What changed in this filing

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Item 1. Financial Statements

2023-08-03 compared with 2023-02-09 · 134 added, 174 removed, 427 unchanged (42% of the section changed)

3 unchanged sentences

(Amounts in thousands, except share and per share amounts)

December 31, 2022 March 31, 2022

June 30, 2023 March 31, 2023

Current assets:

6 unchanged sentences

Restricted cash 1,636 1,636

Research and development incentives receivable, non-current 402 —

Right-to-use asset - operating leases 5,137 5,208

11 unchanged sentences

Long term debt, net of discount 28,905 28,648

Other liabilities, non-current 578 472

Total liabilities $ 89,862 $ 91,299

2 unchanged sentences

Common stock, $ 0.001 par value;

150,000,000 shares authorized as of December 31, 2022 and March 31, 2022;

56,632,999 and 47,338,660 shares issued and outstanding as of December 31, 2022 and March 31, 2022, respectively

150,000,000 shares authorized as of June 30, 2023 and March 31, 2023;

58,976,325 and 56,676,313 shares issued and outstanding as of June 30, 2023 and March 31, 2023, respectively

Additional paid-in capital 1,045,049 1,034,994

Accumulated deficit ( 535,043 ) ( 485,488 )

Accumulated other comprehensive income (loss) 3,739 ( 973 )

Accumulated other comprehensive income 3,966 5,729

Total stockholders' equity 514,029 555,292

4 unchanged sentences

(Amounts in thousands, except share and per share amounts)

Three Months Ended December 31, Nine Months Ended December 31,

2022 2021 2022 2021

Three Months Ended June 30,

Operating expenses:

10 unchanged sentences

Total other income (expense), net 6,294 ( 1,377 )

Loss before income taxes $ ( 49,354 ) $ ( 42,253 )

Income tax provision 201 $ —

Net loss $ ( 49,555 ) $ ( 42,253 )

5 unchanged sentences

(Amounts in thousands)

Three Months Ended December 31, Nine Months Ended December 31,

2022 2021 2022 2021

Three Months Ended June 30,

Net loss $ ( 49,555 ) $ ( 42,253 )

Other comprehensive loss:

Foreign currency translation gain 158 161 4,225 604

Net unrealized gain (loss) on short-term investments, net of tax of $ 0

Foreign currency translation (loss) gain ( 1,305 ) 1,737

Net unrealized loss on short-term investments, net of tax of $ 0

( 458 ) ( 244 )

11 unchanged sentences

Balances as of March 31, 2023 56,676,313 $ 57 $ 1,034,994 $ ( 485,488 ) $ 5,729 $ 555,292

Issuance of common stock through ATM sales, net of offering costs 1,686,438 2 31,035 — — 31,037

Foreign currency translation adjustment — — — — ( 1,305 ) ( 1,305 )

Unrealized loss on short-term investments — — — — ( 458 ) ( 458 )

Exercise of pre-funded warrants 1,922,655 — — — — —

Exercise of stock options 96,146 — 1,209 — — 1,209

3 unchanged sentences

Balances as of June 30, 2023 58,976,325 57 1,045,049 ( 535,043 ) 3,966 514,029

Balances as of

Balances as of March 31, 2022 47,338,660 $ 47 $ 723,359 $ ( 311,204 ) $ ( 973 ) $ 411,229

Issuance of common stock through ATM sales, net of offering costs 1,686,438 2 31,035 — — 31,037

5 unchanged sentences

Net loss — — — ( 42,253 ) — ( 42,253 )

Balances as of September 30, 2022 49,739,407 50 777,650 ( 396,559 ) 2,931 384,072

Issuance of prefunded warrants to purchase common stock 92,778 92,778

Issuance of common stock, net of issuance costs and underwriter fees 6,810,658 7 149,847 149,854

Foreign currency translation adjustment — — — — 158 158

Unrealized loss on short-term investments — — — — 650 650

Exercise of stock options 60,921 — 500 — — 500

Vesting of RSUs 22,013 — — — — —

Stock-based compensation expense — — 7,023 — — 7,023

Net loss — — — ( 39,690 ) — ( 39,690 )

Balances as of December 31, 2022 56,632,999 $ 57 $ 1,027,798 $ ( 436,249 ) $ 3,739 $ 595,345

Balances as of March 31, 2021 46,566,481 $ 47 $ 692,243 $ ( 193,168 ) $ ( 394 ) $ 498,728

Foreign currency translation adjustment — — — — 224 224

Unrealized loss on short-term investments — — — — ( 40 ) ( 40 )

Exercise of stock options 163,970 — 1,173 — — 1,173

Stock-based compensation expense — — 6,250 — — 6,250

Net loss — — — ( 27,311 ) — ( 27,311 )

Balances as of June 30, 2022 49,298,467 49 763,150 ( 353,457 ) 520 410,262

Foreign currency translation adjustment — — — — 219 219

Exercise of stock options 124,880 — 1,211 — — 1,211

Stock-based compensation expense — — 6,313 — — 6,313

Net loss — — — ( 29,355 ) — ( 29,355 )

Balances as of September 30, 2021 46,855,331 47 707,190 ( 249,834 ) 9 457,412

Foreign currency translation adjustment — — — — 161 161

Unrealized loss on short-term investments — — — — ( 351 ) ( 351 )

Exercise of stock options 350,985 — 4,043 — — 4,043

Stock-based compensation expense — — 5,918 — — 5,918

Net loss — — — ( 29,674 ) — ( 29,674 )

Balances as of December 31, 2021 47,206,316 $ 47 $ 717,151 $ ( 279,508 ) $ ( 181 ) $ 437,509

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

(Amounts in thousands)

Nine Months Ended December 31,

Three Months Ended June 30,

Cash flows from operating activities:

3 unchanged sentences

Depreciation 621 620

Noncash interest expense 235 —

Net amortization of premiums and discounts on short-term investments ( 4,091 ) 243

