Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | Apr. 27, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-39655 | |
Entity Registrant Name | GALECTO, INC. | |
Entity Central Index Key | 0001800315 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 37-1957007 | |
Entity Address, Address Line One | 75 State Street | |
Entity Address, Address Line Two | Suite 100 | |
Entity Address, City or Town | Boston | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 02109 | |
City Area Code | +45 | |
Local Phone Number | 70 70 52 10 | |
Title of 12(b) Security | Common Stock, par value $0.00001 per share | |
Trading Symbol | GLTO | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 25,261,832 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 45,388 | $ 62,563 |
Marketable securities | 48,210 | 37,628 |
Prepaid expenses and other current assets | 3,434 | 9,911 |
Total current assets | 97,032 | 110,102 |
Marketable securities, noncurrent | 8,160 | 9,048 |
Operating lease right-of-use asset | 702 | 834 |
Equipment, net | 238 | 203 |
Other assets, noncurrent | 2,798 | 2,028 |
Total assets | 108,930 | 122,215 |
Current liabilities | ||
Accounts payable | 3,215 | 1,531 |
Accrued expenses and other current liabilities | 3,999 | 3,013 |
Total current liabilities | 7,214 | 4,544 |
Operating lease liabilities, noncurrent | 402 | 448 |
Total liabilities | 7,616 | 4,992 |
Commitments and contingencies (Note 9) | ||
Stockholders’ equity | ||
Preferred stock, par value of $0.00001 per share; 10,000,000 shares authorized at March 31, 2022 and December 31, 2021; no shares issued or outstanding as of March 31, 2022 and December 31, 2021 | ||
Common stock, par value of $0.00001 per share; 300,000,000 shares authorized at March 31, 2022 and December 31, 2021; 25,261,832 shares issued and outstanding at March 31, 2022 and December 31, 2021 | ||
Additional paid-in capital | 275,059 | 273,655 |
Accumulated deficit | (173,050) | (156,112) |
Accumulated other comprehensive loss | (695) | (320) |
Total stockholders’ equity | 101,314 | 117,223 |
Total liabilities and stockholders' equity | $ 108,930 | $ 122,215 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, authorized | 10,000,000 | 10,000,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, authorized | 300,000,000 | 300,000,000 |
Common stock, issued | 25,261,832 | 25,261,832 |
Common stock, outstanding | 25,261,832 | 25,261,832 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Operating expenses | ||
Research and development | $ 13,235 | $ 9,990 |
General and administrative | 3,704 | 3,562 |
Total operating expenses | 16,939 | 13,552 |
Loss from operations | (16,939) | (13,552) |
Other income (expense), net | ||
Interest income, net | 61 | 39 |
Foreign exchange transaction gain (loss), net | (60) | 168 |
Total other income, net | 1 | 207 |
Net loss | $ (16,938) | $ (13,345) |
Net loss per common share, basic and diluted | $ (0.67) | $ (0.53) |
Weighted-average number of shares used in computing net loss per common share, basic and diluted | 25,261,832 | 25,261,832 |
Other comprehensive loss, net of tax | ||
Currency translation loss | $ (170) | $ (524) |
Unrealized loss on marketable securities | (205) | (80) |
Other comprehensive loss, net of tax | (375) | (604) |
Total comprehensive loss | $ (17,313) | $ (13,949) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) |
Beginning balance at Dec. 31, 2020 | $ 165,489 | $ 269,175 | $ (104,360) | $ 674 | |
Beginning balance (in shares) at Dec. 31, 2020 | 25,261,832 | ||||
Stock-based compensation expense | 1,031 | 1,031 | |||
Currency translation loss | (524) | (524) | |||
Net unrealized loss on marketable securities | (80) | (80) | |||
Net loss | (13,345) | (13,345) | |||
Ending balance at Mar. 31, 2021 | 152,571 | 270,206 | (117,705) | 70 | |
Ending balance (in shares) at Mar. 31, 2021 | 25,261,832 | ||||
Beginning balance at Dec. 31, 2021 | 117,223 | 273,655 | (156,112) | (320) | |
Beginning balance (in shares) at Dec. 31, 2021 | 25,261,832 | ||||
Stock-based compensation expense | 1,404 | 1,404 | |||
Currency translation loss | (170) | (170) | |||
Net unrealized loss on marketable securities | (205) | (205) | |||
Net loss | (16,938) | (16,938) | |||
Ending balance at Mar. 31, 2022 | $ 101,314 | $ 275,059 | $ (173,050) | $ (695) | |
Ending balance (in shares) at Mar. 31, 2022 | 25,261,832 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (16,938,000) | $ (13,345,000) |
Adjustment to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 8,000 | 2,000 |
Stock-based compensation | 1,404,000 | 1,031,000 |
Amortization of premiums and discounts on marketable securities | 264,000 | (92,000) |
Amortization of right of use lease asset | 110,000 | 97,000 |
Accretion of lease liability | 16,000 | 19,000 |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | 6,478,000 | (855,000) |
Other assets, noncurrent | (770,000) | (822,000) |
Accounts payable | 1,684,000 | (1,069,000) |
Accrued expenses and other current liabilities | 1,061,000 | 1,002,000 |
Operating lease liabilities | (114,000) | (119,000) |
Net cash used in operating activities | (6,797,000) | (14,151,000) |
