Subsequent Event

9 Months Ended

Sep. 30, 2017

Subsequent Events [Abstract]

Subsequent Event

9. Subsequent Event

In October 2017, the Board of Directors of the Company approved a plan of termination to eliminate a number of positions effective October 20, 2017 (the “Restructuring Plan”), as part of its commitment to reduce costs following the failure of the Phase 3 VELOCITY trial of somavaratan to reach its primary endpoint. The reduction included 45 employees, which represented approximately 62% of its workforce as of October 6, 2017. Affected employees were notified of the Restructuring Plan on October 6, 2017.  

Pursuant to the Restructuring Plan, affected employees received certain severance benefits. As a result of the Restructuring Plan, the Company incurred a one-time severance-related charge totaling approximately $3.4 million which will be recorded in the fourth quarter of 2017. The Company may also incur other charges or cash expenditures not currently contemplated due to events that may occur as a result of, or associated with, the Restructuring Plan.

Simultaneously with the Restructuring Plan the Company established a Severance Benefit Plan (the“Plan”) for affected employees as well as a retention plan for retained employees.  The Plan provides payment of severance benefits to affected employees of the Company.  The Company granted approximately 907,000 restricted stock units to retained employees with a two year vesting schedule and offered a cash retention bonus of 50% of each retained employees then current base salary, which will be earned and payable subject to continued employment for an additional 12 months.