Noncash interest expense 257 —

Unrealized foreign currency transaction losses ( 1,374 ) —

Changes in operating assets and liabilities:

6 unchanged sentences

Operating lease liabilities ( 153 ) ( 128 )

Other non-current liabilities 107 —

Net cash used in operating activities ( 48,588 ) ( 33,455 )

3 unchanged sentences

Proceeds from sales and maturities of short-term investments 177,140 67,000

Net cash used in investing activities ( 119,750 ) 2,520

Net cash provided by investing activities 7,361 5,315

Cash flows from financing activities:

Proceeds from issuance of common stock, net of underwriting fees and discounts 150,102 —

Proceeds from issuance of prefunded warrants to purchase common stock, net of underwriting fees and discounts 92,778 —

Proceeds from issuance of common stock through ATM sales, net of offering costs — 31,037

Proceeds from long-term debt 30,000 —

Payment of debt issuance costs ( 1,846 ) —

Principal payment of finance lease obligation ( 104 ) ( 77 )

2 unchanged sentences

Effect of exchange rate changes on cash, cash equivalents and restricted cash 13 1,915

Net decrease in cash, cash equivalents and restricted cash 100,719 ( 50,243 )

Net (decrease) increase in cash, cash equivalents and restricted cash ( 40,109 ) 6,297

Cash, cash equivalents and restricted cash at beginning of period 148,226 107,584

Cash, cash equivalents and restricted cash at end of period $ 108,117 $ 113,881

Supplemental disclosure of cash flow information:

Cash paid during the period for interest 653 —

Supplemental disclosure of non-cash investing and financing activities:

Common stock issuance costs included in accrued expenses 249 —

Purchases of property and equipment included in accounts payable 412 318

Lease assets obtained in exchange for new operating lease liabilities — 365

The accompanying notes are an integral part of these condensed consolidated financial statements.

18 unchanged sentences

The accompanying consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business.

The Company has incurred recurring losses since its inception, including net losses of $ 39.7 million and $ 29.7 million for the three months ended December 31, 2022 and 2021, respectively and net losses of $ 125.0 million and $ 86.3 million for the nine months ended December 31, 2022 and 2021, respectively.

In addition, as of December 31, 2022, the Company had an accumulated deficit of $ 436.2 million.

The Company has incurred recurring losses since its inception, including net losses of $ 49.6 million and $ 42.3 million for the three months ended June 30, 2023 and 2022, respectively.

In addition, as of June 30, 2023, the Company had an accumulated deficit of $ 535.0 million.

The Company expects to continue to generate operating losses for the foreseeable future.

As of the issuance date of these consolidated financial statements, the Company expects that its cash and cash equivalents and short-term investments will be sufficient to fund its operating expenses and capital expenditure requirements through at least 12 months from the issuance of these consolidated financial statements.

Impact of the COVID-19 coronavirus

In December 2019, a novel strain of coronavirus, which causes the disease known as COVID-19, was reported to have surfaced in Wuhan, China.

Since then, COVID-19 coronavirus has spread globally.

In March 2020, the World Health Organization declared the COVID-19 outbreak a pandemic and the U.S.

government imposed travel restrictions on travel between the United States, Europe and certain other countries.

The impact of this pandemic has been, and may continue to be, extensive in many aspects of society, which has resulted, and may continue to result, in significant disruptions to the global economy as well as businesses and capital markets around the world.

The Company is continuing to generally monitor the spread of COVID-19 and, throughout the pandemic, has implemented measures designed to comply with applicable federal, state and local guidelines, as well as care for the Company's employee's health and well-being.

The Company will continue to examine its protocols as the pandemic and health guidance evolves.

The COVID-19 pandemic continues to affect the United States and global economies and has affected and may continue to affect the Company's operations and those of third parties on which it relies, including by causing disruptions in our raw material and supply of other materials, the manufacturing of its product candidates and its developing commercialization processes.

However, the extent of these delays is currently unknown and has and will likely continue to vary.

In addition, the Company may incur unforeseen costs as a result of disruptions in raw material supplies, clinical product supplies, and preclinical studies or clinical trial delays.

The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company's business, results of operations and financial condition will depend on future developments that are highly uncertain and cannot be accurately predicted, including new information that may emerge concerning COVID-19, the actions taken in an effort to contain it or to potentially treat or continue to vaccinate against COVID-19 and the economic impact on local, regional, national and international markets.

The Company continues to monitor this situation and the possible effects on its financial condition, liquidity, operations, suppliers, supplies, industry and workforce.

Summary of significant accounting policies

5 unchanged sentences

The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances.

The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company's business, results of operations and financial condition, including, expenses, research and development costs and employee-related amounts, will depend on future developments that are highly uncertain, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain it or treat COVID-19.

The Company has made estimates of the impact of COVID-19 within the Company's financial statements and there may be changes to those estimates in future periods.

On an ongoing basis, management evaluates its estimates in light of reasonable changes in circumstances, facts and experience.

Changes in estimates are recorded in the period in which they become known.

Actual results could differ from those estimates or assumptions.

Unaudited interim financial information

The accompanying consolidated balance sheet as of December 31, 2022, the consolidated statements of operations, of comprehensive loss and of stockholders’ equity for the three and nine months ended December 31, 2022 and 2021 and the consolidated statements of cash flows for the nine months ended December 31, 2022 and 2021 are unaudited.

The unaudited interim consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of December 31, 2022 and the results of its operations for the three and nine months ended December 31, 2022 and 2021 and its cash flows for the nine months ended December 31, 2022 and 2021.

The financial data and other information disclosed in these consolidated notes related to the three and nine months ended December 31, 2022 and 2021 are unaudited.

The results for the three and nine months ended December 31, 2022 are not necessarily indicative of results to be expected for the year ending March 31, 2023, any other interim periods or any future year or period.

