,940
Total current liabilities	22,280	12,762
Contingent consideration	5,244	4,378
Other liabilities	1,775	558
Deferred tax liability	549	549
Total liabilities	29,848	18,247
Stockholders' Equity:
Preferred stock, $0.0001 par value; 10,000,000 shares authorized and no shares issued or outstanding at September 30, 2018 and December 31, 2017
Common stock, $0.00001 par value; 100,000,000 shares authorized at September 30, 2018 and December 31, 2017; 30,991,060 and 30,856,505 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively
Additional paid-in capital	400,066	384,943
Accumulated other comprehensive loss	(116)	(246)
Accumulated deficit	(253,622)	(159,435)
Total stockholders’ equity	146,328	225,262
Total liabilities and stockholders’ equity	$ 176,176	$ 243,509

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEET (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
Condensed Consolidated Balance Sheets
Preferred stock, par value (in dollars per share)	$ 0.00001	$ 0.00001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.00001	$ 0.00001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	30,991,060	30,856,505
Common stock, shares outstanding	30,991,060	30,856,505

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Revenue, net	$ 1,628	$ 684	$ 6,422	$ 684
Cost of revenue	1,193	453	3,341	453
Gross profit	435	231	3,081	231
Operating expenses:
Research and development	15,931	10,864	43,472	26,601
Sales and marketing	11,380	3,557	35,030	7,183
General and administrative	6,574	4,566	20,955	13,428
Total operating expenses	33,885	18,987	99,457	47,212
Loss from operations	(33,450)	(18,756)	(96,376)	(46,981)
Other income, net	710	564	2,189	1,392
Net loss	$ (32,740)	$ (18,192)	$ (94,187)	$ (45,589)
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ (1.06)	$ (0.63)	$ (3.04)	$ (1.68)
Weighted average common shares outstanding, basic and diluted (in shares)	30,982,192	28,834,808	30,938,026	27,180,244
Other comprehensive income:
Unrealized gain on marketable securities, net of tax of $0	$ 65	$ 63	$ 111	$ 7
Foreign currency translation adjustments	7	(10)	19	149
Total other comprehensive income	72	53	130	156
Comprehensive loss	(32,668)	(18,139)	(94,057)	(45,433)
ESKATA product sales
Revenue, net	510		2,043
Contract research
Revenue, net	$ 1,118	$ 684	3,379	$ 684
Other revenue
Revenue, net			$ 1,000

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS (Parenthetical) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Condensed Consolidated Statements Of Operations And Comprehensive Loss
Unrealized gain on marketable securities, tax	$ 0	$ 0

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - 9 months ended Sep. 30, 2018 - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Total
Balance at beginning of period at Dec. 31, 2017		$ 384,943	$ (246)	$ (159,435)	$ 225,262
Balance at beginning of period (in shares) at Dec. 31, 2017	30,856,505				30,856,505
Increase (Decrease) in Stockholders' Equity
Exercise of stock options and vesting of RSUs		24			$ 24
Exercise of stock options and vesting of RSUs, shares	134,555
Unrealized gain on marketable securities			111		111
Foreign currency translation adjustment			19		19
Stock-based compensation expense		15,099			15,099
Net loss				(94,187)	(94,187)
Balance at end of period at Sep. 30, 2018		$ 400,066	$ (116)	$ (253,622)	$ 146,328
Balance at end of period (in shares) at Sep. 30, 2018	30,991,060				30,991,060

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash flows from operating activities:
Net loss	$ (94,187)	$ (45,589)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	921	221
Stock-based compensation expense	15,099	10,130
Change in fair value of contingent consideration	866
Changes in operating assets and liabilities:
Accounts receivable	(552)
Inventory	(1,044)
Prepaid expenses and other assets	(3,461)	(4,331)
Accounts payable	5,932	3,130
Accrued expenses	2,863	(14)
Net cash used in operating activities	(73,563)	(36,453)
Cash flows from investing activities:
Purchases of property and equipment	(1,210)	(658)
Acquisition of Confluence, net of cash acquired		(9,647)
Purchases of marketable securities	(112,344)	(120,496)
Proceeds from sales and maturities of marketable securities	193,427	96,674
Net cash provided by (used in) investing activities	79,873	(34,127)
Cash flows from financing activities:
Capital lease payments	(499)
Proceeds from the exercise of employee stock options	577	235
Net cash provided by financing activities	78	100,464
Net increase in cash and cash equivalents	6,388	29,884
Cash and cash equivalents at beginning of period	20,202	30,171
Cash and cash equivalents at end of period	26,590	60,055
Supplemental disclosures of non-cash investing and financing activities:
Additions to property and equipment included in accounts payable	102	20
Fair value of stock issued in connection with Confluence acquisition		9,675
Property and equipment obtained pursuant to capital lease financing arrangements	2,076
Offering costs included in accounts payable	$ 20	107
At The Market Offering
Cash flows from financing activities:
Proceeds from issuance of common stock, net of issuance costs		19,311
Public Offering August 2017
Cash flows from financing activities:
Proceeds from issuance of common stock, net of issuance costs		$ 80,918

Organization and Nature of Busi

Organization and Nature of Business	9 Months Ended
	Sep. 30, 2018
Organization and Nature of Business
Organization and Nature of Business	1. Organization and Nature of Business Aclaris Therapeutics, Inc. was incorporated under the laws of the State of Delaware in 2012. In July 2015, Aclaris Therapeutics International Limited (“ATIL”) was established under the laws of the United Kingdom as a wholly-owned subsidiary of Aclaris Therapeutics, Inc. In March 2016, Vixen Pharmaceuticals, Inc. (“Vixen”) became a wholly-owned subsidiary of Aclaris Therapeutics, Inc., and in September 2018, Vixen was dissolved. In August 2017, Aclaris Life Sciences, Inc. (formerly known as Confluence Life Sciences, Inc.) (“Confluence”) was acquired by Aclaris Therapeutics, Inc. and became a wholly-owned subsidiary thereof (see Note 3). Aclaris Therapeutics, Inc., ATIL, Vixen and Confluence are referred to collectively as the “Company.” The Company is a dermatologist-led biopharmaceutical company focused on identifying, developing and commercializing innovative therapies to address significant unmet needs in medical and aesthetic dermatology and immunology. The Company’s lead drug, ESKATA (hydrogen peroxide) Topical Solution, 40% (w/w) (“ESKATA”), is a proprietary high‑concentration formulation of hydrogen peroxide that the Company is commercializing as an office-based prescription treatment for raised seborrheic keratosis (“SK”), a common non‑malignant skin tumor. The Company submitted a New Drug Application (“NDA”) for ESKATA to the U.S. Food and Drug Administration (“FDA”) in February 2017, and it was approved in December 2017. The Company launched ESKATA in May 2018. In October 2018, the Company entered into a definitive agreement to acquire the worldwide rights to a second commercial product, RHOFADE (see Note 15). Liquidity The Company’s condensed consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities in the ordinary course of business. At September 30, 2018, the Company had cash, cash equivalents and marketable securities of $134,271 and an accumulated deficit of $253,622. Since inception, the Company has incurred net losses and negative cash flows from its operations. Prior to the acquisition of Confluence in August 2017, the Company had never generated any revenue. There can be no assurance that profitable operations will ever be achieved, and, if achieved, will be sustained on a continuing basis. In addition, development activities, clinical and preclinical testing of the Company’s drug candidates, and commercialization of the Company’s products will require significant additional financing. The future viability of the Company is dependent on its ability to generate cash from operating activities or to raise additional capital to finance its operations. The Company’s failure to raise capital as and when needed could have a negative impact on its financial condition and ability to pursue its business strategies.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2018
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The condensed consolidated financial statements of the Company include the accounts of the operating parent company, Aclaris Therapeutics, Inc., and its wholly-owned subsidiaries, ATIL, Confluence and Vixen. All significant intercompany transactions have been eliminated. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting periods. Significant estimates and assumptions reflected in these financial statements include, but are not limited to, research and development expenses, contingent consideration and the valuation of stock-based awards. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Actual results could differ from the Company’s estimates. Unaudited Interim Financial Information The accompanying condensed consolidated balance sheet as of September 30, 2018, the condensed consolidated statement of operations and comprehensive loss for the three and nine months ended September 30, 2018 and 2017, the condensed consolidated statement of stockholders’ equity for the nine months ended September 30, 2018, and the condensed consolidated statement of cash flows for the nine months ended September 30, 2018 and 2017 are unaudited. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited annual financial statements contained in the Company’s annual report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 12, 2018 and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the Company’s financial position as of September 30, 2018, the results of its operations and comprehensive loss for the three and nine months ended September 30, 2018 and 2017 and its cash flows for the nine months ended September 30, 2018 and 2017. The condensed consolidated balance sheet data as of December 31, 2017 was derived from audited financial statements but does not include all disclosures required by GAAP. The financial data and other information disclosed in these notes related to the three and nine months ended September 30, 2018 and 2017 are unaudited. The results for the three and nine months ended September 30, 2018 are not necessarily indicative of results to be expected for the year ending December 31, 2018, any other interim periods, or any future year or period. The unaudited interim financial statements of the Company included herein have been prepared, pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto for the year ended December 31, 2017 included in the Company’s annual report on Form 10-K filed with the SEC on March 12, 2018. Significant Accounting Policies The Company’s significant accounting policies are disclosed in the audited consolidated financial statements for the year ended December 31, 2017 included in the Company’s annual report on Form 10-K filed with the SEC on March 12, 2018. Since the date of such financial statements, there have been no changes to the Company’s significant accounting policies other than those noted below. In February 2017, the Company paid a $2,000 Prescription Drug User Fee Act (“PDUFA”) fee to the FDA in conjunction with the filing of its NDA for ESKATA. The Company requested a waiver and refund of this PDUFA fee, which was approved by the FDA in December 2017, and was received by the Company in January 2018. Revenue Recognition The Company accounts for revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. Under ASC Topic 606, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. To determine revenue recognition in accordance with ASC Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) performance obligations are satisfied. At contract inception, the Company assesses the goods or services promised within a contract with a customer to identify the performance obligations, and to determine if they are distinct. The Company recognizes the revenue that is allocated to each distinct performance obligation when (or as) that performance obligation is satisfied. The Company only recognizes revenue when collection of the consideration it is entitled to under a contract with a customer is probable. ESKATA Product Sales The Company sells ESKATA to McKesson Specialty Care Distribution (“McKesson”) which resells ESKATA to healthcare providers, group purchasing organizations (“GPOs”) and hospitals. The Company has entered into an agreement directly with one GPO, and may enter into additional agreements directly with other GPOs and corporate accounts, that provide for discounted pricing in the form of volume-based rebates and chargebacks, and administrative fees. The Company does not accept product returns. The Company recognizes revenue from sales of ESKATA at the point when control has transferred to the customer, which generally occurs when McKesson takes delivery of the product. The Company includes estimates for variable consideration, including rebates, chargebacks and administrative fees, as a reduction of revenue when it is recognized. Estimates of variable consideration include reserves for rebates, chargebacks and administrative fees related to units remaining in the distribution channel at McKesson. The Company considers all relevant factors when estimating variable consideration including the terms of current contracts, market trends, industry data and forecasted buying patterns as available and appropriate. The Company has determined that its arrangement with McKesson, its only direct customer, does not include a financing component since payment terms under the agreement do not exceed one year. The Company expenses incremental costs of contracts with direct and indirect customers, which generally include sales commissions, in the period they are incurred. Contract Research The Company earns revenue from the provision of laboratory services to clients through Confluence, its wholly-owned subsidiary. Laboratory service revenue is generally evidenced by contracts with clients which are on an agreed upon fixed-price, fee-for-service basis and are generally billed on a monthly basis in arrears for services rendered. Revenue related to these contracts is generally recognized as the laboratory services are performed, based upon the rates specified in the contracts. Under ASC Topic 606, the Company elected to apply the “right to invoice” practical expedient when recognizing laboratory service revenue. The Company recognizes laboratory service revenue in the amount to which it has the right to invoice. The Company has also received revenue from grants under the Small Business Innovation Research program of the National Institutes of Health (“NIH”). During the nine months ended September 30, 2018, the Company, through Confluence, its wholly-owned subsidiary, had two active grants from NIH which were related to early-stage research. As of September 30, 2018, there are no remaining funds available to the Company under the grants. The Company recognizes revenue related to grants as amounts become reimbursable under each grant, which is generally when research is performed, and the related costs are incurred. Inventory Inventory includes the third-party cost of manufacturing and assembly of the finished product form of ESKATA, quality control and other overhead costs. Inventory is stated at the lower of cost or net realizable value. Inventory is adjusted for short-dated, unmarketable inventory equal to the difference between the cost of inventory and the estimated value based upon assumptions about future demand and market conditions. The Company had $1,044 and $0 of inventory as of September 30, 2018 and December 31, 2017, respectively, which was comprised solely of finished goods. Contingent Consideration The Company initially recorded the contingent consideration related to future potential payments based upon the achievement of certain development, regulatory and commercial milestones, resulting from the acquisition of Confluence, at its estimated fair value on the date of acquisition. Changes in fair value reflect new information about the likelihood of the payment of the contingent consideration and the passage of time. For example, if the timing of the development of an acquired drug candidate, or the size of potential commercial opportunities related to an acquired drug, differ from the Company’s assumptions, then the fair value of contingent consideration would be adjusted accordingly. Future changes in the fair value of the contingent consideration, if any, will be recorded as income or expense in the Company’s condensed consolidated statement of operations. Recently Issued Accounting Pronouncements In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40). ASU 2018-15 requires a customer in a cloud computing arrangement that is a service contract to follow the internal-use software guidance in ASC 350-40 to determine which implementation costs to capitalize as assets or expense as incurred. The standard will be effective for fiscal years beginning after December 15, 2019, including interim periods within such fiscal years, with early adoption permitted. The Company is evaluating the impact of ASU 2018-15 on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820). The FASB developed the amendments to ASC 820 as part of its broader disclosure framework project, which aims to improve the effectiveness of disclosures in the notes to financial statements by focusing on requirements that clearly communicate the most important information to users of the financial statements. This update eliminates certain disclosure requirements for fair value measurements for all entities, requires public entities to disclose certain new information and modifies some of the existing disclosure requirements. The standard will be effective for fiscal years beginning after December 15, 2019, including interim periods within such fiscal years, with early adoption permitted. The Company is evaluating the impact of ASU 2018-13 on its consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718). The amendments in this ASU expand the scope of Topic 718 to include stock-based compensation arrangements with nonemployees except for specific guidance on option pricing model inputs and cost attribution. ASU 2018-07 is effective for annual reporting periods beginning after December 31, 2018, including interim periods within that year, and early adoption is permitted. The Company is evaluating the impact of ASU 2018-07 on its consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Business Combinations-Clarifying the Definition of a Business (Topic 805). The amendments in this ASU provide a screen to determine when a set of acquired assets and/or activities is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired, or disposed of, is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. The amendments in this ASU will reduce the number of transactions that meet the definition of a business. ASU 2017-01 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those years, and early adoption will be permitted. The Company adopted the provisions of this standard on January 1, 2018, the impact of which on its consolidated financial statements was not significant. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). Under this ASU, entities should recognize revenue in an amount that reflects the consideration to which they expect to be entitled to in exchange for goods and services provided. ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2017. The Company adopted the provisions of this standard on January 1, 2018, using the modified retrospective transition method. The Company did not recognize any transition adjustments as a result of adopting ASU 2014-09 and, accordingly, comparative information has not been restated for the periods reported.

