Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Oct. 31, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Cidara Therapeutics, Inc. | |
Entity Central Index Key | 1,610,618 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Emerging Growth Company | true | |
Entity Small Business | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 27,751,431 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 83,780 | $ 60,813 |
Short-term investments | 4,494 | 14,501 |
Accounts receivable | 0 | 321 |
Prepaid expenses and other current assets | 3,687 | 2,035 |
Total current assets | 91,961 | 77,670 |
Property and equipment, net | 786 | 1,044 |
Other assets | 62 | 321 |
Total assets | 92,809 | 79,035 |
Current liabilities: | ||
Accounts payable | 2,439 | 2,590 |
Accrued liabilities | 3,385 | 4,257 |
Accrued compensation and benefits | 2,585 | 2,571 |
Contingent forward purchase obligations | 4,486 | 0 |
Current portion of term loan | 667 | 2,667 |
Total current liabilities | 13,562 | 12,085 |
Term loan, less debt issuance costs | 9,253 | 7,206 |
Other long-term liabilities | 62 | 0 |
Total liabilities | 22,877 | 19,291 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock | ||
Common stock, $0.0001 par value; 200,000,000 shares authorized at September 30, 2018 and December 31, 2017; 27,751,431 and 27,751,413 shares issued and outstanding, respectively, at September 30, 2018; 20,534,993 and 20,525,688 shares issued and outstanding, respectively, at December 31, 2017 | 3 | 2 |
Additional paid-in capital | 276,323 | 209,140 |
Accumulated other comprehensive loss | (1) | (8) |
Accumulated deficit | (206,393) | (149,390) |
Total stockholders' equity | 69,932 | 59,744 |
Total liabilities and stockholders' equity | 92,809 | 79,035 |
Series X Convertible Preferred Stock | ||
Stockholders' equity: | ||
Preferred stock | $ 0 | $ 0 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 27,751,431 | 20,534,993 |
Common stock, shares outstanding | 27,751,413 | 20,525,688 |
Series X Convertible Preferred Stock | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 5,000,000 | 0 |
Preferred stock, shares issued | 445,231 | 0 |
Preferred stock, shares outstanding | 445,231 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Operating expenses: | ||||
Research and development | $ 11,278 | $ 9,159 | $ 36,096 | $ 32,593 |
General and administrative | 3,447 | 3,090 | 10,591 | 9,669 |
Total operating expenses | 14,725 | 12,249 | 46,687 | 42,262 |
Loss from operations | (14,725) | (12,249) | (46,687) | (42,262) |
Other income (expense): | ||||
Change in fair value of contingent forward purchase obligations | 888 | 0 | (224) | 0 |
Interest income (expense), net | 222 | (8) | 447 | (38) |
Other expense | (4) | 0 | (210) | 0 |
Total other income (expense) | 1,106 | (8) | 13 | (38) |
Net loss | (13,619) | (12,257) | (46,674) | (42,300) |
Recognition of beneficial conversion feature | 0 | 0 | (10,329) | 0 |
Net loss attributable to common shareholders | $ (13,619) | $ (12,257) | $ (57,003) | $ (42,300) |
Basic and diluted net loss per common share (in dollars per share) | $ (0.49) | $ (0.73) | $ (2.35) | $ (2.51) |
Shares used to compute basic and diluted net loss per common share (in shares) | 27,705,472 | 16,864,211 | 24,254,254 | 16,830,749 |
Net loss | $ (13,619) | $ (12,257) | $ (46,674) | $ (42,300) |
Unrealized gain (loss) on short-term investments | 2 | (1) | 7 | 0 |
Comprehensive loss | $ (13,617) | $ (12,258) | $ (46,667) | $ (42,300) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Operating activities: | ||
Net loss | $ (46,674) | $ (42,300) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 412 | 528 |
Stock-based compensation | 4,346 | 4,206 |
Amortization of debt issuance costs and debt discount | 47 | 58 |
Amortization of discount or premium on short-term investments | 36 | (45) |
Deferred rent | 11 | (19) |
Change in fair value of contingent forward purchase obligations | 224 | 0 |
Contingent forward purchase obligation offering costs | 210 | 0 |
Changes in assets and liabilities: | ||
Accounts receivable | 321 | (337) |
Prepaid expenses and other current assets | (1,652) | (952) |
Accounts payable and accrued liabilities | (967) | (1,185) |
Accrued compensation | 388 | (372) |
Other assets | 259 | 0 |
Net cash used in operating activities | (43,039) | (40,418) |
Investing activities: | ||
Purchases of short-term investments | (14,548) | (9,880) |
Maturities of short-term investments | 24,526 | 19,300 |
Purchases of property and equipment | (137) | (166) |
Net cash provided by investing activities | 9,841 | 9,254 |
Financing activities: | ||
Proceeds from May 2018 Registered Direct Offering, net of offering costs | 49,521 | 0 |
Proceeds from issuance of common stock under equity sales agreement, net of issuance costs | 6,440 | 0 |
Proceeds from exercise of stock options | 204 | 152 |
Repurchase of unvested restricted stock | 0 | (79) |
Net cash provided by financing activities | 56,165 | 73 |
Net increase (decrease) in cash and cash equivalents | 22,967 | (31,091) |
Cash and cash equivalents at beginning of period | 60,813 | 85,367 |
Cash and cash equivalents at end of period | 83,780 | 54,276 |
Supplemental disclosure of cash flows: | ||
Interest paid | 432 | 378 |
Non-cash investing activities: | ||
Property and equipment acquired but not yet paid | 17 | 16 |
Non-cash financing activities: | ||
Proceeds from issuance of common stock pursuant to Employee Stock Purchase Plan | 374 | 301 |
Vesting of early exercised stock options | $ 21 | $ 35 |
THE COMPANY AND BASIS OF PRESEN
THE COMPANY AND BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
THE COMPANY AND BASIS OF PRESENTATION | THE COMPANY AND BASIS OF PRESENTATION Description of Business Cidara Therapeutics, Inc., or the Company, was originally incorporated in Delaware in December 2012 as K2 Therapeutics, Inc., and its name was changed to Cidara Therapeutics, Inc. in July 2014. The Company is a biotechnology company focused on the discovery, development and commercialization of novel anti-infectives. The Company’s portfolio is comprised of a proprietary product candidate for the treatment and prevention of serious fungal infections. The Company is also conducting research in bacterial and viral infection. The Company formed wholly-owned subsidiaries, Cidara Therapeutics UK Limited, in England, and Cidara Therapeutics (Ireland) Limited, in Ireland, in March 2016 and October 2018, respectively, for the purpose of developing its product candidates in Europe. Basis of Presentation The Company has a limited operating history and the sales and income potential of the Company’s business and market are unproven. The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has experienced net losses and negative cash flows from operating activities since its inception. At September 30, 2018 , the Company had an accumulated deficit of $206.4 million . The Company expects to continue to incur net losses into the foreseeable future. Successful transition to attaining profitable operations is dependent upon achieving a level of revenues adequate to support the Company’s cost structure. The Company has prepared cash flow forecasts which indicate, based on its current cash resources available, that it will have sufficient resources to fund its business for at least the next 12 months from the date of this filing. The Company will need to raise additional capital to fund its losses from operations. It anticipates raising capital through debt and equity financing, through government funding or through collaborations or partnerships with other entities. Debt or equity financing, government funding or collaborations and partnerships with other entities may not be available on a timely basis on terms acceptable to the Company, or at all. If the Company is not able to secure adequate additional funding, the Company may be forced to delay, reduce or eliminate its research and development programs or future commercialization efforts, or to make reductions in spending, extend payment terms with suppliers, liquidate or grant rights to assets where possible, or suspend or curtail planned programs. Any of these actions could materially harm the Company’s business, results of operations and future prospects. Unaudited Interim Financial Data The accompanying condensed consolidated financial statements are unaudited and have been prepared by the Company in accordance with U.S. generally accepted accounting principles, or GAAP, as found in the Accounting Standards Codification, or ASC, of the Financial Accounting Standards Board, or FASB. Certain information and footnote disclosures normally included in the Company’s annual financial statements have been condensed or omitted. These interim condensed consolidated financial statements, in the opinion of management, reflect all normal recurring adjustments necessary for a fair presentation of the Company’s financial position and results of operations for the interim periods ended September 30, 2018 and 2017 . Basis of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of expenses during the reporting period. The Company evaluates its estimates and assumptions on an ongoing basis. The most significant estimates in the Company’s consolidated financial statements relate to estimating the fair value of the Company’s stock options, the fair value of the Company's contingent forward purchase obligations, and certain accruals, including those related to nonclinical and clinical activities. Although the estimates are based on the Company’s knowledge of current events, comparable companies, and actions it may undertake in the future, actual results may ultimately materially differ from these estimates and assumptions. Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, the Chief Executive Officer, in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business as one operating segment. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Cash and Cash Equivalents The Company considers all short-term investments purchased with a maturity of three months or less when acquired to be cash equivalents. Investments Available-for-Sale Available-for-sale securities are carried at fair value, with the unrealized gains and losses reported in accumulated other comprehensive loss. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. The amortization of premiums and accretion of discounts is included in interest income. Realized gains and losses and declines in value judged to be other-than-temporary, if any, on available-for-sale securities are included in other income. The cost of securities sold is based on the specific identification method. Interest and dividends on securities classified as available-for-sale are included in interest income. Securities with maturity dates of 12 months or less from the date of purchase are classified as short-term investments and securities with maturity dates of more than 12 months are classified as long-term investments. Concentration of Credit Risk The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents and short-term investments. Periodically, the Company maintains deposits in government insured financial institutions in excess of government insured limits. The Company invests its cash balances in financial institutions that it believes have high credit quality, has not experienced any losses on such accounts and does not believe it is exposed to significant credit risk. Patent Costs The Company expenses all costs as incurred in connection with patent applications (including direct application fees and the legal and consulting expenses related to making such applications), and such costs are included in general and administrative expenses in the accompanying statements of operations. Income Taxes The Company follows the FASB's ASC 740, Income Taxes, in reporting deferred income taxes. ASC 740 requires a company to recognize deferred tax assets and liabilities for expected future income tax consequences of events that have been recognized in the Company’s consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates in the years in which the temporary differences are expected to reverse. Valuation allowances are provided if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company accounts for uncertain tax positions pursuant to ASC 740, which prescribes a recognition threshold and measurement process for financial statement recognition of uncertain tax positions taken or expected to be taken in a tax return. If the tax position meets this threshold, the benefit to be recognized is measured as the tax benefit having the highest likelihood of being realized upon ultimate settlement with the taxing authority. The Company recognizes interest accrued related to unrecognized tax benefits and penalties in the provision for income taxes. On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the "Tax Act"), which among other provisions, reduced the U.S. corporate tax rate from 35% to 21%, effective January 1, 2018. Due to the timing of the enactment and the complexity involved in applying the provisions of the Tax Act, the Company made reasonable estimates of the effects and recorded provisional amounts in our financial statements as of December 31, 2017. As the Company collects and prepares necessary data, and continues to interpret the Tax Act and any additional guidance issued by the U.S. Treasury Department, the Internal Revenue Service (IRS) and other standard-setting bodies, the Company may make adjustments to the provisional amounts. Those adjustments may affect deferred tax balances. However, due to the valuation allowance position, the Company expects there will be no net impact to the financial statements. The Company did not make any such adjustments during the quarter ended September 30, 2018 . Any adjustments to account for the tax effects of the Tax Act would be made in a subsequent quarter. Revenue Recognition The Company recognizes revenues when customers obtain control of promised goods or services, in an amount that reflects the consideration which it expects to receive in exchange for those goods or services. The Company recognizes revenues following the five step model prescribed under Accounting Standards Update ("ASU") No. 2014-09 ("ASU 2014-09"): (i) identify 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 revenues when (or as) the Company satisfies the performance obligation. Grant Funding The Company has received research and development funding through a grant from CARB-X, a public-private partnership focused on antibacterials. The Company has also been awarded a partnership grant with Rutgers University from the U.S. National Institute of Allergy and Infectious Diseases ("NIAID") of the National Institutes of Health ("NIH"), an agency of the United States Department of Health and Human Services. The Company has evaluated the terms of the grants to assess its obligations and the classification of funding received. Amounts billable for funded research and development are recognized in the statement of operations as a reduction to research and development expense over the grant period as the related costs are incurred to meet the Company's obligations. Research and Development Costs Research and development expenses consist of wages, benefits and stock-based compensation charges for research and development employees, scientific consultant fees, facilities and overhead expenses, laboratory supplies, manufacturing expenses, and nonclinical and clinical trial costs. The Company accrues nonclinical and clinical trial expenses based on work performed, which relies on estimates of total costs incurred based on patient enrollment, completion of studies, and other events. Costs incurred in purchasing technology assets and intellectual property are charged to research and development expense if the technology has not been conclusively proven to be feasible and has no alternative future use. Comprehensive Loss Comprehensive loss is defined as the change in equity during a period from transactions and other events and/or circumstances from non-owner sources. The Company’s only component of other comprehensive loss is unrealized losses on short-term investments. Comprehensive losses have been reflected in the condensed consolidated statements of operations and comprehensive loss for all periods presented. Stock-based Compensation The Company accounts for stock-based compensation expense related to employee stock options and employee stock purchase plan rights by estimating the fair value on the date of grant using the Black-Scholes option pricing model. The fair value of Restricted Stock Units (RSUs) and Performance-based RSUs (PRSUs) granted to employees is estimated based on the closing price of the Company's common stock on the date of grant. For awards subject to time-based vesting conditions, stock-based compensation expense is recognized ratably over the requisite service period of the awards. For awards subject to performance-based vesting conditions, the Company assesses the probability of achievement of the individual milestones under the stock-based awards and recognizes stock-based compensation expense over the implicit service period commencing once the Company believes the performance criteria is probable of achievement. The Company accounts for stock options, RSUs, and PRSUs granted to non-employees using the fair value approach. These stock-based awards are subject to periodic revaluation over their vesting terms. Net Loss Per Share Basic net loss per share is calculated by dividing the net loss allocable to common shares by the weighted-average number of common shares outstanding for the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss allocable to common shares by the weighted-average number of common shares and dilutive common stock equivalents outstanding for the period determined using the treasury-stock and if-converted methods. Dilutive common stock equivalents are comprised of warrants, unvested restricted common stock subject to repurchase, and RSUs and options outstanding under the Company’s stock option plans. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding. The following table sets forth the outstanding potentially dilutive securities that have been excluded in the calculation of diluted net loss per share because to do so would be anti-dilutive (in common stock equivalent shares): September 30, 2018 2017 Common stock warrants 12,517,328 17,331 Series X Convertible Preferred stock 4,452,310 — Common stock options and RSUs issued and outstanding 4,083,233 3,323,599 Common stock subject to repurchase 18 13,269 Total 21,052,889 3,354,199 Fair Value of Financial Instruments The Company follows ASC 820-10 issued by the FASB with respect to fair value reporting for financial assets and liabilities. The guidance defines fair value, provides guidance for measuring fair value and requires certain disclosures. The guidance does not apply to measurements related to share-based payments. The guidance discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The Company’s financial instruments consist of cash and cash equivalents, marketable securities, contingent forward purchase obligations, and long-term debt. Fair value estimates of these instruments are made at a specific point in time based on relevant market information. These estimates may be subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. The carrying amount of cash and cash equivalents, prepaid expenses, accounts payable, and accrued liabilities are generally considered to be representative of their respective fair values because of the short-term nature of those instruments. The fair value of short-term investments is based upon market prices quoted on the last day of the fiscal period or other observable market inputs. The fair value of contingent forward purchase obligations is based on a probability-weighted valuation approach (See Note 4). The Company believes that the fair value of long-term debt approximates its carrying value. Recently Issued Accounting Standards During 2016, the FASB issued ASU 2016-02, “Leases,” which requires that operating lease arrangements longer than 12 months result in an entity recognizing an asset and liability. The updated guidance is effective for interim and annual periods beginning after December 15, 2018, and early adoption is permitted. The Company currently expects that its operating lease commitments will be subject to the new standard and recognized as right-of-use assets and operating lease liabilities upon the adoption of ASU 2016-02, which will increase the total assets and total liabilities that it reports relative to such amounts prior to adoption. During 2018, the FASB issued ASU 2018-07, "Improvements to Nonemployee Share-Based Payment Accounting," which expanded the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees. Under the ASU, the guidance on such payments to nonemployees is aligned with the accounting for share-based payments granted to employees, including the measurement of equity-classified awards, which is fixed at the grant date under the new guidance. The updated guidance is effective for interim and annual periods beginning after December 15, 2018, and early adoption is permitted. The Company is currently assessing the impact that this standard will have on its consolidated financial statements. During 2018, the FASB issued ASU 2018-13, "Changes to the Disclosure Requirements for Fair Value Measurement," which modifies certain disclosure requirements on fair value measurements. The updated guidance is effective for interim and annual periods beginning after December 15, 2019, and early adoption is permitted. The Company is currently assessing the impact that this standard will have on its consolidated financial statements. |
SHORT-TERM INVESTMENTS
SHORT-TERM INVESTMENTS | 9 Months Ended |
Sep. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
