QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
☒ |
Accelerated filer |
☐ | ||||
Non-accelerated filer |
☐ |
Smaller reporting company |
||||
Emerging growth company |
☐ |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
The |
Page |
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3 |
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Item 1. |
3 |
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3 |
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4 |
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5 |
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6 |
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7 |
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Item 2. |
15 |
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Item 3. |
22 |
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Item 4. |
22 |
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22 |
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Item 1. |
22 |
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Item 1A. |
23 |
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Item 2. |
60 |
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Item 3. |
60 |
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Item 4. |
60 |
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Item 5. |
60 |
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Item 6. |
60 |
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62 |
Item 1. |
Financial Statements |
June 30, 2019 |
December 31, 2018 |
|||||||
(Unaudited) |
||||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | $ | ||||||
Short-term marketable securities |
||||||||
Prepaid expenses and other current assets |
||||||||
Total current assets |
||||||||
Property and equipment, net |
||||||||
Long-term marketable securities |
||||||||
Operating lease r ight-of-use assets |
— |
|||||||
Restricted cash |
||||||||
Other assets, noncurrent |
||||||||
Total assets |
$ | $ | ||||||
Liabilities and Stockholders’ Equity |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | $ | ||||||
Accrued liabilities |
||||||||
Accrued compensation |
||||||||
Other liabilities, current |
||||||||
Total current liabilities |
||||||||
Operating lease liabilities, noncurrent |
— |
|||||||
Other liabilities, noncurrent |
||||||||
Total liabilities |
||||||||
Commitments and contingencies |
||||||||
Stockholders’ equity: |
||||||||
Preferred stock, $ |
— |
— |
||||||
Common stock, $ |
||||||||
Additional paid-in capital |
||||||||
Accumulated other comprehensive income (loss) |
( |
) | ||||||
Accumulated deficit |
( |
) | ( |
) | ||||
Total stockholders’ equity |
||||||||
Total liabilities and stockholders’ equity |
$ | $ | ||||||
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Operating expenses: |
||||||||||||||||
Research and development |
$ | $ | $ | $ | ||||||||||||
General and administrative |
||||||||||||||||
Total operating expenses |
||||||||||||||||
Loss from operations |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Other income (expense): |
||||||||||||||||
Interest income, net |
||||||||||||||||
Other income (expenses), net |
( |
) | ( |
) | ( |
) | ||||||||||
Total other income, net |
||||||||||||||||
Net loss |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Other comprehensive loss: |
||||||||||||||||
Net unrealized gain on marketable securities, net of tax |
||||||||||||||||
Comprehensive loss |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
Basic and diluted net loss per common share |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
Weighted-average number of shares used in computing basic and diluted net loss per common share |
||||||||||||||||
Common Stock |
Additional Paid- In Capital |
Accumulated Other Comprehensive Loss |
Accumulated Deficit |
Total Stockholders’ Equity |
|||||||||||||||||||||
|
|
|
|
|
| ||||||||||||||||||||
Shares |
Amount |
||||||||||||||||||||||||
Balance at December 31, 2018 |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
||||||||||||
Issuance of common stock upon equity offerings, net of issuance costs |
|
— |
|
— |
— |
|
|||||||||||||||||||
Issuance of common stock upon exercise of stock options |
|
— |
|
— |
— |
|
|||||||||||||||||||
Issuance of common stock upon vesting of restricted share units, net of shares withheld for employee taxes |
|
— |
( |
) | — |
— |
( |
) | |||||||||||||||||
Issuance of common stock pursuant to ESPP purchases |
|
— |
|
— |
— |
|
|||||||||||||||||||
Vesting of restricted stock purchases |
|
— |
|
— |
— |
|
|||||||||||||||||||
Stock-based compensation expense |
— |
— |
|
— |
— |
|
|||||||||||||||||||
Net unrealized gain on marketable securities |
— |
— |
— |
|
— |
|
|||||||||||||||||||
Net loss |
— |
— |
— |
— |
( |
) | ( |
) | |||||||||||||||||
Balance at March 31, 2019 |
|
$ | |
$ | |
$ | |
$ | ( |
) | $ | |
|||||||||||||
Issuance of common stock upon equity offerings, net of issuance costs |
|
|
|
— |
— |
|
|||||||||||||||||||
Issuance of common stock upon exercise of stock options |
|
|
|
— |
— |
|
|||||||||||||||||||
Issuance of common stock upon vesting of restricted share units, net of shares withheld for employee taxes |
|
— |
( |
) | — |
— |
( |
) | |||||||||||||||||
Vesting of restricted stock purchases |
|
— |
|
— |
— |
|
|||||||||||||||||||
Stock-based compensation expense |
— |
— |
|
— |
— |
|
|||||||||||||||||||
Net unrealized gain on marketable securities |
— |
— |
— |
|
— |
|
|||||||||||||||||||
Net loss |
— |
— |
— |
— |
( |
) | ( |
) | |||||||||||||||||
Balance at June 30, 2019 |
|
$ | |
$ | |
$ | |
$ | ( |
) | $ | |
|||||||||||||
Common Stock |
Additional Paid- In Capital |
Accumulated Other Comprehensive Loss |
Accumulated Deficit |
Total Stockholders’ Equity |
|||||||||||||||||||||
|
|
|
|
|
| ||||||||||||||||||||
Shares |
Amount |
||||||||||||||||||||||||
Balance at December 31, 2017 |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
||||||||||||
Issuance of common stock upon equity offerings, net of issuance costs |
|
|
|
— |
— |
|
|||||||||||||||||||
Issuance of common stock upon exercise of stock options |
|
|
|
— |
— |
|
|||||||||||||||||||
Issuance of common stock upon vesting of restricted share units, net of shares withheld for employee taxes |
|
— |
( |
) | — |
— |
( |
) | |||||||||||||||||
Issuance of common stock pursuant to ESPP purchases |
|
— |
|
— |
— |
|
|||||||||||||||||||
Vesting of restricted stock purchases |
|
— |
|
— |
— |
|
|||||||||||||||||||
Stock-based compensation expense |
— |
— |
|
— |
— |
|
|||||||||||||||||||
Net unrealized gain on marketable securities |
— |
— |
— |
|
— |
|
|||||||||||||||||||
Net loss |
— |
— |
— |
— |
( |
) | ( |
) | |||||||||||||||||
Balance at March 31, 2018 |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
||||||||||||
Offering cost related to the December 2017 follow-on offerings |
— |
— |
|
— |
— |
|
|||||||||||||||||||
Issuance of common stock upon exercise of stock options |
|
— |
|
— |
— |
|
|||||||||||||||||||
Issuance of common stock upon vesting of restricted share units, net of shares withheld for employee taxes |
|
— |
— |
— |
— |
— |
|||||||||||||||||||
Vesting of restricted stock purchases |
|
— |
|
— |
— |
|
|||||||||||||||||||
Stock-based compensation expense |
— |
— |
|
— |
— |
|
|||||||||||||||||||
Net unrealized gain on marketable securities |
— |
— |
— |
|
— |
|
|||||||||||||||||||
Net loss |
— |
— |
— |
— |
( |
) | ( |
) | |||||||||||||||||
Balance at June 30, 2018 |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
||||||||||||
Six Months Ended June 30, |
||||||||
2019 |
2018 |
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
Net loss |
$ | ( |
) | $ | ( |
) | ||
Adjustments to reconcile net loss to net cash used in operating activities: |
||||||||
Depreciation and amortization |
|
|
||||||
Amortization (accretion) of premium (discount) on marketable securities |
( |
) | |
|||||
Amortization of operating lease right-of-use assets |
|
— |
||||||
Stock-based compensation |
|
|
||||||
Changes in operating assets and liabilities: |
||||||||
Prepaid expenses and other assets |
|
( |
) | |||||
Accounts payable |
|
( |
) | |||||
Accrued liabilities |
|
|
||||||
Accrued compensation |
( |
) | ( |
) | ||||
Operating lease liabilities |
( |
) | — |
|||||
Other liabilities |
— |
|
||||||
Net cash used in operating activities |
( |
) | ( |
) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||
Purchase of property and equipment |
( |
) | ( |
) | ||||
Purchase of marketable securities |
( |
) | ( |
) | ||||
Maturities of marketable securities |
|
|
||||||
Net cash used in investing activities |
( |
) | ( |
) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
Proceeds from issuance of common stock in public offering, net of issuance costs |
|
|
||||||
Proceeds from issuance of common stock in settlement of employee stock purchase plan and exercise of stock options |
|
|
||||||
Tax paid related to net share settlement of equity awards |
( |
) | ( |
) | ||||
Net cash provided by financing activities |
|
|
||||||
Net increase in cash, cash equivalents and restricted cash |
|
|
||||||
Cash, cash equivalents and restricted cash at beginning of period |
|
|
||||||
Cash, cash equivalents and restricted cash at end of period |
$ | |
$ | |
||||
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING INFORMATION: |
||||||||
Leasehold improvements paid for by landlord |
$ | |
$ | — |
||||
Accrued purchase of property and equipment |
$ | |
$ | ( |
) | |||
Accrued offering costs |
$ | |
$ | — |
||||
December 31, 2018 |
Adjustments Due to our Adoption of Topic 842 |
January 1, 2019 |
||||||||||
Assets: |
||||||||||||
Operating lease ROU assets |
$ | — |
$ | $ | ||||||||
Liabilities: |
||||||||||||
Operating lease liabilities, current as included in other liabilities, current |
— |
|||||||||||
Deferred rent, current as included in other liabilities, current |
( |
) | — |
|||||||||
Operating lease liabilities, noncurrent |
— |
|||||||||||
Deferred rent, noncurrent as included in other liabilities, noncurrent |
( |
) | — |
June 30, 2019 |
||||||||||||||||
Total |
Level 1 |
Level 2 |
Level 3 |
|||||||||||||
Financial Assets: |
||||||||||||||||
Money market funds |
$ | $ | $ | — |
$ | — |
||||||||||
Corporate debt securities |
— |
— |
||||||||||||||
U.S. government agency securities |
— |
— |
||||||||||||||
Certificates of deposits |
— |
— |
||||||||||||||
U.S. government securities |
— |
— |
||||||||||||||
Total financial assets |
$ | $ | $ | $ | — |
|||||||||||
December 31, 2018 |
||||||||||||||||
Total |
Level 1 |
Level 2 |
Level 3 |
|||||||||||||
Financial Assets: |
||||||||||||||||
Money market funds |
$ | $ | $ | — |
$ | — |
||||||||||
Corporate debt securities |
— |
— |
||||||||||||||
U.S. government agency securities |
— |
— |
||||||||||||||
Certificates of deposits |
— |
— |
||||||||||||||
U.S. government securities |
— |
— |
||||||||||||||
Total financial assets |
$ | $ | $ | $ | — |
|||||||||||
June 30, 2019 |
December 31, 2018 |
|||||||||||||||||||||||||||||||
Amortized Cost |
Unrealized Gains |
Unrealized (Losses) |
Estimated Fair Value |
Amortized Cost |
Unrealized Gains |
Unrealized (Losses) |
Estimated Fair Value |
|||||||||||||||||||||||||
Financial Assets: |
||||||||||||||||||||||||||||||||
Money market funds |
$ | $ | — |
$ | — |
$ | $ | $ | — |
$ | — |
$ | ||||||||||||||||||||
Corporate debt securities |
— |
( |
) | |||||||||||||||||||||||||||||
U.S. government agency securities |
( |
) | ( |
) | ||||||||||||||||||||||||||||
Certificates of deposits |
— |
( |
) | |||||||||||||||||||||||||||||
U.S. government securities |
— |
( |
) | |||||||||||||||||||||||||||||
Total |
$ | $ | $ | ( |
) | $ | $ | $ | $ | ( |
) | $ | ||||||||||||||||||||
June 30, 2019 |
December 31, 2018 |
|||||||
Cash and cash equivalents |
$ | $ | ||||||
Short-term marketable securities |
||||||||
Long-term marketable securities |
||||||||
Total |
$ | $ | ||||||
June 30, 2019 |
December 31, 2018 |
|||||||
Laboratory equipment |
$ | |
$ | |
||||
Computer equipment |
|
|
||||||
Leasehold improvements |
|
|
||||||
Construction-in-progress |
|
|
||||||
Total property and equipment |
|
|
||||||
Less: accumulated depreciation and amortization |
( |
) | ( |
) | ||||
Property and equipment, net |
$ | |
$ | |
||||
June 30, 2019 |
December 31, 2018 |
|||||||
Accrued clinical and manufacturing expenses |
$ | |
$ | |
||||
Accrued professional and consulting services |
|
|
||||||
Other |
|
|
||||||
Total accrued liabilities |
$ | |
$ | |
||||
June 30, 2019 |
December 31, 2018 |
|||||||
Operating lease liabilities, current |
$ | |
$ | — |
||||
Restricted shares subject to repurchase, current |
— |
|
||||||
Deferred rent, current |
— |
|
||||||
Other payable |
|
|
||||||
Total other liabilities, current |
$ | |
$ | |
||||
Deferred rent, noncurrent |
$ | — |
$ | |
||||
Accrued lease liabilities |
|
— |
||||||
Other liabilities, noncurrent |
|
|
||||||
Total other liabilities, noncurrent |
$ | |
$ | |
||||
Number of Options |
Weighted- Average Exercise Price |
|||||||
Outstanding — December 31, 2018 |
|
$ | |
|||||
Options granted |
|
|
||||||
Options exercised |
( |
) | |
|||||
Options canceled |
( |
) | |
|||||
Outstanding — June 30, 2019 |
|
$ | |
|||||
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Expected term (in years) |
|
|
|
|
||||||||||||
Volatility |
|
|
|
|
||||||||||||
Risk-free interest rate |
|
|
|
|
||||||||||||
Dividend yield |
— |
— |
— |
— |
Number of RSUs |
Weighted- Average Grant Date Fair Value |
|||||||
Non-vested units — December 31, 2018 |
|
$ | |
|||||
RSUs granted |
|
|
||||||
RSUs vested |
( |
) | |
|||||
RSUs forfeited |
( |
) | |
|||||