Acquisition of Confluence

Acquisition of Confluence	9 Months Ended
	Sep. 30, 2018
Acquisition of Confluence
Acquisition of Confluence	3. Acquisition of Confluence In August 2017, the Company acquired Confluence, at which time, Confluence became a wholly-owned subsidiary of the Company. The Company gave aggregate consideration with a fair value of $24,322 to the equity holders of Confluence. The Company also agreed to pay the Confluence equity holders contingent consideration of up to $80,000, based upon the achievement of certain development, regulatory and commercial milestones, including $2,500 of which may be paid in shares of the Company’s common stock upon the achievement of a specified development milestone. In addition, the Company has agreed to pay the Confluence equity holders specified future royalty payments calculated as a low single-digit percentage of annual net sales, subject to specified reductions, limitations and other adjustments, until the date that all of the patent rights for that product have expired, as determined on a country-by-country and product-by-product basis or, in specified circumstances, ten years from the first commercial sale of such product. The following table summarizes the fair value of total consideration given to the Confluence equity holders in connection with the acquisition: Cash consideration paid $ 10,269 Aclaris common stock issued 9,675 Contingent consideration 4,378 Total fair value of consideration to Confluence equity holders $ 24,322 The Company accounted for the acquisition of Confluence as a business combination using the acquisition method of accounting. Under the acquisition method of accounting, the assets acquired and liabilities assumed in this transaction were recorded at their respective fair values on the date of acquisition using assumptions that are subject to change. The Company finalized the purchase price allocation for the acquisition of Confluence in the second quarter of 2018. The following supplemental unaudited pro forma information presents the Company’s financial results, for the periods presented, as if the acquisition of Confluence had occurred on January 1, 2017. This supplemental unaudited pro forma financial information has been prepared for comparative purposes only, and is not necessarily indicative of what actual results would have been had the acquisition of Confluence occurred on January 1, 2017, nor is this information indicative of future results. Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Revenue $ 1,628 $ 1,063 $ 6,422 $ 3,366 Gross profit 435 298 3,081 1,102 Total operating expenses 33,885 18,736 99,457 48,122 Net loss (32,740) (17,875) (94,187) (45,627) The supplemental unaudited pro forma financial results for the three and nine months ended September 30, 2017 include adjustments to exclude $997 and $1,351, respectively, of acquisition-related expenses, as well as $217 and $888, respectively, to exclude revenue billed to the Company by Confluence. The supplemental unaudited pro forma financial results for the three and nine months ended September 30, 2017 also include an adjustment for amortization expense related to the other intangible asset acquired.

Fair Value of Financial Assets

Fair Value of Financial Assets and Liabilities	9 Months Ended
	Sep. 30, 2018
Fair Value of Financial Assets and Liabilities
Fair Value of Financial Assets and Liabilities	4. Fair Value of Financial Assets and Liabilities The following tables present information about the Company’s assets and liabilities, which are measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values: September 30, 2018 Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 24,583 $ — $ — $ 24,583 Marketable securities — 107,681 — 107,681 Total Assets $ 24,583 $ 107,681 $ — $ 132,264 Liabilities: Acquisition-related contingent consideration $ — $ — $ 5,244 $ 5,244 Total liabilities $ — $ — $ 5,244 $ 5,244 December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 19,339 $ — $ — $ 19,339 Marketable securities — 188,652 — 188,652 Total Assets $ 19,339 $ 188,652 $ — $ 207,991 Liabilities: Acquisition-related contingent consideration $ — $ — $ 4,378 $ 4,378 Total liabilities $ — $ — $ 4,378 $ 4,378 As of September 30, 2018 and December 31, 2017, the Company’s cash equivalents consisted of investments with maturities of less than three months and included a money market fund, which was valued based upon Level 1 inputs, and commercial paper which was valued based upon Level 2 inputs. In determining the fair value of its Level 2 investments the Company relied on quoted prices for identical securities in markets that are not active. These quoted prices were obtained by the Company with the assistance of a third-party pricing service based on available trade, bid and other observable market data for identical securities. On a quarterly basis, the Company compares the quoted prices obtained from the third-party pricing service to other available independent pricing information to validate the reasonableness of those quoted prices. The Company evaluates whether adjustments to third-party pricing is necessary and, historically, the Company has not made adjustments to the quoted prices obtained from the third-party pricing service. During the three and nine months ended September 30, 2018 and the year ended December 31, 2017, there were no transfers between Level 1, Level 2 and Level 3. The change in contingent consideration related to acquisition of Confluence of $866 during the nine months ended September 30, 2018 was the result of updates to the Company’s assumptions related to drug discovery research on the soft-JAK inhibitors acquired as part of the acquisition, which progressed more quickly than originally planned. The following tables present the fair value of the Company’s available for sale marketable securities by type of security: September 30, 2018 Gross Gross Amortized Unrealized Unrealized Fair Cost Gain Loss Value Marketable securities: Corporate debt securities $ 16,088 $ — $ (23) $ 16,065 Commercial paper 51,691 — — 51,691 Asset-backed securities 16,009 — (8) 16,001 U.S. government agency debt securities 23,952 — (28) 23,924 Total marketable securities $ 107,740 $ — $ (59) $ 107,681 December 31, 2017 Gross Gross Amortized Unrealized Unrealized Fair Cost Gain Loss Value Marketable securities: Corporate debt securities $ 37,401 $ — $ (68) $ 37,333 Commercial paper 85,202 — — 85,202 Asset-backed securities 16,708 — (13) 16,695 U.S. government agency debt securities 49,511 — (89) 49,422 Total marketable securities $ 188,822 $ — $ (170) $ 188,652

Property and Equipment, Net

Property and Equipment, Net	9 Months Ended
	Sep. 30, 2018
Property and Equipment, Net
Property and Equipment, Net	5. Property and Equipment, Net Property and equipment, net consisted of the following: September 30, December 31, 2018 2017 Computer equipment $ 1,338 $ 650 Fleet vehicles 2,076 — Manufacturing equipment 562 511 Lab equipment 928 721 Furniture and fixtures 524 327 Leasehold improvements 326 430 Property and equipment, gross 5,754 2,639 Accumulated depreciation (1,345) (480) Property and equipment, net $ 4,409 $ 2,159 Depreciation expense was $366 and $103 for the three months ended September 30, 2018 and 2017, respectively, and $865 and $208 for the nine months ended September 30, 2018 and 2017, respectively.

