Sigilon Therapeutics (SGTX) 10-Q7 Aug 232023 Q2 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2023	Aug. 01, 2023
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Document Transition Report	false
Entity Registrant Name	Sigilon Therapeutics, Inc.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-39746
Entity Tax Identification Number	47-4005543
Entity Address, Address Line One	100 Binney Street, Suite 600
Entity Address, City or Town	Cambridge
Entity Address State Or Province	MA
Entity Address, Postal Zip Code	02142
City Area Code	617
Local Phone Number	336-7540
Title of 12(b) Security	Common Stock, $0.001 par value per share
Trading Symbol	SGTX
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		2,514,498
Entity Central Index Key	0001821323
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Amendment Flag	false

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 19,621	$ 42,066
Marketable securities	15,279	27,560
Accounts receivable	4,495	2,171
Unbilled accounts receivable	2,363	1,287
Prepaid expenses and other current assets	2,860	1,077
Restricted cash, current portion	250	250
Total current assets	44,868	74,411
Property and equipment, net	2,589	2,854
Rightofuse assets	7,062	8,979
Restricted cash	1,040	1,034
Total assets	55,559	87,278
Current liabilities:
Accounts payable	1,110	936
Accrued expenses and other current liabilities	5,835	6,021
Lease liabilities, current portion	4,523	4,485
Current portion of longterm debt		6,667
Deferred revenue from related party, current portion	13,779	12,885
Total current liabilities	25,247	30,994
Lease liability, net of current portion	2,865	4,888
Longterm debt, net of discount and current portion		12,021
Other liabilities		233
Total liabilities	28,112	48,136
Commitments and contingencies (Note 9)
Stockholders' equity
Common stock, par value $0.001 per share; 175,000,000 shares authorized at June 30, 2023 and December 31, 2022; 2,502,084 and 2,497,429 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively	3	3
Preferred stock, par value $0.001 per share; 25,000,000 shares authorized at June 30, 2023 and December 31, 2022; no shares issued and outstanding at June 30, 2023 and December 31, 2022
Additional paid-in capital	299,305	296,368
Accumulated other comprehensive loss	(177)	(429)
Accumulated deficit	(271,684)	(256,800)
Total stockholders' equity	27,447	39,142
Total liabilities and stockholders' equity	$ 55,559	$ 87,278

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2023	Dec. 31, 2022
Condensed Consolidated Balance Sheets
Common stock par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	175,000,000	175,000,000
Common stock, shares issued (in shares)	2,502,084	2,497,429
Common stock, shares outstanding (in shares)	2,502,084	2,497,429
Preferred Stock par value (in dollars per share)	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	25,000,000	25,000,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Revenue
Collaboration revenue	$ 5,900	$ 2,883	$ 10,758	$ 6,048
Operating expenses:
Research and development	7,451	11,877	15,233	23,495
General and administrative	5,884	5,042	10,207	10,066
Total operating expenses	13,335	16,919	25,440	33,561
Loss from operations	(7,435)	(14,036)	(14,682)	(27,513)
Other income (expense), net:
Interest income	433	178	909	242
Interest expense	(310)	(543)	(921)	(1,034)
Other income, net	81	55	85	100
Loss on extinguishment from debt	(275)		(275)
Total other income (expense), net	(71)	(310)	(202)	(692)
Net loss attributable to ordinary shareholders	$ (7,506)	$ (14,346)	$ (14,884)	$ (28,205)
Net loss per share attributable to common stockholders-basic (in dollars per share)	$ (3)	$ (5.76)	$ (5.95)	$ (11.32)
Net loss per share attributable to common stockholders-diluted (in dollars per share)	$ (3)	$ (5.76)	$ (5.95)	$ (11.32)
Weighted average common stock outstanding-basic (in shares)	2,501,900	2,492,251	2,499,701	2,490,779
Weighted average common stock outstanding-diluted (in shares)	2,501,900	2,492,251	2,499,701	2,490,779
Other comprehensive gain (loss)
Unrealized gain (loss) on marketable debt securities	$ 96	$ (167)	$ 252	$ (546)
Total other comprehensive gain (loss)	96	(167)	252	(546)
Total comprehensive loss	$ (7,410)	$ (14,513)	$ (14,632)	$ (28,751)

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stock and Stockholders' Equity - USD ($) $ in Thousands	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Total
Beginning balance at Dec. 31, 2021	$ 3	$ 290,406	$ (10)	$ (213,239)	$ 77,160
Beginning balance (in shares) at Dec. 31, 2021	2,489,222
Issuance of common stock upon exercise of stock options		1			1
Issuance of common stock upon exercise of stock options (in shares)	64
Issuance of ESPP shares		47			47
Issuance of ESPP shares (in shares)	2,963
Stockbased compensation expense		1,618			1,618
Unrealized gain on marketable debt securities			(379)		(379)
Net loss				(13,859)	(13,859)
Ending balance at Mar. 31, 2022	$ 3	292,072	(389)	(227,098)	64,588
Ending balance (in shares) at Mar. 31, 2022	2,492,249
Beginning balance at Dec. 31, 2021	$ 3	290,406	(10)	(213,239)	77,160
Beginning balance (in shares) at Dec. 31, 2021	2,489,222
Net loss					(28,205)
Ending balance at Jun. 30, 2022	$ 3	293,803	(556)	(241,444)	51,806
Ending balance (in shares) at Jun. 30, 2022	2,492,249
Beginning balance at Dec. 31, 2021	$ 3	290,406	(10)	(213,239)	77,160
Beginning balance (in shares) at Dec. 31, 2021	2,489,222
Net loss					(43,600)
Ending balance at Dec. 31, 2022	$ 3	296,368	(429)	(256,800)	39,142
Ending balance (in shares) at Dec. 31, 2022	2,497,429
Beginning balance at Mar. 31, 2022	$ 3	292,072	(389)	(227,098)	64,588
Beginning balance (in shares) at Mar. 31, 2022	2,492,249
Stockbased compensation expense		1,731			1,731
Unrealized gain on marketable debt securities			(167)		(167)
Net loss				(14,346)	(14,346)
Ending balance at Jun. 30, 2022	$ 3	293,803	(556)	(241,444)	51,806
Ending balance (in shares) at Jun. 30, 2022	2,492,249
Beginning balance at Dec. 31, 2022	$ 3	296,368	(429)	(256,800)	39,142
Beginning balance (in shares) at Dec. 31, 2022	2,497,429
Issuance of ESPP shares		25			25
Issuance of ESPP shares (in shares)	4,467
Stockbased compensation expense		1,349			1,349
Unrealized gain on marketable debt securities			156		156
Net loss				(7,378)	(7,378)
Ending balance at Mar. 31, 2023	$ 3	297,742	(273)	(264,178)	33,294
Ending balance (in shares) at Mar. 31, 2023	2,501,896
Beginning balance at Dec. 31, 2022	$ 3	296,368	(429)	(256,800)	$ 39,142
Beginning balance (in shares) at Dec. 31, 2022	2,497,429
Issuance of common stock upon exercise of stock options (in shares)					188
Net loss					$ (14,884)
Ending balance at Jun. 30, 2023	$ 3	299,305	(177)	(271,684)	27,447
Ending balance (in shares) at Jun. 30, 2023	2,502,084
Beginning balance at Mar. 31, 2023	$ 3	297,742	(273)	(264,178)	33,294
Beginning balance (in shares) at Mar. 31, 2023	2,501,896
Issuance of common stock upon exercise of stock options		4			4
Issuance of common stock upon exercise of stock options (in shares)	188
Stockbased compensation expense		1,559			1,559
Unrealized gain on marketable debt securities			96		96
Net loss				(7,506)	(7,506)
Ending balance at Jun. 30, 2023	$ 3	$ 299,305	$ (177)	$ (271,684)	$ 27,447
Ending balance (in shares) at Jun. 30, 2023	2,502,084