Non-vested units — June 30, 2019 |
|
$ | |
|||||
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Research and development |
$ | |
$ | |
$ | |
$ | |
||||||||
General and administrative |
|
|
|
|
||||||||||||
Total stock-based compensation expense |
$ | |
$ | |
$ | |
$ | |
||||||||
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Options to purchase common stock |
|
|
|
|
||||||||||||
Restricted stock subject to future vesting |
— |
|
— |
|
||||||||||||
Restricted stock units |
|
|
|
|
||||||||||||
Total |
|
|
|
|
||||||||||||
Year ending December 31, |
Amount (a) |
|||
2019 (six months) |
$ | |
||
2020 |
|
|||
2021 |
|
|||
2022 |
|
|||
2023 |
|
|||
2024 |
|
|||
Thereafter |
|
|||
Total lease payments |
|
|||
Less: Imputed interest (b) |
( |
) | ||
Present value of operating lease liabilities |
$ | |
||
(a) |
Operating lease payments exclude $ |
(b) |
Imputed interest is calculated using the interest rate for each lease. |
Year ending December 31, |
Amount (c) |
|||
2019 |
$ | |
||
2020 |
|
|||
2021 |
|
|||
2022 |
|
|||
2023 |
|
|||
Thereafter |
|
|||
Total |
$ | |
||
(c) |
The table above is prepared under the assumption that the Substitute Premises Commencement Date at the Substitute Premises starts on June 30, 2020. |
Item 2. |
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Three Months Ended June 30, |
$ Change |
% Change |
||||||||||||||
2019 |
2018 |
|||||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Operating expenses: |
||||||||||||||||
Research and development |
$ | 36,010 |
$ | 31,573 |
$ | 4,437 |
14 |
% | ||||||||
General and administrative |
24,794 |
10,914 |
13,880 |
127 |
% | |||||||||||
Total operating expenses |
60,804 |
42,487 |
18,317 |
43 |
% | |||||||||||
Loss from operations |
(60,804 |
) | (42,487 |
) | (18,317 |
) | 43 |
% | ||||||||
Interest income, net |
3,546 |
2,115 |
1,431 |
68 |
% | |||||||||||
Other income (expenses), net |
(63 |
) | 4 |
(67 |
) | * |
||||||||||
Net loss |
$ | (57,321 |
) | $ | (40,368 |
) | $ | (16,953 |
) | 42 |
% | |||||
• | employee-related expenses, which include salaries, benefits and stock-based compensation; |
• | expenses incurred under agreements with consultants, third-party research and manufacturing organizations, and investigative clinical trial sites that conduct research and development activities on our behalf; |
• | the costs related to production of clinical supplies, including fees paid to contract manufacturers; |
• | laboratory and vendor expenses related to the execution of nonclinical studies and clinical trials; |
• | payments upon achievement of certain clinical development and regulatory milestones in relation with license agreements; and |
• | facilities and other allocated expenses, which include expenses for rent and maintenance of facilities, depreciation and amortization expense and other supplies. |
Three Months Ended June 30, |
$ Change |
% Change |
||||||||||||||
2019 |
2018 |
|||||||||||||||
Costs incurred by development program: |
||||||||||||||||
Voxelotor for the treatment of SCD |
$ | 29,490 |
$ | 24,888 |
$ | 4,602 |
18 |
% | ||||||||
Other preclinical programs and voxelotor for the treatment of hypoxemic pulmonary disorders |
5,165 |
6,127 |
(962 |
) | (16 |
)% | ||||||||||
Inclacumab for the treatment of SCD |
1,355 |
558 |
797 |
143 |
% | |||||||||||
Total research and development expenses |
$ | 36,010 |
$ | 31,573 |
$ | 4,437 |
14 |
% | ||||||||
Six Months Ended June 30, |
$ Change |
% Change |
||||||||||||||
2019 |
2018 |
|||||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Operating expenses: |
||||||||||||||||
Research and development |
$ | 70,476 |
$ | 61,517 |
$ | 8,959 |
15 |
% | ||||||||
General and administrative |
42,849 |
23,665 |
19,184 |
81 |
% | |||||||||||
Total operating expenses |
113,325 |
85,182 |
28,143 |
33 |
% | |||||||||||
Loss from operations |
(113,325 |
) | (85,182 |
) | (28,143 |
) | 33 |
% | ||||||||
Interest income, net |
7,196 |
3,287 |
3,909 |
119 |
% | |||||||||||
Other expenses, net |
(115 |
) | (29 |
) | (86 |
) | 297 |
% | ||||||||
Net loss |
$ | (106,244 |
) | $ | (81,924 |
) | $ | (24,320 |
) | 30 |
% | |||||
Six Months Ended June 30, |
$ Change |
% Change |
||||||||||||||
2019 |
2018 |
|||||||||||||||
Costs incurred by development program: |
||||||||||||||||
Voxelotor for the treatment of SCD |
$ | 57,214 |
$ | 48,019 |
$ | 9,195 |
19 |
% | ||||||||
Other preclinical programs and voxelotor for the treatment of hypoxemic pulmonary disorders |
10,527 |
12,940 |
(2,413 |
) | (19 |
)% | ||||||||||
Inclacumab for the treatment of SCD |
2,735 |
558 |
2,177 |
390 |
% | |||||||||||
Total research and development expenses |
$ | 70,476 |
$ | 61,517 |
$ | 8,959 |
15 |
% | ||||||||
• | the time and cost necessary to complete our Phase 3 HOPE Study and conduct and complete our ongoing Phase 2a HOPE-KIDS 1 Study of voxelotor for the potential treatment of SCD; |
• | the time and cost necessary to conduct and complete any additional clinical studies required to pursue regulatory approvals for voxelotor for SCD including our planned TCD post-approval confirmatory study, as well as any other studies we may conduct for voxelotor in SCD or any other indications, and the costs of post-marketing studies that could be required by regulatory authorities for any indications; |
• | the progress, data and results of our Phase 3 HOPE Study and Phase 2a HOPE-KIDS 1 Study, as well as potential other clinical trials of voxelotor for the potential treatment of SCD, including our planned TCD post-confirmatory study and other future clinical studies of voxelotor that we may determine to conduct; |
• | the progress, timing, scope and costs of our nonclinical studies, our clinical trials and other related activities, including our ability to enroll subjects in a timely manner for our ongoing and future clinical trials of voxelotor for SCD or for inclacumab or any other product candidates that we may identify and develop; |
• | the costs of obtaining clinical and commercial supplies of voxelotor, inclacumab and any other product candidates we may identify and develop; |
• | our ability to advance our development programs, including our program for the clinical investigation of voxelotor in SCD patients through nonclinical and clinical development, as well as inclacumab and any other potential product candidate programs we may identify and pursue, the timing and scope of these development activities, and the availability of accelerated approval for voxelotor and of any approval for any of our other product candidates; |
• | our ability to successfully obtain any regulatory approvals from any regulatory authorities, and the scope of any such regulatory approvals, to market and sell voxelotor, inclacumab and any other product candidates we may identify and develop in any territory(ies); |
• | our ability to successfully commercialize voxelotor and any other product candidates we may identify and develop in any territories; |
• | the manufacturing, selling and marketing costs associated with the potential commercialization of voxelotor, inclacumab and any other product candidates we may identify and develop, including the cost and timing of establishing our sales and marketing capabilities in any territory(ies); |
• | the amount and timing of sales and other revenues from voxelotor, inclacumab and any other product candidates we may identify and develop, including the sales price and the availability of adequate third-party reimbursement; |
• | the cash requirements of any future acquisitions or discovery of product candidates; |
• | the time and cost necessary to respond to technological and market developments; |
• | the extent to which we may acquire or in-license other product candidates and technologies and the costs and timing associated with any such acquisitions or in-licenses; |
• | our ability to attract, hire, and retain qualified personnel; and |
• | the costs of maintaining, expanding, and protecting our intellectual property portfolio. |
Six Months Ended June 30, |
||||||||
2019 |
2018 |
|||||||
Cash used in operating activities |
$ | (78,253 |
) | $ | (70,900 |
) | ||
Cash used in investing activities |
(74,922 |
) | (39,080 |
) | ||||
Cash provided by financing activities |
216,272 |
253,611 |
||||||
Net increase in cash, cash equivalents and restricted cash |
$ | 63,097 |
$ | 143,631 |
||||
December 31, 2018 |
Adjustments Due to our Adoption of Topic 842 |
January 1, 2019 |
||||||||||
Assets: |
||||||||||||
Operating lease ROU assets |
$ | — |
$ | 14,177 |
$ | 14,177 |
||||||
Liabilities: |
||||||||||||
Operating lease liabilities, current as included in other liabilities, current |
— |
1,176 |
1,176 |
|||||||||
Deferred rent, current as included in other liabilities, current |
712 |
(712 |
) | — |
||||||||
Operating lease liabilities, noncurrent |
— |
24,754 |
24,754 |
|||||||||
Deferred rent, noncurrent as included in other liabilities, noncurrent |
11,041 |
(11,041 |
) | — |
Item 3. |
Quantitative and Qualitative Disclosures about Market Risk |
Item 4. |
Controls and Procedures |
Item 1. |
Legal Proceedings |
Item 1A. |
Risk Factors. |
• | continue to advance voxelotor in clinical development, including completion of our ongoing Phase 3 HOPE Study and our ongoing Phase 2a HOPE-KIDS 1 Study of voxelotor for the potential treatment of patients with SCD,initiation and completion of our planned transcranial doppler (“TCD”) post-confirmatory study of voxelotor in SCD (and any other post-marketing studies that may be required by regulatory authorities, if any), and any additional clinical trials of voxelotor we may conduct in the future in SCD patients or for any other indications for voxelotor, inclacumab or any other product candidates if any; |
• | establish and maintain manufacturing and supply relationships with third parties that can provide adequate supplies (in amount and quality) of voxelotor and inclacumab to support further clinical development and, if approved, commercialization; |
• | seek and obtain regulatory and marketing approvals for voxelotor for SCD or any other indication we may pursue; |
• | build a sales and marketing organization or enter into selected collaborations to commercialize voxelotor for SCD or any other indication, if approved; |
• | build a medical affairs organization to advance our engagement with healthcare providers and stakeholders; |
• | advance our other programs, including inclacumab, through nonclinical and clinical development and commence development activities for any additional product candidates we may identify and pursue; and |
• | expand our organization to support our research, development, medical, and commercialization activities and our operations as a public company. |
• | the time and cost necessary to complete our ongoing Phase 3 HOPE Study and conduct and complete our ongoing Phase 2a HOPE-KIDS 1 Study of voxelotor for the potential treatment of SCD, as well as to conduct our OLE study in HOPE study countries and our EAP in the United States; |
• | the time and cost necessary to conduct and complete any additional clinical studies required to pursue regulatory approvals for voxelotor for SCD, including our planned TCD confirmatory study of voxelotor in SCD, or any other post-marketing studies that could be required by regulatory authorities for voxelotor for SCD; |
• | the progress, data and results of our Phase 3 HOPE Study and Phase 2a HOPE-KIDS 1 Study, as well as our planned TCD post-confirmatory study and any other clinical trials of voxelotor that we may conduct for the potential treatment of SCD in the future; |
• | the progress, timing, scope and costs of our nonclinical studies, our clinical trials and other related activities, including our ability to enroll subjects in a timely manner for our ongoing and future clinical trials of voxelotor for SCD or for inclacumab or any other product candidate that we may identify and develop; |
• | the costs of obtaining clinical and commercial supplies of voxelotor, inclacumab and any other product candidates we may identify and develop; |
• | our ability to advance our development programs, including our program for the clinical investigation of voxelotor in SCD patients through nonclinical and clinical development, as well as inclacumab and any other potential product candidate programs we may identify and pursue, the timing and scope of these development activities, and the availability of accelerated approval for voxelotor and of any approval for any of our other product candidates; |
• | our ability to successfully obtain any regulatory approvals from any regulatory authorities, and the scope of any such regulatory approvals, to market and sell voxelotor, inclacumab and any other product candidates we may identify and develop in any territory(ies); |
• | our ability to successfully commercialize voxelotor, inclacumab and any other product candidates we may identify and develop in any territories; |
• | the manufacturing, selling, and marketing costs associated with the potential commercialization of voxelotor, inclacumab and any other product candidates we may identify and develop, including the cost and timing of establishing our sales and marketing capabilities in any territory(ies); |
• | the amount and timing of sales and other revenues from voxelotor, inclacumab and any other product candidates we may identify and develop, including the sales price and the availability of adequate third-party reimbursement; |
• | the cash requirements of any future acquisitions or discovery of product candidates; |
• | the time and cost necessary to respond to technological and market developments; |
