What changed in this filing

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Item 1. Financial Statements

2021-11-08 compared with 2021-08-10 · 62 added, 44 removed, 342 unchanged (24% of the section changed)

3 unchanged sentences

(in thousands, except share and per share amounts)

September 30,

Current assets:

21 unchanged sentences

authorized, 36,780,393 and 36,577,149 shares issued and outstanding as

of June 30, 2021 and December 31, 2020, respectively

of September 30, 2021 and December 31, 2020, respectively

Additional paid-in capital

7 unchanged sentences

(in thousands, except share and per share amounts)

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine months ended

September 30,

Operating expenses:

11 unchanged sentences

Other comprehensive loss:

Unrealized loss on marketable securities

Unrealized gain (loss) on marketable securities

Total other comprehensive loss

14 unchanged sentences

Balance as of June 30, 2020

Stock-based compensation

Issuance of common stock upon exercise of stock options

Issuance of common stock related to employee stock purchase plan

Balance as of September 30, 2020

Balance as of December 31, 2020

8 unchanged sentences

Balance as of June 30, 2021

Unrealized loss on marketable securities

Stock-based compensation

Issuance of common stock upon exercise of stock options

Issuance of common stock related to employee stock purchase plan

Balance as of September 30, 2021

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

2 unchanged sentences

(in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows from operating activities:

15 unchanged sentences

Proceeds from issuance of common stock upon exercise of stock options

Deferred Financing Costs

Payments of follow-on offering costs

5 unchanged sentences

Property and equipment included in accrued expense and accounts payable

Right-of-use asset recognized upon entering into amended lease

Right of use asset recognized in exchange for operating lease

Right-of-use assets recognized in exchange for operating leases

14 unchanged sentences

(“Cantor”) and Stifel, Nicolaus & Company, Incorporated, (“Stifel”), under which the Company may, from time to time, offer and sell common stock having an aggregate offering value of up to $ 150.0 million, referred to as our “at-the-market” offering with Cantor and Stifel.

As of June 30, 2021, no such shares of the Company’s common stock had been offered or sold pursuant to this “at-the-market” program with Cantor and Stifel.

As of September 30, 2021, no such shares of the Company’s common stock had been offered or sold pursuant to this “at-the-market” program with Cantor and Stifel.

The Company may terminate this at-the-market program at any time, pursuant to its terms.

17 unchanged sentences

Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the Company’s consolidated financial statements and related footnotes as of and for the year ended December 31, 2020, which was filed with the SEC on March 9, 2021.

The Company’s financial information as of June 30, 2021, and for the six months ended June 30, 2021 and 2020 is unaudited, but in the opinion of management, all adjustments, consisting only of normal recurring adjustments, considered necessary for a fair presentation of the financial position, results of operations and cash flows at the dates and for the periods presented of the results of these interim periods have been included.

The Company’s financial information as of September 30, 2021, and for the nine months ended September 30, 2021 and 2020 is unaudited, but in the opinion of management, all adjustments, consisting only of normal recurring adjustments, considered necessary for a fair presentation of the financial position, results of operations and cash flows at the dates and for the periods presented of the results of these interim periods have been included.

The balance sheet information as of December 31, 2020 was derived from audited financial statements.

5 unchanged sentences

Cash, cash equivalents and restricted cash

The Company considers all highly liquid investments with an original maturity of six months or less at the date of purchase to be cash equivalents.

The Company considers all highly liquid investments with an original maturity of nine months or less at the date of purchase to be cash equivalents.

The Company deposits its cash in checking, sweep and money market accounts.

At June 30, 2021, restricted cash consisted of money market accounts collateralizing letters of credit issued as security deposits in connection with the Company’s leases of its corporate facilities.

At September 30, 2021, restricted cash consisted of money market accounts collateralizing letters of credit issued as security deposits in connection with the Company’s leases of its corporate facilities.

