DEI Document
DEI Document - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 15, 2019 | |
Entity [Abstract] | ||
Entity Registrant Name | Menlo Therapeutics Inc. | |
Entity Central Index Key | 0001566044 | |
Trading Symbol | MNLO | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 23,928,779 |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 61,958 | $ 49,510 |
Short-term investments | 59,558 | 86,740 |
Prepaid expenses and other current assets | 3,706 | 3,250 |
Total current assets | 125,222 | 139,500 |
Property and equipment, net | 143 | 146 |
Prepaid and other long-term assets | 223 | 282 |
Right-of-use asset | 670 | |
Total assets | 126,258 | 139,928 |
Current liabilities: | ||
Accounts payable | 3,782 | 3,290 |
Accrued expenses and other current liabilities | 6,161 | 6,254 |
Lease liability | 684 | |
Total current liabilities | 10,627 | 9,544 |
Other non-current liabilities | 7 | |
Total liabilities | 10,627 | 9,551 |
Commitments and contingencies (see Note 7) | ||
Stockholders’ equity: | ||
Preferred stock: $0.0001 par value; 20,000,000 shares authorized at March 31, 2019 and December 31, 2018, respectively; no shares issued and outstanding at March 31, 2019 and December 31, 2018 | ||
Common stock: $0.0001 par value; 300,000,000 shares authorized at March 31, 2019 and December 31, 2018, respectively; 23,672,235 and 22,233,184 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively | 3 | 3 |
Additional paid-in capital | 245,147 | 241,106 |
Accumulated other comprehensive loss | (10) | (96) |
Accumulated deficit | (129,509) | (110,636) |
Total stockholders’ equity | 115,631 | 130,377 |
Total liabilities and stockholders’ equity | $ 126,258 | $ 139,928 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
Common stock, par value per share (in USD per share) | $ 0.0001 | $ 0.0001 |
Common stock authorized (shares) | 300,000,000 | 300,000,000 |
Common stock issued (shares) | 23,672,235 | 22,233,184 |
Common stock outstanding (shares) | 23,672,235 | 22,233,184 |
Series A Convertible Preferred Stock | ||
Convertible preferred stock, par value per share (in USD per share) | $ 0.0001 | $ 0.0001 |
Convertible preferred stock authorized (shares) | 20,000,000 | 20,000,000 |
Convertible preferred stock issued (shares) | 0 | 0 |
Convertible preferred stock outstanding (shares) | 0 | 0 |
Condensed Statements of Operati
Condensed Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Income Statement [Abstract] | ||
Collaboration and license revenue | $ 497 | |
Type of Revenue [Extensible List] | us-gaap:LicenseAndServiceMember | us-gaap:LicenseAndServiceMember |
Operating expenses: | ||
Research and development | $ 15,923 | $ 11,020 |
General and administrative | 3,746 | 2,697 |
Total operating expenses | 19,669 | 13,717 |
Loss from operations | (19,669) | (13,220) |
Interest income and other expense, net | 796 | 563 |
Net loss | (18,873) | (12,657) |
Other comprehensive loss: | ||
Unrealized gain (loss) on available-for-sale securities | 86 | (151) |
Comprehensive loss | $ (18,787) | $ (12,808) |
Net loss attributable to common stockholders per share, basic and diluted | $ (0.81) | $ (0.72) |
Weighted-average number of common shares used to compute basic and diluted net loss per share | 23,286,282 | 17,583,377 |
Condensed Statements of Convert
Condensed Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | At-The-Market Offering | Series A Convertible Preferred Stock | Series B Convertible Preferred Stock | Series C Convertible Preferred Stock | Common Stock | Common StockAt-The-Market Offering | Additional Paid-in Capital | Additional Paid-in CapitalAt-The-Market Offering | Accumulated Deficit | Other Comprehensive Loss |
Balance, beginning at Dec. 31, 2017 | $ (57,034) | $ 14,183 | $ 44,820 | $ 50,324 | $ 1 | $ 2,207 | $ (59,191) | $ (51) | |||
Balance, beginning (shares) at Dec. 31, 2017 | 14,300 | 14,106,583 | 11,854,463 | 5,298,593 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Conversion of preferred stock to common stock | 109,327 | $ (14,183) | $ (44,820) | $ (50,324) | $ 1 | 109,326 | |||||
Conversion of preferred stock to common stock (shares) | (14,300) | (14,106,583) | (11,854,463) | 9,629,405 | |||||||
Issuance of common stock | 125,389 | $ 1 | 125,388 | ||||||||
Issuance of common stock (shares) | 8,050,000 | ||||||||||
Vesting of early exercised stock options | 6 | 6 | |||||||||
Stock-based compensation | 822 | 822 | |||||||||
Unrealized gain (loss) on available-for-sale securities | (151) | (151) | |||||||||
Net loss | (12,657) | (12,657) | |||||||||
Balance, ending at Mar. 31, 2018 | 165,702 | $ 3 | 237,749 | (71,848) | (202) | ||||||
Balance, ending (shares) at Mar. 31, 2018 | 22,977,998 | ||||||||||
Balance, beginning at Dec. 31, 2018 | 130,377 | $ 3 | 241,106 | (110,636) | (96) | ||||||
Balance, beginning (shares) at Dec. 31, 2018 | 23,233,184 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Issuance of common stock on exercise of stock options | $ 83 | 83 | |||||||||
Issuance of common stock on exercise of stock options (shares) | 34,418 | 34,418 | |||||||||
Issuance of common stock under Employee Stock Purchase Plan | $ 300 | 300 | |||||||||
Issuance of common stock under Employee Stock Purchase Plan, (shares) | 46,019 | ||||||||||
Issuance of common stock | $ 2,632 | $ 2,632 | |||||||||
Issuance of common stock (shares) | 358,614 | ||||||||||
Vesting of early exercised stock options | 7 | 7 | |||||||||
Stock-based compensation | 1,019 | 1,019 | |||||||||
Unrealized gain (loss) on available-for-sale securities | 86 | 86 | |||||||||
Net loss | (18,873) | (18,873) | |||||||||
Balance, ending at Mar. 31, 2019 | $ 115,631 | $ 3 | $ 245,147 | $ (129,509) | $ (10) | ||||||
Balance, ending (shares) at Mar. 31, 2019 | 23,672,235 |
Condensed Statements of Conve_2
Condensed Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) (Parenthetical) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Statement Of Stockholders Equity [Abstract] | |
Commissions and offering costs | $ 229 |
Condensed Statement of Cash Flo
Condensed Statement of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Operating activities | ||
Net loss | $ (18,873) | $ (12,657) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 14 | 5 |
Amortization of right-of-use-asset | 177 | |
Amortization of premium on investment securities | (240) | (123) |
Stock-based compensation expense | 1,019 | 822 |
Change in operating assets and liabilities: | ||
Accounts receivable | 552 | |
Prepaid expenses and other current assets | (456) | 75 |
Other long-term assets | 59 | (85) |
Accounts payable | 493 | 1,039 |
Accrued expenses and other current liabilities | (87) | (385) |
Lease liability | (163) | |
Deferred revenue | (449) | |
Other non-current liabilities | (7) | 4 |
Net cash used in operating activities | (18,064) | (11,202) |
Investing activities | ||
Purchase of property plant and equipment | (11) | |
Purchase of investments | (21,399) | (72,778) |
Proceeds from sales of investments | 7,792 | 4,100 |
Proceeds from maturities of investments | 41,115 | 22,812 |
Net cash provided by (used in) investing activities | 27,497 | (45,866) |
Financing activities | ||
Proceeds from issuance of common stock, net of issuance costs | 2,632 | 125,389 |
Proceeds from purchases under the Employee Stock Purchase Plan | 300 | |
Proceeds from the exercise of stock options | 83 | |
Net cash provided by financing activities | 3,015 | 125,389 |
Net increase in cash and cash equivalents | 12,448 | 68,321 |
Cash and cash equivalents at beginning of period | 49,510 | 10,206 |
Cash and cash equivalents at end of period | 61,958 | 78,527 |
Non-cash financing activities | ||
Addition of right-of-use-asset | $ 847 | |
Conversion of preferred stock to common stock | $ 109,327 |
Formation and Business of the C
