Leases

3 Months Ended

Mar. 31, 2022

Leases

Leases

7. Leases

Effective January 1, 2022, the Company adopted ASC Topic (ASC 842) using the modified retrospective approach by applying the new standard to all leases existing on the adoption date. The results for reporting periods beginning after January 1, 2022 are presented in accordance with ASC 842, while prior period amounts are not adjusted and continue to be reported under the accounting standards that were in effect prior to January 1, 2022.

In May 2017, the Company entered into a 62-month office and laboratory space lease commencing on July 1, 2017 for approximately 11,000 square feet of space in Exton, Pennsylvania. The Company has an option to extend the lease for up to two additional five-year terms. In December 2021, the Company extended the lease for an additional eighteen-month term ending in March 2024.

Beginning July 2021, the Company leased laboratory equipment on a month-to-month basis. In April 2022, the Company exercised the purchase option under the lease agreement to purchase the leased laboratory equipment. The Company elected the practical expedient to recognize short-term leases under ASC 840.

Supplemental balance sheet information related to leases as of March 31, 2022 was as follows (in thousands):

Operating leases:
Operating lease right-of-use assets	$	190
Operating lease liability	$	46
Operating lease liability, net of current portion		147
Total operating lease liability	$	193

Operating lease liability and operating lease liability, net of current portion is included in accrued expenses and other current liabilities and other long-term liabilities, respectively, in the accompanying condensed balance sheet.

Supplemental lease expense related to leases was as follows:

Lease Cost (in thousands)	Statements of Operations Classification		Three Months Ended March 31, 2022
Operating lease cost	General and administrative Research and development	$	60
Short-term lease cost	General and administrative Research and development		53
Total lease expense		$	113

Under ASC 840, rent expense for the three months ended March 31, 2021 was approximately $0.1 million.

Other information related to the operating lease where the Company is the lessee was as follows:

	Three Months Ended March 31, 2022
Weighted-average remaining lease term	2.0 years
Weighted-average discount rate	9.0%

Supplemental cash flow information related to the operating lease was as follows (in thousands):

		Three Months Ended March 31, 2022
Cash paid for operating lease liability	$	57

As of March 31, 2022, minimum rental commitments under the operating lease were as follows (in thousands):

Years ending December 31,	Amount
2022 (represents remaining nine months in 2022)	$	177
2023		246
2024		63
Total lease payments		486
Less imputed interest		(293)
Present value of lease liability	$	193