Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Feb. 29, 2024 | Jun. 30, 2023 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Fiscal Year Focus | 2023 | ||
Entity File Number | 001-38452 | ||
Entity Registrant Name | MEREO BIOPHARMA GROUP PLC | ||
Entity Incorporation, State or Country Code | X0 | ||
Entity Address, Address Line One | One Cavendish Place | ||
Entity Address, Address Line Two | 4th Floor | ||
Entity Address, City or Town | London | ||
Entity Address, Country | GB | ||
Entity Address, Postal Zip Code | W1G 0QF | ||
City Area Code | +44 | ||
Local Phone Number | 333-023-7300 | ||
Entity Tax Identification Number | 00-0000000 | ||
Title of 12(g) Security | None | ||
Trading Symbol | MREO | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Shell Company | false | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | true | ||
ICFR Auditor Attestation Flag | false | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Public Float | $ 143,781,100 | ||
Entity Common Stock, Shares Outstanding | 701,287,029 | ||
Entity Interactive Data Current | Yes | ||
Auditor Firm ID | 876 | ||
Auditor Name | PricewaterhouseCoopers LLP | ||
Auditor Location | United Kingdom | ||
Entity Central Index Key | 0001719714 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Period Focus | FY | ||
Ordinary Shares [Member] | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Ordinary Shares, nominal value of £0.003 per share | ||
Security Exchange Name | NASDAQ | ||
American Depositary Shares [Member] | |||
Document Information [Line Items] | |||
Title of 12(b) Security | American Depositary Shares, each representing five ordinary shares, nominal value of £0.003 per share | ||
Security Exchange Name | NASDAQ |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 57,421 | $ 68,182 |
Prepaid expenses and other current assets | 5,156 | 5,446 |
Research and development incentives receivables | 1,183 | 1,569 |
Total current assets | 63,760 | 75,197 |
Property and equipment, net | 405 | 551 |
Operating lease right of use assets | 1,245 | 1,665 |
Intangible assets | 1,089 | 0 |
Total assets | 66,499 | 77,413 |
Current liabilities: | ||
Accounts payable | 2,346 | 3,492 |
Accrued expenses | 5,467 | 5,436 |
Convertible loan notes - current | 0 | 13,326 |
Warrant liabilities - current | 0 | 486 |
Operating lease liabilities - current | 652 | 564 |
Other current liabilities | 1,021 | 1,071 |
Total current liabilities | 9,486 | 24,375 |
Convertible loan notes - non current | 4,394 | 0 |
Warrant liabilities - non current | 412 | 157 |
Operating lease liabilities- non current | 906 | 1,479 |
Other non-current liabilities | 764 | 0 |
Total liabilities | 15,962 | 26,011 |
Commitments and contingencies (Note 18) | ||
Shareholders' Equity | ||
Ordinary shares, par value 0.003 per share; 701,217,089 issued and outstanding shares at December 31, 2023 (2022: 624,928,519). | 2,775 | 2,478 |
Treasury shares | (1,230) | (1,335) |
Additional paid-in capital | 486,107 | 476,521 |
Accumulated deficit | (419,630) | (404,575) |
Accumulated other comprehensive loss | (17,485) | (21,687) |
Total shareholders' equity | 50,537 | 51,402 |
Total liabilities and shareholders' equity | $ 66,499 | $ 77,413 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - £ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Ordinary stock, par value | £ 0.003 | £ 0.003 |
Ordinary stock, shares issued | 701,217,089 | 624,928,519 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Statement [Abstract] | ||
Revenue | $ 10,000 | $ 0 |
Operating expenses: | ||
Cost of Revenue | (2,574) | 1,146 |
Research and development | (17,418) | (29,465) |
General and administrative | (18,424) | (26,107) |
Loss from operations | (28,416) | (54,426) |
Other income/(expenses) | ||
Interest income | 2,131 | 840 |
Interest expense | (2,881) | (4,175) |
Changes in the fair value of financial instruments | 245 | 9,286 |
Foreign currency transaction gain/(loss) net | (2,347) | 2,723 |
Other income/(expenses), net | (10) | 1,086 |
Benefit from research and development tax credit | 1,280 | 1,728 |
Net loss before income tax | (29,998) | (42,938) |
Income tax benefit | 532 | 718 |
Net loss | $ (29,466) | $ (42,220) |
Loss per share - basic | $ (0.04) | $ (0.07) |
Loss per share - diluted | $ (0.04) | $ (0.07) |
Weighted average shares outstanding - basic | 659,453,921 | 603,196,403 |
Weighted average shares outstanding - diluted | 659,453,921 | 603,196,403 |
Other comprehensive income/(loss) - Foreign currency translation adjustments, net of tax | $ 4,202 | $ (10,660) |
Total comprehensive loss | $ (25,264) | $ (52,880) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Cash flows from operating activities | ||
Net loss | $ (29,466) | $ (42,220) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Share-based compensation | 4,924 | 4,768 |
Depreciation | 171 | 181 |
Amortization of intangible assets | 395 | 0 |
Amortization of operating lease right-of-use assets | 495 | 708 |
Change in fair value of warrants | (245) | (9,286) |
Interest income | (102) | 0 |
Interest expense | 1,942 | 4,103 |
Foreign currency transaction loss/(gain) | 2,347 | (2,723) |
Other income/expenses | 0 | (2,000) |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | 502 | 532 |
Research and development incentives receivable | 456 | (3,467) |
Accounts payable | (1,263) | 617 |
Accrued expenses and other liabilities | (710) | 844 |
Operating lease liabilities | (578) | (878) |
Net cash used in operating activities | (21,132) | (48,821) |
Cash flows from investing activities | ||
Purchase of property and equipment | 0 | (13) |
Proceeds from out-licensing | 0 | 2,000 |
Purchase of intangible assets | (419) | 0 |
Net cash (used in) provided by investing activities | (419) | 1,987 |
Cash flows from financing activities | ||
Proceeds from TAP agreement | 100 | 200 |
Proceeds from issuance of ordinary shares | 11,605 | 0 |
Transaction costs on issuance of ordinary shares | (511) | 0 |
Transaction costs on convertible loan notes | (33) | 0 |
Redemption of convertible loan notes | (3,188) | 0 |
Net cash provided by financing activities | 7,973 | 200 |
Decrease in cash and cash equivalents | (13,579) | (46,634) |
Cash and cash equivalents at January 1 | 68,182 | 127,398 |
Effect of exchange rate changes | 2,818 | (12,582) |
Cash and cash equivalents at December 31 | 57,421 | 68,182 |
Supplemental disclosure | ||
Cash paid for interest | 884 | 24 |
Cash (received)/paid for income taxes | (1,337) | 1,882 |
Cash paid for the amounts included in the measurement of operating lease liabilities | 759 | 1,153 |
Supplemental disclosure of non-cash investing and financing activities | ||
Conversion of notes into ordinary shares | $ 5,318 | $ 3,428 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Total | Ordinary Shares [Member] | Treasury Shares [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive (Loss) Income [Member] | Accumulated Deficit [Member] |
Beginning balance, shares at Dec. 31, 2021 | 584,908,239 | 1,081,255 | ||||
Beginning balance, value at Dec. 31, 2021 | $ 92,198 | $ 2,333 | $ (1,440) | $ 476,768 | $ (11,027) | $ (374,436) |
Net Income (Loss) | (42,220) | (42,220) | ||||
Foreign currency translation adjustments | (10,660) | (10,660) | ||||
Share-based compensation | 4,768 | 4,768 | ||||
Exercise of share options, shares | (78,225) | |||||
Exercise of share options, value | $ 105 | (105) | ||||
Conversion of loan notes, shares | 40,020,280 | |||||
Conversion of loan notes, value | 7,225 | $ 145 | (5,001) | 12,081 | ||
Issuance of warrants | 91 | 91 | ||||
Ending balance, shares at Dec. 31, 2022 | 624,928,519 | 1,003,030 | ||||
Ending balance, value at Dec. 31, 2022 | 51,402 | $ 2,478 | $ (1,335) | 476,521 | (21,687) | (404,575) |
Net Income (Loss) | (29,466) | (29,466) | ||||
Foreign currency translation adjustments | 4,202 | 4,202 | ||||
Share-based compensation | 4,924 | 4,924 | ||||
Exercise of share options, shares | (79,630) | |||||
Exercise of share options, value | $ 105 | (105) | ||||
Issue of deferred restricted stock unit shares, shares | 501,380 | |||||
Issue of deferred restricted stock unit shares, value | 3 | $ 3 | ||||
Conversion of loan notes, shares | 27,420,095 | |||||
Conversion of loan notes, value | 7,950 | $ 108 | (6,569) | 14,411 | ||
Issuance of ordinary shares, shares | 48,367,095 | |||||
Issuance of ordinary shares, value | 11,470 | $ 186 | 11,284 | |||
Issuance of warrants | 52 | 52 | ||||
Ending balance, shares at Dec. 31, 2023 | 701,217,089 | 923,400 | ||||
Ending balance, value at Dec. 31, 2023 | $ 50,537 | $ 2,775 | $ (1,230) | $ 486,107 | $ (17,485) | $ (419,630) |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) | $ (29,466) | $ (42,220) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | During the quarter ended December 31, 2023, no director or officer (as defined in Rule 16a-1(f) of the Exchange Act) of the Company adopted , modified or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K. |
Rule 10b5-1 Arrangement Adopted | true |
Non-Rule 10b5-1 Arrangement Adopted | true |
Rule 10b5-1 Arrangement Terminated | true |
Non-Rule 10b5-1 Arrangement Terminated | true |
Nature of Business
Nature of Business | 12 Months Ended |
Dec. 31, 2023 | |
Nature Of Business Abstract | |
Nature of Business | 1. Nature of business Mereo BioPharma Group plc (the “Company” or “Mereo”) is United Kingdom (“U.K.”) based biopharmaceutical company focused on the development of innovative therapeutics for rare diseases. The Company has developed a portfolio of late-stage clinical product candidates, and its two rare disease product candidates are setrusumab for the treatment of osteogenesis imperfecta (“OI”) and alvelestat primarily for the treatment of severe alpha-1 antitrypsin deficiency-associated lung disease (“AATD-LD”). The Company is a public limited company incorporated and domiciled in the U.K., and registered in England, with shares publicly traded on the Nasdaq Capital Market via American Depositary Shares (“ADSs”) under the ticker symbol “MREO”. The Company’s registered office is located at Fourth Floor, 1 Cavendish Place, London, W1G 0QF, United Kingdom. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis Of Presentation And Summary Of Significant Accounting Policies | 2. Basis of presentation and summary of significant accounting policies Basis of presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for annual financial reporting. The consolidated financial statements are presented in U.S. dollars (“$”), which is the reporting currency of the Company. The functional currency of the Company is pound sterling (“£”). The functional currency of consolidated subsidiaries are pound sterling and U.S. dollar. All amounts disclosed in the consolidated financial statements and notes have been rounded to the nearest thousand, unless otherwise stated. At the end of the second quarter of 2023, the Company determined that it no longer qualified as a Foreign Private Issuer under SEC rules. As a result, beginning January 1, 2024, the Company was required to report with the SEC on domestic forms and comply with domestic company rules in the United States. The transition to U.S. GAAP was made retrospectively for all periods from the Company’s inception. Going concern The Company has prepared its financial statements on the basis that it will continue as a going concern. In accordance with the Financial Accounting Standards Board (“FASB”), Accounting Standards Update (“ASU”) 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40), the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern. The Company is subject to risks common to companies in the biotechnology industry, including but not limited to, risks of delays in initiating or continuing research programs and clinical trials, risks of failure of preclinical studies and clinical trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the need to successfully commercialize and gain market acceptance of its product candidates, if approved, dependence on key personnel and collaboration partners, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations, and the ability to secure additional capital to fund operations. Product candidates currently under development will require significant additional research and development efforts, including preclinical and clinical testing and regulatory approval prior to commercialization. Even if the Company’s research and development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales. The Company has historically been loss making and anticipates that it will continue to incur losses for the foreseeable future and had an accumulated deficit of $ 419.6 million as of December 31, 2023. The Company has funded these losses through a combination of public equity, private equity and debt financings, and it expects it will continue to do so until such time as it can generate significant revenue from product sales, or other commercial revenues, if ever, or through licensing and/or collaboration agreements for its rare disease or oncology product candidates. 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. Geopolitical events, including the ongoing global conflicts and increasing economic and political uncertainty have continued in 2023. This has led to significant increases in commodity prices, energy and fuel prices, credit and capital market instability (particularly in the life sciences sector) and supply chain interruptions, all of which have contributed to increasing inflation and higher market interest rates. This may in turn adversely impact the Company’s ability to deliver its goals. As of December 31, 2023, the Company had cash and cash equivalents of $ 57.4 million. The Directors and Management have reviewed the financial projections of the Company for the 12 months subsequent to the date of filing of this Annual Report on Form 10-K including consideration of severe but plausible scenarios that may affect the Company in that period. The Company expects that its cash and cash equivalents as of December 31, 2023 will be sufficient to fund its operations and capital expenditure requirements for at least twelve months from the date of filing of this Annual Report on Form 10-K. Basis of consolidation The consolidated financial information comprises the financial statements of Mereo BioPharma Group plc and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated on consolidation. The Company has an employee benefit trust (“EBT”) to facilitate share transactions pursuant to employee share schemes. Although the trust is a separate legal entity from the Company, it is consolidated into the Company’s results in accordance with the rules in ASC Topic 810, Consolidations (“ASC 810”) on special purpose entities. The Company is deemed to control the trust principally because the trust cannot operate without the funding the Company provides. Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting periods. Significant estimates and assumptions reflected in these financial statements include, but are not limited to, revenue recognition on contracts with customers and convertible loan notes. 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. Segmental information Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker in deciding how to allocate resources and assess performance. The Company and the Company’s chief operating decision maker, the Company’s Chief Executive Officer, view the Company’s operations and manage its business as a single operating segment, which is the business of developing rare disease therapies; however, the Company operates in two geographic regions: the U.K. and the U.S. The Company’s non-current assets are primarily located in the U.K. As of December 31, 2023, $ 0.1 million (2022: $ 0.1 million) o f property and equipment are located in the U.S. Concentration of credit risk and significant counterparties The Company is dependent on a number of third parties for the delivery of its programs and, where required, pays upfront deposits and fees in advance of the delivery of services. The Company considers all of its material counterparties to be creditworthy and the credit risk for each of its major counterparties to be low, but continues to assess credit risk as part of its management of these third-party relationships. Financial instruments that subject the Company to credit risk consists primarily of cash and cash equivalents. The Company places cash and cash equivalents with established financial institutions with strong credit ratings. The Company’s maximum exposure to credit risk for the components of the balance sheet of December 31, 2023 are the carrying amounts. The Company has no significant off-balance sheet risk or concentration of credit risk, such as foreign exchange contracts, options contracts, or other foreign hedging arrangements. Revenue The Company’s ongoing major or central operations are the development of product candidates to key clinical milestones and either strategically partnering them or further developing such product candidates through regulatory approval and potentially commercialization. The Company may enter into a range of different agreements with third parties, including but not limited to: (i) licensing agreements where the global rights to a product candidate are licensed to a partner; and (ii) collaboration agreements where rights to a product candidate are licensed to a partner but the Company retains certain rights, for example to further develop or commercialize the product candidate in specified geographical territories. Under both licensing and collaboration agreements, rights to product candidates are provided to a partner typically in exchange for consideration in the form of upfront payments and/or development, regulatory, commercial or other similar milestones, and royalties on commercial sales, should regulatory approval be obtained for the product candidates. The terms of these arrangements typically include payment to the Company of one or more of the following: nonrefundable, upfront license fees; payments for research and development services; fees upon the exercise of options to obtain additional services or licenses; payments based upon the achievement of defined collaboration objectives; future regulatory and sales-based milestone payments; and royalties on net sales of future products. Where the Company has performed significant development activities for its product candidates, including the setrusumab and leflutrozole partnerships described in Note 14, receipts from agreements with third parties are considered to be proceeds derived from customers of the Company’s ongoing major or central operations and therefore the Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”). When this is not the case and the third parties are not receiving outputs from the Company's ongoing or major central operations, such as in the Navicixizumab (“Navi”) partnership described in Note 15, the third parties are not considered to be customers and the Company accounts for receipts from these agreements as other income in accordance with ASC Topic 610, Gains and Losses from the Derecognition of Non-financial Assets. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, it 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; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when, or as, the Company satisfies the performance obligations. The Company only applies the five-step model to contracts when it is probable that the entity will collect substantially all of the consideration it is entitled to in exchange for the goods or services it transfers to the customer. As part of the accounting for these arrangements, the Company must make significant judgments, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each performance obligation. Once a contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within the 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. Performance obligations are promised goods or services in a contract to transfer a distinct good or service to the customer. The promised goods or services in the Company’s contracts with customers primarily consist of license rights to the Company’s intellectual property, research and development services and options to obtain additional licenses, such as a commercialization license for a potential product candidate. Promised goods or services are considered distinct when: (i) the customer can benefit from the good or service on its own or together with other readily available resources, and (ii) the promised good or service is separately identifiable from other promises in the contract. In assessing whether promised goods or services are distinct, the Company considers factors such as the stage of development of the underlying intellectual property, the capabilities of the collaboration partner to develop the intellectual property on their own and whether the required expertise is readily available. In addition, the Company considers whether the customer can benefit from a promise for its intended purpose without the receipt of the remaining promises, whether the value of the promise is dependent on the unsatisfied promises, whether there are other vendors that could provide the remaining promises, and whether it is separately identifiable from the remaining promises. The Company estimates the transaction price based on the amount of consideration the Company expects to receive for transferring the promised goods or services in the contract. The consideration may include both fixed consideration and variable consideration. At the inception of each arrangement that includes variable consideration, the Company evaluates the amount of the potential payments and the likelihood that the payments will be received. The Company utilizes either the most likely amount method or expected value method to estimate variable consideration to include in the transaction price based on which method better predicts the amount of consideration expected to be received. 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 reevaluates 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. The initial transaction price of a contract does not include amounts associated with customer option payments. After the transaction price is determined, it is allocated to the identified performance obligations based on the estimated standalone selling price. The Company must develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract. The Company utilizes key assumptions to determine the standalone selling price, which may include other comparable transactions, pricing considered in negotiating the transaction, probabilities of technical and regulatory success and the estimated costs. Based on the current agreements in effect, there is limited judgment in determining the revenue and transaction price. Certain variable consideration is allocated specifically to one or more performance obligations in a contract when the terms of the variable consideration relate to the satisfaction of the performance obligation and the resulting amounts allocated to each performance obligation are consistent with the amounts the Company would expect to receive for each performance obligation. 