UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended September 30, 2023
OR
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from _________________ to _______________________
Commission file number: 001-39743
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification Number)
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code: (858 ) 299-4699
Securities registered pursuant to Section 12(b) of the Act:
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Title of Each Class
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Trading Symbol(s)
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Name of Each Exchange on
Which Registered
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes
☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S‑T (§232.405 of this chapter)
during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the
definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Large accelerated filer
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Accelerated filer
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Smaller reporting company
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Emerging growth company
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards
provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of November 3, 2023, the Registrant had 47,112,698 shares of common stock,
$0.0001 par value per share, outstanding.
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Page
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PART I—FINANCIAL INFORMATION
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Item 1.
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1
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1
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2
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3
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4
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5
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Item 2.
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16 | |
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Item 3.
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27
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Item 4.
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28
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PART II—OTHER INFORMATION
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Item 1.
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28 | |
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Item 1A.
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28 | |
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Item 2.
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96 | |
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Item 3.
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96
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Item 4.
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96
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Item 5.
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96
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Item 6.
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97
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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:
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the timing of and steps to implement our Strategic Plan, including the prioritization of certain research and development programs;
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the ability of our ongoing and planned future preclinical studies and clinical trials to demonstrate safety and efficacy of our product candidates, and other positive results;
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the timing, progress and results of ongoing and planned future preclinical studies and clinical trials for our current product candidates, and other product candidates we may develop, including statements regarding the timing of initiation
and completion of preclinical studies or clinical trials and related preparatory work, the period during which the results of the preclinical studies or clinical trials will become available, and our research and development programs;
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the timing, scope and likelihood of regulatory filings and approvals, including timing of investigational new drug applications (INDs) and final approval by the U.S. Food and Drug Administration (FDA) of our current product candidates and
any other future product candidates;
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the timing, scope or likelihood of foreign regulatory filings and approvals;
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our ability to develop and advance our current product candidates and programs into, and successfully complete, clinical trials;
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our manufacturing, commercialization, and marketing capabilities and strategy;
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our plans relating to commercializing our product candidates, if approved, including the geographic areas of focus and sales strategy;
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the need to hire additional personnel and our ability to attract and retain such personnel;
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the size of the market opportunity for our product candidates, including our estimates of the number of patients who suffer from the diseases we are targeting;
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our expectations regarding the approval and use of our product candidates in combination with other drugs;
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our competitive position and the success of competing therapies that are or may become available;
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our estimates of the number of patients that we will enroll in our clinical trials;
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the beneficial characteristics, and the potential safety, efficacy and therapeutic effects of our product candidates;
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our ability to obtain and maintain regulatory approval of our product candidates;
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our plans relating to the further development of our product candidates, including additional indications we may pursue;
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existing regulations, regulatory developments and the outcome of related litigation in the United States, Europe and other jurisdictions;
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our expectations regarding the impact of public health concerns, supply chain disruptions, inflation and other drivers of macroeconomic volatility on our business;
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our intellectual property position, including the scope of protection we are able to establish and maintain for intellectual property rights covering our current product candidates and other future product candidates we may develop,
including the extensions of existing patent terms where available, the validity of intellectual property rights held by third parties, and our ability not to infringe, misappropriate or otherwise violate any third-party intellectual property
rights;
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our continued reliance on third parties to conduct ongoing and planned future preclinical studies and clinical trials of our product candidates, and for the manufacture of our product candidates for preclinical studies and clinical trials;
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our ability to obtain, and negotiate favorable terms of, any collaboration, licensing or other arrangements that may be necessary or desirable to develop, manufacture or commercialize our product candidates;
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the pricing and reimbursement of our current product candidates and other product candidates we may develop, if approved;
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the rate and degree of market acceptance and clinical utility of our current product candidates and other product candidates we may develop;
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our estimates regarding expenses, future revenue, capital requirements and needs for additional financing;
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our financial performance;
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the period over which we estimate our existing cash and cash equivalents will be sufficient to fund our future operating expenses and capital expenditure requirements;
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the impact of laws and regulations;
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our expectations regarding the period during which we will remain an emerging growth company under the Jumpstart Our Business Startups Act of 2012 (JOBS Act); and
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our anticipated use of our existing resources.