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash flows from operating activities:
Net loss	$ (14,884)	$ (28,205)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization expense	625	633
Gain on disposal of fixed assets	(10)	(20)
Stockbased compensation expense	2,908	3,349
Noncash lease expense	1,917	2,114
Noncash interest expense	77	140
Loss on debt extinguishment	275
Amortization of (discount) premium on marketable securities	(39)	45
Changes in operating assets and liabilities:
Accounts receivable	(2,324)	36
Unbilled accounts receivable	(1,076)
Prepaid expenses and other current assets	(1,782)	(873)
Accounts payable	205	(1,095)
Accrued expenses and other current liabilities	(126)	(2,374)
Other liabilities	(233)	281
Lease liabilities	(1,985)	(2,256)
Deferred revenue	894	(6,044)
Net cash used in operating activities	(15,558)	(34,269)
Cash flows from investing activities:
Purchases of marketable securities	(6,892)	(41,040)
Proceeds from maturities of marketable securities	19,464	3,000
Purchase of property and equipment	(490)	(506)
Proceed from the sale of fixed assets	48	169
Net cash provided by (used in) investing activities	12,130	(38,377)
Cash flows from financing activities:
Repayment of debt	(19,040)
Proceeds from the exercise of common stock options and employee equity plans	29	48
Net cash (used in) provided by financing activities	(19,011)	48
Net decrease in cash, cash equivalents and restricted cash	(22,439)	(72,598)
Cash, cash equivalents and restricted cash at beginning of period	43,350	108,511
Cash, cash equivalents and restricted cash at end of period	20,911	35,913
Supplemental disclosure of cash flow information:
Cash paid for interest	841	888
Supplemental disclosures of noncash investing and financing activities:
Gain on trade-in of fixed assets	40
Sale of property and equipment in prepaid expenses and other current assets	1
Purchases of property and equipment included in accounts payable and accrued expenses	$ 21	5
Right-of-use assets obtained in exchange for lease liabilities		$ 68

Nature of the Business and Basi

Nature of the Business and Basis of Presentation	6 Months Ended
Nature of the Business and Basis of Presentation	Jun. 30, 2023
Nature of the Business and Basis of Presentation
Nature of the Business and Basis of Presentation	1. Nature of the Business and Basis of Presentation Sigilon Therapeutics, Inc. (the “Company” or “Sigilon”) is a preclinical stage biotechnology company pioneering a new class of therapeutics and seeking to develop functional cures for patients with a wide range of diseases by providing stable and durable levels of therapeutic molecules to patients. The Company was incorporated on May 14, 2015 under the laws of the State of Delaware. The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, the successful completion of research and development, development by competitors of new technological innovations, dependence on key personnel, protection of technology, compliance with government regulations, and the ability to secure additional capital to fund operations and commercial success of its product candidates. Since its inception, the Company has devoted substantially all of its efforts to raising capital, obtaining financing, and incurring research and development costs related to advancing its biomedical platform. 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 and infrastructure and extensive compliance-reporting capabilities. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales. Proposed Acquisition by Eli Lilly and Company On June 28, 2023, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Eli Lilly and Company, an Indiana corporation (“Lilly”), and Lilly’s wholly owned subsidiary, Shenandoah Acquisition Corporation, a Delaware corporation (the “Purchaser”). Pursuant to the Merger Agreement, and upon the terms and subject to the conditions thereof, Purchaser will commence a tender offer (the “Offer”) to purchase any and all of the issued and outstanding shares (the “Shares”) of common stock, par value $0.001 per share (the “Common Stock”), of the Company in exchange for (a) $14.92 per Share, net to the stockholder in cash, without interest (the “Closing Amount”), plus (b) one contingent value right per Share (each, a “CVR”), which represents the contractual right to receive up to three contingent payments for an aggregate of up to $111.64 per CVR, net to the stockholder in cash, without interest and less any tax withholding, upon the achievement of certain specified milestones. Following the consummation of the Offer and the satisfaction or waiver of certain conditions as set forth in the Merger Agreement, Purchaser will be merged with and into us, or the Merger, without a meeting of our stockholders in accordance with Section 251(h) of the General Corporation Law of the State of Delaware, and we will be the surviving corporation and a wholly owned subsidiary of Lilly. As a result of the Merger, we will cease to be a publicly traded company. The obligation of Lilly and Purchaser to consummate the Offer is subject to various conditions, including, among others, that there be validly tendered and not validly withdrawn prior to the expiration of the Offer a number of Shares that, together with the number of Shares, if any, then owned beneficially by Lilly and Purchaser (together with their wholly owned subsidiaries) would represent a majority of the Shares outstanding as of the consummation of the Offer, or the Minimum Tender Condition. The Minimum Tender Condition may not be waived by Purchaser without our prior written consent. In addition, the obligation of Purchaser to consummate the Offer is conditioned upon, among other things, the accuracy of the representations and warranties of the Company (subject to certain materiality exceptions), material compliance by the Company with its covenants under the Merger Agreement, and other customary closing conditions. Consummation of the Offer is not subject to a financing condition. The Merger Agreement includes customary representations, warranties and covenants. We have agreed, among other things, to use commercially reasonable efforts to operate our business in the ordinary course until the time at which the Purchaser irrevocably accepts for purchase all Shares validly tendered (and not validly withdrawn) pursuant to the Offer and not to engage in specified types of transactions during such period. We have also agreed to customary non-solicitation restrictions, including not to initiate, solicit, knowingly facilitate or engage in discussions with third parties regarding other proposals for alternative business combination transactions involving us or change the recommendation of our Board of Directors to our stockholders regarding the Offer, in each case, except as otherwise permitted by the Merger Agreement, including to enter into an alternative transaction that constitutes a Superior Proposal (as defined in the Merger Agreement) in compliance with our Board’s fiduciary duties under applicable law and subject to payment of a termination fee. The Merger Agreement also contains customary termination provisions for both Lilly and us and, under certain circumstances, may require us to pay Lilly a termination fee of $1.3 million. Basis of Presentation The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared in accordance with (i) U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and (ii) the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, such financial statements do not include all the information and footnotes required by U.S. GAAP for a complete set of financial statements. In the opinion of management, the Unaudited Condensed Financial Statements include all adjustments, consisting of normal recurring accruals and other adjustments, considered necessary for a fair statement of the Company’s financial position, results of operations, stockholders’ equity and cash flows as of and for the periods presented. The accompanying Condensed Consolidated Balance Sheet as of December 31, 2022 was derived from the Company’s audited financial statements at that date but does not include all of the footnote disclosures required by U.S. GAAP. The Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited financial statements and related notes included in its Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”). The Company’s significant accounting policies are described in Note 2 to the Notes to Financial Statements in the 2022 Form 10-K and are updated, as necessary, in subsequent Form 10-Q filings. Reverse Stock Split On May 22, 2023, the Company effected a 1-for-13 reverse stock split of the Company’s issued and outstanding common stock. All shares, stock options, warrants and per share information presented in the financial statements have been adjusted to reflect the reverse stock split on a retroactive basis for all periods presented. There was no change in the par value and authorized number of shares of the Company’s common stock as part of the reverse stock split. Going Concern The Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued. From its inception through June 30, 2023, the Company has funded its operations primarily with proceeds from its initial public offering, sales of convertible preferred stock, payments received under its collaboration agreement and proceeds from borrowings under loan and security agreements. The Company has incurred recurring losses since inception, including net losses of $7.5 million and $14.9 million for the three and six months ended June 30, 2023, respectively, and $43.6 million for the year ended December 31, 2022. In addition, as of June 30, 2023, the Company had an accumulated deficit of $271.7 million. The Company expects to generate significant losses and negative cash flows from operations for the foreseeable future. Based on its current operating plans, the Company believes its cash, cash equivalents and marketable securities of $34.9 million as of June 30, 2023 will be sufficient to fund its anticipated level of operations and capital expenditures for a period of at least 12 months from the issuance date of this Quarterly Report. In the event that the proposed acquisition by Eli Lilly and Company as described in Note 1 is not consummated, the Company will seek additional funding through equity financings, debt financing, or additional collaboration agreements. If the Company is unable to raise additional funds through equity financing, debt financings or additional collaboration agreements the Company may be required to delay, limit, reduce or terminate product development or future commercialization efforts or grant rights to develop and market products or product candidates that the Company would otherwise prefer to develop and market itself.

