Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 23, 2021 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2021 | |
Entity File Number | 001-38223 | |
Entity Registrant Name | RHYTHM PHARMACEUTICALS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-2159271 | |
Entity Address, Address Line One | 222 Berkeley Street | |
Entity Address, Address Line Two | 12th Floor | |
Entity Address, City or Town | Boston | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 02116 | |
City Area Code | 857 | |
Local Phone Number | 264-4280 | |
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | RYTM | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 50,206,758 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001649904 | |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 87,271 | $ 100,854 |
Short-term Investments | 317,479 | 71,938 |
Prepaid expenses and other current assets | 7,384 | 8,876 |
Total current assets | 412,134 | 181,668 |
Property and equipment, net | 3,006 | 3,195 |
Right-of-use asset | 1,741 | 1,807 |
Intangible assets, net | 5,000 | |
Restricted cash | 328 | 403 |
Total assets | 422,209 | 187,073 |
Current liabilities: | ||
Accounts payable | 9,147 | 4,900 |
Accrued expenses and other current liabilities | 7,150 | 12,559 |
Lease liability | 553 | 535 |
Total current liabilities | 16,850 | 17,994 |
Long-term liabilities: | ||
Deferred tax liability | 22,006 | |
Lease liability | 2,406 | 2,551 |
Total liabilities | 41,262 | 20,545 |
Commitments and contingencies (Notes 5) | ||
Stockholders' equity: | ||
Preferred Stock, $0.001 par value: 10,000,000 shares authorized; no shares issued and outstanding at March 31, 2021 and December 31, 2020 | ||
Common stock, $0.001 par value: 120,000,000 shares authorized; 50,201,758 and 44,235,903 shares issued and outstanding March 31, 2021 and December 31, 2020, respectively | 50 | 44 |
Additional paid-in capital | 796,532 | 625,762 |
Accumulated other comprehensive (loss) income | (58) | 49 |
Accumulated deficit | (415,577) | (459,327) |
Total stockholders' equity | 380,947 | 166,528 |
Total liabilities and stockholders' equity | $ 422,209 | $ 187,073 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock par value per share | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 10,000,000 | 10,000,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Common stock, par value per share | $ 0.001 | $ 0.001 |
Common stock, authorized | 120,000,000 | 120,000,000 |
Common stock, issued | 50,201,758 | 44,235,903 |
Common stock, outstanding | 50,201,758 | 44,235,903 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||
Revenue | $ 35 | |
Operating expenses: | ||
Cost of sales | 4 | |
Research and development | 19,911 | $ 22,504 |
Selling, general, and administrative | 14,518 | 12,796 |
Total costs and expenses | 34,433 | 35,300 |
Loss from operations | (34,398) | (35,300) |
Other income (expense): | ||
Other income | 100,000 | |
Interest income, net | 154 | 1,136 |
Total other income, net | 100,154 | 1,136 |
Income (loss) before taxes | 65,756 | (34,164) |
Provision for income taxes | 22,006 | |
Net income (loss) | $ 43,750 | $ (34,164) |
Basic (in dollars per share) | $ 0.92 | $ (0.78) |
Diluted (in dollars per share) | $ 0.90 | $ (0.78) |
Weighted average shares, Basic (in shares) | 47,638,565 | 44,049,843 |
Weighted average shares, Diluted (in shares) | 48,501,697 | 44,049,843 |
Other comprehensive loss: | ||
Net income (loss) | $ 43,750 | $ (34,164) |
Unrealized (loss) gain on marketable securities | (107) | 63 |
Comprehensive income (loss) | $ 43,643 | $ (34,101) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total |
Beginning balance at Dec. 31, 2019 | $ 44 | $ 606,307 | $ (325,331) | $ 281,020 | |
Beginning balance (in shares) at Dec. 31, 2019 | 43,996,753 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Stock compensation expense | 5,475 | 5,475 | |||
Issuance of common stock in connection with ESPP | 324 | 324 | |||
Issuance of common stock in connection with ESPP (in shares) | 18,673 | ||||
Issuance of common stock in connection with exercise of stock options | 383 | 383 | |||
Issuance of common stock in connection with exercise of stock options (in shares) | 72,964 | ||||
Unrealized gain (loss) on marketable securities | $ 63 | 63 | |||
Net income (loss) | (34,164) | (34,164) | |||
Ending balance at Mar. 31, 2020 | $ 44 | 612,489 | 63 | (359,495) | 253,101 |
Ending balance (in shares) at Mar. 31, 2020 | 44,088,390 | ||||
Beginning balance at Dec. 31, 2020 | $ 44 | 625,762 | 49 | (459,327) | 166,528 |
Beginning balance (in shares) at Dec. 31, 2020 | 44,235,903 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Stock compensation expense | 5,191 | 5,191 | |||
Issuance of common stock in connection with ESPP | 388 | 388 | |||
Issuance of common stock in connection with ESPP (in shares) | 17,000 | ||||
Issuance of common stock in connection with exercise of stock options and vesting of restricted stock units | 3,466 | 3,466 | |||
Issuance of common stock in connection with exercise of stock options and vesting of restricted stock units (in shares) | 198,855 | ||||
Issuance of common stock upon completion of public offering, net of offering costs | $ 6 | 161,725 | 161,731 | ||
Issuance of common stock upon completion of public offering, net of offering costs (in shares) | 5,750,000 | ||||
Change in unrealized gain (loss) on marketable securities | (107) | (107) | |||
Net income (loss) | 43,750 | 43,750 | |||
Ending balance at Mar. 31, 2021 | $ 50 | $ 796,532 | $ (58) | $ (415,577) | $ 380,947 |
Ending balance (in shares) at Mar. 31, 2021 | 50,201,758 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating activities | ||
Net income (loss) | $ 43,750 | $ (34,164) |
Adjustments to reconcile net loss to cash used in operating activities: | ||
Stock-based compensation expense | 5,191 | 5,475 |
Gain on sale of priority review voucher | (100,000) | |
Deferred tax provision | 22,006 | |
Depreciation and amortization | 201 | 167 |
Non-cash rent expense | (61) | (56) |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | 1,651 | (847) |
Accounts payable, accrued expenses and other current liabilities | (6,269) | (6,673) |
Net cash used in operating activities | (33,531) | (36,098) |
Investing activities | ||
Purchases of short-term investments | (297,542) | (15,370) |
Maturities of short-term investments | 51,842 | 44,243 |
Proceeds from sale of priority review voucher | 100,000 | |
Purchases of property and equipment | (12) | |
Net cash (used in) provided by investing activities | (145,712) | 28,873 |
Financing activities | ||
Net proceeds from issuance of common stock | 161,731 | |
Proceeds from the exercise of stock options | 3,466 | 383 |
Proceeds from issuance of common stock from ESPP | 388 | 324 |
Net cash provided by financing activities | 165,585 | 707 |
Net decrease in cash, cash equivalents and restricted cash | (13,658) | (6,518) |
Cash, cash equivalents and restricted cash at beginning of period | 101,257 | 62,697 |
Cash, cash equivalents and restricted cash at end of period | $ 87,599 | $ 56,179 |
Nature of Business
Nature of Business | 3 Months Ended |
Mar. 31, 2021 | |
Nature of Business | |