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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.
PART I—FINANCIAL INFORMATION
KINNATE BIOPHARMA INC.
(Unaudited)
(in thousands, except share and par value amounts)
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September 30, 2023
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December 31, 2022
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Assets
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Current assets:
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Cash and cash equivalents
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$
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$
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Cash at consolidated joint venture
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||||||||
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Short-term investments
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Prepaid expenses and other current assets
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Total current assets
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Property and equipment, net
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Right-of-use lease assets
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Long-term investments
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| Restricted cash |
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Total assets
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$
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$
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Liabilities, Redeemable Convertible Noncontrolling Interests and Stockholders’ Equity
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Current liabilities:
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Accounts payable
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$
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$
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Accrued expenses
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| Current portion of operating lease liabilities | ||||||||
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Total current liabilities
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Total liabilities
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Commitments and contingencies (See Note 12)
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| Redeemable convertible noncontrolling interests | ||||||||
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Stockholders’ equity:
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Preferred stock, $
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Common stock, $
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Additional paid-in capital
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Accumulated other comprehensive loss
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(
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)
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(
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)
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Accumulated deficit
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(
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(
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)
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Total stockholders’ equity
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Total liabilities, redeemable convertible noncontrolling interests and stockholders’ equity
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$
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$
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See accompanying notes to unaudited condensed consolidated financial statements.
KINNATE BIOPHARMA INC.
COMPREHENSIVE LOSS
(Unaudited)
(in thousands, except share and per share amounts)
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Three Months Ended September 30,
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Nine Months Ended September 30,
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|||||||||||||||
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2023
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2022
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2023
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2022
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Operating expenses:
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Research and development
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$
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$
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$
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$
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General and administrative
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Restructuring costs
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Total operating expenses
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Loss from operations
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(
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(
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(
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(
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Other income, net
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Net loss
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$
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(
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)
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$
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(
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)
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$
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(
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)
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$
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(
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)
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Weighted-average shares outstanding, basic and diluted
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Net loss per share, basic and diluted
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$
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(
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)
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$
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(
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)
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$
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(
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)
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$
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(
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)
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Comprehensive loss:
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Net loss
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$
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(
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)
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$
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(
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)
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$
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(
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)
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$
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(
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)
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Other comprehensive loss:
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||||||||||||||||
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Unrealized gain (loss) on investments
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(
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|||||||||||
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Total comprehensive loss
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$
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(
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)
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$
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(
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)
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$
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(
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)
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$
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(
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)
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See accompanying notes to unaudited condensed consolidated financial statements.
KINNATE BIOPHARMA INC.
(Unaudited)
(in thousands, except share amounts)
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Common Stock
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Additional
Paid-in |
Accumulated Other
Comprehensive
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Accumulated
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Total
Stockholders’ |
Redeemable Convertible Noncontrolling
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|||||||||||||||||||||||
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Shares
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Amount
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Capital
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Loss
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Deficit
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Equity
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Interests
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Balance at December 31, 2022
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$
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$
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$
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(
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)
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$
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(
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)
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$
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$
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|||||||||||||
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Stock-based compensation expense
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-
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|||||||||||||||||||||