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
Summary of Significant Accounting Policies	Jun. 30, 2023
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	2. Summary Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. Estimates and assumptions reflected in these financial statements include, but are not limited to, revenue recognition, research and development expenses and stock-based awards. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results may differ from those estimates or assumptions. Concentration of Credit Risk and of Significant Suppliers The financial instruments that potentially subject the Company to concentrations of credit risk are cash and accounts receivable. The Company does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. As of June 30, 2023 and December 31, 2022, 100% of the Company’s receivables were related to the Company’s collaboration agreements with Eli Lilly and Company (Note 8). The Company is dependent on third-party manufacturers to supply certain products for research and development activities in its programs. The Company currently has a supplier of certain raw materials that would be considered a sole supplier. If the Company cannot access additional suppliers or secure sufficient inventory of these raw materials, its programs could be adversely affected by an interruption in the availability of these raw materials. Net Income (Loss) per Share The Company only has one class of shares outstanding and basic net income (loss) per common share is computed by dividing the net income (loss) by the weighted average number of shares of common stock outstanding for the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding for the period, including potential dilutive common shares assuming the dilutive effect of outstanding stock awards. For periods in which the Company reports a net loss, diluted net loss per common share is the same as basic net loss per common share, since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.

Fair Value Measurements and mar

Fair Value Measurements and marketable securities	6 Months Ended
Fair Value Measurements and marketable securities	Jun. 30, 2023
Fair Value Measurements and marketable securities
Fair Value Measurements and marketable securities	3. Fair Value Measurements and marketable securities Value Measurements The following tables present information about the Company’s financial assets that have been measured at fair value as of June 30, 2023 and indicate the fair value of the hierarchy of the valuation inputs utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair value determined by Level 2 inputs utilize observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted market prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. During the six months ended June 30, 2023, there were no transfers between Level 1 and Level 2 The following table summarizes the Company’s cash equivalents and marketable securities as of June 30, 2023 and December 31, 2022 (in thousands): Fair value measurements as of June 30, 2023 Level 1 Level 2 Level 3 Total Cash equivalents Money market funds $ 13,437 $ — $ — $ 13,437 U.S. Treasuries — 2,969 — 2,969 Total cash equivalents 13,437 2,969 — 16,406 Marketable securities Corporate bonds — 8,332 — 8,332 U.S. Treasuries — 6,947 — 6,947 Total marketable securities — 15,279 — 15,279 Total $ 13,437 $ 18,248 $ — $ 31,685 Fair value measurements as of December 31, 2022 Level 1 Level 2 Level 3 Total Cash equivalents Money market funds $ 29,310 $ — $ — $ 29,310 Commercial paper — 1,994 — 1,994 U.S. Government Agencies — 4,999 — 4,999 Total cash equivalents 29,310 6,993 — 36,303 Marketable securities Corporate bonds — 21,594 — 21,594 Commercial paper — 1,738 — 1,738 U.S. Government Agencies — 1,235 — 1,235 U.S. Treasuries — 2,993 — 2,993 Total marketable securities — 27,560 — 27,560 Total $ 29,310 $ 34,553 $ — $ 63,863 Marketable Securities The following tables summarizes the Company’s available-for-sale marketable debt securities as of June 30, 2023 and December 31, 2022 (in thousands): Fair value measurements as of June 30, 2023 Gross Gross Amortized Unrealized Unrealized Credit Cost Gains Losses Losses Total Corporate bonds $ 8,507 $ — $ (175) $ — $ 8,332 U.S. Treasuries 6,948 — (1) — 6,947 Total $ 15,455 $ — $ (176) $ — $ 15,279 Fair value measurements as of December 31, 2022 Gross Gross Amortized Unrealized Unrealized Credit Cost Gains Losses Losses Total Corporate bonds $ 21,994 $ — $ (400) $ — $ 21,594 Commercial paper 1,743 — (5) — 1,738 U.S. Government Agencies 1,248 — (13) — 1,235 U.S. Treasuries 2,999 — (6) — 2,993 Total $ 27,984 $ — $ (424) $ — $ 27,560 The unrealized losses at June 30, 2023 and December 31, 2022 were attributed to changes in interest rates and unrealized losses do not represent credit losses. The following table summarizes the Company’s available-for-sale marketable debt securities by contractual maturity as of June 30, 2023 and December 31, 2022 (in thousands): June 30, December 31, 2023 2022 Maturities in one year or less $ 7,436 $ 23,231 Maturities between one and two years 7,843 4,329 Total $ 15,279 $ 27,560 The carrying value of the Company’s long-term debt approximates its fair value at December 31, 2022 because the debt bears interest at a variable market rate and the Company’s credit risk has not materially changed since the inception of the agreement. As of June 30, 2023 and December 31, 2022 the Company did not have any other financial assets and liabilities that were measured at fair value on a recurring basis.

Property and Equipment, Net

Property and Equipment, Net	6 Months Ended
Property and Equipment, Net	Jun. 30, 2023
Property and Equipment, Net
Property and Equipment, Net	4. Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): June 30, December 31, 2023 2022 Laboratory equipment $ 6,191 $ 6,301 Leasehold improvements 78 78 Furniture and fixtures 620 620 Computers and software 273 177 7,162 7,176 Less: Accumulated depreciation and amortization (4,573) (4,322) Total property and equipment, net $ 2,589 $ 2,854 Depreciation and amortization expense for the three months ended June 30, 2023 and 2022 was $0.3 million, and for the six months ended June 30, 2023 and 2022 was $0.6 million.

Accrued Expenses and Other Curr

Accrued Expenses and Other Current Liabilities	6 Months Ended
Accrued Expenses and Other Current Liabilities	Jun. 30, 2023
Accrued Expenses and Other Current Liabilities
Accrued Expenses and Other Current Liabilities	5. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): June 30, December 31, 2023 2022 Employee compensation and benefits $ 2,842 $ 4,243 External research and development costs 585 817 Legal and professional fees 2,379 714 Interest on long-term debt — 195 Other 29 52 Total accrued expenses and other current liabilities $ 5,835 $ 6,021

Debt

Debt	6 Months Ended
Debt	Jun. 30, 2023
Debt
Debt	6. Debt The following discussion of the Company’s debt should be read in conjunction with Note 6 to the Notes to the Consolidated Financial Statements in the 2022 Form 10-K. As of December 31, 2022, long-term debt consisted of the following (in thousands): December 31, 2022 Principal amount of long-term debt $ 18,333 Less: Current portion of long-term debt (6,667) Long-term debt, net of current portion 11,666 Final debt payment liability 700 Debt discount, net of accretion (345) Long-term debt, net of discount and current portion $ 12,021 As of December 31, 2022, the interest rate applicable to borrowings under the loan and security agreement with Oxford Finance LLC (the “2020 Credit Facility”) was 12.4% and the Company was in full compliance with all financial covenants of the 2020 Credit Facility. On May 19, 2023, the Company voluntarily repaid all outstanding principal, accrued and unpaid interest, fees, costs and expenses, equal to $16.4 million in the aggregate (the “Payoff Amount”), under the 2020 Credit Facility. The Payoff Amount included a final payment charge of 3.5% of the original principal amount of the term loan that was funded. Upon receipt by the Oxford Finance LLC of the Payoff Amount on May 19, 2023, all obligations, covenants, debts and liabilities of the Company under the 2020 Credit Facility were satisfied and discharged in full, and the 2020 Credit Facility and all other obligations of the Company under the 2020 Credit Facility were terminated.

