UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2021

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________________ to  __________________

Commission File Number: 001-38268

ALLENA PHARMACEUTICALS, INC.

(Exact Name of Registrant as Specified in its Charter)

Securities registered pursuant to Section 12(b) of the Act:

Delaware	45-2729920
( State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
One Newton Executive Park, Suite 202 Newton, Massachusetts	02462
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (617) 467-4577

Securities registered or to be registered pursuant to Section 12(b) of the Act.

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	ALNA	The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes  ☒    No  ☐  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Small reporting company	☒
		Emerging growth Company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

As of August 6, 2021, the registrant had 80,140,728 shares of common stock, $0.001 par value per share, outstanding.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements. These statements include all matters that are not related to present facts or current conditions or that are not historical facts, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of management and expected market growth. The words “anticipate,” “believe,” “could,” “continue,” “should,” “predict,” “estimate,” “expect,” “intend,” “may,” “plan,” “potentially,” “will,” “may,” “would,” or the negative of these terms or other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements.

We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions described in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q, regarding, among other things:

• our estimates and expectations regarding our capital requirements, cash and expense levels, liquidity sources and our need for additional financing;

• the design and conduct of our planned Phase 3 clinical program of reloxaliase (formerly ALLN-177) in enteric hyperoxaluria, including the timing and outcome of our planned interim analyses;

• our ability to utilize the accelerated approval regulatory pathway for reloxaliase, including the timing of any Biologic License Application, or BLA, submission utilizing the accelerated approval regulatory pathway;

• the number, designs, results and timing of our clinical trials, including our pivotal Phase 3 program for reloxaliase, our planned Phase 2 program for ALLN-346 and our preclinical studies and the timing of the availability of data from these trials and studies;

• our ability to enroll a sufficient number of patients  (including as a result of any delays arising from the recent global outbreak of the coronavirus, or the COVID-19 coronavirus, which originated in Wuhan, China) and the ability of subjects in our clinical trials to adhere to the protocol, including capsule and dietary regimen and urinary collection requirements;

• the therapeutic benefits, effectiveness and safety of reloxaliase, ALLN-346 and our future product candidates;

• our ability to receive regulatory approval for our product candidates in the United States, Europe and other geographies;

• our expected regulatory approval pathway, and our ability to obtain, on satisfactory terms or at all, the financing required to support operations, development, clinical trials, and commercialization of products;

• our reliance on third parties for the planning, conduct and monitoring of clinical trials and for the manufacture of clinical drug supplies and drug product;

• potential changes in regulatory requirements, and delays or negative outcomes from the regulatory approval process;

• our estimates of the size and characteristics of the markets that may be addressed by reloxaliase and ALLN-346;

• the market acceptance of reloxaliase, ALLN-346 or any future product candidates that are approved for marketing in the United States or other countries;

• our ability to successfully commercialize reloxaliase with a targeted sales force, if approved;

• the safety and efficacy of therapeutics marketed by our competitors that are targeted to indications which our product candidates have been developed to treat;

• the impact of natural disasters, global pandemics (including the recent outbreak of a novel strain of the COVID-19 coronavirus), labor disputes, lack of raw material supply, issues with facilities and equipment or other forms of disruption to business operations at our manufacturing facilities;

• our ability to utilize our proprietary technological approach to develop and commercialize ALLN-346 and future product candidates;

• potential collaborators to license and commercialize reloxaliase, if approved, or any products for which we receive regulatory approval in the future outside of the United States;

• our heavy dependence on licensed intellectual property, including our ability to source and maintain licenses from third-party owners;

• our ability to protect our intellectual property and operate our business without infringing upon the intellectual property rights of others;

• our ability to attract, retain and motivate key personnel; and

• our ability to generate revenue and become profitable.

These risks are not exhaustive. Other sections of this Quarterly Report on Form 10-Q may include additional factors that could adversely impact our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risk factors emerge from time to time, and it is not possible for our management to predict all risk factors nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in, or implied by, any forward-looking statements.