• | the extent to which we may acquire or in-license other product candidates and technologies, and the costs and timing associated with any such acquisitions or in-licenses; |
• | our ability to attract, hire, and retain qualified personnel; and |
• | the costs of maintaining, expanding, and protecting our intellectual property portfolio. |
• | we may not be able to demonstrate to the satisfaction of the FDA or comparable foreign regulatory authorities (including the European Medicines Agency (“EMA”)) that voxelotor or any other product candidates we may develop are safe and effective for any proposed indications; |
• | the FDA or comparable foreign regulatory authorities may disagree with our plans or expectations regarding the pathways and endpoints for approval, including the availability of accelerated approval, or the design or implementation of our nonclinical studies or clinical trials; |
• | the populations studied in our clinical programs may not be sufficiently broad or representative to assure safety or demonstrate efficacy in the full population for which we seek approval; |
• | the FDA or comparable foreign regulatory authorities may require additional nonclinical studies or clinical trials beyond those we anticipate; |
• | the FDA or comparable foreign regulatory authorities may disagree with our interpretation of data and results from our nonclinical studies or clinical trials; |
• | the data and results collected from nonclinical studies or clinical trials of voxelotor and any other product candidates that we may identify and pursue may not be sufficient to support the submission of a new drug application (“NDA”), or any other submission for regulatory approval in any other jurisdiction; |
• | we may be unable to demonstrate to the FDA or comparable foreign regulatory authorities that a product candidate’s risk-benefit ratio for its proposed indication is acceptable; |
• | the FDA or comparable foreign regulatory authorities may find deficiencies with or fail to approve the manufacturing processes, test procedures and specifications, or facilities of third-party manufacturers with which we contract and rely on for all clinical and commercial supplies of voxelotor and any other product candidates (if any); and |
• | the approval policies or regulations of the FDA or comparable foreign regulatory authorities may change in a manner that renders our development or manufacturing efforts insufficient for approval. |
• | delays or failures in reaching a consensus with regulatory agencies on study design, including clinical endpoints sufficient to support an approval decision; |
• | delays or failures to receive approval for conduct of clinical studies in one or more geographies which could result in delays in enrollment and availability of data and results; |
• | delays or failures in reaching agreement on acceptable terms with a sufficient number of prospective contract research organizations (“CROs”), and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites; |
• | delays in obtaining required Institutional Review Board (“IRB”), or ethics committee approval for each clinical trial site; |
• | delays in recruiting a sufficient number of suitable patients to participate in our clinical trials; |
• | imposition of a clinical hold by any regulatory authority, including if imposed due to safety concerns after an inspection of our clinical trial operations or study sites; |
• | failure by our CROs, clinical sites, participating clinicians or patients, other third parties or us to adhere to clinical trial, regulatory or legal requirements; |
• | failure to perform in accordance with the FDA’s good clinical practices (“GCPs”), or applicable regulatory requirements in other countries; |
• | delays in the testing, validation, manufacturing and delivery of sufficient quantities of our product candidates or study related devices (such as the hand-held PRO instrument being used by patients in our HOPE Study) to the clinical sites and patients; |
• | delays in having patients enroll or complete participation in a study in accordance with applicable protocols or protocol amendments, or return for post-treatment follow-up; |
• | reduction in the number of participating clinical trial sites or patients, including by dropping out of a trial; |
• | failure to address in an adequate or timely manner any patient safety concerns that arise during the course of a trial; |
• | unanticipated costs or increases in costs of clinical trials of our product candidates; |
• | the occurrence of serious adverse events or other safety concerns associated with our product candidates; or |
• | changes in regulatory requirements and guidance that require amending or submitting new clinical protocols or obtaining additional IRB or other approvals to conduct or complete clinical studies of our product candidates. |
• | issue untitled or warning letters; |
• | impose civil or criminal penalties; |
• | impose injunctions; |
• | impose fines; |
• | impose additional specialized restrictions on the company’s activities and practices; |
• | suspend regulatory approval; |
• | suspend ongoing clinical trials; |
• | seek voluntary product recalls and impose publicity requirements; |
• | refuse to approve pending applications or supplements to approved applications submitted by us; |
• | impose restrictions on our operations, including closing our contract manufacturers’ facilities; or |
• | seize or detain products. |
• | reliance on the third party for regulatory compliance and quality assurance; |
• | the possible breach or termination of the manufacturing agreement by the third party or by us, including at a time that is costly or inconvenient for us; |
• | the inability of the third party to satisfy our ordering requirements as to quality, quantity and/or price; |
• | the possible misappropriation of our proprietary information, including our trade secrets and know-how; and |
• | the unwillingness of the third party to extend or renew terms with us when desired. |
• | the demonstrated efficacy and potential advantages of our drugs compared to alternative treatments; |
• | our ability to offer our drugs for sale at competitive prices; |
• | the convenience and ease of administration of our drugs compared to alternative current and future treatments; |
• | the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; |
• | the availability of our drugs and our ability to meet market demand, including a reliable supply for long-term chronic treatment; |
• | the strength of labeling, marketing and distribution support; |
• | the availability of third-party coverage and adequate reimbursement; |
• | the clinical indications and approved labeling, including any labeling restrictions in the event a product candidate is approved under Subpart H, for which the drug is approved; |
• | the prevalence and severity of any side effects and overall safety profile of the drug; and |
• | any restrictions on the use of the drug, including together with other medications. |
• | the burden of complying with complex and changing foreign regulatory, tax, accounting, compliance and legal requirements; |
• | different medical practices and customs in foreign countries affecting acceptance in the marketplace; |
• | import or export licensing requirements; |
• | longer accounts receivable collection times; |
• | longer lead times for shipping; |
• | language barriers for technical training; |
• | reduced protection of intellectual property rights in some foreign countries, and related prevalence of bioequivalent or generic alternatives to therapeutics; |
• | foreign currency exchange rate fluctuations; |
• | potential resource constraints, including with respect to patients’ ability to obtain reimbursement for our products in foreign markets; and |
• | the interpretation of contractual provisions governed by foreign laws in the event of a contract dispute. |
• | the U.S. federal Anti-Kickback Statute makes it illegal for any person, including a prescription drug manufacturer (or a party on its behalf) to knowingly and willfully solicit, offer, receive or pay any remuneration (including any kickback, bribe, or certain rebates), directly or indirectly, overtly or covertly, in cash or in kind, that is intended to induce or reward either the referral of an individual for, or the purchase, lease, order or recommendation of, any good, facility, item or service, for which payment may be made, in whole or in part, under U.S. federal healthcare programs such as Medicare and Medicaid. Violations of this law can result in criminal penalties and fines, administrative civil money penalties and exclusion from participation in federal healthcare programs. A person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation, and some federal courts have adopted very broad readings of the potential for violations of the statute; |
• | the U.S. federal false claims and civil monetary penalties laws, including the civil False Claims Act, which, among other things, impose criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities (including manufacturers) knowingly presenting, or causing to be presented false or fraudulent claims for payment by a federal healthcare program or making a false statement or record material to payment of a false claim or avoiding, decreasing or concealing an obligation to pay money to the federal government. Penalties for a False Claims Act violation include three times the actual damages sustained by the government, plus mandatory civil penalties, the potential for exclusion from participation in federal healthcare programs and the potential implication of various federal criminal statutes. The government may deem manufacturers to have “caused” the submission of false or fraudulent claims by, for example, providing inaccurate billing or coding information to customers or promoting a product off-label. Claims which include items or services resulting from a violation of the federal Anti-Kickback Statute are false or fraudulent claims for purposes of the False Claims Act, and activities relating to the reporting of wholesaler or estimated retail prices, the reporting of prices used to calculate Medicaid rebate information and other information affecting federal, state and third-party product reimbursement are subject to scrutiny under this law. The civil False Claims Act has been used to assert liability on the basis of, among other things, kickbacks and other improper referrals, improperly reported government pricing metrics such as Best Price or Average Manufacturer Price causing underpayment of rebates, improper use of Medicare provider or supplier numbers when detailing a provider of services, improper promotion (e.g. of off-label uses not expressly approved by the FDA in a product’s label), and allegations as to misrepresentations with respect to the services rendered. Intent to deceive is not required to establish liability under the civil False Claims Act. Over time, False Claims Act lawsuits against biopharmaceutical companies have increased significantly in volume and breadth, leading to multiple substantial civil and criminal settlements regarding sales practices and promoting off label uses. Further, the government may further prosecute conduct constituting a false claim under the criminal False Claims Act; |
• | the U.S. federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal and civil liability for, among other things, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private payors, knowingly and willfully embezzling or stealing from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, or knowingly and |
willfully falsifying, concealing or covering up a material fact or making any materially false statement, in connection with the delivery of, or payment for, healthcare benefits, items or services; similar to the U.S. federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation; |
• | HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 and their respective implementing regulations, which imposes, among other things, specified requirements on covered entities and their business associates relating to the privacy, security and transmission of individually identifiable health information, including mandatory contractual terms and required implementation of technical safeguards of such information. HITECH also created new tiers of civil monetary penalties, amended HIPAA to make civil and criminal penalties applicable to business associates, and gave state attorneys general new authority to file civil actions for damage or injunctions in federal courts to enforce the federal HIPAA laws and seek attorneys’ fees and costs associated with pursuing federal civil actions; |
• | the U.S. Federal Food, Drug and Cosmetic Act, which prohibits, among other things, the adulteration or misbranding of drugs, biologics and medical devices; |
• | the U.S. federal legislation commonly referred to as Physician Payments Sunshine Act, enacted as part of the ACA, as amended by the Education Reconciliation Act of 2010 and its implementing regulations, which requires certain manufacturers of drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid, or the Children’s Health Insurance Program to report annually to the CMS information related to certain payments and other transfers of value to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, as well as ownership and investment interests held by the physicians described above and their immediate family members; |
