Document and Entity Information
Document and Entity Information | 9 Months Ended |
Sep. 30, 2019shares | |
Document and Entity Information [Abstract] | |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | Sep. 30, 2019 |
Document Fiscal Year Focus | 2019 |
Document Fiscal Period Focus | Q3 |
Trading Symbol | DCPH |
Entity Registrant Name | Deciphera Pharmaceuticals, Inc. |
Entity Central Index Key | 0001654151 |
Current Fiscal Year End Date | --12-31 |
Entity Current Reporting Status | Yes |
Entity Shell Company | false |
Entity Filer Category | Accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | true |
Entity Address, State or Province | MA |
Entity Interactive Data Current | Yes |
Title of 12(b) Security | Common Stock |
Security Exchange Name | NASDAQ |
Entity Common Stock, Shares Outstanding | 51,043,912 |
Document Transition Report | false |
Document Quarterly Report | true |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 173,712 | $ 293,764 |
Marketable securities | 460,883 | 0 |
Prepaid expenses and other current assets | 7,700 | 7,273 |
Total current assets | 642,295 | 301,037 |
Long-term investment—restricted | 1,510 | 1,069 |
Property and equipment, net | 5,274 | 13,453 |
Operating lease assets | 522 | 0 |
Total assets | 649,601 | 315,559 |
Current liabilities: | ||
Accounts payable | 14,770 | 8,308 |
Accrued expenses and other current liabilities | 26,884 | 13,709 |
Operating lease liabilities | 415 | 539 |
Notes payable to related party | 187 | 187 |
Total current liabilities | 42,256 | 22,743 |
Notes payable to related party, net of current portion | 967 | 1,107 |
Operating lease liabilities, net of current portion | 107 | 11,347 |
Other long-term liabilities | 718 | 381 |
Total liabilities | 44,048 | 35,578 |
Commitments and contingencies (Note 10) | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value per share; 5,000,000 shares authorized; no shares issued or outstanding | 0 | 0 |
Common stock, $0.01 par value per share; 125,000,000 shares authorized; 51,043,912 shares and 37,676,760 shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively | 510 | 377 |
Additional paid-in capital | 1,025,745 | 575,327 |
Accumulated other comprehensive income | 61 | 0 |
Accumulated deficit | (420,763) | (295,723) |
Total stockholders’ equity | 605,553 | 279,981 |
Total liabilities and stockholders’ equity | $ 649,601 | $ 315,559 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 125,000,000 | 125,000,000 |
Common stock, shares issued (in shares) | 51,043,912 | 37,676,760 |
Common stock, shares outstanding (in shares) | 51,043,912 | 37,676,760 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Statement [Abstract] | ||||
Revenues | $ 0 | $ 0 | $ 25,000 | $ 0 |
Operating expenses: | ||||
Research and development | 40,374 | 20,630 | 110,974 | 55,531 |
General and administrative | 17,979 | 5,259 | 44,379 | 14,738 |
Total operating expenses | 58,353 | 25,889 | 155,353 | 70,269 |
Loss from operations | (58,353) | (25,889) | (130,353) | (70,269) |
Other income (expense): | ||||
Interest and other income, net | 2,174 | 1,475 | 5,368 | 2,778 |
Interest expense | (17) | (21) | (55) | (64) |
Total other income (expense), net | 2,157 | 1,454 | 5,313 | 2,714 |
Net loss | $ (56,196) | $ (24,435) | $ (125,040) | $ (67,555) |
Net loss per share—basic and diluted (in dollars per share) | $ (1.28) | $ (0.65) | $ (3.12) | $ (1.95) |
Weighted average common shares outstanding—basic and diluted (in shares) | 43,803,508 | 37,654,324 | 40,041,321 | 34,623,773 |
Comprehensive loss: | ||||
Net loss | $ (56,196) | $ (24,435) | $ (125,040) | $ (67,555) |
Other comprehensive income (loss): | ||||
Unrealized gains (losses) on marketable securities | (114) | 0 | 61 | 0 |
Total other comprehensive income (loss) | (114) | 0 | 61 | 0 |
Total comprehensive loss | $ (56,310) | $ (24,435) | $ (124,979) | $ (67,555) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income | Accumulated Deficit |
Beginning balance at Dec. 31, 2017 | $ 183,973 | $ 0 | $ 326 | $ 379,516 | $ 0 | $ (195,869) |
Beginning balance (in shares) at Dec. 31, 2017 | 0 | 32,591,686 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock sold in public offering, net of underwriting discounts, commissions and offering costs | 185,259 | $ 50 | 185,209 | |||
Issuance of common stock sold in public offering, net of underwriting discounts, commissions and offering costs (in shares) | 4,945,000 | |||||
Issuance of common stock upon exercise of stock options | 808 | $ 1 | 807 | |||
Issuance of common stock upon exercise of stock options (in shares) | 124,515 | |||||
Stock-based compensation expense | 6,883 | 6,883 | ||||
Net loss | (67,555) | (67,555) | ||||
Ending balance at Sep. 30, 2018 | 309,368 | $ 0 | $ 377 | 572,415 | 0 | (263,424) |
Ending balance (in shares) at Sep. 30, 2018 | 0 | 37,661,201 | ||||
Beginning balance at Dec. 31, 2017 | 183,973 | $ 0 | $ 326 | 379,516 | 0 | (195,869) |
Beginning balance (in shares) at Dec. 31, 2017 | 0 | 32,591,686 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (99,900) | |||||
Ending balance at Dec. 31, 2018 | 279,981 | $ 0 | $ 377 | 575,327 | 0 | (295,723) |
Ending balance (in shares) at Dec. 31, 2018 | 0 | 37,676,760 | ||||
Beginning balance at Jun. 30, 2018 | 331,097 | $ 0 | $ 376 | 569,710 | 0 | (238,989) |
Beginning balance (in shares) at Jun. 30, 2018 | 0 | 37,633,450 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock upon exercise of stock options | 92 | $ 1 | 91 | |||
Issuance of common stock upon exercise of stock options (in shares) | 27,751 | |||||
Stock-based compensation expense | 2,614 | 2,614 | ||||
Net loss | (24,435) | (24,435) | ||||
Ending balance at Sep. 30, 2018 | 309,368 | $ 0 | $ 377 | 572,415 | 0 | (263,424) |
Ending balance (in shares) at Sep. 30, 2018 | 0 | 37,661,201 | ||||
Beginning balance at Dec. 31, 2018 | 279,981 | $ 0 | $ 377 | 575,327 | 0 | (295,723) |
Beginning balance (in shares) at Dec. 31, 2018 | 0 | 37,676,760 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock sold in public offering, net of underwriting discounts, commissions and offering costs | 431,780 | $ 124 | 431,656 | |||
Issuance of common stock sold in public offering, net of underwriting discounts, commissions and offering costs (in shares) | 12,432,431 | |||||
Issuance of common stock upon exercise of stock options | 3,706 | $ 9 | 3,697 | |||
Issuance of common stock upon exercise of stock options (in shares) | 934,721 | |||||
Stock-based compensation expense | 15,065 | 15,065 | ||||
Unrealized gains (losses) on marketable securities | 61 | 61 | ||||
Net loss | (125,040) | (125,040) | ||||
Ending balance at Sep. 30, 2019 | 605,553 | $ 0 | $ 510 | 1,025,745 | 61 | (420,763) |
Ending balance (in shares) at Sep. 30, 2019 | 0 | 51,043,912 | ||||
Beginning balance at Jun. 30, 2019 | 222,878 | $ 0 | $ 382 | 586,888 | 175 | (364,567) |
Beginning balance (in shares) at Jun. 30, 2019 | 0 | 38,215,108 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock sold in public offering, net of underwriting discounts, commissions and offering costs | 431,780 | $ 124 | 431,656 | |||
Issuance of common stock sold in public offering, net of underwriting discounts, commissions and offering costs (in shares) | 12,432,431 | |||||
Issuance of common stock upon exercise of stock options | 2,476 | $ 4 | 2,472 | |||
Issuance of common stock upon exercise of stock options (in shares) | 396,373 | |||||
Stock-based compensation expense | 4,729 | 4,729 | ||||
Unrealized gains (losses) on marketable securities | (114) | (114) | ||||
Net loss | (56,196) | (56,196) | ||||
Ending balance at Sep. 30, 2019 | $ 605,553 | $ 0 | $ 510 | $ 1,025,745 | $ 61 | $ (420,763) |
Ending balance (in shares) at Sep. 30, 2019 | 0 | 51,043,912 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||||
Net loss | $ (56,196) | $ (24,435) | $ (125,040) | $ (67,555) | $ (99,900) |
Adjustments to reconcile net loss to net cash flows used in operating activities: | |||||
Stock-based compensation expense | 15,065 | 6,883 | |||
Depreciation and amortization expense | 385 | 218 | |||
Net accretion of discounts on marketable securities | (2,270) | 0 | |||
Changes in operating assets and liabilities: | |||||
Prepaid expenses and other current assets | (427) | (3,231) | |||
Operating lease assets | 433 | 0 | |||
Accounts payable | 6,462 | 1,734 | |||
Accrued expenses and other current liabilities | 12,038 | 1,837 | |||
Operating lease liabilities | (446) | 0 | |||
Other long-term liabilities | 337 | 199 | |||
Net cash flows used in operating activities | (93,463) | (59,915) | |||
Cash flows from investing activities: | |||||
Purchases of marketable securities | (618,190) | 0 | |||
Maturities and sales of marketable securities | 159,639 | 0 | |||
Purchases of property and equipment | (3,210) | (822) | |||
Increase in restricted investments | (441) | (1,069) | |||
Net cash flows used in investing activities | (462,202) | (1,891) | |||
Cash flows from financing activities: | |||||
Proceeds from public offerings, net of underwriting discounts and commissions | 432,400 | 185,933 | |||
Repayment of notes payable to related party | (140) | (140) | |||
Payments of public offering costs | (353) | (674) | |||
Proceeds from exercise of stock options | 3,706 | 808 | |||
Net cash flows provided by financing activities | 435,613 | 185,927 | |||
Net increase (decrease) in cash and cash equivalents | (120,052) | 124,121 | |||
Cash and cash equivalents at beginning of period | 293,764 | 196,754 | 196,754 | ||
Cash and cash equivalents at end of period | $ 173,712 | $ 320,875 | 173,712 | 320,875 | $ 293,764 |
Supplemental disclosure of cash flow information: | |||||
Cash paid for interest | 55 | 64 | |||
Amounts capitalized under build-to-suit lease transactions | 0 | 11,574 | |||
Property and equipment purchases included in accrued expenses and other current liabilities | 883 | 0 | |||
Offering costs included in accrued expenses and other current liabilities | $ 267 | $ 0 |
Nature of the Business and Basi