Stock Based Compensation

Stock Based Compensation	6 Months Ended
Stock Based Compensation	Jun. 30, 2023
Stock Based Compensation
Stock Based Compensation	7. Stock Based Compensation The Company uses stock options to provide long-term incentives to its employees, non-employee directors and certain consultants. The Company has two equity compensation plans under which awards are currently authorized for issuance: the 2020 Employee Stock Purchase Plan and the 2020 Equity Incentive Plan. The Company also has outstanding stock-based awards under its 2016 Equity Incentive Plan but is no longer granting awards under this plan. As of June 30, 2023, there were 126,557 shares available for issuance under the 2020 Equity Incentive Plan and 86,145 shares available for issuance under the 2020 Employee Stock Purchase Plan. The fair value of each option is estimated on the date of grant using the Black-Scholes option-pricing model. The Company was a private company prior to the initial public offering and lacked company-specific historical and implied volatility information for its stock. Therefore, it estimates its expected stock price volatility based on the historical volatility of a publicly traded set of peer companies and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded stock price. The expected term of the Company’s stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. The expected term of options granted to non-employees is equal to the contractual term of the option award. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The expected dividend yield of 0% is based on the fact that the Company has never paid cash dividends on common stock and does not expect to pay any cash dividends in the foreseeable future. The following table presents, on a weighted average basis, the assumptions used in the Black-Scholes option-pricing model to determine the grant-date fair value of stock options granted to employees and directors: Three months ended Six months ended June 30, June 30, 2023 2022 2023 2022 Risk-free interest rate 3.65 % 2.61 % 4.05 % 1.69 % Expected dividend yield 0.00 % 0.00 % 0.00 % 0.00 % Expected term (in years) 5.8 5.9 6.1 6.0 Expected volatility 98.02 % 83.87 % 95.14 % 84.25 % Stock Option Activity The following table summarizes the Company’s stock option activity since December 31, 2022: Weighted average Weighted remaining Aggregate Number of average contractual term intrinsic value options exercise price (in years) (in thousands) Balances at December 31, 2022 377,749 $ 86.19 7.8 $ — Options granted 140,529 14.00 Options cancelled (24,323) 47.96 Options exercised (188) 19.24 Outstanding and expected to vest at June 30, 2023 493,767 67.53 7.9 1,752 Exercisable at June 30, 2023 214,592 $ 91.88 6.4 $ 269 The aggregate intrinsic value of options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock for those options that had exercise prices lower than the fair value of the Company’s common stock. The aggregate intrinsic value of stock options exercised during the three and six months ended June 30, 2023 were less than $0.1 million. The aggregate intrinsic value of stock options exercised during the three and six months ended June 30, 2022 were $0 and $3.6 million, respectively. The weighted average grant date fair value of stock options during the three and six months ended June 30, 2023 and 2022 were $6.59, $11.18, $10.88 and $108.55 respectively. Restricted Stock Units The Company has granted restricted stock units with time-based vesting conditions to employees. The restricted stock units primarily vest over 3 years from the grant date. The Company values restricted stock units on the grant-date using the market price of the Company’s common stock. The following table summarizes restricted stock unit activity since December 31, 2022: Weighted average grant Shares date fair value Unvested shares as of December 31, 2022 11,563 $ 72.02 Forfeited (480) 73.45 Unvested shares as of June 30, 2023 11,083 $ 72.02 Stock-based Compensation Expense Stock-based compensation expense related to stock options and restricted stock units was classified in the statement of operations and comprehensive loss as follows (in thousands): Three months ended Six months ended June 30, June 30, 2023 2022 2023 2022 Research and development $ 530 $ 549 $ 962 $ 1,064 General and administrative 1,029 1,182 1,946 2,285 $ 1,559 $ 1,731 $ 2,908 $ 3,349 As of June 30, 2023, total unrecognized stock-based compensation expense related to unvested stock-based awards and units was $8.4 million, which is expected to be recognized over a weighted average period of 1.8 years. At-the-Market Offering On April 14, 2022, the Company entered into an Equity Distribution Agreement with Canaccord Genuity LLC, or Canaccord, pursuant to which the Company may issue and sell shares of common stock, from time to time, having an aggregate offering price of up to $10.0 million. Sales of common stock through Canaccord may be made by any method that is deemed an “at the market” offering as defined in Rule 415 promulgated under the Securities Act of 1933, as amended. The Company is not obligated to make any sales of its common stock under the Equity Distribution Agreement. Any sales under the Equity Distribution Agreement will be made pursuant to the registration statement on Form S-3 (File No 333- 264296), which became effective on April 22, 2022 and the prospectus relating to such offering. There were no sales under the Equity Distribution Agreement as of June 30, 2023.

