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Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2020	Apr. 30, 2020
Document And Entity Information Abstract
Entity Registrant Name	Entasis Therapeutics Holdings Inc.
Entity Central Index Key	0001724344
Document Type	10-Q
Document Period End Date	Mar. 31, 2020
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Common Stock, Shares Outstanding		14,614,073
Entity Shell Company	false
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 17,450	$ 16,034
Short-term investments	10,016	24,962
Grants receivable	901	1,232
Prepaid expenses	2,932	4,560
Other current assets	1,485	2,218
Total current assets	32,784	49,006
Property and equipment, net	308	345
Operating lease right-of-use assets	1,505	1,620
Other assets	63	63
Total assets	34,660	51,034
Current liabilities:
Accounts payable	1,150	1,304
Accrued expenses and other current liabilities	4,633	6,252
Total current liabilities	5,783	7,556
Operating lease liabilities, net of current portion	1,173	1,321
Total liabilities	6,956	8,877
Commitments (Notes 5 and 11)
Stockholders’ equity:
Common stock, par value $0.001; 125,000,000 shares authorized and 13,291,563 shares issued and outstanding as of March 31, 2020 and December 31, 2019	13	13
Additional paid-in capital	176,888	176,103
Accumulated other comprehensive income	28
Accumulated deficit	(149,225)	(133,959)
Total stockholders’ equity	27,704	42,157
Total liabilities and stockholders’ equity	$ 34,660	$ 51,034

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2020	Dec. 31, 2019
CONSOLIDATED BALANCE SHEETS
Common stock par value (in dollar per share)	$ 0.001	$ 0.001
Common stock authorized (in shares)	125,000,000	125,000,000
Common stock issued (in shares)	13,291,563	13,291,563
Common stock outstanding (in shares)	13,291,563	13,291,563

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Operating expenses:
Research and development	$ 11,623	$ 11,002
General and administrative	3,780	3,189
Total operating expenses	15,403	14,191
Loss from operations	(15,403)	(14,191)
Other income:
Grant income	13	829
Interest income	124	492
Total other income	137	1,321
Loss before income taxes	(15,266)	(12,870)
Provision for income taxes		71
Net loss	$ (15,266)	$ (12,941)
Net Loss per Share
Net loss per share—basic and diluted (in dollar per share)	$ (1.15)	$ (0.99)
Weighted average common stock outstanding—basic and diluted (in shares)	13,291,563	13,126,595
Other comprehensive loss:
Net loss	$ (15,266)	$ (12,941)
Net unrealized gain on investments held	28	43
Comprehensive loss	$ (15,238)	$ (12,898)

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Total
Balance at Dec. 31, 2018	$ 13	$ 172,988	$ (9)	$ (90,109)	$ 82,883
Balance (in shares) at Dec. 31, 2018	13,124,842
Stock-based compensation expense		578			578
Exercise of stock options		11			11
Exercise of stock options (in shares)	2,286
Unrealized gain on investments held			43		43
Net loss				(12,941)	(12,941)
Balance at Mar. 31, 2019	$ 13	173,577	34	(103,050)	70,574
Balance (in shares) at Mar. 31, 2019	13,127,128
Balance at Dec. 31, 2019	$ 13	176,103		(133,959)	42,157
Balance (in shares) at Dec. 31, 2019	13,291,563
Stock-based compensation expense		785			785
Unrealized gain on investments held			28		28
Net loss				(15,266)	(15,266)
Balance at Mar. 31, 2020	$ 13	$ 176,888	$ 28	$ (149,225)	$ 27,704
Balance (in shares) at Mar. 31, 2020	13,291,563

