Alpine Immune Sciences (ALPN) 10-Q 3 Nov 15 2015 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2015	Oct. 31, 2015
Document and Entity Information
Entity Registrant Name	Nivalis Therapeutics, Inc.
Entity Central Index Key	1,626,199
Document Type	10-Q
Document Period End Date	Sep. 30, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		15,451,821
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q3

Balance Sheets

Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 57,555	$ 27,812
Marketable securities	35,096
Prepaid expenses and other current assets	996	630
Total current assets	93,647	28,442
Property and equipment and other assets, net	195	101
Total assets	93,842	28,543
Current liabilities:
Accounts payable	1,552	929
Accrued direct program expenses	1,457	1,244
Accrued employee benefits	1,336	210
Accrued other liabilities	120	32
Total current liabilities	$ 4,465	$ 2,415
Commitments and contingencies
Convertible preferred stock with liquidation preference; $0.001 par value; zero and 23,228,986 shares authorized, respectively; zero and 19,978,986 shares issued and outstanding, respectively		$ 41,880
Preferred stock, $0.001 par value; 10,000,000 and zero shares authorized, respectively; no shares issued and outstanding
Common stock, $0.001 par value; 20,000,000 and 35,000,000 shares authorized, respectively; 15,451,121 and 2,211,158 shares issued and outstanding, respectively	$ 15	$ 2
Additional paid-in capital	231,621	110,265
Accumulated other comprehensive income	15
Accumulated deficit	(142,274)	(126,019)
Total stockholders' deficit	89,377	(15,752)
Total liabilities and stockholders' deficit	$ 93,842	$ 28,543

Balance Sheets (Parenthetical)

Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2015	Dec. 31, 2014
Balance Sheets
Convertible preferred stock with liquidation preference, par value (in dollars per share)		$ 0.001
Convertible preferred stock with liquidation preference, shares authorized	0	23,228,986
Convertible preferred stock with liquidation preference, shares issued	0	19,978,986
Convertible preferred stock with liquidation preference, shares outstanding	0	19,978,986
Preferred stock, par value (in dollars per share)	$ 0.001
Preferred stock, shares authorized	10,000,000	0
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	200,000,000	35,000,000
Common stock, shares issued	15,451,821	2,211,158
Common stock, shares outstanding	15,451,821	2,211,158

Statements of Operations and Co

Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Statements of Operations and Comprehensive Loss
Revenue			$ 0
Operating expenses:
Research and development	$ 4,279	$ 2,164	11,761	$ 9,378
General and administrative	1,822	490	4,507	1,623
Loss from operations	(6,101)	(2,654)	(16,268)	(11,001)
Other income, net	12	35	13	296
Interest expense		(392)		(845)
Net loss	(6,089)	(3,011)	(16,255)	(11,550)
Gain on extinguishment of convertible debt as a capital transaction		378		378
Net loss attributable to common stockholders	(6,089)	(2,633)	(16,255)	(11,172)
Change in unrealized gains (losses) on marketable securities	15		15
Comprehensive loss	$ (6,074)	$ (2,633)	$ (16,240)	$ (11,172)
Weighted average shares outstanding—basic and diluted	15,451	343	7,322	223
Net loss per share attributable to common stockholders—basic and diluted	$ (0.39)	$ (7.68)	$ (2.22)	$ (50.10)

Statement of Convertible Prefer

Statement of Convertible Preferred Stock and Stockholders' Equity (Deficit) - 9 months ended Sep. 30, 2015 - USD ($) shares in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income	Accumulated Deficit	Series 1 Convertible Preferred Stock	Series 2 Convertible Preferred Stock	Total
Balance, beginning at Dec. 31, 2014	$ 2,000	$ 110,265,000		$ (126,019,000)	$ 11,945,000	$ 29,935,000	$ (15,752,000)
Balance, beginning (in shares) at Dec. 31, 2014	2,211				8,813	11,166
Conversion of convertible preferred stock to common stock	$ 7,000	41,873,000			$ (11,945,000)	$ (29,935,000)	41,880,000
Conversion of convertible preferred stock to common stock (in shares)	6,916				(8,813)	(11,166)
Issuance of common stock, net of offering costs	$ 6,000	78,765,000					78,771,000
Issuance of common stock, net of offering costs (in shares)	6,325
Employee stock-based compensation expense		718,000					718,000
Change in unrealized gains (losses) on marketable securities			$ 15				15,000
Net loss				(16,255,000)			(16,255,000)
Balance, ending at Sep. 30, 2015	$ 15,000	$ 231,621,000	$ 15	$ (142,274,000)			$ 89,377,000
Balance, ending (in shares) at Sep. 30, 2015	15,452

Statement of Convertible Prefe6

Statement of Convertible Preferred Stock and Stockholders' Equity (Deficit) (Parenthetical) - USD ($) $ in Millions	Jun. 22, 2015	Sep. 30, 2015
Statement of Convertible Preferred Stock and Stockholders' Equity (Deficit)
Issuance of common stock offering costs	$ 9.8	$ 9.8