Nature of Business | Rhythm Pharmaceuticals, Inc. Notes to Unaudited Condensed Consolidated Financial Statements (In thousands, except share and per share information) 1. Nature of Business Rhythm Pharmaceuticals, Inc. (the “Company” or “we”) is a commercial-stage biopharmaceutical company focused on changing the paradigm for the treatment of rare genetic diseases of obesity, which are characterized by early-onset, severe obesity and an insatiable hunger or hyperphagia. Our lead product candidate is IMCIVREE (setmelanotide), a potent melanocortin-4 receptor, or MC4R, agonist for the treatment of rare genetic diseases of obesity. We believe IMCIVREE, for which we have exclusive worldwide rights, has the potential to restore dysfunctional MC4R signaling due to impaired MC4R pathway function. MC4R pathway deficiencies result in the disruption of satiety signals and energy homeostasis in the body, which, in turn, leads to intense feelings of hunger and to obesity. IMCIVREE has been approved by the U.S. Food and Drug Administration, or FDA, for chronic weight management in adult and pediatric patients six years of age and older with obesity due to proopiomelanocortin, or POMC, proprotein convertase subtilisin/kexin type 1, or PCSK1, or leptin receptor, or LEPR, deficiency confirmed by genetic testing. IMCIVREE is now commercially available. The Company is a Delaware corporation organized in February 2013 under the name Rhythm Metabolic, Inc., and as of October 2015, under the name Rhythm Pharmaceuticals, Inc. The Company’s continued development efforts are focused on obesity related to several single gene-related, or monogenic, MC4R pathway deficiencies: Bardet-Biedl syndrome, or BBS; Alström syndrome; HET obesity due to a genetic variant in one of the two alleles of the POMC, PCSK1 or LEPR gene, or HETs; obesity due to steroid receptor coactivator 1, or SRC1, deficiency; and obesity due to SH2B adapter protein 1, or SH2B1, deficiency; MC4R deficiency obesity and Smith-Magenis syndrome, as well as additional diseases as part of investigator-initiated protocols. Currently, there are no effective or approved treatments for these MC4R pathway-related diseases. The Company believes that the MC4R pathway is a compelling target for treating these genetic diseases because of its critical role in regulating appetite and weight by promoting satiety and weight control, and that peptide therapeutics are uniquely suited for activating this target. The Company is subject to risks and uncertainties common to commercial-stage companies in the biotechnology industry, including but not limited to risks associated with the commercialization of approved products, completing preclinical studies and clinical trials, receiving regulatory approvals for product candidates, development by competitors of new biopharmaceutical products, dependence on key personnel, protection of proprietary technology, compliance with government regulations and the ability to secure additional capital to fund operations. Commercialization of approved products will require significant resources and in order to market IMCIVREE, the Company must continue to build its sales, marketing, managerial and other non-technical capabilities or make arrangements with third parties to perform these services. Product candidates currently under development will require significant additional research and development efforts, including preclinical and clinical testing and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel and infrastructure and extensive compliance-reporting capabilities. Liquidity The Company has incurred operating losses and negative cash flows from operations since inception. As of March 31, 2021, the Company had an accumulated deficit of $415,577. The Company has primarily funded these losses through the proceeds from the sales of common and preferred stock, asset sales as well as capital contributions received from the former parent company, Rhythm Holdings LLC. To date, the Company has minimal product revenue and management expects operating losses to continue for the foreseeable future. The Company has devoted substantially all of its resources to its drug development efforts, comprising of research and development, manufacturing, conducting clinical trials for its product candidates, protecting its intellectual property, pre-commercialization activities and general and administrative functions relating to these operations. The future success of the Company is dependent on its ability to develop its product candidates and ultimately upon its ability to attain profitable operations. In February 2021, the Company completed the sale of a Rare Pediatric Disease Priority Review Voucher, or PRV, that it received in connection with the approval of IMCIVREE for $100,000. As the PRV did not have a carrying value, the gain recognized within Other income (loss) was equal to the gross proceeds received, with costs related to the sale of the voucher recorded within selling, general and administrative expenses. At March 31, 2021, the Company had $404,750 of cash and cash equivalents and short-term investments on hand. In the future, the Company will be dependent on obtaining funding from third parties, such as proceeds from the issuance of debt, sale of equity, product sales and funded research and development programs to maintain the Company's operations and meet the Company's obligations. There is no guarantee that additional equity or other financings will be available to the Company on acceptable terms, or at all. If the Company fails to obtain additional funding when needed, the Company would be forced to scale back, terminate its operations or seek to merge with or be acquired by another company. Management believes that the Company's existing cash resources will be sufficient to fund the Company's operations into at least the second half of 2023. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The Company's unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States, or GAAP, and the applicable rules and regulations of the Securities and Exchange Commission, or SEC, regarding interim financial reporting. Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification, or ASC, and Accounting Standards Updates, or ASU, of the Financial Accounting Standards Board, or FASB. As permitted under these rules, certain footnotes or other financial information that are normally required by GAAP have been condensed or omitted. The accompanying interim balance sheet as of March 31, 2021, the statements of operations and comprehensive income (loss) for the three months ended March 31, 2021 and 2020, the statements of stockholders equity and the statements of cash flows for the three months ended March 31, 2021 and 2020 and the related footnote disclosures are unaudited. In management's opinion, the unaudited interim financial statements have been prepared on the same basis as the audited financial statements as of and for the year ended December 31, 2020 and include all adjustments, which are all normal recurring adjustments, necessary for the fair presentation of the interim financial statements. The results for the three months ended March 31, 2021 are not necessarily indicative of the results expected for the full fiscal year, any other interim periods, or any future year or period. The accompanying unaudited condensed consolidated financial statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the unaudited condensed