SHORT-TERM INVESTMENTS | SHORT-TERM INVESTMENTS The following table summarizes the available-for-sale securities held at September 30, 2018 and December 31, 2017 (in thousands): As of September 30, 2018 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Corporate debt $ 2,498 $ — $ (1 ) $ 2,497 U.S. Treasury Bill 1,997 — — 1,997 Total $ 4,495 $ — $ (1 ) $ 4,494 As of December 31, 2017 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Corporate debt $ 14,509 $ — $ (8 ) $ 14,501 Total $ 14,509 $ — $ (8 ) $ 14,501 All available-for-sale securities held at September 30, 2018 and December 31, 2017 had maturities of less than one year . Unrealized gains and losses on available-for-sale securities are included as a component of other comprehensive loss. The securities in unrealized loss positions have not been in a continuous unrealized loss position for 12 months or longer. The Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be at maturity. The Company reviews its investments to identify and evaluate investments that have an indication of possible other-than-temporary impairment. Factors considered in determining whether a loss is other-than-temporary include the length of time and extent to which fair value has been less than the cost basis, the financial condition and near-term prospects of the investee, and the Company’s intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value. During the nine months ended September 30, 2018 and 2017 , respectively, the Company did not recognize any impairment or gains or losses on sales of available-for-sale securities. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The Company follows ASC 820-10, Fair Value Measurements and Disclosures, which among other things, defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement determined based on assumptions that market participants would use in pricing an asset or liability. The carrying amounts of accounts payable and accrued liabilities are considered to be representative of their respective fair values because of the short-term nature of those instruments. Based on the borrowing rates available to the Company for loans with similar terms, which is considered a Level 2 input as described below, the Company believes that the fair value of long-term debt approximates its carrying value. As a basis for considering such assumptions, a three-tier fair value hierarchy has been established, which prioritizes the inputs used in measuring fair value as follows: Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and Level 3: Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions, which reflect those that a market participant would use. The Company classifies investments in money market funds and treasury bills within Level 1 as the prices are available from quoted prices in active markets. Investments in commercial paper, corporate debt and reverse repurchase agreements are classified within Level 2 as these instruments are valued using observable market inputs including reported trades, broker/dealer quotes, bids and/or offers. As discussed in Note 6, on May 21, 2018, the Company entered into a securities purchase agreement with certain investors providing for the purchase and sale of up to an aggregate of $120.0 million of its common stock and preferred stock in three closings. The second and optional third closings and warrants related to the optional third closing, which are triggered by the Company's announcement of topline data of Part B of its STRIVE Phase 2 clinical trial of rezafungin, contain features for subsequent closings that are not solely within the control of the Company and that embody an obligation that the Company must settle by issuing a variable number of shares when the obligation is based predominantly on having a fixed value at inception. In accordance with ASC 480, "Distinguishing Liabilities from Equity," the Company determined that these closings are classified as liabilities and represent contingent forward purchase obligations. These liabilities are required to be recorded at their estimated fair value initially and on a recurring basis. The contingent forward purchase obligations are classified within Level 3 of the fair value hierarchy as the Company is using a probability-weighted valuation approach, utilizing significant unobservable inputs including the probability and estimated timing of achieving positive or negative results associated with Part B of the STRIVE Phase 2 clinical trial and estimated discount rates related to the risk of achievement of the expected equity issuances. The liability was initially recorded at $4.3 million on May 21, 2018 and fair value adjustments resulting in a gain of $0.9 million and a loss of $0.2 million were recorded during the three and nine month periods ended September 30, 2018 , respectively. None of the Company’s non-financial assets or liabilities are recorded at fair value on a non-recurring basis. No transfers between levels have occurred during the periods presented. The following tables summarize the Company’s financial instruments measured at fair value on a recurring basis (in thousands): TOTAL LEVEL 1 LEVEL 2 LEVEL 3 September 30, 2018 Assets: Money market funds $ 83,064 $ 83,064 $ — $ — U.S. Treasury bill 1,997 1,997 — — Corporate debt 2,497 — 2,497 — Total assets at fair value $ 87,558 $ 85,061 $ 2,497 $ — Liabilities: Contingent forward purchase obligations $ 4,486 $ — $ — $ 4,486 Total liabilities at fair value $ 4,486 $ — $ — $ 4,486 December 31, 2017 Assets: Money market funds $ 11,556 $ 11,556 $ — $ — U.S. Treasury reverse repurchase agreements 48,000 — 48,000 — Corporate debt 15,101 — 15,101 — Total assets at fair value $ 74,657 $ 11,556 $ 63,101 $ — |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Term Loans — On October 3, 2016, the Company entered into a loan and security agreement, (the "Loan Agreement"), with Pacific Western Bank, as the collateral agent and a lender (the "Lender"), pursuant to which the Lender agreed to lend to the Company up to $20.0 million in a series of term loans. Contemporaneously, the Company borrowed $10.0 million from the Lender (the "Term A Loan"). Under the terms of the Loan Agreement, because the Company achieved positive clinical results from the STRIVE Phase 2 clinical trial of rezafungin by March 31, 2018, the Company could, at its sole discretion through October 3, 2018, borrow from the Lender up to an additional $10.0 million (the "Term B Loan," and together with the Term A Loan, the "Term Loans"). The Company did not borrow any funds available under the Term B Loan before the draw period ended. On June 13, 2018, the Company and the Lender entered into a First Amendment to the Loan Agreement, which reset the operating covenant to require the Company to achieve positive data from Part B of the STRIVE Phase 2 clinical trial of rezafungin on or prior to July 31, 2019 (the "Milestone"). Upon the occurrence of certain events, including but not limited to the Company’s failure to satisfy its payment obligations under the Loan Agreement, the breach of certain of its other covenants under the Loan Agreement, including the Milestone, or the occurrence of a material adverse change, the collateral agent will have the right, among other remedies, to declare all principal and interest and other amounts due to the Lender under the Loan Agreement immediately due and payable. The Company’s obligations under the Loan Agreement are secured by a first priority security interest in substantially all of the Company’s current and future assets, other than its intellectual property, which is subject to a double negative pledge. On July 27, 2018, the Company and the Lender entered into a Second Amendment to the Loan Agreement, which amended, among other things, the interest-only period, the date of maturity (the "Maturity Date") and the interest rate. The Maturity Date is January 3, 2022. Payments under the Term Loans will be interest-only through July 31, 2019, which will be extended to October 31, 2019 if the Milestone is achieved. The interest-only period will be followed by equal monthly payments of principal and interest. The Term Loans will bear interest at a variable annual rate equal to the greater of (i) 4.5 % or (ii) the Lender’s prime interest rate plus 0.75 %. At September 30, 2018 , the Term Loans bear interest at 6.0 %. The Company evaluated the First and Second Amendments to evaluate whether the amendments represented modifications or extinguishment of debt. The Company determined that the amendments did not represent a substantial change from the original Loan Agreement and accounted for the amendments as debt modifications. Costs previously deferred under the original terms of the Loan Agreement are amortized into interest expense over the new term of the Second Amendment. As of September 30, 2018 , future principal payments due under the Term A Loan are as follows (in thousands): Year ended: December 31, 2018 $ — December 31, 2019 1,667 December 31, 2020 4,000 December 31, 2021 4,000 December 31, 2022 333 Total future principal payments due under the Term A Loan $ 10,000 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITY May 2018 Registered Direct Offering On May 21, 2018, the Company entered into a securities purchase agreement with certain investors providing for the purchase and sale, in a registered direct offering, of up to an aggregate of $120.0 million of its common stock and preferred stock in three closings. On May 23, 2018, the Company completed the first closing, which was comprised of 6,185,987 shares of common stock at an offering price of $4.70 per share, 445,231 shares of Series X Convertible Preferred Stock at an offering price of $47.00 per share, and an option fee relating to the third closing paid by the investors for a total of $0.5 million . In a private placement concurrent with the first closing (the “First Private Placement”), the Company also sold warrants, at $0.125 per warrant share, to purchase an aggregate of 12,499,997 shares of common stock. Net proceeds for the first closing and the First Private Placement were $ 49.5 million . The Company performed an analysis to allocate the proceeds from the May 2018 registered direct offering to the offering's various components on a relative fair value basis, including the contingent forward purchase obligations (discussed further in Note 4) as well as the common stock, Series X Convertible Preferred Stock, warrants, and option fee. With respect to the Series X Convertible Preferred Stock, because the adjusted conversion price on the commitment date (following the allocation of proceeds on a fair value basis) was below the fair value of the common stock at the date of issuance, a beneficial conversion feature with a calculated fair value of $10.3 million existed at the issuance date. The beneficial conversion feature is amortized as a deemed dividend to the preferred holders. As the Series X Convertible Preferred Stock is fully convertible at issuance, the full amortization of the $10.3 million was recorded at issuance as a one-time deemed dividend on May 23, 2018. This one-time, non-cash deemed dividend impacted net loss attributable to common stockholders and net loss attributable to common stockholders per share for the nine months ended September 30, 2018 . In the second closing of the offering, the Company may sell up to an additional $50.0 million in shares of common stock to investors who purchased at least $1.0 million of shares of common stock in the first closing of the offering at a purchase price per share that is equal to 75% of the volume weighted average price of the common stock for the five trading days following the Company’s public release of topline data from Part B of its STRIVE global, randomized Phase 2 clinical trial of rezafungin, provided that the Company will not be obligated to complete the second closing of the offering if the purchase price is less than $4.70 per share. In the optional third closing, which would be held five trading days following the second closing, purchasers who fully participate in the second closing may, at their option, purchase up to an additional $20.0 million of common stock at a purchase price per share equal to the purchase price of the shares purchased at the second closing. At the Company’s option, and prior to the completion of the second or third closing, as applicable, the Company may reduce the aggregate offering size of the such closing by the dollar amount received by the Company from any (i) strategic partnership or other non-dilutive source of funding or (ii) sale of equity securities at a price greater than $6.81 per share. The Company will also offer to each purchaser in the second or third closing the opportunity, in lieu of purchasing common stock, to purchase Series X Convertible Preferred Stock. For each share of Series X Convertible Preferred Stock purchased in the offering in lieu of common stock, the Company will reduce the number of shares of common stock being sold by 10 shares. Each share of Series X Convertible Preferred Stock is convertible into 10 shares of common stock. As the issuance of the additional closings are outside the control of the