Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 28, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-39452 | ||
Entity Registrant Name | INHIBRX, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 82-4257312 | ||
Entity Address, Address Line One | 11025 N. Torrey Pines Road | ||
Entity Address, Address Line Two | Suite 200 | ||
Entity Address, City or Town | La Jolla | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 92037 | ||
City Area Code | (858) | ||
Local Phone Number | 795-4220 | ||
Title of 12(b) Security | Common Stock, par value $0.0001 | ||
Trading Symbol | INBX | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 331.2 | ||
Entity Common Stock, Shares Outstanding (in shares) | 43,572,060 | ||
Documents Incorporated by Reference | The following documents (or parts thereof) are incorporated by reference into the following parts of this Form 10-K: Certain information required in Part III of this Annual Report on Form 10-K is incorporated from the Registrant’s Proxy Statement for the 2023 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission. | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001739614 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Firm ID | 243 |
Auditor Name | BDO USA, LLP |
Auditor Location | San Diego, California |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 273,865 | $ 131,301 |
Accounts receivable | 243 | 373 |
Receivables from related parties | 14 | 505 |
Prepaid expenses and other current assets | 6,371 | 6,933 |
Total current assets | 280,493 | 139,112 |
Property and equipment, net | 2,501 | 3,153 |
Operating right-of-use asset | 4,717 | 6,338 |
Other non-current assets | 3,164 | 1,847 |
Total assets | 290,875 | 150,450 |
Current liabilities: | ||
Accounts payable | 8,326 | 9,125 |
Accrued expenses | 17,224 | 9,621 |
Current portion of deferred revenue | 166 | 2,034 |
Current portion of lease liability | 1,860 | 1,674 |
Total current liabilities | 27,576 | 22,454 |
Long-term debt, including final payment fee | 202,069 | 70,470 |
Non-current portion of lease liability | 3,173 | 5,033 |
Non-current portion of deferred revenue | 0 | 110 |
Total liabilities | 232,818 | 98,067 |
Commitments and contingencies (Note 10) | ||
Stockholders’ equity | ||
Preferred stock, $0.0001 par value, 15,000,000 shares authorized and no shares outstanding as of December 31, 2022 and December 31, 2021 | 0 | 0 |
Common stock, $0.0001 par value, 120,000,000 shares authorized as of December 31, 2022 and December 31, 2021; 43,564,283 and 38,991,307 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively | 4 | 4 |
Additional paid-in-capital | 430,426 | 279,526 |
Accumulated deficit | (372,373) | (227,147) |
Total stockholders’ equity | 58,057 | 52,383 |
Total liabilities and stockholders’ equity | $ 290,875 | $ 150,450 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 15,000,000 | 15,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 120,000,000 | 120,000,000 |
Common stock, shares issued (in shares) | 43,564,283 | 38,991,307 |
Common stock, shares outstanding (in shares) | 43,564,283 | 38,991,307 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue: | ||
Total revenue | $ 2,192 | $ 7,231 |
Operating expenses: | ||
Research and development | 110,186 | 71,440 |
General and administrative | 21,123 | 12,355 |
Total operating expenses | 131,309 | 83,795 |
Loss from operations | (129,117) | (76,564) |
Other income (expense): | ||
Interest expense, net | (16,107) | (5,216) |
Other income, net | 1 | 14 |
Total other expense | (16,106) | (5,202) |
Loss before provision for income taxes | (145,223) | (81,766) |
Provision for income taxes | 3 | 2 |
Net loss | $ (145,226) | $ (81,768) |
Net loss per share, basic (in dollars per share) | $ (3.62) | $ (2.15) |
Net loss per share, diluted (in dollars per share) | $ (3.62) | $ (2.15) |
Weighted-average shares of common stock outstanding, basic (in shares) | 40,108 | 38,010 |
Weighted-average shares of common stock outstanding, diluted (in shares) | 40,108 | 38,010 |
License fee revenue | ||
Revenue: | ||
Total revenue | $ 2,178 | $ 7,125 |
Grant revenue | ||
Revenue: | ||
Total revenue | $ 14 | $ 106 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders’ Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2020 | 37,712,000 | |||
Beginning balance at Dec. 31, 2020 | $ 75,473 | $ 4 | $ 220,848 | $ (145,379) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Stock-based compensation expense | 15,048 | 15,048 | ||
Issuance of shares upon exercise of stock options (in shares) | 358,000 | |||
Issuance of shares upon exercise of stock options | 3,956 | 3,956 | ||
Issuance of shares, net of issuance costs (in shares) | 921,000 | |||
Issuance of shares, net of issuance costs | 39,674 | 39,674 | ||
Net loss | $ (81,768) | (81,768) | ||
Ending balance (in shares) at Dec. 31, 2021 | 38,991,307 | 38,991,000 | ||
Ending balance at Dec. 31, 2021 | $ 52,383 | $ 4 | 279,526 | (227,147) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Stock-based compensation expense | $ 20,450 | 20,450 | ||
Issuance of shares upon exercise of stock options (in shares) | 241,000 | 241,000 | ||
Issuance of shares upon exercise of stock options | $ 2,757 | 2,757 | ||
Issuance of shares, net of issuance costs (in shares) | 4,332,000 | |||
Issuance of shares, net of issuance costs | 126,981 | 126,981 | ||
Issuance of warrants | 712 | 712 | ||
Net loss | $ (145,226) | (145,226) | ||
Ending balance (in shares) at Dec. 31, 2022 | 43,564,283 | 43,564,000 | ||
Ending balance at Dec. 31, 2022 | $ 58,057 | $ 4 | $ 430,426 | $ (372,373) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities | ||
Net loss | $ (145,226) | $ (81,768) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 1,225 | 1,195 |
Accretion of debt discount and non-cash interest expense | 3,448 | 1,234 |
Stock-based compensation expense | 20,450 | 15,048 |
Non-cash lease expense | 1,621 | 1,493 |
Gain or loss on disposal of fixed assets | 19 | (9) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 130 | (167) |
Receivables from related parties | 491 | 28 |
Prepaid expenses and other current assets | 612 | (4,040) |
Other non-current assets | (1,317) | (1,602) |
Accounts payable | (705) | (4,642) |
Accrued expenses and other current liabilities | 7,603 | (3,736) |
Operating lease liability | (1,674) | (1,503) |
Deferred revenue, current portion | (1,868) | (1,047) |
Deferred revenue, non-current portion | (110) | (627) |
Other non-current liabilities | 0 | (180) |
Net cash used in operating activities | (115,301) | (80,323) |
Cash flows from investing activities | ||
Purchase of fixed assets | (686) | (864) |
Proceeds from the sale of fixed assets | 0 | 55 |
Net cash used in investing activities | (686) | (809) |
Cash flows from financing activities | ||
Proceeds from the issuance of debt | 128,863 | 39,992 |
Payment of fees associated with debt | (50) | 0 |
Proceeds from exercise of stock options | 2,757 | 3,956 |
Net cash provided by financing activities | 258,551 | 83,769 |
Net increase in cash | 142,564 | 2,637 |
Cash and cash equivalents at beginning of period | 131,301 | 128,664 |
Cash and cash equivalents at end of period | 273,865 | 131,301 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | 13,090 | 3,889 |
Cash paid for income taxes | 4 | 2 |
Supplemental schedule of non-cash investing and financing activities | ||
Fair value of warrants issued to lender in conjunction with February 2022 Amendment | 712 | 0 |
ATM offering costs included in accounts payable | 0 | 271 |
ATM offering costs reimbursable in accounts receivable | 0 | 124 |
Payable for purchase of fixed assets | 0 | 94 |
ATM Offering | ||
Cash flows from financing activities | ||
Proceeds from ATM offering | 127,371 | 40,203 |
Costs associated with ATM offering | $ (390) | $ (382) |
ORGANIZATION AND SUMMARY OF SIG
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Inhibrx, Inc., or the Company, or Inhibrx, is a clinical-stage biopharmaceutical company focused on developing a broad pipeline of novel biologic therapeutic candidates. The Company combines target biology with protein engineering, technologies, and research and development to design therapeutic candidates. The Company’s current pipeline is focused on oncology and orphan diseases. The Company is subject to risks and uncertainties common to early-stage companies in the biopharmaceutical industry, including, but not limited to, risks associated with preclinical studies, clinical trials and regulatory applications, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations and the ability to secure additional capital to fund operations. The Company’s therapeutic candidates currently under development will require significant additional research and development efforts, including clinical and preclinical testing and marketing approval prior to commercialization. These efforts require significant amounts of capital, adequate personnel and infrastructure and extensive compliance-reporting capabilities. Even if the Company’s development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales. Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, or GAAP, and applicable rules and regulations of the Securities and Exchange Commission, or the SEC, related to an annual report on the Form 10-K. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary and have been prepared in conformity with GAAP. All intercompany accounts and transactions have been eliminated in consolidation. Liquidity As of December 31, 2022, the Company had an accumulated deficit of $372.4 million and cash and cash equivalents of $273.9 million. From its inception and through December 31, 2022, the Company has devoted substantially all of its efforts to therapeutic drug discovery and development, conducting preclinical studies and clinical trials, enabling manufacturing activities in support of its therapeutic candidates, organizing and staffing the Company, establishing its intellectual property portfolio and raising capital to support and expand these activities. The Company believes that its existing cash and cash equivalents will be sufficient to fund the Company’s operations for at least 12 months from the date these consolidated financial statements are issued. The Company plans to finance its future cash needs through equity offerings, debt financings or other capital sources, including potential collaborations, licenses, and other similar arrangements. If the Company does raise additional capital through public or private equity or convertible debt offerings, the ownership interests of its existing stockholders will be diluted, and the terms of those securities may include liquidation or other preferences that adversely affect its stockholders’ rights. If the Company raises capital through additional debt financings, it may be subject to covenants limiting or restricting its ability to take specific actions, such as incurring additional debt or making certain capital expenditures. To the extent that the Company raises additional capital through strategic licensing, collaboration or other similar agreement, it may have to relinquish valuable rights to its therapeutic candidates, future revenue streams or research programs at an earlier stage of development or on less favorable terms than it would otherwise choose, or to grant licenses on terms that may not be favorable to the Company. There can be no assurance as to the availability or terms upon which such financing and capital might be available in the future. If the Company is unable to secure adequate additional funding, it will need to reevaluate its operating plan and may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, delay, scale back or eliminate some or all of its development programs, or relinquish rights to its technology on less favorable terms than it would otherwise choose. These actions could materially impact its business, financial condition, results of operations and prospects. The rules and regulations of the SEC or any other regulatory agencies may restrict the Company’s ability to conduct certain types of financing activities, or may affect the timing of and amounts it can raise by undertaking such activities. Use of Estimates The preparation of these consolidated financial statements in conformity with GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expense and the disclosure of contingent assets and liabilities in the Company’s financial statements and accompanying notes. The Company’s most significant estimates relate to evaluation of whether revenue recognition criteria have been met, accounting for development work and preclinical studies and clinical trials, determining the assumptions used in measuring stock-based compensation, the incremental borrowing rate estimated in relation to the Company’s operating lease, and valuation allowances for the Company’s deferred tax assets. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. The Company’s actual results may differ from these estimates under different assumptions or conditions. Fair Value of Financial Instruments The Company’s financial instruments consist principally of accounts receivable, investments in debt securities, accounts payable, accrued expense, long-term debt, and warrants. The carrying amounts of financial instruments such as accounts receivable, accounts payable, accrued expense, and investments in debt securities classified as cash equivalents approximate their related fair values due to the short-term nature of these instruments. The carrying value of the Company’s debt approximates fair value due to its interest being reflective of current market rates for debt with similar terms and conditions. The Company’s warrants are equity-classified and carried at the instruments’ fair value upon classification into equity. Cash and Cash Equivalents Cash and cash equivalents are comprised of cash held in financial institutions including readily available checking and money market accounts, and highly liquid investments in debt securities with an original maturity of three months or less. As of December 31, 2022, the Company’s investments in debt securities consist of U.S. Treasury Bills, all of which mature in February 2023. As of December 31, 2022, these investments are recorded at their amortized cost of $196.3 million, which is adjusted for the amortization or accretion of premiums or discounts. Concentrations of Credit Risk Financial instruments that subject us to significant concentrations of credit risk consist primarily of cash and cash equivalents, including our investments in debt securities. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits by the Federal Deposit Insurance Corporation, or FDIC, of up to $250,000. Our investment portfolio consists of investments in U.S. Treasury securities, in excess of Securities Investor Protection Corporation, or SIPC, limits of up to $500,000 in securities. The Company’s cash management and investment policy limits investment instruments to investment-grade securities with the objective to preserve capital and to maintain liquidity until the funds can be used in operations. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash balances due to the financial condition of the depository institutions in which those deposits are held. The Company continually evaluates its accounts receivable for all outstanding third-party balances to determine the potential exposure to a concentration of credit risk. The Company’s major third-party contracting parties, some of which account for significant balances in both accounts receivable and revenue, are generally large, credit-worthy biotechnology companies and government bodies. The Company assesses the collectability of accounts receivable through a review of its current aging, as well as an analysis of its historical collection rate, general economic conditions, and credit status of these third parties. As of December 31, 2022 and December 31, 2021, all outstanding accounts receivable were deemed to be fully collectible, and therefore, no allowance for doubtful accounts was recorded. Dividends As of December 31, 2022, the Company has never declared or paid any dividends on its common stock. Additionally, the Amended 2020 Loan Agreement limits, among other things, the Company’s ability to pay dividends and make certain other payments. Any future determination to pay dividends on the Company’s common stock will be at the discretion of the Company’s board of directors and will depend upon, among other factors, the results of operations, financial condition, capital requirements, contract restrictions, business prospects and other factors the Company’s board of directors may deem relevant. Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation. Depreciation is provided on a straight-line basis over the estimated useful lives of the assets. The Company estimates useful lives as follows: • laboratory and office equipment: three • furniture, fixtures and other: five years; • computer software: three years. Amortization of leasehold improvements is provided on a straight-line basis over the shorter of their estimated useful lives or the lease term. The costs of additions and betterments are capitalized, and repairs and maintenance costs are expensed in the periods incurred. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss is recognized 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. If such assets are considered impaired, the amount of the impairment loss recognized is measured as the amount by which the carrying value of the asset exceeds the fair value of the asset, fair value being determined based upon future cash flows or appraised values, depending on the nature of the asset. The Company recognized no impairment losses during any of the periods presented within its consolidated financial statements. Leases The Company has two existing leases for its corporate headquarters in La Jolla, California. Its first lease commenced in June 2018. In May 2019, the Company signed an amendment to its lease agreement to expand the Company’s facilities, which commenced in January 2020 and is accounted for as a separate lease. The Company’s two existing leases are classified as operating leases. For the long-term operating lease of its corporate headquarters, the Company recognized an operating right-of-use asset and lease liability on its consolidated balance sheet. The lease liability is determined as the present value of future lease payments using an estimated incremental borrowing rate that the Company would have to pay to borrow equivalent funds on a collateralized basis at the lease commencement date. The operating right-of-use asset is based on the liability adjusted for any prepaid or deferred rent. The lease term at the commencement date is determined by considering whether renewal options and termination options are reasonably assured of exercise. Agreements are reviewed at inception to determine if they contain a lease. Leases are reviewed and classified as operating or financing leases at commencement. The Company has elected to exclude from its consolidated balance sheets recognition of leases having a term of 12 months or less (short-term leases) and has elected not to separate lease components and non-lease components for its long-term operating leases. Rent expense for the operating leases are recognized on a straight-line basis over the lease term and is included in operating expense in the consolidated statements of operations for all periods presented. Investment in Phylaxis The Company uses the equity method of accounting for equity investments in companies if the investment provides the ability to exercise significant influence, but not control, over operating and financial policies of the investee. As discussed in Note 6, the Company received an equity investment in the form of a 10% equity interest as consideration in a series of agreements with Phylaxis (as defined below), which is accounted for as an equity method investment. The Company’s proportionate share of the net income or loss of these companies is included as loss in equity method investment in the consolidated statement of operations. Judgment regarding the level of influence over each equity method investment includes considering key factors such as the Company’s ownership interest, representation on the board of directors, legal form of the investee (e.g. limited liability corporation), participation in policy-making decisions, and material purchase and sale transactions. The investment had been reduced to zero prior to the beginning of 2021 as a result of the allocation of the Company’s share of prior losses of the investee. Accordingly, the Company has discontinued applying the equity method and as of and for the years ended December 31, 2022 and December 31, 2021, the investment in Phylaxis remains at zero. Fair Value Measurements The Company determines the fair value measurements of applicable assets and liabilities based on a three-tier fair value hierarchy established by accounting guidance and prioritizes the inputs used in measuring fair value. These tiers include: • Level 1 - Quoted prices in active markets for identical assets or liabilities. • Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company’s debt securities consist of U.S. Treasury Bills, which are classified as Level 1 in the fair value hierarchy. Due to the short-term nature of these securities which are classified as cash equivalents, the amortized value approximates fair value and the Company does not remeasure these instruments at fair value. The Company’s outstanding debt and warrants are both classified as Level 2 in the fair value hierarchy. There were no assets or liabilities measured at fair value on a recurring basis as of December 31, 2022 or December 31, 2021. Deferred Financing Costs and Other Debt-Related Costs Deferred financing costs are capitalized, recorded as an offset to the Company’s debt balances and amortized as interest expense over the term of the associated debt instrument using the effective interest method, pursuant to ASC Topic 835-30, Imputation of Interest . If the maturity of the debt is accelerated as a result of default or early debt repayment, the amortization would then be accelerated. Amounts paid related to debt financing activities are presented on the consolidated balance sheet as a direct deduction from the debt liability. Deferred Offering Costs The Company capitalizes costs that are directly associated with equity financings until such financings are consummated at which time such costs are recorded against the gross proceeds of the offering. Legal, accounting, and filing fees related directly to the Company’s Shelf Registration are capitalized as deferred offering costs. Deferred offering costs associated with the Shelf Registration are reclassified to additional paid-in capital when the Company completes offerings under the Shelf Registration. In November 2021, the Company completed an offering under the Shelf Registration and offset $1.7 million of offering costs against the proceeds. In October 2022, the Company completed an additional offering under the Shelf Registration and offset $3.0 million of offering costs against the proceeds. There were no deferred offering costs as of December 31, 2022 or December 31, 2021. Financial Instruments with Characteristics of Both Liabilities and Equity The Company accounts for issued warrants either as a liability or equity in accordance with ASC 480-10, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, or ASC 480-10, and ASC 815-40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock , or ASC 815-40. Under ASC 480-10, warrants are considered a liability if they are mandatorily redeemable and they require settlement in cash, other assets, or a variable number of shares. If warrants do not meet liability classification under ASC 480-10, the Company considers the requirements of ASC 815-40 to determine whether the warrants should be classified as a liability or as equity. Under ASC 815-40, contracts that may require settlement for cash are liabilities, regardless of the probability of the occurrence of the triggering event. Liability-classified warrants are measured at fair value on the issuance date and at the end of each reporting period. Any change in the fair value of the warrants after the issuance date is recorded in other expense, net in the consolidated statements of operations as a gain or loss. If warrants do not require liability classification under ASC 815-40, in order to conclude warrants should be classified as equity, the Company assesses whether the warrants are indexed to its common stock and whether the warrants are classified as equity under ASC 815-40 or under another applicable GAAP standard. Equity-classified warrants are accounted for at fair value on the issuance date with no changes in fair value recognized after the issuance date. The Company’s outstanding warrants do not meet the requirements for liability classification under ASC-480-10 or ASC-815-40. Therefore, the Company’s outstanding warrants are classified as equity as of and for the years ended December 31, 2022 and December 31, 2021. Revenue Recognition The Company has generated revenue from its license and collaboration agreements with partners, as well as from grants from government agencies and private not-for-profit organizations. Collaborative Research, Development, and License Agreements The Company enters into collaborative agreements with partners which may include the transfer of licenses, options to license, and the performance of research and development activities. The terms associated with these agreements may include one or more of the following (1) license fees; (2) nonrefundable up-front fees; (3) payments for reimbursement of research costs; (4) payments associated with achieving specific development, regulatory, or commercial milestones; and (5) royalties based on specified percentages of net product sales, if any. Payments received from customers are included in deferred revenue, allocated between current and non-current on the consolidated balance sheet, until all revenue recognition criteria are met. Typically, license fees, non-refundable upfront fees, and funding of research activities are considered fixed, while milestone payments, including option exercise fees, are identified as variable consideration, which is constrained and excluded from the transaction price. The Company will recognize revenue for sales-based royalty if and when a subsequent sale occurs. The Company applies significant judgment when making estimates and assumptions under these agreements, including evaluating whether contractual obligations represent distinct performance obligations, including the assessment of whether options represent material rights, determining whether there are observable standalone prices and allocating transaction price to performance obligations within a contract, assessing whether any licenses are functional or symbolic, determining when performance obligations have been met, and assessing the recognition of variable consideration. The Company evaluates each performance obligation to determine if it can be satisfied and recognized as revenue at a point in time or over time. Typically, performance obligations consisting of a transfer of a license or the achievement of milestones are recognized at a point in time upon the transfer, while performance obligations consisting of research activities are recognized over time using an input method which is representative of the Company’s efforts to fulfill the performance obligation, based on costs incurred with third-parties or internal labor hours performed. Grant Revenue The Company has been awarded a grant from the Congressionally Directed Medical Research Program, or CDMRP, funded through the DoD, under which the Company’s internal costs specifically covered by the grant for a specified project are subject to reimbursement when incurred. Since there is no transfer of control of goods or services to the granting agency, revenue is recognized as the Company incurs expenses related to the grant in the gross amount of the reimbursement and costs associated with these reimbursements are reflected as a component of research and development expense in the consolidated statements of operations. Accrued Research and Development and Clinical Trial Costs Research and development costs are expensed as incurred and include the cost of compensation and related expenses, as well as expenses for third parties who conduct research and development on the Company’s behalf, pursuant to development and consulting agreements in place. The Company’s preclinical studies and clinical trials are performed internally, by third party contract research organizations, or CROs, and/or clinical investigators. The Company also engages with CDMOs for clinical supplies and manufacturing scale-up activities related to its therapeutic candidates. Invoicing from these third parties may be monthly based upon services performed or based upon milestones achieved. The Company accrues these expenses based upon its assessment of the status of each clinical trial and the work completed, and upon information obtained from the CROs and CDMOs. The Company’s estimates are dependent upon the timeliness and accuracy of data provided by the CROs and CDMOs regarding the status and cost of the studies. Costs incurred related to the Company’s purchases of in-process research and development for early-stage products or products that are not commercially viable and ready for use, or have no alternative future use, are charged to expense in the period incurred. Costs incurred related to the licensing of products that have not yet received marketing approval to be marketed, or that are not commercially viable and ready for use, or have no alternative future use, are charged to expense in the period incurred. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income taxes are recorded for temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities reflect the tax rates expected to be in effect for the years in which the differences are expected to reverse. A valuation allowance is provided if it is more likely than not that some or all of the deferred tax assets will not be realized. The Company also follows the provisions of accounting for uncertainty in income taxes which prescribes a model for the recognition and measurement of a tax position taken or expected to be taken in a tax return, and provides guidance on derecognition, classification, interest and penalties, disclosure and transition. The utilization of unused federal and state net operating losses, or NOLs, and research tax credit carryforwards to offset future taxable income may be subject to an annual limitation as a result of ownership changes that have occurred previously or may occur in the future. Under Sections 382 and 383 of the Internal Revenue Code, as amended, or IRC, a corporation that undergoes an “ownership change” may be subject to limitations on its ability to utilize its pre-change NOLs and other tax attributes otherwise available to offset future taxable income and/or tax liability. An ownership change is defined as a cumulative change of 50% or more in the ownership positions of certain stockholders during a rolling three-year period. The Company has not completed a formal study to determine if any ownership changes within the meaning of IRC Section 382 and 383 have occurred. It is possible that the Company has already incurred ownership changes and may incur additional ownership changes in the future. If an ownership change has occurred, the Company’s ability to use its NOL or tax credit carryforwards may be restricted, which could require the Company to pay federal or state income taxes earlier than would be required if such limitations were not in effect. Net Loss Per Share Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the same period. Diluted net loss per share is computed by dividing net loss by the weighted average number of common and common equivalent shares outstanding during the same period. The Company excludes common stock equivalents from the calculation of diluted net loss per share when the effect is anti-dilutive. For purposes of the diluted net loss per share calculation, warrants for purchase of common stock and stock options are considered to be potentially dilutive securities. Accordingly, for the years ended December 31, 2022 and December 31, 2021, there is no difference in the number of shares used to calculate basic and diluted shares outstanding. Potentially dilutive securities not included in the calculation of diluted net loss per share, because to do so would be anti-dilutive, are as follows (in thousands): AS OF DECEMBER 31, 2022 2021 Outstanding stock options 5,305 4,064 Warrant to purchase common stock 47 7 5,352 4,071 Fair Value of Stock-Based Awards The Company recognizes compensation costs related to stock options based on the estimated fair value of the awards on the date of grant. The Company estimates the grant date fair value, and the resulting stock-based compensation expense, using the Black-Scholes option pricing model. The grant date fair value of the stock-based awards is generally recognized on a straight-line basis over the requisite service period, which is generally the vesting period of the respective awards. The Company recognizes forfeitures as they occur. Other Comprehensive Income The Company has no material components of other comprehensive loss and accordingly, net loss is equal to comprehensive loss in all periods presented. Segment Information The Company operates under one segment which develops biologic therapeutic candidates. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies. Unless otherwise stated, the Company believes that the impact of the recently issued accounting pronouncements that are not yet effective will not have a material impact on its consolidated financial condition or results of operations upon adoption. Adoption of New Accounting Pronouncements In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options , which intends to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. The Company adopted ASU 2021-04 on January 1, 2022, which did not result in a material impact on its consolidated financial statements and related disclosures. In December 2022, the FASB issued ASU 2022-06, Deferral of the Sunset Date of Topic 848 , which defers the expiration date of Topic 848 as established with ASU 2020-04. In March 2020, the FASB issued ASU 2020-04, which provided temporary, optional expedients related to the accounting for contract modifications and hedging transactions as a result of the global markets’ anticipated transition away from the use of LIBOR and other interbank offered rates to alternative reference rates. The FASB established a December 31, 2022 expiration date for ASC 848. Following the extension of the intended cessation date of LIBOR in the United States to June 30, 2023, the FASB issued ASU 2022-06 to defer the expiration date of ASC 848 to December 31, 2024. ASU 2022-06 is effective upon issuance. The Company adopted ASU 2022-06 upon its issuance, which did not result in a material impact on its consolidated financial statements and related disclosures. Accounting Standards Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses : Measurement of Credit Losses on Financial Statements (Topic 362), which intends to improve financial reporting by requiring earlier recognition of credit losses on certain financial assets, such as available-for-sale debt securities. Subsequent to the issuance of ASU 2016-13, the FASB issued several additional ASUs to clarify implementation guidance, provide narrow-scope improvements and provide additional disclosure guidance. In November 2019, the FASB issued an amendment making this ASU effective for fiscal years beginning after December 15, 2022 for smaller reporting companies. The Company was a smaller reporting company at the determination date, and therefore the new standard will be effective for the Company on January 1, 2023. The Company is currently evaluating the potential impact that the adoption of ASU 2016-13 may have on its consolidated financial statements and related disclosures. |