We have included important factors in the cautionary statements included in this Quarterly Report on Form 10-Q, particularly in the “Risk Factors” section, that we believe could cause actual results or events to differ materially from the forward-looking statements that we make. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make. No forward-looking statement is a guarantee of future performance.

You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed as exhibits to the registration statement of which this Quarterly Report on Form 10-Q is a part completely and with the understanding that our actual future results may be materially different from what we expect. The forward-looking statements in this Quarterly Report on Form 10-Q represent our views as of the date of this Quarterly Report on Form 10-Q. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we have no current intention of doing so except to the extent required by applicable law. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this Quarterly Report on Form 10-Q.

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION	2
Item 1.	Financial Statements (Unaudited)	2
	Condensed Consolidated Balance Sheets	2
	Condensed Consolidated Statements of Operations and Comprehensive Loss	3
	Condensed Consolidated Statements of Stockholders’ Equity	4
	Condensed Consolidated Statements of Cash Flows	6
	Notes to Unaudited Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28
Item 4.	Controls and Procedures	28
PART II.	OTHER INFORMATION	29
Item 1.	Legal Proceedings	29
Item 1A.	Risk Factors	29
Item 2.	Unregistered Sales of Equity Securities	83
Item 3.	Defaults Upon Senior Securities	83
Item 4.	Mine Safety Disclosures	83
Item 5.	Other Information	83
Item 6.	Exhibits	84
Signatures		85

1

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

Allena Pharmaceuticals, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

(in thousands, except share and per share data)

	June 30, 2021			December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	26,656		$	35,042
Prepaid expenses and other current assets		1,665			2,207
Total current assets		28,321			37,249
Property and equipment, net		1,190			881
Operating lease assets		601			678
Other assets		173			123
Total assets	$	30,285		$	38,931
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	2,521		$	2,410
Accrued expenses and other current liabilities		4,976			3,421
Operating lease liabilities, net of discount		300			291
Total current liabilities		7,797			6,122
Loan payable, net of current portion and discount		9,880			9,853
Operating lease liabilities, net of current portion		341			387
Total liabilities		18,018			16,362
Commitments and contingencies (Note 6)
Stockholders’ equity:
Undesignated preferred stock, $0.001 par value; 5,000,000 shares authorized;    no shares issued or outstanding		—			—
Common stock, $0.001 par value; 200,000,000 and 125,000,000 shares     authorized at June 30, 2021 and December 31, 2020, respectively;     58,782,984 and 50,821,361 shares issued and outstanding at June 30, 2021     and December 31, 2020, respectively		59			51
Additional paid-in capital		235,605			220,307
Accumulated deficit		(223,397	)		(197,789	)
Total stockholders’ equity		12,267			22,569
Total liabilities and stockholders’ equity	$	30,285		$	38,931

See accompanying notes.

2

Allena Pharmaceuticals, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(unaudited)

(in thousands, except share and per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020
Operating expenses:
Research and development	$	10,090		$	3,808		$	17,942		$	8,454
General and administrative		3,597			2,751			7,155			5,629
Total operating expenses		13,687			6,559			25,097			14,083
Loss from operations		(13,687	)		(6,559	)		(25,097	)		(14,083	)
Other expense:
Interest expense		(253	)		(103	)		(488	)		(157	)
Other expense, net		(32	)		(314	)		(23	)		(321	)
Other expense, net		(285	)		(417	)		(511	)		(478	)
Net loss	$	(13,972	)	$	(6,976	)	$	(25,608	)	$	(14,561	)
Net loss per share attributable to common stockholders—basic and    diluted	$	(0.24	)	$	(0.26	)	$	(0.45	)	$	(0.56	)
Weighted-average common shares outstanding—basic and diluted		57,932,389			26,878,962			56,484,811			25,808,043
Net loss	$	(13,972	)	$	(6,976	)	$	(25,608	)	$	(14,561	)
Comprehensive loss	$	(13,972	)	$	(6,976	)	$	(25,608	)	$	(14,561	)

See accompanying notes.

