rgnx-10q_20160930.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2016

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 001-37553

 

REGENXBIO Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

 

47-1851754

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

9600 Blackwell Road, Suite 210

Rockville, MD

 

20850

(Address of principal executive offices)

 

(Zip Code)

(240) 552-8181

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

 

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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

 

Accelerated filer

 

 

 

 

 

Non-accelerated filer

 

  (Do not check if a smaller reporting company)

 

Smaller reporting company

 

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 4, 2016, there were 26,475,379 outstanding shares of the registrant’s common stock, $0.0001 par value per share.

 

 

 

 


REGENXBIO INC.

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2016

TABLE OF CONTENTS

 

 

 

PART I—FINANCIAL INFORMATION

 

 

 

 

 

 

 

Item 1.

 

Financial Statements (Unaudited)

 

2

 

 

Balance Sheets as of September 30, 2016 and December 31, 2015

 

2

 

 

Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended September 30, 2016 and 2015

 

3

 

 

Statements of Cash Flows for the Nine Months Ended September 30, 2016 and 2015

 

4

 

 

Notes to the Financial Statements

 

5

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

17

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

 

25

Item 4.

 

Controls and Procedures

 

25

 

 

 

 

 

 

 

PART II—OTHER INFORMATION

 

 

 

 

 

 

 

Item 1.

 

Legal Proceedings

 

27

Item 1A.

 

Risk Factors

 

27

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

67

Item 3.

 

Defaults Upon Senior Securities

 

67

Item 4.

 

Mine Safety Disclosures

 

67

Item 5.

 

Other Information

 

67

Item 6.

 

Exhibits

 

67

Signatures

 

68

 

 

 


INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains “forward-looking statements” that involve substantial risks and uncertainties. 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, strategy and plans, and our expectations for future operations, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “design,” “intend,” “expect,” “could,” “plan,” “potential,” “predict,” “seek,” “should,” “would” or the negative version of these words and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, strategy, short- and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties, assumptions and other important factors, including those described in the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2015, filed with the Securities and Exchange Commission on March 3, 2016. In light of these risks, uncertainties, assumptions and other factors, the forward-looking events and circumstances discussed in this Quarterly Report on Form 10-Q or our Annual Report on Form 10-K may not occur, and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements.

Forward-looking statements include, but are not limited to, statements about:

 

the timing of enrollment, commencement and completion of our clinical trials;

 

the timing and success of preclinical studies and clinical trials conducted by us and our development partners;

 

the ability to obtain and maintain regulatory approval of our product candidates, and the labeling for any approved products;

 

the scope, progress, expansion and costs of developing and commercializing our product candidates;

 

our ability to obtain and maintain intellectual property protection for our product candidates and technology;

 

our anticipated growth strategies;

 

our expectations regarding competition;

 

the anticipated trends and challenges in our business and the market in which we operate;

 

our ability to attract or retain key personnel;

 

the size and growth of the potential markets for our product candidates and the ability to serve those markets;

 

the rate and degree of market acceptance of any of our product candidates;

 

our ability to establish and maintain development partnerships;

 

our expectations regarding our expenses and revenue;

 

our expectations regarding regulatory developments in the United States and foreign countries; and

 

the use or sufficiency of our cash and cash equivalents and needs for additional financing.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. All of our development timelines could be subject to adjustment depending on recruitment rates, regulatory agency review, and other factors that could delay the initiation and completion of our clinical trials. Any forward-looking statement made by us in this Quarterly Report on Form 10-Q speaks only as of the date of this report. Except as required by law, we disclaim any duty to update any of these forward-looking statements after the date such statements are made, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

We encourage you to read the discussion and analysis of our financial condition and our financial statements contained in this Quarterly Report on Form 10-Q. We also encourage you to read Item 1A of Part II this Quarterly Report on Form 10-Q, entitled “Risk Factors,” which contains a more complete discussion of the risks and uncertainties associated with our business. In addition to the risks described above and in Item 1A of Part II of this Quarterly Report on Form 10-Q, other unknown or unpredictable factors also could affect our results. There can be no assurance that the actual results or developments anticipated by us will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, us. Therefore no assurance can be given that the outcomes stated in such forward-looking statements and estimates will be achieved.

 

 

1


PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

REGENXBIO INC.

BALANCE SHEETS

(unaudited)

(in thousands, except per share data)

 

 

 

September 30, 2016

 

 

December 31, 2015

 

Assets

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

28,108

 

 

$

54,116

 

Marketable securities

 

 

63,662

 

 

 

60,025

 

Accounts receivable

 

 

679

 

 

 

2,136

 

Prepaid expenses

 

 

2,171

 

 

 

1,020

 

Other current assets

 

 

2,000

 

 

 

851

 

Total current assets

 

 

96,620

 

 

 

118,148

 

Marketable securities

 

 

93,087

 

 

 

102,226

 

Property and equipment, net

 

 

5,804

 

 

 

538

 

Cost method investments

 

 

 

 

 

300

 

Restricted cash

 

 

225

 

 

 

 

Other assets

 

 

239

 

 

 

168

 

Total assets

 

$

195,975

 

 

$

221,380

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable

 