Cash flows from investing activities: | ||
Purchases of marketable securities | (26,385,000) | (74,566,000) |
Proceeds from sale of marketable securities | 16,221,000 | |
Purchases of property and equipment | (43,000) | (65,000) |
Net cash used in investing activities | (10,207,000) | (74,631,000) |
Net decrease in cash, cash equivalents and restricted cash | (17,004,000) | (88,782,000) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (171,000) | (604,000) |
Cash, cash equivalents and restricted cash, beginning of period | 62,563,000 | 163,836,000 |
Cash, cash equivalents and restricted cash, end of period | 45,388,000 | 74,450,000 |
Components of cash, cash equivalents and restricted cash | ||
Cash and cash equivalents | 45,388,000 | 74,253,000 |
Restricted cash | 197,000 | |
Cash, cash equivalents and restricted cash, end of period | $ 45,388,000 | 74,450,000 |
Supplemental disclosures of cash flow information: | ||
Cash paid for taxes | 38,000 | |
Supplemental disclosures of noncash activities: | ||
Operating lease liabilities arising from obtaining right-of-use assets | $ 161,000 |
Description of Business, Organi
Description of Business, Organization and Liquidity | 3 Months Ended |
Mar. 31, 2022 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business, Organization and Liquidity | 1. DESCRIPTION OF BUSINESS, ORGANIZATION AND LIQUIDITY Business and Organization Galecto, Inc., together with its consolidated subsidiaries, or the Company or Galecto, is a clinical-stage biotechnology company developing novel therapeutics that are designed to target the biological processes that lie at the heart of fibrotic diseases and cancer. The Company’s initial focus is on the development of small molecule inhibitors of galectin-3 and lysyl oxidase-like 2, or LOXL2, which play key roles in regulating fibrosis and cancer. As of March 31, 2022, the Company’s wholly owned subsidiaries were PharmAkea, Inc. or PharmAkea, Galecto Securities Corporation, and Galecto Biotech AB, a Swedish company. Galecto Biotech ApS, a Danish operating company, is a wholly-owned subsidiary of Galecto Biotech AB. Risks and uncertainties The Company is subject to risks common to companies in the biotechnology industry, including, but not limited to, new technological innovations, protection of proprietary technology, dependence on key personnel, compliance with government regulations and the need to obtain additional financing. Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel infrastructure and extensive compliance reporting capabilities. The Company’s product candidates are in development. 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 obtained, that any products developed will obtain necessary government regulatory approval or that any approved products will be commercially viable. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will generate significant revenue from product sales. The Company operates in an environment of rapid change in technology and substantial competition from pharmaceutical and biotechnology companies. In addition, the Company is dependent upon the services of its employees and consultants. Liquidity and management plans Since inception, the Company has devoted substantially all its efforts to business planning, research and development, recruiting management and technical staff and raising capital, and has financed its operations primarily through the issuance of redeemable convertible preferred shares, debt financings and the Company’s initial public offering, or IPO. As of March 31, 2022, the Company had an accumulated deficit of $ 173.1 million, from recurring losses since inception in 2011. The Company has incurred recurring losses and has no sales as none of its product candidates have obtained the necessary regulatory approval for commercialization and to be marketed as approved products. The Company expects to continue to incur losses as a result of costs and expenses related to the Company’s clinical development and corporate general and administrative activities. The Company had negative cash flows from operating activities during the three months ended March 31, 2022 and 2021 of $ 6.8 million and $ 14.2 million, respectively, and current projections indicate that the Company will have continued negative cash flows for the foreseeable future as it continues to develop its product candidates. Net losses incurred for the three months ended March 31, 2022 and 2021 were $ 16.9 million and $ 13.3 million, respectively. At March 31, 2022, the Company’s cash, cash equivalents and marketable securities amounted to $ 101.8 million and current assets amounted to $ 97.0 million and current liabilities amounted to $ 7.2 million. At December 31, 2021 , the Company’s cash, cash equivalents and marketable securities amounted to $ 109.2 million, current assets amounted to $ 110.1 million and current liabilities amounted to $ 4.5 million. In the future, the Company will consider the following ways to fund its operations including: (1) raising additional capital through equity and/or debt financings; (2) new