Formation and Business of the Company | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Formation and Business of the Company | 1. Formation and Business of the Company Menlo Therapeutics Inc. (the “Company”) is a late‑stage biopharmaceutical company focused on the development and commercialization of serlopitant for the treatment of pruritus, or itch, associated with various conditions such as prurigo nodularis, psoriasis and chronic pruritus of unknown origin, or CPUO. The Company believes serlopitant, a highly selective small molecule inhibitor of the neurokinin 1 receptor, or NK1-R, given as a once-daily, oral tablet, has the potential to significantly alleviate pruritus. The Company was incorporated in Delaware in October 2011. Since commencing operations, the Company has devoted substantially all of its resources to developing its product candidate, serlopitant, including conducting clinical trials and providing general and administrative support for these operations. Shelf Registration Statement and At-the-Market Offering On February 1, 2019, the Company filed a shelf registration statement on Form S-3, which permitted: (a) the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $150.0 million of its common stock, preferred stock, debt securities, warrants, purchase contracts and/or units; and (b) as part of the $150.0 million, the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $50.0 million of its common stock that may be issued and sold under a sales agreement with Cantor Fitzgerald & Co in one or more at-the-market offerings In March 2019, the Company issued 358,614 shares of its common stock pursuant to the Company’s at-the-market offering program at an average price of $8.08 per share for aggregate offering proceeds of $3.0 million and aggregate net proceeds of $2.9 million, after deducting sales agent fees and before offering costs. In April 2019, the Company issued 244,316 shares of its common stock pursuant to the at-the-market offering program at an average price of $7.83 per share for aggregate offering proceeds of $1.9 million and aggregate net proceeds of $1.8 million, after deducting sales agent fees and total year-to-date aggregate net proceeds under the at-the-market offering program of $4.7 million. Initial Public Offering In January 2018, the Company completed its initial public offering (“IPO”) of shares of its common stock, pursuant to which the Company issued 8,050,000 shares of common stock, which includes 1,050,000 shares issued pursuant to the underwriter’s option to purchase additional shares, and received net proceeds of approximately $125.4 million, after deducting underwriting discounts, commissions and offering expenses. In connection with the completion of the Company's IPO, all shares of convertible preferred stock converted into 9,629,405 shares of common stock. Liquidity and Capital Resources The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The financial statements do not reflect any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary if the Company is unable to continue as a going concern. Since inception, the Company has incurred losses and negative cash flows from operations. For the three months ended March 31, 2019, the Company incurred a net loss of $18.9 million and used Management expects to continue to incur additional substantial losses in the foreseeable future as the Company continues its development, seeks regulatory approval of, and, if approved, begins to commercialize serlopitant. Management plans to finance operations through equity or debt financings or other capital sources, including potential collaborations or other strategic transactions. There can be no assurances that, in the event that the Company requires additional financing, such financing will be available on terms which are favorable to the Company, or at all. If the Company is unable to raise additional funding to meet its working capital needs in the future, it will be forced to delay or reduce the scope of its research programs and/or limit or cease its operations. The Company believes that its existing cash, cash equivalents and investments as of March 31, 2019 will provide sufficient funds to enable it to meet its obligations for at least the next 12 months from the issuance of our financial statements as of and for the three months ended March 31, 2019. |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies Basis of Presentation The accompanying financial information for the three months ended March 31, 2019 and 2018 is unaudited. These unaudited interim condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In management’s opinion, the unaudited interim condensed financial statements have been prepared on the same basis as the audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, and include all adjustments, which include only normal and recurring adjustments necessary for the fair presentation of the Company’s condensed balance sheet as of March 31, 2019, its condensed statements of operations and comprehensive loss for the three months ended March 31, 2019 and 2018, its condensed statements of convertible preferred stock and stockholders’ equity (deficit) for the three months ended March 31, 2019 and 2018, and its condensed statements of cash flows for the three months ended March 31, 2019 and 2018. Segments The Company operates in one segment. Management uses one measurement of profitability and does not segregate its business for internal reporting. All long‑lived assets are maintained in the United States of America. Use of Estimates Preparation of financial statements in conformity with U.S. Generally Accepted Accounting Principles, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of expenses during the reporting periods covered by the financial statements and accompanying notes. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, stock‑based compensation expense, the resolution of uncertain tax positions and valuation allowance and accruals for research and development costs. Management bases its estimates on historical experience or various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ materially from those estimates. Significant Accounting Policies The Company’s significant accounting policies are described in Note 2 to our consolidated financial statements for the year ended December 31, 2018, included in our Annual Report on Form 10-K. There have been no material changes to the Company’s significant accounting policies during the three months ended March 31, 2019, except as noted below with respect to the Company’s adoption of ASC 842. Research and Development Expenses Research and development costs are expensed as incurred. Substantially all of the Company’s research and development expenses consist of expenses incurred in connection with the development of serlopitant. These expenses include certain payroll and personnel expenses including stock‑based compensation expense, consulting costs, contract manufacturing costs and fees paid to clinical research organizations, or CROs, to conduct research and development. Non-refundable advance payments for goods or services that will be used or rendered for future research and development activities are deferred and capitalized and recognized as an expense as the goods are delivered or the related services are performed. The Company estimates non‑clinical study, contract manufacturing, and clinical trial expenses based on the services performed pursuant to contracts with research institutions and clinical research organizations that conduct and manage non‑clinical studies and clinical trials on its behalf. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Payments made to third parties under these arrangements in advance of the receipt of the related services are recorded as prepaid expenses until the services are rendered. Leases On January 1, 2019, the Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 842, Leases (“ASC 842), using the modified retrospective method for all lease arrangements at the beginning of the period of adoption. Results for reporting periods beginning January 1, 2019 are presented under ASC 842, while prior period amounts were not adjusted and continue to be presented in accordance with the Company’s historical accounting under ASC Topic 840, Leases. ASC 842 had an impact on the Company’s Condensed Balance Sheet but did not have a significant impact on the Company’s net loss. Under ASC 842, the Company determines if an arrangement is a lease at inception. in determining the present value of lease payments Stock-Based Compensation The Company measures and recognizes compensation expense for all stock‑based awards made to employees, directors and non‑employees, based on estimated fair values recognized using the straight‑line method over the requisite service period. The fair value of options to purchase common stock granted to employees, directors and non-employees is