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash flows from operating activities:
Net loss	$ (15,266)	$ (12,941)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense	37	40
Stock-based compensation expense	785	578
Amortization and accretion of investments	(27)	(195)
Changes in operating assets and liabilities:
Grants receivable	331	(22)
Prepaid expenses	1,628	(340)
Other assets	1,032	(2,208)
Accounts payable	(154)	2,747
Accrued expenses and other liabilities	(1,934)	1,917
Deferred rent		(175)
Net cash used in operating activities	(13,568)	(10,599)
Cash flows from investing activities:
Purchases of property and equipment		(37)
Proceeds from maturities of short-term investments	15,000
Purchases of short-term investments		(25,050)
Net cash provided by (used in) investing activities	15,000	(25,087)
Cash flows from financing activities:
Proceeds from exercise of stock options		11
Payments of initial public offering costs		(150)
Payments of financing costs	(16)
Net cash used in financing activities	(16)	(139)
Net increase (decrease) in cash and cash equivalents	1,416	(35,825)
Cash and cash equivalents at beginning of the period	16,034	49,360
Cash and cash equivalents at end of the period	17,450	$ 13,535
Supplemental disclosure of non-cash investing and financing activities:
Deferred financing costs included in accrued expenses and other current liabilities	$ 166

Organization and Description of Business	3 Months Ended
Organization and Description of Business	Mar. 31, 2020
Organization and Description of Business
Organization and Description of Business	1. Organization and Description of Business Entasis Therapeutics Holdings Inc., or Entasis, or the Company, is an advanced clinical‑stage biopharmaceutical company focused on the discovery, development and commercialization of novel antibacterial products to treat serious infections caused by multidrug-resistant Gram‑negative bacteria. The Company has four subsidiaries: Entasis Therapeutics Limited; Entasis Therapeutics Inc.; Entasis Therapeutics Security Corporation; and Entasis Therapeutics (Ireland) Limited. The Company was initially formed as Entasis Therapeutics Limited, or Entasis Limited, on March 6, 2015 in the United Kingdom, or the U.K., as a wholly owned subsidiary of AstraZeneca AB, or AstraZeneca. Entasis was ultimately spun out from AstraZeneca in May 2015. In March 2018, as part of a corporate reorganization, Entasis Limited formed Entasis Therapeutics Holdings Inc., a Delaware corporation, which became the sole shareholder of Entasis Limited. Upon the completion of a reorganization on April 23, 2018, the historical consolidated financial statements of Entasis Limited became the historical consolidated financial statements of Entasis Therapeutics Holdings Inc. On September 28, 2018, the Company completed an initial public offering of its common stock, in which the Company issued and sold 5,000,000 shares of common stock at a price to the public of $15.00 per share. The aggregate net proceeds to the Company from the initial public offering were approximately $65.6 million after deducting underwriting discounts and commissions and offering expenses paid by the Company. Upon the completion of the Company’s initial public offering, all of the outstanding shares of redeemable convertible preferred stock of the Company, including accrued dividends, automatically converted into 8,084,414 shares of the Company’s common stock. Risks and Uncertainties As of March 31, 2020, the Company had $27.5 million in cash, cash equivalents and short-term investments, and an accumulated deficit of $149.2 million. Since its inception through March 31, 2020, the Company has funded its operations primarily with proceeds from the sale of redeemable convertible preferred stock and the sale of its common stock. The Company has also either directly received funding or financial commitments from, or has had its program activities conducted and funded by, United States government agencies and non-profit entities. In the absence of positive cash flows from operations, the Company is highly dependent on its ability to find additional sources of funding in the form of debt, equity financing, strategic collaborations, or partnerships. As discussed further in Note 13, Subsequent Events, in April 2020 the Company entered into a securities purchase agreement with Innoviva, Inc. pursuant to which the Company expects to receive aggregate gross proceeds of $35 million. The Company believes its existing cash, cash equivalents and short-term investments, together with proceeds to be received from this transaction will enable it to fund its operating expenses and capital requirements through one year from the date of this filing. As a clinical-stage company, Entasis is subject to a number of risks common to other life science companies, including, but not limited to, raising additional capital, development by its competitors of new technological innovations, risk of failure in preclinical and clinical studies, safety and efficacy of its product candidates in clinical trials, the risk of relying on external parties such as contract research organizations and contract manufacturing organizations the regulatory approval process, market acceptance of the Company’s products once approved, lack of marketing and sales history, dependence on key personnel and protection of proprietary technology. The Company’s therapeutic programs are currently pre-commercial, spanning discovery through late-stage development and will require additional research and development efforts, including the completion of Phase 3 registration trials and regulatory approval, prior to commercialization of any product candidates. These efforts require significant amounts of additional capital, adequate personnel, infrastructure, and extensive compliance-reporting capabilities. There can be no assurance that the Company’s research and development will be successfully completed, that adequate protection for the Company’s intellectual property will be obtained, that any products developed will obtain necessary regulatory approval or that any approved products will be commercially viable. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will generate revenue from product sales. The Company may never achieve profitability, and unless and until it does, it will continue to need to raise additional capital or obtain financing from other sources, such as strategic collaborations or partnerships. The global outbreak of a novel strain of coronavirus (COVID-19) has, and will likely continue to have, a significant impact on the U.S. economy and businesses. The social distancing and stay-at-home orders issued by national, state and local governments have resulted in closures of offices and factories and disrupted supply chains. The pandemic also has taxed healthcare systems both in the U.S. and around the world, resulting in disruption to or temporary suspension of clinical trials. As a result of these changes, the timelines for completion of our clinical trials and earlier-stage development programs may be impacted. The nature and extent of the impact remains uncertain as the duration of the outbreak and the time needed for businesses and healthcare systems to recover remains unknown. The full impact of the pandemic on economy, including the capital markets, also remains unknown. Some economists and major investment banks have expressed concern that the continued spread of the virus globally could lead to a world-wide economic downturn or recession and, by extension, limit our access to financial resources from the capital markets and other sources. It is not possible to predict the full impact of the COVID-19 pandemic on our business and access to capital in the future.

