Aprea Therapeutics (APRE) 10-Q 14 Nov 19 2019 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2019	Nov. 13, 2019
Document and Entity Information
Entity Registrant Name	Aprea Therapeutics, Inc.
Document Type	10-Q
Document Period End Date	Sep. 30, 2019
Entity Current Reporting Status	No
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		20,990,502
Entity Central Index Key	0001781983
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Amendment Flag	false

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 52,334,102	$ 65,675,931
Deferred offering costs	4,070,690
Prepaid expenses and other current assets	339,814	322,146
Total current assets	56,744,606	65,998,077
Property and equipment, net	31,032	24,450
Right of use lease asset	560,318
Other noncurrent assets	102	111
Total assets	57,336,058	66,022,638
Current liabilities:
Accounts payable	3,510,105	1,739,337
Accrued expenses	5,847,364	3,128,772
Lease liability-current	226,852
Total current liabilities	9,584,321	4,868,109
Lease liability-noncurrent	358,404
Total liabilities	9,942,725	4,868,109
Commitments and contingencies (Note 8)
Stockholders' equity (deficit):
Common stock, par value $0.001 at September 30, 2019 and $0.11 at December 31, 2018; 1,181,733 and 1,155,366, shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively.	1,182	127,091
Additional paid-in capital	20,346,849	19,666,588
Accumulated other comprehensive loss	(13,688,166)	(8,761,325)
Accumulated deficit	(77,455,525)	(62,468,456)
Total stockholders' deficit	(70,795,660)	(51,436,102)
Total liabilities, convertible preferred stock and stockholders' deficit	57,336,058	66,022,638
Convertible preferred stock
Convertible preferred stock:
Total convertible preferred stock	118,188,993	112,590,631
Series A convertible preferred stock
Convertible preferred stock:
Total convertible preferred stock	6,483,044	6,483,044
Series B convertible preferred stock
Convertible preferred stock:
Total convertible preferred stock	49,742,942	49,742,942
Series C convertible preferred stock
Convertible preferred stock:
Total convertible preferred stock	$ 61,963,007	$ 56,364,645

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Common stock, par value	$ 0.001	$ 0.11
Common stock, shares issued	1,181,733	1,155,366
Common stock, outstanding	1,181,733	1,155,366
Series A convertible preferred stock
Convertible preferred stock, par value	$ 0.001	$ 0.001
Convertible preferred stock, issued	612,446	612,446
Convertible preferred stock, outstanding	612,446	612,446
Convertible preferred stock, liquidation preference	$ 6,483,044
Series B convertible preferred stock
Convertible preferred stock, par value	$ 0.001	$ 0.001
Convertible preferred stock, issued	7,235,969	7,235,969
Convertible preferred stock, outstanding	7,235,969	7,235,969
Convertible preferred stock, liquidation preference	$ 62,288,856
Series C convertible preferred stock
Convertible preferred stock, par value	$ 0.001	$ 0.001
Convertible preferred stock, issued	5,179,877	4,712,698
Convertible preferred stock, outstanding	5,179,877	4,712,698
Convertible preferred stock, liquidation preference	$ 66,451,815

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Operating expenses:
Research and development	$ 4,910,409	$ 2,307,022	$ 12,908,679	$ 9,799,811
General and administrative	2,307,946	623,702	4,655,861	1,790,222
Total operating expenses	7,218,355	2,930,724	17,564,540	11,590,033
Other income (expense):
Interest expense	(6,098)	4	(13,537)	(184)
Foreign currency gain (loss)	975,034	(207,542)	2,591,008	741,616
Total other income (expense)	968,936	(207,538)	2,577,471	741,432
Net loss	(6,249,419)	(3,138,262)	(14,987,069)	(10,848,601)
Other comprehensive loss:
Foreign currency translation	(2,940,174)	65,800	(4,926,841)	(1,110,408)
Total comprehensive loss	$ (9,189,593)	$ (3,072,462)	$ (19,913,910)	$ (11,959,009)
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ (5.29)	$ (2.72)	$ (12.72)	$ (9.40)
Weighted average basic and diluted shares of common stock outstanding (in shares)	1,181,726	1,154,573	1,178,206	1,154,264

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders' Deficit - USD ($)	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Series A convertible preferred stock	Series B convertible preferred stock	Series C convertible preferred stock	Total
Temporary Equity, Beginning Balance at Dec. 31, 2017					$ 6,483,044	$ 49,742,942
Temporary Equity, Beginning Balance (in shares) at Dec. 31, 2017					612,446	7,235,969
Temporary Equity, Ending Balance at Jun. 30, 2018					$ 6,483,044	$ 49,742,942
Temporary Equity, Ending Balance (in shares) at Jun. 30, 2018					612,446	7,235,969
Equity, Beginning Balance at Dec. 31, 2017	$ 126,838	$ 19,335,560	$ (8,287,406)	$ (46,940,187)				$ (35,765,195)
Equity, Beginning Balance (in shares) at Dec. 31, 2017	1,153,061
Increase (Decrease) in Stockholders' Equity
Exercise of stock options	$ 165	1,250						1,415
Exercise of stock options (in shares)	1,503
Stock based compensation		169,854						169,854
Foreign currency translation			(1,176,208)					(1,176,208)
Net loss				(7,710,338)				(7,710,338)
Equity, Ending Balance at Jun. 30, 2018	$ 127,003	19,506,664	(9,463,614)	(54,650,525)				(44,480,472)
Equity, Ending Balance (in shares) at Jun. 30, 2018	1,154,564
Temporary Equity, Beginning Balance at Dec. 31, 2017					$ 6,483,044	$ 49,742,942
Temporary Equity, Beginning Balance (in shares) at Dec. 31, 2017					612,446	7,235,969
Temporary Equity, Ending Balance at Sep. 30, 2018					$ 6,483,044	$ 49,742,942
Temporary Equity, Ending Balance (in shares) at Sep. 30, 2018					612,446	7,235,969
Equity, Beginning Balance at Dec. 31, 2017	$ 126,838	19,335,560	(8,287,406)	(46,940,187)				(35,765,195)
Equity, Beginning Balance (in shares) at Dec. 31, 2017	1,153,061
Increase (Decrease) in Stockholders' Equity
Foreign currency translation								(1,110,408)
Net loss								(10,848,601)
Equity, Ending Balance at Sep. 30, 2018	$ 127,003	19,586,455	(9,397,814)	(57,788,787)				(47,473,143)
Equity, Ending Balance (in shares) at Sep. 30, 2018	1,154,564
Temporary Equity, Beginning Balance at Jun. 30, 2018					$ 6,483,044	$ 49,742,942
Temporary Equity, Beginning Balance (in shares) at Jun. 30, 2018					612,446	7,235,969
Temporary Equity, Ending Balance at Sep. 30, 2018					$ 6,483,044	$ 49,742,942
Temporary Equity, Ending Balance (in shares) at Sep. 30, 2018					612,446	7,235,969
Equity, Beginning Balance at Jun. 30, 2018	$ 127,003	19,506,664	(9,463,614)	(54,650,525)				(44,480,472)
Equity, Beginning Balance (in shares) at Jun. 30, 2018	1,154,564
Increase (Decrease) in Stockholders' Equity
Stock based compensation		79,791						79,791
Foreign currency translation			65,800					65,800
Net loss				(3,138,262)				(3,138,262)
Equity, Ending Balance at Sep. 30, 2018	$ 127,003	19,586,455	(9,397,814)	(57,788,787)				(47,473,143)
Equity, Ending Balance (in shares) at Sep. 30, 2018	1,154,564
Temporary Equity, Beginning Balance at Dec. 31, 2018					$ 6,483,044	$ 49,742,942	$ 56,364,645
Temporary Equity, Beginning Balance (in shares) at Dec. 31, 2018					612,446	7,235,969	4,712,698
Increase (Decrease) in Temporary Equity
Issuance of Series C convertible preferred stock, net of issuance costs of $53,509							$ 5,598,362
Issuance of Series C convertible preferred stock (in shares)							467,179
Temporary Equity, Ending Balance at Jun. 30, 2019					$ 6,483,044	$ 49,742,942	$ 61,963,007
Temporary Equity, Ending Balance (in shares) at Jun. 30, 2019					612,446	7,235,969	5,179,877
Equity, Beginning Balance at Dec. 31, 2018	$ 127,091	19,666,588	(8,761,325)	(62,468,456)				(51,436,102)
Equity, Beginning Balance (in shares) at Dec. 31, 2018	1,155,366
Increase (Decrease) in Stockholders' Equity
Exercise of stock options	$ 2,883	20,235						23,118
Exercise of stock options (in shares)	26,207
Stock based compensation		284,909						284,909
Foreign currency translation			(1,986,667)					(1,986,667)
Net loss				(8,737,650)				(8,737,650)
Equity, Ending Balance at Jun. 30, 2019	$ 129,974	19,971,732	(10,747,992)	(71,206,106)				(61,852,392)
Equity, Ending Balance (in shares) at Jun. 30, 2019	1,181,573
Temporary Equity, Beginning Balance at Dec. 31, 2018					$ 6,483,044	$ 49,742,942	$ 56,364,645
Temporary Equity, Beginning Balance (in shares) at Dec. 31, 2018					612,446	7,235,969	4,712,698
Temporary Equity, Ending Balance at Sep. 30, 2019					$ 6,483,044	$ 49,742,942	$ 61,963,007
Temporary Equity, Ending Balance (in shares) at Sep. 30, 2019					612,446	7,235,969	5,179,877
Equity, Beginning Balance at Dec. 31, 2018	$ 127,091	19,666,588	(8,761,325)	(62,468,456)				(51,436,102)
Equity, Beginning Balance (in shares) at Dec. 31, 2018	1,155,366
Increase (Decrease) in Stockholders' Equity
Foreign currency translation								(4,926,841)
Net loss								(14,987,069)
Equity, Ending Balance at Sep. 30, 2019	$ 1,182	20,346,849	(13,688,166)	(77,455,525)				(70,795,660)
Equity, Ending Balance (in shares) at Sep. 30, 2019	1,181,733
Temporary Equity, Beginning Balance at Jun. 30, 2019					$ 6,483,044	$ 49,742,942	$ 61,963,007
Temporary Equity, Beginning Balance (in shares) at Jun. 30, 2019					612,446	7,235,969	5,179,877
Temporary Equity, Ending Balance at Sep. 30, 2019					$ 6,483,044	$ 49,742,942	$ 61,963,007
Temporary Equity, Ending Balance (in shares) at Sep. 30, 2019					612,446	7,235,969	5,179,877
Equity, Beginning Balance at Jun. 30, 2019	$ 129,974	19,971,732	(10,747,992)	(71,206,106)				(61,852,392)
Equity, Beginning Balance (in shares) at Jun. 30, 2019	1,181,573
Increase (Decrease) in Stockholders' Equity
Issuance of common stock	$ 100							100
Issuance of common stock (in shares)	160
Stock based compensation		246,225						246,225
Foreign currency translation			(2,940,174)					(2,940,174)
Exchange and conversion of preferred stock and common stock of Aprea Therapeutics AB into common stock of Aprea Therapeutics Inc	$ (128,892)	128,892
Net loss				(6,249,419)				(6,249,419)
Equity, Ending Balance at Sep. 30, 2019	$ 1,182	$ 20,346,849	$ (13,688,166)	$ (77,455,525)				$ (70,795,660)
Equity, Ending Balance (in shares) at Sep. 30, 2019	1,181,733

