Axcella Health (AXLA) 10-Q 11 May 20 2020 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	Mar. 31, 2020	May 07, 2020
Cover [Abstract]
Document Type	10-Q
Document Period End Date	Mar. 31, 2020
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	001-38501
Entity Registrant Name	AXCELLA HEALTH INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	26-3321056
Entity Address, Address Line One	840 Memorial Drive
Entity Address, City or Town	Cambridge
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02139
City Area Code	857
Local Phone Number	320-2200
Title of 12(b) Security	Common Stock
Trading Symbol	AXLA
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		23,188,816
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Central Index Key	0001633070
Current Fiscal Year End Date	--12-31

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 75,522	$ 92,053
Prepaid expenses and other current assets	1,299	1,487
Total current assets	76,821	93,540
Property and equipment, net	477	608
Security deposits and other assets	284	211
Total assets	77,582	94,359
Current liabilities:
Accounts payable	1,711	1,998
Accrued expenses and other current liabilities	3,162	6,358
Current portion of long term debt	2,167	0
Total current liabilities	7,040	8,356
Long term debt, net of current portion and discount	22,820	24,897
Other liabilities	908	882
Total liabilities	30,768	34,135
Commitments and contingencies	0	0
Stockholders' equity:
Common stock, $0.001 par value; 150,000,000 shares authorized, 23,607,797 shares issued and 23,188,816 shares outstanding at both March 31, 2020 and December 31, 2019	24	24
Additional paid-in capital	277,885	276,286
Treasury stock, 418,981 shares at cost	0	0
Accumulated deficit	(231,095)	(216,086)
Total stockholders' equity	46,814	60,224
Total liabilities and stockholders' equity	$ 77,582	$ 94,359

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Mar. 31, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Common stock, par value (USD per share)	$ 0.001	$ 0.001
Common stock authorized (in shares)	150,000,000	150,000,000
Common stock issued (in shares)	23,607,797	23,607,797
Common stock outstanding (in shares)	23,188,816	23,188,816
Treasury stock at cost (in shares)	418,981	418,981

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Operating expenses:
Research and development	$ 10,335	$ 7,563
General and administrative	4,125	3,468
Total operating expenses	14,460	11,031
Loss from operations	(14,460)	(11,031)
Other income (expense):
Interest income	257	390
Other income (expense)	(4)	0
Change in fair value of preferred stock warrant liability	0	(51)
Interest expense	802	881
Total other income (expense), net	(549)	(542)
Net loss and comprehensive loss	$ (15,009)	$ (11,573)
Net loss per share, basic and diluted (USD per share)	$ (0.65)	$ (2.43)
Weighted average common shares outstanding, basic and diluted (in shares)	23,188,816	4,775,828

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash flows from operating activities:
Net loss	$ (15,009)	$ (11,573)
Adjustment to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	131	203
Stock-based compensation expense	1,599	1,137
Change in fair value of preferred stock warrant liability	0	51
Non-cash interest expense	133	153
Changes in current assets and liabilities:
Prepaid expenses and other current assets	115	(844)
Accounts payable	(286)	858
Accrued expenses and other current liabilities	(3,214)	(2,182)
Net cash used in operating activities	(16,531)	(12,197)
Cash flows from investing activities:
Purchases of property and equipment	0	(47)
Net cash used in investing activities	0	(47)
Cash flows from financing activities:
Payment of deferred offering costs	0	(465)
Proceeds from exercise of common stock options	0	12
Net cash used in financing activities	0	(453)
Net decrease in cash and cash equivalents	(16,531)	(12,697)
Cash and cash equivalents, beginning of period	92,053	79,466
Cash and cash equivalents, end of period	75,522	66,769
Supplemental cash flow information:
Cash paid for interest	669	715
Deferred offering costs included in accounts payable and accrued expenses	0	618
Purchases of property and equipment included in accounts payable and accrued expenses	$ 59	$ 0