Summary of Significant Accounting Policies	3 Months Ended
Summary of Significant Accounting Policies	Mar. 31, 2020
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Significant Accounting Policies The Company’s significant accounting policies are disclosed in the audited consolidated financial statements for the year ended December 31, 2019 and the notes thereto, which are included in the Company’s most recent Annual Report on Form 10-K. Since the date of those consolidated financial statements, there have been no material changes to its significant accounting policies. Basis of Presentation and Consolidation The accompanying consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP, and pursuant to the instructions to Form 10-Q and Article 10 of Regulation S-X. The December 31, 2019 consolidated balance sheet was derived from audited consolidated financial statements. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements, which are contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the Securities and Exchange Commission, or SEC, on March 11, 2020. The interim consolidated financial statements have been prepared on the same basis as the annual audited consolidated financial statements and, in the opinion of management, reflect all normal and recurring adjustments necessary for a fair statement of the Company’s financial position and results of operations. The accompanying consolidated financial statements include the Company’s accounts and those of the Company’s wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The results for the three months ended March 31, 2020 are not necessarily indicative of the results to be expected for the year ending December 31, 2020, any other interim periods, or any future year or period. Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the recognition of revenue, and the recognition of certain development costs. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from the Company’s estimates. Recently Adopted Accounting Pronouncements Effective January 1, 2020, the Company adopted the requirements under the FASB ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, which eliminates, adds and modifies certain disclosure requirements for fair value measurements. The adoption of the new guidance did not affect the Company’s consolidated financial statements. Effective January 1, 2020, the Company adopted the provisions of FASB ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606. This update clarifies the interaction between Topic 808, Collaborative Arrangements, and Topic 606, Revenue from Contracts with Customers. The guidance is required to be applied retrospectively to the date of initial application of Topic 606 and entities should recognize the cumulative effect of initially applying the amendments as an adjustment to the opening balance of retained earnings of the later of the earliest annual period presented and the annual period that includes the date of the entity’s initial application of Topic 606. The adoption of the new guidance did not affect the Company’s consolidated financial statements and did not require an adjustment to the opening balance of retained earnings. Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, or ASU 2019-12. The amendments in ASU 2019-12 are effective for fiscal years beginning after December 15, 2020, including interim periods therein. Early adoption of the standard is permitted. The Company does not anticipate that the adoption of ASU 2019-12 will have a material effect on the Company’s consolidated financial statements.

Short-Term Investments

3 Months Ended

Mar. 31, 2020

Short-Term Investments.