consolidated financial statements. As of March 31, 2021, there have been no material changes in the Company's significant accounting policies from those that were disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. Certain amounts totaling $63 in the consolidated statement of stockholders’ equity for the three months ended March 31, 2020, related to unrealized gains on marketable securities, have been reclassified from additional paid-in capital to accumulated other comprehensive income to conform to the current period presentation. This reclassification had no impact on the previously reported results of operations or cash flows for the three months ended March 31, 2020. Risks and Uncertainties There are many uncertainties regarding the COVID-19 pandemic, and the Company is closely monitoring the impact of the pandemic on all aspects of its business, including how the pandemic will impact its patients, employees, suppliers, vendors, business partners and distribution channels. While the pandemic did not materially affect the Company's financial results and business operations for the three months ended March 31, 2021, the Company is unable to predict the impact that COVID-19 will have on its financial position and operating results in future periods due to numerous uncertainties. The Company will continue to assess the evolving impact of the COVID-19 pandemic and will make adjustments to its operations as necessary. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The Company bases its estimates on historical experience and other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances. This process may result in actual results differing materially from those estimated amounts used in the preparation of the financial statements if these results differ from historical experience, or other assumptions do not turn out to be substantially accurate, even if such assumptions are reasonable when made. Significant estimates relied upon in preparing these financial statements include accruals related to research and development expenses, assumptions used to record stock-based compensation expense and the valuation allowance on the Company's deferred tax assets. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ materially from those estimates. Principles of Consolidation The consolidated financial statements include the accounts of Rhythm Pharmaceuticals, Inc. and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Off-Balance Sheet Risk and Concentrations of Credit Risk Financial instruments, which potentially subject the Company to significant concentration of credit risk, consist primarily of cash and cash equivalents and short-term investments, which are maintained at two federally insured financial institutions. The deposits held at these two institutions are in excess of federally insured limits. The Company has not experienced any losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. The Company has no off-balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Segment Information Operating segments are defined as components of an entity about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company currently operates in one business segment, which is the development and commercialization of therapies for patients with rare diseases. A single management team that reports to the Chief Executive Officer comprehensively manages the entire business. The Company does not operate separate lines of business with respect to its product or product candidates. Accordingly, the Company has one reportable segment. Revenue Recognition The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers Product Revenue, Net Subsequent to its regulatory approval in the U.S. on November 27, 2020, the Company began to sell IMCIVREE in the U.S. in March, 2021. The product is distributed through an exclusive third-party logistics, or 3PL, distribution agent that does not take title to the product. Once the product is delivered to the Company’s exclusive specialty pharmacy provider, our sole customer in the U.S., the customer (or “wholesaler”) takes title to the product. The wholesaler then distributes the product to health care providers and patients. In our exclusive distribution agreement with the 3PL company, the Company acts as principal because we retain control of the product. The Company generally does not offer returns of product sold to the customer. Revenue from product sales are recognized when the customer obtains control of our product, which occurs at a point in time, upon transfer of title to the customer because at that point in time we have no ongoing obligations to the customer. There are no other performance obligations besides the sale of product. The Company records shipping and handling costs within cost of goods sold on our consolidated statements of operations. We classify payments to our customer or other parties in the distribution channel for services that are distinct and priced at fair value as selling, general and administrative expenses in our consolidated statements of operations. Otherwise, payments to a customer or other parties in the distribution channel that do not meet those criteria are classified as a reduction of revenue, as discussed further below. Taxes collected from the customer relating to product sales and remitted to governmental authorities are excluded from revenue. Because our payment terms are generally forty-five days, we conclude there is not a significant financing component because the period between the transfer of a promised good or service to the customer and when the customer pays for that good or service will be one year or less. The Company expenses incremental costs of obtaining a contract as and when incurred since the expected amortization period of the asset that we would have recognized is one year or less. Reserves for Variable Consideration Revenues from product sales are recorded at the net sales price, or the transaction price, which includes estimates of variable consideration for which reserves are established and which result from discounts, returns, chargebacks, rebates, co-pay assistance and other allowances that are offered within contracts between us and our customer, health care providers and other indirect customers relating to the sale of IMCIVREE. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the customer) or a current liability (if the amount is payable to a party other than a customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as our historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect our best estimates of the amount of consideration to which we are entitled based on the terms of the contract. The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that it is considered probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from our estimates, we will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known. The following are the components of variable consideration related to product revenue: Chargebacks: Government rebates: Trade discounts and allowances: Product Returns: Other incentives: During the quarter ended March 31, 2021, we recorded product revenue, net, of $35. The table that summarizes balances and activity in each of the product revenue allowance and reserve categories has not been included for the quarter ended March 31, 2020 due to the immateriality of the revenue recognized during the period. Cost of Product Sales Prior to receiving approval from the FDA in November 2020 to sell IMCIVREE, the Company expensed all costs incurred related to the manufacture of IMCIVREE as research and development expense because of the inherent risks associated with the development of a drug candidate, the uncertainty about the regulatory approval process and the lack of history for the Company of regulatory approval of drug candidates. Subsequent to receiving FDA approval in November 2020, the Company has not capitalized any inventory related costs during the three month period ended March 31, 2021. Cost of product sales will consist of manufacturing costs, transportation and freight, amortization of capitalized intangibles, royalty payments and indirect overhead costs associated with the manufacturing and distribution of IMCIVREE. Cost of product sales may also include period costs related to certain manufacturing services and inventory adjustment charges. The Company is currently evaluating the impact of this previously expensed inventory on the future cost of product sales. Accounts Receivable, Net In general, accounts receivable consists of amounts due from customers, net of customer allowances for cash discounts, product returns, and chargebacks. The Company's contracts with customers have standard payment terms that generally require payment within 45 days. The Company analyzes accounts that are past due for collectability, and periodically evaluates the creditworthiness of its customers. As of March 31, 2021, we determined an allowance for doubtful accounts was not required based upon our review of contractual payment terms and individual customer circumstances. Intangible Assets, Net Definite-lived intangible assets related to capitalized milestones under license agreements are amortized on a straight-line basis over their remaining useful lives, which are estimated to be the remaining patent life. If our estimate of the product’s useful life is shorter than the remaining patent life, then a shorter period is used. Amortization expense is recorded as a component of cost of sales on the consolidated statements of operations and comprehensive income (loss). Intangible assets are evaluated for impairment at least annually in the fourth quarter or more frequently if impairment indicators exist. Events that could result in an impairment, or trigger an interim impairment assessment, include the decision to discontinue the development of a drug, the receipt of additional clinical or nonclinical data regarding our drug candidate or a potentially competitive drug candidate, changes in the clinical development program for a drug candidate, or new information regarding potential sales for the drug. In connection with any impairment assessment, the fair value of the intangible assets as of the date of assessment is compared to the carrying value of the intangible asset. Impairment losses are recognized if the carrying value of an intangible asset is both not recoverable and exceeds its fair value. Fair Value Measurements Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories: Level 1 — Quoted market prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s cash equivalents and marketable securities at March 31, 2021 and December 31, 2020 were carried at fair value, determined according to the fair value hierarchy. See Note 4 for further discussion. The carrying amounts reflected in the consolidated balance sheets for accounts payable and accrued expenses approximate their fair values due to their short-term maturities at March 31, 2021 and December 31, 2020, respectively. Net Income (Loss) Per Share Basic net income (loss) per share is computed by dividing the net income (loss) by the weighted-average number of common shares outstanding during the period, without consideration of potential dilutive securities. Diluted net income (loss) per common share is computed by adjusting the weighted-average shares outstanding for the potential dilutive effects of common stock equivalents outstanding during the period calculated in accordance with the treasury stock method. For purposes of the diluted net income (loss) per share calculation, 781,404 stock options and 82,591 restricted stock units were considered to be common stock equivalents for the three months ended March 31, 2021. For the three months ended March 31, 2020, the common stock equivalents have been excluded from the calculation of diluted net income (loss) per share, as their effect would be anti-dilutive for the period presented. The following table includes the potential common shares, presented based on amounts outstanding at each period end, that were excluded from the computation of diluted net loss per share due to their anti-dilutive effect, for the periods indicated: March 31, 2021 2020 Stock options 3,641,903 4,058,347 Restricted stock units 97,631 118,662 Potential common shares 3,739,534 4,177,009 Subsequent Events The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. Application of New or Revised Accounting Standards From time to time, new accounting pronouncements are issued by the FASB and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses-Measurement of Credit Losses on Financial Instruments In December 2019, the FASB issued ASU 2019-12, Income Taxes-Simplifying the Accounting for Income Taxes |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Mar. 31, 2021 | |
Accrued Expenses | |
Accrued Expenses | 3. Accrued Expenses Accrued expenses consisted of the following: March 31, December 31, 2021 2020 Research and development costs $ 3,532 $ 5,815 Professional fees 1,316 648 Payroll related 2,073 5,916 Other 229 180 Accrued expenses $ 7,150 $ 12,559 |
Fair Value of Financial Assets
Fair Value of Financial Assets | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value of Financial Assets | |
Fair Value of Financial Assets | 4. Fair Value of Financial Assets As of March 31, 2021 and December 31, 2020, the carrying amount of cash and cash equivalents and short-term investments was $404,750 and $172,792, respectively, which approximates fair value. Cash and cash equivalents and short-term investments includes investments in U.S. treasury securities and money market funds that invest in U.S. government securities that are valued using quoted market prices. Accordingly, money market funds and government funds are categorized as Level 1. The financial assets valued based on Level 2 inputs consist of corporate debt securities and commercial paper, which consist of investments in highly-rated investment-grade corporations. The following tables present information about the Company's financial assets measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values: Fair value Measurements as of March 31, 2021 using: Level 1 Level 2 Level 3 Total Assets: Cash Equivalents: Commercial Paper $ — $ 4,750 $ — $ 4,750 Money Market Funds 81,365 — — 81,365 Marketable Securities: Corporate Debt Securities and Commercial Paper — 317,479 — 317,479 Total $ 81,365 $ 322,229 $ — $ 403,594 Fair value Measurements as of December 31, 2020 using: Level 1 Level 2 Level 3 Total Assets: Cash Equivalents: Corporate Debt Securities and Commercial Paper $ — $ 36,242 $ — $ 36,242 Money Market Funds 63,182 — — 63,182 Marketable Securities: Corporate Debt Securities and Commercial Paper — 71,938 — 71,938 Total $ 63,182 $ 108,180 $ — $ 171,362 Marketable Securities The following tables summarize the Company's marketable securities: March 31, 2021 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Assets Corporate debt securities and commercial paper (due within 1 year) $ 317,538 $ 1 $ (60) $ 317,479 $ 317,538 $ 1 $ (60) $ 317,479 December 31, 2020 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Assets Corporate debt securities and commercial paper (due within 1 year) $ 71,895 $ 43 $ — $ 71,938 $ 71,895 $ 43 $ — $ 71,938 |
