Leases

6 Months Ended

Jun. 30, 2024

Leases [Abstract]

Leases

Leases

The Company’s lease portfolio is comprised of operating leases for laboratory, office and manufacturing facilities located in South San Francisco, California, and Seattle and Bothell, Washington with contractual periods expiring between December 2028 and March 2031. In addition to minimum rent, the leases require payment of real estate taxes, insurance, common area maintenance charges and other executory costs. These additional charges are considered variable lease costs and are recognized in the period in which the costs are incurred.

The following table summarizes the Company’s future minimum operating lease commitments as of June 30, 2024 (in thousands):

Year Ending December 31:
2024 (remaining six months)	$	5,796
2025	11,859
2026	12,209
2027	12,569
2028	12,940
Thereafter	22,585
Total undiscounted lease payments	77,958
Less: imputed interest	(17,737)
Total operating lease liabilities	$	60,221
Reported as of June 30, 2024:
Short-term portion of lease liabilities (included in accrued liabilities and other current liabilities)	$	6,898
Operating lease liabilities, non-current	53,323
Total	$	60,221

The operating lease costs for all operating leases were $2.3 million for both the three months ended June 30, 2024 and 2023, and $4.6 million and $4.4 million for the six months ended June 30, 2024 and 2023, respectively. The operating lease costs and total commitments for short-term leases were de minimis for the three and six months ended June 30, 2024 and 2023. Variable lease costs for operating leases were $1.6 million and $1.4 million for the three months ended June 30, 2024 and 2023, respectively, and $3.9 million and $2.8 million for the six months ended June 30, 2024 and 2023, respectively. The weighted-average remaining lease terms for operating leases were 6.3 and 6.8 years as of June 30, 2024 and December 31, 2023, respectively. The weighted‑average discount rate for operating leases was 8.5% as of both June 30, 2024 and December 31, 2023.

In May 2021, the Company entered into a sublease, whereby the Company agreed to sublease approximately 11,000 square feet of its space in South San Francisco, California currently leased by the Company. The sublease is classified as an operating lease and will expire in March 2031. The Company recognized sublease income for this sublease of $0.2 million for both the three months ended June 30, 2024 and 2023, and $0.4 million for both the six months ended June 30, 2024 and 2023.

In September 2021, the Company entered into a sublease with Sonoma Biotherapeutics, Inc. (“Sonoma”), a related party, whereby the Company agreed to sublease approximately 18,000 square feet of space in South San Francisco,

California currently leased by the Company. See Note 12, Related-Party Transactions. As a part of the sublease, in September 2021, the Company received a $4.6 million tenant improvement contribution payment, which is recognized over the term of the sublease. The sublease is classified as an operating lease and will expire in March 2031. The Company recognized Sonoma sublease income of $0.5 million for both the three months ended June 30, 2024 and 2023, and $0.9 million for both the six months ended June 30, 2024 and 2023.

The Company's sublease income is recognized within other operating income, net in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

Leases

Leases

The Company’s lease portfolio is comprised of operating leases for laboratory, office and manufacturing facilities located in South San Francisco, California, and Seattle and Bothell, Washington with contractual periods expiring between December 2028 and March 2031. In addition to minimum rent, the leases require payment of real estate taxes, insurance, common area maintenance charges and other executory costs. These additional charges are considered variable lease costs and are recognized in the period in which the costs are incurred.

The following table summarizes the Company’s future minimum operating lease commitments as of June 30, 2024 (in thousands):

Year Ending December 31:
2024 (remaining six months)	$	5,796
2025	11,859
2026	12,209
2027	12,569
2028	12,940
Thereafter	22,585
Total undiscounted lease payments	77,958
Less: imputed interest	(17,737)
Total operating lease liabilities	$	60,221
Reported as of June 30, 2024:
Short-term portion of lease liabilities (included in accrued liabilities and other current liabilities)	$	6,898
Operating lease liabilities, non-current	53,323
Total	$	60,221

The operating lease costs for all operating leases were $2.3 million for both the three months ended June 30, 2024 and 2023, and $4.6 million and $4.4 million for the six months ended June 30, 2024 and 2023, respectively. The operating lease costs and total commitments for short-term leases were de minimis for the three and six months ended June 30, 2024 and 2023. Variable lease costs for operating leases were $1.6 million and $1.4 million for the three months ended June 30, 2024 and 2023, respectively, and $3.9 million and $2.8 million for the six months ended June 30, 2024 and 2023, respectively. The weighted-average remaining lease terms for operating leases were 6.3 and 6.8 years as of June 30, 2024 and December 31, 2023, respectively. The weighted‑average discount rate for operating leases was 8.5% as of both June 30, 2024 and December 31, 2023.

In May 2021, the Company entered into a sublease, whereby the Company agreed to sublease approximately 11,000 square feet of its space in South San Francisco, California currently leased by the Company. The sublease is classified as an operating lease and will expire in March 2031. The Company recognized sublease income for this sublease of $0.2 million for both the three months ended June 30, 2024 and 2023, and $0.4 million for both the six months ended June 30, 2024 and 2023.

In September 2021, the Company entered into a sublease with Sonoma Biotherapeutics, Inc. (“Sonoma”), a related party, whereby the Company agreed to sublease approximately 18,000 square feet of space in South San Francisco,

California currently leased by the Company. See Note 12, Related-Party Transactions. As a part of the sublease, in September 2021, the Company received a $4.6 million tenant improvement contribution payment, which is recognized over the term of the sublease. The sublease is classified as an operating lease and will expire in March 2031. The Company recognized Sonoma sublease income of $0.5 million for both the three months ended June 30, 2024 and 2023, and $0.9 million for both the six months ended June 30, 2024 and 2023.

The Company's sublease income is recognized within other operating income, net in the Condensed Consolidated Statements of Operations and Comprehensive Loss.