Short-Term Investments

3. Short-Term Investments

The following table summarizes the amortized cost and estimated fair value of the Company’s marketable securities, which are considered to be available-for-sale investments and are included in short-term investments on the consolidated balance sheets:


	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(in thousands)
Balance as of March 31, 2020:
U.S. Treasury securities	$	9,991	$	25	$	—	$	10,016
Total	$	9,991	$	25	$	—	$	10,016


	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(in thousands)
Balance as of December 31, 2019:
U.S. Treasury securities	$	24,957	$	5	$	—	$	24,962
Total	$	24,957	$	5	$	—	$	24,962

Certain short-term debt securities with original maturities of less than 90 days are included in cash and cash equivalents on the consolidated balance sheets and are not included in the tables above. As of March 31, 2020 and December 31, 2019, all short-term investments have contractual maturities within one year.

Fair Value of Financial Instruments

3 Months Ended

Mar. 31, 2020

Fair Value of Financial Instruments

Fair Value of Financial Instruments

4. Fair Value of Financial Instruments

The following tables set forth the Company’s assets that were accounted for at fair value on a recurring basis:


	March 31, 2020
	Fair Value Measurement Using
	Level 1		Level 2		Level 3		Total
	(in thousands)
Cash equivalents:
Money market funds	$	9,038	$	—	$	—	$	9,038
Short-term investments:
U.S. Treasury securities		10,016		—		—		10,016
Total	$	19,054	$	—	$	—	$	19,054


	December 31, 2019
	Fair Value Measurement Using
	Level 1		Level 2		Level 3		Total
	(in thousands)
Cash equivalents:
Money market funds	$	13,949	$	—	$	—	$	13,949
Short-term investments:
U.S. Treasury securities		24,962		—		—		24,962
Total	$	38,911	$	—	$	—	$	38,911

The Company classifies its money market funds and U.S. Treasury securities as Level 1 assets under the fair value hierarchy, as these assets have been valued using quoted market prices in active markets without any valuation adjustment.

The Company uses the carrying amounts of its cash equivalents, grants receivable, accounts receivable, prepaid expenses, other current assets, accounts payable and accrued expenses and other current liabilities to approximate their fair value due to the short-term nature of these amounts.

- 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

Leases

3 Months Ended

Mar. 31, 2020

Leases

Leases

5. Leases

The Company adopted FASB ASC 842, Leases, or ASC 842, on January 1, 2019. ASC 842 allows the Company to elect a package of practical expedients, which include: (i) an entity need not reassess whether any expired or existing contracts are or contain leases; (ii) an entity need not reassess the lease classification for any expired or existing leases; and (iii) an entity need not reassess any initial direct costs for any existing leases. Another practical expedient allows the Company to use hindsight in determining the lease term when considering lessee options to extend or terminate the lease and to purchase the underlying asset. The Company elected to utilize this package of practical expedients and elected not to use the hindsight methodology in its implementation of ASC 842.

The Company determined that it held one significant operating lease as of January 1, 2019, consisting of 20,062 square feet of office and laboratory space in Waltham, Massachusetts that expires in December 2022 pursuant to a May 2015 lease with AstraZeneca, or the AZ lease, as amended in February 2018. During the three months ended March 31, 2020 and 2019, the Company recorded lease expense of $0.2 million related to this lease. The Company has two additional operating leases that are included in its lease accounting which are not considered significant.

In calculating the present value of future lease payments, the Company utilized its incremental borrowing rate based on the remaining lease term at the date of adoption. The AZ lease contains a renewal option that can extend the lease for three years. Because the Company is not reasonably certain to exercise this renewal option, the option is not considered in determining the lease term, and associated potential additional payments are excluded from lease payments. The Company elected to account for each lease component and its associated non-lease components as a single lease component and has allocated all of the contract consideration across lease components only. The Company has existing net leases in which the non-lease components (e.g., common area maintenance) are paid separately from rent based on actual costs incurred and therefore are not included in the operating lease right-of-use assets and lease liabilities and are reflected as an expense in the period incurred.