License and Collaboration Agree

License and Collaboration Agreement	6 Months Ended
License and Collaboration Agreement	Jun. 30, 2023
License and Collaboration Agreement
License and Collaboration Agreement	8. License and Collaboration Agreement Lilly License and Collaboration Agreement On April 2, 2018, the Company entered into a License and Collaboration Agreement with Lilly (the “2018 Lilly Agreement”). Under the 2018 Lilly Agreement, the Company granted Lilly an exclusive worldwide, royalty-bearing license, including the right to grant sublicenses, to the Company’s encapsulation technology applied to islet cells. The Company is responsible for research and development activities, including supply and manufacturing activities, through investigational new drug (“IND”) filing readiness for the first product candidate, including costs up to $47.5 million and certain supply and manufacturing of products and materials in Phase 1 clinical trials and for clinical and commercial use following Phase 1 clinical trials; provided, however, that, pursuant to an amendment to the 2018 Lilly Agreement entered in May 2022, Lilly may take on certain research and development activities, at its own cost and expense, including supply and manufacturing activities. In addition, Lilly will be responsible for development and commercialization of any licensed product post-IND filing readiness and research and development costs for the IND product candidate above the $47.5 million cost threshold. Lilly is also responsible for all research, development and commercialization related to any subsequent product candidate. The parties are collaborating with the intent of developing encapsulated cell therapies for the potential treatment of type 1 diabetes. The activities under the agreement are governed by a joint research committee (“JRC”), which meets quarterly and consists of at least three members each from the Company and Lilly. Under the 2018 Lilly Agreement, Lilly was obligated to pay the Company a one-time, non-refundable and non-creditable license issuance fee of $62.5 million. Lilly is also obligated to make aggregate milestone payments to the Company of up to $165.0 million upon achievement of certain regulatory milestones for the first licensed product and regulatory milestones up to $160.0 million for additional licensed products. Lilly is also obligated to pay the company sales-based milestones of up to $250.0 million for each licensed product and tiered (from mid-single-to-low-double digit) sales-based royalties for each licensed product. The 2018 Lilly Agreement will expire upon the expiration of the last royalty term, on a product-by-product and country-for country basis. The royalty term, by product and country, commences upon the first commercial sale and ends upon the later to occur of (i) the expiration of the Company’s patent rights of a product candidate developed under the Lilly Agreement, (ii) the expiration of any data exclusivity period in a country or (iii) 10 years after the first commercial sale. The Company will have the right, and the obligation, to supply Lilly’s requirements for the material to be used in the manufacture of licensed products for clinical and commercial use. In connection with the supply responsibilities, the parties may enter into supply and quality agreements for both clinical and commercial supply. The Company evaluated the 2018 Lilly Agreement under ASC 606 as the transactions underlying the agreement were considered transactions with a customer. The Company identified the following material promises under the arrangement: (i) exclusive license to research, develop, manufacture and commercialize licensed products, (ii) initial technology transfer, (iii) research activities (including pre-IND supply), (iv) cell line development and supply, (v) product trademark election, (vi) requirement to supply Lilly with the licensed product related to Phase 1 clinical trial (“Phase 1 Supply”) and (vii) participation in the JRC. The Company determined that the exclusive license to research, develop, manufacture and commercialize the licensed product was not distinct from the related research and manufacturing activities to be provided by the Company as a result of Lilly being unable to benefit on its own or with other resources reasonably available in the marketplace because the license to the Company’s intellectual property requires significant specialized capabilities in order to be further developed, the research services necessary to develop the product are highly specialized and the Company’s proprietary technology is a key capability of that development. The cell line development and supply and research activities were determined not to be distinct because they are performed in conjunction with the research activities to further develop the underlying technology. The product trademark was determined not to be distinct because the benefit that Lilly receives from the Company’s trademark license only exists when combined with the right to commercialize the licensed product. In addition, the Company determined that the impact of the participation in the JRC was insignificant and had an immaterial impact on the accounting model. Therefore, the Company determined that the first five promises should be combined into a single performance obligation (the “Combined Performance Obligation”). The Company determined the sixth promise, the Phase 1 Supply promise, is distinct in the contract. As this is at no cost to Lilly, the right to receive this supply represents a material right and a distinct performance obligation. As such, the Company determined there were two distinct performance obligations at the outset of the 2018 Lilly Agreement. The Company determined that the $62.5 million upfront payment represents the entirety of the consideration to be included in the transaction price as of the outset of the arrangement. The potential milestone payments that the Company may have been eligible to receive were initially excluded from the transaction price at the outset of the arrangement because (i) all development and regulatory milestone payments did not meet the criteria for inclusion using the most-likely-amount method and (ii) the Company recognizes as revenue sales-based milestones and royalties when the related sales occur. As of June 30, 2023, no milestones or royalties have been deemed likely to be achieved or have been achieved. The Company recognizes revenue for the Combined Performance Obligation as the research, development and manufacturing services are provided using an input method, based on the cumulative costs incurred compared to the total estimated costs expected to be incurred to satisfy the Combined Performance Obligation. The transfer of control to the customer occurs over the time period that the research and development services are to be provided by the Company, and this cost-to-cost method is, in management’s judgement, the best measure of progress toward satisfying this performance obligation. The Company allocated $56.6 million of the transaction price to the Combined Performance Obligation at the outset of the arrangement. The Phase 1 Supply was determined to be a material right, and the standalone selling price was estimated using the expected cost-plus margin approach. The Company allocated $5.9 million of the transaction price to the Phase 1 Supply at the outset of the arrangement. The Company has determined that the Phase 1 Supply will be satisfied at a point in time when the customer obtains control of each unit of product. Therefore, the Company will recognize revenue as shipments of the Phase 1 Supply are made to Lilly. The Company reevaluates the transaction price and the total estimated costs expected to be incurred to satisfy the performance obligations at the end of each reporting period and as uncertain events, such as changes to the expected timing and cost of certain research, development and manufacturing activities that the Company is responsible for, are resolved or other changes in circumstances occur, and, if necessary, the Company will adjust its estimate of the transaction price and total estimated costs expected to be incurred. During the six months ended June 30, 2023, consistent with the Company’s presentation to the JRC, the Company revised its estimate of total costs to complete the activities under the 2018 Lilly Agreement to reflect the Company’s experiences to date and the impact this has on its expected future research and development activities to satisfy the Combined Performance Obligation. During the six months ended June 30, 2023, there has been an increase to the total estimated costs expected to be incurred of $6.8 million verse the estimate as of December 31, 2022. The increase in total estimated costs impacted both the Company’s estimated transaction price for the 2018 Lilly Agreement, as Lilly is obligated to reimburse the Company if the costs exceed $47.5 million to complete the services, which occurred in September 2022, and the Company’s input method used to recognize revenue, as this measure compares the Company’s cumulative costs incurred to the Company’s total estimated costs expected to be incurred. During the six months ended June 30, 2023, based on the allocation of total transaction price to each performance obligation using the relative stand-alone selling price of each performance obligation under the 2018 Lilly Agreement, the transaction price for the Combined Performance Obligation increased by $6.9 million and the Phase 1 supply performance obligation increased by $0.7 million. During the three and six months ended June 30, 2023 and 2022, the Company recognized $5.9 million, $2.9 million, $10.8 million and $6.0 million, respectively, of collaboration revenue. As of June 30, 2023 and December 31, 2022, the Company recorded as a contract liability deferred revenue of $13.8 million and $12.9 million, respectively, which were classified as current liabilities in the accompanying balance sheet. As of June 30, 2023 and December 31, 2022, the research and development services related to the Combined Performance Obligation were expected to be performed over a remaining period of approximately 1.5 years and 2.0 years, respectively. Contract Liability The changes in the total contract liability (deferred revenue) balances related to the Company’s license and collaboration agreements with Lilly were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Deferred revenues at beginning of period $ 12,987 $ 19,206 $ 12,885 $ 22,367 Revenues deferred during the period 6,692 — 11,652 — Revenues recognized during the period (5,900) (2,883) (10,758) (6,044) Deferred revenues at end of period $ 13,779 $ 16,323 $ 13,779 $ 16,323

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
Commitments and Contingencies	Jun. 30, 2023
Commitments and Contingencies
Commitments and Contingencies	9. Commitments and Contingencies Indemnification Agreements In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with members of its board of directors and certain of its executive officers that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. The Company has not incurred any material costs as a result of such indemnifications and is not currently aware of any indemnification claims. Legal Proceedings The Company is not a party to any material legal proceedings. At each reporting date, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. The Company expenses as incurred the costs related to such legal proceedings.

Net Loss per Share

Net Loss per Share	6 Months Ended
Net Loss per Share	Jun. 30, 2023
Net Loss per Share
Net Loss per Share	10. Net Loss per Share Basic and diluted net loss per share attributable to common stockholders was calculated as follows (in thousands, except share and per share amounts): Three Months Ended June 30 Six Months Ended June 30, 2023 2022 2023 2022 Numerator: Net loss $ (7,506) $ (14,346) $ (14,884) $ (28,205) Net loss attributable to common stockholders $ (7,506) $ (14,346) $ (14,884) $ (28,205) Denominator: Weighted average common stock outstanding—basic and diluted 2,501,900 2,492,251 2,499,701 2,490,779 Net loss per share attributable to common stockholders—basic and diluted $ (3.00) $ (5.76) $ (5.95) $ (11.32) The Company’s potential dilutive securities have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share. Therefore, the weighted-average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to common stockholders is the same. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Warrants to purchase common stock 1,464 1,464 1,464 1,464 Unvested restricted stock units 11,083 15,223 11,083 17,069 Stock options to purchase common stock 493,767 386,957 493,767 312,157 506,314 403,644 506,314 330,690

Related Party Transactions

Related Party Transactions	6 Months Ended
Related Party Transactions	Jun. 30, 2023
Related Party Transactions
Related Party Transactions	11. Related Party Transactions As described in Note 8 above, the Company entered into the 2018 Lilly Agreement with Lilly in April 2018. During the three and six months ended June, 2023 and 2022, the Company recognized $5.9 million, $2.9 million, $10.8 million and $6.0 million, respectively, of related party revenue associated with Lilly collaboration agreements. As of June 30, 2023 and December 31, 2022, the Company had deferred revenue related to the collaboration agreements with Lilly of $13.8 million and $12.9 million, respectively. As of June 30, 2023 and December 31, 2022, the Company had $4.5 million and $2.2 million of outstanding receivables with Lilly. Further, as of June 30, 2023 and December 31, 2022, the Company had $2.4 million and $1.3 million of unbilled receivables with Lilly. On February 1, 2022, the Company entered into a shared space arrangement with a portfolio company of Flagship Pioneering, to sublease a portion of its office and laboratory space in Cambridge, Massachusetts. The term of the shared space arrangement commenced on February 1, 2022 and continues for an initial term ending on July 31, 2023. The agreement may be renewed for six successive one-month periods. The Company will be paid a fee based on the portfolio company’s occupancy of the office and laboratory space. Under this agreement, the Company recorded other income, net, of less than $0.1 million during the six months ended June 30, 2023, respectively. The Company received $1.8 million of cash payments during the six months ended June 30, 2023, and as of June 30, 2023, the Company had $0.3 million of outstanding receivables under this agreement. On June 28, 2023, the Company entered into the Merger Agreement, among the Company, Lilly and Purchaser. For additional information related to the Merger Agreement, refer to Note 1 above.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	6 Months Ended
Summary of Significant Accounting Policies (Policies)	Jun. 30, 2023
Summary of Significant Accounting Policies
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. Estimates and assumptions reflected in these financial statements include, but are not limited to, revenue recognition, research and development expenses and stock-based awards. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results may differ from those estimates or assumptions.
Concentration of Credit Risk and of Significant Suppliers	Concentration of Credit Risk and of Significant Suppliers The financial instruments that potentially subject the Company to concentrations of credit risk are cash and accounts receivable. The Company does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. As of June 30, 2023 and December 31, 2022, 100% of the Company’s receivables were related to the Company’s collaboration agreements with Eli Lilly and Company (Note 8). The Company is dependent on third-party manufacturers to supply certain products for research and development activities in its programs. The Company currently has a supplier of certain raw materials that would be considered a sole supplier. If the Company cannot access additional suppliers or secure sufficient inventory of these raw materials, its programs could be adversely affected by an interruption in the availability of these raw materials.
Net Income (Loss) per Share	Net Income (Loss) per Share The Company only has one class of shares outstanding and basic net income (loss) per common share is computed by dividing the net income (loss) by the weighted average number of shares of common stock outstanding for the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding for the period, including potential dilutive common shares assuming the dilutive effect of outstanding stock awards. For periods in which the Company reports a net loss, diluted net loss per common share is the same as basic net loss per common share, since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.

