Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 28, 2020 | Jun. 28, 2019 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | RCUS | ||
Entity Registrant Name | Arcus Biosciences, Inc. | ||
Entity Central Index Key | 0001724521 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Shell Company | false | ||
Entity File Number | 001-38419 | ||
Entity Tax Identification Number | 47-3898435 | ||
Entity Address, Address Line One | 3928 Point Eden Way | ||
Entity Address, City or Town | Hayward | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94545 | ||
City Area Code | 510 | ||
Local Phone Number | 694-6200 | ||
Entity Interactive Data Current | Yes | ||
Title of 12(b) Security | Common Stock, Par Value $0.0001 Per Share | ||
Security Exchange Name | NYSE | ||
Entity Incorporation, State or Country Code | DE | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Common Stock, Shares Outstanding | 45,974,189 | ||
Entity Public Float | $ 297,967,057 | ||
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE Portions of the Registrant’s Definitive Proxy Statement relating to the 2020 Annual Meeting of Shareholders, scheduled to be held on June 4, 2020, are incorporated by reference into Part III of this Report. The Definitive Proxy Statement will be filed within 120 days of the Registrant’s fiscal year ended December 31, 2019. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 57,937 | $ 71,064 |
Short-term investments | 130,333 | 185,480 |
Receivable from collaboration partner | 132 | |
Prepaid expenses and other current assets | 4,303 | 2,321 |
Amounts owed by a related party | 83 | |
Total current assets | 192,705 | 258,948 |
Long-term investments | 3,181 | |
Property and equipment, net | 9,330 | 11,107 |
Equity investment in related party | 1,202 | |
Restricted cash | 203 | 203 |
Other long-term assets | 872 | 284 |
Total assets | 203,110 | 274,925 |
Current liabilities: | ||
Accounts payable | 4,704 | 3,102 |
Accrued liabilities | 9,522 | 6,023 |
Deferred revenue, current | 7,000 | 6,250 |
Other current liabilities | 1,480 | 1,560 |
Total current liabilities | 22,706 | 16,935 |
Deferred revenue, noncurrent | 12,022 | 16,984 |
Deferred rent | 3,734 | 4,272 |
Other long-term liabilities | 806 | 1,792 |
Total liabilities | 39,268 | 39,983 |
Commitments (Note 11) | ||
Stockholders’ equity: | ||
Preferred stock, $0.0001 par value, 10,000,000 shares authorized as of December 31, 2019 and 2018; no shares issued and outstanding as of December 31, 2019 and 2018 | 0 | 0 |
Common stock, $0.0001 par value, 400,000,000 shares authorized as of December 31, 2019 and 2018; 45,925,004 and 44,537,946 shares issued and outstanding as of December 31, 2019 and 2018, respectively | 4 | 4 |
Additional paid-in capital | 369,100 | 357,873 |
Accumulated deficit | (205,326) | (122,828) |
Accumulated other comprehensive income (loss) | 64 | (107) |
Total stockholders’ equity | 163,842 | 234,942 |
Total liabilities and stockholders’ equity | $ 203,110 | $ 274,925 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares issued | 45,925,004 | 44,537,946 |
Common stock, shares outstanding | 45,925,004 | 44,537,946 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | ||
Collaboration and license revenue | $ 15,000 | $ 8,353 |
Type of Revenue [Extensible List] | us-gaap:LicenseAndServiceMember | us-gaap:LicenseAndServiceMember |
Operating expenses: | ||
Research and development | $ 78,481 | $ 49,646 |
General and administrative | 25,228 | 13,566 |
Total operating expenses | 103,709 | 63,212 |
Loss from operations | (88,709) | (54,859) |
Non-operating income (expense): | ||
Interest and other income, net | 5,201 | 4,922 |
Gain on deemed sale from equity method investee | 0 | 1,229 |
Share of loss from equity method investee | (1,202) | (886) |
Total non-operating income, net | 3,999 | 5,265 |
Net loss | (84,710) | (49,594) |
Other comprehensive income (loss) | 171 | (65) |
Comprehensive loss | $ (84,539) | $ (49,659) |
Net loss per share, basic and diluted | $ (1.93) | $ (1.43) |
Weighted-average number of shares used to compute basic and diluted net loss per share | 43,825,991 | 34,618,237 |
Consolidated Statements of Conv
Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Convertible Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) |
Balance at Dec. 31, 2017 | $ (72,328) | $ 948 | $ (73,234) | $ (42) | ||
Balance, shares at Dec. 31, 2017 | 30,459,574 | |||||
Balance at Dec. 31, 2017 | $ 226,196 | |||||
Balance, shares at Dec. 31, 2017 | 3,278,129 | |||||
Conversion of preferred stock to common stock | 226,198 | $ 3 | 226,195 | |||
Conversion of preferred stock to common stock, shares | (30,459,574) | |||||
Conversion of preferred stock to common stock | $ (226,196) | |||||
Conversion of preferred stock to common stock, shares | 30,459,574 | |||||
Issuance of common stock upon IPO | 124,735 | $ 1 | 124,734 | |||
Issuance of common stock upon IPO, shares | 9,200,000 | |||||
Issuance of common stock upon exercise of stock options, net of amounts related to unvested shares | 95 | 95 | ||||
Issuance of common stock upon exercise of stock options, net of amounts related to unvested shares, shares | 67,349 | |||||
Vesting of early exercised stock options and restricted stock | 1,276 | 1,276 | ||||
Vesting of early exercised stock options and restricted stock, shares | 528,374 | |||||
Issuance of common stock under Employee Stock Purchase Plan | 751 | 751 | ||||
Issuance of common stock under Employee Stock Purchase Plan, shares | 77,397 | |||||
Stock-based compensation | 3,874 | 3,874 | ||||
Other comprehensive income (loss) | (65) | (65) | ||||
Net loss | (49,594) | (49,594) | ||||
Balance at Dec. 31, 2018 | $ 234,942 | $ 4 | 357,873 | (122,828) | (107) | |
Balance, shares at Dec. 31, 2018 | 0 | |||||
Balance, shares at Dec. 31, 2018 | 44,537,946 | 43,610,823 | ||||
Cumulative effect adjustment upon adoption of ASC 606 | ASC 606 | $ 2,212 | 2,212 | ||||
Issuance of common stock upon exercise of stock options, net of amounts related to unvested shares | $ 188 | 188 | ||||
Issuance of common stock upon exercise of stock options, net of amounts related to unvested shares, shares | 41,762 | 34,780 | ||||
Vesting of early exercised stock options and restricted stock | $ 1,029 | 1,029 | ||||
Vesting of early exercised stock options and restricted stock, shares | 417,883 | |||||
Issuance of common stock under Employee Stock Purchase Plan | 1,029 | 1,029 | ||||
Issuance of common stock under Employee Stock Purchase Plan, shares | 148,709 | |||||
Stock-based compensation | 8,981 | 8,981 | ||||
Other comprehensive income (loss) | 171 | 171 | ||||
Net loss | (84,710) | (84,710) | ||||
Balance at Dec. 31, 2019 | $ 163,842 | $ 4 | $ 369,100 | $ (205,326) | $ 64 | |
Balance, shares at Dec. 31, 2019 | 0 | |||||
Balance, shares at Dec. 31, 2019 | 45,925,004 | 44,212,195 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flow from operating activities | ||
Net loss | $ (84,710) | $ (49,594) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation expense | 8,981 | 3,874 |
Depreciation and amortization | 3,578 | 3,664 |
Share of loss from equity method investee | 1,202 | 886 |
Gain on deemed sale from equity method investee | 0 | (1,229) |
Amortization of premiums on investments | (2,638) | (1,752) |
Other non-operating income | 0 | (177) |
Changes in operating assets and liabilities: | ||
Receivable from collaboration partner | (132) | 0 |
Amounts owed by a related party | 83 | (58) |
Prepaid expenses and other current assets | (1,982) | (1,180) |
Other long-term assets | (588) | (80) |
Accounts payable | 1,726 | (69) |
Accrued liabilities | 3,499 | 3,497 |
Other current liabilities | 57 | 43 |
Deferred revenue | (2,000) | (353) |
Deferred rent | (538) | (468) |
Net cash used in operating activities | (73,462) | (42,996) |
Cash flow from investing activities | ||
Purchases of short-term and long-term investments | (247,755) | (261,552) |
Proceeds from maturities of short-term and long-term investments | 308,892 | 151,855 |
Purchases of property and equipment | (1,925) | (3,743) |
Net cash provided by (used in) investing activities | 59,212 | (113,440) |
Cash flow from financing activities | ||
Proceeds from initial public offering, net of issuance costs | 0 | 125,111 |
Proceeds from issuance of common stock | 1,217 | 4,098 |
Repurchase of common stock issued under early exercised options | (94) | 0 |
Payment of preferred stock issuance costs | 0 | (135) |
Net cash provided by financing activities | 1,123 | 129,074 |
Net decrease in cash, cash equivalents and restricted cash | (13,127) | (27,362) |
Cash, cash equivalents and restricted cash at beginning of period | 71,267 | 98,629 |
Cash, cash equivalents and restricted cash at end of period | 58,140 | 71,267 |
Non-cash investing and financing activities: | ||
Unpaid portion of property and equipment purchases included in accounts payable and accrued liabilities | 12 | 136 |
Vesting of early exercised stock options and restricted stock | $ 1,029 | $ 1,276 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization | Note 1. Organization Description of Business Arcus Biosciences, Inc. (the Company) is a clinical-stage biopharmaceutical company focused on creating best-in-class cancer therapies. The Company’s initial focus has been on well-characterized biological pathways with significant scientific data supporting their importance. Since its inception in 2015, the Company has built a robust and highly efficient discovery capability to create highly differentiated small molecules, which the Company is developing in combination with its in-licensed monoclonal antibodies through rationally designed, indication-specific, adaptive clinical trial designs. Initial Public Offering On March 21, 2018, the Company completed its initial public offering (IPO) pursuant to which the Company issued 9,200,000 shares of common stock, including the exercise of the underwriters’ overallotment option to purchase 1,200,000 shares of common stock, at an offering price at $15.00 per share. The Company received aggregate net proceeds of approximately $124.7 million after deducting underwriting discounts and other offering related costs. In addition, in connection with the completion of the Company’s IPO, all outstanding shares of convertible preferred stock were converted into 30,459,574 shares of common stock, and the Company amended and restated its certificate of incorporation and bylaws, which, among other things, changed the authorized capital stock to 400,000,000 shares of common stock and 10,000,000 shares of preferred stock, each with a par value of $0.0001 per share. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Basis of Presentation The consolidated financial statements and accompanying notes have been prepared in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP) and include all adjustments necessary for the fair presentation of the Company’s financial position for the periods presented. Principles of Consolidation During 2017, the Company established a wholly-owned subsidiary in Australia. During 2019, the Company established a wholly-owned subsidiary in Ireland. The consolidated financial statements include the Company’s accounts and those of its wholly-owned subsidiaries. All intercompany accounts, transactions and balances have been eliminated. Reverse Stock Split On March 9, 2018, the Company effected a reverse split of all shares of its common and preferred stock at a ratio of 1-for-3.96 The par values and the authorized shares of the common and preferred stock were not adjusted as a result of the Reverse Split. All references to shares of common stock outstanding, average number of shares outstanding and per share amounts in these consolidated financial statements and notes to the consolidated financial statements have been adjusted within the consolidated financial statements, on a retroactive basis, to reflect the Reverse Split Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as related disclosure of contingent assets and liabilities. Estimates are used to determine stock-based awards and other issuances, accruals for research and development costs, useful lives of long-lived assets, and uncertain tax positions. Actual results could differ materially from the Company’s estimates. Risk and Uncertainties The Company’s future results of operations involve a number of risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, uncertainty of clinical trial results and achievement of milestones, uncertainty of regulatory approval of the Company’s potential drug candidates, uncertainty of market acceptance of the Company’s product candidates, competition from substitute products and larger companies, securing and protecting proprietary technology, strategic relationships and dependence on key individuals and sole source suppliers. The Company’s investigational products require approval from the U.S. Food and Drug Administration (FDA) and comparable foreign regulatory agencies prior to commercial sales in their respective jurisdictions. There can be no assurance that any investigational products will receive the necessary approvals. If the Company does not obtain regulatory approval and does not successfully commercialize any of its investigational products, it would have a materially adverse impact on the Company. Segments The Company operates and manages its business as one reportable and operating segment, which is the business of developing and commercializing cancer therapies. The Company’s chief executive officer, who is the chief operating decision maker, reviews financial information on an aggregate basis for purposes of allocating and evaluating financial performance. All long-lived assets are maintained in the United States of America. Cash Equivalents, Short-Term and Long-Term Investments Cash equivalents consist of marketable securities having an original maturity of three months or less at the time of purchase. Short-term investments have maturities of greater than three months and less than twelve months at the time of purchase. Long-term investments have maturities greater than 12 months at the time of purchase. Collectively, cash equivalents, short-term and long-term investments are considered available-for-sale and are recorded at fair value. Unrealized gains and losses are recorded in accumulated other comprehensive loss. Realized gains and losses are included in interest and other income, net in the consolidated statements of operations and comprehensive loss. The basis on which the cost of a security sold or amount reclassified out of accumulated other comprehensive income into earnings is determined using the specific identification method. Restricted Cash Restricted cash at December 31, 2019 and 2018 comprises cash balances primarily held as security in connection with the Company’s facility lease agreement and is included in long-term assets in the consolidated balance sheets. Receivable from a Related Party Receivable from a related party is recorded net of any allowances. As of December 31, 2018, the outstanding amount was due from PACT Pharma, Inc. (PACT Pharma) for expenses the Company paid on its behalf. The receivable was fully paid in 2019. Fair Value Measurements Fair value accounting is applied for all financial assets and liabilities, including short-term and long-term investments, and non-financial assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis (at least annually). The carrying amount of the Company’s financial instruments, including receivable from a related party, accounts payable and accrued expenses and other current liabilities approximate fair value due to their short-term maturities. Concentration of Credit Risk Cash equivalents, short-term and long-term investments are financial instruments that potentially subject the Company to concentrations of credit risk. The Company invests in money market funds, treasury bills and notes, government bonds, commercial paper and corporate notes. The Company limits its credit risk associated with cash equivalents, short-term and long-term investments by placing them with banks and institutions it believes are highly credit worthy and in highly rated investments. Property and Equipment Property and equipment are stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets, ranging from one to five years. Leasehold improvements are amortized over the shorter of their estimated useful lives or the related lease term. Upon retirement or sale, the cost and related accumulated depreciation are removed from the consolidated balance sheet and the resulting gain or loss is reflected in the consolidated statement of operations and comprehensive loss. Impairment of Long-Lived Assets The Company reviews long-lived assets, including property and equipment, for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. An impairment charge would be recorded when estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition are less than its carrying amount. Impairment, if any, is assessed using discounted cash flows or other appropriate measures of fair value. The Company did not recognize any impairment charges for the years ended December 31, 2019 and 2018. Revenue Recognition At the inception of an arrangement, the Company evaluates if a counterparty to a contract is a customer, if the arrangement is within the scope of revenue from contracts with customers guidance, and the term of the contract. The Company recognizes revenue when its customer obtains control of promised goods or services in a contract for an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. For contracts with customers, the Company performs The estimation of the stand-alone selling price may include such estimates as forecasted revenues or costs, development timelines, discount rates, and probabilities of technical and regulatory success. The Company evaluates each performance obligation to determine if they can be satisfied at a point in time or over time, and the Company measures the services delivered to the customer, which are periodically reviewed based on the progress of the related program. The effect of any change made to an estimated input component and, therefore revenue or expense recognized, would be recorded as a change in estimate. In addition, variable consideration (e.g. milestone payments) must be evaluated