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) (Unaudited) - USD ($) $ in Thousands	Total	Common stock	Additional paid-in capital	Treasury stock	Accumulated deficit
Redeemable convertible preferred stock, beginning (in shares) at Dec. 31, 2018	26,831,246
Redeemable convertible preferred stock, beginning at Dec. 31, 2018	$ 197,842
Increase (Decrease) in Temporary Equity [Roll Forward]
Accretion of preferred stock to redemption value	$ 46
Redeemable convertible preferred stock, ending (in shares) at Mar. 31, 2019	26,831,246
Redeemable convertible preferred stock, ending at Mar. 31, 2019	$ 197,888
Beginning balance (in shares) at Dec. 31, 2018		5,193,915		418,981
Beginning balance at Dec. 31, 2018	(149,753)	$ 6	$ 7,290	$ 0	$ (157,049)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of common stock options (in shares)		1,335
Exercise of common stock options	12		12
Accretion of preferred stock to redemption value	(46)		(46)
Stock-based compensation	1,137		1,137
Net loss	(11,573)				(11,573)
Ending balance (in shares) at Mar. 31, 2019		5,195,250		418,981
Ending balance at Mar. 31, 2019	$ (160,223)	$ 6	8,393	$ 0	(168,622)
Redeemable convertible preferred stock, beginning (in shares) at Dec. 31, 2019	0
Redeemable convertible preferred stock, beginning at Dec. 31, 2019	$ 0
Redeemable convertible preferred stock, ending (in shares) at Mar. 31, 2020	0
Redeemable convertible preferred stock, ending at Mar. 31, 2020	$ 0
Beginning balance (in shares) at Dec. 31, 2019		23,607,797		418,981
Beginning balance at Dec. 31, 2019	$ 60,224	$ 24	276,286	$ 0	(216,086)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of common stock options (in shares)	0
Stock-based compensation	$ 1,599		1,599
Net loss	(15,009)				(15,009)
Ending balance (in shares) at Mar. 31, 2020		23,607,797		418,981
Ending balance at Mar. 31, 2020	$ 46,814	$ 24	$ 277,885	$ 0	$ (231,095)

NATURE OF BUSINESS

NATURE OF BUSINESS	3 Months Ended
	Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
NATURE OF BUSINESS	NATURE OF BUSINESS Axcella Health Inc. and subsidiaries ("Axcella," the "Company" or "we") is a biotechnology company that was incorporated in Delaware on August 27, 2008 and has a principal place of business in Cambridge, Massachusetts. The Company is focused on leveraging endogenous metabolic modulators, or EMMs, to pioneer a new approach for treating complex diseases and improving health. The Company's product candidates are comprised of multiple EMMs that are engineered in distinct combinations and ratios with the goal of simultaneously impacting multiple biological pathways. The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, successful development of technology, obtaining additional funding, protection of proprietary technology, compliance with government regulations, risks of failure of preclinical studies, Clinical Studies and Clinical Trials, the need to obtain marketing approval for its product candidates, if required, and successfully market consumer products, fluctuations in operating results, economic pressure impacting therapeutic pricing, dependence on key personnel, risks associated with changes in technologies, development by competitors of technological innovations and the ability to scale manufacturing to large scale production. Product candidates currently under development will require significant additional research and development efforts, including preclinical and clinical testing and any necessary regulatory approval prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel and infrastructure and extensive compliance-reporting capabilities. Even if development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business. The Company has historically funded its operations with proceeds from sales of preferred and common stock and borrowings under a loan and security agreement. As of March 31, 2020, the Company had an accumulated deficit of $231.1 million. The Company expects to continue to generate operating losses in the foreseeable future. The Company expects that its cash and cash equivalents at March 31, 2020 will be sufficient to fund its operations for at least the next twelve months from the date of the issuance of these interim condensed consolidated financial statements. The COVID-19 pandemic has spread globally, including to the United States and European countries, which has resulted in significant governmental measures being implemented to control the spread of the virus, including quarantines, travel restrictions, business shutdowns and clinical site closures to non-essential care and clinical trials. Although we cannot presently predict the scope and severity of COVID-19, these developments and measures could materially and adversely affect our business, our results of operations and financial condition, particularly if the COVID-19 pandemic adversely impacts our ability to conduct and complete our ongoing Clinical Studies and planned Clinical Trials in a timely manner or at all. Additionally, potential shutdowns of government agencies such as the SEC or FDA, may limit our ability to raise capital and negatively impact our product development timelines. The Company considered the impact of COVID-19 on the assumptions and estimates used and determined that there were no material adverse impacts on the Company’s results of operations and financial position as of and for the three months ended March 31, 2020. The full extent of the future impacts of COVID-19 on our operations is uncertain. A prolonged pandemic could have a material adverse impact on financial results and business operations of the Company, including the timing and ability of the Company to complete our ongoing Clinical Studies and planned Clinical Trials and other efforts required to advance the development of our EMMs.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 31, 2020
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The Company's condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"). The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Unaudited Interim Financial Information The Company's unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations. Accordingly, these condensed consolidated financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2019 and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 23, 2020 (the "2019 Annual Report"). The results for any interim period are not necessarily indicative of results for any future period. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited financial statements. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments that are necessary to present fairly the Company’s financial position as of March 31, 2020, the results of its operations for the three months ended March 31, 2020 and 2019, its statement of stockholders’ equity for the three months ended March 31, 2020 and 2019 and its cash flows for the three months ended March 31, 2020 and 2019. Such adjustments are of a normal and recurring nature. The results for the three months ended March 31, 2020 are not necessarily indicative of the results for the year ending December 31, 2020, or for any future period. The accompanying unaudited condensed consolidated financial statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the unaudited condensed consolidated financial statements. As of March 31, 2020, there have been no material changes in the Company's significant accounting policies from those that were disclosed in the 2019 Annual Report. Use of Estimates The preparation of the condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of expenses during the reporting period. The Company bases its estimates on historical experience, known trends and other market-specific or relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts and experience. Actual results may differ from those estimates or assumptions.