Right of Use Asset and Lease Li
Right of Use Asset and Lease Liability | 3 Months Ended |
Mar. 31, 2021 | |
Right Of Use Asset and Lease Liability | |
Right Of Use Asset and Lease Liability | 5. Right Of Use Asset and Lease Liability The Company has a material operating lease for its head office facility and other immaterial operating leases for certain equipment. The Company’s office lease has a remaining lease term of 4.3 years. The Company measured the lease liability associated with the office lease using a discount rate of 10% at inception. The Company estimated the incremental borrowing rate for the leased asset based on a range of comparable interest rates the Company would incur to borrow an amount equal to the lease payments on a collateralized basis over a similar term in a similar economic environment. As of March 31, 2021, the Company has not entered into any lease arrangements classified as a finance lease. The Company’s corporate headquarters is located in Boston, Massachusetts. This facility houses the Company’s research, clinical, regulatory, commercial and administrative personnel. The Company’s lease agreement commenced May 2019 and has a term of six years with a five-year renewal option to extend the lease. The Company has not included the five-year renewal option to extend the lease in its measurement of the ROU asset or lease liability. The following table presents the maturities of the Company’s operating lease liability related to office space as of March 31, 2021, all of which is under a non-cancellable operating lease: Operating Lease Remainder of 2021 $ 603 2022 818 2023 834 2024 851 2025 502 Thereafter — Total operating lease payments 3,608 Less: imputed interest 649 Total operating lease liability $ 2,959 |
Intangible Assets, Net
Intangible Assets, Net | 3 Months Ended |
Mar. 31, 2021 | |
Intangible Assets, Net | |
Intangible Assets, Net | 6. Intangible Assets, Net As of March 31, 2021, the Company’s finite-lived intangible assets, which totaled $5.0 million, resulted from the capitalization of certain milestone payments made to Ipsen Pharma, S.A.S., or Ipsen, in accordance with the terms of the Company’s license agreement with Ipsen, in The Company began amortizing its finite-lived intangible assets in March 2021 over IMCIVREE’s initial regulatory exclusivity period. Amortization expense was not material for the three months ended March 31, 2021. Amortization expense will be included in cost of sales on the consolidated statements of operations and comprehensive loss. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Taxes | |
Income Tax | 7. Income Taxes |
Common Stock
Common Stock | 3 Months Ended |
Mar. 31, 2021 | |
Common Stock | |
Common Stock | 8. Common Stock On February 9, 2021 the Company completed a public offering of 5,750,000 shares of common stock at an offering price of $30.00 per share, which included the exercise in full by the underwriters of their option to purchase up to 750,000 additional shares of common stock. The Company received $161,731 in net proceeds after deducting underwriting discounts, commissions and offering expenses. During the three months ended March 31, 2020, the Company entered into a separation agreement with its former Chief Executive Officer, Keith Gottesdiener, M.D. The Company modified certain equity awards held by Dr. Gottesdiener. The modification included the continuation of vesting of stock options through the end of December 31, 2020 and an extension of the post-termination exercise period for vested options from 90 days to up to two years. In connection with this modification, the Company recorded an incremental compensation charge of $2,811 during the three months ended March 31, 2020. As of March 31, 2021, an aggregate of 10,039,110 shares of common stock were reserved for future issuance under the Company’s stock plans, including outstanding stock options and restricted stock units that have been issued of 6,365,832 shares of common stock and 983,993 shares are available for future grants under the Company’s 2017 Employee Stock Purchase Plan. |
Related-Party Transactions
Related-Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related-Party Transactions | |
Related-Party Transactions | 9. Related-Party Transactions Expenses paid directly to consultants and vendors considered to be related parties amounted to $636 and $860 for the three months ended March 31, 2021 and 2020, respectively. Outstanding payments due to these related parties as of March 31, 2021 and December 31, 2020 were $42 and $187, respectively, and were included within accounts payable on the balance sheet. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The Company's unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States, or GAAP, and the applicable rules and regulations of the Securities and Exchange Commission, or SEC, regarding interim financial reporting. Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification, or ASC, and Accounting Standards Updates, or ASU, of the Financial Accounting Standards Board, or FASB. As permitted under these rules, certain footnotes or other financial information that are normally required by GAAP have been condensed or omitted. The accompanying interim balance sheet as of March 31, 2021, the statements of operations and comprehensive income (loss) for the three months ended March 31, 2021 and 2020, the statements of stockholders equity and the statements of cash flows for the three months ended March 31, 2021 and 2020 and the related footnote disclosures are unaudited. In management's opinion, the unaudited interim financial statements have been prepared on the same basis as the audited financial statements as of and for the year ended December 31, 2020 and include all adjustments, which are all normal recurring adjustments, necessary for the fair presentation of the interim financial statements. The results for the three months ended March 31, 2021 are not necessarily indicative of the results expected for the full fiscal year, any other interim periods, or any future year or period. The accompanying unaudited condensed consolidated financial statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the unaudited condensed consolidated financial statements. As of March 31, 2021, there have been no material changes in the Company's significant accounting policies from those that were disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. Certain amounts totaling $63 in the consolidated statement of stockholders’ equity for the three months ended March 31, 2020, related to unrealized gains on marketable securities, have been reclassified from additional paid-in capital to accumulated other comprehensive income to conform to the current period presentation. This reclassification had no impact on the previously reported results of operations or cash flows for the three months ended March 31, 2020. |