to determine if it is constrained and, therefore, excluded from the transaction price. Upfront Research and Development Fee s: The Company identifies the performance obligations associated with the upfront research and development fees and determines if any of the promised services are distinct from each other. If a promised service is determined to be distinct, then the Company allocates the transaction price amongst the promised services based on its best judgment of their estimated stand-alone selling prices. If the promised services are not distinct, then all of the services are bundled together, and the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time. If the performance obligation is considered to be satisfied over time, the Company selects the revenue recognition method that it believes most faithfully depicts the Company’s performance in transferring control of the services. The Company may choose between two methods to measure progress toward complete satisfaction of a performance obligation over time: input methods or output methods. Input methods recognize revenue on the basis of the entity’s efforts or inputs to the satisfaction of a performance obligation (e.g., resources consumed, labor hours expended, costs incurred, or time elapsed) relative to the total expected inputs to the satisfaction of that performance obligation. Output methods recognize revenue on the basis of direct measurements of the value to the customer of the goods or services transferred to date relative to the remaining goods or services promised under the contract (e.g. surveys of performance completed to date, appraisals of results achieved, milestones reached, time elapsed, and units produced or units delivered). The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Option Fees: At the inception of each arrangement that includes option exercise fees to obtain development and commercialization licenses for the Company’s products, the Company determines whether or not such option fee is considered a material right. If the option is considered a material right, then that option is considered a separate performance obligation in the contract and the transaction price includes the option fee in the allocation amongst the performance obligations. If the option is not considered a material right, then the option is accounted for as a separate contract. Milestone Payments: For arrangements that include development milestone payments, the Company consider the milestone payments to be variable consideration under ASC 606 at the inception of the arrangement, evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company’s or the licensee’s control, such as regulatory approvals, are not considered probable of being earned until the uncertainty associated with the approvals has been resolved. The transaction price is then allocated to each performance obligation, on a relative standalone selling price basis, which the Company recognizes as revenue when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of earning such development milestones and any related constraint, 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 earnings in the period of adjustment. Royalties: For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). Upfront payments and fees are recorded as deferred revenue when due and payable and may require deferral of revenue recognition to a future period until the Company performs its obligations under these arrangements. Amounts payable to the Company are recorded as accounts receivable when the Company’s right to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less. Research and Development Expenses Research and development costs are expensed as incurred. Research and development expenses consist primarily of personnel costs for the Company’s research and development employees, costs incurred to third-party service providers for the conduct of research, preclinical and clinical studies, laboratory supplies and equipment maintenance costs, product license fees, consulting and other related expenses. Also included are non-personnel costs such as professional fees payable to third parties for preclinical and clinical studies and research services, laboratory supplies and equipment maintenance, product licenses, and other consulting costs. The Company estimates research, preclinical and clinical study expenses based on services performed, pursuant to contracts with third-party research and development organizations that conduct and manage research, preclinical and clinical activities on its behalf. The Company estimates these expenses based on discussions with internal management personnel and external service providers as to the progress or stage of completion of services and the contracted fees to be paid for such services. If the actual timing of the performance of services or the level of effort varies from the original estimates, the Company will adjust the accrual accordingly. Payments associated with licensing agreements to acquire licenses to develop, use, manufacture and commercialize products that have not reached technological feasibility and do not have alternative future use are expensed as incurred. Payments made to third parties under these arrangements in advance of the performance of the related services by the third parties are recorded as prepaid expenses until the services are rendered. Leases and Rent Expense The Company records rent expense on a straight-line basis over the life of the lease. In cases where there is a free rent period or future fixed rent escalations, the Company records a deferred rent liability. Additionally, the receipt of any lease incentives is recorded as a deferred rent liability which is amortized over the lease term as a reduction of rent expense. Any lease incentives that are due from the landlord but have not been collected are recorded as a receivable in Prepaid expenses and other current assets. Building improvements that are made with lease incentives or tenant allowances are capitalized as leasehold improvements and included in property and equipment in the consolidated balance sheets. Stock-Based Compensation The Company accounts for stock-based compensation arrangements in accordance with ASC 718, Stock Compensation Equity Based Payments to Non-Employees No. 2018-07 (Topic 718), Compensation – Stock Compensation, Stock-based awards granted include stock options with time-based vesting. ASC 718 requires the recognition of compensation expense, using a fair value-based method, for costs related to all stock-based payments. The Company’s determination of the fair value of stock options with time-based vesting on the date of grant utilizes the Black-Scholes option-pricing model, and is impacted by the Company’s common stock price as well as other variables including, but not limited to, expected term that options will remain outstanding, expected common stock price volatility over the term of the option awards, risk-free interest rates and expected dividends. The fair value of a stock-based award is recognized over the period during which an optionee is required to provide services in exchange for the option award, known as the requisite service period (usually the vesting period) on a straight-line basis. Stock-based compensation expense is recognized based on the fair value determined on the date of grant and is reduced for forfeitures as they occur. Estimating the fair value of equity-settled awards as of the grant date using valuation models, such as the Black-Scholes option pricing model, is affected by assumptions regarding a number of complex variables. Changes in the assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require significant analysis and judgment to develop. Convertible Preferred Stock The Company records all shares of convertible preferred stock at their respective fair values less issuance costs on the dates of issuance. The convertible preferred stock is recorded outside of stockholders’ equity (deficit) because, in the event of certain deemed liquidation events considered not solely within the Company’s control, such as a merger, acquisition and sale of all or substantially all of the Company’s assets, the convertible preferred stock will become redeemable at the option of the holders. In the event of a change of control of the Company, proceeds received from the sale of such shares will be distributed in accordance with the liquidation preferences set forth in the Company’s Amended and Restated Certificate of Incorporation unless the holders of convertible preferred stock have converted their shares of convertible preferred stock into shares of common stock. The Company has determined not to adjust the carrying values of the convertible preferred stock to the liquidation preferences of such shares because of the uncertainty of whether or when such an event would occur. All outstanding convertible preferred stock converted into common stock in March 2018 upon the effectiveness of the IPO. Income Taxes The Company provides for income taxes under the asset and liability method. Current income tax expense or benefit represents the amount of income taxes expected to be payable or refundable for the current year. Deferred income tax assets and liabilities are determined based on differences between the financial statement reporting and tax bases of assets and liabilities and net operating loss and credit carryforwards, and are measured using the enacted tax rates and laws that will be in effect when such items are expected to reverse. Deferred income tax assets are reduced, as necessary, by a valuation allowance when management determines it is more likely than not that some or all of the tax benefits will not be realized. The Company accounts for uncertain tax positions in accordance with ASC 740-10, Accounting for Uncertainty in Income Taxes. The Company includes any penalties and interest expense related to income taxes as a component of other expense and interest income, net, as necessary. Comprehensive Income (Loss) Comprehensive loss includes net loss and net unrealized income and losses on available-for-sale securities, which are presented in a single continuous statement. Other comprehensive income (loss) is also disclosed in the consolidated balance sheets and statements of stockholders’ equity in accumulated other comprehensive income (loss), and is stated net of related tax effects, if any. Net Loss per Share Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common shares and potentially dilutive securities outstanding for the period. The Company excludes the weighted-average shares subject to repurchase from its calculation of weighted average of common shares outstanding. For purposes of the diluted net loss per share calculation, outstanding common stock options are considered to be potentially dilutive securities. Because the Company reported a net loss for the years ended December 31, 2019 and 2018, and the inclusion of the potentially dilutive securities would be antidilutive, diluted net loss per share is the same as basic net loss per share for all periods. Adopted Accounting Pronouncements – Revenue Recognition Effective January 1, 2019, the Company adopted Accounting Standards Codification Topic 606, Revenue from Contracts with Customers Impact of Adoption – ASC 606 The Company entered into a license and collaboration agreement (the Taiho Agreement) in September 2017, an agreement that is within the scope of ASC 606, under which it has provided Taiho Pharmaceutical Co., Ltd (Taiho) exclusive options, over a five-year period (the Option Period) to obtain an exclusive development and commercialization license to clinical stage product candidates from the Company’s programs. The terms of the arrangement include non-refundable upfront research and development fees, option fees to obtain development and commercialization licenses for the Company’s products, milestone payments based on achievement of defined development, regulatory and sales targets, and royalties on sales of commercialized product. The Company has applied the five-step model of the new standard to the Taiho Agreement, the only Company contract that has been impacted by the adoption of the new revenue standards. The Company implemented the new revenue standard using the modified retrospective transition method. Results for the year ended December 31, 2019 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with the Company’s historic accounting under previous revenue recognition guidance, Accounting Standards Codification Topic 605: Revenue Recognition (Topic 605). Upon the adoption, the Company recorded a net reduction of $2.2 million to its opening accumulated deficit as of January 1, 2019, due to the cumulative impact of adopting Topic 606, with the impact primarily relating to an increase in the transaction price recognized for the non-refundable upfront research and development fees over the five-year term. The impact of the adoption of Topic 606 on contract liabilities and accumulated deficit balances as of January 1, 2019 was as follows (in thousands): December 31, 2018 Adjustment Due to the Adoption of Topic 606 January 1, 2019 Current portion of deferred revenue $ 6,250 $ 750 $ 7,000 Long-term portion of deferred revenue 16,984 (2,962 ) 14,022 Accumulated deficit $ (122,828 ) $ 2,212 $ (120,616 ) The adjustments due to the adoption of Topic 606 primarily relate to an increase in the transaction price recognized for the non-refundable upfront research and development fees over the five-year term. Under Topic 606, the Company recognizes revenue based on the transaction price of $35.0 million, representing the total amount that the Company expects to receive related to the non-refundable upfront fees. As of December 31, 2019, the Company had received the full $35.0 million in upfront fees, which consisted of payments of $25.0 million in 2017 at the inception of the contract and anniversary payments of $5.0 million in 2018 and 2019. Under Topic 605, the $25.0 The impact of the adoption of Topic 606 on the Company’s Consolidated Balance Sheet and Statement of Operations as of and for the period ended December 31, 2019 was as follows (in thousands): As of December 31, 2019 As Reported Balances without the Adoption of Topic 606 Effect of Adoption Higher/ (Lower) Current portion of deferred revenue $ 7,000 $ 7,917 $ (917 ) Long-term portion of deferred revenue 12,022 13,594 (1,572 ) Accumulated deficit $ - $ - $ (2,489 ) Year ended December 31, 2019 As Reported Without the Adoption of Topic 606 Effect of Adoption Higher/ (Lower) Collaboration and license revenue $ 15,000 $ 14,722 $ 278 Net loss (84,710 ) (84,988 ) 278 Net loss per share, basic and diluted $ (1.93 ) $ (1.94 ) $ 0.01 Impact of Adoption – ASU 2016-18 In November 2016, the FASB issued ASU No. 2016-18 (Topic 230), Restricted Cash, Statement of Cash Flows (ASU 2016-18) The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amount shown on the consolidated statements of cash flows (in thousands): December 31, 2019 December 31, 2018 Cash and cash equivalents $ 57,937 $ 71,064 Restricted cash 203 203 Cash, cash equivalents and restricted cash $ 58,140 $ 71,267 Impact of Adoption – ASU 2018-07 In June 2018, the FASB issued ASU No. 2018-07 (Topic 718), Compensation – Stock Compensation (ASU 2018-07). ASU 2018-07 requires Recently Issued Accounting Standards or Updates Not Yet Effective In February 2016, the FASB issued ASU No. 2016-02 (Topic 842), Leases In June 2016, the FASB issued ASU No. 2016 Measurement of Credit Losses on Financial Instruments As a result of the Company having elected the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act, ASU 2016-13 is effective for the Company for the year ended December 31, 2023, and all interim periods within that fiscal year. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU No.2018-13 (Topic 820), Fair Value Measurement. In August 2018, the FASB issued ASU No.2018-15 (Subtopic 350-40), Intangible – Goodwill and Other – Internal-Use Software. In November 2018, the FASB issued ASU No. 2018-18 (Topic 808), Collaborative Arrangements In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. ASU 2019-12 reduces costs and complexity of applying accounting standards while maintaining the usefulness of the information provided to users of financial statements. As a result of the Company having elected the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act, ASU 2019-12 is effective for the Company for the year ended December 31, 2022, and all interim periods within that fiscal year. Early adoption is permitted. The Company is assessing the impact of the standard on the Company’s consolidated financial statements. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 3. Fair Value Measurements Financial assets and liabilities are recorded at fair value. The accounting guidance for fair value provides a framework for measuring fair value, clarifies the definition of fair value and expands disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value as follows: Level 1—Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2—Inputs (other than quoted market prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Level 3—Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. During the periods presented, the Company has not changed the manner in which it values assets and liabilities that are measured at fair value. The Company recognizes transfers between levels of the fair value hierarchy as of the end of the reporting period. There were no transfers within the hierarchy during the years ended December 31, 2019 and 2018. The following tables set forth the Company’s financial instruments (excluding restricted cash) that were measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): December 31, 2019 Total Level 1 Level 2 Level 3 Money market funds $ 45,498 $ 45,498 $ - $ - U.S. government agency obligations 74,854 - 74,854 - Corporate securities and commercial paper 67,918 - 67,918 - Total assets measured at fair value $ 188,270 $ 45,498 $ 142,772 $ - December 31, 2018 Total Level 1 Level 2 Level 3 Money market funds $ 45,017 $ 45,017 $ - $ - U.S. government agency obligations 103,940 - 103,940 - Corporate securities and commercial paper 110,768 - 110,768 - Total assets measured at fair value $ 259,725 $ 45,017 $ 214,708 $ - Classified as (with contractual maturities): Year Ended December 31, 2019 2018 Cash and cash equivalents $ 57,937 $ 71,064 Short-term investments (due within one year) 130,333 185,480 Long-term investments (due between one and two years) - 3,181 $ 188,270 $ 259,725 The investments are classified as available-for-sale marketable securities. At December 31, 2019 and 2018, the balance in the Company’s accumulated other comprehensive loss comprised activity related to the Company’s available-for-sale marketable securities. There were no realized gains or losses recognized on the sale or maturity of available-for-sale marketable securities during the years ended December 31, 2019 and 2018, and as a result, the Company did not reclassify any amounts out of accumulated other comprehensive loss for the periods then ended. The Company has a limited number of available-for-sale marketable securities in loss positions as of December 31, 2019, which the Company does not intend to sell and has concluded it will not be required to sell before recovery of the amortized cost for the investment at maturity. The fair value and amortized cost of investments in marketable securities by major security type as of December 31, 2019 and 2018 are presented in the tables that follow (in thousands): Amortized Cost Unrealized Gain Unrealized Loss Fair Value As of December 31, 2019: Money market funds $ 45,498 $ - $ - $ 45,498 U.S. government agency obligations 74,801 12 (1 ) 74,812 Corporate securities and commercial paper 67,907 55 (2 ) 67,960 Total $ 188,206 $ 67 $ (3 ) $ 188,270 Amortized Cost Unrealized Gain Unrealized Loss Fair Value As of December 31, 2018: Money market funds $ 45,017 $ - $ - $ 45,017 U.S. government agency obligations 103,957 - (17 ) 103,940 Corporate securities and commercial paper 110,859 - (91 ) 110,768 Total $ 259,833 $ - $ (108 ) $ 259,725 |