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders' Deficit (Parenthetical)	6 Months Ended
	Jun. 30, 2019USD ($)
Series C convertible preferred stock
Convertible Preferred Stock, Issuance Costs	$ 53,509

Condensed Consolidated Statem_4

Condensed Consolidated Statements of Cash Flows - USD ($)	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Cash flows from operating activities:
Net loss	$ (14,987,069)	$ (10,848,601)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	8,853	6,521
Stock-based compensation	531,134	249,645
Amortization of right of use lease asset	109,546
Foreign currency gain	(2,591,008)	(741,616)
Changes in operating assets and liabilities:
Deferred offering costs	(4,244,276)
Prepaid expense and other current assets	(46,981)	84,080
Accounts payable	2,000,482	(216,116)
Accrued expenses and other liabilities	3,111,906	67,122
Lease liability	(102,996)
Net cash used in operating activities	(16,210,409)	(11,398,965)
Cash flows from investing activities:
Purchases of property and equipment	(16,435)	(4,506)
Net cash used in investing activities	(16,435)	(4,506)
Cash flows from financing activities:
Proceeds from the exercise of stock options	23,118	1,415
Proceeds from issuance of Series C preferred stock, net	5,598,362
Net cash provided by financing activities	5,621,480	1,415
Decrease in cash	(10,605,364)	(11,402,056)
Effect of exchange rate changes on cash and cash equivalents	(2,736,465)	(645,333)
Cash and cash equivalents-beginning of period	65,675,931	24,401,488
Cash and cash equivalents-end of period	52,334,102	$ 12,354,099
Non-cash activities:
Cumulative effect of change in accounting principle-ASC 842 adoption	$ 329,384

Nature of business and basis of

Nature of business and basis of presentation	9 Months Ended
	Sep. 30, 2019
Nature of business and basis of presentation
Nature of business and basis of presentation	1. Nature of business and basis of presentation Nature of business —Aprea Therapeutics, Inc. (or the “Company”) is a clinical‑stage biopharmaceutical company focused on developing and commercializing novel cancer therapeutics that reactivate mutant tumor suppressor protein p53. p53 is the protein expressed from the TP53 gene, the most commonly mutated gene in cancer. The Company began principal operations in 2006 and is headquartered in Boston, Massachusetts with research facilities in Stockholm, Sweden. Corporate reorganization - In September 2019, the Company completed a corporate reorganization whereby Aprea Therapeutics AB became a wholly-owned subsidiary of the Company. In connection with the corporate reorganization, each issued and outstanding share of Series A, Series B and Series C convertible preferred stock of Aprea Therapeutics AB was exchanged on a one for one basis into shares of Series A, Series B and Series C convertible preferred stock of the Company. Each share of common stock of Aprea Therapeutics AB ($0.11 par value) was also exchanged on a one for one basis into shares of common stock of the Company ($0.001 par value). Basis of presentation and management plans —The accompanying financial statements are prepared in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”). The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Since its inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff, and raising capital, and has financed its operations through the issuance of convertible preferred stock and common stock. The Company is subject to risks common to companies in the biopharmaceutical industry. There can be no assurance that the Company’s research and development will be successfully completed, that adequate protection for the Company’s intellectual property will be maintained, that any therapeutic products developed will obtain required regulatory approval or that any approved or consumer products will be commercially viable. Even if the Company’s development efforts are successful, it is uncertain when, if ever, the Company will generate significant product sales. The Company believes that the September 30, 2019 cash balance of $52,334,102, together with the net proceeds from its initial public offering (or "IPO") of common stock which was completed in October 2019 (see Note 9) will be sufficient to fund the Company’s operations into 2023. In the event that additional funds are not available thereafter, management would expect to significantly reduce expenditures to conserve cash, which would involve scaling back or curtailing new development activity.

