Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Aug. 03, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | CUE | |
Entity Registrant Name | Cue Biopharma, Inc. | |
Entity Central Index Key | 0001645460 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Interactive Data Current | Yes | |
Document Transition Report | false | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Security Exchange Name | NASDAQ | |
Entity Incorporation, State or Country Code | DE | |
Document Quarterly Report | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 29,496,417 | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity File Number | 001-38327 | |
Entity Tax Identification Number | 47-3324577 | |
Entity Address, Address Line One | 21 Erie St. Cambridge | |
Entity Address State Or Province | MA | |
Entity Address, Postal Zip Code | 02139 | |
City Area Code | 617 | |
Local Phone Number | 949-2680 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 59,749,000 | $ 44,290,000 |
Marketable securities | 25,179,000 | 15,120,000 |
Accounts receivable | 1,228,000 | 755,000 |
Prepaid expenses and other current assets | 2,197,000 | 860,000 |
Total current assets | 88,353,000 | 61,025,000 |
Property and equipment, net | 1,592,000 | 1,847,000 |
Operating lease right-of-use | 8,150,000 | 5,337,000 |
Deposits | 2,572,000 | 2,572,000 |
Restricted cash, long term | 150,000 | 150,000 |
Other long term assets | 536,000 | 674,000 |
Total assets | 101,353,000 | 71,605,000 |
Current liabilities: | ||
Accounts payable | 1,289,000 | 883,000 |
Accrued expenses | 4,061,000 | 2,227,000 |
Research and development contract liability, current portion | 5,263,000 | 4,097,000 |
Operating lease liability, current portion | 4,249,000 | 4,448,000 |
Total current liabilities | 14,862,000 | 11,655,000 |
Research and development contract liability, net of current portion | 2,155,000 | 4,018,000 |
Operating lease liability, net of current portion | 4,182,000 | 1,348,000 |
Total liabilities | 21,199,000 | 17,021,000 |
Stockholders’ equity: | ||
Preferred Stock, $0.001 par value; 10,000,000 shares authorized and 0 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively | ||
Common stock, $0.001 par value; 50,000,000 shares authorized; 29,303,192 and 26,562,178 shares issued and outstanding, at June 30, 2020 and December 31, 2019, respectively | 29,000 | 26,000 |
Additional paid in capital | 212,121,000 | 163,068,000 |
Accumulated other comprehensive income/ (loss) | 155,000 | (10,000) |
Accumulated deficit | (132,151,000) | (108,500,000) |
Total stockholders’ equity | 80,154,000 | 54,584,000 |
Total liabilities and stockholders’ equity | $ 101,353,000 | $ 71,605,000 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) (Unaudited) - $ / shares | Jun. 30, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 29,303,192 | 26,562,178 |
Common stock, shares outstanding | 29,303,192 | 26,562,178 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Other Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Statement [Abstract] | ||||
Collaboration revenue | $ 1,075 | $ 1,055 | $ 1,975 | $ 1,425 |
Operating expenses: | ||||
General and administrative | 3,898 | 3,419 | 7,887 | 6,864 |
Research and development | 8,119 | 6,867 | 18,025 | 15,220 |
Total operating expenses | 12,017 | 10,286 | 25,912 | 22,084 |
Loss from operations | (10,942) | (9,231) | (23,937) | (20,659) |
Other income: | ||||
Interest income | 134 | 96 | 337 | 210 |
Other (expense) income | (25) | 26 | (51) | 71 |
Total other income | 109 | 122 | 286 | 281 |
Loss Before Income Taxes | (10,833) | (9,109) | (23,651) | (20,378) |
Income Tax Expense | (413) | (413) | ||
Net loss | (10,833) | (9,522) | (23,651) | (20,791) |
Unrealized gains (losses) from available-for-sale securities | (94) | 3 | 165 | 11 |
Comprehensive loss | $ (10,927) | $ (9,519) | $ (23,486) | $ (20,780) |
Net loss per common share – basic and diluted | $ (0.38) | $ (0.46) | $ (0.86) | $ (1) |
Weighted average common shares outstanding – basic and diluted | 28,221,537 | 20,821,390 | 27,391,081 | 20,770,173 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | AOCI Attributable to Parent | Accumulated Deficit |
Balance at Dec. 31, 2016 | $ 15,175 | $ 11 | $ 24,751 | $ (9,587) | |
Balance, Shares at Dec. 31, 2016 | 10,635,684 | ||||
Issuance of common stock from public offerings, net of underwriter discounts | 66,155 | $ 9 | 66,146 | ||
Issuance of common stock from public offerings, net of underwriter discounts, Shares | 8,820,710 | ||||
Costs incurred in connection withinitial public offering | (8,397) | (8,397) | |||
Stock-based compensation | 2,775 | 2,775 | |||
Common stock to be issued pursuant to license agreements | 5,037 | 5,036 | |||
Proceeds from sale of placement agent warrants | 1 | 1 | |||
Fair value of warrants issued inconnection with initial public offering of common stock | 4,087 | 4,087 | |||
Exercise of stock options | 8 | $ 3 | 8 | ||
Exercise of stock options, Shares | 2,800 | ||||
Net loss | (23,234) | (23,234) | |||
Balance at Dec. 31, 2018 | 33,972 | $ 21 | 105,763 | $ (11) | (71,801) |
Balance, Shares at Dec. 31, 2018 | 20,697,453 | ||||
Issuance of common stock from public offerings, net of underwriter discounts | 3,715 | 3,715 | |||
Issuance of common stock from public offerings, net of underwriter discounts, Shares | 524,074 | ||||
Stock-based compensation | 3,085 | 3,085 | |||
Exercise of stock options | 289 | 289 | |||
Exercise of stock options, Shares | 92,043 | ||||
Unrealized gains from available-for-sale securities | 11 | 11 | |||
Net loss | (20,791) | (20,791) | |||
Balance at Jun. 30, 2019 | 20,281 | $ 21 | 112,852 | (92,592) | |
Balance, Shares at Jun. 30, 2019 | 21,313,570 | ||||
Balance at Mar. 31, 2019 | 24,736 | $ 21 | 107,788 | (3) | (83,070) |
Balance, Shares at Mar. 31, 2019 | 20,783,246 | ||||
Issuance of common stock from public offerings, net of underwriter discounts | 3,715 | 3,715 | |||
Issuance of common stock from public offerings, net of underwriter discounts, Shares | 524,074 | ||||
Stock-based compensation | 1,317 | 1,317 | |||
Exercise of stock options | 32 | 32 | |||
Exercise of stock options, Shares | 6,250 | ||||
Unrealized gains from available-for-sale securities | 3 | 3 | |||
Net loss | (9,522) | (9,522) | |||
Balance at Jun. 30, 2019 | 20,281 | $ 21 | 112,852 | (92,592) | |
Balance, Shares at Jun. 30, 2019 | 21,313,570 | ||||
Balance at Dec. 31, 2019 | 54,584 | $ 26 | 163,068 | (10) | (108,500) |
Balance, Shares at Dec. 31, 2019 | 26,562,178 | ||||
Issuance of common stock from public offerings, net of underwriter discounts | 42,353 | $ 2 | 42,351 | ||
Issuance of common stock from public offerings, net of underwriter discounts, Shares | 2,174,901 | ||||
Stock-based compensation | 5,699 | 5,699 | |||
Exercise of stock options | $ 1,080 | 1,080 | |||
Exercise of stock options, Shares | 276,622 | 276,622 | |||
Issuance of common stock upon exercise of warrants, net | $ 1 | (1) | |||
Issuance of common stock upon exercise of warrants, net, Shares | 278,179 | ||||
Restricted stock awards released, shares | 16,666 | ||||
Restricted stock withheld to cover taxes | $ (76) | (76) | |||
Restricted stock buy-back at vesting to cover taxes, Shares | (5,354) | ||||
Unrealized gains from available-for-sale securities | 165 | 165 | |||
Net loss | (23,651) | (23,651) | |||
Balance at Jun. 30, 2020 | 80,154 | $ 29 | 212,121 | 155 | (132,151) |
Balance, Shares at Jun. 30, 2020 | 29,303,192 | ||||
Balance at Mar. 31, 2020 | 45,236 | $ 27 | 166,278 | 249 | (121,318) |
Balance, Shares at Mar. 31, 2020 | 26,575,959 | ||||
Issuance of common stock from public offerings, net of underwriter discounts | 42,352 | $ 1 | 42,351 | ||
Issuance of common stock from public offerings, net of underwriter discounts, Shares | 2,174,901 | ||||
Stock-based compensation | 2,524 | 2,524 | |||
Exercise of stock options | 1,045 | 1,045 | |||
Exercise of stock options, Shares | 262,841 | ||||
Issuance of common stock upon exercise of warrants, net | $ 1 | (1) | |||
Issuance of common stock upon exercise of warrants, net, Shares | 278,179 | ||||
Restricted stock awards released, shares | 16,666 | ||||
Restricted stock withheld to cover taxes | (76) | (76) | |||
Restricted stock buy-back at vesting to cover taxes, Shares | (5,354) | ||||
Unrealized gains from available-for-sale securities | (94) | (94) | |||
Net loss | (10,833) | (10,833) | |||
Balance at Jun. 30, 2020 | $ 80,154 | $ 29 | $ 212,121 | $ 155 | $ (132,151) |
Balance, Shares at Jun. 30, 2020 | 29,303,192 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Cash flows from operating activities | ||
Net loss | $ (23,651) | $ (20,791) |
Adjustments to reconcile net loss to cash used in operating activities: | ||
Depreciation and amortization | 535 | 410 |
Stock-based compensation | 5,699 | 3,085 |
Change in operating lease right-of-use asset | (2,813) | 2,013 |
Other non cash income | (1) | |
Amortization of premium/discount on purchased securities | 55 | (71) |
Loss on disposal of fixed asset | 54 | |
Changes in operating assets and liabilities: | ||
Account receivable | (473) | (522) |
Prepaid expenses and other current assets | (1,337) | (447) |
Operating lease liability | 2,636 | (1,524) |
Accounts payable | 406 | 254 |
Accrued expenses | 1,833 | 792 |
Research and development contract liability | (698) | 1,597 |
Net cash used in operating activities | (17,808) | (15,151) |
Cash flows from investing activities | ||
Purchases of property and equipment | (141) | (19) |
Cash received from sale of fixed asset | 127 | |
Redemption of short term investments | 14,500 | |
Purchases of marketable securities | (9,949) | |
Net cash (used in) provided by investing activities | (10,090) | 14,608 |
Cash flows from financing activities | ||
Proceeds from the public offering of common stock, net of underwriter's commission and fees | 42,353 | 3,715 |
Proceeds from exercise of stock options | 1,080 | 289 |
Restricted stock buy-back at vesting to cover taxes | (76) | |
Net cash provided by financing activities | 43,357 | 4,004 |
Net increase in cash, cash equivalents, and restricted cash | 15,459 | 3,461 |
Cash, cash equivalents, and restricted cash at beginning of period | 44,440 | 21,000 |
Cash, cash equivalents, and restricted cash at end of period | $ 59,899 | 24,461 |
Supplemental disclosures of non-cash investing activities: | ||
Income Taxes | $ (413) |
Organization and Basis of Prese
Organization and Basis of Presentation | 6 Months Ended |
Jun. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization and Basis of Presentation | 1. Cue Biopharma, Inc. (the “Company”) was incorporated in the State of Delaware on December 31, 2014 under the name Imagen Biopharma, Inc., and completed its organization, formation, and initial capitalization activities effective as of January 1, 2015. In October 2016, the Company changed its name to Cue Biopharma, Inc. The Company’s corporate office and research facilities are located in Cambridge, Massachusetts. The Company is a clinical-stage biopharmaceutical company engineering a novel class of injectable biologics designed to selectively engage and modulate targeted T cells within the body to treat a broad range of cancers, chronic infectious diseases, and autoimmune disorders. The Company is in the development stage and has incurred recurring losses and negative cash flows from operations. As of June 30, 2020, the Company had unrestricted cash, cash equivalents, and marketable securities of approximately $84,928,000. Management believes that current cash and cash equivalents on hand at June 30, 2020 are sufficient to fund operations for at least the next twelve months from the date of issuance of these financial statements; however, the future viability of the Company is dependent on its ability to raise additional capital to finance its operations and to fund increased research and development costs in order to seek approval for commercialization of its product candidates. The Company’s failure to raise capital as and when needed would have a negative impact on its financial condition and its ability to pursue its business strategies as this capital is necessary for the Company to perform the research and development activities required to develop the Company’s product candidates in order to generate future revenue streams. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Basis of Presentation The accompanying unaudited consolidated financial statements as of June 30, 2020, and for the three and six months ended June 30, 2020, and 2019, have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) and Generally Accepted Accounting Principles in the United States (“U.S. GAAP”) for financial information, which prescribes elimination of all significant intercompany accounts and transactions in the accounts of the Company and its wholly owned subsidiary, Cue Biopharma Securities Corporation, Inc., which was formed in December 2018 and incorporated in the Commonwealth of Massachusetts. In the opinion of management, these financial statements reflect all adjustments which are necessary for a fair statement of the Company’s financial position and results of its operations, as of and for the periods presented Interim results for the three and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020, or any future periods. Public Offerings In March 2020, the Company entered into an “at-the-market” (ATM) equity offering sales agreement (the “March 2020 ATM Agreement”) with Stifel Nicolaus & Company, Inc. (“Stifel”) to sell shares of the Company’s common stock for aggregate gross proceeds of up to $35 million, from time to time, through an ATM equity offering program under which Stifel acted as sales agent. As of June 30, 2020, the Company had sold 1,824,901 shares of common stock under the March 2020ATM Agreement for proceeds of approximately $34.3 million, net of commissions paid, but excluding estimated transaction expenses. Due to the issuance and sale of all the shares of common stock subject thereto, the March 2020 sales agreement terminated in accordance with its terms. . In June 2020, the Company entered into another ATM equity offering sales agreement with Stifel (the “June 2020 ATM Agreement”) to sell shares of the Company’s common stock for aggregate gross proceeds of up to $40 million, from time to time, through an ATM equity offering program under which Stifel acts as sales agent. The sales agreement will terminate upon the earliest of (a) the sale of $40 million of shares of the Company’s common stock or (b) the termination of the sales agreement by the Company or Stifel. As of June 30, 2020, the Company had sold 350,000 shares of common stock under the June 2020 sales agreement for proceeds of approximately $8.1 million, net of commissions paid, but excluding estimated transaction expenses. Refer to Note 11 Subsequent Events for sales subsequent to June 30, 2020. Consolidation The accompanying consolidated financial statements include the Company and its wholly owned subsidiary, Cue Biopharma Securities Corporation, Inc. The Company has eliminated all intercompany transactions. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Significant estimates include estimates related to collaboration revenue, the accounting for potential liabilities and accrued expenses, the assumptions utilized in valuing stock-based compensation issued for services, the realization of deferred tax assets, and the useful life with respect to long-lived assets and intangibles. Actual results could differ from those estimates. The COVID-19 outbreak, which the World Health Organization has classified as a pandemic, has prompted governments and regulatory bodies throughout the world to issue “stay-at-home” or similar orders, and enact restrictions on the performance of “non-essential” services, public gatherings and travel. The extent to which COVID-19 impacts the Company’s business and financial results will depend on numerous evolving factors including, but not limited to: the magnitude and duration of COVID-19, the extent to which it will impact worldwide macroeconomic conditions, the speed of the anticipated recovery, access to capital markets, and governmental and business reactions to the pandemic. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts of COVID-19 as of June 30, 2020 and through the date of the filing of this Quarterly Report on Form 10-Q. The accounting matters assessed included, but were not limited to estimates related to collaboration revenue, the accounting for potential liabilities and accrued expenses, the assumptions utilized in valuing stock-based compensation issued for services, the realization of deferred tax assets, and assessments of impairment related to long-lived assets and intangibles. The Company’s future assessment of the magnitude and duration of COVID-19, as well as other factors, could result in additional material impacts to the Company’s consolidated financial statements in future reporting periods. Despite the Company’s efforts, the ultimate impact of COVID-19 depends on factors beyond the Company’s knowledge or control, including the duration and severity of the outbreak, as well as third-party actions taken to contain its spread and mitigate its public health effects. As a result, the Company is unable to estimate the extent to which COVID-19 will negatively impact its financial results or liquidity. Cash Concentrations The Company maintains its cash balances with a financial institution in federally insured accounts and may periodically have cash balances in excess of insurance limits. The Company maintains its accounts with a financial institution with a high credit rating. The Company has not experienced any losses to date and believes that it is not exposed to any significant credit risk on cash. Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less at the date of purchase to be cash equivalents. The Company currently invests available cash in money market funds. Marketable Securities Marketable securities consist of investments with original maturities greater than ninety days and less than one year from the balance sheet date. The Company classifies all of its investments as available-for-sale securities. Accordingly, these investments are recorded at fair value, which is based on quoted market prices. Unrealized gains and losses are recognized and determined on a specific identification basis and are included in other comprehensive loss. Realized gains and losses are determined on a specific identification basis and are included in other income (loss) on the income statement. Amortization and accretion of discounts and premiums is recorded in interest income. The Company has invested available cash in United States Treasury obligations. Restricted Cash The Company had $150,000 in restricted cash deposited with a commercial bank to collateralize a credit card as of June 30, 2020 and December 31, 2019. Property and Equipment Property and equipment is recorded at cost. Major improvements are capitalized, while maintenance and repairs are charged to expense as incurred. Gains and losses from disposition of property and equipment are included in income and expense when realized. Amortization of leasehold improvements is provided using the straight-line method over the shorter of the lease term or the useful life of the underlying assets. Depreciation of property and equipment is provided using the straight-line method over the following estimated useful lives: Laboratory equipment 5 years Computer and office equipment 3 years Furniture and fixtures 3-8 years The Company recognizes depreciation and amortization expense in general and administrative expenses and in research and development expenses in the Company’s statements of operations, depending on how each category of property and equipment is utilized in the Company’s business activities. Trademark Trademark consists of the Company’s right, title and interest to the CUE BIOLOGICS Mark, and any derivative mark incorporating CUE, throughout the world, together with all associated goodwill and common law rights appurtenant thereto, including, but not limited to, any right, title and interest in any corporate name, company name, business, name, trade name, dba, domain name, or other source identifier incorporating CUE. The Company has classified the trademark as a component of other long-term assets, having a useful life of 14 years at June 30, 2020 Revenue Recognition The Company recognizes collaboration revenue under certain of the Company’s license or collaboration agreements that are within the scope of ASC 606. The Company’s contracts with customers typically include promises related to licenses to intellectual property and research and development services. If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenue from non-refundable, up-front fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgement to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. Accordingly, the transaction price is generally comprised of a fixed fee due at contract inception and variable consideration in the form of milestone payments due upon the achievement of specified events and tiered royalties earned when customers recognize net sales of licensed products. The Company measures the transaction price based on the amount of consideration to which it expects to be entitled in exchange for transferring the promised goods and/or services to the customer. The Company utilizes the “most likely amount” method to estimate the amount of variable consideration, to predict the amount of consideration to which it will be entitled for its one open contract. Amounts of variable consideration are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. At the inception of each arrangement that includes development and regulatory milestone payments, the Company evaluates whether the associated event is considered probable of achievement and estimates the amount to be included in the transaction price using the most likely amount method. Currently, the Company has one contract with an option to acquire additional goods and/or services in the form of additional research and development services for additional product candidates which it evaluated and determined was not a material right related to such agreement and so was not included in the transaction price. Research and Development Expenses Research and development expenses consist primarily of compensation costs, fees paid to consultants, outside service providers and organizations (including research institutes at universities), facility costs, and development and clinical trial costs with respect to the Company’s product candidates. Research and development expenses incurred under contracts are expensed ratably over the life of the underlying contracts, unless the achievement of milestones, the completion of contracted work, or other information indicates that a different pattern of performance is more appropriate. Other research and development expenses are charged to operations as incurred. Nonrefundable advance payments are recognized as an expense as the related services are performed. The Company evaluates whether it expects the services to be rendered at each quarter end and year end reporting date. If the Company does not expect the services to be rendered, the advance payment is charged to expense. Nonrefundable advance payments for research and development services are included in prepaid and other current assets on the balance sheet. To the extent that a nonrefundable advance payment is for contracted services to be performed within 12 months from the reporting date, such advance is included in current assets; otherwise, such advance is included in non-current assets. The Company evaluates the status of its research and development agreements and contracts, and the carrying amount of the related assets and liabilities, at each quarter end and year end reporting date, and adjusts the carrying amounts and their classification on the balance sheet as appropriate. Patent Expenses The Company is the exclusive worldwide licensee of, and has patent applications pending for, numerous domestic and foreign patents. Due to the significant uncertainty associated with the successful development of one or more commercially viable product candidates based on the Company’s research efforts and any related patent applications, all patent costs, including patent-related legal fees, filing fees and other costs are charged to expense as incurred. For the three and six months ended June 30, 2020, patent expenses were $686,000 and $1,340,000, respectively. For the three and six months ended June 30, 2019, patent expenses were $277,000 and $846,000, respectively. Patent expenses are included in general and administrative expenses in the Company’s statements of operations. Licensing Fees and Costs Licensing fees and costs consist primarily of costs relating to the acquisition of the Company’s license agreement with the Albert Einstein College of Medicine (“Einstein”), including related royalties, maintenance fees, milestone payments and product development costs. Licensing fees and costs are charged to expense as incurred. Long-Lived Assets The Company reviews long-lived assets, consisting of property and equipment, for impairment at each fiscal year end or when events or changes in circumstances indicate the carrying value of these assets may exceed their current fair values. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the assets. Assets to be disposed of are separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell and are no longer depreciated. The Company has not historically recorded any impairment to its long-lived assets. In the future, if events or market conditions affect the estimated fair value to the extent that a long-lived asset is impaired, the Company will adjust the carrying value of these long-lived assets in the period in which the impairment occurs. During the three and six months ended June 30, 2020, there were no disposals of property and equipment. Leases In February 2016, the FASB issued ASU 2016-02, Leases The standard permits two transition methods, (1) to apply the new lease requirements at the beginning of the earliest period presented, or (2) to apply the new lease requirements at the effective date. The Company adopted ASC 842 as of January 1, 2019 using the effective date method, in which we did not restate prior periods. Upon adoption, the Company elected the package of practical expedients permitted under the transition guidance within ASC 842, which among other things, allowed it to carry forward the historical lease classification. The adoption of ASC 842 on January 1, 2019 resulted in the recognition of approximately $9,692,000 of right-of-use asset and $9,347,000 of lease liabilities on the Company’s balance sheet. The adoption did not have a material net impact on the Company’s consolidated statements of operations or accumulated deficit. Please refer to Note 10 for more detail. Stock-Based Compensation The Company periodically issues stock based awards to officers, directors, employees, Scientific and Clinical Advisory Board members, non-employees and consultants for services rendered. Such issuances vest and expire according to terms established at the issuance date. Stock-based payments to officers, directors, members of the Company’s Scientific and Clinical Advisory Board, non-employees and outside consultants and employees, including grants of employee stock options, are recognized in the financial statements based on their grant date fair values. Stock option grants, which are generally time-vested, are measured at the grant date fair value and charged to operations on a straight-line basis over the service period, which generally approximates the vesting term. The Company also grants performance-based awards periodically to officers of the Company. The Company recognizes compensation costs related to performance awards over the requisite service period if and when the Company concludes that it is probable that the performance condition will be achieved. The fair value of stock options and restricted stock units is determined utilizing the Black-Scholes option-pricing model, which is affected by several variables, including the risk-free interest rate, the expected dividend yield, the life of the equity award, the exercise price of the stock option as compared to the fair value of the common stock on the grant date, and the estimated volatility of the common stock over the term of the equity award. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. Until the Company has established a trading market for its common stock, estimated volatility is based on the average historical volatilities of comparable public companies in a similar industry. The expected dividend yield is based on the current yield at the grant date; the Company has never declared or paid dividends and has no plans to do so for the foreseeable future. As permitted by Staff Accounting Bulletin No. 107, due to the Company’s lack of trading history and option activity, management utilizes the simplified method to estimate the expected term of options at the date of grant. The exercise price is determined based on the fair value of the Company’s common stock at the date of grant. The Company accounts for forfeitures as they occur. The Company recognizes the fair value of stock-based compensation in general and administrative expenses and in research and development expenses in the Company’s statements of operations, depending on the type of services provided by the recipient of the equity award. Comprehensive Income (Loss) Components of comprehensive income or loss, including net income or loss, are reported in the financial statements in the period in which they are recognized. Other comprehensive income or loss is defined as the change in equity during a period from transactions and other and other events and circumstances from non-owner sources. Net income (loss) and other comprehensive income (loss) are reported net of any related tax effect to arrive at comprehensive income (loss). Comprehensive income (loss) includes net income (loss) as well as changes in stockholders’ equity that result from transactions and economic events other than those with stockholders. The Company’s only element of other comprehensive income (loss) in all periods presented was unrealized gain or loss on available-for-sale securities. Earnings (Loss) Per Share The Company’s computation of earnings (loss) per share (“EPS”) for the respective periods includes basic and diluted EPS. Basic EPS is measured as the income (loss) attributable to common stockholders divided by the weighted average number of common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares that would result from the exercise of outstanding stock options and warrants as if they had been exercised at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. Basic and diluted loss per common share is the same for all periods presented because all outstanding stock options and warrants are anti-dilutive. At June 30, 2020, the Company excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from its calculation of earnings per share, as their effect would have been anti-dilutive. June 30, 2020 2019 Common stock warrants 861,969 1,252,441 Common stock options 5,482,057 4,811,378 Total 6,344,026 6,063,819 Fair Value of Financial Instruments The authoritative guidance with respect to fair value established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels and requires that assets and liabilities carried at fair value be classified and disclosed in one of three categories, as presented below. Level 1. Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability to access as of the measurement date. Financial assets and liabilities utilizing Level 1 inputs include active-exchange traded securities and exchange-based derivatives. Level 2. Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange-based derivatives, mutual funds, and fair-value hedges. Level 3. Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity to develop its own assumptions. Financial assets and liabilities utilizing Level 3 inputs include infrequently traded non-exchange-based derivatives and commingled investment funds and are measured using present value pricing models. The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end. The Company had approximately $32,687,000 in cash equivalents and $25,179,000 in short-term marketable securities that were measured and recorded at fair value on the Company’s balance sheet as of June 30, 2020. The Company had approximately $39,304,000 in cash equivalents and $15,120,000 in short-term marketable securities that were measured and recorded at fair value on the Company’s balance sheet as of December 31, 2019. The carrying value of financial instruments (consisting of cash, a certificate of deposit, accounts payable, accrued compensation and accrued expenses) is considered to be representative of their respective fair values due to the short-term nature of those instruments. Recent Accounting Pronouncements In June 2016, the FASB issued Accounting Standard Update (ASU) No. 2016-13 , Financial Instruments- Credit Losses: Measurement of Credit Losses on Financial Instruments The new standard requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. annual reporting period for smaller reporting companies. T he Company is still evaluating the impact of ASU 2016-13 on the Company’s consolidated financial statements; however, it does not expect the impact to be material. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures. |
Fair Value
Fair Value | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value | 3. The Company accounts for its financial assets and liabilities using fair value measurements. The authoritative accounting guidance defines fair value, establishes a framework for measuring fair value under generally accepted accounting principles and enhances disclosures about fair value measurements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The following table presents information about the Company’s assets that are measured at fair value on a recurring basis as of June 30, 2020 and December 31, 2019, and indicate the level of the fair value hierarchy utilized to determine such fair value: Fair Value Measurements as of June 30, 2020 (in thousands) Level 1 Level 2 Level 3 Fair Value Cash equivalents $ 32,687 $ — $ — $ 32,687 Marketable securities — 25,179 — 25,179 Total $ 32,687 $ 25,179 $ — $ 57,866 Fair Value Measurements as of December 31, 2019 (in thousands) Level 1 Level 2 Level 3 Fair Value Cash equivalents $ 39,304 $ — $ — $ 39,304 Marketable securities — 15,120 — 15,120 Total $ 39,304 $ 15,120 $ — $ 54,424 As of June 30, 2020, the Company reported approximately $57,866,000 of cash equivalents and marketable securities. The Company’s cash equivalents that are invested in money market funds are valued using Level 1 inputs for identical securities. The Company measures the fair value of marketable securities that are invested in United States Treasury securities using Level 2 inputs and primarily relies on quoted prices in active markets for similar marketable securities. During the three and six months ended June 30, 2020, there were no transfers between Level 2 and Level 3. All Level 2 securities are classified as Debt Securities and are not subject to ASU 2016-01, Financial Instruments The carrying values of accounts receivable, prepaid expenses, other current assets, accounts payable and accrued expenses approximate their fair value due to the short-term nature of these balances. |
Marketable Securities
Marketable Securities | 6 Months Ended |
Jun. 30, 2020 | |
Investments Debt And Equity Securities [Abstract] | |
Marketable Securities | 4. Marketable Securities As of June 30, 2020 and December 31, 2019, the fair value of available-for-sale marketable securities by type of security was as follows: June 30, 2020 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. Treasury Securities $ 25,025 $ 155 $ — $ 25,179 $ 25,025 $ 155 $ — $ 25,179 December 31, 2019 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. Treasury Securities $ 15,130 $ — $ (10 ) $ 15,120 $ 15,130 $ — $ (10 ) $ 15,120 At June 30, 2020, there were $25,179,000 of investments in marketable securities that mature within twelve months. At December 31, 2019, marketable securities consisted of approximately $15,120,000 of investments that mature within twelve months. |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2020 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | 5 . Property and equipment as of June 30, 2020 and December 31, 2019 consisted of the following: June 30, 2020 December 31, 2019 (in thousands) Computer equipment $ 268 $ 192 Laboratory equipment 3,653 3,588 Furniture and fixtures 93 93 4,014 3,873 Less: Accumulated depreciation (2,422 ) (2,026 ) Total property and equipment, net $ 1,592 $ 1,847 Depreciation expense for the six months ended June 30, 2020 and 2019 was approximately $396,000 and $410,000, respectively. Depreciation expense for the six months ended June 30, 2020 excludes trademark amortization expense of approximately $6,000, and amortization of capitalized license expenses of approximately $133,000. During the six months ended June 30, 2019, the Company sold lab equipment with an acquisition cost of $319,000 and accumulated depreciation of approximately $138,000 and realized a loss of approximately $54,000. Depreciation expense for the three months ended June 30, 2020 and 2019 was approximately $202,000 and $205,000, respectively. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | 6 . Stock Option Valuation For stock options requiring an assessment of value during the six months ended June 30, 2020, the fair value of each stock option award was estimated using the Black-Scholes option-pricing model utilizing the following assumptions: June 30, 2020 Risk-free interest rate 0.54 to 1.56% Expected dividend yield 0% Expected volatility 98.0-99.6% Expected life 4.0 to 6.25 years June 30, 2019 Risk-free interest rate 1.94-2.59% Expected dividend yield 0% Expected volatility 82.0-94.0% Expected life 4.0 to 6.25 years A summary of stock option activity for the six months ended June 30, 2020 is as follows: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in Years) Stock options outstanding at December 31, 2019 4,793,253 $ 7.10 5.64 Granted 729,300 16.49 Exercised (276,622 ) 3.92 Cancelled (13,875 ) 10.97 Stock options outstanding at June 30, 2020 5,232,056 8.57 5.73 Stock options exercisable at June 30, 2020 2,653,979 $ 6.86 4.25 The Company recognized approximately $4,943,000 in stock-based compensation during the six months ended June 30, 2020, related to incentive stock option (“ISOs”) activity over the weighted average remaining period of 2.4 years. As of June 30, 2020, total unrecognized stock-based compensation was approximately $16,935,000, which is expected to be recognized as an operating expense in the Company’s consolidated statement of operations and other comprehensive loss through September 2023. During the three and six months ended June 30, 2020, the Company granted 1,200 ISO’s with an average grant date fair value of $20.77 and 729,300 ISO’s with an average grant date fair value of $13.03, respectively. During the three and six months ended June 30, 2019, the Company granted 35,000 ISOs with a weighted average exercise price of $8.09 and 809,600 ISOs with a weighted average exercise price of $6.33, respectively. The intrinsic value of exercisable but unexercised in-the-money stock options at June 30, 2020, was approximately $46,835,000, based on a fair value of $4.25 per share on June 30, 2020. Option Amendments- Modification of Incentive Stock Options During the six months ended June 30, 2020, the following event resulted in the amendment to terms of outstanding stock option awards: On January 22, 2020, an employee who had an employment agreement in place under which the employee was employed in a particular role and that prescribed certain separation benefits to the employee was separated from that role. Per the employment agreement, upon termination (i) all unvested stock options would accelerate and become vested as of the termination date, and (ii) the options would remain exercisable, to the extent applicable, following the date of termination for the period prescribed in the equity award plan. As of January 21, 2020, the terminated employee held outstanding options to purchase an aggregate of 215,000 shares of the Company's common stock at a weighted average exercise price of $4.00 per share, including unvested options to purchase 94,375 shares at a weighted average exercise price of $7.83 per share. On January 21, 2020 the unvested portion of the outstanding options vested and the post-employment option exercise period was extended from 90 days, as prescribed to the equity award plan, to 12 months from the date of the termination . In May 2020, the final separation agreement was amended to extend the post-employment option exercise period from 12 months to 36 months . The Company calculated the change in stock-based compensation cost associated with the previously described stock option modifications pursuant to the applicable guidance in FASB ASC 718, Compensation—Stock Compensation Restricted Stock Units On October 3, 2019, the Company granted 100,000 restricted stock units (“RSUs”) with time-based vesting conditions to an executive officer. During the year ended December 31, 2019, the Company awarded 100,000 RSUs at an average grant date fair value of $7.53 per share. The RSUs vest in three substantially equal installments beginning on grant date, and annually thereafter. Compensation expense is recognized on a straight-line basis. On February 5, 2020, the Company granted 150,000 RSUs with time-based vesting conditions to an executive officer. One-half of the RSUs vests on September 30, 2021, and the balance vests on March 31, 2022. On March 31, 2020, the Company granted 50,000 RSUs with time-based vesting conditions to an executive officer. The RSUs vest in three substantially equal installments beginning on grant date, and annually thereafter. Compensation expense is recognized on a straight-line basis. The following table summarizes the RSU activity under the 2016 Omnibus Incentive Plan for the six months ended June 30, 2020: Restricted Securities Number of Shares Weighted Average Grant Date Fair Value Per Share Nonvested balance as of December 31, 2019 66,667 $ 7.53 Granted 200,000 17.77 Vested/Released (16,666 ) 14.19 Forfeited Nonvested balance at June 30, 2020 250,001 $ 15.28 The Company recognized approximately $756,000 in stock-based compensation during the six months ended June 30, 2020, related to RSU activity. As of June 30, 2020, total unrecognized stock-based compensation was approximately $3,239,000, which is expected to be recognized as an operating expense in the Company’s consolidated statement of operations and other comprehensive loss through June 2022 with a weighted average remaining period of 1.62 years. During the three and six months ended June 30, 2020, the Company granted 0 and 200,000 RSUs with a weighted average grant date fair value per share of $17.77, respectively. The Company did not grant RSUs for the three and six months ended June 30, 2019. Stock-based Compensation Stock-based compensation for the three and six months ended June 30, 2020 and 2019 was included in the consolidated statement of operations and other comprehensive loss as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2020 2019 2020 2019 General and administrative $ 994 $ 402 $ 2,011 $ 962 Research and development 1,530 919 3,688 2,123 Total $ 2,524 $ 1,321 $ 5,699 $ 3,085 |
Warrants
Warrants | 6 Months Ended |
Jun. 30, 2020 | |
Warrants And Rights Note Disclosure [Abstract] | |
Warrants | 7 . Warrants The Company had two tranches of common stock warrants outstanding at June 30, 2020. The first tranche was exercisable for an aggregate of 370,370 shares of common stock and was issued on June 15, 2015 with an exercise price of $2.70 per share. These warrants were issued with a 7 year term and expire on June 15, 2022. The second tranche was exercisable for an aggregate of 882,071 shares of common stock and was issued on December 27, 2017 with an exercise price of $9.38 per share. These warrants were issued with a 5 year term and expire on December 26, 2022. The intrinsic value of exercisable but unexercised in-the-money common stock warrants at June 30, 2020 was approximately $13,530,500 based on a fair value of $24.51 per share on June 30, 2020. Each tranche of warrants was evaluated under ASC 480, Distinguishing Liabilities from Equity, and ASC 815, Derivatives and Hedging , and the Company determined that equity classification was appropriate. The following table summarizes common stock warrant activity for the six months ended June 30, 2020: Warrant Issued June 15, 2015- Tranche 1 Warrant Issued December 27, 2017- Tranche 2 Total Shares remaining to be issued as of December 31, 2019 322,259 867,568 1,189,827 Issued via cashless exercises (227,184 ) (50,995 ) (278,179 ) Withheld as payment to cover issued shares (22,464 ) (27,215 ) (49,679 ) Balance at June 30, 2020 72,611 789,358 861,969 |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2020 | |
Revenue From Contract With Customer [Abstract] | |