Accrued Expenses

Accrued Expenses	9 Months Ended
	Sep. 30, 2018
Accrued Expenses
Accrued Expenses	6. Accrued Expenses Accrued expenses consisted of the following: September 30, December 31, 2018 2017 Employee compensation expenses $ 4,219 $ 3,010 Sales and marketing expenses 833 39 Research and development expenses 1,900 627 Capital leases, current portion 591 142 Professional fees 336 108 Payable to NST — 590 Other 666 424 Total accrued expenses $ 8,545 $ 4,940

Stockholders' Equity

Stockholders' Equity	9 Months Ended
	Sep. 30, 2018
Stockholders' Equity
Stockholders' Equity	7. Stockholders’ Equity Preferred Stock As of September 30, 2018 and December 31, 2017, the Company’s amended and restated certificate of incorporation authorized the Company to issue 10,000,000 shares of undesignated preferred stock. No shares of preferred stock were outstanding as of September 30, 2018 or December 31, 2017. Common Stock As of September 30, 2018 and December 31, 2017, the Company’s amended and restated certificate of incorporation authorized the Company to issue 100,000,000 shares of $0.00001 par value common stock. Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders. Common stockholders are entitled to receive dividends, as may be declared by the board of directors, if any, subject to any preferential dividend rights of any series of preferred stock that may be outstanding. The Company did not declare any dividends through September 30, 2018. At-The-Market Equity Offering In November 2016, the Company entered into an at-the-market sales agreement with Cowen and Company, LLC (“Cowen”) to sell the Company’s securities under a shelf registration statement filed in November 2016. In October 2018, the Company terminated the at-the-market sales agreement with Cowen. During the nine months ended September 30, 2018, the Company did not issue any shares of common stock under the at-the-market sales agreement. As of September 30, 2018, the Company had issued and sold an aggregate of 635,000 shares of common stock under the at-the-market sales agreement at a weighted average price per share of $31.50, for aggregate gross proceeds of $20,003. The Company has incurred expenses of $691 in connection with the shares issued under the at-the-market sales agreement. Public Offerings of Common Stock In August 2017, the Company entered into an underwriting agreement pursuant to which the Company issued and sold 3,747,602 shares of common stock under a registration statement on Form S-3, including the underwriters’ partial exercise of their option to purchase additional shares. The shares of common stock were sold to the public at a price of $23.02 per share, for gross proceeds of $86,270. The Company paid underwriting discounts and commissions of $5,176 to the underwriters and incurred expenses of $176 in connection with this public offering. The net offering proceeds received by the Company, after deducting underwriting discounts and commissions and offering expenses, were $80,918. In October 2018, the Company consummated a second public offering of shares of common stock (see Note 15).

Stock-Based Awards

Stock-Based Awards	9 Months Ended
	Sep. 30, 2018
Stock-Based Awards
Stock-Based Awards	8. Stock‑Based Awards 2017 Inducement Plan In July 2017, the Company’s board of directors adopted the 2017 Inducement Plan (the “2017 Inducement Plan”). The 2017 Inducement Plan is a non-shareholder approved stock plan adopted pursuant to the “inducement exception” provided under Nasdaq listing rules. The only employees eligible to receive grants of awards under the 2017 Inducement Plan are individuals who satisfy the standards for inducement grants under Nasdaq listing rules, generally including individuals who were not previously an employee or director of the Company. Under the terms of the 2017 Inducement Plan upon adoption, the Company may grant up to 1,000,000 shares of common stock pursuant to nonqualified stock options, stock appreciation rights, restricted stock awards, restricted stock unit (“RSU”) awards, and other stock awards. The shares of common stock underlying any awards that expire, or are otherwise terminated, settled in cash or repurchased by the Company under the 2017 Inducement Plan will be added back to the shares of common stock available for issuance under the 2017 Inducement Plan. As of September 30, 2018, 22,471 shares of common stock were available for grant under the 2017 Inducement Plan. 2015 Equity Incentive Plan In September 2015, the Company’s board of directors adopted the 2015 Equity Incentive Plan (the “2015 Plan”), and on September 16, 2015, the Company’s stockholders approved the 2015 Plan. The 2015 Plan became effective in connection with the Company’s initial public offering in October 2015. Beginning at the time the 2015 Plan became effective, no further grants may be made under the Company’s 2012 Equity Compensation Plan, as amended and restated (the “2012 Plan”). The 2015 Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock awards, RSU awards, performance stock awards, cash-based awards and other stock-based awards. The number of shares initially reserved for issuance under the 2015 Plan was 1,643,872 shares of common stock. The number of shares of common stock that may be issued under the 2015 Plan will automatically increase on January 1 of each year, beginning on January 1, 2016 and ending on January 1, 2025, in an amount equal to the lesser of (i) 4.0% of the shares of the Company’s common stock outstanding on December 31 of the preceding calendar year or (ii) an amount determined by the Company’s board of directors. The shares of common stock underlying any awards that expire, are otherwise terminated, settled in cash or repurchased by the Company under the 2015 Plan and the 2012 Plan will be added back to the shares of common stock available for issuance under the 2015 Plan. As of January 1, 2018, the number of shares of common stock that may be issued under the 2015 Plan was automatically increased by 1,234,260 shares. As of September 30, 2018, 1,718,918 shares remained available for grant under the 2015 Plan. 2012 Equity Compensation Plan Upon the 2015 Plan becoming effective, no further grants can be made under the 2012 Plan. The Company granted stock options to purchase a total of 1,140,524 shares under the 2012 Plan, of which 951,905 and 984,720 were outstanding as of September 30, 2018 and December 31, 2017, respectively. Stock options granted under the 2012 Plan vest over four years and expire after ten years. As required, the exercise price for the stock options granted under the 2012 Plan was not less than the fair value of the shares of common stock underlying the awards as determined by the Company as of the date of grant. Stock Option Valuation The weighted average assumptions the Company used to estimate the fair value of stock options granted were as follows: Nine Months Ended September 30, 2018 2017 Risk-free interest rate 2.65 % 1.89 % Expected term (in years) 6.3 6.2 Expected volatility 96.56 % 93.84 % Expected dividend yield 0 % 0 % The Company recognizes compensation expense for awards over their vesting period. Compensation expense for awards includes the impact of forfeitures in the period when they occur. Stock Options The following table summarizes stock option activity from January 1, 2018 through September 30, 2018: Weighted Weighted Average Average Remaining Aggregate Number Exercise Contractual Intrinsic of Shares Price Term Value (in years) Outstanding as of December 31, 2017 3,328,757 $ 20.69 8.28 $ 19,812 Granted 1,397,900 21.25 Exercised (59,450) 9.70 Forfeited and cancelled (343,854) 24.82 Outstanding as of September 30, 2018 4,323,353 $ 20.69 8.10 $ 7,634 Options vested and expected to vest as of September 30, 2018 4,323,353 $ 20.69 8.10 $ 7,634 Options exercisable as of September 30, 2018 1,543,159 (1) $ 15.70 7.00 $ 6,785 (1) All options granted under the 2012 Plan are exercisable immediately, subject to a repurchase right in the Company’s favor that lapses as the option vests. This amount reflects the number of shares under options that were vested, as opposed to exercisable, as of September 30, 2018. The weighted average grant date fair value of stock options granted during the nine months ended September 30, 2018 was $16.75 per share. The intrinsic value of a stock option is calculated as the difference between the exercise price of the stock option and the fair value of the underlying common stock, and cannot be less than zero. Restricted Stock Units The following table summarizes RSU activity from January 1, 2018 through September 30, 2018: Weighted Average Grant Date Number Fair Value of Shares Per Share Outstanding as of December 31, 2017 283,553 $ 27.02 Granted 419,160 21.12 Vested (106,202) 26.89 Forfeited and cancelled (54,883) 23.76 Outstanding as of September 30, 2018 541,628 $ 22.81 Stock‑Based Compensation The following table summarizes stock‑based compensation expense recorded by the Company: Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Cost of revenue $ 194 $ 130 $ 560 $ 130 Research and development 1,433 1,332 4,916 3,853 Sales and marketing 760 480 2,687 1,260 General and administrative 2,320 1,731 6,936 4,887 Total stock-based compensation expense $ 4,707 $ 3,673 $ 15,099 $ 10,130 As of September 30, 2018, the Company had unrecognized stock‑based compensation expense for stock options and RSUs of $40,938 and $10,222, respectively, which is expected to be recognized over weighted average periods of 2.73 years and 3.10 years, respectively.