Fair Value Measurements and m_2

Fair Value Measurements and marketable securities (Tables)	6 Months Ended
Fair Value Measurements and marketable securities (Tables)	Jun. 30, 2023
Fair Value Measurements and marketable securities
Schedule of financial assets and liabilities measured at fair value on a recurring basis	The following table summarizes the Company’s cash equivalents and marketable securities as of June 30, 2023 and December 31, 2022 (in thousands): Fair value measurements as of June 30, 2023 Level 1 Level 2 Level 3 Total Cash equivalents Money market funds $ 13,437 $ — $ — $ 13,437 U.S. Treasuries — 2,969 — 2,969 Total cash equivalents 13,437 2,969 — 16,406 Marketable securities Corporate bonds — 8,332 — 8,332 U.S. Treasuries — 6,947 — 6,947 Total marketable securities — 15,279 — 15,279 Total $ 13,437 $ 18,248 $ — $ 31,685 Fair value measurements as of December 31, 2022 Level 1 Level 2 Level 3 Total Cash equivalents Money market funds $ 29,310 $ — $ — $ 29,310 Commercial paper — 1,994 — 1,994 U.S. Government Agencies — 4,999 — 4,999 Total cash equivalents 29,310 6,993 — 36,303 Marketable securities Corporate bonds — 21,594 — 21,594 Commercial paper — 1,738 — 1,738 U.S. Government Agencies — 1,235 — 1,235 U.S. Treasuries — 2,993 — 2,993 Total marketable securities — 27,560 — 27,560 Total $ 29,310 $ 34,553 $ — $ 63,863
Schedule of marketable securities	The following tables summarizes the Company’s available-for-sale marketable debt securities as of June 30, 2023 and December 31, 2022 (in thousands): Fair value measurements as of June 30, 2023 Gross Gross Amortized Unrealized Unrealized Credit Cost Gains Losses Losses Total Corporate bonds $ 8,507 $ — $ (175) $ — $ 8,332 U.S. Treasuries 6,948 — (1) — 6,947 Total $ 15,455 $ — $ (176) $ — $ 15,279 Fair value measurements as of December 31, 2022 Gross Gross Amortized Unrealized Unrealized Credit Cost Gains Losses Losses Total Corporate bonds $ 21,994 $ — $ (400) $ — $ 21,594 Commercial paper 1,743 — (5) — 1,738 U.S. Government Agencies 1,248 — (13) — 1,235 U.S. Treasuries 2,999 — (6) — 2,993 Total $ 27,984 $ — $ (424) $ — $ 27,560
Schedule of available-for-sale marketable debt securities by contractual maturity	The following table summarizes the Company’s available-for-sale marketable debt securities by contractual maturity as of June 30, 2023 and December 31, 2022 (in thousands): June 30, December 31, 2023 2022 Maturities in one year or less $ 7,436 $ 23,231 Maturities between one and two years 7,843 4,329 Total $ 15,279 $ 27,560

Property and Equipment, Net (Ta

Property and Equipment, Net (Tables)	6 Months Ended
Property and Equipment, Net (Tables)	Jun. 30, 2023
Property and Equipment, Net
Schedule of property and equipment, net	Property and equipment, net consisted of the following (in thousands): June 30, December 31, 2023 2022 Laboratory equipment $ 6,191 $ 6,301 Leasehold improvements 78 78 Furniture and fixtures 620 620 Computers and software 273 177 7,162 7,176 Less: Accumulated depreciation and amortization (4,573) (4,322) Total property and equipment, net $ 2,589 $ 2,854

Accrued Expenses and Other Cu_2

Accrued Expenses and Other Current Liabilities (Tables)	6 Months Ended
Accrued Expenses and Other Current Liabilities (Tables)	Jun. 30, 2023
Accrued Expenses and Other Current Liabilities
Schedule of accrued expenses and other current liabilities	Accrued expenses and other current liabilities consisted of the following (in thousands): June 30, December 31, 2023 2022 Employee compensation and benefits $ 2,842 $ 4,243 External research and development costs 585 817 Legal and professional fees 2,379 714 Interest on long-term debt — 195 Other 29 52 Total accrued expenses and other current liabilities $ 5,835 $ 6,021

Debt (Tables)

Debt (Tables)	6 Months Ended
Debt (Tables)	Jun. 30, 2023
Debt
Schedule of long-term debt	As of December 31, 2022, long-term debt consisted of the following (in thousands): December 31, 2022 Principal amount of long-term debt $ 18,333 Less: Current portion of long-term debt (6,667) Long-term debt, net of current portion 11,666 Final debt payment liability 700 Debt discount, net of accretion (345) Long-term debt, net of discount and current portion $ 12,021

Stock Based Compensation (Table

Stock Based Compensation (Tables)	6 Months Ended
Stock Based Compensation (Tables)	Jun. 30, 2023
Stock Based Compensation
Schedule of weighted average assumption for grant date fair value of stock options	Three months ended Six months ended June 30, June 30, 2023 2022 2023 2022 Risk-free interest rate 3.65 % 2.61 % 4.05 % 1.69 % Expected dividend yield 0.00 % 0.00 % 0.00 % 0.00 % Expected term (in years) 5.8 5.9 6.1 6.0 Expected volatility 98.02 % 83.87 % 95.14 % 84.25 %
Schedule of stock option activity	Weighted average Weighted remaining Aggregate Number of average contractual term intrinsic value options exercise price (in years) (in thousands) Balances at December 31, 2022 377,749 $ 86.19 7.8 $ — Options granted 140,529 14.00 Options cancelled (24,323) 47.96 Options exercised (188) 19.24 Outstanding and expected to vest at June 30, 2023 493,767 67.53 7.9 1,752 Exercisable at June 30, 2023 214,592 $ 91.88 6.4 $ 269
Schedule of restricted stock activity	Weighted average grant Shares date fair value Unvested shares as of December 31, 2022 11,563 $ 72.02 Forfeited (480) 73.45 Unvested shares as of June 30, 2023 11,083 $ 72.02
Schedule of stock-based compensation expense	Stock-based compensation expense related to stock options and restricted stock units was classified in the statement of operations and comprehensive loss as follows (in thousands): Three months ended Six months ended June 30, June 30, 2023 2022 2023 2022 Research and development $ 530 $ 549 $ 962 $ 1,064 General and administrative 1,029 1,182 1,946 2,285 $ 1,559 $ 1,731 $ 2,908 $ 3,349

License and Collaboration Agr_2

License and Collaboration Agreement (Tables)	6 Months Ended
License and Collaboration Agreement (Tables)	Jun. 30, 2023
Lilly License and Collaboration Agreement
License and Collaboration Agreement
Schedule of the changes in the total contract liability (deferred revenue) balances related to the Company's license and collaboration agreements	The changes in the total contract liability (deferred revenue) balances related to the Company’s license and collaboration agreements with Lilly were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Deferred revenues at beginning of period $ 12,987 $ 19,206 $ 12,885 $ 22,367 Revenues deferred during the period 6,692 — 11,652 — Revenues recognized during the period (5,900) (2,883) (10,758) (6,044) Deferred revenues at end of period $ 13,779 $ 16,323 $ 13,779 $ 16,323