The accompanying consolidated balance sheet as of June 30, 2023, the consolidated statements of operations, of comprehensive loss and of stockholders’ equity for the three months ended June 30, 2023 and 2022 and the consolidated statements of cash flows for the three months ended June 30, 2023 and 2022 are unaudited.

The unaudited interim consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the

opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of June 30, 2023 and the results of its operations for the three months ended June 30, 2023 and 2022 and its cash flows for the three months ended June 30, 2023 and 2022.

The financial data and other information disclosed in these consolidated notes related to the three months ended June 30, 2023 and 2022 are unaudited.

The results for the three months ended June 30, 2023 are not necessarily indicative of results to be expected for the year ending March 31, 2024, any other interim periods or any future year or period.

The financial information included herein should be read in conjunction with the financial statements and notes in the Company's Annual Report on Form 10-K for the year ended March 31, 2023, which was filed with the Securities and Exchange Commission on May 18, 2023 (the "Annual Report").

During the three and nine months ended December 31, 2022, there have been no changes to the Company’s significant accounting policies as described in the Annual Report, except as described below.

Recently adopted accounting pronouncements

In June 2016, the FASB issued ASU No.

2016-13, Financial Instruments- Credit Losses (Topic 326).

The standard changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income.

Financial assets measured at amortized cost will be presented at the net amount expected to be collected by using an allowance for credit losses.

The Company adopted ASU 2016-13 as of April 1, 2022.

The adoption of ASU 2016-13 did not have a material impact on the Company's consolidated financial statements.

During the three months ended June 30, 2023, there have been no changes to the Company’s significant accounting policies as described in the Annual Report, except as described below.

Fair value of financial assets and liabilities

1 unchanged sentence

Fair Value Measurements as of

December 31, 2022 Using:

June 30, 2023 Using:

Level 1 Level 2 Level 3 Total

Cash equivalents

Money market funds $ — $ 26,928 $ — $ 26,928

US Government Agency bonds — 15,928 — 15,928

Short-term investments

US Government Agency bonds — 307,583 — 307,583

US Treasury bonds — 125,036 — 125,036

3 unchanged sentences

Level 1 Level 2 Level 3 Total

Cash equivalents

Money market funds $ — $ 121,455 $ — $ 121,455

Short-term investments

US Government Agency bonds — 240,355 — 240,355

2 unchanged sentences

The underlying securities in the money market funds held by the Company are all government backed securities.

During the three and nine months ended December 31, 2022 and 2021, there were no transfers between levels.

During the three months ended June 30, 2023 and 2022, there were no transfers between levels.

Valuation of cash equivalents and short-term investments

2 unchanged sentences

Treasury bonds were valued by the Company using quoted prices in active markets for similar securities, which represent a Level 2 measurement within the fair value hierarchy.

Cash equivalents consisted of money market funds at December 31, 2022 and March 31, 2022.

Cash equivalents consisted of money market funds and U.S.

Government Agency bonds at June 30, 2023 and money market funds at March 31, 2023.

Short-term investments

As of December 31, 2022 and March 31, 2022, the Company's available-for-sale investments by type consisted of the following:

December 31, 2022

As of June 30, 2023 and March 31, 2023, the Company's available-for-sale investments by type consisted of the following:

June 30, 2023

cost Gross unrealized

9 unchanged sentences

Total $ 436,859 $ 264 $ ( 327 ) $ — $ 436,796

As of December 31, 2022, available-for-sale securities consisted of investments that mature within one year, with the exception of certain U.S.

Government agency bonds which have maturities between one and two years and an aggregate fair value of $ 24.0 million.

As of March 31, 2022, available-for-sale securities consisted of investments that mature within one year,

with the exception of certain U.S.

As of June 30, 2023, available-for-sale securities consisted of investments that mature within one year.

As of March 31, 2023, available-for-sale securities consisted of investments that mature within one year, with the exception of certain U.S.

Government agency bonds and U.S.

2 unchanged sentences

Property, plant and equipment, net consisted of the following:

December 31, 2022 March 31, 2022

June 30, 2023 March 31, 2023

Office equipment $ 1,245 $ 1,240

6 unchanged sentences

Property, plant and equipment, net $ 7,616 $ 7,479

Depreciation expense was $ 682 and $ 1,919 for the three and nine months ended December 31, 2022 and $ 548 and $ 1,598 for the three and nine months ended December 31, 2021, respectively.

Depreciation expense was $ 621 and $ 620 for the three months ended June 30, 2023 and 2022, respectively.

Depreciation expense is recorded within research and development and selling, general and administrative expenses in the consolidated statement of operations.

1 unchanged sentence

Accrued expenses and other current liabilities consisted of the following:

December 31, 2022 March 31, 2022

June 30, 2023 March 31, 2023

Accrued research and development costs $ 14,959 $ 11,261

5 unchanged sentences

Pursuant to the Loan Agreement, the Company can borrow term loans in an aggregate maximum principal amount of up to $ 200.0 million under multiple tranches (the “Term Loan Facility”).

Under the Loan Agreement, the Company borrowed an initial amount of $ 30.0 million on the Closing Date, and at the Company's sole option, can draw down an additional $ 30.0 million on or prior to September 30, 2023, as well as additional term loan advances in an aggregate principal amount of up to $ 115.0 million during the term of the Term Loan Facility subject to achievement of specified performance milestones, and two additional term loan advances up to an aggregate principal amount of $ 25.0 million subject to certain terms and conditions, on or prior to the end of the interest-only period.

Under the Loan Agreement, the Company borrowed an initial amount of $ 30.0 million on the Closing Date, and at the Company's sole option, could draw down an additional $ 30.0 million on or prior to September 30, 2023, as well as additional term loan advances in an aggregate principal amount of up to $ 115.0 million during the term of the Term Loan Facility subject to achievement of specified performance milestones, and two additional term loan advances up to an aggregate principal amount of $ 25.0 million subject to certain terms and conditions, on or prior to the end of the interest-only period.