commercial relationships to help fund future clinical trial costs (i.e. licensing and partnerships); (3) reducing spending on one or more research and development programs by discontinuing development; and/or (4) restructuring operations to change its overhead structure. The Company’s future liquidity needs, and ability to address those needs, will largely be determined by the success of its product candidates and key development and regulatory events and its decisions in the future. Coronavirus pandemic The outbreak of the novel coronavirus, or COVID-19, and ensuing pandemic, has spread worldwide, causing many governments to implement measures to slow the spread of the outbreak. COVID-19 has had a significant impact, both directly and indirectly, on businesses and commerce, as worker shortages have occurred; supply chains have been disrupted; facilities and production have been suspended; and demand for certain goods and services, such as medical services and supplies, has spiked, while demand for other goods and services has fallen. The Company continues to monitor the impact of COVID-19 and assess its strategy accordingly. However, there can be no assurance that the Company will not experience additional negative impacts associated with COVID-19, which could decrease or delay enrollment of patients in the Company’s clinical trials or otherwise causing interruptions or delays in the Company’s clinical trials, programs and services, and negatively impact the Company’s business, financial condition and results of operations. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying interim condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”). The accompanying interim condensed consolidated financial statements as of March 31, 2022 and for the three months ended March 31, 2022 and 2021, and related interim information contained within the notes to the interim condensed consolidated financial statements, are unaudited. In management’s opinion, the unaudited interim condensed consolidated financial statements have been prepared on the same basis as the Company’s audited consolidated financial statements and include all adjustments (including normal recurring adjustments) necessary for the fair presentation of the Company’s financial position as of March 31, 2022, results of operations, statement of stockholders’ equity and its cash flows for the three months ended March 31, 2022 and 2021. All intercompany balances and transactions have been eliminated. These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and accompanying notes contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as filed with the Securities and Exchange Commission (“SEC”) on February 17, 2022 ("2021 Consolidated Financial Statements"). The results for the three months ended March 31, 2022 are not necessarily indicative of the results expected for the full fiscal year or any interim period. For the three months ended March 31, 2022, there have been no changes to the significant accounting policies as disclosed in Note 2 to the Company’s annual consolidated financial statements for the year ended December 31, 2021. Recently issued accounting standards In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses: Measurement of Credit Losses on Financial Instruments , or ASU 2016-13. ASU 2016-13 requires measurement and recognition of expected credit losses for financial assets. In April 2019, the FASB issued clarification to ASU 2016-13 within ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging , and Topic 825, Financial Instruments . The ASU 2016-13 guidance became effective as of January 1, 2020, and must be adopted using a modified retrospective approach, with certain exceptions. This guidance is effective for public business entities that meet the definition of a Securities and Exchange Commission filer, excluding eligible smaller reporting companies for fiscal years beginning after December 15, 2019. For all other entities, including emerging growth companies, it is effective for fiscal years beginning after December 15, 2022. The Company has not yet adopted ASU 2016-13 and is currently assessing the potential impact of adopting ASU 2016-13 on its financial statements and financial statement disclosures. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2022 | |
Investments Debt And Equity Securities [Abstract] | |
Investments | 3. INVESTMENTS Cash in excess of the Company’s immediate requirements is invested in accordance with the Company’s investment policy that primarily seeks to maintain adequate liquidity and preserve capital. A summary of the Company’s available-for-sale investments as of March 31, 2022 and December 31, 2021 consisted of the following (in thousands): At March 31, 2022 Amortized Gross Unrealized Gross Unrealized Fair Marketable securities: Cost Gains Losses Value Corporate bonds $ 48,401 $ — $ ( 191 ) $ 48,210 Total $ 48,401 $ — $ ( 191 ) $ 48,210 Marketable securities, noncurrent: Corporate bonds $ 8,251 $ — $ ( 91 ) $ 8,160 Total $ 8,251 $ — $ ( 91 ) $ 8,160 At December 31, 2021 Amortized Gross Unrealized Gross Unrealized Fair Marketable securities: Cost Gains Losses Value Corporate bonds $ 37,671 $ — $ ( 43 ) $ 37,628 Total $ 37,671 $ — $ ( 43 ) $ 37,628 Marketable securities, noncurrent: Corporate bonds $ 9,082 $ — $ ( 34 ) $ 9,048 Total $ 9,082 $ — $ ( 34 ) $ 9,048 |