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT	3 Months Ended
	Mar. 31, 2020
Property, Plant and Equipment [Abstract]
PROPERTY AND EQUIPMENT	PROPERTY AND EQUIPMENT Property and equipment consist of the following (in thousands): March 31, December 31, Laboratory equipment $ 3,511 $ 3,511 Leasehold improvements 597 597 Office and computer equipment 111 111 Furniture and fixtures 122 122 Property and equipment 4,341 4,341 Less: accumulated depreciation and amortization (3,864) (3,733) Property and equipment, net $ 477 $ 608 Depreciation and amortization expense for the three months ended March 31, 2020 and 2019 was $0.1 million and $0.2 million, respectively.

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	3 Months Ended
	Mar. 31, 2020
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENTS	FAIR VALUE MEASUREMENTS The following table sets forth by level, within the fair value hierarchy, financial assets measured at fair value on a recurring basis (in thousands): Fair value measurements at March 31, 2020 using: Level 1 Level 2 Level 3 Total Assets: Cash Equivalents $ 70,522 $ — $ — $ 70,522 Total $ 70,522 $ — $ — $ 70,522 Fair value measurements at December 31, 2019 using: Level 1 Level 2 Level 3 Total Assets: Cash Equivalents $ 91,803 $ — $ — $ 91,803 Total $ 91,803 $ — $ — $ 91,803 Cash equivalents are comprised of funds held in an exchange traded money market fund and the fair value of the cash equivalents is determined based upon quoted market price for that fund. The carrying value of accounts payable and accrued expenses that are reported on the consolidated balance sheets approximate their fair value due to the short-term nature of these assets and liabilities. The carrying value of the long term debt approximates fair value as evidenced by the 2018 amendment to the Company's debt facility.

ACCRUED EXPENSES AND OTHER CURR

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	3 Months Ended
	Mar. 31, 2020
Payables and Accruals [Abstract]
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other liabilities consisted of the following (in thousands): ​ March 31, December 31, Accrued employee compensation and benefits $ 977 $ 3,109 Accrued external research and development expenses 1,129 1,799 Accrued professional fees 961 985 Other 95 465 Total accrued expenses and other current liabilities $ 3,162 $ 6,358

DEBT FINANCING

DEBT FINANCING	3 Months Ended
	Mar. 31, 2020
Debt Disclosure [Abstract]
DEBT FINANCING	DEBT FINANCING Long term debt consisted of the following (in thousands): ​ March 31, December 31, Principal amount of long term debt $ 26,000 $ 26,000 Debt discount (419) (456) Deferred financing fees (594) (647) Current portion of long term debt (2,167) — Long term debt, net of current portion and discount $ 22,820 $ 24,897 In January 2018, the Company entered into a secured debt facility (the "2018 Facility"). The 2018 Facility has an interest rate equal to the LIBOR plus 8.50% per annum (10.10% as of March 31, 2020) payable monthly. The Company granted the lender a first priority security interest in all assets of the Company, excluding intellectual property and granted a negative pledge on such intellectual property. In October 2018, the Company amended the 2018 Facility (the "Amended 2018 Facility") to extend the interest only period through July 2020 or January 2021 and the Maturity Date to July 2022 or January 2023 if certain conditions are met. The interest rate was not changed through the amendment. Upon completion of the IPO in May 2019, the interest only period was extended through January 2021 and the Maturity Date was extended to January 2023. Monthly principal payments of $1.1 million are to commence February 2021 for 24 months. For the three months ended March 31, 2020 and 2019, interest expense arising from the amortization of the debt discount and deferred financing fees was $0.1 million and $0.2 million, respectively. Terminal Interest Fee The Company's debt facility includes a terminal interest fee obligation totaling $1.4 million, which is due with the final principal payment of the loan and has been modified from time to time as the facilities were amended. The Company is accruing the terminal fee obligation over the term of the facility. The carrying value of the terminal interest fee was $0.9 million and $0.9 million at March 31, 2020 and December 31, 2019, respectively. The scheduled principal maturity of the long term debt, as of March 31, 2020 is as follows (in thousands): Year Ending December 31, 2021 $ 11,917 2022 13,000 2023 1,083 $ 26,000