estimated on the grant date using the Black‑Scholes option valuation model. The calculation of stock‑based compensation expense requires that the Company make certain assumptions and judgments about a number of complex and subjective variables used in the Black‑Scholes model, including the expected term, expected volatility of the underlying common stock, and risk‑free interest rate. Revenue Recognition The Company records revenue based on a five-step model in accordance with ASC 606, Revenue from Contracts with Customers ("ASC 606"). For the Company’s collaboration agreement, which is discussed further under Note 5, the Company identifies the performance obligations, determines the transaction price, allocates the contract transaction price to the performance obligations, and recognizes the revenue when (or as) the performance obligation is satisfied. The Company identifies the performance obligations included within the agreement and evaluates which performance obligations are distinct. Upfront payments for licenses are evaluated to determine if the license is capable of being distinct from the obligations of the Company to participate on certain development and/or commercialization committees with the collaboration partners and supply manufactured drug product for clinical trials. For performance obligations that the Company satisfies over time, the Company utilizes the input method and revenue is recognized by consistently applying a method of measuring progress toward complete satisfaction of that performance obligation. The Company periodically reviews its estimated periods of performance based on the progress under each arrangement and accounts for the impact of any changes in estimated periods of performance on a prospective basis. Milestone payments are a form of variable consideration as the payments are contingent upon achievement of a substantive event. Milestone payments are estimated and included in the transaction price when the Company determines that it is probable that there will not be a significant reversal of cumulative revenue recognized in future periods. The transaction price is then allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such milestones and any related constraint, and if necessary, adjusts the estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect license, collaboration or other revenues and earnings in the period of adjustment. Research and development revenues and cost reimbursements are based upon negotiated rates for the Company’s full-time employee equivalents (“FTE”) and actual out-of-pocket costs. FTE rates are set based upon the Company’s costs, and which the Company believes approximate fair value. None of the revenues recognized to date are refundable if the relevant research effort is not successful. In accordance with ASC 606, the Company is required to adjust the transaction price for the effects of the time value of money if the timing of payments agreed to by the parties to the contract, explicitly or implicitly, provides the Company or its customer with a significant benefit of financing the transfer of goods or services. The Company concluded that its collaboration agreement did not contain a significant financing component because the payment structure of its agreements arise from reasons other than providing a significant benefit of financing. Net Loss per Share of Common Stock Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted‑average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted‑average number of common shares and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, convertible preferred stock and common stock options are considered to be potentially dilutive securities. Because the Company has reported a net loss for the three months ended March 31, 2019 and 2018, diluted net loss per common share is the same as basic net loss per common share for those periods. The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share data): Three Months Ended March 31, 2019 2018 (unaudited) Numerator: Net loss attributable to common stockholders, basic and diluted $ (18,873 ) $ (12,657 ) Denominator: Weighted-average common shares outstanding 23,332,570 17,709,274 Less: weighted-average common shares subject to repurchase (46,288 ) (125,897 ) Weighted-average common shares used to compute basic and diluted net loss per share 23,286,282 17,583,377 Net loss per share attributable to common stockholders Basic and diluted $ (0.81 ) $ (0.72 ) The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive: March 31, 2019 2018 (unaudited) Stock options available for issuance 2,275,293 3,731,172 Stock options outstanding 3,822,526 2,505,754 Outstanding common stock subject to repurchase 39,675 119,026 Shares issuable related to ESPP 43,618 — Total 6,181,112 6,355,952 Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016‑02, Leases Targeted Improvements to ASC 842 In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses — Measurement of Credit Losses on Financial Instruments The Company does not expect the adoption of this final rule to have a material impact on the financial statements. In June 2018, the FASB issued ASU 2018-07 Improvements to Nonemployee Share-Based Payment Accounting (Topic 718) In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) |
Cash Equivalents and Investment
Cash Equivalents and Investments | 3 Months Ended |
Mar. 31, 2019 | |
Investments Debt And Equity Securities [Abstract] | |
Cash Equivalents and Investments | 3. Cash Equivalents and Investments At March 31, 2019 and December 31, 2018, the balance in the Company’s accumulated other comprehensive loss was comprised solely of activity related to the Company’s available‑for‑sale securities. There were no material realized gains or losses recognized on the sale or maturity of available‑for‑sale securities during the three months ended March 31, 2019 and 2018 and as a result, the Company did not reclassify any amounts out of accumulated other comprehensive loss for the same periods. The following table summarizes the cash and available‑for‑sale securities (in thousands): Amortized Cost Unrealized Gains Unrealized Losses Fair Value March 31, 2019 (unaudited) Cash and money market funds $ 17,860 $ — $ — $ 17,860 Corporate notes 29,757 10 (11 ) 29,756 Commercial paper 65,193 3 (7 ) 65,189 Asset backed securities 6,244 — (6 ) 6,238 Government notes 2,472 2 (1 ) 2,473 Total $ 121,526 $ 15 $ (25 ) $ 121,516 Reported as: Cash and cash equivalents 61,958 Short-term investments 59,558 Total $ 121,516 Amortized Cost Unrealized Gains Unrealized Losses Fair Value December 31, 2018: Cash and money market funds $ 7,490 $ — $ — $ 7,490 Corporate notes 41,103 2 (70 ) 41,035 Commercial paper 63,036 — — 63,036 Asset backed securities 12,236 — (23 ) 12,213 Government notes 12,481 — (5 ) 12,476 Total $ 136,346 $ 2 $ (98 ) $ 136,250 Reported as: Cash and cash equivalents 49,510 Short-term investments 86,740 Total $ 136,250 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 4. Fair Value Measurements The fair value of the Company’s financial instruments reflects the amounts that the Company estimates it would receive in connection with the sale of an asset or pay in connection with the transfer of a liability in an orderly transaction between market participants at the measurement date (exit price). The Company discloses and recognizes the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). The guidance establishes three levels of the fair value hierarchy as follows: Level 1 – Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date; Level 2 – Inputs other than quoted prices that are observable for the assets or liability either directly or indirectly, including inputs in markets that are not considered to be active; Level 3 – Inputs that are unobservable. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. During the periods presented, the Company has not changed the manner in which it values assets and liabilities that are measured at fair value using Level 3 inputs. The Company recognizes transfers between levels of the fair value hierarchy as of the end of the reporting period. There were no transfers within the hierarchy during the periods presented. A summary of the assets and liabilities carried at fair value in accordance with the hierarchy defined above is as follows (in thousands): Fair Value Measurements Using Level 1 Level 2 Level 3 Total March 31, 2019 (unaudited) Assets: Money market funds $ 14,116 $ — $ — $ 14,116 Corporate notes — 29,756 — 29,756 Commercial paper — 65,189 — 65,189 Asset backed securities — 6,238 — 6,238 Government notes — 2,473 — 2,473 Total assets $ 14,116 $ 103,656 — $ 117,772 Fair Value Measurements Using Level 1 Level 2 Level 3 Total December 31, 2018: Assets: Money market funds $ 5,802 $ — $ — $ 5,802 Corporate notes — 41,035 — 41,035 Commercial paper — 63,036 — 63,036 Asset backed securities — 12,213 — 12,213 Government notes — 12,476 — 12,476 Total assets $ 5,802 $ 128,760 $ — $ 134,562 The Company uses a market approach for determining the fair value of all its Level 1 and Level 2 money market funds and marketable securities. To value its money market funds, the Company values the funds at $1 stable net asset value, which is the market pricing convention for identical assets that the Company has the ability to access. |