Property and Equipment, Net
Property and Equipment, Net | 3 Months Ended |
Mar. 31, 2022 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment, Net | 4. PROPERTY AND EQUIPMENT, NET Property and equipment as of March 31, 2022 consisted of the following (in thousands): March 31, December 31, 2022 2021 Equipment $ 266 $ 223 Less: accumulated depreciation ( 28 ) ( 20 ) Equipment, net $ 238 $ 203 Depreciation expense for the three months ended March 31, 2022 and 2021 was $ 8,000 and $ 2,000 , respectively. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 5. FAIR VALUE MEASUREMENTS Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value are performed in a manner to maximize the use of observable inputs and minimize the use of unobservable inputs. The Company classified its money market funds within Level 1 because their fair values are based on their quoted market prices. The Company classified its debt securities within Level 2 because their fair values are determined using alternative pricing sources or models that utilized market observable inputs. A summary of the assets that are measured at fair value as of March 31, 2022 and December 31, 2021 is as follows (in thousands): Fair Value Measurement at Assets: Carrying Quoted Prices in Significant Significant Money market funds (1) $ 30,555 $ 30,555 $ — $ — Debt securities 56,370 — 56,370 — Total $ 86,925 $ 30,555 $ 56,370 $ — Fair Value Measurement at Assets: Carrying Quoted Prices in Significant Significant Money market funds (1) $ 49,626 49,626 — — Debt securities 46,676 — 46,676 — Total $ 96,302 $ 49,626 $ 46,676 $ — (1) Money market funds with maturities of 90 days or less at the date of purchase are included within cash and cash equivalents in the accompanying condensed consolidated balance sheets and are recognized at fair value. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 3 Months Ended |
Mar. 31, 2022 | |
Prepaid Expense And Other Assets Current [Abstract] | |
Prepaid Expenses and Other Current Assets | 6. PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of the following (in thousands): March 31, December 31, 2022 2021 Prepaid insurance costs $ 1,228 $ 1,728 Research and development tax credit receivable 820 1,682 Contract research and development costs 785 5,569 Value-added tax refund receivable 350 598 Other 251 334 Total prepaid expenses and other current assets $ 3,434 $ 9,911 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2022 | |
Leases [Abstract] | |
Leases | 7. LEASES The Company has the following operating leases: Location Primary Use Lease Renewal Option Copenhagen, Denmark Corporate headquarters January 2025 None London, United Kingdom Office space August 2022 None Gothenburg, Sweden Office space May 2023 None Stevenage, United Kingdom Laboratory space January 2024 None The Company has no finance leases and has elected to apply the short-term lease exception to all leases of one year or less. Rent expense for the three months ended March 31, 2022 and 2021 was $ 0.1 million during both periods. Quantitative information regarding the Company’s leases for the three months ended March 31, 2022 and 2021 was as follows: Three Months Ended Lease Cost 2022 2021 Operating lease cost (in thousands) $ 126 $ 119 Other Information Operating cash flows paid for amounts included (in thousands) $ 114 $ 119 Operating lease liabilities arising from obtaining (in thousands) $ — $ 161 As of March 31, 2022 and December 31, 2021 , the weighted average remaining lease term for operating leases was 2.3 years and 2.4 years, respectively. As of March 31, 2022 and December 31, 2021 , the weighted average discount rate for operating leases was 8 % for both periods. Operating lease liabilities at March 31, 2022 are as follows (in thousands): Operating Future Lease Payments Leases 2022 (excluding the period ended March 31, 2022) $ 316 2023 265 2024 199 2025 17 2026 — Total lease payments 797 Less: imputed interest ( 71 ) Total lease liabilities $ 726 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 3 Months Ended |
Mar. 31, 2022 | |
Payables And Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | 8. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consist of the following (in thousands): March 31, December 31, 2022 2021 Contract research and development costs $ 2,195 $ 1,575 Employee compensation costs 1,113 601 Operating lease liabilities, current 324 399 Other liabilities 367 438 Total accrued expenses and other current liabilities $ 3,999 $ 3,013 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. COMMITMENTS AND CONTINGENCIES There have been no material changes to the Company’s commitments and contingencies since the 2021 Consolidated Financial Statements. The Company’s commitments and contingencies are disclosed in Note 9 of the 2021 Consolidated Financial Statements. Further, the Company’s commitments related to lease agreements are disclosed in Note 7 to the Company’s unaudited interim condensed consolidated financial statements. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | 10. STOCK-BASED COMPENSATION Employee equity plan In March 2020, the Company's Board of Directors and stockholders approved the 2020 Stock Option and Grant Plan (“2020 Plan”). Holders of stock options under the 2020 Plan shall be entitled to exercise the vested portion of the stock option during the term of the grant. If a qualified exit, as defined in the 2020 Plan, occurs, then all of the holders unvested options shall vest immediately. In October 2020, the Company's Board of Directors and stockholders approved the 2020 Equity Incentive Plan (“2020 Equity Plan”). Following the adoption of the 2020 Equity Plan, no further options are available to be issued under the 2020 Plan. Stock options granted under the 2020 Equity Plan generally vest over a four-year period and expire ten years from the grant date. The 2020 Equity Plan will cumulatively increase by 5 percent of the number of shares of common stock issued and outstanding on January 1 st each year. At March 31, 2022, the Company had 1,015,972 options available for future grant under the 2020 Equity Plan. The following table sets forth the activity for the Company’s stock options during the three months ended March 31, 2022: Number of Weighted- Weighted- Aggregate Outstanding at December 31, 2021 3,998,728 $ 6.51 8.3 $ 1,357,655 Granted 1,648,750 3.09 — 110,313 Outstanding at March 31, 2022 5,647,478 $ 5.51 8.6 $ 340,272 Vested and expected to vest at March 31, 2022 5,343,336 $ 5.52 8.9 $ 340,272 Vested and exercisable at March 31, 2022 1,863,013 $ 5.36 7.3 $ 217,145 The weighted-average grant date fair value of all stock options granted for the three months ended March 31, 2022 was $ 2.31 . The intrinsic value at March 31, 2022 was based on the closing price of the Company’s common stock on that date of $ 2.20 per share. Stock-based compensation The grant date fair value of stock options vested during the three months ended March 31, 2022 and 2021 was $ 3.0 million and $ 0.2 million, respectively. Total unrecognized compensation expense related to unvested options granted under the Company’s stock-based compensation plan was $ 14.9 million at March 31, 2022 , which is expected to be recognized over a weighted average period of 2.9 years. The Company recorded stock-based compensation expense related to the issuance of stock as follows (in thousands): Three Months Ended 2022 2021 Research and development $ 653 $ 407 General and administrative 751 624 Total stock-based compensation $ 1,404 $ 1,031 The fair values of the options granted were estimated based on the Black-Scholes model, using the following assumptions: Three Months Ended March 31, 2022 2021 Risk-free interest rate 1.5 % 0.5 % Expected term (in years) 6.1 6.1 Expected volatility 90.2 % 90.5 % Expected dividend yield — — |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 11. NET LOSS PER SHARE Basic and diluted net loss per share is calculated as follows (in thousands except share and per share amounts): Three Months Ended 2022 2021 Net loss $ ( 16,938 ) $ ( 13,345 ) Weighted-average number of shares used in computing net loss 25,261,832 25,261,832 Net loss per common share, basic and diluted $ ( 0.67 ) $ ( 0.53 ) The following outstanding potentially dilutive securities have been excluded from the calculation of diluted net loss per share, as their effect is anti-dilutive: Three Months Ended 2022 2021 Stock options to purchase common stock 5,647,478 3,474,411 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | 12. SUBSEQUENT EVENTS The Company has evaluated subsequent events through the date on which the unaudited interim condensed consolidated financial statements were issued. The Company has concluded that no subsequent events have occurred that require disclosure to the unaudited interim condensed consolidated financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Recently issued accounting standards | Recently issued accounting standards In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses: Measurement of Credit Losses on Financial Instruments , or ASU 2016-13. ASU 2016-13 requires measurement and recognition of expected credit losses for financial assets. In April 2019, the FASB issued clarification to ASU 2016-13 within ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging , and Topic 825, Financial Instruments . The ASU 2016-13 guidance became effective as of January 1, 2020, and must be adopted using a modified retrospective approach, with certain exceptions. This guidance is effective for public business entities that meet the definition of a Securities and Exchange Commission filer, excluding eligible smaller reporting companies for fiscal years beginning after December 15, 2019. For all other entities, including emerging growth companies, it is effective for fiscal years beginning after December 15, 2022. The Company has not yet adopted ASU 2016-13 and is currently assessing the potential impact of adopting ASU 2016-13 on its financial statements and financial statement disclosures. |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Investments Debt And Equity Securities [Abstract] | |