Net Loss per Share

Net Loss per Share	9 Months Ended
	Sep. 30, 2018
Net Loss per Share
Net Loss per Share	9. Net Loss per Share Basic and diluted net loss per share is summarized in the following table: Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Numerator: Net loss $ (32,740) $ (18,192) $ (94,187) $ (45,589) Denominator: Weighted average shares of common stock outstanding 30,982,192 28,834,808 30,938,026 27,180,244 Net loss per share, basic and diluted $ (1.06) $ (0.63) $ (3.04) $ (1.68) The Company’s potentially dilutive securities, which included stock options and RSUs, have been excluded from the computation of diluted net loss per share since the effect would be to reduce the net loss per share. Therefore, the weighted average number of shares of common stock outstanding used to calculate both basic and diluted net loss per share is the same. The following table presents potential shares of common stock excluded from the calculation of diluted net loss per share for the three and nine months ended September 30, 2018 and 2017. All share amounts presented in the table below represent the total number outstanding as of September 30, 2018 and 2017. September 30, 2018 2017 Options to purchase common stock 4,323,353 3,242,831 Restricted stock unit awards 541,628 294,331 Total potential shares of common stock 4,864,981 3,537,162

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2018
Commitments and Contingencies
Commitments and Contingencies	10. Commitments and Contingencies Agreements for Office Space In November 2017, the Company entered into a sublease agreement with Auxilium Pharmaceuticals, LLC (the “Sublandlord”) pursuant to which it subleases 33,019 square feet of office space for its headquarters in Wayne, Pennsylvania. Subject to the consent of Chesterbrook Partners, LP (“Landlord”) as set forth in the lease by and between them and Sublandlord, the sublease has a term that runs through October 2023. If for any reason the lease between the Landlord and Sublandlord is terminated or expires prior to October 2023, the Company’s sublease will automatically terminate. In November 2016, the Company entered into a lease agreement with a third party for additional office space in Malvern, Pennsylvania with a term ending in November 2019. The Company also occupies office and laboratory space in St. Louis, Missouri under the terms of an agreement which it entered into in January 2018 and which expires in December 2018. Rent expense was $204 and $110 for the three months ended September 30, 2018 and 2017, respectively, and was $682 and $284 for the nine months ended September 30, 2018 and 2017, respectively. The Company recognizes rent expense on a straight-line basis over the term of the lease and has accrued for rent expense incurred but not yet paid. Capital Leases Laboratory Equipment The Company leases laboratory equipment which is used in its laboratory space in St. Louis, Missouri under two capital lease financing arrangements which the Company entered into in August 2017 and October 2017, respectively. The capital leases have terms which end in October 2020 and December 2020, respectively. Fleet Vehicles The Company leases automobiles for its sales force and other field-based employees under the terms of a master lease agreement with a third party. The lease term for each automobile begins on the date the Company takes delivery and continues for a period of four years. The Company has accounted for the automobile leases as capital leases in its condensed consolidated financial statements. As of September 30, 2018, future minimum payments under operating and capital lease agreements were as follows: Year Ending December 31, 2018 $ 312 2019 1,100 2020 1,037 2021 1,054 2022 791 Thereafter 531 Total $ 4,825

Related Party Transactions

Related Party Transactions	9 Months Ended
	Sep. 30, 2018
Related Party Transactions
Related Party Transactions	11. Related Party Transactions In August 2013, the Company entered into a sublease agreement with NeXeption, Inc. ("NeXeption"), which was subsequently assigned to NST Consulting, LLC, a wholly-owned subsidiary of NST, LLC. In November 2017, the Company terminated the sublease with NST Consulting, LLC effective March 31, 2018. The Company paid $590 to NST Consulting, LLC, which amount represented accelerated rent payments. Total net payments made under the sublease during the nine months ended September 30, 2018 and 2017 were $570 and $231, respectively. In February 2014, the Company entered into a services agreement with NST, LLC (the “NST Services Agreement”), pursuant to which NST, LLC provided certain pharmaceutical development, management and other administrative services to the Company. Under the same agreement, the Company also provided services to another company under common control with the Company and NST, LLC and was reimbursed by NST, LLC for those services. In November 2017, the Company terminated the NST Services Agreement effective December 31, 2017. Mr. Stephen Tullman, the chairman of the Company’s board of directors, was an executive officer of NeXeption and is also the manager of NST Consulting, LLC and NST, LLC, and three of the Company’s executive officers are and have been members of entities affiliated with NST, LLC. During the three and nine months ended September 30, 2018 and 2017, amounts included in the condensed consolidated statement of operations and comprehensive loss for the NST Services Agreement are summarized in the following table: Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Services provided by NST Consulting, LLC $ — $ 49 $ — $ 161 Services provided to NST Consulting, LLC — — — (18) General and administrative expense, net $ — $ 49 $ — $ 143 Net payments made to NST Consulting, LLC $ — $ 35 $ — $ 218 The Company had a net amount payable of $0 and $570 to NST Consulting, LLC under the NST Services Agreement as of September 30, 2018 and December 31, 2017, respectively.

Agreements Related to Intellect

Agreements Related to Intellectual Property	9 Months Ended
	Sep. 30, 2018
Agreements Related to Intellectual Property
Agreements Related to Intellectual Property	12. Agreements Related to Intellectual Property License, Development and Commercialization Agreement – Cipher Pharmaceuticals Inc. In April 2018, the Company entered into an exclusive license agreement with Cipher Pharmaceuticals Inc. (“Cipher”) for the rights to obtain regulatory approval of and commercialize A-101 40% Topical Solution in Canada for the treatment of SK. Under the agreement, Cipher is responsible for obtaining marketing approval in Canada for A-101 40% Topical Solution. The Company will supply Cipher with finished product, and, if regulatory approval is obtained, Cipher will be responsible for distribution and commercialization of A-101 40% Topical Solution in Canada. Additionally, Cipher is responsible for all expenses related to regulatory and commercial activities for A-101 40% Topical Solution in Canada. The Company received an up-front payment of $1,000 upon signing of the agreement with Cipher, which is included in other revenue on the Company’s condensed consolidated statement of operations for the nine months ended September 30, 2018. The Company can earn aggregate payments of $1,000 upon the achievement of specified development milestones, and aggregate payments of $1,750 upon the achievement of specified commercial milestones under the terms of the agreement with Cipher. Cipher will also be required to pay the Company a low double-digit percentage royalty on net sales of A-101 40% Topical Solution in Canada. The term of the agreement expires on the later of the expiration of applicable patents in Canada or the 15 th anniversary of the first commercial sale of licensed product in Canada. Assignment Agreement – Estate of Mickey Miller and Finder’s Services Agreement – KPT Consulting, LLC In August 2012, the Company entered into an assignment agreement with the Estate of Mickey Miller (the “Miller Estate”), under which the Company acquired some of the intellectual property rights covering A-101. In connection with obtaining the assignment of the intellectual property from the Miller Estate, the Company also entered into a separate finder’s services agreement with KPT Consulting, LLC. Under the terms of the finder’s services agreement, the Company made a milestone payment of $1,000 upon the achievement of specified regulatory milestones in April 2017 and a milestone payment of $1,500 upon the achievement of specified commercial milestones in May 2018. The payments were recorded as general and administrative expenses in the Company’s condensed consolidated statement of operations. Under the finder’s services agreement, the Company is obligated to make an additional milestone payment of $3,000 upon the achievement of a specified commercial milestone. Under each of the assignment agreement and the finder’s services agreement, the Company is also obligated to pay royalties on sales of A-101 or related products, at low single-digit percentages of net sales, subject to reduction in specified circumstances. During the nine months ended September 30, 2018, the Company incurred an aggregate expense of $82 related to royalty payments under these agreements. Both agreements will terminate upon the expiration of the last pending, viable patent claim of the patents acquired under the assignment agreement, but no sooner than 15 years from the effective date of the agreements.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2018
Income Taxes
Income Taxes	13. Income Taxes The Company did not record a federal or state income tax benefit for losses incurred during the three and nine months ended September 30, 2018 and 2017 due to the Company’s conclusion that a valuation allowance was required for those periods.

Segments

Segments	9 Months Ended
	Sep. 30, 2018
Segments
Segments	14. Segment Information The Company has two reportable segments, dermatology therapeutics and contract research. The dermatology therapeutics segment is focused on identifying, developing and commercializing innovative therapies to address significant unmet needs in medical and aesthetic dermatology and immunology. The Company’s lead drug, ESKATA, is a proprietary formulation of high-concentration hydrogen peroxide topical solution that the Company is commercializing as an office-based prescription treatment for raised SKs, a common non-malignant skin tumor, and which is distributed by a wholesaler. The contract research segment earns revenue from the provision of laboratory services to clients through Confluence, the Company’s wholly-owned subsidiary. Laboratory service revenue is generally evidenced by contracts with clients which are on an agreed upon fixed-price, fee-for-service basis. Corporate and other includes general and administrative expenses as well as eliminations of intercompany transactions. The Company does not report balance sheet information by segment since it is not reviewed by the chief operating decision maker, and all of the Company’s tangible assets are held in the United States. The Company’s results of operations by segment for the three and nine months ended September 30, 2018 and 2017 are summarized in the tables below: Dermatology Contract Corporate Total Three Months Ended September 30, 2018 Therapeutics Research and Other Company Revenue, net $ 510 $ 3,225 $ (2,107) $ 1,628 Cost of revenue 126 2,823 (1,756) 1,193 Research and development 15,931 — — 15,931 Sales and marketing 11,366 14 — 11,380 General and administrative — 566 6,008 6,574 Loss from operations $ (26,913) $ (178) $ (6,359) $ (33,450) Dermatology Contract Corporate Total Three Months Ended September 30, 2017 Therapeutics Research and Other Company Revenue, net $ — $ 1,212 $ (528) $ 684 Cost of revenue — 893 (440) 453 Research and development 10,864 — — 10,864 Sales and marketing 3,555 2 — 3,557 General and administrative 72 196 4,298 4,566 Loss from operations $ (14,491) $ 121 $ (4,386) $ (18,756) Dermatology Contract Corporate Total Nine Months Ended September 30, 2018 Therapeutics Research and Other Company Revenue, net $ 3,043 $ 8,779 $ (5,400) $ 6,422 Cost of revenue 278 7,564 (4,501) 3,341 Research and development 43,472 — — 43,472 Sales and marketing 34,996 34 — 35,030 General and administrative — 1,557 19,398 20,955 Loss from operations $ (75,703) $ (376) $ (20,297) $ (96,376) Dermatology Contract Corporate Total Nine Months Ended September 30, 2017 Therapeutics Research and Other Company Revenue, net $ — $ 1,212 $ (528) $ 684 Cost of revenue — 893 (440) 453 Research and development 26,601 — — 26,601 Sales and marketing 7,181 2 — 7,183 General and administrative 223 195 13,010 13,428 Loss from operations $ (34,005) $ 122 $ (13,098) $ (46,981) Foreign Subsidiary The Company’s wholly-owned subsidiary, ATIL, was formed and operates in the United Kingdom. ATIL is utilized for research and development, regulatory and administrative functions and had $38 and $175 of net assets, composed principally of cash, as of September 30, 2018 and December 31, 2017, respectively. Intersegment Revenue Revenue for the contract research segment includes $2,107 and $528 for services performed on behalf of the dermatology therapeutics segment for the three months ended September 30, 2018 and 2017, respectively, and $5,400 and $528 for services performed on behalf of the dermatology therapeutics segment for the nine months ended September 30, 2018 and 2017, respectively. All intersegment revenue has been eliminated in the Company’s condensed consolidated statement of operations.