Statements of Cash Flows

Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Operating activities
Net loss	$ (16,255)	$ (11,550)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	47	70
Loss on disposal of assets		2
Stock-based compensation expense	718	57
Change in value of preferred stock warrant liabilities and derivative		(296)
Amortization of deferred financing costs and noncash interest		708
Changes in operating assets and liabilities:
Prepaid expenses and other	(366)	25
Accounts payable	623	(304)
Accrued direct program expenses	213	146
Accrued employee benefits	1,126	(192)
Accrued other liabilities	88	55
Net cash used in operating activities	(13,806)	(11,279)
Investing activities
Purchases of property and equipment	(142)	(4)
Purchases of marketable securities	(35,081)
Net cash used in investing activities	(35,223)	(4)
Financing activities
Proceeds from issuance of common stock, net of offering costs	78,772
Decrease in restricted cash		2,500
Proceeds from notes payable, net		11,913
Principal payment on debt		(3,140)
Net cash provided by financing activities	78,772	11,273
Net increase (decrease) in cash and cash equivalents	29,743	(10)
Cash and cash equivalents, beginning of period	27,812	1,098
Cash and cash equivalents, end of period	57,555	1,088
Supplemental disclosures of cash flow information
Cash paid for interest		165
Conversion of convertible preferred stock to common stock	41,880
Conversion of convertible debt and accrued interest to convertible preferred stock, net		$ 24,700
Unrealized gains on marketable securities available-for-sale	$ 15

Organization and Description of

Organization and Description of Business	9 Months Ended
	Sep. 30, 2015
Organization and Description of Business
Organization and Description of Business	1. Organization and Description of Business Nivalis Therapeutics, Inc., formerly N30 Pharmaceuticals, Inc. (the ‘‘Company’’ or ‘‘Nivalis’’) is a clinical stage pharmaceutical company committed to the discovery, development and commercialization of therapeutics for people with cystic fibrosis. In addition to developing innovative solutions intended to extend and improve the lives of people with cystic fibrosis, Nivalis plans to utilize its proprietary S-nitrosoglutathione reductase (GSNOR) inhibitor portfolio to develop therapeutics for other diseases. The Company was incorporated on August 1, 2012, under the laws of the State of Delaware, upon the conversion of its predecessor entity N30 Pharmaceuticals, LLC (‘‘N30 LLC’’), from a Delaware limited liability company to a Delaware Corporation (the ‘‘Company Conversion’’). On February 11, 2015, the Company changed its name to Nivalis Therapeutics, Inc.