OTHER FINANCIAL INFORMATION
OTHER FINANCIAL INFORMATION | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
OTHER FINANCIAL INFORMATION | OTHER FINANCIAL INFORMATION Prepaid Expense and Other Current Assets Prepaid expense and other current assets were comprised of the following (in thousands): AS OF DECEMBER 31, 2022 2021 Outside research and development services $ 5,697 $ 6,343 Other 674 590 Prepaid expense and other current assets $ 6,371 $ 6,933 Property and Equipment, Net Property and equipment, net were comprised of the following (in thousands): AS OF DECEMBER 31, 2022 2021 Laboratory and office equipment $ 7,023 $ 6,286 Furniture, fixtures and other 524 514 Leasehold improvements 441 441 Computer software 53 42 Construction in process — 281 Total property and equipment 8,041 7,564 Less: accumulated depreciation and amortization (5,540) (4,411) Property and equipment, net $ 2,501 $ 3,153 Depreciation and amortization expense totaled $1.2 million for each of the years ended December 31, 2022 and December 31, 2021, and consisted of the following (in thousands): YEAR ENDED DECEMBER 31, 2022 2021 Research and development $ 1,003 $ 1,003 General and administrative 222 192 Total depreciation and amortization expense $ 1,225 $ 1,195 Accrued Expenses Accrued expenses were comprised of the following (in thousands): AS OF DECEMBER 31, 2022 2021 Clinical drug substance and product manufacturing (1) $ 5,381 $ 1,564 Clinical trials (2) 4,527 4,496 Compensation expense 3,374 1,322 Interest expense 2,124 480 Other outside research and development 1,164 1,329 Professional fees 428 261 Other 226 169 Accrued expenses $ 17,224 $ 9,621 (1) Relates primarily to the Company’s usage of third-party CDMOs for clinical and development efforts. See Note 1 for further discussion of the components of research and development. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT 2020 Loan Agreement In July 2020, the Company entered into a loan and security agreement, or the 2020 Loan Agreement, with Oxford Finance LLC, or Oxford, pursuant to which it received $10.0 million in gross proceeds, or Term A. The 2020 Loan Agreement was subsequently amended in November 2020, or the November 2020 Amendment, upon which a second tranche in an aggregate principal amount of $20.0 million was funded, or Term B, and in June 2021, or the June 2021 Amendment, upon which a third tranche in an aggregate principal amount of $40.0 million was funded, or Term C. In February 2022, the Company entered into an additional amendment, or the February 2022 Amendment, to the 2020 Loan Agreement, collectively, the Amended 2020 Loan Agreement, upon which the Company received gross proceeds of $40.0 million, or Term D, net of $1.1 million of legal and amendment fees. The February 2022 Amendment also provided for an increase in the interest rate and for three future tranches of debt to be funded upon the achievement of certain milestones. In June 2022, the Company received additional gross proceeds of $30.0 million, or Term E, following the initiation of part 4 of the Phase 1 clinical trial of INBRX-105, as well as an additional $30.0 million in gross proceeds, or Term F, following the receipt of positive topline data from the Phase 1 clinical trial of INBRX-101. In October 2022, the Company entered into an amendment to the Amended 2020 Loan Agreement, or the October 2022 Amendment. The October 2022 Amendment amended the milestone terms of the last remaining tranche, Term G, under the Amended 2020 Loan Agreement to provide for the funding of $30.0 million upon the announcement of the regulatory path for INBRX-101 rather than upon the initiation of a potentially registration-enabling clinical trial of INBRX-101. In October 2022, the Company met this milestone and drew the final tranche for additional gross proceeds of $30.0 million. The Company determined the November 2020, June 2021, February 2022, and October 2022 Amendments should be treated as modifications of the original 2020 Loan Agreement since the terms and resulting cash flows were not substantially changed upon each of the amendments. The Company will continue to amortize the existing debt discounts prior to modification through the Amended Maturity Date. As of December 31, 2022, the Company has $200.0 million in gross principal outstanding in term loans under the Amended 2020 Loan Agreement. The outstanding term loans will mature on January 1, 2027, or the Amended Maturity Date, and bear interest at a floating per annum rate equal to the greater of (1) 8.30% and (2) the sum of (i) the 30 day U.S. Dollar LIBOR rate reported in The Wall Street Journal on the last business day of the month that immediately precedes the month in which the interest will accrue, plus (ii) 8.19%. Under the Amended 2020 Loan Agreement, the repayment schedule provides for interest-only payments through February 1, 2025, followed by 23 months of principal and interest payments, unless extended by a financing event as defined in the Amended 2020 Loan Agreement. In the event of a qualifying financing event in which the Company raises at least $100.0 million in upfront licensing or partnership proceeds by February 2025, the interest-only period may be extended an additional 12 months through February 1, 2026, which would then be followed by 11 months of equal payments of principal plus interest, beginning on March 1, 2026. Upon the Amended Maturity Date, a final payment of 9.0% of the original principal amount will be due to Oxford. This final payment of $18.0 million is being accreted over the life of the Amended 2020 Loan Agreement using the effective interest method. The Company has the option to prepay the outstanding balance of the term loans in full prior to the Amended Maturity Date, subject to a prepayment fee ranging from 1.0% to 3.0%, depending upon the timing of the prepayment. The Company’s outstanding debt balance under the Amended 2020 Loan Agreement consisted of the following as of December 31, 2022 and December 31, 2021 (in thousands). AS OF DECEMBER 31, 2022 2021 Term A $ 10,900 $ 10,900 Term B 21,800 21,800 Term C 43,600 43,600 Term D 43,600 — Term E 32,700 — Term F 32,700 — Term G 32,700 — Less: debt discount (15,931) (5,830) Long-term debt, including debt discount and final payment fee $ 202,069 $ 70,470 As of December 31, 2022, and unless extended in accordance with the terms described above, the Company’s interest-only period will continue through February 2025, with principal payments beginning in March 2025. Future principal payments and final fee payments will be made as follows (in thousands): AS OF DECEMBER 31, 2022 2025 $ 86,956 2026 104,348 2027 26,696 Total future minimum payments 218,000 Less: unamortized debt discount (15,931) Total debt $ 202,069 The Company’s obligations under the Amended 2020 Loan Agreement are secured by a first priority security interest of substantially all of the Company’s assets with a positive lien on intellectual property. The Amended 2020 Loan Agreement includes customary events of default, including instances of a material adverse change in the Company’s operations, that may require prepayment of the outstanding term loans. Additionally, following the June 2021 Amendment, the Amended 2020 Loan Agreement requires the Company to maintain a minimum cash balance of $20.0 million. As of December 31, 2022, the Company is in compliance with all covenants under the Amended 2020 Loan Agreement and has not received any notification or indication from Oxford of an intent to declare the loan due prior to maturity. Concurrently with the February 2022 Amendment, the Company issued 40,000 warrants to Oxford to purchase shares of the Company’s common stock at an exercise price of $45.00. Upon issuance, the warrants were classified as equity and recorded at their fair value of $0.7 million. See Note 4 for further discussion of these warrants. Interest Expense |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | STOCKHOLDERS’ EQUITY Amended and Restated Certificate of Incorporation On August 21, 2020 upon completion of the IPO, the Company’s certificate of incorporation was amended and restated to authorize 120,000,000 shares of common stock and 15,000,000 shares of preferred stock, each with a par value of $0.0001 per share. Common Stock In September 2021, the Company entered into the Sales Agreement with the Sales Agent, under which it may, from time to time, sell shares of its common stock having an aggregate offering price of up to $200.0 million through the Sales Agent, or the ATM Offering. Pursuant to the Sales Agreement, the Company paid the Sales Agent a commission for its services in acting as an agent in the sale of common stock in an amount equal to 3% of the gross sales price per share sold, which was amended to 2% of the total sales price per share sold during 2022. During the year ended December 31, 2022, the Company sold 4,332,354 shares pursuant to the sales Agreement for net proceeds of $127.4 million, after deducting commissions of $2.6 million. During the year ended December 31, 2021, the Company sold 921,042 shares pursuant to the Sales Agreement for net proceeds of $40.2 million, after deducting commissions of $1.2 million. In connection with the ATM Offerings during each of the years ended December 31, 2022 and December 31, 2021, the Company incurred an additional $0.4 million of expenses which were offset against the proceeds of the offerings. Common Stock Warrants The Company has 7,354 warrants outstanding at an exercise price of $17.00 per share, which are exercisable for shares of common stock through their expiration date of July 15, 2030. As of December 31, 2022, the warrants are equity-classified and reflected in additional paid-in-capital at a fair value of $0.1 million. The fair value of the warrants was determined using the Black-Scholes model on the date of reclassification to equity following the Company’s IPO in August 2020. Upon the February 2022 Amendment, the Company issued 40,000 warrants, which are exercisable for shares of common stock of the Company at $45.00 per share. The warrants are exercisable through their expiration date of February 18, 2032. The warrants are equity-classified and reflected in additional paid-in-capital at a fair value of $0.7 million. The fair value of the warrants was determined using the Black-Scholes model on the date of issuance. No subsequent remeasurement is required for equity-classified warrants. |
EQUITY COMPENSATION PLANS
EQUITY COMPENSATION PLANS | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
EQUITY COMPENSATION PLANS | EQUITY COMPENSATION PLANS Stock Incentive Plan The Company’s share-based compensation plan, the Amended and Restated 2017 Employee, Director and Consultant Equity Incentive Plan, or the 2017 Plan, provides for the issuance of incentive stock options, restricted and unrestricted stock awards, and other stock-based awards. As of December 31, 2022, an aggregate of 6.1 million shares of common stock were reserved for issuance under the 2017 Plan, of which 0.2 million were available. Stock Option Activity The Company recognizes compensation costs related to stock-based awards, including stock options, based on the estimated fair value of the awards on the date of grant. The Company grants options with an exercise price equal to the fair market value of the Company’s stock on the date of the option grant. The options are subject to four-year vesting with a one-year cliff and have a contractual term of 10 years. A summary of the Company’s stock option activity under its 2017 Plan for the year ended December 31, 2022 is as follows (in thousands, except for per share data and years): Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (In Years) Aggregate Intrinsic Value Outstanding as of December 31, 2021 4,064 $ 22.19 Granted 1,916 $ 24.95 Forfeited (434) $ 31.00 Exercised (241) $ 11.46 Outstanding as of December 31, 2022 5,305 $ 22.95 8.0 $ 29,365 Vested and exercisable as of December 31, 2022 2,293 $ 19.03 6.8 $ 19,247 The aggregate intrinsic value of stock options exercised during the years ended December 31, 2022 and December 31, 2021 was $3.7 million and $7.5 million, respectively. Aggregate intrinsic value of stock options exercised and outstanding is calculated using the fair value of common stock on the date of exercise and as of December 31, 2022, respectively. The total fair value of stock options vested during the years ended December 31, 2022 and December 31, 2021 was $25.0 million and $5.6 million, respectively. Stock-Based Compensation Expense Stock options are valued using the Black-Scholes Merton option pricing model on the date of grant. This option pricing model involves a number of estimates, including the expected lives of the stock options, the Company’s anticipated stock volatility, and interest rates. Stock-based compensation expense is recognized using the straight-line method over the vesting period. The Company recognizes forfeitures as they occur. The weighted-average assumptions used by the Company to estimate the fair value of stock option grants using the Black-Scholes option pricing model, as well as the resulting weighted-average fair value for the years ended December 31, 2022 and December 31, 2021 were as follows. YEAR ENDED DECEMBER 31, 2022 2021 Risk-free interest rate 2.63 % 0.71 % Expected volatility 85.26 % 93.49 % Expected dividend yield — % — % Expected term 6.08 6.08 Weighted average fair value $ 17.72 $ 24.20 The Company determines the assumptions used in the option pricing model in the following manner: Risk-Free Interest Rate— For the determination of the risk-free interest rates, the Company utilizes the U.S. Treasury yield curve for instruments in effect at the time of measurement with a term commensurate with the expected term assumption. Expected Volatility— Due to the Company’s limited historical stock price volatility data indicative of the expected future volatility, the Company based its estimate of expected volatility on the estimated and expected volatilities of a guideline group of publicly traded companies. For these analyses, the Company selected companies with comparable characteristics including enterprise value, risk profiles, and with historical share price information sufficient to meet the expected life of the stock-based awards. The Company computes the historical volatility data using the daily closing prices for the selected companies’ shares during the equivalent period of the calculated expected term of its stock-based awards. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available, or until the volatility of the Company’s market-traded shares best represents its expected volatility. Expected Dividend— The expected dividend yield is assumed to be zero since the Company has never paid dividends and does not have current plans to pay any dividends on its common stock. Expected Term— The Company estimates the expected term of its stock options granted to employees and non-employee directors using the simplified method, whereby, the expected term equals the average of the vesting term and the original contractual term of the option. The Company utilizes this method since it does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. Fair Value—T he fair value of the Company’s common stock is determined based on its closing market price on the date of the grant. The Company’s board of directors intended all options granted to be exercisable at a price per share not less than the per share fair value of its common stock underlying those options on the grant date. Stock-based compensation expense for stock options consisted of the following (in thousands): YEAR ENDED DECEMBER 31, 2022 2021 Research and development $ 14,513 $ 11,830 General and administrative 5,937 3,218 Total stock-based compensation expense $ 20,450 $ 15,048 |
