Debt

12 Months Ended

Dec. 31, 2022

Debt Disclosure [Abstract]

Debt

5. Debt

Secured Term Loan Facility

On March 10, 2021, the Company executed the Loan and Security Agreement with Hercules Capital as agent for its affiliates serving as lenders thereunder (the “Term Loan”) which provided a loan in the aggregate principal amount of up to $80.0 million, in three tranches. On March 29, 2021, the Company drew the initial $25.0 million tranche under the Term Loan. After giving effect to payment of fees and expenses associated with the draw, the Company received net proceeds of approximately $24.4 million. The Term Loan bore interest at a floating rate equal to the greater of either (i) 8.75% plus the prime rate as reported in The Wall Street Journal minus 3.25%, or (ii) 8.75%. The Company was initially obligated to make monthly payments of accrued interest under the Term Loan commencing on the initial borrowing date and continuing to April 1, 2023, followed by monthly installments of principal and interest until March 1, 2025. In July 2022, the Company prepaid $25.0 million of outstanding principal, together with approximately $1.7 million of accrued interest, fees and other amounts, due under the Term Loan. In connection with the prepayment, the Term Loan with Hercules was terminated, and all obligations, liens and security interests under the Term Loan were released, discharged and satisfied. By retiring the Term Loan, the Company reduced future cash payments for interest and enhanced its ability to generate additional liquidity from its intellectual property by removing the loan’s collateral requirements. 

Interest expense related to the Term Loan, for the years ended December 31, 2022 and 2021 was approximately $2.9 million and $2.3 million, respectively, and the effective interest rate was 9.3% and 9.0%, respectively. Interest expense in the year ended December 31, 2022 included $1.2 million in unamortized loan fees recognized in connection with the loan payoff.