Nature of the Business and Basis of Presentation | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of the Business and Basis of Presentation | Nature of the Business and Basis of Presentation Deciphera Pharmaceuticals, Inc. (the Company) is a clinical-stage biopharmaceutical company focused on improving the lives of cancer patients by addressing key mechanisms of drug resistance that limit the rate and/or durability of response to existing cancer therapies. The Company's small molecule drug candidates are directed against an important family of enzymes called kinases, known to be directly involved in the growth and spread of many cancers. The Company uses its deep understanding of kinase biology together with a proprietary chemistry library to purposefully design compounds that maintain kinases in a “switched off” or inactivated conformation. These investigational therapies comprise tumor-targeted agents designed to address therapeutic resistance causing mutations and immuno-targeted agents designed to control the activation of immunokinases that suppress critical immune system regulators, and agents designed to inhibit reprogramming of cancer cell metabolism. The Company has used its platform to develop a diverse pipeline of tumor-targeted, immuno-targeted, and metabolism-targeted drug candidates designed to improve outcomes for patients with cancer by improving the quality, rate and/or durability of their responses to treatment. The Company is subject to risks and uncertainties common to companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, ability to complete late-stage clinical trials, ability to obtain and maintain regulatory approvals, ability to prepare for and successfully launch drug candidates that are approved for marketing, compliance with government regulations and the ability to secure additional capital to fund operations. Drug candidates currently under development will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval, as well as building a commercial infrastructure, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel and infrastructure and extensive compliance-reporting capabilities. Even if the Company’s drug development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales. On October 2, 2017, immediately prior to the completion of its initial public offering (IPO), the Company engaged in a series of transactions whereby Deciphera Pharmaceuticals, LLC became a wholly owned subsidiary of Deciphera Pharmaceuticals, Inc., a Delaware corporation. As part of the transactions, shareholders of Deciphera Pharmaceuticals, LLC exchanged their shares of Deciphera Pharmaceuticals, LLC for shares of Deciphera Pharmaceuticals, Inc. on a one-for-5.65 basis (the Conversion). In October 2017 the Company completed the IPO, pursuant to which it issued and sold 8,166,496 shares of common stock at the IPO price of $17.00 per share, resulting in net proceeds of $124.6 million after deducting underwriting discounts and commissions and other offering expenses. Upon the closing of the IPO, the Company’s outstanding convertible preferred shares automatically converted into shares of common stock. In June 2018 the Company issued and sold 4,945,000 shares of its common stock in a follow-on public offering at a public offering price of $40.00 per share, resulting in net proceeds of $185.3 million after deducting underwriting discounts and commissions and other offering expenses. In the third quarter of 2019 the Company issued and sold 12,432,431 shares of its common stock in a follow-on public offering at a public offering price of $37.00 per share, resulting in net proceeds of $431.8 million after deducting underwriting discounts and commissions and other offering expenses. The accompanying consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business. Since inception, the Company has incurred recurring losses including net losses of $125.0 million and $99.9 million for the nine months ended September 30, 2019 and the year ended December 31, 2018, respectively. As of September 30, 2019, the Company had an accumulated deficit of $420.8 million. The Company expects to continue to generate operating losses in the foreseeable future. The Company expects that its cash, cash equivalents and marketable securities will be sufficient to fund its operating expenses, capital expenditure requirements and debt service payments through at least 12 months from the issuance date of these consolidated financial statements. The future viability of the Company is dependent on its ability to raise additional capital to fund its operations. The Company expects its expenses to increase substantially in connection with ongoing activities, particularly as the Company advances its preclinical activities and clinical trials for its drug candidates in development and engages in efforts to support commercialization should ripretinib receive regulatory approval. Accordingly, the Company will need to obtain substantial additional funding in connection with continuing operations. If the Company is unable to raise capital when needed, or on attractive terms, it could be forced to delay, reduce or eliminate its research or drug development programs or any future commercialization efforts. Although management continues to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company to fund continuing operations, if at all. These consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated. These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP or U.S. GAAP). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies 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, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, revenue recognition, the accrual for research and development expenses and the valuation of stock-based awards. 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 from those estimates. Unaudited Interim Financial Information The consolidated balance sheet at December 31, 2018 was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. The accompanying unaudited consolidated financial statements as of September 30, 2019 and for the three and nine months ended September 30, 2019 and 2018 have been prepared by the Company pursuant to the rules and regulations of the SEC for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The Company believes, however, that the disclosures are adequate to make the information presented not misleading. These consolidated financial statements should be read in conjunction with the Company’s audited financial statements and the notes thereto for the year ended December 31, 2018 included in the Company’s Annual Report on Form 10-K on file with the SEC. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s consolidated financial position as of September 30, 2019 and consolidated results of operations for the three and nine months ended September 30, 2019 and 2018 and consolidated cash flows for the nine months ended September 30, 2019 and 2018 have been made. The consolidated results of operations for the nine months ended September 30, 2019 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2019. Certain prior year amounts have been reclassified to conform to current year presentation. The supplemental disclosure of non-cash investing activities related to amounts capitalized under the Company’s build-to-suit lease transaction has been revised to $11.6 million from $17.9 million in the consolidated statement of cash flows for the nine months ended September 30, 2018. This error was considered immaterial by the Company for all affected periods. Fair Value Measurements Certain assets and liabilities are carried at fair value under GAAP. 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. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: • Level 1—Quoted prices in active markets for identical assets or liabilities. • Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data. • Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. The Company’s cash equivalents and marketable securities are carried at fair value, determined according to the fair value hierarchy described above (see Note 4). The carrying values of the Company’s accounts payable and accrued expenses approximate their fair values due to the short-term nature of these liabilities. Notes payable to a related party (see Note 7) are measured at carrying value in the consolidated balance sheets. The fair value of the Company’s outstanding notes payable to a related party as of September 30, 2019 and December 31, 2018 approximated $1.0 million and $1.1 million, respectively. The fair value of the outstanding debt was estimated using a discounted cash flow analysis based on current market interest rates for debt issuances with similar remaining years to maturity, adjusted for credit risk, which represents a Level 3 measurement. Revenue The Company accounts for its one license arrangement, entered into in June 2019 (see Note 3), under Accounting Standards Codification (ASC) Topic 606, Revenue From Contracts With Customers (ASC 606). Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price, including variable consideration, if any; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration to which it is entitled in exchange for the goods or services it transfers to the customer. The Company assesses the goods or services promised within each contract and determines those that are performance obligations. Arrangements that include rights to additional goods or services that are exercisable at a customer’s discretion are generally considered options. The Company assesses if these options provide a material right to the customer and if so, they are considered performance obligations. The identification of material rights requires judgments related to the determination of the value of the underlying license relative to the option exercise price, including assumptions about technical feasibility and the probability of developing a candidate that would be subject to the option rights. The exercise of a material right is accounted for as a contract modification for accounting purposes. The Company assesses whether each promised good or service is distinct for the purpose of identifying the performance obligations in the contract. This assessment involves subjective determinations and requires management to make judgments about the individual promised goods or services and whether such are separable from the other aspects of the contractual relationship. Promised goods and services are considered distinct provided that: (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (that is, the good or service is capable of being distinct) and (ii) the entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (that is, the promise to transfer the good or service is distinct within the context of the contract). In assessing whether a promised good or service is distinct, the Company considers factors such as the research, manufacturing and commercialization capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace. The Company also considers the intended benefit of the contract in assessing whether a promised good or service is separately identifiable from other promises in the contract. If a promised good or service is not distinct, an entity is required to combine that good or service with other promised goods or services until it identifies a bundle of goods or services that is distinct. The transaction price is then determined and allocated to the identified performance obligations in proportion to their standalone selling prices (SSP) on a relative SSP basis. SSP is determined at contract inception and is not updated to reflect changes between contract inception and when the performance obligations are satisfied. Determining the SSP for performance obligations requires significant judgment. In developing the SSP for a performance obligation, the Company considers applicable market conditions and relevant entity-specific factors, including factors that were contemplated in negotiating the agreement with the customer and estimated costs. The Company validates the SSP for performance obligations by evaluating whether changes in the key assumptions used to determine the SSP will have a significant effect on the allocation of arrangement consideration between multiple performance obligations. If the consideration promised in a contract includes a variable amount, the Company estimates the amount of consideration to which it will be entitled in exchange for transferring the promised goods or services to a customer. The Company determines the amount of variable consideration by using the expected value method or the most likely amount method. The Company includes the unconstrained amount of estimated variable consideration in the transaction price. The amount included in the transaction price is constrained to the amount for which it is probable that a significant reversal of cumulative revenue recognized will not occur. At the end of each subsequent reporting period, the Company re-evaluates the estimated variable consideration included in the transaction price 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 in the period of adjustment. If an arrangement includes development and regulatory milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company’s control or the licensee’s control, such as regulatory approvals, are generally not considered probable of being achieved until those approvals are received. For arrangements with licenses of intellectual property that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes royalty revenue and sales-based milestones at the later of (i) when the related sales occur, or (ii) when the performance obligation to which the royalty has been allocated has been satisfied. In determining the transaction price, the Company adjusts consideration for the effects of the time value of money if the timing of payments provides the Company with a significant benefit of financing. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the licensees and the transfer of the promised goods or services to the licensees will be one year or less. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) each performance obligation is satisfied, either at a point in time or over time, and if over time, recognition is based on the use of an output or input method. Comprehensive Loss Comprehensive loss includes net loss as well as other changes in stockholders’ equity that result from transactions and economic events other than those with shareholders. For the three months and nine months ended September 30, 2019, the Company’s other comprehensive income (loss) consisted of unrealized gains (losses) on marketable securities. For the three months and nine months ended September 30, 2018, there was no difference between net loss and comprehensive loss. Net 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 for the period. Diluted net income (loss) per share is computed by dividing the diluted net income (loss) by the weighted average number of common shares, including potential dilutive common shares assuming the dilutive effect as determined using the treasury stock method. For periods in which the Company has reported net losses, diluted net loss per common share is the same as basic net loss per common share, since dilutive common shares are not assumed to have been issued if their effect is antidilutive. The Company reported a net loss for each of the three and nine months ended September 30, 2019 and 2018. The following potential dilutive securities, presented based on amounts outstanding at the end of each reporting period, have been excluded from the calculation of diluted net loss per share because including them would have had an anti-dilutive impact: As of September 30, 2019 2018 Options to purchase common stock 6,891,125 5,810,507 Unvested restricted common stock units 67,000 20,000 6,958,125 5,830,507 Recently Adopted Accounting Pronouncements Leases In February 2016 the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) (ASU 2016-02). ASU 2016-02 requires lessees to recognize leases on their balance sheet as a right-of-use asset and a lease liability as well as provide disclosures with respect to certain qualitative and quantitative information related to a company's leasing arrangements to meet the objective of allowing users of financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. Leases are classified as either operating or finance, and classification is based on criteria similar to current lease accounting, but without explicit bright lines. The guidance is effective for annual reporting periods beginning after December 15, 2018 and interim periods within those fiscal years, and early adoption is permitted. The FASB subsequently issued the following amendments to ASU 2016-02 that have the same effective date and transition date: ASU No. 2018-01, Leases (Topic 842): Land Easement Practical Expedient for Transition to Topic 842 , ASU No. 2018-10, Codification Improvements to Topic 842, Leases , ASU No. 2018-11, Leases (Topic 842): Targeted Improvements , ASU No. 2018-20, Narrow-Scope Improvement for Lessors , and ASU No. 2019-01, Leases (Topic 842): Codification Improvements . The Company adopted these amendments with ASU 2016-02 (collectively, the new leasing standards) effective January 1, 2019. The Company adopted the new leasing standards using a modified retrospective approach, as of January 1, 2019, with no restatement of prior periods or cumulative adjustment to retained earnings. The Company elected the package of practical expedients, which permits the Company not to reassess under the new standards for prior conclusions about lease identification, lease classification and initial direct costs. The Company did not apply the hindsight practical expedient when determining the lease term for existing leases and assessing impairment of expired or existing leases. The Company did not apply the recognition requirements to short-term leases and recognizes those lease payments in the consolidated statements of operations and comprehensive loss on a straight-line basis over the lease term. The Company elected the practical expedient to not separate lease and non-lease components for real estate leases. The Company elected to utilize its incremental borrowing rate based on the remaining lease term as of the date of adoption. In connection with the adoption, the Company recognized right-of-use assets of $0.8 million and lease liabilities of $0.8 million on its consolidated balance sheet. The underlying assets of the Company’s leases consist of office and laboratory space. In addition, the Company reversed its build to suit asset of $11.9 million and related liabilities of $11.9 million under the new leasing standards as the Company was no longer deemed the owner of the leased space (see Note 5). The adoption of the standard did not have a material impact on the Company’s results of operations or cash flows. The Company accounts for a contract as a lease when it has the right to control the asset for a period of time while obtaining substantially all of the asset’s economic benefits. The Company determines if an arrangement is a lease or contains an embedded lease at inception. For arrangements that meet the definition of a lease, the Company determines the initial classification and measurement of its operating right-of-use asset and operating lease liability at the lease commencement date and thereafter if modified. The lease term includes any renewal options that the Company is reasonably assured to exercise. The present value of lease payments is determined by using the interest rate implicit in the lease, if that rate is readily determinable; otherwise, the Company uses its estimated secured incremental borrowing rate for that lease term. In addition to rent, the leases may require the Company to pay additional amounts for taxes, insurance, maintenance and other expenses, which are generally referred to as non-lease components. The Company has elected to not separate lease and non-lease components. Only the fixed costs for lease components and their associated non-lease components are accounted for as a single lease component and recognized as part of a right-of-use asset and liability. Rent expense is recognized on a straight-line basis over the reasonably assured lease term based on the total lease payments and is included in operating expenses in the consolidated statements of operations and comprehensive loss. Stock-Based Awards In September 2018 the FASB issued ASU No. 2018-07, Compensation-Stock Compensation (Topic 718) – Improvements to Nonemployee Share-Based Payment Accounting (ASU 2018-07). This ASU is intended to simplify aspects of share-based compensation issued to non-employees by making the guidance consistent with the accounting for employee share-based compensation. The guidance is effective for annual reporting periods beginning after December 15, 2018 and interim periods within those fiscal years, and early adoption is permitted. The Company adopted ASU 2018-07 as of January 1, 2019, which had no impact on the Company’s financial position, results of operations or cash flows. |
License Agreement
License Agreement | 9 Months Ended |
Sep. 30, 2019 | |
License Agreement [Abstract] | |
License Agreement | License Agreement Zai Lab (Shanghai) Co., Ltd. (Zai) License Agreement In June 2019 the Company entered into a License Agreement (the Zai License Agreement) with an affiliate of Zai Lab (Shanghai) Co., Ltd. (Zai), pursuant to which the Company granted Zai exclusive rights to develop and commercialize ripretinib, including certain follow-on compounds (the Licensed Products), in Mainland China, Hong Kong, Macau and Taiwan, each a Region and collectively the Territory. The Company retains exclusive rights to, among other things, develop, manufacture and commercialize the Licensed Products outside the Territory. Pursuant to the terms of the Zai License Agreement, the Company received an upfront cash payment of $20.0 million and will be eligible to receive up to $185.0 million in potential development and commercial milestone payments, consisting of up to $50.0 million of development milestones and up to $135.0 million of commercial milestones. In addition, during the term of the Zai License Agreement, Zai will be obligated to pay the Company tiered percentage royalties ranging from low to high teens on potential annual net sales of the Licensed Products in the Territory, subject to adjustments in specified circumstances. During the second quarter of 2019, the Company achieved a $5.0 million INTRIGUE study-related development milestone payment. Subject to the terms and conditions of the Zai License Agreement, Zai will be responsible for conducting the development and commercialization activities in the Territory related to the Licensed Products. Subject to specified exceptions, during the term of the Zai License Agreement, each party has agreed that neither it nor its affiliates nor, with respect to Zai, its sublicensees, will conduct any development, manufacturing and commercialization activities in the Territory that may be deemed competitive with the Licensed Products. In addition, under the Zai License Agreement, each party has granted the other party specified intellectual property licenses to enable the other party to perform its obligations and exercise its rights under the Zai License Agreement, including license grants to enable each party to conduct research, development and commercialization activities pursuant to the terms of the Zai License Agreement. The Company will supply or have supplied to Zai the Licensed Product pursuant to a supply agreement and for agreed upon consideration. The Zai License Agreement will continue on a Licensed Product-by-Licensed Product and region-by-region basis until the later of (i) the abandonment, expiry or final determination of invalidity of the last valid claim within the Company’s patent rights that covers the Licensed Product in such region in the Territory; (ii) the expiry of the regulatory exclusivity for such Licensed Product in such region; or (iii) the close of business of the day that is exactly ten (10) years after the date of the first commercial sale of such Licensed Product in such region. Subject to the terms of the Zai License Agreement, Zai may terminate the Zai License Agreement for convenience by providing written notice to the Company, which termination will be effective following a prescribed notice period. In addition, the