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY	3 Months Ended
	Mar. 31, 2020
Equity [Abstract]
STOCKHOLDERS' EQUITY	STOCKHOLDERS' EQUITY Redeemable Convertible Preferred Stock Upon closing of the IPO, all outstanding redeemable convertible preferred stock converted into an aggregate of 14,641,997 shares of common stock. The holders of the Company’s preferred stock had certain voting, dividend, and redemption rights, as well as liquidation preferences and conversion privileges. All rights, preferences, and privileges associated with the preferred stock were terminated at the time of the Company’s IPO in conjunction with the conversion of all outstanding shares of preferred stock into shares of common stock. Initial Public Offering In May 2019, the Company issued 3,571,428 common shares at a public offering price of $20.00 per share for net proceeds of $64.5 million, after deducting underwriting discounts and commissions and other offering expenses. 2019 Stock Option and Incentive Plan The 2019 Stock Option and Incentive Plan (the "2019 Plan") was approved by our board of directors on April 29, 2019 and became effective upon completion of the IPO. The 2019 Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock units, restricted stock awards, unrestricted stock awards and cash-based awards to the Company's officers, employees, directors and consultants. The number of shares initially reserved for issuance under the 2019 Plan is 905,000, which shall be cumulatively increased on January 1, 2020 and each January 1 thereafter by 4% of the number of shares of the Company's common stock outstanding on the immediately preceding December 31, or such lesser number of shares determined by the Company's board of directors or compensation committee of the board of directors. On January 1, 2020, the number of shares available for issuance under the 2019 Plan was automatically increased by 927,553 shares. The number of shares available for future grant under the 2019 Plan was 601,721 as of March 31, 2020. 2019 Employee Stock Purchase Plan The 2019 Employee Stock Purchase Plan (the "2019 ESPP") was approved by the Company's board of directors on April 29, 2019 and became effective upon the IPO. A total of 237,181 shares of common stock were initially reserved for issuance under this plan, which shall be cumulatively increased on January 1, 2020 and each January 1 thereafter by 1% of the number of shares of the Company's common stock outstanding on the immediately preceding December 31, or such lesser number of shares determined by the Company's board of directors or compensation committee of the board of directors. On January 1, 2020, the number of shares available to be issued under the ESPP automatically increased by 231,888 shares. As of March 31, 2020, the total number of shares that may be issued under the ESPP was 469,069 shares. As of March 31, 2020, the initial purchase period under the ESPP has not yet commenced. Stock Option Valuation The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option pricing model. As there was no public market for its common stock prior to May 9, 2019, which was the first day of trading, and as the trading history of the Company’s common stock was limited through March 31, 2020, the Company determined the volatility for awards granted based on an analysis of reported data for a group of guideline companies that issued options with substantially similar terms. The expected volatility has been determined using a weighted-average of the historical volatility measures of this group of guideline companies. The Company expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded stock price. The expected term of the Company’s stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The Company has not paid, and does not anticipate paying, cash dividends on its common stock; therefore, the expected dividend yield is assumed to be zero. The assumptions that the Company used to determine the grant-date fair value of stock options granted were as follows: Three Months Ended 2020 2019 Risk-free interest rate 1.64 % 2.30% - 2.50% Expected option life (in years) 6.11 6.25 Expected dividend yield 0 % 0 % Expected volatility 72.5 % 73.4 % Stock Option Activity The following table summarizes the Company’s stock option activity for the three months ended March 31, 2020: Number of Shares Weighted Weighted Intrinsic Outstanding as of January 1, 2020 5,176,944 $ 7.35 Granted 473,090 4.15 Exercised — — Canceled (206,956) 6.75 Outstanding as of March 31, 2020 5,443,078 $ 7.09 8.1 $ 1,035 Exercisable as of March 31, 2020 2,331,934 $ 5.99 7.1 $ 1,027 Vested or expected to vest as of March 31, 2020 5,385,856 $ 7.05 8.0 $ 1,034 The intrinsic value of options exercised during the three months ended March 31, 2020 and 2019 was $0 and $0, respectively. The weighted-average grant date fair value of the options granted during the three months ended March 31, 2020 and 2019, was $2.69 and $5.02 per share, respectively. Restricted Stock Units The following table summarizes the Company's restricted stock unit activity for the three months ended March 31, 2020: Number of Shares Weighted Average Grant Date Fair Value per Share Outstanding as of January 1, 2020 66,801 $ 3.40 Granted 96,166 4.12 Vested — — Forfeited — — Outstanding as of March 31, 2020 162,967 $ 3.82 Stock-based compensation expense The following table summarizes stock-based compensation expense during the three months ended March 31, 2020 and 2019 (in thousands): Three Months Ended 2020 2019 Stock-based compensation expense by type of award: Time-based vesting stock options $ 1,573 $ 1,137 Performance vesting stock options — — Restricted stock units 26 — Total stock compensation expense $ 1,599 $ 1,137 Stock-based compensation related to stock options and unvested stock awards are classified as follows (in thousands): Three Months Ended 2020 2019 Research and development $ 716 $ 482 General and administrative 883 655 Total stock compensation expense $ 1,599 $ 1,137