$

5,376

 

 

$

1,014

 

Accrued expenses and other current liabilities

 

 

9,006

 

 

 

3,198

 

Advance payments

 

 

 

 

 

127

 

Total current liabilities

 

 

14,382

 

 

 

4,339

 

Deferred rent, net of current portion

 

 

1,367

 

 

 

233

 

Total liabilities

 

 

15,749

 

 

 

4,572

 

Commitments and contingencies (Note 6)

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

Preferred stock; $0.0001 par value; 10,000 shares authorized, and no shares issued

   and outstanding at September 30, 2016 and December 31, 2015

 

 

 

 

 

 

Common stock; $0.0001 par value; 100,000 shares authorized at September 30, 2016

   and December 31, 2015; 26,475 and 26,313 shares issued and outstanding at

   September 30, 2016 and December 31, 2015, respectively

 

 

3

 

 

 

3

 

Additional paid-in capital

 

 

274,349

 

 

 

269,144

 

Accumulated other comprehensive income (loss)

 

 

853

 

 

 

(719

)

Accumulated deficit

 

 

(94,979

)

 

 

(51,620

)

Total stockholders’ equity

 

 

180,226

 

 

 

216,808

 

Total liabilities and stockholders’ equity

 

$

195,975

 

 

$

221,380

 

 

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

 

 

2


REGENXBIO INC.

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(unaudited)

(in thousands, except per share data)

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

License revenue

 

$

65

 

 

$

65

 

 

$

2,638

 

 

$

635

 

License revenue from related party

 

 

 

 

 

1,000

 

 

 

 

 

 

2,000

 

Reagent sales

 

 

47

 

 

 

61

 

 

 

213

 

 

 

200

 

Grant revenue

 

 

13

 

 

 

14

 

 

 

42

 

 

 

305

 

Total revenues

 

 

125

 

 

 

1,140

 

 

 

2,893

 

 

 

3,140

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs of revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Licensing costs (including amounts to related parties)

 

 

13

 

 

 

213

 

 

 

528

 

 

 

527

 

Costs of reagent sales (including amounts to related parties)

 

 

22

 

 

 

44

 

 

 

101

 

 

 

94

 

Research and development (including amounts to related

   parties)

 

 

12,560

 

 

 

5,664

 

 

 

29,423

 

 

 

12,471

 

General and administrative (including amounts to related

   parties)

 

 

6,200

 

 

 

2,567

 

 

 

17,848

 

 

 

7,671

 

Other operating expenses (income)

 

 

(2

)

 

 

(1

)

 

 

(136

)

 

 

15

 

Total operating expenses

 

 

18,793

 

 

 

8,487

 

 

 

47,764

 

 

 

20,778

 

Loss from operations

 

 

(18,668

)

 

 

(7,347

)

 

 

(44,871

)

 

 

(17,638

)

Other Income (Expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment income

 

 

514

 

 

 

15

 

 

 

1,512

 

 

 

23

 

Interest expense

 

 

 

 

 

 

 

 

 

 

 

(20

)

Total other income (expense)

 

 

514

 

 

 

15

 

 

 

1,512

 

 

 

3

 

Net loss

 

$

(18,154

)

 

$

(7,332

)

 

$

(43,359

)

 

$

(17,635

)

Other Comprehensive Income (Loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain (loss) on available-for-sale securities

 

 

332

 

 

 

(26

)

 

 

1,572

 

 

 

(26

)

Total other comprehensive income (loss)

 

 

332

 

 

 

(26

)

 

 

1,572

 

 

 

(26

)

Comprehensive loss

 

$

(17,822

)

 

$

(7,358

)

 

$

(41,787

)

 

$

(17,661

)

Reconciliation of net loss to net loss applicable to common

   stockholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(18,154

)

 

$

(7,332

)

 

$

(43,359

)

 

$

(17,635

)

Net accretion and dividends on convertible preferred stock

 

 

 

 

 

 

 

 

 

 

 

(1,747

)

Net gain on extinguishment of convertible preferred stock

 

 

 

 

 

 

 

 

 

 

 

759

 

Net loss applicable to common stockholders

 

$

(18,154

)

 

$

(7,332

)

 

$

(43,359

)

 

$

(18,623

)

Basic and diluted net loss per common share

 

$

(0.69

)

 

$

(1.52

)

 

$

(1.64

)

 

$

(5.48

)

Weighted-average basic and diluted common shares

 

 

26,469

 

 

 

4,809

 

 

 

26,386

 

 

 

3,397

 

 

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

 

 

3


REGENXBIO INC.