• | payment or reimbursement of prescription therapeutics by Medicaid or Medicare requires manufacturers to submit pricing information to CMS. The Medicaid Drug Rebate statute requires manufacturers to calculate and report price points, which are used to determine Medicaid rebate payments shared between the states and the federal government and Medicaid payment rates for certain therapeutics. For therapeutics paid under Medicare Part B, manufacturers must also calculate and report their Average Sales Price, which is used to determine the Medicare Part B payment rate. Many products are subject to an additional inflation penalty which can substantially increase rebate payments. In addition, the Veterans Health Care Act, or VHCA, requires manufacturers of drugs and biologics to calculate and report a different price to the Veterans Administration, or VA, which is used to determine the maximum price that can be charged to certain federal agencies, and includes an inflation penalty. All of these detailed and complex price reporting requirements create risk of submitting false information to the government, and potential for liability including under the False Claims Act; |
• | the VHCA also requires manufacturers of covered therapeutics participating in the Medicaid program to enter into Federal Supply Schedule contracts with the VA through which their covered therapeutics must be sold to certain federal agencies at the price reported to the VA. This necessitates compliance with applicable federal procurement laws and regulations, including submission of commercial sales and pricing information, and subjects manufacturers to contractual remedies as well as administrative, civil, and criminal sanctions. In addition, the VHCA requires manufacturers participating in Medicaid to agree to provide different mandatory discounts to certain Public Health Service grantees and other safety net hospitals and clinics under the 340B program based on the manufacturer’s reported Medicaid pricing information. The 340B program has its own regulatory authority to impose sanctions for non-compliance; |
• | analogous state laws and regulations, including: state anti-kickback and false claims laws, which may be broader in scope and apply regardless of payor; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S. federal government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws and regulations that require drug manufacturers to file reports relating to pricing and marketing information, which requires tracking gifts and other remuneration and items of value provided to healthcare professionals and entities; and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts; |
• | the Foreign Corrupt Practices Act, or FCPA, prohibits any U.S. individual or business from paying, offering, or authorizing payment or offering of anything of value, directly or indirectly, to any foreign official, political party, or candidate for the purpose of influencing any act or decision of the foreign entity in order to assist the individual or business in obtaining or retaining business. The FCPA also obligates companies whose securities are listed in the United States to comply with accounting provisions requiring the company to maintain books and records that accurately and fairly reflect all transactions of the corporation, including international subsidiaries, and to devise and maintain an adequate system of internal accounting controls for international operations. Activities that violate the FCPA, even if they occur wholly outside the United States, can result in criminal and civil fines, imprisonment, disgorgement, oversight, and debarment from government contracts; and |
• | European and other foreign law equivalents of each of the laws, including reporting requirements detailing interactions with and payments to healthcare providers. |
• | an annual, nondeductible fee on any entity that manufactures or imports certain branded prescription drugs and biologic agents, which is apportioned among these entities according to their market share in certain government healthcare programs; |
• | an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program to 23.1% and 13% of the average manufacturer price for branded and generic drugs, respectively; |
• | a new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% point-of-sale discounts to negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D; |
• | extension of manufacturers’ Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations, unless the drug is subject to discounts under the 340B drug discount program; |
• | a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected; |
• | expansion of eligibility criteria for Medicaid programs by, among other things, allowing states to offer Medicaid coverage to additional individuals and by adding new mandatory eligibility categories for certain individuals with income at or below 133% of the federal poverty level, thereby potentially increasing manufacturers’ Medicaid rebate liability; |
• | expansion of healthcare fraud and abuse laws, including the False Claims Act and the Anti-Kickback Statute, new government investigative powers, and enhanced penalties for noncompliance; |
• | expansion of the entities eligible for discounts under the Public Health Service pharmaceutical pricing program; |
• | new requirements under the federal Physician Payments Sunshine Act for drug manufacturers to report information related to payments and other transfers of value made to physicians and teaching hospitals as well as ownership or investment interests held by physicians and their immediate family members; |
• | a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research; |
• | establishment of a Center for Medicare and Medicaid Innovation at CMS to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending; and |
• | aggregate reductions to Medicare Part B payments to providers of up to 2% per fiscal year, which became effective on April 1, 2013 and will remain in effect through 2027 unless additional congressional action is taken. |
• | the research methodology used may not be successful in identifying potential product candidates; |
• | competitors may develop alternatives that render our product candidates obsolete or less attractive; |
• | product candidates we develop may nevertheless be covered by third parties’ patents or other exclusive rights; |
• | the market for a product candidate may change during our program so that such a product may become unreasonable to continue to develop; |
• | a product candidate may on further study be shown to have harmful side effects, lack of potential efficacy or other characteristics that indicate it is unlikely to meet applicable regulatory criteria or remain reasonable to continue to develop; |
• | a product candidate may not be capable of being produced in commercial quantities at an acceptable cost, or at all; and |
• | a product candidate may not be accepted as safe and effective by patients, the medical community or third-party payors, if applicable. |
• | impairment of our business reputation; |
• | withdrawal of clinical trial participants; |
• | costs due to related litigation; |
• | distraction of management’s attention from our primary business; |
• | substantial monetary awards to patients or other claimants; |
• | increased warnings on product labels or additional restrictions imposed by regulatory authorities; |
• | the recall of our product candidates; |
• | the inability to commercialize our product candidates; and |
• | decreased demand for our product candidates, if approved for commercial sale. |
• | restrictions and obligations imposed by privacy regulations, such as provisions under the General Data Protection Regulation 2016/679, known as GDPR, applicable to the collection and use of personal health data in the European Union; |
• | multiple, conflicting, and changing laws and regulations such as tax laws, export and import restrictions, employment laws, regulatory requirements, and any requirements to obtain other governmental approvals, permits, and licenses; |
• | failure by us to obtain and maintain regulatory approvals for the sale or use of our products in various countries; |
• | additional potentially relevant third-party patent rights; |
• | complexities and difficulties in obtaining protection for and enforcing our intellectual property; |
• | difficulties in staffing and managing foreign operations; |
• | complexities associated with managing multiple payor reimbursement regimes, government payors, or patient self-pay systems; |
• | limits in our ability to penetrate international markets; |
• | financial risks, such as longer payment cycles, difficulty collecting accounts receivable, the impact of local and regional financial crises on demand and payment for our products, and exposure to foreign currency exchange rate fluctuations; |
• | natural disasters, political and economic instability, including wars, terrorism, and political unrest, outbreak of disease, boycotts, curtailment of trade, and other business restrictions; |
• | certain expenses including, among others, expenses for travel, translation, and insurance; and |
• | regulatory and compliance risks that relate to maintaining accurate information and control over sales and activities that may fall within the purview of the FCPA, its books and records provisions, or its anti-bribery provisions. |
• | comply with EMA or FDA regulations or similar regulations of comparable foreign regulatory authorities; |
• | provide accurate information to the FDA or EMA or comparable foreign regulatory authorities; |
• | comply with cGMP regulations and manufacturing standards that we have established and comply with applicable healthcare fraud and abuse regulations in the jurisdictions in which we operate; |
• | report financial information or data accurately; or |
• | disclose unauthorized activities to us. |
• | adverse results or delays in, or the halting of, our nonclinical studies or clinical trials, especially in our ongoing or future clinical program for voxelotor for the treatment of SCD; |
• | reports of adverse events in our clinical program for voxelotor for SCD, or other indications that we may pursue, or clinical trials of any other product candidates that we may develop; |
• | any delay in our planned filing of an NDA, including under Subpart H, for voxelotor or an investigational new drug application, or IND, or NDA for inclacumab or for any other product candidates that we may develop and any adverse development or perceived adverse development with respect to the FDA’s review of that IND or NDA; |
• | failure to develop successfully and commercialize voxelotor, inclacumab or any other product candidates that we may develop; |
• | adverse regulatory decisions affecting voxelotor, inclacumab or any other product candidates we may develop, including any delay in or denial of potential approval in accordance with our plans and expectations; |
• | inability to obtain additional funding; |
• | failure to prosecute, maintain or enforce our intellectual property rights; |
• | disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our technologies; |
• | changes in laws or regulations applicable to future products; |
• | inability to obtain adequate product supply for our product candidates or the inability to do so at acceptable prices; |
• | introduction of new products, services or technologies by our competitors; |
• | failure to enter into or perform under strategic collaborations; |
• | failure to meet or exceed any financial projections that we or the investment community may provide; |
• | the perception of the pharmaceutical industry by the public, legislatures, regulators and the investment community; |
• | announcements of significant acquisitions, strategic partnerships, joint ventures or capital commitments by us or our competitors; |
• | additions or departures of key scientific or management personnel; |
• | significant lawsuits, including patent or stockholder litigation; |
• | changes in the market valuations of similar companies; |
• | sales of our common stock by us or our stockholders in the future; |
• | trading volume of our common stock; and |
• | the other risks described in this “Risk Factors” section. |
• | the timing and cost of, and level of investment in, research and development activities relating to our product candidates, which may change from time to time; |
• | the timing and success or failure of clinical trials for our product candidates or competing product candidates, or any other change in the competitive landscape of our industry, including consolidation among our competitors or partners; |
• | our ability to obtain regulatory approval for our product candidates, and the timing and scope of any such approvals we may receive; |
• | our ability to commercialize any of our product candidates, if approved, and the timing and costs of our commercialization activities; |
• | the cost of manufacturing our product candidates, which may vary depending on the quantity of production and the terms of our agreements with manufacturers; |
• | our ability to attract, hire and retain qualified personnel; |
• | expenditures that we will or may incur to acquire or develop additional product candidates and technologies; |
• | the level of demand for our product candidates, should they receive approval, which may vary significantly; |
• | future accounting pronouncements or changes in our accounting policies; |