Summary of Available-for-Sale Investments | A summary of the Company’s available-for-sale investments as of March 31, 2022 and December 31, 2021 consisted of the following (in thousands): At March 31, 2022 Amortized Gross Unrealized Gross Unrealized Fair Marketable securities: Cost Gains Losses Value Corporate bonds $ 48,401 $ — $ ( 191 ) $ 48,210 Total $ 48,401 $ — $ ( 191 ) $ 48,210 Marketable securities, noncurrent: Corporate bonds $ 8,251 $ — $ ( 91 ) $ 8,160 Total $ 8,251 $ — $ ( 91 ) $ 8,160 At December 31, 2021 Amortized Gross Unrealized Gross Unrealized Fair Marketable securities: Cost Gains Losses Value Corporate bonds $ 37,671 $ — $ ( 43 ) $ 37,628 Total $ 37,671 $ — $ ( 43 ) $ 37,628 Marketable securities, noncurrent: Corporate bonds $ 9,082 $ — $ ( 34 ) $ 9,048 Total $ 9,082 $ — $ ( 34 ) $ 9,048 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Property Plant And Equipment [Abstract] | |
Summary of Property and Equipment | Property and equipment as of March 31, 2022 consisted of the following (in thousands): March 31, December 31, 2022 2021 Equipment $ 266 $ 223 Less: accumulated depreciation ( 28 ) ( 20 ) Equipment, net $ 238 $ 203 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets Measured at Fair Value | A summary of the assets that are measured at fair value as of March 31, 2022 and December 31, 2021 is as follows (in thousands): Fair Value Measurement at Assets: Carrying Quoted Prices in Significant Significant Money market funds (1) $ 30,555 $ 30,555 $ — $ — Debt securities 56,370 — 56,370 — Total $ 86,925 $ 30,555 $ 56,370 $ — Fair Value Measurement at Assets: Carrying Quoted Prices in Significant Significant Money market funds (1) $ 49,626 49,626 — — Debt securities 46,676 — 46,676 — Total $ 96,302 $ 49,626 $ 46,676 $ — (1) Money market funds with maturities of 90 days or less at the date of purchase are included within cash and cash equivalents in the accompanying condensed consolidated balance sheets and are recognized at fair value. |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Prepaid Expense And Other Assets Current [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following (in thousands): March 31, December 31, 2022 2021 Prepaid insurance costs $ 1,228 $ 1,728 Research and development tax credit receivable 820 1,682 Contract research and development costs 785 5,569 Value-added tax refund receivable 350 598 Other 251 334 Total prepaid expenses and other current assets $ 3,434 $ 9,911 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Leases [Abstract] | |
Summary of Operating Leases | The Company has the following operating leases: Location Primary Use Lease Renewal Option Copenhagen, Denmark Corporate headquarters January 2025 None London, United Kingdom Office space August 2022 None Gothenburg, Sweden Office space May 2023 None Stevenage, United Kingdom Laboratory space January 2024 None |
Quantitative Information Regarding Leases | Quantitative information regarding the Company’s leases for the three months ended March 31, 2022 and 2021 was as follows: Three Months Ended Lease Cost 2022 2021 Operating lease cost (in thousands) $ 126 $ 119 Other Information Operating cash flows paid for amounts included (in thousands) $ 114 $ 119 Operating lease liabilities arising from obtaining (in thousands) $ — $ 161 |
Summary of Operating Lease Liabilities | Operating lease liabilities at March 31, 2022 are as follows (in thousands): Operating Future Lease Payments Leases 2022 (excluding the period ended March 31, 2022) $ 316 2023 265 2024 199 2025 17 2026 — Total lease payments 797 Less: imputed interest ( 71 ) Total lease liabilities $ 726 |
Accrued Expenses And Other Cu_2
Accrued Expenses And Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Payables And Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consist of the following (in thousands): March 31, December 31, 2022 2021 Contract research and development costs $ 2,195 $ 1,575 Employee compensation costs 1,113 601 Operating lease liabilities, current 324 399 Other liabilities 367 438 Total accrued expenses and other current liabilities $ 3,999 $ 3,013 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Stock Options Activity | The following table sets forth the activity for the Company’s stock options during the three months ended March 31, 2022: Number of Weighted- Weighted- Aggregate Outstanding at December 31, 2021 3,998,728 $ 6.51 8.3 $ 1,357,655 Granted 1,648,750 3.09 — 110,313 Outstanding at March 31, 2022 5,647,478 $ 5.51 8.6 $ 340,272 Vested and expected to vest at March 31, 2022 5,343,336 $ 5.52 8.9 $ 340,272 Vested and exercisable at March 31, 2022 1,863,013 $ 5.36 7.3 $ 217,145 |
Summary of Stock-based Compensation Expense | The Company recorded stock-based compensation expense related to the issuance of stock as follows (in thousands): Three Months Ended 2022 2021 Research and development $ 653 $ 407 General and administrative 751 624 Total stock-based compensation $ 1,404 $ 1,031 |