Summary of significant accounti

Summary of significant accounting policies	9 Months Ended
	Sep. 30, 2019
Summary of significant accounting policies
Summary of significant accounting policies	2. Summary of significant accounting policies The Company's complete listing of significant accounting policies are described in Note 2 to the Company's audited consolidated financial statements as of December 31, 2018 included in the prospectus that forms a part of the Company's Registration Statement on Form S-1 (File No. 333-233662) dated October 2, 2019. Principles of consolidation —The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Aprea Therapeutics AB, Aprea Personal AB, which was incorporated in May 2009, and Aprea US, Inc., which was incorporated in June 2016. Management has concluded it has a single reporting segment for purposes of reporting financial condition and results of operations. All intercompany transactions and balances have been eliminated. Unaudited interim consolidated financial statements —The accompanying unaudited interim condensed consolidated financial statements have been prepared by the Company in accordance with U.S. GAAP for interim information and pursuant to the rules and regulations of the Securities and Exchange commission (or the “SEC”) for reporting on Form 10-Q. Accordingly, certain information and footnote disclosure normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. These unaudited condensed interim financial statements should be read in conjunction with the audited financial statements and related notes that appear in the Company’s final prospectus filed with the SEC on October 2, 2019, relating to the Company’s Registration Statements on Form S-1 (File No. 333-233662) for the Company’s IPO. The unaudited interim consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, and in management’s opinion, include all adjustments, consisting of only normal recurring adjustments, necessary for the fair presentation of the financial information for the interim periods have been made. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results to be expected for the full fiscal year or any future period. Use of estimates —The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses as of and during the reporting period. The Company bases estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. The Company assesses estimates on an ongoing basis; however, actual results could materially differ from those estimates. Significant items subject to such estimates and assumptions include fair value of common stock and stock-based compensation expense. Foreign currency and currency translation —The functional currency for Aprea Therapeutics AB and Aprea Personal AB, is the Swedish Krona. Assets and liabilities of Aprea Therapeutics AB and Aprea Personal AB are translated into United States dollars at the exchange rate in effect on the balance sheet date. Revenues and expenses are translated at the average exchange rate in effect during the period. Unrealized translation gains and losses are recorded as a cumulative translation adjustment, which is included in the consolidated statements of convertible preferred stock and stockholders’ deficit as a component of accumulated other comprehensive loss. Adjustments that arise from exchange rate changes on transactions denominated in a currency other than the local currency are included in other income and expense in the condensed consolidated statements of operations and comprehensive loss as incurred. Deferred offering costs —The Company capitalizes deferred IPO costs, which primarily consist of direct, incremental legal, professional, accounting and other third-party fees relating to the Company’s IPO. The deferred IPO costs will be offset against IPO proceeds upon the completion of an offering (see Note 9). There were $0 and $4,070,690 of deferred IPO costs as of December 31, 2018 and September 30, 2019, respectively. Fair value of financial instruments —The accounting standard for fair value measurements provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. Fair value is defined as the price that would be received upon sale of an asset or paid to transfer a liability between market participants at measurement dates. ASC Topic 820, Fair Value Measurement (“ASC 820”), establishes a three‑level valuation hierarchy for instruments measured at fair value. The hierarchy is based on the transparency of inputs to the valuation of an asset or liability as of the measurement date. The hierarchy defines three levels of valuation inputs, of which the first two are considered observable and the last is considered unobservable: · Level 1 inputs: Quoted prices in active markets for identical assets or liabilities. · Level 2 inputs: Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable, such as quoted market prices, interest rates and yield curves. · Level 3 inputs: Unobservable inputs developed using estimates or assumptions developed by the Company, which reflect those that a market participant would use in pricing the asset or liability. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The Company’s financial instruments consist of accounts payable. The carrying amount of accounts payable is considered a reasonable estimate of fair value due to the short‑term maturity. Convertible preferred stock —The Company has classified convertible preferred stock as temporary equity in the accompanying balance sheets due to certain change in control events that are outside of the Company’s control, including sale or transfer of control of the Company, as holders of the Preferred Stock could cause redemption of the shares in these situations. The Company does not accrete the carrying values of the Preferred Stock to the redemption values since a liquidation event was not considered probable as of September 30, 2019. Subsequent adjustments of the carrying values to the ultimate redemption values will be made only if it becomes probable that such a liquidation event will occur. Accounting for leases —In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016 02, “Leases” (“ASC 842”) to enhance the transparency and comparability of financial reporting related to leasing arrangements. Under this new lease standard, most leases are required to be recognized on the balance sheet as right‑of‑use assets and lease liabilities. Disclosure requirements have been enhanced with the objective of enabling financial statement users to assess the amount, timing, and uncertainty of cash flows arising from leases. Prior to January 1, 2019, GAAP did not require lessees to recognize assets and liabilities related to operating leases on the balance sheet. The new standard establishes a right‑of‑use (“ROU”) model that requires a lessee to recognize a ROU asset and corresponding lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement as well as the reduction of the right of use asset. The Company has adopted the standard effective January 1, 2019, using the modified retrospective method. The new standard provides a number of optional practical expedients in transition. The Company has elected to apply the ‘package of practical expedients’ which allow us to not reassess (i) whether existing or expired arrangements contain a lease, (ii) the lease classification of existing or expired leases, or (iii) whether previous initial direct costs would qualify for capitalization under the new lease standard. The Company has also elected to apply (i) the practical expedient which allows us to not separate lease and non‑lease components, for new leases entered into after adoption and (ii) the short‑term lease exemption for all leases with an original term of less than 12 months, for purposes of applying the recognition and measurements requirements in the new standard. For the impact to the Company’s consolidated financial statement upon adoption of the new leasing standard, see Note 3 to our unaudited condensed consolidated financial statements. At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on specific facts and circumstances, the existence of an identified asset(s), if any, and the Company’s control over the use of the identified asset(s), if applicable. Operating lease liabilities and their corresponding right‑of‑use assets are recorded based on the present value of future lease payments over the expected lease term. The interest rate implicit in lease contracts is typically not readily determinable. As such, the Company will utilize the incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. As of the ASC 842 effective date, the Company’s incremental borrowing rate ranged from approximately 3.0% to 4.3% based on the remaining lease term of the applicable leases. The Company has elected not to separate lease and non‑lease components as a single component. Operating leases are recognized on the balance sheet as ROU lease assets, lease liabilities current and lease liabilities non‑current. Fixed rents are included in the calculation of the lease balances while variable costs paid for certain operating and pass‑through costs are excluded. Lease expense is recognized over the expected term on a straight‑line basis. Stock‑based compensation —The Company measures stock options and other stock-based awards granted to employees and directors based on their fair value on the date of the grant and recognize compensation expense of those awards, net of estimated forfeitures, over the requisite service period, which is generally the vesting period of the respective award. The Company applies the straight‑line method of expense recognition to all awards with only service based vesting conditions. For stock-based awards granted to non‑employees, compensation expense is recognized over the period during which services are rendered by such non‑employees until completed in accordance with the FASB issued ASU No. 2018‑07, Compensation Stock Compensation (Topic 718): Improvements to Nonemployee Share Based Payment Accounting. The new standard largely aligns the accounting for share based payment awards issued to employees and nonemployees by expanding the scope of ASC 718 to apply to nonemployee share based transactions, as long as the transaction is not effectively a form of financing. The Company estimates the fair value of each stock option grant on the date of grant using the Black Scholes option pricing model, which uses as inputs the fair value of the Company’s common stock and assumptions the Company makes for the volatility of its common stock, the expected term of its stock options, the risk free interest rate for a period that approximates the expected term of its stock options and its expected dividend yield. Determination of Fair Value of Common Stock As there has been no public market for the Company’s common stock to date, the estimated fair value of its common stock has been determined by its board of directors as of the date of each option grant, with input from management, considering the Company’s most recently available third party valuations of common stock and its board of directors’ assessment of additional objective and subjective factors that it believed were relevant and which may have changed from the date of the most recent valuation through the date of the grant. These third-party valuations were performed in accordance with the guidance outlined in the American Institute of Certified Public Accountants’ Accounting and Valuation Guide, Valuation of Privately Held Company Equity Securities Issued as Compensation. The Company’s common stock valuations were prepared using a hybrid method, which used market approaches to estimate its enterprise value. The hybrid method is a probability weighed expected return method, or PWERM, where the equity value in one or more scenarios is calculated using an option pricing method, or OPM. The OPM treats common stock and preferred stock as call options on the total equity value of a company, with exercise prices based on the value thresholds at which the allocation among the various holders of a company’s securities changes. Under this method, the common stock has value only if the funds available for distribution to stockholders exceeded the value of the preferred stock liquidation preference at the time of the liquidity event, such as a strategic sale or a merger. The PWERM is a scenario-based methodology that estimates the fair value of common stock based upon an analysis of future values for the company, assuming various outcomes. The common stock value is based on the probability weighted present value of expected future investment returns considering each of the possible outcomes available as well as the rights of each class of stock. The future value of the common stock under each outcome is discounted back to the valuation date at an appropriate risk adjusted discount rate and probability weighted to arrive at an indication of value for the common stock. These third party valuations were performed at various dates, which resulted in valuations of the Company’s common stock of $0.92 per share as of May 31, 2016, $1.01 per share as of October 2, 2017, $3.18 per share as of December 31, 2018 and $10.95 per share as of July 15, 2019. In addition to considering the results of these third‑party valuations, the Company’s board of directors considered various objective and subjective factors to determine the fair value of its common stock as of each grant date, including: · the prices at which the Company sold shares of preferred stock and the superior rights and preferences of the preferred stock relative to its common stock at the time of each grant; · the progress of the Company’s research and development programs, including the status and results of preclinical studies and clinical trials for its product candidates; · the Company’s stage of development and commercialization and its business strategy; · external market conditions affecting the biopharmaceutical industry and trends within the biopharmaceutical industry; · the Company’s financial position, including cash on hand, and its historical and forecasted performance and operating results; · the lack of an active public market for the Company’s common stock and its preferred stock; · the likelihood of achieving a liquidity event, such as an IPO, or sale of the Company in light of prevailing market conditions; and · the analysis of IPOs and the market performance of similar companies in the biopharmaceutical industry. The assumptions underlying these valuations represented management’s best estimate, which involved inherent uncertainties and the application of management’s judgment. As a result, if the Company had used significantly different assumptions or estimates, the fair value of its common stock and its stock‑based compensation expense could have been materially different. Net loss per share —The Company has reported losses since inception and has computed basic net loss per share attributable to common stockholders by dividing net loss attributable to common stockholders by the weighted‑average number of common shares outstanding for the period, without consideration for potentially dilutive securities. The Company computes diluted net loss per common share after giving consideration to all potentially dilutive common shares, including options to purchase common stock and convertible preferred stock, outstanding during the period determined using the treasury‑stock and if‑converted methods, except where the effect of including such securities would be antidilutive. Because the Company has reported net losses since inception, these potential common shares have been anti‑dilutive and basic and diluted loss per share have been the same. The following table sets forth the potentially dilutive securities that have been excluded from the calculation of diluted net loss per share because to include them would be anti‑dilutive (in common stock equivalent shares): Nine Months Ended September 30, 2019 2018 Series A convertible preferred stock 612,446 612,446 Series B convertible preferred stock 7,235,969 7,235,969 Series C convertible preferred stock 5,179,877 — Options to purchase common stock 2,970,234 1,844,990 Total shares of common stock equivalents 15,998,526 9,693,405 Recently issued accounting pronouncements—not yet adopted In June 2018, the FASB issued ASU No. 2018‑07, “ Compensation—Stock Compensation”, which expands the scope of Topic 718 to include share‑based payment transactions for acquiring goods and services from nonemployees, except for specific exceptions. This ASU is effective for annual or any interim periods beginning after December 15, 2019. The Company is currently assessing the impact of adopting this authoritative guidance on its financial statements.

