Verona Pharma (VRNA) 10-Q 3 Aug 23 2023 Q2 Quarterly report Financial data

Cover

Cover - shares	6 Months Ended
	Jun. 30, 2023	Jul. 27, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Document Transition Report	false
Entity File Number	001-38067
Entity Registrant Name	Verona Pharma plc
Entity Incorporation, State or Country Code	X0
Entity Tax Identification Number	98-1489389
Entity Address, Address Line One	3 More London Riverside
Entity Address, City or Town	London
Entity Address, Postal Zip Code	SE1 2RE
Entity Address, Country	GB
Country Region	44
City Area Code	203
Local Phone Number	283 4200
Title of 12(b) Security	Ordinary shares, nominal value £0.05 per share*
Trading Symbol	VRNA
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		635,875,302
Amendment Flag	false
Document Fiscal Year Focus	2023
Current Fiscal Year End Date	--12-31
Document Fiscal Period Focus	Q2
Entity Central Index Key	0001657312

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 270,727	$ 227,827
Prepaid expenses	894	2,499
Tax incentive receivable	10,150	9,282
Other current assets	6,060	3,388
Total current assets	287,831	242,996
Non-current assets:
Furniture and equipment, net	11	73
Goodwill	545	545
Equity interest	15,000	15,000
Right-of-use assets	542	854
Total non-current assets	16,098	16,472
Total assets	303,929	259,468
Current liabilities:
Accounts payable	2,493	2,910
Accrued expenses	7,467	13,752
Current operating lease liabilities	545	675
Taxes payable	0	283
Other current liabilities	444	1,409
Total current liabilities	10,949	19,029
Non-current liabilities:
Term loan	19,857	9,768
Non-current operating lease liabilities	30	205
Total non-current liabilities	19,887	9,973
Total liabilities	30,836	29,002
Commitments and contingencies
Shareholders' equity:
Ordinary £0.05 par value shares; 651,659,630 and 631,338,246 issued, and 635,787,302 and 606,301,054 outstanding, at June 30, 2023 and December 31, 2022, respectively	41,753	40,526
Additional paid-in capital	596,059	529,187
Ordinary shares held in treasury	(975)	(1,549)
Accumulated other comprehensive loss	(4,601)	(4,601)
Accumulated deficit	(359,143)	(333,097)
Total shareholders' equity	273,093	230,466
Total liabilities and shareholders' equity	$ 303,929	$ 259,468

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - £ / shares	Jun. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Common stock, par value (in pounds sterling per share)	£ 0.05	£ 0.05
Common stock, issued (in shares)	651,659,630	631,338,246
Common stock, outstanding (in shares)	635,787,302	606,301,054

Consolidated Statements of Oper

Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Operating expenses:
Research and development (Note 8)	$ (2,474)	$ 14,982	$ 10,136	$ 32,607
Selling, general and administrative	12,439	5,526	22,028	12,966
Total operating expenses	9,965	20,508	32,164	45,573
Operating loss	(9,965)	(20,508)	(32,164)	(45,573)
Other income/(expense):
Research and development tax credit	(1,934)	5,409	379	6,711
Interest income	3,402	165	6,079	180
Interest expense	(740)	(91)	(1,033)	(175)
Foreign exchange gain/(loss)	740	(2,662)	1,672	(3,585)
Total other income, net	1,468	2,821	7,097	3,131
Loss before income taxes	(8,497)	(17,687)	(25,067)	(42,442)
Income tax expense	(310)	(79)	(483)	(161)
Net loss	$ (8,807)	$ (17,766)	$ (25,550)	$ (42,603)
Profit/(loss) per share, basic (in dollars per share)	$ (0.01)	$ (0.04)	$ (0.04)	$ (0.09)
Profit/(loss) per share, diluted (in dollars per share)	$ (0.01)	$ (0.04)	$ (0.04)	$ (0.09)
Weighted-average shares outstanding, basic (in shares)	634,469,423	484,777,837	627,996,124	483,226,039
Weighted-average shares outstanding, diluted (in shares)	634,469,423	484,777,837	627,996,124	483,226,039