Liquidity Risks

Liquidity Risks	9 Months Ended
	Sep. 30, 2015
Uncertainties [Abstract]
Liquidity Risks	2. Liquidity Risks The Company has incurred operating losses and has an accumulated deficit as a result of ongoing research and development spending. As of September 30, 2015, the Company had an accumulated deficit of $142. 3 million. Net losses and net cash used in operating activities for the nine months ended September 30, 2015 were $16. 3 million and $13. 8 million, respectively. The Company anticipates that operating losses and net cash used in operating activities will continue and substantially increase over the next several years as it expands development activities for its N91115 product candidate. The Company has historically financed its operations primarily through the sale of its equity securities and debt offerings. The Company will continue to be dependent upon such sources of funds until it is able to generate positive cash flows from its operations. Management has determined that the Company’s existing cash, cash equivalents and marketable securities as of September 30, 2015 will be sufficient to fund operations at least through the next twelve months. The Company expects to fund future operations through the sale of its equity securities, incurring debt, entering into partnerships, or obtaining grants or other nondilutive sources of financing. There can be no assurance that sufficient funds from these sources will be available to the Company when needed or at all or on terms that are favorable to the Company. If the Company is unable to obtain additional funding from these or other sources when needed, or to the extent needed, it would have a negative impact on the Company’s financial condition and its ability to pursue its business strategy. It could force the Company to delay, limit, reduce or terminate research and development programs and commercialization efforts or cause the Company to cease operations in full.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2015
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	3. Summary of Significant Accounting Policies Basis of Presentation and Use of Estimates The financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and include all adjustments necessary for the presentation of the Company’s financial position, results of operations and cash flows for the periods presented. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements and accompanying notes, including accrued liabilities and the fair value-based measurement of equity instruments. Actual results could differ materially from those estimates. The Company evaluates its estimates and assumptions as facts and circumstances dictate. Unaudited Interim Financial Data The balance sheet at December 31, 2014 was derived from audited financial statements, but does not include all the disclosures required by U.S. GAAP. The accompanying interim financial statements as of September 30, 2015 and for the three and nine months ended September 30, 2015 and 2014, are unaudited. The unaudited interim financial statements have been prepared on a basis consistent with the audited financial statements, pursuant to the rules and regulations of the SEC for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. These financial statements should be read in conjunction with the Company’s audited financial statements and the notes thereto for the year ended December 31, 2014. In the opinion of management, the financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary to fairly state the Company’s financial position as of September 30, 2015 and the results of operations and cash flows for the three and nine months ended September 30, 2015 and 2014. The results for the three and nine months ended September 30, 2015 are not necessarily indicative of the results to be expected for the year ending December 31, 2015 or for any future interim period. 2014 Stock Conversion and Reverse Stock Split Effective September 23, 2014, all outstanding shares of preferred stock were converted on an 11.556 -for-1 basis into shares of common stock (the ‘‘Stock Conversion’’). Concurrent with this conversion, the Company e ffected a reverse stock split of its common stock, par value $0.001 per share. Every four shares of common stock were reclassified and combined into one share of common stock. Fractional shares were issued as a result of the reverse stock split. The total number of authorized shares of common stock was also proportionally decreased by a ratio of 1:4 and the par value per share of the common stock continued to be $0.001. 2015 Stock Conversion and Reverse Stock Split On May 26, 2015, the Company’s Board of Directors approved a 1- for-2.889 reverse stock split of its common stock. The reverse stock split became effective upon filing of a certificate of amendment to the Company’s amended and restated certificate of incorporation on June 1, 2015. Upon the effectiveness of the reverse stock split, (i) every 2.889 shares of outstanding common stock were decreased to one share of common stock, (ii) the number of shares of common stock into which each outstanding option, right and warrant to purchase common stock is exercisable was proportionally decreased on a 1-for-2.889 basis and the exercise price of each outstanding option, right and warrant to purchase common stock was proportionately increased on a 1-for-2.889 basis, and (iii) the conversion ratio for each share of the Company’s convertible preferred stock which was convertible into common stock was proportionally decreased on a corresponding basis in connection with the 1-for-2.889 reverse split. No fractional shares were issued as a result of the reverse stock split. The total number of authorized shares of common stock and the par value per share of common stock did not change as a result of the reverse stock split. Effective June 22, 2015, all outstanding shares of convertible preferred stock were converted on a 2.889-for-1 basis into shares of common stock. All of the share numbers, share prices, exercise prices and other per share information throughout these financial statements for all periods presented have been adjusted, on a retroactive basis, to reflect the 1-for-4 reverse stock split and the 1-for-2.889 reverse stock split. Comprehensive Loss Comprehensive loss is comprised of net loss and adjustments for the change in unrealized gains and losses on the Company’s investments in available-for-sale marketable securities. The Company presents comprehensive loss and its components in the statements of operations and comprehensive loss for the three and nine months ended September 30, 2015. Net Loss per Share The Company reports net loss per share in accordance with the standard codification of ASC “Earnings per Share” (“ASC 260”). Under ASC 260, basic earnings per share, which excludes dilution, is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution of securities that could be exercised or converted into common shares, and is computed by dividing net loss available to common stockholders by the weighted average of common shares outstanding plus the dilutive potential common shares. Diluted earnings per share excludes the impact of convertible preferred stock, employee stock options, restricted stock and stock purchase rights, as the effect would be anti-dilutive. During a loss period, the assumed exercise of in-the-money stock options and other potentially diluted instruments has an anti-dilutive effect and therefore, these instruments are excluded from the computation of dilutive earnings per share. Fair Value of Financial Instruments The carrying amounts of cash equivalents and marketable securities approximate their fair value based upon quoted market prices. Certain financial instruments are not measured at fair value on a recurring basis, but are recorded at amounts that approximate their fair value due to their liquid or short-term nature, such as cash, accounts payable, accrued direct program expenses, and accrued employee benefits , and other financial instruments included within current assets or current liabilities. The Company accounted for warrants to purchase its redeemable preferred stock pursuant to ASC Topic 480, Distinguishing Liabilities from Equity , and classified them as liabilities. The fair value of the outstanding preferred stock warrant liabilities at December 31, 2013 was $267,750 . Subsequent to the completion of the Stock Conversion on September 23, 2014, whereby all outstanding shares of preferred stock were converted into shares of common stock, the fair value of the preferred stock warrant liabilities was remeasured and reclassified into equity. During the three and nine months ended September 30, 2014 a remeasurement gain of $4,000 and $265,750 , respectively, was recognized in other income, net in the statement of operations and comprehensive loss. Upon the Stock Conversion, the remaining balance of $2,000 was reclassified from liabilities to equity. Marketable Securities The Company has designated marketable securities as available-for-sale securities and accounts for them at their respective fair values. Marketable securities are classified as short-term or long-term based on the nature of the securities and their availability to meet current operating requirements. Securities that are classified as available-for-sale are carried at fair value, including accrued interest, with temporary unrealized gains and losses reported as a component of stockholders' equity (deficit) until their disposition. The Company reviews all available-for-sale securities at each period end to determine if they remain available-for-sale based on the Company’s then current intent and ability to sell the security if it is required to do so. The cost of securities sold is based on the specific identification method. All marketable securities are subject to a periodic impairment review. The Company will recognize an impairment charge when a decline in the fair value of the investments below the cost basis is judged to be other-than-temporary. Recent Accounting Pronouncements In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements – Going Concern Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern, which requires management to evaluate whether there are conditions or events that raise substantial doubt about an entity’s ability to continue as a going concern and to provide disclosures when certain criteria are met. The guidance is effective for annual periods beginning in 2016 and interim reporting periods starting in the first quarter of 2017. Early application is permitted. The Company does not expect the standard will have a material impact on its disclosures. Fair Value Measurements In general, asset and liability fair values are determined using the following categories: Level 1 – inputs utilize quoted prices in active markets for identical assets or liabilities. Level 2 – inputs include quoted prices for similar assets or liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. Level 3 – inputs are unobservable inputs and include situations where there is little, if any, market activity for the balance sheet items at period end. Pricing inputs are unobservable for the terms and are based on the Company’s own estimates about the assumptions that a market participant would use in pricing as asset. The Company’s financial instruments, including money market investments, corporate debt securities, and obligations of U.S. government agencies, are measured at fair value on a recurring basis. There were no transfers between levels for the nine months ended September 30, 2015. Assets and liabilities measured at fair value on a recurring basis consisted of the following types of instruments as of September 30, 2015 and December 31, 2014 (in thousands): Quoted prices Quoted prices Quoted prices in active for similar assets in active markets for observable in the markets for September 30, identical assets marketplace December 31, identical assets Description 2015 (Level 1) (Level 2) 2014 (Level 1) Assets measured at fair value: Money market investments $ $ $ — $ $ Obligations of U.S. government agencies and corporate debt securities — — —