LICENSE AND GRANT REVENUES
LICENSE AND GRANT REVENUES | 12 Months Ended |
Dec. 31, 2022 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Abstract] | |
LICENSE AND GRANT REVENUES | LICENSE AND GRANT REVENUES The following table summarizes the total revenue recorded in the Company’s consolidated statements of operations (in thousands): YEAR ENDED DECEMBER 31, 2022 2021 License fee revenue Phylaxis BioScience, LLC $ 1,101 $ 2,392 Chiesi Farmaceutici S.p.A. 877 533 2seventy bio, Inc. 200 4,200 Total license fee revenue 2,178 7,125 Grant revenue Congressionally Directed Medical Research Program 14 106 Total grant revenue 14 106 Total revenue $ 2,192 $ 7,231 License and Collaboration Agreements Phylaxis Agreements In July 2020, the Company entered into a joint venture with Phylaxis BioScience, LLC, or Phylaxis. In connection with the joint venture, the Company entered into the following agreements: Contribution Agreement, License Agreement, Limited Liability Company Agreement, and Master Services Agreement, or collectively the Phylaxis Agreements, pursuant to which the Company licensed certain intellectual property and know-how to Phylaxis and agreed to provide services to develop certain compounds. Upon closing, the Company received a $2.5 million nonrefundable, upfront payment from Phylaxis under the Master Services Agreement, or the MSA. The Company has also received an additional $2.5 million, which was payable within 180 days from closing under the MSA, in two payments of $1.25 million each, received in October 2020 and January 2021. Upon closing, the Company received a 10% equity interest in Phylaxis as consideration for the contribution of the license of the Company’s intellectual property and know-how and is entitled to receive an additional 5% based on the achievement of certain milestones. Under the License Agreement, the Company is also entitled to specified development and commercialization milestone payments of up to an aggregate of $225.0 million and $175.0 million, respectively. The Company is also entitled to share in a percentage of the profits of Phylaxis under the Limited Liability Company Agreement. In order to determine the fair value of the equity interest in Phylaxis, the Company engaged a third-party valuation specialist. The valuation report utilized a market approach to establish the total equity value of Phylaxis using inputs not observable in the market, including the discount rate. The fair value of the equity interest was $0.5 million, which has been accounted for under the equity method. The fair value of the equity interest upon the execution of the agreements has been included in the transaction price, along with the $5.0 million of payments due pursuant to the MSA. The Company identified the transfer of the exclusive licenses for, and performance of, development services to modify the first and second compounds as one performance obligation and allocated the transaction price evenly between the two compounds. Revenue related to the performance obligation will be recognized over time as services are performed, based on the Company’s progress to satisfy the performance obligation. During the third quarter of 2022, the Company fulfilled this performance obligation in full and recognized all remaining deferred revenue under this contract. During the years ended December 31, 2022 and December 31, 2021, the Company recognized $1.1 million and $2.4 million of revenue related to this performance obligation, respectively. As of December 31, 2022, the Company has recognized all revenue related to this agreement and has no deferred revenue remaining. As of December 31, 2021, the Company had $1.1 million deferred revenue related to this agreement, all of which was classified as current. Chiesi In May 2019, the Company entered into an Option Agreement, as amended by the First Amendment to Option Agreement, dated August 19, 2019, or the Chiesi Option Agreement, with Chiesi Farmaceutici S.p.A., or Chiesi, pursuant to which the Company granted to Chiesi an exclusive option to obtain an exclusive license to develop and commercialize INBRX-101 outside of the United States and Canada. Additionally, the Chiesi Option Agreement provides Chiesi with a right of negotiation for INBRX-101 development and commercialization rights in the United States and Canada in the event that the Company engages in discussions with any third parties for such rights during the term of the Chiesi Option Agreement or, as applicable, the term of a definitive exclusive license agreement between Chiesi and the Company. Under the terms of the Chiesi Option Agreement, the Company received a one-time, non-refundable option initiation payment of $10.0 million in August 2019. If Chiesi chooses to exercise its option under the Chiesi Option Agreement, then Chiesi must pay the Company a one-time, non-refundable fee of $12.5 million upon the effective date of the definitive agreement granting Chiesi the exclusive license. If the option is exercised, under the license agreement, the Company may be entitled to receive specified milestone payments of up to $122.5 million, as well as royalties on future product sales. The Company has identified one performance obligation as of the effective date of the Chiesi Option Agreement, which is to perform research and development services for Chiesi during the option period, which will continue (unless the Chiesi Option Agreement is terminated earlier by Chiesi or the Company) until 60 days following the last to occur of (i) the Company’s delivery to Chiesi of the trial phase data for the first Phase I Clinical Trial, (ii) the Company’s delivery to Chiesi of the finalized minutes from the definitive U.S. Food and Drug Administration, or FDA, scientific advice meeting conducted following completion of such Phase I Clinical Trial, and (iii) the Company’s delivery to Chiesi of the finalized minutes from the definitive parallel European Medicines Agency health technology assessment, or EMA-HTA, scientific advice meeting conducted following completion of such Phase I Clinical Trial. The Company has determined that the option to grant a license in the future is not a material right. The $10.0 million upfront payment has been allocated to the single performance obligation. Revenue is recognized over time as services are performed during the option period, based on the Company’s effort to satisfy the performance obligation relative to the total expense estimated to be incurred during the option period. During the years ended December 31, 2022 and December 31, 2021, the Company recognized $0.9 million and $0.5 million in revenue related to this agreement, respectively. As of December 31, 2022, the Company has $0.1 million of deferred revenue related to this agreement, all of which is classified as current. As of December 31, 2021, the Company had $0.9 million and $0.1 million of current and non-current deferred revenue related to this agreement, respectively. 2seventy bio, Inc. 2018 License Agreement On December 20, 2018, the Company entered into a License Agreement with bluebird bio, Inc., or bluebird, whereby the Company granted bluebird the exclusive, worldwide rights to develop, manufacture, and commercialize certain cell therapy products containing binders. In November 2021, bluebird assigned the agreement, or the 2018 2seventy Agreement, to its affiliate, 2seventy bio, Inc., or 2seventy, in connection with an internal restructuring and subsequent spin-out of 2seventy. Under this agreement, the Company is entitled to receive specified development milestone payments of up to an aggregate of $51.5 million per therapeutic, as well as percentage tiered royalties on future product sales with rates in the mid-single-digits. Due to the uncertainty in the achievement of the developmental milestones, the variable consideration associated with the future milestone payments has been fully constrained (excluded) from the transaction price until such time that the Company concludes that it is probable that a significant reversal of previously recognized revenue will not occur. These estimates will be re-assessed at each reporting period. In July 2021, a milestone event under the 2018 2seventy Agreement was achieved and the Company recognized $2.0 million of revenue at that point in time. The Company received the associated $2.0 million payment in August 2021. During the year ended December 31, 2021, the Company recognized $2.0 million of revenue related to this agreement. During the year ended December 31, 2022, the Company recognized no revenue related to this agreement. 2020 Option and License Agreement In June 2020, the Company entered into an Option and License Agreement with bluebird, pursuant to which the Company granted to bluebird exclusive worldwide rights to develop binders and cell therapy products containing single domain antibodies, or sdAbs, directed to specified targets, consisting of two initial programs and up to an additional 8 programs. The Company retains all rights to the specific sdAbs outside of the cell therapy field. In November 2021, this agreement, or the 2020 2seventy Agreement, was also assigned to 2seventy in connection with bluebird’s internal restructuring and subsequent spin-out of 2seventy. In June 2020, the Company received a non-refundable upfront option fee of $0.2 million in connection with each of the two initial programs, or $0.4 million in aggregate, and is entitled to an upfront option fee for each additional program, on a program-by-program basis. In June 2022, 2seventy selected a third program and paid a non-refundable upfront option fee of $0.2 million in exchange for a development license. Under each of the three programs, the Company has granted an option in which 2seventy may acquire an exclusive license with respect to all binders and cell therapy products developed under this agreement, which entitles the Company to additional fees upon exercise of the option. In connection with each program for which 2seventy exercises its option, 2seventy will be required to pay the Company a one-time, non-refundable, non-creditable fee in the low-single-digit millions. The Company is also entitled to receive certain developmental milestone payments of up to an aggregate of $51.5 million per therapeutic, as well as percentage tiered royalties on future product sales with rates in the mid-single-digits. Due to the uncertainty in the achievement of the developmental milestones and future sales, the variable consideration associated with the future milestone payments has been fully constrained (excluded) from the transaction price until such time that the Company concludes that it is probable that a significant reversal of previously recognized revenue will not occur. These estimates will be re-assessed at each reporting period. As of the effective date of the 2020 2seventy Agreement, the Company identified one performance obligation, which was the transfer of the exclusive development license to bluebird for the two initial programs. The Company determined that the option granted for an exclusive license in the future was not a material right. For the eight programs not identified upon execution of the contract, the Company evaluated the customer option for additional purchases and determined that those options for additional programs did not constitute material rights nor variable consideration. As additional programs are identified, the Company re-assesses its performance obligations and transaction price accordingly. In May 2021, pursuant to the option extension terms in the 2020 2seventy Agreement, bluebird requested to extend the option term for one of the initial programs by an additional six months in exchange for an option extension fee of $0.1 million. The Company recognized the $0.1 million of revenue related to this extension in May 2021, the point in time in which the extension was granted. In October 2021, pursuant to the option exercise terms in the 2020 2seventy Agreement, the Company received a $2.1 million option exercise fee for one of the initial programs and transferred an exclusive license for the program and recognized the $2.1 million of revenue related to this option exercise at the point in time in which the exclusive license was transferred. In June 2022, pursuant to the terms regarding the addition of new programs in the 2020 2seventy Agreement, the Company received a $0.2 million upfront option fee related to the selection of a third program and transferred the related know-how and development license. The Company recognized the $0.2 million of revenue at the point in time in which the program was added and the program term began. During the years ended December 31, 2022 and December 31, 2021, the Company recognized $0.2 million and $2.2 million of revenue related to this agreement, respectively. Government Grants Grant revenue was recognized in accordance with the Company’s stated methodology discussed in Note 1. CDMRP funded through the DoD In February 2021, the Company was awarded a grant from the DoD in the amount of approximately $0.3 million for the development of sdAb based therapeutics targeting SARS-CoV-2 Spike protein for the treatment of COVID-19, or the 2021 DoD grant. Work under the grant began in February 2021 and continued through February 2022. Revenue from this grant is based upon internal and subcontractor costs incurred by the Company that are specifically covered by the grants, and where applicable, an additional facilities and administrative rate that provided funding for overhead expenses. Revenue is recognized when the Company incurs these covered expenses related to the grant’s continued progression. The Company submits requests for reimbursement to the DoD for only those expenses which have been incurred by the Company in each period, resulting in reimbursement in arrears. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS From time to time, the Company will enter into an agreement with a related party in the ordinary course of its business. These agreements are ratified by the Company’s Board of Directors or a committee thereof pursuant to policy. LAV Summit Limited LAV Summit Limited, or LAV SL, a limited company, is a principal shareholder which owned more than 5% of the Company’s outstanding equity interest during the year ended December 31, 2021. Due to this equity ownership, LAV SL was considered a related party. LAV SL’s General Partner, Lilly Asia Ventures, or LAV, through one of its funds, holds a significant equity ownership position in Chinese biotechnology company, Elpiscience Biopharmaceuticals, Inc., or Elpiscience, and the Venture Partner of LAV is the CEO, Founder, and Director at Elpiscience. Accordingly, the Company identified Elpiscience as a related party and all agreements entered into between the Company and Elpiscience through December 31, 2021 are deemed related party agreements. As of December 31, 2021, LAV SL no longer holds more than 5% of the Company’s outstanding equity interest. Accordingly, any future contracts entered into with LAV SL affiliates will not be considered related party transactions. Elpiscience In April 2018, the Company entered into a license agreement, or the OX40 License Agreement, with Elpiscience, whereby the Company granted Elpiscience an exclusive license to the Company’s multivalent protein therapeutic directed to the biological target OX40, or INBRX-106. Under this agreement, the Company is entitled to reimbursement for certain CMC and toxicology expenses incurred. The Company received $0.2 million in reimbursements under this agreement during the year ended December 31, 2022, and has received $5.4 million to date as of December 31, 2022. During the year ended December 31, 2022, the Company derecognized $32,000 as contra-expenses, all of which was received in cash as of December 31, 2022. No further reimbursements remain under this contract. In July 2020, the Company entered into an additional cost sharing agreement with Elpiscience related to the OX40 License Agreement. Under this agreement, the Company is entitled to reimbursement for certain formulation development costs. Reimbursements under this contract are recognized as contra-expense as incurred. The Company received $0.3 million and $0.2 million in reimbursements under this agreement during the years ended December 31, 2022 and December 31, 2021, respectively, and has received $0.5 million of reimbursements to date as of December 31, 2022. No further reimbursements remain under this contract. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The components of income tax expense (benefit) were as follows for the years ended December 31, 2022 and December 31, 2021, respectively (in thousands): YEAR ENDED DECEMBER 31, 2022 2021 Current expense: State $ 3 $ 2 Total current expense $ 3 $ 2 The provision for the years ended December 31, 2022 and December 31, 2021 was related to state income taxes. A reconciliation of income tax expense to the amount computed by applying the statutory federal income tax rate to the loss from operations is summarized for the years ended December 31, 2022 and December 31, 2021 as follows (in thousands): YEAR ENDED DECEMBER 31, 2022 2021 Expected income tax benefit at federal statutory rate $ (30,497) $ (17,171) State income tax expense (benefit), net of federal benefit (2,495) (1,006) Permanent items 583 (207) R&D credits (1,261) (1,912) Unrecognized tax benefits (FIN 48) 751 691 Return to provision true-ups (135) 165 Valuation allowance 33,057 19,442 Income tax expense $ 3 $ 2 Income taxes are accounted for under the asset and liability method. Deferred income taxes are recorded for temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities reflect the tax rates expected to be in effect for the years in which the differences are expected to reverse. A valuation allowance is provided if it is more likely than not that some or all of the deferred tax assets will not be realized. The components of net deferred income taxes were as follows (in thousands): AS OF DECEMBER 31, 2022 2021 Deferred income tax assets Net operating loss carryforward $ 52,970 $ 43,440 Research and development credits 9,728 8,539 Intangibles 3,684 3,875 Accruals 696 257 Stock compensation 5,130 1,888 Capitalized research and development costs 19,585 — Deferred revenue 37 456 Operating lease liabilities 1,118 1,428 Other — 14 Gross deferred tax assets 92,948 59,897 Less: Valuation allowance (91,586) (58,528) Total deferred tax assets 1,362 1,369 Deferred income tax liabilities Fixed assets (35) (20) Operating lease right-of-use assets (1,048) (1,349) Other (279) — Total deferred tax liabilities (1,362) (1,369) Net deferred tax assets (liabilities) $ — $ — As of December 31, 2022, the Company had unused federal and state NOL carryforwards of approximately $240.8 million and $34.1 million, respectively. The federal NOL carryforwards may be carried forward indefinitely but are only available to offset up to 80% of pre-NOL taxable income each year. The state NOL carryforwards will begin to expire in 2038, if not utilized. As of December 31, 2022, the Company also had federal and state research tax credit carryforwards of $9.3 million and $5.1 million, respectively. The federal research tax credit carryforwards begin to expire in 2038, while the state carryforwards have no expiration. The utilization of NOL and research tax credit carryforwards to offset future taxable income may be subject to an annual limitation as a result of ownership changes that have occurred previously or may occur in the future. Under Sections 382 and 383 of the IRC, a corporation that undergoes an “ownership change” may be subject to limitations on its ability to utilize its pre-change NOLs and other tax attributes otherwise available to offset future taxable income and/or tax liability. An ownership change is defined as a cumulative change of 50% or more in the ownership positions of certain stockholders during a rolling three-year period. The Company has not completed a formal study to determine if any ownership changes within the meaning of IRC Section 382 and 383 have occurred. It is possible that the Company has already incurred ownership changes and may incur additional ownership changes in the future. If an ownership change has occurred, the Company’s ability to use its NOL or tax credit carryforwards may be restricted, which could require the Company to pay federal or state income taxes earlier than would be required if such limitations were not in effect. The Company has established a full valuation allowance against its deferred tax assets due to uncertainties that preclude it from determining that it is more likely than not that the Company will be able to generate sufficient taxable income to realize such assets. Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the three-year period ended December 31, 2022. Such objective evidence limits the ability to consider other subjective evidence such as the Company’s projections for future growth. Based on this evaluation, as of December 31, 2022, a valuation allowance of $91.6 million has been recorded in order to measure only the portion of the deferred tax asset that more likely than not will be realized. The amount of the deferred tax asset considered realizable, however, could be adjusted if objective negative evidence in the form of cumulative losses is no longer present and additional weight may be given to subjective evidence, such as estimates of future taxable income during carryforward periods and the Company’s projections for growth. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. While the Company believes that it has appropriate support for the positions taken on its tax returns, the Company regularly assesses the potential outcome of examinations by tax authorities in determining the adequacy of its provision for income taxes. The following table summarizes the activity related to the Company’s unrecognized tax benefits (in thousands): AS OF DECEMBER 31, 2022 2021 Beginning balance $ 2,846 $ 2,155 Increases related to current year tax positions 751 691 Ending balance $ 3,597 $ 2,846 As of December 31, 2022, the Company had gross unrecognized tax benefits of $3.6 million, none of which would affect the effective tax rate due to the existence of a full valuation allowance. The Company does not expect any significant increases or decreases to its unrecognized tax benefits within the next 12 months. The Company’s policy is to recognize the interest expense and/or penalties related to income tax matters as a component of income tax expense. The Company had no accrual for interest or penalties on its consolidated balance sheets as of December 31, 2022 or December 31, 2021, and has not recognized interest and/or penalties in its consolidated statements of operations for the years ended December 31, 2022 and December 31, 2021 as the unrecognized tax benefits relate to tax positions for which no cash tax liability has been reduced. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
LEASES | LEASES Operating Leases In September 2017, the Company entered into a seven-year lease agreement as its sole location in La Jolla, California. The lease expires in June 2025 with an option to extend the lease an additional five years. The lease contained an initial base rent of approximately $0.1 million per month with 2% annual escalations, plus a percentage of taxes and operating expenses incurred by the lessor in connection with the ownership and management of the property, the latter of which to be determined annually. In May 2019, the Company executed an amendment to its lease agreement to expand its facilities and began occupying this space in January 2020. The amended lease terminates coterminously with the initial lease agreement and contains an initial base rent of approximately $30,000 per month with 2% annual escalations, plus a percentage of taxes and operating expenses incurred by the lessor in connection with the ownership and management of the property, the latter of which is to be determined annually. The operating right-of-use asset and operating lease liability as of December 31, 2022 and December 31, 2021 are as follows (in thousands): AS OF DECEMBER 31, 2022 2021 Operating right-of-use asset $ 4,717 $ 6,338 Operating lease liability Current 1,860 1,674 Non-current 3,173 5,033 Total operating lease liability $ 5,033 $ 6,707 During the years ended December 31, 2022 and December 31, 2021, the Company recognized operating lease expense of $3.4 million and $3.2 million, respectively. During each of the years ended December 31, 2022 and December 31, 2021, the Company paid $2.2 million for amounts included in the measurement of the operating lease liability in each period. As of December 31, 2022 and December 31, 2021, the Company’s operating lease had a remaining term of 2.5 and 3.5 years, respectively. The Company discounts its lease payments using its incremental borrowing rate as of the commencement of the lease. The Company has determined a weighted-average discount rate of 8.2% as of December 31, 2022 and December 31, 2021. Future minimum payments for the Company’s operating leases reconciled to the lease liability are as follows (in thousands): AS OF DECEMBER 31, 2022 2023 $ 2,203 2024 2,247 2025 1,137 Total future minimum lease payments $ 5,587 Less: imputed interest (554) Present value of operating lease liability 5,033 Less: current portion of operating lease liability (1,860) Non-current portion of operating lease liability $ 3,173 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Litigation The Company is not party to any material legal proceedings. From time to time, it may be involved in legal proceedings or subject to claims incident to the ordinary course of business. Regardless of the outcome, such proceedings or claims can have an adverse impact on the Company because of defense and settlement costs, diversion of resources and other factors, and there can be no assurances that favorable outcomes will be obtained. Indemnification In the ordinary course of business, the Company enters into agreements that may include indemnification provisions. Pursuant to such agreements, the Company may indemnify, hold harmless and defend an indemnified party for losses suffered or incurred by the indemnified party. In some cases, the indemnification obligation will continue after the termination of the agreement. The maximum potential amount of future payments the Company could be required to make under these provisions is not determinable. In addition, the Company has entered into indemnification agreements with its directors and certain officers that may require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. To date, no demands have been made upon the Company to provide indemnification under these agreements, and thus, there are no indemnification claims that the Company is aware of that could have a material effect on the Company’s consolidated balance sheets, consolidated statements of operations, or consolidated statements of cash flows. Purchase Commitments The Company has several ongoing contracts with CROs for preclinical studies and clinical trials and with CDMOs for clinical supplies and manufacturing scale-up activities. While these contracts are generally cancellable, some may contain specific activities that involve one or more non-cancellable commitments, including minimum purchase commitments, binding annual forecasts, and capital equipment investments. Additionally, depending on the timing and reasoning of the exit, certain termination penalties may apply and can range from cost of work performed to date and up to twelve months of future committed manufacturing costs. As of December 31, 2022 and December 31, 2021, the non-cancellable portion of these contracts total in aggregate, excluding amounts paid or incurred at each respective date, approximately $74.8 million and $2.4 million, respectively. The non-cancellable purchase commitments as of December 31, 2022 relate to the purchase of clinical supply for INBRX-101, which increased during the year ended December 31, 2022 as the Company progressed to the next stage of gated activities under such agreements. During the years ended December 31, 2022 and December 31, 2021, the Company incurred $0.3 million and $1.0 million of expenses related to its non-cancellable purchase agreements, respectively. Other Commitments |
ORGANIZATION AND SUMMARY OF S_2
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, or GAAP, and applicable rules and regulations of the Securities and Exchange Commission, or the SEC, related to an annual report on the Form 10-K. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary and have been prepared in conformity with GAAP. All intercompany accounts and transactions have been eliminated in consolidation. |
Liquidity | Liquidity As of December 31, 2022, the Company had an accumulated deficit of $372.4 million and cash and cash equivalents of $273.9 million. From its inception and through December 31, 2022, the Company has devoted substantially all of its efforts to therapeutic drug discovery and development, conducting preclinical studies and clinical trials, enabling manufacturing activities in support of its therapeutic candidates, organizing and staffing the Company, establishing its intellectual property portfolio and raising capital to support and expand these activities. The Company believes that its existing cash and cash equivalents will be sufficient to fund the Company’s operations for at least 12 months from the date these consolidated financial statements are issued. The Company plans to finance its future cash needs through equity offerings, debt financings or other capital sources, including potential collaborations, licenses, and other similar arrangements. If the Company does raise additional capital through public or private equity or convertible debt offerings, the ownership interests of its existing stockholders will be diluted, and the terms of those securities may include liquidation or other preferences that adversely affect its stockholders’ rights. If the Company raises capital through additional debt financings, it may be subject to covenants limiting or restricting its ability to take specific actions, such as incurring additional debt or making certain capital expenditures. To the extent that the Company raises additional capital through strategic licensing, collaboration or other similar agreement, it may have to relinquish valuable rights to its therapeutic candidates, future revenue streams or research programs at an earlier stage of development or on less favorable terms than it would otherwise choose, or to grant licenses on terms that may not be favorable to the Company. There can be no assurance as to the availability or terms upon which such financing and capital might be available in the future. If the Company is unable to secure adequate additional funding, it will need to reevaluate its operating plan and may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, delay, scale back or eliminate some or all of its development programs, or |
Use of Estimates | Use of Estimates The preparation of these consolidated financial statements in conformity with GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expense and the disclosure of contingent assets and liabilities in the Company’s financial statements and accompanying notes. The Company’s most significant estimates relate to evaluation of whether revenue recognition criteria have been met, accounting for development work and preclinical studies and clinical trials, determining the assumptions used in measuring stock-based compensation, the incremental borrowing rate estimated in relation to the Company’s operating lease, and valuation allowances for the Company’s deferred tax assets. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. The Company’s actual results may differ from these estimates under different assumptions or conditions. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments consist principally of accounts receivable, investments in debt securities, accounts payable, accrued expense, long-term debt, and warrants. The carrying amounts of financial instruments such as accounts receivable, accounts payable, accrued expense, and investments in debt securities classified as cash equivalents approximate their related fair values due to the short-term nature of these instruments. The carrying value of the Company’s debt approximates fair value due to its interest being reflective of current market rates for debt with similar terms and conditions. The Company’s warrants are equity-classified and carried at the instruments’ fair value upon classification into equity. |
Cash and Cash Equivalents | Cash and Cash EquivalentsCash and cash equivalents are comprised of cash held in financial institutions including readily available checking and money market accounts, and highly liquid investments in debt securities with an original maturity of three months or less. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that subject us to significant concentrations of credit risk consist primarily of cash and cash equivalents, including our investments in debt securities. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits by the Federal Deposit Insurance Corporation, or FDIC, of up to $250,000. Our investment portfolio consists of investments in U.S. Treasury securities, in excess of Securities Investor Protection Corporation, or SIPC, limits of up to $500,000 in securities. The Company’s cash management and investment policy limits investment instruments to investment-grade securities with the objective to preserve capital and to maintain liquidity until the funds can be used in operations. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash balances due to the financial condition of the depository institutions in which those deposits are held. The Company continually evaluates its accounts receivable for all outstanding third-party balances to determine the potential exposure to a concentration of credit risk. The Company’s major third-party contracting parties, some of which account for significant balances in both accounts receivable and revenue, are generally large, credit-worthy biotechnology companies and government bodies. The Company assesses the collectability of accounts receivable through a review of its current aging, as well as an analysis of its historical collection rate, general economic conditions, and credit status of these third parties. As of December 31, 2022 and December 31, 2021, all outstanding |