Company may terminate the Zai License Agreement under specified circumstances if Zai or certain other parties challenge our patent rights or if Zai or its affiliates do not conduct certain development activities with respect to one or more Licensed Products for a specified period of time, subject to specified exceptions. Either party may terminate the Zai License Agreement for the other party’s uncured material breach of a material term of the Zai License Agreement, with a customary notice and cure period, or insolvency. After termination (but not natural expiration), the Company is entitled to retain a worldwide and perpetual license from Zai to exploit the Licensed Products. On a region-by-region and a Licensed Product-by-Licensed Product basis, upon the natural expiration of the Zai License Agreement as described above, the licenses granted by the Company to Zai under the Zai License Agreement in such region with respect to the Licensed Product become fully paid-up, perpetual and irrevocable. The Company identified the following promises under the Zai License Agreement: (1) the exclusive license, with the right to grant sublicenses, granted in the Territory for the Licensed Products; (2) initial and continuing know-how transfer for the Licensed Products; (3) clinical supply of the Licensed Products; (4) participation in the joint steering committee (the JSC); and (5) regulatory and technical assistance responsibilities. The Company determined that the exclusive license is distinct and constitutes one performance obligation that is a right to use the Company’s intellectual property. The Company determined that the promises under the Zai License Agreement related to the know-how transfer, clinical supply, participation in the JSC and the assistance responsibilities are immaterial in the context of the Zai License Agreement and therefore are excluded from the assessment of performance obligations. The Company also evaluated certain options and contingent obligations contained within the Zai License Agreement to determine if they provide Zai with any material rights. The Company concluded that the options and contingent obligations were not issued at a significant and incremental discount, and therefore do not provide Zai with a material right. As such, these options and contingent obligations were excluded as performance obligations and will be accounted for if and when they occur or are exercised. The Company determined that the upfront payment of $20.0 million and the $5.0 million development milestone that the Company believed was probable of achievement and that a significant reversal of cumulative revenue would not occur upon resolution of the uncertainty constitutes the consideration to be included in the transaction price as of the commencement of the arrangement. The transaction price was allocated to the one performance obligation which was satisfied at a point in time upon delivery of the license in June 2019 and therefore the Company recognized license revenue of $25.0 million during the second quarter of 2019. The first development milestone was achieved in July 2019 and therefore, within the total $25.0 million of license revenue recognized, the Company recognized revenue of $5.0 million related to the development milestone achieved during the second quarter of 2019. The remaining potential milestone payments that the Company is eligible to receive were excluded from the transaction price and were fully constrained based on the probability of achievement. The Company will reevaluate the transaction price at the end of each reporting period and as uncertain events are resolved or other changes in circumstances occur, and if necessary, the Company will adjust its estimate of the transaction price. Because the performance obligation has been satisfied, any additions to the transaction price would be reflected in the period as a cumulative revenue catch-up. The Company assessed the License Agreement to determine whether a significant financing component exists and concluded that a significant financing component does not exist. |
Marketable Securities and Fair
Marketable Securities and Fair Value Measurements | 9 Months Ended |
Sep. 30, 2019 | |
Investments, All Other Investments [Abstract] | |
Marketable Securities and Fair Value Measurements | Marketable Securities and Fair Value Measurements As of September 30, 2019, marketable securities by security type consisted of: (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Commercial paper (due within one year) $ 274,354 $ 89 $ (42) $ 274,401 U.S. Government securities (due within one year) 142,243 43 (41) 142,245 Certificates of deposit (due within one year) 44,225 18 (6) 44,237 Total $ 460,822 $ 150 $ (89) $ 460,883 The Company had no marketable securities as of December 31, 2018. 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: As of September 30, 2019 (in thousands) Level 1 Level 2 Level 3 Total Cash equivalents: Commercial paper $ — $ 80,246 $ — $ 80,246 Money market funds — 25,716 — 25,716 Certificates of deposit — 13,099 — 13,099 Marketable securities: Commercial paper — 274,401 — 274,401 U.S. Government securities — 142,245 — 142,245 Certificates of deposit — 44,237 — 44,237 Total $ — $ 579,944 $ — $ 579,944 As of December 31, 2018 (in thousands) Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ — $ 267,145 $ — $ 267,145 Total $ — $ 267,145 $ — $ 267,145 The table above excludes certificates of deposit totaling $1.5 million and $1.1 million as of September 30, 2019 and December 31, 2018, respectively, that the Company held to secure a letter of credit associated with a lease (see Note 5) and to secure a credit card account. The certificates of deposit are measured at carrying value in the consolidated balance sheets in long-term investment—restricted and approximate fair value. During the three and nine months ended September 30, 2019 and 2018, there were no transfers between Level 1, Level 2 and Level 3. The fair value of Level 2 instruments classified as cash equivalents and marketable securities were determined through third-party pricing services. The pricing services use many observable market inputs to determine value, including reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers, current spot rates and other industry and economic events. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company leases real estate, including office and laboratory space. The Company has two five In addition, in August 2018, the Company entered into a nine three The Company’s leases require the Company to pay for certain operating expenses based on actual costs incurred and therefore, as the amounts are variable in nature, are expensed in the period incurred and included in variable lease costs for the three and nine months ended September 30, 2019. Payment escalations specified in the lease are recognized on a straight-line basis over the lease terms. All of the Company's leases qualify as operating leases. The following table summarizes the presentation of the Company's operating leases in the consolidated balance sheet: (in thousands) As of September 30, 2019 Operating lease assets $ 522 Current operating lease liabilities $ 415 Operating lease liabilities, net of current portion 107 Total operating lease liabilities $ 522 The components of lease expense were as follows: (in thousands) Three Months Ended Nine Months Ended Operating lease cost $ 104 $ 462 Short-term lease cost 82 270 Variable lease cost 128 337 $ 314 $ 1,069 Future annual minimum lease payments under operating leases were as follows: (in thousands) As of September 30, 2019 Remainder of 2019 (three months) $ 108 2020 433 Total future minimum lease payments 541 Less: imputed interest (19) Total operating lease liabilities $ 522 As previously disclosed in the Company’s 2018 Annual Report on Form 10-K and under the previous lease accounting standard, ASC 840, Leases, the following table summarizes the future minimum lease payments due under the operating leases as of December 31, 2018: (in thousands) As of December 31, 2018 2019 $ 726 2020 333 $ 1,059 The weighted-average remaining lease term and weighted-average discount rate of the Company's operating leases are as follows: As of September 30, 2019 Weighted-average remaining lease term in years 1.17 Weighted-average discount rate 5.37 % Supplemental disclosure of cash flow information related to the Company's operating leases included in cash flows used in operating activities in the consolidated statement of cash flows is as follows: (in thousands) Three Months Ended Nine Months Ended Cash paid for amounts included in the measurement of operating lease liabilities $ 104 $ 424 Operating lease liabilities arising from obtaining operating lease assets $ 142 $ 142 In May 2018 the Company entered into a lease for office space at 200 Smith Street in Waltham, Massachusetts (the Premises). The initial term of the lease expires in November 2029, unless terminated earlier in accordance with the terms of the lease. The Company is entitled to two five Prior to the adoption of ASU 2016-02, the Company was deemed to be the owner of this leased space during the construction period because of certain provisions within the lease agreement. As a result, as of December 31, 2018, the Company capitalized approximately $11.9 million (equal to the estimated cost of its leased portion of the premises) as construction-in-progress within property and equipment, net and recorded a corresponding build-to-suit facility lease financing obligation. Under ASU 2016-02, the Company was no longer considered the owner of the leased space and therefore the build-to suit asset and corresponding liabilities at December 31, 2018 were reversed as of the date of adoption on January 1, 2019 as the lease commencement date had not yet been met. In October 2019 the lease commencement date under ASU 2016-02 was met and will result in the addition of an operating lease asset and corresponding lease liability in the fourth quarter of 2019. The Premises became the Company's new headquarters location in October 2019. As previously disclosed in the Company’s 2018 Annual Report on Form 10-K and under the previous lease accounting standard, ASC 840, Leases, as of December 31, 2018, minimum commitments under this lease were as follows: (in thousands) As of December 31, 2018 2019 $ 170 2020 2,043 2021 2,088 2022 2,132 2023 2,177 Thereafter 13,783 $ 22,393 In April 2019 the Company amended its lease for office space at the Premises to add an additional 38,003 square feet of space for a total of 82,346 square feet of space, which is expected to commence in early 2020. The initial term of the lease for the additional space will expire in November 2029 unless terminated earlier in accordance with the terms of the lease and the Company is entitled to two five |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following: (in thousands) September 30, 2019 December 31, 2018 External research and development expenses $ 15,377 $ 8,761 Payroll and related expenses 7,664 4,139 Professional fees 2,421 747 Other 1,422 62 Total accrued expenses and other current liabilities $ 26,884 $ 13,709 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Clinical Reference Laboratory, Inc. One of the members of the Company’s board of directors was the Chief Executive Officer of Clinical Reference Laboratory, Inc. (CRL) during the third quarter of 2019. CRL is an owner of Brightstar, a holder of more than 5% of the Company’s common stock. The