Consolidated Statements of Shar

Consolidated Statements of Shareholders’ Equity - USD ($) $ in Thousands	Total	At-The-Market Sales Agreement	Ordinary shares	Ordinary shares At-The-Market Sales Agreement	Additional paid-in capital	Additional paid-in capital At-The-Market Sales Agreement	Ordinary shares held in treasury	Accumulated other comprehensive loss	Accumulated deficit
Beginning balance (in shares) at Dec. 31, 2021			489,177,550
Beginning balance at Dec. 31, 2021	$ 148,005		$ 31,855		$ 385,070		$ (603)	$ (4,601)	$ (263,716)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(24,837)								(24,837)
Issuance of common shares (in shares)				80,696
Issuance of common shares		$ 67		$ 5		$ 62
Restricted share units vested							186		(186)
Issuance of ordinary shares to treasury (in shares)			4,800,000
Issuance of ordinary shares to treasury	0		$ 322				(322)
Common shares withheld for taxes on vested stock awards	(793)				(793)
Equity settled share-based compensation reclassified as cash-settled	118				118
Share-based compensation	3,747				3,747
Ending balance (in shares) at Mar. 31, 2022			494,058,246
Ending balance at Mar. 31, 2022	126,307		$ 32,182		388,204		(739)	(4,601)	(288,739)
Beginning balance (in shares) at Dec. 31, 2021			489,177,550
Beginning balance at Dec. 31, 2021	148,005		$ 31,855		385,070		(603)	(4,601)	(263,716)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(42,603)
Ending balance (in shares) at Jun. 30, 2022			494,058,246
Ending balance at Jun. 30, 2022	110,880		$ 32,182		390,543		(591)	(4,601)	(306,653)
Beginning balance (in shares) at Mar. 31, 2022			494,058,246
Beginning balance at Mar. 31, 2022	126,307		$ 32,182		388,204		(739)	(4,601)	(288,739)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(17,766)								(17,766)
Restricted share units vested							148		(148)
Common shares withheld for taxes on vested stock awards	(689)				(689)
Equity settled share-based compensation reclassified as cash-settled	(25)				(25)
Share-based compensation	3,053				3,053
Ending balance (in shares) at Jun. 30, 2022			494,058,246
Ending balance at Jun. 30, 2022	$ 110,880		$ 32,182		390,543		(591)	(4,601)	(306,653)
Beginning balance (in shares) at Dec. 31, 2022	606,301,054		631,338,246
Beginning balance at Dec. 31, 2022	$ 230,466		$ 40,526		529,187		(1,549)	(4,601)	(333,097)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(16,743)								(16,743)
Issuance of common shares (in shares)			20,321,384
Issuance of common shares	56,909		$ 1,227		55,682
Restricted share units vested							270		(270)
Share options exercised	1,827				1,756		71
Share-based compensation	4,290				4,290
Ending balance (in shares) at Mar. 31, 2023			651,659,630
Ending balance at Mar. 31, 2023	$ 276,749		$ 41,753		590,915		(1,208)	(4,601)	(350,110)
Beginning balance (in shares) at Dec. 31, 2022	606,301,054		631,338,246
Beginning balance at Dec. 31, 2022	$ 230,466		$ 40,526		529,187		(1,549)	(4,601)	(333,097)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	$ (25,550)
Ending balance (in shares) at Jun. 30, 2023	635,787,302		651,659,630
Ending balance at Jun. 30, 2023	$ 273,093		$ 41,753		596,059		(975)	(4,601)	(359,143)
Beginning balance (in shares) at Mar. 31, 2023			651,659,630
Beginning balance at Mar. 31, 2023	276,749		$ 41,753		590,915		(1,208)	(4,601)	(350,110)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(8,807)								(8,807)
Restricted share units vested							226		(226)
Share options exercised	77				70		7
Share-based compensation	$ 5,074				5,074
Ending balance (in shares) at Jun. 30, 2023	635,787,302		651,659,630
Ending balance at Jun. 30, 2023	$ 273,093		$ 41,753		$ 596,059		$ (975)	$ (4,601)	$ (359,143)

