Warrant Liabilities

12 Months Ended

Dec. 31, 2020

Warrants And Rights Note Disclosure [Abstract]

Warrant Liabilities

11. Warrant Liabilities

In connection with the Company’s November 2019 public offering of the Series A Preferred Stock, the Company issued Series A warrants to purchase up to 7,802,241 shares of common stock at an exercise price equal to $13.20, and Series B warrants to purchase up to 2,574,727 shares of common stock at an exercise price equal to $13.20. Both Series A and Series B warrants are exercisable following stockholder approval in January 2020 of an increase in authorized common stock sufficient to allow for the exercise of the warrants, subject to certain beneficial ownership limitations. The Series A warrants will expire five years from the date they first became exercisable or on January 22, 2025 and contain a cash and/or cashless exercise provision. The Series B warrants will expire on the 75^th day anniversary following the announcement of top-line data from the Company’s MOMENTUM Phase 3 clinical trial of momelotinib and may only be exercised by paying the exercise price in cash, which would amount to approximately $34.0 million in proceeds to the Company if fully exercised.

The Company revalued the warrant liabilities using the Black-Scholes option pricing model until they ceased to be derivative instruments, following stockholder approval of an increase in authorized common stock sufficient to allow for the exercise of the warrants, at which time they were reclassified to equity. The fair values of the Series A and Series B warrants at the time of issuance in November 2019, at December 31, 2019 and at the time they ceased to be derivative instruments in January 2020 were estimated to be $25.0 million, $45.9 million and $62.1 million, respectively. The Company recorded a $16.2 million and $20.9 million non-cash expense relating to the change in fair value of warrant liabilities in other income (expense), net in the accompanying consolidated statement of operations for the periods ended December 31, 2020 and 2019, respectively. (see Note 4).