Net Loss per Share (Tables)

Net Loss per Share (Tables)	6 Months Ended
Net Loss per Share (Tables)	Jun. 30, 2023
Net Loss per Share
Schedule of Basic and diluted net loss per share attributable to common stockholders	Basic and diluted net loss per share attributable to common stockholders was calculated as follows (in thousands, except share and per share amounts): Three Months Ended June 30 Six Months Ended June 30, 2023 2022 2023 2022 Numerator: Net loss $ (7,506) $ (14,346) $ (14,884) $ (28,205) Net loss attributable to common stockholders $ (7,506) $ (14,346) $ (14,884) $ (28,205) Denominator: Weighted average common stock outstanding—basic and diluted 2,501,900 2,492,251 2,499,701 2,490,779 Net loss per share attributable to common stockholders—basic and diluted $ (3.00) $ (5.76) $ (5.95) $ (11.32)
Schedule of potential dilutive securities excluded from the computation of diluted net loss per share	Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Warrants to purchase common stock 1,464 1,464 1,464 1,464 Unvested restricted stock units 11,083 15,223 11,083 17,069 Stock options to purchase common stock 493,767 386,957 493,767 312,157 506,314 403,644 506,314 330,690

Nature of the Business and Ba_2

Nature of the Business and Basis of Presentation (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended		12 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Nature of the Business and Basis of Presentation
Net loss	$ 7,506	$ 7,378	$ 14,346	$ 13,859	$ 14,884	$ 28,205	$ 43,600
Accumulated deficit	271,684				271,684		$ 256,800
Cash, cash equivalents and marketable securities	$ 34,900				$ 34,900

Nature of the Business and Ba_3

Nature of the Business and Basis of Presentation - Proposed Acquisition by Eli Lilly and Company (Details) $ / shares in Units, $ in Millions	Jun. 30, 2023 USD ($) $ / shares	Jun. 28, 2023 item $ / shares	Dec. 31, 2022 $ / shares
Business Acquisition
Common stock par value	$ 0.001		$ 0.001
Merger with Eli Lilly and company
Business Acquisition
Termination fee payable \| $	$ 1.3
Sigilon Therapeutics
Business Acquisition
Common stock par value		$ 0.001
Lilly \| Sigilon Therapeutics
Business Acquisition
Business acquisition, share price		$ 14.92
Number of contingent value \| item		1
Lilly \| Sigilon Therapeutics \| Maximum
Business Acquisition
Number of contingent payments \| item		3
Contingent value right as at the date of acquisition		$ 111.64

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Details)	6 Months Ended	12 Months Ended
Summary of Significant Accounting Policies (Details)	Jun. 30, 2023	Dec. 31, 2022
Accounts receivable \| Customer Concentration Risk \| Lilly
Summary of Significant Accounting Policies
Concentrations of credit risk	100%	100%

Fair Value Measurements and m_3

Fair Value Measurements and marketable securities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Fair Value Measurements
In to level 2	$ 0
Out of level 2	0
Recurring
Fair Value Measurements
Total cash equivalents	16,406	$ 36,303
Total marketable securities	15,279	27,560
Total	31,685	63,863
Recurring \| Money market funds
Fair Value Measurements
Total cash equivalents	13,437	29,310
Recurring \| Commercial paper
Fair Value Measurements
Total cash equivalents		1,994
Total marketable securities		1,738
Recurring \| Corporate bonds
Fair Value Measurements
Total marketable securities	8,332	21,594
Recurring \| U.S. Government Agencies
Fair Value Measurements
Total cash equivalents		4,999
Total marketable securities		1,235
Recurring \| U.S. Treasuries
Fair Value Measurements
Total cash equivalents	2,969
Total marketable securities	6,947	2,993
Recurring \| Level 1
Fair Value Measurements
Total cash equivalents	13,437	29,310
Total	13,437	29,310
Recurring \| Level 1 \| Money market funds
Fair Value Measurements
Total cash equivalents	13,437	29,310
Recurring \| Level 2
Fair Value Measurements
Total cash equivalents	2,969	6,993
Total marketable securities	15,279	27,560
Total	18,248	34,553
Recurring \| Level 2 \| Commercial paper
Fair Value Measurements
Total cash equivalents		1,994
Total marketable securities		1,738
Recurring \| Level 2 \| Corporate bonds
Fair Value Measurements
Total marketable securities	8,332	21,594
Recurring \| Level 2 \| U.S. Government Agencies
Fair Value Measurements
Total cash equivalents		4,999
Total marketable securities		1,235
Recurring \| Level 2 \| U.S. Treasuries
Fair Value Measurements
Total cash equivalents	2,969
Total marketable securities	$ 6,947	$ 2,993

Fair Value Measurements and m_4

Fair Value Measurements and marketable securities - Available for sale marketable debt Securities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Marketable Securities
Amortized Cost	$ 15,455	$ 27,984
Gross Unrealized Losses	(176)	(424)
Total	15,279	27,560
Corporate bonds
Marketable Securities
Amortized Cost	8,507	21,994
Gross Unrealized Losses	(175)	(400)
Total	8,332	21,594
Commercial paper
Marketable Securities
Amortized Cost		1,743
Gross Unrealized Losses		(5)
Total		1,738
U.S. Treasuries
Marketable Securities
Amortized Cost	6,948	2,999
Gross Unrealized Losses	(1)	(6)
Total	$ 6,947	2,993
U.S. Government Agencies
Marketable Securities
Amortized Cost		1,248
Gross Unrealized Losses		(13)
Total		$ 1,235

Fair Value Measurements and m_5

Fair Value Measurements and marketable securities - Available-for-sale marketable debt securities by contractual maturity (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
available-for-sale marketable debt securities contractual maturity
Maturities in one year or less	$ 7,436	$ 23,231
Maturities between one and two years	7,843	4,329
Total	$ 15,279	$ 27,560

Property and Equipment, Net (De

Property and Equipment, Net (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Property and Equipment, Net
Property and equipment, gross	$ 7,162		$ 7,162		$ 7,176
Less: Accumulated depreciation and amortization	(4,573)		(4,573)		(4,322)
Total property and equipment, net	2,589		2,589		2,854
Depreciation and amortization expense	300	$ 300	625	$ 633
Laboratory equipment
Property and Equipment, Net
Property and equipment, gross	6,191		6,191		6,301
Leasehold improvements
Property and Equipment, Net
Property and equipment, gross	78		78		78
Furniture and fixtures
Property and Equipment, Net
Property and equipment, gross	620		620		620
Computers and software
Property and Equipment, Net
Property and equipment, gross	$ 273		$ 273		$ 177

Accrued Expenses and Other Cu_3

Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Accrued Expenses and Other Current Liabilities
Employee compensation and benefits	$ 2,842	$ 4,243
External research and development costs	585	817
Legal and professional fees	2,379	714
Interest on long-term debt		195
Other	29	52
Total accrued expenses and other current liabilities	$ 5,835	$ 6,021

Debt (Details)

Debt (Details) $ in Thousands	Dec. 31, 2022 USD ($)
Debt
Principal amount of long-term debt	$ 18,333
Less: Current portion of long-term debt	(6,667)
Longterm debt, net of current portion	11,666
Final debt payment liability	700
Debt discount, net of accretion	(345)
Longterm debt, net of discount and current portion	$ 12,021

Debt - Narrative (Details)

Debt - Narrative (Details) - USD ($) $ in Thousands		6 Months Ended
Debt - Narrative (Details) - USD ($) $ in Thousands	May 19, 2023	Jun. 30, 2023	Dec. 31, 2022
Debt
Repayment of debt		$ 19,040
Term loan
Debt
Repayment of debt	$ 16,400
Percentage of final payment charge on original principal amount of debt	3.50%
2020 Credit Facility
Debt
Effective interest rate (as a percent)			12.40%