The following table summarizes the presentation of the Company’s operating leases in its consolidated balance sheets (in thousands):


	As of		As of
	March 31, 2020		December 31, 2019
Assets
Operating lease right-of-use assets	$	1,505	$	1,620

Liabilities
Operating lease liabilities, current	$	544	$	506
Operating lease liabilities, net of current portion		1,173		1,321
Total operating lease liabilities	$	1,717	$	1,827

The operating lease right-of-use assets and operating lease liabilities balances relate primarily to amounts associated with the AZ lease. Future minimum lease payments under non-cancelable leases as of March 31, 2020, were as detailed below (in thousands):


Fiscal Year	As of March 31, 2020
2020 (remaining 9 months)	$	508
2021		717
2022		737
2023		1
Total undiscounted lease payments		1,963
Less: imputed interest		(246)
Total operating lease liabilities	$	1,717

As of March 31, 2020, the weighted average remaining lease term was 2.8 years and the weighted-average incremental borrowing rate used to determine the operating lease right-of-use assets was 9.1%.

Accrued Expenses and Other Current Liabilities

3 Months Ended

Mar. 31, 2020

Accrued Expenses and Other Current Liabilities.

Accrued Expenses and Other Current Liabilities

6. Accrued Expenses and Other Current Liabilities

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


	March 31,		December 31,
	2020		2019
Accrued compensation and benefits	$	995	$	2,490
Accrued contract manufacturing		1,578		1,550
Accrued clinical		405		606
Accrued professional services		756		530
Accrued research		186		275
Current portion of operating lease liabilities		544		506
Other		169		295
Total accrued expenses and other current liabilities	$	4,633	$	6,252

Funding Arrangements	3 Months Ended
Funding Arrangements	Mar. 31, 2020
Funding Arrangements
Funding Arrangements	7. Funding Arrangements In March 2017 and October 2017, the Company entered into funding arrangements with the Trustees of Boston University to utilize funds from the U.S. government through the Combating Antibiotic Resistant Bacteria Biopharmaceutical Accelerator, or CARB‑X, program, in support of our ETX0282 and ETX0462 programs. In September 2019, the funding arrangements were amended to increase the amount of specified research expenditures of the Company that could be covered from $16.4 million to up to $16.8 million from April 2017 through September 2021. The Company recognized grant income in connection with the CARB-X agreements of $13,000 and $0.8 million during the three months ended March 31, 2020 and 2019, respectively. The Company received $0.4 million and $0.6 million of payments under the grants during the three months ended March 31, 2020 and 2019, respectively. As of March 31, 2020 and December 31, 2019, the Company’s receivables for unreimbursed, eligible costs incurred under the CARB-X agreements totaled $0.9 million and $1.2 million, respectively.

License and Collaboration Agreements	3 Months Ended
License and Collaboration Agreements	Mar. 31, 2020
License and Collaboration Agreements
License and Collaboration Agreements	8. License and Collaboration Agreements GARDP In July 2017, the Company entered into a collaboration agreement with the Global Antibiotic Research and Development Partnership, or GARDP, for the development, manufacture and commercialization of the product candidate zoliflodacin in certain countries. Under the terms of the collaboration agreement, GARDP will use commercially reasonable endeavors to perform and fully fund the Phase 3 registration trial, including the manufacture and supply of the product candidate containing zoliflodacin, in uncomplicated gonorrhea. The Phase 3 registration trial was initiated in September 2019. Given the focus at our clinical trial sites to address the immediate medical needs due to the COVID-19 pandemic, GARDP, with our full agreement, has made the decision to temporarily suspend patient enrollment into the Phase 3 registration trial at U.S. sites and activation of new clinical trial sites in ex-U.S. regions. Zai Lab In April 2018, the Company entered into a license and collaboration agreement with Zai Lab (Shanghai) Co., Ltd., or Zai Lab, pursuant to which Zai Lab licensed exclusive rights to durlobactam and sulbactam-durlobactam, or SUL-DUR, in the Asia‑Pacific region, or the Zai Agreement. Under the terms of the Zai Agreement, Zai Lab will fund most of the Company’s clinical trial costs in China for SUL-DUR, including all costs in China for the Company’s Phase 3 registration trial of SUL-DUR, with the exception of Phase 3 patient drug supply. Zai Lab will conduct development activities and plan and obtain regulatory approval in a specified number of countries in the Asia‑Pacific region beyond China after regulatory approval of a licensed product in China. Zai Lab is also solely responsible for commercializing licensed products in the Asia‑Pacific region and will commercialize licensed products for which it has obtained regulatory approval. The Company is obligated to conduct specified development activities for the Asia‑Pacific region. The Company is also obligated to supply Zai Lab with the licensed products for clinical development, although Zai Lab may take over manufacturing responsibilities for its own commercialization activities within a specified time period following the effective date of the Zai Agreement. Both parties are prohibited from developing and commercializing products in the Asia‑Pacific region that would compete with the licensed products. The Company received an upfront, non‑refundable payment of $5.0 million, milestone payments of $7.0 million, research support funding of $0.6 million and certain other reimbursable registration trial costs of $2.0 million, less applicable taxes of $2.0 million from Zai Lab through March 2020. During the three months ended March 31, 2020 and 2019, the Company recognized no revenue under the Zai Agreement. The Company is eligible to receive up to an aggregate of $91.0 million in additional research and development support payments and development, regulatory and sales milestone payments related to SUL-DUR, imipenem and other combinations with the licensed products. In the event the China Food and Drug Administration requires a modification or supplement to the trial protocol, and the Company delays Zai Lab from proceeding with such modified protocol and subsequently obtaining regulatory approval for the pivotal study of SUL-DUR in China, then the future sales‑based milestone payments that become due to the Company will be reduced by an agreed upon amount that increases with the length of the delay. Zai Lab will pay the Company a tiered royalty equal to a high‑single digit to low‑double digit percentage based on annual net sales of licensed products in the territory, subject to specified reductions for the market entry of competing products, loss of patent coverage of licensed products and for payments owed to third parties for additional rights necessary to commercialize licensed products in the territory. The Company determined the $5.0 million non‑refundable upfront payment was the entire transaction price at the outset of the Zai Agreement. All other future potential milestone payments were excluded from the transaction price as they were fully constrained as the risk of significant reversal of revenue had not yet been resolved. At the outset of the Zai Agreement, the achievement of the future potential milestones was not within the Company’s control and was subject to certain research and development success, regulatory approvals or commercial success and therefore carried significant uncertainty. The Company reevaluates the likelihood of achieving the future milestones at the end of each reporting period. Future development milestone revenue from the arrangement will be recognized as revenue in the period when it is no longer probable that revenue attributable to the milestone will result in a significant reversal of cumulative revenue. Payments received for research support and reimbursable clinical trial costs are recorded as an offset to research and development expense during the period in which the qualifying expenses are incurred. The Company evaluated the Zai Agreement under Topic 606 and identified two material promises: (1) an exclusive license to develop, manufacture and commercialize products containing durlobactam or SUL-DUR in the territory and (2) the initial technology transfer of licensed know‑how. The Company determined that the exclusive license and initial technology transfer were not distinct from one another, as the license has limited value without the transfer of the Company’s technology and Zai Lab would incur additional costs to recreate the Company’s know‑how. Therefore, the license and initial technology transfer were combined as a single performance obligation.

Stockholders' Equity and Stock-Based Compensation Expense

3 Months Ended

Mar. 31, 2020

Stockholders' Equity and Stock-Based Compensation Expense

Stockholders' Equity and Stock-Based Compensation Expense

9. Stockholders’ Equity and Stock‑Based Compensation Expense

Aspire Common Stock Purchase Agreement

In October 2019, the Company entered into a common stock purchase agreement, or CSPA, with Aspire Capital Fund, LLC, or Aspire, which provided that, upon the terms and subject to the conditions and limitations set forth therein, Aspire is committed to purchase up to an aggregate of $20.0 million of shares of the Company’s common stock over the 30-month term of the CSPA. Under the CSPA, on any trading day selected by the Company on which the closing price of its common stock is equal to or greater than $0.25 per share, the Company has the right, in its sole discretion, to present Aspire with a purchase notice directing Aspire to purchase up to 50,000 shares of common stock per business day, at a purchase price equal to the lesser of the lowest sale price of common stock on the purchase date, or the arithmetic average of the three lowest closing sale prices during the 10 consecutive business days ending on the trading day immediately preceding the purchase date. The Company and Aspire also may mutually agree to increase the number of shares that may be sold to as much as 2,000,000 shares per business day.