Company, the second closing and optional third closing are accounted for as a liability in accordance with ASC 480, "Distinguishing Liabilities from Equity," which is measured at fair value on a recurring basis. See Note 4 to our financial statements for additional information. In a private placement to be held concurrently with the optional third closing (the “Second Private Placement”), the Company would sell warrants to purchase up to 2,500,000 shares of Common Stock to the purchasers that participate, at a purchase price of $0.125 per warrant share (such warrants, together with the warrants sold in the First Private Placement, each, a “Warrant”, and collectively, the “Warrants”). The Warrants are exercisable immediately for cash at an exercise price of $6.81 per share. The Warrants issued in the First Private Placement will expire upon the earliest of (i) five years from the date of the first closing of the offering, (ii) the date that the holder of such Warrant transfers or sells any of the shares of Common Stock purchased by such holder in the first closing of the offering, if such transfer or sale occurs prior to the date that is 120 calendar days following the closing of the first closing of the offering, (iii) the taking of any short position on the Common Stock by the holder of such Warrant prior to the completion of the second closing of the offering, and (iv) the failure by the holder of such Warrant to purchase its pro rata allocation of shares of Common Stock in the second closing of the offering. The Warrants issued in the Second Private Placement will expire five years from the date of the third closing of the offering. Preferred Stock Under the amended and restated certificate of incorporation, the Company’s board of directors has the authority, without further action by the stockholders, to issue up to 10,000,000 shares of preferred stock in one or more series, to establish from time to time the number of shares to be included in each such series, to fix the rights, preferences and privileges of the shares of each wholly unissued series and any qualifications, limitations or restrictions thereon and to increase or decrease the number of shares of any such series, but not below the number of shares of such series then outstanding. The Company had 10,000,000 shares of preferred stock authorized at September 30, 2018 . In May 2018, the Company designated 5,000,000 shares of preferred stock as Series X Convertible Preferred Stock with a par value of $0.0001 per share. As of September 30, 2018 , 445,231 shares of Series X Convertible Preferred Stock were issued and outstanding. The specific terms of the Series X Convertible Preferred Stock are as follows: Conversion: Each share of Series X Convertible Preferred Stock is convertible at the option of the holder into 10 shares of common stock. Holders are not permitted to convert Series X Convertible Preferred Stock into common stock if, after conversion, the holder, its affiliates, and any other person whose beneficial ownership of common stock would be aggregated with the holder's for purposes of Section 13(d) or Section 16 of the Exchange Act, would beneficially own more than 9.99% of the number of shares of common stock outstanding immediately after the conversion. Dividends: Holders of Series X Convertible Preferred Stock are not entitled to receive any dividends except to the extent that dividends are paid on the Company's common stock. If dividends are paid on shares of common stock, holders of Series X Convertible Preferred Stock are entitled to participate in such dividends on an as-converted basis. Liquidation: Upon the liquidation, dissolution, or winding up of the company, each holder of Series X Convertible Preferred Stock will participate pari passu with any distribution of proceeds to holders of common stock. Voting: Shares of Series X Convertible Preferred Stock will generally have no voting rights, except as required by law and except that the consent of the holders of a majority of the outstanding Series X Convertible Preferred Stock will be required to amend the terms of the Series X Convertible Preferred Stock , if such action would adversely alter or change the preferences, rights, privileges or powers of, or restrictions provided for the benefit of the Series X Convertible Preferred Stock, or to increase or decrease (other than by conversion) the number of authorized shares of Series X Convertible Preferred Stock. Common Stock The Company had 200,000,000 shares of common stock authorized as of September 30, 2018 . Holders of outstanding shares of common stock are entitled to one vote for each share held of record on all matters submitted to a vote of the holders of common stock. Subject to the rights of the holders of any class of the Company’s capital stock having any preference or priority over common stock, the holders of common stock are entitled to receive dividends that are declared by the Company’s board of directors out of legally available funds. In the event of a liquidation, dissolution or winding-up, the holders of common stock are entitled to share ratably in the net assets remaining after payment of liabilities, subject to rights of preferred stock, if any, then outstanding. The common stock has no preemptive rights, conversion rights, redemption rights or sinking fund provisions, and there are no dividends in arrears or default. All shares of common stock have equal distribution, liquidation and voting rights, and have no preferences or exchange rights. In November 2017, the Company began to sell shares of common stock under a controlled equity sales agreement with Cantor Fitzgerald & Co. The Company voluntarily terminated the controlled equity sales agreement on May 20, 2018. During the nine months ended September 30, 2018 , the Company sold 847,937 shares of common stock pursuant to the controlled equity sales agreement for net proceeds of approximately $6.4 million after deducting placement agent fees. Common Stock Reserved for Future Issuance Common stock reserved for future issuance is as follows (in common stock equivalent shares): September 30, 2018 December 31, 2017 Common stock warrants 12,517,328 17,331 Series X Convertible Preferred Stock 4,452,310 — Stock options and RSUs issued and outstanding 4,083,233 3,099,173 Authorized for future stock awards under the Company's option plans 981,811 1,006,307 Authorized for future issuance under the ESPP 492,665 380,875 Total 22,527,347 4,503,686 |
STOCK INCENTIVE PLANS
STOCK INCENTIVE PLANS | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK INCENTIVE PLANS | STOCK INCENTIVE PLANS 2015 Equity Incentive Plan In March 2015, the Company’s board of directors and stockholders approved and adopted the 2015 Equity Incentive Plan (“2015 EIP”). Under the 2015 EIP, the Company may grant stock options, stock appreciation rights, restricted stock, RSUs, and other awards to individuals who are employees, officers, directors, or consultants of the Company. The number of shares of stock available for issuance under the 2015 EIP will be automatically increased each January 1 by 4% of the outstanding number of shares of the Company’s common stock on the immediately preceding December 31 or such lesser number as determined by the Company’s board of directors. Terms of stock award agreements, including vesting requirements, are determined by the board of directors, subject to the provisions of the 2015 EIP. Stock options granted by the Company generally vest over a three - or four -year period. Certain stock options are subject to acceleration of vesting in the event of certain change of control transactions. The stock options may be granted for a term of up to 10 years from the date of grant. The exercise price for stock options granted under the 2015 EIP must be at a price no less than 100% of the estimated fair value of the shares on the date of grant as determined by the board of directors, provided that for an incentive stock option granted to an employee who at the time of grant owns stock representing more than 10% of the voting power of all classes of stock of the Company, the exercise price shall be no less than 110% of the estimated value on the date of grant. 2015 Employee Stock Purchase Plan In March 2015, the Company’s board of directors and stockholders approved and adopted the 2015 Employee Stock Purchase Plan ("ESPP"). The number of shares of stock available for issuance under the ESPP will be automatically increased each January 1 by the lesser of (i) 1% of the outstanding number of shares of the Company’s common stock on the immediately preceding December 31, (ii) 490,336 shares, or (iii) such lesser number as determined by the Company’s board of directors. The ESPP allows substantially all employees to purchase the Company’s common stock through a payroll deduction at a price equal to 85% of the lower of the fair market value of the stock as of the beginning or the end of each purchase period. An employee’s payroll deductions under the ESPP are limited to 15% of the employee’s eligible compensation. During the nine months ended September 30, 2018 , 93,483 shares were issued pursuant to the ESPP. Restricted Stock The Company permits exercise of certain stock options prior to vesting. Any such exercised shares are restricted and subject to repurchase by the Company until the conditions for vesting are met. At September 30, 2018 there was no liability for cash received from the early exercise of stock options. At December 31, 2017 , the liabilities for the cash received from the early exercise of stock options was $21,000 and was classified in accrued liabilities on the balance sheet. The Company reduces the liability as the underlying shares vest in accordance with the vesting terms outlined in the stock option agreements, which are generally 4 years . At September 30, 2018 , 18 unvested shares were subject to repurchase by the Company. Restricted Stock Units The following table summarizes RSU and PRSU activity during the nine months ended September 30, 2018 : Number of Outstanding at December 31, 2017 227,500 RSUs and PRSUs granted 30,000 RSUs and PRSUs vested — RSUs and PRSUs canceled (20,000 ) Outstanding at September 30, 2018 237,500 For the nine months ended September 30, 2018 , stock-based compensation expense related to RSUs and PRSUs was approximately $194,000 . At September 30, 2018 , estimated unrecognized compensation expense related to RSUs and PRSUs granted to employees was approximately $1.0 million . Stock Options The following table summarizes stock option activity during the nine months ended September 30, 2018 : Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life in Years Total Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2017 3,099,173 $ 7.74 8.10 $ 2,264 Options granted 1,143,250 4.34 Options exercised (89,031 ) 2.29 Options canceled (307,659 ) 8.40 Outstanding at September 30, 2018 3,845,733 $ 6.80 7.49 $ 1,236 Vested and expected to vest at September 30, 2018 3,845,733 $ 6.80 7.49 $ 1,236 Exercisable at September 30, 2018 2,207,784 $ 7.32 6.91 $ 914 The intrinsic value of a stock option is the difference between the market price of the common stock at the measurement date and the exercise price of the option. Stock-based compensation expense recognized for restricted shares, RSUs, PRSUs, stock options, and the ESPP has been reported in the statements of operations as follows (in thousands): Three Months Ended Nine Months Ended 2018 2017 2018 2017 Research and development $ 623 $ 666 $ 1,992 $ 1,805 General and administrative 662 889 2,354 2,401 Total $ 1,285 $ 1,555 $ 4,346 $ 4,206 The weighted-average grant date fair value of employee stock options granted by the Company during the nine months ended September 30, 2018 was $3.06 per share. The total grant date fair value of employee stock options that vested during the nine months ended September 30, 2018 was $2.7 million . As of September 30, 2018 , total unrecognized share-based compensation expense related to unvested employee stock options of the Company was approximately $5.7 million . This unrecognized compensation cost is expected to be recognized over a weighted-average period of approximately 2.1 years. As of September 30, 2018 , total unrecognized compensation expense related to the ESPP was approximately $0.6 million . This unrecognized compensation cost is expected to be recognized over approximately 0.6 years . Common Stock Warrants A summary of warrant activity for the nine months ended September 30, 2018 is presented below: Warrants Weighted Average Exercise Price Total Intrinsic Value Outstanding at December 31, 2017 17,331 $ 11.54 $ — Issued 12,499,997 6.81 — Exercised — — — Canceled — — — Outstanding at September 30, 2018 12,517,328 $ 6.82 $ — The intrinsic value of a common stock warrant is the difference between the market price of the common stock at the measurement date and the exercise price of the warrant. |
SIGNIFICANT AGREEMENTS AND CONT
SIGNIFICANT AGREEMENTS AND CONTRACTS | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SIGNIFICANT AGREEMENTS AND CONTRACTS | SIGNIFICANT AGREEMENTS AND CONTRACTS Combating Antibiotic Resistant Bacteria Accelerator (CARB-X) Subaward Agreement On March 30, 2017, the Company entered into a Cost Reimbursement Research Subaward Agreement (the "Subaward Agreement") with the Trustees of Boston University. Under the Subaward Agreement, the Company is a subawardee under the CARB-X program. CARB-X is a public-private partnership focused on antibacterials, created by the U.S. Department of Health and Human Services (HHS), Biomedical Advanced Research and Development Authority (BARDA), and National Institute of Allergy and Infectious Diseases (NIAID). CARB-X is funded by BARDA and the London-based Wellcome Trust, a global charitable foundation (Wellcome), and administered by the Boston University School of Law. The subaward was intended to support development of the Company's CD201 product candidate. Under the Subaward Agreement, during an initial phase that began on April 1, 2017 and ends upon acceptance by the U.S. Food and Drug Administration of an initial new drug application, CARB-X would reimburse up to $3.9 million of qualifying development expenses. If all of the milestones in such initial phase are met, the CARB-X Joint Oversight Committee will evaluate the progress made in such initial phase and determine whether to exercise its option to fund a second stage. During the second stage, CARB-X would reimburse up to $3.0 million of qualifying development expenses through a Phase 1 clinical trial. Such second stage would be subject to a new subaward agreement. Under the Subaward Agreement, the Company is reimbursed for direct costs incurred plus allowable indirect costs which consist of fringe benefits and allowable general and administrative expenses. As of September 30, 2018 , there were no billed or unbilled accounts receivable related to reimbursable expenses under the Subaward Agreement. The Subaward Agreement can be terminated upon the delivery of 30 days written notice to the Company for default or convenience. Upon receipt of a notice of termination, the Company must discontinue contract activities and CARB-X must pay the Company a final settlement based on eligible expenses incurred under the Subaward Agreement. Based on preclinical studies of CD201 as well as preclinical studies of antibody-drug conjugates (ADCs) from the Cloudbreak program, the Company decided in February 2018 to cease development of CD201 to focus on the more promising ADCs for the same indication. Based on the decision to focus efforts on the ADCs, the Company will no longer be seeking funding under the Subaward Agreement relating to CD201. Partnership Grant for the Development of Cloudbreak Antibody-Drug Conjugates In May 2018, the Company and Rutgers University were awarded a five year, $5.5 million partnership grant from the U.S. National Institute of Allergy and Infectious Diseases (NAIAD) and the National Institutes of Health (NIH), an agency of the United States Department of Health and Human Services. The grant will fund continued research and development of the Company's Cloudbreak ADC platform to identify novel immunotherapy agents for the treatment and prevention of serious and life-threatening viral infections and multi-drug resistant (MDR) Gram-negative bacterial infections in high-risk populations. The Company began work under this grant in July 2018 but has not recognized any potential reimbursements in the statements of operations for the three and nine month periods ended September 30, 2018 as the subaward agreement between the Company and Rutgers University has not yet been executed. As of September 30, 2018 there was no accounts receivable related to reimbursable expenses under this grant. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Litigation From time to time, the Company may be involved in various lawsuits, legal proceedings, or claims that arise in the ordinary course of business. Management believes there are no claims or actions pending against the Company as of September 30, 2018 which will have, individually or in the aggregate, a material adverse effect on its business, liquidity, financial position, or results of operations. Litigation, however, is subject to inherent uncertainties, and an adverse result in such matters may arise from time to time that may harm the Company’s business. Lease Obligations In June 2014, the Company entered into an operating lease agreement for laboratory and office space in San Diego, California. Amendments for additional space were entered into in February 2015, March 2015, and August 2015. On June 29, 2018 the Company entered into a Fourth Amendment to its lease which extended the term of the lease by an additional 36 months and increases base rent to $70,000 per month effective January 1, 2019. The Company has also been granted an option, exercisable prior to September 30, 2019, to expand its leased premises on the same terms as the current lease, subject to compliance with specified conditions. The lease expires in December 2021 with options for two individual two -year extensions. The lease is subject to charges for common area maintenance and other costs, and base rent is subject to 3% annual increases every January. Rent expense is recorded on a straight-line basis over the life of the lease. Future minimum payments required under the lease as of September 30, 2018 are summarized as follows (in thousands): 2018 $ 189 2019 836 2020 861 2021 $ 887 Total minimum lease payments $ 2,773 Rent expense was $568,000 and $530,000 for the nine months ended September 30, 2018 and 2017 , respectively. Contractual Obligations The Company enters into contracts in the normal course of business with vendors for research and development activities, manufacturing, and professional services. These contracts generally provide for termination either on notice or within 30 days of notice. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Company has a limited operating history and the sales and income potential of the Company’s business and market are unproven. The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has experienced net losses and negative cash flows from operating activities since its inception. At September 30, 2018 , the Company had an accumulated deficit of $206.4 million . The Company expects to continue to incur net losses into the foreseeable future. Successful transition to attaining profitable operations is dependent upon achieving a level of revenues adequate to support the Company’s cost structure. The Company has prepared cash flow forecasts which indicate, based on its current cash resources available, that it will have sufficient resources to fund its business for at least the next 12 months from the date of this filing. The Company will need to raise additional capital to fund its losses from operations. It anticipates raising capital through debt and equity financing, through government funding or through collaborations or partnerships with other entities. Debt or equity financing, government funding or collaborations and partnerships with other entities may not be available on a timely basis on terms acceptable to the Company, or at all. If the Company is not able to secure adequate additional funding, the Company may be forced to delay, reduce or eliminate its research and development programs or future commercialization efforts, or to make reductions in spending, extend payment terms with suppliers, liquidate or grant rights to assets where possible, or suspend or curtail planned programs. Any of these actions could materially harm the Company’s business, results of operations and future prospects. |
Unaudited Interim Financial Data | Unaudited Interim Financial Data The accompanying condensed consolidated financial statements are unaudited and have been prepared by the Company in accordance with U.S. generally accepted accounting principles, or GAAP, as found in the Accounting Standards Codification, or ASC, of the Financial Accounting Standards Board, or FASB. Certain information and footnote disclosures normally included in the Company’s annual financial statements have been condensed or omitted. These interim condensed consolidated financial statements, in the opinion of management, reflect all normal recurring adjustments necessary for a fair presentation of the Company’s financial position and results of operations for the interim periods ended September 30, 2018 and 2017 . |
Basis of Consolidation | Basis of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of expenses during the reporting period. The Company evaluates its estimates and assumptions on an ongoing basis. The most significant estimates in the Company’s consolidated financial statements relate to estimating the fair value of the Company’s stock options, the fair value of the Company's contingent forward purchase obligations, and certain accruals, including those related to nonclinical and clinical activities. Although the estimates are based on the Company’s knowledge of current events, comparable companies, and actions it may undertake in the future, actual results may ultimately materially differ from these estimates and assumptions. |
Segment Information | Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, the Chief Executive Officer, in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business as one operating segment. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all short-term investments purchased with a maturity of three months or less when acquired to be cash equivalents. |
Investments Available-for-Sale | Investments Available-for-Sale Available-for-sale securities are carried at fair value, with the unrealized gains and losses reported in accumulated other comprehensive loss. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. The amortization of premiums and accretion of discounts is included in interest income. Realized gains and losses and declines in value judged to be other-than-temporary, if any, on available-for-sale securities are included in other income. The cost of securities sold is based on the specific identification method. Interest and dividends on securities classified as available-for-sale are included in interest income. Securities with maturity dates of 12 months or less from the date of purchase are classified as short-term investments and securities with maturity dates of more than 12 months are classified as long-term investments. |
Concentration of Credit Risk | Concentration of Credit Risk The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents and short-term investments. Periodically, the Company maintains deposits in government insured financial institutions in excess of government insured limits. The Company invests its cash balances in financial institutions that it believes have high credit quality, has not experienced any losses on such accounts and does not believe it is exposed to significant credit risk. |
Patent Costs | Patent Costs The Company expenses all costs as incurred in connection with patent applications (including direct application fees and the legal and consulting expenses related to making such applications), and such costs are included in general and administrative expenses in the accompanying statements of operations. |
Income Taxes | Income Taxes The Company follows the FASB's ASC 740, Income Taxes, in reporting deferred income taxes. ASC 740 requires a company to recognize deferred tax assets and liabilities for expected future income tax consequences of events that have been recognized in the Company’s consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates in the years in which the temporary differences are expected to reverse. Valuation allowances are provided if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company accounts for uncertain tax positions pursuant to ASC 740, which prescribes a recognition threshold and measurement process for financial statement recognition of uncertain tax positions taken or expected to be taken in a tax return. If the tax position meets this threshold, the benefit to be recognized is measured as the tax benefit having the highest likelihood of being realized upon ultimate settlement with the taxing authority. The Company recognizes interest accrued related to unrecognized tax benefits and penalties in the provision for income taxes. On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the "Tax Act"), which among other provisions, reduced the U.S. corporate tax rate from 35% to 21%, effective January 1, 2018. Due to the timing of the enactment and the complexity involved in applying the provisions of the Tax Act, the Company made reasonable estimates of the effects and recorded provisional amounts in our financial statements as of December 31, 2017. As the Company collects and prepares necessary data, and continues to interpret the Tax Act and any additional guidance issued by the U.S. Treasury Department, the Internal Revenue Service (IRS) and other standard-setting bodies, the Company may make adjustments to the provisional amounts. Those adjustments may affect deferred tax balances. However, due to the valuation allowance position, the Company expects there will be no net impact to the financial statements. The Company did not make any such adjustments during the quarter ended September 30, 2018 . Any adjustments to account for the tax effects of the Tax Act would be made in a subsequent quarter. |
Revenue Recognition | Revenue Recognition The Company recognizes revenues when customers obtain control of promised goods or services, in an amount that reflects the consideration which it expects to receive in exchange for those goods or services. The Company recognizes revenues following the five step model prescribed under Accounting Standards Update ("ASU") No. 2014-09 ("ASU 2014-09"): (i) identify 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 revenues when (or as) the Company satisfies the performance obligation. Under the Subaward Agreement, the Company is reimbursed for direct costs incurred plus allowable indirect costs which consist of fringe benefits and allowable general and administrative expenses. |
Grant Funding and Research and Development Costs | Grant Funding The Company has received research and development funding through a grant from CARB-X, a public-private partnership focused on antibacterials. The Company has also been awarded a partnership grant with Rutgers University from the U.S. National Institute of Allergy and Infectious Diseases ("NIAID") of the National Institutes of Health ("NIH"), an agency of the United States Department of Health and Human Services. The Company has evaluated the terms of the grants to assess its obligations and the classification of funding received. Amounts billable for funded research and development are recognized in the statement of operations as a reduction to research and development expense over the grant period as the related costs are incurred to meet the Company's obligations. Research and Development Costs Research and development expenses consist of wages, benefits and stock-based compensation charges for research and development employees, scientific consultant fees, facilities and overhead expenses, laboratory supplies, manufacturing expenses, and nonclinical and clinical trial costs. The Company accrues nonclinical and clinical trial expenses based on work performed, which relies on estimates of total costs incurred based on patient enrollment, completion of studies, and other events. Costs incurred in purchasing technology assets and intellectual property are charged to research and development expense if the technology has not been conclusively proven to be feasible and has no alternative future use. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is defined as the change in equity during a period from transactions and other events and/or circumstances from non-owner sources. The Company’s only component of other comprehensive loss is unrealized losses on short-term investments. Comprehensive losses have been reflected in the condensed consolidated statements of operations and comprehensive loss for all periods presented. |
Stock-based Compensation | Stock-based Compensation The Company accounts for stock-based compensation expense related to employee stock options and employee stock purchase plan rights by estimating the fair value on the date of grant using the Black-Scholes option pricing model. The fair value of Restricted Stock Units (RSUs) and Performance-based RSUs (PRSUs) granted to employees is estimated based on the closing price of the Company's common stock on the date of grant. For awards subject to time-based vesting conditions, stock-based compensation expense is recognized ratably over the requisite service period of the awards. For awards subject to performance-based vesting conditions, the Company assesses the probability of achievement of the individual milestones under the stock-based awards and recognizes stock-based compensation expense over the implicit service period commencing once the Company believes the performance criteria is probable of achievement. The Company accounts for stock options, RSUs, and PRSUs granted to non-employees using the fair value approach. These stock-based awards are subject to periodic revaluation over their vesting terms. |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is calculated by dividing the net loss allocable to common shares by the weighted-average number of common shares outstanding for the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss allocable to common shares by the weighted-average number of common shares and dilutive common stock equivalents outstanding for the period determined using the treasury-stock and if-converted methods. Dilutive common stock equivalents are comprised of warrants, unvested restricted common stock subject to repurchase, and RSUs and options outstanding under the Company’s stock option plans. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company follows ASC 820-10 issued by the FASB with respect to fair value reporting for financial assets and liabilities. The guidance defines fair value, provides guidance for measuring fair value and requires certain disclosures. The guidance does not apply to measurements related to share-based payments. The guidance discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The Company’s financial instruments consist of cash and cash equivalents, marketable securities, contingent forward purchase obligations, and long-term debt. Fair value estimates of these instruments are made at a specific point in time based on relevant market information. These estimates may be subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. The carrying amount of cash and cash equivalents, prepaid expenses, accounts payable, and accrued liabilities are generally considered to be representative of their respective fair values because of the short-term nature of those instruments. The fair value of short-term investments is based upon market prices quoted on the last day of the fiscal period or other observable market inputs. The fair value of contingent forward purchase obligations is based on a probability-weighted valuation approach (See Note 4). The Company believes that the fair value of long-term debt approximates its carrying value. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards During 2016, the FASB issued ASU 2016-02, “Leases,” which requires that operating lease arrangements longer than 12 months result in an entity recognizing an asset and liability. The updated guidance is effective for interim and annual periods beginning after December 15, 2018, and early adoption is permitted. The Company currently expects that its operating lease commitments will be subject to the new standard and recognized as right-of-use assets and operating lease liabilities upon the adoption of ASU 2016-02, which will increase the total assets and total liabilities that it reports relative to such amounts prior to adoption. During 2018, the FASB issued ASU 2018-07, "Improvements to Nonemployee Share-Based Payment Accounting," which expanded the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees. Under the ASU, the guidance on such payments to nonemployees is aligned with the accounting for share-based payments granted to employees, including the measurement of equity-classified awards, which is fixed at the grant date under the new guidance. The updated guidance is effective for interim and annual periods beginning after December 15, 2018, and early adoption is permitted. The Company is currently assessing the impact that this standard will have on its consolidated financial statements. During 2018, the FASB issued ASU 2018-13, "Changes to the Disclosure Requirements for Fair Value Measurement," which modifies certain disclosure requirements on fair value measurements. The updated guidance is effective for interim and annual periods beginning after December 15, 2019, and early adoption is permitted. The Company is currently assessing the impact that this standard will have on its consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Outstanding Potentially Dilutive Securities Excluded from Calculation of Diluted Net Loss Per Share | The following table sets forth the outstanding potentially dilutive securities that have been excluded in the calculation of diluted net loss per share because to do so would be anti-dilutive (in common stock equivalent shares): September 30, 2018 2017 Common stock warrants 12,517,328 17,331 Series X Convertible Preferred stock 4,452,310 — Common stock options and RSUs issued and outstanding 4,083,233 3,323,599 Common stock subject to repurchase 18 13,269 Total 21,052,889 3,354,199 |
SHORT-TERM INVESTMENTS (Tables)
SHORT-TERM INVESTMENTS (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Available-for-Sale Securities | The following table summarizes the available-for-sale securities held at September 30, 2018 and December 31, 2017 (in thousands): As of September 30, 2018 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Corporate debt $ 2,498 $ — $ (1 ) $ 2,497 U.S. Treasury Bill 1,997 — — 1,997 Total $ 4,495 $ — $ (1 ) $ 4,494 As of December 31, 2017 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Corporate debt $ 14,509 $ — $ (8 ) $ 14,501 Total $ 14,509 $ — $ (8 ) $ 14,501 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Summary of Financial Instruments Measured at Fair Value on a Recurring Basis | The following tables summarize the Company’s financial instruments measured at fair value on a recurring basis (in thousands): TOTAL LEVEL 1 LEVEL 2 LEVEL 3 September 30, 2018 Assets: Money market funds $ 83,064 $ 83,064 $ — $ — U.S. Treasury bill 1,997 1,997 — — Corporate debt 2,497 — 2,497 — Total assets at fair value $ 87,558 $ 85,061 $ 2,497 $ — Liabilities: Contingent forward purchase obligations $ 4,486 $ — $ — $ 4,486 Total liabilities at fair value $ 4,486 $ — $ — $ 4,486 December 31, 2017 Assets: Money market funds $ 11,556 $ 11,556 $ — $ — U.S. Treasury reverse repurchase agreements 48,000 — 48,000 — Corporate debt 15,101 — 15,101 — Total assets at fair value $ 74,657 $ 11,556 $ 63,101 $ — |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Future Principal Payments | As of September 30, 2018 , future principal payments due under the Term A Loan are as follows (in thousands): Year ended: December 31, 2018 $ — December 31, 2019 1,667 December 31, 2020 4,000 December 31, 2021 4,000 December 31, 2022 333 Total future principal payments due under the Term A Loan $ 10,000 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Schedule of Common Stock Reserved for Future Issuance | Common stock reserved for future issuance is as follows (in common stock equivalent shares): September 30, 2018 December 31, 2017 Common stock warrants 12,517,328 17,331 Series X Convertible Preferred Stock 4,452,310 — Stock options and RSUs issued and outstanding 4,083,233 3,099,173 Authorized for future stock awards under the Company's option plans 981,811 1,006,307 Authorized for future issuance under the ESPP 492,665 380,875 Total 22,527,347 4,503,686 |
STOCK INCENTIVE PLANS (Tables)
STOCK INCENTIVE PLANS (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of RSU and PRSU Activity | The following table summarizes RSU and PRSU activity during the nine months ended September 30, 2018 : Number of Outstanding at December 31, 2017 227,500 RSUs and PRSUs granted 30,000 RSUs and PRSUs vested — RSUs and PRSUs canceled (20,000 ) Outstanding at September 30, 2018 237,500 |
Summary of Stock Option Activity | The following table summarizes stock option activity during the nine months ended September 30, 2018 : Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life in Years Total Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2017 3,099,173 $ 7.74 8.10 $ 2,264 Options granted 1,143,250 4.34 Options exercised (89,031 ) 2.29 Options canceled (307,659 ) 8.40 Outstanding at September 30, 2018 3,845,733 $ 6.80 7.49 $ 1,236 Vested and expected to vest at September 30, 2018 3,845,733 $ 6.80 7.49 $ 1,236 Exercisable at September 30, 2018 2,207,784 $ 7.32 6.91 $ 914 |
Schedule of Stock-based Compensation Expense | Stock-based compensation expense recognized for restricted shares, RSUs, PRSUs, stock options, and the ESPP has been reported in the statements of operations as follows (in thousands): Three Months Ended Nine Months Ended 2018 2017 2018 2017 Research and development $ 623 $ 666 $ 1,992 $ 1,805 General and administrative 662 889 2,354 2,401 Total $ 1,285 $ 1,555 $ 4,346 $ 4,206 |
Summary of Common Stock Warrant Activity | A summary of warrant activity for the nine months ended September 30, 2018 is presented below: Warrants Weighted Average Exercise Price Total Intrinsic Value Outstanding at December 31, 2017 17,331 $ 11.54 $ — Issued 12,499,997 6.81 — Exercised — — — Canceled — — — Outstanding at September 30, 2018 12,517,328 $ 6.82 $ — |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Payments Required | Future minimum payments required under the lease as of September 30, 2018 are summarized as follows (in thousands): 2018 $ 189 2019 836 2020 861 2021 $ 887 Total minimum lease payments $ 2,773 |
THE COMPANY AND BASIS OF PRES_2
THE COMPANY AND BASIS OF PRESENTATION (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018USD ($)segment | Dec. 31, 2017USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated deficit | $ | $ 206,393 | $ 149,390 |
Number of operating segments | segment | 1 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Anti-Dilutive Securities (Details) - shares | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share (in shares) | 21,052,889 | 3,354,199 |
Common stock warrants | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share (in shares) | 12,517,328 | 17,331 |
Series X Convertible Preferred stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share (in shares) | 4,452,310 | 0 |
Common stock options and RSUs issued and outstanding | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share (in shares) | 4,083,233 | 3,323,599 |
Common stock subject to repurchase | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share (in shares) | 18 | 13,269 |
SHORT-TERM INVESTMENTS (Details
SHORT-TERM INVESTMENTS (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Schedule Of Available For Sale Securities [Line Items] | |||
Amortized Cost | $ 4,495,000 | $ 14,509,000 | |
Unrealized Gains | 0 | 0 | |
Unrealized Losses | (1,000) | (8,000) | |
Fair Value | $ 4,494,000 | $ 14,501,000 | |
Maturity of available-for-sale securities (less than) (term) | 1 year | 1 year | |
Impairment of available-for-sale securities | $ 0 | $ 0 | |
Gains (losses) on available for sale securities | 0 | $ 0 | |
Corporate debt | |||
Schedule Of Available For Sale Securities [Line Items] | |||
Amortized Cost | 2,498,000 | $ 14,509,000 | |
Unrealized Gains | 0 | 0 | |
Unrealized Losses | (1,000) | (8,000) | |
Fair Value | 2,497,000 | $ 14,501,000 | |
U.S. Treasury Bill | |||
Schedule Of Available For Sale Securities [Line Items] | |||
Amortized Cost | 1,997,000 | ||
Unrealized Gains | 0 | ||
Unrealized Losses | 0 | ||
Fair Value | $ 1,997,000 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) | May 21, 2018USD ($)closing | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) |
Class of Stock [Line Items] | |||||
Contingent forward purchase obligations | $ 4,300,000 | ||||
Gain (loss) - fair value adjustments | $ 888,000 | $ 0 | $ (224,000) | $ 0 | |
Registered direct offering | |||||
Class of Stock [Line Items] | |||||
Aggregate value of shares authorized to be sold | $ 120,000,000 | ||||
Number of direct offering closings | closing | 3 |
FAIR VALUE MEASUREMENTS - Summa
FAIR VALUE MEASUREMENTS - Summary of Financial Instruments Measured at Fair Value (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | May 21, 2018 | Dec. 31, 2017 |
Liabilities: | |||
Contingent forward purchase obligations | $ 4,300 | ||
Fair Value Measurements, Recurring | |||
Assets: | |||
Total assets at fair value | $ 87,558 | $ 74,657 | |
Liabilities: | |||
Contingent forward purchase obligations | 4,486 | ||
Total liabilities at fair value | 4,486 | ||
Fair Value Measurements, Recurring | Money market funds | |||
Assets: | |||
Total assets at fair value | 83,064 | 11,556 | |
Fair Value Measurements, Recurring | U.S. Treasury Bill | |||
Assets: | |||
Total assets at fair value | 1,997 | ||
Fair Value Measurements, Recurring | Corporate debt | |||
Assets: | |||
Total assets at fair value | 2,497 | 15,101 | |
Fair Value Measurements, Recurring | U.S. Treasury reverse repurchase agreements | |||
Assets: | |||
Total assets at fair value | 48,000 | ||
Fair Value Measurements, Recurring | LEVEL 1 | |||
Assets: | |||
Total assets at fair value | 85,061 | 11,556 | |
Liabilities: | |||
Contingent forward purchase obligations | 0 | ||
Total liabilities at fair value | 0 | ||
Fair Value Measurements, Recurring | LEVEL 1 | Money market funds | |||
Assets: | |||
Total assets at fair value | 83,064 | 11,556 | |
Fair Value Measurements, Recurring | LEVEL 1 | U.S. Treasury Bill | |||
Assets: | |||
Total assets at fair value | 1,997 | ||
Fair Value Measurements, Recurring | LEVEL 1 | Corporate debt | |||
Assets: | |||
Total assets at fair value | 0 | 0 | |
Fair Value Measurements, Recurring | LEVEL 1 | U.S. Treasury reverse repurchase agreements | |||
Assets: | |||
Total assets at fair value | 0 | ||
Fair Value Measurements, Recurring | LEVEL 2 | |||
Assets: | |||
Total assets at fair value | 2,497 | 63,101 | |
Liabilities: | |||
Contingent forward purchase obligations | 0 | ||
Total liabilities at fair value | 0 | ||
Fair Value Measurements, Recurring | LEVEL 2 | Money market funds | |||
Assets: | |||
Total assets at fair value | 0 | 0 | |
Fair Value Measurements, Recurring | LEVEL 2 | U.S. Treasury Bill | |||
Assets: | |||
Total assets at fair value | 0 | ||
Fair Value Measurements, Recurring | LEVEL 2 | Corporate debt | |||
Assets: | |||
Total assets at fair value | 2,497 | 15,101 | |
Fair Value Measurements, Recurring | LEVEL 2 | U.S. Treasury reverse repurchase agreements | |||
Assets: | |||
Total assets at fair value | 48,000 | ||
Fair Value Measurements, Recurring | LEVEL 3 | |||
Assets: | |||
Total assets at fair value | 0 | 0 | |
Liabilities: | |||
Contingent forward purchase obligations | 4,486 | ||
Total liabilities at fair value | 4,486 | ||
Fair Value Measurements, Recurring | LEVEL 3 | Money market funds | |||
Assets: | |||
Total assets at fair value | 0 | 0 | |
Fair Value Measurements, Recurring | LEVEL 3 | U.S. Treasury Bill | |||
Assets: | |||
Total assets at fair value | 0 | ||
Fair Value Measurements, Recurring | LEVEL 3 | Corporate debt | |||
Assets: | |||
Total assets at fair value | $ 0 | 0 | |
Fair Value Measurements, Recurring | LEVEL 3 | U.S. Treasury reverse repurchase agreements | |||
Assets: | |||
Total assets at fair value | $ 0 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) - Term Loan - USD ($) | Jul. 27, 2018 | Sep. 30, 2018 | Oct. 03, 2016 |
Loan Agreement | |||
Debt Instrument [Line Items] | |||
Term loans, maximum borrowing capacity | $ 20,000,000 | ||
Term A Loan | |||
Debt Instrument [Line Items] | |||
Borrowed from the Lender | 10,000,000 | ||
Term B Loan | |||
Debt Instrument [Line Items] | |||
Term loans, maximum borrowing capacity | $ 10,000,000 | ||
Loan Agreement, second amendment | |||
Debt Instrument [Line Items] | |||
Variable annual rate | 450.00% | 6.00% | |
Loan Agreement, second amendment | Prime Rate | |||
Debt Instrument [Line Items] | |||
Prime interest rate | 75.00% |
DEBT - Schedule of Future Princ
DEBT - Schedule of Future Principal Payments (Details) - Term A Loan - Term Loan $ in Thousands | Sep. 30, 2018USD ($) |
Year ended: | |
December 31, 2018 | $ 0 |
December 31, 2019 | 1,667 |
December 31, 2020 | 4,000 |
December 31, 2021 | 4,000 |
December 31, 2022 | 333 |
Total future principal payments due under the Term A Loan | $ 10,000 |
STOCKHOLDERS' EQUITY - Narrativ
STOCKHOLDERS' EQUITY - Narrative (Details) | May 23, 2018USD ($)$ / sharesshares | May 21, 2018USD ($)closingday$ / sharesshares | Sep. 30, 2018USD ($)$ / sharesshares | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)vote_per_share$ / sharesshares | Sep. 30, 2017USD ($) | May 31, 2018$ / sharesshares | Dec. 31, 2017$ / sharesshares |
Class of Stock [Line Items] | ||||||||
Recognition of beneficial conversion feature | $ | $ 10,300,000 | $ 0 | $ 0 | $ 10,329,000 | $ 0 | |||
Share price allowing the reduction of the aggregate offering size (in dollars per share) | $ / shares | $ 6.81 | |||||||
Number of common shares reduced by each preferred share sold (in shares) | 10 | |||||||