Leases

Leases	9 Months Ended
	Sep. 30, 2019
Leases
Leases	3. Leases On January 1, 2019, the Company adopted ASC 842 using the modified retrospective transition approach allowed under ASU 2018‑11 which releases companies from presenting comparative periods and related disclosures under ASC 842 and requires a cumulative‑effect adjustment to the opening balance of retained earnings in the period of adoption (Note 2). The Company is party to two operating leases for office or laboratory space. The Company’s finance leases are immaterial both individually and in the aggregate. The Company has elected to apply the short‑term lease exception to all leases of one year or less. Rent expense for three and nine months ended September 30, 2019 was $38,734 and $166,518, respectively, which are included in operating expenses. Further, the Company has applied the guidance in ASC 842 to its corporate office and laboratory leases and has determined that these should be classified as operating leases. Consequently, as a result of the adoption of ASC 842, the Company recognized a ROU lease asset of approximately $329,384 with a corresponding lease liability of approximately $348,040 based on the present value of the minimum rental payments of such leases. In accordance with ASC 842, the beginning balance of the ROU lease asset was reduced by the existing deferred rent liability at inception of approximately $18,656. In the consolidated balance sheets at September 30, 2019, the Company has a ROU asset balance of $251,168 and a current and non‑current lease liability of $114,102 and $152,779, respectively, relating to the ROU lease asset. The balance of both the ROU lease asset and the lease liabilities primarily consists of future payments under the Company’s office lease in Boston, Massachusetts. The Company is party to an operating lease in Boston, Massachusetts for office and laboratory space. The lease commenced in November 2016 with the initial term set to expire in December 2021. This office lease does not have any renewal options. The Company was party to an operating lease in Solna, Sweden that had month‑to‑month payments and expired on June 30, 2019. Additionally, the Company entered into a new operating lease for office and laboratory space in Solna, Sweden that is effective July 1, 2019 and expires in June 2022. Base rent for this lease is approximately $128,000 annually. The Company recognized a ROU lease asset of approximately $355,330 with a corresponding lease liability of the same amount based on the present value of the minimum rental payments of such leases. As of September 30, 2019, the Company has a ROU asset balance of $309,150 and a current and non-current lease liability of $112,749 and $205,625, respectively, relating to the ROU lease asset relating to its lease in Solna, Sweden. Quantitative information regarding the Company’s leases for the three and nine months ended September 30, 2019 is as follows: Three Months Nine Months Ended Ended Lease Cost September 30, 2019 September 30, 2019 Operating lease cost $ 54,358 $ 106,210 Other Information Operating cash flows paid for amounts included in the measurement of lease liabilities $ 51,394 $ 112,211 Operating lease liabilities arising from obtaining right‑of‑use assets $ 585,256 $ 585,256 Weighted average remaining lease term (years) 2.3 - 2.8 2.3 - 2.8 Weighted average discount rate 3.0% - 4.3% 3.0% - 4.3% Future lease payments under noncancelable leases are as follows at September 30, 2019: Operating Future Lease Payments Leases Remainder of 2019 $ 60,598 2020 244,688 2021 246,983 2022 60,380 Total Lease Payments $ 612,649 Less: Imputed Interest (27,393) Total Lease Liabilities $ 585,256 As most of the Company’s leases do not provide an implicit rate, the Company used its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company uses the incremental borrowing rate on January 1, 2019 for operating leases that commenced prior to that date.

Accrued expenses

Accrued expenses	9 Months Ended
	Sep. 30, 2019
Accrued expenses
Accrued expenses	4. Accrued expenses Accrued expenses consist of the following: September 30, December 31, 2019 2018 Professional fees $ 2,982,289 $ 80,771 Compensation and benefits 575,262 624,298 Research and development 2,153,881 2,178,086 Other 135,932 245,617 Total accrued expenses $ 5,847,364 $ 3,128,772