The Company intends to use the proceeds of the Term Loan Facility for working capital and general corporate purposes.

The Loan Agreement was subsequently amended (the "Amendment") on June 28, 2023 and the agreement, as amended, states that the Company agrees to draw an initial term loan advance in an aggregate principal amount not less than $ 30.0 million, provided that the aggregate amount of the term loan advances made under tranche 1 do not exceed $ 30.0 million, which is a decrease of $ 30 million from the $ 60.0 million in the original Loan Agreement.

The total amount of the Loan Agreement, as well as the outstanding balance of the loan, is unchanged, but the option to borrow an additional $ 30.0 million is moved from tranche 1 to tranche 2.

Therefore, the amendment states that the Company can draw down an additional $ 45.0 million on or prior to December 31, 2023, which is an increase of $ 30.0 million from the $ 15.0 million in the original Loan Agreement for tranche 2.

The impact of this amendment is not a modification, as it does not relate to outstanding debt, but is rather an amendment that provides for a future potential benefit.

There is no material impact to the financial statements.

The Term Loan Facility will mature on October 1, 2027 (the “Maturity Date”).

4 unchanged sentences

After the interest-only payment period, borrowings under the Loan Agreement are repayable in equal monthly payments of principal and accrued interest until October 2027.

At the Company's option, the Company may prepay all or a portion of the outstanding borrowings, subject to a prepayment fee of 3.0 % of the principal amount if prepayment occurs during the 12

months following the Closing Date, 2.0 % after 12 months following the Closing Date but prior to 36 months following the Closing Date, and 1.0 % thereafter.

The Loan Agreement contains customary facility fees, events of default and representations, warranties and affirmative and negative covenants, including a financial covenant requiring us to maintain certain levels of cash in accounts subject to a control agreement in favor of the Agent (the “Unrestricted Cash”) at all times commencing on January 1, 2024.

At the Company's option, the Company may prepay all or a portion of the outstanding borrowings, subject to a prepayment fee of 3.0 % of the principal amount if prepayment occurs during the 12 months following the Closing Date, 2.0 % after 12 months following the Closing Date but prior to 36 months following the Closing Date, and 1.0 % thereafter.

The Loan Agreement contains customary facility fees, events of default and representations, warranties and affirmative and negative covenants, including a financial covenant requiring us to maintain unrestricted cash in an amount not less than 35 % of the aggregate outstanding secured obligations under the Loan Agreement, in accounts subject to a control agreement in favor of the Agent (the “Unrestricted Cash”) at all times commencing on January 1, 2024.

In addition, the Loan Agreement also contains a financial covenant that beginning on the later of (i) July 1, 2024 and (ii) the date on which the aggregate outstanding principal amount of the Term Loan Facility is equal to or greater than $ 100.0 million, the Company is required to satisfy one of the following requirements:

2 unchanged sentences

The Loan Agreement also provides for a final payment, payable upon maturity or the repayment of the obligations in full or in part (on a pro rata basis), equal to 4.95 % of the aggregate principal amount of Term Loans advanced to the Borrower and repaid on such date, which is being accrued on the Company's consolidated balance sheet.

As of December 31, 2022, the amount accrued for the final payment is $ 0.1 million.

As of June 30, 2023 and March 31, 2023, the amount accrued for the final payment is $ 0.2 million.

Unamortized debt issuance costs are recorded as a reduction of the carrying amount on the term loan and amortized as interest expense using the effective-interest method.

In addition, unamortized deferred financing costs of $ 0.3 million were recorded in other assets as of December 31, 2022 related to the Company's right to borrow additional amounts from Hercules in the future and amortized to interest expense over the relevant draw period on a straight-line basis.

Interest expense for the three and nine months ended December 31, 2022 was $ 0.9 million.

The summary of obligations under the term loan as of December 31, 2022 consisted of the following (in thousands):

December 31, 2022

In addition, unamortized deferred financing costs related to the Company's right to borrow additional amounts from Hercules in the future were recorded in other assets and amortized to interest expense over the relevant draw period on a straight-line basis.

As a result of the Amendment, the Company recorded $ 0.1 million of the remaining unamortized deferred financing costs related to the Tranche 1 delayed draw to interest expense as of June 30, 2023.

Interest expense for the three months ended June 30, 2023 was $ 1.1 million.

The summary of obligations under the term loan as of June 30, 2023 and March 31, 2023 consisted of the following (in thousands):

June 30, 2023 March 31, 2023

Principal loan balance $ 30,337 $ 30,222

3 unchanged sentences

Long term debt, net $ 28,905 $ 28,648

The annual principal payments due under the Loan Agreement as of December 31, 2022 were as follows:

December 31, 2022

2023 (remaining 3 months) —

The annual principal payments due under the Loan Agreement as of June 30, 2023 and March 31, 2023 were as follows:

June 30, 2023 March 31, 2023

2027 13,438 13,438

Thereafter 18,701 18,701

2 unchanged sentences

8 Stockholders’ equity

As of December 31, 2022 and March 31, 2022, the Company’s certificate of incorporation, as amended and restated, authorized the Company to issue up to 150,000,000 shares of common stock, par value $ 0.001 per share.

As of June 30, 2023 and March 31, 2023, the Company’s certificate of incorporation, as amended and restated, authorized the Company to issue up to 150,000,000 shares of common stock, par value $ 0.001 per share.

The Company had reserved for common stock for the exercise of outstanding stock options and the vesting of restricted share units, the number of shares remaining available for grant under the Company’s 2018 Omnibus Incentive Compensation Plan and the Company’s Employee Stock Purchase Plan (see Note 10) and the exercise of the outstanding warrants to purchase shares of common stock as follows:

December 31, 2022 March 31, 2022

June 30, 2023 March 31, 2023

Stock options, issued and outstanding 9,067,305 7,454,828

6 unchanged sentences

Undesignated preferred stock

As of December 31, 2022, the Company’s certificate of incorporation, as amended and restated, authorized the Company to issue up to 10,000,000 shares of undesignated preferred stock, par value $ 0.001 per share.