3

Allena Pharmaceuticals, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(unaudited)

(in thousands, except share amounts)

Three Months Ended June 30,					Additional					Total
	Common stock				paid-in		Accumulated			stockholders’
	Shares		Amount		capital		deficit			equity
Balance at March 31, 2020		24,742,146	$	25	$	183,162	$	(172,529	)	$	10,658
Issuance of common stock, net of issuance costs		7,317,074		7		13,651		—			13,658
Exercise of common stock options		4,791		—		8		—			8
Issuance of common stock through    employee stock purchase plan ("ESPP")		20,003		—		27		—			27
Issuance of common stock through    release of restricted stock units ("RSUs")		140,720		—		—		—			—
Stock-based compensation		—		—		998		—			998
Net loss		—		—		—		(6,976	)		(6,976	)
Balance at June 30, 2020		32,224,734	$	32	$	197,846	$	(179,505	)	$	18,373
Balance at March 31, 2021		56,879,679	$	57	$	232,871	$	(209,425	)	$	23,503
Issuance of common stock, net of issuance costs		1,650,988		2		1,769		—			1,771
Issuance of common stock through    employee stock purchase plan ("ESPP")		4,206		—		5		—			5
Issuance of common stock through    release of restricted stock units ("RSUs")		248,111		—		—		—			—
Stock-based compensation		—		—		960		—			960
Net loss		—		—		—		(13,972	)		(13,972	)
Balance at June 30, 2021		58,782,984	$	59	$	235,605	$	(223,397	)	$	12,267

See accompanying notes

4

Allena Pharmaceuticals, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(unaudited)

(in thousands, except share amounts)

Six Months Ended June 30,					Additional					Total
	Common stock				paid-in		Accumulated			stockholders’
	Shares		Amount		capital		deficit			equity
Balance at December 31, 2019		24,735,009	$	25	$	182,117	$	(164,944	)	$	17,198
Issuance of common stock, net of issuance costs		7,317,074		7		13,651		—			13,658
Exercise of common stock options		11,928		—		18		—			18
Issuance of common stock through    employee stock purchase plan ("ESPP")		20,003		—		27		—			27
Issuance of common stock through    release of restricted stock units ("RSUs")		140,720		—		—		—			—
Stock-based compensation		—		—		2,033		—			2,033
Net loss		—		—		—		(14,561	)		(14,561	)
Balance at June 30, 2020		32,224,734	$	32	$	197,846	$	(179,505	)	$	18,373
Balance at December 31, 2020		50,821,361	$	51	$	220,307	$	(197,789	)	$	22,569
Issuance of common stock, net of issuance costs		7,709,306		8		13,466		—			13,474
Issuance of common stock through    employee stock purchase plan ("ESPP")		4,206		—		5		—			5
Issuance of common stock through    release of restricted stock units ("RSUs")		248,111		—		—		—			—
Stock-based compensation		—		—		1,827		—			1,827
Net loss		—		—		—		(25,608	)		(25,608	)
Balance at June 30, 2021		58,782,984	$	59	$	235,605	$	(223,397	)	$	12,267

See accompanying notes.

5

Allena Pharmaceuticals, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

(in thousands)