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash flows from operating activities:
Net loss	$ (25,550)	$ (42,603)
Adjustments to reconcile net income to net cash used in operating activities:
Foreign exchange (gain)/loss	(1,672)	3,256
Other non-cash items	88	44
Accretion of redemption premium on debt	51	63
Share-based compensation	9,364	6,801
Depreciation	314	328
Changes in operating assets and liabilities:
Prepaid expenses	1,605	(694)
Tax incentive receivable	(380)	(6,461)
Other current assets	(2,016)	(143)
Accounts payable	(417)	(680)
Accrued expenses	(6,285)	6,347
Lease liabilities	(305)	(338)
Income taxes	(939)	164
Other current liabilities	(951)	(113)
Net cash used in operating activities	(27,093)	(34,029)
Cash flows from investing activities:
Purchases of furniture and equipment	0	29
Net cash used in investing activities	0	(29)
Cash flows from financing activities:
Proceeds from issuance of stock	56,909	67
Proceeds from draw under the Oxford Term Loan	9,996	0
Payments of withholding taxes from share-based awards	0	(1,482)
Proceeds from exercise of share options	1,904	0
Net cash provided by/(used in) financing activities	68,809	(1,415)
Effect of exchange rate changes on cash and cash equivalents	1,184	(1,397)
Net change in cash and cash equivalents	42,900	(36,870)
Cash and cash equivalents at beginning of the period	227,827	148,380
Cash and cash equivalents at end of the period	270,727	111,510
Supplemental Cash Flow Information [Abstract]
Income taxes paid	1,215	1
Interest paid	$ 685	$ 115

Organization and description of

Organization and description of business operations	6 Months Ended
	Jun. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and description of business operations	Organization and description of business operations Verona Pharma plc (the “Company”) is incorporated and domiciled in the United Kingdom. Verona Pharma plc has one wholly-owned subsidiary, Verona Pharma, Inc., a Delaware corporation. The address of the registered office is 1 Central Square, Cardiff, CF10 1FS, United Kingdom. The Company is a clinical-stage biopharmaceutical group focused on developing and commercializing innovative therapeutics for the treatment of respiratory diseases with significant unmet medical needs. The Company’s American Depositary Shares (“ADSs”) are listed on the Nasdaq Global Market (“Nasdaq”) and trade under the symbol “VRNA”. In June 2023, the Company submitted a New Drug Application (“NDA”) to the U.S. Food and Drug Administration for approval of ensifentrine for the maintenance treatment of patients with chronic obstructive pulmonary disease (“COPD”) and is preparing for a potential commercial launch in 2024, subject to approval of the NDA. In conjunction with the submission, the Company paid a $3.2 million Prescription Drug User Fee Act (“PDUFA”) application fee to the FDA. The Company has requested a small business waiver of this application fee and, as such, the amount has been recorded within Other current assets in the Condensed Consolidated Balance Sheets. Liquidity The Company has incurred recurring losses and negative cash flows from operations since inception, and has an accumulated deficit of $359.1 million as of June 30, 2023. The Company expects to incur additional losses and negative cash flows from operations until its products potentially gain regulatory approval and reach commercial profitability, if at all. The Company expects that its cash and cash equivalents as of June 30, 2023, will be sufficient to fund its operating expenses and capital expenditure requirements for at least the next 12 months from the date of issuance. During the six months ended June 30, 2023, the Company sold 20,321,384 ordinary shares (equivalent to 2,540,173 ADSs) under the at-the-market offering program entered into in March 2021 (the “2021 ATM Program”). The shares sold were at an average price of approximately $2.88 per share (equivalent to $23.08 per ADS), raising aggregate net proceeds of approximately $56.9 million after deducting issuance costs. In March 2023, through a registration statement on Form S-3, the Company replaced the 2021 ATM Program, with an open market sale agreement with Jefferies LLC (“Jefferies”) to sell its ordinary shares, in the form of ADSs, with aggregate gross proceeds of up to $200.0 million, from time-to-time, through an “at the market” equity offering program under which Jefferies will act as sales agent (the “2023 ATM Program”). Jefferies is entitled to a commission at a rate of up to 3.0% of the gross proceeds. The Company’s commercial revenue, if any, will be derived from sales of products that we do not expect to be commercially available within the next year, if ever. Additionally, the Company may enter into out-licensing transactions from time to time but there can be no assurance that the Company can secure such transactions in the future. Accordingly, the Company may need to obtain substantial additional funds to achieve its business objectives including to further advance clinical and regulatory activities, to fund prelaunch and launch related costs and to create an effective sales and marketing organization to commercialize ensifentrine, if approved. Any such funding will need to be obtained through public or private financings, debt financing, collaboration or licensing arrangements or other arrangements. However, there is no guarantee the Company will be successful in securing additional capital on acceptable terms, or at all.