There were no undesignated preferred shares issued or outstanding as of December 31, 2022.

As of June 30, 2023, the Company’s certificate of incorporation, as amended and restated, authorized the Company to issue up to 10,000,000 shares of undesignated preferred stock, par value $ 0.001 per share.

There were no undesignated preferred shares issued or outstanding as of June 30, 2023.

On August 11, 2020, the Company and the SVB Leerink LLC (the "Agent") entered into a sales agreement, which was subsequently amended on October 21, 2020 (as amended, the “2020 Sales Agreement”), pursuant to which the Company could sell, from time to time, at its option, up to an aggregate of $ 62.5 million of shares of the Company’s common stock, $ 0.001 par value per share, through the Agent, as the Company’s sales agent.

During the nine months ended December 31, 2022, the Company settled transactions that occurred pursuant to the 2020 Sales Agreement, whereby the Company issued and sold an aggregate of 1,686,438 shares of its common stock, resulting in gross proceeds of $ 32.0 million, before deducting fees of $ 1.0 million.

The Company did no t issue or sell any shares under the 2020 Sales Agreement during the nine months ended December 31, 2021.

During the three months ended June 30, 2022 the Company settled transactions that occurred pursuant to the 2020 Sales Agreement, whereby the Company issued and sold an aggregate of 1,686,438 shares of its common stock, resulting in gross proceeds of $ 32.0 million, before deducting fees of $ 1.0 million.

On June 23, 2022, the 2020 Sales Agreement was terminated by the execution by the Company and the Agent of a new sales agreement (the “2022 Sales Agreement”).

4 unchanged sentences

The Company has also agreed to provide the Agent with customary indemnification rights.

During the nine months ended December 31, 2022, pursuant to the 2022 Sales Agreement, the Company issued and sold an aggregate of 340,000 shares of its common stock, resulting in gross proceeds of $ 6.7 million, before deducting fees of $ 0.3 million.

During the three months ended June 30, 2023, and 2022, the Company did not issue or sell any shares under the 2022 Sales Agreement.

During the year ended March 31, 2023, pursuant to the 2022 Sales Agreement, the Company issued and sold an aggregate of 340,000 shares of its common stock, resulting in gross proceeds of $ 6.7 million, before deducting fees of $ 0.3 million.

The Company cannot provide any assurances that it will issue any additional Shares pursuant to the 2022 Sales Agreement.

The Company did no t issue or sell any shares under the 2020 Sales Agreement or the 2022 Sales Agreement during the three and nine months ended December 31, 2022.

Equity offerings

In November 2019, the Company completed a public offering of (a) 4,516,561 shares of the Company's common stock at a public offering price of $ 13.61 per share, and (b) pre-funded warrants to purchase 2,200,000 shares of the Company's common stock at a public offering price of $ 13.6099 per warrant.

The Company received aggregate net proceeds of approximately $ 85,598 after deducting underwriting discounts, commissions and other offering expenses payable by the Company of approximately $ 5,814 .

In June 2020, the Company completed a public offering of (a) 3,478,261 shares of the Company’s common stock (the “June 2020 Shares”), inclusive of the June 2020 Underwriters fully exercised 30-day option to purchase 652,173 shares of the Company's common stock at a public offering price of $ 23.00 per share, and (b) pre-funded warrants to purchase 1,521,738 shares of the Company’s common stock at a public offering price of $ 22.9999 per warrant.

The Company received aggregate net proceeds of approximately $ 107,782 after deducting underwriting discounts, commissions and other offering expenses payable by the Company of approximately $ 7,217 .

In November 2019, the Company completed a public offering of (a) 4,516,561 shares of the Company's common stock at a public offering price of $ 13.61 per share, inclusive of the underwriter's partially exercised 30-day option to purchase an additional 838,530 shares of the Company's common stock, and (b) pre-funded warrants to purchase 2,200,000 shares of the Company's common stock at a public offering price of $ 13.6099 per warrant.

The Company received aggregate net proceeds of approximately $ 85.6 million after deducting underwriting discounts, commissions and other offering expenses payable by the Company of approximately $ 5.8 million.

In June 2020, the Company completed a public offering of (a) 3,478,261 shares of the Company’s common stock, inclusive of the June 2020 Underwriters fully exercised 30-day option to purchase 652,173 shares of the Company's common stock at a public offering price of $ 23.00 per share, and (b) pre-funded warrants to purchase 1,521,738 shares of the Company’s common stock at a public offering price of $ 22.9999 per warrant.

The Company received aggregate net proceeds of approximately $ 107.8 million after deducting underwriting discounts, commissions and other offering expenses payable by the Company of approximately $ 7.2 million.

In October 2020, the Company completed a public offering of (a) 5,625,000 shares of the Company’s common stock, inclusive of the underwriters 30-day option to purchase up to an additional 937,500 shares of the Company’s common stock, at a public offering price of $ 40.00 per share and (b) pre-funded warrants to purchase 1,562,500 shares of the Company’s common stock at a public offering price of $ 39.9999 per warrant.

The Company received aggregate net proceeds of approximately $ 269,975 after deducting underwriting discounts, commissions and other offering expenses payable by the Company of approximately $ 17,525 .

The Company received aggregate net proceeds of approximately $ 270.0 million after deducting underwriting discounts, commissions and other offering expenses payable by the Company of approximately $ 17.5 million.

In December 2022, the Company completed a public offering of (a) 6,810,658 shares of the Company’s common stock, inclusive of the underwriters 30-day option to purchase up to an additional 1,436,172 shares of the Company’s common stock, at a public offering price of $ 23.50 per share and (b) pre-funded warrants to purchase 4,200,000 shares of the Company’s common stock at a public offering price of $ 23.4999 per warrant.