Convertible preferred stock

Convertible preferred stock	9 Months Ended
	Sep. 30, 2019
Convertible preferred stock
Convertible preferred stock	5. Convertible preferred stock The Company has 440,000,000 shares authorized for all classes of equity combined. Series A Preferred In June 2011, the Company issued 145,472 shares of Series A Preferred for gross proceeds of $3,233,417. In March 2016, the Company issued 466,974 shares of Series A Preferred as settlement of its outstanding bridge loans totaling $3,249,627. All 612,446 shares of Series A Preferred were issued to related parties. As of September 30, 2019, the rights and preferences of the Series A Preferred are as follows: Conversion —Each share of Series A Preferred may be converted at any time, at the option of the holder, into a share of common stock. The Series A Preferred automatically converts into shares of common stock when 1) shareholders representing a majority of the outstanding preferred shares calls for such conversion or 2) at the closing of an initial public offering of the Company’s common stock at a per share price of at least one and a half (1.5) times the average amount (EUR 16.05 based on all Series C preferred shares issued as of September 30, 2019) paid per Series C preferred share (as adjusted for share splits and similar) and aggregate proceeds in excess of EUR 50,000,000. Dividends —Holders of Series A Preferred do not accrue dividends. Voting rights —Preferred Stock and common stock vote together as one class on an as converted basis. Common stock voting rights on certain matters are subject to the powers, preferences, and rights of the Preferred Stock. Holders are entitled to vote on all matters and shall have the number of votes equal to the number of shares of common stock into which the shares of Preferred Stock held by such holder are then convertible. Series B Preferred In March 2016, the Company issued 3,322,764 shares of Series B Preferred for gross proceeds of $22,609,485. The Company also issued 590,446 shares of Series B Preferred in settlement of its outstanding bridge loans totaling $4,108,818. In October 2017, the Company issued 3,322,759 Series B preferred shares at a price per share of $7.02, for an aggregate purchase price of $23,349,617. All 7,235,969 shares of Series B Preferred were issued to related parties. As of September 30, 2019, the rights and preferences of the Series B Preferred are as follows: Conversion —Each share of Series B Preferred may be converted at any time, at the option of the holder, into a share of common stock. The Series B Preferred automatically converts into shares of common stock when 1) shareholders representing a majority of the outstanding preferred shares calls for such conversion or 2) at the closing of an initial public offering of the Company’s common stock at a per share price of at least one and a half (1.5) times the average amount (EUR 16.05 based on all Series C preferred shares issued as of September 30, 2019) paid per Series C preferred share (as adjusted for share splits and similar) and aggregate proceeds in excess of EUR 50,000,000. Dividends —Holders are entitled to dividends of 8%, compounded annually if not paid. No dividends have been declared or paid as of September 30, 2019. The company has not accrued dividends on the Series B Preferred since dividends are only payable upon the occurrence of a liquidation event, including the transfer of more than fifty percent of the Company’s outstanding shares or the transfer of substantially all of the Company’s intellectual property. Approximately $12,220,935 of accrued dividends that were payable through September 30, 2019 was added to the stated liquidation preference amount of the Series B Preferred, which totaled $62,288,856 at September 30, 2019. Voting rights —Preferred Stock and common stock vote together as one class on an as converted basis. Common stock voting rights on certain matters are subject to the powers, preferences, and rights of the Preferred Stock. Holders are entitled to vote on all matters and shall have the number of votes equal to the number of shares of common stock into which the shares of Preferred Stock held by such holder are then convertible. Series C Preferred In November 2018, the Company issued 4,712,70 4 shares of Series C Preferred for gross proceeds of $56,725,342. In February 2019, the Company issued 467,17 3 shares of Series C Preferred for gross proceeds of $5,651,872. A total of 4,219,854 shares of Series C Preferred were issued to related parties. As of September 30, 2019, the rights and preferences of the Series C Preferred are as follows: Conversion —Each share of Series C Preferred may be converted at any time, at the option of the holder, into a share of common stock. The Series C Preferred automatically converts into shares of common stock when 1) shareholders representing a majority of the outstanding preferred shares calls for such conversion or 2) at the closing of an initial public offering of the Company’s common stock at a per share price of at least one and a half (1.5) times the average amount (EUR 16.05 based on all Series C preferred shares issued as of September 30, 2019) paid per Series C preferred share (as adjusted for share splits and similar) and aggregate proceeds in excess of EUR 50,000,000. Dividends —Holders are entitled to dividends of 8%, compounded annually if not paid. No dividends have been declared or paid as of September 30, 2019. The company has not accrued dividends on the Series C Preferred since dividends are only payable upon the occurrence of a liquidation event, including the transfer of more than fifty percent of the Company’s outstanding shares or the transfer of substantially all of the Company’s intellectual property. Approximately $4,074,601 of accrued dividends that were payable through September 30, 2019 was added to the stated liquidation preference amount of the Series C Preferred, which totaled $66,451,815 at September 30, 2019. Voting rights —Preferred Stock and common stock vote together as one class on an as converted basis. Common stock voting rights on certain matters are subject to the powers, preferences, and rights of the Preferred Stock. Holders are entitled to vote on all matters and shall have the number of votes equal to the number of shares of common stock into which the shares of Preferred Stock held by such holder are then convertible. Liquidation preference Upon liquidation, dissolution, or winding up of business, the Preferred Stock holders are entitled to receive a liquidation preference in priority to holders of common stock at the original issue price plus, in the case of Series B and Series C Preferred, any unpaid accumulated dividends as follows: 1) If a liquidation event occurs prior to the Company achieving a certain clinical milestone, Series C Preferred shareholders shall receive an amount per Series C Preferred share equal to the original subscription price per Series C Preferred share (as adjusted for share splits and similar) plus unpaid accumulated dividends. Secondly, after the Series C Preferred shareholders have received full payment, the Series B Preferred shareholders shall receive an amount per Series B preferred share equal to the original subscription price per Series B Preferred share (as adjusted for share splits and similar) plus unpaid accumulated dividends. Thirdly, after the Series B and C Preferred shareholders have received full payment, the Series A Preferred shareholders shall receive an amount per Series A preferred share equal to the original subscription price per Series A Preferred share (as adjusted for share splits and similar). When the Preferred A, B and C shareholders are satisfied in full, any excess assets available for distribution will be allocated ratably among holders of common stock and preferred stock based on their pro rata shareholdings on an as‑if‑converted basis. 2) If a liquidation event occurs after the Company achieves a certain clinical milestone, Series B and C Preferred shareholders, based on their pro rata shareholdings, shall receive an amount per Series B and C Preferred share equal to the original subscription price per Series B and C Preferred share (as adjusted for share splits and similar) plus unpaid accumulated dividends. Secondly, after the Series B and C Preferred shareholders have received full payment, the Series A Preferred shareholders shall receive an amount per Series A preferred share equal to the original subscription price per Series A Preferred share (as adjusted for share splits and similar). When the Preferred A, B and C shareholders are satisfied in full, any excess assets available for distribution will be allocated ratably among holders of common stock and preferred stock based on their pro rata shareholdings on an as‑if‑converted basis. The liquidation preferences apply to each series of preferred stock only to the extent the holders would receive less than three times their respective original purchase prices.

Stockholders' equity (deficit)

Stockholders' equity (deficit)	9 Months Ended
	Sep. 30, 2019
Stockholders' equity (deficit)
Stockholders' equity (deficit)	6. Stockholders’ equity (deficit) Common Stock The holders of common stock are entitled to one vote for each share of common stock. Subject to the payment in full of all preferential dividends to which the holders of the Preferred Stock are entitled, the holders of common stock shall be entitled to receive dividends out of funds legally available. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, after the payment or provision for payment of all debts and liabilities of the Company and all preferential amounts to which the holders of Preferred Stock are entitled with respect to the distribution of assets in liquidation, the holders of common stock shall be entitled to share ratably in the remaining assets of the Company available for distribution. Stock-Based Compensation Expense The Company recorded stock-based compensation expense of $246,225 and $79,791 for the three months ended September 30, 2019 and 2018, respectively. The Company recorded stock-based compensation expense of $531,134 and $249,645 for the nine months ended September 30, 2019 and 2018, respectively.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2019
Income Taxes
Income Taxes	7. Income Taxes The Company has no income tax expense due to operating losses incurred for the three and nine months ended September 30, 2019 and 2018. The Company has provided a valuation allowance for the full amount of the net deferred tax assets as, based on all available evidence, it is considered more likely than not that all the recorded deferred tax assets will not be realized in a future period. At December 31, 2018, the Company had $61.6 million, $0.5 million and $0.4 million of foreign, federal and state net operating loss carryforwards, respectively, that expire at various dates through 2036. Certain of these foreign, federal and state net operating loss carryforwards may be subject to Internal Revenue Code Section 382 or similar provisions or the equivalent Swedish regulations, which impose limitations on their utilization amounts. Realization of the future tax benefits is dependent on may factors, including the Company’s ability to generate taxable income within the net operating loss carryforward period. Under the provisions of the U.S. Internal Revenue Code and Sweden tax law, certain substantial changes in the Company’s ownership, including a sale of the Company or significant changes in ownership due to a sales of equity, may have limited, or may limit in the future, the amount of net operating loss carryforwards that could be used annually to offset future taxable income. For U.S. and Swedish income tax purposes, the Company has not completed a study to assess whether a change of control has occurred or whether there have been changes of control since the Company’s formation due to the complexity and cost associated with such study and because there could be additional changes of control in the future. As a result, the Company is not able to estimate the effect of the change in control, if any, on the Company’s ability to utilize U.S. or Swedish net operating losses or other tax attribute carryforwards in the future. For Swedish income tax purposes, the Company has estimated that approximately $12.5 million of its net operating losses may be subject to limitations in accordance with the country’s group contribution restriction laws at December 31, 2018. The Company files tax returns in Sweden, the United States, Pennsylvania and Massachusetts, and all tax years since inception remain open to examination by the major taxing jurisdictions to which the Company is subject, as carryforward attributes generated in years past may still be adjusted upon examination by the Internal Revenue Service (IRS) or other authorities if they have or will be used in a future period. The Company is not currently under examination by the IRS or any other jurisdictions for any tax years. As of September 30, 2019 and December 31, 2018, the Company had no uncertain tax positions or related interest and penalties accrued. In June 2018, Sweden pass law on changes to the Swedish regulations on corporate income taxation. The law applies from January 1, 2019. Among other things, the changes decrease the corporate income tax rate in two steps from 22% to 21.4% as of January 1, 2019 and 20.6% as of January 1, 2021. U.S. GAAP requires companies to revalue their deferred tax assets and deferred tax liabilities as of the date of enactment, with the resulting tax effects accounted for in the reporting period on enactment. This revaluation resulted in an overall reduction of deferred tax assets of $0.7 million and a corresponding reduction in the valuation allowance. As such, there was no net impact to the Company’s statement of operations as a result of the reduction in tax rates.

Commitments and contingencies

Commitments and contingencies	9 Months Ended
	Sep. 30, 2019
Commitments and contingencies
Commitments and contingencies	8. Commitments and contingencies The Company records a provision for contingent losses when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. As of September 30, 2019, the Company has not recorded a provision for any contingent losses

Subsequent events

Subsequent events	9 Months Ended
	Sep. 30, 2019
Subsequent events
Subsequent events	9. Subsequent events In October 2019, the Company completed its initial public offering of 6,516,667 shares of common stock at a price to the public of $15.00 per share, which included the exercise in full by the underwriters of their option to purchase an additional 850,000 shares of common stock. The Company received gross proceeds, before deducting underwriting discounts and commissions and other offering expenses, of approximately $97.75 million. Immediately prior to consummation of the IPO, all outstanding shares of Series A, Series B and Series C convertible preferred stock of the Company were converted into common stock at a ratio of 1:1. Upon the closing of the IPO, a total of 20,726,532 shares of common stock were outstanding, which includes approximately 3,365,000 shares that were purchased by related parties. The Company’s common stock began trading on The Nasdaq Global Select Market on October 3, 2019 under the symbol “APRE”.