Basis of presentation and summa

Basis of presentation and summary of significant accounting policies	6 Months Ended
	Jun. 30, 2023
Accounting Policies [Abstract]
Basis of presentation and summary of significant accounting policies	Basis of presentation and summary of significant accounting policies Basis of presentation and consolidation The unaudited condensed consolidated financial statements include the accounts of Verona Pharma plc and its wholly-owned subsidiary Verona Pharma, Inc. All inter-company balances and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”) and should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K filed on March 7, 2023 (the “2022 Form 10-K”). The Consolidated Balance Sheet as of December 31, 2022, was derived from audited consolidated financial statements included in the 2022 Form 10-K but does not include all disclosures required by U.S. GAAP for complete financial statements. The Company’s significant accounting policies are described in Note 2 to those consolidated financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted from these interim financial statements. The unaudited condensed consolidated financial statements reflect all adjustments which in the opinion of management are necessary for a fair statement of results of operations, comprehensive income, financial condition, cash flows and shareholders' equity for the periods presented. Except as otherwise disclosed, all such adjustments are of a normal recurring nature. Operating results for the interim periods are not necessarily indicative of the results that may be expected for the full year. Segment reporting Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company has one operating and reportable segment, pharmaceutical development. Use of estimates The preparation of interim unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting periods. Significant estimates and assumptions reflected in these unaudited condensed consolidated financial statements include, but are not limited to, the accrual and prepayment of research and development expenses and the fair value of share-based compensation. 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, and actual results could differ from the Company’s estimates. Recently adopted accounting standards and recent accounting standards not yet adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326)-Measurement of Credit Losses on Financial Instruments. This guidance replaces the current incurred loss impairment methodology. Under this model, on initial recognition and at each reporting period, an entity is required to recognize an allowance that reflects its current estimate of credit losses expected to be incurred over the life of the financial instrument based on historical experience, current conditions and reasonable and supportable forecasts. The guidance requires a modified retrospective transition approach through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. This update became effective for the Company on January 1, 2023 and the adoption of this update did not have a material impact on the Company’s financial statements and related disclosures.

Equity Interest

Equity Interest	6 Months Ended
	Jun. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Equity interest	Equity interest The Company entered into a collaboration and license agreement (the “Nuance Agreement”) with Nuance Pharma Limited (“Nuance Pharma”) effective June 9, 2021 (the “Effective Date”), under which the Company granted Nuance Pharma the exclusive rights to develop and commercialize ensifentrine in Greater China (China, Taiwan, Hong Kong and Macau). In return, the Company received an unconditional right to consideration aggregating $40.0 million consisting of $25.0 million in cash and an equity interest, valued at $15.0 million as of the Effective Date, in Nuance Biotech, the parent company of Nuance Pharma. The equity interest is recorded at cost as the Company has elected to use the measurement alternative for equity investments without readily determinable fair values. The Company evaluates this investment for indicators of impairment quarterly. The Company did not identify events or changes in circumstances that may have a significant effect on the fair value of the investment during the six months ended June 30, 2023.

Accrued expenses

Accrued expenses	6 Months Ended
	Jun. 30, 2023
Payables and Accruals [Abstract]
Accrued expenses	Accrued expenses Accrued expenses consisted of the following (in thousands): June 30, December 31, 2023 2022 Clinical trial and other development costs $ 3,609 $ 12,314 Professional fees and general corporate costs 1,377 1,364 People related costs 2,481 74 Total accrued expenses $ 7,467 $ 13,752

Term loan

Term loan	6 Months Ended
	Jun. 30, 2023
Debt Disclosure [Abstract]
Term loan	Term loan On October 14, 2022 (the “Effective Date”), the Company entered into a loan and security agreement (the “Loan Agreement”) with Oxford Finance Luxembourg S.À R.L. (“Oxford”) for an aggregate amount of up to $150.0 million (the “Oxford Term Loan”). The Oxford Term Loan provides for an initial term loan advance in an aggregate amount of $10.0 million, which was funded on the Effective Date (the “Oxford Term A Loan”), and up to four additional term loan advances in an aggregate amount of $140.0 million. The Oxford Term Loan has a maturity date of October 1, 2027. On March 24, 2023, the Company received $10.0 million under the second term loan advance (the “Oxford Term B Loan”). The Oxford Term A Loan and Oxford Term B Loan (together, the “Oxford Term Loan Advances”) bear interest at a variable rate equal to (a) the greater of (i) the 1-Month CME Term SOFR reference rate on the last day of the month that immediately precedes the month in which the interest will accrue and (ii) 2.38%, plus (b) 5.50% (the “Basic Rate”) and shall not increase by more than 2.00% above the Basic Rate as of the funding date of each such term loan. For the six months ended June 30, 2023, the effective interest rate was approximately 11% per annum. There was no material difference between the carrying value and the estimated fair value of the Oxford Term Loan Advances outstanding.

