Commitments and contingencies	9 Months Ended
Sep. 30, 2022
Commitments and contingencies
Commitments and contingencies	12. Commitments and contingencies Operating and Finance Leases The Company leases real estate, including office and laboratory space and has entered into various other agreements with respect to assets used in conducting its business. The Company is required to maintain a cash balance of $0.4 million to secure letters of credit associated with real estate leases. This amount was classified as non-current restricted cash in the Company’s condensed consolidated balance sheet as of September 30, 2022. As of September 30, 2022 and December 31, 2021, the Company’s operating lease right-of-use assets were $4.0 million and $5.7 million, respectively, which are reported in operating lease right-of-use assets in the Company’s condensed consolidated balance sheets. As of September 30, 2022 the Company had no finance lease right-of-use assets, as of December 31, 2021, the Company’s finance lease right-of-use assets were $0.1 million, which are reported in finance lease right-of-use assets in the Company’s condensed consolidated balance sheets. As of September 30, 2022, the Company had outstanding operating lease obligations of $4.0 million, of which $1.6 million is reported in operating lease liabilities, current portion and $2.5 million is reported in operating lease liabilities, non-current portion in the Company’s condensed consolidated balance sheets. As of September 30, 2022, the Company had no outstanding finance lease obligations. As of December 31, 2021, the Company had outstanding operating lease obligations of $5.6 million, of which $1.7 million is reported in operating lease liabilities, current portion and $3.9 million is reported in operating lease liabilities, non-current portion in the Company’s condensed consolidated balance sheets. As of December 31, 2021, the Company had outstanding finance lease obligations of less than $0.1 million, which is reported in accrued expenses and other current liabilities in the Company’s condensed consolidated balance sheets. The Company’s weighted average discount rate and weighted average lease term remaining on operating lease liabilities is approximately 1.4% and 3.0 years, respectively. Contract manufacturing arrangements The Company has entered into arrangements with contract manufacturing organizations (“CMOs”) for manufacturing of materials for research and development purposes, including manufacturing of clinical trial materials. These contracts generally provide for non-cancellable obligations or cancellation penalties depending on the time of cancellation. As of September 30, 2022, the Company’s total non-cancellable obligations under contracts with CMOs, excluding embedded lease liabilities, were $8.5 million, of which $3.8 million relate to 2022 (remaining three months) deliverables, $4.7 million relate to 2023, and less than $0.1 million relate to 2024 deliverables. Intellectual property licenses The Company has entered into certain license agreements under which it is obligated to make milestone payments upon the achievement of certain development and regulatory milestones, to pay royalties on net sales of licensed products, and to pay a percentage of the sublicense fees which the Company receives from its sublicensees. In the three and nine months ended September 30, 2022, the Company recorded $0.4 million and $1.1 million, respectively, in licensing fees related to intellectual property licenses as general and administrative expenses. These amounts are partly related to the upfront payment and milestone payments received by the Company under the Gilead Collaboration Agreement. The amounts recognized as expenses have been agreed to by the licensors but calculation of sublicensing fees on future payments may be subject to interpretation and may change until agreed to by the receiving party. Indemnification agreements In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with members of its Board of Directors and senior management that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. To date, the Company has not incurred any material costs as a result of such indemnifications. The Company is not aware of any claims under indemnification arrangements, and it has not accrued any liabilities related to such obligations in its condensed consolidated financial statements as of September 30, 2022 or December 31, 2021. Legal proceedings At each reporting date, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. The Company is currently a party to a patent proceeding opposing European Patent No. 3218504, which was granted to the University of Geneva in July 2020 and is exclusively licensed to the Company. While it is not feasible to predict the outcome of these matters with certainty, and some lawsuits, claims or proceedings may be disposed or decided unfavorably, the Company does not expect that the pending patent opposition, and any asserted or unasserted legal claims or proceedings, individually or in the aggregate, will have a material adverse effect on the Company. However, if, as a result of the current patent proceeding, the Company would lose all, or at least part, of the protection under the opposed patent, such loss could erode the Company’s competitive position and harm its business and ability to achieve profitability. The Company expenses the costs related to the pending and other such legal proceedings as incurred.