Subsequent Events

Subsequent Events	9 Months Ended
	Sep. 30, 2018
Subsequent Events
Subsequent Events	15. Subsequent Events Asset Purchase Agreement – Allergan Sales, LLC On October 15, 2018, the Company entered into an Asset Purchase Agreement (“APA”) with Allergan Sales, LLC (“Allergan”). Pursuant to the APA, the Company has agreed to acquire the worldwide rights to RHOFADE (oxymetazoline hydrochloride) cream, 1%, which includes an exclusive license to certain intellectual property for RHOFADE, as well as additional intellectual property (the “Acquisition”). The Company expects the transaction to close before the end of 2018. Pursuant to the APA, the Company is required to pay Allergan cash consideration of $65,000, including $58,500 to be paid at closing and $6,500 to be placed in escrow, plus the book value of specified lots of Allergan’s inventory of RHOFADE, which is estimated to be approximately $1,000. The Company has also agreed to pay Allergan a one-time payment of $5,000 upon the achievement of a specified development milestone related to the potential development of an additional dermatology product. In addition, the Company has agreed to pay Allergan specified royalties, ranging from a mid-single digit percentage to a mid-teen percentage of net sales, subject to specified reductions, limitations and other adjustments, on a country-by-country basis until the date that the patent rights related to a particular product, such as RHOFADE, have expired or, if later, ten years from the closing date of the Acquisition. In addition, the Company has agreed to assume the obligation to pay specified royalties and milestone payments under agreements with Aspect Pharmaceuticals, LLC and Vicept Therapeutics, Inc. Members of the Company’s management team, including Neal Walker, Frank Ruffo, Christopher Powala and Stuart Shanler, as well as Stephen Tullman, the chairman of the Company’s board of directors, are former stockholders of Vicept Therapeutics, Inc., and Dr. Shanler is also a current member of Aspect Pharmaceuticals, LLC. In their capacities as current or former holders of equity interests in these entities, these individuals may be entitled to receive a portion of the potential future payments payable by the Company. The APA contains customary representations and warranties, pre-closing covenants and indemnities. The closing of the Acquisition is subject to the satisfaction or waiver of a number of customary closing conditions in the APA, including, among others, the receipt of regulatory approval, the absence of certain governmental restraints and the absence of a material adverse effect on the Company or the RHOFADE assets. The APA may be terminated prior to the closing date by mutual written agreement of the Company and Allergan. In addition, the APA may be terminated by either the Company or Allergan in certain circumstances, including if the Acquisition has not closed by July 15, 2019, or if the other party has breached any representation, warranty, covenant, obligation or agreement such that certain of the conditions to closing cannot be satisfied. Loan and Security Agreement – Oxford Finance LLC On October 15, 2018, the Company and its wholly owned subsidiaries Confluence Discovery Technologies, Inc. and Aclaris Life Sciences, Inc. (together, the “Borrowers”) entered into a Loan and Security Agreement (“Loan Agreement”) with Oxford Finance LLC, a Delaware limited liability company (“Oxford”). The Loan Agreement provides for up to $65,000 in term loans (the “Term Loan Facility”). Of the $65,000, the Company borrowed $30,000 on October 31, 2018. The remaining $35,000 will become available to be borrowed beginning on the closing date of the Acquisition and ending on the earlier of March 31, 2019 or an event of default. Should the Borrowers not draw all of the Term Loan Facility, or if the Borrowers repay the entirety of the amount drawn during the applicable draw timeframe, the Borrowers will be required to pay a non-utilization fee equal to 1.0% of the undrawn portion of the Term Loan Facility. The Loan Agreement provides for interest only payments through November 1, 2021, followed by 24 consecutive equal monthly payments of principal and interest in arrears starting on November 1, 2021 and continuing through the maturity date of October 1, 2023. All unpaid principal and accrued and unpaid interest will be due and payable on the maturity date. The Loan Agreement provides for an annual interest rate equal to the greater of (i) 8.35% and (ii) the 30-day U.S. LIBOR rate, as reported in The Wall Street Journal on the last business day of the month that immediately precedes the month in which the interest will accrue, plus 6.25%. The Loan Agreement also provides for a final payment fee equal to 5.75% of the original principal amount of the term loans drawn under the Term Loan Facility, which final payment is due on October 1, 2023 or upon the prepayment of the facility or the acceleration of amounts due under the facility as a result of an event of default. The Borrowers have the option to prepay the outstanding balance of the term loans in full, subject to a prepayment fee of (i) 3% of the original principal amount of the aggregate term loans drawn for any prepayment prior to the first anniversary of the Funding Date (as defined in the Loan Agreement), (ii) 2% of the original principal amount of the aggregate term loans drawn for any prepayment between the first and second anniversaries of the Funding Date or (iii) 1% of the original principal amount of the aggregate term loans drawn for any prepayment after the second anniversary of the Funding Date but before October 1, 2023. The Borrowers also have the option to prepay the term loans in part, once in a three-month period, of an amount of $2,000 or greater, subject to the same prepayment fees and other specified limitations. The Term Loan Facility is secured by substantially all of the Borrowers’ assets, except that the collateral does not include the Borrowers’ intellectual property. However, the Borrowers have agreed not to encumber any of their intellectual property. The Loan Agreement contains customary representations, warranties and covenants by the Borrowers. The Loan Agreement also contains specified financial covenants related to minimum consolidated future revenues of the Borrowers. October 2018 Public Offering On October 17, 2018, the Company entered into an underwriting agreement pursuant to which the Company issued and sold 9,941,750 shares of common stock under registration statements on Form S-3, including the underwriters’ full exercise of their option to purchase additional shares. The shares of common stock were sold to the public at a price of $10.75 per share, for gross proceeds of $106,874. The Company paid underwriting discounts and commissions of $6,412 to the underwriters in connection with the offering.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2018
Summary of Significant Accounting Policies
Basis of Presentation	Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The condensed consolidated financial statements of the Company include the accounts of the operating parent company, Aclaris Therapeutics, Inc., and its wholly-owned subsidiaries, ATIL, Confluence and Vixen. All significant intercompany transactions have been eliminated.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting periods. Significant estimates and assumptions reflected in these financial statements include, but are not limited to, research and development expenses, contingent consideration and the valuation of stock-based awards. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Actual results could differ from the Company’s estimates.
Unaudited Interim Financial Information	Unaudited Interim Financial Information The accompanying condensed consolidated balance sheet as of September 30, 2018, the condensed consolidated statement of operations and comprehensive loss for the three and nine months ended September 30, 2018 and 2017, the condensed consolidated statement of stockholders’ equity for the nine months ended September 30, 2018, and the condensed consolidated statement of cash flows for the nine months ended September 30, 2018 and 2017 are unaudited. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited annual financial statements contained in the Company’s annual report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 12, 2018 and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the Company’s financial position as of September 30, 2018, the results of its operations and comprehensive loss for the three and nine months ended September 30, 2018 and 2017 and its cash flows for the nine months ended September 30, 2018 and 2017. The condensed consolidated balance sheet data as of December 31, 2017 was derived from audited financial statements but does not include all disclosures required by GAAP. The financial data and other information disclosed in these notes related to the three and nine months ended September 30, 2018 and 2017 are unaudited. The results for the three and nine months ended September 30, 2018 are not necessarily indicative of results to be expected for the year ending December 31, 2018, any other interim periods, or any future year or period. The unaudited interim financial statements of the Company included herein have been prepared, pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto for the year ended December 31, 2017 included in the Company’s annual report on Form 10-K filed with the SEC on March 12, 2018.
Significant Accounting Policies	Significant Accounting Policies The Company’s significant accounting policies are disclosed in the audited consolidated financial statements for the year ended December 31, 2017 included in the Company’s annual report on Form 10-K filed with the SEC on March 12, 2018. Since the date of such financial statements, there have been no changes to the Company’s significant accounting policies other than those noted below. In February 2017, the Company paid a $2,000 Prescription Drug User Fee Act (“PDUFA”) fee to the FDA in conjunction with the filing of its NDA for ESKATA. The Company requested a waiver and refund of this PDUFA fee, which was approved by the FDA in December 2017, and was received by the Company in January 2018.
Revenue Recognition	Revenue Recognition The Company accounts for revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. Under ASC Topic 606, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. To determine revenue recognition in accordance with ASC Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) performance obligations are satisfied. At contract inception, the Company assesses the goods or services promised within a contract with a customer to identify the performance obligations, and to determine if they are distinct. The Company recognizes the revenue that is allocated to each distinct performance obligation when (or as) that performance obligation is satisfied. The Company only recognizes revenue when collection of the consideration it is entitled to under a contract with a customer is probable. ESKATA Product Sales The Company sells ESKATA to McKesson Specialty Care Distribution (“McKesson”) which resells ESKATA to healthcare providers, group purchasing organizations (“GPOs”) and hospitals. The Company has entered into an agreement directly with one GPO, and may enter into additional agreements directly with other GPOs and corporate accounts, that provide for discounted pricing in the form of volume-based rebates and chargebacks, and administrative fees. The Company does not accept product returns. The Company recognizes revenue from sales of ESKATA at the point when control has transferred to the customer, which generally occurs when McKesson takes delivery of the product. The Company includes estimates for variable consideration, including rebates, chargebacks and administrative fees, as a reduction of revenue when it is recognized. Estimates of variable consideration include reserves for rebates, chargebacks and administrative fees related to units remaining in the distribution channel at McKesson. The Company considers all relevant factors when estimating variable consideration including the terms of current contracts, market trends, industry data and forecasted buying patterns as available and appropriate. The Company has determined that its arrangement with McKesson, its only direct customer, does not include a financing component since payment terms under the agreement do not exceed one year. The Company expenses incremental costs of contracts with direct and indirect customers, which generally include sales commissions, in the period they are incurred. Contract Research The Company earns revenue from the provision of laboratory services to clients through Confluence, its wholly-owned subsidiary. Laboratory service revenue is generally evidenced by contracts with clients which are on an agreed upon fixed-price, fee-for-service basis and are generally billed on a monthly basis in arrears for services rendered. Revenue related to these contracts is generally recognized as the laboratory services are performed, based upon the rates specified in the contracts. Under ASC Topic 606, the Company elected to apply the “right to invoice” practical expedient when recognizing laboratory service revenue. The Company recognizes laboratory service revenue in the amount to which it has the right to invoice. The Company has also received revenue from grants under the Small Business Innovation Research program of the National Institutes of Health (“NIH”). During the nine months ended September 30, 2018, the Company, through Confluence, its wholly-owned subsidiary, had two active grants from NIH which were related to early-stage research. As of September 30, 2018, there are no remaining funds available to the Company under the grants. The Company recognizes revenue related to grants as amounts become reimbursable under each grant, which is generally when research is performed, and the related costs are incurred.
Inventory	Inventory Inventory includes the third-party cost of manufacturing and assembly of the finished product form of ESKATA, quality control and other overhead costs. Inventory is stated at the lower of cost or net realizable value. Inventory is adjusted for short-dated, unmarketable inventory equal to the difference between the cost of inventory and the estimated value based upon assumptions about future demand and market conditions. The Company had $1,044 and $0 of inventory as of September 30, 2018 and December 31, 2017, respectively, which was comprised solely of finished goods.
Contingent Consideration	Contingent Consideration The Company initially recorded the contingent consideration related to future potential payments based upon the achievement of certain development, regulatory and commercial milestones, resulting from the acquisition of Confluence, at its estimated fair value on the date of acquisition. Changes in fair value reflect new information about the likelihood of the payment of the contingent consideration and the passage of time. For example, if the timing of the development of an acquired drug candidate, or the size of potential commercial opportunities related to an acquired drug, differ from the Company’s assumptions, then the fair value of contingent consideration would be adjusted accordingly. Future changes in the fair value of the contingent consideration, if any, will be recorded as income or expense in the Company’s condensed consolidated statement of operations.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40). ASU 2018-15 requires a customer in a cloud computing arrangement that is a service contract to follow the internal-use software guidance in ASC 350-40 to determine which implementation costs to capitalize as assets or expense as incurred. The standard will be effective for fiscal years beginning after December 15, 2019, including interim periods within such fiscal years, with early adoption permitted. The Company is evaluating the impact of ASU 2018-15 on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820). The FASB developed the amendments to ASC 820 as part of its broader disclosure framework project, which aims to improve the effectiveness of disclosures in the notes to financial statements by focusing on requirements that clearly communicate the most important information to users of the financial statements. This update eliminates certain disclosure requirements for fair value measurements for all entities, requires public entities to disclose certain new information and modifies some of the existing disclosure requirements. The standard will be effective for fiscal years beginning after December 15, 2019, including interim periods within such fiscal years, with early adoption permitted. The Company is evaluating the impact of ASU 2018-13 on its consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718). The amendments in this ASU expand the scope of Topic 718 to include stock-based compensation arrangements with nonemployees except for specific guidance on option pricing model inputs and cost attribution. ASU 2018-07 is effective for annual reporting periods beginning after December 31, 2018, including interim periods within that year, and early adoption is permitted. The Company is evaluating the impact of ASU 2018-07 on its consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Business Combinations-Clarifying the Definition of a Business (Topic 805). The amendments in this ASU provide a screen to determine when a set of acquired assets and/or activities is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired, or disposed of, is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. The amendments in this ASU will reduce the number of transactions that meet the definition of a business. ASU 2017-01 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those years, and early adoption will be permitted. The Company adopted the provisions of this standard on January 1, 2018, the impact of which on its consolidated financial statements was not significant. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). Under this ASU, entities should recognize revenue in an amount that reflects the consideration to which they expect to be entitled to in exchange for goods and services provided. ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2017. The Company adopted the provisions of this standard on January 1, 2018, using the modified retrospective transition method. The Company did not recognize any transition adjustments as a result of adopting ASU 2014-09 and, accordingly, comparative information has not been restated for the periods reported.