Risks and Uncertainties | Risks and Uncertainties There are many uncertainties regarding the COVID-19 pandemic, and the Company is closely monitoring the impact of the pandemic on all aspects of its business, including how the pandemic will impact its patients, employees, suppliers, vendors, business partners and distribution channels. While the pandemic did not materially affect the Company's financial results and business operations for the three months ended March 31, 2021, the Company is unable to predict the impact that COVID-19 will have on its financial position and operating results in future periods due to numerous uncertainties. The Company will continue to assess the evolving impact of the COVID-19 pandemic and will make adjustments to its operations as necessary. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The Company bases its estimates on historical experience and other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances. This process may result in actual results differing materially from those estimated amounts used in the preparation of the financial statements if these results differ from historical experience, or other assumptions do not turn out to be substantially accurate, even if such assumptions are reasonable when made. Significant estimates relied upon in preparing these financial statements include accruals related to research and development expenses, assumptions used to record stock-based compensation expense and the valuation allowance on the Company's deferred tax assets. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ materially from those estimates. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Rhythm Pharmaceuticals, Inc. and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. |
Off-Balance Sheet Risk and Concentrations of Credit Risk | Off-Balance Sheet Risk and Concentrations of Credit Risk Financial instruments, which potentially subject the Company to significant concentration of credit risk, consist primarily of cash and cash equivalents and short-term investments, which are maintained at two federally insured financial institutions. The deposits held at these two institutions are in excess of federally insured limits. The Company has not experienced any losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. The Company has no off-balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. |
Segment Information | Segment Information Operating segments are defined as components of an entity about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company currently operates in one business segment, which is the development and commercialization of therapies for patients with rare diseases. A single management team that reports to the Chief Executive Officer comprehensively manages the entire business. The Company does not operate separate lines of business with respect to its product or product candidates. Accordingly, the Company has one reportable segment. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers Product Revenue, Net Subsequent to its regulatory approval in the U.S. on November 27, 2020, the Company began to sell IMCIVREE in the U.S. in March, 2021. The product is distributed through an exclusive third-party logistics, or 3PL, distribution agent that does not take title to the product. Once the product is delivered to the Company’s exclusive specialty pharmacy provider, our sole customer in the U.S., the customer (or “wholesaler”) takes title to the product. The wholesaler then distributes the product to health care providers and patients. In our exclusive distribution agreement with the 3PL company, the Company acts as principal because we retain control of the product. The Company generally does not offer returns of product sold to the customer. Revenue from product sales are recognized when the customer obtains control of our product, which occurs at a point in time, upon transfer of title to the customer because at that point in time we have no ongoing obligations to the customer. There are no other performance obligations besides the sale of product. The Company records shipping and handling costs within cost of goods sold on our consolidated statements of operations. We classify payments to our customer or other parties in the distribution channel for services that are distinct and priced at fair value as selling, general and administrative expenses in our consolidated statements of operations. Otherwise, payments to a customer or other parties in the distribution channel that do not meet those criteria are classified as a reduction of revenue, as discussed further below. Taxes collected from the customer relating to product sales and remitted to governmental authorities are excluded from revenue. Because our payment terms are generally forty-five days, we conclude there is not a significant financing component because the period between the transfer of a promised good or service to the customer and when the customer pays for that good or service will be one year or less. The Company expenses incremental costs of obtaining a contract as and when incurred since the expected amortization period of the asset that we would have recognized is one year or less. Reserves for Variable Consideration Revenues from product sales are recorded at the net sales price, or the transaction price, which includes estimates of variable consideration for which reserves are established and which result from discounts, returns, chargebacks, rebates, co-pay assistance and other allowances that are offered within contracts between us and our customer, health care providers and other indirect customers relating to the sale of IMCIVREE. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the customer) or a current liability (if the amount is payable to a party other than a customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as our historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect our best estimates of the amount of consideration to which we are entitled based on the terms of the contract. The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that it is considered probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from our estimates, we will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known. The following are the components of variable consideration related to product revenue: Chargebacks: Government rebates: Trade discounts and allowances: Product Returns: Other incentives: During the quarter ended March 31, 2021, we recorded product revenue, net, of $35. The table that summarizes balances and activity in each of the product revenue allowance and reserve categories has not been included for the quarter ended March 31, 2020 due to the immateriality of the revenue recognized during the period. |
Accounts Receivable, Net | Accounts Receivable, Net In general, accounts receivable consists of amounts due from customers, net of customer allowances for cash discounts, product returns, and chargebacks. The Company's contracts with customers have standard payment terms that generally require payment within 45 days. The Company analyzes accounts that are past due for collectability, and periodically evaluates the creditworthiness of its customers. As of March 31, 2021, we determined an allowance for doubtful accounts was not required based upon our review of contractual payment terms and individual customer circumstances. |