Company is a party to a loan agreement and a security agreement, each dated as of June 11, 2010, with CRL. The Company borrowed an aggregate of $2.8 million under the loan agreement to finance improvements to the Company’s biology and chemistry laboratories in Lawrence, Kansas. In December 2016 the loan was assigned to CHC, Inc., a related party, which owns 100% of CRL. Borrowings under the loan bear interest at a fixed rate equal to 6% per annum and the Company is required to make monthly payments of principal and interest, based on a 15-year straight-line amortization schedule. For the three months ended September 30, 2019 and 2018, the Company recorded less than $0.1 million of interest expense related to this loan. For the nine months ended September 30, 2019 and 2018, the Company recorded $0.1 million of interest expense related to this loan. For the three months ended September 30, 2019 and 2018, the Company made less than $0.1 million in principal and interest payments under the loan. For the nine months ended September 30, 2019 and 2018, the Company made $0.2 million in principal and interest payments under the loan. As of September 30, 2019 and December 31, 2018, principal amounts owed under the loan agreement totaled $1.2 million and $1.3 million, respectively (see the “Notes Payable to Related Party” section below). The Company is party to a master services agreement, effective as of May 20, 2013, with CRL under which the Company purchased and expects to continue to purchase laboratory services. Under the agreement, the Company has agreed to use CRL on an exclusive basis for certain laboratory testing needs. For the three months ended September 30, 2019 and 2018, the Company recorded $0.2 million of research and development expense incurred under this agreement, and $0.3 million and $0.1 million, respectively, was paid to CRL during those same periods. For the nine months ended September 30, 2019 and 2018, the Company recorded $0.5 million and $0.7 million, respectively, of research and development expense incurred under this agreement and $0.6 million and $0.5 million, respectively, was paid to CRL during those same periods. As of September 30, 2019 and December 31, 2018, total amounts owed to CRL for laboratory services were $0.1 million and $0.2 million, respectively, which were included in accounts payable and accrued expenses in the consolidated balance sheets. The Company is not committed to purchase any minimum amounts under the agreement. Notes Payable to Related Party Notes payable to related party as of September 30, 2019 and December 31, 2018 is as follows: (in thousands) September 30, 2019 December 31, 2018 Notes payable to related party $ 1,154 $ 1,294 Less: Current portion (187) (187) Notes payable to related party, net of current portion $ 967 $ 1,107 |
Stock-Based Awards
Stock-Based Awards | 9 Months Ended |
Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Awards | Stock-Based Awards The Company grants stock-based awards under its 2017 Stock Option and Incentive Plan (the 2017 Plan) and is authorized to issue common stock under its 2017 Employee Stock Purchase Plan (ESPP). The Company also has outstanding stock options under its 2015 Equity Incentive Plan but is no longer granting awards under this plan. As of September 30, 2019, 1,517,723 shares of common stock were available for issuance under the 2017 Plan. As of September 30, 2019, 1,009,433 shares of common stock were available for issuance to participating employees under the ESPP. Stock-based compensation expense was classified in the statements of operations and comprehensive loss as follows: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 Research and development expenses $ 1,992 $ 1,069 $ 5,474 $ 3,014 General and administrative expenses 2,737 1,545 9,591 3,869 Total $ 4,729 $ 2,614 $ 15,065 $ 6,883 As of September 30, 2019, total unrecognized compensation cost related to the unvested share-based awards was $52.4 million, which is expected to be recognized over a weighted average of 2.8 years. During the nine months ended September 30, 2019, the Company recorded $2.4 million of stock-based compensation expense related to the modification of stock options pursuant to the transition agreement with its former President and Chief Executive Officer. |
Savings Plan 401(k)
Savings Plan 401(k) | 9 Months Ended |
Sep. 30, 2019 | |
Retirement Benefits [Abstract] | |
401(k) Savings Plan | 401(k) Savings Plan Effective January 1, 2018, the Company adopted the Deciphera Pharmaceuticals 401(k) Plan (the 401(k) Plan), a defined contribution plan under Section 401(k) of the Internal Revenue Code, whereby the Company provides matching contributions of 100% of each employee’s contribution up to a maximum matching contribution of 3% of the employee’s eligible compensation and at a rate of 50% of each employee’s contribution in excess of 3% up to a maximum of 5% of the employee’s eligible compensation. Total employer matching contributions related to the 401(k) Plan were $0.2 million and $0.1 million for the three months ended September 30, 2019 and 2018, respectively, and $0.7 million and $0.3 million for the nine months ended September 30, 2019 and 2018, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies KBA Grants Prior to 2014 the Company received funding from two research and development grants from the Kansas Bioscience Authority (KBA), totaling $2.0 million and no further amounts will be received under these grants. Pursuant to Kansas law, the Company may be required to repay some or all of the financial assistance received from the KBA, subject to the discretion of the KBA, if the Company relocates the operations in which the KBA invested outside of the State of Kansas, if the Company initiates procedures to dissolve and wind up or cease operations within ten years after receiving such financial assistance or upon certain significant changes to ownership of the Company. The Company will only account for the repayment of the grants if it becomes probable that the Company will be required to repay any funds previously received. Legal Proceedings The Company is not currently a party to any material legal proceedings. At each reporting date, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. The Company expenses the costs related to its legal proceedings as they are incurred. Indemnification Agreements In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters including, but not limited to, losses arising out of breach |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
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, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, revenue recognition, the accrual for research and development expenses and the valuation of stock-based awards. 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 from those estimates. |
Unaudited Interim Financial Information | Unaudited Interim Financial Information The consolidated balance sheet at December 31, 2018 was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. The accompanying unaudited consolidated financial statements as of September 30, 2019 and for the three and nine months ended September 30, 2019 and 2018 have been prepared by the Company pursuant to the rules and regulations of the SEC for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The Company believes, however, that the disclosures are adequate to make the information presented not misleading. These consolidated financial statements should be read in conjunction with the Company’s audited financial statements and the notes thereto for the year ended December 31, 2018 included in the Company’s Annual Report on Form 10-K on file with the SEC. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s consolidated financial position as of September 30, 2019 and consolidated results of operations for the three and nine months ended September 30, 2019 and 2018 and consolidated cash flows for the nine months ended September 30, 2019 and 2018 have been made. The consolidated results of operations for the nine months ended September 30, 2019 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2019. Certain prior year amounts have been reclassified to conform to current year presentation. The supplemental disclosure of non-cash investing activities related to amounts capitalized under the Company’s build-to-suit lease transaction has been revised to $11.6 million from $17.9 million in the consolidated statement of cash flows for the nine months ended September 30, 2018. This error was considered immaterial by the Company for all affected periods. |
Fair Value Measurements | Fair Value Measurements Certain assets and liabilities are carried at fair value under GAAP. 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. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: • Level 1—Quoted prices in active markets for identical assets or liabilities. • Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data. • Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. The Company’s cash equivalents and marketable securities are carried at fair value, determined according to the fair value hierarchy described above (see Note 4). The carrying values of the Company’s accounts payable and accrued expenses approximate their fair values due to the short-term nature of these liabilities. Notes payable to a related party (see Note 7) are measured at carrying value in the consolidated balance sheets. The fair value of the Company’s outstanding notes payable to a related party as of September 30, 2019 and December 31, 2018 approximated $1.0 million and $1.1 million, respectively. The fair value of the outstanding debt was estimated using a discounted cash flow analysis based on current market interest rates for debt issuances with similar remaining years to maturity, adjusted for credit risk, which represents a Level 3 measurement. |