Acquisition of Confluence (Tabl

Acquisition of Confluence (Tables) - Confluence	9 Months Ended
	Sep. 30, 2018
Business Acquisition [Line Items]
Schedule of consideration transferred	Cash consideration paid $ 10,269 Aclaris common stock issued 9,675 Contingent consideration 4,378 Total fair value of consideration to Confluence equity holders $ 24,322
Schedule of pro forma information	Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Revenue $ 1,628 $ 1,063 $ 6,422 $ 3,366 Gross profit 435 298 3,081 1,102 Total operating expenses 33,885 18,736 99,457 48,122 Net loss (32,740) (17,875) (94,187) (45,627)

Fair Value of Financial Asset_2

Fair Value of Financial Assets and Liabilities (Tables)	9 Months Ended
	Sep. 30, 2018
Fair Value of Financial Assets and Liabilities
Schedule of assets and liabilities measured at fair value on a recurring basis	September 30, 2018 Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 24,583 $ — $ — $ 24,583 Marketable securities — 107,681 — 107,681 Total Assets $ 24,583 $ 107,681 $ — $ 132,264 Liabilities: Acquisition-related contingent consideration $ — $ — $ 5,244 $ 5,244 Total liabilities $ — $ — $ 5,244 $ 5,244 December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 19,339 $ — $ — $ 19,339 Marketable securities — 188,652 — 188,652 Total Assets $ 19,339 $ 188,652 $ — $ 207,991 Liabilities: Acquisition-related contingent consideration $ — $ — $ 4,378 $ 4,378 Total liabilities $ — $ — $ 4,378 $ 4,378
Schedule of the fair value of available for sale marketable securities	September 30, 2018 Gross Gross Amortized Unrealized Unrealized Fair Cost Gain Loss Value Marketable securities: Corporate debt securities $ 16,088 $ — $ (23) $ 16,065 Commercial paper 51,691 — — 51,691 Asset-backed securities 16,009 — (8) 16,001 U.S. government agency debt securities 23,952 — (28) 23,924 Total marketable securities $ 107,740 $ — $ (59) $ 107,681 December 31, 2017 Gross Gross Amortized Unrealized Unrealized Fair Cost Gain Loss Value Marketable securities: Corporate debt securities $ 37,401 $ — $ (68) $ 37,333 Commercial paper 85,202 — — 85,202 Asset-backed securities 16,708 — (13) 16,695 U.S. government agency debt securities 49,511 — (89) 49,422 Total marketable securities $ 188,822 $ — $ (170) $ 188,652

Property and Equipment, Net (Ta

Property and Equipment, Net (Tables)	9 Months Ended
	Sep. 30, 2018
Property and Equipment, Net
Schedule of property and equipment, net	September 30, December 31, 2018 2017 Computer equipment $ 1,338 $ 650 Fleet vehicles 2,076 — Manufacturing equipment 562 511 Lab equipment 928 721 Furniture and fixtures 524 327 Leasehold improvements 326 430 Property and equipment, gross 5,754 2,639 Accumulated depreciation (1,345) (480) Property and equipment, net $ 4,409 $ 2,159

Accrued Expenses (Tables)

Accrued Expenses (Tables)	9 Months Ended
	Sep. 30, 2018
Accrued Expenses
Schedule of accrued expenses	September 30, December 31, 2018 2017 Employee compensation expenses $ 4,219 $ 3,010 Sales and marketing expenses 833 39 Research and development expenses 1,900 627 Capital leases, current portion 591 142 Professional fees 336 108 Payable to NST — 590 Other 666 424 Total accrued expenses $ 8,545 $ 4,940

Stock-Based Awards (Tables)

Stock-Based Awards (Tables)	9 Months Ended
	Sep. 30, 2018
Stock-Based Awards
Assumptions used to determine fair value of stock options granted	Nine Months Ended September 30, 2018 2017 Risk-free interest rate 2.65 % 1.89 % Expected term (in years) 6.3 6.2 Expected volatility 96.56 % 93.84 % Expected dividend yield 0 % 0 %
Summary of stock option activity	Weighted Weighted Average Average Remaining Aggregate Number Exercise Contractual Intrinsic of Shares Price Term Value (in years) Outstanding as of December 31, 2017 3,328,757 $ 20.69 8.28 $ 19,812 Granted 1,397,900 21.25 Exercised (59,450) 9.70 Forfeited and cancelled (343,854) 24.82 Outstanding as of September 30, 2018 4,323,353 $ 20.69 8.10 $ 7,634 Options vested and expected to vest as of September 30, 2018 4,323,353 $ 20.69 8.10 $ 7,634 Options exercisable as of September 30, 2018 1,543,159 (1) $ 15.70 7.00 $ 6,785 (1) All options granted under the 2012 Plan are exercisable immediately, subject to a repurchase right in the Company’s favor that lapses as the option vests. This amount reflects the number of shares under options that were vested, as opposed to exercisable, as of September 30, 2018.
Summary of restricted stock units activity	Weighted Average Grant Date Number Fair Value of Shares Per Share Outstanding as of December 31, 2017 283,553 $ 27.02 Granted 419,160 21.12 Vested (106,202) 26.89 Forfeited and cancelled (54,883) 23.76 Outstanding as of September 30, 2018 541,628 $ 22.81
Stock-based compensation expense	Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Cost of revenue $ 194 $ 130 $ 560 $ 130 Research and development 1,433 1,332 4,916 3,853 Sales and marketing 760 480 2,687 1,260 General and administrative 2,320 1,731 6,936 4,887 Total stock-based compensation expense $ 4,707 $ 3,673 $ 15,099 $ 10,130

Net Loss per Share (Tables)

Net Loss per Share (Tables)	9 Months Ended
	Sep. 30, 2018
Net Loss per Share
Basic and diluted net loss per share	Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Numerator: Net loss $ (32,740) $ (18,192) $ (94,187) $ (45,589) Denominator: Weighted average shares of common stock outstanding 30,982,192 28,834,808 30,938,026 27,180,244 Net loss per share, basic and diluted $ (1.06) $ (0.63) $ (3.04) $ (1.68)
Potential common shares excluded from the calculation of diluted net loss per share attributable to common stockholders	September 30, 2018 2017 Options to purchase common stock 4,323,353 3,242,831 Restricted stock unit awards 541,628 294,331 Total potential shares of common stock 4,864,981 3,537,162

Commitments and Contingencies (

Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2018
Commitments and Contingencies
Schedule of future minimum lease payments	Year Ending December 31, 2018 $ 312 2019 1,100 2020 1,037 2021 1,054 2022 791 Thereafter 531 Total $ 4,825

Related Party Transactions (Tab

Related Party Transactions (Tables)	9 Months Ended
	Sep. 30, 2018
Related Party Transactions
Schedule of related party amounts included in the statement of operations and comprehensive loss	Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Services provided by NST Consulting, LLC $ — $ 49 $ — $ 161 Services provided to NST Consulting, LLC — — — (18) General and administrative expense, net $ — $ 49 $ — $ 143 Net payments made to NST Consulting, LLC $ — $ 35 $ — $ 218

Segments (Tables)