Intangible Assets, Net | Intangible Assets, Net Definite-lived intangible assets related to capitalized milestones under license agreements are amortized on a straight-line basis over their remaining useful lives, which are estimated to be the remaining patent life. If our estimate of the product’s useful life is shorter than the remaining patent life, then a shorter period is used. Amortization expense is recorded as a component of cost of sales on the consolidated statements of operations and comprehensive income (loss). Intangible assets are evaluated for impairment at least annually in the fourth quarter or more frequently if impairment indicators exist. Events that could result in an impairment, or trigger an interim impairment assessment, include the decision to discontinue the development of a drug, the receipt of additional clinical or nonclinical data regarding our drug candidate or a potentially competitive drug candidate, changes in the clinical development program for a drug candidate, or new information regarding potential sales for the drug. In connection with any impairment assessment, the fair value of the intangible assets as of the date of assessment is compared to the carrying value of the intangible asset. Impairment losses are recognized if the carrying value of an intangible asset is both not recoverable and exceeds its fair value. |
Fair Value Measurements | Fair Value Measurements Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories: Level 1 — Quoted market prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s cash equivalents and marketable securities at March 31, 2021 and December 31, 2020 were carried at fair value, determined according to the fair value hierarchy. See Note 4 for further discussion. The carrying amounts reflected in the consolidated balance sheets for accounts payable and accrued expenses approximate their fair values due to their short-term maturities at March 31, 2021 and December 31, 2020, respectively. |
Net Income (Loss) Per Share | Net Income (Loss) Per Share Basic net income (loss) per share is computed by dividing the net income (loss) by the weighted-average number of common shares outstanding during the period, without consideration of potential dilutive securities. Diluted net income (loss) per common share is computed by adjusting the weighted-average shares outstanding for the potential dilutive effects of common stock equivalents outstanding during the period calculated in accordance with the treasury stock method. For purposes of the diluted net income (loss) per share calculation, 781,404 stock options and 82,591 restricted stock units were considered to be common stock equivalents for the three months ended March 31, 2021. For the three months ended March 31, 2020, the common stock equivalents have been excluded from the calculation of diluted net income (loss) per share, as their effect would be anti-dilutive for the period presented. The following table includes the potential common shares, presented based on amounts outstanding at each period end, that were excluded from the computation of diluted net loss per share due to their anti-dilutive effect, for the periods indicated: March 31, 2021 2020 Stock options 3,641,903 4,058,347 Restricted stock units 97,631 118,662 Potential common shares 3,739,534 4,177,009 |
Subsequent Events | Subsequent Events The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. |
Application of New or Revised Accounting Standards | Application of New or Revised Accounting Standards From time to time, new accounting pronouncements are issued by the FASB and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses-Measurement of Credit Losses on Financial Instruments In December 2019, the FASB issued ASU 2019-12, Income Taxes-Simplifying the Accounting for Income Taxes |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Summary of Significant Accounting Policies | |
Schedule of potential common shares, presented based on amounts outstanding at each period end, excluded from computation of diluted net loss per share attributable to common stockholders | March 31, 2021 2020 Stock options 3,641,903 4,058,347 Restricted stock units 97,631 118,662 Potential common shares 3,739,534 4,177,009 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accrued Expenses | |
Schedule of accrued expenses | March 31, December 31, 2021 2020 Research and development costs $ 3,532 $ 5,815 Professional fees 1,316 648 Payroll related 2,073 5,916 Other 229 180 Accrued expenses $ 7,150 $ 12,559 |
Fair Value of Financial Assets
Fair Value of Financial Assets (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value of Financial Assets | |
Schedule of financial assets and liabilities measured at fair value on a recurring basis | Fair value Measurements as of March 31, 2021 using: Level 1 Level 2 Level 3 Total Assets: Cash Equivalents: Commercial Paper $ — $ 4,750 $ — $ 4,750 Money Market Funds 81,365 — — 81,365 Marketable Securities: Corporate Debt Securities and Commercial Paper — 317,479 — 317,479 Total $ 81,365 $ 322,229 $ — $ 403,594 Fair value Measurements as of December 31, 2020 using: Level 1 Level 2 Level 3 Total Assets: Cash Equivalents: Corporate Debt Securities and Commercial Paper $ — $ 36,242 $ — $ 36,242 Money Market Funds 63,182 — — 63,182 Marketable Securities: Corporate Debt Securities and Commercial Paper — 71,938 — 71,938 Total $ 63,182 $ 108,180 $ — $ 171,362 |
Schedule of marketable securities | March 31, 2021 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Assets Corporate debt securities and commercial paper (due within 1 year) $ 317,538 $ 1 $ (60) $ 317,479 $ 317,538 $ 1 $ (60) $ 317,479 December 31, 2020 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Assets Corporate debt securities and commercial paper (due within 1 year) $ 71,895 $ 43 $ — $ 71,938 $ 71,895 $ 43 $ — $ 71,938 |
Right of Use Asset and Lease _2
Right of Use Asset and Lease Liability (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Right Of Use Asset and Lease Liability | |
Schedule of operating lease maturities | Operating Lease Remainder of 2021 $ 603 2022 818 2023 834 2024 851 2025 502 Thereafter — Total operating lease payments 3,608 Less: imputed interest 649 Total operating lease liability $ 2,959 |
Nature of Business (Details)
Nature of Business (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |
Feb. 28, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Nature of Business | |||
Accumulated deficit | $ (415,577) | $ (459,327) | |
Proceeds From Sale Of Priority Review Voucher | $ 100,000 | 100,000 | |
Revenue | 35 | ||
Carrying amount of cash and cash equivalents and short term investments | $ 404,750 | $ 172,792 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021itemsegment | Mar. 31, 2020USD ($) | |
Off Balance Sheet Risk and Concentrations of Credit Risk | ||
Number of federally insured financial institutions | item | 2 | |
Segment Information | ||
Number of operating segments | 1 | |
Number of reporting segments | 1 | |