Summary of Fair Value Assumptions of Options Granted Estimated Based on Black-Scholes Model | The fair values of the options granted were estimated based on the Black-Scholes model, using the following assumptions: Three Months Ended March 31, 2022 2021 Risk-free interest rate 1.5 % 0.5 % Expected term (in years) 6.1 6.1 Expected volatility 90.2 % 90.5 % Expected dividend yield — — |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Loss Per Share | Basic and diluted net loss per share is calculated as follows (in thousands except share and per share amounts): Three Months Ended 2022 2021 Net loss $ ( 16,938 ) $ ( 13,345 ) Weighted-average number of shares used in computing net loss 25,261,832 25,261,832 Net loss per common share, basic and diluted $ ( 0.67 ) $ ( 0.53 ) |
Schedule of Antidilutive Securities Excluded from Calculation of Diluted Net Loss Per Share | The following outstanding potentially dilutive securities have been excluded from the calculation of diluted net loss per share, as their effect is anti-dilutive: Three Months Ended 2022 2021 Stock options to purchase common stock 5,647,478 3,474,411 |
Description of Business, Orga_2
Description of Business, Organization and Liquidity - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Description Of Business Organization And Liquidity [Line Items] | |||
Accumulated deficit | $ 173,050 | $ 156,112 | |
Net loss | (16,938) | $ (13,345) | |
Cash, cash equivalents and marketable securities | 101,800 | 109,200 | |
Current assets | 97,032 | 110,102 | |
Current liabilities | 7,214 | $ 4,544 | |
Clinical Development and Corporate General and Administrative Activities | |||
Description Of Business Organization And Liquidity [Line Items] | |||
Net loss | $ (6,800) | $ (14,200) |
Investments - Summary of Availa
Investments - Summary of Available-for-Sale Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Schedule of Available for Sale Securities [Line Items] | ||
Debt Securities, Available-for-sale, Type [Extensible List] | us-gaap:CorporateDebtSecuritiesMember | us-gaap:CorporateDebtSecuritiesMember |
Investments - Current | ||
Schedule of Available for Sale Securities [Line Items] | ||
Amortized Cost | $ 48,401 | $ 37,671 |
Gross Unrealized Losses | (191) | (43) |
Fair Value | 48,210 | 37,628 |
Investments - Noncurrent | ||
Schedule of Available for Sale Securities [Line Items] | ||
Amortized Cost | 8,251 | 9,082 |
Gross Unrealized Losses | (91) | (34) |
Fair Value | $ 8,160 | $ 9,048 |
Property and Equipment, Net - S
Property and Equipment, Net - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 266 | $ 223 |
Less: accumulated depreciation | (28) | (20) |
Equipment, net | $ 238 | $ 203 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Property Plant And Equipment [Abstract] | ||
Depreciation expense | $ 8,000 | $ 2,000 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Assets Measured at Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets fair value | $ 86,925 | $ 96,302 |
Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets fair value | 30,555 | 49,626 |
Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets fair value | 56,370 | 46,676 |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets fair value | 30,555 | 49,626 |
Level 1 | Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets fair value | 30,555 | 49,626 |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets fair value | 56,370 | 46,676 |
Level 2 | Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets fair value | $ 56,370 | $ 46,676 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Prepaid Expense And Other Assets Current [Abstract] | ||
Prepaid insurance costs | $ 1,228 | $ 1,728 |
Research and development tax credit receivable | 820 | 1,682 |
Contract research and development costs | 785 | 5,569 |
Value-added tax refund receivable | 350 | 598 |
Other | 251 | 334 |
Total prepaid expenses and other current assets | $ 3,434 | $ 9,911 |
Leases - Summary of Operating L
Leases - Summary of Operating Leases (Details) | 3 Months Ended |
Mar. 31, 2022 | |
Copenhagen, Denmark | |
Operating Leased Assets [Line Items] | |
Operating lease, expiration date | Jan. 31, 2025 |
Operating lease,renewal option | None |
London,United Kingdom | |
Operating Leased Assets [Line Items] | |
Operating lease, expiration date | Aug. 31, 2022 |
Operating lease,renewal option | None |
Gothenburg, Sweden | |
Operating Leased Assets [Line Items] | |
Operating lease, expiration date | May 31, 2023 |
Operating lease,renewal option | None |
Stevenage, United Kingdom | |
Operating Leased Assets [Line Items] | |
Operating lease, expiration date | Jan. 31, 2024 |
Operating lease,renewal option | None |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Leases [Line Items] | |||
Rent expense | $ 0.1 | $ 0.1 | |
Weighted average remaining lease term for operating leases | 2 years 3 months 18 days | 2 years 4 months 24 days | |
Weighted average discount rate for operating leases | 8.00% | 8.00% |
Leases - Quantitative Informati