Cash, Cash Equivalents and Mark

Cash, Cash Equivalents and Marketable Securities	9 Months Ended
	Sep. 30, 2015
Cash, Cash Equivalents and Marketable Securities
Cash, Cash Equivalents and Marketable Securities	4. Cash, Cash Equivalents and Marketable Securities The following is a summary of cash, cash equivalents and marketable securities as of September 30, 2015 and December 31, 2014 (in thousands): Gross unrealized Gross unrealized Fair market Amortized Cost gains losses value September 30, 2015 Cash $ $ - $ - $ Money market funds - - Obligations of U.S. government agencies - Corporate debt securities Total for September 30, 2015 $ $ $ $ December 31, 2014 Cash $ $ – $ – $ Money market funds – – Total for December 31, 2014 $ $ – $ – $

Notes Payable

Notes Payable	9 Months Ended
	Sep. 30, 2015
Notes Payable
Notes Payable	5. Notes Payable As of September 30, 2015, the Company has no debt outstanding. Loan and Security Agreement During February 2011, the Company entered into a $5.0 million loan and security agreement (“Loan Agreement”) with Horizon Technology Finance (“Horizon”). The interest rate for these loans was 11.25% . The Loan Agreement required that the Company maintain $2.5 million in an account that was subject to an Account Control Agreement and restricted the Company from withdrawing the funds from this account without Horizon’s prior written consent. During July 2014, the entire outstanding balance under the Loan Agreement was paid in full and the remaining restricted cash held by the Company was fully released. The payment also released all previously pledged assets held as collateral under the loan. Convertible Debt During February, March, April, June, July, August and September 2014 (the “2014 Notes”), the Company issued subordinated secured convertible debt to two investors totaling $12.0 million at an interest rate of 8.0% per annum. The outstanding principal and accrued and unpaid interest was convertible at the option of the investor into preferred shares in the Company. The 2014 Notes included a change in control redemption which was deemed an embedded derivative. This redemption right and the right to convert at 75% of the price at which a new series of preferred stock was issued required the Company to bifurcate and separately account for the embedded derivatives, however the amount recorded and the impact on net loss was not material. As part of the Stock Conversion on September 23, 2014, the holders of the 2014 Notes agreed to the issuance of shares of a newly created Series 1 convertible preferred stock in settlement of the 2014 Notes. The Company issued 8,813,203 Series 1 convertible preferred shares at a price of $1.40 per share through the settlement of $12,373,741 of convertible debt and related interest held by two separate investors. This transaction resulted in a gain on extinguishment of $378,251 , which was recognized through equity during the three months ended September 30, 2014, as this was a transaction with stockholders.