NET LOSS PER SHARE

NET LOSS PER SHARE	3 Months Ended
	Mar. 31, 2020
Earnings Per Share [Abstract]
NET LOSS PER SHARE	NET LOSS PER SHARE Net Loss Per Share Basic and diluted net loss per share attributable to common stockholders was calculated as follows (in thousands, except share and per share amounts): Three Months Ended 2020 2019 Numerator: Net loss $ (15,009) $ (11,573) Accretion of redeemable convertible preferred stock — (46) Net loss attributable to common stockholders $ (15,009) $ (11,619) Denominator: Weighted average common shares outstanding, basic and diluted 23,188,816 4,775,828 Net loss per share, basic and diluted $ (0.65) $ (2.43) The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect: Three Months Ended 2020 2019 Redeemable convertible preferred stock (as converted to common stock) — 14,641,997 Warrants to purchase redeemable convertible preferred stock (as converted to common stock) — 61,235 Options to purchase common stock 5,443,078 4,573,119 Unvested restricted stock units 162,967 — 5,606,045 19,276,351 Upon closing of the IPO, all of the redeemable convertible preferred stock converted into 14,641,997 shares of common stock. In addition, 3,571,428 shares of common stock were issued as part of the IPO.

RELATED-PARTY TRANSACTIONS

RELATED-PARTY TRANSACTIONS	3 Months Ended
	Mar. 31, 2020
Related Party Transactions [Abstract]
RELATED-PARTY TRANSACTIONS	RELATED-PARTY TRANSACTIONSIn August 2019, the Company entered into a consulting agreement with the Chairman of the Company's Board of Directors, to provide various consulting services to the Company. The total expense under the agreement for the three months ended March 31, 2020 was $0.1 million. As of March 31, 2020, there were no amounts payable to the Chairman for costs related to the consulting agreement.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2020
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	SUBSEQUENT EVENTSThe Company has evaluated subsequent events for financial statement purposes occurring through May 11, 2020, the date that these condensed consolidated financial statements were issued.

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2020
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation and Principles of Consolidation The Company's condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP").
Principles of Consolidation	The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
Use of Estimates	Use of Estimates The preparation of the condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of expenses during the reporting period. The Company bases its estimates on historical experience, known trends and other market-specific or relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts and experience. Actual results may differ from those estimates or assumptions.
Accounting Pronouncements Issued and Not Adopted	Accounting Pronouncements Issued and Not AdoptedIn February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”), as amended by various subsequently issued ASUs. The standard requires lessees to recognize an operating lease with a term greater than one year on their balance sheets as a right-of-use asset and corresponding lease liability, measured at the present value of the lease payments. Lessees are required to classify leases as either finance or operating leases. If the lease is effectively a financed-purchase by the lessee, it is classified as a financing lease, otherwise it is classified as an operating lease. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. In July 2018, the FASB also issued ASU 2018-11, Leases (Topic 842): Targeted Improvements (“ASU 2018-11”), which permits entities to continue applying legacy guidance in ASC 840, Leases, including its disclosure requirements, in the comparative periods presented in the year that the entity adopts the new leasing standard. The new standard will become effective for the Company on January 1, 2021. The Company will apply the transition method permitted by ASU 2018-11. The Company is evaluating the effect that adoption of the standard is expected to have on the Company’s consolidated financial statements and related disclosures and will recognize a lease obligation and right of use asset for its existing operating leases upon adoption. The Company expects to take advantage of certain available expedients by electing the transition package of practical expedients permitted within ASU 2016-02, which allows the Company to not reassess previous accounting conclusions around whether arrangements are, or contain, leases, the classification of leases, and the treatment of initial direct costs. The Company also expects to make an accounting policy election to exclude leases with an initial term of twelve months or less from the balance sheet date.

PROPERTY AND EQUIPMENT (Tables)

PROPERTY AND EQUIPMENT (Tables)	3 Months Ended
	Mar. 31, 2020
Property, Plant and Equipment [Abstract]
Summary of Property and Equipment	Property and equipment consist of the following (in thousands): March 31, December 31, Laboratory equipment $ 3,511 $ 3,511 Leasehold improvements 597 597 Office and computer equipment 111 111 Furniture and fixtures 122 122 Property and equipment 4,341 4,341 Less: accumulated depreciation and amortization (3,864) (3,733) Property and equipment, net $ 477 $ 608

FAIR VALUE MEASUREMENTS (Tables

FAIR VALUE MEASUREMENTS (Tables)	3 Months Ended
	Mar. 31, 2020
Fair Value Disclosures [Abstract]
Schedule of Fair Value Hierarchy of Assets and Liabilities	The following table sets forth by level, within the fair value hierarchy, financial assets measured at fair value on a recurring basis (in thousands): Fair value measurements at March 31, 2020 using: Level 1 Level 2 Level 3 Total Assets: Cash Equivalents $ 70,522 $ — $ — $ 70,522 Total $ 70,522 $ — $ — $ 70,522 Fair value measurements at December 31, 2019 using: Level 1 Level 2 Level 3 Total Assets: Cash Equivalents $ 91,803 $ — $ — $ 91,803 Total $ 91,803 $ — $ — $ 91,803