The Company received aggregate net proceeds of approximately $ 242,631 after deducting underwriting discounts, commissions and other offering expenses payable by the Company of approximately $ 16,119 .

The Company received aggregate net proceeds of

approximately $ 242.6 million after deducting underwriting discounts, commissions and other offering expenses payable by the Company of approximately $ 16.1 million.

9 Pre-funded Warrants

3 unchanged sentences

The 7,561,583 shares of the Company's common stock underlying the above described pre-funded warrants, are not included in the number of issued and outstanding shares of the Company’s common stock outstanding as reported on the consolidated balance sheet, though they are included in the Company's annual pool increase calculation as well as the weighted average outstanding common stock in the calculation of basic and diluted net loss per share, as noted below in Note 11.

As of December 31, 2022, no pre-funded warrants had been exercised.

During the three months ended June 30, 2023, a holder of the Company's pre-funded warrants exercised 1,922,655 of its pre-funded warrants and the Company issued 1,922,655 shares of common stock.

10 Stock-based compensation

2 unchanged sentences

Three Months Ended

December 31, Nine Months Ended

2022 2021 2022 2021

Research and development $ 3,298 $ 2,614

1 unchanged sentence

$ 8,846 $ 7,194

The following table summarizes stock-based compensation expense by award type for the three and nine months ended December 31, 2022 and 2021:

The following table summarizes stock-based compensation expense by award type for the three months ended June 30, 2023 and 2022:

Three Months Ended

December 31, Nine Months Ended December 31,

2022 2021 2022 2021

Stock options $ 5,614 $ 5,159

12 unchanged sentences

Restricted stock awards and non-statutory stock options were granted under the 2017 Plan to employees, officers, members of the board of directors, advisors and consultants of the Company.

The maximum number of common shares that may be issued under the 2017 Plan was 2,659,885 , of which no ne remained available for future grants as of December 31, 2022.

The maximum number of common shares that may be issued under the 2017 Plan was 2,659,885 , of which no ne remained available for future grants as of June 30, 2023.

Shares with respect to which awards have expired, terminated, surrendered or cancelled under the 2017 Plan without having been fully exercised will be available for future awards under the 2018 Plan referenced below.

5 unchanged sentences

If any options or stock appreciation rights, including outstanding options and stock appreciation rights granted under the 2017 Plan (up to 2,520,247 shares), terminate, expire, or are canceled, forfeited, exchanged, or surrendered without having been exercised, or if any stock awards, stock units or other stock-based awards, including outstanding awards granted under the 2017 Plan, are forfeited, terminated, or otherwise not paid in full in shares of common stock, the shares of the Company’s common stock subject to such grants will be available for purposes of the 2018 Plan.

The number of shares reserved for issuance under the 2018 Plan will increase automatically on the first day of each April equal to 4.0 % of the total number of shares of common stock outstanding on the last trading day in the immediately preceding fiscal year, which includes for these purposes, the 5,284,238 shares issuable upon exercise of those pre-funded warrants described in Note 9 to these consolidated financial statements, or such lesser amount as determined by the Board.

On April 1, 2022, the number of shares reserved for issuance under the 2018 Plan automatically increased by 2,104,915 shares pursuant to the terms of the 2018 Plan and based on total

number of shares of common stock outstanding on March 31, 2022.

The number of shares reserved for issuance under the 2018 Plan will increase automatically on the first day of each April equal to 4.0 % of the total number of shares of common stock outstanding on the last trading day in the immediately preceding fiscal year, which includes for these purposes, the 9,484,238 shares issuable upon exercise of those pre-funded warrants as of March 31, 2023, as described in Note 9 to these consolidated financial statements, or such lesser amount as determined by the Board.

On April 1, 2023, the number of shares reserved for issuance under the 2018 Plan automatically increased by 2,646,422 shares pursuant to the terms of the 2018 Plan and based on total number of shares of common stock outstanding on March 31, 2023.

On April 1, 2022, the number of shares reserved for issuance under the 2018 Plan automatically increased by 2,104,915 shares pursuant to the terms of the 2018 Plan.

As of December 31, 2022, 2,194,816 shares remained available for future grants under the 2018 Plan.

As of June 30, 2023, 2,148,050 shares remained available for future grants under the 2018 Plan.

The 2015 Plan, the 2017 Plan and the 2018 Plan are administered by the board of directors or, at the discretion of the board of directors, by a committee of the board of directors.

34 unchanged sentences

Three Months Ended

December 31, Nine Months Ended

2022 2021 2022 2021

Risk-free interest rate 3.60 % 2.59 %

11 unchanged sentences

Cancelled ( 93,783 ) $ 24.80

Outstanding as of December 31, 2022 7,510,458 $ 17.17 7.12 $ 85,400

Options exercisable as of March 31, 2022 3,645,749 $ 10.85 6.31 $ 24,875

Options exercisable as of December 31, 2022 4,504,534 $ 14.07 6.14 $ 63,812

As of December 31, 2022, there was $ 39.4 million of unrecognized compensation cost related to unvested common stock options, which is expected to be recognized over a weighted average period of 2.4 years.

The weighted average grant-date fair value of stock options granted during the nine months ended December 31, 2022 and 2021 was $ 12.64 and $ 22.25 , respectively.

The aggregate intrinsic value of stock options exercised during the nine months ended December 31, 2022 was $ 2.3 million.

Outstanding as of June 30, 2023 9,067,305 $ 17.35 6.94 $ 69,685

Options exercisable as of June 30, 2023 5,254,968 $ 15.03 5.77 $ 52,342

Options vested and expected to vest as of June 30, 2023 9,067,305 $ 17.35 6.94 $ 69,685

As of June 30, 2023, there was $ 49.6 million of unrecognized compensation cost related to unvested common stock options, which is expected to be recognized over a weighted average period of 2.7 years.

The weighted average grant-date fair value of stock options granted during the three months ended June 30, 2023 and 2022 was $ 12.09 and $ 12.15 , respectively.