Summary of significant accoun_2

Summary of significant accounting policies (Policies)	9 Months Ended
	Sep. 30, 2019
Summary of significant accounting policies
Principles of consolidation	Principles of consolidation —The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Aprea Therapeutics AB, Aprea Personal AB, which was incorporated in May 2009, and Aprea US, Inc., which was incorporated in June 2016. Management has concluded it has a single reporting segment for purposes of reporting financial condition and results of operations. All intercompany transactions and balances have been eliminated.
Unaudited interim condensed consolidated financial statements	Unaudited interim consolidated financial statements —The accompanying unaudited interim condensed consolidated financial statements have been prepared by the Company in accordance with U.S. GAAP for interim information and pursuant to the rules and regulations of the Securities and Exchange commission (or the “SEC”) for reporting on Form 10-Q. Accordingly, certain information and footnote disclosure normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. These unaudited condensed interim financial statements should be read in conjunction with the audited financial statements and related notes that appear in the Company’s final prospectus filed with the SEC on October 2, 2019, relating to the Company’s Registration Statements on Form S-1 (File No. 333-233662) for the Company’s IPO. The unaudited interim consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, and in management’s opinion, include all adjustments, consisting of only normal recurring adjustments, necessary for the fair presentation of the financial information for the interim periods have been made. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results to be expected for the full fiscal year or any future period.
Use of estimates	Use of estimates —The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses as of and during the reporting period. The Company bases estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. The Company assesses estimates on an ongoing basis; however, actual results could materially differ from those estimates. Significant items subject to such estimates and assumptions include fair value of common stock and stock-based compensation expense.
Foreign currency and currency translation	Foreign currency and currency translation —The functional currency for Aprea Therapeutics AB and Aprea Personal AB, is the Swedish Krona. Assets and liabilities of Aprea Therapeutics AB and Aprea Personal AB are translated into United States dollars at the exchange rate in effect on the balance sheet date. Revenues and expenses are translated at the average exchange rate in effect during the period. Unrealized translation gains and losses are recorded as a cumulative translation adjustment, which is included in the consolidated statements of convertible preferred stock and stockholders’ deficit as a component of accumulated other comprehensive loss. Adjustments that arise from exchange rate changes on transactions denominated in a currency other than the local currency are included in other income and expense in the condensed consolidated statements of operations and comprehensive loss as incurred.
Deferred offering costs	Deferred offering costs —The Company capitalizes deferred IPO costs, which primarily consist of direct, incremental legal, professional, accounting and other third-party fees relating to the Company’s IPO. The deferred IPO costs will be offset against IPO proceeds upon the completion of an offering (see Note 9). There were $0 and $4,070,690 of deferred IPO costs as of December 31, 2018 and September 30, 2019, respectively.
Fair value of financial instruments	Fair value of financial instruments —The accounting standard for fair value measurements provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. Fair value is defined as the price that would be received upon sale of an asset or paid to transfer a liability between market participants at measurement dates. ASC Topic 820, Fair Value Measurement (“ASC 820”), establishes a three‑level valuation hierarchy for instruments measured at fair value. The hierarchy is based on the transparency of inputs to the valuation of an asset or liability as of the measurement date. The hierarchy defines three levels of valuation inputs, of which the first two are considered observable and the last is considered unobservable: · Level 1 inputs: Quoted prices in active markets for identical assets or liabilities. · Level 2 inputs: Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable, such as quoted market prices, interest rates and yield curves. · Level 3 inputs: Unobservable inputs developed using estimates or assumptions developed by the Company, which reflect those that a market participant would use in pricing the asset or liability. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The Company’s financial instruments consist of accounts payable. The carrying amount of accounts payable is considered a reasonable estimate of fair value due to the short‑term maturity.
Convertible preferred stock	Convertible preferred stock —The Company has classified convertible preferred stock as temporary equity in the accompanying balance sheets due to certain change in control events that are outside of the Company’s control, including sale or transfer of control of the Company, as holders of the Preferred Stock could cause redemption of the shares in these situations. The Company does not accrete the carrying values of the Preferred Stock to the redemption values since a liquidation event was not considered probable as of September 30, 2019. Subsequent adjustments of the carrying values to the ultimate redemption values will be made only if it becomes probable that such a liquidation event will occur.
Accounting for leases	Accounting for leases —In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016 02, “Leases” (“ASC 842”) to enhance the transparency and comparability of financial reporting related to leasing arrangements. Under this new lease standard, most leases are required to be recognized on the balance sheet as right‑of‑use assets and lease liabilities. Disclosure requirements have been enhanced with the objective of enabling financial statement users to assess the amount, timing, and uncertainty of cash flows arising from leases. Prior to January 1, 2019, GAAP did not require lessees to recognize assets and liabilities related to operating leases on the balance sheet. The new standard establishes a right‑of‑use (“ROU”) model that requires a lessee to recognize a ROU asset and corresponding lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement as well as the reduction of the right of use asset. The Company has adopted the standard effective January 1, 2019, using the modified retrospective method. The new standard provides a number of optional practical expedients in transition. The Company has elected to apply the ‘package of practical expedients’ which allow us to not reassess (i) whether existing or expired arrangements contain a lease, (ii) the lease classification of existing or expired leases, or (iii) whether previous initial direct costs would qualify for capitalization under the new lease standard. The Company has also elected to apply (i) the practical expedient which allows us to not separate lease and non‑lease components, for new leases entered into after adoption and (ii) the short‑term lease exemption for all leases with an original term of less than 12 months, for purposes of applying the recognition and measurements requirements in the new standard. For the impact to the Company’s consolidated financial statement upon adoption of the new leasing standard, see Note 3 to our unaudited condensed consolidated financial statements. At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on specific facts and circumstances, the existence of an identified asset(s), if any, and the Company’s control over the use of the identified asset(s), if applicable. Operating lease liabilities and their corresponding right‑of‑use assets are recorded based on the present value of future lease payments over the expected lease term. The interest rate implicit in lease contracts is typically not readily determinable. As such, the Company will utilize the incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. As of the ASC 842 effective date, the Company’s incremental borrowing rate ranged from approximately 3.0% to 4.3% based on the remaining lease term of the applicable leases. The Company has elected not to separate lease and non‑lease components as a single component. Operating leases are recognized on the balance sheet as ROU lease assets, lease liabilities current and lease liabilities non‑current. Fixed rents are included in the calculation of the lease balances while variable costs paid for certain operating and pass‑through costs are excluded. Lease expense is recognized over the expected term on a straight‑line basis.
Stock based compensation	Stock‑based compensation —The Company measures stock options and other stock-based awards granted to employees and directors based on their fair value on the date of the grant and recognize compensation expense of those awards, net of estimated forfeitures, over the requisite service period, which is generally the vesting period of the respective award. The Company applies the straight‑line method of expense recognition to all awards with only service based vesting conditions. For stock-based awards granted to non‑employees, compensation expense is recognized over the period during which services are rendered by such non‑employees until completed in accordance with the FASB issued ASU No. 2018‑07, Compensation Stock Compensation (Topic 718): Improvements to Nonemployee Share Based Payment Accounting. The new standard largely aligns the accounting for share based payment awards issued to employees and nonemployees by expanding the scope of ASC 718 to apply to nonemployee share based transactions, as long as the transaction is not effectively a form of financing. The Company estimates the fair value of each stock option grant on the date of grant using the Black Scholes option pricing model, which uses as inputs the fair value of the Company’s common stock and assumptions the Company makes for the volatility of its common stock, the expected term of its stock options, the risk free interest rate for a period that approximates the expected term of its stock options and its expected dividend yield. Determination of Fair Value of Common Stock As there has been no public market for the Company’s common stock to date, the estimated fair value of its common stock has been determined by its board of directors as of the date of each option grant, with input from management, considering the Company’s most recently available third party valuations of common stock and its board of directors’ assessment of additional objective and subjective factors that it believed were relevant and which may have changed from the date of the most recent valuation through the date of the grant. These third-party valuations were performed in accordance with the guidance outlined in the American Institute of Certified Public Accountants’ Accounting and Valuation Guide, Valuation of Privately Held Company Equity Securities Issued as Compensation. The Company’s common stock valuations were prepared using a hybrid method, which used market approaches to estimate its enterprise value. The hybrid method is a probability weighed expected return method, or PWERM, where the equity value in one or more scenarios is calculated using an option pricing method, or OPM. The OPM treats common stock and preferred stock as call options on the total equity value of a company, with exercise prices based on the value thresholds at which the allocation among the various holders of a company’s securities changes. Under this method, the common stock has value only if the funds available for distribution to stockholders exceeded the value of the preferred stock liquidation preference at the time of the liquidity event, such as a strategic sale or a merger. The PWERM is a scenario-based methodology that estimates the fair value of common stock based upon an analysis of future values for the company, assuming various outcomes. The common stock value is based on the probability weighted present value of expected future investment returns considering each of the possible outcomes available as well as the rights of each class of stock. The future value of the common stock under each outcome is discounted back to the valuation date at an appropriate risk adjusted discount rate and probability weighted to arrive at an indication of value for the common stock. These third party valuations were performed at various dates, which resulted in valuations of the Company’s common stock of $0.92 per share as of May 31, 2016, $1.01 per share as of October 2, 2017, $3.18 per share as of December 31, 2018 and $10.95 per share as of July 15, 2019. In addition to considering the results of these third‑party valuations, the Company’s board of directors considered various objective and subjective factors to determine the fair value of its common stock as of each grant date, including: · the prices at which the Company sold shares of preferred stock and the superior rights and preferences of the preferred stock relative to its common stock at the time of each grant; · the progress of the Company’s research and development programs, including the status and results of preclinical studies and clinical trials for its product candidates; · the Company’s stage of development and commercialization and its business strategy; · external market conditions affecting the biopharmaceutical industry and trends within the biopharmaceutical industry; · the Company’s financial position, including cash on hand, and its historical and forecasted performance and operating results; · the lack of an active public market for the Company’s common stock and its preferred stock; · the likelihood of achieving a liquidity event, such as an IPO, or sale of the Company in light of prevailing market conditions; and · the analysis of IPOs and the market performance of similar companies in the biopharmaceutical industry. The assumptions underlying these valuations represented management’s best estimate, which involved inherent uncertainties and the application of management’s judgment. As a result, if the Company had used significantly different assumptions or estimates, the fair value of its common stock and its stock‑based compensation expense could have been materially different.
Net loss per share	Net loss per share —The Company has reported losses since inception and has computed basic net loss per share attributable to common stockholders by dividing net loss attributable to common stockholders by the weighted‑average number of common shares outstanding for the period, without consideration for potentially dilutive securities. The Company computes diluted net loss per common share after giving consideration to all potentially dilutive common shares, including options to purchase common stock and convertible preferred stock, outstanding during the period determined using the treasury‑stock and if‑converted methods, except where the effect of including such securities would be antidilutive. Because the Company has reported net losses since inception, these potential common shares have been anti‑dilutive and basic and diluted loss per share have been the same. The following table sets forth the potentially dilutive securities that have been excluded from the calculation of diluted net loss per share because to include them would be anti‑dilutive (in common stock equivalent shares): Nine Months Ended September 30, 2019 2018 Series A convertible preferred stock 612,446 612,446 Series B convertible preferred stock 7,235,969 7,235,969 Series C convertible preferred stock 5,179,877 — Options to purchase common stock 2,970,234 1,844,990 Total shares of common stock equivalents 15,998,526 9,693,405
Recently issued accounting pronouncements-not yet adopted	Recently issued accounting pronouncements—not yet adopted In June 2018, the FASB issued ASU No. 2018‑07, “ Compensation—Stock Compensation”, which expands the scope of Topic 718 to include share‑based payment transactions for acquiring goods and services from nonemployees, except for specific exceptions. This ASU is effective for annual or any interim periods beginning after December 15, 2019. The Company is currently assessing the impact of adopting this authoritative guidance on its financial statements.