ACCRUED EXPENSES AND OTHER CU_2

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Payables and Accruals (Tables)	3 Months Ended
	Mar. 31, 2020
Payables and Accruals [Abstract]
Schedule of Accrued Expenses and Other Liabilities	Accrued expenses and other liabilities consisted of the following (in thousands): ​ March 31, December 31, Accrued employee compensation and benefits $ 977 $ 3,109 Accrued external research and development expenses 1,129 1,799 Accrued professional fees 961 985 Other 95 465 Total accrued expenses and other current liabilities $ 3,162 $ 6,358

DEBT FINANCING (Tables)

DEBT FINANCING (Tables)	3 Months Ended
	Mar. 31, 2020
Debt Disclosure [Abstract]
Summary of Long-term Debt	Long term debt consisted of the following (in thousands): ​ March 31, December 31, Principal amount of long term debt $ 26,000 $ 26,000 Debt discount (419) (456) Deferred financing fees (594) (647) Current portion of long term debt (2,167) — Long term debt, net of current portion and discount $ 22,820 $ 24,897
Schedule of Maturities of Long-term Debt	The scheduled principal maturity of the long term debt, as of March 31, 2020 is as follows (in thousands): Year Ending December 31, 2021 $ 11,917 2022 13,000 2023 1,083 $ 26,000

STOCKHOLDERS' EQUITY (Tables)

STOCKHOLDERS' EQUITY (Tables)	3 Months Ended
	Mar. 31, 2020
Equity [Abstract]
Summary of Fair Value Assumptions for Stock Options	The assumptions that the Company used to determine the grant-date fair value of stock options granted were as follows: Three Months Ended 2020 2019 Risk-free interest rate 1.64 % 2.30% - 2.50% Expected option life (in years) 6.11 6.25 Expected dividend yield 0 % 0 % Expected volatility 72.5 % 73.4 %
Summary of Options Plan	The following table summarizes the Company’s stock option activity for the three months ended March 31, 2020: Number of Shares Weighted Weighted Intrinsic Outstanding as of January 1, 2020 5,176,944 $ 7.35 Granted 473,090 4.15 Exercised — — Canceled (206,956) 6.75 Outstanding as of March 31, 2020 5,443,078 $ 7.09 8.1 $ 1,035 Exercisable as of March 31, 2020 2,331,934 $ 5.99 7.1 $ 1,027 Vested or expected to vest as of March 31, 2020 5,385,856 $ 7.05 8.0 $ 1,034
Share-based Payment Arrangement, Restricted Stock Unit, Activity	The following table summarizes the Company's restricted stock unit activity for the three months ended March 31, 2020: Number of Shares Weighted Average Grant Date Fair Value per Share Outstanding as of January 1, 2020 66,801 $ 3.40 Granted 96,166 4.12 Vested — — Forfeited — — Outstanding as of March 31, 2020 162,967 $ 3.82
Summary of Stock Based Compensation Expense	The following table summarizes stock-based compensation expense during the three months ended March 31, 2020 and 2019 (in thousands): Three Months Ended 2020 2019 Stock-based compensation expense by type of award: Time-based vesting stock options $ 1,573 $ 1,137 Performance vesting stock options — — Restricted stock units 26 — Total stock compensation expense $ 1,599 $ 1,137 Stock-based compensation related to stock options and unvested stock awards are classified as follows (in thousands): Three Months Ended 2020 2019 Research and development $ 716 $ 482 General and administrative 883 655 Total stock compensation expense $ 1,599 $ 1,137

NET LOSS PER SHARE (Tables)

NET LOSS PER SHARE (Tables)	3 Months Ended
	Mar. 31, 2020
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted	Basic and diluted net loss per share attributable to common stockholders was calculated as follows (in thousands, except share and per share amounts): Three Months Ended 2020 2019 Numerator: Net loss $ (15,009) $ (11,573) Accretion of redeemable convertible preferred stock — (46) Net loss attributable to common stockholders $ (15,009) $ (11,619) Denominator: Weighted average common shares outstanding, basic and diluted 23,188,816 4,775,828 Net loss per share, basic and diluted $ (0.65) $ (2.43)
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	Three Months Ended 2020 2019 Redeemable convertible preferred stock (as converted to common stock) — 14,641,997 Warrants to purchase redeemable convertible preferred stock (as converted to common stock) — 61,235 Options to purchase common stock 5,443,078 4,573,119 Unvested restricted stock units 162,967 — 5,606,045 19,276,351

NATURE OF BUSINESS (Details)

NATURE OF BUSINESS (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accumulated deficit	$ 231,095	$ 216,086

PROPERTY AND EQUIPMENT - Summar

PROPERTY AND EQUIPMENT - Summary of Property and Equipment (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Line Items]
Property and equipment	$ 4,341	$ 4,341
Less: accumulated depreciation and amortization	(3,864)	(3,733)
Property and equipment, net	477	608
Laboratory equipment
Property, Plant and Equipment [Line Items]
Property and equipment	3,511	3,511
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment	597	597
Office and computer equipment
Property, Plant and Equipment [Line Items]
Property and equipment	111	111
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment	$ 122	$ 122