License Agreements
License Agreements | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
License Agreements | 5. License Agreements Merck License In December 2012, the Company entered into an exclusive worldwide royalty free license agreement with Merck Sharp & Dohme Corp. (“Merck”) for exclusive worldwide rights for the development and commercialization of serlopitant and two other NK 1 In May 2018, the Company paid a $3.0 million milestone payment associated with the initiation of the Company’s Phase 3 clinical program for pruritus associated with prurigo nodularis. Future milestone payments are considered a form of variable consideration and accrued for when the Company determines that it is probable that there will not be a significant reversal of the accrual in future periods. JT Torii Collaboration Agreement In August 2016, the Company entered into a license and collaboration agreement (the “Collaboration Agreement”) with Japan Tobacco Inc. and Torii Pharmaceutical Co. Ltd. (together referred to as “JT Torii”). Under the Collaboration Agreement, the Company granted to JT Torii the rights to develop and commercialize products containing serlopitant in Japan, for the treatment of diseases and conditions other than nausea or vomiting. In exchange, JT Torii paid the Company an upfront, non‑refundable payment of $11.0 million. In addition, the Company was entitled to receive aggregate payments of up to $28.0 million upon the achievement of specified development and regulatory milestones, and $15.0 million upon the achievement of a commercial milestone, as well as tiered royalties from the mid-single digits up to the mid‑teens on sales of licensed products in Japan. The Company’s performance obligations under the license agreement included the transfer of intellectual property rights in the form of licenses, obligations to participate on certain development and/or commercialization committees with the collaboration partners and supply manufactured drug product for clinical trials. In the second quarter of 2018, JT Torii informed the Company that they decided to halt the Japanese Phase 2 clinical trial of serlopitant, following which the Company and JT Torii agreed to terminate the Collaboration Agreement. As a result, the Company has reacquired full ownership of the development and commercialization rights to serlopitant in Japan and Under the Collaboration Agreement, the Company was reimbursed by JT Torii for the non-commercial supplies of serlopitant at the same rate it was charged by the third-party manufacturer for such supplies, which price did not include a significant or incremental discount for JT Torii. The assessment of performance obligations required judgment in order to determine the allocation of revenue to each deliverable and the appropriate period of time over which the revenue should be recognized. Under the Collaboration Agreement, the Company determined that the license was not distinct from the research and development services because JT Torii could not use the license with its available resources to obtain any economic value without the Company’s participation. The license and the services were combined as one unit of accounting and upfront payments were recorded initially as deferred revenue in the balance sheet. Revenue was then recognized over an estimated performance period as performance of services was being completed. The Company recognized the upfront fee based on performance of the obligation using input method over the period of performance, which represented the estimated development period in the territories based on the initial development plan managed by the joint steering committee. The original term of the agreement was through the expiration of the patents associated with serlopitant. Under the Collaboration Agreement, two of the milestones, which amount to $2.0 million each, related to the preparation of an IND for submission to regulatory authorities in the territory were considered substantive given that they are triggered by the Company’s performance relative to the achievement of pre-specified, “at risk” milestone events, including the submission of all completed trials clinical data packages and the validation of the manufacturing process. On September 1, 2017, the Company entered into a new services agreement with JT Torii to provide research and development services, including regulatory, chemistry and manufacturing support and related materials that is distinct from the original Collaboration Agreement. The Company evaluated the new services agreement and determined that the research and materials delivered to JT Torii represented another contract that provides distinct goods and services to JT Torii. The fees received under the services agreement were recognized as and when such services were performed by the Company and JT Torii consumed the benefits of those services. During the three months ended March 31, 2019 and 2018, the Company recognized revenue of zero and $0.5 million, respectively, in the condensed statements of operations and comprehensive loss related to the services and collaboration agreement. The services agreement terminated upon the termination of the Collaboration Agreement. |
Balance Sheets Components
Balance Sheets Components | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Balance Sheets Components | 6. Balance Sheets Components Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): March 31, 2019 December 31, 2018 (unaudited) Accrued personnel expenses $ 706 $ 2,649 Accrued clinical and development expenses 5,031 3,349 Other 424 256 Total $ 6,161 $ 6,254 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Legal Matters The Company’s industry is characterized by frequent claims and litigation, including claims regarding intellectual property. As a result, the Company may be subject to various legal proceedings from time to time. The results of any future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. On November 8, 2018, a putative securities class action complaint captioned Pavel Savelstrov v. Menlo Therapeutics, Inc., et al., Case No.18-CIV-06049, was filed in state court in the Superior Court of the State of California, County of San Mateo, against the Company, certain of its current executive officers and its directors, and certain underwriters in the Company’s initial public offering. On January 28, 2019, a putative securities class action complaint captioned Hugh McKay v. Menlo Therapeutics, Inc., et al. The complaints allege violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 due to allegedly false and misleading statements in connection with the Company’s initial public offering. The Company believes that the lawsuits are without merit and intends to vigorously defend itself. Accordingly, the Company cannot reasonably estimate any range of potential future charges, and the Company has not recorded any accrual for a contingent liability associated with these legal proceedings. Leases In September 2017, the Company entered into a lease agreement for its current location. The thirty-month lease, began on October 1, 2017 and provides approximately 14,000 square feet of office space in Redwood City, California. Base annual rent at lease inception was approximately $55,000 per month with annual increases. The Company recognizes rent expense on a straight‑line basis over the respective lease period. Lease expense was $0.2 million for the three months ended March 31, 2019 and 2018, respectively. 