Consolidated Balance Sheet Comp
Consolidated Balance Sheet Components | 12 Months Ended |
Dec. 31, 2019 | |
Balance Sheet Related Disclosures [Abstract] | |
Consolidated Balance Sheet Components | Note 4. Consolidated Balance Sheet Components Property and Equipment Property and equipment, net consisted of the following (in thousands): As of December 31, 2019 2018 Scientific equipment $ 8,168 $ 6,628 Furniture and equipment 1,165 813 Capitalized software 146 146 Leasehold improvements 10,834 10,828 Construction in progress 238 335 Total 20,551 18,750 Less: Accumulated depreciation and amortization (11,221 ) (7,643 ) Property and equipment, net $ 9,330 $ 11,107 Accrued Liabilities Accrued liabilities consisted of the following (in thousands): As of December 31, 2019 2018 Accrued personnel expenses $ 4,571 $ 2,833 Accrued research and development expenses 4,572 2,816 Professional fees 183 211 Other 196 163 Total accrued liabilities $ 9,522 $ 6,023 |
Equity Investment in PACT Pharm
Equity Investment in PACT Pharma | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Equity Investment in PACT Pharma | Note 5: Equity Investment in PACT Pharma In 2016, the Company purchased approximately 3.6 million shares of common stock of PACT Pharma, Inc. (PACT Pharma), a privately funded, early-stage biopharmaceutical company focused on adoptive cell therapy, and 1.0 million shares of Series A preferred stock. The Company determined the fair value of such investment to be insignificant to the Company’s 2016 financial statements given the start-up nature of operations of PACT Pharma, and it was recorded at a nominal amount. The Company also received certain warrants to purchase PACT Pharma common stock exercisable upon PACT Pharma’s achievement of certain valuation thresholds pursuant to a Master Services Agreement between the Company and PACT Pharma (the PACT Agreement), which agreement has since expired. The Company determined PACT Pharma to be a variable interest entity, and that the Company has a variable interest in PACT. However, because the Company is not the primary beneficiary of PACT Pharma, it is not required to consolidate the results of operations of PACT Pharma within its consolidated financial statements. The Company’s investment in PACT Pharma is accounted for as an equity method investment, and as a result the Company records its share of PACT Pharma’s operating results in interest and other income, net, in its consolidated statements of operations and comprehensive loss. During the year ended December 31, 2019, the Company’s share of PACT Pharma’s losses exceeded the carrying amount of the equity investment. Since the Company has no obligation to provide cash financing to PACT Pharma, no additional losses are being recorded beyond the investment’s carrying amount. For the year ended December 31, 2019, the Company recorded a $1.2 million loss for its share of PACT Pharma’s operating losses, and as of December 31, 2019 the carrying amount of the investment was zero. The unrecognized equity method losses in excess of the Company’s investment was $0.8 million as of December 31, 2019. For the year ended December 31, 2018, the Company recorded $0.9 million relating to its share of PACT Pharma’s operating losses. For the years ended December 31, 2019 and 2018, the Company determined the fair value of the warrants to be insignificant to the consolidated financial statements. |
License and Collaboration Agree
License and Collaboration Agreements | 12 Months Ended |
Dec. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
License and Collaboration Agreements | Note 6. License and Collaboration Agreements Taiho Pharmaceutical Co., Ltd In September 2017, the Company and Taiho entered into an option and license agreement (the Taiho Agreement) to collaborate on the potential development and commercialization of certain investigational products from the Company’s portfolio in Japan and certain other territories in Asia (excluding China) (the Taiho Territory). The Taiho Agreement provides Taiho with exclusive options, over a five-year period (the Option Period), to obtain an exclusive development and commercialization license to clinical stage investigational products from the Company’s programs (each, an Arcus Program). In consideration for the exclusive options and other rights contained in the Taiho Agreement, Taiho agreed to make non-refundable, non-creditable cash payments to the Company totaling $35.0 million, of which the Company received $25.0 million during 2017. An additional $5.0 million was received in 2018 and the remaining $5.0 million was received in 2019. In the event that the Company has not initiated IND enabling studies for at least five Arcus Programs prior to the expiration of the Option Period, Taiho may elect to extend the Option Period, up to a maximum of seven years, subject to an extension fee. For each option that Taiho elects to exercise, they will be obligated to make an option exercise payment of between $3.0 million to $15.0 million, depending on the development stage of the applicable Arcus Program for which the option is exercised. In addition, the Taiho Agreement provides that the Company is eligible to receive additional clinical and regulatory milestones totaling up to $130.0 million per Arcus Program, and it will be eligible to receive contingent payments of up to $145.0 million per Arcus Program associated with the achievement of specified levels of Taiho net sales in the Taiho Territory. In addition, the Company will receive royalties ranging from high single-digits to mid-teens on net sales of licensed products in the Taiho Territory. Royalties will be payable on a licensed product-by-licensed product and country-by-country basis during the period of time commencing on the first commercial sale of a licensed product in a country and ending upon the later of: (a) ten (10) years from the date of first commercial sale of such licensed product in such country; and (b) expiration of the last-to-expire valid claim of the Company’s patents covering the manufacture, use or sale or exploitation of such licensed product in such country (the Royalty Term). The Company evaluated the Taiho Agreement under ASC 606 and determined that the current performance obligations consist of (1) the research and development services, in which the Company will use commercially reasonable efforts to initiate IND enabling studies for at least five Arcus Programs, as well as further develop such Arcus Programs during the term of the Agreement, and (2) the obligation to participate on the joint steering committee. These deliverables are non-contingent in nature. The Company determined that the obligation to participate in the joint steering committee does not have stand-alone value to Taiho because the committee’s primary purpose is to monitor and govern the research and development activities and, hence, it is inseparable from the research and development services. The Company’s assessment of the transaction price included an analysis of amounts it expected to receive, which at contract inception consisted of the upfront cash payment of $20.0 million due upon contract execution in September 2017, a $5.0 million payment due within 30 days of contract execution, an anniversary payment of $5.0 million due in 2018, and a final anniversary payment of $5.0 million due in 2019. All payments were made by Taiho as they became due and payable so given this successful collection history, the Company considers the entire $35.0 million in non-refundable fees to be the initial transaction price. The Company determined that the combined performance obligation of the research and development services and the obligation to participate on the joint steering committee are satisfied over time. The Company uses a time-elapsed input method to measure progress toward satisfying its performance obligation, which is the method the Company believes most faithfully depicts the Company’s performance in transferring the promised services during the time period in which Taiho has access to the Company’s research and development activities. Accordingly, the transaction price of $35.0 million is being recognized using this input method over the estimated performance period of five years. The Company also concluded that, at the inception of the agreement, Taiho’s exclusive options are not considered material rights as the options do not contain a significant and incremental discount. The Company therefore excludes the exclusive options from the initial transaction price and accounts for them as separate contracts. In 2018, Taiho exercised its option to the Company’s adenosine receptor antagonist program, including AB928, for a fee of $3.0 million, which was recognized by the Company as revenue during the year ended December 31, 2018 under Topic 605. The adoption of Topic 606 in 2019 had no effect on the revenue recognized for this fee. In 2019, Taiho exercised its option to the Company’s anti-PD-1 antibody program, including zimberelimab (formerly referred to as AB122) for a fee of $8.0 million. The Company identified one performance obligation comprised of the delivery of the license, which was completed in 2019. The transaction price was determined to be the payment of $8.0 million, which was recognized by the Company as licensing revenue during the year ended December 31, 2019 under Topic 606. Upon the option exercises, Taiho gained sole responsibility for the development and commercialization of the licensed products from within the programs in the Taiho Territory. The Company also determined that the clinical and regulatory milestone payments under the Taiho Agreement are variable consideration under Topic 606 which need to be added to the transaction price when it is probable that a significant revenue reversal will not occur. Based on the nature of the clinical and regulatory milestones, such as the regulatory approvals which are not within the Company’s control, the Company will not consider achievement of such milestones to be probable until the uncertainty associated with the milestones has been resolved. When it is probable that a significant reversal of revenue will not occur, the milestone payment will be added to the transaction price, which will then be allocated to each performance obligation, on a relative standalone selling price basis, for which the Company recognizes revenue. The Company also considers the contingent payments due from Taiho upon the achievement of specified sales volumes to be similar to royalty payments. The Company considers the license to be the predominant item to which the royalties relate. The Company will recognize revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). As of December 31, 2019, no sales milestone or royalty revenue has been recognized. The Taiho Agreement shall remain in effect until expiry of all Royalty Terms for the licensed products, in each case subject to certain exceptions. During the year ended December 31, 2019, the Company recognized a total of $15.0 million of revenue under the Taiho Agreement in accordance with Topic 606, consisting of revenue recognized for the option exercised and the non-refundable upfront research and development fees. During the year ended December 31, 2018, the Company recognized a total of $8.3 million of revenue under the Taiho Agreement in accordance with Topic 605, consisting of revenue recognized for the option exercised and the non-refundable upfront research and development fees. As of December 31, 2019, the Company recorded deferred revenue, current and deferred revenue, noncurrent of $7.0 million and $12.0 million, respectively, in its consolidated balance sheet. Changes in Deferred Revenue Balances The Company recognized the following revenue as a result of changes in the deferred revenue balance during the period below (in thousands): Year Ended December 31, Revenue recognized in the period from: 2019 Amounts included in deferred revenue at the beginning of the period $ 7,000 Performance obligations satisfied in previous period $ - WuXi Biologics License Agreement The Company entered into a license agreement (the WuXi Agreement) with WuXi Biologics (Cayman) Inc. (WuXi Biologics) in August 2017, as subsequently amended in June 2019, in which it obtained an exclusive license to develop, use, manufacture, and commercialize products including an anti-PD-1 antibody worldwide except for Greater China and Thailand. The Company made a milestone payment of $7.5 million and incurred a sub-license fee of $1.2 million during the year ended December 31, 2019, which were recorded as research and development expense, as the products had not reached technological feasibility and did not have alternative future use. No milestone payments were made during the year ended December 31, 2018. The WuXi Agreement also provides for clinical and regulatory milestone payments, commercialization milestone payments of up to $375.0 million, and tiered royalty payments to be made to WuXi Biologics that range from the high single-digits to low teens of net sales by the Company of licensed products. Abmuno License Agreement In December 2016, the Company entered into a license agreement (the Abmuno Agreement) with Abmuno Therapeutics LLC (Abmuno) in which it obtained a worldwide exclusive license to develop, use, manufacture, and commercialize products that include an anti-TIGIT antibody. No milestone payments were made during the year ended December 31, 2019. The Company made milestone payments of $2.8 million for the year ended December 31, 2018, which were recorded as research and development expense, as the products have not reached technological feasibility and do not have alternative future use. The Abmuno Agreement also provides for additional clinical, regulatory and commercialization milestone remaining payments of up to $101.0 million as of December 31, 2019. Genentech Collaboration Agreement In December 2019, the Company and Genentech, through F. Hoffmann-La Roche Ltd (collectively, Genentech) entered into a Master Clinical Collaboration Agreement (the Genentech Agreement) pursuant to which the parties may conduct combination clinical studies involving Genentech’s monoclonal antibody, atezolizumab (TECENTRIQ®) and the Company’s investigational products. Pursuant to the Genentech Agreement, the parties entered into Trial Supplements for the evaluation of AB928 and atezolizumab utilizing the MORPHEUS platform in two separate study indications: second and third line metastatic colorectal cancer and first line metastatic pancreatic cancer. The Company and Genentech will each supply their respective investigational products for use in the collaboration studies and will share a portion of the development costs under specific terms as set forth in the agreement. For the year ended December 31, 2019, no expense was incurred. Strata Collaboration Agreement On April 30, 2019, the Company and Strata Oncology, Inc. (Strata) entered into a Co-Development and Collaboration Agreement (the Co-Development and Collaboration Agreement) to pursue a clinical development collaboration utilizing Strata’s precision drug development platform and proprietary biomarkers to evaluate zimberelimab, the Company’s clinical-stage anti-PD-1 antibody, in patients in a tumor-agnostic fashion. Under the terms of the Co-Development and Collaboration Agreement, the parties will share a portion of development costs for the clinical collaboration under specified terms. Strata is eligible to receive $2.5 million upon the achievement of a development milestone, as well as regulatory and commercial milestones of up to $125.0 million and up to double-digit royalties on U.S. net sales of AB122 in the biomarker-identified indication. The Company made a milestone payment to Strata of $2.5 million for the year ended December 31, 2019, which was recorded as a research and development expense. For the year ended December 31, 2019, the Company incurred expenses of $1.0 million, of which $0.2 million had been reimbursed by Strata as development cost sharing. Net expenses related to this co-development agreement were recorded within research and development expenses. As further consideration in connection with the Co-Development and Collaboration Agreement, the Company issued to Strata 1,257,651 restricted shares of its common stock with an initial measured fair value of $15.0 million, which are subject to vesting based upon the achievement of specified regulatory milestones within certain timelines. Expense relating to the restricted shares subject to these milestones is recognized if it is considered probable that the associated shares will vest. The probability of achievement is assessed at the end of each quarterly period. As of December 31, 2019, the Company determined that none of the restricted shares were probable of vesting and, as a result, no compensation expense related to the restricted shares has been recognized to date. |
