☒	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

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TABLE OF CONTENTS

Special Note Regarding Forward-Looking Statements

 

This Quarterly Report on Form 10‑Q contains forward-looking statements. All statements other than statements of historical facts contained in this Quarterly Report on Form 10‑Q, including statements regarding our future results of operations and financial position, business strategy, development plans, ongoing and planned future preclinical studies and clinical trials, future results of ongoing and planned future clinical trials, expected research and development costs, regulatory strategy, timing and likelihood of success, as well as plans and objectives of management for future operations, are forward-looking statements. In some cases, investors can identify forward-looking statements by terms such as “may,” “will,” “should,” “would,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential” or “continue” or the negative of these terms or other similar expressions. Forward-looking statements contained in this Quarterly Report on Form 10‑Q include, but are not limited to, statements about:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

We have based these forward-looking statements largely on our current expectations and projections about our business, the industry in which we operate and financial trends that we believe may affect our business, financial condition, results of operations and prospects, and these forward-looking statements are not guarantees of future performance or development. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10‑Q and are subject to a number of risks, uncertainties and assumptions described in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10‑Q. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, investors should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events or otherwise.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10‑Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely upon these statements.

(in thousands, except share and par value amounts)

		Common Stock								Additional Paid-in				Accumulated Other Comprehensive				Accumulated				Total Stockholders’				Redeemable Convertible Noncontrolling
		Shares				Amount				Capital				Loss				Deficit				Equity				Interests
Balance at December 31, 2022			44,342,292			$	4			$	484,237			$	(1,410	)		$	(259,363	)		$	223,468			$	35,000
Stock-based compensation expense			-				-				5,404				-				-				5,404				-
Acquisition of redeemable convertible noncontrolling interests			2,200,000				1				25,866				-				-				25,867				(35,000	)
Shares issued under equity incentive plans			27,356				-				17				-				-				17				-
Net loss			-				-				-				-				(32,940	)			(32,940	)			-
Other comprehensive gain			-				-				-				946				-				946				-
Balance at March 31, 2023			46,569,648			$	5			$	515,524			$	(464	)		$	(292,303	)		$	222,762			$	-
Stock-based compensation expense			-				-				5,403				-				-				5,403				-
Shares issued under equity incentive plans			403,601				-				967				-				-				967				-
Shares issued under employee stock purchase plan			78,201				-				284				-				-				284				-
Net loss			-				-				-				-				(31,918	)			(31,918	)			-
Other comprehensive gain			-				-				-				122				-				122				-
Balance at June 30, 2023			47,051,450			$	5			$	522,178			$	(342	)		$	(324,221	)		$	197,620			$	-
Balance at December 31, 2021			43,855,944			$	4			$	463,089			$	(524	)		$	(143,092	)		$	319,477			$	35,000
Stock-based compensation expense			-				-				4,777				-				-				4,777				-
Shares issued under equity incentive plans			100,105				-				125				-				-				125				-
Net loss			-				-				-				-				(26,902	)			(26,902	)			-
Other comprehensive loss			-				-				-				(1,656	)			-				(1,656	)			-
Balance at March 31, 2022			43,956,049			$	4			$	467,991			$	(2,180	)		$	(169,994	)		$	295,821			$	35,000
Stock-based compensation expense			-				-				4,882				-				-				4,882				-
Shares issued under equity incentive plans			97,833				-				283				-				-				283				-
Shares issued under employee stock purchase plan			43,039				-				369				-				-				369				-
Net loss			-				-				-				-				(27,069	)			(27,069	)			-
Other comprehensive loss			-				-				-				(557	)			-				(557	)			-
Balance at June 30, 2022			44,096,921			$	4			$	473,525			$	(2,737	)		$	(197,063	)		$	273,729			$	35,000

2. Summary of Significant Accounting Policies

 

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Accounting estimates and management judgments reflected in the financial statements include: normal recurring accruals, including the accrual of research and development expenses; fair value of investments; valuation of deferred tax assets; and stock-based compensation. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may materially differ from these estimates and assumptions. The Company uses the best information available to update its critical accounting estimates.

 

Net Loss Per Share

 

Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, the Company’s common stock options and unvested restricted stock units are considered to be potentially dilutive securities. As the Company has reported a net loss for all periods presented, diluted net loss per common share is the same as basic net loss per common share for those periods.

 

The following table sets forth the computation of the basic and diluted net loss per share (in thousands, except share and per share amounts):

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2023				2022				2023				2022
Numerator
Net loss		$	(31,918	)		$	(27,069	)		$	(64,858	)		$	(53,971	)
Denominator
Weighted-average shares outstanding used in computing net loss per share, basic and diluted			46,655,966				44,002,391				46,036,212				43,942,986
Net loss per share, basic and diluted		$	(0.68	)		$	(0.62	)		$	(1.41	)		$	(1.23	)

The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net loss per share for the periods presented because including them would have been anti-dilutive:

		June 30, 2023				June 30, 2022
Options to purchase common stock			11,378,511				9,511,827
Non-vested restricted stock units			415,326				-
Total			11,793,837				9,511,827

Recently Issued Accounting Standards

  

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326) (ASC 326): Measurement of Credit Losses on Financial Instruments, which introduced the expected credit losses methodology for the measurement of credit losses on financial assets measured at amortized cost basis, replacing the previous incurred loss methodology. The amendments in Update 2016-13 added Topic 326, Financial Instruments—Credit Losses, made several consequential amendments to the Codification. Update 2016-13 also modified the accounting for available-for-sale debt securities, which must be individually assessed for credit losses when fair value is less than the amortized cost basis, in accordance with Subtopic 326-30, Financial Instruments— Credit Losses—Available-for-Sale Debt Securities. The guidance is effective for public business entities for annual periods beginning after December 15, 2019, including interim periods within those years. For all other entities, the standard is effective for annual periods beginning after December 15, 2022 and interim periods, therein. Early adoption is permitted. Since the Company has elected to use the extended transition period under the JOBS Act available to emerging growth companies (EGCs), the ASU is effective for the Company for fiscal years beginning after December 15, 2022. The Company adopted this standard on the required effective date of January 1, 2023. The ASU did not have a material impact on its consolidated financial statements and related disclosures.