2019 $ 528 2020 179 Present value adjustment (23 ) Present value of lease payments $ 684 On April 12, 2019, the Company entered into an amendment to its lease agreement for its current location, which was effective on April 23, 2019 the date landlord consent was received. The lease was extended for an additional nine months, from March 31, 2020 to December 31, 2020. The base rent during the extended term will be approximately $60,000 per month. Indemnification As permitted under Delaware law and in accordance with the Company’s bylaws, the Company is required to indemnify its officers and directors for certain events or occurrences while the officer or director is or was serving in such capacity. The Company is also party to indemnification agreements with its directors. The Company believes the fair value of the indemnification rights and agreements is minimal. Accordingly, the Company has not recorded any liabilities for these indemnification rights and agreements as of March 31, 2019 and December 31, 2018. Contingencies From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of its business activities. The Company accrues a liability for such matters when it is probable that future expenditures will be made, and such expenditures can be reasonably estimated. Management is not currently aware of any matters that could have a material adverse effect on the financial position, results of operations, or cash flows of the Company. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stockholders' Equity | Equity Incentive Plans Under the Company’s 2011 Stock Incentive Plan (the “2011 Plan”), the Company may grant options to purchase common stock, restricted stock awards, or directly issue shares of common stock to employees, directors and consultants of the Company. Under the 2011 Plan, options granted are exercisable over a maximum term of 10 years from the date of grant and generally vest over a period of four years. Following the closing of the Company’s initial public offering in January 2018, the Company will make no further awards under the 2011 Plan. The Company adopted a 2018 Omnibus Incentive Plan (the “2018 Plan”), effective January 2018. The 2018 Plan provides for the grant of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights and other stock and cash-based awards (including annual cash incentives and long-term cash incentives). Pursuant to the terms of the 2018 Plan in January 2019, the 2018 Plan share reserve automatically increased by 929,327 shares of common stock issuable. The Company adopted a 2018 Employee Stock Purchase Plan (“ESPP”) in January 2018. The ESPP enables eligible employees of the Company and designated affiliates to purchase shares of common stock at a discount of 15%. Six-month offer periods under the ESPP commenced on September 1, 2018. Pursuant to the terms of the ESPP in January 2019, the ESPP share reserve automatically increased by 232,332 shares of common stock. Total stock-based compensation expense for employees and non-employees recognized in the statements of operations was as follows (in thousands): Three Months Ended March 31, 2019 2018 (unaudited) Research and development $ 512 $ 426 General and administrative 507 396 Total stock-based compensation expense $ 1,019 $ 822 The table below summarizes stock option and restricted award activity under the 2011 Plan and 2018 Plan: Number of Shares Outstanding Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in thousands) Balances at December 31, 2018 3,905,470 $ 5.35 8.65 $ 2,509 Forfeited/expired (108,881 ) 9.13 Exercised (34,418 ) 2.41 130 Granted 60,355 6.99 Balances at March 31, 2019 3,822,526 $ 5.26 8.38 $ 11,103 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | 9. Subsequent At-The-Market Offering In April 2019, the Company issued 244,316 shares of its common stock under the at-the-market offering program resulting in net proceeds to the Company of approximately $1.8 million. Amendment to Sublease On April 12, 2019, the Company entered into an amendment to its lease agreement for its current location, which was effective on April 23, 2019, the date landlord consent was received. The lease was extended for an additional nine months, from March 31, 2020 to December 31, 2020. The base rent during the extended term will be approximately $60,000 per month. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying financial information for the three months ended March 31, 2019 and 2018 is unaudited. These unaudited interim condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In management’s opinion, the unaudited interim condensed financial statements have been prepared on the same basis as the audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, and include all adjustments, which include only normal and recurring adjustments necessary for the fair presentation of the Company’s condensed balance sheet as of March 31, 2019, its condensed statements of operations and comprehensive loss for the three months ended March 31, 2019 and 2018, its condensed statements of convertible preferred stock and stockholders’ equity (deficit) for the three months ended March 31, 2019 and 2018, and its condensed statements of cash flows for the three months ended March 31, 2019 and 2018. |
Segments | Segments The Company operates in one segment. Management uses one measurement of profitability and does not segregate its business for internal reporting. All long‑lived assets are maintained in the United States of America. |
Use of Estimates | Use of Estimates Preparation of financial statements in conformity with U.S. Generally Accepted Accounting Principles, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of expenses during the reporting periods covered by the financial statements and accompanying notes. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, stock‑based compensation expense, the resolution of uncertain tax positions and valuation allowance and accruals for research and development costs. Management bases its estimates on historical experience or various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ materially from those estimates. |
Significant Accounting Policies | Significant Accounting Policies The Company’s significant accounting policies are described in Note 2 to our consolidated financial statements for the year ended December 31, 2018, included in our Annual Report on Form 10-K. There have been no material changes to the Company’s significant accounting policies during the three months ended March 31, 2019, except as noted below with respect to the Company’s adoption of ASC 842. |
Research and Development Expenses | Research and Development Expenses Research and development costs are expensed as incurred. Substantially all of the Company’s research and development expenses consist of expenses incurred in connection with the development of serlopitant. These expenses include certain payroll and personnel expenses including stock‑based compensation expense, consulting costs, contract manufacturing costs and fees paid to clinical research organizations, or CROs, to conduct research and development. Non-refundable advance payments for goods or services that will be used or rendered for future research and development activities are deferred and capitalized and recognized as an expense as the goods are delivered or the related services are performed. The Company estimates non‑clinical study, contract manufacturing, and clinical trial expenses based on the services performed pursuant to contracts with research institutions and clinical research organizations that conduct and manage non‑clinical studies and clinical trials on its behalf. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Payments made to third parties under these arrangements in advance of the receipt of the related services are recorded as prepaid expenses until the services are rendered. |
Leases | Leases On January 1, 2019, the Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 842, Leases (“ASC 842), using the modified retrospective method for all lease arrangements at the beginning of the period of adoption. Results for reporting periods beginning January 1, 2019 are presented under ASC 842, while prior period amounts were not adjusted and continue to be presented in accordance with the Company’s historical accounting under ASC Topic 840, Leases. ASC 842 had an impact on the Company’s Condensed Balance Sheet but did not have a significant impact on the Company’s net loss. Under ASC 842, the Company determines if an arrangement is a lease at inception. in determining the present value of lease payments |