Convertible Preferred Stock and
Convertible Preferred Stock and Stockholders’ Equity (Deficit) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders Equity Note [Abstract] | |
Convertible Preferred Stock and Stockholders’ Equity (Deficit) | Note 7: Convertible Preferred Stock and Stockholders’ Equity (Deficit) The Company’s Certificate of Incorporation, as amended and restated, authorizes the Company to issue 410,000,000 shares of capital stock consisting of 400,000,000 shares common stock and 10,000,000 shares of preferred stock, both par value of $0.0001. As of December 31, 2019 and 2018, the Company had reserved common stock, on an if-converted basis, for issuance as follows: As of December 31, 2019 2018 Common stock options issued and outstanding 4,738,004 1,458,080 Remaining shares available for issuance under 2015 & 2018 Stock Plan 2,315,099 3,801,191 Unvested restricted stock issued as part of collaboration agreement 1,257,651 - Total 8,310,754 5,259,271 As of December 31, 2019 and 2018, the Company had no outstanding convertible preferred stock. In connection with the completion of the Company’s IPO in March 2018, all outstanding shares of convertible preferred stock converted into 30,459,574 shares of common stock. |
Stock Plan and Stock-Based Comp
Stock Plan and Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock Plan and Stock-Based Compensation | Note 8: Stock Plan and Stock-Based Compensation Equity Incentive Plans In May 2015, the Company adopted the 2015 Stock Plan, which was amended and restated in November 2015 (as amended from time to time, the 2015 Plan). The terms of the 2015 Plan permitted option holders to exercise stock options before they vest, subject to certain limitations. Such unvested shares are subject to repurchase by the Company at the original exercise price in the event the option holder’s service to the Company is terminated either voluntarily or involuntarily. As a result of early exercises under the 2015 Plan, approximately 455,158 and 927,123 shares had not vested and were subject to repurchase as of December 31, 2019 and 2018, respectively. The Company treats cash received from the exercise of unvested options as a refundable deposit and classifies such amounts as a liability in its consolidated balance sheets. As of December 31, 2019 and 2018, the Company included cash received for the early exercise of unvested options of $1.7 million and $2.8 million, respectively, in other current and long-term liabilities, based on the timing of their expected vesting. Amounts included in liabilities are transferred into common stock and additional paid-in capital as the shares vest, which is generally over a period of 48 months. In March 2018, the Company adopted the 2018 Equity Incentive Plan (2018 Plan), which replaced the 2015 Plan upon completion of the IPO. 3,570,000 shares were reserved under the 2018 Plan plus 709,558 shares remaining available for issuance under the Company’s 2015 Plan and outstanding awards under its 2015 Plan that subsequently expire, lapse unexercised or are forfeited to or repurchased by the Company. In addition, the number of shares reserved for issuance under our 2018 Plan will automatically increase on January 1 of each year beginning January 1, 2019 by a number equal to the smallest of (i) 3,570,000 shares, (ii) 4% of the shares of common stock outstanding on the last business day of the prior fiscal year or (iii) the number of shares determined by our board of directors. As of December 31, 2019, there were 2,315,099 shares available for grant under the 2018 Plan. In accordance with the provisions of the 2018 Plan, the number of shares available for issuance under the Plan automatically increased by 1,837,000 shares on January 1, 2020. The following table, which includes options granted under the 2015 Plan, 2018 Plan and the Non-Plan Option, summarizes option activity: Shares Subject to Outstanding Options Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2018 1,458,080 $ 7.55 Options granted 3,967,746 $ 9.66 Options exercised (41,762 ) $ 4.85 Options forfeited or canceled (646,060 ) $ 10.01 Outstanding at December 31, 2019 4,738,004 $ 9.00 8.83 $ 8,174 Options vested and expected to vest as of December 31, 2019 4,738,004 $ 9.00 8.83 $ 8,174 Options exercisable as of December 31, 2019 1,145,303 $ 8.52 7.97 $ 2,851 As of December 31, 2019, unrecognized employee and nonemployee compensation costs of $23.7 million related to non-vested stock option awards is expected to be recognized over a weighted average period of 2.9 years. During the years ended December 31, 2019 and 2018, the intrinsic value of shares exercised was $0.2 million and $0.6 million, respectively, and the fair value of shares vested during the respective years was $7.8 million and $3.0 million. Employee Stock Purchase Plan In March 2018, the Company adopted the 2018 Employee Stock Purchase Plan (2018 ESPP). The 2018 ESPP provides eligible employees with the opportunity to purchase shares of common stock through payroll deductions at a price equal to 85% of the lower of the fair market value per share on the first trading day of the applicable 24-month offering period or the fair market value per share on the applicable purchase date, provided that no more than 3,000 shares of common stock may be purchased by an employee on any purchase date. Also, the value of the shares purchased in any calendar year may not exceed $25,000. The 2018 ESPP is intended to constitute an “employee stock purchase plan” under Section 423(b) of the Internal Revenue Code of 1986, as amended. The 2018 ESPP may be terminated by the Company’s board of directors at any time. A total of 714,000 shares of common stock were initially reserved for issuance under the 2018 ESPP, and the number of shares reserved for issuance under the 2018 ESPP will automatically increase on January 1 of each year beginning on January 1, 2019 by a number of shares equal to the least of (i) 1% of our outstanding shares of common stock on the last day of the prior fiscal year, (ii) 1,071,000 shares or (iii) a number of shares determined by our board of directors. As of December 31, 2019, there were 933,273 shares available for purchase under the 2018 ESPP. In accordance with the provisions of the 2018 ESPP, the number of shares available for purchase under the Plan automatically increased by 459,250 shares on January 1, 2020. Restricted stock awards In 2015, in conjunction with the incorporation of the Company, the Company issued a total of 2,777,776 shares of common stock at $0.0004 per share to its two founders, the Chief Executive Officer and the President, under restricted stock agreements. At the date of grant, the shares had an estimated fair value of $0.0004 per share. Under the terms of the restricted stock agreements, shares vest monthly over four years. Upon the termination of service of these individuals, unvested shares are subject to repurchase by the Company at the original issue price. A summary of the Company’s non-vested restricted stock for the periods presented is as follows: Number of Shares Weighted Average Grant Date Fair Value Remaining Contractual Term (Years) Balance, December 31, 2018 289,352 $ 0.000396 0.4 Vested during the year 289,352 $ 0.000396 Balance, December 31, 2019 - $ - - Non-employee stock-based compensation As of December 31, 2019 and 2018, 372,774 and 14,918 respectively, of vested stock options and 308,596, and 31,388, respectively, of unvested stock options were held by non-employees. The amount of stock-based compensation expense related to non-employees recognized in the consolidated financial statements for the years ended December 31, 2019 and 2018 was $0.9 million and $0.3 million, respectively. Stock-based compensation expense The following table summarizes employee and non-employee stock-based compensation expense for the years ended December 31, 2019 and 2018, and also the allocation within the consolidated statements of operations and comprehensive loss (in thousands): Year Ended December 31, 2019 2018 Research and development $ 4,152 $ 2,255 General and administrative 4,829 1,619 Total stock-based compensation $ 8,981 $ 3,874 Valuation Assumptions The Company estimates the fair value of options and ESPP shares utilizing the Black-Scholes option pricing model, which is dependent upon several variables, such as expected term, volatility, risk-free interest rate, and expected dividends. Each of these inputs is subjective and generally requires significant judgment to determine. Stock-based compensation is measured at the grant date based on the fair value of the award and is recognized as expense, net of forfeitures, over the requisite service period, which is generally the vesting period of the respective award. The Company recognizes compensation on a straight-line basis over the requisite vesting period for each award. The following assumptions were used to calculate the fair value of stock-based compensation for the years ended December 31, 2019, and 2018: Stock Options ESPP Year Ended December 31, Year Ended December 31, 2019 2018 2019 2018 Risk-free interest rate 1.6% - 2.3% 1.2% - 3.1% 1.6% - 2.3% 2.1% - 2.6% Expected term (in years) 6.02 5.16-9.95 0.5-2.0 0.5-2.0 Volatility 71.8% - 74.6% 58.7%-75.5% 64.8% - 77.1% 54.3% - 65.5% Dividend yield 0% 0% 0% 0% Expected Term — The Company has opted to use the “simplified method” for estimating the expected term of options, whereby the expected term equals the arithmetic average of the vesting term and the original contractual term of the option (generally 10 years). Expected Volatility — Due to the Company’s limited operating history and a lack of company specific historical and implied volatility data, the Company has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. The historical volatility data was computed using the daily closing prices for the selected companies’ shares during the equivalent period of the calculated expected term of the stock-based awards. Risk-Free Interest Rate — The risk-free rate assumption is based on the U.S. Treasury instruments with maturities similar to the expected term of the Company’s stock options. Expected Dividend — The Company has not issued any dividends in its history and does not expect to issue dividends over the life of the options and therefore has estimated the dividend yield to be zero. Fair value of Common Stock — The fair value of the shares of common stock underlying the stock-based awards has historically been determined by the board of directors, with input from management. Because there has been no public market for the Company’s common stock, the board of directors has determined the fair value of the common stock on the grant-date of the stock-based award by considering a number of objective and subjective factors, including enterprise valuations of the Company’s common stock performed by an unrelated third-party specialist, valuations of comparable companies, sales of the Company’s convertible preferred stock to unrelated third parties, operating and financial performance, the lack of liquidity of the Company’s capital stock, and general and industry-specific economic outlook. The board of directors intended all options granted to be exercisable at a price per share not less than the estimated per share fair value of common stock underlying those options on the date of grant. |
Net Loss per Share
Net Loss per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | Note 9. Net Loss per Share The following table sets forth the computation of basic and diluted net loss per share (in thousands, except share and per share data): Year Ended December 31, 2019 2018 Numerator: Net loss $ (84,710 ) $ (49,594 ) Denominator: Weighted-average common shares outstanding 45,385,489 36,357,336 Less: weighted-average common shares subject to repurchase (1,559,498 ) (1,739,099 ) Weighted-average common shares used to compute basic and diluted net loss per share 43,825,991 34,618,237 Net loss per share, basic and diluted $ (1.93 ) $ (1.43 ) The following outstanding potentially dilutive securities were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive: At December 31, 2019 2018 Common stock options issued and outstanding 4,738,004 1,458,079 Unvested early exercised common stock options 455,158 927,123 Unvested restricted stock issued as part of collaboration agreement 1,257,651 - Unvested restricted common stock - 289,352 Total 6,450,813 2,674,554 |
Provision for Income Taxes
Provision for Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Provision for Income Taxes | Note 10: Provision for Income Taxes The provision for income taxes differs from the amount expected by applying the federal statutory rate to the loss before taxes as follows: Year Ended December 31, 2019 2018 Federal statutory income tax rate 21.00 % 21.00 % Non-deductible expenses and other (1.35 )% (1.54 )% Change in valuation allowance (19.65 )% (19.46 )% Total 0.00 % 0.00 % As of December 31, 2019 and 2018, the components of the Company’s deferred tax assets are as follows (in thousands): Year Ended December 31, 2019 2018 Deferred tax assets: Federal and state net operating loss carryforwards $ 30,049 $ 16,076 Research and development credits carryforwards 8,077 5,087 Depreciation 6,052 3,942 Deferred Revenue 3,277 3,909 Other 2,965 1,724 Total deferred tax assets 50,420 30,738 Less valuation allowance (50,420 ) (30,738 ) Net deferred tax assets $ - $ - Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, and (b) operating losses and tax credit carryforwards. The Company’s accounting for deferred taxes involves the evaluation of a number of factors concerning the realizability of its net deferred tax assets. The Company primarily considered such factors as its history of operating losses, the nature of the Company’s deferred tax assets, and the timing, likelihood and amount, if any, of future taxable income during the periods in which those temporary differences and carryforwards become deductible. At present, the Company does not believe that it is more likely than not that the deferred tax assets will be realized; accordingly, a full valuation allowance has been established and no deferred tax asset is shown in the accompanying consolidated balance sheets. The valuation allowance increased by approximately $19.7 million and 12.2 million, respectively, for the years ended December 31, 2019 and 2018. At December 31, 2019, the Company has total net operating loss carryforwards (NOLs) of $137.1 million for federal income tax purposes, of which approximately $47.4 million begin to expire in 2035 and approximately $89.7 million that have no expiration date and federal research tax credits of approximately $6.1 million that begin to expire in 2035. The Company also has state NOLs of approximately $16.9 million that begin to expire in 2035, and state research tax credits of approximately $5.0 million that have no expiration date. Use of the NOLs and credit carryforwards may be subject to a substantial annual limitation due to the ownership change provisions of U.S. tax law, as defined in Section 382 and 383 of the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of NOLs and credits before use. The Company determined that an ownership change occurred in 2015 in conjunction with its Series A Preferred Stock financing and in 2017 in conjunction with its Series C Preferred Stock financing but does not expect that these ownership changes will result in the expiration of any the NOLs prior to utilization. The Company has not been audited by the Internal Revenue Service, any state or foreign tax authority. The Company is subject to taxation in the United States and also beginning in 2017, in Australia. Because of the net operating loss and research credit carryforwards, all of the Company’s tax years, from 2015 to 2018, remain open to U.S. federal and California state tax examinations. In addition, the Company’s tax years from 2017 to 2018 are open to examination in Australia. There were no interest or penalties accrued at December 31, 2019 or 2018. Uncertain Tax Positions The Company follows the provisions of FASB Accounting Standards Codification (ASC 740-10), Accounting for Uncertainty in Income Taxes Due to the full valuation allowance at December 31, 2019 and 2018, current adjustments to the unrecognized tax benefit will have no impact on the Company’s effective income tax rate; any adjustments made after the valuation allowance is released will have an impact on the tax rate. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Year Ended December 31, 2019 2018 Beginning balance $ 1,084 $ 622 Additions (decreases) for tax positions taken in a prior year (7 ) 8 Additions for tax positions taken in current year 1,088 454 Ending balance $ 2,165 $ 1,084 The Company does not anticipate material changes to its uncertain tax positions through the next 12 months. |
Commitments
Commitments | 12 Months Ended |
Dec. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments | Note 11: Commitments Purchase Commitments The Company has contractual arrangements with research and development organizations and suppliers; however, these contracts are generally cancelable on 30 days’ notice and the obligations under these contracts are largely based on services performed. Leases The Company leases office space in Hayward, California under non-cancelable operating leases with expiration in 2025. Rent expense was $1.6 million Year ending December 31: Operating Leases 2020 $ 2,105 2021 2,195 2022 2,265 2023 2,339 2024 2,415 2025 2,072 Total $ 13,391 Total minimum lease payments have not been reduced by minimum sublease rent income of approximately $0.1 million under a future noncancelable sublease. The Company has provided deposits for letters of credit totaling $0.2 million to secure its obligations under its lease, which have been classified as long-term assets on the Company’s consolidated balance sheet as of December 31, 2019. Indemnification As permitted under Delaware law and in accordance with the Company’s bylaws, the Company is required to indemnify its officers and directors for certain events or occurrences while the officer or director is or was serving in such capacity. The Company is also party to indemnification agreements with its directors and officers. The Company believes the fair value of the indemnification rights and agreements is minimal. Accordingly, the Company has not recorded any liabilities for these indemnification rights and agreements as of December 31, 2019 and 2018. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2019 | |
