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Leases
 9 Months Ended
Jun. 30, 2024
Leases [Abstract]  
Leases LEASES
Pasadena, California: The Company leases 49,000 square feet of office space located at 177 East Colorado Blvd. for its corporate headquarters from 177 Colorado Owner, LLC, which lease expires on April 30, 2027. The lease contains an option to renew for one additional five-year term. The Company is not reasonably certain that it will exercise this option to
renew and therefore it is not included in right-of-use assets and liabilities as of June 30, 2024.
San Diego, California: The Company leases 144,000 square feet of office and research and development laboratory space located at 10102 Hoyt Park from 11404 & 11408 Sorrento Valley Owner, LLC, which lease expires on April 30, 2038. Pursuant to the lease, within twelve months of the expiration of the initial 15-year term, the Company has the option to extend the lease for up to one additional ten-year term, with certain annual increases in base rent. The Company is not reasonably certain that it will exercise this option to renew and therefore it is not included in right-of-use assets and liabilities as of June 30, 2024.
The lease agreement grants the Company the right to receive an Additional Tenant Improvement Allowance (“ATIA”) funded by the lessor, with a maximum amount of $7.2 million, subject to a 7% interest per annum over the base term. Further, on September 25, 2023, the Company executed the first amendment to the lease, which grants a second ATIA with a maximum amount of $23.6 million, bearing interest at a rate of 9% per annum over the base term. The Company received $30.8 million ATIA from the lessor during the first quarter of fiscal 2024. As a result, the Company remeasured its lease liability and right-of-use assets to reflect these additional allowances and the related increased lease payments. The Company has further concluded that these ATIAs have no effects on the classification of the lease.
The Company previously subleased additional research and development space in San Diego, California, which sublease ended during the fiscal year of 2023.
Madison, Wisconsin: The Company leases 115,000 square feet space located at 502 South Rosa Road for its office and laboratory facilities, which lease expires on September 30, 2031. The lease contains options to renew for two terms of five years. The Company is not reasonably certain that it will exercise this option and therefore it is not included in right-of-use assets and liabilities as of June 30, 2024.
The components of lease assets and liabilities along with their classification on the Company’s consolidated balance sheets were as follows:
Lease Assets and LiabilitiesClassificationJune 30, 2024September 30, 2023
(in thousands)
Operating lease assetsRight-of-use assets$44,339 $45,297 
Current operating lease liabilitiesLease liabilities6,053 10,563 
Non-current operating lease liabilitiesLease liabilities, net of current portion112,040 104,608 
Three Months Ended June 30,Nine Months Ended June 30,
Lease CostClassification2024202320242023
(in thousands)
Operating lease costResearch and development$2,965 $3,323 $8,531 $7,735 
General and administrative expense537 509 1,504 1,542 
Variable lease cost (1)
Research and development863 257 2,478 627 
General and administrative expense— — — — 
Total $4,365 $4,089 $12,513 $9,904 
(1) Variable lease cost is primarily related to operating expenses associated with the Company’s operating leases.
There was no short-term lease cost during the nine months ended June 30, 2024. There was $0.6 million and $1.2 million short-term lease cost during the three and nine months ended June 30, 2023, respectively.
The following table presents maturities of operating lease liabilities on an undiscounted basis as of June 30, 2024:
YearAmounts
(in thousands)
2024 (remainder of fiscal year)$3,793 
202515,356 
202615,696 
202714,869 
202813,511 
2029 and thereafter128,356 
Total$191,581 
Less imputed interest$(73,488)
Total operating lease liabilities (includes current portion)$118,093 
Supplemental cash flow and other information related to leases was as follows:
Three Months Ended June 30,Nine Months Ended June 30,
2024202320242023
(in thousands)
Cash received for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$— $5,414 $3,099 $23,343 
Right-of-use assets adjusted in exchange for new/amended operating lease liabilities
$— $3,519 $(64)$(19,063)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$3,204 $1,885 $7,221 $4,081 
June 30,
20242023
Weighted-average remaining lease term (in years)12.813.4
Weighted-average discount rate8.0 %8.0 %