• | the risk/benefit profile, cost and reimbursement policies with respect to our products candidates, if approved, and existing and potential future drugs that compete with our product candidates; |
• | whether any of our product candidates are subject to any compliance-related challenges or sanctions, or any intellectual-property related challenges; and |
• | the changing and volatile U.S., European and global economic environments. |
• | authorize “blank check” preferred stock, which could be issued by our board of directors without stockholder approval and may contain voting, liquidation, dividend and other rights superior to our common stock; |
• | create a classified board of directors whose members serve staggered three-year terms; |
• | specify that special meetings of our stockholders can be called only by our board of directors, the chairperson of our board of directors, our chief executive officer or our president; |
• | prohibit stockholder action by written consent; |
• | establish an advance notice procedure for stockholder approvals to be brought before an annual meeting of our stockholders, including proposed nominations of persons for election to our board of directors; |
• | provide that our directors may be removed only for cause; |
• | provide that vacancies on our board of directors may be filled only by a majority of directors then in office, even though less than a quorum; |
• | specify that no stockholder is permitted to cumulate votes at any election of directors; |
• | expressly authorize our board of directors to modify, alter or repeal our amended and restated bylaws; and |
• | require supermajority votes of the holders of our common stock to amend specified provisions of our amended and restated certificate of incorporation and amended and restated bylaws. |
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds |
a) | Sales of Unregistered Securities |
b) | Use of Proceeds from our Initial Public Offering of Common Stock |
c) | Repurchases of Shares or of Company Equity Securities |
Item 3. |
Defaults Upon Senior Securities |
Item 4. |
Mine Safety Disclosures |
Item 5. |
Other Information |
Item 6. |
Exhibits |
Exhibit Number |
Exhibit Description |
Incorporated by Reference |
Filed Herewith |
|||||||||||||||||
Form |
Date |
Number |
||||||||||||||||||
3.1 |
S-1/A |
7/31/2015 |
3.2 |
|||||||||||||||||
3.2 |
S-1/A |
7/31/2015 |
3.4 |
|||||||||||||||||
4.1 |
S-1/A |
7/31/2015 |
4.1 |
|||||||||||||||||
10.1# |
X |
|||||||||||||||||||
31.1 |
X |
|||||||||||||||||||
31.2 |
X |
|||||||||||||||||||
32.1* |
X |
|||||||||||||||||||
101.SCH |
Inline XBRL Taxonomy Extension Schema Document |
X |
||||||||||||||||||
101.CAL |
Inline XBRL Taxonomy Extension Calculation Linkbase Document |
X |
||||||||||||||||||
101.DEF |
Inline XBRL Taxonomy Extension Definition Linkbase Document. |
X |
||||||||||||||||||
101.LAB |
Inline XBRL Taxonomy Extension Label Linkbase Document. |
X |
||||||||||||||||||
101.PRE |
Inline XBRL Taxonomy Extension Presentation Linkbase Document. |
X |
||||||||||||||||||
104 |
Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101.) |
X |
# | Represents management compensation plan, contract or arrangement. |
* | The certification attached as Exhibit 32.1 that accompanies this Quarterly Report on Form 10-Q 10-Q, irrespective of any general incorporation language contained in such filing. |
Global Blood Therapeutics, Inc. | ||||||
Date: August 7, 2019 |
By: |
/s/ Ted W. Love, M.D. | ||||
Ted W. Love, M.D. President and Chief Executive Officer (Principal Executive Officer) | ||||||
Date: August 7, 2019 |
By: |
/s/ Jeffrey Farrow | ||||
Jeffrey Farrow Chief Financial Officer (Principal Financial Officer) |
Exhibit 10.1
June 17, 2019
Eric Fink
Dear Eric,
Global Blood Therapeutics, Inc. (the Company) is pleased to offer you employment on the following terms:
1. | Position. Your initial title will be Chief Human Resources Officer, and you will report to Ted Love, Chief Executive Officer. This is a full-time position. While you render services to the Company, you will not engage in any other employment, consulting or other business activity (whether full-time or part-time) that would create a conflict of interest with the Company. By signing this letter agreement, you confirm to the Company that you have no contractual commitments or other legal obligations that would prohibit you from performing your duties for the Company. |
2. | Cash Compensation. The Company will pay you a starting salary at the rate of $330,000 per year, payable in accordance with the Companys standard payroll schedule. This salary will be subject to adjustment pursuant to the Companys employee compensation policies in effect from time to time. In addition to your salary, you will be eligible to participate in the Annual Performance-Based Cash Incentive Award Program which is based on the achievement of Company performance goals and your personal goals to be set with your manager. Your initial bonus target will be 35% of your annual base salary. |
3. | Employee Benefits. As a regular employee of the Company, you will be eligible to participate in a number of Company-sponsored benefits. Should you decide to participate in the Company health benefits program, your coverage will begin the first day of the month following your start date. In addition, you will be entitled to 20 days of paid time off in accordance with the Companys policy. |
4. | Equity. Subject to the approval of the Companys Compensation Committee or its designee, you will be granted an option to purchase 38,000 shares of the Companys Common Stock. The option will be subject to the terms and conditions applicable to options granted under the Companys 2017 Inducement Equity Plan (the 2017 Plan), as described in the Plan and the applicable stock option agreement. The exercise price per share will be determined when the option is granted. You will vest in 25% of the option shares after 12 months of continuous service, and the balance will vest in equal quarterly installments of 6.25% per quarter over the next 36 months of continuous service, as described in the applicable stock option agreement. In addition, subject to the approval of the Companys Compensation Committee or its designee, you will be granted 25,000 Restricted Stock Units (RSUs) of the Companys Common Stock. The award of RSUs will be subject to the terms and conditions applicable to RSU awards granted under the 2017 Plan, as described in the Plan and the applicable RSU award agreement. You will vest in 25% of the RSU shares after 12 months of continuous service from the vesting start date specified in the RSU award agreement, and the balance will vest in equal six-month installments (of 12.5% per installment) over the next 36 months of continuous service, as described in the applicable RSU award agreement. |
5. | Travel Stipend; Relocation Assistance. The Company will pay you a travel stipend of $12,000 per month, subject to applicable payroll deductions and tax withholdings, to cover travel expenses in connection with your employment (the Travel Stipend) until the earlier to occur of (a) 12 months after your start date with the Company and (b) the permanent relocation of your primary residence to the Bay Area in Northern California (the Relocation). The Travel Stipend payments are subject to you being actively employed and in good standing with the Company on the date of each payment and will discontinue if your employment is terminated for any reason. |
6. | Signing Bonus. Global Blood Therapeutics will provide you with a one-time signing bonus of $150,000. You will receive this payment during your first month of employment and it will be subject to customary deductions and withholdings as required by law. Should you voluntarily leave the company within two years of receiving this payment, you will be obligated to return the gross amount of the payment to the Company within 30 days of your separation date. |
7. | Change in Control. You will be eligible to participate in the Companys Change in Control Policy. In accordance with the policys terms, which the Company retains the right to amend, revise, change or end at any time, if your employment is terminated without Cause (as defined in the Plan) within one year after the closing of a Sale Event (as defined in the Plan), you will receive certain benefits provided that you first execute and not revoke a severance agreement including a general release of claims. Currently those benefits are: (a) full acceleration of vesting of your outstanding equity awards under the Companys equity plan applicable to your equity awards (as set forth in the applicable plan): (b) a lump sum equal to one year of your base salary; (c) a lump sum equal to your then-current target bonus; and (d) if you are participating in the Company group health plan immediately prior to termination and you elect COBRA, a monthly cash payment for one year equal to the Companys monthly premium contribution. This section is not intended to modify the Change in Control Policy and is provided merely as an introductory summary of the policys current terms. A copy of the Change in Control Policy will be available from Human Resources upon request after your start date. |
8. | Severance. If your employment is terminated by the company without Cause (as defined in the Plan) and (i) the date of termination occurs on or before the first anniversary of the first date of your employment (the First Anniversary); (ii) you are not entitled to severance benefits under the CIC Plan or any other contract or agreement: (iii) you enter into, do not revoke and comply with a severance agreement in a form acceptable to the Company, which shall include a general release of claims in favor of the Company and related persons and entities, then you will receive the following severance benefits: (a) a lump sum equal to six months of your annual base salary; and (b) if you are participating in the Company group health plan immediately prior to termination and you elect COBRA, a monthly cash payment for six months equal to the Companys monthly premium contribution for active employees. If your employment is terminated for any reason on or after the First Anniversary, then you will not be eligible for the foregoing severance benefits. |
9. | Employee Confidentiality and Assignment Agreement. Like all Company employees, you will be required, as a condition of your employment with the Company, to sign the Companys standard Employee Confidentiality and Assignment Agreement, a copy of which is attached hereto as Exhibit A. |
10. | Background Check. The Company may conduct a background or reference check (or both). If so, then you agree to cooperate fully in those procedures, and this offer is subject to the Companys approving the outcome of those checks, in the discretion of the Company. |
11. | Employment Relationship. Employment with the Company is for no specific period of time. Your employment with the Company will be at will, meaning that either you or the Company may terminate your employment at any time and for any reason, with or without cause. Any contrary representations that may have been made to you are superseded by this letter agreement. This is the full and complete agreement between you and the Company on this term. Although your job duties, title, reporting relationship, compensation and benefits, as well as the Companys personnel policies and procedures, may change from time to time, the at will nature of your employment may only be changed in an express written agreement signed by both you and a duly authorized officer of the Company. |
12. | Taxes. All forms of compensation referred to in this letter agreement are subject to reduction to reflect applicable withholding and payroll taxes and other deductions required by law. You agree that the Company does not have a duty to design its compensation policies in a manner that minimizes your tax liabilities, and you will not make any claim against the Company or its Board of Directors related to tax liabilities arising from your compensation. |
13. | Interpretation, Amendment and Enforcement. This letter agreement and Exhibit A constitute the complete agreement between you and the Company, contain all of the terms of your employment with the Company and supersede any prior agreements, representations or understandings (whether written, oral or implied) between you and the Company. This letter agreement may not be amended or modified, except by an express written agreement signed by both you and a duly authorized officer of the Company. The terms of this letter agreement and the resolution of any disputes as to the meaning, effect, performance or validity of this letter agreement or arising out of, related to, or in any way connected with, this letter agreement, your employment with the Company or any other relationship between you and the Company will be governed by California law, excluding laws relating to conflicts or choice of law. |
*****
We hope that you will accept our offer to join the Company. You may indicate your agreement with these terms and accept this offer by signing this employment agreement and the enclosed Employee Confidentiality and Assignment Agreement and returning them to me. This offer, if not accepted, will expire at 5:00pm on June 24, 2019. As required by law, your employment with the Company is contingent upon your providing legal proof of your identity and authorization to work in the United States, and approved of the offer terms by the Companys compensation committee. Your employment is also contingent upon your starting work with the Company on August 5, 2019.