Term of warrants following closing of first closing of the offering | 120 days | |||||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | 10,000,000 | |||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 | 200,000,000 | |||||
Number of votes for each share held | vote_per_share | 1 | |||||||
Dividends in arrears or default | $ | $ 0 | |||||||
Registered direct offering | ||||||||
Class of Stock [Line Items] | ||||||||
Aggregate value of shares authorized to be sold | $ | $ 120,000,000 | |||||||
Number of direct offering closings | closing | 3 | |||||||
Registered direct offering, first closing | ||||||||
Class of Stock [Line Items] | ||||||||
Shares sold (in shares) | 6,185,987 | |||||||
Offering price (in dollars per share) | $ / shares | $ 4.70 | |||||||
Registered direct offering, third closing | ||||||||
Class of Stock [Line Items] | ||||||||
Aggregate value of shares authorized to be sold | $ | $ 20,000,000 | |||||||
Option fee paid by investors relating to third closing | $ | $ 500,000 | |||||||
Number of trading days between second and third closing | day | 5 | |||||||
Registered direct offering, second closing | ||||||||
Class of Stock [Line Items] | ||||||||
Aggregate value of shares authorized to be sold | $ | $ 50,000,000 | |||||||
Offering price (in dollars per share) | $ / shares | $ 4.70 | |||||||
Minimum value of shares purchased in order to participate in second closing | $ | $ 1,000,000 | |||||||
Percent of the price per share of the volume weighted average price of common stock for the five trading days following the Company's public release of data | 75.00% | |||||||
Registered direct offering, first closing and First Private Placement | ||||||||
Class of Stock [Line Items] | ||||||||
Net proceeds | $ | $ 49,500,000 | |||||||
Second Private Placement | ||||||||
Class of Stock [Line Items] | ||||||||
Shares sold (in shares) | 2,500,000 | |||||||
Offering price (in dollars per share) | $ / shares | $ 0.125 | |||||||
Controlled equity sales agreement with Cantor Fitzgerald And Company | ||||||||
Class of Stock [Line Items] | ||||||||
Shares sold (in shares) | 847,937 | |||||||
Net proceeds | $ | $ 6,400,000 | |||||||
Common stock warrants | First Private Placement | ||||||||
Class of Stock [Line Items] | ||||||||
Shares sold (in shares) | 12,499,997 | |||||||
Offering price (in dollars per share) | $ / shares | $ 0.125 | |||||||
Exercise price of warrant (in dollars per share) | $ / shares | $ 6.81 | |||||||
Term of warrant | 5 years | |||||||
Common stock warrants | Second Private Placement | ||||||||
Class of Stock [Line Items] | ||||||||
Term of warrant | 5 years | |||||||
Series X Convertible Preferred Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Beneficial conversion feature fair value | $ | $ 10,300,000 | |||||||
Common stock issued for each preferred stock (in shares) | 10 | 10 | 10 | |||||
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 | 5,000,000 | 0 | ||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Preferred stock issued (in shares) | 445,231 | 445,231 | 0 | |||||
Preferred stock outstanding (in shares) | 445,231 | 445,231 | 0 | |||||
Maximum ownership following conversion | 9.99% | |||||||
Series X Convertible Preferred Stock | Registered direct offering, first closing | ||||||||
Class of Stock [Line Items] | ||||||||
Shares sold (in shares) | 445,231 | |||||||
Offering price (in dollars per share) | $ / shares | $ 47 |
STOCKHOLDERS' EQUITY - Schedule
STOCKHOLDERS' EQUITY - Schedule of Common Stock Reserved for Future Issuance (Details) - shares | Sep. 30, 2018 | Dec. 31, 2017 |
Class of Stock [Line Items] | ||
Total (in shares) | 22,527,347 | 4,503,686 |
Common stock warrants | ||
Class of Stock [Line Items] | ||
Total (in shares) | 12,517,328 | 17,331 |
Series X Convertible Preferred Stock | ||
Class of Stock [Line Items] | ||
Total (in shares) | 4,452,310 | 0 |
Stock options and RSUs issued and outstanding | ||
Class of Stock [Line Items] | ||
Total (in shares) | 4,083,233 | 3,099,173 |
Authorized for future stock awards under the Company's option plans | ||
Class of Stock [Line Items] | ||
Total (in shares) | 981,811 | 1,006,307 |
Authorized for future issuance under the ESPP | ||
Class of Stock [Line Items] | ||
Total (in shares) | 492,665 | 380,875 |
STOCK INCENTIVE PLANS - Narrat
STOCK INCENTIVE PLANS - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2015 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Weighted-average grant date fair value of employee stock options granted (in dollars per share) | $ 3.06 | |||||
Grant date fair value of employee stock options vested | $ 2,700,000 | |||||
Total unrecognized share-based compensation expense related to unvested employee stock options | $ 5,700,000 | $ 5,700,000 | ||||
Period to recognize unrecognized compensation cost | 2 years 29 days | |||||
Stock-based compensation expense | 1,285,000 | $ 1,555,000 | $ 4,346,000 | $ 4,206,000 | ||
ESPP | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Automatic increase in shares of stock available (as a percent) | 1.00% | |||||
Price of stock option as percentage of estimated fair value of shares on date of grant | 85.00% | |||||
Limit on employee's payroll deductions as a percentage of eligible compensation | 15.00% | |||||
Issued pursuant to the ESPP (in shares) | 93,483 | |||||
Period to recognize unrecognized compensation cost | 7 months 13 days | |||||
Estimated unrecognized share-based compensation expense | 600,000 | $ 600,000 | ||||
Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Cash received from early exercise of stock options | 0 | $ 0 | $ 21,000 | |||
Restricted Stock Units and Performance-based Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock-based compensation expense | 194,000 | |||||
Estimated unrecognized share-based compensation expense | $ 1,000,000 | $ 1,000,000 | ||||
Subject to repurchase | Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unvested shares subject to repurchase (in shares) | 18 | 18 | ||||
Maximum | ESPP | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Automatic increase in number of shares available for issuance (in shares) | 490,336 | |||||
2015 EIP | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Automatic increase in shares of stock available (as a percent) | 4.00% | |||||
Term for stock options to be granted | 10 years | |||||
Price of stock option as percentage of estimated fair value of shares on date of grant | 100.00% | |||||
Voting power threshold (as a percent) | 10.00% | |||||
2015 EIP | More than 10% of voting power | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Price of stock option as percentage of estimated fair value of shares on date of grant | 110.00% | |||||
2015 EIP | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 3 years | |||||
2015 EIP | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years |
STOCK INCENTIVE PLANS - Summary
STOCK INCENTIVE PLANS - Summary of Restricted Stock Units and Performance-based Restricted Stock Units Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Number of RSUs and PRSUs | ||||
Stock-based compensation expense | $ 1,285 | $ 1,555 | $ 4,346 | $ 4,206 |
Restricted Stock Units and Performance-based Restricted Stock Units | ||||
Number of RSUs and PRSUs | ||||
Outstanding, beginning balance (in shares) | 227,500 | |||
Granted (in shares) | 30,000 | |||
Vested (in shares) | 0 | |||
Canceled (in shares) | (20,000) | |||
Outstanding, ending balance (in shares) | 237,500 | 237,500 | ||
Stock-based compensation expense | $ 194 | |||
Estimated unrecognized share-based compensation expense | $ 1,000 | $ 1,000 |
STOCK INCENTIVE PLANS - Summa_2
STOCK INCENTIVE PLANS - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Number of Shares | ||
Outstanding, beginning balance (in shares) | 3,099,173 | |
Options granted (in shares) | 1,143,250 | |
Options exercised (in shares) | (89,031) | |
Options canceled (in shares) | (307,659) | |
Outstanding, ending balance (in shares) | 3,845,733 | 3,099,173 |
Vested and expected to vest (in shares) | 3,845,733 | |
Exercisable (in shares) | 2,207,784 | |
Weighted Average Exercise Price | ||
Outstanding, beginning balance (in dollars per share) | $ 7.74 | |
Options granted (in dollars per share) | 4.34 | |
Options exercised (in dollars per share) | 2.29 | |
Options canceled (in dollars per share) | 8.40 | |
Outstanding, ending balance (in dollars per share) | 6.80 | $ 7.74 |
Vested and expected to vest (in dollars per share) | 6.80 | |
Exercisable (in dollars per share) | $ 7.32 | |
Weighted Average Remaining Contractual Life | ||
Outstanding, life | 7 years 5 months 27 days | 8 years 1 month 6 days |
Vested and expected to vest, life | 7 years 5 months 27 days | |
Exercisable, life | 6 years 10 months 28 days | |
Total Aggregate Intrinsic Value | ||
Outstanding | $ 1,236 | $ 2,264 |
Vested and expected to vest | 1,236 | |
Exercisable | $ 914 |
STOCK INCENTIVE PLANS - Schedul
STOCK INCENTIVE PLANS - Schedule of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total | $ 1,285 | $ 1,555 | $ 4,346 | $ 4,206 |
Research and development | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total | 623 | 666 | 1,992 | 1,805 |
General and administrative | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total | $ 662 | $ 889 | $ 2,354 | $ 2,401 |
STOCK INCENTIVE PLANS - Summa_3
STOCK INCENTIVE PLANS - Summary of Common Stock Warrant Activity (Details) - Common stock warrants - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Warrants | ||
Outstanding at beginning of period (in shares) | 17,331 | |
Issued (in shares) | 12,499,997 | |
Exercised (in shares) | 0 | |
Canceled (in shares) | 0 | |
Outstanding at ending of period (in shares) | 12,517,328 | |
Weighted Average Exercise Price | ||
Outstanding at beginning of period (in dollars per share) | $ 11.54 | |
Issued (in dollars per share) | 6.81 | |
Exercised (in dollars per share) | 0 | |
Canceled (in dollars per share) | 0 | |
Outstanding at ending of period (in dollars per share) | $ 6.82 | |
Total Intrinsic Value | $ 0 | $ 0 |
SIGNIFICANT AGREEMENTS AND CO_2
SIGNIFICANT AGREEMENTS AND CONTRACTS (Details) - Collaborative agreement - USD ($) | Mar. 30, 2017 | May 31, 2018 | Sep. 30, 2018 |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||
Duration of partnership grant | 5 years | ||
Partnership grant | $ 5,500,000 | ||
CD201 product candidate | |||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||
Qualifying development expenses to be reimbursed by CARB-X upon acceptance of new initial drug application | $ 3,900,000 | ||
Qualifying development expenses to be reimbursed through a Phase 1 clinical trial of CD201 | $ 3,000,000 | ||
Billed accounts receivable | $ 0 | ||
Unbilled accounts receivable | $ 0 | ||
Agreement termination, written notice period | 30 days |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Narrative (Details) | Jan. 01, 2019USD ($) | Sep. 30, 2018USD ($)optionclaim1 | Sep. 30, 2017USD ($) |
Loss Contingencies [Line Items] | |||
Number of claim or actions pending | claim1 | 0 | ||
Number of options for individual two-year extensions | option | 2 | ||
Term of optional individual extensions | 2 years | ||
Annual increases in base rent (as a percent) | 3.00% | ||
Rent expense | $ 568,000 | $ 530,000 | |
Contract termination, notice period | 30 days | ||
Forecast | |||
Loss Contingencies [Line Items] | |||
Base rent following amendment | $ 70,000 | ||
Term of optional individual extensions | 36 months |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Schedule of Future Minimum Payments Required (Details) $ in Thousands | Sep. 30, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,018 | $ 189 |
2,019 | 836 |
2,020 | 861 |
2,021 | 887 |
Total minimum lease payments | $ 2,773 |