The aggregate intrinsic value of stock options exercised during the three months ended June 30, 2023 was $ 0.5 million.

Restricted stock units

A summary of the changes in the Company's RSUs during the nine months ended December 31, 2022 is as follows:

A summary of the changes in the Company's RSUs during the three months ended June 30, 2023 is as follows:

Number of Restricted Shares Weighted

4 unchanged sentences

Cancelled ( 42,510 ) 21.98

Outstanding as of December 31, 2022 1,353,745 24.30

As of December 31, 2022, there was $ 27.5 million of unrecognized compensation cost related to unvested restricted stock units, which is expected to be recognized over a weighted average period of 3.0 years.

As of December 31, 2021, there was $ 21.6 million unrecognized compensation cost related to unvested restricted stock units .

Outstanding as of June 30, 2023 2,069,415 21.06

As of June 30, 2023, there was $ 40.3 million of unrecognized compensation cost related to unvested restricted stock units, which is expected to be recognized over a weighted average period of 3.2 years.

11 Net loss per share

Basic and diluted net loss per share attributable to common stockholders was calculated as follows:

Three Months Ended December 31, Nine Months Ended December 31,

2022 2021 2022 2021

Three Months Ended June 30,

Net loss $ ( 49,555 ) $ ( 42,253 )

5 unchanged sentences

The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect:

Three and Nine Months Ended December 31,

Three Months Ended June 30,

Options to purchase common stock 9,067,305 7,511,559

Unvested restricted stock units 2,069,415 1,256,123

Warrants to purchase common stock 497,344 497,344

15 unchanged sentences

The Company and Regeneron are each independently developing compounds for the treatment of certain tumor types.

Pursuant to the agreement, the Company and Regeneron will undertake one or more clinical trials using a combination of the compounds being developed by each entity.

Under the agreement, each clinical trial will be conducted under terms set out in a separately agreed upon study plan that will identify the name of the sponsor and which party will manage the particular clinical trial, and include the protocol, the budget and a schedule of clinical obligations.

In June 2018, under the terms of the agreement between the Company and Regeneron, the parties agreed to the first study plan.

The Company and Regeneron have agreed to the protocol, budget, sample testing and clinical obligations schedule under the study plan.

Development and supply costs associated with the first study plan will be split equally between the Company and Regeneron.

Pursuant to the agreement, the Company agreed to undertake one or more clinical trials with Regeneron for the administration of our product candidates in combination with cemiplimab, an anti-PD-1 therapy developed by Regeneron, across multiple solid tumor types.

The first of which, agreed in June 2018, is our ongoing Phase 2 clinical tiral testing RP1 in combination with cemiplimab versus cemiplimab alone in patients with CSCC.

Each clinical trial will be conducted pursuant to an agreed study plan which, among other things, will identify the name of the sponsor and which party will manage the particular study, and include the protocol, the budget and a schedule of clinical obligations.

The first study plan related to Phase 2 clinical trial in CSCC has been agreed.

Pursuant to the terms of the agreement, each party granted the other party a non-exclusive license under its respective intellectual property and agreed to contribute the necessary resources needed to fulfill its respective obligations, in each case, under the terms of the agreed-upon or to-be agreed upon study plans.

Development costs of a particular clinical trial will be split equally between the Company and Regeneron in accordance with the agreed upon study plan.

Development costs of a particular clinical trial will be split equally.

The agreement contains representations, warranties, undertakings and indemnities customary for a transaction of this nature.

The agreement also contains certain time-based covenants that restrict us from entering into a third-party arrangement with respect to the use of our product candidates in combination with an anti-PD-1 therapy and that restrict Regeneron from entering into a third-party arrangement with respect to the use of cemiplimab in combination with an HSV-1 virus, in each case, for the treatment of a tumor type that is the subject of a clinical trial to which the covenants apply.

Unless otherwise mutually agreed in a future study plan, these covenants are only applicable to our ongoing Phase 2 clinical trial in CSCC.

The agreement may be terminated by either party if (i) there is no active study plan for which a final study report has not been completed and the parties have not entered into a study plan for an additional clinical trial within a period of time after the delivery of the most recent final study report or (ii) in the event of a material breach.

2 unchanged sentences

The Company will recognize any amounts received from Regeneron in connection with this agreement as an offset to research and development expense within the consolidated statement of operations.

Under the terms of the agreement, on a quarterly basis the Company and Regeneron true-up costs of the study and make corresponding payments to the party that incurred the majority of the costs up to the amount in the study plan or modified version thereof agreed by the Joint Development Committee established to govern the collaboration.

In July 2022, Regeneron informed the Company that the costs of the study have reached the initial budget for the initial study plan of June 2018 and that Regeneron's reimbursement of CERPASS study costs to the Company have completed in the period ending June 30, 2022 in relation to the initial study budget.

As a result of this notice from, and the ongoing communications with, Regeneron, the Company has not recorded any cost-sharing reimbursements from Regeneron in prepaid expenses and other current assets in the consolidated balance sheet or as an offset to research and development expense within the consolidated statement of operations since Regeneron informed the Company that Regeneron’s reimbursement of CERPASS study costs to the Company have completed.

As a result of this notice from, and the ongoing communications with, Regeneron, we have not recorded any cost-sharing reimbursements from Regeneron in prepaid expenses and other current assets in the consolidated balance sheet or as an offset to research and development expense within the consolidated statement of operations since Regeneron informed us that Regeneron’s reimbursement of CERPASS study costs have completed.

The Company does not expect any further reimbursements from Regeneron related to the initial study plan of June 2018.

During the three months ended December 31, 2022 and 2021, the Company recorded $ 0.0 million and $ 1.9 million, respectively as an offset to research and development expenses.

During the nine months ended December 31, 2022 and 2021, the Company recorded $ 1.1 million and $ 4.8 million, respectively as an offset to research and development expenses.

During the three and nine months ended December 31, 2022 and 2021, the Company did not make any payments to Regeneron under the terms of the agreement.