Segments (Tables)	9 Months Ended
	Sep. 30, 2018
Segments
Summary of results of operations by segment	Dermatology Contract Corporate Total Three Months Ended September 30, 2018 Therapeutics Research and Other Company Revenue, net $ 510 $ 3,225 $ (2,107) $ 1,628 Cost of revenue 126 2,823 (1,756) 1,193 Research and development 15,931 — — 15,931 Sales and marketing 11,366 14 — 11,380 General and administrative — 566 6,008 6,574 Loss from operations $ (26,913) $ (178) $ (6,359) $ (33,450) Dermatology Contract Corporate Total Three Months Ended September 30, 2017 Therapeutics Research and Other Company Revenue, net $ — $ 1,212 $ (528) $ 684 Cost of revenue — 893 (440) 453 Research and development 10,864 — — 10,864 Sales and marketing 3,555 2 — 3,557 General and administrative 72 196 4,298 4,566 Loss from operations $ (14,491) $ 121 $ (4,386) $ (18,756) Dermatology Contract Corporate Total Nine Months Ended September 30, 2018 Therapeutics Research and Other Company Revenue, net $ 3,043 $ 8,779 $ (5,400) $ 6,422 Cost of revenue 278 7,564 (4,501) 3,341 Research and development 43,472 — — 43,472 Sales and marketing 34,996 34 — 35,030 General and administrative — 1,557 19,398 20,955 Loss from operations $ (75,703) $ (376) $ (20,297) $ (96,376) Dermatology Contract Corporate Total Nine Months Ended September 30, 2017 Therapeutics Research and Other Company Revenue, net $ — $ 1,212 $ (528) $ 684 Cost of revenue — 893 (440) 453 Research and development 26,601 — — 26,601 Sales and marketing 7,181 2 — 7,183 General and administrative 223 195 13,010 13,428 Loss from operations $ (34,005) $ 122 $ (13,098) $ (46,981)

Organization and Nature of Bu_2

Organization and Nature of Business (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Organization and Nature of Business
Cash, cash equivalents and marketable securities	$ 134,271
Accumulated deficit	$ 253,622	$ 159,435

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2018USD ($)item	Dec. 31, 2017USD ($)	Feb. 28, 2017USD ($)
Summary of Significant Accounting Policies
PDUFA fee paid, later refunded			$ 2,000
Revenue Recognition
Revenue, Remaining Performance Obligation, Optional Exemption, Performance Obligation [true false]	true
Revenue, Practical Expedient, Financing Component [true false]	true
Number of active research grants | item	2
Remaining funds available to the Company under grants	$ 0
Inventory
Finished goods inventory	$ 1,044	$ 0

Summary of Significant Accoun_4

Summary of Significant Accounting Policies - Recent Pronouncements (Details) - USD ($)	Sep. 30, 2018	Jan. 01, 2018	Dec. 31, 2017
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Cumulative effect recognized on initial adoption of the new guidance	$ (253,622,000)		$ (159,435,000)
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Cumulative effect recognized on initial adoption of the new guidance		$ 0

Acquisition of Confluence - Sum

Acquisition of Confluence - Summary of fair value consideration (Details) - USD ($) $ in Thousands	1 Months Ended	9 Months Ended
	Aug. 31, 2017	Sep. 30, 2017
Fair value of consideration
Cash consideration paid		$ 9,647
Confluence
Business Acquisition [Line Items]
Additional contingent consideration based on milestones, maximum, per Agreement	$ 80,000
Additional contingent consideration based on milestones, portion payable in shares	$ 2,500
Royalty term	10 years
Fair value of consideration
Cash consideration paid	$ 10,269
Aclaris common stock issued	9,675
Contingent consideration	4,378
Total fair value of consideration to Confluence equity holders	$ 24,322

Acquisition of Confluence - Sup

Acquisition of Confluence - Supplemental pro forma financial information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Acquisition-related expenses
Business Acquisition [Line Items]
Net loss		$ 997		$ 1,351
Confluence
Business Acquisition [Line Items]
Revenue	$ 1,628	1,063	$ 6,422	3,366
Gross profit	435	298	3,081	1,102
Total operating expenses	33,885	18,736	99,457	48,122
Net loss	$ (32,740)	(17,875)	$ (94,187)	(45,627)
Confluence | Billed revenues
Business Acquisition [Line Items]
Net loss		$ (217)		$ (888)

Fair Value of Financial Asset_3

Fair Value of Financial Assets and Liabilities (Detail) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Assets:
Marketable securities	$ 107,681	$ 188,652
Liabilities:
Transfers from Level 1 to Level 2	0	0
Transfers from Level 2 to Level 1	0	0
Transfers into or out of Level 3	0	0
Change in fair value of contingent consideration	866
Recurring
Assets:
Cash equivalents	24,583	19,339
Marketable securities	107,681	188,652
Total assets measured at fair value	132,264	207,991
Liabilities:
Acquisition-related contingent consideration	5,244	4,378
Total liabilities measured at fair value	5,244	4,378
Recurring | Level 1
Assets:
Cash equivalents	24,583	19,339
Total assets measured at fair value	24,583	19,339
Recurring | Level 2
Assets:
Marketable securities	107,681	188,652
Total assets measured at fair value	107,681	188,652
Recurring | Level 3
Liabilities:
Acquisition-related contingent consideration	5,244	4,378
Total liabilities measured at fair value	$ 5,244	$ 4,378

Fair Value of Financial Asset_4

Fair Value of Financial Assets and Liabilities - By type (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Marketable securities:
Amortized Cost	$ 107,740	$ 188,822
Gross Unrealized Loss	(59)	(170)
Fair Value	107,681	188,652
Corporate debt securities
Marketable securities:
Amortized Cost	16,088	37,401
Gross Unrealized Loss	(23)	(68)
Fair Value	16,065	37,333
Commercial paper
Marketable securities:
Amortized Cost	51,691	85,202
Fair Value	51,691	85,202
Asset-backed securities
Marketable securities:
Amortized Cost	16,009	16,708
Gross Unrealized Loss	(8)	(13)
Fair Value	16,001	16,695
U.S. government agency debt securities
Marketable securities:
Amortized Cost	23,952	49,511
Gross Unrealized Loss	(28)	(89)
Fair Value	$ 23,924	$ 49,422

Property and Equipment, Net (De

Property and Equipment, Net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Property and Equipment, Net
Property and equipment, gross	$ 5,754		$ 5,754		$ 2,639
Accumulated depreciation	(1,345)		(1,345)		(480)
Property and equipment, net	4,409		4,409		2,159
Depreciation	366	$ 103	865	$ 208
Computer equipment
Property and Equipment, Net
Property and equipment, gross	1,338		1,338		650
Fleet vehicles
Property and Equipment, Net
Property and equipment, gross	2,076		2,076
Manufacturing equipment
Property and Equipment, Net
Property and equipment, gross	562		562		511
Lab equipment
Property and Equipment, Net
Property and equipment, gross	928		928		721
Furniture and fixtures
Property and Equipment, Net
Property and equipment, gross	524		524		327
Leasehold improvements
Property and Equipment, Net
Property and equipment, gross	$ 326		$ 326		$ 430

Accrued Expenses (Details)

Accrued Expenses (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Accrued Expenses
Employee compensation expenses	$ 4,219	$ 3,010
Sales and marketing expenses	833	39
Research and development expenses	1,900	627
Capital leases, current portion	591	142
Professional fees	336	108
Payable to NST		590
Other	666	424
Total accrued expenses	$ 8,545	$ 4,940

Stockholders' Equity (Details)

Stockholders' Equity (Details)	9 Months Ended
	Sep. 30, 2018USD ($)Vote$ / sharesshares	Dec. 31, 2017$ / sharesshares
Stockholders' Equity
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares outstanding	0	0
Common stock, shares authorized	100,000,000	100,000,000
Common stock, par value (in dollars per share) | $ / shares	$ 0.00001	$ 0.00001
Number of votes per share | Vote	1
Dividends declared | $	$ 0

Stockholders' Equity - Other Of

Stockholders' Equity - Other Offerings (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	9 Months Ended		23 Months Ended
	Aug. 31, 2017	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Dec. 31, 2017
Subsidiary, Sale of Stock [Line Items]
Common stock, shares outstanding		30,991,060		30,991,060	30,856,505
Underwriters' discounts and commissions	$ 5,176
At The Market Offering
Subsidiary, Sale of Stock [Line Items]
Number of shares issued		0
Common stock, shares outstanding		635,000		635,000
Issuance price (in dollars per share)				$ 31.50
Aggregate gross proceeds				$ 20,003
Expenses related to stock issuance		$ 691
Net offering proceeds			$ 19,311
Public Offering August 2017
Subsidiary, Sale of Stock [Line Items]
Number of shares issued	3,747,602
Issuance price (in dollars per share)	$ 23.02
Aggregate gross proceeds	$ 86,270
Expenses related to stock issuance	176
Net offering proceeds	$ 80,918		$ 80,918

Stock-Based Awards (Details)

Stock-Based Awards (Details) - shares	Jan. 01, 2018	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2014	Dec. 31, 2017	Jul. 31, 2017	Sep. 30, 2015
Stock-based awards
Options granted (in shares)		1,397,900
Options outstanding		4,323,353			3,328,757
Stock Option Valuation
Risk-free interest rate (as a percent)		2.65%	1.89%
Expected term (in years)		6 years 3 months 18 days	6 years 2 months 12 days
Expected volatility (as a percent)		96.56%	93.84%
Expected dividend yield (as a percent)		0.00%	0.00%
2017 Inducement Plan
Stock-based awards
Number of shares authorized						1,000,000
Number of shares available for grant		22,471
2015 Equity Incentive Plan
Stock-based awards
Number of shares authorized							1,643,872
Number of shares available for grant		1,718,918
Percentage increase to shares available for grant from common outstanding as of preceding December 31 (as a percent)		4.00%
Additional shares available	1,234,260
2012 Equity Compensation Plan
Stock-based awards
Number of shares available for grant		0
Options granted (in shares)				1,140,524
Options outstanding		951,905			984,720
Vesting period (in years)		4 years
Term of award (in years)		10 years

Stock-Based Awards - Option Act

Stock-Based Awards - Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Options, Number of Shares
Number of Shares, beginning balance	3,328,757
Number of Shares, Granted	1,397,900
Number of Shares, Exercised	(59,450)
Number of Shares, Forfeited and cancelled	(343,854)
Number of Shares, ending balance	4,323,353	3,328,757
Number of Shares, Options vested and expected to vest	4,323,353
Number of Shares, Options exercisable	1,543,159
Options, Weighted Average Exercise Price
Weighted Average Exercise Price, beginning balance (in dollars per share)	$ 20.69
Weighted Average Exercise Price, Granted (in dollars per share)	21.25
Weighted Average Exercise Price, Exercised (in dollars per share)	9.70
Weighted Average Exercise Price, Forfeited and cancelled (in dollars per share)	24.82
Weighted Average Exercise Price, ending balance (in dollars per share)	20.69	$ 20.69
Weighted Average Exercise Price, Options vested and expected to vest (in dollars per share)	20.69
Weighted Average Exercise Price, Options exercisable (in dollars per share)	$ 15.70
Options, Weighted Average Remaining Contractual Term
Weighted Average Remaining Contractual Term (in years)	8 years 1 month 6 days	8 years 3 months 11 days
Weighted Average Remaining Contractual Term, Options vested and expected to vest (in years)	8 years 1 month 6 days
Weighted Average Remaining Contractual Term, Options exercisable (in years)	7 years
Aggregate Intrinsic Value
Aggregate Intrinsic Value	$ 7,634	$ 19,812
Aggregate Intrinsic Value, Options vested and expected to vest	7,634
Aggregate Intrinsic Value, Options exercisable	$ 6,785
Weighted average grant-date fair value of stock options granted (in dollars per share)	$ 16.75