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Acquisition of redeemable convertible noncontrolling interests
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( |
) | ||||||||||||||||||||||||||
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Shares issued under equity incentive plans
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||||||||||||||||||||||||||||
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Net loss
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-
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(
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)
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(
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)
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|||||||||||||||||||
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Other comprehensive gain
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-
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|||||||||||||||||||||
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Balance at March 31, 2023
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$
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$
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$
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(
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)
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$
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(
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)
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$
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$
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|||||||||||||
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Stock-based compensation expense
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- | |||||||||||||||||||||||||||
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Shares issued under equity incentive plans
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||||||||||||||||||||||||||||
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Shares issued under employee stock purchase plan
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| Net loss | - | ( |
) | ( |
) | |||||||||||||||||||||||
| Other comprehensive gain |
- | |||||||||||||||||||||||||||
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Balance at June 30, 2023
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$ | $ | $ | ( |
) | $ | ( |
) | $ | $ | ||||||||||||||||||
| Stock-based compensation expense |
- | |||||||||||||||||||||||||||
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Shares issued under equity incentive plans
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||||||||||||||||||||||||||||
| Net loss |
- | ( |
) | ( |
) | |||||||||||||||||||||||
| Other comprehensive gain |
- | |||||||||||||||||||||||||||
| Balance at September 30, 2023 | $ | $ | $ | ( |
) | $ | ( |
) | $ | $ | ||||||||||||||||||
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||||||||||||||||||||||||||||
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Balance at December 31, 2021
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|
$
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$
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$
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(
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)
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$
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(
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)
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$
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$
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|||||||||||||
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Stock-based compensation expense
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-
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Shares issued under equity incentive plans
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Net loss
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-
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(
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)
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(
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)
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|||||||||||||||||||
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Other comprehensive loss
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-
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(
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)
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(
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)
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|||||||||||||||||||
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Balance at March 31, 2022
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|
$
|
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$
|
|
$
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(
|
)
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$
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(
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)
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$
|
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$
|
|
|||||||||||||
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Stock-based compensation expense
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- | |||||||||||||||||||||||||||
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Shares issued under equity incentive plans
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||||||||||||||||||||||||||||
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Shares issued under employee stock purchase plan
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||||||||||||||||||||||||||||
| Net loss | - | ( |
) | ( |
) | |||||||||||||||||||||||
| Other comprehensive loss | - | ( |
) | ( |
) | |||||||||||||||||||||||
| Balance at June 30, 2022 | $ | $ | $ | ( |
) | $ | ( |
) | $ | $ | ||||||||||||||||||
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Stock-based compensation expense
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- | |||||||||||||||||||||||||||
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Shares issued under equity incentive plans
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Net loss
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- | ( |
) | ( |
) | |||||||||||||||||||||||
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Other comprehensive gain
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- | |||||||||||||||||||||||||||
| Balance at September 30, 2022 | $ | $ | $ | ( |
) | $ | ( |
) | $ | $ | ||||||||||||||||||
See accompanying notes to unaudited condensed consolidated financial statements.
KINNATE BIOPHARMA INC.
(Unaudited)
(in thousands)
|
Nine Months Ended September 30,
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2023
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2022
|
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Cash flows from operating activities:
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Net loss
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$
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(
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)
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$
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(
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)
|
||
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Adjustments to reconcile net loss to net cash used in operating activities:
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Stock-based compensation expense
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||||||
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Depreciation
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|
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Amortization/accretion of investments
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(
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)
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|
|||||
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Changes in operating assets and liabilities:
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Prepaid expenses and other assets
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Operating lease right-of-use assets and liabilities, net
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(
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)
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|
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Accounts payable and accrued expenses
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(
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)
|
|
|||||
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Net cash used in operating activities
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(
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)
|
(
|
)
|
||||
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Cash flows from investing activities:
|
||||||||
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Purchases of short-term and long-term investments
|
(
|
)
|
(
|
)
|
||||
|
Sales and maturities of short-term and long-term investments
|
|
|
||||||
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Purchases of property and equipment
|
|
(
|
)
|
|||||
|
Net cash provided by (used in) investing activities
|
|
(
|
)
|
|||||
|
Cash flows from financing activities:
|
||||||||
|
Acquisition of redeemable convertible noncontrolling interests
|
(
|
)
|
|
|||||
|
Proceeds from issuance of common stock under equity incentive plans
|
|
|
||||||
|
Proceeds from issuance of common stock under employee stock purchase plan
|
||||||||
|
Net cash (used in) provided by financing activities
|
(
|
)
|
|
|||||
| Effect of exchange rate changes on cash and cash equivalents |
( |
) | ( |
) | ||||
|
Net decrease in cash, cash equivalents and restricted cash
|
(
|
)
|
(
|
)
|
||||
|
Cash, cash equivalents and restricted cash at the beginning of the period
|
|
|
||||||
|
Cash, cash equivalents and restricted cash at the end of the period
|
$
|
|
$
|
|
||||
|
Supplemental non-cash investing and financing activity:
|
||||||||
|
Acquisition of redeemable convertible noncontrolling interests
|
$
|
|
$
|
|
||||
|
Capitalized value of tenant improvement allowance
|
$
|
|
$
|
|
||||
|
Operating lease liabilities arising from obtaining right-of-use assets
|
$
|
|
$
|
|
||||
See accompanying notes to unaudited condensed consolidated financial statements.