If you have any questions, please call me at 650.741.7710.
Very truly-yours,
/s/ Ted W. Love
Ted Love
President and Chief Executive Officer
GLOBAL BLOOD THERAPEUTICS, INC.
/s/ Eric Fink |
Eric Fink |
Dated: June 18, 2019
Attachment
Exhibit A: Employee Confidentiality and Assignment Agreement
Exhibit 31.1
CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER
PURSUANT TO RULES 13a-14(a) AND 15d-14(a) OF THE SECURITIES EXCHANGE ACT, AS ADOPTED
PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Ted W. Love, certify that:
1. | I have reviewed this Quarterly Report on Form 10-Q of Global Blood Therapeutics, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: August 7, 2019 |
/s/ Ted W. Love, M.D. |
Ted W. Love, M.D. President and Chief Executive Officer (Principal Executive Officer) |
Exhibit 31.2
CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER
PURSUANT TO RULES 13a-14(a) AND 15d-14(a) OF THE SECURITIES EXCHANGE ACT, AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Jeffrey Farrow, certify that:
1. | I have reviewed this Quarterly Report on Form 10-Q of Global Blood Therapeutics, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: August 7, 2019 |
/s/ Jeffrey Farrow |
Jeffrey Farrow Chief Financial Officer (Principal Financial Officer) |
Exhibit 32.1
GLOBAL BLOOD THERAPEUTICS, INC.
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Global Blood Therapeutics, Inc. (the Company) on Form 10-Q for the quarter ended June 30, 2019, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Ted W. Love, President and Chief Executive Officer of the Company, and Jeffrey Farrow, Chief Financial Officer, do each hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Ted W. Love, M.D. |
Ted W. Love, M.D. President and Chief Executive Officer (Principal Executive Officer) |
August 7, 2019 |
/s/ Jeffrey Farrow |
Jeffrey Farrow Chief Financial Officer (Principal Financial Officer) |
August 7, 2019
This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Global Blood Therapeutics, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares |
Jun. 30, 2019 |
Dec. 31, 2018 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 59,906,199 | 55,640,299 |
Common stock, shares outstanding | 59,906,199 | 55,640,299 |
Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Operating expenses: | ||||
Research and development | $ 36,010 | $ 31,573 | $ 70,476 | $ 61,517 |
General and administrative | 24,794 | 10,914 | 42,849 | 23,665 |
Total operating expenses | 60,804 | 42,487 | 113,325 | 85,182 |
Loss from operations | (60,804) | (42,487) | (113,325) | (85,182) |
Other income (expense): | ||||
Interest income, net | 3,546 | 2,115 | 7,196 | 3,287 |
Other income (expenses), net | (63) | 4 | (115) | (29) |
Total other income, net | 3,483 | 2,119 | 7,081 | 3,258 |
Net loss | (57,321) | (40,368) | (106,244) | (81,924) |
Other comprehensive loss: | ||||
Net unrealized gain on marketable securities, net of tax | 615 | 82 | 1,239 | 94 |
Comprehensive loss | $ (56,706) | $ (40,286) | $ (105,005) | $ (81,830) |
Basic and diluted net loss per common share | $ (1.01) | $ (0.78) | $ (1.88) | $ (1.65) |
Weighted-average number of shares used in computing basic and diluted net loss per common share | 56,539,760 | 51,742,904 | 56,386,560 | 49,767,633 |
Organization and Basis of Presentation |
6 Months Ended |
---|---|
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | 1. Organization and Basis of Presentation Global Blood Therapeutics, Inc. (the “Company”, “we”, “us”, and “our”) was incorporated in Delaware in February 2011 and commenced operations in May 2012. We are a clinical-stage biopharmaceutical company determined to discover, develop and deliver innovative treatments that provide hope to underserved patient communities. Our primary activities have been establishing our facilities, recruiting personnel, preparing for commercialization, conducting development of our product candidates, including clinical trials, and raising capital. Our principal operations are based in South San Francisco, California, and we operate in one segment. Follow-on Offerings In December 2018, we completed a follow-on offering and issued 3,409,090 shares of common stock at a price of $41.54 per share with proceeds of $141.1 million net of underwriting costs and commissions and offering expenses. In addition, in January 2019, we sold an additional 511,363 shares of our common stock directly to the underwriters when they exercised their over-allotment option at the price of $41.54 per share for proceeds of $21.2 million net of underwriting costs and commissions.In June 2019, we completed a follow-on offering and issued 3,375,527 shares of common stock at a price of $57.12 per share with proceeds of $192.1 million net of underwriting costs and commissions, and estimated offering expenses. In addition, in July 2019, we sold an additional 100,000 shares of our common stock directly to the underwriters when they exercised their over-allotment option at the price of $57.12 per share for proceeds of $5.7 million net of underwriting costs and commissions.Need for Additional Capital In the course of our development activities, we have sustained operating losses and we expect such losses to continue over the next several years. Our ultimate success depends on the outcome of our research and development activities. Since inception through June 30, 2019, we have incurred cumulative net losses of $578.4 million. We expect to incur additional losses in the future to conduct product research and development and we recognize the need to raise additional capital to fully implement our business plan. We intend to raise such capital through the issuance of additional equity, and potentially through borrowings, and strategic alliances with partner companies. However, if such financing is not available at adequate levels, we will need to
re-evaluate our operating plans. We believe that our existing cash and cash equivalents and marketable securities will be sufficient to fund our cash requirements for at least twelve months subsequent to the issuance of these financial statements. |
Summary of Significant Accounting Policies |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Preparation The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP have been condensed or omitted, and accordingly the balance sheet as of December 31, 2018 has been derived from audited consolidated financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. These unaudited interim condensed consolidated financial statements have been prepared on the same basis as our annual consolidated financial statements and, in the opinion of management, reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair presentation of our financial information. The results of operations for the three and six months ended June 30, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019 or for any other interim period or for any other future year. The accompanying unaudited interim condensed consolidated financial statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2018 included in our Annual Report on Form 10-K, filed with the SEC on February 27, 2019.Use of Estimates The preparation of the accompanying consolidated financial statements in accordance with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of costs and expenses during the reporting period. We base our estimates and assumptions on historical experience when available and on various factors that we believe to be reasonable under the circumstances. We evaluate our estimates and assumptions on an ongoing basis. Our actual results could differ from these estimates under different assumptions or conditions. 7 Principles of Consolidation The accompanying unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation. Significant Accounting Policies Except as noted below, there have been no material revisions in our significant accounting policies described in Note 2 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018.Leases Leases (Topic 842) Effective January 1, 2019 We determine if an arrangement is or contains a lease at inception by assessing whether the arrangement contains an identified asset and whether we have the right to control the identified asset. Right-of-use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Lease liabilities are recognized at the lease commencement date based on the present value of future lease payments over the lease term. ROU assets are based on the measurement of the lease liability and also include any lease payments made prior to or on lease commencement and exclude lease incentives received and initial direct costs incurred, as applicable.As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. We give consideration to our credit risk, term of the lease, total lease payments and adjust for the impacts of collateral, as necessary, when calculating our incremental borrowing rates. The lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise any such options. Lease cost for our operating leases is recognized on a straight-line basis over the lease term. We have elected to not separate lease and non-lease components for any leases within its existing classes of assets and, as a result, account for any lease and non-lease components as a single lease component. We have also elected to not recognize any leases within its existing classes of assets with a term of 12 months or less.Leases (Topic 840) Prior to the Adoption of Topic 842 We enter into lease agreements for our office and laboratory facilities. These leases are classified as operating leases. Rent expense is recognized on a straight-line basis over the noncancelable term of the lease and, accordingly, we record the difference between cash rent payments and the recognition of rent expense as a deferred rent liability, which is included within other liabilities on the consolidated balance sheet. Incentives granted under our facilities leases, including rent holiday and allowances to fund leasehold improvements, are deferred and are recognized as adjustments to rental expense on a straight-line basis over the noncancelable term of the lease. Accounting Pronouncements Adopted Leases (Topic 842) In February 2016 the Financial Accounting Standards Board issued Accounting Standards Update 2016-02, Leases (“Topic 842” or “ASU 2016-02”). ASU 2016-02 amends a number of aspects of lease accounting, including requiring lessees to recognize almost all leases with a term greater than one year as a ROU asset and corresponding liability, measured at the present value of the lease payments. On January 1, 2019, we adopted Topic 842 using the modified retrospective approach as of the adoption date. Results for the three and six months ended June 30, 2019 are presented under Topic 842. No prior period amounts were adjusted and continue to be reported in accordance with previous lease guidance, Accounting Standards Codification Topic 840, Leases (“Topic 840”).The new standard provides a number of optional practical expedients in transition. We elected the practical expedients to not reassess its prior conclusions about lease identification under the new standard, to not reassess lease classification, and to not reassess initial direct costs. We did not elect the practical expedient allowing the use-of-hindsight which would require us to reassess the lease term of its leases based on all facts and circumstances through the effective date and did not elect the practical expedient pertaining to land easements as this is not applicable to our current contract portfolio.8 The impact of our adoption of Topic 842 on the accompanying consolidated balance sheet as of January 1, 2019 was as follows (in thousands):
The adjustments due to our adoption of Topic 842 related to the recognition of ROU assets and lease liabilities for the existing operating leases. A cumulative-effect adjustment to beginning retained earnings was not required. |
Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | 3. Fair Value Measurements Fair value accounting is applied for all financial assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis (at least annually). Our financial instruments consist of cash and cash equivalents, marketable securities, restricted cash, accounts payable and accrued liabilities. Cash and cash equivalents, marketable securities and restricted cash are reported at their respective fair values on our condensed consolidated balance sheets. The remaining financial instruments are reported on our condensed consolidated balance sheets at cost that approximate current fair values due to their relatively short maturities. Assets and liabilities recorded at fair value on a recurring basis in the condensed consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair values. Fair value is defined as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The authoritative guidance on fair value measurements establishes a three-tier fair value hierarchy for disclosure of fair value measurements as follows: Level Level Level The following table summarizes our financial assets measured at fair value on a recurring basis (in thousands):
We estimate the fair values of our investments in corporate debt securities, government and government related securities and certificates of deposits by taking into consideration valuations obtained from third-party pricing services. The fair value of our marketable securities classified within Level 2 is based upon observable inputs that may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads,
two-sided markets, benchmark securities, bids, offers and reference data including market research publications. At June 30, 2019 and December 31, 2018, the weighted average remaining contractual maturities of our Level 2 investments was less than one year and all of these investments are rated A-1/P-1/F1 or A/A2, or higher by Moody’s and S&P. There were no transfers between Level 1 and Level 2 during the periods presented. |
Available-for-Sale Securities |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Available-for-Sale Securities | 4. Available-for-Sale Securities Estimated fair values of