Stock-Based Compensation | Stock-Based Compensation The Company measures and recognizes compensation expense for all stock‑based awards made to employees, directors and non‑employees, based on estimated fair values recognized using the straight‑line method over the requisite service period. The fair value of options to purchase common stock granted to employees, directors and non-employees is estimated on the grant date using the Black‑Scholes option valuation model. The calculation of stock‑based compensation expense requires that the Company make certain assumptions and judgments about a number of complex and subjective variables used in the Black‑Scholes model, including the expected term, expected volatility of the underlying common stock, and risk‑free interest rate. |
Revenue Recognition | Revenue Recognition The Company records revenue based on a five-step model in accordance with ASC 606, Revenue from Contracts with Customers ("ASC 606"). For the Company’s collaboration agreement, which is discussed further under Note 5, the Company identifies the performance obligations, determines the transaction price, allocates the contract transaction price to the performance obligations, and recognizes the revenue when (or as) the performance obligation is satisfied. The Company identifies the performance obligations included within the agreement and evaluates which performance obligations are distinct. Upfront payments for licenses are evaluated to determine if the license is capable of being distinct from the obligations of the Company to participate on certain development and/or commercialization committees with the collaboration partners and supply manufactured drug product for clinical trials. For performance obligations that the Company satisfies over time, the Company utilizes the input method and revenue is recognized by consistently applying a method of measuring progress toward complete satisfaction of that performance obligation. The Company periodically reviews its estimated periods of performance based on the progress under each arrangement and accounts for the impact of any changes in estimated periods of performance on a prospective basis. Milestone payments are a form of variable consideration as the payments are contingent upon achievement of a substantive event. Milestone payments are estimated and included in the transaction price when the Company determines that it is probable that there will not be a significant reversal of cumulative revenue recognized in future periods. The transaction price is then allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such milestones and any related constraint, and if necessary, adjusts the estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect license, collaboration or other revenues and earnings in the period of adjustment. Research and development revenues and cost reimbursements are based upon negotiated rates for the Company’s full-time employee equivalents (“FTE”) and actual out-of-pocket costs. FTE rates are set based upon the Company’s costs, and which the Company believes approximate fair value. None of the revenues recognized to date are refundable if the relevant research effort is not successful. In accordance with ASC 606, the Company is required to adjust the transaction price for the effects of the time value of money if the timing of payments agreed to by the parties to the contract, explicitly or implicitly, provides the Company or its customer with a significant benefit of financing the transfer of goods or services. The Company concluded that its collaboration agreement did not contain a significant financing component because the payment structure of its agreements arise from reasons other than providing a significant benefit of financing. |
Net Loss per Share of Common Stock | Net Loss per Share of Common Stock Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted‑average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted‑average number of common shares and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, convertible preferred stock and common stock options are considered to be potentially dilutive securities. Because the Company has reported a net loss for the three months ended March 31, 2019 and 2018, diluted net loss per common share is the same as basic net loss per common share for those periods. The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share data): Three Months Ended March 31, 2019 2018 (unaudited) Numerator: Net loss attributable to common stockholders, basic and diluted $ (18,873 ) $ (12,657 ) Denominator: Weighted-average common shares outstanding 23,332,570 17,709,274 Less: weighted-average common shares subject to repurchase (46,288 ) (125,897 ) Weighted-average common shares used to compute basic and diluted net loss per share 23,286,282 17,583,377 Net loss per share attributable to common stockholders Basic and diluted $ (0.81 ) $ (0.72 ) The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive: March 31, 2019 2018 (unaudited) Stock options available for issuance 2,275,293 3,731,172 Stock options outstanding 3,822,526 2,505,754 Outstanding common stock subject to repurchase 39,675 119,026 Shares issuable related to ESPP 43,618 — Total 6,181,112 6,355,952 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016‑02, Leases Targeted Improvements to ASC 842 In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses — Measurement of Credit Losses on Financial Instruments The Company does not expect the adoption of this final rule to have a material impact on the financial statements. In June 2018, the FASB issued ASU 2018-07 Improvements to Nonemployee Share-Based Payment Accounting (Topic 718) In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share data): Three Months Ended March 31, 2019 2018 (unaudited) Numerator: Net loss attributable to common stockholders, basic and diluted $ (18,873 ) $ (12,657 ) Denominator: Weighted-average common shares outstanding 23,332,570 17,709,274 Less: weighted-average common shares subject to repurchase (46,288 ) (125,897 ) Weighted-average common shares used to compute basic and diluted net loss per share 23,286,282 17,583,377 Net loss per share attributable to common stockholders Basic and diluted $ (0.81 ) $ (0.72 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive: March 31, 2019 2018 (unaudited) Stock options available for issuance 2,275,293 3,731,172 Stock options outstanding 3,822,526 2,505,754 Outstanding common stock subject to repurchase 39,675 119,026 Shares issuable related to ESPP 43,618 — Total 6,181,112 6,355,952 |
Cash Equivalents and Investme_2
Cash Equivalents and Investments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Investments Debt And Equity Securities [Abstract] | |
Summary of Cash and Available-for-sale Securities | The following table summarizes the cash and available‑for‑sale securities (in thousands): Amortized Cost Unrealized Gains Unrealized Losses Fair Value March 31, 2019 (unaudited) Cash and money market funds $ 17,860 $ — $ — $ 17,860 Corporate notes 29,757 10 (11 ) 29,756 Commercial paper 65,193 3 (7 ) 65,189 Asset backed securities 6,244 — (6 ) 6,238 Government notes 2,472 2 (1 ) 2,473 Total $ 121,526 $ 15 $ (25 ) $ 121,516 Reported as: Cash and cash equivalents 61,958 Short-term investments 59,558 Total $ 121,516 Amortized Cost Unrealized Gains Unrealized Losses Fair Value December 31, 2018: Cash and money market funds $ 7,490 $ — $ — $ 7,490 Corporate notes 41,103 2 (70 ) 41,035 Commercial paper 63,036 — — 63,036 Asset backed securities 12,236 — (23 ) 12,213 Government notes 12,481 — (5 ) 12,476 Total $ 136,346 $ 2 $ (98 ) $ 136,250 Reported as: Cash and cash equivalents 49,510 Short-term investments 86,740 Total $ 136,250 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets and Liabilities Carried at Fair Value | A summary of the assets and liabilities carried at fair value in accordance with the hierarchy defined above is as follows (in thousands): Fair Value Measurements Using Level 1 Level 2 Level 3 Total March 31, 2019 (unaudited) Assets: Money market funds $ 14,116 $ — $ — $ 14,116 Corporate notes — 29,756 — 29,756 Commercial paper — 65,189 — 65,189 Asset backed securities — 6,238 — 6,238 Government notes — 2,473 — 2,473 Total assets $ 14,116 $ 103,656 — $ 117,772 Fair Value Measurements Using Level 1 Level 2 Level 3 Total December 31, 2018: Assets: Money market funds $ 5,802 $ — $ — $ 5,802 Corporate notes — 41,035 — 41,035 Commercial paper — 63,036 — 63,036 Asset backed securities — 12,213 — 12,213 Government notes — 12,476 — 12,476 Total assets $ 5,802 $ 128,760 $ — $ 134,562 |