Dividends | Dividends As of December 31, 2022, the Company has never declared or paid any dividends on its common stock. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation. Depreciation is provided on a straight-line basis over the estimated useful lives of the assets. The Company estimates useful lives as follows: • laboratory and office equipment: three • furniture, fixtures and other: five years; • computer software: three years. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss is recognized 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. If such assets are considered impaired, the amount of the impairment loss recognized is measured as the amount by which the carrying value of the asset exceeds the fair value of the asset, fair value being determined based upon future cash flows or appraised values, depending on the nature of the asset. The Company recognized no impairment losses during any of the periods presented within its consolidated financial statements. |
Leases | Leases The Company has two existing leases for its corporate headquarters in La Jolla, California. Its first lease commenced in June 2018. In May 2019, the Company signed an amendment to its lease agreement to expand the Company’s facilities, which commenced in January 2020 and is accounted for as a separate lease. The Company’s two existing leases are classified as operating leases. For the long-term operating lease of its corporate headquarters, the Company recognized an operating right-of-use asset and lease liability on its consolidated balance sheet. The lease liability is determined as the present value of future lease payments using an estimated incremental borrowing rate that the Company would have to pay to borrow equivalent funds on a collateralized basis at the lease commencement date. The operating right-of-use asset is based on the liability adjusted for any prepaid or deferred rent. The lease term at the commencement date is determined by considering whether renewal options and termination options are reasonably assured of exercise. Agreements are reviewed at inception to determine if they contain a lease. Leases are reviewed and classified as operating or financing leases at commencement. The Company has elected to exclude from its consolidated balance sheets recognition of leases having a term of 12 months or less (short-term leases) and has elected not to separate lease components and non-lease components for its long-term operating leases. |
Investment in Phylaxis | Investment in Phylaxis The Company uses the equity method of accounting for equity investments in companies if the investment provides the ability to exercise significant influence, but not control, over operating and financial policies of the investee. As discussed in Note 6, the Company received an equity investment in the form of a 10% equity interest as consideration in a series of agreements with Phylaxis (as defined below), which is accounted for as an equity method investment. The Company’s proportionate share of the net income or loss of these companies is included as loss in equity method investment in the consolidated statement of operations. Judgment regarding the level of influence over each equity method investment includes considering key factors such as the Company’s ownership interest, representation on the board of directors, legal form of the investee (e.g. limited liability corporation), participation in policy-making decisions, and material purchase and sale transactions. The investment had been reduced to zero prior to the beginning of 2021 as a result of the allocation of the Company’s share of prior losses of the investee. Accordingly, the Company has discontinued applying the equity method and as of and for the years ended December 31, 2022 and December 31, 2021, the investment in Phylaxis remains at zero. |
Fair Value Measurements | Fair Value Measurements The Company determines the fair value measurements of applicable assets and liabilities based on a three-tier fair value hierarchy established by accounting guidance and prioritizes the inputs used in measuring fair value. These tiers include: • Level 1 - Quoted prices in active markets for identical assets or liabilities. • Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. |
Deferred Financing Costs and Other Debt-Related Costs and Deferred Offering Costs | Deferred Financing Costs and Other Debt-Related Costs Deferred financing costs are capitalized, recorded as an offset to the Company’s debt balances and amortized as interest expense over the term of the associated debt instrument using the effective interest method, pursuant to ASC Topic 835-30, Imputation of Interest . If the maturity of the debt is accelerated as a result of default or early debt repayment, the amortization would then be accelerated. Amounts paid related to debt financing activities are presented on the consolidated balance sheet as a direct deduction from the debt liability. Deferred Offering Costs The Company capitalizes costs that are directly associated with equity financings until such financings are consummated at which time such costs are recorded against the gross proceeds of the offering. Legal, accounting, and filing fees related directly to the Company’s Shelf Registration are capitalized as deferred offering costs. Deferred offering costs associated with the Shelf Registration are reclassified to additional paid-in capital when the Company completes offerings under the Shelf Registration. In November 2021, the Company completed an offering under the Shelf Registration and offset $1.7 million of offering costs against the proceeds. In October 2022, the Company completed an additional offering under the Shelf Registration and offset $3.0 million of |
Financial Instruments with Characteristics of Both Liabilities and Equity | Financial Instruments with Characteristics of Both Liabilities and Equity The Company accounts for issued warrants either as a liability or equity in accordance with ASC 480-10, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, or ASC 480-10, and ASC 815-40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock , or ASC 815-40. Under ASC 480-10, warrants are considered a liability if they are mandatorily redeemable and they require settlement in cash, other assets, or a variable number of shares. If warrants do not meet liability classification under ASC 480-10, the Company considers the requirements of ASC 815-40 to determine whether the warrants should be classified as a liability or as equity. Under ASC 815-40, contracts that may require settlement for cash are liabilities, regardless of the probability of the occurrence of the triggering event. Liability-classified warrants are measured at fair value on the issuance date and at the end of each reporting period. Any change in the fair value of the warrants after the issuance date is recorded in other expense, net in the consolidated statements of operations as a gain or loss. If warrants do not require liability classification under ASC 815-40, in order to conclude warrants should be classified as equity, the Company assesses whether the warrants are indexed to its common stock and whether the warrants are classified as equity under ASC 815-40 or under another applicable GAAP standard. Equity-classified warrants are accounted for at fair value on the issuance date with no changes in fair value recognized after the issuance date. The Company’s outstanding warrants do not meet the requirements for liability classification under ASC-480-10 or ASC-815-40. Therefore, the Company’s outstanding warrants are classified as equity as of and for the years ended December 31, 2022 and December 31, 2021. |
Revenue Recognition | Revenue Recognition The Company has generated revenue from its license and collaboration agreements with partners, as well as from grants from government agencies and private not-for-profit organizations. Collaborative Research, Development, and License Agreements The Company enters into collaborative agreements with partners which may include the transfer of licenses, options to license, and the performance of research and development activities. The terms associated with these agreements may include one or more of the following (1) license fees; (2) nonrefundable up-front fees; (3) payments for reimbursement of research costs; (4) payments associated with achieving specific development, regulatory, or commercial milestones; and (5) royalties based on specified percentages of net product sales, if any. Payments received from customers are included in deferred revenue, allocated between current and non-current on the consolidated balance sheet, until all revenue recognition criteria are met. Typically, license fees, non-refundable upfront fees, and funding of research activities are considered fixed, while milestone payments, including option exercise fees, are identified as variable consideration, which is constrained and excluded from the transaction price. The Company will recognize revenue for sales-based royalty if and when a subsequent sale occurs. The Company applies significant judgment when making estimates and assumptions under these agreements, including evaluating whether contractual obligations represent distinct performance obligations, including the assessment of whether options represent material rights, determining whether there are observable standalone prices and allocating transaction price to performance obligations within a contract, assessing whether any licenses are functional or symbolic, determining when performance obligations have been met, and assessing the recognition of variable consideration. The Company evaluates each performance obligation to determine if it can be satisfied and recognized as revenue at a point in time or over time. Typically, performance obligations consisting of a transfer of a license or the achievement of milestones are recognized at a point in time upon the transfer, while performance obligations consisting of research activities are recognized over time using an input method which is representative of the Company’s efforts to fulfill the performance obligation, based on costs incurred with third-parties or internal labor hours performed. Grant Revenue The Company has been awarded a grant from the Congressionally Directed Medical Research Program, or CDMRP, funded through the DoD, under which the Company’s internal costs specifically covered by the grant for a specified project are subject to reimbursement when incurred. Since there is no transfer of control of goods or services to the granting agency, revenue is recognized as the Company incurs expenses related to the grant in the gross amount of the reimbursement and costs associated with these reimbursements are reflected as a component of research and development expense in the consolidated statements of operations. |
Accrued Research and Development and Clinical Trial Costs | Accrued Research and Development and Clinical Trial Costs Research and development costs are expensed as incurred and include the cost of compensation and related expenses, as well as expenses for third parties who conduct research and development on the Company’s behalf, pursuant to development and consulting agreements in place. The Company’s preclinical studies and clinical trials are performed internally, by third party contract research organizations, or CROs, and/or clinical investigators. The Company also engages with CDMOs for clinical supplies and manufacturing scale-up activities related to its therapeutic candidates. Invoicing from these third parties may be monthly based upon services performed or based upon milestones achieved. The Company accrues these expenses based upon its assessment of the status of each clinical trial and the work completed, and upon information obtained from the CROs and CDMOs. The Company’s estimates are dependent upon the timeliness and accuracy of data provided by the CROs and CDMOs regarding the status and cost of the studies. Costs incurred related to the Company’s purchases of in-process research and development for early-stage products or products that are not commercially viable and ready for use, or have no alternative future use, are charged to expense in the period incurred. Costs incurred related to the licensing of products that have not yet received marketing approval to be marketed, or that are not commercially viable and ready for use, or have no alternative future use, are charged to expense in the period incurred. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income taxes are recorded for temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities reflect the tax rates expected to be in effect for the years in which the differences are expected to reverse. A valuation allowance is provided if it is more likely than not that some or all of the deferred tax assets will not be realized. The Company also follows the provisions of accounting for uncertainty in income taxes which prescribes a model for the recognition and measurement of a tax position taken or expected to be taken in a tax return, and provides guidance on derecognition, classification, interest and penalties, disclosure and transition. |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the same period. Diluted net loss per share is computed by dividing net loss by the weighted average number of common and common equivalent shares outstanding during the same period. The Company excludes common stock equivalents from the calculation of diluted net loss per share when the effect is anti-dilutive. |
Fair Value of Stock-Based Awards | Fair Value of Stock-Based Awards The Company recognizes compensation costs related to stock options based on the estimated fair value of the awards on the date of grant. The Company estimates the grant date fair value, and the resulting stock-based compensation expense, using the Black-Scholes option pricing model. The grant date fair value of the stock-based awards is generally recognized on a straight-line basis over the requisite service period, which is generally the vesting period of the respective awards. The Company recognizes forfeitures as they occur. |
Other Comprehensive Income | Other Comprehensive Income The Company has no material components of other comprehensive loss and accordingly, net loss is equal to comprehensive loss in all periods presented. |
Segment Information | Segment Information The Company operates under one segment which develops biologic therapeutic candidates. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies. Unless otherwise stated, the Company believes that the impact of the recently issued accounting pronouncements that are not yet effective will not have a material impact on its consolidated financial condition or results of operations upon adoption. Adoption of New Accounting Pronouncements In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options , which intends to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. The Company adopted ASU 2021-04 on January 1, 2022, which did not result in a material impact on its consolidated financial statements and related disclosures. In December 2022, the FASB issued ASU 2022-06, Deferral of the Sunset Date of Topic 848 , which defers the expiration date of Topic 848 as established with ASU 2020-04. In March 2020, the FASB issued ASU 2020-04, which provided temporary, optional expedients related to the accounting for contract modifications and hedging transactions as a result of the global markets’ anticipated transition away from the use of LIBOR and other interbank offered rates to alternative reference rates. The FASB established a December 31, 2022 expiration date for ASC 848. Following the extension of the intended cessation date of LIBOR in the United States to June 30, 2023, the FASB issued ASU 2022-06 to defer the expiration date of ASC 848 to December 31, 2024. ASU 2022-06 is effective upon issuance. The Company adopted ASU 2022-06 upon its issuance, which did not result in a material impact on its consolidated financial statements and related disclosures. Accounting Standards Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses : Measurement of Credit Losses on Financial Statements (Topic 362), which intends to improve financial reporting by requiring earlier recognition of credit losses on certain financial assets, such as available-for-sale debt securities. Subsequent to the issuance of ASU 2016-13, the FASB issued several additional ASUs to clarify implementation guidance, provide narrow-scope improvements and provide additional disclosure guidance. In November 2019, the FASB issued an amendment making this ASU effective for fiscal years beginning after December 15, 2022 for smaller reporting companies. The Company was a smaller reporting company at the determination date, and therefore the new standard will be effective for the Company on January 1, 2023. The Company is currently evaluating the potential impact that the adoption of ASU 2016-13 may have on its consolidated financial statements and related disclosures. |