Revenue | Revenue The Company accounts for its one license arrangement, entered into in June 2019 (see Note 3), under Accounting Standards Codification (ASC) Topic 606, Revenue From Contracts With Customers (ASC 606). Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price, including variable consideration, if any; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration to which it is entitled in exchange for the goods or services it transfers to the customer. The Company assesses the goods or services promised within each contract and determines those that are performance obligations. Arrangements that include rights to additional goods or services that are exercisable at a customer’s discretion are generally considered options. The Company assesses if these options provide a material right to the customer and if so, they are considered performance obligations. The identification of material rights requires judgments related to the determination of the value of the underlying license relative to the option exercise price, including assumptions about technical feasibility and the probability of developing a candidate that would be subject to the option rights. The exercise of a material right is accounted for as a contract modification for accounting purposes. The Company assesses whether each promised good or service is distinct for the purpose of identifying the performance obligations in the contract. This assessment involves subjective determinations and requires management to make judgments about the individual promised goods or services and whether such are separable from the other aspects of the contractual relationship. Promised goods and services are considered distinct provided that: (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (that is, the good or service is capable of being distinct) and (ii) the entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (that is, the promise to transfer the good or service is distinct within the context of the contract). In assessing whether a promised good or service is distinct, the Company considers factors such as the research, manufacturing and commercialization capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace. The Company also considers the intended benefit of the contract in assessing whether a promised good or service is separately identifiable from other promises in the contract. If a promised good or service is not distinct, an entity is required to combine that good or service with other promised goods or services until it identifies a bundle of goods or services that is distinct. The transaction price is then determined and allocated to the identified performance obligations in proportion to their standalone selling prices (SSP) on a relative SSP basis. SSP is determined at contract inception and is not updated to reflect changes between contract inception and when the performance obligations are satisfied. Determining the SSP for performance obligations requires significant judgment. In developing the SSP for a performance obligation, the Company considers applicable market conditions and relevant entity-specific factors, including factors that were contemplated in negotiating the agreement with the customer and estimated costs. The Company validates the SSP for performance obligations by evaluating whether changes in the key assumptions used to determine the SSP will have a significant effect on the allocation of arrangement consideration between multiple performance obligations. If the consideration promised in a contract includes a variable amount, the Company estimates the amount of consideration to which it will be entitled in exchange for transferring the promised goods or services to a customer. The Company determines the amount of variable consideration by using the expected value method or the most likely amount method. The Company includes the unconstrained amount of estimated variable consideration in the transaction price. The amount included in the transaction price is constrained to the amount for which it is probable that a significant reversal of cumulative revenue recognized will not occur. At the end of each subsequent reporting period, the Company re-evaluates the estimated variable consideration included in the transaction price 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 in the period of adjustment. If an arrangement includes development and regulatory milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company’s control or the licensee’s control, such as regulatory approvals, are generally not considered probable of being achieved until those approvals are received. For arrangements with licenses of intellectual property that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes royalty revenue and sales-based milestones at the later of (i) when the related sales occur, or (ii) when the performance obligation to which the royalty has been allocated has been satisfied. In determining the transaction price, the Company adjusts consideration for the effects of the time value of money if the timing of payments provides the Company with a significant benefit of financing. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the licensees and the transfer of the promised goods or services to the licensees will be one year or less. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) each performance obligation is satisfied, either at a point in time or over time, and if over time, recognition is based on the use of an output or input method. |
Comprehensive Loss | Comprehensive LossComprehensive loss includes net loss as well as other changes in stockholders’ equity that result from transactions and economic events other than those with shareholders. |
Net Loss per Share | Net 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 for the period. Diluted net income (loss) per share is computed by dividing the diluted net income (loss) by the weighted average number of common shares, including potential dilutive common shares assuming the dilutive effect as determined using the treasury stock method. For periods in which the Company has reported net losses, diluted net loss per common share is the same as basic net loss per common share, since dilutive common shares are not assumed to have been issued if their effect is antidilutive. The Company reported a net loss for each of the three and nine months ended September 30, 2019 and 2018. The following potential dilutive securities, presented based on amounts outstanding at the end of each reporting period, have been excluded from the calculation of diluted net loss per share because including them would have had an anti-dilutive impact: As of September 30, 2019 2018 Options to purchase common stock 6,891,125 5,810,507 Unvested restricted common stock units 67,000 20,000 6,958,125 5,830,507 |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements Leases In February 2016 the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) (ASU 2016-02). ASU 2016-02 requires lessees to recognize leases on their balance sheet as a right-of-use asset and a lease liability as well as provide disclosures with respect to certain qualitative and quantitative information related to a company's leasing arrangements to meet the objective of allowing users of financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. Leases are classified as either operating or finance, and classification is based on criteria similar to current lease accounting, but without explicit bright lines. The guidance is effective for annual reporting periods beginning after December 15, 2018 and interim periods within those fiscal years, and early adoption is permitted. The FASB subsequently issued the following amendments to ASU 2016-02 that have the same effective date and transition date: ASU No. 2018-01, Leases (Topic 842): Land Easement Practical Expedient for Transition to Topic 842 , ASU No. 2018-10, Codification Improvements to Topic 842, Leases , ASU No. 2018-11, Leases (Topic 842): Targeted Improvements , ASU No. 2018-20, Narrow-Scope Improvement for Lessors , and ASU No. 2019-01, Leases (Topic 842): Codification Improvements . The Company adopted these amendments with ASU 2016-02 (collectively, the new leasing standards) effective January 1, 2019. The Company adopted the new leasing standards using a modified retrospective approach, as of January 1, 2019, with no restatement of prior periods or cumulative adjustment to retained earnings. The Company elected the package of practical expedients, which permits the Company not to reassess under the new standards for prior conclusions about lease identification, lease classification and initial direct costs. The Company did not apply the hindsight practical expedient when determining the lease term for existing leases and assessing impairment of expired or existing leases. The Company did not apply the recognition requirements to short-term leases and recognizes those lease payments in the consolidated statements of operations and comprehensive loss on a straight-line basis over the lease term. The Company elected the practical expedient to not separate lease and non-lease components for real estate leases. The Company elected to utilize its incremental borrowing rate based on the remaining lease term as of the date of adoption. In connection with the adoption, the Company recognized right-of-use assets of $0.8 million and lease liabilities of $0.8 million on its consolidated balance sheet. The underlying assets of the Company’s leases consist of office and laboratory space. In addition, the Company reversed its build to suit asset of $11.9 million and related liabilities of $11.9 million under the new leasing standards as the Company was no longer deemed the owner of the leased space (see Note 5). The adoption of the standard did not have a material impact on the Company’s results of operations or cash flows. The Company accounts for a contract as a lease when it has the right to control the asset for a period of time while obtaining substantially all of the asset’s economic benefits. The Company determines if an arrangement is a lease or contains an embedded lease at inception. For arrangements that meet the definition of a lease, the Company determines the initial classification and measurement of its operating right-of-use asset and operating lease liability at the lease commencement date and thereafter if modified. The lease term includes any renewal options that the Company is reasonably assured to exercise. The present value of lease payments is determined by using the interest rate implicit in the lease, if that rate is readily determinable; otherwise, the Company uses its estimated secured incremental borrowing rate for that lease term. In addition to rent, the leases may require the Company to pay additional amounts for taxes, insurance, maintenance and other expenses, which are generally referred to as non-lease components. The Company has elected to not separate lease and non-lease components. Only the fixed costs for lease components and their associated non-lease components are accounted for as a single lease component and recognized as part of a right-of-use asset and liability. Rent expense is recognized on a straight-line basis over the reasonably assured lease term based on the total lease payments and is included in operating expenses in the consolidated statements of operations and comprehensive loss. Stock-Based Awards In September 2018 the FASB issued ASU No. 2018-07, Compensation-Stock Compensation (Topic 718) – Improvements to Nonemployee Share-Based Payment Accounting (ASU 2018-07). This ASU is intended to simplify aspects of share-based compensation issued to non-employees by making the guidance consistent with the accounting for employee share-based compensation. The guidance is effective for annual reporting periods beginning after December 15, 2018 and interim periods within those fiscal years, and early adoption is permitted. The Company adopted ASU 2018-07 as of January 1, 2019, which had no impact on the Company’s financial position, results of operations or cash flows. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Potential Dilutive Securities | The following potential dilutive securities, presented based on amounts outstanding at the end of each reporting period, have been excluded from the calculation of diluted net loss per share because including them would have had an anti-dilutive impact: As of September 30, 2019 2018 Options to purchase common stock 6,891,125 5,810,507 Unvested restricted common stock units 67,000 20,000 6,958,125 5,830,507 |
Marketable Securities and Fai_2
Marketable Securities and Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Investments, All Other Investments [Abstract] | |
Schedule of Marketable Securities | As of September 30, 2019, marketable securities by security type consisted of: (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Commercial paper (due within one year) $ 274,354 $ 89 $ (42) $ 274,401 U.S. Government securities (due within one year) 142,243 43 (41) 142,245 Certificates of deposit (due within one year) 44,225 18 (6) 44,237 Total $ 460,822 $ 150 $ (89) $ 460,883 |
Schedule of Financial Assets Measured at Fair Value on a Recurring Basis | 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: As of September 30, 2019 (in thousands) Level 1 Level 2 Level 3 Total Cash equivalents: Commercial paper $ — $ 80,246 $ — $ 80,246 Money market funds — 25,716 — 25,716 Certificates of deposit — 13,099 — 13,099 Marketable securities: Commercial paper — 274,401 — 274,401 U.S. Government securities — 142,245 — 142,245 Certificates of deposit — 44,237 — 44,237 Total $ — $ 579,944 $ — $ 579,944 As of December 31, 2018 (in thousands) Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ — $ 267,145 $ — $ 267,145 Total $ — $ 267,145 $ — $ 267,145 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Operating Leases in the Consolidated Balance Sheet | All of the Company's leases qualify as operating leases. The following table summarizes the presentation of the Company's operating leases in the consolidated balance sheet: (in thousands) As of September 30, 2019 Operating lease assets $ 522 Current operating lease liabilities $ 415 Operating lease liabilities, net of current portion 107 Total operating lease liabilities $ 522 |
Components of Lease Expense | The components of lease expense were as follows: (in thousands) Three Months Ended Nine Months Ended Operating lease cost $ 104 $ 462 Short-term lease cost 82 270 Variable lease cost 128 337 $ 314 $ 1,069 |
Future Annual Minimum Lease Payments Under Operating Leases | Future annual minimum lease payments under operating leases were as follows: (in thousands) As of September 30, 2019 Remainder of 2019 (three months) $ 108 2020 433 Total future minimum lease payments 541 Less: imputed interest (19) Total operating lease liabilities $ 522 |
Summary of Future Minimum Lease Payments under Operating Leases | As previously disclosed in the Company’s 2018 Annual Report on Form 10-K and under the previous lease accounting standard, ASC 840, Leases, the following table summarizes the future minimum lease payments due under the operating leases as of December 31, 2018: (in thousands) As of December 31, 2018 2019 $ 726 2020 333 $ 1,059 |
Weighted-Average Remaining Lease Term and Discount Rate | The weighted-average remaining lease term and weighted-average discount rate of the Company's operating leases are as follows: As of September 30, 2019 Weighted-average remaining lease term in years 1.17 Weighted-average discount rate 5.37 % |
Supplemental Cash Flow Information | Supplemental disclosure of cash flow information related to the Company's operating leases included in cash flows used in operating activities in the consolidated statement of cash flows is as follows: (in thousands) Three Months Ended Nine Months Ended Cash paid for amounts included in the measurement of operating lease liabilities $ 104 $ 424 Operating lease liabilities arising from obtaining operating lease assets $ 142 $ 142 |
Schedule of Future Minimum Lease Payments for Capital Leases | As previously disclosed in the Company’s 2018 Annual Report on Form 10-K and under the previous lease accounting standard, ASC 840, Leases, as of December 31, 2018, minimum commitments under this lease were as follows: (in thousands) As of December 31, 2018 2019 $ 170 2020 2,043 2021 2,088 2022 2,132 2023 2,177 Thereafter 13,783 $ 22,393 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consisted of the following: (in thousands) September 30, 2019 December 31, 2018 External research and development expenses $ 15,377 $ 8,761 Payroll and related expenses 7,664 4,139 Professional fees 2,421 747 Other 1,422 62 Total accrued expenses and other current liabilities $ 26,884 $ 13,709 |
Related Party Disclosures (Tabl
Related Party Disclosures (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of Notes Payable to Related Party | Notes payable to related party as of September 30, 2019 and December 31, 2018 is as follows: (in thousands) September 30, 2019 December 31, 2018 Notes payable to related party $ 1,154 $ 1,294 Less: Current portion (187) (187) Notes payable to related party, net of current portion $ 967 $ 1,107 |
Stock-Based Awards (Tables)
Stock-Based Awards (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Classification of Stock-Based Compensation Expense | Stock-based compensation expense was classified in the statements of operations and comprehensive loss as follows: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 Research and development expenses $ 1,992 $ 1,069 $ 5,474 $ 3,014 General and administrative expenses 2,737 1,545 9,591 3,869 Total $ 4,729 $ 2,614 $ 15,065 $ 6,883 |
Nature of the Business and Ba_2
Nature of the Business and Basis of Presentation - Additional Information (Details) $ / shares in Units, $ in Thousands | Oct. 02, 2017 | Jun. 30, 2018USD ($)$ / sharesshares | Oct. 31, 2017USD ($)$ / sharesshares | Sep. 30, 2019USD ($)$ / sharesshares | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)$ / sharesshares | Sep. 30, 2018USD ($)shares | Dec. 31, 2018USD ($) |
Nature Of Business And Basis Of Presentation [Line Items] | ||||||||
Share conversion ratio | 5.65 | |||||||
Net loss | $ (56,196) | $ (24,435) | $ (125,040) | $ (67,555) | $ (99,900) | |||
Accumulated deficit | $ 420,763 | $ 420,763 | $ 295,723 | |||||
Common Stock | ||||||||
Nature Of Business And Basis Of Presentation [Line Items] | ||||||||
Number of shares issued and sold (in shares) | shares | 12,432,431 | 12,432,431 | 4,945,000 | |||||
IPO | ||||||||
Nature Of Business And Basis Of Presentation [Line Items] | ||||||||
Number of shares issued and sold (in shares) | shares | 8,166,496 | |||||||
Additional offering price of common stock (in dollars per share) | $ / shares | $ 17 | |||||||
Net proceeds from initial public offering | $ 124,600 | |||||||
IPO | Common Stock | Follow on Offering | ||||||||
Nature Of Business And Basis Of Presentation [Line Items] | ||||||||
Number of shares issued and sold (in shares) | shares | 4,945,000 | 12,432,431 | ||||||
Additional offering price of common stock (in dollars per share) | $ / shares | $ 40 | $ 37 | $ 37 | |||||
Net proceeds from initial public offering | $ 185,300 | $ 431,800 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Summary of Potential Dilutive Securities (Details) - shares | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potential dilutive securities excluded from computation of diluted net loss per common share (in shares) | 6,958,125 | 5,830,507 |
Unvested restricted common stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potential dilutive securities excluded from computation of diluted net loss per common share (in shares) | 67,000 | 20,000 |
Options to purchase common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potential dilutive securities excluded from computation of diluted net loss per common share (in shares) | 6,891,125 | 5,810,507 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Jan. 01, 2019 | Dec. 31, 2018 | |
Significant Accounting Policies [Line Items] | ||||
Amounts capitalized under build-to-suit lease transactions | $ 0 | $ 11,574 | ||
Right of use assets | 522 | $ 0 | ||
Operating lease liability | 522 | 11,900 | ||
Construction in Progress | ||||
Significant Accounting Policies [Line Items] | ||||
Company capitalized construction-in-progress lease financing obligation | 11,900 | |||
Accounting Standards Update 2016-02 | ||||
Significant Accounting Policies [Line Items] | ||||
Right of use assets | $ 800 | |||
Operating lease liability | $ 800 | |||
CRL Construction Loan | ||||
Significant Accounting Policies [Line Items] | ||||
Fair value of outstanding notes payable to related party | $ 1,000 | $ 1,100 | ||
Capital Lease Obligations | ||||
Significant Accounting Policies [Line Items] | ||||
Amounts capitalized under build-to-suit lease transactions | 11,600 | |||
Capital Lease Obligations | Capital Lease Obligations | ||||
Significant Accounting Policies [Line Items] | ||||
Amounts capitalized under build-to-suit lease transactions | $ 17,900 |
License Agreement - Additional
License Agreement - Additional Information (Details) - Zai License Agreement - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2019 | |
Upfront cash payment receivable | $ 20 | $ 20 | |
Agreement continuation period; (iii) Period after the date of the first commercial sale of such Licensed Product | 10 years | ||
Upfront payment recognized revenue | $ 20 | ||
License | |||
Revenues | 25 | ||
Development And Commercial Milestone | Maximum | |||
License agreement milestone | $ 185 | ||
Development Milestone | INTRIGUE Study Related Milestone | |||
License agreement milestone | $ 5 | ||
Development Milestone | Maximum | |||
License agreement milestone | 50 | ||
Commercial Milestone | Maximum | |||
License agreement milestone | $ 135 | ||
Development And Regulatory Milestone | |||
License agreement milestone revenue recognized | $ 5 |
Marketable Securities and Fai_3
Marketable Securities and Fair Value Measurements - Schedule of Marketable Securities (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Marketable Securities [Line Items] | ||
Amortized Cost | $ 460,822,000 | |
Gross Unrealized Gains | 150,000 | |
Gross Unrealized Losses | (89,000) | |
Estimated Fair Value | 460,883,000 | $ 0 |
Commercial paper | ||
Marketable Securities [Line Items] | ||
Amortized Cost | 274,354,000 | |
Gross Unrealized Gains | 89,000 | |
Gross Unrealized Losses | (42,000) | |
Estimated Fair Value | 274,401,000 | |
U.S. Government securities | ||
Marketable Securities [Line Items] | ||
Amortized Cost | 142,243,000 | |
Gross Unrealized Gains | 43,000 | |
Gross Unrealized Losses | (41,000) | |
Estimated Fair Value | 142,245,000 | |
Certificates of deposit | ||
Marketable Securities [Line Items] | ||
Amortized Cost | 44,225,000 | |
Gross Unrealized Gains | 18,000 | |
Gross Unrealized Losses | (6,000) | |
Estimated Fair Value | $ 44,237,000 |
Marketable Securities and Fai_4
Marketable Securities and Fair Value Measurements - Schedule of Financial Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Cash equivalents: | ||
Total Cash equivalents | $ 267,145,000 | |
Marketable securities: | ||
Total Marketable securities | $ 460,883,000 | 0 |
Total | 579,944,000 | |
U.S. Government securities | ||
Marketable securities: | ||
Total Marketable securities | 142,245,000 | |
Commercial paper | ||
Cash equivalents: | ||
Total Cash equivalents | 80,246,000 | |
Marketable securities: | ||
Total Marketable securities | 274,401,000 | |
Money market funds | ||
Cash equivalents: | ||
Total Cash equivalents | 25,716,000 | 267,145,000 |
Certificates of deposit | ||
Cash equivalents: | ||
Total Cash equivalents | 13,099,000 | |
Marketable securities: | ||
Total Marketable securities | 44,237,000 | |
Level 1 | ||
Cash equivalents: | ||
Total Cash equivalents | 0 | |
Marketable securities: | ||
Total | 0 | |
Level 1 | U.S. Government securities | ||
Marketable securities: | ||
Total Marketable securities | 0 | |
Level 1 | Commercial paper | ||
Cash equivalents: | ||
Total Cash equivalents | 0 | |
Marketable securities: | ||
Total Marketable securities | 0 | |
Level 1 | Money market funds | ||
Cash equivalents: | ||
Total Cash equivalents | 0 | 0 |
Level 1 | Certificates of deposit | ||
Cash equivalents: | ||
Total Cash equivalents | 0 | |
Marketable securities: | ||
Total Marketable securities | 0 | |
Level 2 | ||
Cash equivalents: | ||
Total Cash equivalents | 267,145,000 | |
Marketable securities: | ||
Total | 579,944,000 | |