Revenue Recognition | ||
Payment terms | 45 days | |
Accounts receivable standard payment terms | 45 days | |
Unrealized gains on marketable securities, reclassified from additional paid-in capital to accumulated other comprehensive income | $ | $ 63,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Shares Excluded For EPS (Details) - shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Shares excluded from the computation of diluted net loss per share | ||
Common stock equivalents excluded from the computation of diluted net loss per share due to their anti-dilutive effect (in shares) | 48,501,697 | 44,049,843 |
Shares excluded from the computation of diluted net loss per share | 3,739,534 | 4,177,009 |
Stock options | ||
Shares excluded from the computation of diluted net loss per share | ||
Common stock equivalents excluded from the computation of diluted net loss per share due to their anti-dilutive effect (in shares) | 781,404 | |
Shares excluded from the computation of diluted net loss per share | 3,641,903 | 4,058,347 |
Restricted stock units | ||
Shares excluded from the computation of diluted net loss per share | ||
Common stock equivalents excluded from the computation of diluted net loss per share due to their anti-dilutive effect (in shares) | 82,591 | |
Shares excluded from the computation of diluted net loss per share | 97,631 | 118,662 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Application of New or Revised Accounting Standards (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Summary of Significant Accounting Policies | ||
Right-of-use asset | $ 1,741 | $ 1,807 |
Operating Lease, Liability | $ 2,959 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Accrued Expenses | ||
Research and development costs | $ 3,532 | $ 5,815 |
Professional fees | 1,316 | 648 |
Payroll related | 2,073 | 5,916 |
Other | 229 | 180 |
Accrued expenses | $ 7,150 | $ 12,559 |
Fair Value of Financial Asset_2
Fair Value of Financial Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Fair Value of Financial Assets and Liabilities | ||
Carrying amount of cash and cash equivalents and short term investments | $ 404,750 | $ 172,792 |
Fair value of financial assets and liabilities | ||
Marketable Securities | 317,479 | 71,938 |
Corporate Debt Securities and Commercial Paper | ||
Fair value of financial assets and liabilities | ||
Marketable Securities | 317,479 | 71,938 |
Recurring | Estimated fair value | ||
Fair value of financial assets and liabilities | ||
Fair value of assets | 403,594 | 171,362 |
Recurring | Commercial Paper | Estimated fair value | ||
Fair value of financial assets and liabilities | ||
Cash Equivalents | 4,750 | |
Recurring | Corporate Debt Securities and Commercial Paper | Estimated fair value | ||
Fair value of financial assets and liabilities | ||
Cash Equivalents | 36,242 | |
Marketable Securities | 317,479 | 71,938 |
Recurring | Money Market Funds | Estimated fair value | ||
Fair value of financial assets and liabilities | ||
Cash Equivalents | 81,365 | 63,182 |
Recurring | Level 1 | Estimated fair value | ||
Fair value of financial assets and liabilities | ||
Fair value of assets | 81,365 | 63,182 |
Recurring | Level 1 | Money Market Funds | Estimated fair value | ||
Fair value of financial assets and liabilities | ||
Cash Equivalents | 81,365 | 63,182 |
Recurring | Level 2 | Estimated fair value | ||
Fair value of financial assets and liabilities | ||
Fair value of assets | 322,229 | 108,180 |
Recurring | Level 2 | Commercial Paper | Estimated fair value | ||
Fair value of financial assets and liabilities | ||
Cash Equivalents | 4,750 | |
Recurring | Level 2 | Corporate Debt Securities and Commercial Paper | Estimated fair value | ||
Fair value of financial assets and liabilities | ||
Cash Equivalents | 36,242 | |
Marketable Securities | $ 317,479 | $ 71,938 |
Fair Value of Financial Asset_3
Fair Value of Financial Assets - Marketable Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Fair Value of Financial Assets and Liabilities | ||
Amortized Cost | $ 317,538 | $ 71,895 |
Gross Unrealized Gains | 1 | 43 |
Gross Unrealized Losses | (60) | |
Fair Value | 317,479 | 71,938 |
Corporate Debt Securities and Commercial Paper | ||
Fair Value of Financial Assets and Liabilities | ||
Amortized Cost | 317,538 | 71,895 |
Gross Unrealized Gains | 1 | 43 |
Gross Unrealized Losses | (60) | |
Fair Value | 317,479 | 71,938 |
Recurring | Estimated fair value | Corporate Debt Securities and Commercial Paper | ||
Fair Value of Financial Assets and Liabilities | ||
Fair Value | 317,479 | 71,938 |
Recurring | Level 2 | Estimated fair value | Corporate Debt Securities and Commercial Paper | ||
Fair Value of Financial Assets and Liabilities | ||
Fair Value | $ 317,479 | $ 71,938 |
Right of Use Asset and Lease _3
Right of Use Asset and Lease Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Right Of Use Asset and Lease Liability | ||
Remaining term of operating lease (in years) | 4 years 3 months 18 days | |
Operating lease discount rate | 10.00% | |
Right-of-use asset | $ 1,741 | $ 1,807 |
Operating Lease, Liability | $ 2,959 | |
Lease term (in years) | 6 years | |
Lease renewal term (in years) | 5 years | |
Option to extend | true |
Right of Use Asset and Lease _4
Right of Use Asset and Lease Liability - Operating Lease Maturities (Details) $ in Thousands | Mar. 31, 2021USD ($) |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |
Remainder of 2021 | $ 603 |
2022 | 818 |
2023 | 834 |
2024 | 851 |
2025 | 502 |
Total operating lease payments | 3,608 |
Less: imputed interest | 649 |
Total operating lease liability | $ 2,959 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details) $ in Thousands | Mar. 31, 2021USD ($) |
Intangible Assets, Net | |
Intangible assets, net | $ 5,000 |
Income Taxes (Details)
Income Taxes (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Income Taxes | |
Income taxes | $ 22,006 |
Common Stock (Details)
Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 09, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 |
Common Stock | ||||
Common stock, authorized | 120,000,000 | 120,000,000 | ||
Price per share | $ 30 | |||
Issuance of stock (in shares) | 5,750,000 | |||
Net proceeds from issuance of common stock | $ 161,731 | $ 161,731 | ||
Incremental compensation charge | $ 2,811 | |||
Maximum | Underwriter option to purchase | ||||
Common Stock | ||||
Additional shares | 750,000 | |||
Former Chief Executive Officer, Keith Gottesdiener, M.D. | Minimum | ||||
Common Stock | ||||
Post-termination exercise period for vested options | 90 days | |||
Former Chief Executive Officer, Keith Gottesdiener, M.D. | Maximum | ||||
Common Stock | ||||
Post-termination exercise period for vested options | 2 years | |||
2017 Employee Stock Purchase Plan | ||||
Common Stock | ||||
Common stock reserved for issuance | 10,039,110 | |||
Shares available for future grant | 983,993 | |||
2017 Employee Stock Purchase Plan | Equity Option | ||||
Common Stock | ||||
Common stock reserved for issuance | 6,365,832 |
Related-Party Transactions (Det
Related-Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Accounts Payable | |||
Related Party Transaction | |||
Outstanding payments due to consultants | $ 42 | $ 187 | |
Consultant | |||
Related Party Transaction | |||
Expenses paid to consultants | $ 636 | $ 860 |