Stock-Based Awards - RSUs (Deta

Stock-Based Awards - RSUs (Details)	9 Months Ended
	Sep. 30, 2018$ / sharesshares
RSU, Number of Units
Units outstanding, beginning of period | shares	283,553
Granted | shares	419,160
Vested | shares	(106,202)
Forfeited and cancelled | shares	(54,883)
Units outstanding, end of period | shares	541,628
RSU, Weighted Average Grant Date Fair Value Per Unit
Weighted average grant date fair value, beginning balance (in dollars per share) | $ / shares	$ 27.02
Granted, estimated grant-date fair value (in dollars per share) | $ / shares	21.12
Weighted average grant date fair value, vested (in dollars per share) | $ / shares	26.89
Forfeited and cancelled, estimated grant date fair value (in dollars per share) | $ / shares	23.76
Weighted average grant date fair value, ending balance (in dollars per share) | $ / shares	$ 22.81

Stock-Based Awards - Compensati

Stock-Based Awards - Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Stock-based compensation expense
Stock-based compensation expense	$ 4,707	$ 3,673	$ 15,099	$ 10,130
Unrecognized stock-based compensation cost, options	40,938		40,938
Unrecognized compensation, RSUs	10,222		$ 10,222
Weighted average recognition period unrecognized stock-based compensation cost (in years)			2 years 8 months 23 days
Cost of revenue.
Stock-based compensation expense
Stock-based compensation expense	194	130	$ 560	130
Research and development
Stock-based compensation expense
Stock-based compensation expense	1,433	1,332	4,916	3,853
Sales and marketing
Stock-based compensation expense
Stock-based compensation expense	760	480	2,687	1,260
General and administrative
Stock-based compensation expense
Stock-based compensation expense	$ 2,320	$ 1,731	$ 6,936	$ 4,887
Options to Purchase Common Stock
Stock-based compensation expense
Weighted average recognition period unrecognized stock-based compensation cost (in years)			2 years 8 months 23 days
Restricted Stock Unit Awards
Stock-based compensation expense
Weighted average recognition period unrecognized stock-based compensation cost (in years)			3 years 1 month 6 days

Net Loss per Share (Details)

Net Loss per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Numerator:
Net loss	$ (32,740)	$ (18,192)	$ (94,187)	$ (45,589)
Denominator:
Weighted average common shares outstanding used in calculating net loss per share attributable to common stockholders, basic and diluted	30,982,192	28,834,808	30,938,026	27,180,244
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ (1.06)	$ (0.63)	$ (3.04)	$ (1.68)

Net Loss per Share - Anti-dilut

Net Loss per Share - Anti-dilution (Details) - shares	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potential common shares excluded from the calculation of diluted net loss per share attributable to common stockholders	4,864,981	3,537,162
Options to Purchase Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potential common shares excluded from the calculation of diluted net loss per share attributable to common stockholders	4,323,353	3,242,831
Restricted Stock Unit Awards
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potential common shares excluded from the calculation of diluted net loss per share attributable to common stockholders	541,628	294,331

Commitments and Contingencies_2

Commitments and Contingencies (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018USD ($)ft²	Sep. 30, 2017USD ($)	Sep. 30, 2018USD ($)ft²item	Sep. 30, 2017USD ($)
Agreements for Office Space
Area leased from third party | ft²	33,019		33,019
Rent expense under operating leases	$ 204	$ 110	$ 682	$ 284
Contractual Obligation, Fiscal Year Maturity [Abstract]
2,018	312		312
2,019	1,100		1,100
2,020	1,037		1,037
2,021	1,054		1,054
2,022	791		791
Thereafter	531		531
Total	$ 4,825		$ 4,825
Number of capital lease arrangements | item			2
Capital lease term			4 years

Related Party Transactions (Det

Related Party Transactions (Details) $ in Thousands	1 Months Ended	3 Months Ended	9 Months Ended
	Nov. 30, 2017USD ($)	Sep. 30, 2017USD ($)	Sep. 30, 2018USD ($)item	Sep. 30, 2017USD ($)	Dec. 31, 2017USD ($)
NST, LLC
Related Party Transactions
Number of executive officers affiliated with counterparty | item			3
Direct sublease agreement | NST, LLC
Related Party Transactions
Lease termination charge	$ 590
Expenses incurred under related party transactions			$ 570	$ 231
Services agreement | General and administrative
Related Party Transactions
Net expenses (revenues) from related party transactions		$ 49		143
Services agreement | NST, LLC
Related Party Transactions
Amount due to related party			$ 0		$ 570
Net payments made to NST Consulting, LLC				218
Payments to related party		35
Services agreement | NST, LLC | General and administrative
Related Party Transactions
Expenses incurred under related party transactions		$ 49		161
Other revenue earned from related party transactions				$ (18)

Agreements Related to Intelle_2

Agreements Related to Intellectual Property (Details) - USD ($) $ in Thousands	Apr. 18, 2018	May 31, 2018	Apr. 30, 2017	Aug. 31, 2012	Sep. 30, 2018
Assignment Agreement and Finder's Services Agreement
Agreements Related to Intellectual Property
Term of agreement, minimum				15 years
Assignment Agreement and Finder's Services Agreement | Achievement Of Specified Commercial Milestones
Agreements Related to Intellectual Property
Milestone Expenses		$ 1,500
Assignment Agreement and Finder's Services Agreement | Achievement Of Specified Regulatory Milestones
Agreements Related to Intellectual Property
Milestone Expenses			$ 1,000
Finders Services Agreement | Achievement Of Specified Commercial Milestones
Agreements Related to Intellectual Property
Potential Milestones Payable					$ 3,000
Aggregate royalty payments					82
License and collaboration agreement
Agreements Related to Intellectual Property
Upfront payment revenue					$ 1,000
Term of agreement, minimum	15 years
License and collaboration agreement | Achievement Of Specified Commercial Milestones
Agreements Related to Intellectual Property
Potential Milestones Receivable	$ 1,750
License and collaboration agreement | Achievement Of Development Milestones
Agreements Related to Intellectual Property
Potential Milestones Receivable	$ 1,000

Income Taxes - Rate reconciliat

Income Taxes - Rate reconciliation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Taxes
Federal income tax benefit	$ 0	$ 0	$ 0	$ 0
State income tax benefit	$ 0	$ 0	$ 0	$ 0

Segments (Details)

Segments (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018USD ($)	Sep. 30, 2017USD ($)	Sep. 30, 2018USD ($)item	Sep. 30, 2017USD ($)	Dec. 31, 2017USD ($)
Segment Reporting Information [Line Items]
Number of Reportable Segments | item			2
Revenue, net	$ 1,628	$ 684	$ 6,422	$ 684
Cost of revenue	1,193	453	3,341	453
Research and development	15,931	10,864	43,472	26,601
Sales and marketing	11,380	3,557	35,030	7,183
General and administrative	6,574	4,566	20,955	13,428
Loss from operations	(33,450)	(18,756)	(96,376)	(46,981)
UNITED KINGDOM
Segment Reporting Information [Line Items]
Net assets	38		38		$ 175
Dermatology Therapeutics Segment
Segment Reporting Information [Line Items]
Revenue, net	510		3,043
Cost of revenue	126		278
Research and development	15,931	10,864	43,472	26,601
Sales and marketing	11,366	3,555	34,996	7,181
General and administrative		72		223
Loss from operations	(26,913)	(14,491)	(75,703)	(34,005)
Contract Research Segment
Segment Reporting Information [Line Items]
Revenue, net	3,225	1,212	8,779	1,212
Cost of revenue	2,823	893	7,564	893
Sales and marketing	14	2	34	2
General and administrative	566	196	1,557	195
Loss from operations	(178)	121	(376)	122
Corporate and Other
Segment Reporting Information [Line Items]
Revenue, net	(2,107)	(528)	(5,400)	(528)
Cost of revenue	(1,756)	(440)	(4,501)	(440)
General and administrative	6,008	4,298	19,398	13,010
Loss from operations	(6,359)	(4,386)	(20,297)	(13,098)
Intersegment Eliminations | Contract Research Segment
Segment Reporting Information [Line Items]
Revenue, net	$ (2,107)	$ (528)	$ (5,400)	$ (528)

Subsequent Events (Details)

Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Thousands	Oct. 31, 2018	Oct. 17, 2018	Oct. 15, 2018	Aug. 31, 2017
Subsequent events
Underwriters' discounts and commissions				$ 5,176
Subsequent event | Secured Debt
Subsequent events
Loan, maximum borrowing capacity			$ 65,000
Proceeds from secured debt	$ 30,000
Loan, capacity not available due to restrictions			$ 35,000
Loan, unused capacity fee percentage			1.00%
Number of consecutive monthly payments			24 months
Final payment fee percentage			5.75%
Part prepayment period			3 months
Subsequent event | Minimum | Secured Debt
Subsequent events
Annual interest rate			8.35%
Part prepayment amount			$ 2,000
Subsequent event | Public Offering October 2018
Subsequent events
Number of shares issued		9,941,750
Issuance price (in dollars per share)		$ 10.75
Aggregate gross proceeds		$ 106,874
Underwriters' discounts and commissions		$ 6,412
Subsequent event | Prepayment prior to the first anniversary of the Funding Date | Secured Debt
Subsequent events
Prepayment fee percentage			3.00%
Subsequent event | Prepayment between the first and second anniversaries of the Funding Date | Secured Debt
Subsequent events
Prepayment fee percentage			2.00%
Subsequent event | Prepayment after the second anniversary of the Funding Date but before October 1, 2023 | Secured Debt
Subsequent events
Prepayment fee percentage			1.00%
Subsequent event | London Interbank Offered Rate (LIBOR) | Secured Debt
Subsequent events
Basis spread over LIBOR			6.25%
Subsequent event | APA
Subsequent events
Period for payment of royalties			10 years
Subsequent event | APA | Scenario, Forecast
Subsequent events
Portion of consideration to be paid at closing			$ 58,500
Portion of cash consideration paid into escrow			6,500
Cash consideration			65,000
Consideration for product inventory			1,000
Potential milestones payable			$ 5,000