available-for-sale securities are generally based on prices obtained from commercial pricing services. The following table is a summary of available-for-sale securities recorded in cash and cash equivalents, restricted cash, or marketable securities in our condensed consolidated balance sheets (in thousands):
The following table summarizes the classification of the
available-for-sale securities on our condensed consolidated balance sheets (in thousands):
We do not intend to sell the investments that are in an unrealized loss position, and it is unlikely that we will be required to sell the investments before recovery of their amortized cost basis, which may be maturity. We have determined that the gross unrealized losses on our marketable securities were temporary in nature during the periods presented. |
Balance Sheet Components |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance Sheet Components | 5. Balance Sheet Components Property and Equipment Property and equipment consists of the following (in thousands):
Accrued liabilities Accrued liabilities consist of the following (in thousands):
Other liabilities, current and noncurrent Other liabilities consist of the following (in thousands):
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Stock Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Based Compensation | 6. Stock-Based Compensation We have three stock-based compensation plans – the Amended and Restated 2017 Inducement Equity Plan (the “2017 Inducement Plan”), the 2015 Stock Option and Incentive Plan (the “2015 Plan”) and the 2012 Stock Option and Grant Plan (the “2012 Plan”). As of June 30, 2019, there were 418,150 shares reserved under the 2017 Inducement Plan and 3,626,901 shares reserved under the 2015 Plan for the future issuance of equity awards. Upon adoption of the 2015 Plan in July 2015, no new awards or grants are permitted under the 2012 Plan. See Note 7 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2018 for additional information related to these stock-based compensation plans.Stock Options The following summarizes option activity under the 2017 Inducement Plan, 2015 Plan and 2012 Plan:
The fair values of stock options granted to employees were calculated using the following assumptions:
Restricted Stock Units The following table summarizes activity of restricted stock units ( “RSUs”) granted to employees with service-based vesting under the 2017 Inducement Plan and 2015 Plan and related information:
Stock-Based Compensation Expense Total stock-based compensation recognized by function was as follows (in thousands):
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Net Loss per Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Loss per Share | 7. Net Loss per Share Basic net loss per share is computed by dividing net loss by the weighted-average number of common shares outstanding for the period. Since we were in a loss position for all periods presented, diluted net loss per share is the same as basic net loss per share for all periods as the inclusion of all potential common shares outstanding would have been anti-dilutive. 12 The following securities were not included in the diluted net loss per share calculations because their effect was anti-dilutive:
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Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | 8. Commitments and Contingencies Leases We have operating leases for our headquarters, where we have office and research and development laboratory facilities, and equipment. Our leases have remaining lease terms of 1 to 10 years. Most of these leases require monthly lease payments that may be subject to annual increases throughout the lease term. Certain of these leases include renewal options at the election of us, with renewal terms that can extend the lease term from 1 to 10 years. These optional periods have not been considered in the determination of the ROU assets or lease liabilities associated with these leases as we did not consider it reasonably certain that we would exercise the options. For the three months ended June 30, 2019, we incurred $1.4 million of lease costs included in operating expenses in the consolidated statement of operations in relation to these operating leases, of which $0.4 million was variable lease cost and not included within the measurement of our operating lease ROU assets and operating lease liabilities. For the six months ended June 30, 2019, we incurred $3.3 million of lease costs included in operating expenses in the consolidated statement of operations in relation to these operating leases, of which $1.3 million was variable lease cost and not included within the measurement of our operating lease ROU assets and operating lease liabilities. The variable lease cost is comprised primarily of our cost in certain research and development arrangements that contain embedded equipment, and our proportionate share of operating expenses, property taxes, and insurance in relation with our facility lease. These costs are classified as operating lease expense due to our election to not separate lease and non-lease components. Cash paid for amounts included in the measurement of operating lease liabilities for the three and six months ended June 30, 2019 were $1.1 million and $ 2.2 million respectively, and were included in net cash used in operating activities in our consolidated statements of cash flows. We assumed $25.9 million of operating lease liabilities arising from obtaining the ROU assets for the six months ended June 30, 2019. The majority of our lease costs are driven by our operating lease for our headquarters in South San Francisco, where we have office and research and development laboratory facilities. In March 2017, we entered into a noncancelable operating lease (the “Lease”) for approximately 67,185 square feet of space in South San Francisco, California (the “Existing Premises”). The date on which we became responsible for paying rent under the Lease was December 15, 2017 10-year period. Future minimum rental payments under the Lease during the 10-year term are $48.5 million in the aggregate. The Lease further provides that we are obligated to pay to the landlord certain costs, including taxes and operating expenses. The Lease term commenced in November 2017 as we gained control over physical access to the Existing Premises. We have acquired $11.1 million of leasehold improvements at our Existing Premises with the tenant inducement allowance provided under the Lease. We are required to repay $1.7 million of the tenant inducement allowance to the landlord in the form of additional monthly rent with interest applied over the term of the Lease.In August 2018, we entered into an amendment to the Lease (the “Lease Amendment”) to relocate the leased premises from the Existing Premises to a to-be-constructed-building consisting of approximately 164,150 rentable square feet of space (the “Substitute Premises”) when the Substitute Premises are ready for occupancy (the “Substitute Premises Commencement Date”). The Lease Amendment has a contractual term (the “Substitute Premises Term”) of 10 years from the Substitute Premises Commencement Date. The Lease Amendment grants us an option to extend the Lease for an additional 10 -year10-year term are $121.5 million in the aggregate. Under the Lease Amendment, we are obligated to pay to the landlord certain costs, including taxes and operating expenses. The Lease Amendment also provides a tenant inducement allowance of up to $27.9 million, of which $4.1 million, if utilized, would be repaid to the landlord in the form of additional monthly rent with interest applied. As of June 30, 2019, the Substitute Premises Term has not commenced as we did not have the right to use or control physical access to the Substitute Premises. We have capitalized $1.0 million of costs in construction-in-progress within property and equipment, net for construction of leasehold improvements at the Substitute Premises as of June 30, 2019,We intend to vacate the Existing Premises and surrender and deliver the Existing Premises to the landlord on or before the date which is sixty days after the Substitute Premises Commencement Date, upon which time we will have no further obligations with respect to the Existing Premises. Upon signing of the Lease Amendment, we re-evaluated the remaining useful life of the leasehold improvements at our Existing Premises and started to amortize the leasehold improvements over the remaining period of expected use, resulting in an acceleration of depreciation expenses for approximately $3.4 million.As of June 30, 2019, the maturities of our operating lease liabilities were as follows (in thousands):
As of June 30, 2019, the weighted average remaining lease term is 8.4 years and the weighted average discount rate used to determine the operating lease liability was 13.2%. Future annual minimum lease payments due under the Lease and Lease Amendment as of December 31, 2018 were as follows (in thousands):
Rent expense for the three months ended June 30, 2019 and 2018 was $0.9 million and $0.9 million, respectively, and for the six months ended June 30, 2019 and 2018 was $1.8 million and $1.8 million, respectively. Contingencies In the ordinary course of business, we may be subject to legal claims and regulatory actions that could have a material adverse effect on our business or financial position. We assess our potential liability in such situations by analyzing potential outcomes, assuming various litigation, regulatory and settlement strategies. If we determine a loss is probable and its amount can be reasonably estimated, we accrue an amount equal to the estimated loss. No losses and no provision for a loss contingency have been recorded to date. |
Summary of Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation | Basis of Preparation The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP have been condensed or omitted, and accordingly the balance sheet as of December 31, 2018 has been derived from audited consolidated financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. These unaudited interim condensed consolidated financial statements have been prepared on the same basis as our annual consolidated financial statements and, in the opinion of management, reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair presentation of our financial information. The results of operations for the three and six months ended June 30, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019 or for any other interim period or for any other future year. The accompanying unaudited interim condensed consolidated financial statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2018 included in our Annual Report on Form
10-K, filed with the SEC on February 27, 2019. |
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Use of Estimates | Use of Estimates The preparation of the accompanying consolidated financial statements in accordance with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of costs and expenses during the reporting period. We base our estimates and assumptions on historical experience when available and on various factors that we believe to be reasonable under the circumstances. We evaluate our estimates and assumptions on an ongoing basis. Our actual results could differ from these estimates under different assumptions or conditions. 7 |
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Principles of Consolidation | Principles of Consolidation The accompanying unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation. |
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Significant Accounting Policies | Significant Accounting Policies Except as noted below, there have been no material revisions in our significant accounting policies described in Note 2 to the consolidated financial statements included in our Annual Report on Form
10-K for the year ended December 31, 2018. |
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Leases | Leases Leases (Topic 842) Effective January 1, 2019 We determine if an arrangement is or contains a lease at inception by assessing whether the arrangement contains an identified asset and whether we have the right to control the identified asset. Right-of-use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Lease liabilities are recognized at the lease commencement date based on the present value of future lease payments over the lease term. ROU assets are based on the measurement of the lease liability and also include any lease payments made prior to or on lease commencement and exclude lease incentives received and initial direct costs incurred, as applicable.As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. We give consideration to our credit risk, term of the lease, total lease payments and adjust for the impacts of collateral, as necessary, when calculating our incremental borrowing rates. The lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise any such options. Lease cost for our operating leases is recognized on a straight-line basis over the lease term. We have elected to not separate lease and non-lease components for any leases within its existing classes of assets and, as a result, account for any lease and non-lease components as a single lease component. We have also elected to not recognize any leases within its existing classes of assets with a term of 12 months or less.Leases (Topic 840) Prior to the Adoption of Topic 842 We enter into lease agreements for our office and laboratory facilities. These leases are classified as operating leases. Rent expense is recognized on a straight-line basis over the noncancelable term of the lease and, accordingly, we record the difference between cash rent payments and the recognition of rent expense as a deferred rent liability, which is included within other liabilities on the consolidated balance sheet. Incentives granted under our facilities leases, including rent holiday and allowances to fund leasehold improvements, are deferred and are recognized as adjustments to rental expense on a straight-line basis over the noncancelable term of the lease. |