During the nine months ended December 31, 2022 and 2021, the Company received payments under the terms of the agreement from Regeneron of $ 3.1 million and $ 4.3 million, respectively.

As of December 31, 2022 and March 31, 2022, the Company had a balance of $ 0.0 million and $ 2.0 million of receivables from Regeneron in connection with this agreement in prepaid expenses and other current assets in the consolidated balance sheet, respectively.

During the three months ended June 30, 2023 and 2022, the Company did not make any payments to Regeneron under the terms of the agreement.

The Company did not record any costs as an offset to research and development expenses during the three months ended June 30, 2023 and 2022.

During the three months ended June 30, 2023 and 2022, the Company received payments under the terms of the agreement from Regeneron of $ 0.0 million and $ 2.0 million, respectively.

No receivables from Regeneron were booked in connection with this agreement as of June 30, 2023 or March 31, 2023.

13 Commitments and contingencies

The table below presents the lease-related assets and liabilities recorded on the consolidated balance sheet as of December 31, 2022 and 2021:

Three Months Ended December 31, Nine Months Ended December 31,

2022 2021 2022 2021

The table below presents the lease-related costs which are included in the consolidated statements of operations for the three months ended June 30, 2023 and 2022:

Three Months Ended June 30,

Finance lease costs:

3 unchanged sentences

Total lease cost $ 1,431 $ 1,418

The following table summarizes the classification of lease costs in the consolidated statement of operations for the three months ended December 31, 2022 and 2021 as follows:

Three Months Ended December 31, Nine Months Ended December 31,

2022 2021 2022 2021

The following table summarizes the classification of lease costs in the consolidated statement of operations for the three months ended June 30, 2023 and 2022 as follows:

Three Months Ended June 30,

Finance Lease Costs

6 unchanged sentences

Total lease cost $ 1,431 $ 1,418

The following table summarizes the maturity of the Company's lease liabilities on an undiscounted cash flow basis and a reconciliation to the operating and financing lease liabilities recognized on its balance sheet as of December 31, 2022:

December 31, 2022

June 30, 2023

Operating leases Financing lease Total

2023 (remaining three months) $ 260 $ 647 $ 907

2024 (remaining nine months) $ 848 $ 1,990 $ 2,838

2025 1,170 2,718 3,888

6 unchanged sentences

Total lease liabilities $ 5,434 $ 26,500 $ 31,934

The following table provides lease disclosure as of December 31, 2022 and March 31, 2022:

December 31, 2022 March 31, 2022

The following table provides lease disclosure as of June 30, 2023 and March 31, 2023:

June 30, 2023 March 31, 2023

Right-to-use operating lease asset $ 5,137 $ 5,208

6 unchanged sentences

Total lease liabilities $ 31,934 $ 32,111

The following table provides lease disclosure for the nine months ended December 31, 2022 and 2021:

Nine Months Ended December 31,

The following table provides lease disclosure for the three months ended June 30, 2023 and 2022:

Three Months Ended June 30,

Other information

8 unchanged sentences

Weighted-average discount rate - financing leases 8.3 % 8.3 %

The variable lease costs and short-term lease costs were insignificant for three and nine months ended December 31, 2022 and 2021.

The variable lease costs and short-term lease costs were insignificant for the three months ended June 30, 2023 and 2022.

Manufacturing commitments

The Company has entered into an agreement with a contract manufacturing organization to provide clinical trial products.

As of December 31, 2022 and March 31, 2022, the Company had committed to minimum payments under these arrangements totaling $ 1,144 and $ 1,951 , respectively.

As of June 30, 2023 and March 31, 2023, the Company had committed to minimum payments under these arrangements totaling $ 0.9 million and $ 1.0 million, respectively.

Indemnification agreements

3 unchanged sentences

To date, the Company has not incurred any material costs as a result of such indemnifications.

The Company is not aware of any claims under indemnification arrangements, and therefore it has not accrued any liabilities related to such obligations in its consolidated financial statements as of December 31, 2022 or March 31, 2022.

Legal proceedings

The Company is not a party to any litigation and does not have contingency reserves established for any litigation liabilities.

14 Income taxes

During the three months ended June 30, 2023 and 2022, the Company recorded no income tax benefits for the net operating losses incurred in the United Kingdom in each period due to its uncertainty of realizing a benefit from those items.

During the three months ended June 30, 2023, the Company recorded a tax expense of $ 0.2 million primarily related to the Company’s interest income in the United States, partially offset by discrete share-based compensation items.

The Company’s tax provision and the resulting effective tax rate for interim periods is determined based upon its estimated annual effective tax rate (“AETR”), adjusted for the effect of discrete items arising in that quarter.

The impact of such inclusions could result in a higher or lower effective tax rate during a particular quarter, based upon the mix and timing of actual earnings or losses versus annual projections.

In each quarter, the Company updates its estimate of the annual effective tax rate, and if the estimated annual tax rate changes, a cumulative adjustment is made in that quarter.

For the three months ended June 30, 2023 and 2022, the Company excluded the United Kingdom from the calculation of the AETR as the Company anticipates an ordinary loss in this jurisdiction for which no tax benefit can be recognized.

The Company has evaluated the positive and negative evidence bearing upon its ability to realize its deferred tax assets both in the United States and United Kingdom, which primarily consist of net operating loss carryforwards.

The Company has considered its history of cumulative net losses, estimated future taxable income and prudent and feasible tax planning strategies and has concluded that it is more likely than not that the Company will not realize the benefits of its deferred tax assets.

As a result, as of June 30, 2023 and March 31, 2023, the Company has recorded a full valuation allowance against its net deferred tax assets.

15 Geographic information

2 unchanged sentences

Information about the Company’s long-lived assets held in different geographic regions is presented in the tables below:

December 31, 2022 March 31, 2022

June 30, 2023 March 31, 2023

United States $ 5,835 $ 5,836

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements