0000950170-23-060298 | 10-Q | XBRL Viewer

Fair Value Measurements

9 Months Ended

Sep. 30, 2023

3. Fair Value Measurements

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


			Fair Value Measurements at Reporting Date Using
	September 30,		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	2023
Assets:
Cash equivalents
Money market funds	$	5,515	$	5,515		—		—
US treasury bills		15,937		15,937		—		—
Total cash equivalents	$	21,452	$	21,452	$	—	$	—
Short-term investments:
US treasury bills		58,244		58,244		—		—
Corporate Bonds and U.S. Government Agency Securities		19,456		4,066		15,390		—
Total Short-term investments	$	77,700	$	62,310	$	15,390	$	—


			Fair Value Measurements at Reporting Date Using
	December 31,		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	2022
Assets:

Cash equivalents
Money market funds	$	22,580	$	22,580	$	—	$	—
Corporate debt securities		7,089		2,098		4,991		—
Total cash equivalents	$	29,669	$	24,678	$	4,991	$	—
Short-term investments:
US treasury bills		2,966		2,966		—		—
Corporate Bonds and U.S. Government Agency Securities		62,378		4,732		57,646		—
Total Short-term investments	$	65,344	$	7,698	$	57,646	$	—

As of September 30, 2023, the Company’s cash equivalents were invested in money market funds, and U.S. treasury bills which were valued based on Level 1 inputs. As of December 31, 2022, the Company’s cash equivalents were invested in money market funds and corporate debt securities which were valued based on Level 1 inputs, and highly liquid corporate debt securities which were valued based on level 2 inputs. As of September 30, 2023 and December 31, 2022, the Company's short-term investments consisted of U.S. treasury bills, Corporate Bonds, and U.S. Government Agency Securities which were valued based on Level 1 inputs and on Level 2 inputs. In determining the fair value of its investments at each date presented above, the Company relied on quoted prices for similar securities in active markets or using other inputs that are observable or can be corroborated by observable market data for Level 2 investments. All available-for-sale securities have contractual maturities of less than one year. The Company did not have any financial assets or liabilities during any of the periods presented in the accompanying consolidated financial statements that required Level 3 inputs.

The carrying values of the Company’s accounts payable, accrued expenses and deferred revenue approximate their fair values due to the short-term nature of these liabilities and as such these are considered Level 1 in the fair value hierarchy.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Stock-Based Compensation Expense - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 1,441	$ 1,739	$ 4,405	$ 3,690
Research and Development
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	294	229	865	665
General and Administrative
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 1,147	$ 1,510	$ 3,540	$ 3,025

Stock-Based Compensation Expense

9 Months Ended

Sep. 30, 2023

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation Expense

5. Stock-Based Compensation Expense

The Company currently grants equity-based awards under its 2020 Incentive Award Plan (“2020 Plan”). The company previously granted equity-based awards under its 2005 Equity Incentive Plan (“2005 Plan”) and 2016 Equity Incentive Plan (“2016 Plan”).

A summary of the restricted stock unit activity under the Plans for the nine months ended September 30, 2023 was as follows:


	Shares			Weighted- Average Grant Date Fair Value
Restricted stock units outstanding as of December 31, 2022		28,212		$	4.78
Granted		270,716		$	2.85
Vested		(7,041	)	$	4.78
Forfeited		(48,184	)	$	2.93
Restricted stock units outstanding as of September 30, 2023		243,703		$	3.00

A summary of the stock option activity under the Plans for the nine months ended September 30, 2023 was as follows:


	Shares			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (in years)		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2022		4,311,333		$	7.07		8.2	$	378
Granted		2,016,730			2.86
Exercised		(57,897	)		1.76
Cancelled		(431,489	)		8.09
Outstanding at September 30, 2023		5,838,677		$	5.59		8.3	$	2,649

The fair value of each stock option granted to employees, directors and non-employees was estimated on the date of grant using the Black-Scholes option-pricing model in the case of the options granted to executive officers, with the following weighted-average assumptions for the three and nine months ended September 30, 2023 and 2022:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Risk-free interest rate		4.3	%		3.2	%		3.7	%		2.6	%
Expected dividend yield		—	%		—	%		—	%		—	%
Expected term (in years)		6.1			6.1			6.0			3.7
Expected volatility		80.0	%		85.2	%		82.9	%		81.4	%

The weighted-average fair value of options granted to employees, directors and non-employees during the three months ended September 30, 2023 and 2022 was $2.57 and $4.47, respectively, and $2.08 and $3.41 for the nine months ended September 30, 2023 and 2022.

Stock-based compensation expense included in the Company’s consolidated statements of operations and comprehensive loss was as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Research and development	$	294	$	229	$	865	$	665
General and administrative		1,147		1,510		3,540		3,025
Total	$	1,441	$	1,739	$	4,405	$	3,690

Unrecognized share-based compensation related to stock-based options amounted to $8.5 million at September 30, 2023 and is expected to be recognized over a weighted average period of approximately 2.33 years. Unrecognized share-based compensation related to restricted stock units amounted to $0.6 million at September 30, 2023 and is expected to be recognized over a weighted average period of approximately 3.23 years.

At September 30, 2023, there were 1,214,902 shares available for grant under the Company’s 2020 Incentive Award Plan and 170,000 shares available for grant under the Company’s 2022 Inducement Award Plan.

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

The Company’s significant accounting policies are disclosed in the audited consolidated financial statements for the year ended December 31, 2022, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 29, 2023. Since the date of those financial statements, there have been no changes to its significant accounting policies except as noted below.

Comprehensive Loss

Comprehensive loss includes net loss as well as other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders. For the three and nine months ended September 30, 2023, other comprehensive income (loss) consisted of unrealized gains and losses, net of taxes from its short-term investments.

As the Company did not have any element of other comprehensive income or loss during the three and nine months ended September 30, 2022, its comprehensive loss is equal to its net loss for the three and nine months ended September 30, 2022.

Restricted Cash

The Company had restricted cash of approximately $1.4 million as of September 30, 2023 and December 31, 2022. These balances were held as of September 30, 2023 at one of the Company’s financial institution to secure the Company’s letters of credit for its facility leases.

The Company’s statements of cash flows include restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on such statements. A reconciliation of the cash, cash equivalents, and restricted cash reported within the balance sheet that sum to the total of the same amounts shown in the statement of cash flows is as follows:


	September 30,		December 31,
	2023		2022
Cash and cash equivalents	$	24,850	$	32,550
Restricted cash		1,392		1,392
Total	$	26,242	$	33,942

Net Loss per Share

The Company has reported losses since inception and has computed basic net loss per share attributable to common stockholders by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding for the period, without consideration for potentially dilutive securities. The Company has included pre-funded warrants to purchase 7,408,188 shares of common stock at an exercise price of $0.001 in its computation of basic net loss per share based on the nominal exercise price.

The Company applies the two-class method to calculate its basic and diluted net loss per share, as the Company has issued shares that meet the definition of participating securities. The two-class method is an earnings allocation formula that treats a participating security as having rights to earnings that otherwise would have been available to common stockholders. The Company’s participating securities contractually entitle the holders of such shares to participate in dividends, but do not contractually require the holders of such shares to participate in losses of the Company. Accordingly, in periods in which the Company reports a net loss, such losses are not allocated to such participating securities. Additionally, in periods in which the Company reports a net loss, diluted net loss per share is the same as basic net loss per share, since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.

The following table sets forth the potentially dilutive securities that have been excluded from the calculation of diluted net loss per share because to include them would be anti-dilutive (in common stock equivalent shares):


	Nine Months Ended September 30,
	2023		2022
Stock options		5,838,677		4,336,264
Common stock warrants		10,030,575		—
Restricted stock units		243,703		35,418
Total		16,112,955		4,371,682

Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s consolidated financial position, results of operations or cash flows.

Effective January 1, 2023, the Company adopted Accounting Standards Update (ASU) No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13). ASU 2016-13 requires that credit losses be reported as an allowance using an expected losses model, representing the entity’s current estimate of credit losses expected to be incurred. For available-for-sale debt securities with unrealized losses, this standard now requires allowances to be recorded instead of reducing the amortized cost of the investment. The adoption of ASU 2016-13 did not have a material impact on its consolidated financial statements.

Collaboration Agreement - Summary of Transaction Price (Details) $ in Thousands	Sep. 30, 2023 USD ($)
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Combined performance obligation	$ 8,400
Development activities performance obligation	3,600
Post-Milestone
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Combined performance obligation	11,862
Development activities performance obligation	5,138
Total	$ 17,000

Condensed Consolidated Statements of Stockholders' Equity (Parenthetical) (unaudited) - USD ($) $ in Thousands	3 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Statement of Stockholders' Equity [Abstract]
Issuance cost	$ 3,332	$ 4,244

Stockholders' Equity

9 Months Ended

Sep. 30, 2023

Equity [Abstract]

Stockholders' Equity

4. Stockholders’ Equity

September 2023 Financing

On September 1, 2023, the Company entered into a Controlled Equity Offering Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co. (“Cantor”) pursuant to which the Company may offer and sell, from time to time through Cantor, shares

of the Company’s common stock for aggregate gross proceeds of up to $50.0 million. The offering and sale of up to $50.0 million of the common shares has been registered under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to the Company’s Registration Statement on Form S-3 (File No. 333-256020) (the “Registration Statement”), which was originally filed with the Securities and Exchange Commission (“SEC”) on May 11, 2021, and declared effective by the SEC on May 20, 2021, the base prospectus contained within the Registration Statement, and a prospectus supplement relating to the shares that was filed with the SEC on September 1, 2023 (the “Prospectus Supplement”).

Pursuant to the Sales Agreement, Cantor may sell the shares in sales deemed to be “at the market offerings” as defined in Rule 415(a)(4) promulgated under the Securities Act. The Company has no obligation to sell any of the shares under the Sales Agreement and may at any time suspend or terminate the offering of the shares pursuant to the Sales Agreement upon notice to Cantor and subject to other conditions. Cantor will act as sales agent and will use commercially reasonable efforts to sell on the Company’s behalf all of the shares requested to be sold by the Company, on mutually agreed terms between Cantor and the Company.

The Sales Agreement contains customary representations, warranties and agreements by the Company, and indemnification obligations of the Company and Cantor and other obligations of the parties. Under the terms of the Sales Agreement, the Company has agreed to pay Cantor a commission equal to 3.0% of the aggregate gross proceeds from any shares sold through it pursuant to the Sales Agreement. In addition, the Company has agreed to reimburse certain expenses incurred by Cantor in connection with the Sales Agreement.

The Company has not issued any shares of common stock under this arrangement as of September 30, 2023. Subsequent to September 30, 2023, on October 2, 2023, the Company sold an aggregate of 3,017,568 shares of common stock under the Sales Agreement, at a weighted average price of $3.71 per share, which generated net proceeds of $10.9 million. Proceeds from the Sales Agreement were not included in cash and cash equivalents or short-term investments as of September 30, 2023.

May 2023 Financing

On May 25, 2023, the Company entered into the Purchase Agreement, with the purchasers, pursuant to which the Company agreed to sell securities to the Investors in a private placement (the “Private Placement”). The Purchase Agreement provided for the sale and issuance by the Company of: (i) an aggregate of 17,652,962 Shares of the Company’s common stock and pre-funded warrants to purchase up to 2,408,188 shares of Common Stock, with an exercise price of $0.001 per share, and (ii) accompanying warrants to purchase up to 10,030,575 shares of Common Stock, with an exercise price of $2.673 per share, for aggregate gross proceeds of approximately $50.0 million, before deducting private placement expenses, or $46.7 million of net proceeds. Each Share (or Pre-Funded Warrant to purchase one share) was issued with an accompanying Purchase Warrant to purchase one-half of one share, and the combined effective purchase price per Share (or Pre-Funded Warrant to purchase one share) and accompanying Purchase Warrant to purchase one-half of one share was $2.4925 (less the exercise price of the Pre-Funded Warrant, if applicable). Each Pre-Funded Warrant was exercisable immediately and will expire on May 31, 2028. Each Purchase Warrant will be exercisable at any time on or after November 30, 2023 and will expire on November 30, 2028.

The closing of the Private Placement occurred on May 31, 2023. The Company filed a shelf registration statement on Form S-3 with the SEC on June 28, 2023 and it was declared effective on July 7, 2023.

The warrants were classified as a component of stockholders’ equity within additional paid-in capital and were recorded at the issuance date using a relative fair value allocation method. The warrants were equity classified because they are freestanding financial instruments that are legally detachable and separately exercisable from the equity instruments, are immediately exercisable, do not embody an obligation for the Company to repurchase its shares, permit the holders to receive a fixed number of shares of common stock upon exercise, are indexed to the Company’s common stock and meet the equity classification criteria. In addition, such warrants do not provide any guarantee of value or return. The Company allocated the net proceeds from the sale based on the relative fair value to the common stock and warrants, of which $11.5 million was allocated to the warrants and recorded as a component of additional paid-in capital.

There were no warrants exercised or expired during the nine months ended September 30, 2023. The following table represents a summary of the warrants outstanding and exercisable as of September 30, 2023, all of which are equity-classified:


				Number of shares Underlying Warrants
Issue Date	Exercise Price		Expiration Date	Outstanding		Exercisable
April 13, 2022	$	0.001	April 12, 2027		5,000,000		5,000,000
May 31, 2023	$	0.001	May 31, 2028		2,408,188		2,408,188
May 31, 2023	$	2.673	November 30, 2028		10,030,575		—
					17,438,763		7,408,188

April 2022 Financing

On April 13, 2022, the Company announced the closing of its private placement of common stock (or, in lieu thereof, pre-funded warrants to purchase common stock), resulting in gross proceeds of approximately $100.5 million (“the April 2022 Financing”). The Company received approximately $96.3 million in net proceeds after deducting estimated offering costs of $4.2 million. In the private placement, investors had the option to purchase either a) shares of the Company's common stock at a price of $4.22 per share, or (b) in lieu thereof, pre-funded warrants to purchase shares of the Company's common stock, with an exercise price of $0.001 per share, at a purchase price of $4.219 per share (for aggregate consideration equating to $4.22 per share). Accordingly, pursuant to the securities purchase agreement, (i) certain investors purchased an aggregate of 18,815,159 shares of common stock at the purchase price described in the foregoing sentence and (ii) certain investors purchased pre-funded warrants to purchase an aggregate of 5,000,000 shares of common stock, with the exercise price and at the purchase, in each case, described in the foregoing sentence. Each pre-funded warrant is exercisable immediately.

The pre-funded warrants were classified as a component of stockholders’ equity within additional paid-in capital and were recorded at the issuance date using a relative fair value allocation method. The pre-funded warrants are equity classified because they are freestanding financial instruments that are legally detachable and separately exercisable from the equity instruments, are immediately exercisable, do not embody an obligation for the Company to repurchase its shares, permit the holders to receive a fixed number of shares of common stock upon exercise, are indexed to the Company’s common stock and meet the equity classification criteria. In addition, such pre-funded warrants do not provide any guarantee of value or return. The Company valued the pre-funded warrants at issuance, concluding that their sales price approximated their fair value, and allocated net proceeds from the sale proportionately to the common stock and pre-funded warrants, of which $19.7 million was allocated to the pre-funded warrants and recorded as a component of additional paid-in capital.

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 505
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481004/946-505-50-6

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 815
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480237/815-40-50-6

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480008/505-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 505
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//505/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 16
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-16

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

+ Details

Collaboration Agreement

9 Months Ended

Sep. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Collaboration Agreement

6. Collaboration Agreement

Under the LianBio License Agreement, in order to evaluate the transaction price for purposes of ASC 606, the Company determined that the upfront payment of $12.0 million and the reimbursable cost of the clinical supply of LYR-210 constitute the entirety of the consideration to be included in the transaction price as of the outset of the arrangement, which was allocated to the two performance obligations as follows: $8.4 million to the Combined Performance Obligation and $3.6 million to the Development Activities Performance Obligation. In February 2022, the Company received $5.0 million upon achievement of the first of the development milestones related to dosing its first patient and the transaction price was adjusted by $5.0 million which was allocated to the two performance obligations as follows: $3.5 million to the Combined Performance Obligation and $1.5 million to the

Development Activities Performance Obligation. The remaining potential milestone payments that the Company is eligible to receive were excluded from the transaction price as of September 30, 2023, as all milestone amounts were fully constrained based on the probability of achievement.

The Company and LianBio amended the LianBio License Agreement on September 26, 2022, to allow, among other things, LianBio to conduct its own Phase 3 clinical trial and adjust certain future milestones. The amendment also requires both parties to negotiate a supply agreement prior to December 31, 2022. There was a side letter executed on December 27, 2022 which extended the negotiations of a supply agreement. The amendment did not result in any change in the Company’s determination of its performance obligations under the arrangement and all future milestones remain constrained from the transaction price. The Company has determined that the contract modification did not have a material impact on the allocation of the transaction price to the two performance obligations.

The Company will recognize the revenue associated with the Combined Performance Obligation as the clinical supply of LYR-210 is delivered. The Company recognizes revenue associated with the Development Activities Performance Obligation as the development activities are performed using an input method, according to the costs incurred as to the development activities related to the global Phase 3 clinical trial and the costs expected to be incurred in the future to satisfy the performance obligation. The transfer of control occurs over this time period and, in management’s judgment, is the best measure of progress towards satisfying the performance obligation. The amounts received that have not yet been recognized as revenue are deferred as a contract liability on the Company’s consolidated balance sheet and will be recognized as the clinical supply of LYR-210 is delivered and over the remaining time it takes to conduct the global Phase 3 clinical trial, respectively.

There were no changes in the transaction price from December 31, 2022 to September 30, 2023. The following table reflects the transaction price (in thousands):


	As of September 30, 2023
	Post-Milestone
Combined Performance Obligation	$	11,862
Development Activities Performance Obligation		5,138
Total	$	17,000

The following table reflects the revenue recognized related to each of the performance obligations and the remaining deferred revenue (in thousands):


	As of September 30, 2023
	Combined Performance Obligation		Development Activities Performance Obligation			Total
Deferred revenue at December 31, 2022	$	11,748	$	3,604		$	15,352
Milestone		—		—			—
Revenue recognized		—		(1,412	)		(1,412	)
Deferred revenue at September 30, 2023	$	11,748	$	2,192		$	13,940

Development and regulatory milestone fees, which are a type of variable consideration, are recognized as revenue to the extent that it is probable that a significant reversal will not occur. Note that the allocated deferred revenue associated with the clinical supply agreement has been recorded as long term deferred revenue given the potential uncertainty of delivery within the next twelve months.

Entities affiliated with Perceptive Advisors, LLC are shareholders of both the Company and LianBio. Additionally, two of the Company’s directors are Managing Directors at Perceptive Advisors, LLC and one of these directors is also the Executive Chairman of LianBio’s board of directors.

Condensed Consolidated Balance Sheets (Parenthetical) (unaudited) - $ / shares	Sep. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock par value	$ 0.001	$ 0.001
Common stock shares authorized	200,000,000	200,000,000
Common stock shares issued	49,545,559	31,827,659
Common stock shares outstanding	49,545,559	31,827,659

Fair Value Measurements - Additional Information (Details) - USD ($)	Sep. 30, 2023	Dec. 31, 2022	Dec. 31, 2021
Fair Value Disclosures [Abstract]
Financial assets, fair value	$ 0	$ 0
Financial liabilities, fair value	$ 0		$ 0

Stock-Based Compensation Expense - Summary of Restricted Stock Unit Activity (Details)	9 Months Ended
	Sep. 30, 2023 $ / shares shares
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Restricted stock units outstanding, Beginning Balance \| shares	28,212
Restricted stock units outstanding shares, Granted \| shares	270,716
Restricted stock units outstanding shares, Vested \| shares	(7,041)
Restricted stock units outstanding shares, Forfeited \| shares	(48,184)
Restricted stock units outstanding, Ending Balance \| shares	243,703
Weighted Average Grant Date Fair Value, Beginning Balance \| $ / shares	$ 4.78
Weighted Average Grant Date Fair Value, Granted \| $ / shares	2.85
Weighted Average Grant Date Fair Value, Vested \| $ / shares	4.78
Weighted Average Grant Date Fair Value, Forfeited \| $ / shares	2.93
Weighted Average Grant Date Fair Value, Beginning Balance \| $ / shares	$ 3

Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Cash flows from operating activities:
Net loss	$ (47,524)	$ (41,043)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation	4,405	3,690
Depreciation expense	193	845
Impairment of long-lived assets	1,592
Net amortization of premium on short-term investments	(2,408)
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	565	(172)
Operating lease right-of-use assets	1,080	747
Other assets	(3,240)	(787)
Accounts payable	3,985	(167)
Accrued expenses and other current liabilities	(625)	2,814
Operating lease liabilities	(857)	(796)
Deferred revenue	(1,412)	3,648
Net cash used in operating activities	(44,246)	(31,221)
Cash flows from investing activities:
Purchases of property and equipment	(260)	(136)
Purchases of short-term investments	(72,765)
Maturity of short-term investments	62,800
Net cash used in investing activities	(10,225)	(136)
Cash flows from financing activities:
Proceeds from sale of common stock and pre-funded warrants	50,000	100,495
Payment of deferred offering costs	(3,332)	(4,246)
Proceeds from exercise of stock options	103	8
Net cash provided by financing activities	46,771	96,257
Net (decrease) increase in cash, cash equivalents and restricted cash	(7,700)	64,900
Cash, cash equivalents and restricted cash, beginning of period	33,942	46,076
Cash, cash equivalents and restricted cash, end of period	26,242	110,976
Supplemental disclosure of non-cash financing and investing activities:
Property and equipment purchases included in accounts payable	8
Issuance costs in accounts payable, accrued expenses, and other current liabilities	150
Other assets included in accounts payable and other current liabilities	2,740	$ 249
Deferred offering costs included in accounts payable and accrued expense	$ 161

Commitments and Contingencies

9 Months Ended

Sep. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

9. Commitments and Contingencies

On May 10, 2023, the Company filed a complaint in the Superior Court of the State of Delaware against a former contract manufacturer alleging breach of contract. The Company alleged in its complaint that the former contract manufacturer breached the Master Clinical Supply Agreement (“MCSA”). The Company’s complaint sought monetary damages and the return of equipment and materials that the Company owned. On July 20, 2023, the same contract manufacturer filed an answer and amended counterclaims to the Company’s May 10, 2023 complaint (the “Litigation”). Due to the legal proceeding and termination of agreement with this manufacturer, the Company recognized $1.6 million loss on impairment of long-lived assets in the nine months ended September 30, 2023.

On November 2, 2023, the Company entered into a settlement and release agreement, related to the Litigation, pursuant to which each of the Company and the contract manufacturer provided broad mutual releases of all claims relating to or arising out of the MCSA, including without limitation, all claims brought in the Litigation or that could have been brought in the Litigation. The Company and the former contract manufacturer agreed to jointly file a Stipulation of Dismissal with prejudice relating to the Litigation. The terms of the settlement and release agreement resulted in a reduction of amounts previously recorded as due to the contract manufacturer of $0.6 million. The Company has concluded this settlement and release agreement represents a settlement of a loss contingency and therefore, has treated the resolution of this loss contingency as a recognized subsequent event by reducing

amounts previously accrued for by $0.6 million in the accompanying consolidated financial statements within accrued expenses and other current liabilities as of September 30, 2023 and for the three and nine months ended September 30, 2023, respectively.

Stockholders' Equity - Additional Information (Details) - USD ($)					9 Months Ended
	Oct. 02, 2023	Sep. 01, 2023	May 25, 2023	Apr. 13, 2022	Sep. 30, 2023
Class of Stock [Line Items]
Number of warrants exercised					0
Number of warrants expired					0
Cantor Fitzgerald & Co.
Class of Stock [Line Items]
Percentage of aggregate commission		3.00%
Sales Agreement \| Subsequent Events
Class of Stock [Line Items]
Net proceeds	$ 10,900,000
Private Placement
Class of Stock [Line Items]
Gross proceeds from private placement				$ 100,500,000
Net proceeds from private placement				96,300,000
Estimated offering costs				$ 4,200,000
Weighted average price				$ 4.22
Warrants purchase price				$ 4.219
Private Placement \| Purchase Agreement
Class of Stock [Line Items]
Aggregate gross proceeds from issuance of warrants			$ 50,000,000
Net proceeds after deducting issuance costs			$ 46,700,000
Conversion of stock, description					Each Share (or Pre-Funded Warrant to purchase one share) was issued with an accompanying Purchase Warrant to purchase one-half of one share, and the combined effective purchase price per share (or Pre-Funded Warrant to purchase one share) and accompanying Purchase Warrant to purchase one-half of one share was $2.4925 (less the exercise price of the Pre-Funded Warrant, if applicable).
Warrants purchase price			$ 2.4925
Pre Funded Warrants
Class of Stock [Line Items]
Issuance of common stock					7,408,188
Warrants exercise price, per share					$ 0.001
Aggregate gross proceeds from issuance of warrants					$ 19,700,000
Pre Funded Warrants \| Private Placement
Class of Stock [Line Items]
Issuance of common stock				5,000,000
Warrants exercise price, per share				$ 0.001
Pre Funded Warrants \| Private Placement \| Purchase Agreement
Class of Stock [Line Items]
Warrants to purchase common shares			2,408,188
Warrants exercise price, per share			$ 0.001
Class of warrant or right, expiration description					Each Pre-Funded Warrant was exercisable immediately and will expire on May 31, 2028.
Common Stock
Class of Stock [Line Items]
Sale of stock, number of shares issued (in shares)					0
Common Stock \| Subsequent Events
Class of Stock [Line Items]
Issuance of common stock	3,017,568
Common Stock \| Purchase Agreement
Class of Stock [Line Items]
Adjustments to additional paid in capital, sale of common stock and warrants					$ 11,500,000
Common Stock \| Sales Agreement \| Subsequent Events
Class of Stock [Line Items]
Issuance of common stock	3,017,568
Weighted average price	$ 3.71
Common Stock \| Private Placement
Class of Stock [Line Items]
Issuance of common stock				18,815,159
Common Stock \| Private Placement \| Purchase Agreement
Class of Stock [Line Items]
Issuance of common stock			17,652,962
Common Stock \| Maximum \| Controlled Equity Offering Sales Agreement \| Cantor Fitzgerald & Co.
Class of Stock [Line Items]
Gross proceeds under agreement		$ 50,000,000
Proceeds to be occured from future issuance of common stock		$ 50,000,000
Purchase Warrants \| Private Placement \| Purchase Agreement
Class of Stock [Line Items]
Warrants to purchase common shares			10,030,575
Warrants exercise price, per share			$ 2.673
Class of warrant or right, expiration description					Each Purchase Warrant will be exercisable at any time on or after November 30, 2023 and will expire on November 30, 2028.

Stock-Based Compensation Expense - Summary of Stock Option Activity Under Plans (Details) $ / shares in Units, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2023 USD ($) $ / shares shares	Dec. 31, 2022 USD ($) $ / shares shares
Share-Based Payment Arrangement [Abstract]
Shares, Outstanding December 31, 2022 \| shares	4,311,333
Shares, Granted \| shares	2,016,730
Shares, Exercised \| shares	(57,897)
Shares, Cancelled \| shares	(431,489)
Shares, Outstanding at September 30, 2023 \| shares	5,838,677	4,311,333
Weighted Average Exercise Price, Outstanding December 31, 2022 \| $ / shares	$ 7.07
Weighted Average Exercise Price, Granted \| $ / shares	2.86
Weighted Average Exercise Price, Exercised \| $ / shares	1.76
Weighted Average Exercise Price, Cancelled \| $ / shares	8.09
Weighted Average Exercise Price, Outstanding at September 30, 2023 \| $ / shares	$ 5.59	$ 7.07
Outstanding, Weighted Average Remaining Contractual Life (in years)	8 years 3 months 18 days	8 years 2 months 12 days
Aggregate Intrinsic Value, Outstanding \| $	$ 2,649	$ 378

Document And Entity Information - shares	9 Months Ended
Document And Entity Information - shares	Sep. 30, 2023	Nov. 01, 2023
Cover [Abstract]
Entity Registrant Name	Lyra Therapeutics, Inc.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		52,563,127
Amendment Flag	false
Entity Central Index Key	0001327273
Entity Filer Category	Non-accelerated Filer
Document Period End Date	Sep. 30, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Shell Company	false
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity File Number	001-39273
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	84-1700838
Entity Address, Address Line One	480 Arsenal Way
Entity Address, City or Town	Watertown
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02472
City Area Code	617
Local Phone Number	393-4600
Document Quarterly Report	true
Document Transition Report	false
Title of 12(b) Security	Common Stock, $0.001 par value per share
Trading Symbol	LYRA
Security Exchange Name	NASDAQ

Collaboration Agreement (Tables)

9 Months Ended

Sep. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of Transaction Price

The following table reflects the transaction price (in thousands):


	As of September 30, 2023
	Post-Milestone
Combined Performance Obligation	$	11,862
Development Activities Performance Obligation		5,138
Total	$	17,000

Schedule of Revenue Recognized Related to Each of the Performance Obligations and the Remaining Deferred Revenue

The following table reflects the revenue recognized related to each of the performance obligations and the remaining deferred revenue (in thousands):


	As of September 30, 2023
	Combined Performance Obligation		Development Activities Performance Obligation			Total
Deferred revenue at December 31, 2022	$	11,748	$	3,604		$	15,352
Milestone		—		—			—
Revenue recognized		—		(1,412	)		(1,412	)
Deferred revenue at September 30, 2023	$	11,748	$	2,192		$	13,940

Collaboration Agreement - Additional Information (Details) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
	Feb. 28, 2022	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Deferred revenue, description				Under the LianBio License Agreement, in order to evaluate the transaction price for purposes of ASC 606, the Company determined that the upfront payment of $12.0 million and the reimbursable cost of the clinical supply of LYR-210 constitute the entirety of the consideration to be included in the transaction price as of the outset of the arrangement, which was allocated to the two performance obligations as follows: $8.4 million to the Combined Performance Obligation and $3.6 million to the Development Activities Performance Obligation. In February 2022, the Company received $5.0 million upon achievement of the first of the development milestones related to dosing its first patient and the transaction price was adjusted by $5.0 million which was allocated to the two performance obligations as follows: $3.5 million to the Combined Performance Obligation and $1.5 million to the Development Activities Performance Obligation. The remaining potential milestone payments that the Company is eligible to receive were excluded from the transaction price as of September 30, 2023, as all milestone amounts were fully constrained based on the probability of achievement.
Combined performance obligation		$ 8,400,000		$ 8,400,000
Development activities performance obligation		3,600,000		3,600,000
Collaboration revenue		544,000	$ 359,000	1,412,000	$ 1,352,000
Change in transaction price				0
Clinical Supply Agreement
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Upfront payment recognition in future periods to settlement of obligation		12,000,000		12,000,000
Milestone Achievements
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Upfront payment recognition in future periods to settlement of obligation	$ 5,000,000
Combined performance obligation	3,500,000
Development activities performance obligation		1,500,000		1,500,000
Collaboration revenue	$ 5,000,000
Post-Milestone
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Upfront payment recognition in future periods to settlement of obligation		17,000,000		17,000,000
Combined performance obligation		11,862,000		11,862,000
Development activities performance obligation		$ 5,138,000		$ 5,138,000

Subsequent Events

9 Months Ended

Sep. 30, 2023

Subsequent Events [Abstract]

Subsequent Events

10. Subsequent Events

Subsequent to September 30, 2023, on October 2, 2023, the Company sold an aggregate of 3,017,568 shares of common stock under the Sales Agreement, at a weighted average price of $3.71 per share, which generated net proceeds of $10.9 million. Proceeds from the Sales Agreement were not included in cash and cash equivalents or short-term investments as of September 30, 2023.

Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Summary of Reconciliation of Cash, Cash Equivalents and Restricted Cash Reported within Balance Sheet

A reconciliation of the cash, cash equivalents, and restricted cash reported within the balance sheet that sum to the total of the same amounts shown in the statement of cash flows is as follows:


	September 30,		December 31,
	2023		2022
Cash and cash equivalents	$	24,850	$	32,550
Restricted cash		1,392		1,392
Total	$	26,242	$	33,942

Summary of Potentially Dilutive Securities Excluded from Calculation of Diluted Net Loss per Share


	Nine Months Ended September 30,
	2023		2022
Stock options		5,838,677		4,336,264
Common stock warrants		10,030,575		—
Restricted stock units		243,703		35,418
Total		16,112,955		4,371,682

Stockholders' Equity - Summary of Warrants Outstanding and Exercisable (Details)	9 Months Ended
	Sep. 30, 2023 $ / shares shares
Class of Warrant or Right [Line Items]
Number of shares Underlying Warrants Outstanding	17,438,763
Number of shares Underlying Warrants Exercisable	7,408,188
Warrant One
Class of Warrant or Right [Line Items]
Issue Date	Apr. 13, 2022
Exercise Price \| $ / shares	$ 0.001
Expiration Date	Apr. 12, 2027
Number of shares Underlying Warrants Outstanding	5,000,000
Number of shares Underlying Warrants Exercisable	5,000,000
Warrant Two
Class of Warrant or Right [Line Items]
Issue Date	May 31, 2023
Exercise Price \| $ / shares	$ 0.001
Expiration Date	May 31, 2028
Number of shares Underlying Warrants Outstanding	2,408,188
Number of shares Underlying Warrants Exercisable	2,408,188
Warrant Three
Class of Warrant or Right [Line Items]
Issue Date	May 31, 2023
Exercise Price \| $ / shares	$ 2.673
Expiration Date	Nov. 30, 2028
Number of shares Underlying Warrants Outstanding	10,030,575

Organization and Basis of Presentation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands				9 Months Ended
	Oct. 02, 2023	May 25, 2023	Apr. 13, 2022	Sep. 30, 2023	Dec. 31, 2022
Organization And Basis Of Presentation [Line Items]
Fund raised for operations				$ 397,000
Accumulated deficit				(296,199)	$ (248,675)
Cash and cash equivalents				24,850	32,550
Short-term investments				$ 77,700	$ 65,344
Common stock par value				$ 0.001	$ 0.001
Sales Agreement \| Subsequent Events
Organization And Basis Of Presentation [Line Items]
Net proceeds	$ 10,900
Pre Funded Warrants
Organization And Basis Of Presentation [Line Items]
Issuance of common stock				7,408,188
Warrants exercise price, per share				$ 0.001
Aggregate gross proceeds from issuance of warrants				$ 19,700
Private Placement
Organization And Basis Of Presentation [Line Items]
Weighted average price			$ 4.22
Warrants purchase price			$ 4.219
Private Placement \| Purchase Agreement
Organization And Basis Of Presentation [Line Items]
Aggregate gross proceeds from issuance of warrants		$ 50,000
Warrants purchase price		$ 2.4925
Conversion of stock, description				Each Share (or Pre-Funded Warrant to purchase one share) was issued with an accompanying Purchase Warrant to purchase one-half of one share, and the combined effective purchase price per share (or Pre-Funded Warrant to purchase one share) and accompanying Purchase Warrant to purchase one-half of one share was $2.4925 (less the exercise price of the Pre-Funded Warrant, if applicable).
Private Placement \| Pre Funded Warrants
Organization And Basis Of Presentation [Line Items]
Issuance of common stock			5,000,000
Warrants exercise price, per share			$ 0.001
Private Placement \| Pre Funded Warrants \| Purchase Agreement
Organization And Basis Of Presentation [Line Items]
Warrants exercise price, per share		$ 0.001
Warrants to purchase common shares		2,408,188
Class of warrant or right, expiration description				Each Pre-Funded Warrant was exercisable immediately and will expire on May 31, 2028.
Common Stock \| Subsequent Events
Organization And Basis Of Presentation [Line Items]
Issuance of common stock	3,017,568
Common Stock \| Sales Agreement \| Subsequent Events
Organization And Basis Of Presentation [Line Items]
Issuance of common stock	3,017,568
Weighted average price	$ 3.71
Common Stock \| Private Placement
Organization And Basis Of Presentation [Line Items]
Issuance of common stock			18,815,159
Common Stock \| Private Placement \| Purchase Agreement
Organization And Basis Of Presentation [Line Items]
Issuance of common stock		17,652,962
Common stock par value		$ 0.001
Purchase Warrants \| Private Placement \| Purchase Agreement
Organization And Basis Of Presentation [Line Items]
Warrants exercise price, per share		$ 2.673
Warrants to purchase common shares		10,030,575
Class of warrant or right, expiration description				Each Purchase Warrant will be exercisable at any time on or after November 30, 2023 and will expire on November 30, 2028.

Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Accounting Policies [Line Items]
Restricted cash	$ 1,392	$ 1,392
Pre Funded Warrants
Accounting Policies [Line Items]
Issuance of pre-funded warrants to purchase shares of common stock	7,408,188
Common stock par value	$ 0.001

Leases

9 Months Ended

Sep. 30, 2023

Leases [Abstract]

Leases

8. Leases

Watertown Lease

In August 2007, the Company entered into an operating lease, as amended, for office and laboratory space in Watertown, Massachusetts. The lease includes certain rent escalations. In July 2023, the Company amended the lease to extend the expiration of the lease term from April 2024 to April 2027. Under the terms of the amended lease, the Company no longer has the right to terminate the lease after January 1, 2024. The Company has accounted for the amendment as a lease modification and changes to the right of use asset and liability was reflected within the consolidated balance sheet as of September 30, 2023. The impact to the right of use asset as of the lease amendment date was $4.9 million.

The Company maintains a letter of credit of approximately $0.3 million securing its obligations under the operating lease, which is included as restricted cash in the consolidated balance sheets. Rent expense is recognized on a straight-line basis over the terms of occupancy.

Waltham Lease

In May 2022, the Company executed a new lease for laboratory and office space. This lease will be recorded on the Company's balance sheet when the Company obtains possession of the underlying asset, which is expected to occur in the fourth quarter of 2023, following completion of construction to prepare the premises for the Company’s intended use. Annual base rent will start at $2.2 million increasing 3% per year through the original non-cancelable term of the lease, which is ten years and two months following the lease commencement date. The Company has the option to extend the lease for one additional 5-year term and is responsible for real estate taxes, maintenance, and other operating expenses applicable to the leased premises.

As of September 30, 2023, the lease was not recorded on the condensed consolidated balance sheet as the facility is under construction. As payments are made by the Company relating to landlord-owned leasehold improvements and rent, they will be recorded to prepaid rent as a component of other non-current assets. On the lease commencement date, the Company plans to reclassify the prepayment to the right-of-use asset, thereby increasing its initial value, but the prepayment will not be included in the measurement of the lease liability. As of September 30, 2023, approximately $6.3 million of prepaid rent was recorded in other assets. The lease will be recorded as a component of the Company’s right-of-use asset and operating lease liabilities when the lease commencement date occurs.

The Company provided a letter of credit in the amount of $1.1 million as a security for the lease, which expires on April 1, 2024, at which point the letter will automatically renew each calendar year up to but not beyond July 31, 2033. The cash securing the letter of credit is classified as restricted cash on the consolidated balance sheet.

Embedded Leases

In April 2021, the Company entered into a clinical supply agreement with a CMO for clinical production of the Company’s product candidates at an existing facility and a facility under construction. The Company concluded that this clinical supply agreement contains embedded operating leases as the clean rooms in the existing facility and the new facility are designated for the Company’s exclusive use during the term of the agreement and the clinical supply agreement contains fixed commitments and variable costs related to production and material costs in excess of the fixed commitment specified in the agreement. The Company determined that it did not control the new facility during construction and, thus, the lease did not fall in the scope of “build-to-suit” accounting. The term of the clinical supply agreement is five years and will automatically renew for additional successive terms of one year unless either party gives notice of nonrenewal.

The lease period for the existing facility is less than 12 months and the Company has elected to apply the practical expedient in ASC Topic 842, Leases (“ASC 842”), to not recognize a lease liability or right-of-use asset but instead, recognize lease payments as an expense on a straight-line basis over the lease term and variable lease payments that do not depend on an index or rate, as an expense in the period in which the variable lease costs are incurred based on performance or usage in accordance with the clinical supply agreement. In October 2022, the Company terminated the agreement with the contract manufacturing organization.

The components of lease cost recorded in the Company’s condensed consolidated financial statements were as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Lease Cost:
Operating lease cost	$	483	$	264	$	1,371	$	792
Variable lease cost		399		870		893		3,744
Total lease cost	$	882	$	1,134	$	2,264	$	4,536

Variable lease payments include the Company’s allocated share of costs incurred and expenditures made by the landlord in the operation and management of the building and variable lease costs associated with the Company’s CMO embedded lease arrangement. During the three and nine months ended September 30, 2023, the Company recorded no costs as research and development expense related to the CMO embedded lease compared to $0.7 million and $3.2 million in the comparable period of the prior year, respectively.

The weighted-average remaining lease term and discount rate related to the Company’s operating leases were as follows:


	As of September 30, 2023
Weighted-average remaining lease term (in years)		3.6
Weighted-average discount rate		9.25	%

Maturity of the Company’s operating lease liabilities in accordance with ASC 842 as of September 30, 2023 were as follows (in thousands):

Organization and Basis of Presentation

9 Months Ended

Sep. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Basis of Presentation

1. Organization and Basis of Presentation

Lyra Therapeutics, Inc. (the “Company”) is a clinical-stage biotechnology company focused on the development and commercialization of therapies for the localized treatment of patients with chronic rhinosinusitis, or CRS. The Company’s proprietary technology is designed to consistently deliver medicines directly to the affected tissue for sustained periods with a single administration. The Company’s product candidates, LYR-210 and LYR-220, are bioresorbable polymeric implants designed to be administered in a non-invasive, in-office procedure and intended to deliver six months of continuous anti-inflammatory drug therapy to the sinonasal passages for the treatment of CRS. The Company was incorporated as a Delaware corporation on November 21, 2005 and is located in Watertown, Massachusetts. On July 16, 2018, the Company formally changed its name from 480 Biomedical, Inc. to Lyra Therapeutics, Inc.

The Company is subject to risks common to companies in the therapeutics and pharmaceutical industry, including but not limited to, risks of failure of pre-clinical studies and clinical trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the need to successfully commercialize and gain market acceptance of its product candidates, dependence on key personnel, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations, reliance on third-party manufacturers to manufacture materials for the Company’s research programs, pre-clinical studies, and clinical trials, the ability to transition from pilot-scale manufacturing to large-scale production of products and the need to obtain adequate additional financing to fund the development of its product candidates.

From inception through September 30, 2023, the Company has raised an aggregate of $397.0 million to fund its operations primarily from the equity financings, government grants and its License and Collaboration Agreement with LianBio discussed in Note 6. In addition, as discussed in Note 4, subsequent to September 30, 2023, on October 2, 2023, the Company sold an aggregate of 3,017,568 shares of common stock under the Sales Agreement, at a weighted average price of $3.71 per share, which generated net proceeds of $10.9 million. Proceeds from the Sales Agreement were not included in cash and cash equivalents or short-term investments as of September 30, 2023.

On May 25, 2023, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”), with the purchasers named therein (the “Investors”), pursuant to which the Company agreed to sell securities to the Investors in a private placement (the “Private Placement”). The Purchase Agreement provided for the sale and issuance by the Company of: (i) an aggregate of 17,652,962 shares (the “Shares”) of the Company’s common stock, par value $0.001 per share (the “Common Stock”), and pre-funded warrants to purchase up to 2,408,188 shares of Common Stock (the “Pre-Funded Warrants”), with an exercise price of $0.001 per share, and (ii) accompanying warrants to purchase up to 10,030,575 shares of Common Stock (the “Purchase Warrants”), with an exercise price of $2.673 per share, for aggregate gross proceeds of approximately $50.0 million, before deducting private placement expenses. Each Share (or Pre-Funded Warrant to purchase one share) was issued with an accompanying Purchase Warrant to purchase one-half of one share, and the combined effective purchase price per share (or Pre-Funded Warrant to purchase one share) and accompanying Purchase Warrant to purchase one-half of one share was $2.4925 (less the exercise price of the Pre-Funded Warrant, if applicable). Each Pre-Funded Warrant was exercisable immediately and will expire on May 31, 2028. Each Purchase Warrant will be exercisable at any time on or after November 30, 2023 and will expire on November 30, 2028.

The closing of the Private Placement occurred on May 31, 2023.

The Company has incurred recurring net losses since inception and has an accumulated deficit of approximately $296.2 million at September 30, 2023. The Company expects to continue to generate operating losses for the foreseeable future. At September 30, 2023, the Company had approximately $24.9 million of cash and cash equivalents and $77.7 million of short-term investments.

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company believes its cash and cash equivalents and short-term investments as of September 30, 2023 will be sufficient to fund the Company’s operating plan for a period of at least one year from the issuance date of the condensed consolidated financial statements.

The Company expects to incur increased costs as it progresses its product candidates through clinical development. The Company will need additional financing to support its continuing operations and to pursue its growth strategy. Until such time as the Company can generate significant revenue from product sales, if ever, it expects to finance its operations through a combination of equity or debt financings, collaboration agreements, strategic alliances and licensing arrangements. The Company may be unable to

raise additional funds or enter into such other agreements when needed on favorable terms or at all. The inability to obtain funding as and when needed would have a negative impact on the Company’s financial condition and ability to pursue its business strategies. If the Company is unable to obtain funding when needed, the Company could be forced to delay, reduce or eliminate some or all of its research and development programs, product portfolio expansion or commercialization efforts, which could adversely affect its business prospects, or the Company may be unable to continue operations. The Company will need to generate significant revenue to achieve profitability, and it may never do so.

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance 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 United States generally accepted accounting principles as found in the Accounting Standard Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”).

The condensed consolidated financial statements have been prepared on the same basis as the audited annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of September 30, 2023 and the results of its operations and its cash flows for the three and nine months ended September 30, 2023 and 2022. The results for the three and nine months ended September 30, 2023 are not necessarily indicative of results to be expected for the year ending December 31, 2023, any other interim periods, or any future year or period. These condensed consolidated financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2022, and the notes thereto, which are included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 29, 2023.

Leases - Schedule of Components of Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Lease Cost:
Operating lease cost	$ 483	$ 264	$ 1,371	$ 792
Variable lease cost	399	870	893	3,744
Total lease cost	$ 882	$ 1,134	$ 2,264	$ 4,536

Collaboration Agreement - Revenue Recognized Related to Each of the Performance Obligations and the Remaining Deferred Revenue (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($)
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Deferred revenue at December 31, 2022	$ 15,352
Revenue recognized	(1,412)
Deferred revenue at September 30, 2023	13,940
Combined Performance Obligation
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Deferred revenue at December 31, 2022	11,748
Deferred revenue at September 30, 2023	11,748
Development Activities Performance Obligation
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Deferred revenue at December 31, 2022	3,604
Revenue recognized	(1,412)
Deferred revenue at September 30, 2023	$ 2,192

Condensed Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 24,850	$ 32,550
Short-term investments	77,700	65,344
Prepaid expenses and other current assets	2,370	2,935
Total current assets	104,920	100,829
Property and equipment, net	726	2,243
Operating lease right-of-use assets	6,074	2,223
Restricted cash	1,392	1,392
Other assets	7,463	3,281
Total assets	120,575	109,968
Current liabilities:
Accounts payable	5,054	2,616
Accrued expenses and other current liabilities	11,052	9,030
Operating lease liabilities	1,403	1,549
Deferred revenue	1,726	1,275
Total current liabilities	19,235	14,470
Operating lease liabilities, net of current portion	4,887	667
Deferred revenue, net of current portion	12,214	14,077
Total liabilities	36,336	29,214
Commitments and contingencies (Note 9)
Stockholders’ equity:
Preferred stock, $0.001 par value, 10,000,000 shares authorized at September 30, 2023 and December 31, 2022; no shares issued and outstanding at September 30, 2023 and December 31, 2022
Common stock, $0.001 par value; 200,000,000 shares authorized at September 30, 2023 and December 31, 2022; 49,545,559 and 31,827,659 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively	50	32
Additional paid-in capital	380,395	329,387
Accumulated other comprehensive (loss) income, net of tax	(7)	10
Accumulated deficit	(296,199)	(248,675)
Total stockholders’ equity	84,239	80,754
Total liabilities and stockholders’ equity	$ 120,575	$ 109,968

Leases - Additional Information (Details) - USD ($)		1 Months Ended	3 Months Ended		9 Months Ended
Leases - Additional Information (Details) - USD ($)	May 31, 2021	May 31, 2022	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022	Apr. 30, 2021	Nov. 30, 2017
Lessee Lease Description [Line Items]
Restricted cash			$ 1,392,000		$ 1,392,000		$ 1,392,000
Option to extend lease		one additional 5-year term
Operating lease cost			483,000	$ 264,000	1,371,000	$ 792,000
Research and Development
Lessee Lease Description [Line Items]
Operating lease cost			0	$ 700,000	0	$ 3,200,000
Watertown Lease \| Clinical Supply Agreement
Lessee Lease Description [Line Items]
Operating lease period								5 years
Operating Lease, renewal term								1 year
Watertown Lease \| Letter of Credit
Lessee Lease Description [Line Items]
Secured debt obligations									$ 300,000
Waltham Lease
Lessee Lease Description [Line Items]
Debt instrument expiration date		Apr. 01, 2024
Waltham Lease \| Other assets
Lessee Lease Description [Line Items]
Prepaid rent			$ 6,300,000		$ 6,300,000
Waltham Lease \| Office and Laboratory
Lessee Lease Description [Line Items]
Initial base rent	$ 2,200,000
Operating lease period		10 years 2 months
Percentage of annual rent increment		3.00%
Waltham Lease \| Letter of Credit
Lessee Lease Description [Line Items]
Secured debt obligations		$ 1,100,000
Maximum \| Waltham Lease \| Office and Laboratory
Lessee Lease Description [Line Items]
Lease expiration date		Jul. 31, 2033

Stockholders' Equity (Tables)

9 Months Ended

Sep. 30, 2023

Equity [Abstract]

Summary of Warrants Outstanding and Exercisable

The following table represents a summary of the warrants outstanding and exercisable as of September 30, 2023, all of which are equity-classified:


				Number of shares Underlying Warrants
Issue Date	Exercise Price		Expiration Date	Outstanding		Exercisable
April 13, 2022	$	0.001	April 12, 2027		5,000,000		5,000,000
May 31, 2023	$	0.001	May 31, 2028		2,408,188		2,408,188
May 31, 2023	$	2.673	November 30, 2028		10,030,575		—
					17,438,763		7,408,188

Condensed Consolidated Statements of Stockholders' Equity (unaudited) - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss), net of tax	Accumulated Deficit
Balance at Dec. 31, 2021	$ 34,316	$ 13	$ 227,700		$ (193,397)
Balance, Shares at Dec. 31, 2021		13,007,178
Exercise of common stock options	8		8
Exercise of common stock options, Shares		2,718
Stock-based compensation	844		844
Net loss	(11,911)				(11,911)
Balance at Mar. 31, 2022	23,257	$ 13	228,552		(205,308)
Balance, Shares at Mar. 31, 2022		13,009,896
Balance at Dec. 31, 2021	34,316	$ 13	227,700		(193,397)
Balance, Shares at Dec. 31, 2021		13,007,178
Net loss	(41,043)
Balance at Sep. 30, 2022	93,222	$ 32	327,630		(234,440)
Balance, Shares at Sep. 30, 2022		31,827,008
Balance at Mar. 31, 2022	23,257	$ 13	228,552		(205,308)
Balance, Shares at Mar. 31, 2022		13,009,896
Issuance of common stock and pre-fundedwarrants, net of issuance costs	96,251	$ 19	96,232
Issuance of common stock and pre-funded warrants, net of issuance costs, Shares		18,815,159
Issuance of common stock upon RSU vesting, shares		1,302
Stock-based compensation	1,107		1,107
Net loss	(14,366)				(14,366)
Balance at Jun. 30, 2022	106,249	$ 32	325,891		(219,674)
Balance, Shares at Jun. 30, 2022		31,826,357
Issuance of common stock upon RSU vesting, shares		651
Stock-based compensation	1,739		1,739
Net loss	(14,766)				(14,766)
Balance at Sep. 30, 2022	93,222	$ 32	327,630		(234,440)
Balance, Shares at Sep. 30, 2022		31,827,008
Balance at Dec. 31, 2022	80,754	$ 32	329,387	$ 10	(248,675)
Balance, Shares at Dec. 31, 2022		31,827,659
Issuance of common stock upon RSU vesting, shares		7,041
Exercise of common stock options	4		4
Exercise of common stock options, Shares		2,115
Unrealized loss on available-for-sale securities	(22)			(22)
Stock-based compensation	1,610		1,610
Net loss	(16,255)				(16,255)
Balance at Mar. 31, 2023	66,091	$ 32	331,001	(12)	(264,930)
Balance, Shares at Mar. 31, 2023		31,836,815
Balance at Dec. 31, 2022	$ 80,754	$ 32	329,387	10	(248,675)
Balance, Shares at Dec. 31, 2022		31,827,659
Exercise of common stock options, Shares	57,897
Net loss	$ (47,524)
Balance at Sep. 30, 2023	84,239	$ 50	380,395	(7)	(296,199)
Balance, Shares at Sep. 30, 2023		49,545,559
Balance at Mar. 31, 2023	66,091	$ 32	331,001	(12)	(264,930)
Balance, Shares at Mar. 31, 2023		31,836,815
Issuance of common stock and pre-fundedwarrants, net of issuance costs	46,668	$ 18	46,650
Issuance of common stock and pre-funded warrants, net of issuance costs, Shares		17,652,962
Exercise of common stock options	97		97
Exercise of common stock options, Shares		55,262
Unrealized loss on available-for-sale securities	(15)			(15)
Stock-based compensation	1,354		1,354
Net loss	(15,618)				(15,618)
Balance at Jun. 30, 2023	98,577	$ 50	379,102	(27)	(280,548)
Balance, Shares at Jun. 30, 2023		49,545,039
Issuance costs	(150)		(150)
Exercise of common stock options	2		2
Exercise of common stock options, Shares		520
Unrealized gain on available-for-sale securities	20			20
Stock-based compensation	1,441		1,441
Net loss	(15,651)
Balance at Sep. 30, 2023	$ 84,239	$ 50	$ 380,395	$ (7)	$ (296,199)
Balance, Shares at Sep. 30, 2023		49,545,559

Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis


			Fair Value Measurements at Reporting Date Using
	September 30,		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	2023
Assets:
Cash equivalents
Money market funds	$	5,515	$	5,515		—		—
US treasury bills		15,937		15,937		—		—
Total cash equivalents	$	21,452	$	21,452	$	—	$	—
Short-term investments:
US treasury bills		58,244		58,244		—		—
Corporate Bonds and U.S. Government Agency Securities		19,456		4,066		15,390		—
Total Short-term investments	$	77,700	$	62,310	$	15,390	$	—


			Fair Value Measurements at Reporting Date Using
	December 31,		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	2022
Assets:

Cash equivalents
Money market funds	$	22,580	$	22,580	$	—	$	—
Corporate debt securities		7,089		2,098		4,991		—
Total cash equivalents	$	29,669	$	24,678	$	4,991	$	—
Short-term investments:
US treasury bills		2,966		2,966		—		—
Corporate Bonds and U.S. Government Agency Securities		62,378		4,732		57,646		—
Total Short-term investments	$	65,344	$	7,698	$	57,646	$	—

Stock-Based Compensation Expense (Tables)

9 Months Ended

Sep. 30, 2023

Share-Based Payment Arrangement [Abstract]

Summary of Restricted Stock Unit Activity

A summary of the restricted stock unit activity under the Plans for the nine months ended September 30, 2023 was as follows:


	Shares			Weighted- Average Grant Date Fair Value
Restricted stock units outstanding as of December 31, 2022		28,212		$	4.78
Granted		270,716		$	2.85
Vested		(7,041	)	$	4.78
Forfeited		(48,184	)	$	2.93
Restricted stock units outstanding as of September 30, 2023		243,703		$	3.00

Summary of Stock Option Activity Under Plans

A summary of the stock option activity under the Plans for the nine months ended September 30, 2023 was as follows:


	Shares			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (in years)		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2022		4,311,333		$	7.07		8.2	$	378
Granted		2,016,730			2.86
Exercised		(57,897	)		1.76
Cancelled		(431,489	)		8.09
Outstanding at September 30, 2023		5,838,677		$	5.59		8.3	$	2,649

Schedule of Fair Value of Stock Option Estimated on Date of Grant Using Black-Scholes Option-Pricing Model in Case of Options Granted to Executive Officers


	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Risk-free interest rate		4.3	%		3.2	%		3.7	%		2.6	%
Expected dividend yield		—	%		—	%		—	%		—	%
Expected term (in years)		6.1			6.1			6.0			3.7
Expected volatility		80.0	%		85.2	%		82.9	%		81.4	%

Schedule of Stock-Based Compensation Expense

Stock-based compensation expense included in the Company’s consolidated statements of operations and comprehensive loss was as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Research and development	$	294	$	229	$	865	$	665
General and administrative		1,147		1,510		3,540		3,025
Total	$	1,441	$	1,739	$	4,405	$	3,690

Fair Value Measurements - Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	$ 77,700	$ 65,344
Fair Value, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	21,452	29,669
Fair Value, Recurring [Member] \| Money Market Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	5,515	22,580
Fair Value, Recurring [Member] \| Corporate Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents		7,089
Fair Value, Recurring [Member] \| US Treasury Bills
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	15,937
Short-term investments	58,244	2,966
Fair Value, Recurring [Member] \| Corporate Bonds and U.S. Government Agency Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	19,456	62,378
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	21,452	24,678
Short-term investments	62,310	7,698
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 1 [Member] \| Money Market Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	5,515	22,580
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 1 [Member] \| Corporate Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents		2,098
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 1 [Member] \| US Treasury Bills
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	15,937
Short-term investments	58,244	2,966
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 1 [Member] \| Corporate Bonds and U.S. Government Agency Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	4,066	4,732
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents		4,991
Short-term investments	15,390	57,646
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 2 [Member] \| Corporate Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents		4,991
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 2 [Member] \| Corporate Bonds and U.S. Government Agency Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	$ 15,390	$ 57,646

Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Basis of Presentation

Comprehensive Loss

Restricted Cash


	September 30,		December 31,
	2023		2022
Cash and cash equivalents	$	24,850	$	32,550
Restricted cash		1,392		1,392
Total	$	26,242	$	33,942

Net Loss per Share


	Nine Months Ended September 30,
	2023		2022
Stock options		5,838,677		4,336,264
Common stock warrants		10,030,575		—
Restricted stock units		243,703		35,418
Total		16,112,955		4,371,682

Recently Issued Accounting Pronouncements

Summary of Significant Accounting Policies - Summary of Reconciliation of Cash, Cash Equivalents and Restricted Cash Reported within Balance Sheet (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents [Abstract]
Cash and cash equivalents	$ 24,850	$ 32,550
Restricted cash	1,392	1,392
Total	$ 26,242	$ 33,942

Leases - Summary of Maturity of Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Leases [Abstract]
Remainder of 2023	$ 519
2024	1,940
2025	1,997
2026	2,245
2027	756
Total maturities	7,457
Less: Amount representing interest	(1,167)
Present value of operating lease liability	6,290
Less: current portion of operating lease liability	(1,403)	$ (1,549)
Total operating lease liability, net of current portion	$ 4,887	$ 667

Summary of Significant Accounting Policies - Summary of Potentially Dilutive Securities Excluded from Calculation of Diluted Net Loss per Share (Details) - shares	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from calculation of diluted net loss per share	16,112,955	4,371,682
Stock options
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from calculation of diluted net loss per share	5,838,677	4,336,264
Common stock warrants
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from calculation of diluted net loss per share	10,030,575
Restricted stock units
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from calculation of diluted net loss per share	243,703	35,418

Stock-Based Compensation Expense - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of shares granted			2,016,730
Common stock shares issued	49,545,559		49,545,559		31,827,659
Stock-based compensation expense	$ 1,441	$ 1,739	$ 4,405	$ 3,690
Exercise price per share, granted			$ 2.86
Weighted-average fair value of options granted to employees, directors and non-employees	$ 2.57	$ 4.47	$ 2.08	$ 3.41
Stock Options
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized expense	$ 8,500		$ 8,500
Unrecognized share based compensation amount recognition term			2 years 3 months 29 days
Restricted Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized expense	$ 600		$ 600
Unrecognized share based compensation amount recognition term			3 years 2 months 23 days
2020 Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Shares available for grant			1,214,902
Inducement Award Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Shares available for grant			170,000

Leases - Summary of Weighted-Average Remaining Lease Term and Discount Rate Related to Operating Leases (Details)	Sep. 30, 2023
Leases [Abstract]
Weighted-average remaining lease term (in years)	3 years 7 months 6 days
Weighted-average discount rate	9.25%

Leases (Tables)

9 Months Ended

Sep. 30, 2023

Leases [Abstract]

Components of Lease Cost

The components of lease cost recorded in the Company’s condensed consolidated financial statements were as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Lease Cost:
Operating lease cost	$	483	$	264	$	1,371	$	792
Variable lease cost		399		870		893		3,744
Total lease cost	$	882	$	1,134	$	2,264	$	4,536

Summary of Weighted-Average Remaining Lease Term and Discount Rate Related to Operating Leases

The weighted-average remaining lease term and discount rate related to the Company’s operating leases were as follows:


	As of September 30, 2023
Weighted-average remaining lease term (in years)		3.6
Weighted-average discount rate		9.25	%

Summary of Maturity of Operating Lease Liabilities

Maturity of the Company’s operating lease liabilities in accordance with ASC 842 as of September 30, 2023 were as follows (in thousands):


Period ended December 31,
remainder of 2023		519
2024		1,940
2025		1,997
2026		2,245
2027		756
Total maturities		7,457
Less: Imputed interest		(1,167	)
Present value of operating lease liability		6,290
Less: current portion of operating lease liability		(1,403	)
Total operating lease liability, net of current portion	$	4,887

Subsequent Events - Additional Information (Details) - Subsequent Events $ / shares in Units, $ in Millions	Oct. 02, 2023 USD ($) $ / shares shares
Sales Agreement
Subsequent Event [Line Items]
Net proceeds \| $	$ 10.9
Common Stock
Subsequent Event [Line Items]
Issuance of common stock	3,017,568
Common Stock \| Sales Agreement
Subsequent Event [Line Items]
Issuance of common stock	3,017,568
Weighted average price \| $ / shares	$ 3.71

Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Statement [Abstract]
Collaboration revenue	$ 544	$ 359	$ 1,412	$ 1,352
Operating expenses:
Research and development	12,368	10,048	35,763	29,346
General and administrative	5,003	5,137	14,700	13,157
Loss on impairment of long-lived assets			1,592
Total operating expenses	17,371	15,185	52,055	42,503
Loss from operations	(16,827)	(14,826)	(50,643)	(41,151)
Other income:
Interest income	1,192	60	3,161	108
Total other income	1,192	60	3,161	108
Loss before income tax expense	(15,635)	(14,766)	(47,482)	(41,043)
Income tax expense	(16)		(42)
Net loss	(15,651)	(14,766)	(47,524)	(41,043)
Unrealized holding gain (loss) on short-term investments, net of tax	20		(17)
Comprehensive loss	$ (15,631)	$ (14,766)	$ (47,541)	$ (41,043)
Net loss per share attributable to common stockholders- basic	$ (0.27)	$ (0.4)	$ (1.04)	$ (1.47)
Net loss per share attributable to common stockholders- diluted	$ (0.27)	$ (0.4)	$ (1.04)	$ (1.47)
Weighted-average common shares outstanding-basic	56,953,685	36,826,364	45,894,643	28,014,434
Weighted-average common shares outstanding-diluted	56,953,685	36,826,364	45,894,643	28,014,434

Income Taxes (Additional Information) (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Tax Disclosure [Abstract]
Deferred tax assets, valuation allowance income tax expense (benefit)	$ 16,000	$ 0	$ 42,000	$ 0

Income Taxes

9 Months Ended

Sep. 30, 2023

Income Tax Disclosure [Abstract]

Income Taxes

7. Income Taxes

The Company records a provision or benefit for income taxes on pre-tax income or loss based on its estimated effective tax rate for the year. Given the Company’s uncertainty regarding future taxable income, the Company maintains a full valuation allowance on its deferred tax assets. The Company recorded an income tax expense of $16,000 for the three months ended September

30, 2023 and $42,000 for the nine months ended September 30, 2023. No income tax expense was recorded as of the three and nine months ended September 30, 2022.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//740/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-14

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-21

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 270
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482526/740-270-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-17

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

Stock-Based Compensation Expense - Schedule of Fair Value of Stock Option Estimated on Date of Grant Using Black-Scholes Option-Pricing Model or Monte Carlo Simulation in Case of Options Granted to Executive Officers (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
Risk-free interest rate	4.30%	3.20%	3.70%	2.60%
Expected term (in years)	6 years 1 month 6 days	6 years 1 month 6 days	6 years	3 years 8 months 12 days
Expected volatility	80.00%	85.20%	82.90%	81.40%