	Six Months Ended June 30,
	2021			2020
Cash flows from operating activities:
Net loss	$	(25,608	)	$	(14,561	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense		1,827			2,033
Depreciation expense		145			83
Non-cash interest expense		27			4
Non-cash lease expense		190			268
Changes in assets and liabilities:
Prepaid expenses and other current assets		542			1,105
Other assets		(50	)		—
Accounts payable		124			(2,483	)
Accrued expenses		1,555			(1,506	)
Operating lease liabilities		(150	)		(226	)
Net cash used in operating activities		(21,398	)		(15,283	)
Cash flows from investing activities:
Purchases of property and equipment		(457	)		—
Net cash used in investing activities		(457	)		—
Cash flows from financing activities:
Proceeds from the issuance of common stock, net of issuance costs		13,464			13,700
Proceeds from exercise of stock options		—			18
Proceeds from the issuance of stock through ESPP		5			27
Repayment of loan payable		—			(2,000	)
Other		—			(16	)
Net cash provided by financing activities		13,469			11,729
Net decrease in cash and cash equivalents		(8,386	)		(3,554	)
Cash and cash equivalents, beginning of period		35,042			30,007
Cash and cash equivalents, end of period	$	26,656		$	26,453
Supplemental disclosures:
Issuance costs included in accounts payable and accrued expenses	$	10		$	42

See accompanying notes.

6

Allena Pharmaceuticals, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

(in thousands, except share and per share data)

1. Nature of Business

Allena Pharmaceuticals, Inc. (the “Company”) is a late-stage clinical biopharmaceutical company dedicated to discovering, developing and commercializing first-in-class, oral biological therapeutics to treat patients with rare and severe metabolic and kidney disorders. The Company’s lead product candidate, reloxaliase (formerly known as ALLN-177), is currently being evaluated in a pivotal Phase 3 clinical program for the treatment of enteric hyperoxaluria, a metabolic disorder characterized by markedly elevated urinary oxalate levels and commonly associated with kidney stones, chronic kidney disease (“CKD”) and other serious kidney disorders. There are currently no approved therapies for the treatment of enteric hyperoxaluria. The Company is also developing ALLN-346 for the treatment of hyperuricemia and gout in the setting of advanced CKD.  The Company completed  a Phase 1b multiple-ascending dose study in the second quarter of 2021 and recently initiated dosing for the first of two planned Phase 2a studies.  The Company was incorporated under the laws of the State of Delaware on June 24, 2011 and is located in Newton, Massachusetts.                                                                      

The Company is subject to risks common to companies in the biotechnology industry, including but not limited to, risks of failure of preclinical studies and clinical trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the need to successfully commercialize and gain market acceptance of its product candidates, dependence on key personnel, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations, reliance on third party manufacturers, ability to transition from pilot-scale manufacturing to large-scale production of products and the need to obtain adequate additional financing to fund the development of its product candidates.

Liquidity and Going Concern

The Company had an accumulated deficit of $223.4 million at June 30, 2021 and will require substantial additional capital to fund operations. The future success of the Company is dependent on its ability to identify and develop its product candidates and ultimately upon its ability to attain profitable operations. At June 30, 2021, the Company had $26.7 million of cash and cash equivalents.  

On July 16, 2021, the Company completed a registered direct offering, in which the Company issued and sold 17,416,096 shares of its common stock, pre-funded warrants to purchase up to an aggregate of 3,941,648 shares of its common stock in lieu of shares of common stock, and warrants to purchase up to 10,678,872 shares of the Company’s common stock through a securities purchase agreement with several healthcare-focused institutional and accredited investors (“Securities Purchase Agreement”).  The combined price of each share of common stock and accompanying warrant to purchase one-half of a share of common stock was $1.311 per share.  The purchase price of each pre-funded Warrant was $1.301, which was the combined purchase price per share of common stock and accompanying warrant to purchase one-half of a share of common stock, minus $0.01.  Gross proceeds of the transaction were $28.0 million.  As a result of the registered direct offering, the Company received approximately $25.4 million after deducting offering costs in July 2021.  Each warrant is exercisable for one share of the Company’s common stock at an exercise price of $1.25 per share. The warrants are immediately exercisable and expire on July 16, 2026.  Each pre-funded warrant is exercisable for one share of our Common Stock at an exercise price of $0.01 per share. The pre-funded warrants are immediately exercisable and may be exercised at any time until all pre-funded warrants are exercised in full.  All pre-funded warrants were exercised on July 16, 2021.

The Company entered into an At Market Issuance Sales Agreement with B. Riley Securities, Inc. (“B. Riley ATM Agreement”) on March 29, 2021.  During the second quarter of 2021, the Company issued and sold 1,650,988 shares of its common stock under the B. Riley ATM Agreement at a weighted average price of $1.25 per share for net proceeds of approximately $1.8 million.

The Company’s available cash and cash equivalents as of June 30, 2021, along with the additional funds raised from the registered direct offering completed July 16, 2021, are not sufficient to fund the Company’s current operating plan for at least the next twelve months following the filing of this Quarterly Report. The Company requires additional capital to sustain its operations, including its reloxaliase development program. Management is exploring opportunities to secure additional funding through equity or debt financings or through collaborations, licensing transactions or other sources. The Company may be unable to obtain equity or debt financings or enter into collaboration or licensing transactions. Market volatility resulting from the COVID-19 pandemic or other factors could also adversely impact the Company’s ability to access capital as and when needed. The failure to obtain sufficient funds when needed would have a material adverse effect on the Company’s business, results of operations and financial condition and jeopardize its ability to continue operations.  These factors raise substantial doubt about the Company’s ability to continue as a going concern as of the filing date of this Quarterly Report. The

7

Company may implement cost reduction strategies, which may include amending, delaying, limiting, reducing, or terminating one or more of its ongoing or planned clinical trials or development programs of its product candidates. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

2. Summary of Significant Accounting Policies

Basis of Presentation

The Company’s unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations.  Accordingly, these financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2020 and notes thereto, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 11, 2021.  The unaudited interim consolidated financial statements have been prepared on the same basis as the audited financial statements. In the opinion of the Company’s management, the accompanying unaudited interim condensed consolidated financial statements contain all adjustments which are necessary to present fairly the Company’s financial position as of June 30, 2021, the results of its operations for the three and six months ended June 30, 2021 and June 30, 2020 and cash flows for the six months ended June 30, 2021 and June 30, 2020. Such adjustments are of a normal and recurring nature. The results for the three and six months ended June 30, 2021 are not necessarily indicative of the results for the year ending December 31, 2021, or for any future period.

Principles of Consolidation

The consolidated financial statements include the accounts of Allena Pharmaceuticals, Inc. and its wholly owned subsidiaries, Allena Pharmaceuticals Security Corporation (“Security Corporation”), which was incorporated in December 2014, and Allena Pharmaceuticals Ireland Limited, which was incorporated in March 2017. All intercompany transactions and balances have been eliminated.

Fair Value of Financial Instruments

Fair value is defined as the price that would be received upon sale of an asset or paid to transfer a liability between market participants at measurement dates. ASC Topic 820, Fair Value Measurement (“ASC 820”), establishes a three-level valuation hierarchy for instruments measured at fair value. The hierarchy is based on the transparency of inputs to the valuation of an asset or liability as of the measurement date. The hierarchy defines three levels of valuation inputs, of which the first two are considered observable and the last is considered unobservable:

Level 1 inputs: Quoted prices in active markets for identical assets or liabilities.

Level 2 inputs: Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable, such as quoted market prices, interest rates and yield curves.

Level 3 inputs: Unobservable inputs developed using estimates or assumptions developed by the Company, which reflect those that a market participant would use in pricing the asset or liability.

To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

8

Use of Estimates

The preparation of the Company’s condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, expenses and related disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of expenses during the reporting period.  On an ongoing basis, the Company’s management evaluates its estimates, which include, but are not limited to, management’s judgment of prepaid and accrued research and development expenses and the valuation of share-based awards.  Actual results could differ from those estimates.

The remainder of the Company’s significant accounting policies are described in the Annual Report filed on Form 10-K for the year ended December 31, 2020 that was filed with the United States Securities and Exchange Commission on March 11, 2021.