Cash and cash equivalents, and restricted cash in the condensed consolidated statements of cash flows consists of the following (in thousands):

As of June 30,

As of September 30,

Cash and cash equivalents

66 unchanged sentences

The following tables present information about the Company’s financial assets measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values (in thousands):

Fair value measurements as of June 30, 2021

Fair value measurements as of September 30, 2021

Cash equivalents:

14 unchanged sentences

The Company’s assets with fair value categorized as Level 1 within the fair value hierarchy include money market funds.

Money market funds are publicly traded mutual funds and are presented as cash equivalents on the condensed consolidated balance sheets as of June 30, 2021 and December 31, 2020.

Money market funds are publicly traded mutual funds and are presented as cash equivalents on the condensed consolidated balance sheets as of September 30, 2021 and December 31, 2020.

The Company measures its marketable securities at fair value on a recurring basis and classifies those instruments within Level 2 of the fair value hierarchy.

2 unchanged sentences

Substantially all of these assumptions are observable in the marketplace, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace.

There were transfers among the Level 1 to Level 2 category in the June 30, 2021 period presented.

There were transfers among the Level 1 to Level 2 category in the September 30, 2021 period presented.

There were no transfers to Level 3 in the periods presented.

Marketable Securities

The following table summarizes the Company’s marketable securities as of June 30, 2021 (in thousands):

June 30, 2021

The following table summarizes the Company’s marketable securities as of September 30, 2021 (in thousands):

September 30, 2021

Amortized Cost

8 unchanged sentences

Accrued and other current liabilities consisted of the following (in thousands):

September 30,

Accrued employee compensation costs

Accrued professional

Accrued professional costs

Accrued research and development costs

11 unchanged sentences

Upon adoption of Topic 842 on January 1, 2020, the Company recorded right-of-use assets of $ 2.2 million, operating lease liabilities of $ 2.2 million and the elimination of deferred rent of $ 0.03 million.

Adoption of the standard did no t result in the Company recording a cumulative effect adjustment.

Adoption of the standard did no t result in the Company recording a cumulative effect adjustment to accumulated deficit.

The Company determines whether an arrangement is a lease at inception.

17 unchanged sentences

The amended lease provides the Company with the option to extend the term of the lease for an additional two years .

The Company recognized a right-of-use asset and operating lease liabilities of $ 0.7 million for the extension of the lease to April 30, 2025 .

As the Company did not have access to the additional 2,357 square feet of space, a right of use asset and liability was not recognized as of June 30, 2021.

Future minimum lease payments under non-cancellable leases as of June 30, 2021 are as follows (in thousands):

The Company recognized a right-of-use asset and operating lease liabilities of $ 0.7 million for the extension of the lease to April 30, 2025 and a right-of-use asset and operating lease liabilities of $ 0.8 million for the additional 2,357 square feet of rentable space.

In September 2021, the Company entered into an agreement to extend the initial term of the 23,000 square foot lease for a period of three years commencing on December 15, 2021 and ending December 31, 2024 .

In addition, this lease provides for the lease of an additional 15,000 square feet of rentable space beginning in April 2022 and ending on December 31, 2024 .

The Company recognized a right-of-use asset and operating lease liabilities of $ 3.5 million for the 23,000 square feet.

As the Company did not have access to the additional 15,000 square feet of space, a right-of-use asst was no t recognized as of September 30, 2021.

Future minimum lease payments under non-cancellable leases as of September 30, 2021 are as follows (in thousands):

Total lease payments

5 unchanged sentences

Present value of lease liabilities

Lease balances as of June 30, 2021 are as follows (in thousands):

Lease balances as of September 30, 2021 are as follows (in thousands):

Operating right-of-use assets

2 unchanged sentences

Total operating lease liabilities

The weighted average remaining lease term and weighted average discount rate of our operating leases as of June 30, 2021 are as follows:

The weighted average remaining lease term and weighted average discount rate of our operating leases as of September 30, 2021 are as follows:

Weighted average remaining lease term in years

2 unchanged sentences

In June 2020, the Company entered into a scientific advisory board agreement with a member of the Company’s board of directors, who is also an employee of Cold Spring Harbor Laboratory (“CSHL”), to provide scientific advisory services related to the Company’s Targeted Augmentation of Nuclear Gene Output (“TANGO”) antisense oligonucleotide (“ASO”) technology and other ASO technologies, as well as current and future therapeutic targets and programs.

The Company recognized expense of $ 0.01 million in the three-month period ended June 30, 2021, and $ 0.02 million for the six-month period ended June 30, 2021, compared to $ 0.01 million for the three and six-month periods ended June 30, 2020 for such scientific advisory services.

The Company recognized expense of $ 0.01 million in the three month period ended September 30, 2021, and $ 0.03 million for the nine month period ended September 30, 2021, compared to $ 0.01 million for the three month period ended September 30, 2020 and $ 0.04 million in the nine month period ended September 30, 2020 for such scientific advisory services.

The initial term of this agreement was for 12 months.

10 unchanged sentences

The maximum aggregate potential milestone payments payable total approximately $ 0.9 million.

Additionally, certain licenses under the CSHL Agreement require the Company to reimburse CSHL for certain past and ongoing patent related expenses, however, there were no expenses related to these reimbursable patent costs during the six months ended June 30, 2021 and 2020.

In April 2016, the Company entered into an exclusive, worldwide license agreement with the University of Southampton, (the “Southampton Agreement”), whereby the Company acquired rights to foundational technologies related to the Company’s TANGO technology.

3 unchanged sentences

These royalty obligations survive until the latest of (i) the expiration of the last valid claim of a licensed patent covering a subject product or (ii) the expiration of any regulatory exclusivity for the subject product in a country.

In addition, if the Company sublicenses its rights under the Southampton Agreement, the Company is required to pay a mid-single digit percentage of the sublicense revenue to the University of Southampton.

The maximum aggregate potential milestone payments payable by the Company totaled approximately 0.4 million pounds sterling (approximately $ 0.6 million as of June 30, 2021).

As of June 30, 2021, and December 31, 2020, the Company had recorded no liabilities under the Southampton Agreement.

Additionally, certain licenses under the Southampton Agreement require the Company to reimburse the University of Southampton for certain past and ongoing patent related expenses.

For the three months ended June 30, 2021 these expenses were $ 0.05 million compared to $ 0.01 million for three months ended June 30, 2020 and for the six months ended June 30, 2021 these expenses were $ 0.06 million compared to $ 0.02 million for the six months ended June 30, 2020.

In addition, if the Company

sublicenses its rights under the Southampton Agreement, the Company is required to pay a mid-single digit percentage of the sublicense revenue to the University of Southampton.

The maximum aggregate potential milestone payments payable by the Company total ed approximately 0.4 million pounds sterling (approximately $ 0.5 million as of September 30, 2021 ).

As of September 30, 2021 , and December 31, 2 020 , the Company ha d recorded no liabilities under the Southampton Agreement.

Additionally, certain licenses under the Southampton Agreement require the Company to reimburse the University of Southampton for certain past and ongoing patent related expense s .

For the three months ended September 30, 2021 these expense s were $ 0.03 million compared to $ 0.02 million for three months ended September 30, 2020 and for the nine month s ended September 30, 2021 these expense s were $ 0.09 million compared to $ 0.04 million for the nine month s ended September 30, 2020.

Equity incentive plans

2 unchanged sentences

The number of shares reserved for issuance under the Company’s 2019 Plan will increase automatically on January 1 of each of 2020 through 2029 by the number of shares equal to 4 % of the aggregate number of outstanding shares of the Company’s common stock as of the immediately preceding December 31, or a lesser number as may be determined by the Company’s board of directors.

As of June 30, 2021, there were no shares available for future issuance under the 2014 Plan and 2,447,012 shares were available under the 2019 Plan.