Summary of significant accoun_3

Summary of significant accounting policies (Tables)	9 Months Ended
	Sep. 30, 2019
Summary of significant accounting policies
Schedule of potentially dilutive securities excluded from calculation of diluted net loss per share	The following table sets forth the potentially dilutive securities that have been excluded from the calculation of diluted net loss per share because to include them would be anti‑dilutive (in common stock equivalent shares): Nine Months Ended September 30, 2019 2018 Series A convertible preferred stock 612,446 612,446 Series B convertible preferred stock 7,235,969 7,235,969 Series C convertible preferred stock 5,179,877 — Options to purchase common stock 2,970,234 1,844,990 Total shares of common stock equivalents 15,998,526 9,693,405

Leases (Tables)

Leases (Tables)	9 Months Ended
	Sep. 30, 2019
Leases
Summary of quantitative information regarding the Company's leases	Three Months Nine Months Ended Ended Lease Cost September 30, 2019 September 30, 2019 Operating lease cost $ 54,358 $ 106,210 Other Information Operating cash flows paid for amounts included in the measurement of lease liabilities $ 51,394 $ 112,211 Operating lease liabilities arising from obtaining right‑of‑use assets $ 585,256 $ 585,256 Weighted average remaining lease term (years) 2.3 - 2.8 2.3 - 2.8 Weighted average discount rate 3.0% - 4.3% 3.0% - 4.3%
Schedule of future lease payments under noncancellable leases	Future lease payments under noncancelable leases are as follows at September 30, 2019: Operating Future Lease Payments Leases Remainder of 2019 $ 60,598 2020 244,688 2021 246,983 2022 60,380 Total Lease Payments $ 612,649 Less: Imputed Interest (27,393) Total Lease Liabilities $ 585,256

Accrued expenses (Tables)

Accrued expenses (Tables)	9 Months Ended
	Sep. 30, 2019
Accrued expenses
Schedule of accrued expenses	September 30, December 31, 2019 2018 Professional fees $ 2,982,289 $ 80,771 Compensation and benefits 575,262 624,298 Research and development 2,153,881 2,178,086 Other 135,932 245,617 Total accrued expenses $ 5,847,364 $ 3,128,772

Nature of business and basis _2

Nature of business and basis of presentation (Details)	9 Months Ended
	Sep. 30, 2019USD ($)$ / shares	Dec. 31, 2018$ / shares
Cash balance | $	$ 52,334,102
Conversion ratio	1
Common stock, par value	$ 0.001	$ 0.11
Aprea Therapeutics AB
Common stock, par value	$ 0.11

Summary of significant accoun_4

Summary of significant accounting policies - IPO (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Deferred offering costs
Deferred offering costs	$ 4,070,690
IPO
Deferred offering costs
Deferred offering costs	$ 4,070,690	$ 0

Summary of significant accoun_5

Summary of significant accounting policies - Accounting for leases (Details)	9 Months Ended
	Sep. 30, 2019
Property and equipment
Leases, election of practical expedients package	true
Minimum
Property and equipment
Incremental borrowing rate	3.00%
Maximum
Property and equipment
Incremental borrowing rate	4.30%

Summary of significant accoun_6

Summary of significant accounting policies - Stock-based compensation (Details) - $ / shares	Jul. 15, 2019	Dec. 31, 2018	Oct. 02, 2017	May 31, 2016
Summary of significant accounting policies
Fair value of unlisted common stock	$ 10.95	$ 3.18	$ 1.01	$ 0.92

Summary of significant accoun_7

Summary of significant accounting policies - Net loss per share (Details) - shares	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Potentially dilutive securities that have been excluded from the calculation of diluted net loss per share
Total shares of common stock equivalents	15,998,526	9,693,405
Series A convertible preferred stock
Potentially dilutive securities that have been excluded from the calculation of diluted net loss per share
Total shares of common stock equivalents	612,446	612,446
Series B convertible preferred stock
Potentially dilutive securities that have been excluded from the calculation of diluted net loss per share
Total shares of common stock equivalents	7,235,969	7,235,969
Series C convertible preferred stock
Potentially dilutive securities that have been excluded from the calculation of diluted net loss per share
Total shares of common stock equivalents	5,179,877
Options to purchase common stock
Potentially dilutive securities that have been excluded from the calculation of diluted net loss per share
Total shares of common stock equivalents	2,970,234	1,844,990

Leases - Summary (Details)