STATEMENTS OF CASH FLOWS

(unaudited)

(in thousands)

 

 

 

Nine Months Ended September 30,

 

 

 

2016

 

 

2015

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

Net loss

 

$

(43,359

)

 

$

(17,635

)

Adjustments to reconcile net loss to net cash used in operating activities

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

5,031

 

 

 

2,059

 

Net amortization of premiums and accretion of discounts on marketable debt securities

 

 

1,502

 

 

 

1

 

Depreciation and amortization

 

 

264

 

 

 

43

 

Realized gains on sales of marketable securities

 

 

(20

)

 

 

 

Unrealized foreign currency transaction gains

 

 

(2

)

 

 

(4

)

Imputed interest on related party promissory notes

 

 

 

 

 

13

 

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

Accounts receivable

 

 

1,459

 

 

 

1,277

 

Prepaid expenses

 

 

(1,151

)

 

 

(1,372

)

Other current assets

 

 

(1,149

)

 

 

(127

)

Other assets

 

 

(71

)

 

 

(128

)

Accounts payable

 

 

3,595

 

 

 

317

 

Accrued expenses and other current liabilities

 

 

4,591

 

 

 

758

 

Due to related party under services agreement

 

 

 

 

 

(34

)

Other related party payables

 

 

 

 

 

(3,412

)

Advance payments

 

 

(127

)

 

 

(26

)

Deferred rent

 

 

1,302

 

 

 

198

 

Net cash used in operating activities

 

 

(28,135

)

 

 

(18,072

)

Cash flows from investing activities

 

 

 

 

 

 

 

 

Restricted cash

 

 

(225

)

 

 

 

Purchases of marketable securities

 

 

(32,262

)

 

 

(19,065

)

Maturities of marketable securities

 

 

38,131

 

 

 

 

Sales of marketable securities

 

 

23

 

 

 

 

Purchases of property and equipment

 

 

(3,714

)

 

 

(394

)

Net cash provided by (used in) investing activities

 

 

1,953

 

 

 

(19,459

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

Proceeds from exercise of stock options

 

 

174

 

 

 

100

 

Proceeds from issuance of Series C convertible preferred stock, net of transaction costs

 

 

 

 

 

26,021

 

Proceeds from issuance of Series D convertible preferred stock, net of transaction costs

 

 

 

 

 

67,998

 

Proceeds from initial public offering of common stock, net of underwriting discounts and

   commissions

 

 

 

 

 

148,233

 

Issuance costs for initial public offering

 

 

 

 

 

(618

)

Net cash provided by financing activities

 

 

174

 

 

 

241,734

 

Net increase (decrease) in cash and cash equivalents

 

 

(26,008

)

 

 

204,203

 

Cash and cash equivalents

 

 

 

 

 

 

 

 

Beginning of period

 

 

54,116

 

 

 

1,121

 

End of period

 

$

28,108

 

 

$

205,324

 

Supplemental cash flow information

 

 

 

 

 

 

 

 

Cash paid for interest

 

$

 

 

$

7

 

Supplemental disclosures of non-cash investing and financing activities

 

 

 

 

 

 

 

 

Purchases of property and equipment in accounts payable and accrued expenses

 

$

1,816

 

 

$

34

 

Issuance costs for initial public offering in accounts payable and accrued expenses

 

$

 

 

$

2,431

 

Conversion of accrued service fees to related party into Series C convertible preferred stock

 

$

 

 

$

2,403

 

Conversion of related party promissory notes into Series C convertible preferred stock

 

$

 

 

$

1,389

 

Conversion of convertible preferred stock into common stock upon initial public offering

 

$

 

 

$

111,392

 

 

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

 

 

4


REGENXBIO INC.

NOTES TO FINANCIAL STATEMENTS

(unaudited)

(in thousands, except per share data)

 

 

1. Nature of Business

REGENXBIO Inc. (the Company) was formed on July 16, 2008 in the state of Delaware as ReGenX, LLC, and on December 22, 2009, changed its name to ReGenX Biosciences, LLC. On September 16, 2014, the Company converted from a limited liability company (LLC) to a C-corporation, and changed its name to REGENXBIO Inc. The Company is a leading biotechnology company focused on the development, commercialization and licensing of recombinant adeno-associated virus (AAV) gene therapy. The Company’s proprietary AAV gene delivery platform (NAV® Technology Platform) consists of exclusive rights to over 100 novel AAV vectors, including AAV7, AAV8, AAV9 and AAVrh10. The Company’s NAV® Technology Platform is being applied by the Company, as well as by third-party licensees, in the development of product candidates for a variety of diseases with unmet needs.

Initial Public Offering

On September 22, 2015, the Company completed its initial public offering (IPO) whereby the Company sold 7,245 shares of common stock (inclusive of 945 shares of common stock sold by the Company pursuant to the full exercise of an option to purchase additional shares granted to the underwriters in connection with the offering) at a price of $22.00 per share. The shares began trading on The Nasdaq Global Select Market on September 17, 2015. The aggregate net proceeds received by the Company from the offering were $145,184, net of underwriting discounts and commissions and offering expenses payable by the Company. Upon the closing of the IPO, all outstanding shares of convertible preferred stock converted into 16,298 shares of common stock.

Liquidity and Risks

As of September 30, 2016, the Company had generated an accumulated deficit of $94,979 since inception. As the Company continues to incur losses, transition to profitability is dependent upon the successful development, approval and commercialization of its product candidates and achieving a level of revenues adequate to support the Company’s cost structure. The Company may never achieve profitability, and unless and until it does, the Company will continue to need to raise additional capital. As of September 30, 2016, the Company had cash, cash equivalents and marketable securities of $184,857, which management believes is sufficient to fund operations for at least the next 12 months.