Commitments and contingencies

9 Months Ended

Sep. 30, 2022

12. Commitments and contingencies

Operating and Finance Leases

The Company leases real estate, including office and laboratory space and has entered into various other agreements with respect to assets used in conducting its business. The Company is required to maintain a cash balance of $0.4 million to secure letters of credit associated with real estate leases. This amount was classified as non-current restricted cash in the Company’s condensed consolidated balance sheet as of September 30, 2022.

As of September 30, 2022 and December 31, 2021, the Company’s operating lease right-of-use assets were $4.0 million and $5.7 million, respectively, which are reported in operating lease right-of-use assets in the Company’s condensed consolidated balance sheets. As of September 30, 2022 the Company had no finance lease right-of-use assets, as of December 31, 2021, the Company’s finance lease right-of-use assets were $0.1 million, which are reported in finance lease right-of-use assets in the Company’s condensed consolidated balance sheets. As of September 30, 2022, the Company had outstanding operating lease obligations of $4.0 million, of which $1.6 million is reported in operating lease liabilities, current portion and $2.5 million is reported in operating lease liabilities, non-current portion in the Company’s condensed consolidated balance sheets. As of September 30, 2022, the Company had no outstanding finance lease obligations. As of December 31, 2021, the Company had outstanding operating lease obligations of $5.6 million, of which $1.7 million is reported in operating lease liabilities, current portion and $3.9 million is reported in operating lease liabilities, non-current portion in the Company’s condensed consolidated balance sheets. As of December 31, 2021, the Company had outstanding finance lease obligations of less than $0.1 million, which is reported in accrued expenses and other current liabilities in the Company’s condensed consolidated balance sheets. The Company’s weighted average discount rate and weighted average lease term remaining on operating lease liabilities is approximately 1.4% and 3.0 years, respectively.

Contract manufacturing arrangements

The Company has entered into arrangements with contract manufacturing organizations (“CMOs”) for manufacturing of materials for research and development purposes, including manufacturing of clinical trial materials. These contracts generally provide for non-cancellable obligations or cancellation penalties depending on the time of cancellation. As of September 30, 2022, the Company’s total non-cancellable obligations under contracts with CMOs, excluding embedded lease liabilities, were $8.5 million, of which $3.8 million relate to 2022 (remaining three months) deliverables, $4.7 million relate to 2023, and less than $0.1 million relate to 2024 deliverables.

Intellectual property licenses

The Company has entered into certain license agreements under which it is obligated to make milestone payments upon the achievement of certain development and regulatory milestones, to pay royalties on net sales of licensed products, and to pay a percentage of the sublicense fees which the Company receives from its sublicensees.

In the three and nine months ended September 30, 2022, the Company recorded $0.4 million and $1.1 million, respectively, in licensing fees related to intellectual property licenses as general and administrative expenses. These amounts are partly related to the upfront payment and milestone payments received by the Company under the Gilead Collaboration Agreement. The amounts recognized as expenses have been agreed to by the licensors but calculation of sublicensing fees on future payments may be subject to interpretation and may change until agreed to by the receiving party.

Indemnification agreements

In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with members of its Board of Directors and senior management that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. To date, the Company has not incurred any material costs as a result of such indemnifications. The Company is not aware of any claims under indemnification arrangements, and it has not accrued any liabilities related to such obligations in its condensed consolidated financial statements as of September 30, 2022 or December 31, 2021.

Legal proceedings

At each reporting date, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. The Company is currently a party to a patent proceeding opposing European Patent No. 3218504, which was granted to the University of Geneva in July 2020 and is exclusively licensed to the Company. While it is not feasible to predict the outcome of these matters with certainty, and some lawsuits, claims or proceedings may be disposed or decided unfavorably, the Company does not expect that the pending patent opposition, and any asserted or unasserted legal claims or proceedings, individually or in the aggregate, will have a material adverse effect on the Company. However, if, as a result of the current patent proceeding, the Company would lose all, or at least part, of the protection under the opposed patent, such loss could erode the Company’s competitive position and harm its business and ability to achieve profitability. The Company expenses the costs related to the pending and other such legal proceedings as incurred.