Recently Adopted Accounting Pronouncements  

 In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which is intended to simplify various aspects related to accounting for income taxes. The new guidance became effective for the Company on January 1, 2021. The adoption of ASU 2019-12 did not have a material impact on the Company’s condensed consolidated financial statements. In 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”), which modifies the disclosure requirements on fair value measurements.  The new guidance became effective for the Company on January 1, 2020.  The adoption of ASU 2018-13 did not have a material impact on the Company’s condensed consolidated financial statements.

Recently Issued Accounting Pronouncements  

In 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which requires entities to record expected credit losses for certain financial instruments, including trade receivables, as an allowance that reflects the entity's current estimate of credit losses expected to be incurred.  For available-for-sale debt securities in unrealized loss positions, ASU 2016-13 requires allowances to be recorded instead of reducing the amortized cost of the investment.  ASU 2016-13 is effective for smaller reporting companies on January 1, 2023.  Early adoption is permitted.  The Company does not expect that the adoption of ASU 2016-13 will have a material impact on its condensed consolidated financial statements.

In 2020, the FASB issued ASU 2020-06, Debt -Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40), simplifies the accounting for convertible debt and convertible preferred stock by removing the requirements to separately present certain conversion features in equity. In addition, the amendments in the ASU also simplify the guidance in ASC 815-40, Derivatives and Hedging: Contracts in Entity’s Own Equity (“ASU 2020-06”), by removing certain criteria that must be satisfied in order to classify a contract as equity, which is expected to decrease the number of freestanding instruments and embedded derivatives accounted for as assets or liabilities. Finally, the amendments revise the guidance on calculating earnings per share, requiring use of the if-converted method for all convertible instruments and rescinding an entity’s ability to rebut the presumption of share settlement for instruments that may be settled in cash or other assets. ASU 2020-06 is effective for smaller reporting companies on January 1, 2022.  Early adoption is permitted.  The Company does not expect that the adoption of ASU 2020-06 will have a material impact on its condensed consolidated financial statements.

3. Net Loss per Share

Basic net loss per share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding for the period, without consideration for potentially dilutive securities. The Company has computed diluted net loss per common share after giving consideration to all potentially dilutive common shares, including options to purchase common stock, restricted stock units, common stock issuable upon the conversion of outstanding debt and warrants to purchase common stock, outstanding during the period determined using the treasury-stock and if-converted methods, except where the effect of including such securities would be antidilutive. Because the Company has reported net losses since inception, these potential common shares have been anti-dilutive and basic and diluted loss per share have been the same.

9

Basic and diluted net loss per share attributable to common stockholders was calculated as follows (in thousands, except share and per share data):

	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020
Numerator:
Net loss	$	(13,972	)	$	(6,976	)	$	(25,608	)	$	(14,561	)
Net loss attributable to common stockholders	$	(13,972	)	$	(6,976	)	$	(25,608	)	$	(14,561	)
Denominator:
Weighted-average common shares—basic and diluted		57,932,389			26,878,962			56,484,811			25,808,043
Net loss per share attributable to common    stockholders—basic and diluted	$	(0.24	)	$	(0.26	)	$	(0.45	)	$	(0.56	)

The following table sets forth the potentially dilutive securities that have been excluded from the calculation of diluted net loss per share because to include them would be anti-dilutive (in common stock equivalent shares):

	Six Months Ended June 30,
	2021		2020
Stock options		7,091,757		3,766,567
Restricted stock units		372,166		553,468
Common stock issuable upon conversion of outstanding debt		2,439,024		—
Warrants		9,040		9,040
Total		9,911,987		4,329,075

4. Fair Value Measurements

The following tables present information about the Company’s financial assets and liabilities that have been measured at fair value at June 30, 2021 and December 31, 2020, and indicates the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):

Description	June 30, 2021		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Money market funds, included in cash and cash equivalents	$	25,235	$	25,235	$	—	$	—
Total assets	$	25,235	$	25,235	$	—	$	—

Description	December 31, 2020		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)
Assets:
Money market funds, included in cash and cash equivalents	$	34,698	$	34,698