Stock Based Compensation - Equi

Stock Based Compensation - Equity Incentive Plans (Details)	6 Months Ended
Stock Based Compensation - Equity Incentive Plans (Details)	Jun. 30, 2023 plan shares
Stock Based Compensation
Number of equity compensation plans \| plan	2
2020 Employee Stock Purchase Plan And 2020 Equity Incentive Plan
Stock Based Compensation
Expected dividend yield	0%
2020 Employee Stock Purchase Plan
Stock Based Compensation
Number of shares available for grant	86,145
2020 Equity Incentive Plan
Stock Based Compensation
Number of shares available for grant	126,557

Stock Based Compensation - Stoc

Stock Based Compensation - Stock Option Valuation (Details) - Employees and directors	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Assumptions used
Risk free interest rate	3.65%	2.61%	4.05%	1.69%
Expected dividend yield	0%	0%	0%	0%
Expected term (in years)	5 years 9 months 18 days	5 years 10 months 24 days	6 years 1 month 6 days	6 years
Expected volatility	98.02%	83.87%	95.14%	84.25%

Stock Based Compensation - St_2

Stock Based Compensation - Stock Option activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Number of options
Beginning balances			377,749
Options granted			140,529
Options cancelled			(24,323)
Options exercised			(188)
Ending balances	493,767		493,767		377,749
Exercisable	214,592		214,592
Weighted average exercise price
Beginning balances			$ 86.19
Options granted			14
Options cancelled			47.96
Options exercised			19.24
Ending balances	$ 67.53		67.53		$ 86.19
Exercisable	$ 91.88		$ 91.88
Weighted average remaining contractual term
Weighted average remaining contractual term (in years)			7 years 10 months 24 days		7 years 9 months 18 days
Exercisable			6 years 4 months 24 days
Aggregate intrinsic value
Exercisable	$ 269		$ 269
Ending balances	$ 1,752		1,752
Aggregate intrinsic value of stock options exercised		$ 0	$ 100	$ 3,600
Weighted average grant date fair value of stock options (in dollars per share)	$ 6.59	$ 10.88	$ 11.18	$ 108.55

Stock Based Compensation - Rest

Stock Based Compensation - Restricted Stock Units (Details) - Restricted Stock Units	6 Months Ended
	Jun. 30, 2023 $ / shares shares
Stock Based Compensation
Vesting period	3 years
Shares
Unvested shares beginning balance \| shares	11,563
Unvested shares, Forfeited \| shares	(480)
Unvested shares ending balance \| shares	11,083
Weighted average grant date fair value
Weighted average grant date fair value, beginning balance \| $ / shares	$ 72.02
Weighted average grant date fair value, forfeited \| $ / shares	73.45
Weighted average grant date fair value, ending balance \| $ / shares	$ 72.02

Stock Based Compensation - St_3

Stock Based Compensation - Stock Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Stock Based Compensation
Stock based compensation	$ 1,559	$ 1,731	$ 2,908	$ 3,349
Unrecognized stock-based compensation expense	8,400		$ 8,400
Period of unrecognized stock-based compensation expense			1 year 9 months 18 days
Research and development
Stock Based Compensation
Stock based compensation	530	549	$ 962	1,064
General and administrative
Stock Based Compensation
Stock based compensation	$ 1,029	$ 1,182	$ 1,946	$ 2,285

Stock Based Compensation - At-t

Stock Based Compensation - At-the-Market Offering (Details) $ in Millions	Apr. 14, 2022 USD ($)
At the market offering
Common Stock
Maximum amount of shares offered	$ 10

License and Collaboration Agr_3

License and Collaboration Agreement - Lilly License and Collaboration Agreement (Details) $ in Thousands		3 Months Ended		6 Months Ended		12 Months Ended
	Apr. 02, 2018 USD ($) item	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)	Mar. 31, 2023 USD ($)	Mar. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
License and Collaboration Agreement
Collaboration revenue		$ 5,900	$ 2,883	$ 10,758	$ 6,048
Current liabilities		25,247		25,247		$ 30,994
Lilly License and Collaboration Agreement
License and Collaboration Agreement
Amount of research and development costs the Company is responsible to cover	$ 47,500
Threshold amount of research and development costs above which the collaboration partner is responsible for	$ 47,500			47,500
Minimum number of members from the Company and partner on joint research committee \| item	3
Non-refundable, non-creditable upfront payment received	$ 62,500
Sales based milestone payments receivable	$ 250,000
Term of the license and collaboration agreement	10 years
Upfront payment	$ 62,500
Allocation of transaction price to combined performance obligation	56,600			6,900
Allocation of transaction price to Phase I supply	5,900			700
Increase in total estimated costs expected to be incurred				6,800
Collaboration revenue		5,900	10,800	2,900	6,000
Contract with customer liability, deferred revenue		$ 13,779	$ 16,323	$ 13,779	$ 16,323	$ 12,885	$ 12,987	$ 19,206	$ 22,367
Research and development services performance obligation period				1 year 6 months		2 years
Lilly License and Collaboration Agreement \| First Licensed Product
License and Collaboration Agreement
Maximum payments to be received from collaboration partner if milestones are met	165,000
Lilly License and Collaboration Agreement \| Additional Licensed Product
License and Collaboration Agreement
Maximum payments to be received from collaboration partner if milestones are met	$ 160,000

License and Collaboration Agr_4

License and Collaboration Agreement - Contract Liability (Details) - Lilly License and Collaboration Agreement - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
License and Collaboration Agreement
Deferred revenues at beginning of period	$ 12,987	$ 19,206	$ 12,885	$ 22,367
Revenues deferred during the period	6,692		11,652
Revenues recognized during the period	(5,900)	(2,883)	(10,758)	(6,044)
Deferred revenues at end of period	$ 13,779	$ 16,323	$ 13,779	$ 16,323

Net Loss per Share - Basic and

Net Loss per Share - Basic and diluted net loss per share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				6 Months Ended		12 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Numerator:
Net loss	$ (7,506)	$ (7,378)	$ (14,346)	$ (13,859)	$ (14,884)	$ (28,205)	$ (43,600)
Net loss attributable to common stockholders	$ (7,506)		$ (14,346)		$ (14,884)	$ (28,205)
Denominator:
Weighted average common stock outstanding-basic (in shares)	2,501,900		2,492,251		2,499,701	2,490,779
Weighted average common stock outstanding-diluted (in shares)	2,501,900		2,492,251		2,499,701	2,490,779
Net loss per share attributable to common stockholders-basic (in dollars per share)	$ (3)		$ (5.76)		$ (5.95)	$ (11.32)
Net loss per share attributable to common stockholders-diluted (in dollars per share)	$ (3)		$ (5.76)		$ (5.95)	$ (11.32)

Net Loss per Share - Potential

Net Loss per Share - Potential dilutive securities excluded from the computation of diluted net loss per share (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Sep. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Net Loss per Share
Warrants to purchase common stock	1,464	1,464	1,464	1,464
Unvested restricted stock units	11,083	15,223	11,083	17,069
Stock options to purchase common stock	493,767	386,957	493,767	312,157
Total	506,314	403,644	506,314	330,690

Related Party Transactions (Det

Related Party Transactions (Details) $ in Millions		3 Months Ended		6 Months Ended
Related Party Transactions (Details) $ in Millions	Feb. 01, 2022 item	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Flagship Pioneering Inc. \| Shared Space Agreement
Related Party Transactions
Accounts receivable from related party		$ 0.3		$ 0.3
Cash payments received				1.8
Number of successive periods for renewal of sublease \| item	6
Sublease renewal term	1 month
Flagship Pioneering Inc. \| Shared Space Agreement \| Maximum
Related Party Transactions
Other income				0.1
Lilly \| Lilly License and Collaboration Agreement
Related Party Transactions
Revenue from related party		5.9	$ 10.8	2.9	$ 6
Deferred revenue from related party		13.8		13.8		$ 12.9
Accounts receivable from related party		4.5		4.5		2.2
Unbilled accounts receivable from related party		$ 2.4		$ 2.4		$ 1.3