Stockholders' Equity

Stockholders' Equity	9 Months Ended
	Sep. 30, 2015
Stockholders' Equity
Stockholders' Equity	6. Stockholders’ Equity During February 2014, the Company increased its authorized number of shares of convertible preferred stock to 30,233,694 shares. During March 2014, the Company increased its authorized number of shares of convertible preferred stock to 60,503,445 shares and increased its authorized number of shares of common stock to 25,000,000 shares. Immediately following the Stock Conversion and the one-for- four reverse stock split effected in September 2014, the Company reestablished its authorized number of shares of convertible preferred stock to 8,866,753 shares and its authorized number of shares of common stock to 15,742,382 shares. During November 2014, the Company increased its authorized number of shares of convertible preferred stock to 23,228,986 shares and increased its authorized number of shares of common stock to 35,000,000 shares. Concurrent with the Company’s initial public offering completed in June 2015 (the “IPO”), the Company increased its authorized number of shares of common stock to 2 00 , 000 , 000 shares , eliminated its authorized shares of convertible preferred s tock and authorized 10 ,000,000 shares of preferred stock for future issuance . Convertible Preferred Stock Immediately prior to the Stock Conversion, the Company had six series of outstanding convertible preferred stock: Series A-1 convertible preferred stock, Series A-2 convertible preferred stock, Series C-1 convertible preferred stock, Series C-2 convertible preferred stock, Series D convertible preferred stock and Series E convertible preferred stock. The convertible preferred stock was initially recorded at the issuance price on the date of issuance, net of issuance costs. On September 23, 2014 all outstanding preferred stock was converted into shares of common stock on an 11.556 -for-1 basis. Concurrent with the Stock Conversion, a newly created Series 1 convertible preferred stock was issued in the settlement of the 2014 Notes. In November and December 2014, the Company raised $31.0 million gross proceeds in a private placement of Series 2 convertible preferred stock . On June 22, 2015, prior to the closing of the Company’s IPO, all outstanding shares of convertible preferred stock, amounting to 19,978,986 shares, were automatically converted into 6,915,525 shares of common stock in accordance with the terms of the Company’s amended and restated certificate of incorporation then in existence. As of September 30, 2015, the Company had no preferred stock or convertible preferred stock outstanding . Common Stock On June 22, 2015, the Company completed its IPO of 6,325,000 shares of its common stock, including 875,000 shares from the exercise of the underwriters’ over-allotment option. The Company received proceeds of $78.8 million from its IPO, net of $9.8 million in expenses and underwriters’ discounts and commissions relating to the issuance and distribution of the securities. At September 30, 2015, shares of common stock have been reserved for issuance as follows (in thousands): Options to purchase common stock - issued Options to purchase common stock - unissued Employee stock purchase plan Common stock warrants

Net Loss per Share

Net Loss per Share	9 Months Ended
	Sep. 30, 2015
Net Loss per Share
Net Loss per Share	7. Net Loss per Share The Company excluded the following common stock equivalents, outstanding as of the three and nine months ended September 30, 2015 and 2014, from the computation of diluted net loss per share for these same periods because they had an anti-dilutive impact on the computation (in thousands): September 30, 2015 2014 Options to purchase common stock - issued Unvested restricted common stock Convertible preferred stock — Warrants to purchase convertible preferred and common stock Total

Subsequent Events

Subsequent Events	9 Months Ended
	Sep. 30, 2015
Subsequent Events
Subsequent Events	8. Subsequent Events The Company has evaluated events up to the filing date of these interim financial statements and determined that no subsequent event activity required disclosure.

Summary of Significant Accoun16

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2015
Summary of Significant Accounting Policies
Basis of Presentation and Use of Estimates	Basis of Presentation and Use of Estimates The financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and include all adjustments necessary for the presentation of the Company’s financial position, results of operations and cash flows for the periods presented. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements and accompanying notes, including accrued liabilities and the fair value-based measurement of equity instruments. Actual results could differ materially from those estimates. The Company evaluates its estimates and assumptions as facts and circumstances dictate.
Unaudited Interim Financial Data	Unaudited Interim Financial Data The balance sheet at December 31, 2014 was derived from audited financial statements, but does not include all the disclosures required by U.S. GAAP. The accompanying interim financial statements as of September 30, 2015 and for the three and nine months ended September 30, 2015 and 2014, are unaudited. The unaudited interim financial statements have been prepared on a basis consistent with the audited financial statements, pursuant to the rules and regulations of the SEC for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. These financial statements should be read in conjunction with the Company’s audited financial statements and the notes thereto for the year ended December 31, 2014. In the opinion of management, the financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary to fairly state the Company’s financial position as of September 30, 2015 and the results of operations and cash flows for the three and nine months ended September 30, 2015 and 2014. The results for the three and nine months ended September 30, 2015 are not necessarily indicative of the results to be expected for the year ending December 31, 2015 or for any future interim period.
Stock Conversion and Reverse Stock Split	2014 Stock Conversion and Reverse Stock Split Effective September 23, 2014, all outstanding shares of preferred stock were converted on an 11.556 -for-1 basis into shares of common stock (the ‘‘Stock Conversion’’). Concurrent with this conversion, the Company e ffected a reverse stock split of its common stock, par value $0.001 per share. Every four shares of common stock were reclassified and combined into one share of common stock. Fractional shares were issued as a result of the reverse stock split. The total number of authorized shares of common stock was also proportionally decreased by a ratio of 1:4 and the par value per share of the common stock continued to be $0.001. 2015 Stock Conversion and Reverse Stock Split On May 26, 2015, the Company’s Board of Directors approved a 1- for-2.889 reverse stock split of its common stock. The reverse stock split became effective upon filing of a certificate of amendment to the Company’s amended and restated certificate of incorporation on June 1, 2015. Upon the effectiveness of the reverse stock split, (i) every 2.889 shares of outstanding common stock were decreased to one share of common stock, (ii) the number of shares of common stock into which each outstanding option, right and warrant to purchase common stock is exercisable was proportionally decreased on a 1-for-2.889 basis and the exercise price of each outstanding option, right and warrant to purchase common stock was proportionately increased on a 1-for-2.889 basis, and (iii) the conversion ratio for each share of the Company’s convertible preferred stock which was convertible into common stock was proportionally decreased on a corresponding basis in connection with the 1-for-2.889 reverse split. No fractional shares were issued as a result of the reverse stock split. The total number of authorized shares of common stock and the par value per share of common stock did not change as a result of the reverse stock split. Effective June 22, 2015, all outstanding shares of convertible preferred stock were converted on a 2.889-for-1 basis into shares of common stock. All of the share numbers, share prices, exercise prices and other per share information throughout these financial statements for all periods presented have been adjusted, on a retroactive basis, to reflect the 1-for-4 reverse stock split and the 1-for-2.889 reverse stock split.
Comprehensive Loss	Comprehensive Loss Comprehensive loss is comprised of net loss and adjustments for the change in unrealized gains and losses on the Company’s investments in available-for-sale marketable securities. The Company presents comprehensive loss and its components in the statements of operations and comprehensive loss for the three and nine months ended September 30, 2015.
Net Loss per Share	Net Loss per Share The Company reports net loss per share in accordance with the standard codification of ASC “Earnings per Share” (“ASC 260”). Under ASC 260, basic earnings per share, which excludes dilution, is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution of securities that could be exercised or converted into common shares, and is computed by dividing net loss available to common stockholders by the weighted average of common shares outstanding plus the dilutive potential common shares. Diluted earnings per share excludes the impact of convertible preferred stock, employee stock options, restricted stock and stock purchase rights, as the effect would be anti-dilutive. During a loss period, the assumed exercise of in-the-money stock options and other potentially diluted instruments has an anti-dilutive effect and therefore, these instruments are excluded from the computation of dilutive earnings per share.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The carrying amounts of cash equivalents and marketable securities approximate their fair value based upon quoted market prices. Certain financial instruments are not measured at fair value on a recurring basis, but are recorded at amounts that approximate their fair value due to their liquid or short-term nature, such as cash, accounts payable, accrued direct program expenses, and accrued employee benefits , and other financial instruments included within current assets or current liabilities. The Company accounted for warrants to purchase its redeemable preferred stock pursuant to ASC Topic 480, Distinguishing Liabilities from Equity , and classified them as liabilities. The fair value of the outstanding preferred stock warrant liabilities at December 31, 2013 was $267,750 . Subsequent to the completion of the Stock Conversion on September 23, 2014, whereby all outstanding shares of preferred stock were converted into shares of common stock, the fair value of the preferred stock warrant liabilities was remeasured and reclassified into equity. During the three and nine months ended September 30, 2014 a remeasurement gain of $4,000 and $265,750 , respectively, was recognized in other income, net in the statement of operations and comprehensive loss. Upon the Stock Conversion, the remaining balance of $2,000 was reclassified from liabilities to equity.
Marketable Securities	Marketable Securities The Company has designated marketable securities as available-for-sale securities and accounts for them at their respective fair values. Marketable securities are classified as short-term or long-term based on the nature of the securities and their availability to meet current operating requirements. Securities that are classified as available-for-sale are carried at fair value, including accrued interest, with temporary unrealized gains and losses reported as a component of stockholders' equity (deficit) until their disposition. The Company reviews all available-for-sale securities at each period end to determine if they remain available-for-sale based on the Company’s then current intent and ability to sell the security if it is required to do so. The cost of securities sold is based on the specific identification method. All marketable securities are subject to a periodic impairment review. The Company will recognize an impairment charge when a decline in the fair value of the investments below the cost basis is judged to be other-than-temporary.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements – Going Concern Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern, which requires management to evaluate whether there are conditions or events that raise substantial doubt about an entity’s ability to continue as a going concern and to provide disclosures when certain criteria are met. The guidance is effective for annual periods beginning in 2016 and interim reporting periods starting in the first quarter of 2017. Early application is permitted. The Company does not expect the standard will have a material impact on its disclosures.
Fair Value Measurements	Fair Value Measurements In general, asset and liability fair values are determined using the following categories: Level 1 – inputs utilize quoted prices in active markets for identical assets or liabilities. Level 2 – inputs include quoted prices for similar assets or liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. Level 3 – inputs are unobservable inputs and include situations where there is little, if any, market activity for the balance sheet items at period end. Pricing inputs are unobservable for the terms and are based on the Company’s own estimates about the assumptions that a market participant would use in pricing as asset. The Company’s financial instruments, including money market investments, corporate debt securities, and obligations of U.S. government agencies, are measured at fair value on a recurring basis. There were no transfers between levels for the nine months ended September 30, 2015. Assets and liabilities measured at fair value on a recurring basis consisted of the following types of instruments as of September 30, 2015 and December 31, 2014 (in thousands): Quoted prices Quoted prices Quoted prices in active for similar assets in active markets for observable in the markets for September 30, identical assets marketplace December 31, identical assets Description 2015 (Level 1) (Level 2) 2014 (Level 1) Assets measured at fair value: Money market investments $ $ $ — $ $ Obligations of U.S. government agencies and corporate debt securities — — —