Balance Sheets Components (Tabl
Balance Sheets Components (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consisted of the following (in thousands): March 31, 2019 December 31, 2018 (unaudited) Accrued personnel expenses $ 706 $ 2,649 Accrued clinical and development expenses 5,031 3,349 Other 424 256 Total $ 6,161 $ 6,254 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Maturities of Lease Liability | As of March 31, 2019, maturities of lease liability due under the Company’s lease are as follows (in thousands): 2019 $ 528 2020 179 Present value adjustment (23 ) Present value of lease payments $ 684 On April 12, 2019, the Company entered into an amendment to its lease agreement for its current location, which was effective on April 23, 2019 the date landlord consent was received. The lease was extended for an additional nine months, from March 31, 2020 to December 31, 2020. The base rent during the extended term will be approximately $60,000 per month. |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Schedule of Share-based Compensation, Allocation of Recognized Period Costs | Total stock-based compensation expense for employees and non-employees recognized in the statements of operations was as follows (in thousands): Three Months Ended March 31, 2019 2018 (unaudited) Research and development $ 512 $ 426 General and administrative 507 396 Total stock-based compensation expense $ 1,019 $ 822 |
Schedule of Stock Option and Restricted Stock Activity | The table below summarizes stock option and restricted award activity under the 2011 Plan and 2018 Plan: Number of Shares Outstanding Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in thousands) Balances at December 31, 2018 3,905,470 $ 5.35 8.65 $ 2,509 Forfeited/expired (108,881 ) 9.13 Exercised (34,418 ) 2.41 130 Granted 60,355 6.99 Balances at March 31, 2019 3,822,526 $ 5.26 8.38 $ 11,103 |
Formation and Business of the_2
Formation and Business of the Company (Details) - USD ($) | Feb. 01, 2019 | Apr. 30, 2019 | Mar. 31, 2019 | Jan. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Apr. 30, 2019 | Dec. 31, 2018 |
Schedule Of Capitalization Equity [Line Items] | ||||||||
Maximum aggregate offering price of securities | $ 150,000,000 | |||||||
Net loss | $ (18,873,000) | $ (12,657,000) | ||||||
Net cash used in operating activities | (18,064,000) | $ (11,202,000) | ||||||
Cash, cash equivalents and investments | $ 121,500,000 | 121,500,000 | ||||||
Accumulated deficit | $ (129,509,000) | $ (129,509,000) | $ (110,636,000) | |||||
Convertible Stock Converted into Shares of Common Stock | ||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||
Common shares issued upon conversion of convertible stock (shares) | 9,629,405 | |||||||
Cantor Fitzgerald & Co | ||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||
Service fee as percentage of gross proceeds on sale of shares | 3.00% | |||||||
IPO | ||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||
Shares issued (shares) | 8,050,000 | |||||||
Proceeds from issuance initial public offering, net | $ 125,400,000 | |||||||
Underwriter’s Option | ||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||
Shares issued (shares) | 1,050,000 | |||||||
Common Stock | ||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||
Shares issued (shares) | 358,614 | |||||||
Average price per share | $ 8.08 | $ 8.08 | ||||||
Gross proceeds from sale of securities | $ 3,000,000 | |||||||
Net proceeds from sale of securities | $ 2,900,000 | |||||||
Common Stock | Subsequent Event | ||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||
Shares issued (shares) | 244,316 | |||||||
Average price per share | $ 7.83 | $ 7.83 | ||||||
Gross proceeds from sale of securities | $ 1,900,000 | |||||||
Net proceeds from sale of securities | $ 1,800,000 | $ 4,700,000 | ||||||
Common Stock | At-The-Market Offering Under Sales Agreement | Cantor Fitzgerald & Co | ||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||
Maximum aggregate offering price of securities | $ 50,000,000 |
Significant Accounting Polici_4
Significant Accounting Policies - Segments (Details) | 3 Months Ended |
Mar. 31, 2019Segment | |
Accounting Policies [Abstract] | |
Number of operating segments | 1 |
Significant Accounting Polici_5
Significant Accounting Policies - Revenue Recognition (Details) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Accounting Policies [Abstract] | |
Revenues recognized refundable | $ 0 |
Significant Accounting Polici_6
Significant Accounting Policies - Net Loss per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Accounting Policies [Abstract] | ||
Net loss attributable to common stockholders, basic | $ (18,873) | $ (12,657) |
Weighted-average common shares outstanding | 23,332,570 | 17,709,274 |
Less: weighted-average common shares subject to repurchase | (46,288) | (125,897) |
Weighted-average common shares used to compute basic and diluted net loss per share | 23,286,282 | 17,583,377 |
Net loss attributable to common stockholders per share, basic and diluted | $ (0.81) | $ (0.72) |
Significant Accounting Polici_7
Significant Accounting Policies - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from the calculation of EPS | 6,181,112 | 6,355,952 |
Stock options available for issuance | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from the calculation of EPS | 2,275,293 | 3,731,172 |
Stock options outstanding | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from the calculation of EPS | 3,822,526 | 2,505,754 |
Outstanding common stock subject to repurchase | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from the calculation of EPS | 39,675 | 119,026 |
Shares issuable related to ESPP | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from the calculation of EPS | 43,618 |
Significant Accounting Polici_8
Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||
Lease liabilities | $ 684 | |
Right-of-use assets | $ 670 | |
Accounting Standards Update (“ASU”) 2016 02 | ||
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||
Lease liabilities | $ 800 | |
Right-of-use assets | $ 800 |
Cash Equivalents and Investme_3
Cash Equivalents and Investments (Details) | 3 Months Ended | |
Mar. 31, 2019USD ($)investment | Mar. 31, 2018USD ($) | |
Investments Debt And Equity Securities [Abstract] | ||
Realized gains (losses) recognized on the sale or maturity of available-for-sale securities | $ | $ 0 | $ 0 |
Securities in continuous unrealized loss position for more than one year | investment | 0 |
Cash Equivalents and Investme_4
Cash Equivalents and Investments - Cash and Available for Sale securities (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities, amortized cost | $ 121,526 | $ 136,346 | ||
Available-for-sale securities, unrealized gains | 15 | 2 | ||
Available-for-sale securities, unrealized losses | (25) | (98) | ||
Available-for-sale securities, fair value | 121,516 | 136,250 | ||
Cash and cash equivalents | 61,958 | 49,510 | $ 78,527 | $ 10,206 |
Short-term investments | 59,558 | 86,740 | ||
Total | 121,516 | 136,250 | ||
Cash and money market funds | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities, amortized cost | 17,860 | 7,490 | ||
Available-for-sale securities, unrealized gains | 0 | 0 | ||
Available-for-sale securities, unrealized losses | 0 | 0 | ||
Available-for-sale securities, fair value | 17,860 | 7,490 | ||
Corporate notes | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities, amortized cost | 29,757 | 41,103 | ||
Available-for-sale securities, unrealized gains | 10 | 2 | ||
Available-for-sale securities, unrealized losses | (11) | (70) | ||
Available-for-sale securities, fair value | 29,756 | 41,035 | ||
Government notes | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities, amortized cost | 2,472 | 12,481 | ||