ORGANIZATION AND SUMMARY OF S_3
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Potential Dilutive Securities Excluded from Diluted Loss Per Share | Potentially dilutive securities not included in the calculation of diluted net loss per share, because to do so would be anti-dilutive, are as follows (in thousands): AS OF DECEMBER 31, 2022 2021 Outstanding stock options 5,305 4,064 Warrant to purchase common stock 47 7 5,352 4,071 |
OTHER FINANCIAL INFORMATION (Ta
OTHER FINANCIAL INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Prepaid Expense and Other Current Assets | Prepaid expense and other current assets were comprised of the following (in thousands): AS OF DECEMBER 31, 2022 2021 Outside research and development services $ 5,697 $ 6,343 Other 674 590 Prepaid expense and other current assets $ 6,371 $ 6,933 |
Schedule of Property and Equipment | Property and equipment, net were comprised of the following (in thousands): AS OF DECEMBER 31, 2022 2021 Laboratory and office equipment $ 7,023 $ 6,286 Furniture, fixtures and other 524 514 Leasehold improvements 441 441 Computer software 53 42 Construction in process — 281 Total property and equipment 8,041 7,564 Less: accumulated depreciation and amortization (5,540) (4,411) Property and equipment, net $ 2,501 $ 3,153 Depreciation and amortization expense totaled $1.2 million for each of the years ended December 31, 2022 and December 31, 2021, and consisted of the following (in thousands): YEAR ENDED DECEMBER 31, 2022 2021 Research and development $ 1,003 $ 1,003 General and administrative 222 192 Total depreciation and amortization expense $ 1,225 $ 1,195 |
Schedule of Accrued Expenses | Accrued Expenses Accrued expenses were comprised of the following (in thousands): AS OF DECEMBER 31, 2022 2021 Clinical drug substance and product manufacturing (1) $ 5,381 $ 1,564 Clinical trials (2) 4,527 4,496 Compensation expense 3,374 1,322 Interest expense 2,124 480 Other outside research and development 1,164 1,329 Professional fees 428 261 Other 226 169 Accrued expenses $ 17,224 $ 9,621 (1) Relates primarily to the Company’s usage of third-party CDMOs for clinical and development efforts. See Note 1 for further discussion of the components of research and development. |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | The Company’s outstanding debt balance under the Amended 2020 Loan Agreement consisted of the following as of December 31, 2022 and December 31, 2021 (in thousands). AS OF DECEMBER 31, 2022 2021 Term A $ 10,900 $ 10,900 Term B 21,800 21,800 Term C 43,600 43,600 Term D 43,600 — Term E 32,700 — Term F 32,700 — Term G 32,700 — Less: debt discount (15,931) (5,830) Long-term debt, including debt discount and final payment fee $ 202,069 $ 70,470 |
Schedule of Maturities of Long-term Debt | Future principal payments and final fee payments will be made as follows (in thousands): AS OF DECEMBER 31, 2022 2025 $ 86,956 2026 104,348 2027 26,696 Total future minimum payments 218,000 Less: unamortized debt discount (15,931) Total debt $ 202,069 |
EQUITY COMPENSATION PLANS (Tabl
EQUITY COMPENSATION PLANS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock Options Activity | A summary of the Company’s stock option activity under its 2017 Plan for the year ended December 31, 2022 is as follows (in thousands, except for per share data and years): Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (In Years) Aggregate Intrinsic Value Outstanding as of December 31, 2021 4,064 $ 22.19 Granted 1,916 $ 24.95 Forfeited (434) $ 31.00 Exercised (241) $ 11.46 Outstanding as of December 31, 2022 5,305 $ 22.95 8.0 $ 29,365 Vested and exercisable as of December 31, 2022 2,293 $ 19.03 6.8 $ 19,247 |
Schedule of Weighted-Average Assumptions Used to Estimate Fair Value | The weighted-average assumptions used by the Company to estimate the fair value of stock option grants using the Black-Scholes option pricing model, as well as the resulting weighted-average fair value for the years ended December 31, 2022 and December 31, 2021 were as follows. YEAR ENDED DECEMBER 31, 2022 2021 Risk-free interest rate 2.63 % 0.71 % Expected volatility 85.26 % 93.49 % Expected dividend yield — % — % Expected term 6.08 6.08 Weighted average fair value $ 17.72 $ 24.20 |
Schedule of Stock-Based Compensation Expense | Stock-based compensation expense for stock options consisted of the following (in thousands): YEAR ENDED DECEMBER 31, 2022 2021 Research and development $ 14,513 $ 11,830 General and administrative 5,937 3,218 Total stock-based compensation expense $ 20,450 $ 15,048 |
LICENSE AND GRANT REVENUES (Tab
LICENSE AND GRANT REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Abstract] | |
Schedule of License and Grant Revenue | The following table summarizes the total revenue recorded in the Company’s consolidated statements of operations (in thousands): YEAR ENDED DECEMBER 31, 2022 2021 License fee revenue Phylaxis BioScience, LLC $ 1,101 $ 2,392 Chiesi Farmaceutici S.p.A. 877 533 2seventy bio, Inc. 200 4,200 Total license fee revenue 2,178 7,125 Grant revenue Congressionally Directed Medical Research Program 14 106 Total grant revenue 14 106 Total revenue $ 2,192 $ 7,231 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The components of income tax expense (benefit) were as follows for the years ended December 31, 2022 and December 31, 2021, respectively (in thousands): YEAR ENDED DECEMBER 31, 2022 2021 Current expense: State $ 3 $ 2 Total current expense $ 3 $ 2 |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of income tax expense to the amount computed by applying the statutory federal income tax rate to the loss from operations is summarized for the years ended December 31, 2022 and December 31, 2021 as follows (in thousands): YEAR ENDED DECEMBER 31, 2022 2021 Expected income tax benefit at federal statutory rate $ (30,497) $ (17,171) State income tax expense (benefit), net of federal benefit (2,495) (1,006) Permanent items 583 (207) R&D credits (1,261) (1,912) Unrecognized tax benefits (FIN 48) 751 691 Return to provision true-ups (135) 165 Valuation allowance 33,057 19,442 Income tax expense $ 3 $ 2 |
Schedule of Deferred Tax Assets and Liabilities | The components of net deferred income taxes were as follows (in thousands): AS OF DECEMBER 31, 2022 2021 Deferred income tax assets Net operating loss carryforward $ 52,970 $ 43,440 Research and development credits 9,728 8,539 Intangibles 3,684 3,875 Accruals 696 257 Stock compensation 5,130 1,888 Capitalized research and development costs 19,585 — Deferred revenue 37 456 Operating lease liabilities 1,118 1,428 Other — 14 Gross deferred tax assets 92,948 59,897 Less: Valuation allowance (91,586) (58,528) Total deferred tax assets 1,362 1,369 Deferred income tax liabilities Fixed assets (35) (20) Operating lease right-of-use assets (1,048) (1,349) Other (279) — Total deferred tax liabilities (1,362) (1,369) Net deferred tax assets (liabilities) $ — $ — |
Schedule of Unrecognized Tax Benefits Roll Forward | The following table summarizes the activity related to the Company’s unrecognized tax benefits (in thousands): AS OF DECEMBER 31, 2022 2021 Beginning balance $ 2,846 $ 2,155 Increases related to current year tax positions 751 691 Ending balance $ 3,597 $ 2,846 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of Operating Lease, by Balance Sheet Location | The operating right-of-use asset and operating lease liability as of December 31, 2022 and December 31, 2021 are as follows (in thousands): AS OF DECEMBER 31, 2022 2021 Operating right-of-use asset $ 4,717 $ 6,338 Operating lease liability Current 1,860 1,674 Non-current 3,173 5,033 Total operating lease liability $ 5,033 $ 6,707 |
Schedule of Operating Lease Maturity | Future minimum payments for the Company’s operating leases reconciled to the lease liability are as follows (in thousands): AS OF DECEMBER 31, 2022 2023 $ 2,203 2024 2,247 2025 1,137 Total future minimum lease payments $ 5,587 Less: imputed interest (554) Present value of operating lease liability 5,033 Less: current portion of operating lease liability (1,860) Non-current portion of operating lease liability $ 3,173 |
ORGANIZATION AND SUMMARY OF S_4
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) | 12 Months Ended | |||||
Dec. 31, 2022 USD ($) lease segment | Oct. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Nov. 30, 2021 USD ($) | Dec. 31, 2020 USD ($) | Jul. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||||||
Accumulated deficit | $ 372,373,000 | $ 227,147,000 | ||||
Cash and cash equivalents | 273,865,000 | 131,301,000 | ||||
Amortized cost | $ 196,300,000 | |||||
Number of operating leases held | lease | 2 | |||||
Deferred offering costs | $ 0 | $ 3,000,000 | 0 | $ 1,700,000 | ||
Number of operating segments | segment | 1 | |||||
Minimum | Laboratory and office equipment | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Property and equipment useful life | 3 years | |||||
Maximum | Laboratory and office equipment | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Property and equipment useful life | 5 years | |||||
Maximum | Furniture, fixtures and other | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Property and equipment useful life | 5 years | |||||
Maximum | Computer software | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Property and equipment useful life | 3 years | |||||
Phylaxis BioScience, LLC | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Equity interest percentage | 10% | |||||
Equity method investment | $ 0 | $ 0 | $ 0 |
ORGANIZATION AND SUMMARY OF S_5
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Potential Dilutive Securities (Details) - shares shares in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Antidilutive securities excluded from earnings per share computation (in shares) | 5,352 | 4,071 |
Outstanding stock options | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Antidilutive securities excluded from earnings per share computation (in shares) | 5,305 | 4,064 |
Warrant to purchase common stock | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Antidilutive securities excluded from earnings per share computation (in shares) | 47 | 7 |
OTHER FINANCIAL INFORMATION - P
OTHER FINANCIAL INFORMATION - Prepaid Expense and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Outside research and development services | $ 5,697 | $ 6,343 |
Other | 674 | 590 |
Prepaid expense and other current assets | $ 6,371 | $ 6,933 |
OTHER FINANCIAL INFORMATION -_2
OTHER FINANCIAL INFORMATION - Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 8,041 | $ 7,564 |
Less: accumulated depreciation and amortization | (5,540) | (4,411) |
Property and equipment, net | 2,501 | 3,153 |
Depreciation and amortization | 1,225 | 1,195 |
Laboratory and office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 7,023 | 6,286 |
Furniture, fixtures and other | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 524 | 514 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 441 | 441 |
Computer software | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 53 | 42 |
Construction in process | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 0 | $ 281 |
OTHER FINANCIAL INFORMATION - D
OTHER FINANCIAL INFORMATION - Depreciation and Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation and amortization | $ 1,225 | $ 1,195 |
Research and development | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation and amortization | 1,003 | 1,003 |
General and administrative | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation and amortization | $ 222 | $ 192 |
OTHER FINANCIAL INFORMATION - A
OTHER FINANCIAL INFORMATION - Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Clinical drug substance and product manufacturing | $ 5,381 | $ 1,564 |
Clinical trials | 4,527 | 4,496 |
Compensation expense | 3,374 | 1,322 |
Interest expense | 2,124 | 480 |
Other outside research and development | 1,164 | 1,329 |
Professional fees | 428 | 261 |
Other | 226 | 169 |
Accrued expenses | $ 17,224 | $ 9,621 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) $ / shares in Units, shares in Thousands | 1 Months Ended | 12 Months Ended | ||||||
Oct. 31, 2022 USD ($) | Jun. 30, 2022 USD ($) | Feb. 28, 2022 USD ($) tranche $ / shares shares | Jun. 30, 2021 USD ($) | Nov. 30, 2020 USD ($) | Jul. 31, 2020 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Debt Instrument [Line Items] | ||||||||
Proceeds from the issuance of debt | $ 128,863,000 | $ 39,992,000 | ||||||
Reclassification of warrant liabilities into equity | 712,000 | |||||||
Amended 2020 Oxford Term Loan Tranche One | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from the issuance of debt | $ 10,000,000 | |||||||
Amended 2020 Oxford Term Loan Tranche Two | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from the issuance of debt | $ 20,000,000 | |||||||
Amended 2020 Oxford Term Loan June 2021 Amendment | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from the issuance of debt | $ 40,000,000 | |||||||
Minimum cash balance | 20,000,000 | |||||||
Amended 2022 Oxford Term Loan | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from the issuance of debt | $ 40,000,000 | |||||||
Legal and amendment fees | $ 1,100,000 | |||||||
Number of additional tranches available upon contingent events | tranche | 3 | |||||||
Amended 2022 Oxford Term Loan | Secured Debt | Warrants Issued Concurrently With 2022 Loan Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Warrants issued (in shares) | shares | 40 | |||||||
Warrant price (in dollars per share) | $ / shares | $ 45 | |||||||
Reclassification of warrant liabilities into equity | $ 700,000 | |||||||
Amended 2020 Oxford Term Loan February 2022 Amendment Tranche One | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from the issuance of debt | $ 30,000,000 | |||||||
Amended 2020 Oxford Term Loan February 2022 Amendment Tranche Two | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from the issuance of debt | $ 30,000,000 | |||||||
Amended 2020 Oxford Term Loan October 2022 Amendment | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from the issuance of debt | $ 30,000,000 | |||||||
Term loan aggregate amount | $ 30,000,000 | |||||||
Amended 2020 Oxford Term Loan | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Total long-term debt | $ 200,000,000 | |||||||
Annual interest rate | 8.30% | |||||||
Equal payments of principal and interest period if interest only period is extended | 23 months | |||||||
Upfront licensing or partnership proceeds raised | $ 100,000,000 | |||||||
Equal payments of principal period if interest only period is extended | 11 months | |||||||
Percentage of principal amount for final payment | 9% | |||||||
Periodic payment terms, final payment amount | $ 18,000,000 | |||||||
Amended 2020 Oxford Term Loan | Secured Debt | LIBOR | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 8.19% | |||||||
2020 Loan Agreement | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt interest expense | $ 18,200,000 | 5,400,000 | ||||||
Amortization of debt discount and accretion | $ 3,400,000 | $ 1,200,000 | ||||||
2020 Loan Agreement | Secured Debt | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Prepayment fee | 1% | |||||||
2020 Loan Agreement | Secured Debt | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Prepayment fee | 3% |
DEBT - Outstanding Debt Balance
DEBT - Outstanding Debt Balance 2020 Loan Agreement (Details) - Secured Debt - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
2022 Loan A | ||
Debt Instrument [Line Items] | ||
Term loan | $ 10,900 | |
2020 Term A | ||
Debt Instrument [Line Items] | ||
Term loan | $ 10,900 | |
2022 Loan B | ||
Debt Instrument [Line Items] | ||
Term loan | 21,800 | |
2020 Term B | ||
Debt Instrument [Line Items] | ||
Term loan | 21,800 | |
2022 Loan C | ||
Debt Instrument [Line Items] | ||
Term loan | 43,600 | |
2020 Term C | ||
Debt Instrument [Line Items] | ||
Term loan | 43,600 | |
2022 Loan D | ||
Debt Instrument [Line Items] | ||
Term loan | 43,600 | |
2020 Term D | ||
Debt Instrument [Line Items] | ||
Term loan | 0 | |
2022 Loan E | ||
Debt Instrument [Line Items] | ||
Term loan | 32,700 | |
2020 Term E | ||
Debt Instrument [Line Items] | ||
Term loan | 0 | |
2022 Loan F | ||
Debt Instrument [Line Items] | ||
Term loan | 32,700 | |
2020 Term F | ||
Debt Instrument [Line Items] | ||
Term loan | 0 | |
2022 Loan G | ||
Debt Instrument [Line Items] | ||
Term loan | 32,700 | |
2020 Term G | ||
Debt Instrument [Line Items] | ||
Term loan | 0 | |
2022 Loan Agreement | ||
Debt Instrument [Line Items] | ||
Less: debt discount | (15,931) | |
Total debt | $ 202,069 | |
2020 Loan Agreement | ||
Debt Instrument [Line Items] | ||
Less: debt discount | (5,830) | |
Total debt | $ 70,470 |
DEBT - Future Minimum Payments
DEBT - Future Minimum Payments (Details) - 2022 Oxford Term Loans - Secured Debt $ in Thousands | Dec. 31, 2022 USD ($) |
Debt Instrument [Line Items] | |
2025 | $ 86,956 |
2026 | 104,348 |
2027 | 26,696 |
Total future minimum payments | 218,000 |
Less: unamortized debt discount | (15,931) |
Total debt | $ 202,069 |
STOCKHOLDERS_ EQUITY (Details)
STOCKHOLDERS’ EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Feb. 28, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 21, 2020 | |
Temporary Equity [Line Items] | |||||
Common stock, shares authorized (in shares) | 120,000,000 | 120,000,000 | 120,000,000 | ||
Preferred stock, shares authorized (in shares) | 15,000,000 | 15,000,000 | 15,000,000 | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||
Aggregate offering price | $ 200,000 | ||||
Commission percent | 3% | 2% | |||
Reclassification of warrant liabilities into equity | $ 712 | ||||
Additional Paid-in Capital | |||||
Temporary Equity [Line Items] | |||||
Reclassification of warrant liabilities into equity | $ 712 | ||||
Amended 2022 Oxford Term Loan | Secured Debt | |||||
Temporary Equity [Line Items] | |||||
Commissions costs | $ 1,100 | ||||
Warrants Issued Upon Consummation of IPO | 2020 Loan Agreement | Secured Debt | |||||
Temporary Equity [Line Items] | |||||
Warrants exercisable for shares of common stock (in shares) | 7,354 | ||||
Warrant price (in dollars per share) | $ 17 | ||||
Warrants Issued Upon Consummation of IPO | 2020 Loan Agreement | Secured Debt | Additional Paid-in Capital | |||||
Temporary Equity [Line Items] | |||||
Reclassification of warrant liabilities into equity | $ 100 | ||||
Warrants Issued Concurrently With 2022 Loan Agreement | Amended 2022 Oxford Term Loan | Secured Debt | |||||
Temporary Equity [Line Items] | |||||
Warrant price (in dollars per share) | $ 45 | ||||
Reclassification of warrant liabilities into equity | $ 700 | ||||
Warrants issued (in shares) | 40,000 | ||||
Warrants Issued Concurrently With 2022 Loan Agreement | Amended 2022 Oxford Term Loan | Secured Debt | Additional Paid-in Capital | |||||
Temporary Equity [Line Items] | |||||
Reclassification of warrant liabilities into equity | $ 700 | ||||
Sales Agreement | |||||
Temporary Equity [Line Items] | |||||
Common stock shares sold (in shares) | 4,332,354 | 921,042 | |||
Sale of stock, proceeds received | $ 127,400 | $ 40,200 | |||
Commissions costs | 2,600 | 1,200 | |||
Costs associated with the ATM offering | $ 400 | $ 400 |
EQUITY COMPENSATION PLANS - Nar
EQUITY COMPENSATION PLANS - Narrative (Details) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock reserved for issuance (in shares) | 6.1 | |
Available shares reserved for issuance (in shares) | 0.2 | |
Aggregate intrinsic value of options exercised | $ 3.7 | $ 7.5 |
Total fair value of stock options | $ 25 | $ 5.6 |
Employee Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 4 years | |
Contractual term | 10 years | |
Unrecognized stock-based compensation expense | $ 51.7 | |
Weighted-average period of recognition | 2 years 8 months 12 days | |
Employee Stock Option | Cliff Vesting | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 1 year |
EQUITY COMPENSATION PLANS - Sto
EQUITY COMPENSATION PLANS - Stock Option Activity (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
Number of Shares | |
Outstanding, beginning balance (in shares) | shares | 4,064 |
Granted (in shares) | shares | 1,916 |
Forfeited (in shares) | shares | (434) |
Exercised (in shares) | shares | (241) |
Outstanding, ending balance (in shares) | shares | 5,305 |
Vested and exercisable (in shares) | shares | 2,293 |
Weighted Average Exercise Price | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 22.19 |
Granted (in dollars per share) | $ / shares | 24.95 |
Forfeited (in dollars per share) | $ / shares | 31 |
Exercised (in dollars per share) | $ / shares | 11.46 |
Outstanding, ending balance (in dollars per share) | $ / shares | 22.95 |
Vested and exercisable (in dollars per share) | $ / shares | $ 19.03 |
Weighted Average Remaining Contractual Term (In Years) | 8 years |
Weighted Average Remaining Contractual Term, Vested and Exercisable | 6 years 9 months 18 days |
Aggregate Intrinsic Value | $ | $ 29,365 |
Aggregate Intrinsic Value, Vested and Exercisable | $ | $ 19,247 |
EQUITY COMPENSATION PLANS - Fai
EQUITY COMPENSATION PLANS - Fair Value of Stock Option Grants (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average fair value (in dollars per share) | $ 17.72 | $ 24.20 |
Employee Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate | 2.63% | 0.71% |
Expected volatility | 85.26% | 93.49% |
Expected dividend yield | 0% | 0% |
Expected term | 6 years 29 days | 6 years 29 days |
EQUITY COMPENSATION PLANS - S_2
EQUITY COMPENSATION PLANS - Stock-based Compensation Expense (Details) - Employee Stock Option - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation expense | $ 20,450 | $ 15,048 |
Research and development | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation expense | 14,513 | 11,830 |
General and administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation expense | $ 5,937 | $ 3,218 |
LICENSE AND GRANT REVENUES - Re
LICENSE AND GRANT REVENUES - Revenue Summary (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||
Total revenue | $ 2,192 | $ 7,231 |
License fee revenue | ||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||
Total revenue | 2,178 | 7,125 |
License fee revenue | Phylaxis BioScience, LLC | ||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||
Total revenue | 1,101 | 2,392 |
License fee revenue | Chiesi Farmaceutici S.p.A. | ||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||
Total revenue | 877 | 533 |
License fee revenue | 2seventy bio, Inc. | ||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||
Total revenue | 200 | 4,200 |
Grant revenue | ||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||
Total revenue | 14 | 106 |
Grant revenue | Congressionally Directed Medical Research Program | ||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||
Total revenue | $ 14 | $ 106 |
LICENSE AND GRANT REVENUES - Li
LICENSE AND GRANT REVENUES - License and Collaboration Agreements (Details) | 1 Months Ended | 12 Months Ended | ||||||||||
Jun. 30, 2022 USD ($) program | Oct. 31, 2021 USD ($) | Aug. 31, 2021 USD ($) | Jul. 31, 2021 USD ($) | May 31, 2021 USD ($) | Jul. 31, 2020 USD ($) performanceObligation compound | Jun. 30, 2020 USD ($) program performanceObligation | Aug. 31, 2019 USD ($) performanceObligation | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 20, 2018 USD ($) | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Current portion of deferred revenue | $ 166,000 | $ 2,034,000 | ||||||||||
Non-current portion of deferred revenue | 0 | 110,000 | ||||||||||
Total revenue | 2,192,000 | 7,231,000 | ||||||||||
License fee revenue | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Total revenue | 2,178,000 | 7,125,000 | ||||||||||
Phylaxis BioScience, LLC | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Equity interest percentage | 10% | |||||||||||
Additional equity interest percentage entitled to receive | 5% | |||||||||||
Equity method investment | 0 | 0 | $ 0 | |||||||||
Phylaxis BioScience, LLC | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Nonrefundable, upfront payment | $ 2,500,000 | |||||||||||
Additional payable due from agreement | $ 2,500,000 | |||||||||||
Additional payment receivable period | 180 days | |||||||||||
Development milestone payment receivable | $ 225,000,000 | |||||||||||
Commercialization milestone payment receivable | 175,000,000 | |||||||||||
Equity method investment | 500,000 | |||||||||||
Payments due pursuant to agreement | $ 5,000,000 | |||||||||||
Number of performance obligations | performanceObligation | 1 | |||||||||||
Number of compounds | compound | 2 | |||||||||||
Current portion of deferred revenue | 0 | 1,100,000 | ||||||||||
Phylaxis BioScience, LLC | License fee revenue | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Revenue recognized related to performance obligation | 1,100,000 | 2,400,000 | ||||||||||
Total revenue | 1,101,000 | 2,392,000 | ||||||||||
Phylaxis BioScience, LLC | License Agreement, Payment Received October 2020 | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Additional payable due from agreement | $ 1,250,000 | |||||||||||
Phylaxis BioScience, LLC | License Agreement, Payment Received January 2021 | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Additional payable due from agreement | $ 1,250,000 | |||||||||||
Chiesi Farmaceutici S.p.A. | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Nonrefundable, upfront payment | $ 10,000,000 | |||||||||||
Additional payable due from agreement | $ 12,500,000 | |||||||||||
Number of performance obligations | performanceObligation | 1 | |||||||||||
Current portion of deferred revenue | 100,000 | 900,000 | ||||||||||
Milestone payments receivable | $ 122,500,000 | |||||||||||
Term of research and development services option period | 60 days | |||||||||||
Non-current portion of deferred revenue | 100,000 | |||||||||||
Chiesi Farmaceutici S.p.A. | License fee revenue | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Revenue recognized related to performance obligation | 900,000 | 500,000 | ||||||||||
Total revenue | 877,000 | 533,000 | ||||||||||
2seventy bio, Inc. | License fee revenue | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Total revenue | 200,000 | 4,200,000 | ||||||||||
2seventy bio, Inc. | 2018 Option and License Agreement | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Development milestone payment receivable | $ 51,500,000 | |||||||||||
2seventy bio, Inc. | 2018 Option and License Agreement | License fee revenue | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Total revenue | $ 2,000,000 | 0 | 2,000,000 | |||||||||
Milestone payment received | $ 2,000,000 | |||||||||||
2seventy bio, Inc. | Initial Programs | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Nonrefundable, upfront payment | $ 400,000 | |||||||||||
Number of performance obligations | performanceObligation | 1 | |||||||||||
Number of programs related to collaborative agreement | program | 3 | 2 | ||||||||||
2seventy bio, Inc. | Additional Programs | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Number of programs related to collaborative agreement | program | 8 | |||||||||||
2seventy bio, Inc. | Initial Programs, Program 1 | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Nonrefundable, upfront payment | $ 200,000 | |||||||||||
2seventy bio, Inc. | Initial Programs, Program 2 | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Nonrefundable, upfront payment | 200,000 | |||||||||||
2seventy bio, Inc. | Initial Programs, Program 3 | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Nonrefundable, upfront payment | $ 200,000 | |||||||||||
2seventy bio, Inc. | 2020 Option And License Agreement | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Development milestone payment receivable | $ 51,500,000 | |||||||||||
Project extension term | 6 months | |||||||||||
Option extension fee | $ 2,100,000 | $ 100,000 | ||||||||||
2seventy bio, Inc. | 2020 Option And License Agreement | License fee revenue | ||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | ||||||||||||
Total revenue | $ 2,100,000 | $ 100,000 | $ 200,000 | $ 2,200,000 |
LICENSE AND GRANT REVENUES - Go
LICENSE AND GRANT REVENUES - Government Grants (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Feb. 28, 2021 | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||
Total revenue | $ 2,192 | $ 7,231 | |
Grant revenue | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||
Total revenue | 14 | 106 | |
Congressionally Directed Medical Research Program, 2021 Grant | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||
Grant award | $ 300 | ||
Congressionally Directed Medical Research Program | Grant revenue | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions Line Items | |||
Total revenue | $ 14 | $ 106 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Elpiscience Biopharmaceuticals, Inc. | OX40 License Agreement | ||
Related Party Transaction [Line Items] | ||
Reimbursement expenses | $ 200 | |
Reimbursement for related party transaction expenses incurred to date | 5,400 | |
Liabilities derecognized from agreements | 32 | |
Elpiscience Biopharmaceuticals, Inc. | OX40 License Agreement | Cost Sharing Agreement | ||
Related Party Transaction [Line Items] | ||
Reimbursement expenses | 300 | $ 200 |
Reimbursement for related party transaction expenses incurred to date | 500 | |
Elpiscience Biopharmaceuticals, Inc. | PD-L1 and 4-1BB License Agreement | ||
Related Party Transaction [Line Items] | ||
Liabilities derecognized from agreements | $ 14 | |
LAV Summit Limited | Affiliates | ||
Related Party Transaction [Line Items] | ||
Ownership interest, more than | 5% |
INCOME TAXES - Components of In
INCOME TAXES - Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
State | $ 3 | $ 2 |
Provision for income taxes | $ 3 | $ 2 |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Expected income tax benefit at federal statutory rate | $ (30,497) | $ (17,171) |
State income tax expense (benefit), net of federal benefit | (2,495) | (1,006) |
Permanent items | 583 | (207) |
R&D credits | (1,261) | (1,912) |
Unrecognized tax benefits (FIN 48) | 751 | 691 |
Return to provision true-ups | (135) | 165 |
Valuation allowance | 33,057 | 19,442 |
Provision for income taxes | $ 3 | $ 2 |
INCOME TAXES - Components of Ne
INCOME TAXES - Components of Net Deferred Income Taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred income tax assets | ||
Net operating loss carryforward | $ 52,970 | $ 43,440 |
Research and development credits | 9,728 | 8,539 |
Intangibles | 3,684 | 3,875 |
Accruals | 696 | 257 |
Stock compensation | 5,130 | 1,888 |
Capitalized research and development costs | 19,585 | 0 |
Deferred revenue | 37 | 456 |
Operating lease liabilities | 1,118 | 1,428 |
Other | 0 | 14 |
Gross deferred tax assets | 92,948 | 59,897 |
Less: Valuation allowance | (91,586) | (58,528) |
Total deferred tax assets | 1,362 | 1,369 |
Deferred income tax liabilities | ||
Fixed assets | (35) | (20) |
Operating lease right-of-use assets | (1,048) | (1,349) |
Other | (279) | 0 |
Total deferred tax liabilities | (1,362) | (1,369) |
Net deferred tax assets (liabilities) | 0 | 0 |
Net deferred tax assets (liabilities) | $ 0 | $ 0 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Tax Credit Carryforward [Line Items] | |||
Deferred tax asset valuation allowance | $ 91,586,000 | $ 58,528,000 | |
Gross unrecognized tax benefits | 3,597,000 | 2,846,000 | $ 2,155,000 |
Accrual for interest and penalties | 0 | 0 | |
Recognized interest and penalties | 0 | $ 0 | |
Federal | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | 240,800,000 | ||
Federal | Research Tax Credit Carryforward | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforward | 9,300,000 | ||
State | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | 34,100,000 | ||
State | Research Tax Credit Carryforward | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforward | $ 5,100,000 |
INCOME TAXES - Unrecognized Tax
INCOME TAXES - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Unrecognized Tax Benefits [Roll Forward] | ||
Beginning balance | $ 2,846 | $ 2,155 |
Increases related to current year tax positions | 751 | 691 |
Ending balance | $ 3,597 | $ 2,846 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | May 31, 2019 | Sep. 30, 2017 | |
Leases [Abstract] | ||||
Lease agreement term | 7 years | |||
Lease extension term | 5 years | |||
Initial base rent per month | $ 30 | $ 100 | ||
Annual escalations | 2% | 2% | ||
Operating lease expense | $ 3,400 | $ 3,200 | ||
Payments included in measurement of lease liability | $ 2,200 | $ 2,200 | ||
Remaining term of operating lease | 2 years 6 months | 3 years 6 months | ||
Weighted-average discount rate | 8.20% | 8.20% |
LEASES - Schedule of Right-Of-U
LEASES - Schedule of Right-Of-Use Asset and Operating Lease Liability (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Operating right-of-use asset | $ 4,717 | $ 6,338 |
Operating lease liability | ||
Current | 1,860 | 1,674 |
Non-current | 3,173 | 5,033 |
Present value of operating lease liability | $ 5,033 | $ 6,707 |
LEASES - Schedule of Operating
LEASES - Schedule of Operating Lease Liability Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
2023 | $ 2,203 | |
2024 | 2,247 | |
2025 | 1,137 | |
Total future minimum lease payments | 5,587 | |
Less: imputed interest | (554) | |
Present value of operating lease liability | 5,033 | $ 6,707 |
Less: current portion of operating lease liability | (1,860) | (1,674) |
Non-current portion of lease liability | $ 3,173 | $ 5,033 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Purchase commitment, future period | 12 months | |
Purchase commitment | $ 74.8 | $ 2.4 |
Purchase commitment, expenses incurred | $ 0.3 | $ 1 |