KINNATE BIOPHARMA INC.
1. Organization and Basis of Presentation
Organization and Nature of
Operations
Kinnate Biopharma Inc. (Kinnate or the Company) was incorporated in the State of
Delaware in January 2018 and is headquartered in San Francisco, California. The Company is a precision oncology company focused on the discovery, design and development of small molecule kinase inhibitors for difficult-to-treat, genomically defined
cancers.
Since its inception, the Company has devoted substantially all of its resources to research and development activities, business planning,
establishing and maintaining its intellectual property portfolio, hiring personnel, raising capital, and providing general and administrative support for these operations. It has incurred losses and negative cash flows from operations since
commencement of its operations. The Company had an accumulated deficit of $355.0 million and had cash and cash equivalents and
short-term and long-term investments totaling $180.3 million as of September 30, 2023. From its inception through September 30, 2023,
the Company has financed its operations primarily through issuances of common stock, including in the Company’s initial public offering (IPO), and private placements of convertible preferred stock.
In May 2021, the Company announced the closing of a Series A preferred stock financing of a China joint venture, Kinnjiu Biopharma Inc. (Kinnjiu), to
enable the potential development and commercialization of certain targeted oncology product candidates across People’s Republic of China, Hong Kong, Taiwan, and Macau. Contributions from noncontrolling interest members totaled $35.0 million before issuance costs of $0.2
million. In February 2023, the Company acquired the noncontrolling interests in Kinnjiu previously held by Series A investors (Kinnjiu Transaction) – see Note 11. Kinnjiu is now a wholly-owned subsidiary of the Company.
As the Company continues to pursue its business plan, it expects to finance its operations through the sale of equity, debt financings or other
capital resources, which could include income from collaborations, strategic partnerships or marketing, distribution, licensing or other strategic arrangements with third parties, or from grants. However, there can be no assurance that any
additional financing or strategic transactions will be available to the Company on acceptable terms, if at all. If events or circumstances occur such that the Company does not obtain additional funding, it may need to delay, reduce or eliminate
its product development or future commercialization efforts, which could have a material adverse effect on the Company’s business, results of operations or financial condition. The accompanying condensed consolidated financial statements do not
include any adjustments that might be necessary if the Company were unable to continue as a going concern. Management believes that it has sufficient working capital on hand to fund operations through at least the next twelve months from the date
this Quarterly Report on Form 10-Q is filed with the U.S. Securities and Exchange Commission (SEC).
In September 2023, the Company’s board of directors, based on a strategic review of the Company’s business, approved a reprioritization of the
Company’s research and development programs and a workforce restructuring (the “Strategic Plan”). The Company began implementing the Strategic Plan in September 2023. See Note 13 for more details.
Basis of Presentation
The Company’s condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S.
GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of SEC Regulation S-X. Accordingly, since they are interim statements, the accompanying condensed consolidated financial statements do not include all
of the information and notes required by GAAP for complete financial statements.
The accompanying unaudited interim condensed consolidated financial statements include all known adjustments which, in the opinion of management, are
necessary for a fair presentation of the results as required by GAAP. These adjustments consist primarily of normal recurring accruals and estimates that impact the carrying value of assets and liabilities. Operating results presented in these
unaudited condensed consolidated financial statements are not necessarily indicative of future results. The condensed consolidated balance sheet at December 31, 2022 has been derived from the audited financial statements at that date, but does
not include all information and footnotes required by GAAP for complete financial statements. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and the notes thereto
for the year ended December 31, 2022, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 15, 2023.
The condensed consolidated financial statements include the accounts of the Company’s wholly-owned subsidiary, Kinnjiu. All intercompany transactions
and balances have been eliminated in consolidation.
Prior to the completion of the Kinnjiu Transaction, the Company evaluated its ownership, contractual and other interests in entities that were not
wholly-owned to determine if any of these entities was a variable interest entity (VIE), and, if so, whether the Company was the primary beneficiary of the VIE. In determining whether the Company was the primary beneficiary of a VIE and therefore
required to consolidate the VIE, the Company applied a qualitative approach that determined whether the Company had both (1) the power to direct the activities of the VIE that most significantly impacted the VIE’s economic performance and (2) the
obligation to absorb losses of, or the rights to receive benefits from, the VIE that could potentially be significant to that VIE. As of December 31, 2022, the Company held an approximately 58 % equity interest in Kinnjiu. Based on the Company’s assessment, the Company concluded that Kinnjiu was a VIE and the Company was the primary beneficiary. See Note 11 with respect to
Kinnjiu Transaction.
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; accrued restructuring costs; 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.
Redeemable Convertible Noncontrolling Interests
Prior to the Kinnjiu Transaction, the shares third parties owned in Kinnjiu represented an interest in the equity the Company did not control. The redeemable convertible noncontrolling interests
attributable to other owners was classified in temporary equity on the condensed consolidated balance sheets as the preferred stock was redeemable by the noncontrolling interests.
Since the preferred stock held at Kinnjiu did not represent a residual equity interest, net losses of Kinnjiu were not allocated to the preferred shares. As a result, the balance of the preferred
stock classified as a redeemable convertible noncontrolling interest equaled its carrying value. Additionally, net losses of Kinnjiu were not allocated to the noncontrolling interest related to ordinary shares held by a third party as the
amounts to be allocated were immaterial. Accordingly, for the three and nine months ended September 30, 2022, no
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 September 30, |
Nine Months Ended September 30,
|
|||||||||||||||
| 2023 | 2022 |
2023
|
2022
|
|||||||||||||
|
Numerator
|
||||||||||||||||
|
Net loss
|
$ | ( |
) | $ | ( |
) |
$
|
(
|
)
|
$
|
(
|
)
|
||||
|
Denominator
|
||||||||||||||||
|
Weighted-average shares outstanding used in computing net loss per share, basic and diluted
|
|
|
||||||||||||||
|
Net loss per share, basic and diluted
|
$ | ( |
) | $ | ( |
) |
$
|
(
|
)
|
$
|
(
|
)
|
||||
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:
|
Three Months Ended September 30,
|
Nine Months Ended September 30,
|
|||||||||||||||
|
2023
|
2022
|
2023
|
2022
|
|||||||||||||
|
Options to purchase common stock
|
|
|
|
|
||||||||||||
|
Non-vested restricted stock units
|
|
|
|
|
||||||||||||
|
Total
|
|
|
|
|
||||||||||||
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.
3. Cash, cash equivalents and restricted cash
The following table provides a
reconciliation of the components of cash, cash equivalents and restricted cash reported in the condensed consolidated statements of cash flows (in thousands):
|
September 30, 2023
|
December 31, 2022
|
|||||||
|
Cash and cash equivalents
|
$
|
|
$
|
|
||||
| Cash at consolidated joint venture | ||||||||
|
Restricted cash, non-current
|
|
|
||||||
|
Total cash, cash equivalents and restricted cash reported in the Consolidated Statements of Cash Flows
|
$
|
|
$
|
|
||||
The cash at the consolidated joint venture
represents cash held at Kinnjiu prior to the Kinnjiu Transaction and the use of such cash was limited to the operations of Kinnjiu (see Note 11). As a result of the Kinnjiu Transaction, such cash is no longer limited in its use and accordingly is
no longer presented separately on the condensed consolidated balance sheet. The restricted cash balance relates to the Company’s office lease in San Diego, California (see Note 12).