Leases - Summary (Details)	Jul. 01, 2019USD ($)	Sep. 30, 2019USD ($)lease	Sep. 30, 2019USD ($)lease	Jan. 01, 2019USD ($)
Leases
Number of operating leases | lease		2	2
Right of use lease asset		$ 560,318	$ 560,318
Lease liability		585,256	585,256
Lease liability-current		226,852	226,852
Lease liability-noncurrent		358,404	358,404
Massachusetts
Leases
Right of use lease asset		251,168	251,168
Lease liability-current		114,102	114,102
Lease liability-noncurrent		152,779	152,779
Sweden
Leases
Right of use lease asset		309,150	309,150
Lease liability-current		112,749	112,749
Lease liability-noncurrent		205,625	205,625
Annual base rent	$ 128,000
Adjustment | Sweden
Leases
Right of use lease asset		355,330	355,330
Lease liability		355,330	355,330
ASU 2018-11 - Leases (Topic 842) | Adjustment
Leases
Right of use lease asset		329,384	329,384
Lease liability		348,040	348,040
Deferred rent liability				$ 18,656
Operating Expenses
Leases
Rent expense - ASC 842		$ 38,734	$ 166,518

Leases - Quantitative Informati

Leases - Quantitative Information (Details)	3 Months Ended	9 Months Ended
	Sep. 30, 2019USD ($)	Sep. 30, 2019USD ($)
Quantitative information regarding the Company's leases
Operating lease cost	$ 54,358	$ 106,210
Other Information
Operating cash flows paid for amounts included in the measurement of lease liabilities	51,394	112,211
Operating lease liabilities arising from obtaining right-of-use assets	$ 585,256	$ 585,256
Minimum
Other Information
Weighted average remaining lease term (years)	2 years 3 months 18 days	2 years 3 months 18 days
Weighted average discount rate	3.00%	3.00%
Maximum
Other Information
Weighted average remaining lease term (years)	2 years 9 months 18 days	2 years 9 months 18 days
Weighted average discount rate	4.30%	4.30%

Leases - Future lease payments

Leases - Future lease payments (Details)	Sep. 30, 2019USD ($)
Future Lease Payments
Remainder of 2019	$ 60,598
2020	244,688
2021	246,983
2022	60,380
Total Lease Payments	612,649
Less: Imputed Interest	(27,393)
Total Lease Liabilities	$ 585,256

Accrued expenses (Details)

Accrued expenses (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Accrued expenses
Professional fees	$ 2,982,289	$ 80,771
Compensation and benefits	575,262	624,298
Research and development	2,153,881	2,178,086
Other	135,932	245,617
Total accrued expenses	$ 5,847,364	$ 3,128,772

Convertible preferred stock (De

Convertible preferred stock (Details)	1 Months Ended					6 Months Ended	9 Months Ended
	Feb. 28, 2019USD ($)shares	Nov. 30, 2018USD ($)shares	Oct. 31, 2017USD ($)$ / sharesshares	Mar. 31, 2016USD ($)shares	Jun. 30, 2011USD ($)shares	Jun. 30, 2019USD ($)shares	Sep. 30, 2019USD ($)	Sep. 30, 2019EUR (€)€ / sharesshares	Sep. 30, 2019USD ($)shares	Dec. 31, 2018shares
Convertible preferred stock
Aggregate number of authorized shares for all classes of equity | shares								440,000,000	440,000,000
Criteria for automatic conversion of Series A preferred shares
Convertible preferred stock
Threshold multiplier for determining automatic conversion								1.5	1.5
Average price paid per Series C convertible preferred share | € / shares								€ 16.05
Minimum aggregate proceeds | €								€ 50,000,000
Criteria for automatic conversion of Series B preferred shares
Convertible preferred stock
Threshold multiplier for determining automatic conversion								1.5	1.5
Average price paid per Series C convertible preferred share | € / shares								€ 16.05
Minimum aggregate proceeds | €								€ 50,000,000
Criteria for automatic conversion of Series C preferred shares
Convertible preferred stock
Threshold multiplier for determining automatic conversion								1.5	1.5
Average price paid per Series C convertible preferred share | € / shares								€ 16.05
Minimum aggregate proceeds | €								€ 50,000,000
Series A convertible preferred stock
Convertible preferred stock
Convertible preferred stock, issued | shares								612,446	612,446	612,446
Convertible preferred stock, liquidation preference | $									$ 6,483,044
Series A convertible preferred stock | Shares issued to related parties
Convertible preferred stock
Number of convertible preferred shares issued during the period | shares					145,472
Proceeds from issuance of convertible preferred shares | $					$ 3,233,417
Number of convertible preferred shares issued during the period as settlement of debt | shares				466,974
Value of convertible preferred shares issued as settlement of debt | $				$ 3,249,627
Convertible preferred stock, issued | shares								612,446	612,446
Series B convertible preferred stock
Convertible preferred stock
Convertible preferred stock, issued | shares								7,235,969	7,235,969	7,235,969
Dividends to which each holder is entitled (as a percent)							8.00%
Dividends declared (paid) during the period | $							$ 0
Accrued dividends added to liquidation preference amount | $									$ 12,220,935
Convertible preferred stock, liquidation preference | $									$ 62,288,856
Series B convertible preferred stock | Shares issued to related parties
Convertible preferred stock
Number of convertible preferred shares issued during the period | shares			3,322,759	3,322,764
Temporary equity, price per share | $ / shares			$ 7.02
Proceeds from issuance of convertible preferred shares | $			$ 23,349,617	$ 22,609,485
Number of convertible preferred shares issued during the period as settlement of debt | shares				590,446
Value of convertible preferred shares issued as settlement of debt | $				$ 4,108,818
Convertible preferred stock, issued | shares								7,235,969	7,235,969
Series C convertible preferred stock
Convertible preferred stock
Number of convertible preferred shares issued during the period | shares						467,179
Proceeds from issuance of convertible preferred shares | $						$ 5,598,362
Convertible preferred stock, issued | shares								5,179,877	5,179,877	4,712,698
Dividends to which each holder is entitled (as a percent)							8.00%
Dividends declared (paid) during the period | $							$ 0
Accrued dividends added to liquidation preference amount | $									$ 4,074,601
Convertible preferred stock, liquidation preference | $									$ 66,451,815
Series C convertible preferred stock | Shares issued to related parties
Convertible preferred stock
Number of convertible preferred shares issued during the period | shares	467,173	4,712,704
Proceeds from issuance of convertible preferred shares | $	$ 5,651,872	$ 56,725,342
Convertible preferred stock, issued | shares								4,219,854	4,219,854

Stockholders' equity (deficit)

Stockholders' equity (deficit) (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2019USD ($)	Sep. 30, 2018USD ($)	Sep. 30, 2019USD ($)Vote	Sep. 30, 2018USD ($)
Stockholders' equity (deficit)
Stock based compensation expense | $	$ 246,225	$ 79,791	$ 531,134	$ 249,645
Number of voting rights per common share | Vote			1

Income taxes (Details)

Income taxes (Details) - USD ($)	1 Months Ended	3 Months Ended	9 Months Ended
	Jun. 30, 2018	Sep. 30, 2019	Sep. 30, 2019	Dec. 31, 2018
Income taxes
Income tax expense		$ 0	$ 0
Operating loss carryforwards which may be subject to limitations				$ 12,500,000
Uncertain tax positions		$ 0	$ 0	0
Sweden
Income taxes
Foreign income tax rate (as a percent)	20.60%
Reduction in valuation allowance	$ (700,000)
Reduction in deferred income taxes	$ 0
Sweden | Minimum
Income taxes
Foreign income tax rate (as a percent)	21.40%
Sweden | Maximum
Income taxes
Foreign income tax rate (as a percent)	22.00%
Foreign
Income taxes
Operating loss carryforwards				61,600,000
Federal
Income taxes
Operating loss carryforwards				500,000
State
Income taxes
Operating loss carryforwards				$ 400,000

Commitments and contingencies (

Commitments and contingencies (Details)	9 Months Ended
	Sep. 30, 2019USD ($)
Commitments and contingencies
Provision for contingent losses	$ 0

Subsequent events (Details)

Subsequent events (Details) $ / shares in Units, $ in Thousands	1 Months Ended
	Oct. 31, 2019USD ($)$ / sharesshares	Sep. 30, 2019shares	Dec. 31, 2018shares
Subsequent events
Common stock, outstanding		1,181,733	1,155,366
Subsequent Event | IPO
Subsequent events
Gross proceeds from issuance | $	$ 97,750
Common stock, outstanding	20,726,532
Common stock, outstanding, shares held by related parties	3,365,000
Subsequent Event | Common Stock | IPO
Subsequent events
Shares issued	6,516,667
Offering price per share | $ / shares	$ 15
Common stock ratio	1
Subsequent Event | Common Stock | Over-Allotment Option
Subsequent events
Shares issued	850,000