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 at a point in time or over time, and if over time, the facts and circumstances of each respective contract will be used to determine the revenue recognition pattern. The Company currently does not have any revenue that is being recognized over a time period. Payments to third parties arising as a direct consequence of the revenue recognized are also recorded within cost of revenue in the Company’s consolidated statements of operations and comprehensive loss. License revenue The Company has no approved product candidates and accordingly has not generated any revenue from commercial product sales. Revenue to date has been generated principally from licensing arrangements and collaboration agreements with a small number of the Company's customers. If a license to the Company's intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenues from non-refundable, upfront fees allocated to the license at such time as the license is transferred to the licensee and the licensee is able to use, and benefit from, the license. Contingent milestone payments The Company's licensing arrangements and collaboration agreements may include development, regulatory and sales milestones. ASC 606 constrains the amount of variable consideration included in the transaction price in that either all, or a portion, of variable consideration should be included in the transaction price. The variable consideration should be included only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The Company evaluates the probability of the milestones being reached and estimates the amount to be included in the transaction price using the most likely amount method. The Company evaluates factors such as the scientific, clinical, regulatory, commercial and other risks that much be overcome to achieve the particular milestone in making this assessment. 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, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. At the end of each reporting period, the Company re-evaluates the probability of achievement of such milestones and any related constraints and, if necessary, adjusts the estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch up basis, which would affect revenue and net loss in the period of adjustment. Research and development ( “ R&D ” ) expenses Research and development costs are expensed as incurred on an accruals basis in accordance with ASC Topic 730, Research and Development (“ASC 730”) because they have no alternative future uses. These expenses are comprised of the costs of the Company’s proprietary research and development efforts, including preclinical studies, clinical trials, manufacturing costs, employee salaries and benefits and share-based compensation expense, contract services including external research and development expenses incurred under arrangements with third parties such as contract research organizations (“CROs”), facilities costs, overhead costs and other related expenses. Intellectual property costs incurred on each drug candidate and costs associated with pre-commercial activities to support pricing and reimbursement by health technology assessment authorities and payor decision-makers in Europe are excluded from R&D expenses and are recognized within general and administrative expenses. Research and development costs that are paid in advance of performance are recorded as a prepaid expense and expensed over the service period as the services are provided. Accruals and prepayments for research and development expenses typically include fees and costs to be paid to CROs in relation to clinical trials and contract manufacturing organizations (“CMOs”) in relation to the manufacture of drug substance and drug product. These accruals and prepayments are calculated each period based on regular review and challenge by the relevant program manager of the detailed activity analysis provided directly by CROs and CMOs to determine their completeness and accuracy. Income taxes The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes (“ASC 740”), using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the consolidated financial statements or in its tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. The Company assesses the likelihood that deferred tax assets will be recovered in the future to the extent management believes, based upon the weight of available evidence, that it is more likely than not that all or a portion of the deferred tax assets will not be realized, a valuation allowance is established through a charge to income tax expense. Potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected and considering prudent and feasible tax planning strategies. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis. The Company accounts for uncertainty in income taxes by applying a two-step process to determine the amount of tax benefit to be recognized. First, the tax position is evaluated to determine the likelihood that it will be sustained upon external examination by the taxing authorities. If the tax position is deemed more-likely-than-not to be sustained, the tax position is then assessed as the amount of benefit to recognize in the consolidated financial statements. The amount of benefits that may be used is the largest amount that has a greater than 50% likelihood of being realized upon ultimate settlement. The provision for income taxes includes the effects of any resulting tax reserves, or unrecognized tax benefits, that are considered appropriate, as well as the related net interest and penalties. The Company recognizes interest related to unrecognized tax benefits within interest expense in the accompanying consolidated statements of operations and comprehensive loss. As of December 31, 2023 and 2022, no material accrued interest is included on the related tax liability line in the consolidated balance sheets. U.K. R&D tax credit The Company is subject to corporate taxation in the U.K. Due to the nature of the business, the Company has generated operating losses since inception. The benefit from R&D tax credits is recognized in the consolidated statements of operations and comprehensive loss, and represents the research and development tax credits recoverable in the U.K. The U.K. R&D tax credit is fully refundable to the Company and is not dependent on current or future taxable income. As a result, the Company has recorded the entire benefit from the U.K. R&D tax credit as a benefit which is included in net loss before income tax and, accordingly, not reflected it as part of the income tax provision. If, in the future, any U.K. R&D tax credits generated are needed to offset a corporate income tax liability in the U.K., the relevant portion would be recorded as a benefit within the income tax provision and any refundable portion not dependent on taxable income would continue to be recorded within the benefit from research and development tax credit in the consolidated statement of operations and comprehensive loss. As a company that carries out extensive R&D activities, it benefits from the U.K. HM Revenue and Customs (“HMRC”) small and medium sized enterprises research and development relief, or SME R&D Relief, which provides relief against U.K. Corporation Tax and enables it to surrender some of its trading losses that arise from its research and development activities for a cash rebate. To date, a cash rebate of up to 33.35 % of eligible R&D expenditure has been available, but the cash rebate reduced to a maximum of 27 % for R&D intensive companies where at least 40 % of their total expenditure in on qualifying R&D, or to 18.6 % of eligible R&D expenditure for other companies, with effect from April 1, 2023 pursuant to changes made by the Finance Act 2023. Certain subcontracted qualifying research expenditures are eligible for a cash rebate though the rate of the cash rebate also reduced with effect from April 1, 2023, from up to 21.67 % of the subcontracted expenditures to 17.53 % for R&D intensive companies or 12.09 % for other companie s. The difference in cash rebate for qualifying subcontracted expenditure vs. other qualifying expenditure is due to a statutory restriction of 65 % being applied to unconnected qualifying subcontracted expenditure, thus restricting the benefit available. The Company may not be able to continue to claim payable R&D tax credits in the future because it may no longer qualify as a small or medium sized company. In that case, the Company would expect to benefit from the taxable credit for qualifying R&D expenditure under the R&D Expenditure Credit (RDEC) scheme available to large companies which may be either offset against corporation tax liabilities or paid net of tax as a cash credit where there is no liability in the future. Expenditure subcontracted to other companies is not however a qualifying cost under the RDEC scheme. Subcontracted expenditure however is in most cases not a qualifying cost under the current RDEC scheme but is expected to be a qualifying cost (unless it relates to non-qualifying costs subcontracted overseas) under the new merged RDEC scheme, that will come into force for accounting periods beginning on or after April 1, 2024. In the event the Company generates revenues in the future, it may also benefit from the U.K. “patent box” regime that allows profits attributable to revenues from patents or patented product candidates to be taxed at an effective rate of 10 %. This relief applies to profits earned following election into the regime. When taken in combination with the enhanced relief available on our R&D expenditures, the Company expects a long-term lower rate of corporation tax to apply to it. If, however, there are unexpected adverse changes to the U.K. R&D tax credit regime or the “patent box” regime, or for any reason it is unable to qualify for such advantageous tax legislation, or it is unable to use net operating loss and tax credit carryforwards and certain built-in losses to reduce future tax payments, the Company's business, results of operations, and financial condition may be adversely affected. In particular, HM Treasury and HMRC launched a consultation in January 2023 entitled “R&D Tax Reliefs Review, Consultation on a single scheme” which seeks views on the possible merger of the SME R&D Relief scheme and the RDEC scheme applicable to large companies, the outcome of which may be further changes to the reliefs available. If it is decided to merge the schemes, any new regime is expected to apply with effect from April 1, 2024. Foreign currencies The Company maintains its consolidated financial statements in its functional currency, which is pound sterling. This is also the functional currency of the wholly-owned subsidiaries which are consolidated, with the exception of Mereo BioPharma 5, which has U.S dollars as its functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet dates. Non-monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the date of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the consolidated statements of operations and comprehensive loss. For financial reporting purposes, the consolidated financial statements of the Company have been presented in U.S. dollars, the reporting currency. The financial statements of entities are translated from their functional currency into U.S. dollars as follows: assets and liabilities are translated at the exchange rates at the balance sheet dates, revenue, operating expenses and other income/ (expense), net are translated at the average exchange rates for the periods presented, and shareholders’ equity is translated at the prevailing historical exchange rates. Translation adjustments are not included in determining net loss but are included as a foreign exchange adjustment to other comprehensive income, a component of shareholders’ equity. Property and equipment Property and equipment is stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of replacing part of the equipment if the recognition criteria are met. All other repair and maintenance costs are recognized in profit or loss as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Useful lives of various property and equipment are as follows: • Leasehold improvements shorter of lease term or ten years • Office equipment five years • IT equipment three years Property and equipment is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the consolidated statement of operations and comprehensive loss when the asset is derecognized. The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed annually and adjusted prospectively, if appropriate. Leases Leases are accounted for under ASC Topic 842, Leases (“ASC 842”). The Company only has operating leases. The Company assesses whether a contract is, or contains, a lease at inception of the contract. The Company recognizes a right-of-use (“ROU”) asset and a corresponding liability with respect to all lease arrangements in which it is a lessee. ROU assets and liabilities are recognized at the commencement date based on the present value of remaining lease payments. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. As the Company's leases do not provide an implicit rate, the Company determines the incremental borrowing rate in calculating the present value of lease payments. The ROU assets also include any lease payments made prior to commencement and are recorded net of any lease incentives received. The Company’s lease terms may include options to extend or terminate the lease. When it is reasonably certain the Company will exercise such options the term of the lease will be amended and the ROU asset and corresponding liability will be measured based on inclusion the option term. The Company accounts for lease and non-lease components separately. The non-lease components are service and maintenance charges and are accounted for separately. There are no variable lease costs associated with the current leases. Operating leases are included in right-of-use assets and in current and non-current operating lease liabilities on the Company's consolidated balance sheets. Lease expense for lease payments is considered operating lease costs and is recognized on a straight-line basis over the lease term. The lease terms for the underlying assets is as follows: • Right-of-use asset (building) six to nine years • Right-of-use asset (equipment) one to two years Intangible assets Identifiable intangible assets within the scope of ASC 730 that are purchased from others for a particular research and development project outside of a business combination, and that have no alternative future uses are expensed as i |
Recent accounting pronouncement
Recent accounting pronouncements | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Recent accounting pronouncements | Recent accounting pronouncements In November 2023, the FASB issued ASU 2023-07, Improvements to Reportable Segment Disclosures. The amendments require incremental disclosures related to a public entity’s reportable segments but does not change the definition of a segment, the method for determining segments, or the criteria for aggregating operating segments into reportable segments. The biggest change in the ASU is the requirement for a public entity to disclose its significant segment expense categories and amounts for each reportable segment. In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax disclosures. The standard requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The key provisions under effective tax rate reconciliations are as follows: • The ASU requires public business entities, on an annual basis, to provide a tabular rate reconciliation (using both percentages and reporting currency amounts) of the reported income tax expense (or benefit) from continuing operations, to the product of the income (or loss) from continuing operations before income taxes and the applicable statutory federal income tax rate of the country of domicile using specific categories, and; • Separate disclosure for any reconciling items within certain categories that are equal to or greater than a specified quantitative threshold. The quantitative threshold for the designated categories requiring further disaggregation is 5%. The key provisions under income taxes paid are as follows: • The ASU requires all reporting entities to disclose the year-to-date amount of income taxes paid (net of refunds received) disaggregated by federal, state, and foreign; and • It also requires additional disaggregated information on income taxes paid (net of refunds received) to an individual jurisdiction equal to or greater than 5% of total income taxes paid (net of refunds received). An entity may identify a country, state, or local territory as an individual jurisdiction. ASU 2023-07 is effective for fiscal periods beginning after December 15, 2023 and ASU 2023-09 is effective for fiscal periods beginning after December 15, 2024. We are currently evaluating the impact of the adoption of these ASU's on our consolidated financial statements, but do not believe the adoption of these standards will have a material impact on our consolidated financial statements. 'In March 2024, the SEC adopted final rules under SEC Release No. 33-11275, The Enhancement and Standardization of Climate-Related Disclosures for Investors, which requires registrants to provide certain climate-related information in their registration statements and annual reports. As it pertains to the financial statements, the final rules require the financial statement footnotes to include certain disclosures regarding the amounts of expenses (or capitalized costs) incurred that relate to severe weather events and other natural conditions, as well as other disclosures regarding the material impact on financial estimates and assumptions of severe weather events and other natural conditions or disclosed targets or transition plans. It also requires disclosure of financial statements amounts related to carbon offsets and renewable energy credits. The disclosures will be required at the earliest in the annual financial statements for the year ended December 31, 2025 (or potentially later depending on the company’s filer status at the time). The company is currently evaluating the impact of this on its consolidated financial statements. Other accounting standards that have been issued with the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company's consolidated financial statements upon adoption. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | 4. Fair value measurement The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, certain accrued expenses, contingent consideration, warrant liability and convertible loan notes. The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate their fair value due to the short-term nature of those financial instruments. The following table summarizes the Company’s financial assets and liabilities measured at fair value on a recurring basis and classified under the appropriate level of the fair value hierarchy as described above: As at December 31, 2023 Total Level 1 Level 2 Level 3 ($'000) ($'000) ($'000) ($'000) Financial liabilities Warrant liabilities 412 — 412 — CVR liability — — — — As at December 31, 2022 Total Level 1 Level 2 Level 3 ($'000) ($'000) ($'000) ($'000) Financial liabilities Warrant liabilities 643 — 157 486 CVR liability — — — — There were no transfers between Level 1 and Level 2 during the years ended December 31, 2023 and 2022. Contingent Value Rights Agreement Liability ("CVR liability") In 2019, the Company acquired OncoMed and subsequently renamed it Mereo BioPharma 5, Inc. The Company makes a provision for the estimated fair value of amounts payable to the former shareholders of Mereo BioPharma 5, Inc. under a Contingent Value Rights Agreement (“CVR”), established at the time of the acquisition of Mereo BioPharma 5, Inc which is accounted for as a contingent consideration liability. The CVR will expire on April 23, 2024. At December 31, 2023 and 2022, the Company estimates the fair value of the liability for its obligations under the CVR to be $ nil ( 2022: $nil). Total potential payments under the CVR on a gross, undiscounted basis, are approximately $ 80 million . The CVR liability is estimated based on a risk-adjusted, probability-based scenario. Under this approach the likelihood of future payments being made to the former shareholders of Mereo BioPharma 5, Inc. under the CVR is considered. The estimate could materially change over time in line with the development plan and potential subsequent commercialization of the product. These rights are contingent upon achieving certain milestones relating to two product candidates: etigilimab (“TIGIT”) and Navi. If the achievements are not met by April 2024, the agreement will expire. The CVR liability was $nil throughout both 2022 and 2023. The following table presents the changes in material Level 3 items for the years ended December 31, 2023 and December 31, 2022. Warrant labilities ($'000) January 1, 2022 11,276 Change in fair value ( 9,607 ) Foreign exchange ( 1,026 ) December 31, 2022 $ 643 Change in fair value ( 245 ) Foreign exchange 14 December 31, 2023 $ 412 The significant unobservable inputs used in the fair value measurements categorized within Level 3 of the fair value hierarchy, together with a quantitative sensitivity analysis as at December 31, 2023 and 2022 are as follows: Valuation technique Significant unobservable inputs Input range Sensitivity of the input to fair value Warrant liability related to the private placement warrants Black- Scholes model Expected volatility 2023: n/a 2022: 95.5 % The warrants expired in June 2023, therefore the fair value at December 31, 2023 was $nil CVR liability Discounted cash flow Ongoing uncertainty in the clinical development of the Navi product Total potential future payments relating to the contingent consideration liability on a gross, undiscounted basis are approximately $ 80 million. However, the agreement expires in April 2024. If none of the milestones are achieved, then no further payments will be required. Regulatory approval and commercialization risks Sensitivity of the input to fair value is primarily driven by uncertainty in the clinical development of the Navi product. Future potential payments under the CVR arrangement are contingent on i) future development milestones and ii) future sales of the Navi product, following regulatory approval and commercialization. In January 2020, the Company entered into the license agreement. Although pursuant to the license agreement the Company is entitled to additional payments of up to $ 302 million, there continues to be no expectation of any milestone or royalty payments under the license agreement before the CVR arrangement expires in April 2024. |
Prepaid expenses and other curr
Prepaid expenses and other current assets | 12 Months Ended |
Dec. 31, 2023 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepaid expenses and other current assets | 5. Prepaid expenses and other current assets Prepaid expenses and other current assets consisted of the following: December 31, 2023 2022 ($'000) ($'000) VAT receivable $ 599 $ 438 Prepaid research and development services 632 2,348 Other taxes receivable — 741 Insurance claim receivable 1,950 — Security deposits 615 485 Other prepaid expense and current assets 1,360 1,434 Total $ 5,156 $ 5,446 |
Property And Equipment , net
Property And Equipment , net | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment , net | 6. Property and equipment, net Property and equipment, net consists of the following: Year ended December 31, 2023 2022 ($'000) ($'000) Leasehold improvements $ 710 $ 675 Office equipment 199 190 IT equipment 296 422 Property and equipment, at cost 1,205 1,287 Less: accumulated depreciation ( 800 ) ( 736 ) Property and equipment, net $ 405 $ 551 Depreciation expense for the year ended December 31, 2023 was $ 0.2 million (2022: $ 0.2 million). |
Intangible assets
Intangible assets | 12 Months Ended |
Dec. 31, 2023 | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Intangible assets | 7. Intangible assets Intangible assets consists of the following: Year ended December 31, 2023 2022 ($'000) ($'000) License $ 1,485 $ — Less: accumulated amortization ( 396 ) — Intangible asset, net $ 1,089 $ — In 2023, the Company acquired an intangible asset of $ 1.5 million related to a license agreement. Corresponding deferred consideration liabilities totaling $ 1.5 million were also recognized in other current and other non-current liabilities. The license is amortized on a straight-line basis over its useful economic life. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Leases | . Leases In August 2015, Mereo entered into a lease agreement under which the Company leased office space located on the fourth floor of One Cavendish Place, London, with a lease term ending in August 2025. In June 2021, the Company entered into a new lease agreement to lease additional office space located on the fifth floor of that building for a lease period ending in June 2026 . At the same time, the Company entered into a revisionary lease to extend the term for the original fourth floor lease to be co-terminus with the fifth floor, ending in June 2026 . In August 2022, the Company’s lease for office space in Redwood City, California expired, and certain equipment was disposed. In the year-ended December 31, 2023, the Company made lease payments o f $ 0.8 million (2022: $ 1.2 million) and total lease expenses included in the statements of operations and comprehensive loss were $ 0.7 million (2022: $ 0.9 million ). There were no material variable lease costs. The amount of operating right of use assets recognized was $ 1.2 million in the year ended December 31, 2023 (2022: $ 1.7 million). Amortization of the right of use assets recognized in the statements of operations and comprehensive loss was $ 0.5 million in the year ended December 31, 2023 (2022: $ 0.7 million). Year ended December 31, 2023 2022 ($'000) ($'000) Operating leases Weighted-average remaining contractual lease term (years) 2.50 3.50 Weighted average discount rate 10.0 % 10.0 % Year ended December 31, 2023 2022 ($'000) ($'000) Cash paid for amounts included in the measurement of lease Operating cash flows from operating leases $ 759 $ 1,153 Year ended December 31, 2023 ($'000) Maturity analysis of the operating lease liabilities for the years ending December 31, 2024 $ 778 2025 778 2026 191 2027 — 2028 — Thereafter — Total undiscounted payments 1,747 Less: Present value discount ( 189 ) Lease liability $ 1,558 Lease liability - current $ 652 Lease liability - non current $ 906 |
Other Current Liabilities
Other Current Liabilities | 12 Months Ended |
Dec. 31, 2023 | |
Other Liabilities Disclosure [Abstract] | |
Other Current Liabilities | 9. Other current liabilities Other current liabilities consists of the following: December 31, 2023 2022 ($'000) ($'000) Social security and other taxes $ 280 $ 202 Tax payable — — Deferred consideration liability 711 — Other current liabilities 30 869 Total $ 1,021 $ 1,071 |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | 10. Accrued expenses Accrued expenses consist of the following: December 31, 2023 2022 ($'000) ($'000) Accrued research and development costs $ 1,821 $ 2,336 Accrued legal fees 266 132 Accrued bonus 1,624 1,863 Accrued audit fees 671 382 Accrued professional fees 338 183 Accrued local taxes 382 — Other accrued expenses 365 540 Total $ 5,467 $ 5,436 |
Convertible Loan Notes
Convertible Loan Notes | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Convertible Loan Notes | 11. Convertible loan notes Novartis Loan Note On February 10, 2020, the Company entered into a convertible equity financing with Novartis Pharma (AG) (“Novartis”) under which Novartis purchased a £ 3.8 million ($ 5.2 million) convertible loan note (the “Novartis Loan Note”). The Novartis Loan Note is convertible at the discretion of the holder, at a fixed price of £ 0.265 ($ 0.360 ) per ordinary share and originally bore interest at 6 % per annum with a maturity date of February 10, 2023 . In connection with the Novartis Loan Note, the Company also issued 1,449,614 warrants which are exercisable until February 2025 at an exercise price of £ 0.265 ($ 0.360 ) per ordinary share. These warrants were recognized separately as equity instruments (see note 12). Effective February 10, 2023, the maturity date of the Novartis Loan Note was extended to February 10, 2025 and the interest rate amended to 9 %. Interest accrued to the amendment date of $ 0.9 million was paid in cash, and additional warrants to purchase 2,000,000 ordinary shares were issued. These warrants were also recognized separately as equity instruments. The amendments to the Novartis Loan Note were an extinguishment of the original instrument and the issuance of a new one. Accordingly, on the extinguishment date, the carrying value of $ 5.5 million was derecognized. At the same time, a new liability of $ 4.2 million was recognized, which represents the portion of the consideration of the new arrangement allocated to the liability component of the new Novartis Loan Note on the basis of its relative fair value, net of fees. The remaining amount was allocated between the $ 0.8 million of interest paid in cash and the residual $ 0.5 million which was recorded in additional paid-in capital to reflect the relative fair value of the warrants and the conversion option embedded in the new Novartis Loan Note. No extinguishment gain or loss was recognized in the consolidated statements of operations and comprehensive loss. The Company recognized interest expense of $ 1.0 million in relation to the Novartis Loan Note in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2023 (2022: $ 1.5 million). The effective interest rate applied to the liability portion of the Novartis Loan Note in 2023 after the amendments was 27.8 % while the effective interest rate applied in 2023 prior to the amendments and in 2022 was 37.4 %. As of December 31, 2023, and 2022, the net carrying amount of the liability component of the convertible debt instrument was $ 4.6 million and $ 5.7 million, respectively. The fair value was $ 3.1 million (2022: $ 3.7 million). Private Placement Loan Notes The Private Placement Loan Notes were issued in 2020 as part of a $ 70.0 million private placement transaction which also included the issuance of ordinary shares and warrants (see Note 12). As of January 1, 2022, Private Placement Loan Notes with an aggregate principal of £ 12.4 million ($ 9.2 million) were still outstanding and were convertible at a fixed price of £ 0.174 per ordinary share. The Private Placement Loan Notes bore interest at a rate of 6 % per annum and had a maturity date of June 3, 2023 . During the year ended December 31, 2022, the Company issued and allotted 40,020,280 ordinary shares at a price of £ 0.174 per share on non-cash conversion of Private Placement Loan Notes with an aggregate principal amount of $ 7.5 million. On conversion, $ 0.2 million of unamortized transaction costs were recognized within interest expense. In May 2023, the maturity date of the Private Placement Loan Notes was extended to August 3, 2023 , with all other terms remaining unchanged. This extension was a modification and the carrying value of the liability component was adjusted to the present value of the modified cash flows discounted at the original effective interest rate, net of identifiable transaction costs . The carrying value was also reduced by $ 0.6 million with a corresponding adjustment to additional paid-in capital to reflect the increase in the fair value of the embedded conversion option. In May and July 2023, the Company received conversion notices and subsequently issued and allotted 17,774,895 and 9,645,200 ord inary shares respectively, both at a price of £ 0.174 per share on non-cash conversion of Private Placement Loan Notes with an aggregate principal amount of $ 4.6 million. In August 2023, the Company paid $ 3.2 million to fully settle the outstanding principal and accrued interest balance on the remaining Private Placement Loan Notes. The Company recognized interest expense of $ 1.6 million in relation to the Private Placement Loan Notes in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2023. The effective interest rate applied to the liability portion of the Private Placement Loan Notes in 2023 after the amendments was 27.1 % while the effective interest rate applied in 2023 prior to the amendments and in 2022 was 25.1 % . As of December 31, 2023 the net carrying amount of the convertible debt instrument was $nil (2022: $ 8.4 million) with unamortized debt discount and issuance costs of $nil (2022: $ 0.1 million). The fair value as of December 31, 2022 was $ 5.7 million). |
Warrant Liability
Warrant Liability | 12 Months Ended |
Dec. 31, 2023 | |
Warrants and Rights Note Disclosure [Abstract] | |
Warrant Liability | 12. Warrant liability December 31, 2023 2022 ($'000) ($'000) At January 1 $ 643 $ 11,276 Fair value changes during the year ( 245 ) ( 9,607 ) Foreign exchange 14 ( 1,026 ) At December 31 $ 412 $ 643 The change in fair value of the warrant liability represents an unrealized gain in the years ended December 31, 2023 and 2022. Warrant liability – private placement As a part of a private placement transaction on June 3, 2020, the participating investors received conditional warrants entitling them to subscribe for an aggregate of 161,048,366 ordinary shares in the Company at an exercise price of £ 0.348 ($ 0.443 ) per warrant and were exercisable until June 2023 when they expired. The warrants were classified as liabilities as the Company did not have an unconditional right to avoid redeeming the instruments for cash. As the warrants expired during the period, the fair value of the warrant liability was $nil as of December 31, 2023 (2022 $ 0.5 million). The change in the fair value of $ 0.5 million was recognized as a gain in the consolidated statements of operations and comprehensive loss. In the year ended December 31, 2023 no warrants were exercised. Warrant liability – bank loan As of December 31, 2023, the former lenders of the Company have warrants outstanding to purchase a total o f 1,243,908 ordinary shares at an exercise price of £ 2.95 per share ($ 3.76 per share), exercisable until August 2027 and a total of 1,243,908 ordinary shares at an exercise price of $ 0.4144 per share, exercisable until August 2027 to October 2028. As of December 31, 2023, the fair value of these warrants was $ 0.4 million (2022: $ 0.2 million). The change in the fair value of $ 0.3 million was recognized as a gain in the consolidated statements of operations and comprehensive loss. There were no warrants exercised during the year ended December 31, 2023 (2022: nil). Total outstanding warrants As of December 31, 2023, a total of 2,487,816 warrants are outstanding (2022: 147,431,351 ). The warrants outstanding are equivalent to 0.4 % of the issued ordinary share capital of the Company (2022: 24 %). The following table lists the weighted average inputs to the models used for the fair value of warrants: December 31, 2023 2022 Expected volatility (%) 102 95 Risk-free interest rate (%) 3.36 3.99 Expected life of warrants (years) 5.2 0.5 Market price of ADS ($) 2.31 0.75 Model used Black-Scholes Black-Scholes |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Shareholders' Equity | 13. Shareholders’ Equity Common Shares Number of Cost At December 31, 2021 584,908,239 2,333 Issued during the year 40,020,280 145 At December 31, 2022 624,928,519 2,478 Issued during the year 48,367,095 186 Conversion of convertible loan notes 27,420,095 108 Vesting of deferred restricted stock units 501,380 3 At December 31,2023 701,217,089 2,775 During the year ended December 31, 2022, the Company issued and allotted 40,020,280 ordinary shares of £ 0.003 in nominal value in the capital of the Company at an exercise price of £ 0.174 per share on non-cash conversion of loan notes. During the year ended December 31, 2023, Private Placement Loan Notes with a carrying value of $ 7.5 million were converted into 27,420,095 ordinary shares at a conversion price of £ 0.174 p er ordinary share. In July 2023, 9,673,419 A DSs representing 48,367,095 ordinary shares were issued for aggregate gross proceeds of $ 12.0 million through an “at-the-market” offering pursuant to an Open Market Sale Agreement with Jefferies LLC. During the year ended December 31, 2023, 501,380 ordinary shares were issued upon satisfaction of deferred restricted stock units. |
Revenue and Cost of Revenue
Revenue and Cost of Revenue | 12 Months Ended |
Dec. 31, 2023 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Revenue and Cost of Revenue | 14. Revenue and Cost of revenue Ultragenyx Partnership On January 25, 2021, the Company’s license and collaboration agreement with Ultragenyx for the development and commercialization of setrusumab for OI became effective. Under the terms of the agreement, the Company received an upfront payment of $ 50 million and was eligible to receive up to $ 254 million in development, regulatory and commercial milestones and tiered double digit percentage royalties on net sales outside of Europe and pay a fixed double digit percentage royalty to Ultragenyx on net sales in Europe. The license and collaboration agreement grants Ultragenyx an exclusive license to develop and commercialize setrusumab in the US and rest of the world, excluding Europe where the Company retains commercial rights. Two distinct performance obligations were identified as part of the license and collaboration agreement: (i) a promise to grant the license to develop and commercialize setrusumab, and (ii) provision of subsequent clinical supply of setrusumab. In the year ended December 31, 2023, the Company recognized milestone proceeds of $ 9 million as revenue under the license and collaboration agreement with Ultragenyx for setrusumab following achievement of a development milestone. The milestone payments constitute a change in transaction price for the Ultragenyx agreement, to which revenue was first recorded in the year ended December 31, 2021. Pursuant to the terms of the agreement, the Company is entitled to receive milestone payments from Ultragenyx upon achievement of certain development, regulatory and sales based milestones. The variable consideration relating to future milestones and sales royalties are recognized in the statement of comprehensive income when achievement of the milestones are probable or the underlying commercial sales are made, in the event regulatory approval is achieved. No revenues were recognized in respect of this agreement in the year ended December 31, 2022. As a consequence of the milestone received by the Company under the license and collaboration agreement with Ultragenyx, and in accordance with the terms of the 2015 asset purchase agreement with Novartis which requires payment of a percentage of the proceeds received, subject to certain deductions, the Company also recognized cost of revenue of $ 2.4 million. In 2021, the Company received a $ 50.0 million upfront payment from Ultragenyx which triggered a $ 13.3 million obligation to Novartis under our 2015 agreement with them. An amount of $ 3.3 million was deferred from this obligation to reflect future costs that were expected to be incurred. Accordingly, the Company recognized cost of revenue of $ 13.3 million to reflect both the $ 10.0 million payment made to Novartis and the recognition of a liability within Other current liabilities for this deferral. This liability was subsequently reduced through a credit to cost of revenue as the costs were incurred. Cost of revenue for 2022 was a credit of $ 1.1 million. ReproNovo Partnership On December 13, 2023, the Company and ReproNovo SA. (“ReproNovo”) announced a global licensing agreement for the development and commercialization of leflutrozole. Under the terms of the global licensing agreement, ReproNovo will receive an exclusive worldwide license to develop and commercialize leflutrozole. The Company received an upfront payment of $ 1.0 million in December 2023. ReproNovo will be responsible for all future research, development and commercialization of leflutrozole. Additionally, the Company will be eligible to receive up to $ 64.3 million in future clinical, regulatory and commercial milestones, tiered royalties ranging from the low-to-mid-single digits on global annual net sales of leflutrozole, as well as a negotiated percentage of sublicensing revenues from certain sublicenses. A single performance obligation was identified in this agreement which is the promise to grant the license to develop and commercialize leflutrozole. As the upfront payment is fixed and non-refundable, and therefore does not represent variable consideration, the performance obligation is satisfied and revenue of $ 1.0 million was recognized at the point in time that ReproNovo gained the right to access the license. The additional potential future milestone and royalty payments represent variable consideration that will be recognized when achievement is determined to be probable. As a consequence of the milestone proceeds paid to the Company under the license and collaboration agreement with ReproNovo, and in accordance with the terms of the 2015 asset purchase agreement with Novartis, the Company is also obligated to pay a proportion of cash milestone payments received after deduction of costs, charged and expenditures. The Company therefore accrued for a payment to Novartis of $ 0.1 million at December 31, 2023. No revenues were recognized in respect of this agreement in the year ended December 31, 2022. The Company's revenue is attributed to the operations of the Company in the U.K. |
Other Income_(expenses) , Net
Other Income/(expenses) , Net | 12 Months Ended |
Dec. 31, 2023 | |
Other Income and Expenses [Abstract] | |
Other Income/(expenses) , Net | 15. Other (expenses)/income, net In 2019, the Company acquired OncoMed in a business combination and subsequently renamed it Mereo BioPharma 5, Inc. At the time of the business combination, the Company’s intention was to sell or out-license Navi, rather than to invest in development of the asset in the course of the Company’s ordinary activities. In the approximately nine months between its acquisition and out-licensing of the worldwide rights of the asset in January 2020, Mereo BioPharma 5, Inc’s activities primarily involved out-licensing and winding-down the program. Due to the Company’s intention to sell or out-license Navi from the time of its acquisition and the lack of investment in development activities for the asset beyond wind-down costs, the Company concluded that entering into the license agreement was not in the course of its ordinary activities. Therefore, the licensee did not meet the definition of a “customer” as defined in ASC 606, as such, the license agreement was determined not to be within the scope of ASC 606. In February 2022, the Company received a milestone payment of $ 2.0 million under the Navi License Agreement. An associated payment was made to the former shareholders of Mereo BioPharma 5, Inc. under the CVR of $ 0.9 million, after deductions of costs, charges and expenditures, which resulted in other income, net of $ 1.1 million. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 16. Income taxes The group operates in the U.K. and in the U.S. and is subject to income taxes in those countries. The U.K corporation tax rate applied for 2023 was 23.52 % (2022: 19.0 %), which results from applying the enacted statutory rate of 19 % from January 1, 2023 through April 1, 2023, and 25 % for the remainder of 2023. U.K. deferred tax assets and liabilities have been measured at a rate of 25 % . T he U.S federal income tax rate is 21 %. U.S. deferred tax assets and liabilities are calculated at a enacted rate of 21 %. The components of loss before income taxes are as follows: Year ended December 31, 2023 2022 ($'000) ($'000) United States $ 8,464 $ 19,934 United Kingdom 21,534 23,004 Total $ 29,998 $ 42,938 The components of income tax expense are as follows: Year ended December 31, 2023 2022 ($'000) ($'000) Current tax expense United States $ ( 2 ) $ ( 2 ) United Kingdom 534 720 Total current tax expense/(credit) $ 532 $ 718 Deferred tax expense United States — — United Kingdom — — Total deferred tax expense $ — $ — Total income tax expense/(credit) $ 532 $ 718 A reconciliation of the U.K statutory income tax rate to the effective tax rate is as follows: Year ended December 31, 2023 2022 (%) (%) Income tax using U.K. statutory rate 23.5 19.0 Effect of rate change on opening tax balances — — Effect of rate change on current and deferred taxes — — Permanent differences ( 5.4 ) ( 5.3 ) U.K. R&D tax credits ( 1.9 ) ( 1.4 ) Changes in deferred tax valuation allowance ( 15.7 ) ( 13.9 ) Foreign rate differential ( 0.7 ) 0.9 Adjustments in respect of prior years 1.9 1.8 Other 0.2 1.2 Effective tax rate for loss from continuing operations 1.77 1.8 Components of the Company’s deferred tax assets and liabilities are as follows: Year ended December 31, 2023 2022 ($'000) ($'000) Deferred tax assets: Operating losses carryforwards $ ( 110,604 ) $ ( 104,874 ) Property and equipment ( 17 ) ( 0 ) Intangible fixed assets ( 4,248 ) ( 7,281 ) Temporary differences trading 56 ( 53 ) Temporary differences non trading ( 7 ) ( 8 ) Loan relationships ( 553 ) ( 548 ) U.S. tax credits ( 79,024 ) ( 73,276 ) Section 174 R&E ( 4,437 ) ( 3,711 ) Share based compensation awards ( 7,487 ) ( 7,492 ) Others ( 23 ) Gross deferred tax asset ( 206,344 ) ( 197,243 ) Valuation allowance $ 206,344 $ 197,243 Net deferred tax assets $ — $ — Deferred tax liabilities: Depreciation $ 32 $ 218 Right-of-use assets — — Intangible assets — — Net deferred tax liabilities $ 32 $ 218 Total deferred tax, net $ ( 32 ) $ ( 218 ) Movements in deferred tax valuation allowance: Year ended December 31, 2023 2022 ($'000) ($'000) Valuation allowance at January 1 $ 197,243 $ 182,723 Change in tax rates — — Increase/(decrease in valuation allowance) 9,101 14,520 Valuation allowance at December 31 $ 206,344 $ 197,243 Management has reviewed cumulative tax losses and projections of future taxable losses and determined that it is not more likely than not that they will be realized. Accordingly, valuation allowances have been provided over deferred tax assets. As of December 31, 2023 the Company had U.K. net operating loss carryforwards of $ 30.6 million that can be carried forward indefinitely. The Company had U.S. federal tax losses to be carried forward of $ 66.2 million, of which $ 18.2 million can be carried forward indefinitely and $ 48.0 million will begin to expire in 2024. The Company also had $ 14.0 million of U.S. federal R&D tax credits that begin to expire in 2024 and U.S. state tax losses to be carried forward of less than $ 0.1 million which begin to expire in 2027. The Company also had less tha n $ 0.1 million of state R&D tax credits that do not have an expiration date. As of December 31, 2022 the Company had U.K. net operating loss carryforwards of $ 28.7 million that can be carried forward indefinitely, U.S. federal tax losses to be carried forward of approximately $ 65.2 million, of which $ 17.2 million can be carried forward indefinitely and $ 48.0 million which will begin to expire in 2023 . The Company also had $ 14.0 million of U.S. federal research and development (“R&D”) tax credits that began to expire in 2022 and U.S. state tax losses to be carried forward of less than $ 0.1 million which begin to expire in 2027. The Company also had less than $ 0.1 million of state R&D tax credits that do not have an expiration date. The Company files separate income tax returns in the U.K. and the U.S. All necessary income tax filings have been completed for all years up to and including December 31, 2022, and there are no ongoing tax examinations in any jurisdiction. As of December 31, 2023, the Company has an uncertain tax position of $ 2.9 m illion, representing 20 % of historic R&D tax losses claimed for Alternative Minimum Tax ("AMT") specific to the year ending December 31, 2022. For Mereo BioPharma 5, Inc, with respect to accumulated tax losses carried forward prior to its acquisition by the Company, of $ 18.2 million, there is a change of control restriction which will limit the amount available in any one year to $ 0.3 million per year. |
Share Based Compensation
Share Based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share Based Compensation | 17. Share-based compensation The Company currently grants equity awards under the Mereo 2019 Equity Incentive Plan (the "2019 EIP") and the 2019 Non-Employee Equity Incentive Plan (the “2019 NED EIP”). There are also still outstanding awards under two previous plans, the 2015 Plan and the Mereo Share Option Plan (together the "Previous Share Option Plans"), however no awards have been granted under these plans since 2016 and no further grants are envisaged. The 2019 EIP and 2019 NED EIP were adopted on April 4, 2019, and subsequently amended on February 3, 2020 and January 15, 2021. The 2019 EIP and 2019 NED EIP authorizes the grant of a variety of types of share awards over the Company’s ADSs to executives and employees, and non-executives, respectively. The total number of ADSs available for issue under the 2019 EIP and 2019 NED EIP was 4.7 m illion as of December 31, 2023. The charge for share based compensation arises solely in respect of awards made under these two active plans as follows: Year ended December 31, 2023 2022 ($'000) ($'000) 2019 EIP 4,064 3,888 2019 NED EIP 860 880 Total 4,924 4,768 As of December 31, 2023, the total unrecognized compensation cost related to outstanding share awards was $ 2.9 million, which the Company expects to recognize over a weighted-average period of 1.6 years . The majority of awards that were exercised in 2023 and 2022 were net share settled such that the Company withheld shares with a value equivalent to the exercise price and the employees’ obligation for the applicable income and other employment taxes and remitted the cash to the appropriate taxing authorities. The remaining shares delivered upon exercise by employees were satisfied by delivering shares from the Employee Benefit Trust. Shares delivered in settlement of deferred RSUs to non-executive directors following separation of service were satisfied by issuing new shares. 2019 EIP The Company has awarded the following instruments under the 2019 EIP: Market Value Options (“Options”) Options permit the recipient to purchase ADSs at an exercise price equal to the market price of the underlying ADSs on the date of grant. Options issued under the EIP have a contractual term of 10 years and vest over four years, with one-fourth of the award vesting on the first anniversary of the grant date and the remainder vesting in equal monthly installments over the three-year period thereafter. No performance conditions apply to such Options. A summary of the Company’s Option activity and related information under the 2019 EIP for 2023 and 2022 is as follows; all outstanding Options are expected to vest: Number of Weighted Weighted Aggregate intrinsic At January 1, 2022 3,943,702 2.88 2.40 — Granted 4,126,400 1.38 3.09 — Forfeited ( 48,044 ) 3.97 3.09 — Expired ( 1,164,197 ) 1.83 1.58 — At December 31, 2022 6,857,861 2.15 1.83 1 Granted 4,874,300 1.03 0.92 — Forfeited ( 1,324,809 ) 1.42 1.27 — Expired ( 751,672 ) 2.82 2.35 — Exercised ( 60,519 ) 1.57 1.29 45 At December 31, 2023 9,595,161 1.63 1.41 8,122 Vested 3,425,209 2.27 1.91 1,463 Nonvested 6,169,952 1.27 1.13 6,670 At December 31, 2022, 4,775,834 Options with a weighted average grant date fair value of $ 1.57 were nonvested. The weighted average per share fair value of options vesting during the year ended December 31, 2023 was $ 1.55 (2022: $ 2.45 ). At December 31, 2023, the weighted average contractual life of Options outstanding was 8 .1 years (2022: 7 .9 years) and for vested Options was 7.1 years (2022: 6.2 years). The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the quoted market price of the Company’s ADSs for the Options that were in-the-money at December 31, 2023. The fair value of each Option is estimated on the date of grant using the Black-Scholes option pricing model based on the following weighted average assumptions: 2023 2022 Market value of ADSs ($) 1.03 1.38 Risk-free interest rate (%) 3.48 % 1.83 % Expected life (years) 10.00 10.00 Expected volatility (%) 98.24 % 96.00 % Expected dividends — — The expected volatility assumption is calculated by reference to the historical volatility of an appropriate peer group of companies for a period equal to the expected term of the Option. The grant date fair value is recognized over the requisite service period using the accelerated graded-vesting attribution method. Restricted Stock Units (“RSUs”) RSUs were first awarded in 2023 and each RSU entitles the holder a conditional right to receive an ADS at no cost upon the completion of the applicable vesting period. RSUs granted under the EIP vest over three years with one-third of the awards vesting on the first anniversary of the grant date and the remainder vesting in four equal six-monthly installments thereafter. Upon vesting of the RSUs, the Company issues the requisite ADSs, a portion of which are sold to satisfy the resulting withholding tax obligations, and the remaining ADSs are delivered to the holder . RSUs have a maximum contractual life of 3.0 years. A summary of the Company’s RSU activity and related information under the 2019 EIP for 2023 is as follows. As at December 31, 2023 no RSUs were vested but all outstanding RSUs are expected to vest: Number of Weighted Aggregate intrinsic At December 31, 2022 — — — Granted 679,225 1.03 Forfeited ( 190,000 ) 1.01 At December 31, 2023 489,225 1.03 1,130 At December 31, 2023, the weighted average remaining period of RSUs outstanding was 2.1 years. The aggregate intrinsic value is calculated as the quoted market price of the Company’s ADSs at December 31, 2023. The fair value of each RSU was calculated by reference to the value of the shares awarded. The grant date fair value is recognized over the vesting period using the accelerated graded-vesting attribution method. Performance Based Restricted Stock Units (PSUs) PSUs were first awarded in 2023 and each PSU entitles the holder a conditional right to receive an ADS at no cost upon satisfaction of four escalating ADS price performance targets over a two year performance period following the date of grant. A summary of the Company’s PSU activity and related information under the 2019 EIP for 2023 is as follows. At December 31, 2023 no PSUs were vested. Number of Weighted Aggregate intrinsic At December 31, 2022 — — — Granted 1,543,150 0.61 — Forfeited ( 205,000 ) 0.61 — At December 31, 2023 1,338,150 0.61 3,091 At December 31, 2023, the weighted average contractual life of PSUs outstanding was 1.1 years. These awards were valued using a Monte Carlo model with the following key inputs: 2023 Market value of ADSs ($) 1.01 Risk-free interest rate (%) 4.14 % Expected life (years) 1.03 Expected volatility (%) 105.56 % Expected dividends — The grant date fair value is recognized over the expected life using the straight-line attribution method. 2019 NED EIP The Company has awarded the following instruments under the 2019 NED EIP: Options Options permit the recipient to purchase ADSs at an exercise price equal to the market price of the underlying ADSs on the date of grant. Options issued under the 2019 NED EIP have a contractual term of 10 years and vest in equal monthly installments over one year. There are no performance conditions. A summary of the Company’s Option activity and related information under the 2019 NED EIP for 2023 and 2022 is as follows; all outstanding Options are expected to vest: Number of Weighted Weighted Aggregate intrinsic value ($'000) At December 31, 2021 421,791 2.90 2.44 — Granted 535,488 1.22 1.08 — Forfeited ( 42,192 ) 1.01 0.89 — At December 31, 2022 915,087 2.00 1.71 6 Granted 440,000 0.94 0.84 — At December 31, 2023 1,355,087 1.66 1.43 1,166 Vested 1,281,751 1.70 1.46 1,066 Nonvested 73,336 0.94 0.84 100 At December 31, 2022, 82,503 Options with a weighted average grant date fair value of $ 1.01 were nonvested. The weighted average per share fair value of options vesting during the year ended December 31, 2023 was $ 1.38 (2022: $ 1.78 ). At December 31, 2023, the weighted average contractual life of Options outstanding was 8.0 years (2022: 8.5 years) and for vested Options was 7.9 years (2022: 8.4 years). The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the quoted market price of the Company’s shares for the Options that were in-the-money at December 31, 2023. The fair value of each Option is estimated on the date of grant using the Black-Scholes option pricing model based on the following weighted average assumptions: 2023 2022 Market value of ADSs ($) 0.94 1.22 Risk-free interest rate (%) 3.36 % 1.96 % Expected life (years) 10.00 10.00 Expected volatility (%) 97.94 % 96.00 % Expected dividends — — The expected volatility assumption is calculated by reference to the historical volatility of an appropriate peer group of companies for a period equal to the expected term of the Option. The grant date fair value is recognized over the vesting period using the accelerated graded-vesting attribution method. Deferred Restricted Stock Units (“DRSUs”) Non-executive directors may voluntarily elect to convert their annual cash fees for services on the board of directors and DRSUs were granted to NEDs who made such elections. The number of DRSUs granted is determined by dividing the amount of the annual cash compensation by the average closing trading price of the Company's ADSs over the most recent 30 trading days as of the date of grant. Each DRSU entitles the holder to receive an ADS at no cost upon the completion of the vesting period. DRSUs granted under the 2019 NED EIP vest in substantially equal monthly installments over the plan year. Payment of DRSUs in ADSs will generally be 180 days following separation of service but have no specified contractual term. A summary of the Company’s DRSU activity and related information under the 2019 NED EIP for 2023 and 2022 is as follows. At December 31, 2023 all DRSUs are expected to vest: Number of Weighted Aggregate intrinsic value ($'000) At January 1, 2022 — — — Granted 348,044 1.11 — Forfeited — — — At December 31, 2022 348,044 1.11 261 Granted 482,214 0.94 — Issued ( 100,276 ) 1.02 At December 31, 2023 729,982 1.01 1,686 Vested 689,837 1.02 1,594 Non vested 40,145 0.94 93 The aggregate intrinsic value is calculated as the quoted market price of the Company’s ADSs at December 31, 2023. The fair value of each DRSU was calculated by reference to the value of the shares awarded. The grant date fair value is recognized over the vesting period using the accelerated graded-vesting attribution method. Previous Share Option Plans Mereo previously granted options to employees under two separate plans, the Mereo BioPharma Group Limited Share Option Plan (the “2015 Plan”) and the Mereo Share Option Plan (the “Share Option Plan”). No awards have been granted under either of these plans since 2017 and following the introduction of the 2019 EIP and the 2019 NED EIP, no further awards are envisaged. All awards made under these plans became fully vested, with all compensation cost fully recognized, before December 31, 2021. A summary of the awards still outstanding under these plans is as follows: Number of Weighted Weighted Aggregate intrinsic value ($'000) At December 31, 2021 1,924,331 10.45 9.39 — Expired ( 240,776 ) 16.31 11.04 — At December 31, 2022 1,683,555 9.63 9.15 — Expired ( 111,197 ) 15.94 8.11 — At December, 31, 2023 1,572,358 9.22 8.19 — At December 31, 2023, the weighted average contractual life of options outstanding and vested was 1.8 years (2022: 2.4 years). |
Loss Per Share
Loss Per Share | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Loss Per Share | 18. Loss per share Basic loss per share is calculated by dividing the loss attributable for the year to ordinary equity holders of the Company by the weighted average number of ordinary shares outstanding during the year. Diluted loss per share is based on dividing the loss attributable for the year, adjusted for the effect of diluted ordinary shares, by ordinary share equivalents, which includes the weighted average number of ordinary shares outstanding and the effect of dilutive ordinary share equivalents. Year ended December 31, 2023 2022 ($'000, except per share amounts) ($'000, except per share amounts) Net loss $ ( 29,466 ) $ ( 42,220 ) Net loss per share - basic and diluted $ ( 0.04 ) $ ( 0.07 ) Weighted-average number of shares used in computing net loss per share - basic and diluted 659,453,921 603,196,403 Years ended December 31, 2023 2022 Stock options to purchase ordinary shares 54,751,240 38,864,740 Restricted stock units 2,446,125 — Performance stock units 6,690,750 — Convertible loan notes (as converted to ordinary shares) 15,657,825 17,010,137 Convertible loan notes - private placement (as converted to ordinary shares) — 41,048,784 Warrants to purchase ordinary shares (as converted to ordinary shares) 2,487,816 147,431,351 For the years ended December 31, 2023 and 2022, share options, restricted stock units, convertible loan notes and warrants were anti-dilutive as they would have decreased the loss per share and were excluded from the calculation of diluted loss per share. Therefore, the weighted average shares outstanding used to calculate both the basic and diluted loss per share was the same. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 19. Commitments and contingencies Indemnification agreements In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnification. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future. To date, the Company has not paid any claims or been required to defend any action related to its indemnification obligations. However, the Company may record charges in the future as a result of these indemnification obligations. In accordance with the Articles of Association in force on December 31, 2023, the Company has indemnification obligations to its officers and directors for certain events or occurrences, subject to certain limits, while they are serving at the Company’s request in such capacity. There have been no claims to date, and the Company has directors and officers insurance that may enable it to recover a portion of any amounts paid for future potential claims. Novartis Asset Purchase Agreements The Company issued to Novartis loan notes and agreed to make future payments to Novartis comprising amounts equal to ascending specified percentages of tiered annual worldwide net sales (beginning at high single digits and reaching into double digits at higher sales) of products that include the assets acquired. The levels of ascending percentages of tiered annual worldwide net sales are stipulated under the respective Purchase Agreements. The Company further agreed that in the event it transfers, licenses, assigns or leases all or substantially all of its assets, it will pay Novartis a percentage of the proceeds of such transaction. The payment of a percentage of proceeds is not payable with respect to any transaction involving equity interests of Mereo BioPharma Group plc, a merger or consolidation of Mereo BioPharma Group plc, or a sale of any assets of Mereo BioPharma Group plc. License agreement with AstraZeneca In October 2017, the Company entered into an exclusive license and option agreement (“the License Agreement”), to obtain from AstraZeneca an exclusive worldwide, sub-licensable license under AstraZeneca’s intellectual property rights relating to alvelestat, with an option to acquire such intellectual property rights following commencement of a pivotal trial and payment of related milestone payments (“the Option”), together with the acquisition of certain related assets. Upon entering into the License Agreement, the Company made a payment of $ 3.0 million and issued 490,798 ordinary shares to AstraZeneca, for an aggregate upfront payment equal to $ 5.0 million. In connection with certain development and regulatory milestones, the Company has agreed to make payments of up to $ 115.5 million in the aggregate and issue additional ordinary shares to AstraZeneca for licensed products containing alvelestat. In addition, the Company has agreed to make payments to AstraZeneca based on specified commercial milestones of the product. The Company has also agreed to pay a specified percentage of sub-licensing revenue to AstraZeneca and to make royalty payments to AstraZeneca equal to ascending specified percentages of tiered annual worldwide net sales by the Company of licensed products (subject to certain reductions), ranging from the high single digits to low double digits. Royalties will be payable on a licensed-product-by-licensed-product and country-by-country basis until the later of ten years after the first commercial sale of such licensed product in such country and expiration of the last patent covering such licensed product in such country that would be sufficient to prevent generic entry. The Company has agreed to use commercially reasonable efforts to develop and commercialize at least one licensed product. The License Agreement will expire on the expiry of the last-to-expire royalty term with respect to all licensed products. Upon the expiration of the royalty term for a licensed product in a particular country, the licenses to the Company for such product in such country will become fully paid and irrevocable. Prior to exercise of the Option, if at all, the Company may terminate the License Agreement upon prior written notice. Either party may terminate the agreement upon prior written notice for the other party’s material breach that remains uncured for a specified period of time or insolvency. Research and development activities The Company enters into contracts in the normal course of business with CROs, CMOs and other third parties to assist in the performance of research and development activities and other services and products for operating purposes. The contracts with CROs generally provide for termination on notice, and therefore, are cancellable contracts and not included herein. The Company has manufacturing commitments with CMOs of $ 4.2 million as of December 31, 2023 (2022: $ 1.1 million). Legal proceedings From time to time, the Company may be a party to litigation or subject to claims incident to the ordinary course of business. The Company was not a party to any material litigation and did not have any material contingency reserves established for any liabilities as of December 31, 2023 and 2022. |
Related Party Disclosures
Related Party Disclosures | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related party disclosures | . Related party disclosures In the years ended December 31, 2023 and 2022, there were no reportable related party transactions. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for annual financial reporting. The consolidated financial statements are presented in U.S. dollars (“$”), which is the reporting currency of the Company. The functional currency of the Company is pound sterling (“£”). The functional currency of consolidated subsidiaries are pound sterling and U.S. dollar. All amounts disclosed in the consolidated financial statements and notes have been rounded to the nearest thousand, unless otherwise stated. At the end of the second quarter of 2023, the Company determined that it no longer qualified as a Foreign Private Issuer under SEC rules. As a result, beginning January 1, 2024, the Company was required to report with the SEC on domestic forms and comply with domestic company rules in the United States. The transition to U.S. GAAP was made retrospectively for all periods from the Company’s inception. |
Going concern | Going concern The Company has prepared its financial statements on the basis that it will continue as a going concern. In accordance with the Financial Accounting Standards Board (“FASB”), Accounting Standards Update (“ASU”) 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40), the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern. The Company is subject to risks common to companies in the biotechnology industry, including but not limited to, risks of delays in initiating or continuing research programs and clinical trials, risks of failure of preclinical studies and clinical trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the need to successfully commercialize and gain market acceptance of its product candidates, if approved, dependence on key personnel and collaboration partners, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations, and the ability to secure additional capital to fund operations. Product candidates currently under development will require significant additional research and development efforts, including preclinical and clinical testing and regulatory approval prior to commercialization. Even if the Company’s research and development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales. The Company has historically been loss making and anticipates that it will continue to incur losses for the foreseeable future and had an accumulated deficit of $ 419.6 million as of December 31, 2023. The Company has funded these losses through a combination of public equity, private equity and debt financings, and it expects it will continue to do so until such time as it can generate significant revenue from product sales, or other commercial revenues, if ever, or through licensing and/or collaboration agreements for its rare disease or oncology product candidates. 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. Geopolitical events, including the ongoing global conflicts and increasing economic and political uncertainty have continued in 2023. This has led to significant increases in commodity prices, energy and fuel prices, credit and capital market instability (particularly in the life sciences sector) and supply chain interruptions, all of which have contributed to increasing inflation and higher market interest rates. This may in turn adversely impact the Company’s ability to deliver its goals. As of December 31, 2023, the Company had cash and cash equivalents of $ 57.4 million. The Directors and Management have reviewed the financial projections of the Company for the 12 months subsequent to the date of filing of this Annual Report on Form 10-K including consideration of severe but plausible scenarios that may affect the Company in that period. The Company expects that its cash and cash equivalents as of December 31, 2023 will be sufficient to fund its operations and capital expenditure requirements for at least twelve months from the date of filing of this Annual Report on Form 10-K. |
Basis of consolidation | Basis of consolidation The consolidated financial information comprises the financial statements of Mereo BioPharma Group plc and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated on consolidation. The Company has an employee benefit trust (“EBT”) to facilitate share transactions pursuant to employee share schemes. Although the trust is a separate legal entity from the Company, it is consolidated into the Company’s results in accordance with the rules in ASC Topic 810, Consolidations (“ASC 810”) on special purpose entities. The Company is deemed to control the trust principally because the trust cannot operate without the funding the Company provides. |
Use of estimates | Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting periods. Significant estimates and assumptions reflected in these financial statements include, but are not limited to, revenue recognition on contracts with customers and convertible loan notes. 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. |
Segmental information | Segmental information Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker in deciding how to allocate resources and assess performance. The Company and the Company’s chief operating decision maker, the Company’s Chief Executive Officer, view the Company’s operations and manage its business as a single operating segment, which is the business of developing rare disease therapies; however, the Company operates in two geographic regions: the U.K. and the U.S. The Company’s non-current assets are primarily located in the U.K. As of December 31, 2023, $ 0.1 million (2022: $ 0.1 million) o f property and equipment are located in the U.S. |
Concentration of credit risk and significant counterparties | Concentration of credit risk and significant counterparties The Company is dependent on a number of third parties for the delivery of its programs and, where required, pays upfront deposits and fees in advance of the delivery of services. The Company considers all of its material counterparties to be creditworthy and the credit risk for each of its major counterparties to be low, but continues to assess credit risk as part of its management of these third-party relationships. Financial instruments that subject the Company to credit risk consists primarily of cash and cash equivalents. The Company places cash and cash equivalents with established financial institutions with strong credit ratings. The Company’s maximum exposure to credit risk for the components of the balance sheet of December 31, 2023 are the carrying amounts. The Company has no significant off-balance sheet risk or concentration of credit risk, such as foreign exchange contracts, options contracts, or other foreign hedging arrangements. |
Revenue | Revenue The Company’s ongoing major or central operations are the development of product candidates to key clinical milestones and either strategically partnering them or further developing such product candidates through regulatory approval and potentially commercialization. The Company may enter into a range of different agreements with third parties, including but not limited to: (i) licensing agreements where the global rights to a product candidate are licensed to a partner; and (ii) collaboration agreements where rights to a product candidate are licensed to a partner but the Company retains certain rights, for example to further develop or commercialize the product candidate in specified geographical territories. Under both licensing and collaboration agreements, rights to product candidates are provided to a partner typically in exchange for consideration in the form of upfront payments and/or development, regulatory, commercial or other similar milestones, and royalties on commercial sales, should regulatory approval be obtained for the product candidates. The terms of these arrangements typically include payment to the Company of one or more of the following: nonrefundable, upfront license fees; payments for research and development services; fees upon the exercise of options to obtain additional services or licenses; payments based upon the achievement of defined collaboration objectives; future regulatory and sales-based milestone payments; and royalties on net sales of future products. Where the Company has performed significant development activities for its product candidates, including the setrusumab and leflutrozole partnerships described in Note 14, receipts from agreements with third parties are considered to be proceeds derived from customers of the Company’s ongoing major or central operations and therefore the Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”). When this is not the case and the third parties are not receiving outputs from the Company's ongoing or major central operations, such as in the Navicixizumab (“Navi”) partnership described in Note 15, the third parties are not considered to be customers and the Company accounts for receipts from these agreements as other income in accordance with ASC Topic 610, Gains and Losses from the Derecognition of Non-financial Assets. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, it 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; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when, or as, the Company satisfies the performance obligations. The Company only applies the five-step model to contracts when it is probable that the entity will collect substantially all of the consideration it is entitled to in exchange for the goods or services it transfers to the customer. As part of the accounting for these arrangements, the Company must make significant judgments, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each performance obligation. Once a contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within the 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. Performance obligations are promised goods or services in a contract to transfer a distinct good or service to the customer. The promised goods or services in the Company’s contracts with customers primarily consist of license rights to the Company’s intellectual property, research and development services and options to obtain additional licenses, such as a commercialization license for a potential product candidate. Promised goods or services are considered distinct when: (i) the customer can benefit from the good or service on its own or together with other readily available resources, and (ii) the promised good or service is separately identifiable from other promises in the contract. In assessing whether promised goods or services are distinct, the Company considers factors such as the stage of development of the underlying intellectual property, the capabilities of the collaboration partner to develop the intellectual property on their own and whether the required expertise is readily available. In addition, the Company considers whether the customer can benefit from a promise for its intended purpose without the receipt of the remaining promises, whether the value of the promise is dependent on the unsatisfied promises, whether there are other vendors that could provide the remaining promises, and whether it is separately identifiable from the remaining promises. The Company estimates the transaction price based on the amount of consideration the Company expects to receive for transferring the promised goods or services in the contract. The consideration may include both fixed consideration and variable consideration. At the inception of each arrangement that includes variable consideration, the Company evaluates the amount of the potential payments and the likelihood that the payments will be received. The Company utilizes either the most likely amount method or expected value method to estimate variable consideration to include in the transaction price based on which method better predicts the amount of consideration expected to be received. 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 reevaluates 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. The initial transaction price of a contract does not include amounts associated with customer option payments. After the transaction price is determined, it is allocated to the identified performance obligations based on the estimated standalone selling price. The Company must develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract. The Company utilizes key assumptions to determine the standalone selling price, which may include other comparable transactions, pricing considered in negotiating the transaction, probabilities of technical and regulatory success and the estimated costs. Based on the current agreements in effect, there is limited judgment in determining the revenue and transaction price. Certain variable consideration is allocated specifically to one or more performance obligations in a contract when the terms of the variable consideration relate to the satisfaction of the performance obligation and the resulting amounts allocated to each performance obligation are consistent with the amounts the Company would expect to receive for each performance obligation. 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 at a point in time or over time, and if over time, the facts and circumstances of each respective contract will be used to determine the revenue recognition pattern. The Company currently does not have any revenue that is being recognized over a time period. Payments to third parties arising as a direct consequence of the revenue recognized are also recorded within cost of revenue in the Company’s consolidated statements of operations and comprehensive loss. License revenue The Company has no approved product candidates and accordingly has not generated any revenue from commercial product sales. Revenue to date has been generated principally from licensing arrangements and collaboration agreements with a small number of the Company's customers. If a license to the Company's intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenues from non-refundable, upfront fees allocated to the license at such time as the license is transferred to the licensee and the licensee is able to use, and benefit from, the license. Contingent milestone payments The Company's licensing arrangements and collaboration agreements may include development, regulatory and sales milestones. ASC 606 constrains the amount of variable consideration included in the transaction price in that either all, or a portion, of variable consideration should be included in the transaction price. The variable consideration should be included only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The Company evaluates the probability of the milestones being reached and estimates the amount to be included in the transaction price using the most likely amount method. The Company evaluates factors such as the scientific, clinical, regulatory, commercial and other risks that much be overcome to achieve the particular milestone in making this assessment. 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, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. At the end of each reporting period, the Company re-evaluates the probability of achievement of such milestones and any related constraints and, if necessary, adjusts the estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch up basis, which would affect revenue and net loss in the period of adjustment. |
Research and development (R&D) expenses | Research and development ( “ R&D ” ) expenses Research and development costs are expensed as incurred on an accruals basis in accordance with ASC Topic 730, Research and Development (“ASC 730”) because they have no alternative future uses. These expenses are comprised of the costs of the Company’s proprietary research and development efforts, including preclinical studies, clinical trials, manufacturing costs, employee salaries and benefits and share-based compensation expense, contract services including external research and development expenses incurred under arrangements with third parties such as contract research organizations (“CROs”), facilities costs, overhead costs and other related expenses. Intellectual property costs incurred on each drug candidate and costs associated with pre-commercial activities to support pricing and reimbursement by health technology assessment authorities and payor decision-makers in Europe are excluded from R&D expenses and are recognized within general and administrative expenses. Research and development costs that are paid in advance of performance are recorded as a prepaid expense and expensed over the service period as the services are provided. Accruals and prepayments for research and development expenses typically include fees and costs to be paid to CROs in relation to clinical trials and contract manufacturing organizations (“CMOs”) in relation to the manufacture of drug substance and drug product. These accruals and prepayments are calculated each period based on regular review and challenge by the relevant program manager of the detailed activity analysis provided directly by CROs and CMOs to determine their completeness and accuracy. |
Income taxes | Income taxes The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes (“ASC 740”), using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the consolidated financial statements or in its tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. The Company assesses the likelihood that deferred tax assets will be recovered in the future to the extent management believes, based upon the weight of available evidence, that it is more likely than not that all or a portion of the deferred tax assets will not be realized, a valuation allowance is established through a charge to income tax expense. Potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected and considering prudent and feasible tax planning strategies. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis. The Company accounts for uncertainty in income taxes by applying a two-step process to determine the amount of tax benefit to be recognized. First, the tax position is evaluated to determine the likelihood that it will be sustained upon external examination by the taxing authorities. If the tax position is deemed more-likely-than-not to be sustained, the tax position is then assessed as the amount of benefit to recognize in the consolidated financial statements. The amount of benefits that may be used is the largest amount that has a greater than 50% likelihood of being realized upon ultimate settlement. The provision for income taxes includes the effects of any resulting tax reserves, or unrecognized tax benefits, that are considered appropriate, as well as the related net interest and penalties. The Company recognizes interest related to unrecognized tax benefits within interest expense in the accompanying consolidated statements of operations and comprehensive loss. As of December 31, 2023 and 2022, no material accrued interest is included on the related tax liability line in the consolidated balance sheets. |
U.K R&D tax credit | U.K. R&D tax credit The Company is subject to corporate taxation in the U.K. Due to the nature of the business, the Company has generated operating losses since inception. The benefit from R&D tax credits is recognized in the consolidated statements of operations and comprehensive loss, and represents the research and development tax credits recoverable in the U.K. The U.K. R&D tax credit is fully refundable to the Company and is not dependent on current or future taxable income. As a result, the Company has recorded the entire benefit from the U.K. R&D tax credit as a benefit which is included in net loss before income tax and, accordingly, not reflected it as part of the income tax provision. If, in the future, any U.K. R&D tax credits generated are needed to offset a corporate income tax liability in the U.K., the relevant portion would be recorded as a benefit within the income tax provision and any refundable portion not dependent on taxable income would continue to be recorded within the benefit from research and development tax credit in the consolidated statement of operations and comprehensive loss. As a company that carries out extensive R&D activities, it benefits from the U.K. HM Revenue and Customs (“HMRC”) small and medium sized enterprises research and development relief, or SME R&D Relief, which provides relief against U.K. Corporation Tax and enables it to surrender some of its trading losses that arise from its research and development activities for a cash rebate. To date, a cash rebate of up to 33.35 % of eligible R&D expenditure has been available, but the cash rebate reduced to a maximum of 27 % for R&D intensive companies where at least 40 % of their total expenditure in on qualifying R&D, or to 18.6 % of eligible R&D expenditure for other companies, with effect from April 1, 2023 pursuant to changes made by the Finance Act 2023. Certain subcontracted qualifying research expenditures are eligible for a cash rebate though the rate of the cash rebate also reduced with effect from April 1, 2023, from up to 21.67 % of the subcontracted expenditures to 17.53 % for R&D intensive companies or 12.09 % for other companie s. The difference in cash rebate for qualifying subcontracted expenditure vs. other qualifying expenditure is due to a statutory restriction of 65 % being applied to unconnected qualifying subcontracted expenditure, thus restricting the benefit available. The Company may not be able to continue to claim payable R&D tax credits in the future because it may no longer qualify as a small or medium sized company. In that case, the Company would expect to benefit from the taxable credit for qualifying R&D expenditure under the R&D Expenditure Credit (RDEC) scheme available to large companies which may be either offset against corporation tax liabilities or paid net of tax as a cash credit where there is no liability in the future. Expenditure subcontracted to other companies is not however a qualifying cost under the RDEC scheme. Subcontracted expenditure however is in most cases not a qualifying cost under the current RDEC scheme but is expected to be a qualifying cost (unless it relates to non-qualifying costs subcontracted overseas) under the new merged RDEC scheme, that will come into force for accounting periods beginning on or after April 1, 2024. In the event the Company generates revenues in the future, it may also benefit from the U.K. “patent box” regime that allows profits attributable to revenues from patents or patented product candidates to be taxed at an effective rate of 10 %. This relief applies to profits earned following election into the regime. When taken in combination with the enhanced relief available on our R&D expenditures, the Company expects a long-term lower rate of corporation tax to apply to it. If, however, there are unexpected adverse changes to the U.K. R&D tax credit regime or the “patent box” regime, or for any reason it is unable to qualify for such advantageous tax legislation, or it is unable to use net operating loss and tax credit carryforwards and certain built-in losses to reduce future tax payments, the Company's business, results of operations, and financial condition may be adversely affected. In particular, HM Treasury and HMRC launched a consultation in January 2023 entitled “R&D Tax Reliefs Review, Consultation on a single scheme” which seeks views on the possible merger of the SME R&D Relief scheme and the RDEC scheme applicable to large companies, the outcome of which may be further changes to the reliefs available. If it is decided to merge the schemes, any new regime is expected to apply with effect from April 1, 2024. |
Foreign currencies | Foreign currencies The Company maintains its consolidated financial statements in its functional currency, which is pound sterling. This is also the functional currency of the wholly-owned subsidiaries which are consolidated, with the exception of Mereo BioPharma 5, which has U.S dollars as its functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet dates. Non-monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the date of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the consolidated statements of operations and comprehensive loss. For financial reporting purposes, the consolidated financial statements of the Company have been presented in U.S. dollars, the reporting currency. The financial statements of entities are translated from their functional currency into U.S. dollars as follows: assets and liabilities are translated at the exchange rates at the balance sheet dates, revenue, operating expenses and other income/ (expense), net are translated at the average exchange rates for the periods presented, and shareholders’ equity is translated at the prevailing historical exchange rates. Translation adjustments are not included in determining net loss but are included as a foreign exchange adjustment to other comprehensive income, a component of shareholders’ equity. |
Property and equipment | Property and equipment Property and equipment is stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of replacing part of the equipment if the recognition criteria are met. All other repair and maintenance costs are recognized in profit or loss as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Useful lives of various property and equipment are as follows: • Leasehold improvements shorter of lease term or ten years • Office equipment five years • IT equipment three years Property and equipment is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the consolidated statement of operations and comprehensive loss when the asset is derecognized. The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed annually and adjusted prospectively, if appropriate. |
Leases | Leases Leases are accounted for under ASC Topic 842, Leases (“ASC 842”). The Company only has operating leases. The Company assesses whether a contract is, or contains, a lease at inception of the contract. The Company recognizes a right-of-use (“ROU”) asset and a corresponding liability with respect to all lease arrangements in which it is a lessee. ROU assets and liabilities are recognized at the commencement date based on the present value of remaining lease payments. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. As the Company's leases do not provide an implicit rate, the Company determines the incremental borrowing rate in calculating the present value of lease payments. The ROU assets also include any lease payments made prior to commencement and are recorded net of any lease incentives received. The Company’s lease terms may include options to extend or terminate the lease. When it is reasonably certain the Company will exercise such options the term of the lease will be amended and the ROU asset and corresponding liability will be measured based on inclusion the option term. The Company accounts for lease and non-lease components separately. The non-lease components are service and maintenance charges and are accounted for separately. There are no variable lease costs associated with the current leases. Operating leases are included in right-of-use assets and in current and non-current operating lease liabilities on the Company's consolidated balance sheets. Lease expense for lease payments is considered operating lease costs and is recognized on a straight-line basis over the lease term. The lease terms for the underlying assets is as follows: • Right-of-use asset (building) six to nine years • Right-of-use asset (equipment) one to two years |
Intangible assets | Intangible assets Identifiable intangible assets within the scope of ASC 730 that are purchased from others for a particular research and development project outside of a business combination, and that have no alternative future uses are expensed as incurred. Intangible assets that have an alternative future use, or which are outside the scope of ASC 730, are accounted for under ASC Topic 350, Intangibles – Goodwill and Other (“ASC 350”) and are initially recorded at cost, which is the fair value of the consideration paid on the acquisition date. Consideration that is contingent on future events is included in the cost of the asset only when the contingency is resolved and the consideration is issued or becomes issuable. Assets that have been acquired in a business combination are initially recorded at fair value. Intangible assets are amortized over their estimated useful economic life from the date they are available for use and are recognized in general and administrative expenses. An intangible asset is derecognized on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset, are recognized in profit or loss when the asset is derecognized. |
Financial instruments | Financial instruments The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, certain accrued expenses, contingent consideration, warrant liabilities and the liability components of convertible loan notes and other financing arrangements. Cash, cash equivalents, accounts receivable, accounts payable and accrued expenses are initially recorded and subsequently measured at cost, which is considered to approximate their fair value due to the short-term nature of such financial instruments. The carrying value of warrant liabilities and convertible loan notes is explained in the sections below. |
Embedded derivatives | Embedded derivatives The Company reviews the terms of convertible loan notes and other hybrid financing arrangements to determine whether there are embedded derivative instruments, including conversion options that are required to be bifurcated and accounted for separately either as a derivative financial instrument or an equity instrument. Derivative financial instruments are initially measured at fair value, and then re-valued at each reporting date, with changes in the fair value reported in the consolidated statements of operations and comprehensive loss as a component of net income. The discount from face value of the liability component remaining from allocating some or all of the proceeds of the hybrid instrument to the derivative, together with the stated rate of interest on the instrument, is amortized over the life of the instrument through periodic charges to consolidated statements of operations and comprehensive loss, using the effective interest method. Embedded derivatives that are bifurcated and recognized as liability instruments are presented in a separate line in the balance sheets. Embedded derivative instruments that meet the criteria of equity instruments under ASC Topic 815-40, Contracts in Entity’s Own Equity ( Subtopic 815-40 ) are initially recognized within additional paid-in capital at an amount determined by allocating the proceeds between the debt and equity components based on their relative fair values. |
Convertible loan notes | Convertible loan notes Convertible loan notes are accounted for in accordance with ASC Topic 470-20, Debt with Conversion and Other Options as amended by ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) which the Company early adopted on January 1, 2021 on a fully retrospective basis. As described in Note 11, the Company issued two hybrid financial instruments in 2020; the Novartis Loan Note and the Private Placement Loan Notes, which both included multiple instruments, including convertible loan notes and warrants. For both hybrid financial instruments, pursuant to ASC Subtopic 470-20, the Company separately accounted for the liability component of the convertible loan notes, the embedded conversion option and the warrants. In the case of the Novartis Loan Note, both the conversion option and the warrants were separately accounted for as equity instruments upon issuance. The conversion option and warrants are accounted for as equity instruments as they met the requirements to be considered indexed to the Company's own shares under Subtopic 815-40. In the case of the Private Placement Loan Notes, both the conversion option and the warrants were initially separately accounted for as derivative instruments under ASC 815, however upon the passing of certain resolutions of the Company’s shareholders on June 30, 2020, the classification of the conversion option was reassessed and reclassified as an equity instrument. The warrants continued to be separately accounted for as derivative liabilities. Consideration received for hybrid financial instruments containing convertible debt is initially allocated to the fair value of separately recognized derivative instruments that will be subsequently remeasured at fair value under ASC 815, including the warrants issued with the Private Placement Loan Notes. The remaining consideration is allocated to the liability portion of the convertible loan notes and any other separately recognized equity instruments, such as the embedded conversion option, based on the relative fair value of each instrument. Where none of the embedded derivatives are required to be subsequently remeasured at fair value, including the Novartis Loan Note, the consideration is allocated to all elements based on the relative fair value of each instrument. As the conversion option in the Novartis Loan Note is classified as an equity instrument, it qualifies for the scope exception for contracts indexed to the Company's own equity and as such is allocated to additional paid-in capital and accounted for at the initial recognition amount. Changes to the terms of convertible loan notes are evaluated to determine whether they constitute an extinguishment or modification. Changes are accounted for as an extinguishment if: (a) they cause the present value of the cash flows under the terms of the new debt instrument to be at least 10% different from the present value of the remaining cash flows under the terms of the original instrument; or (b) they change the fair value of the embedded conversion option by more than 10% of the carrying amount of the original debt instrument immediately before the modification; or (c) they add a substantive conversion option or eliminate a conversion option that was substantive at the date of the modification or exchange. Where changes are extinguishments, the liability component is derecognized and new component recognized in the same way as described above on initial recognition. The difference between the carrying value of the original debt and the fair value of the new component will be recognized as an extinguishment gain or loss. In the current year no extinguishment gain or loss is recognized in the consolidated statements of operations and comprehensive loss. Where changes are modifications, the carrying value of the liability component is adjusted to the present value of the modified cash flows discounted at the original effective interest rate, net of identifiable transaction costs, with the difference recognized by accreting the new carrying value to its face value using a revised effective interest rate and the accretion recognized in interest income. If the conversion option had previously been classified as a financial liability, but had been reclassified to equity (as was the case with the Private Placement Loan Notes) the carrying value of the liability is also adjusted to reflect any increase (but not decrease) in the fair value of the embedded, un-separated, conversion option with a corresponding adjustment to additional paid-in capital. The revised carrying value is accreted to the value of the principal plus accrued interest payable at maturity using the new effective interest rate. Upon any conversion of the convertible loan notes in accordance with the conversion privileges provided in the terms of the instrument, the carrying value is adjusted for any unamortized capitalized transaction costs, which are recognized within interest expense. The carrying value is reduced by the cash consideration received and any excess or deficit after recognizing the nominal value of the ordinary shares issued is recognized within additional paid-in capital. |
Warrant liabilities | Warrant liabilities The Company issued warrants as part of a private placement transaction on June 30, 2020 and to its previous lenders pursuant to the terms of its loan facility in August 2017 and October 2018. The private placement warrants expired in June 2023. The warrants were classified as liabilities as they included provisions that could require cash settlement. The warrant instruments are recorded at fair value, with changes in the fair value recognized in the consolidated statements of operations and comprehensive loss as a component of net loss, where the terms of the warrant instruments allow for cashless exercise. |
Equity classified warrants | Equity classified warrants The Company has issued the following equity classified warrants: - Warrants issued in conjunction with the Novartis Loan Note in 2020. The value allocated to these warrants was recognized in equity at issuance as described above. - In October 2018, the Group entered into a funding agreement with The Alpha-1 Project (“TAP”), which provided for total payments of $ 0.4 million, of which the final installment of $ 0.1 million was received in May 2023. In exchange for funding, the Company issued warrants allowing TAP to subscribe for ordinary shares in the Company. Under the agreement, TAP is potentially entitled to receive a payment equivalent to the amounts received by Mereo (up to a maximum of $ 0.4 million) conditional on and within thirty days of the first regulatory approval for alvelestat . The agreement is accounted for as a compound instrument that includes both debt and equity components with the carrying value of each component established based on the relative fair value of each component. The amount allocated to the liability component is accreted back to the face value over the period to the earliest reasonable repayment date using the effective interest method. The amount allocated to the warrants was recognized in additional paid-in capital and is not subsequently remeasured. |
Fair value measurement | Fair value measurement The Company follows the guidance in ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”) which defines fair value and establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the consolidated financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: • Level 1 — quoted (unadjusted) market prices in active markets for identical assets or liabilities. • Level 2 — valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable. • Level 3 — valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable. For assets and liabilities that are recognized in the consolidated financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by reassessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. There were no transfers within the fair value hierarchy during the years ended December 31, 2023 and 2022. |
Cash and cash equivalents | Cash and cash equivalents Cash and cash equivalents in the consolidated balance sheets comprise cash at banks along with short-term deposits with a maturity of three months or less. |
Share-based compensation | Share-based compensation Employees (including executives) and non-executive directors of the Company receive remuneration in the form of share-based compensation, whereby employees and non-executive directors render services as consideration for equity instruments (equity settled transactions). Incentives in the form of ADSs are provided to employees and non-executive directors under various plans. In accordance with ASC Topic 718, Stock Compensation (“ASC 718”), the total amounts to be expensed for these incentives are expensed through the consolidated statements of operations and comprehensive loss and are measured based on the grant-date fair value of the awards and recognized over the period during which the employee or non-executive director is required to perform services in exchange for the award (generally the vesting period of the award). In accordance with ASC 718, the cancellation of share options is accounted for as an acceleration of the vesting period and therefore any amount unrecognized that would otherwise have been recorded in future accounting periods is recognized immediately. The Company has elected to recognize the effect of forfeitures on share-based compensation when they occur. Any differences in compensation recognized at the time of forfeiture are recorded as a cumulative adjustment in the period in which the forfeiture occurs. |
Treasury shares | Treasury shares The EBT holds ADSs as treasury shares to satisfy the exercise of options under the Company’s share-based incentive schemes. The EBT is a Jersey-based trust which was initially funded by a loan from the Company, which it utilized to purchase shares in sufficient quantity to fulfill the envisaged awards. In accordance with ASC Topic 505, Equity (“ASC 505”), these shares will be deducted from ordinary shares on the consolidated balance sheet at their nominal value. Shares held by the EBT are included in the consolidated balance sheets as a reduction in additional paid-in capital. |
Comprehensive income/ (loss) | Comprehensive income/(loss) Comprehensive income/(loss) includes net income/(loss) as well as other changes in shareholders’ equity that result from transactions and economic events other than those with shareholders. The Company records unrealized gains and losses related to foreign currency translation as a component of other comprehensive loss in the consolidated statements of operations and comprehensive loss. |
Ordinary shares | Ordinary shares Ordinary shares are classified in shareholders’ equity and represent issued share capital. |
Additional paid-in capital | Additional paid-in capital Additional paid-in capital is classified in shareholders’ equity and includes the difference between the price paid per share and the nominal value. The equity element of share-based compensation is also recognized in additional paid-in capital as are derivative instruments that meet the requirements for equity classification. Incremental costs incurred and directly attributable to the offering of equity securities are deducted from the related proceeds of the offering. The net amount is recorded as additional paid-in capital in the period when such shares are issued. Where such expenses are incurred prior to the offering, they are recorded in prepayments until the offering completes. Other costs incurred in such offerings are expensed as incurred and included in general and administrative expenses. |
Net income/ (loss) per share | Net income/(loss) per share Basic net income/(loss) per share is computed by dividing the net income/(loss) attributable to ordinary shareholders by the weighted-average number of ordinary shares outstanding for the reporting period without consideration for potentially dilutive securities. Net income/(loss) attributable to ordinary shareholders is computed as if all net income/(loss) for the period had been distributed. During periods in which the Company incurred a net loss, the Company allocates no net loss to participating securities because they do not have a contractual obligation to share in the net loss of the Company. The Company computes diluted net income/(loss) per ordinary share after giving consideration to all potentially dilutive ordinary equivalents, including share options outstanding during the period, except where the effect of such non-participating securities would be antidilutive. Diluted net income/(loss) per share is computed by dividing the net income/(loss) attributable to ordinary shareholders by the weighted average number of ordinary shares and dilutive ordinary share equivalents outstanding for the period, determined using the treasury stock and if-converted methods. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Property, Plant and Equipment, Useful Life | Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Useful lives of various property and equipment are as follows: • Leasehold improvements shorter of lease term or ten years • Office equipment five years • IT equipment three years |
Summary of Lease Terms for Underlying Assets | Lease expense for lease payments is considered operating lease costs and is recognized on a straight-line basis over the lease term. The lease terms for the underlying assets is as follows: • Right-of-use asset (building) six to nine years • Right-of-use asset (equipment) one to two years |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial assets and liabilities measured at fair value on a recurring basis | The following table summarizes the Company’s financial assets and liabilities measured at fair value on a recurring basis and classified under the appropriate level of the fair value hierarchy as described above: As at December 31, 2023 Total Level 1 Level 2 Level 3 ($'000) ($'000) ($'000) ($'000) Financial liabilities Warrant liabilities 412 — 412 — CVR liability — — — — As at December 31, 2022 Total Level 1 Level 2 Level 3 ($'000) ($'000) ($'000) ($'000) Financial liabilities Warrant liabilities 643 — 157 486 CVR liability — — — — There were no transfers between Level 1 and Level 2 during the years ended December 31, 2023 and 2022. |
Schedule of changes in material | The CVR liability was $nil throughout both 2022 and 2023. The following table presents the changes in material Level 3 items for the years ended December 31, 2023 and December 31, 2022. Warrant labilities ($'000) January 1, 2022 11,276 Change in fair value ( 9,607 ) Foreign exchange ( 1,026 ) December 31, 2022 $ 643 Change in fair value ( 245 ) Foreign exchange 14 December 31, 2023 $ 412 |
Schedule of Significant Unobservable Inputs used in Level 3 | The significant unobservable inputs used in the fair value measurements categorized within Level 3 of the fair value hierarchy, together with a quantitative sensitivity analysis as at December 31, 2023 and 2022 are as follows: Valuation technique Significant unobservable inputs Input range Sensitivity of the input to fair value Warrant liability related to the private placement warrants Black- Scholes model Expected volatility 2023: n/a 2022: 95.5 % The warrants expired in June 2023, therefore the fair value at December 31, 2023 was $nil CVR liability Discounted cash flow Ongoing uncertainty in the clinical development of the Navi product Total potential future payments relating to the contingent consideration liability on a gross, undiscounted basis are approximately $ 80 million. However, the agreement expires in April 2024. If none of the milestones are achieved, then no further payments will be required. Regulatory approval and commercialization risks Sensitivity of the input to fair value is primarily driven by uncertainty in the clinical development of the Navi product. Future potential payments under the CVR arrangement are contingent on i) future development milestones and ii) future sales of the Navi product, following regulatory approval and commercialization. In January 2020, the Company entered into the license agreement. Although pursuant to the license agreement the Company is entitled to additional payments of up to $ 302 million, there continues to be no expectation of any milestone or royalty payments under the license agreement before the CVR arrangement expires in April 2024. |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consisted of the following: December 31, 2023 2022 ($'000) ($'000) VAT receivable $ 599 $ 438 Prepaid research and development services 632 2,348 Other taxes receivable — 741 Insurance claim receivable 1,950 — Security deposits 615 485 Other prepaid expense and current assets 1,360 1,434 Total $ 5,156 $ 5,446 |
Property and equipment , net (T
Property and equipment , net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and equipment, net | Property and equipment, net consists of the following: Year ended December 31, 2023 2022 ($'000) ($'000) Leasehold improvements $ 710 $ 675 Office equipment 199 190 IT equipment 296 422 Property and equipment, at cost 1,205 1,287 Less: accumulated depreciation ( 800 ) ( 736 ) Property and equipment, net $ 405 $ 551 |
Schedule of Composition of Intangible Assets, Net | Intangible assets consists of the following: Year ended December 31, 2023 2022 ($'000) ($'000) License $ 1,485 $ — Less: accumulated amortization ( 396 ) — Intangible asset, net $ 1,089 $ — |
Intangible assets (Tables)
Intangible assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Schedule of Composition of Intangible Assets, Net | Intangible assets consists of the following: Year ended December 31, 2023 2022 ($'000) ($'000) License $ 1,485 $ — Less: accumulated amortization ( 396 ) — Intangible asset, net $ 1,089 $ — |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Schedule of Maturities of Operating lease liabilities | Year ended December 31, 2023 2022 ($'000) ($'000) Operating leases Weighted-average remaining contractual lease term (years) 2.50 3.50 Weighted average discount rate 10.0 % 10.0 % Year ended December 31, 2023 2022 ($'000) ($'000) Cash paid for amounts included in the measurement of lease Operating cash flows from operating leases $ 759 $ 1,153 |
Weighted Average Remaining Lease Term and Discount Rate | Year ended December 31, 2023 ($'000) Maturity analysis of the operating lease liabilities for the years ending December 31, 2024 $ 778 2025 778 2026 191 2027 — 2028 — Thereafter — Total undiscounted payments 1,747 Less: Present value discount ( 189 ) Lease liability $ 1,558 Lease liability - current $ 652 Lease liability - non current $ 906 |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other current liabilities | Other current liabilities consists of the following: December 31, 2023 2022 ($'000) ($'000) Social security and other taxes $ 280 $ 202 Tax payable — — Deferred consideration liability 711 — Other current liabilities 30 869 Total $ 1,021 $ 1,071 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued expenses | Accrued expenses consist of the following: December 31, 2023 2022 ($'000) ($'000) Accrued research and development costs $ 1,821 $ 2,336 Accrued legal fees 266 132 Accrued bonus 1,624 1,863 Accrued audit fees 671 382 Accrued professional fees 338 183 Accrued local taxes 382 — Other accrued expenses 365 540 Total $ 5,467 $ 5,436 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | The components of loss before income taxes are as follows: Year ended December 31, 2023 2022 ($'000) ($'000) United States $ 8,464 $ 19,934 United Kingdom 21,534 23,004 Total $ 29,998 $ 42,938 |
Schedule of Components of Income Tax Expense | The components of income tax expense are as follows: Year ended December 31, 2023 2022 ($'000) ($'000) Current tax expense United States $ ( 2 ) $ ( 2 ) United Kingdom 534 720 Total current tax expense/(credit) $ 532 $ 718 Deferred tax expense United States — — United Kingdom — — Total deferred tax expense $ — $ — Total income tax expense/(credit) $ 532 $ 718 |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the U.K statutory income tax rate to the effective tax rate is as follows: Year ended December 31, 2023 2022 (%) (%) Income tax using U.K. statutory rate 23.5 19.0 Effect of rate change on opening tax balances — — Effect of rate change on current and deferred taxes — — Permanent differences ( 5.4 ) ( 5.3 ) U.K. R&D tax credits ( 1.9 ) ( 1.4 ) Changes in deferred tax valuation allowance ( 15.7 ) ( 13.9 ) Foreign rate differential ( 0.7 ) 0.9 Adjustments in respect of prior years 1.9 1.8 Other 0.2 1.2 Effective tax rate for loss from continuing operations 1.77 1.8 |
Schedule of Deferred Tax Assets and Liabilities | Components of the Company’s deferred tax assets and liabilities are as follows: Year ended December 31, 2023 2022 ($'000) ($'000) Deferred tax assets: Operating losses carryforwards $ ( 110,604 ) $ ( 104,874 ) Property and equipment ( 17 ) ( 0 ) Intangible fixed assets ( 4,248 ) ( 7,281 ) Temporary differences trading 56 ( 53 ) Temporary differences non trading ( 7 ) ( 8 ) Loan relationships ( 553 ) ( 548 ) U.S. tax credits ( 79,024 ) ( 73,276 ) Section 174 R&E ( 4,437 ) ( 3,711 ) Share based compensation awards ( 7,487 ) ( 7,492 ) Others ( 23 ) Gross deferred tax asset ( 206,344 ) ( 197,243 ) Valuation allowance $ 206,344 $ 197,243 Net deferred tax assets $ — $ — Deferred tax liabilities: Depreciation $ 32 $ 218 Right-of-use assets — — Intangible assets — — Net deferred tax liabilities $ 32 $ 218 Total deferred tax, net $ ( 32 ) $ ( 218 ) |
Schedule of Movements in Deferred Tax Valuation Allowance | Movements in deferred tax valuation allowance: Year ended December 31, 2023 2022 ($'000) ($'000) Valuation allowance at January 1 $ 197,243 $ 182,723 Change in tax rates — — Increase/(decrease in valuation allowance) 9,101 14,520 Valuation allowance at December 31 $ 206,344 $ 197,243 |
Share Based Compensation (Table
Share Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Summary of Share Based Compensation | The charge for share based compensation arises solely in respect of awards made under these two active plans as follows: Year ended December 31, 2023 2022 ($'000) ($'000) 2019 EIP 4,064 3,888 2019 NED EIP 860 880 Total 4,924 4,768 |
Summary of Option Activity and Related Information | A summary of the Company’s Option activity and related information under the 2019 EIP for 2023 and 2022 is as follows; all outstanding Options are expected to vest: Number of Weighted Weighted Aggregate intrinsic At January 1, 2022 3,943,702 2.88 2.40 — Granted 4,126,400 1.38 3.09 — Forfeited ( 48,044 ) 3.97 3.09 — Expired ( 1,164,197 ) 1.83 1.58 — At December 31, 2022 6,857,861 2.15 1.83 1 Granted 4,874,300 1.03 0.92 — Forfeited ( 1,324,809 ) 1.42 1.27 — Expired ( 751,672 ) 2.82 2.35 — Exercised ( 60,519 ) 1.57 1.29 45 At December 31, 2023 9,595,161 1.63 1.41 8,122 Vested 3,425,209 2.27 1.91 1,463 Nonvested 6,169,952 1.27 1.13 6,670 |
Summary of Assumptions used in Black-Scholes Option Pricing Model | The fair value of each Option is estimated on the date of grant using the Black-Scholes option pricing model based on the following weighted average assumptions: 2023 2022 Market value of ADSs ($) 1.03 1.38 Risk-free interest rate (%) 3.48 % 1.83 % Expected life (years) 10.00 10.00 Expected volatility (%) 98.24 % 96.00 % Expected dividends — — |
Summary of Restricted Stock Unit Activity and Related Information | A summary of the Company’s RSU activity and related information under the 2019 EIP for 2023 is as follows. As at December 31, 2023 no RSUs were vested but all outstanding RSUs are expected to vest: Number of Weighted Aggregate intrinsic At December 31, 2022 — — — Granted 679,225 1.03 Forfeited ( 190,000 ) 1.01 At December 31, 2023 489,225 1.03 1,130 |
Summary of Performance Based Restricted Stock Unit (PSUs) Activity and Related Information | A summary of the Company’s PSU activity and related information under the 2019 EIP for 2023 is as follows. At December 31, 2023 no PSUs were vested. Number of Weighted Aggregate intrinsic At December 31, 2022 — — — Granted 1,543,150 0.61 — Forfeited ( 205,000 ) 0.61 — At December 31, 2023 1,338,150 0.61 3,091 |
Performance Based Restricted Stock Units [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Summary of Assumptions used in Black-Scholes Option Pricing Model | These awards were valued using a Monte Carlo model with the following key inputs: 2023 Market value of ADSs ($) 1.01 Risk-free interest rate (%) 4.14 % Expected life (years) 1.03 Expected volatility (%) 105.56 % Expected dividends — |
Employee Stock Option | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Summary of Option Activity and Related Information | A summary of the Company’s Option activity and related information under the 2019 NED EIP for 2023 and 2022 is as follows; all outstanding Options are expected to vest: Number of Weighted Weighted Aggregate intrinsic value ($'000) At December 31, 2021 421,791 2.90 2.44 — Granted 535,488 1.22 1.08 — Forfeited ( 42,192 ) 1.01 0.89 — At December 31, 2022 915,087 2.00 1.71 6 Granted 440,000 0.94 0.84 — At December 31, 2023 1,355,087 1.66 1.43 1,166 Vested 1,281,751 1.70 1.46 1,066 Nonvested 73,336 0.94 0.84 100 |
Summary of Assumptions used in Black-Scholes Option Pricing Model | The fair value of each Option is estimated on the date of grant using the Black-Scholes option pricing model based on the following weighted average assumptions: 2023 2022 Market value of ADSs ($) 0.94 1.22 Risk-free interest rate (%) 3.36 % 1.96 % Expected life (years) 10.00 10.00 Expected volatility (%) 97.94 % 96.00 % Expected dividends — — |
Deferred Restricted Stock Units [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Summary of Restricted Stock Unit Activity and Related Information | A summary of the Company’s DRSU activity and related information under the 2019 NED EIP for 2023 and 2022 is as follows. At December 31, 2023 all DRSUs are expected to vest: Number of Weighted Aggregate intrinsic value ($'000) At January 1, 2022 — — — Granted 348,044 1.11 — Forfeited — — — At December 31, 2022 348,044 1.11 261 Granted 482,214 0.94 — Issued ( 100,276 ) 1.02 At December 31, 2023 729,982 1.01 1,686 Vested 689,837 1.02 1,594 Non vested 40,145 0.94 93 |
Previous Share Option Plans [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Summary of Option Activity and Related Information | A summary of the awards still outstanding under these plans is as follows: Number of Weighted Weighted Aggregate intrinsic value ($'000) At December 31, 2021 1,924,331 10.45 9.39 — Expired ( 240,776 ) 16.31 11.04 — At December 31, 2022 1,683,555 9.63 9.15 — Expired ( 111,197 ) 15.94 8.11 — At December, 31, 2023 1,572,358 9.22 8.19 — |
Loss Per Share (Tables)
Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Number of Ordinary Shares Outstanding and The Effect of Dilutive Ordinary Share | Diluted loss per share is based on dividing the loss attributable for the year, adjusted for the effect of diluted ordinary shares, by ordinary share equivalents, which includes the weighted average number of ordinary shares outstanding and the effect of dilutive ordinary share equivalents. Year ended December 31, 2023 2022 ($'000, except per share amounts) ($'000, except per share amounts) Net loss $ ( 29,466 ) $ ( 42,220 ) Net loss per share - basic and diluted $ ( 0.04 ) $ ( 0.07 ) Weighted-average number of shares used in computing net loss per share - basic and diluted 659,453,921 603,196,403 |
Schedule of Potentially Dilutive Shares Were Not Included In The Calculation of Diluted Shares Outstanding. | Years ended December 31, 2023 2022 Stock options to purchase ordinary shares 54,751,240 38,864,740 Restricted stock units 2,446,125 — Performance stock units 6,690,750 — Convertible loan notes (as converted to ordinary shares) 15,657,825 17,010,137 Convertible loan notes - private placement (as converted to ordinary shares) — 41,048,784 Warrants to purchase ordinary shares (as converted to ordinary shares) 2,487,816 147,431,351 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Summary of Common Shares | Number of Cost At December 31, 2021 584,908,239 2,333 Issued during the year 40,020,280 145 At December 31, 2022 624,928,519 2,478 Issued during the year 48,367,095 186 Conversion of convertible loan notes 27,420,095 108 Vesting of deferred restricted stock units 501,380 3 At December 31,2023 701,217,089 2,775 |
Warrant Liability (Tables)
Warrant Liability (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Warrants and Rights Note Disclosure [Abstract] | |
Schedule on the Fair Value Change in Derivative Liabilities | December 31, 2023 2022 ($'000) ($'000) At January 1 $ 643 $ 11,276 Fair value changes during the year ( 245 ) ( 9,607 ) Foreign exchange 14 ( 1,026 ) At December 31 $ 412 $ 643 |
Shedule Of Weighted Average Inputs To The Models Used For The Fair Value Of Warrants Granted Explanatory | The following table lists the weighted average inputs to the models used for the fair value of warrants: December 31, 2023 2022 Expected volatility (%) 102 95 Risk-free interest rate (%) 3.36 3.99 Expected life of warrants (years) 5.2 0.5 Market price of ADS ($) 2.31 0.75 Model used Black-Scholes Black-Scholes |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies (Additional Information) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 08, 2018 | Dec. 31, 2023 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | |||
Accumulated deficit | $ (419,630) | $ (404,575) | |
Cash and cash equivalents | 57,421 | 68,182 | |
Property, plant and equipment | 100 | 100 | |
Accrued Interest | $ 0 | $ 0 | |
Eligible R&D expenditure percentage | 33.35% | ||
Reduced R&D expenditure percentage | 17.53% | ||
Cash rebate reduced | 27% | ||
Total expenditure percentage | 40% | ||
Expenditure percentage | 18.60% | ||
Statutory restriction percentage | 65% | ||
Cash rebate percentage | 21.67% | ||
Subcontracted expenditures Percentage | 12.09% | ||
Bespoke rate specific to the patent box regime | 10% | ||
Payment Received | $ 400 | ||
Total payments | 400 | ||
Final installment | $ 100 |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Schedule of useful lives of various property and equipment (Details) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Line Items] | |
Basis | straight-line method |
Leasehold improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 10 years |
Office equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
IT equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant Accounting Policies - Schedule of lease terms for the underlying assets (Details) | Dec. 31, 2023 |
Building | Maximum | |
Property, Plant and Equipment [Line Items] | |
Right-of-use asset | 9 years |
Building | Minimum | |
Property, Plant and Equipment [Line Items] | |
Right-of-use asset | 9 years |
Equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Right-of-use asset | 9 years |
Equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Right-of-use asset | 9 years |
Fair Value Measurement (Additio
Fair Value Measurement (Additional Information) (Details) - Contingent Value Rights - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Business Combination, Contingent Consideration, Liability | $ 80 | |
Liabilities Fair Value Disclosure | 0 | $ 0 |
Undiscounted [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Business Combination, Contingent Consideration, Liability | $ 80 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of financial assets and liabilities measured at fair value on a recurring basis (Details) - Fair Value, Recurring [Member] - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Contingent Value Rights | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Financial Liabilities Fair Value Disclosure, Total | $ 0 | $ 0 |
Warrants to purchase ordinary shares (as converted to ordinary shares) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Financial Liabilities Fair Value Disclosure, Total | 412 | 643 |
Level 1 | Contingent Value Rights | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Financial Liabilities Fair Value Disclosure, Total | 0 | 0 |
Level 1 | Warrants to purchase ordinary shares (as converted to ordinary shares) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Financial Liabilities Fair Value Disclosure, Total | 412 | 157 |
Level 2 | Contingent Value Rights | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Financial Liabilities Fair Value Disclosure, Total | 0 | 0 |
Level 2 | Warrants to purchase ordinary shares (as converted to ordinary shares) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Financial Liabilities Fair Value Disclosure, Total | 0 | 0 |
Level 3 | Contingent Value Rights | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Financial Liabilities Fair Value Disclosure, Total | 0 | 0 |
Level 3 | Warrants to purchase ordinary shares (as converted to ordinary shares) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Financial Liabilities Fair Value Disclosure, Total | $ 0 | $ 486 |
Fair Value Measurement - Schedu
Fair Value Measurement - Schedule of Changes in Material (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Beginning for the period | $ 24,375 | |
Foreign exchange | (13,579) | $ (46,634) |
Foreign exchange | (2,347) | 2,723 |
Ending for the period | 9,486 | 24,375 |
Warrant [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Change in fair value | 245 | (9,607) |
Foreign exchange | 14 | (1,026) |
Contingent Consideration [Member] | Warrant [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Beginning for the period | 643 | 11,276 |
Ending for the period | $ 412 | $ 643 |
Fair Value Measurement - Sche_2
Fair Value Measurement - Schedule of Significant Unobservable Inputs Used in Level 3 (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Contingent Value Rights | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Future payments relating to the contingent consideration liability | $ 80 | |
Contingent Value Rights | License Agreement | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Royalty income | $ 302 | |
Private Placement Warrants | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Warrant liability related to the private placement warrants Input Range | 95.50% |
Prepaid expenses and other cu_3
Prepaid expenses and other current assets - Schedule of Prepaid Expenses And Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
VAT receivable | $ 599 | $ 438 |
Prepaid research and development services | 632 | 2,348 |
Other taxes receivable | 0 | 741 |
Insurance claim receivable | 1,950 | 0 |
Security deposits | 615 | 485 |
Other prepaid expense and current assets | 1,360 | 1,434 |
Total | $ 5,156 | $ 5,446 |
Property and equipment , net -
Property and equipment , net - Summary of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, at cost | $ 1,205 | $ 1,287 |
Less: accumulated depreciation | (800) | (736) |
Property and equipment, net | 405 | 551 |
Leasehold improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, at cost | 710 | 675 |
Office equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, at cost | 199 | 190 |
IT Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, at cost | $ 296 | $ 422 |
Property and equipment , net _2
Property and equipment , net - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Depreciation | $ 171 | $ 181 |
Intangible assets - Summary of
Intangible assets - Summary of Intangible assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Less: accumulated amortization | $ (396) | $ 0 |
Intangible Assets, Net (Excluding Goodwill), Total | 1,089 | 0 |
License | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets | $ 1,485 | $ 0 |
Intangible assets (Additional I
Intangible assets (Additional Information) (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible assets acquired | $ 1.5 |
Deferred Liabilities, Total | $ 1.5 |
Leases (Additional Information)
Leases (Additional Information) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 25, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | |||
Lease Expiration Date | Jun. 30, 2026 | ||
Operating Lease, Payments | $ 759 | $ 1,153 | |
Operating Costs and Expenses, Total | 700 | 900 | |
Material variable lease costs | 0 | ||
Operating right of use assets recognized | 1,245 | 1,665 | |
Amortization of operating lease right-of-use assets | $ 495 | $ 708 | |
Lease period extension | |||
Finite-Lived Intangible Assets [Line Items] | |||
Lease Expiration Date | Jun. 30, 2026 |
Leases - Schedule of Maturities
Leases - Schedule of Maturities of Operating lease liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
2024 | $ 778 | |
2025 | 778 | |
2026 | 191 | |
2027 | 0 | |
2028 | 0 | |
Thereafter | 0 | |
Total undiscounted payments | 1,747 | |
Less: Present value discount | (189) | |
Lease Liability | 1,558 | |
Lease liability - current | 652 | $ 564 |
Lease liability - non current | $ 906 | $ 1,479 |
Leases - Weighted Average Remai
Leases - Weighted Average Remaining Lease Term and Discount Rate (Details) | Dec. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Weighted-average remaining contractual lease term (years) | 2 years 6 months | 3 years 6 months |
Weighted average discount rate | 10% | 10% |
Leases - Cash paid for lease li
Leases - Cash paid for lease liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Leases [Abstract] | ||
Operating cash flows from operating leases | $ 759 | $ 1,153 |
Other current liabilities - Sch
Other current liabilities - Schedule of Other current liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Other Liabilities Disclosure [Abstract] | ||
Social security and other taxes | $ 280 | $ 202 |
Tax payable | 0 | 0 |
Deferred consideration liability | 711 | 0 |
Other current liabilities | 30 | 869 |
Total | $ 1,021 | $ 1,071 |
Accrued expenses - Schedule of
Accrued expenses - Schedule of Accrued expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | ||
Accrued research and development costs | $ 1,821 | $ 2,336 |
Accrued legal fees | 266 | 132 |
Accrued bonus | 1,624 | 1,863 |
Accrued audit fees | 671 | 382 |
Accrued professional fees | 338 | 183 |
Accrued local taxes | 382 | 0 |
Other accrued expenses | 365 | 540 |
Total | $ 5,467 | $ 5,436 |
Convertible Loan Notes (Additio
Convertible Loan Notes (Additional Information) (Details) £ / shares in Units, $ / shares in Units, £ in Millions, $ in Millions | 1 Months Ended | 12 Months Ended | |||||||||||
Feb. 10, 2023 USD ($) shares | Feb. 10, 2020 GBP (£) £ / shares shares | Jul. 31, 2023 USD ($) $ / shares shares | May 31, 2023 USD ($) $ / shares shares | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) shares | Dec. 31, 2020 USD ($) | Dec. 31, 2023 £ / shares | Aug. 31, 2023 USD ($) | Dec. 31, 2022 £ / shares | Jan. 01, 2022 GBP (£) £ / shares | Jan. 01, 2022 USD ($) | Feb. 10, 2020 USD ($) $ / shares shares | |
Debt Instrument [Line Items] | |||||||||||||
Share Issued, Price per Share | £ / shares | £ 0.174 | ||||||||||||
Private Placement Loan Notes [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Conversion Price Per Share | £ / shares | £ 0.174 | ||||||||||||
Ordinary Shares [Member] | Novartis Pharma [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Exercise Price of Warrants Issued | (per share) | £ 0.265 | $ 0.36 | |||||||||||
Novartis Loan Note [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt Instrument, Interest Rate | 6% | 6% | |||||||||||
Carrying Value of Debt Instrument | $ 4.6 | $ 5.7 | |||||||||||
Fair value of convertible debt | $ 3.1 | $ 3.7 | |||||||||||
Debt Instrument, Effective Interest Rate | 27.80% | 37.40% | |||||||||||
Novartis Loan Note [Member] | Novartis Pharma [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Amount of Convertible Note | £ 3.8 | $ 5.2 | |||||||||||
Conversion Price Per Share | (per share) | £ 0.265 | $ 0.36 | |||||||||||
Debt Instrument, Maturity Date | Feb. 10, 2023 | ||||||||||||
Warrants Convertible in Equity | shares | 1,449,614 | 1,449,614 | |||||||||||
Debt Instrument, Extended Maturity Date | Feb. 10, 2025 | ||||||||||||
Debt Instrument, Amended Interest Rate | 9% | ||||||||||||
Debt Instrument, Amended Accrued Interest | $ 0.9 | ||||||||||||
Novartis Loan Note [Member] | Ordinary Shares [Member] | Novartis Pharma [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Warrants Convertible in Equity | shares | 2,000,000 | ||||||||||||
New Novartis Loan Note [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Carrying Value of Debt Instrument | $ 5.5 | ||||||||||||
Debt Instrument, Consideration, Liability Recognised Two | 4.2 | ||||||||||||
Debt Instrument, Interest Paid in Cash | 0.8 | ||||||||||||
Relative Fair value of the Warrants and The Conversion Option | 0.5 | ||||||||||||
Gain (Loss) on Extinguishment of Debt | $ 0 | ||||||||||||
Debt, Interest Expense | $ 1 | $ 1.5 | |||||||||||
Convertible Debt Instrument [Member] | Private Placement Loan Notes [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt Instrument, Interest Rate | 6% | 6% | |||||||||||
Debt Instrument, Maturity Date | Jun. 03, 2023 | ||||||||||||
Debt Instrument, Extended Maturity Date | Aug. 03, 2023 | ||||||||||||
Carrying Value of Debt Instrument | 8.4 | ||||||||||||
Fair value of convertible debt | 5.7 | ||||||||||||
Debt Instrument, Interest Paid in Cash | $ 0.2 | ||||||||||||
Debt, Interest Expense | $ 1.6 | ||||||||||||
Debt Instrument, Effective Interest Rate | 27.10% | 25.10% | |||||||||||
Debt Instrument, Aggregate Principal Amount | $ 4.6 | $ 4.6 | $ 7.5 | £ 12.4 | $ 9.2 | ||||||||
Issuance of Private Placement Loan Notes | $ 70 | ||||||||||||
Changes in Carrying Value of Debt Instrument | $ 0.6 | ||||||||||||
Payment of Debt Outstanding Amount | $ 3.2 | ||||||||||||
Debt Instrument, Unamortized Debt Discount and Issuance Costs | $ 0.1 | ||||||||||||
Convertible Debt Instrument [Member] | Ordinary Shares [Member] | Private Placement Loan Notes [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Conversion Price Per Share | £ / shares | £ 0.174 | ||||||||||||
Debt Instrument,Conversion, Shares Issued | shares | 9,645,200 | 17,774,895 | 40,020,280 | ||||||||||
Share Issued, Price per Share | (per share) | $ 0.174 | $ 0.174 | £ 0.174 |
Warrant liability - Summary of
Warrant liability - Summary of change in fair value of the warrant liability (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Warrants and Rights Note Disclosure [Abstract] | ||
At January 1 | $ 643 | $ 11,276 |
Fair Value Changes during The Year | (245) | (9,607) |
Foreign Exchange | (14) | (1,026) |
At December 31 | $ 412 | $ 643 |
Warrant liability - Summary o_2
Warrant liability - Summary of weighted average inputs to the models used for the fair value of warrants (Details) - Warrant Liability - $ / shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Class of Warrant or Right [Line Items] | ||
Expected volatility (%) | 102% | 95% |
Risk-free interest rate (%) | 3.36% | 3.99% |
Expected life of warrants (years) | 5 years 2 months 12 days | 6 months |
Market price of ADS ($) | $ 2.31 | $ 0.75 |
Model used | Black-Scholes | Black-Scholes |
Warrant Liability (Additional I
Warrant Liability (Additional Information) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Jun. 30, 2023 | Dec. 31, 2021 | Jun. 30, 2020 | |
Class of Warrant or Right [Line Items] | |||||
Warrant Liability | $ 412 | $ 643 | $ 11,276 | ||
Fair Value Of Warrant Liability | $ 500 | ||||
Percentage of issued share capital | 0.40% | 24% | |||
Warrant Member | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants Outstanding | 2,487,816 | 147,431,351 | |||
Private Placement Warrants | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants Issued | 161,048,366 | ||||
Exercise Price Per Warrants | $ 0.443 | $ 0.348 | |||
Adjustments Of Warrants Fair Value | $ 500 | ||||
Warrants Exercised During Period | 0 | ||||
Bank Loan | |||||
Class of Warrant or Right [Line Items] | |||||
Warrant Liability | $ 400 | $ 200 | |||
Adjustments Of Warrants Fair Value | $ 300 | ||||
Bank Loan | Ordinary Shares [Member] | Two Thousand And Twenty Warrants | |||||
Class of Warrant or Right [Line Items] | |||||
Exercise Price Per Warrants | $ 0.4144 | ||||
Number Of Securities Called By Warrants | 1,243,908 | ||||
Bank Loan | Ordinary Shares [Member] | Warrants Subscribed | |||||
Class of Warrant or Right [Line Items] | |||||
Exercise Price Per Warrants | $ 2.95 | $ 3.76 | |||
Number Of Securities Called By Warrants | 1,243,908 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of Common Shares (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Cost | ||
Beginning balance, value | $ 51,402 | $ 92,198 |
Vesting of deferred restricted stock units | 3 | |
Ending balance, value | $ 50,537 | $ 51,402 |
Common Shares | ||
Number of ordinary shares | ||
Beginning balance, shares | 624,928,519 | 584,908,239 |
Issued during the year, shares | 48,367,095 | 40,020,280 |
Conversion of convertible loan notes, shares | 27,420,095 | |
Vesting of deferred restricted stock units, shares | 501,380 | |
Common Stock, Shares, Outstanding, Ending Balance | 701,217,089 | 624,928,519 |
Cost | ||
Beginning balance, value | $ 2,478 | $ 2,333 |
Issued during the period | 186 | 145 |
Conversion of convertible loan notes | 108 | |
Vesting of deferred restricted stock units | 3 | |
Ending balance, value | $ 2,775 | $ 2,478 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Jul. 31, 2023 USD ($) shares | Dec. 31, 2023 USD ($) shares | Dec. 31, 2022 USD ($) shares | Dec. 31, 2023 £ / shares | Dec. 31, 2023 USD ($) shares | Dec. 31, 2022 £ / shares shares | |
Ordinary stock, shares issued | 701,217,089 | 624,928,519 | ||||
Ordinary stock, par value | £ / shares | £ 0.003 | £ 0.003 | ||||
Ordinary shares price per share | £ / shares | £ 0.174 | |||||
Aggregate gross proceeds | $ | $ 11,605 | $ 0 | ||||
Vesting of equity awards | 501,380 | |||||
Private Placement Loan Notes [Member] | ||||||
Ordinary stock, shares issued | 27,420,095 | |||||
Convertible debt security, carrying value | $ | $ 7,500 | |||||
Conversion Price Per Share | £ / shares | £ 0.174 | |||||
At-the-market | ||||||
Ordinary stock, shares issued | 48,367,095 | |||||
ADSs outstanding | 9,673,419 | |||||
Aggregate gross proceeds | $ | $ 12,000 | |||||
Common Shares | ||||||
Conversion of convertible loan notes, shares | 27,420,095 | |||||
Issued during the year, shares | 48,367,095 | 40,020,280 |
Revenue and Cost of revenue (Ad
Revenue and Cost of revenue (Additional Information) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 13, 2023 | Jan. 25, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Other current liabilities | $ 1,021 | $ 1,071 | |||
Revenue | 10,000 | 0 | |||
Ultragenyx Partnership | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Revenue from contract with customers excluding assessed tax | $ 50,000 | ||||
Contingent milestone payment receivable | 254,000 | ||||
Cost of revenue | 1,100 | ||||
Revenue | 0 | ||||
Milestone payment Recived | $ 50,000 | ||||
ReproNovo Partnership | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Revenue from contract with customers excluding assessed tax | $ 1,000 | 1,000 | |||
Contingent milestone payment receivable | 64,300 | ||||
Revenue | $ 0 | ||||
Milestone payment Recived | $ 1,000 | 1,000 | |||
Collaboration And Licensing Agreement | Ultragenyx Partnership | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Revenue from contract with customers excluding assessed tax | 9,000 | ||||
Milestone payment Recived | 9,000 | ||||
2015 asset purchase agreement under the collaboration and license agreement with Ultragenyx | Ultragenyx Partnership | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Payment obligation | $ 13,300 | ||||
Revenue from contract with customers excluding assessed tax | 50,000 | ||||
Cost of revenue | 2,400 | 13,300 | |||
Milestone payment to ultragenyx collaboration agreement deductions costs | 3,300 | ||||
Other current liabilities | 10,000 | ||||
Milestone payment Recived | $ 50,000 | ||||
2015 asset purchase agreement under the collaboration and license agreement with Ultragenyx | ReproNovo Partnership | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Accrued milestone payment current | $ 100 |
Other income_(expenses) , net (
Other income/(expenses) , net (Additional Information) (Details) - Mereo Bio Pharma [Member] $ in Millions | 1 Months Ended |
Feb. 28, 2022 USD ($) | |
Restructuring Cost and Reserve [Line Items] | |
Mentmilestone payment received | $ 2 |
Deferred Considerations Liability Current | 0.9 |
Other Income Net | $ 1.1 |
Income Taxes (Additional Inform
Income Taxes (Additional Information) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Apr. 01, 2023 | Dec. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Operating Loss Carryforwards [Line Items] | ||||
Uncertain tax position | $ 2.9 | $ 2.9 | ||
Research & Development Tax Losses for Alternative Minimum Tax | 20% | 20% | ||
Accumulated Tax Losses Carried Forward | $ 18.2 | |||
Pre-acquisition loss carryforward limit | $ 0.3 | |||
United Kingdom | ||||
Operating Loss Carryforwards [Line Items] | ||||
Income Tax Rate | 1.77% | 1.80% | ||
Enacted Statutory Rate | 19% | 25% | ||
Deferred Tax Assets and Liabilities, Measured Rate | 25% | |||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 23.50% | 19% | ||
Operating Loss Carryforwards | $ 30.6 | $ 30.6 | $ 28.7 | |
Applicable Tax Rate | 23.52% | 19% | ||
United States | ||||
Operating Loss Carryforwards [Line Items] | ||||
Deferred Tax Assets and Liabilities, Measured Rate | 21% | |||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21% | |||
Federal Tax Authority [Member] | United States | ||||
Operating Loss Carryforwards [Line Items] | ||||
Operating Loss Carryforwards | 66.2 | $ 66.2 | ||
Tax Losses carry forward | $ 65.2 | |||
Federal Tax Authority [Member] | Research and Development Tax Credit Carryforward [Member] | United States | ||||
Operating Loss Carryforwards [Line Items] | ||||
Tax Credit Carryforward, Amount | 14 | 14 | 14 | |
Federal Tax Authority [Member] | Indefinitely Expired [Member] | United States | ||||
Operating Loss Carryforwards [Line Items] | ||||
Tax Losses carry forward | 18.2 | 17.2 | ||
Federal Tax Authority [Member] | Expire In 2023 [Member] | United States | ||||
Operating Loss Carryforwards [Line Items] | ||||
Tax Losses carry forward | 48 | |||
Federal Tax Authority [Member] | Expire In 2024 [Member] | United States | ||||
Operating Loss Carryforwards [Line Items] | ||||
Tax Losses carry forward | 48 | |||
State and Local Jurisdiction Tax Authority [Member] | United States | Maximum [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Tax Losses carry forward | 0.1 | 0.1 | ||
State and Local Jurisdiction Tax Authority [Member] | Research and Development Tax Credit Carryforward [Member] | United States | ||||
Operating Loss Carryforwards [Line Items] | ||||
Tax Credit Carryforward, Amount | $ 0.1 | $ 0.1 | $ 0.1 |
Income Taxes - Summary of Compo
Income Taxes - Summary of Components of Loss before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Operating Loss Carryforwards [Line Items] | ||
Income before Income Taxes | $ 29,998 | $ 42,938 |
United States | ||
Operating Loss Carryforwards [Line Items] | ||
Income before Income Taxes | 8,464 | 19,934 |
United Kingdom | ||
Operating Loss Carryforwards [Line Items] | ||
Income before Income Taxes | $ 21,534 | $ 23,004 |
Income Taxes - Summary of Com_2
Income Taxes - Summary of Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Operating Loss Carryforwards [Line Items] | ||
Total current tax expense/(credit) | $ 532 | $ 718 |
Total deferred tax expense | 0 | 0 |
Total income tax expense/(credit) | 532 | 718 |
United States | ||
Operating Loss Carryforwards [Line Items] | ||
Total current tax expense/(credit) | (2) | (2) |
Total deferred tax expense | 0 | 0 |
United Kingdom | ||
Operating Loss Carryforwards [Line Items] | ||
Total current tax expense/(credit) | 534 | 720 |
Total deferred tax expense | $ 0 | $ 0 |
Income Taxes - Summary of Recon
Income Taxes - Summary of Reconciliation of U.K Statutory Income Tax Rate to Effective Tax Rate (Details) - United Kingdom | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Operating Loss Carryforwards [Line Items] | ||
Income tax using U.K. statutory rate | 23.50% | 19% |
Effect of rate change on opening tax balances | 0% | 0% |
Effect of rate change on current and deferred taxes | 0% | 0% |
Permanent differences | (5.40%) | (5.30%) |
U.K. R&D tax credits | (1.90%) | (1.40%) |
Changes in deferred tax valuation allowance | (15.70%) | (13.90%) |
Foreign rate differential | (0.70%) | 0.90% |
Adjustments in respect of prior years | 1.90% | 1.80% |
Other | 0.20% | 1.20% |
Effective tax rate for income from continuing operations | 1.77% | 1.80% |
Income Taxes - Summary of Com_3
Income Taxes - Summary of Components of the Company's Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | |||
Operating losses carryforwards | $ (110,604) | $ (104,874) | |
Property and equipment | 17 | 0 | |
Intangible fixed assets | (4,248) | (7,281) | |
Temporary differences trading | 56 | (53) | |
Temporary differences non trading | (7) | (8) | |
Loan relationships | (553) | (548) | |
US tax credits | (79,024) | (73,276) | |
Section 174 R&E | (4,437) | (3,711) | |
Share based compensation awards | (7,487) | (7,492) | |
Others | (23) | ||
Gross deferred tax asset | (206,344) | (197,243) | |
Valuation allowance | 206,344 | 197,243 | $ 182,723 |
Net deferred tax assets | 0 | 0 | |
Deferred tax liabilities: | |||
Depreciation | 32 | 218 | |
Right-of-use assets | 0 | 0 | |
Intangible assets | 0 | 0 | |
Net deferred tax liabilities | 32 | 218 | |
Total deferred tax, net | $ (32) | $ (218) |
Income Taxes - Summary of Movem
Income Taxes - Summary of Movements in Deferred Tax Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Valuation allowance at January 1 | $ 197,243 | $ 182,723 |
Change in tax rates | 0 | 0 |
Increase/(decrease in valuation allowance) | 9,101 | 14,520 |
Valuation allowance at December 31 | $ 206,344 | $ 197,243 |
Share based compensation (Addit
Share based compensation (Additional Information) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Unrecognized compensation cost | $ 2.9 | |
Weighted Average Recognition Term | 1 year 7 months 6 days | |
2019 Equity Incentive Plan [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Number of shares authorized | 4,700,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested Options Forfeited, Weighted Average Grant Date Fair Value | $ 1.13 | |
Weighted average per share fair value of options, Vesting | $ 1.91 | |
2019 Equity Incentive Plan [Member] | Options Vesting [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Share options, Contractual term | 10 years | |
Number of options, Nonvested | 4,775,834 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested Options Forfeited, Weighted Average Grant Date Fair Value | $ 1.57 | |
Weighted average per share fair value of options, Vesting | $ 1.55 | $ 2.45 |
Weighted average contractual life of options, Outstanding | 8 years 1 month 6 days | 7 years 10 months 24 days |
Weighted average contractual life of options, Vested | 7 years 1 month 6 days | 6 years 2 months 12 days |
2019 Non-Executive Director Equity Incentive Plan [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested Options Forfeited, Weighted Average Grant Date Fair Value | $ 0.84 | |
Weighted average per share fair value of options, Vesting | $ 1.46 | |
2019 Non-Executive Director Equity Incentive Plan [Member] | Options Vesting [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Share options, Contractual term | 10 years | |
Number of options, Nonvested | 82,503 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested Options Forfeited, Weighted Average Grant Date Fair Value | $ 1.01 | |
Weighted average per share fair value of options, Vesting | $ 1.38 | $ 1.78 |
Weighted average contractual life of options, Outstanding | 8 years | 8 years 6 months |
Weighted average contractual life of options, Vested | 7 years 10 months 24 days | 8 years 4 months 24 days |
Previous Share Option Plans [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Weighted average contractual life of options, Outstanding | 1 year 9 months 18 days | 2 years 4 months 24 days |
Weighted average contractual life of options, Vested | 1 year 9 months 18 days | 2 years 4 months 24 days |
Performance Based Restricted Stock Units [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Weighted average contractual life of options, Outstanding | 1 year 1 month 6 days | |
Restricted Stock Units [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Weighted average contractual life of options, Outstanding | 2 years 1 month 6 days | |
Restricted Stock Units [Member] | Maximum [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Weighted average contractual life of options, Outstanding | 3 years | |
Deferred Restricted Stock Units [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested Options Forfeited, Weighted Average Grant Date Fair Value | $ 0.94 | |
Weighted average per share fair value of options, Vesting | $ 1.02 | |
Deferred Restricted Stock Units [Member] | Minimum [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Exercisable term | 180 days |
Share based compensation - Summ
Share based compensation - Summary of Share Based Compensation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Total | $ 4,924 | $ 4,768 |
2019 EIP | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Total | 4,064 | 3,888 |
2019 NED EIP | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Total | $ 860 | $ 880 |
Share based compensation - Su_2
Share based compensation - Summary of Option Activity and Related Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
2019 Non-Executive Director Equity Incentive Plan [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Number of options, Begining Balance | 915,087 | 421,791 |
Granted | 440,000 | 535,488 |
Forfeited | (42,192) | |
Number of options, Ending Balance | 1,355,087 | 915,087 |
Vested | 1,281,751 | |
Nonvested | 73,336 | |
Weighted Average Exercise Price, Beginning Balance | $ 2 | $ 2.9 |
Granted | 0.94 | 1.22 |
Forfeited | 1.01 | |
Vested | $ 1.7 | |
Nonvested | 0.94 | |
Weighted Average Exercise Price, Ending Balance | $ 1.66 | 2 |
Weighted Average Grant Date Fair Value, Beginning Balance | 1.71 | 2.44 |
Granted | 0.84 | 1.08 |
Vesting | 1.46 | |
Forfeited | 0.89 | |
Nonvested | 0.84 | |
Weighted Average Grant Date Fair Value, Ending Balance | $ 1.43 | $ 1.71 |
Aggregate intrinsic value Beginning | $ 6,000 | $ 0 |
Vested | 1,066,000 | |
Nonvested | $ 100,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested Options Forfeited, Number of Shares | 73,336 | |
Share-Based Compensation Arrangement by Share Based Payment Award, Options Nonvested Weighted Average Exercise Price | 0.94 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested Options Forfeited, Weighted Average Grant Date Fair Value | $ 0.84 | |
Share Based Compensation Arrangement by Share Based Payment Award Equity Instruments Options Aggregate Intrinsic Value Nonvested | $ 100,000 | |
Aggregate intrinsic value Ending | $ 1,166,000 | $ 6,000 |
2019 Equity Incentive Plan [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Number of options, Begining Balance | 6,857,861 | 3,943,702 |
Granted | 4,874,300 | 4,126,400 |
Forfeited | (1,324,809) | (48,044) |
Expired | (751,672) | (1,164,197) |
Exercised | (60,519) | |
Number of options, Ending Balance | 9,595,161 | 6,857,861 |
Vested | 3,425,209 | |
Nonvested | 6,169,952 | |
Weighted Average Exercise Price, Beginning Balance | $ 2.15 | $ 2.88 |
Granted | 1.03 | 1.38 |
Exercised | 1.57 | |
Forfeited | 1.42 | 3.97 |
Expired | 2.82 | 1.83 |
Vested | $ 2.27 | |
Nonvested | 1.27 | |
Weighted Average Exercise Price, Ending Balance | $ 1.63 | 2.15 |
Weighted Average Grant Date Fair Value, Beginning Balance | 1.83 | 2.4 |
Granted | 0.92 | 3.09 |
Vesting | 1.91 | |
Forfeited | 1.27 | 3.09 |
Nonvested | 1.13 | |
Expired | 2.35 | 1.58 |
Exercised | 1.29 | |
Weighted Average Grant Date Fair Value, Ending Balance | $ 1.41 | $ 1.83 |
Aggregate intrinsic value Beginning | $ 1,000 | $ 0 |
Exercised | 45,000 | |
Vested | 1,463,000 | |
Nonvested | $ 6,670,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested Options Forfeited, Number of Shares | 6,169,952 | |
Share-Based Compensation Arrangement by Share Based Payment Award, Options Nonvested Weighted Average Exercise Price | 1.27 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested Options Forfeited, Weighted Average Grant Date Fair Value | $ 1.13 | |
Share Based Compensation Arrangement by Share Based Payment Award Equity Instruments Options Aggregate Intrinsic Value Nonvested | $ 6,670,000 | |
Aggregate intrinsic value Ending | $ 8,122,000 | $ 1,000 |
Previous Share Option Plans [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Number of options, Begining Balance | 1,683,555 | 1,924,331 |
Expired | (111,197) | (240,776) |
Number of options, Ending Balance | 1,572,358 | 1,683,555 |
Weighted Average Exercise Price, Beginning Balance | $ 9.63 | $ 10.45 |
Expired | 15.94 | 16.31 |
Weighted Average Exercise Price, Ending Balance | 9.22 | 9.63 |
Weighted Average Grant Date Fair Value, Beginning Balance | 9.15 | 9.39 |
Expired | 8.11 | 11.04 |
Weighted Average Grant Date Fair Value, Ending Balance | $ 8.19 | $ 9.15 |
Aggregate intrinsic value Beginning | $ 0 | $ 0 |
Aggregate intrinsic value Ending | $ 0 | $ 0 |
Share based compensation - Su_3
Share based compensation - Summary of Assumptions used in Black-Scholes Option Pricing Model (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Performance Shares [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Market value of ADSs | $ 1.01 | |
Risk-free interest rate (%) | 4.14% | |
Expected life (years) | 1 year 10 days | |
Expected volatility (%) | 105.56% | |
Expected dividends | $ 0 | |
Share-Based Payment Arrangement [Member] | 2019 Equity Incentive Plan [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Market value of ADSs | $ 1.03 | $ 1.38 |
Risk-free interest rate (%) | 3.48% | 1.83% |
Expected life (years) | 10 years | 10 years |
Expected volatility (%) | 98.24% | 96% |
Expected dividends | $ 0 | $ 0 |
Share-Based Payment Arrangement [Member] | 2019 Non-Executive Director Equity Incentive Plan [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Market value of ADSs | $ 0.94 | $ 1.22 |
Risk-free interest rate (%) | 3.36% | 1.96% |
Expected life (years) | 10 years | 10 years |
Expected volatility (%) | 97.94% | 96% |
Expected dividends | $ 0 | $ 0 |
Share based compensation - Su_4
Share based compensation - Summary of Restricted Stock Unit Activity and Related Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Restricted Stock Units [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Number of RSUs, Beginning Balance | 0 | |
Granted | 679,225 | |
Forfeited | (190,000) | |
Number of RSUs, Ending Balance | 489,225 | 0 |
Weighted Average Grant Date Fair Value, Beginning Balance | $ 0 | |
Granted | 1.03 | |
Forfeited | 1.01 | |
Weighted Average Grant Date Fair Value, Ending Balance | $ 1.03 | $ 0 |
Aggregate intrinsic value, Beginning Balance | $ 0 | |
Aggregate intrinsic value, Ending Balance | $ 1,130 | $ 0 |
Deferred Restricted Stock Units [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Number of RSUs, Beginning Balance | 348,044 | 0 |
Granted | 482,214 | 348,044 |
Exercised | 100,276 | |
Forfeited | 0 | |
Number of RSUs, Ending Balance | 729,982 | 348,044 |
Weighted Average Grant Date Fair Value, Beginning Balance | $ 1.11 | $ 0 |
Granted | 0.94 | 1.11 |
Forfeited | 0 | |
ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsGrantsInPeriodWeightedAverageExercisedDateFairValue | 1.02 | |
Weighted Average Grant Date Fair Value, Ending Balance | $ 1.01 | $ 1.11 |
Aggregate intrinsic value, Beginning Balance | $ 261 | $ 0 |
Vested | 1,594 | |
Share Based Compensation Arrangement by Share Based Payment Award Equity Instruments Options Aggregate Intrinsic Value Nonvested | $ 93 | |
Weighted average per share fair value of options, Vesting | $ 1.02 | |
Nonvested | $ 0.94 | |
Vested | 689,837 | |
Nonvested | 40,145 | |
Aggregate intrinsic value, Ending Balance | $ 1,686 | $ 261 |
Share based compensation - Su_5
Share based compensation - Summary of Performance Based Restricted Stock Unit (PSUs) Activity and Related Information (Details) - Performance Based Restricted Stock Units [Member] $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of RSUs, Beginning Balance | shares | 0 |
Granted | shares | 1,543,150 |
Forfeited | shares | (205,000) |
Number of RSUs, Ending Balance | shares | 1,338,150 |
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares | $ 0 |
Granted | $ / shares | 0.61 |
Forfeited | $ / shares | 0.61 |
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares | $ 0.61 |
Aggregate intrinsic value, Beginning Balance | $ | $ 0 |
Granted | $ | 0 |
Forfeited | $ | 0 |
Aggregate intrinsic value, Ending Balance | $ | $ 3,091 |
Loss per share - Schedule of We
Loss per share - Schedule of Weighted Average Number of Ordinary Shares Outstanding and The Effect of Dilutive Ordinary Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Net loss | $ (29,466) | $ (42,220) |
Net loss per share - basic | $ (0.04) | $ (0.07) |
Net loss per share - diluted | $ (0.04) | $ (0.07) |
Weighted average shares outstanding - basic | 659,453,921 | 603,196,403 |
Weighted average shares outstanding - diluted | 659,453,921 | 603,196,403 |
Loss per share - Schedule of Po
Loss per share - Schedule of Potentially Dilutive Shares Were Not Included In The Calculation of Diluted Shares Outstanding (Details) - shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Performance stock units [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 6,690,750 | 0 |
Stock options to purchase ordinary shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 54,751,240 | 38,864,740 |
Restricted Stock Units [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,446,125 | 0 |
Convertible loan notes (as converted to ordinary shares) | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 15,657,825 | 17,010,137 |
Convertible loan notes (as converted to ordinary shares) | Private Placement Loan Notes [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 41,048,784 |
Warrants to purchase ordinary shares (as converted to ordinary shares) | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,487,816 | 147,431,351 |
Commitments and contingencies (
Commitments and contingencies (Additional Information) (Details) - USD ($) $ in Millions | 1 Months Ended | ||
Oct. 31, 2017 | Dec. 31, 2023 | Dec. 31, 2022 | |
AstraZeneca [Member] | |||
Loss Contingencies [Line Items] | |||
Asset acquisition | $ 5 | ||
AstraZeneca [Member] | License Agreement [Member] | |||
Loss Contingencies [Line Items] | |||
Asset acquisition | $ 3 | ||
Shares issued for upfront payment | 490,798 | ||
Maximum | AstraZeneca [Member] | |||
Loss Contingencies [Line Items] | |||
Maximum amount | $ 115.5 | ||
CMOs [Member] | |||
Loss Contingencies [Line Items] | |||
Manufacturing commitments | $ 4.2 | $ 1.1 |
Related Party Disclosures (Addi
Related Party Disclosures (Additional Information) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Related Party Transactions [Abstract] | ||
Related Party Transaction | $ 0 | $ 0 |