During the six-months ended June 30, 2021, the Company granted options to purchase 1,188,047 shares of common stock to certain of its employees.

The options vest over four years and are exercisable at a per share price equal to the fair value of the common stock on the grant date.

As of September 30, 2021, there were no shares available for future issuance under the 2014 Plan and 2,384,112 shares were available under the 2019 Plan.

During the nine months ended September 30, 2021, the Company granted options to purchase 1,250,947 shares of common stock to certain of its employees.

The options vest up to four years and are exercisable at a per share price equal to the fair value of the common stock on the grant date.

Stock-based compensation

As of June 30, 2021, there was $ 52.9 million of unrecognized compensation cost related to unvested stock-based compensation arrangements granted under the 2014 and 2019 Plans.

The compensation is expected to be recognized over a weighted average period of 3.24 years as of June 30, 2021.

As of September 30, 2021, there was $ 48.7 million of unrecognized compensation cost related to unvested stock-based compensation arrangements granted under the 2014 and 2019 Plans.

The compensation is expected to be recognized over a weighted average period of 3.02 years as of September 30, 2021.

Stock-based compensation expense recorded as research and development and general and administrative expenses in the accompanying condensed consolidated statements of operations and comprehensive loss is as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Research and development

3 unchanged sentences

The Company initially reserved 315,000 shares of common stock for sale under the ESPP.

At June 30, 2021, the Company had 654,579 shares available for issuance under the plan.

At September 30, 2021, the Company had 642,887 shares available for issuance under the plan.

The average grant date fair value per share under the plan was $ 58.07 for 2021.

The total ESPP stock-based compensation expense for the three and six months ended June 30, 2021 was $ 0.08 million and $ 0.16 million, respectively, and for the three and six months ended June 30, 2020 was $ 0.2 million.

The total ESPP stock-based compensation expense for the three and nine months ended September 30, 2021 was $ 0.07 million and $ 0.2 million, respectively, and for the three and nine months ended September 30, 2020 was $ 0.2 million.

The number of shares reserved for issuance under the ESPP will increase automatically on January 1st of each of the first ten calendar years following the first offering date by the number of shares equal to the lesser of 1 % of the total outstanding shares of the Company’s common stock as of the immediately preceding December 31 or a lower amount determined by the Company’s board of directors.

2 unchanged sentences

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

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Weighted-average number of common shares,

4 unchanged sentences

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

September 30,

Outstanding options to purchase common stock

The Company did no t record an income tax benefit in its condensed consolidated statement of operations and comprehensive loss for the three and six months ended June 30, 2021 and 2020 as it is more likely than not that the Company will not recognize the federal and state deferred tax benefits generated by its losses.

The Company did no t record an income tax benefit in its condensed consolidated statement of operations and comprehensive loss for the three and nine months ended September 30, 2021 and 2020 as it is more likely than not that the Company will not recognize the federal and state deferred tax benefits generated by its losses.

The Company had net deferred tax assets and liabilities of $ 37.2 million at December 31, 2020.

The Company has provided a valuation allowance for the full amount of its net deferred tax assets and liabilities as of June 30, 2021 and December 31, 2020, as management has determined it is more likely than not that any future benefit from deductible temporary differences and net operating loss and tax credit carryforwards would not be realized.

The Company has provided a valuation allowance for the full amount of its net deferred tax assets and liabilities as of September 30, 2021 and December 31, 2020, as management has determined it is more likely than not that any future benefit from deductible temporary differences and net operating loss and tax credit carryforwards would not be realized.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted in response to the COVID-19 pandemic.

2 unchanged sentences

The Company has evaluated the impact of the CARES Act, and at present, the Company does no t expect that the NOL carryback provision of the CARES Act would result in a cash benefit to us.

The Company did no t record any amounts for unrecognized tax benefits as of June 30, 2021 or December 31, 2020.

The Company did no t record any amounts for unrecognized tax benefits as of September 30, 2021 or December 31, 2020.

Subsequent events

1 unchanged sentence

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