Summary of Significant Accoun17

Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2015
Summary of Significant Accounting Policies
Schedule of assets measured at fair value on a recurring basis (in thousands)	Quoted prices Quoted prices Quoted prices in active for similar assets in active markets for observable in the markets for September 30, identical assets marketplace December 31, identical assets Description 2015 (Level 1) (Level 2) 2014 (Level 1) Assets measured at fair value: Money market investments $ $ $ — $ $ Obligations of U.S. government agencies and corporate debt securities — — —

Cash, Cash Equivalents and Ma18

Cash, Cash Equivalents and Marketable Securities (Tables)	9 Months Ended
	Sep. 30, 2015
Cash, Cash Equivalents and Marketable Securities
Schedule of cash, cash equivalents and marketable securities (in thousands)	Gross unrealized Gross unrealized Fair market Amortized Cost gains losses value September 30, 2015 Cash $ $ - $ - $ Money market funds - - Obligations of U.S. government agencies - Corporate debt securities Total for September 30, 2015 $ $ $ $ December 31, 2014 Cash $ $ – $ – $ Money market funds – – Total for December 31, 2014 $ $ – $ – $

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)	9 Months Ended
	Sep. 30, 2015
Stockholders' Equity
Schedule of common stock reserved for issuance (in thousands)	Options to purchase common stock - issued Options to purchase common stock - unissued Employee stock purchase plan Common stock warrants

Net Loss per Share (Tables)

Net Loss per Share (Tables)	9 Months Ended
	Sep. 30, 2015
Net Loss per Share
Schedule of anti-dilutive common stock equivalents (in thousands)	September 30, 2015 2014 Options to purchase common stock - issued Unvested restricted common stock Convertible preferred stock — Warrants to purchase convertible preferred and common stock Total

Liquidity Risks (Details)

Liquidity Risks (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Uncertainties [Abstract]
Accumulated deficit	$ (142,274)		$ (142,274)		$ (126,019)
Net loss	$ (6,074)	$ (2,633)	(16,240)	$ (11,172)
Cash used in operating activities			(13,806)	$ (11,279)
Revenue			$ 0

Summary of Significant Accoun22

Summary of Significant Accounting Policies (Details)	May. 26, 2015	Sep. 23, 2014$ / shares	Sep. 30, 2015$ / shares	Dec. 31, 2014$ / shares
Summary of Significant Accounting Policies
Preferred stock conversion ratio		11.556
Common stock, par value (in dollars per share)		$ 0.001	$ 0.001	$ 0.001
Stock split conversion ratio	0.3461	0.25

Summary of Significant Accoun23

Summary of Significant Accounting Policies (FV) (Details) - USD ($)	Sep. 23, 2014	Sep. 30, 2014	Sep. 30, 2014	Sep. 30, 2015	Dec. 31, 2014	Dec. 31, 2013
Assets measured at fair value:
Fair market value				$ 92,651,000	$ 27,812,000
Preferred stock warrant liabilities
Fair Value Measurements
Warrant fair value						$ 267,750
Remeasurement gain		$ 4,000	$ 265,750
Reclass from liability to equity	$ 2,000
Money market funds
Assets measured at fair value:
Fair market value				16,305,000	26,926,000
Money market funds | Recurring
Assets measured at fair value:
Fair market value				16,305,000	26,926,000
Money market funds | Recurring | Level 1
Assets measured at fair value:
Fair market value				16,305,000	$ 26,926,000
U.S. government agencies and corporate debt securities | Recurring
Assets measured at fair value:
Fair market value				75,248,000
U.S. government agencies and corporate debt securities | Recurring | Level 2
Assets measured at fair value:
Fair market value				$ 75,248,000

