The Company leases office space under operating leases that expire at various dates through 2037. The Company has elected the package of practical expedients under the transition guidance of ASC Topic 842, Leases, to exclude short-term leases from the balance sheet and to combine lease and non-lease components.

Upon inception of a lease, the Company determines if an arrangement is a lease, if it includes options to extend or terminate the lease, and if it is reasonably certain that the Company will exercise the options. Lease cost, representing lease payments over the term of the lease and any capitalizable direct costs less any incentives received, is recognized on a straight-line basis over the lease term as lease expense.

In determining the present value of lease payments, the Company uses its incremental borrowing rate based on the information available at the lease commencement date if the rate implicit in the lease is not readily determinable. Upon execution of a new lease, the Company performs an analysis to determine its incremental borrowing rate using its current borrowing rate, adjusted for various factors including level of collateralization and lease term. As of June 30, 2023, the remaining weighted average lease term was 12 years.

During the six months ended June 30, 2023, right-of-use assets increased by $6,333 due to the accounting commencement of two new leases in Hyderabad, India and by $2,569 due to contingency resolutions associated with the Company’s New York and San Diego office leases. During the six months ended June 30, 2023, lease liabilities increased by $6,333 due to the accounting commencement of the new leases.

On August 15, 2022, the Company entered into an office lease agreement for 17,500 square feet of office space in Framingham, Massachusetts. Under the terms of the agreement, the Company is obligated to pay base rent of approximately $114 per month with a 2% annual rental escalation each year. The Company estimates that the lease commencement date will occur during the three months ending September 30, 2023 and continue to the end of the lease, which is ten years after commencement.

On June 11, 2023, the Company entered into a three-year equipment lease agreement in its Framingham, Massachusetts laboratory. Under the terms of the agreement, the Company is obligated to make lease payments of approximately $6 per month for the first 12 months and $11 per month for the following 24 months of the agreement. The Company estimates that the lease commencement date will occur during the three months ending September 30, 2023 and continue to the end of the lease, which is three years after commencement.

Variable and short-term lease costs were immaterial for the six months ended June 30, 2023. Additional details of the Company’s operating leases are presented in the following table:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Operating lease costs	$	4,131	$	2,830	$	7,926	$	5,290

Cash paid for operating leases	2,923		752		5,560		1,301

Maturities of operating lease liabilities as of June 30, 2023 under noncancelable operating leases were as follows:


Year ending December 31:
Remainder of 2023	$	6,632
2024	15,926
2025	16,130
2026	15,820
2027	14,688
Thereafter	120,052
Total future minimum lease payments	189,249
Less: imputed interest	(68,009)
Present value of future minimum lease payments	121,240
Less: current portion of operating leases payments	(13,921)
Lease liabilities, long-term	$	107,319

From time to time, the Company may become involved in routine litigation arising in the ordinary course of business. While the results of such litigation cannot be predicted with certainty, management believes that the final outcome of such matters is not likely to have a material adverse effect on the Company’s financial position or results of operations or cash flows.

The Company is currently under audit with a royalty partner. As of June 30, 2023, the Company believes a contingency is probable, but not estimable.