4. Property and Equipment, Net
Property and equipment, net consisted of the following (in thousands):
|
September 30, 2023
|
December 31, 2022
|
|||||||
|
Furniture and fixtures
|
$
|
|
$
|
|
||||
|
Computers and equipment
|
|
|
||||||
|
Computer software
|
|
|
||||||
| Leasehold improvements |
||||||||
|
Property and equipment
|
|
|
||||||
|
Less accumulated depreciation
|
(
|
)
|
(
|
)
|
||||
|
Property and equipment, net
|
$
|
|
$
|
|
||||
5. Accrued Expenses
Accrued expenses consisted of the following (in thousands):
|
September 30, 2023
|
December 31, 2022
|
|||||||
|
Accrued research and development
|
$
|
|
$
|
|
||||
|
Accrued compensation
|
|
|
||||||
| Accrued restructuring costs | ||||||||
|
Accrued legal fees
|
|
|
||||||
|
Other accruals
|
|
|
||||||
|
Total
|
$
|
|
$
|
|
||||
6. Investments
The Company has invested its excess cash in marketable securities as of September 30, 2023 and December
31, 2022. The following is a summary by significant investment category (in thousands):
|
|
September 30, 2023
|
|||||||||||||||||||
|
|
Maturity
|
Amortized
|
Unrealized
|
Unrealized
|
Estimated
|
|||||||||||||||
|
|
in Years
|
Cost
|
Gains
|
Losses
|
Fair Value
|
|||||||||||||||
|
Corporate debt securities
|
less than
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||
|
Commercial paper
|
less than
|
|
|
(
|
)
|
|
||||||||||||||
|
U.S. Treasury securities
|
less than
|
|
|
(
|
)
|
|
||||||||||||||
|
U.S. Agency bonds
|
less than
|
|
|
(
|
)
|
|
||||||||||||||
| Asset-backed securities |
( |
) | ||||||||||||||||||
|
Short-term investments
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||||
|
|
||||||||||||||||||||
|
Corporate debt securities
|
|
$
|
|
$
|
|
$
|
|
$
|
|
|||||||||||
|
Asset-backed securities
|
|
|
|
(
|
)
|
|
||||||||||||||
|
Long-term investments
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||||
|
|
December 31, 2022
|
|||||||||||||||||||
|
|
Maturity
|
Amortized
|
Unrealized
|
Unrealized
|
Estimated
|
|||||||||||||||
|
|
in Years
|
Cost
|
Gains
|
Losses
|
Fair Value
|
|||||||||||||||
|
Corporate debt securities
|
less than
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||
|
Commercial paper
|
less than
|
|
|
|
|
|||||||||||||||
|
U.S. Treasury securities
|
less than
|
|
|
(
|
)
|
|
||||||||||||||
|
U.S. Agency bonds
|
less than
|
|
|
|
|
|||||||||||||||
|
Short-term investments
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||||
|
|
||||||||||||||||||||
|
Corporate debt securities
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||
|
U.S. Agency bonds
|
|
|
|
(
|
)
|
|
||||||||||||||
|
Asset-backed securities
|
|
|
|
(
|
)
|
|
||||||||||||||
|
Long-term investments
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||||
The available-for-sale investments’ gross unrealized losses and fair value
aggregated by classes of security and length of time that individual securities have been in a continuous loss position at September 30, 2023 and December 31, 2022 consisted of the following (in thousands):
|
|
September 30, 2023
|
|||||||||||||||||||||||||||||||||||
|
|
Less than 12 months
|
More than 12 months
|
Total
|
|||||||||||||||||||||||||||||||||
|
|
Unrealized
|
Unrealized
|
Unrealized
|
|||||||||||||||||||||||||||||||||
|
|
Count
|
Fair Value
|
Losses
|
Count
|
Fair Value
|
Losses
|
Count
|
Fair Value
|
Losses
|
|||||||||||||||||||||||||||
|
Corporate debt securities
|
|
$
|
|
$
|
(
|
)
|
|
$
|
|
$
|
|
|
$
|
|
$
|
(
|
)
|
|||||||||||||||||||
|
Commercial paper
|
|
|
(
|
)
|
|
|
|
|
|
(
|
)
|
|||||||||||||||||||||||||
|
U.S. Treasury securities
|
|
|
(
|
)
|
|
|
|
|
|
(
|
)
|
|||||||||||||||||||||||||
|
U.S. Agency bonds
|
|
|
(
|
)
|
|
|
|
|
|
(
|
)
|
|||||||||||||||||||||||||
|
Asset-backed securities
|
|
|
(
|
)
|
|
|
(
|
)
|
|
|
(
|
)
|
||||||||||||||||||||||||
|
|
|
$
|
|
$
|
(
|
)
|
|
$
|
|
$
|
(
|
)
|
|
$
|
|
$
|
(
|
)
|
||||||||||||||||||