Cash, Cash Equivalents and Ma24

Cash, Cash Equivalents and Marketable Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Summary of cash, cash equivalents and marketable securities
Amortized Cost	$ 92,636	$ 27,812
Gross unrealized gains	19
Gross unrealized losses	(4)
Fair market value	92,651	27,812
Cash
Summary of cash, cash equivalents and marketable securities
Amortized Cost	1,098	886
Fair market value	1,098	886
Money market funds
Summary of cash, cash equivalents and marketable securities
Amortized Cost	16,305	26,926
Fair market value	16,305	$ 26,926
Obligations of U.S. government agencies
Summary of cash, cash equivalents and marketable securities
Amortized Cost	22,094
Gross unrealized gains	3
Fair market value	22,097
Corporate debt securities
Summary of cash, cash equivalents and marketable securities
Amortized Cost	53,139
Gross unrealized gains	16
Gross unrealized losses	(4)
Fair market value	$ 53,151

Notes Payable (Details)

Notes Payable (Details)	May. 26, 2015	Sep. 23, 2014USD ($)security$ / shares	Sep. 30, 2014USD ($)item	Sep. 30, 2014USD ($)	Sep. 30, 2015USD ($)	Feb. 28, 2011USD ($)
Notes Payable
Debt outstanding					$ 0
Access to restricted cash				$ 2,500,000
Stock split conversion ratio	0.3461	0.25
Security Agreement
Notes Payable
Debt issued						$ 5,000,000
Interest rate (as a percent)						11.25%
Restricted proceeds						$ 2,500,000
2014 Notes
Notes Payable
Debt issued			$ 12,000,000	$ 12,000,000
Interest rate (as a percent)			8.00%	8.00%
Number of investors | item			2
Percentage of new series conversion price			75.00%
Debt and related interest		$ 12,373,741
Gain on extinguishment recognized through equity		$ 378,251
2014 Notes | Preferred Stock | Series 1 Convertible Preferred Stock
Notes Payable
Conversion price (in dollars per share) | $ / shares		$ 1.40
Conversion of debt to preferred stock (in shares) | security		8,813,203

Stockholders' Equity (Details)

Stockholders' Equity (Details) $ in Millions	Jun. 22, 2015USD ($)shares	May. 26, 2015	Sep. 23, 2014shares	Dec. 31, 2014USD ($)shares	Sep. 30, 2015USD ($)shares	Dec. 31, 2013item	Jun. 30, 2015shares	Nov. 30, 2014shares	Mar. 31, 2014shares	Feb. 28, 2014shares
Stockholders' Equity
Authorized convertible preferred stock (in shares)				23,228,986	0
Common stock, shares authorized			15,742,382	35,000,000	200,000,000		200,000,000	35,000,000	25,000,000
Stock split conversion ratio		0.3461	0.25
Authorized preferred stock (in shares)				0	10,000,000		10,000,000
Preferred stock conversion ratio			11.556
Convertible preferred stock outstanding (in shares)				19,978,986	0
Stock issued upon conversion (in shares)	6,915,525
Preferred stock outstanding (in shares)				0	0
Proceeds from issuance of common stock, net of offering costs | $	$ 78.8
Issuance of common stock offering costs | $	$ 9.8				$ 9.8
IPO
Stockholders' Equity
Issuance of common stock, net of offering costs (in shares)	6,325,000
Underwriters' Over-Allotment Option
Stockholders' Equity
Issuance of common stock, net of offering costs (in shares)	875,000
Convertible preferred stock
Stockholders' Equity
Authorized convertible preferred stock (in shares)			8,866,753					23,228,986	60,503,445	30,233,694
Stock split conversion ratio			0.25
Number of series of outstanding stock | item						6
Preferred stock conversion ratio			11.556
Convertible preferred stock outstanding (in shares)	19,978,986				0
Series 2 Convertible Preferred Stock
Stockholders' Equity
Proceeds from issuance of convertible preferred stock | $				$ 31

Stockholders' Equity (Reserved)

Stockholders' Equity (Reserved) (Details) shares in Thousands	Sep. 30, 2015shares
Stockholders' Equity
Common stock reserved for future issuance	2,643
Options to purchase common stock - issued
Stockholders' Equity
Common stock reserved for future issuance	1,804
Options to purchase common stock - unissued
Stockholders' Equity
Common stock reserved for future issuance	588
Employee stock purchase plan
Stockholders' Equity
Common stock reserved for future issuance	232
Common stock warrants
Stockholders' Equity
Common stock reserved for future issuance	19

Net Loss per Share (Details)

Net Loss per Share (Details) - shares shares in Thousands	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Net Loss per Share
Antidilutive common stock equivalents	1,824	3,187
Options to purchase common stock - issued
Net Loss per Share
Antidilutive common stock equivalents	1,804	112
Unvested restricted common stock
Net Loss per Share
Antidilutive common stock equivalents	1	5
Convertible preferred stock
Net Loss per Share
Antidilutive common stock equivalents		3,051
Common stock warrants
Net Loss per Share
Antidilutive common stock equivalents	19	19