Share based compensation

Share based compensation	6 Months Ended
	Jun. 30, 2023
Share-Based Payment Arrangement [Abstract]
Share based compensation	Share-based compensation The following table shows the allocation of share-based compensation between research and development and selling, general and administrative costs (in thousands): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Research and development $ 1,123 $ 1,330 $ 2,226 $ 2,869 Selling, general and administrative 3,951 1,723 7,138 3,932 Total $ 5,074 $ 3,053 $ 9,364 $ 6,801 Share options The following table shows share option activity, in ordinary shares, in the period: Number of share options outstanding Balance as of December 31, 2022 19,276,496 Granted 1,320,000 Forfeited (240,000) Exercised (1,050,192) Balance as of March 31, 2023 19,306,304 Granted 2,824,000 Expired (80,000) Exercised (120,000) Balance as of June 30, 2023 21,930,304 Restricted stock units activity The following table shows restricted stock unit (“RSU”) activity, in ordinary shares, in the period: Number of RSUs outstanding Balance as of December 31, 2022 34,542,344 Vested (4,305,120) Balance as of March 31, 2023 30,237,224 Vested (3,680,224) Balance as of June 30, 2023 26,557,000

Capitalization and net loss per

Capitalization and net loss per share	6 Months Ended
	Jun. 30, 2023
Earnings Per Share [Abstract]
Capitalization and net loss per share	et loss per share Net loss per share is calculated on an ordinary share basis. The Company’s ADSs that are listed on Nasdaq each represent eight ordinary shares. The following table shows the computation of basic and diluted net loss per share for the three and six months ended June 30, 2023 and 2022 (in thousands except per share amounts): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Numerator: Net loss $ (8,807) $ (17,766) $ (25,550) $ (42,603) Denominator: Weighted-average shares outstanding - basic and diluted 634,469 484,778 627,996 483,226 Net loss per share - basic and diluted $ (0.01) $ (0.04) $ (0.04) $ (0.09) During the three and six months ended June 30, 2023 and 2022, outstanding share options, RSUs and warrants over 48.5 million and 46.2 million ordinary shares, respectively, were not included in the computation of diluted earnings per ordinary share, because to do so would be antidilutive.

Commitment and contingencies

Commitment and contingencies	6 Months Ended
	Jun. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and contingencies	Commitments and contingenciesThe Company had previously accrued up to the maximum exposure of $6.9 million related to a matter with a supplier and also had certain invoices in the amount of $1.5 million in accounts payable to the same supplier. Both items were settled for $2.1 million in the three months ended June 30, 2023 resulting in a reversal of $6.3 million in Research and development costs in the Condensed Consolidated Statement of Operations and Comprehensive Loss.

Basis of presentation and sum_2

Basis of presentation and summary of significant accounting policies (Policies)	6 Months Ended
	Jun. 30, 2023
Accounting Policies [Abstract]
Basis of presentation and consolidation	Basis of presentation and consolidation The unaudited condensed consolidated financial statements include the accounts of Verona Pharma plc and its wholly-owned subsidiary Verona Pharma, Inc. All inter-company balances and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”) and should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K filed on March 7, 2023 (the “2022 Form 10-K”). The Consolidated Balance Sheet as of December 31, 2022, was derived from audited consolidated financial statements included in the 2022 Form 10-K but does not include all disclosures required by U.S. GAAP for complete financial statements. The Company’s significant accounting policies are described in Note 2 to those consolidated financial statements.
Segment Reporting	Segment reporting Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company has one operating and reportable segment, pharmaceutical development.
Use of estimates	Use of estimates The preparation of interim unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting periods. Significant estimates and assumptions reflected in these unaudited condensed consolidated financial statements include, but are not limited to, the accrual and prepayment of research and development expenses and the fair value of share-based compensation. 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, and actual results could differ from the Company’s estimates.
Recently adopted accounting standards and recent accounting standards not yet adopted	Recently adopted accounting standards and recent accounting standards not yet adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326)-Measurement of Credit Losses on Financial Instruments. This guidance replaces the current incurred loss impairment methodology. Under this model, on initial recognition and at each reporting period, an entity is required to recognize an allowance that reflects its current estimate of credit losses expected to be incurred over the life of the financial instrument based on historical experience, current conditions and reasonable and supportable forecasts. The guidance requires a modified retrospective transition approach through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. This update became effective for the Company on January 1, 2023 and the adoption of this update did not have a material impact on the Company’s financial statements and related disclosures.