Available-for-sale securities, unrealized gains | 2 | 0 | ||
Available-for-sale securities, unrealized losses | (1) | (5) | ||
Available-for-sale securities, fair value | 2,473 | 12,476 | ||
Asset backed securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities, amortized cost | 6,244 | 12,236 | ||
Available-for-sale securities, unrealized gains | 0 | 0 | ||
Available-for-sale securities, unrealized losses | (6) | (23) | ||
Available-for-sale securities, fair value | 6,238 | 12,213 | ||
Commercial paper | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities, amortized cost | 65,193 | 63,036 | ||
Available-for-sale securities, unrealized gains | 3 | 0 | ||
Available-for-sale securities, unrealized losses | (7) | 0 | ||
Available-for-sale securities, fair value | $ 65,189 | $ 63,036 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets | $ 117,772 | $ 134,562 |
Corporate notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investments | 29,756 | 41,035 |
Asset backed securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investments | 6,238 | 12,213 |
Government notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investments | 2,473 | 12,476 |
Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets | 14,116 | 5,802 |
Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets | 103,656 | 128,760 |
Level 2 | Corporate notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investments | 29,756 | 41,035 |
Level 2 | Asset backed securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investments | 6,238 | 12,213 |
Level 2 | Government notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investments | 2,473 | 12,476 |
Money market funds | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds | $ 14,116 | 5,802 |
Net asset value | $ 1 | |
Money market funds | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds | $ 14,116 | 5,802 |
Commercial paper | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investments | 65,189 | 63,036 |
Commercial paper | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investments | $ 65,189 | $ 63,036 |
License Agreements (Details)
License Agreements (Details) $ in Millions | 1 Months Ended | 3 Months Ended | ||||
May 31, 2018USD ($) | Aug. 31, 2016USD ($)Milestone | Dec. 31, 2012USD ($) | Mar. 31, 2019USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Number of milestones | Milestone | 2 | |||||
Merck | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative agreement, milestone payments paid | $ 3 | |||||
Merck | License | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Licensing fee | $ 1 | |||||
Merck | Development and Regulatory Milestones | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative arrangements, potential milestone payments | $ 25 | |||||
JT Torii | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Accelerated recognition of deferred revenue, amount of revenue recognized | $ 8.1 | |||||
Research and development arrangement, contract to perform for others, compensation earned | $ 2 | |||||
JT Torii | Research and Development Arrangement | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Research and development arrangement, contract to perform for others, compensation earned | $ 0 | $ 0.5 | ||||
JT Torii | Development and Regulatory Milestones | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative arrangements, potential milestone proceeds | $ 28 | |||||
JT Torii | Collaboration Agreement | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative agreement, upfront payment received | 11 | |||||
JT Torii | Commercial Milestone | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative arrangements, potential milestone proceeds | 15 | |||||
JT Torii | Development and Regulatory Milestone, Preparation of Investigational New Drug Submission, Milestone One [Member] | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative arrangements, potential milestone proceeds | $ 2 |
Balance Sheets Components (Deta
Balance Sheets Components (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ||
Accrued personnel expenses | $ 706 | $ 2,649 |
Accrued clinical and development expenses | 5,031 | 3,349 |
Other | 424 | 256 |
Total | $ 6,161 | $ 6,254 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) | Apr. 12, 2019USD ($) | Oct. 01, 2017USD ($)ft² | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) |
Acquired Indefinite Lived Intangible Assets [Line Items] | ||||
Operating lease, discount rate, percent | 6.00% | |||
Operating lease, right-of-use asset, amortization | $ 177,000 | |||
Operating lease, Remaining lease term | 1 year | |||
Operating lease, rent expense | $ 200,000 | $ 200,000 | ||
Subsequent Event | ||||
Acquired Indefinite Lived Intangible Assets [Line Items] | ||||
Operating lease, monthly expense | $ 60,000 | |||
Operating lease amendment date | Apr. 12, 2019 | |||
Operating lease extended term | 9 months | |||
Operating lease, option to extend | true | |||
Operating lease option to extend, description | The lease was extended for an additional nine months, from March 31, 2020 to December 31, 2020 | |||
Redwood City, California | ||||
Acquired Indefinite Lived Intangible Assets [Line Items] | ||||
Operating lease, term of contract | 30 months | |||
Leased office space, square footage | ft² | 14,000 | |||
Operating lease, monthly expense | $ 55,000 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Maturities of Lease Liability (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Maturities of lease liability | |
2019 | $ 528 |
2020 | 179 |
Present value adjustment | (23) |
Present value of lease payments | $ 684 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 1,019 | $ 822 | ||
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 512 | 426 | ||
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 507 | $ 396 | ||
2011 Stock Incentive Plan | Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Option expiration period | 10 years | |||
Option vesting period | 4 years | |||
2018 Omnibus Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share reserve increased by number of shares | 929,327 | |||
Shares available for issuance under the Plan (shares) | 2,275,293 | |||
2018 Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share reserve increased by number of shares | 232,332 | |||
Purchase of common stock offer period under the plan | 6 months | |||
Discount rate from price of common stock on purchase date | 15.00% | |||
Commencement date to purchase common stock under the ESPP | Sep. 1, 2018 | |||
Shares available under the Plan (shares) | 511,313 |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option and Restricted Stock Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Balances, beginning (shares) | 3,905,470 | |
Forfeited/expired (shares) | (108,881) | |
Exercised (shares) | (34,418) | |
Granted (shares) | 60,355 | |
Balances, ending (shares) | 3,822,526 | 3,905,470 |
Outstanding, exercise price per share (in USD per share) | $ 5.35 | |
Forfeited/expired, exercise price per share (in USD per share) | 9.13 | |
Exercised, exercise price per share (in USD per share) | 2.41 | |
Granted, exercise price per share (in USD per share) | 6.99 | |
Outstanding, exercise price per share (in USD per share) | $ 5.26 | $ 5.35 |
Options outstanding, weighted average remaining contractual term | 8 years 4 months 17 days | 8 years 7 months 24 days |
Options outstanding, aggregate intrinsic value | $ 11,103 | $ 2,509 |
Exercised, aggregate intrinsic value | $ 130 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Apr. 12, 2019 | Apr. 30, 2019 | Mar. 31, 2019 | Apr. 30, 2019 |
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Operating lease amendment date | Apr. 12, 2019 | |||
Operating lease extended term | 9 months | |||
Operating lease, option to extend | true | |||
Operating lease option to extend, description | The lease was extended for an additional nine months, from March 31, 2020 to December 31, 2020 | |||
Operating lease, monthly expense | $ 60,000 | |||
Common Stock | ||||
Subsequent Event [Line Items] | ||||
Shares issued (shares) | 358,614 | |||
Net proceeds from sale of securities | $ 2,900,000 | |||
Common Stock | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Shares issued (shares) | 244,316 | |||
Net proceeds from sale of securities | $ 1,800,000 | $ 4,700,000 |