Revenue Recognition | 8 . Revenue Recognition The Company recognizes collaboration revenue under certain of the Company’s license or collaboration agreements that are within the scope of ASC 606. The Company’s contracts with customers typically include promises related to licenses to intellectual property and research and development services. If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenue from non-refundable, up-front fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgement to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. The Company’s contracts may include options to acquire additional goods and/or services. The terms of the Company’s arrangements with customers typically include the payment of one or more of the following: (i) Non-refundable, up-front payment, (ii) Development, regulatory and commercial milestone payments, (iii) Future options and (iv) Royalties on net sales of licensed products. Accordingly, the transaction price is generally comprised of a fixed fee due at contract inception and variable consideration in the form of milestone payments due upon the achievement of specified events and tiered royalties earned when customers recognize net sales of licensed products. The Company measures the transaction price based on the amount of consideration to which it expects to be entitled in exchange for transferring the promised goods and/or services to the customer. The Company utilizes the “most likely amount” method to estimate the amount of variable consideration, to predict the amount of consideration to which it will be entitled for its one open contract. Amounts of variable consideration are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. Milestone payments that are not within the control of the Company or the licensee, such as those dependent upon receipt of regulatory approval, are not considered to be probable of achievement until the triggering event occurs. At the end of each reporting period, the Company reevaluates the probability of achievement of each milestone and any related constraint, and if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenue and net loss in the period of adjustment. For arrangements that include sales-based royalties, including milestone payments based upon the achievement of a certain level of product sales, the Company recognizes revenue upon the later of: (i) When the related sales occur or (ii) When the performance obligation to which some or all of the payment has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized any development, regulatory or commercial milestones or royalty revenue resulting from any of its collaboration arrangements. Consideration that would be received for optional goods and/or services is excluded from the transaction price at contract inception. The Company allocates the transaction price to each performance obligation identified in the contract on a relative standalone selling price basis, when applicable. However, certain components of variable consideration are allocated specifically to one or more particular performance obligations in a contact to the extent both of the following criteria are met: (i) The terms of the payment relate specifically to the efforts to satisfy the performance obligation or transfer the distinct good or service and (ii) Allocating the variable amount of consideration entirely to the performance obligation or the distinct good or service is consistent with the allocation objective of the standard whereby the amount allocated depicts the amount of consideration to which the entity expects to be entitled in exchange for transferring the promised goods or services. The Company develops assumptions that require judgement to determine the standalone selling price for each performance obligation identified in each contract. The key assumptions utilized in determining the standalone selling price for each performance obligation may include forecasted revenues, development timelines, estimated research and development costs, discount rates, likelihood of exercise and probabilities of technical and regulatory success. Revenue is recognized based on the amount of the transaction price that is allocated to each respective performance obligation when or as the performance obligation is satisfied by transferring a promised good and/or service to the customer. For performance obligations that are satisfied over time, the Company recognizes revenue by measuring the progress toward complete satisfaction of the performance obligation using a single method of measuring progress which depicts the performance in transferring control of the associated goods and/or services to the customer. The Company uses input methods to measure the progress toward the complete satisfaction of performance obligations satisfied over time. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenue and net loss in the period of adjustment. The Company measures progress toward satisfaction of the performance obligation overtime as effort is expended. As it relates to the Collaboration The Company does not believe that any variable consideration should be included in the transaction price at June 30, 2020. Such assessment considered the application of the constraint to ensure that estimates of variable consideration would be included in the transaction price only to the extent the Company had a high degree of confidence that revenue would not be reversed in a subsequent reporting period. The Company will re-evaluate the transaction price, including the estimated variable consideration included in the transaction price and all constrained amounts, in each reporting period and as other changes in circumstances occur. For the three months ended June 30, 2020 and 2019, the Company recorded approximately $118,000 and $700,000, respectively in collaboration revenue related to this agreement. For the six months ended June 30, 2020 and 2019, the Company recorded approximately $173,000 and $700,000, respectively in collaboration revenue related to this agreement. As of June 30, 2020 and December 31, 2019, the Company recorded short and long-term research and development liabilities on its balance sheet dated of approximately $310,500 and $0, respectively. On November 6, 2018, the Company entered into a Collaboration Agreement with LG Chem Life Sciences (“LG Chem”) related to the development of the Company’s Immuno-STATs focused in the field of oncology. Pursuant to the Collaboration Agreement the Company granted LG Chem an exclusive license to develop, manufacture and commercialize the Company’s lead product, CUE-101, as well as Immuno-STATs that target T-cells against two additional cancer antigens, in certain Asian countries (collectively, the “LG Chem Territory”). LG Chem has the option to elect one additional Immuno-STAT for an oncology target within two years of the agreement for a worldwide development and commercialization license, and Cue Biopharma will retain an option to co-develop and co-commercialize the additional program worldwide. Cue Biopharma retains rights to develop and commercialize all assets included in the agreement in the United States and in global markets outside of Asia. In exchange for the licenses and other rights granted to LG Chem under the Collaboration Agreement, LG Chem made a $5.0 million equity investment in common stock of Cue Biopharma, Inc. and a $5.0 million nonrefundable upfront cash payment. Cue Biopharma is also eligible to receive up to an additional $400 million in research, development, regulatory and sales milestones. In addition, the Collaboration Agreement also provides that LG Chem will pay the Company tiered single-digit percentage royalties on net sales of commercialized product candidates in the LG Chem Territory. On May 16, 2019, LG Chem paid the Company a $2.5 million milestone payment for the United States Food and Drug Administration (“FDA”) acceptance of the Investigational New Drug (“IND”) for the Company’s lead drug candidate, CUE-101, pursuant to the LG Chem Agreement. The $2.5 million milestone payment was recorded as a contract liability upon receipt of payment as it requires deferral of revenue recognition to a future period until the Company performs its obligations under the arrangement. Of the $2.5 million milestone payment, approximately $412,500 was recognized as tax withholding, shown as income tax expense on the statement of operations and comprehensive loss. The Company recorded short and long-term research and development liabilities on its balance sheet of approximately $4,953,000 and $2,154,000, respectively, as of June 30, 2020. Aside from the $2.5 million milestone payment, the Company does not believe that any variable consideration should be included in the transaction price as of June 30, 2020. Such assessment considered the application of the constraint to ensure that estimates of variable consideration would be included in the transaction price only to the extent the Company had a high degree of confidence that revenue would not be reversed in a subsequent reporting period. The Company will re-evaluate the transaction price, including the estimated variable consideration included in the transaction price and all constrained amounts, in each reporting period and as other changes in circumstances occur. For the three and six months ended June 30, 2020, the Company recognized revenue of approximately $957,000 and approximately $1,802,000, respectively, related to this agreement. For the three and six months ended June 30, 2019, the Company recognized revenue of approximately $725,000. The Company considered the capitalization of contract costs under the guidance in ASC 340-40, Other Assets and Deferred Costs: Contracts with Customers elated to the LG Chem agreement. As of December 31, 2019, $264,503 was included in prepaid expenses and other short-term assets and $260,497 is included in other long-term assets. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9 . Einstein License Agreement In 2015, the Company entered into the Einstein License with Einstein for certain patent rights relating to the Company’s core technology platform for the engineering of biologics to control T-cell activity, precision, immune-modulatory drug candidates, and two supporting technologies that enable the discovery of costimulatory signaling molecules (ligands) and T-cell targeting peptides. On July 31, 2017, the Company entered into an amended and restated license agreement which modified certain obligations of the parties under the Einstein License. For the three and six months ended June 30, 2020, the Company incurred approximately The Company’s remaining commitments with respect to the Einstein License are based on the attainment of future milestones. The aggregate amount of milestone payments made under the Einstein License may equal up to $1.85 million for each product, process or service that use the patents covered by the Einstein License, including certain technology received from Einstein relating thereto (“Licensed Products”), and up to $1.85 million for each new indication of a Licensed Product. Additionally, the aggregate amount of one-time milestone payments based on cumulative sales of all Licensed Products may equal up to $5.75 million. Collaboration Agreement with Merck On November 14, 2017, the Company entered into the Collaboration Agreement with Merck for a partnership to research and develop certain of the Company’s proprietary biologics that target certain autoimmune disease indications (the “Initial Indications”). We view this Collaboration Agreement as a component of our development strategy since it will allow us to advance our autoimmune programs in partnership with a world class pharmaceutical company, while also continuing our focus on our more advanced cancer programs. The research program outlined in the Collaboration Agreement entails (1) our research, discovery and development of certain Immuno-STAT™ drug candidates up to the point of demonstration of certain biologically relevant effects (“Proof of Mechanism”) and (2) the further development by Merck of the Immuno-STAT™ drug candidates that have demonstrated Proof of Mechanism (the “Proposed Product Candidates”) up to the point of demonstration of all or substantially all of the properties outlined in such Proposed Product Candidates’ profiles as described in the Collaboration Agreement. In exchange for the licenses and other rights granted to Merck under the Collaboration Agreement, Merck paid to the Company a $2.5 million nonrefundable up-front payment. Additionally, the Company may be eligible to receive funding in developmental milestone payments, as well as tiered royalties, if all research, development, regulatory and commercial milestones agreed upon by both parties are successfully achieved. Excluding the up-front payment described above, the Company is eligible to earn up to $ 101 million for the achievement of certain research and development milestones, $ 120 million for the achievement of certain regulatory milestones and $ 150 million for the achievement of certain commercial milestones, in addition to tiered royalties on sales, if all pre-specified milestones associated with multiple products across the primary disease indication areas are achieved. The Collaboration Agreement requires the Company to use the first $ million of milestone payments we receive under the agreement to fund contract research. The amount of the royalty payments is a percentage of product sales ranging in the single digits based on the amount of such sales. Collaboration Agreement with LG Chem Life Sciences On November 6, 2018, the Company entered into a Collaboration Agreement with LG Chem related to the development of the Company’s Immuno-STATs focused in the field of oncology. Pursuant to the Collaboration Agreement the Company granted LG Chem an exclusive license to develop, manufacture and commercialize the Company’s lead product, CUE-101, as well as Immuno-STATs that target T-cells against two additional cancer antigens, in certain Asian countries (collectively, the “LG Chem Territory”). LG Chem has the option to elect one additional Immuno-STAT for an oncology target within two years of the agreement for a worldwide development and commercialization license, and Cue Biopharma will retain an option to co-develop and co-commercialize the additional program worldwide. Cue Biopharma retains rights to develop and commercialize all assets included in the agreement in the United States and in global markets outside of Asia. In exchange for the licenses and other rights granted to LG Chem under the Collaboration Agreement, LG Chem made a $5.0 million equity investment in common stock of Cue Biopharma, Inc. and a $5.0 million nonrefundable upfront cash payment. Cue Biopharma is also eligible to receive up to an additional $400 million in research, development, regulatory and sales milestones. In addition, the Collaboration Agreement also provides that LG Chem will pay the Company tiered single-digit royalties on net sales of commercialized product candidates in the LG Chem Territory. On May 16, 2019, LG Chem paid the Company a $2.5 million milestone payment for the FDA acceptance of the IND for the Company’s lead drug candidate, CUE-101, pursuant to the LG Chem Agreement. The $2.5 million milestone payment was recorded as a contract liability upon receipt of payment as it requires deferral of revenue recognition to a future period until the Company performs its obligations under the arrangement pursuant to the Company’s revenue recognition policy. Contingencies The Company accrues for contingent liabilities to the extent that the liability is probable and estimable. There are no accruals for contingent liabilities in these consolidated financial statements. The Company may be subject to various legal proceedings from time to time as part of its business. As of June 30, 2020, the Company was not a party to any legal proceedings or threatened legal proceedings, the adverse outcome of which, individually or in the aggregate, would have a material adverse effect on its business, financial condition or results of operations. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2020 | |