Accrued expenses (Tables)

Accrued expenses (Tables)	6 Months Ended
	Jun. 30, 2023
Payables and Accruals [Abstract]
Schedule of Accrued Expenses	Accrued expenses consisted of the following (in thousands): June 30, December 31, 2023 2022 Clinical trial and other development costs $ 3,609 $ 12,314 Professional fees and general corporate costs 1,377 1,364 People related costs 2,481 74 Total accrued expenses $ 7,467 $ 13,752

Share based compensation (Table

Share based compensation (Tables)	6 Months Ended
	Jun. 30, 2023
Share-Based Payment Arrangement [Abstract]
Allocation of Share Based Compensation Expense	The following table shows the allocation of share-based compensation between research and development and selling, general and administrative costs (in thousands): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Research and development $ 1,123 $ 1,330 $ 2,226 $ 2,869 Selling, general and administrative 3,951 1,723 7,138 3,932 Total $ 5,074 $ 3,053 $ 9,364 $ 6,801
Share Option Activity	The following table shows share option activity, in ordinary shares, in the period: Number of share options outstanding Balance as of December 31, 2022 19,276,496 Granted 1,320,000 Forfeited (240,000) Exercised (1,050,192) Balance as of March 31, 2023 19,306,304 Granted 2,824,000 Expired (80,000) Exercised (120,000) Balance as of June 30, 2023 21,930,304
Restricted Stock Unit Activity	The following table shows restricted stock unit (“RSU”) activity, in ordinary shares, in the period: Number of RSUs outstanding Balance as of December 31, 2022 34,542,344 Vested (4,305,120) Balance as of March 31, 2023 30,237,224 Vested (3,680,224) Balance as of June 30, 2023 26,557,000

Capitalization and net loss p_2

Capitalization and net loss per share (Tables)	6 Months Ended
	Jun. 30, 2023
Earnings Per Share [Abstract]
Computation of Basic and Diluted Earning Per Share	The following table shows the computation of basic and diluted net loss per share for the three and six months ended June 30, 2023 and 2022 (in thousands except per share amounts): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Numerator: Net loss $ (8,807) $ (17,766) $ (25,550) $ (42,603) Denominator: Weighted-average shares outstanding - basic and diluted 634,469 484,778 627,996 483,226 Net loss per share - basic and diluted $ (0.01) $ (0.04) $ (0.04) $ (0.09)

Organization, Consolidation and

Organization, Consolidation and Presentation of Financial Statements (Details) $ / shares in Units, $ in Thousands	1 Months Ended	6 Months Ended
	Jun. 30, 2023 USD ($) $ / shares	Jun. 30, 2023 USD ($) subsidiary $ / shares shares	Dec. 31, 2022 USD ($)
Class of Stock [Line Items]
Number of wholly owned subsidiaries | subsidiary		1
Prescription drug user fee	$ 3,200
Accumulated deficit	$ 359,143	$ 359,143	$ 333,097
ATM Program
Class of Stock [Line Items]
Number of shares issued in sale (in shares) | shares		20,321,384
Price per share (in dollars per share) | $ / shares	$ 2.88	$ 2.88
Consideration received from sale of stock		$ 56,900
American Depository Shares
Class of Stock [Line Items]
Maximum aggregate offering price	$ 200,000	$ 200,000
Commission fee percentage	3%	3%
American Depository Shares | ATM Program
Class of Stock [Line Items]
Number of shares issued in sale (in shares) | shares		2,540,173
Price per share (in dollars per share) | $ / shares	$ 23.08	$ 23.08

Basis of presentation and sum_3

Basis of presentation and summary of significant accounting policies (Details)	6 Months Ended
	Jun. 30, 2023 segment
Accounting Policies [Abstract]
Number of operating segments	1
Number of reportable segments	1