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Accounting Pronouncements Adopted | Accounting Pronouncements Adopted Leases (Topic 842) In February 2016 the Financial Accounting Standards Board issued Accounting Standards Update 2016-02, Leases (“Topic 842” or “ASU 2016-02”). ASU 2016-02 amends a number of aspects of lease accounting, including requiring lessees to recognize almost all leases with a term greater than one year as a ROU asset and corresponding liability, measured at the present value of the lease payments. On January 1, 2019, we adopted Topic 842 using the modified retrospective approach as of the adoption date. Results for the three and six months ended June 30, 2019 are presented under Topic 842. No prior period amounts were adjusted and continue to be reported in accordance with previous lease guidance, Accounting Standards Codification Topic 840, Leases (“Topic 840”).The new standard provides a number of optional practical expedients in transition. We elected the practical expedients to not reassess its prior conclusions about lease identification under the new standard, to not reassess lease classification, and to not reassess initial direct costs. We did not elect the practical expedient allowing the use-of-hindsight which would require us to reassess the lease term of its leases based on all facts and circumstances through the effective date and did not elect the practical expedient pertaining to land easements as this is not applicable to our current contract portfolio.8 The impact of our adoption of Topic 842 on the accompanying consolidated balance sheet as of January 1, 2019 was as follows (in thousands):
The adjustments due to our adoption of Topic 842 related to the recognition of ROU assets and lease liabilities for the existing operating leases. A cumulative-effect adjustment to beginning retained earnings was not required. |
Summary of Significant Accounting Policies (Tables) |
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Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Adoption of Topic 842 on Consolidated balance sheet | The impact of our adoption of Topic 842 on the accompanying consolidated balance sheet as of January 1, 2019 was as follows (in thousands):
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Fair Value Measurements (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Assets Measured on Recurring Basis | The following table summarizes our financial assets measured at fair value on a recurring basis (in thousands):
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Available-for-Sale Securities (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Available-for-Sale Securities | The following table is a summary of available-for-sale securities recorded in cash and cash equivalents, restricted cash, or marketable securities in our condensed consolidated balance sheets (in thousands):
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Summary of Classification of Available-for-Sale Securities on Consolidated Balance Sheets | The following table summarizes the classification of the
available-for-sale securities on our condensed consolidated balance sheets (in thousands):
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Balance Sheet Components (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment | Property and equipment consists of the following (in thousands):
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Accrued Liabilities | Accrued liabilities consist of the following (in thousands):
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Other Liabilities | Other liabilities consist of the following (in thousands):
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Stock Based Compensation (Tables) |
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Stock Option Activity | The following summarizes option activity under the 2017 Inducement Plan, 2015 Plan and 2012 Plan:
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Valuation Assumptions for Stock Awards | The fair values of stock options granted to employees were calculated using the following assumptions:
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Stock-based Compensation Expense Recognized | Total stock-based compensation recognized by function was as follows (in thousands):
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Restricted Stock Units [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-Vested Restricted Stock Activity | The following table summarizes activity of restricted stock units ( “RSUs”) granted to employees with service-based vesting under the 2017 Inducement Plan and 2015 Plan and related information:
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Net Loss per Share (Tables) |
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Potentially Dilutive Securities that were Not Included in Diluted Net Loss per Share Calculations | The following securities were not included in the diluted net loss per share calculations because their effect was anti-dilutive:
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Commitments and Contingencies (Tables) |
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Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Lessee, Operating Lease, Liability, Maturity | As of June 30, 2019, the maturities of our operating lease liabilities were as follows (in thousands):
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Schedule of Future Minimum Rental Payments for Operating Leases | Future annual minimum lease payments due under the Lease and Lease Amendment as of December 31, 2018 were as follows (in thousands):
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Organization and Basis of Presentation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands |
1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||
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Jul. 31, 2019 |
Jun. 30, 2019 |
Jan. 31, 2019 |
Dec. 31, 2018 |
Jun. 30, 2019 |
Mar. 31, 2019 |
Mar. 31, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
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Class of Stock [Line Items] | |||||||||
Proceeds from issuance of common stock, net of issuance costs | $ 213,989 | $ 255,119 | |||||||
Cumulative net losses | $ (578,394) | $ (472,150) | $ (578,394) | $ (578,394) | |||||
Common Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Common stock shares sold | 3,375,527 | 3,409,090 | 3,375,527 | 511,363 | 4,994,736 | ||||
Share price per share | $ / shares | $ 57.12 | $ 41.54 | $ 57.12 | $ 57.12 | |||||
Proceeds from issuance of common stock, net of issuance costs | $ 192,100 | $ 141,100 | |||||||
Common Stock [Member] | Over-Allotment Option [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Common stock shares sold | 100,000 | 511,363 | |||||||
Share price per share | $ / shares | $ 57.12 | $ 41.54 | |||||||
Proceeds from issuance of common stock, net of issuance costs | $ 5,700 | $ 21,200 |
Available-for-Sale Securities - Summary of Classification of Available-for-Sale Securities on Consolidated Balance Sheets (Detail) - USD ($) $ in Thousands |
Jun. 30, 2019 |
Dec. 31, 2018 |
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Investments, Debt and Equity Securities [Abstract] | ||
Cash and cash equivalents | $ 338,452 | $ 275,234 |
Short-term marketable securities | 320,098 | 202,177 |
Long-term marketable securities | 73,176 | 114,281 |
Total | $ 731,726 | $ 591,692 |
Balance Sheet Components - Property and Equipment (Detail) - USD ($) $ in Thousands |
Jun. 30, 2019 |
Dec. 31, 2018 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 24,434 | $ 22,888 |
Less: accumulated depreciation and amortization | (12,089) | (7,907) |
Property and equipment, net | 12,345 | 14,981 |
Laboratory Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 7,935 | 7,363 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 1,501 | 1,501 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 13,785 | 13,785 |
Construction-in-Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 1,213 | $ 239 |
Balance Sheet Components - Accrued Liabilities (Detail) - USD ($) $ in Thousands |
Jun. 30, 2019 |
Dec. 31, 2018 |
---|---|---|
Balance Sheet Components [Abstract] | ||
Accrued clinical and manufacturing expenses | $ 18,602 | $ 15,121 |
Accrued professional and consulting services | 4,336 | 1,016 |
Other | 431 | 655 |
Total accrued liabilities | $ 23,369 | $ 16,792 |
Balance Sheet Components - Other Liabilities (Detail) - USD ($) $ in Thousands |
Jun. 30, 2019 |
Dec. 31, 2018 |
---|---|---|
Balance Sheet Components [Abstract] | ||
Operating lease liabilities, current | $ 1,318 | |
Restricted shares subject to repurchase,current | $ 157 | |
Deferred rent, current | 712 | |
Other payable | 30 | 30 |
Total other liabilities, current | 1,348 | 899 |
Deferred rent, noncurrent | 11,041 | |
Accrued lease liabilities | 851 | |
Other liabilities, noncurrent | 30 | 30 |
Total other liabilities, noncurrent | $ 881 | $ 11,071 |
Stock Based Compensation - Plan Summary - Additional Information (Detail) |
Jun. 30, 2019
shares
|
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2017 Inducement Equity Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares authorized for issuance | shares | 418,150 |
2015 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares authorized for issuance | shares | 3,626,901 |
Stock Based Compensation - Stock Option Activity (Detail) |
6 Months Ended |
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Jun. 30, 2019
$ / shares
shares
| |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Beginning balance, outstanding, Number of Options | shares | 3,243,551 |
Options granted, Number of Options | shares | 807,965 |
Options exercised, Number of Options | shares | (175,801) |
Options canceled, Number of Options | shares | (116,869) |
Ending balance, outstanding, Number of Options | shares | 3,758,846 |
Weighted- Average Exercise Price | |
Beginning balance, Outstanding, Weighted-Average Exercise Price | $ / shares | $ 29.74 |
Options granted, Weighted-Average Exercise Price | $ / shares | 50.15 |
Options exercised, Weighted-Average Exercise Price | $ / shares | 17.91 |
Options canceled, Weighted-Average Exercise Price | $ / shares | 41.01 |
Ending balance, Outstanding, Weighted-Average Exercise Price | $ / shares | $ 34.33 |
Stock Based Compensation - Valuation Assumptions for Stock Options Granted (Detail) - Stock Options [Member] |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Minimum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (in years) | 5 years 3 months 18 days | 5 years 3 months 18 days | 5 years 3 months 18 days | 5 years 3 months 18 days |
Volatility, minimum | 70.50% | 68.70% | 70.50% | 68.70% |
Risk-free interest rate, minimum | 1.80% | 2.60% | 1.80% | 2.60% |
Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (in years) | 6 years 1 month 6 days | 6 years 1 month 6 days | 6 years 1 month 6 days | 6 years 1 month 6 days |
Volatility, maximum | 71.70% | 70.80% | 72.20% | 70.80% |
Risk-free interest rate, maximum | 2.40% | 2.90% | 2.60% | 2.90% |
Stock Based Compensation - Summary of RSU Activity Granted to Employees with Service-Based Vesting (Detail) - 2017 Inducement Plan and 2015 Plan [Member] - RSU [Member] |
6 Months Ended |
---|---|
Jun. 30, 2019
$ / shares
shares
| |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Beginning Balance - Non-vested market-condition awards | shares | 816,169 |
RSUs granted, Number of RSUs | shares | 995,385 |
RSUs vested, Number of RSUs | shares | (116,389) |
RSUs forfeited, Number of RSUs | shares | (75,317) |
Ending Balance - Non-vested market-condition awards | shares | 1,619,848 |
Beginning Balance - Non-vested units, Weighted-Average Grant Date Fair Value | $ / shares | $ 43.34 |
RSUs granted, Weighted-Average Grant Date Fair Value | $ / shares | 50.77 |
RSUs vested, Weighted-Average Grant Date Fair Value | $ / shares | 41.74 |
RSUs forfeited, Weighted-Average Grant Date Fair Value | $ / shares | 46.01 |
Ending Balance - Non-vested units, Weighted-Average Grant Date Fair Value | $ / shares | $ 47.90 |
Stock Based Compensation - Stock-based Compensation Expense Recognized (Detail) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | $ 10,948 | $ 7,800 | $ 20,401 | $ 15,584 |
Research and Development Expense [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | 4,715 | 3,784 | 8,738 | 6,752 |
General and Administrative Expense [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | $ 6,233 | $ 4,016 | $ 11,663 | $ 8,832 |
Net Loss per Share - Potentially Dilutive Securities that were Not Included in Diluted Net Loss per Share Calculations (Detail) - shares |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from earnings per share | 5,489,194 | 4,397,642 | 5,489,194 | 4,397,642 |
Stock Options [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from earnings per share | 3,758,846 | 3,297,839 | 3,758,846 | 3,297,839 |
Restricted Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from earnings per share | 97,037 | 97,037 | ||
RSU [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from earnings per share | 1,730,348 | 1,002,766 | 1,730,348 | 1,002,766 |
Commitments and Contingencies - Lessee Operating Lease Liability Maturity (Detail) $ in Thousands |
Jun. 30, 2019
USD ($)
|
---|---|
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2019 (six months) | $ 2,247 |
2020 | 4,576 |
2021 | 4,701 |
2022 | 4,856 |
2023 | 5,017 |
2024 | 5,183 |
Thereafter | 16,114 |
Total lease payments | 42,694 |
Less: Imputed interest | (17,328) |
Present value of operating lease liabilities | $ 25,366 |
Commitments and Contingencies - Lessee Operating Lease Liability Maturity (Detail) (Parenthetical) $ in Millions |
Jun. 30, 2019
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
Lessee Operating Lease Lease Not Yet Commenced Legally Binding Minimum Lease Payments | $ 121.5 |
Commitments and Contingencies - Minimum Lease payments (Detail) $ in Thousands |
Dec. 31, 2018
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
2019 | $ 4,406 |
2020 | 6,513 |
2021 | 11,642 |
2022 | 12,020 |
2023 | 12,409 |
Thereafter | 90,367 |
Total | $ 137,357 |
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