PROPERTY AND EQUIPMENT - Narrat

PROPERTY AND EQUIPMENT - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Property, Plant and Equipment [Abstract]
Depreciation and amortization	$ 131	$ 203

FAIR VALUE MEASUREMENTS - Fair

FAIR VALUE MEASUREMENTS - Fair Value Hierarchy (Details) - Fair Value, Recurring - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Assets:
Cash Equivalents	$ 70,522	$ 91,803
Total	70,522	91,803
Level 1
Assets:
Cash Equivalents	70,522	91,803
Total	70,522	91,803
Level 2
Assets:
Cash Equivalents	0	0
Total	0	0
Level 3
Assets:
Cash Equivalents	0	0
Total	$ 0	$ 0

ACCRUED EXPENSES AND OTHER CU_3

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Payables and Accruals [Abstract]
Accrued employee compensation and benefits	$ 977	$ 3,109
Accrued external research and development expenses	1,129	1,799
Accrued professional fees	961	985
Other	95	465
Total accrued expenses and other current liabilities	$ 3,162	$ 6,358

DEBT FINANCING - Summary of Lon

DEBT FINANCING - Summary of Long-term Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Debt Disclosure [Abstract]
Principal amount of long term debt	$ 26,000	$ 26,000
Debt discount	(419)	(456)
Deferred financing fees	(594)	(647)
Current portion of long term debt	(2,167)	0
Long term debt, net of current portion and discount	$ 22,820	$ 24,897

DEBT FINANCING - Narrative (Det

DEBT FINANCING - Narrative (Details) - USD ($) $ in Millions	1 Months Ended		3 Months Ended
	Feb. 28, 2021	Jan. 31, 2018	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Oct. 31, 2018
Line of Credit Facility [Line Items]
Interest expense			$ 0.1	$ 0.2
2018 Facility | Secured Debt
Line of Credit Facility [Line Items]
Interest rate at period end			10.10%
2018 Facility | LIBOR | Secured Debt
Line of Credit Facility [Line Items]
Basis spread on interest rate		8.50%
Amended 2018 Facility | Line of Credit
Line of Credit Facility [Line Items]
Terminal fee						$ 1.4
Terminal fee, at carrying value			$ 0.9		$ 0.9
Forecast | Amended 2018 Facility | Line of Credit
Line of Credit Facility [Line Items]
Monthly principal payments	$ 1.1
Term	24 months

DEBT FINANCING - Maturities of

DEBT FINANCING - Maturities of Long-term Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Debt Disclosure [Abstract]
2020	$ 11,917
2021	13,000
2022	1,083
Principal amount of long-term debt	$ 26,000	$ 26,000

STOCKHOLDERS' EQUITY - Redeemab

STOCKHOLDERS' EQUITY - Redeemable Convertible Preferred Stock and IPO Narrative (Details) - IPO $ / shares in Units, $ in Millions	May 13, 2019USD ($)$ / sharesshares
Subsidiary, Sale of Stock [Line Items]
Shares converted	14,641,997
Shares sold	3,571,428
Shares sold, par value (USD per share) | $ / shares	$ 20
Net proceeds on offering | $	$ 64.5

STOCKHOLDERS' EQUITY - 2019 Sto

STOCKHOLDERS' EQUITY - 2019 Stock Option, Incentive Plan and Employee Stock Purchase Plan Narrative (Details) - shares	Jan. 01, 2020	Apr. 29, 2019	Mar. 31, 2020
Stock Option And Incentive Plan 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares reserved for future issuance (in shares)		905,000
Annual percent increase in authorized shares available for issuance under share based payment arrangements		4.00%
2019 Stock Plan | Options to purchase common stock | Common stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Increase in number of shares available under ESPP (in shares)	927,553
Common stock reserved for future issuance (in shares)			601,721
Employee Stock Purchase Plan 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares reserved for future issuance (in shares)		237,181	469,069
Annual percent increase in authorized shares available for issuance under share based payment arrangements		1.00%
Increase in number of shares available under ESPP (in shares)	231,888

STOCKHOLDERS' EQUITY - Stock Op

STOCKHOLDERS' EQUITY - Stock Option Valuation Fair Value Measurement Inputs (Details) - 2010 Plan - Stock options	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk-free interest rate	1.64%
Risk-free interest rate, minimum		2.30%
Risk-free interest rate, maximum		2.50%
Expected option life (in years)	6 years 1 month 9 days	6 years 3 months
Expected dividend yield	0.00%	0.00%
Expected volatility	72.50%	73.40%