Equity Interest (Details)

Equity Interest (Details) - Nuance (Shanghai) Pharma Co Ltd $ in Millions	Jun. 09, 2021 USD ($)
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Transaction price	$ 40
Accounts receivable	25
Equity interest receivable	$ 15

Accrued expenses (Details)

Accrued expenses (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Payables and Accruals [Abstract]
Clinical trial and other development costs	$ 3,609	$ 12,314
Professional fees and general corporate costs	1,377	1,364
People related costs	2,481	74
Total accrued expenses	$ 7,467	$ 13,752

Term loan (Details)

Term loan (Details) - Line of Credit $ in Millions	Mar. 24, 2023 USD ($)	Oct. 14, 2022 USD ($) loanAdvance	Jun. 30, 2023
Oxford Term Loan
Line of Credit Facility [Line Items]
Maximum borrowing capacity		$ 150
Number of loan advances | loanAdvance		4
Effective interest rate			11%
Oxford Term Loan | Base Rate
Line of Credit Facility [Line Items]
Debt instrument interest rate increase		2%
Oxford Term A Loan
Line of Credit Facility [Line Items]
Maximum borrowing capacity		$ 10
Oxford Term A Loan | Debt Instrument Interest Rate, Period One | Base Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate		5.50%
Oxford Term A Loan | Debt Instrument Interest Rate, Period One | Minimum | Base Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate		2.38%
Oxford Term B, C, D, E Loan
Line of Credit Facility [Line Items]
Maximum borrowing capacity		$ 140
Oxford Term B Loan
Line of Credit Facility [Line Items]
Proceeds from Lines of Credit	$ 10

Share based compensation - Shar

Share based compensation - Share-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total	$ 5,074	$ 3,053	$ 9,364	$ 6,801
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total	1,123	1,330	2,226	2,869
Selling, general and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total	$ 3,951	$ 1,723	$ 7,138	$ 3,932

Share based compensation - Sh_2

Share based compensation - Share Option Activity (Details) - shares	3 Months Ended
	Jun. 30, 2023	Mar. 31, 2023
Number of share options outstanding
Beginning balance outstanding	19,306,304	19,276,496
Granted	2,824,000	1,320,000
Expired	80,000
Forfeited		(240,000)
Exercised (in shares)	(120,000)	(1,050,192)
Ending balance outstanding	21,930,304	19,306,304

Share based compensation - RSU

Share based compensation - RSU Activity (Details) - Restricted Stock Units - shares	3 Months Ended
	Jun. 30, 2023	Mar. 31, 2023
RSU Activity
Outstanding, beginning balance	30,237,224	34,542,344
Vested	(3,680,224)	(4,305,120)
Outstanding, ending balance	26,557,000	30,237,224

Capitalization and net loss p_3

Capitalization and net loss per share - Computation (Details) $ / shares in Units, $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2023 USD ($) $ / shares shares	Mar. 31, 2023 USD ($)	Jun. 30, 2022 USD ($) $ / shares shares	Mar. 31, 2022 USD ($)	Jun. 30, 2023 USD ($) $ / shares shares	Jun. 30, 2022 USD ($) $ / shares shares
Earnings Per Share [Abstract]
Number of ordinary shares per ADS	8				8
Numerator:
Net loss | $	$ (8,807)	$ (16,743)	$ (17,766)	$ (24,837)	$ (25,550)	$ (42,603)
Denominator:
Weighted-average shares outstanding, basic (in shares)	634,469,423		484,777,837		627,996,124	483,226,039
Weighted-average shares outstanding, diluted (in shares)	634,469,423		484,777,837		627,996,124	483,226,039
Net loss per share, basic (in dollars per share) | $ / shares	$ (0.01)		$ (0.04)		$ (0.04)	$ (0.09)
Net loss per share, diluted (in dollars per share) | $ / shares	$ (0.01)		$ (0.04)		$ (0.04)	$ (0.09)
Antidilutive securities excluded from computation of loss per share (in shares)	48,500,000		46,200,000		48,500,000	46,200,000

Commitment and contingencies (D

Commitment and contingencies (Details) - USD ($) $ in Thousands	3 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Commitments and Contingencies Disclosure [Abstract]
Loss contingency accrual	$ 6,900
Accounts payable		$ 1,500
Loss in period	2,100
Research and development costs	$ 6,300