Leases [Abstract] | |
Leases | 1 0 . Leases The Company leases approximately 19,900 square feet of office space in Cambridge, Massachusetts under a lease that began in May 2018 The Company adopted ASC 842 as of January 1, 2019 using the effective date method, in which we did not restate prior periods. Upon adoption, the Company elected the package of practical expedients permitted under the transition guidance within ASC 842, which among other things, allowed it to carry forward the historical lease classification. The Company does not allocate consideration in its leases to lease and non-lease components and does not record leases on its balance sheets with terms of 12 months or less. The Company uses its estimated incremental borrowing rate, which is derived from information available at the lease commencement date, in determining the present value of lease payments. The Company’s incremental borrowing rate represents the rate of interest that it would have to pay to borrow over a similar term an amount equal to the lease payments in a similar economic environment. The adoption of ASC 842 on January 1, 2019 resulted in the recognition of approximately $9,692,000 of right-of-use asset and $9,347,000 of lease liabilities on the Company’s balance sheet. The adoption did not have a material net impact on the Company’s consolidated statements of operations or accumulated deficit. The Company will review the classification of newly entered leases as either an operating or a finance lease and recognize a related right-of-use asset and lease liability on its balance sheet upon commencement. On January 18, 2018, the Company entered into an operating lease agreement for its laboratory and office space in Cambridge, Massachusetts for the period from May 1, 2018 through April 30, 2021. The lease contains escalating payments during the lease period. Upon execution of this lease agreement the Company prepaid three months of rent, two of which will be held in escrow and credited against future rent payments and one month that was applied to the first months rent. The Company also prepaid seven and one half months rent pursuant to an amendment to the lease agreement executed on June 18, 2018. These amounts were recorded to deposits and prepaid expenses, respectively at December 31, 2018. The monthly rent payments due under this lease agreement will be approximately $297,500 for the first 18 months of the term and increase to approximately $330,500 for the remaining 18 months of the term. On June 18, 2018, the Company entered into an amended lease agreement that provided the Company with a reduction in rental fees for its office and laboratory space in exchange for prepayment of a portion of the fees. This amendment was effective beginning on May 15, 2018 and expires on April 14, 2021. On September 20, 2018, the Company entered into an operating lease for additional laboratory space in Cambridge, Massachusetts for the period from October 15, 2018 through April 14, 2021 (the “Additional Laboratory Lease”). The lease contains escalating payments during the lease period. The monthly rental rate under the is $72,600 for the first 12 months and $78,600 for the remainder of the term. Upon execution of this lease agreement the Company prepaid twelve months rent pursuant to the lease agreement executed on September 20, 2018. As of June 30, 2020 and December 31, 2019, a security deposit of approximately $177,000 is included in deposits on the Company’s balance sheet. On September 16, 2019, the Company entered into an amendment to the Additional Laboratory Lease Additional Laboratory Lease On June 24, 2020, the “Company entered into a second amendment to the Laboratory and Office Lease. Pursuant to the amendment (1) the term of the lease was extended to June 14, 2022 and (2) the monthly rental rate for the last 14 months of the lease term was increased to $375,174. Company recorded an adjustment to the right-of-use asset and lease liability in the amount of approximately $4,826,000. At June 30, 2020, the Company recorded approximately $8,150,000 to operating right-of-use asset, and approximately $4,249,000 and $4,182,000 to short and long-term operating lease liability, respectively. At June 30, 2020 the remaining lease term was 1.96 years. At December 31, 2019, the Company recorded approximately $5,337,000 to operating right-of-use asset, and approximately $4,448,000 and $1,348,000 to short and long-term operating lease liability, respectively. At December 31, 2019 the remaining lease term was 1.29 years. Future minimum lease payments under these leases at June 30, 2020 are as follows: Year (in thousands) 2020 2,337 2021 4,552 2022 2,064 Total lease payment $ 8,953 Less: present value discount (522 ) Total $ 8,431 Total rent expense of approximately $1,080,000 and $1,137,000 was included in the consolidated statement of operations and comprehensive loss for the three months ended June 30, 2020 and 2019, respectively, and $2,160,000 and $2,274,000 for the six months ended June 30, 2020 and 2019, respectively. Other information pertaining to the Company’s operating leases for the three and six months ended June 30, 2020 summarized in the table below. Other information (in thousands) Three Months Ended June 30, 2020 Six Months Ended June 30, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 893 $ 893 Operating lease cost $ 1,080 $ 2,160 Weighted average discount rate 6.0% 6.0% Weighted average remaining lease term 1.96 years 1.96 years The Company recorded a right of use asset of approximately $8,150,000 and lease liability of approximately $8,431,000 at June 30, 2020. The change in the right of use asset and lease liability is due to rental expense of approximately $1,080,000 and $2,160,000, recorded during the three and six months ended June 30, 2020, respectively. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 1 1 . Subsequent Events In June 2020, the Company entered into the June 2020 ATM Agreement with Stifel to sell shares of the Company’s common stock for aggregate gross proceeds of up to $40 million, from time to time, through an “at-the-market” equity offering program Subsequent to June 30, 2020 we sold 150,000 shares of common stock under the this ATM Agreement for proceeds of approximately $3.2 million, net of commissions paid, but excluding estimated transaction expenses. As of August 3, 2020, aggregate sales under the June 2020 ATM Agreement totaled 500,000 shares of common stock sold for approximately $11.3 million, net of commissions paid, but excluding estimated transaction expenses. On July 15, 2020, the Company filed a Certificate of Amendment (the “Certificate of Amendment”) to its Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware effecting an amendment to increase the number of authorized shares of the Company’s common stock from 50,000,000 shares to 100,000,000 shares. The Certificate of Amendment was approved by the Company’s stockholders at the Company’s 2020 annual meeting on July 9, 2020. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements as of June 30, 2020, and for the three and six months ended June 30, 2020, and 2019, have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) and Generally Accepted Accounting Principles in the United States (“U.S. GAAP”) for financial information, which prescribes elimination of all significant intercompany accounts and transactions in the accounts of the Company and its wholly owned subsidiary, Cue Biopharma Securities Corporation, Inc., which was formed in December 2018 and incorporated in the Commonwealth of Massachusetts. In the opinion of management, these financial statements reflect all adjustments which are necessary for a fair statement of the Company’s financial position and results of its operations, as of and for the periods presented Interim results for the three and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020, or any future periods. |
Public Offerings | Public Offerings In March 2020, the Company entered into an “at-the-market” (ATM) equity offering sales agreement (the “March 2020 ATM Agreement”) with Stifel Nicolaus & Company, Inc. (“Stifel”) to sell shares of the Company’s common stock for aggregate gross proceeds of up to $35 million, from time to time, through an ATM equity offering program under which Stifel acted as sales agent. As of June 30, 2020, the Company had sold 1,824,901 shares of common stock under the March 2020ATM Agreement for proceeds of approximately $34.3 million, net of commissions paid, but excluding estimated transaction expenses. Due to the issuance and sale of all the shares of common stock subject thereto, the March 2020 sales agreement terminated in accordance with its terms. . In June 2020, the Company entered into another ATM equity offering sales agreement with Stifel (the “June 2020 ATM Agreement”) to sell shares of the Company’s common stock for aggregate gross proceeds of up to $40 million, from time to time, through an ATM equity offering program under which Stifel acts as sales agent. The sales agreement will terminate upon the earliest of (a) the sale of $40 million of shares of the Company’s common stock or (b) the termination of the sales agreement by the Company or Stifel. As of June 30, 2020, the Company had sold 350,000 shares of common stock under the June 2020 sales agreement for proceeds of approximately $8.1 million, net of commissions paid, but excluding estimated transaction expenses. Refer to Note 11 Subsequent Events for sales subsequent to June 30, 2020. |
Consolidation | Consolidation The accompanying consolidated financial statements include the Company and its wholly owned subsidiary, Cue Biopharma Securities Corporation, Inc. The Company has eliminated all intercompany transactions. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Significant estimates include estimates related to collaboration revenue, the accounting for potential liabilities and accrued expenses, the assumptions utilized in valuing stock-based compensation issued for services, the realization of deferred tax assets, and the useful life with respect to long-lived assets and intangibles. Actual results could differ from those estimates. The COVID-19 outbreak, which the World Health Organization has classified as a pandemic, has prompted governments and regulatory bodies throughout the world to issue “stay-at-home” or similar orders, and enact restrictions on the performance of “non-essential” services, public gatherings and travel. The extent to which COVID-19 impacts the Company’s business and financial results will depend on numerous evolving factors including, but not limited to: the magnitude and duration of COVID-19, the extent to which it will impact worldwide macroeconomic conditions, the speed of the anticipated recovery, access to capital markets, and governmental and business reactions to the pandemic. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts of COVID-19 as of June 30, 2020 and through the date of the filing of this Quarterly Report on Form 10-Q. The accounting matters assessed included, but were not limited to estimates related to collaboration revenue, the accounting for potential liabilities and accrued expenses, the assumptions utilized in valuing stock-based compensation issued for services, the realization of deferred tax assets, and assessments of impairment related to long-lived assets and intangibles. The Company’s future assessment of the magnitude and duration of COVID-19, as well as other factors, could result in additional material impacts to the Company’s consolidated financial statements in future reporting periods. Despite the Company’s efforts, the ultimate impact of COVID-19 depends on factors beyond the Company’s knowledge or control, including the duration and severity of the outbreak, as well as third-party actions taken to contain its spread and mitigate its public health effects. As a result, the Company is unable to estimate the extent to which COVID-19 will negatively impact its financial results or liquidity. |
Cash Concentrations | Cash Concentrations The Company maintains its cash balances with a financial institution in federally insured accounts and may periodically have cash balances in excess of insurance limits. The Company maintains its accounts with a financial institution with a high credit rating. The Company has not experienced any losses to date and believes that it is not exposed to any significant credit risk on cash. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less at the date of purchase to be cash equivalents. The Company currently invests available cash in money market funds. |
Marketable Securities | Marketable Securities Marketable securities consist of investments with original maturities greater than ninety days and less than one year from the balance sheet date. The Company classifies all of its investments as available-for-sale securities. Accordingly, these investments are recorded at fair value, which is based on quoted market prices. Unrealized gains and losses are recognized and determined on a specific identification basis and are included in other comprehensive loss. Realized gains and losses are determined on a specific identification basis and are included in other income (loss) on the income statement. Amortization and accretion of discounts and premiums is recorded in interest income. The Company has invested available cash in United States Treasury obligations. |
Restricted Cash | Restricted Cash The Company had $150,000 in restricted cash deposited with a commercial bank to collateralize a credit card as of June 30, 2020 and December 31, 2019. |
Property and Equipment | Property and Equipment Property and equipment is recorded at cost. Major improvements are capitalized, while maintenance and repairs are charged to expense as incurred. Gains and losses from disposition of property and equipment are included in income and expense when realized. Amortization of leasehold improvements is provided using the straight-line method over the shorter of the lease term or the useful life of the underlying assets. Depreciation of property and equipment is provided using the straight-line method over the following estimated useful lives: Laboratory equipment 5 years Computer and office equipment 3 years Furniture and fixtures 3-8 years The Company recognizes depreciation and amortization expense in general and administrative expenses and in research and development expenses in the Company’s statements of operations, depending on how each category of property and equipment is utilized in the Company’s business activities. |
Trademark | Trademark Trademark consists of the Company’s right, title and interest to the CUE BIOLOGICS Mark, and any derivative mark incorporating CUE, throughout the world, together with all associated goodwill and common law rights appurtenant thereto, including, but not limited to, any right, title and interest in any corporate name, company name, business, name, trade name, dba, domain name, or other source identifier incorporating CUE. The Company has classified the trademark as a component of other long-term assets, having a useful life of 14 years at June 30, 2020 |
Revenue Recognition | Revenue Recognition The Company recognizes collaboration revenue under certain of the Company’s license or collaboration agreements that are within the scope of ASC 606. The Company’s contracts with customers typically include promises related to licenses to intellectual property and research and development services. If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenue from non-refundable, up-front fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgement to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. Accordingly, the transaction price is generally comprised of a fixed fee due at contract inception and variable consideration in the form of milestone payments due upon the achievement of specified events and tiered royalties earned when customers recognize net sales of licensed products. The Company measures the transaction price based on the amount of consideration to which it expects to be entitled in exchange for transferring the promised goods and/or services to the customer. The Company utilizes the “most likely amount” method to estimate the amount of variable consideration, to predict the amount of consideration to which it will be entitled for its one open contract. Amounts of variable consideration are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. At the inception of each arrangement that includes development and regulatory milestone payments, the Company evaluates whether the associated event is considered probable of achievement and estimates the amount to be included in the transaction price using the most likely amount method. Currently, the Company has one contract with an option to acquire additional goods and/or services in the form of additional research and development services for additional product candidates which it evaluated and determined was not a material right related to such agreement and so was not included in the transaction price. |
Research and Development Expenses | Research and Development Expenses Research and development expenses consist primarily of compensation costs, fees paid to consultants, outside service providers and organizations (including research institutes at universities), facility costs, and development and clinical trial costs with respect to the Company’s product candidates. Research and development expenses incurred under contracts are expensed ratably over the life of the underlying contracts, unless the achievement of milestones, the completion of contracted work, or other information indicates that a different pattern of performance is more appropriate. Other research and development expenses are charged to operations as incurred. Nonrefundable advance payments are recognized as an expense as the related services are performed. The Company evaluates whether it expects the services to be rendered at each quarter end and year end reporting date. If the Company does not expect the services to be rendered, the advance payment is charged to expense. Nonrefundable advance payments for research and development services are included in prepaid and other current assets on the balance sheet. To the extent that a nonrefundable advance payment is for contracted services to be performed within 12 months from the reporting date, such advance is included in current assets; otherwise, such advance is included in non-current assets. The Company evaluates the status of its research and development agreements and contracts, and the carrying amount of the related assets and liabilities, at each quarter end and year end reporting date, and adjusts the carrying amounts and their classification on the balance sheet as appropriate. |
Patent Expenses | Patent Expenses The Company is the exclusive worldwide licensee of, and has patent applications pending for, numerous domestic and foreign patents. Due to the significant uncertainty associated with the successful development of one or more commercially viable product candidates based on the Company’s research efforts and any related patent applications, all patent costs, including patent-related legal fees, filing fees and other costs are charged to expense as incurred. For the three and six months ended June 30, 2020, patent expenses were $686,000 and $1,340,000, respectively. For the three and six months ended June 30, 2019, patent expenses were $277,000 and $846,000, respectively. Patent expenses are included in general and administrative expenses in the Company’s statements of operations. |
Licensing Fees and Costs | Licensing Fees and Costs Licensing fees and costs consist primarily of costs relating to the acquisition of the Company’s license agreement with the Albert Einstein College of Medicine (“Einstein”), including related royalties, maintenance fees, milestone payments and product development costs. Licensing fees and costs are charged to expense as incurred. |
Long-Lived Assets | Long-Lived Assets The Company reviews long-lived assets, consisting of property and equipment, for impairment at each fiscal year end or when events or changes in circumstances indicate the carrying value of these assets may exceed their current fair values. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the assets. Assets to be disposed of are separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell and are no longer depreciated. The Company has not historically recorded any impairment to its long-lived assets. In the future, if events or market conditions affect the estimated fair value to the extent that a long-lived asset is impaired, the Company will adjust the carrying value of these long-lived assets in the period in which the impairment occurs. During the three and six months ended June 30, 2020, there were no disposals of property and equipment. |
Leases | Leases In February 2016, the FASB issued ASU 2016-02, Leases The standard permits two transition methods, (1) to apply the new lease requirements at the beginning of the earliest period presented, or (2) to apply the new lease requirements at the effective date. The Company adopted ASC 842 as of January 1, 2019 using the effective date method, in which we did not restate prior periods. Upon adoption, the Company elected the package of practical expedients permitted under the transition guidance within ASC 842, which among other things, allowed it to carry forward the historical lease classification. The adoption of ASC 842 on January 1, 2019 resulted in the recognition of approximately $9,692,000 of right-of-use asset and $9,347,000 of lease liabilities on the Company’s balance sheet. The adoption did not have a material net impact on the Company’s consolidated statements of operations or accumulated deficit. Please refer to Note 10 for more detail. |
Stock-Based Compensation | Stock-Based Compensation The Company periodically issues stock based awards to officers, directors, employees, Scientific and Clinical Advisory Board members, non-employees and consultants for services rendered. Such issuances vest and expire according to terms established at the issuance date. Stock-based payments to officers, directors, members of the Company’s Scientific and Clinical Advisory Board, non-employees and outside consultants and employees, including grants of employee stock options, are recognized in the financial statements based on their grant date fair values. Stock option grants, which are generally time-vested, are measured at the grant date fair value and charged to operations on a straight-line basis over the service period, which generally approximates the vesting term. The Company also grants performance-based awards periodically to officers of the Company. The Company recognizes compensation costs related to performance awards over the requisite service period if and when the Company concludes that it is probable that the performance condition will be achieved. The fair value of stock options and restricted stock units is determined utilizing the Black-Scholes option-pricing model, which is affected by several variables, including the risk-free interest rate, the expected dividend yield, the life of the equity award, the exercise price of the stock option as compared to the fair value of the common stock on the grant date, and the estimated volatility of the common stock over the term of the equity award. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. Until the Company has established a trading market for its common stock, estimated volatility is based on the average historical volatilities of comparable public companies in a similar industry. The expected dividend yield is based on the current yield at the grant date; the Company has never declared or paid dividends and has no plans to do so for the foreseeable future. As permitted by Staff Accounting Bulletin No. 107, due to the Company’s lack of trading history and option activity, management utilizes the simplified method to estimate the expected term of options at the date of grant. The exercise price is determined based on the fair value of the Company’s common stock at the date of grant. The Company accounts for forfeitures as they occur. The Company recognizes the fair value of stock-based compensation in general and administrative expenses and in research and development expenses in the Company’s statements of operations, depending on the type of services provided by the recipient of the equity award. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Components of comprehensive income or loss, including net income or loss, are reported in the financial statements in the period in which they are recognized. Other comprehensive income or loss is defined as the change in equity during a period from transactions and other and other events and circumstances from non-owner sources. Net income (loss) and other comprehensive income (loss) are reported net of any related tax effect to arrive at comprehensive income (loss). Comprehensive income (loss) includes net income (loss) as well as changes in stockholders’ equity that result from transactions and economic events other than those with stockholders. The Company’s only element of other comprehensive income (loss) in all periods presented was unrealized gain or loss on available-for-sale securities. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share The Company’s computation of earnings (loss) per share (“EPS”) for the respective periods includes basic and diluted EPS. Basic EPS is measured as the income (loss) attributable to common stockholders divided by the weighted average number of common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares that would result from the exercise of outstanding stock options and warrants as if they had been exercised at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. Basic and diluted loss per common share is the same for all periods presented because all outstanding stock options and warrants are anti-dilutive. At June 30, 2020, the Company excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from its calculation of earnings per share, as their effect would have been anti-dilutive. June 30, 2020 2019 Common stock warrants 861,969 1,252,441 Common stock options 5,482,057 4,811,378 Total 6,344,026 6,063,819 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The authoritative guidance with respect to fair value established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels and requires that assets and liabilities carried at fair value be classified and disclosed in one of three categories, as presented below. Level 1. Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability to access as of the measurement date. Financial assets and liabilities utilizing Level 1 inputs include active-exchange traded securities and exchange-based derivatives. Level 2. Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange-based derivatives, mutual funds, and fair-value hedges. Level 3. Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity to develop its own assumptions. Financial assets and liabilities utilizing Level 3 inputs include infrequently traded non-exchange-based derivatives and commingled investment funds and are measured using present value pricing models. The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end. The Company had approximately $32,687,000 in cash equivalents and $25,179,000 in short-term marketable securities that were measured and recorded at fair value on the Company’s balance sheet as of June 30, 2020. The Company had approximately $39,304,000 in cash equivalents and $15,120,000 in short-term marketable securities that were measured and recorded at fair value on the Company’s balance sheet as of December 31, 2019. The carrying value of financial instruments (consisting of cash, a certificate of deposit, accounts payable, accrued compensation and accrued expenses) is considered to be representative of their respective fair values due to the short-term nature of those instruments. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the FASB issued Accounting Standard Update (ASU) No. 2016-13 , Financial Instruments- Credit Losses: Measurement of Credit Losses on Financial Instruments The new standard requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. annual reporting period for smaller reporting companies. T he Company is still evaluating the impact of ASU 2016-13 on the Company’s consolidated financial statements; however, it does not expect the impact to be material. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Summary of Estimated Useful Lives of Assets | Depreciation of property and equipment is provided using the straight-line method over the following estimated useful lives: Laboratory equipment 5 years Computer and office equipment 3 years Furniture and fixtures 3-8 years |
Schedule of Anti-dilutive Securities Excluded from Computation of Earnings Per Share | At June 30, 2020, the Company excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from its calculation of earnings per share, as their effect would have been anti-dilutive. June 30, 2020 2019 Common stock warrants 861,969 1,252,441 Common stock options 5,482,057 4,811,378 Total 6,344,026 6,063,819 |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Assets Measured on Recurring Basis | The following table presents information about the Company’s assets that are measured at fair value on a recurring basis as of June 30, 2020 and December 31, 2019, and indicate the level of the fair value hierarchy utilized to determine such fair value: Fair Value Measurements as of June 30, 2020 (in thousands) Level 1 Level 2 Level 3 Fair Value Cash equivalents $ 32,687 $ — $ — $ 32,687 Marketable securities — 25,179 — 25,179 Total $ 32,687 $ 25,179 $ — $ 57,866 Fair Value Measurements as of December 31, 2019 (in thousands) Level 1 Level 2 Level 3 Fair Value Cash equivalents $ 39,304 $ — $ — $ 39,304 Marketable securities — 15,120 — 15,120 Total $ 39,304 $ 15,120 $ — $ 54,424 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Investments Debt And Equity Securities [Abstract] | |
Schedule of Fair Value of Available-for-Sale Marketable Securities | As of June 30, 2020 and December 31, 2019, the fair value of available-for-sale marketable securities by type of security was as follows: June 30, 2020 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. Treasury Securities $ 25,025 $ 155 $ — $ 25,179 $ 25,025 $ 155 $ — $ 25,179 December 31, 2019 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. Treasury Securities $ 15,130 $ — $ (10 ) $ 15,120 $ 15,130 $ — $ (10 ) $ 15,120 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Property Plant And Equipment [Abstract] | |
Summary of Property and Equipment | Property and equipment as of June 30, 2020 and December 31, 2019 consisted of the following: June 30, 2020 December 31, 2019 (in thousands) Computer equipment $ 268 $ 192 Laboratory equipment 3,653 3,588 Furniture and fixtures 93 93 4,014 3,873 Less: Accumulated depreciation (2,422 ) (2,026 ) Total property and equipment, net $ 1,592 $ 1,847 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Schedule of Estimated Fair Value of Each Stock Option Award | For stock options requiring an assessment of value during the six months ended June 30, 2020, the fair value of each stock option award was estimated using the Black-Scholes option-pricing model utilizing the following assumptions: June 30, 2020 Risk-free interest rate 0.54 to 1.56% Expected dividend yield 0% Expected volatility 98.0-99.6% Expected life 4.0 to 6.25 years June 30, 2019 Risk-free interest rate 1.94-2.59% Expected dividend yield 0% Expected volatility 82.0-94.0% Expected life 4.0 to 6.25 years |
Summary of Stock Option Activity | A summary of stock option activity for the six months ended June 30, 2020 is as follows: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in Years) Stock options outstanding at December 31, 2019 4,793,253 $ 7.10 5.64 Granted 729,300 16.49 Exercised (276,622 ) 3.92 Cancelled (13,875 ) 10.97 Stock options outstanding at June 30, 2020 5,232,056 8.57 5.73 Stock options exercisable at June 30, 2020 2,653,979 $ 6.86 4.25 |
Schedule of Stock-Based Compensation Included in Statement of Operations | Stock-based compensation for the three and six months ended June 30, 2020 and 2019 was included in the consolidated statement of operations and other comprehensive loss as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2020 2019 2020 2019 General and administrative $ 994 $ 402 $ 2,011 $ 962 Research and development 1,530 919 3,688 2,123 Total $ 2,524 $ 1,321 $ 5,699 $ 3,085 |
2016 Omnibus Incentive Plan | |
Schedule of Nonvested Restricted Stock Units Activity | The following table summarizes the RSU activity under the 2016 Omnibus Incentive Plan for the six months ended June 30, 2020: Restricted Securities Number of Shares Weighted Average Grant Date Fair Value Per Share Nonvested balance as of December 31, 2019 66,667 $ 7.53 Granted 200,000 17.77 Vested/Released (16,666 ) 14.19 Forfeited Nonvested balance at June 30, 2020 250,001 $ 15.28 |
Warrants (Table)
Warrants (Table) | 6 Months Ended |
Jun. 30, 2020 | |
Warrants And Rights Note Disclosure [Abstract] | |
Summary of Common Stock Warrant Activity | The following table summarizes common stock warrant activity for the six months ended June 30, 2020: Warrant Issued June 15, 2015- Tranche 1 Warrant Issued December 27, 2017- Tranche 2 Total Shares remaining to be issued as of December 31, 2019 322,259 867,568 1,189,827 Issued via cashless exercises (227,184 ) (50,995 ) (278,179 ) Withheld as payment to cover issued shares (22,464 ) (27,215 ) (49,679 ) Balance at June 30, 2020 72,611 789,358 861,969 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Leases [Abstract] | |
Schedule of Future Minimum Lease Payments for Operating Lease | Future minimum lease payments under these leases at June 30, 2020 are as follows: Year (in thousands) 2020 2,337 2021 4,552 2022 2,064 Total lease payment $ 8,953 Less: present value discount (522 ) Total $ 8,431 |
Schedule of Other Information of Operating Leases | Other information pertaining to the Company’s operating leases for the three and six months ended June 30, 2020 summarized in the table below. Other information (in thousands) Three Months Ended June 30, 2020 Six Months Ended June 30, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 893 $ 893 Operating lease cost $ 1,080 $ 2,160 Weighted average discount rate 6.0% 6.0% Weighted average remaining lease term 1.96 years 1.96 years |
Organization and Basis of Pre_2
Organization and Basis of Presentation - Additional Information (Details) | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Date of incorporation | Dec. 31, 2014 |
Cash, cash equivalents and marketable securities | $ 84,928,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Jan. 01, 2019 | |
Summary Of Significant Accounting Policies [Line Items] | ||||||
Proceeds from sale of common stock | $ 42,353,000 | $ 3,715,000 | ||||
Restricted cash used to collateralize a credit card | $ 150,000 | 150,000 | $ 150,000 | |||
Disposals of property and equipment | 0 | 0 | ||||
Operating lease, right-of-use asset | 8,150,000 | 8,150,000 | 5,337,000 | |||
Operating lease, liability | 8,431,000 | 8,431,000 | ||||
Cash equivalents | 32,687,000 | 32,687,000 | 39,304,000 | |||
Short-term marketable securities | 25,179,000 | 25,179,000 | 15,120,000 | |||
ASU 2016-02 | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Operating lease, right-of-use asset | 8,150,000 | 8,150,000 | $ 5,337,000 | $ 9,692,000 | ||
Operating lease, liability | $ 9,347,000 | |||||
General and Administrative Expense | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Patent expenses | $ 686,000 | $ 277,000 | $ 1,340,000 | $ 846,000 | ||
Type of Cost, Good or Service [Extensible List] | us-gaap:LicenseMember | us-gaap:LicenseMember | us-gaap:LicenseMember | us-gaap:LicenseMember | ||
Trademarks | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Useful life of trademark | 14 years | |||||
Accumulated amortization of intangible assets | $ 17,500 | $ 17,500 | ||||
Amortization of intangible assets | 2,916,000 | $ 2,916,000 | $ 5,833,000 | $ 5,833,000 | ||
Stifel Nicolaus and Company Inc. | March 2020 ATM Agreement | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Proceeds from sale of common stock, shares | 1,824,901 | |||||
Proceeds from sale of common stock | 34,300,000 | $ 34,300,000 | ||||
Stifel Nicolaus and Company Inc. | March 2020 ATM Agreement | Maximum | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Proceeds from sale of common stock | $ 35,000,000 | |||||
Stifel Nicolaus and Company Inc. | Sales Agreement June 2020 | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Proceeds from sale of common stock, shares | 350,000 | |||||
Proceeds from sale of common stock | $ 8,100,000 | $ 8,100,000 | ||||
Stifel Nicolaus and Company Inc. | Sales Agreement June 2020 | Maximum | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Proceeds from sale of common stock | $ 40,000,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Summary of Estimated Useful Lives of Assets (Details) | 6 Months Ended |
Jun. 30, 2020 | |
Laboratory Equipment | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives | 5 years |
Computer and Office Equipment | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives | 3 years |
Furniture and Fixtures | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives | 3 years |
Furniture and Fixtures | Maximum | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives | 8 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Anti-dilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 6,344,026 | 6,063,819 |
Common Stock Warrants | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 861,969 | 1,252,441 |
Common Stock Options | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 5,482,057 | 4,811,378 |
Fair Value - Schedule of Fair V
Fair Value - Schedule of Fair Value Assets Measured on Recurring Basis (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 32,687,000 | $ 39,304,000 |
Marketable securities | 25,179,000 | 15,120,000 |
Total | 57,866,000 | 54,424,000 |
Fair Value Measurements, Recurring Basis | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents | 32,687,000 | 39,304,000 |
Marketable securities | 25,179,000 | 15,120,000 |
Total | 57,866,000 | 54,424,000 |
Fair Value Measurements, Recurring Basis | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents | 32,687,000 | 39,304,000 |
Total | 32,687,000 | 39,304,000 |
Fair Value Measurements, Recurring Basis | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Marketable securities | 25,179,000 | 15,120,000 |
Total | $ 25,179,000 | $ 15,120,000 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Fair Value Disclosures [Abstract] | ||
Fair value assets transfers between Level 2 and Level 3 | $ 0 | $ 0 |
Cash equivalents and marketable securities | $ 57,866,000 | $ 54,424,000 |
Marketable Securities - Schedul
Marketable Securities - Schedule of Fair Value of Available-for-Sale Marketable Securities (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | $ 25,025,000 | $ 15,130,000 |
Gross Unrealized Gains | 155,000 | |
Gross Unrealized Losses | (10,000) | |
Fair Value | 25,179,000 | 15,120,000 |
U.S. Treasury Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 25,025,000 | 15,130,000 |
Gross Unrealized Gains | 155,000 | |
Gross Unrealized Losses | (10,000) | |
Fair Value | $ 25,179,000 | $ 15,120,000 |
Marketable Securities - Additio
Marketable Securities - Additional Information (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Investments Debt And Equity Securities [Abstract] | ||
Marketable securities | $ 25,179,000 | $ 15,120,000 |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 |
Property Plant And Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 4,014,000 | $ 3,873,000 | |
Less: Accumulated depreciation | (2,422,000) | (2,026,000) | |
Total property and equipment, net | 1,592,000 | 1,847,000 | |
Computer Equipment | |||
Property Plant And Equipment [Line Items] | |||
Property, plant and equipment, gross | 268,000 | 192,000 | |
Laboratory Equipment | |||
Property Plant And Equipment [Line Items] | |||
Property, plant and equipment, gross | 3,653,000 | 3,588,000 | |
Less: Accumulated depreciation | $ (138,000) | ||
Furniture and Fixtures | |||
Property Plant And Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 93,000 | $ 93,000 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Property Plant And Equipment [Line Items] | |||||
Depreciation expense | $ 202,000 | $ 205,000 | $ 396,000 | $ 410,000 | |
Loss on disposal of property and equipment | 0 | 0 | |||
Trademark amortization expense | 6,000 | ||||
Amortization of capitalized license expense | 133,000 | ||||
Accumulated depreciation and amortization | $ 2,422,000 | $ 2,422,000 | $ 2,026,000 | ||
Laboratory Equipment | |||||
Property Plant And Equipment [Line Items] | |||||
Loss on disposal of property and equipment | 54,000 | ||||
Disposal of property and equipment, gross | 319,000 | 319,000 | |||
Accumulated depreciation and amortization | $ 138,000 | $ 138,000 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Estimated Fair Value of Each Stock Option Award (Details) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Risk-free interest rate, minimum | 0.54% | 1.94% |
Risk-free interest rate, maximum | 1.56% | 2.59% |
Expected dividend yield | 0.00% | 0.00% |
Expected volatility, minimum | 98.00% | 82.00% |
Expected volatility, maximum | 99.60% | 94.00% |
Maximum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected life | 6 years 3 months | 6 years 3 months |
Minimum [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected life | 4 years | 4 years |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Option Activity (Details) - $ / shares | 6 Months Ended | 12 Months Ended |
Jun. 30, 2020 | Dec. 31, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Roll Forward | ||
Number of Shares, Outstanding Beginning Balance | 4,793,253 | |
Number of Shares, Granted | 729,300 | |
Number of Shares, Exercised | (276,622) | |
Number of Shares, Cancelled | (13,875) | |
Number of Shares, Outstanding Ending Balance | 5,232,056 | 4,793,253 |
Number of Shares, Exercisable | 2,653,979 | |
Weighted Average Exercise Price, Outstanding Beginning Balance | $ 7.10 | |
Weighted Average Exercise Price, Granted | 16.49 | |
Weighted Average Exercise Price, Exercised | 3.92 | |
Weighted Average Exercise Price, Cancelled | 10.97 | |
Weighted Average Exercise Price, Outstanding Ending Balance | 8.57 | $ 7.10 |
Weighed Average Exercise Price, Exercisable | $ 6.86 | |
Weighted Average Remaining Contractual Life (in Years) | 5 years 8 months 23 days | 5 years 7 months 20 days |
Weighted Average Remaining Contractual Life (in Years), Exercisable | 4 years 3 months |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) | Jan. 21, 2020 | May 31, 2020 | Mar. 31, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Oct. 03, 2019 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Stock-based compensation | $ 2,524,000 | $ 1,321,000 | $ 5,699,000 | $ 3,085,000 | |||||
Stock based payment options outstanding weighted average remaining term | 5 years 8 months 23 days | 5 years 7 months 20 days | |||||||
Number of Shares, Granted | 729,300 | ||||||||
Weighted Average Exercise Price, Granted | $ 16.49 | ||||||||
Unrecognized stock-based compensation | 16,935,000 | $ 16,935,000 | |||||||
Intrinsic value of exercisable stock options | $ 46,835,000 | $ 46,835,000 | |||||||
Intrinsic value of exercisable fair value per share | $ 4.25 | $ 4.25 | |||||||
Stock option granted | 729,300 | ||||||||
Unvested weighted average exercise price | $ 7.83 | ||||||||
Unvested share purchase | 94,375 | ||||||||
Post-employment options exercise period | 12 months | 36 months | |||||||
Stock-based compensation | $ 5,699,000 | $ 3,085,000 | |||||||
Restricted Stock Units | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Stock based payment options outstanding weighted average remaining term | 1 year 7 months 13 days | ||||||||
Number of Shares, Granted | 100,000 | ||||||||
Unrecognized stock-based compensation | $ 3,239,000 | $ 3,239,000 | |||||||
Stock option granted | 100,000 | ||||||||
Unvested share purchase | 100,000 | ||||||||
Weighted average grant date fair value per share | $ 17.77 | $ 17.77 | $ 7.53 | ||||||
Stock-based compensation | $ 756,000,000 | ||||||||
Number of Shares, Granted | 0 | 0 | 200,000 | 0 | |||||
Restricted Stock Units | February 10, 2020 | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Number of Shares, Granted | 150,000 | ||||||||
Stock option granted | 150,000 | ||||||||
Restricted Stock Units | March 31, 2020 | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Number of Shares, Granted | 50,000 | ||||||||
Stock option granted | 50,000 | ||||||||
Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Number of Shares, Granted | 215,000 | ||||||||
Stock option granted | 215,000 | ||||||||
Weighted average exercise price | $ 4 | ||||||||
Stock Option | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Stock-based compensation | $ 4,943,000 | ||||||||
Stock based payment options outstanding weighted average remaining term | 2 years 4 months 24 days | ||||||||
Number of Shares, Granted | 1,200 | 35,000 | 729,300 | 809,600 | |||||
Weighted Average Exercise Price, Granted | $ 8.09 | $ 6.33 | |||||||
Weighted average fair value, granted | $ 20.77 | $ 13.03 | |||||||
Stock option granted | 1,200 | 35,000 | 729,300 | 809,600 | |||||
Additional compensation modification cost | $ 344,850 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Nonvested Restricted Stock Units Activity (Details) - Restricted Stock Units - $ / shares | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Number of Shares, Granted | 0 | 0 | 200,000 | 0 | |
Weighted average grant date fair value per share | $ 17.77 | $ 17.77 | $ 7.53 | ||
2016 Omnibus Incentive Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Number of Shares, Nonvested balance as of December 31, 2019 | 66,667 | ||||
Number of Shares, Granted | 200,000 | ||||
Number of Shares, Vested/Released | (16,666) | ||||
Number of Shares, Nonvested balance at June 30, 2020 | 250,001 | 250,001 | 66,667 | ||
Weighted Average Grant Date Fair Value Per Share, Nonvested balance as of December 31, 2019 | $ 7.53 | ||||
Weighted average grant date fair value per share | 17.77 | ||||
Weighted Average Grant Date Fair Value Per Share, Vested/Released | 14.19 | ||||
Weighted Average Grant Date Fair Value Per Share, Nonvested balance at June 30, 2020 | $ 15.28 | $ 15.28 | $ 7.53 |
Stock-Based Compensation - Sc_3
Stock-Based Compensation - Schedule of Stock-Based Compensation Included in Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Stock-based compensation | $ 2,524 | $ 1,321 | $ 5,699 | $ 3,085 |
General and Administrative Expense | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Stock-based compensation | 994 | 402 | 2,011 | 962 |
Research and Development | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Stock-based compensation | $ 1,530 | $ 919 | $ 3,688 | $ 2,123 |
Warrants - Additional Informati
Warrants - Additional Information (Details) | 6 Months Ended | ||
Jun. 30, 2020USD ($)Tranche$ / sharesshares | Dec. 31, 2019shares | Jun. 15, 2015$ / shares | |
Class Of Warrant Or Right [Line Items] | |||
Number of tranches | Tranche | 2 | ||
Common stock warrants outstanding | shares | 861,969 | 1,189,827 | |
First tranche | |||
Class Of Warrant Or Right [Line Items] | |||
Common stock warrants outstanding | shares | 370,370 | ||
Exercise price of common stock warrants | $ / shares | $ 2.70 | ||
Common stock warrants term | 7 years | ||
Common stock warrants expiration date | Jun. 15, 2022 | ||
Warrant | |||
Class Of Warrant Or Right [Line Items] | |||
Intrinsic value of common stock warrants | $ | $ 13,530,500 | ||
Fair value of common stock | $ / shares | $ 24.51 | ||
Second tranche | |||
Class Of Warrant Or Right [Line Items] | |||
Common stock warrants term | 5 years | ||
Common stock warrants expiration date | Dec. 26, 2022 |
Warrants - Summary of Common St
Warrants - Summary of Common Stock Warrant Activity (Details) | 6 Months Ended |
Jun. 30, 2020shares | |
Class Of Warrant Or Right [Line Items] | |
Shares remaining to be issued as of December 31, 2019 | 1,189,827 |
Issued via cashless exercises | (278,179) |
Withheld as payment to cover issued shares | (49,679) |
Balance at June 30, 2020 | 861,969 |
First tranche | |
Class Of Warrant Or Right [Line Items] | |
Shares remaining to be issued as of December 31, 2019 | 322,259 |
Issued via cashless exercises | (227,184) |
Withheld as payment to cover issued shares | (22,464) |
Balance at June 30, 2020 | 72,611 |
Warrant Tranche 2 | |
Class Of Warrant Or Right [Line Items] | |
Shares remaining to be issued as of December 31, 2019 | 867,568 |
Issued via cashless exercises | (50,995) |
Withheld as payment to cover issued shares | (27,215) |
Balance at June 30, 2020 | 789,358 |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Details1) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-07-01 | Jun. 30, 2020 |
Current Liabilities | Maximum | |
Disaggregation Of Revenue [Line Items] | |
Revenue expected to be recognized | 12 months |
Contract Liabilities | Minimum [Member] | |
Disaggregation Of Revenue [Line Items] | |
Revenue expected to be recognized | 12 months |
Revenue Recognition - Additio_2
Revenue Recognition - Additional Information (Details) - USD ($) | May 16, 2019 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Nov. 06, 2018 |
Disaggregation Of Revenue [Line Items] | |||||||||
Transaction price recorded in liabilities | $ 2,500,000 | $ 2,500,000 | |||||||
Collaboration revenue | 1,075,000 | $ 1,055,000 | 1,975,000 | $ 1,425,000 | |||||
Short-term research and development contract liability | 5,263,000 | 5,263,000 | $ 4,097,000 | ||||||
Long-term research and development contract liability | 2,155,000 | 2,155,000 | 4,018,000 | ||||||
Income tax expense | 413,000 | 413,000 | |||||||
Prepaid expenses and other short-term assets | 2,197,000 | 2,197,000 | 860,000 | ||||||
Other long-term assets | 536,000 | 536,000 | 674,000 | ||||||
Merck | Collaboration Agreement with Merck | |||||||||
Disaggregation Of Revenue [Line Items] | |||||||||
Collaboration revenue | 118,000 | 700,000 | 173,000 | 700,000 | |||||
Short-term research and development contract liability | 310,500 | 310,500 | 310,500 | ||||||
Long-term research and development contract liability | 0 | 0 | 0 | ||||||
Milestone payments received | 2,500,000 | ||||||||
LG Chem Life Sciences | Collaboration Agreement with LG Chem Life Sciences | |||||||||
Disaggregation Of Revenue [Line Items] | |||||||||
Collaboration revenue | 957,000 | $ 725,000 | 1,802,000 | $ 725,000 | |||||
Short-term research and development contract liability | 4,953,000 | 4,953,000 | |||||||
Long-term research and development contract liability | 2,154,000 | 2,154,000 | |||||||
Equity investment nonrefundable upfront cash payment | $ 5,000,000 | ||||||||
Equity investment for research collaboration agreement | 5,000,000 | ||||||||
Additional amount receivable research development regulatory and sales milestones | 400,000,000 | ||||||||
Milestone payments received | $ 2,500,000 | ||||||||
Milestone payment associated with contract liability | 2,500,000 | ||||||||
Income tax expense | $ 412,500 | ||||||||
LG Chem Life Sciences | Collaboration Agreement with LG Chem Life Sciences | Maximum | |||||||||
Disaggregation Of Revenue [Line Items] | |||||||||
Additional amount receivable research development regulatory and sales milestones | $ 400,000,000 | ||||||||
Einstein | Einstein License And Service Agreement | |||||||||
Disaggregation Of Revenue [Line Items] | |||||||||
License expenses | $ 313,000 | 751,000 | $ 438,000 | ||||||
Amortization of intangible assets | 358,000 | ||||||||
Prepaid expenses and other short-term assets | 265,000 | 265,000 | 264,503 | ||||||
Other long-term assets | $ 128,000 | $ 128,000 | $ 260,497 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) | May 16, 2019USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Nov. 06, 2018USD ($) | Dec. 31, 2015SupportingTechnology |
Albert Einstein College Of Medicine | Einstein License And Service Agreement | |||||||
Commitments And Contingencies [Line Items] | |||||||
Milestone payments for each product, process or service | $ 1,850,000 | ||||||
Milestone payments for each new indication of licensed product | 1,850,000 | ||||||
Aggregate amount of additional milestone payments | 5,750,000 | ||||||
Merck | Collaboration Agreement with Merck | |||||||
Commitments And Contingencies [Line Items] | |||||||
Up front non refundable payment | $ 2,500,000 | 2,500,000 | |||||
Achievement of certain research and development milestones | 120,000,000 | 120,000,000 | |||||
Achievement of certain commercial milestones | 150,000,000 | ||||||
Milestone payments received | 2,500,000 | ||||||
Merck | Collaboration Agreement with Merck | Maximum | |||||||
Commitments And Contingencies [Line Items] | |||||||
Eligible to earn achievement of certain research and development milestones | 101,000,000 | 101,000,000 | |||||
LG Chem Life Sciences | Collaboration Agreement with LG Chem Life Sciences | |||||||
Commitments And Contingencies [Line Items] | |||||||
Milestone payments received | $ 2,500,000 | ||||||
Equity investment nonrefundable upfront cash payment | $ 5,000,000 | ||||||
Equity investment for research collaboration agreement | 5,000,000 | ||||||
Additional amount receivable research development regulatory and sales milestones | 400,000,000 | ||||||
Milestone payment associated with contract liability | $ 2,500,000 | ||||||
LG Chem Life Sciences | Collaboration Agreement with LG Chem Life Sciences | Maximum | |||||||
Commitments And Contingencies [Line Items] | |||||||
Additional amount receivable research development regulatory and sales milestones | $ 400,000,000 | ||||||
Einstein License | |||||||
Commitments And Contingencies [Line Items] | |||||||
Number of supporting technologies | SupportingTechnology | 2 | ||||||
Patent expenses | $ 18,750 | $ 162,500 | $ 37,500 | $ 175,000 | |||
Type of Cost, Good or Service [Extensible List] | us-gaap:LicenseMember | us-gaap:LicenseMember | us-gaap:LicenseMember | us-gaap:LicenseMember |
Leases - Additional Information
Leases - Additional Information (Details) | Jun. 24, 2020USD ($) | Oct. 01, 2019USD ($) | Sep. 16, 2019USD ($) | Sep. 20, 2018USD ($) | May 15, 2018 | May 01, 2018USD ($) | Jun. 30, 2020USD ($)ft² | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($)ft² | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($) | Jan. 01, 2019USD ($) |
Lessee Lease Description [Line Items] | ||||||||||||
Operating lease right-of-use | $ 8,150,000 | $ 8,150,000 | $ 5,337,000 | |||||||||
Operating lease, liability | $ 8,431,000 | $ 8,431,000 | ||||||||||
Lease agreement description | Upon execution of this lease agreement the Company prepaid three months of rent, two of which will be held in escrow and credited against future rent payments and one month that was applied to the first months rent. The Company also prepaid seven and one half months rent pursuant to an amendment to the lease agreement executed on June 18, 2018. These amounts were recorded to deposits and prepaid expenses, respectively at December 31, 2018. | |||||||||||
Operating lease, weighted average discount rate | 6.00% | 6.00% | ||||||||||
Rent expense | $ 1,080,000 | $ 1,137,000 | $ 2,160,000 | $ 2,274,000 | ||||||||
Operating Lease Agreement | ||||||||||||
Lessee Lease Description [Line Items] | ||||||||||||
Lease expiration date | Apr. 30, 2021 | |||||||||||
Lease agreement effective date | May 1, 2018 | |||||||||||
Lessee operating lease monthly rental rate for first eighteen months | $ 297,500 | |||||||||||
Lessee operating lease monthly rental payments for remaining term | $ 330,500 | |||||||||||
Amended Lease Agreement | ||||||||||||
Lessee Lease Description [Line Items] | ||||||||||||
Lease expiration date | Apr. 14, 2021 | |||||||||||
Lease agreement effective date | May 15, 2018 | |||||||||||
Operating Lease Agreement For Additional Laboratory Space | ||||||||||||
Lessee Lease Description [Line Items] | ||||||||||||
Lease expiration date | Apr. 14, 2021 | |||||||||||
Lease agreement effective date | Oct. 15, 2018 | |||||||||||
Lessee operating lease monthly rental payments for remaining term | $ 78,600 | |||||||||||
Lessee operating lease monthly rental payments for first twelve months | $ 72,600 | |||||||||||
Security deposit | $ 177,000 | $ 177,000 | $ 177,000 | |||||||||
Amended Additional Laboratory Lease | ||||||||||||
Lessee Lease Description [Line Items] | ||||||||||||
Lease expiration date | Apr. 14, 2021 | |||||||||||
Lease agreement effective date | Oct. 1, 2019 | |||||||||||
Lessee operating lease monthly rental payments for remaining term | $ 58,995 | |||||||||||
Lessee operating lease monthly rental payments | $ 78,600 | |||||||||||
Operating lease, weighted average discount rate | 6.00% | 6.00% | ||||||||||
ASU 2016-02 | ||||||||||||
Lessee Lease Description [Line Items] | ||||||||||||
Lease term | 1 year 11 months 15 days | 1 year 11 months 15 days | 1 year 3 months 14 days | |||||||||
Operating lease right-of-use | $ 8,150,000 | $ 8,150,000 | $ 5,337,000 | $ 9,692,000 | ||||||||
Operating lease, liability | $ 9,347,000 | |||||||||||
Reduction to right-of-use asset | $ 335,465 | |||||||||||
Decrease in Lease Liability | $ 327,079 | |||||||||||
Loss on right-of-use asset | 8,386 | |||||||||||
Operating lease liability short term | 4,249,000 | 4,448,000 | ||||||||||
Operating lease liability long term | $ 4,182,000 | $ 4,182,000 | $ 1,348,000 | |||||||||
ASU 2016-02 | Laboratory And Office Lease | ||||||||||||
Lessee Lease Description [Line Items] | ||||||||||||
Lease agreement description | Pursuant to the amendment (1) the term of the lease was extended to June 14, 2022 and (2) the monthly rental rate for the last 14 months of the lease term was increased to $375,174. | |||||||||||
Lease monthly rental payments | $ 375,174 | |||||||||||
Lease extended date | Jun. 14, 2022 | |||||||||||
Lease modification date | May 14, 2020 | |||||||||||
Adjustment related to right of use asset lease liability | $ 4,826,000 | |||||||||||
Cambridge, Massachusetts | ||||||||||||
Lessee Lease Description [Line Items] | ||||||||||||
Office space for lease | ft² | 19,900 | 19,900 | ||||||||||
Leases beginning date | May 31, 2018 | |||||||||||
Lease expiration date | Apr. 14, 2021 | |||||||||||
Present value of lease payments, discounting rate | 6.00% | |||||||||||
Lease term | 2 years 3 months 18 days | 2 years 3 months 18 days |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments on Operating Leases (Details) | Jun. 30, 2020USD ($) |
Leases [Abstract] | |
2020 | $ 2,337,000 |
2021 | 4,552,000 |
2022 | 2,064,000 |
Total lease payment | 8,953,000 |
Less: present value discount | (522,000) |
Operating lease, liability | $ 8,431,000 |
Leases - Schedule of Other Info
Leases - Schedule of Other Information of Operating Leases (Details) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020USD ($) | Jun. 30, 2020USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 893 | $ 893 |
Operating lease cost | $ 1,080 | $ 2,160 |
Weighted average discount rate | 6.00% | 6.00% |
Weighted average remaining lease term | 1 year 11 months 15 days | 1 year 11 months 15 days |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 2 Months Ended | 3 Months Ended | 6 Months Ended | 24 Months Ended | |||||
Jul. 31, 2020 | Aug. 03, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2018 | Jul. 15, 2020 | Jul. 14, 2020 | Dec. 31, 2019 | |
Subsequent Event [Line Items] | ||||||||||
Proceeds from sale of common stock | $ 42,353 | $ 3,715 | ||||||||
Common stock, shares authorized | 50,000,000 | 50,000,000 | 50,000,000 | |||||||
Common Stock | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Proceeds from sale of common stock, shares | 2,174,901 | 524,074 | 2,174,901 | 524,074 | 8,820,710 | |||||
Maximum | ATM Agreement | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Proceeds from sale of common stock | $ 40,000 | |||||||||
Subsequent Event | ATM Agreement | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Proceeds from sale of common stock | $ 3,200 | $ 11,300 | ||||||||
Proceeds from sale of common stock, shares | 150,000 | 500,000 | ||||||||
Subsequent Event | Common Stock | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Common stock, shares authorized | 100,000,000 | 50,000,000 |