Leases - Quantitative Information Regarding Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Lease Cost | ||
Operating lease cost (in thousands) | $ 126 | $ 119 |
Operating cash flows paid for amounts included in the measurement of lease liabilities (in thousands) | $ 114 | 119 |
Operating lease liabilities arising from obtaining right-of-use assets (in thousands) | $ 161 |
Leases - Summary of Operating_2
Leases - Summary of Operating Lease Liabilities (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Future Lease Payments | |
2022 (excluding the period ended March 31, 2022) | $ 316 |
2023 | 265 |
2024 | 199 |
2025 | 17 |
Total lease payments | 797 |
Less: imputed interest | (71) |
Total lease liabilities | $ 726 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Payables And Accruals [Abstract] | ||
Contract research and development costs | $ 2,195 | $ 1,575 |
Employee compensation costs | 1,113 | 601 |
Operating lease liabilities, current | $ 324 | $ 399 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued Liabilities And Other Liabilities | Accrued Liabilities And Other Liabilities |
Other liabilities | $ 367 | $ 438 |
Total accrued expenses and other current liabilities | $ 3,999 | $ 3,013 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | |
Oct. 31, 2020 | Mar. 31, 2022 | Mar. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of options, granted | 1,648,750 | ||
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average grant date fair value of stock options granted | $ 2.31 | ||
Intrinsic value per share of stock options | $ 2.20 | ||
Fair value of stock options vested | $ 3 | $ 0.2 | |
2020 Plan | Unvested Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation expense | $ 14.9 | ||
2020 Plan | Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options available for future grant | 0 | ||
2020 Equity Incentive Plan | Unvested Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation expense that is expected to be recognized over a weighted-average period | 2 years 10 months 24 days | ||
2020 Equity Incentive Plan | Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options, vesting period | 4 years | ||
Stock options, expiration period | 10 years | ||
Percentage increase of number of shares of common stock issued and outstanding | 5.00% | ||
Stock options available for future grant | 1,015,972 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Options Activity (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Number of Options, Outstanding | 3,998,728 | |
Number of Options, Granted | 1,648,750 | |
Number of Options, Outstanding | 5,647,478 | 3,998,728 |
Number of Options, Vested and expected to vest | 5,343,336 | |
Number of Options, Vested and exercisable | 1,863,013 | |
Weighted average exercise price per share, Outstanding | $ 6.51 | |
Weighted average exercise price per share, Granted | 3.09 | |
Weighted average exercise price per share, Outstanding | 5.51 | $ 6.51 |
Weighted average exercise price per share, Vested and expected | 5.52 | |
Weighted average exercise price per share, Vested and exercisable | $ 5.36 | |
Weighted average remaining contractual term (in years), Outstanding | 8 years 7 months 6 days | 8 years 3 months 18 days |
Weighted average remaining contractual term (in years), Vested and expected to vest | 8 years 10 months 24 days | |
Weighted average remaining contractual term (in years), Vested and exercisable | 7 years 3 months 18 days | |
Aggregate intrinsic value, Outstanding | $ 1,357,655 | |
Aggregate intrinsic value, Granted | 110,313 | |
Aggregate intrinsic value, Outstanding | 340,272 | $ 1,357,655 |
Aggregate intrinsic value, Vested and expected to vest | 340,272 | |
Aggregate intrinsic value, Vested and exercisable | $ 217,145 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Stock-based Compensation Expenses Related to Issuance of Stock (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | $ 1,404 | $ 1,031 |
Research and Development | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | 653 | 407 |
General and Administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | $ 751 | $ 624 |
Stock-Based Compensation - Su_3
Stock-Based Compensation - Summary of Fair Value Assumptions of Options Granted Estimated Based on Black-Scholes Model (Details) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Risk-free interest rate | 1.50% | 0.50% |
Expected term (in years) | 6 years 1 month 6 days | 6 years 1 month 6 days |
Expected volatility | 90.20% | 90.50% |
Expected dividend yield | 0.00% | 0.00% |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Earnings Per Share [Abstract] | ||
Net loss | $ (16,938) | $ (13,345) |
Weighted-average number of shares used in computing net loss per common share, basic and diluted | 25,261,832 | 25,261,832 |
Net loss per common share, basic and diluted | $ (0.67) | $ (0.53) |
Net Loss Per Share - Schedule_2
Net Loss Per Share - Schedule of Antidilutive Securities Excluded from Calculation of Diluted Net Loss Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Stock Options to Purchase Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 5,647,478 | 3,474,411 |