The Company is subject to risks common to companies in the biotechnology industry, including, but not limited to, development by the Company or its competitors of technological innovations, risks of failure of clinical trials, dependence on key personnel, protection of proprietary technology, compliance with government regulations and ability to transition from preclinical manufacturing to commercial production of products.

 

 

2. Summary of Significant Accounting Policies

Basis of Presentation and Unaudited Interim Financial Information

The accompanying financial statements are unaudited and have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (ASC) and Accounting Standards Update (ASU) of the Financial Accounting Standards Board (FASB). The interim unaudited financial statements have been prepared on the same basis as the annual audited financial statements as of and for the year ended December 31, 2015 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, filed with the Securities and Exchange Commission (SEC) on March 3, 2016. Certain information and footnote disclosures required by GAAP which are normally included in the Company’s annual financial statements have been condensed or omitted pursuant to SEC rules and regulations for interim reporting. In the opinion of management, the accompanying financial statements reflect all adjustments, which include all normal and recurring adjustments necessary for the fair statement of the Company’s financial position as of September 30, 2016, and the results of its operations and its cash flows for the interim periods ended September 30, 2016 and 2015.

The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year, any other interim periods, or any future year or period. These interim financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2015, and the notes thereto, which are included in the Company’s Annual Report on Form 10-K.

5


Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could materially differ from those estimates. Management considers many factors in selecting appropriate financial accounting policies and controls, and in developing the estimates and assumptions that are used in the preparation of these financial statements. Management must apply significant judgment in this process. In addition, other factors may affect estimates, including: expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates and whether historical trends are expected to be representative of future trends. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes and management must select an amount that falls within that range of reasonable estimates. This process may result in actual results differing materially from those estimated amounts used in the preparation of the financial statements. Estimates are used in the following areas, among others: stock-based compensation expense, accrued research and development expenses and the fair value of financial instruments.

Restricted Cash

Restricted cash includes money market mutual funds used to collateralize an irrevocable letter of credit as required by the Company’s lease agreement for its office space in New York, New York.

Fair Value of Financial Instruments

The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. FASB ASC Topic 820, Fair Value Measurements and Disclosures (ASC 820), establishes a hierarchy of inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability, and are developed based on the best information available in the circumstances. The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality. The three levels of the fair value hierarchy are described below:

 

Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

 

Level 2—Valuations based on quoted prices for similar assets or liabilities in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

 

Level 3—Valuations that require inputs that reflect the Company’s own assumptions that are both significant to the fair value measurement and unobservable.

To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The fair values of the Company’s Level 2 instruments are based on quoted market prices or broker or dealer quotations for similar assets. These investments are initially valued at the transaction price and subsequently valued utilizing third party pricing providers or other market observable data. Please refer to Note 4 for further information on the fair value measurement of the Company’s financial instruments.

Net Loss Per Share

The Company computes net loss per share in conformity with the two-class method required for participating securities. The Company considers all series of convertible preferred stock outstanding prior to the IPO to be participating securities. The holders of convertible preferred stock outstanding prior to the IPO were entitled to receive preferential dividends in the event that a dividend was to be paid to the holders of common stock, and did not have a contractual obligation to share in the losses of the Company. As such, the Company’s net losses for the three and nine months ended September 30, 2015 were not allocated to these participating securities. In connection with the IPO, all outstanding shares of convertible preferred stock were automatically converted into shares of common stock.

Basic net loss per share is calculated by dividing net loss applicable to holders of common stock by the weighted-average shares outstanding during the period, without consideration for common stock equivalents. Diluted net loss per share is calculated by adjusting weighted-average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period,

6


determined using the treasury-stock method. For purposes of the diluted net loss per share calculation, convertible preferred stock, outstanding stock options and withholdings under the employee stock purchase plan are considered to be common stock equivalents but have been excluded from the calculation of diluted net loss per share, as their effect would be anti-dilutive. Contingently convertible shares in which conversion is based on non-market-priced contingencies are excluded from the calculations of both basic and diluted net loss per share until the contingency has been fully met. Accordingly, basic and diluted net loss per share were the same for all periods presented.

Recently Announced Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606), which deferred the effective date of the guidance under ASU No. 2014-09 by one year. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, which clarifies various aspects of Topic 606, including the identification of performance obligations and the implementation of licensing guidance. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients, which clarifies various additional aspects of Topic 606, including the assessment of collectability, presentation of sales taxes and other similar taxes collected from customers, the measurement date for transactions with non-cash consideration as well as transitional issues and other technical corrections regarding the adoption of new standards under Topic 606. The standards are effective for annual and interim reporting periods beginning after December 15, 2017. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Company is evaluating the application of these ASU’s, but has not yet determined the potential effects they may have on the Company’s financial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which amends the accounting for credit losses for most financial assets and certain other instruments. The standard requires that entities holding financial assets and net investment in leases that are not accounted for at fair value through net income to be presented at the net amount expected to be collected. An allowance for credit losses will be a valuation account that will be deducted from the amortized cost basis of the financial asset to present the net carrying value at the amount expected to be collected on the financial asset. The standard is effective for annual and interim periods beginning after December 15, 2019, with early adoption permitted for annual and interim periods beginning after December 15, 2018. The Company does not believe the application of this standard will have a material impact on the Company’s financial position or results of operations.

In March 2016, the FASB issued ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, which is intended to simplify several aspects of the accounting for share-based payment awards including income tax consequences, classification of awards as either equity or liabilities and classification within the statement of cash flows. The standard is effective for annual and interim periods beginning after December 15, 2016, with early adoption permitted upon issuance. The Company does not believe the application of this standard will have a material impact on the Company’s financial position or results of operations.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) which supersedes FASB ASC Topic 840, Leases (Topic 840) and provides principles for the recognition, measurement, presentation and disclosure of leases for both lessees and lessors. The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is evaluating the application of this ASU, but has not yet determined the potential effects it may have on the Company’s financial statements.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments—Overall (Topic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, which supersedes the current guidance to classify equity securities with readily determinable fair values into different categories and requires equity securities to be measured at fair value with changes in the fair value recognized through net income (loss). The standard is effective for annual and interim periods beginning after December 15, 2017. The Company does not believe the application of this standard will have a material impact on the Company’s financial position or results of operations.

7


In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, requiring management to evaluate whether events or conditions could impact an entity’s ability to continue as a going concern and to provide disclosures if necessary. Management will be required to perform the evaluation within one year after the date that the financial statements are issued. Disclosures will be required if conditions give rise to substantial doubt and the type of disclosure will be determined based on whether management’s plans will be able to alleviate the substantial doubt. The standard is effective for the first annual period ending after December 15, 2016, and for annual periods and interim periods thereafter with early application permitted. The Company does not believe that, upon its adoption, the application of this standard will have a material impact on the Company’s financial statement disclosures.

 

 

3. Marketable Securities

The following table presents a summary of the Company’s marketable securities, which consist solely of available-for-sale securities:

 

 

 

Amortized

Cost

 

 

Unrealized

Gains

 

 

Unrealized

Losses

 

 

Fair Value

 

September 30, 2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate bonds

 

$

155,596

 

 

$

292

 

 

$

(34

)

 

$

155,854

 

Common equity securities

 

 

300

 

 

 

595

 

 

 

 

 

 

895

 

 

 

$

155,896

 

 

$

887

 

 

$

(34

)

 

$

156,749

 

 

 

 

Amortized

Cost

 

 

Unrealized

Gains

 

 

Unrealized

Losses

 

 

Fair Value

 

December 31, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate bonds

 

$

157,977

 

 

$

4

 

 

$

(759

)

 

$

157,222

 

Commercial paper

 

 

4,990

 

 

 

 

 

 

 

 

 

4,990

 

Common equity securities

 

 

3

 

 

 

36

 

 

 

 

 

 

39

 

 

 

$

162,970

 

 

$

40

 

 

$

(759

)

 

$

162,251

 

 

As of December 31, 2015, the Company’s common equity securities consisted of shares of common stock of Dimension Therapeutics, Inc. (Dimension), which became a publicly traded company in October 2015. The Company obtained these shares in connection with a license granted to Dimension in October 2013. As of September 30, 2016, the Company had sold all of its shares of Dimension common stock.

As of September 30, 2016, the Company’s common equity securities consisted of shares of common stock of Audentes Therapeutics, Inc. (Audentes), which became a publicly traded company in July 2016. The Company obtained these shares in connection with a license granted to Audentes in July 2013. The Company is restricted from trading these securities until January 2017 pursuant to a lock-up agreement entered into in connection with Audentes’ IPO. The Company has classified these shares as available-for-sale securities and recognized an unrealized gain of $595 which is included in accumulated other comprehensive income as of September 30, 2016. Prior to Audentes’ IPO, the shares were not marketable and were accounted for as a cost method investment on the Company’s balance sheets.

As of September 30, 2016 and December 31, 2015, no available-for-sale securities had remaining maturities greater than three years.

The amortized cost of available-for-sale securities is adjusted for amortization of premiums and accretion of discounts to maturity. As of September 30, 2016 and December 31, 2015, the balance in the Company’s accumulated other comprehensive income (loss) consisted solely of net unrealized gains and losses on available-for-sale securities. For the nine months ended September 30, 2016, the Company recognized net unrealized gains on available-for-sale securities of $1,572, which is included in other comprehensive income for the period. The Company recognized realized gains of $20 on the sale or maturity of available-for-sale securities during the nine months ended September 30, 2016, which were reclassified out of accumulated other comprehensive income (loss) during the period. The realized gains on available-for-sale securities related solely to the sale of Dimension common stock during the period.

The aggregate fair value of securities held by the Company in an unrealized loss position for less than 12 months as of September 30, 2016 and December 31, 2015 was $40,512 and $155,486, respectively. The Company did not hold any securities in an unrealized loss position for more than 12 months as of December 31, 2015. The aggregate fair value of securities held by the Company in an unrealized loss position for more than 12 months as of September 30, 2016 was $4,116. The aggregate unrealized loss

8


for those securities in an unrealized loss position for more than 12 months as of September 30, 2016 was $6. As of September 30, 2016, securities held by the Company which were in an unrealized loss position consisted of eleven investment grade corporate bonds. The Company has the intent and ability to hold such securities until recovery and has determined that none of its investments were other-than-temporarily impaired as of September 30, 2016 or December 31, 2015.

 

 

4. Fair Value of Financial Instruments

Financial instruments reported at fair value on a recurring basis include cash equivalents and marketable securities. Cash equivalents consist solely of money market mutual funds. Marketable securities consist of corporate debt securities, including corporate bonds and commercial paper, as well as common equity securities as disclosed in Note 3. The following tables present the fair value of cash equivalents and marketable securities in accordance with the hierarchy discussed in Note 2: 

 

 

 

Quoted

 

 

Significant

 

 

 

 

 

 

 

 

 

 

 

prices

 

 

other

 

 

Significant

 

 

 

 

 

 

 

in active

 

 

observable

 

 

unobservable

 

 

 

 

 

 

 

markets

 

 

inputs

 

 

inputs

 

 

 

 

 

 

 

(Level 1)

 

 

(Level 2)

 

 

(Level 3)

 

 

Total

 

September 30, 2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money market mutual funds (cash equivalents)

 

$

 

 

$

28,108

 

 

$

 

 

$

28,108

 

Corporate bonds (marketable securities)

 

 

 

 

 

155,854

 

 

 

 

 

 

155,854

 

Common equity securities (marketable securities)

 

 

895

 

 

 

 

 

 

 

 

 

895

 

 

 

$

895

 

 

$

183,962

 

 

$

 

 

$

184,857

 

 

 

 

Quoted

 

 

Significant

 

 

 

 

 

 

 

 

 

 

 

prices

 

 

other

 

 

Significant

 

 

 

 

 

 

 

in active

 

 

observable

 

 

unobservable

 

 

 

 

 

 

 

markets

 

 

inputs

 

 

inputs

 

 

 

 

 

 

 

(Level 1)

 

 

(Level 2)

 

 

(Level 3)

 

 

Total

 

December 31, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money market mutual funds (cash equivalents)

 

$

 

 

$

54,104

 

 

$

 

 

$

54,104

 

Corporate bonds (marketable securities)

 

 

 

 

 

157,222

 

 

 

 

 

 

157,222

 

Commercial paper (marketable securities)

 

 

 

 

 

4,990

 

 

 

 

 

 

4,990

 

Common equity securities (marketable securities)

 

 

39

 

 

 

 

 

 

 

 

 

39

 

 

 

$

39

 

 

$

216,316

 

 

$

 

 

$

216,355

 

 

Management estimates that the carrying amounts of its accounts receivable, accounts payable and accrued expenses and other current liabilities approximate fair value due to the short-term nature of those instruments.  

The Company has determined that it is not practicable to estimate the fair value of cost method investments. The Company has not identified any events or changes in circumstances that would have an adverse effect on the fair value of its cost method investments reported as of December 31, 2015.

 

 

5. Property and Equipment, Net

Property and equipment, net consists of the following:

 

 

 

September 30, 2016

 

 

December 31, 2015

 

Computer equipment and software

 

$

865

 

 

$

458

 

Lab equipment

 

 

756

 

 

 

 

Furniture and fixtures

 

 

870

 

 

 

105

 

Leasehold improvements

 

 

3,657

 

 

 

55

 

Total property and equipment

 

 

6,148

 

 

 

618

 

Accumulated depreciation and amortization

 

 

(344

)

 

 

(80

)

Property and equipment, net

 

$

5,804

 

 

$

538

 

 

 

9


6. Commitments and Contingencies

Lease Agreements

The Company recognizes rent expense on a straight-line basis over the term of its operating leases commencing on the date the Company takes possession of the leased property. Tenant improvement allowances which are considered to be lease incentives from the lessor are recorded as deferred rent and amortized as a reduction of rent expense over the term of the lease from the possession date.

In March 2015, the Company entered into a 5.5-year, non-cancelable operating lease for office space in Rockville, Maryland. The lease commenced in April 2015, and expires in September 2020. The Company has options to extend the lease for up to 6 years. Initial monthly payments required under the lease were $24 beginning in October 2015 and escalate annually in accordance with the lease.

In September 2015, and again in November 2015, the Company amended its operating lease in Rockville, Maryland to include additional office and laboratory space and extend the term of the lease for its existing space to October 2020. The lease for the additional space commenced in April 2016, and has a 5-year term expiring in March 2021. The Company has options to extend the lease for the additional space to be coterminous with the Company’s existing lease at that facility. Initial monthly payments required under the lease for the additional space were $41 and escalate annually in accordance with the lease. The Company received a $286 tenant improvement allowance from the landlord which will be deferred and amortized on a straight-line basis as a reduction of rent expense over the term of lease.

In January 2016, the Company entered into a 7.5-year, non-cancelable operating lease for additional office space in Rockville, Maryland. The lease commenced in February 2016, and expires in September 2023. Initial monthly payments required under the lease are $38 beginning seven months from the commencement date and escalate annually in accordance with the lease agreement. The Company received a $725 tenant improvement allowance from the landlord which will be deferred and amortized on a straight-line basis as a reduction of rent expense over the term of lease.

In May 2016, the Company entered into a 51-month, non-cancelable operating lease for additional office space in New York, New York. The lease commenced in July 2016, and expires in October 2020. Initial monthly payments required under the lease are $25 beginning three months from the commencement date and escalate annually in accordance with the lease agreement. Under the terms of the lease agreement, the Company has provided the landlord with an irrevocable letter of credit of $225 which the landlord may draw upon in the event of any uncured default by the Company under the terms of the lease. As of September 30, 2016, the Company has recorded restricted cash of $225 as collateral to the financial institution which issued the letter of credit.

The Company entered into a short-term operating lease for office space in Gaithersburg, Maryland which expired in October 2016.

As of September 30, 2016, future minimum lease payments under non-cancelable operating leases are as follows:

 

 

 

Operating

 

 

 

Leases

 

2016 (remainder of year)

 

$

387

 

2017

 

 

1,589

 

2018

 

 

1,637

 

2019

 

 

1,685

 

2020

 

 

1,611

 

Thereafter

 

 

1,614

 

Total minimum lease payments

 

$

8,523

 

 

Licenses Granted to the Company

Licenses granted to the Company may require the Company to make future payments relating to sublicense fees, milestone fees for milestones achieved in the future and royalties on future sales of licensed products. Additionally, the Company may be responsible for the cost of the maintenance of the intellectual property as incurred by its licensors. Up-front fees to obtain licensed technology are included in research and development expenses and patent maintenance costs are included in general and administrative expenses in the statements of operations and comprehensive loss. Sublicense fees are based on a specified percentage of license fees earned by the Company and are included in licensing costs in the statements of operations and comprehensive loss. Royalties on sales of licensed reagents for use in research and development are included in costs of reagent sales in the statements of operations and comprehensive loss. The Company has not commercialized any product candidates or paid any royalties under these agreements other than for the sales of licensed reagents.

10


The Trustees of the University of Pennsylvania. In February 2009, the Company entered into a license agreement, as amended, with The Trustees of the University of Pennsylvania (Penn) for exclusive, worldwide rights to certain patents owned by Penn underlying the Company’s NAV® Technology Platform. Under the terms of the agreement, in consideration for the license, the Company issued to Penn 24.5 percent of the then outstanding membership interest in the LLC on a fully diluted basis after issuance. The Company is obligated to pay Penn royalties on net sales and sublicense fees, if any. Additionally, the Company is obligated to reimburse Penn for certain costs incurred related to the maintenance of the licensed patents.

In April 2016, the Company entered into an agreement with Penn whereby the Company will fund clinical trial activities performed by Penn for RGX-501, the Company’s product candidate for homozygous familial hypercholesterolemia (HoFH). In connection with the agreement, the Company amended its license from Penn to include exclusive license rights to data, results and other information generated in connection with the RGX-501 clinical trial.

Expenses incurred by the Company related to its license from Penn were as follows:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Sublicense fees

 

$

7

 

 

$

107

 

 

$

264

 

 

$

264

 

Royalties on sales of reagents

 

 

2

 

 

 

2

 

 

 

11

 

 

 

8

 

Maintenance of licensed patents

 

 

42

 

 

 

29

 

 

 

85

 

 

 

118

 

 

 

$

51

 

 

$

138

 

 

$

360

 

 

$

390

 

 

As of September 30, 2016 and December 31, 2015, the Company had accrued $22 and $440, respectively, in expenses payable to Penn under the license agreement, which are included in accounts payable and accrued expenses on the Company’s balance sheets. Until September 30, 2015, the Company considered Penn to be a related party. See Note 9 for further information on related party transactions with Penn.

GlaxoSmithKline LLC. In March 2009, the Company entered into a license agreement, as amended, with GlaxoSmithKline LLC (GSK) for exclusive, worldwide rights to certain patents underlying the Company’s NAV® Technology Platform which are owned by Penn and exclusively licensed to GSK. Under the terms of the agreement, in consideration for the license, the Company issued to GSK 19.9 percent of the then outstanding membership interest in the LLC on a fully diluted basis after issuance. The Company is obligated to pay GSK royalties on net sales and sublicense fees, if any. Additionally, the Company is obligated to reimburse GSK for certain costs incurred and invoiced to the Company related to the maintenance of the licensed patents. The Company is obligated to pay GSK up to $1,500 upon the achievement of various milestones. As of September 30, 2016, no milestones have been achieved, or deemed probable of achievement, and accordingly no milestone payments were payable to GSK.

Expenses incurred by the Company related to its license from GSK were as follows:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Sublicense fees

 

$

7

 

 

$

107

 

 

$

264

 

 

$

264

 

Royalties on sales of reagents

 

 

1

 

 

 

1

 

 

 

7

 

 

 

5

 

Maintenance of licensed patents

 

 

89

 

 

 

57

 

 

 

319

 

 

 

474

 

 

 

$

97

 

 

$

165

 

 

$

590

 

 

$

743

 

 

As of September 30, 2016 and December 31, 2015, the Company had accrued $74 and $526, respectively, in expenses payable to GSK under the license agreement, which are included in accounts payable and accrued expenses on the Company’s balance sheets. Until September 30, 2015, the Company considered GSK to be a related party. See Note 9 for further information on related party transactions with GSK.

ARIAD Pharmaceuticals, Inc. In November 2010, the Company entered into a license agreement with ARIAD Pharmaceuticals, Inc. (ARIAD), for exclusive, worldwide rights to certain patents owned and exclusively licensed by ARIAD. In consideration for the license, the Company issued Class A Units of the LLC to ARIAD with a fair value of $726. Under the terms of the agreement, the Company is obligated to pay ARIAD royalties on net sales, and sublicense fees, if any. Additionally, the Company is obligated to pay ARIAD up to $2,300 and annual maintenance fees of $50 upon the achievement of various milestones. As of September 30, 2016, no milestones have been achieved, or deemed probable of achievement, and accordingly no milestone payments or maintenance fees were payable to ARIAD. Additionally, the Company has not incurred any royalties or sublicense fees payable to ARIAD since the

11


inception of the agreement. There were no amounts due to ARIAD under the agreement as of September 30, 2016 and December 31, 2015.

Regents of the University of Minnesota. In November 2014, the Company entered into a license agreement with Regents of the University of Minnesota (Minnesota), for an exclusive license under certain patent rights to commercialize products covered by the licensed patent rights in any country or territory in which a licensed patent has been issued and is unexpired, or a licensed patent application is pending. In consideration for the license, the Company paid an up-front fee of $25 and reimbursed Minnesota for patent maintenance expenses of $9. Under the terms of the agreement, the Company is obligated to pay Minnesota annual maintenance fees between $5 and $15 per year on each anniversary date of the agreement. Additionally, the Company is obligated to pay royalties on net sales and sublicense fees, if any, and up to $125 per licensed product upon the achievement of various milestones. As of September 30, 2016, no milestones have been achieved, or deemed probable of achievement, and accordingly no milestone payments were payable to Minnesota. Additionally, the Company has not incurred any royalties or sublicense fees payable to Minnesota since the inception of the agreement. As of September 30, 2016 and December 31, 2015, the Company had accrued $25 and $0, respectively, in patent maintenance expenses payable to Minnesota under the license agreement.

Guarantees and Indemnifications

In the normal course of business, the Company enters into agreements that contain a variety of representations and provide for general indemnification. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future. To date, the Company has not paid any claims or been required to defend any action related to its indemnification obligations. As of September 30, 2016 and December 31, 2015, the Company did not have any material indemnification claims that were probable or reasonably possible and consequently has not recorded any related liabilities.

 

 

7. Significant Agreements

See Note 6 for license agreements granted to the Company.

Licenses Granted by the Company

The Company has granted a number of intellectual property licenses to other biotechnology and pharmaceutical companies. The terms of the licenses vary, however licenses may be exclusive or non-exclusive and may be sublicensable by the licensee. Licenses may grant intellectual property rights for purposes of internal and preclinical research and development only, or may include the rights, or options to obtain future rights, to commercialize drug therapies for specific diseases using the Company’s NAV® Technology. License agreements generally have a term equal to the life of the underlying patents and are terminable only at the option of the licensee. License agreements may require licensees to pay non-refundable up-front fees, option fees and annual maintenance fees. Additional contingent consideration under the licenses may include sublicense fees, milestone fees and royalties on net sales of commercialized products. Sublicense fees vary by license and range from a mid-single digit percentage to a low-double digit percentage of license fees received by licensees as a result of sublicenses. Royalties on net sales of commercialized products vary by license and range from a mid-single digit percentage to a low-teen percentage of net sales by licensees.

Milestone fees are payable to the Company upon the achievement of specific clinical and regulatory developments by licensees. As of September 30, 2016, the Company’s license agreements, excluding additional licenses that could be granted upon the exercise of options by licensees, could result in aggregate milestone fees payable to the Company of up to $500 upon the submission of preclinical regulatory filings, $23,650 upon the commencement of various stages of clinical trials, $37,000 upon the submission of regulatory approval filings, $91,500 upon the approval of commercial products by regulatory agencies and $92,000 upon the achievement of specified sales targets for licensed products.

License revenue consists of the following:

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Up-front fees and option fees for commercial licenses

 

$

 

 

$

1,000

 

 

$

2,000

 

 

$

2,000

 

Maintenance fees for commercial licenses

 

 

65

 

 

 

65

 

 

 

395

 

 

 

245

 

Milestone fees

 

 

 

 

 

 

 

 

 

 

 

250

 

Research and other license revenue

 

 

 

 

 

 

 

 

243

 

 

 

140

 

 

 

$

65

 

 

$

1,065

 

 

$

2,638

 

 

$

2,635

 

 

 

12


8. Stock-based Compensation

Stock-based Compensation Expense

The Company’s stock-based compensation expense by award type is as follows:

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Stock options

 

$

1,800

 

 

$

1,349

 

 

$

5,002

 

 

$

2,059

 

Employee stock purchase plan

 

 

29

 

 

 

 

 

 

29

 

 

 

 

 

 

$

1,829

 

 

$

1,349

 

 

$

5,031

 

 

$

2,059

 

 

The Company has recorded aggregate stock-based compensation expense in the statement of operations and comprehensive loss as follows:

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,