Compensation And Retirement Disclosure [Abstract] | |
Employee Benefit Plan | Note 12: Employee Benefit Plan The Company sponsors a 401(k) defined contribution plan for its employees. This plan provides for tax-deferred salary deductions for all employees. Employee contributions are voluntary. Employees may contribute up to 100% of their annual compensation to this plan, as limited by an annual maximum amount as determined by the Internal Revenue Service. The Company may match employee contributions in amounts to be determined at the Company’s sole discretion. The Company made no contributions to the plan for the years ended December 31, 2019 and 2018. In January 2020, the Company’s Board of Directors adopted the 2020 Inducement Plan, pursuant to which it reserved and authorized 3,000,000 shares of the Company’s common stock in order to award non-statutory stock options and other equity-based awards as a material inducement to eligible individuals to enter into employment with the Company. No shares have been issued under the 2020 Inducement Plan. |
Selected Unaudited Quarterly Fi
Selected Unaudited Quarterly Financial Data | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Unaudited Quarterly Financial Data | Note 13: Selected Unaudited Quarterly Financial Data The following table summarizes the Company’s unaudited quarterly financial data for the last two years (in thousands, except per share data): First Quarter Second Quarter Third Quarter Fourth Quarter 2019 Total revenues $ 1,750 $ 1,750 $ 1,750 $ 9,750 Total operating expenses $ 20,523 $ 30,910 $ 24,999 $ 27,277 Net loss $ (17,670 ) $ (28,090 ) $ (22,352 ) $ (16,598 ) Net loss per share — basic and diluted $ (0.41 ) $ (0.64 ) $ (0.51 ) $ (0.38 ) Weighted average number of shares, basic and diluted 43,508,592 43,797,718 43,939,281 44,056,407 2018 Total revenues $ 1,250 $ 1,250 $ 4,291 $ 1,562 Total operating expenses $ 14,581 $ 17,149 $ 16,436 $ 15,046 Net loss $ (12,954 ) $ (13,533 ) $ (10,812 ) $ (12,295 ) Net loss per share — basic and diluted $ (1.37 ) $ (0.32 ) $ (0.25 ) $ (0.28 ) Weighted average number of shares, basic and diluted 9,488,352 42,533,641 42,838,098 43,163,412 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements and accompanying notes have been prepared in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP) and include all adjustments necessary for the fair presentation of the Company’s financial position for the periods presented. |
Principles of Consolidation | Principles of Consolidation During 2017, the Company established a wholly-owned subsidiary in Australia. During 2019, the Company established a wholly-owned subsidiary in Ireland. The consolidated financial statements include the Company’s accounts and those of its wholly-owned subsidiaries. All intercompany accounts, transactions and balances have been eliminated. |
Reverse Stock Split | Reverse Stock Split On March 9, 2018, the Company effected a reverse split of all shares of its common and preferred stock at a ratio of 1-for-3.96 The par values and the authorized shares of the common and preferred stock were not adjusted as a result of the Reverse Split. All references to shares of common stock outstanding, average number of shares outstanding and per share amounts in these consolidated financial statements and notes to the consolidated financial statements have been adjusted within the consolidated financial statements, on a retroactive basis, to reflect the Reverse Split |
Use of Estimates | Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as related disclosure of contingent assets and liabilities. Estimates are used to determine stock-based awards and other issuances, accruals for research and development costs, useful lives of long-lived assets, and uncertain tax positions. Actual results could differ materially from the Company’s estimates. |
Risks And Uncertainties | Risk and Uncertainties The Company’s future results of operations involve a number of risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, uncertainty of clinical trial results and achievement of milestones, uncertainty of regulatory approval of the Company’s potential drug candidates, uncertainty of market acceptance of the Company’s product candidates, competition from substitute products and larger companies, securing and protecting proprietary technology, strategic relationships and dependence on key individuals and sole source suppliers. The Company’s investigational products require approval from the U.S. Food and Drug Administration (FDA) and comparable foreign regulatory agencies prior to commercial sales in their respective jurisdictions. There can be no assurance that any investigational products will receive the necessary approvals. If the Company does not obtain regulatory approval and does not successfully commercialize any of its investigational products, it would have a materially adverse impact on the Company. |
Segments | Segments The Company operates and manages its business as one reportable and operating segment, which is the business of developing and commercializing cancer therapies. The Company’s chief executive officer, who is the chief operating decision maker, reviews financial information on an aggregate basis for purposes of allocating and evaluating financial performance. All long-lived assets are maintained in the United States of America. |
Cash Equivalents, Short-Term and Long-Term Investments | Cash Equivalents, Short-Term and Long-Term Investments Cash equivalents consist of marketable securities having an original maturity of three months or less at the time of purchase. Short-term investments have maturities of greater than three months and less than twelve months at the time of purchase. Long-term investments have maturities greater than 12 months at the time of purchase. Collectively, cash equivalents, short-term and long-term investments are considered available-for-sale and are recorded at fair value. Unrealized gains and losses are recorded in accumulated other comprehensive loss. Realized gains and losses are included in interest and other income, net in the consolidated statements of operations and comprehensive loss. The basis on which the cost of a security sold or amount reclassified out of accumulated other comprehensive income into earnings is determined using the specific identification method. |
Restricted Cash | Restricted Cash Restricted cash at December 31, 2019 and 2018 comprises cash balances primarily held as security in connection with the Company’s facility lease agreement and is included in long-term assets in the consolidated balance sheets. |
Receivable from a Related Party | Receivable from a Related Party Receivable from a related party is recorded net of any allowances. As of December 31, 2018, the outstanding amount was due from PACT Pharma, Inc. (PACT Pharma) for expenses the Company paid on its behalf. The receivable was fully paid in 2019. |
Fair Value Measurements | Fair Value Measurements Fair value accounting is applied for all financial assets and liabilities, including short-term and long-term investments, and non-financial assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis (at least annually). The carrying amount of the Company’s financial instruments, including receivable from a related party, accounts payable and accrued expenses and other current liabilities approximate fair value due to their short-term maturities. |
Concentration of Credit Risk | Concentration of Credit Risk Cash equivalents, short-term and long-term investments are financial instruments that potentially subject the Company to concentrations of credit risk. The Company invests in money market funds, treasury bills and notes, government bonds, commercial paper and corporate notes. The Company limits its credit risk associated with cash equivalents, short-term and long-term investments by placing them with banks and institutions it believes are highly credit worthy and in highly rated investments. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets, ranging from one to five years. Leasehold improvements are amortized over the shorter of their estimated useful lives or the related lease term. Upon retirement or sale, the cost and related accumulated depreciation are removed from the consolidated balance sheet and the resulting gain or loss is reflected in the consolidated statement of operations and comprehensive loss. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets, including property and equipment, for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. An impairment charge would be recorded when estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition are less than its carrying amount. Impairment, if any, is assessed using discounted cash flows or other appropriate measures of fair value. The Company did not recognize any impairment charges for the years ended December 31, 2019 and 2018. |
Revenue Recognition | Revenue Recognition At the inception of an arrangement, the Company evaluates if a counterparty to a contract is a customer, if the arrangement is within the scope of revenue from contracts with customers guidance, and the term of the contract. The Company recognizes revenue when its customer obtains control of promised goods or services in a contract for an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. For contracts with customers, the Company performs The estimation of the stand-alone selling price may include such estimates as forecasted revenues or costs, development timelines, discount rates, and probabilities of technical and regulatory success. The Company evaluates each performance obligation to determine if they can be satisfied at a point in time or over time, and the Company measures the services delivered to the customer, which are periodically reviewed based on the progress of the related program. The effect of any change made to an estimated input component and, therefore revenue or expense recognized, would be recorded as a change in estimate. In addition, variable consideration (e.g. milestone payments) must be evaluated to determine if it is constrained and, therefore, excluded from the transaction price. Upfront Research and Development Fee s: The Company identifies the performance obligations associated with the upfront research and development fees and determines if any of the promised services are distinct from each other. If a promised service is determined to be distinct, then the Company allocates the transaction price amongst the promised services based on its best judgment of their estimated stand-alone selling prices. If the promised services are not distinct, then all of the services are bundled together, and the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time. If the performance obligation is considered to be satisfied over time, the Company selects the revenue recognition method that it believes most faithfully depicts the Company’s performance in transferring control of the services. The Company may choose between two methods to measure progress toward complete satisfaction of a performance obligation over time: input methods or output methods. Input methods recognize revenue on the basis of the entity’s efforts or inputs to the satisfaction of a performance obligation (e.g., resources consumed, labor hours expended, costs incurred, or time elapsed) relative to the total expected inputs to the satisfaction of that performance obligation. Output methods recognize revenue on the basis of direct measurements of the value to the customer of the goods or services transferred to date relative to the remaining goods or services promised under the contract (e.g. surveys of performance completed to date, appraisals of results achieved, milestones reached, time elapsed, and units produced or units delivered). The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Option Fees: At the inception of each arrangement that includes option exercise fees to obtain development and commercialization licenses for the Company’s products, the Company determines whether or not such option fee is considered a material right. If the option is considered a material right, then that option is considered a separate performance obligation in the contract and the transaction price includes the option fee in the allocation amongst the performance obligations. If the option is not considered a material right, then the option is accounted for as a separate contract. Milestone Payments: For arrangements that include development milestone payments, the Company consider the milestone payments to be variable consideration under ASC 606 at the inception of the arrangement, evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company’s or the licensee’s control, such as regulatory approvals, are not considered probable of being earned until the uncertainty associated with the approvals has been resolved. The transaction price is then allocated to each performance obligation, on a relative standalone selling price basis, which the Company recognizes as revenue when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of earning such development milestones and any related constraint, 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 earnings in the period of adjustment. Royalties: For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). Upfront payments and fees are recorded as deferred revenue when due and payable and may require deferral of revenue recognition to a future period until the Company performs its obligations under these arrangements. Amounts payable to the Company are recorded as accounts receivable when the Company’s right to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less. |
Research and Development Expenses | Research and Development Expenses Research and development costs are expensed as incurred. Research and development expenses consist primarily of personnel costs for the Company’s research and development employees, costs incurred to third-party service providers for the conduct of research, preclinical and clinical studies, laboratory supplies and equipment maintenance costs, product license fees, consulting and other related expenses. Also included are non-personnel costs such as professional fees payable to third parties for preclinical and clinical studies and research services, laboratory supplies and equipment maintenance, product licenses, and other consulting costs. The Company estimates research, preclinical and clinical study expenses based on services performed, pursuant to contracts with third-party research and development organizations that conduct and manage research, preclinical and clinical activities on its behalf. The Company estimates these expenses based on discussions with internal management personnel and external service providers as to the progress or stage of completion of services and the contracted fees to be paid for such services. If the actual timing of the performance of services or the level of effort varies from the original estimates, the Company will adjust the accrual accordingly. Payments associated with licensing agreements to acquire licenses to develop, use, manufacture and commercialize products that have not reached technological feasibility and do not have alternative future use are expensed as incurred. Payments made to third parties under these arrangements in advance of the performance of the related services by the third parties are recorded as prepaid expenses until the services are rendered. |
Leases and Rent Expense | Leases and Rent Expense The Company records rent expense on a straight-line basis over the life of the lease. In cases where there is a free rent period or future fixed rent escalations, the Company records a deferred rent liability. Additionally, the receipt of any lease incentives is recorded as a deferred rent liability which is amortized over the lease term as a reduction of rent expense. Any lease incentives that are due from the landlord but have not been collected are recorded as a receivable in Prepaid expenses and other current assets. Building improvements that are made with lease incentives or tenant allowances are capitalized as leasehold improvements and included in property and equipment in the consolidated balance sheets. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation arrangements in accordance with ASC 718, Stock Compensation Equity Based Payments to Non-Employees No. 2018-07 (Topic 718), Compensation – Stock Compensation, Stock-based awards granted include stock options with time-based vesting. ASC 718 requires the recognition of compensation expense, using a fair value-based method, for costs related to all stock-based payments. The Company’s determination of the fair value of stock options with time-based vesting on the date of grant utilizes the Black-Scholes option-pricing model, and is impacted by the Company’s common stock price as well as other variables including, but not limited to, expected term that options will remain outstanding, expected common stock price volatility over the term of the option awards, risk-free interest rates and expected dividends. The fair value of a stock-based award is recognized over the period during which an optionee is required to provide services in exchange for the option award, known as the requisite service period (usually the vesting period) on a straight-line basis. Stock-based compensation expense is recognized based on the fair value determined on the date of grant and is reduced for forfeitures as they occur. Estimating the fair value of equity-settled awards as of the grant date using valuation models, such as the Black-Scholes option pricing model, is affected by assumptions regarding a number of complex variables. Changes in the assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require significant analysis and judgment to develop. |
