Operating Leases

6 Months Ended

Jun. 30, 2019

5. Operating Leases

We lease a facility adjacent to our manufacturing facility that has laboratory and office space that we use to support our manufacturing facility. We lease this space under a non-cancelable operating lease with an initial term ending in June 2021 and an option to extend the lease for up to two five-year periods.

We also lease additional office space and we sublease a portion of this space to Akcea. We lease this space under a non-cancelable operating lease with an initial term ending in June 2023 and an option to extend the lease for one five-year period. The sublease with Akcea is eliminated in our condensed consolidated financial statements.

Akcea entered into an operating lease agreement for office space located in Boston, Massachusetts for its new corporate headquarters in the second quarter of 2018. The lease commencement date was in August 2018 and Akcea took occupancy in September 2018. Akcea is leasing this space under a non-cancelable operating lease with an initial term ending after 123 months and an option to extend the lease for an additional five-year term. Under the lease agreement, Akcea received a three-month free rent period, which commenced on August 15, 2018, and a tenant improvement allowance up to $3.8 million. Akcea provided the lessor with a letter of credit to secure its obligations under the lease in the initial amount of $2.4 million, to be reduced to $1.8 million on the third anniversary of the rent commencement date and to $1.2 million on the fifth anniversary of the rent commencement date if Akcea meets certain conditions set forth in the lease at each such time.

When we determined our lease term for our operating lease right-of-use assets and lease liabilities for these leases, we did not include the extension options for these leases.

Amounts related to our operating leases were as follows (dollar amounts in millions):

	At June 30, 2019

Right-of-use operating lease assets (1)	$	12.9
Operating lease liabilities (2)	$	17.7
Weighted average remaining lease term	8.7 years
Weighted average discount rate		7.6	%

(1)	Included in deposits and other assets on our condensed consolidated balance sheet.

(2)	Current portion of $1.9 million was included in current portion of long-term obligations on our condensed consolidated balance sheet, with the difference included in long-term obligations.

During the six months ended June 30, 2019, we paid $2.0 million of rent payments, which was included in operating activities in our condensed consolidated statement of cash flows.

As of June 30, 2019, the payments for our operating lease liabilities are as follows (in thousands):

	Operating Leases
Remainder of 2019	$	1,548
Years ending December 31,
2020		3,124
2021		2,855
2022		2,607
2023		2,505
Thereafter		11,861
Total minimum lease payments		24,500
Less:
Imputed interest		(6,823	)
Total operating lease liabilities	$	17,677

Rent expense was $1.0 million and $0.9 million for the three months ended June 30, 2019 and 2018, respectively. Rent expense was $1.9 million and $0.9 million for the six months ended June 30, 2019 and 2018, respectively.