Level 2 | U.S. Government securities | ||
Marketable securities: | ||
Total Marketable securities | 142,245,000 | |
Level 2 | Commercial paper | ||
Cash equivalents: | ||
Total Cash equivalents | 80,246,000 | |
Marketable securities: | ||
Total Marketable securities | 274,401,000 | |
Level 2 | Money market funds | ||
Cash equivalents: | ||
Total Cash equivalents | 25,716,000 | 267,145,000 |
Level 2 | Certificates of deposit | ||
Cash equivalents: | ||
Total Cash equivalents | 13,099,000 | |
Marketable securities: | ||
Total Marketable securities | 44,237,000 | |
Level 3 | ||
Cash equivalents: | ||
Total Cash equivalents | 0 | |
Marketable securities: | ||
Total | 0 | |
Level 3 | U.S. Government securities | ||
Marketable securities: | ||
Total Marketable securities | 0 | |
Level 3 | Commercial paper | ||
Cash equivalents: | ||
Total Cash equivalents | 0 | |
Marketable securities: | ||
Total Marketable securities | 0 | |
Level 3 | Money market funds | ||
Cash equivalents: | ||
Total Cash equivalents | 0 | $ 0 |
Level 3 | Certificates of deposit | ||
Cash equivalents: | ||
Total Cash equivalents | 0 | |
Marketable securities: | ||
Total Marketable securities | $ 0 |
Marketable Securities and Fai_5
Marketable Securities and Fair Value Measurements - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Total Marketable securities | $ 460,883,000 | $ 460,883,000 | $ 0 | ||
Transfers between Level 1, Level 2 and Level 3 | 0 | $ 0 | 0 | $ 0 | |
Certificates of deposit | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Total Marketable securities | 44,237,000 | 44,237,000 | |||
Certificates of deposit | Letter of Credit | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Cash balance held to secure letter of credit associated with lease and credit card | $ 1,500,000 | $ 1,500,000 | $ 1,100,000 |
Leases - Operating Leases in th
Leases - Operating Leases in the Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Leases [Abstract] | ||
Operating lease assets | $ 522 | $ 0 |
Current operating lease liabilities | 415 | 539 |
Operating lease liabilities, net of current portion | 107 | 11,347 |
Total operating lease liabilities | $ 522 | $ 11,900 |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($) | |
Leases [Abstract] | ||
Operating lease cost | $ 104 | $ 462 |
Short-term lease cost | 82 | 270 |
Variable lease cost | 128 | 337 |
Total lease cost | $ 314 | $ 1,069 |
Weighted-average remaining lease term in years | 1 year 2 months 1 day | 1 year 2 months 1 day |
Weighted-average discount rate | 5.37% | 5.37% |
Leases - Summary of Future Mini
Leases - Summary of Future Minimum Lease Payments under Operating Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Operating Leases, After Adoption | ||
Remainder of 2019 (three months) | $ 108 | |
2020 | 433 | |
Total future minimum lease payments | 541 | |
Less: imputed interest | (19) | |
Total operating lease liabilities | $ 522 | $ 11,900 |
Operating Leases, Before Adoption | ||
2019 | 726 | |
2020 | 333 | |
Total | $ 1,059 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of operating lease liabilities | $ 104 | $ 424 |
Operating lease liabilities arising from obtaining operating lease assets | $ 142 | $ 142 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments Commitments Lease (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Leases [Abstract] | |
2019 | $ 170 |
2020 | 2,043 |
2021 | 2,088 |
2022 | 2,132 |
2023 | 2,177 |
Thereafter | 13,783 |
Total | $ 22,393 |
Leases - Additional Information
Leases - Additional Information (Details) $ in Thousands | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||
Apr. 30, 2019USD ($)ft² | Aug. 30, 2018 | May 31, 2018USD ($) | Sep. 30, 2019USD ($)renewal_optioncontract | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | |
Lessee, Lease, Description [Line Items] | ||||||
Amounts capitalized under build-to-suit lease transactions | $ 0 | $ 11,574 | ||||
Certificates of deposit | Letter of Credit | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Cash balance held to secure letter of credit associated with lease and credit card | $ 1,500 | $ 1,100 | ||||
Lease Agreement for Office and Laboratory Space in Lawrence, Kansas | Kansas | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Number of lease agreement | contract | 2 | |||||
Lease term | 5 years | |||||
Lease for Additional Office Space in Lawrence, Kansas | Kansas | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Number of lease agreement | contract | 3 | |||||
Sublease for Additional Agreement for Office Space in Waltham, Massachussetts | Massachusetts | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Sublease term | 9 months | |||||
Sublease Agreement for Office Space in Waltham, Massachusetts | Massachusetts | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Sublease term | 3 years | |||||
Office Space in Waltham | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Initial annual base rent expense | $ 2,000 | |||||
Minimum rental expense | $ 22,400 | |||||
Amounts capitalized under build-to-suit lease transactions | $ 11,900 | |||||
Office Space in Waltham | Certificates of deposit | Letter of Credit | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Cash balance held to secure letter of credit associated with lease and credit card | $ 1,100 | |||||
Office Space in Waltham | Massachusetts | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Number of options to extend | renewal_option | 2 | |||||
Options to extend terms of the lease | 5 years | |||||
Office Space In Waltham Amended | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Initial annual base rent expense | $ 1,900 | |||||
Minimum rental expense | $ 18,200 | |||||
Additional area of lease space | ft² | 38,003 | |||||
Total lease area | ft² | 82,346 | |||||
Office Space In Waltham Amended | Certificates of deposit | Additional Amount | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Cash balance held to secure letter of credit associated with lease and credit card | $ 900 | |||||
Office Space In Waltham Amended | Massachusetts | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Number of options to extend | renewal_option | 2 | |||||
Options to extend terms of the lease | 5 years |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
External research and development expenses | $ 15,377 | $ 8,761 |
Payroll and related expenses | 7,664 | 4,139 |
Professional fees | 2,421 | 747 |
Other | 1,422 | 62 |
Total accrued expenses and other current liabilities | $ 26,884 | $ 13,709 |
Related Party Transactions - No
Related Party Transactions - Notes Payable to Related Party (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||
Less: current portion | $ (187) | $ (187) |
Notes payable to related party, net of current portion | 967 | 1,107 |
CRL Construction Loan | Clinical Reference Laboratory, Inc. | ||
Related Party Transaction [Line Items] | ||
Notes payable to related party | 1,154 | 1,294 |
Less: current portion | (187) | (187) |
Notes payable to related party, net of current portion | $ 967 | $ 1,107 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | ||||||
Research and development expense | $ 40,374 | $ 20,630 | $ 110,974 | $ 55,531 | ||
Clinical Reference Laboratory, Inc. | ||||||
Related Party Transaction [Line Items] | ||||||
Amounts owed for laboratory services | 100 | 100 | $ 200 | |||
Clinical Reference Laboratory, Inc. | Service Agreement | ||||||
Related Party Transaction [Line Items] | ||||||
Research and development expense | 200 | 200 | 500 | 700 | ||
Payments for research and development expense | 300 | 100 | 600 | 500 | ||
Clinical Reference Laboratory, Inc. | CHC, Inc. | Loan and Security Agreement | ||||||
Related Party Transaction [Line Items] | ||||||
Aggregate borrowings | $ 2,800 | $ 2,800 | ||||
Ownership percentage | 100.00% | |||||
Fixed interest rate | 6.00% | 6.00% | ||||
Debt instrument term | 15 years | |||||
Interest expense on borrowings | $ 100 | 100 | ||||
Debt instrument principal and interest payment | 200 | $ 200 | ||||
Principal amount owed under loan agreement | $ 1,200 | $ 1,200 | $ 1,300 | |||
Clinical Reference Laboratory, Inc. | Maximum | CHC, Inc. | Loan and Security Agreement | ||||||
Related Party Transaction [Line Items] | ||||||
Interest expense on borrowings | 100 | 100 | ||||
Debt instrument principal and interest payment | $ 100 | $ 100 | ||||
Clinical Reference Laboratory, Inc. | Brightstar | Minimum | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of common stock holding | 5.00% |
Stock-Based Awards - Classifica
Stock-Based Awards - Classification of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 4,729 | $ 2,614 | $ 15,065 | $ 6,883 |
Research and development expenses | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 1,992 | 1,069 | 5,474 | 3,014 |
General and administrative expenses | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 2,737 | $ 1,545 | $ 9,591 | $ 3,869 |
Stock-Based Awards - Additional
Stock-Based Awards - Additional Information (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2019USD ($)shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost related to unvested share-based awards | $ | $ 52.4 |
Unrecognized compensation cost related to unvested share-based awards, period for recognition | 2 years 9 months 18 days |
President And Chief Executive Officer | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock-based compensation expense related to modification | $ | $ 2.4 |
2017 Stock Option and Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock available for issuance (in shares) | shares | 1,517,723 |
Employee Stock Purchase Plan (ESPP) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock available for issuance (in shares) | shares | 1,009,433 |
Savings Plan 401(k) - Additiona
Savings Plan 401(k) - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Defined Contribution Plan Disclosure [Line Items] | ||||
Defined contribution plan description | Effective January 1, 2018, the Company adopted the Deciphera Pharmaceuticals 401(k) Plan (the 401(k) Plan), a defined contribution plan under Section 401(k) of the Internal Revenue Code, whereby the Company provides matching contributions of 100% of each employee’s contribution up to a maximum matching contribution of 3% of the employee’s eligible compensation and at a rate of 50% of each employee’s contribution in excess of 3% up to a maximum of 5% of the employee’s eligible compensation | |||
Matching contributions to the plan by employer | $ 0.2 | $ 0.1 | $ 0.7 | $ 0.3 |
Up to 3 Percent of Compensation | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Percentage of matching contribution to plan | 100.00% | |||
First Tier of Matching | Maximum | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Employee earnings subject to employer match | 3.00% | |||
3 to 5 Percent of Compensation | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Percentage of matching contribution to plan | 50.00% | |||
Second Tier of Matching | Maximum | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Percentage of salary for matching contribution per employee on time-based vesting | 5.00% | |||
Second Tier of Matching | Minimum | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Percentage of salary for matching contribution per employee on time-based vesting | 3.00% |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - KBA Grants $ in Millions | Dec. 31, 2013USD ($)award |
Other Commitments [Line Items] | |
Number of awards grants | award | 2 |
Amount of grants awarded | $ | $ 2 |