Convertible Preferred Stock | Convertible Preferred Stock The Company records all shares of convertible preferred stock at their respective fair values less issuance costs on the dates of issuance. The convertible preferred stock is recorded outside of stockholders’ equity (deficit) because, in the event of certain deemed liquidation events considered not solely within the Company’s control, such as a merger, acquisition and sale of all or substantially all of the Company’s assets, the convertible preferred stock will become redeemable at the option of the holders. In the event of a change of control of the Company, proceeds received from the sale of such shares will be distributed in accordance with the liquidation preferences set forth in the Company’s Amended and Restated Certificate of Incorporation unless the holders of convertible preferred stock have converted their shares of convertible preferred stock into shares of common stock. The Company has determined not to adjust the carrying values of the convertible preferred stock to the liquidation preferences of such shares because of the uncertainty of whether or when such an event would occur. All outstanding convertible preferred stock converted into common stock in March 2018 upon the effectiveness of the IPO. |
Income Taxes | Income Taxes The Company provides for income taxes under the asset and liability method. Current income tax expense or benefit represents the amount of income taxes expected to be payable or refundable for the current year. Deferred income tax assets and liabilities are determined based on differences between the financial statement reporting and tax bases of assets and liabilities and net operating loss and credit carryforwards, and are measured using the enacted tax rates and laws that will be in effect when such items are expected to reverse. Deferred income tax assets are reduced, as necessary, by a valuation allowance when management determines it is more likely than not that some or all of the tax benefits will not be realized. The Company accounts for uncertain tax positions in accordance with ASC 740-10, Accounting for Uncertainty in Income Taxes. The Company includes any penalties and interest expense related to income taxes as a component of other expense and interest income, net, as necessary. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive loss includes net loss and net unrealized income and losses on available-for-sale securities, which are presented in a single continuous statement. Other comprehensive income (loss) is also disclosed in the consolidated balance sheets and statements of stockholders’ equity in accumulated other comprehensive income (loss), and is stated net of related tax effects, if any. |
Net Loss per Share | Net Loss per Share Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common shares and potentially dilutive securities outstanding for the period. The Company excludes the weighted-average shares subject to repurchase from its calculation of weighted average of common shares outstanding. For purposes of the diluted net loss per share calculation, outstanding common stock options are considered to be potentially dilutive securities. Because the Company reported a net loss for the years ended December 31, 2019 and 2018, and the inclusion of the potentially dilutive securities would be antidilutive, diluted net loss per share is the same as basic net loss per share for all periods. |
Adopted Accounting Pronouncements | Adopted Accounting Pronouncements – Revenue Recognition Effective January 1, 2019, the Company adopted Accounting Standards Codification Topic 606, Revenue from Contracts with Customers Impact of Adoption – ASC 606 The Company entered into a license and collaboration agreement (the Taiho Agreement) in September 2017, an agreement that is within the scope of ASC 606, under which it has provided Taiho Pharmaceutical Co., Ltd (Taiho) exclusive options, over a five-year period (the Option Period) to obtain an exclusive development and commercialization license to clinical stage product candidates from the Company’s programs. The terms of the arrangement include non-refundable upfront research and development fees, option fees to obtain development and commercialization licenses for the Company’s products, milestone payments based on achievement of defined development, regulatory and sales targets, and royalties on sales of commercialized product. The Company has applied the five-step model of the new standard to the Taiho Agreement, the only Company contract that has been impacted by the adoption of the new revenue standards. The Company implemented the new revenue standard using the modified retrospective transition method. Results for the year ended December 31, 2019 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with the Company’s historic accounting under previous revenue recognition guidance, Accounting Standards Codification Topic 605: Revenue Recognition (Topic 605). Upon the adoption, the Company recorded a net reduction of $2.2 million to its opening accumulated deficit as of January 1, 2019, due to the cumulative impact of adopting Topic 606, with the impact primarily relating to an increase in the transaction price recognized for the non-refundable upfront research and development fees over the five-year term. The impact of the adoption of Topic 606 on contract liabilities and accumulated deficit balances as of January 1, 2019 was as follows (in thousands): December 31, 2018 Adjustment Due to the Adoption of Topic 606 January 1, 2019 Current portion of deferred revenue $ 6,250 $ 750 $ 7,000 Long-term portion of deferred revenue 16,984 (2,962 ) 14,022 Accumulated deficit $ (122,828 ) $ 2,212 $ (120,616 ) The adjustments due to the adoption of Topic 606 primarily relate to an increase in the transaction price recognized for the non-refundable upfront research and development fees over the five-year term. Under Topic 606, the Company recognizes revenue based on the transaction price of $35.0 million, representing the total amount that the Company expects to receive related to the non-refundable upfront fees. As of December 31, 2019, the Company had received the full $35.0 million in upfront fees, which consisted of payments of $25.0 million in 2017 at the inception of the contract and anniversary payments of $5.0 million in 2018 and 2019. Under Topic 605, the $25.0 The impact of the adoption of Topic 606 on the Company’s Consolidated Balance Sheet and Statement of Operations as of and for the period ended December 31, 2019 was as follows (in thousands): As of December 31, 2019 As Reported Balances without the Adoption of Topic 606 Effect of Adoption Higher/ (Lower) Current portion of deferred revenue $ 7,000 $ 7,917 $ (917 ) Long-term portion of deferred revenue 12,022 13,594 (1,572 ) Accumulated deficit $ - $ - $ (2,489 ) Year ended December 31, 2019 As Reported Without the Adoption of Topic 606 Effect of Adoption Higher/ (Lower) Collaboration and license revenue $ 15,000 $ 14,722 $ 278 Net loss (84,710 ) (84,988 ) 278 Net loss per share, basic and diluted $ (1.93 ) $ (1.94 ) $ 0.01 Impact of Adoption – ASU 2016-18 In November 2016, the FASB issued ASU No. 2016-18 (Topic 230), Restricted Cash, Statement of Cash Flows (ASU 2016-18) The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amount shown on the consolidated statements of cash flows (in thousands): December 31, 2019 December 31, 2018 Cash and cash equivalents $ 57,937 $ 71,064 Restricted cash 203 203 Cash, cash equivalents and restricted cash $ 58,140 $ 71,267 Impact of Adoption – ASU 2018-07 In June 2018, the FASB issued ASU No. 2018-07 (Topic 718), Compensation – Stock Compensation (ASU 2018-07). ASU 2018-07 requires |
Recently Issued Accounting Standards or Updates Not Yet Effective | Recently Issued Accounting Standards or Updates Not Yet Effective In February 2016, the FASB issued ASU No. 2016-02 (Topic 842), Leases In June 2016, the FASB issued ASU No. 2016 Measurement of Credit Losses on Financial Instruments As a result of the Company having elected the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act, ASU 2016-13 is effective for the Company for the year ended December 31, 2023, and all interim periods within that fiscal year. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU No.2018-13 (Topic 820), Fair Value Measurement. In August 2018, the FASB issued ASU No.2018-15 (Subtopic 350-40), Intangible – Goodwill and Other – Internal-Use Software. In November 2018, the FASB issued ASU No. 2018-18 (Topic 808), Collaborative Arrangements In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. ASU 2019-12 reduces costs and complexity of applying accounting standards while maintaining the usefulness of the information provided to users of financial statements. As a result of the Company having elected the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act, ASU 2019-12 is effective for the Company for the year ended December 31, 2022, and all interim periods within that fiscal year. Early adoption is permitted. The Company is assessing the impact of the standard on the Company’s consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
ASC 606 | |
Significant Accounting Policies [Line Items] | |
Impact of Adoption | The impact of the adoption of Topic 606 on contract liabilities and accumulated deficit balances as of January 1, 2019 was as follows (in thousands): December 31, 2018 Adjustment Due to the Adoption of Topic 606 January 1, 2019 Current portion of deferred revenue $ 6,250 $ 750 $ 7,000 Long-term portion of deferred revenue 16,984 (2,962 ) 14,022 Accumulated deficit $ (122,828 ) $ 2,212 $ (120,616 ) The impact of the adoption of Topic 606 on the Company’s Consolidated Balance Sheet and Statement of Operations as of and for the period ended December 31, 2019 was as follows (in thousands): As of December 31, 2019 As Reported Balances without the Adoption of Topic 606 Effect of Adoption Higher/ (Lower) Current portion of deferred revenue $ 7,000 $ 7,917 $ (917 ) Long-term portion of deferred revenue 12,022 13,594 (1,572 ) Accumulated deficit $ - $ - $ (2,489 ) Year ended December 31, 2019 As Reported Without the Adoption of Topic 606 Effect of Adoption Higher/ (Lower) Collaboration and license revenue $ 15,000 $ 14,722 $ 278 Net loss (84,710 ) (84,988 ) 278 Net loss per share, basic and diluted $ (1.93 ) $ (1.94 ) $ 0.01 |
ASU 2016-18 | |
Significant Accounting Policies [Line Items] | |
Impact of Adoption | In November 2016, the FASB issued ASU No. 2016-18 (Topic 230), Restricted Cash, Statement of Cash Flows (ASU 2016-18) The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amount shown on the consolidated statements of cash flows (in thousands): December 31, 2019 December 31, 2018 Cash and cash equivalents $ 57,937 $ 71,064 Restricted cash 203 203 Cash, cash equivalents and restricted cash $ 58,140 $ 71,267 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments (Excluding Restricted Cash) Measured at Fair Value on Recurring Basis | The following tables set forth the Company’s financial instruments (excluding restricted cash) that were measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): December 31, 2019 Total Level 1 Level 2 Level 3 Money market funds $ 45,498 $ 45,498 $ - $ - U.S. government agency obligations 74,854 - 74,854 - Corporate securities and commercial paper 67,918 - 67,918 - Total assets measured at fair value $ 188,270 $ 45,498 $ 142,772 $ - December 31, 2018 Total Level 1 Level 2 Level 3 Money market funds $ 45,017 $ 45,017 $ - $ - U.S. government agency obligations 103,940 - 103,940 - Corporate securities and commercial paper 110,768 - 110,768 - Total assets measured at fair value $ 259,725 $ 45,017 $ 214,708 $ - |
Schedule of Investments Classified as Available for Sale Securities with Contractual Maturities | Classified as (with contractual maturities): Year Ended December 31, 2019 2018 Cash and cash equivalents $ 57,937 $ 71,064 Short-term investments (due within one year) 130,333 185,480 Long-term investments (due between one and two years) - 3,181 $ 188,270 $ 259,725 |
Schedule of Fair Value and Amortized Cost of Investments in Marketable Securities by Major Security Type | The fair value and amortized cost of investments in marketable securities by major security type as of December 31, 2019 and 2018 are presented in the tables that follow (in thousands): Amortized Cost Unrealized Gain Unrealized Loss Fair Value As of December 31, 2019: Money market funds $ 45,498 $ - $ - $ 45,498 U.S. government agency obligations 74,801 12 (1 ) 74,812 Corporate securities and commercial paper 67,907 55 (2 ) 67,960 Total $ 188,206 $ 67 $ (3 ) $ 188,270 Amortized Cost Unrealized Gain Unrealized Loss Fair Value As of December 31, 2018: Money market funds $ 45,017 $ - $ - $ 45,017 U.S. government agency obligations 103,957 - (17 ) 103,940 Corporate securities and commercial paper 110,859 - (91 ) 110,768 Total $ 259,833 $ - $ (108 ) $ 259,725 |
Consolidated Balance Sheet Co_2
Consolidated Balance Sheet Components (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Balance Sheet Related Disclosures [Abstract] | |
Summary of Property and Equipment, Net | Property and equipment, net consisted of the following (in thousands): As of December 31, 2019 2018 Scientific equipment $ 8,168 $ 6,628 Furniture and equipment 1,165 813 Capitalized software 146 146 Leasehold improvements 10,834 10,828 Construction in progress 238 335 Total 20,551 18,750 Less: Accumulated depreciation and amortization (11,221 ) (7,643 ) Property and equipment, net $ 9,330 $ 11,107 |
Summary of Accrued Liabilities | Accrued liabilities consisted of the following (in thousands): As of December 31, 2019 2018 Accrued personnel expenses $ 4,571 $ 2,833 Accrued research and development expenses 4,572 2,816 Professional fees 183 211 Other 196 163 Total accrued liabilities $ 9,522 $ 6,023 |
License and Collaboration Agr_2
License and Collaboration Agreements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
License And Collaboration Agreements [Abstract] | |
Summary of Revenue Recognized as a Result of Changes in Deferred Revenue | The Company recognized the following revenue as a result of changes in the deferred revenue balance during the period below (in thousands): Year Ended December 31, Revenue recognized in the period from: 2019 Amounts included in deferred revenue at the beginning of the period $ 7,000 Performance obligations satisfied in previous period $ - |
Convertible Preferred Stock a_2
Convertible Preferred Stock and Stockholders’ Equity (Deficit) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders Equity Note [Abstract] | |
Schedule of Reserved Common Stock on an if-Converted Basis for Issuance | As of December 31, 2019 and 2018, the Company had reserved common stock, on an if-converted basis, for issuance as follows: As of December 31, 2019 2018 Common stock options issued and outstanding 4,738,004 1,458,080 Remaining shares available for issuance under 2015 & 2018 Stock Plan 2,315,099 3,801,191 Unvested restricted stock issued as part of collaboration agreement 1,257,651 - Total 8,310,754 5,259,271 |
Stock Plan and Stock-Based Co_2
Stock Plan and Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Option Activity Includes Options Granted | The following table, which includes options granted under the 2015 Plan, 2018 Plan and the Non-Plan Option, summarizes option activity: Shares Subject to Outstanding Options Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2018 1,458,080 $ 7.55 Options granted 3,967,746 $ 9.66 Options exercised (41,762 ) $ 4.85 Options forfeited or canceled (646,060 ) $ 10.01 Outstanding at December 31, 2019 4,738,004 $ 9.00 8.83 $ 8,174 Options vested and expected to vest as of December 31, 2019 4,738,004 $ 9.00 8.83 $ 8,174 Options exercisable as of December 31, 2019 1,145,303 $ 8.52 7.97 $ 2,851 |
Summary of Non-Vested Restricted Stock | A summary of the Company’s non-vested restricted stock for the periods presented is as follows: Number of Shares Weighted Average Grant Date Fair Value Remaining Contractual Term (Years) Balance, December 31, 2018 289,352 $ 0.000396 0.4 Vested during the year 289,352 $ 0.000396 Balance, December 31, 2019 - $ - - |
Summary of Employee and Non-Employee Stock-based Compensation Expense | The following table summarizes employee and non-employee stock-based compensation expense for the years ended December 31, 2019 and 2018, and also the allocation within the consolidated statements of operations and comprehensive loss (in thousands): Year Ended December 31, 2019 2018 Research and development $ 4,152 $ 2,255 General and administrative 4,829 1,619 Total stock-based compensation $ 8,981 $ 3,874 |
Schedule of Assumptions Used to Calculate Fair Value of Stock-Based Compensation | The following assumptions were used to calculate the fair value of stock-based compensation for the years ended December 31, 2019, and 2018: Stock Options ESPP Year Ended December 31, Year Ended December 31, 2019 2018 2019 2018 Risk-free interest rate 1.6% - 2.3% 1.2% - 3.1% 1.6% - 2.3% 2.1% - 2.6% Expected term (in years) 6.02 5.16-9.95 0.5-2.0 0.5-2.0 Volatility 71.8% - 74.6% 58.7%-75.5% 64.8% - 77.1% 54.3% - 65.5% Dividend yield 0% 0% 0% 0% |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss Per Share | The following table sets forth the computation of basic and diluted net loss per share (in thousands, except share and per share data): Year Ended December 31, 2019 2018 Numerator: Net loss $ (84,710 ) $ (49,594 ) Denominator: Weighted-average common shares outstanding 45,385,489 36,357,336 Less: weighted-average common shares subject to repurchase (1,559,498 ) (1,739,099 ) Weighted-average common shares used to compute basic and diluted net loss per share 43,825,991 34,618,237 Net loss per share, basic and diluted $ (1.93 ) $ (1.43 ) |
Summary of Outstanding Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss per Share | The following outstanding potentially dilutive securities were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive: At December 31, 2019 2018 Common stock options issued and outstanding 4,738,004 1,458,079 Unvested early exercised common stock options 455,158 927,123 Unvested restricted stock issued as part of collaboration agreement 1,257,651 - Unvested restricted common stock - 289,352 Total 6,450,813 2,674,554 |
Provision for Income Taxes (Tab
Provision for Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Provision for Income Taxes Differs from Amount Expected by Applying Federal Statutory Rate to Loss Before Taxes | The provision for income taxes differs from the amount expected by applying the federal statutory rate to the loss before taxes as follows: Year Ended December 31, 2019 2018 Federal statutory income tax rate 21.00 % 21.00 % Non-deductible expenses and other (1.35 )% (1.54 )% Change in valuation allowance (19.65 )% (19.46 )% Total 0.00 % 0.00 % |
Schedule of Components of Deferred Tax Assets | As of December 31, 2019 and 2018, the components of the Company’s deferred tax assets are as follows (in thousands): Year Ended December 31, 2019 2018 Deferred tax assets: Federal and state net operating loss carryforwards $ 30,049 $ 16,076 Research and development credits carryforwards 8,077 5,087 Depreciation 6,052 3,942 Deferred Revenue 3,277 3,909 Other 2,965 1,724 Total deferred tax assets 50,420 30,738 Less valuation allowance (50,420 ) (30,738 ) Net deferred tax assets $ - $ - |
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Year Ended December 31, 2019 2018 Beginning balance $ 1,084 $ 622 Additions (decreases) for tax positions taken in a prior year (7 ) 8 Additions for tax positions taken in current year 1,088 454 Ending balance $ 2,165 $ 1,084 |
Commitments (Tables)
Commitments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Summary of Future Minimum Lease Payments under Non-cancelable Operating Leases | Future minimum lease payments under non-cancelable operating leases as of December 31, 2019 are as follows (in thousands): Year ending December 31: Operating Leases 2020 $ 2,105 2021 2,195 2022 2,265 2023 2,339 2024 2,415 2025 2,072 Total $ 13,391 |
Selected Unaudited Quarterly _2
Selected Unaudited Quarterly Financial Data (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of Unaudited Quarterly Financial Data | The following table summarizes the Company’s unaudited quarterly financial data for the last two years (in thousands, except per share data): First Quarter Second Quarter Third Quarter Fourth Quarter 2019 Total revenues $ 1,750 $ 1,750 $ 1,750 $ 9,750 Total operating expenses $ 20,523 $ 30,910 $ 24,999 $ 27,277 Net loss $ (17,670 ) $ (28,090 ) $ (22,352 ) $ (16,598 ) Net loss per share — basic and diluted $ (0.41 ) $ (0.64 ) $ (0.51 ) $ (0.38 ) Weighted average number of shares, basic and diluted 43,508,592 43,797,718 43,939,281 44,056,407 2018 Total revenues $ 1,250 $ 1,250 $ 4,291 $ 1,562 Total operating expenses $ 14,581 $ 17,149 $ 16,436 $ 15,046 Net loss $ (12,954 ) $ (13,533 ) $ (10,812 ) $ (12,295 ) Net loss per share — basic and diluted $ (1.37 ) $ (0.32 ) $ (0.25 ) $ (0.28 ) Weighted average number of shares, basic and diluted 9,488,352 42,533,641 42,838,098 43,163,412 |
Organization - Additional Infor
Organization - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 21, 2018 | Dec. 31, 2019 | Dec. 31, 2018 |
Class Of Stock [Line Items] | |||
Net proceeds from issuance of common stock excluding underwriting costs and other offering related costs | $ 1,217 | $ 4,098 | |
Common stock, shares authorized | 400,000,000 | 400,000,000 | 400,000,000 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common Stock | |||
Class Of Stock [Line Items] | |||
Common stock issued | 9,200,000 | ||
IPO | |||
Class Of Stock [Line Items] | |||
Common stock issued | 9,200,000 | ||
Common stock offering price | $ 15 | ||
Net proceeds from issuance of common stock excluding underwriting costs and other offering related costs | $ 124,700 | ||
IPO | Common Stock | |||
Class Of Stock [Line Items] | |||
Convertible preferred stock converted into common stock | 30,459,574 | ||
Overallotment | |||
Class Of Stock [Line Items] | |||
Common stock issued | 1,200,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Detail) | Mar. 09, 2018 | Oct. 31, 2017USD ($) | Dec. 31, 2019USD ($)Segment | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jan. 01, 2019USD ($) |
Significant Accounting Policies [Line Items] | ||||||
Reverse stock split | the Company effected a reverse split of all shares of its common and preferred stock at a ratio of 1-for-3.96 | |||||
Reverse stock split ratio | 0.2525 | |||||
Number of operating segments | Segment | 1 | |||||
Number of reportable segments | Segment | 1 | |||||
Accumulated deficit | $ (205,326,000) | $ (122,828,000) | ||||
Minimum | ||||||
Significant Accounting Policies [Line Items] | ||||||
Property and equipment, estimated useful lives | 1 year | |||||
Impairment charges | $ 0 | 0 | ||||
Maximum | ||||||
Significant Accounting Policies [Line Items] | ||||||
Property and equipment, estimated useful lives | 5 years | |||||
Taiho Agreement | Taiho Pharmaceutical Co Ltd | ||||||
Significant Accounting Policies [Line Items] | ||||||
Accumulated deficit | 2,200,000 | |||||
Non-refundable upfront research and development fees term | 5 years | |||||
Transaction price | $ 35,000,000 | |||||
Non refundable and non creditable upfront cash payment received | $ 35,000,000 | |||||
Payment received for license agreement | $ 5,000,000 | 5,000,000 | 5,000,000 | $ 25,000,000 | ||
Additional payment to be received for license agreement | $ 5,000,000 | 5,000,000 | ||||
Net reduction to deferred revenue | $ 2,200,000 | |||||
Estimated performance period | 5 years | 4 years | 5 years | |||
Before Adoption of Topic 606 | ||||||
Significant Accounting Policies [Line Items] | ||||||
Accumulated deficit | $ (122,828,000) | |||||
Before Adoption of Topic 606 | Taiho Agreement | Taiho Pharmaceutical Co Ltd | ||||||
Significant Accounting Policies [Line Items] | ||||||
Additional payment to be received for license agreement | $ 5,000,000 | |||||
Non-refundable, non-creditable cash payment received | $ 25,000,000 | |||||
ASC 606 | ||||||
Significant Accounting Policies [Line Items] | ||||||
Accumulated deficit | (120,616,000) | |||||
Non-refundable upfront research and development fees term | 5 years | |||||
ASC 606 | Adjustment due to The Adoption of Topic 606 | ||||||
Significant Accounting Policies [Line Items] | ||||||
Accumulated deficit | $ 2,212,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Summary of Impact of Adoption of Topic 606 on Contract Liabilities and Accumulated Deficit (Detail) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Significant Accounting Policies [Line Items] | |||
Current portion of deferred revenue | $ 7,000 | ||
Long-term portion of deferred revenue | 12,022 | ||
Accumulated deficit | (205,326) | $ (122,828) | |
Before Adoption of Topic 606 | |||
Significant Accounting Policies [Line Items] | |||
Current portion of deferred revenue | 7,917 | 6,250 | |
Long-term portion of deferred revenue | $ 13,594 | 16,984 | |
Accumulated deficit | $ (122,828) | ||
ASC 606 | |||
Significant Accounting Policies [Line Items] | |||
Current portion of deferred revenue | $ 7,000 | ||
Long-term portion of deferred revenue | 14,022 | ||
Accumulated deficit | (120,616) | ||
ASC 606 | Adjustment due to The Adoption of Topic 606 | |||
Significant Accounting Policies [Line Items] | |||
Current portion of deferred revenue | 750 | ||
Long-term portion of deferred revenue | (2,962) | ||
Accumulated deficit | $ 2,212 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Summary of Impact of Adoption of Topic 606 on Consolidated Balance Sheet and Statement of Operations (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Significant Accounting Policies [Line Items] | |||
Current portion of deferred revenue | $ 7,000 | ||
Long-term portion of deferred revenue | 12,022 | ||
Accumulated deficit | (205,326) | $ (122,828) | |
Balances Without the Adoption of Topic 606 | |||
Significant Accounting Policies [Line Items] | |||
Current portion of deferred revenue | 7,917 | 6,250 | |
Long-term portion of deferred revenue | 13,594 | 16,984 | |
Accumulated deficit | $ (122,828) | ||
ASC 606 | |||
Significant Accounting Policies [Line Items] | |||
Current portion of deferred revenue | $ 7,000 | ||
Long-term portion of deferred revenue | 14,022 | ||
Accumulated deficit | $ (120,616) | ||
ASC 606 | Effect of Adoption Higher/ (Lower) | |||
Significant Accounting Policies [Line Items] | |||
Current portion of deferred revenue | (917) | ||
Long-term portion of deferred revenue | (1,572) | ||
Accumulated deficit | $ (2,489) |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Summary of Impact of Adoption of Topic 606 on Condensed Consolidated Balance Sheet and Statement of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Significant Accounting Policies [Line Items] | ||||||||||
Collaboration and license revenue | $ 15,000 | |||||||||
Net loss | $ (16,598) | $ (22,352) | $ (28,090) | $ (17,670) | $ (12,295) | $ (10,812) | $ (13,533) | $ (12,954) | $ (84,710) | $ (49,594) |
Net loss per share, basic and diluted | $ (1.93) | $ (1.43) | ||||||||
Balances Without the Adoption of Topic 606 | ||||||||||
Significant Accounting Policies [Line Items] | ||||||||||
Collaboration and license revenue | $ 14,722 | |||||||||
Net loss | $ (84,988) | |||||||||
Net loss per share, basic and diluted | $ (1.94) | |||||||||
ASC 606 | Effect of Adoption Higher/ (Lower) | ||||||||||
Significant Accounting Policies [Line Items] | ||||||||||
Collaboration and license revenue | $ 278 | |||||||||
Net loss | $ 278 | |||||||||
Net loss per share, basic and diluted | $ 0.01 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Summary of Cash After Implementing ASU 2016-18 (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Significant Accounting Policies [Line Items] | ||
Cash and cash equivalents | $ 57,937 | $ 71,064 |
Restricted cash | 203 | 203 |
ASU 2016-18 | ||
Significant Accounting Policies [Line Items] | ||
Cash and cash equivalents | 57,937 | 71,064 |
Restricted cash | 203 | 203 |
Cash, cash equivalents and restricted cash | $ 58,140 | $ 71,267 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | ||
Fair value assets transferred from level 1 to level 2 | $ 0 | $ 0 |
Fair value assets transferred from level 2 to level 1 | 0 | 0 |
Fair value liabilities transferred from level 1 to level 2 | 0 | 0 |
Fair value liabilities transferred from level 2 to level 1 | 0 | 0 |
Fair value assets transferred into level 3 | 0 | 0 |
Fair value assets transferred out of level 3 | 0 | 0 |
Fair value liabilities transferred into level 3 | 0 | 0 |
Fair value liabilities transferred out of level 3 | 0 | 0 |
Realized gains (loss) on sale or maturity of available-for-sale marketable securities | 0 | 0 |
Reclassification out of accumulated other comprehensive loss | $ 0 | $ 0 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Instruments (Excluding Restricted Cash) Measured at Fair Value on Recurring Basis (Details) - Fair Value On Recurring Basis - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | $ 188,270 | $ 259,725 |
Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 45,498 | 45,017 |
U.S. Government Agency Obligations | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 74,854 | 103,940 |
Corporate Securities and Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 67,918 | 110,768 |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 45,498 | 45,017 |
Level 1 | Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 45,498 | 45,017 |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 142,772 | 214,708 |
Level 2 | U.S. Government Agency Obligations | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 74,854 | 103,940 |
Level 2 | Corporate Securities and Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | $ 67,918 | $ 110,768 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Investments Classified as Available for Sale Securities with Contractual Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value Disclosures [Abstract] | ||
Cash and cash equivalents | $ 57,937 | $ 71,064 |
Short-term investments (due within one year) | 130,333 | 185,480 |
Long-term investments (due between one and two years) | 3,181 | |
Total cash and investments in marketable securities | $ 188,270 | $ 259,725 |
Fair Value Measurements - Sch_3
Fair Value Measurements - Schedule of Fair Value and Amortized Cost of Investments in Marketable Securities by Major Security Type (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Amortized Cost | $ 188,206 | $ 259,833 |
Unrealized Gain | 67 | |
Unrealized Loss | (3) | (108) |
Fair Value | 188,270 | 259,725 |
Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Amortized Cost | 45,498 | 45,017 |
Fair Value | 45,498 | 45,017 |
U.S. Government Agency Obligations | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Amortized Cost | 74,801 | 103,957 |
Unrealized Gain | 12 | |
Unrealized Loss | (1) | (17) |
Fair Value | 74,812 | 103,940 |
Corporate Securities and Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Amortized Cost | 67,907 | 110,859 |
Unrealized Gain | 55 | |
Unrealized Loss | (2) | (91) |
Fair Value | $ 67,960 | $ 110,768 |
Consolidated Balance Sheet Co_3
Consolidated Balance Sheet Components - Summary of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Property Plant And Equipment [Line Items] | ||
Total | $ 20,551 | $ 18,750 |
Less: Accumulated depreciation and amortization | (11,221) | (7,643) |
Property and equipment, net | 9,330 | 11,107 |
Scientific Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total | 8,168 | 6,628 |
Furniture and Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total | 1,165 | 813 |
Capitalized Software | ||
Property Plant And Equipment [Line Items] | ||
Total | 146 | 146 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Total | 10,834 | 10,828 |
Construction in Progress | ||
Property Plant And Equipment [Line Items] | ||
Total | $ 238 | $ 335 |
Consolidated Balance Sheet Co_4
Consolidated Balance Sheet Components - Summary of Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accrued Liabilities Current [Abstract] | ||
Accrued personnel expenses | $ 4,571 | $ 2,833 |
Accrued research and development expenses | 4,572 | 2,816 |
Professional fees | 183 | 211 |
Other | 196 | 163 |
Total accrued liabilities | $ 9,522 | $ 6,023 |
Equity Investment in PACT Pha_2
Equity Investment in PACT Pharma - Additional Information (Details) - USD ($) shares in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2016 | |
Schedule of Equity Method Investments [Line Items] | |||
Loss from equity method investments | $ 1,202,000 | $ 886,000 | |
Equity investment in related party | 1,202,000 | ||
PACT Pharma | |||
Schedule of Equity Method Investments [Line Items] | |||
Loss from equity method investments | 1,200,000 | $ 900,000 | |
Equity investment in related party | 0 | ||
Unrealized loss on equity method investments | $ 800,000 | ||
PACT Pharma | Series A Preferred Stock | |||
Schedule of Equity Method Investments [Line Items] | |||
Purchase of common stock, shares | 1 | ||
PACT Pharma | Common Stock | |||
Schedule of Equity Method Investments [Line Items] | |||
Purchase of common stock, shares | 3.6 |
License and Collaboration Agr_3
License and Collaboration Agreements - Additional Information (Details) | Apr. 30, 2019USD ($)shares | Oct. 31, 2017USD ($) | Sep. 30, 2017USD ($)Program | Aug. 31, 2017USD ($) | Dec. 31, 2019USD ($)shares | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
License And Collaboration Agreements [Line Items] | |||||||
Revenue recognized | $ 7,000,000 | ||||||
Deferred revenue, current | 7,000,000 | $ 6,250,000 | |||||
Deferred revenue, noncurrent | 12,022,000 | 16,984,000 | |||||
Research and development | $ 78,481,000 | 49,646,000 | |||||
Shares probable of vesting | shares | 4,738,004 | ||||||
Taiho Pharmaceutical Co Ltd | Taiho Agreement | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Option period | 5 years | ||||||
Non refundable and non creditable cash payments | $ 35,000,000 | ||||||
Payment received for license agreement | $ 5,000,000 | $ 5,000,000 | $ 5,000,000 | $ 25,000,000 | |||
Range of royalties receivable on net sales | high single-digits to mid-teens | ||||||
Royalties payable description | Royalties will be payable on a licensed product-by-licensed product and country-by-country basis during the period of time commencing on the first commercial sale of a licensed product in a country and ending upon the later of: (a) ten (10) years from the date of first commercial sale of such licensed product in such country; and (b) expiration of the last-to-expire valid claim of the Company’s patents covering the manufacture, use or sale or exploitation of such licensed product in such country (the Royalty Term) | ||||||
Upfront cash payment | $ 20,000,000 | ||||||
Non-refundable, non-creditable upfront cash payments | $ 35,000,000 | ||||||
Estimated performance period | 5 years | 4 years | 5 years | ||||
Payment for first option exercise | $ 8,000,000 | $ 3,000,000 | |||||
Licensing revenue recognized | 8,000,000 | ||||||
Clinical and regulatory milestones achieved | 0 | ||||||
Sales milestone or royalty revenue recognized | 0 | ||||||
Revenue recognized | 15,000,000 | 8,300,000 | |||||
Deferred revenue, current | 7,000,000 | ||||||
Deferred revenue, noncurrent | $ 12,000,000 | ||||||
Taiho Pharmaceutical Co Ltd | Taiho Agreement | Minimum | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Number of programs, IND enabling studies not initiated | Program | 5 | ||||||
Payment for option exercise | $ 3,000,000 | ||||||
Taiho Pharmaceutical Co Ltd | Taiho Agreement | Maximum | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Extended option agreement period | 7 years | ||||||
Payment for option exercise | $ 15,000,000 | ||||||
Additional clinical and regulatory milestone payments receivable | 130,000,000 | ||||||
Contingent payments receivable | $ 145,000,000 | ||||||
WuXi Biologics License Agreement | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Range of tiered royalty payments on net sales | high single-digits to low teens | ||||||
WuXi Biologics License Agreement | Research and Development Expenses | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Milestone payments | $ 7,500,000 | 0 | |||||