STOCKHOLDERS' EQUITY - Summary

STOCKHOLDERS' EQUITY - Summary of Stock Option Activity and Restricted Stock Units (Details) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2020USD ($)$ / sharesshares
Number of Shares
Outstanding, beginning balance (in shares) | shares	5,176,944
Granted (in shares) | shares	473,090
Exercised (in shares) | shares	0
Canceled (in shares) | shares	206,956
Outstanding, ending balance (in shares) | shares	5,443,078
Options exercisable (in shares) | shares	2,331,934
Options vested or expected to vest (in shares) | shares	5,385,856
Weighted Average Exercise Price
Weighted average exercise price, outstanding, beginning balance (USD per share) | $ / shares	$ 7.35
Weighted-average exercise price, granted (USD per share) | $ / shares	4.15
Weighted-average exercise price, exercised (USD per share) | $ / shares	0
Weighted-average exercise price, canceled (USD per share) | $ / shares	6.75
Weighted average exercise price, outstanding, ending balance (USD per share) | $ / shares	7.09
Weighted-average exercise price, options exercisable (USD per share) | $ / shares	5.99
Weighted-average exercise price, options vested or expected to vest (USD per share) | $ / shares	$ 7.05
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Weighted Average Remaining Life, Outstanding (in Years)	8 years 1 month 6 days
Weighted Average Remaining Life, Options exercisable (in Years)	7 years 1 month 6 days
Weighted Average Remaining Life, Options vested or expected to vest (in Years)	8 years
Intrinsic Value, Outstanding | $	$ 1,035
Intrinsic Value, Options exercisable | $	1,027
Intrinsic Value, Options vested or expected to vest | $	$ 1,034
RSUs
Number of Shares
Outstanding, beginning balance (in shares) | shares	66,801
Granted (in shares) | shares	96,166
Vested (in shares) | shares	0
Forfeited (in shares) | shares	0
Outstanding, ending balance (in shares) | shares	162,967
Weighted Average Grant Date Fair Value per Share
Weighted average exercise price, outstanding, beginning balance (USD per share) | $ / shares	$ 3.40
Weighted-average exercise price, granted (USD per share) | $ / shares	4.12
Weighted-average exercise price, vested (USD per share) | $ / shares	0
Weighted-average exercise price, forfeited (USD per share) | $ / shares	0
Weighted average exercise price, outstanding, ending balance (USD per share) | $ / shares	$ 3.82

STOCKHOLDERS' EQUITY - Summar_2

STOCKHOLDERS' EQUITY - Summary of Stock Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	$ 1,599	$ 1,137
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	716	482
General and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	883	655
Time-based vesting stock options
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	1,573	1,137
Performance vesting stock options
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	0	0
Unvested restricted stock units
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	$ 26	$ 0

STOCKHOLDERS' EQUITY - Stock _2

STOCKHOLDERS' EQUITY - Stock Option Activity and Stock-based Compensation Expense Narrative (Details) - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Intrinsic value, options exercised	$ 0	$ 0
Stock options | 2010 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average grand date fair value of options granted in the period (USD per share)	$ 2.69	$ 5.02
Unrecognized compensation expense related to unvested stock options	$ 13,600,000
Unrecognized compensation expense, recognition period	2 years 6 months 25 days
Unvested restricted stock units | 2010 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense related to unvested stock options	$ 600,000
Unrecognized compensation expense, recognition period	2 years 8 months 26 days

NET LOSS PER SHARE - Calculatio

NET LOSS PER SHARE - Calculation of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Numerator:
Net loss	$ (15,009)	$ (11,573)
Accretion of redeemable convertible preferred stock	0	(46)
Net loss attributable to common stockholders	$ (15,009)	$ (11,619)
Denominator:
Weighted average common shares outstanding, basic and diluted (in shares)	23,188,816	4,775,828
Net loss per share, basic and diluted (USD per share)	$ (0.65)	$ (2.43)

NET LOSS PER SHARE - Summary of

NET LOSS PER SHARE - Summary of Anti-dilutive Securities (Details) - shares	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share (in shares)	5,606,045	19,276,351
Redeemable convertible preferred stock (as converted to common stock)
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share (in shares)	0	14,641,997
Warrants to purchase redeemable convertible preferred stock (as converted to common stock)
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share (in shares)	0	61,235
Options to purchase common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share (in shares)	5,443,078	4,573,119
Unvested restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share (in shares)	162,967	0

NET LOSS PER SHARE - Narrative

NET LOSS PER SHARE - Narrative (Details) - IPO	May 13, 2019shares
Class of Stock [Line Items]
Conversion of preferred stock to common stock upon closing of the initial public offering (in shares)	14,641,997
Shares sold	3,571,428

RELATED-PARTY TRANSACTIONS - Na

RELATED-PARTY TRANSACTIONS - Narrative (Details) - Board of Directors Chairman	3 Months Ended
	Mar. 31, 2020USD ($)
Related Party Services Agreement
Related Party Transaction [Line Items]
Related party costs	$ 100,000
Related Party Consulting Agreement
Related Party Transaction [Line Items]
Due to related parties	$ 0