Sub-license fees | 1,200,000 | ||||||
WuXi Biologics License Agreement | Maximum | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Clinical, regulatory and commercialization milestone payments | $ 375,000,000 | ||||||
Abmuno License Agreement | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Milestone payments | 0 | ||||||
Abmuno License Agreement | Research and Development Expenses | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Milestone payments | $ 2,800,000 | ||||||
Abmuno License Agreement | Maximum | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Clinical, regulatory and commercialization remaining milestone payments | 101,000,000 | ||||||
Genentech | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Research and development | 0 | ||||||
Strata Oncology Inc | Co-Development and Collaboration Agreement | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Development milestone payable | $ 2,500,000 | ||||||
Development cost recorded within research and development expenses | 1,000,000 | ||||||
Development cost reimbursed | $ 200,000 | ||||||
Number of restricted shares of common stock issued | shares | 1,257,651 | ||||||
Fair value of restricted shares of common stock issued | $ 15,000,000 | ||||||
Strata Oncology Inc | Co-Development and Collaboration Agreement | Non-vested Restricted Stock | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Shares probable of vesting | shares | 0 | ||||||
Compensation expense recognized | $ 0 | ||||||
Strata Oncology Inc | Co-Development and Collaboration Agreement | Research and Development Expenses | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Milestone payments | $ 2,500,000 | ||||||
Strata Oncology Inc | Co-Development and Collaboration Agreement | Maximum | |||||||
License And Collaboration Agreements [Line Items] | |||||||
Regulatory and commercial milestone payable | $ 125,000,000 |
License and Collaboration Agr_4
License and Collaboration Agreements - Summary of Revenue Recognized as a Result of Changes in Deferred Revenue (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
License And Collaboration Agreements [Abstract] | |
Amounts included in deferred revenue at the beginning of the period | $ 7,000 |
Convertible Preferred Stock a_3
Convertible Preferred Stock and Stockholders' Equity (Deficit) - Additional information (Details) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 | Mar. 21, 2018 | Dec. 31, 2017 |
Class Of Stock [Line Items] | ||||
Capital stock shares authorized | 410,000,000 | |||
Common stock, shares authorized | 400,000,000 | 400,000,000 | 400,000,000 | |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | |
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Preferred stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Common Stock | IPO | ||||
Class Of Stock [Line Items] | ||||
Convertible preferred stock converted into common stock | 30,459,574 | |||
Convertible Preferred Stock | ||||
Class Of Stock [Line Items] | ||||
Convertible preferred stock, shares outstanding | 0 | 0 | 30,459,574 |
Convertible Preferred Stock a_4
Convertible Preferred Stock and Stockholders' Equity (Deficit) - Schedule of Reserved Common Stock on an if-Converted Basis for Issuance (Details) - shares | Dec. 31, 2019 | Dec. 31, 2018 |
Class Of Stock [Line Items] | ||
Total shares of authorized common stock reserved for future issuance | 8,310,754 | 5,259,271 |
Common Stock Options Issued and Outstanding | ||
Class Of Stock [Line Items] | ||
Total shares of authorized common stock reserved for future issuance | 4,738,004 | 1,458,080 |
Remaining Shares Available for Issuance under 2015 & 2018 Stock Plan | ||
Class Of Stock [Line Items] | ||
Total shares of authorized common stock reserved for future issuance | 2,315,099 | 3,801,191 |
Unvested Restricted Stock Issued as Part of Collaboration Agreement | ||
Class Of Stock [Line Items] | ||
Total shares of authorized common stock reserved for future issuance | 1,257,651 |
Stock Plan and Stock-Based Co_3
Stock Plan and Stock-Based Compensation - Additional Information (Details) - USD ($) | Jan. 01, 2020 | Jan. 01, 2019 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2015 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Unrecognized employee compensation costs | $ 23,700,000 | |||||
Non-vested stock option recognized weighted average period | 2 years 10 months 24 days | |||||
Intrinsic value of shares exercised | $ 200,000 | $ 600,000 | ||||
Fair value of shares vested | $ 7,800,000 | $ 3,000,000 | ||||
Total shares of authorized common stock reserved for future issuance | 8,310,754 | 5,259,271 | ||||
Common stock, shares outstanding | 45,925,004 | 44,537,946 | ||||
Share-based compensation, vested stock options | 372,774 | 14,918 | ||||
Description of expected term simplified method | The Company has opted to use the “simplified method” for estimating the expected term of options, whereby the expected term equals the arithmetic average of the vesting term and the original contractual term of the option (generally 10 years). | |||||
Expected term | 10 years | |||||
Expected dividend yield | 0.00% | |||||
Non-Employee Stock-Based Compensation | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares not vested and subject to repurchase | 308,596 | 31,388 | ||||
Stock based compensation expense | $ 900,000 | $ 300,000 | ||||
Restricted Stock Agreements | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Award vesting period | 4 years | |||||
Estimated fair value, price per share | $ 0.0004 | |||||
Vesting interval period | monthly | |||||
Chief Executive Officer and President | Restricted Stock Agreements | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares issued | 2,777,776 | |||||
Price per share | $ 0.0004 | |||||
2018 Equity Incentive Plan | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of shares issued or transferred | 3,570,000 | |||||
Total shares of authorized common stock reserved for future issuance | 2,315,099 | |||||
2018 Equity Incentive Plan | Maximum | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares of common stock reserved for issuance under evergreen provision | 3,570,000 | |||||
Percentage of common stock outstanding | 4.00% | |||||
2018 Equity Incentive Plan | Subsequent Event | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares of common stock reserved for issuance under evergreen provision | 1,837,000 | |||||
2015 Stock Plan | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares not vested and subject to repurchase | 455,158 | 927,123 | ||||
Cash received from early exercise of unvested options | $ 1,700,000 | $ 2,800,000 | ||||
Award vesting period | 48 months | |||||
Total shares of authorized common stock reserved for future issuance | 709,558 | |||||
2018 Employee Stock Purchase Plan | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Purchase date of fair market value trading days | 24 months | |||||
Total shares of authorized common stock reserved for future issuance | 714,000 | 933,273 | ||||
2018 Employee Stock Purchase Plan | Maximum | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Purchase price of common stock as percentage of market value | 85.00% | |||||
Number of shares of common stock that may be purchased by an employee on any purchase date | 3,000 | |||||
Number of shares that may be purchased in any calendar year | $ 25,000 | |||||
Percentage of common stock shares outstanding | 1.00% | |||||
Common stock, shares outstanding | 1,071,000 | |||||
2018 Employee Stock Purchase Plan | Subsequent Event | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares of common stock reserved for issuance under evergreen provision | 459,250 |
Stock Plan and Stock-Based Co_4
Stock Plan and Stock-Based Compensation - Summary of Options Granted (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($)$ / sharesshares | |
Shares Subject to Outstanding Options | |
Begining balance | shares | 1,458,080 |
Options granted | shares | 3,967,746 |
Options exercised | shares | (41,762) |
Options forfeited or canceled | shares | (646,060) |
Ending balance | shares | 4,738,004 |
Options vested and expected to vest as of December 31, 2019 | shares | 4,738,004 |
Options exercisable as of December 31, 2019 | shares | 1,145,303 |
Weighted Average Exercise Price Per Share | |
Begining balance | $ / shares | $ 7.55 |
Options granted | $ / shares | 9.66 |
Options exercised | $ / shares | 4.85 |
Options forfeited or canceled | $ / shares | 10.01 |
Ending balance | $ / shares | 9 |
Options vested and expected to vest as of December 31, 2019 | $ / shares | 9 |
Options exercisable as of December 31, 2019 | $ / shares | $ 8.52 |
Weighted Average Remaining Contractual Term (in years) | 8 years 9 months 29 days |
Options vested and expected to vest, Weighted Average Remaining Contractual Term (in years) | 8 years 9 months 29 days |
Options exercisable, Weighted Average Remaining Contractual Term (in years) | 7 years 11 months 19 days |
Aggregate Intrinsic Value | $ | $ 8,174 |
Options vested and expected to vest, Aggregate Intrinsic Value | $ | 8,174 |
Options exercisable, Aggregate Intrinsic Value | $ | $ 2,851 |
Stock Plan and Stock-Based Co_5
Stock Plan and Stock-Based Compensation - Summary of Non-Vested Restricted Stock (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Remaining Contractual Term (Years) | 8 years 9 months 29 days | |
Non-vested Restricted Stock | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Beginning balance, Number of Shares | 289,352 | |
Vested during the year, Number of Shares | 289,352 | |
Ending balance, Number of Shares | 289,352 | |
Beginning balance, Weighted Average Grant Date Fair Value | $ 0.000396 | |
Vested during the year, Weighted Average Grant Date Fair Value | $ 0.000396 | |
Ending balance, Weighted Average Grant Date Fair Value | $ 0.000396 | |
Remaining Contractual Term (Years) | 4 months 24 days |
Stock Plan and Stock-Based Co_6
Stock Plan and Stock-Based Compensation - Summary of Stock-Based Compensation Expense (Details) - Employee And Non Employee - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation | $ 8,981 | $ 3,874 |
Research and Development | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation | 4,152 | 2,255 |
General and Administrative | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation | $ 4,829 | $ 1,619 |
Stock Plan and Stock-Based Co_7
Stock Plan and Stock-Based Compensation - Assumptions used to Calculate Fair Value of Stock-Based Compensation (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Expected term (in years) | 10 years | |
Dividend yield | 0.00% | |
Employee Stock Option | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Risk-free interest rate, minimum | 1.60% | 1.20% |
Risk-free interest rate, maximum | 2.30% | 3.10% |
Expected term (in years) | 6 years 7 days | |
Volatility, minimum | 71.80% | 58.70% |
Volatility, maximum | 74.60% | 75.50% |
Dividend yield | 0.00% | 0.00% |
Employee stock purchase plan | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Risk-free interest rate, minimum | 1.60% | 2.10% |
Risk-free interest rate, maximum | 2.30% | 2.60% |
Volatility, minimum | 64.80% | 54.30% |
Volatility, maximum | 77.10% | 65.50% |
Dividend yield | 0.00% | 0.00% |
Minimum | Employee Stock Option | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Expected term (in years) | 5 years 1 month 28 days | |
Minimum | Employee stock purchase plan | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Expected term (in years) | 6 months | 6 months |
Maximum | Employee Stock Option | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Expected term (in years) | 9 years 11 months 12 days | |
Maximum | Employee stock purchase plan | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Expected term (in years) | 2 years | 2 years |
Net Loss per Share - Computatio
Net Loss per Share - Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator: | ||||||||||
Net loss | $ (16,598) | $ (22,352) | $ (28,090) | $ (17,670) | $ (12,295) | $ (10,812) | $ (13,533) | $ (12,954) | $ (84,710) | $ (49,594) |
Denominator: | ||||||||||
Weighted-average common shares outstanding | 45,385,489 | 36,357,336 | ||||||||
Less: weighted-average common shares subject to repurchase | (1,559,498) | (1,739,099) | ||||||||
Weighted-average number of shares used to compute basic and diluted net loss per share | 44,056,407 | 43,939,281 | 43,797,718 | 43,508,592 | 43,163,412 | 42,838,098 | 42,533,641 | 9,488,352 | 43,825,991 | 34,618,237 |
Net loss per share, basic and diluted | $ (1.93) | $ (1.43) |
Net Loss per Share - Summary of
Net Loss per Share - Summary of Outstanding Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss per Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 6,450,813 | 2,674,554 |
Common Stock Options Issued and Outstanding | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 4,738,004 | 1,458,079 |
Unvested Early Exercised Common Stock Options | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 455,158 | 927,123 |
Unvested Restricted Stock Issued as Part of Collaboration Agreement | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 1,257,651 | |
Unvested Restricted Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 289,352 |
Provision for Income Taxes - Sc
Provision for Income Taxes - Schedule of Provision for Income Taxes Differs from Amount Expected by Applying Federal Statutory Rate to Loss Before Taxes (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||
Federal statutory income tax rate | 21.00% | 21.00% |
Non-deductible expenses and other | (1.35%) | (1.54%) |
Change in valuation allowance | (19.65%) | (19.46%) |
Total | 0.00% | 0.00% |
Provision for Income Taxes - _2
Provision for Income Taxes - Schedule of Components of Deferred Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Federal and state net operating loss carryforwards | $ 30,049 | $ 16,076 |
Research and development credits carryforwards | 8,077 | 5,087 |
Depreciation | 6,052 | 3,942 |
Deferred Revenue | 3,277 | 3,909 |
Other | 2,965 | 1,724 |
Total deferred tax assets | 50,420 | 30,738 |
Less valuation allowance | $ (50,420) | $ (30,738) |
Provision for Income Taxes - Ad
Provision for Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes [Line Items] | |||
Valuation allowance increased value | $ 19,700,000 | $ 12,200,000 | |
Net operating loss carryforwards | 137,100,000 | ||
Interest or penalties accrued | 0 | 0 | |
Liability related to uncertain tax positions | 0 | ||
Reserve for unrecognized tax benefits | 2,165,000 | $ 1,084,000 | $ 622,000 |
Federal | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards | $ 47,400,000 | ||
Net operating loss carryforwards, expiration year | 2035 | ||
Net operating loss carryforwards amount with no expiration date | $ 89,700,000 | ||
Federal | Earliest Tax Year | U.S. | |||
Income Taxes [Line Items] | |||
Open tax year | 2015 | ||
Federal | Latest Tax Year | U.S. | |||
Income Taxes [Line Items] | |||
Open tax year | 2018 | ||
Federal | Research | |||
Income Taxes [Line Items] | |||
Research tax credits | $ 6,100,000 | ||
Research tax credits, expiration year | 2035 | ||
State | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards | $ 16,900,000 | ||
Net operating loss carryforwards, expiration year | 2035 | ||
State | Earliest Tax Year | California | |||
Income Taxes [Line Items] | |||
Open tax year | 2015 | ||
State | Latest Tax Year | California | |||
Income Taxes [Line Items] | |||
Open tax year | 2018 | ||
State | Research | |||
Income Taxes [Line Items] | |||
Research tax credits | $ 5,000,000 | ||
Foreign Tax Authority | Earliest Tax Year | Australian Taxation Office | |||
Income Taxes [Line Items] | |||
Open tax year | 2017 | ||
Foreign Tax Authority | Latest Tax Year | Australian Taxation Office | |||
Income Taxes [Line Items] | |||
Open tax year | 2018 |
Provision for Income Taxes - Re
Provision for Income Taxes - Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation Of Unrecognized Tax Benefits Excluding Amounts Pertaining To Examined Tax Returns Roll Forward | ||
Beginning balance | $ 1,084 | $ 622 |
Additions (decreases) for tax positions taken in a prior year | (7) | 8 |
Additions for tax positions taken in current year | 1,088 | 454 |
Ending balance | $ 2,165 | $ 1,084 |
Commitments - Additional Inform
Commitments - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | ||
Purchase commitments cancellation notice period | 30 days | |
Operating lease expiration year | 2025 | |
Rent expense | $ 1,600,000 | $ 1,600,000 |
Deposits for letters of credit | 200,000 | |
Minimum sublease rent income | 100,000 | |
Liabilities for Indemnification rights and agreements | $ 0 | $ 0 |
Commitments -Summary of Future
Commitments -Summary of Future Minimum Lease Payments under Non-Cancelable Operating Leases (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2020 | $ 2,105 |
2021 | 2,195 |
2022 | 2,265 |
2023 | 2,339 |
2024 | 2,415 |
2025 | 2,072 |
Total | $ 13,391 |
Employee Benefit Plan - Additio
Employee Benefit Plan - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Jan. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Defined contribution plan, percentage of employee compensation allowed to be contributed | 100.00% | ||
Defined contribution plan, cost | $ 0 | $ 0 | |
Common stock, shares issued | 45,925,004 | 44,537,946 | |
2020 Inducement Plan | Subsequent Event | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of shares issued or transferred | 3,000,000 | ||
Common stock, shares issued | 0 |
Selected Unaudited Quarterly _3
Selected Unaudited Quarterly Financial Data - Summary of Unaudited Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | ||||||||||
Total revenues | $ 9,750 | $ 1,750 | $ 1,750 | $ 1,750 | $ 1,562 | $ 4,291 | $ 1,250 | $ 1,250 | $ 15,000 | $ 8,353 |
Total operating expenses | 27,277 | 24,999 | 30,910 | 20,523 | 15,046 | 16,436 | 17,149 | 14,581 | 103,709 | 63,212 |
Net loss | $ (16,598) | $ (22,352) | $ (28,090) | $ (17,670) | $ (12,295) | $ (10,812) | $ (13,533) | $ (12,954) | $ (84,710) | $ (49,594) |
Net loss per share — basic and diluted | $ (0.38) | $ (0.51) | $ (0.64) | $ (0.41) | $ (0.28) | $ (0.25) | $ (0.32) | $ (1.37) | $ (1.93) | $ (1.43) |
Weighted-average number of shares used to compute basic and diluted net loss per share | 44,056,407 | 43,939,281 | 43,797,718 | 43,508,592 | 43,163,412 | 42,838,098 | 42,533,641 | 9,488,352 | 43,825,991 | 34,618,237 |