In addition, on any date on which the Company submits a purchase notice to Aspire in an amount equal to 50,000 shares, the Company also has the right, in its sole discretion, to present Aspire with a volume-weighted average price purchase notice, or the VWAP Purchase Notice, directing Aspire to purchase an amount of stock equal to up to 30% of the aggregate shares of the Company’s common stock traded on its principal market on the next trading day, or the VWAP Purchase Date, subject to a maximum number of shares the Company may determine. The purchase price per share pursuant to such VWAP Purchase Notice is generally 97% of the volume-weighted average price for the Company’s common stock traded on its principal market on the VWAP Purchase Date.

Under the CSPA, the Company controls the timing and amount of any sales to Aspire, and is not limited with respect to use of proceeds or by any financial or business covenants, restrictions on future financings, rights of first refusal, participation rights, penalties or liquidated damages in the CSPA. The CSPA may be terminated by the Company at any time, at its discretion, without any cost to the Company. Aspire has no trading volume requirements or restrictions and has no right to require any sales by the Company but is obligated to make purchases as directed by the Company in accordance with the CSPA. Aspire has agreed that neither it nor any of its agents, representatives and affiliates shall engage in any direct or indirect short-selling or hedging of common stock during any time prior to the termination of the CSPA.

The CSPA further provides that the number of shares that may be sold pursuant to the CSPA will be limited to 2,626,165 shares, including 104,167 shares of common stock issued to Aspire as a commitment fee, which represented 19.99% of the Company’s outstanding shares of common stock as of October 21, 2019, unless stockholder approval is obtained to issue more than 19.99%. This limitation will not apply under certain circumstances specified in the CSPA. During the quarter ended March 31, 2020, there were no shares purchased by Aspire pursuant to the CSPA.

Concurrently with entering into the CSPA, the Company also entered into a registration rights agreement with Aspire, pursuant to which the Company filed with the SEC a prospectus supplement to the Company’s effective shelf registration statement on Form S-3 (File No. 333-234041), registering all of the shares of common stock that may be offered to Aspire from time to time under the CSPA. The Company’s ability to sell shares to Aspire under the CSPA is subject to certain limitations arising under the Securities Purchase Agreement with Innoviva, which is discussed in Note 13, Subsequent Events.

Stock Incentive Plans

In September 2018, the Company’s board of directors adopted, and its stockholders approved the 2018 Equity Incentive Plan, or the 2018 Plan, which became effective on September 25, 2018, at which point no further grants will be made under the 2015 Stock Incentive Plan, or the 2015 Plan. Under the 2018 Plan, the Company may grant incentive stock options, or ISOs, non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock units and other stock-based awards. As of March 31, 2020, options to purchase an aggregate of 2,226,406 shares had been granted and 150,720 shares were available for future issuance under the 2018 Plan.

At its inception, the aggregate number of shares of the Company’s common stock available for issuance under the 2018 Plan was 2,350,000. The number of shares of the Company’s common stock reserved for issuance under the 2018 Plan automatically increases on January 1 of each year, for a period of 10 years, from January 1, 2019 continuing through January 1, 2028, by 4% of the total number of shares of the Company’s common stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares as may be determined by the Company’s board of directors. Accordingly, on January 1, 2020 and 2019, 531,662 and 524,993 shares were added to the number of available shares, respectively. The maximum number of shares that may be issued pursuant to the exercise of ISOs under the 2018 Plan is 7,500,000.

The maximum number of shares of the Company’s common stock subject to awards granted under the 2018 Plan or otherwise during a single calendar year to any nonemployee director, taken together with any cash fees paid by the Company to such nonemployee director during the calendar year for serving on the Company’s board of directors, will not exceed $500,000 in total value, or, with respect to the calendar year in which a nonemployee director is first appointed or elected to the Company’s board of directors, $800,000.

All options and awards granted under the 2015 Plan consisted of the Company’s common stock. As of September 25, 2018, no additional stock awards have been or will be granted under the 2015 Plan. Although the 2015 Plan was terminated as to future awards in September 2018, it continues to govern the terms of options that remain outstanding under the 2015 Plan.

Stock Option Activity

Stock option activity under both plans during the three months ended March 31, 2020 is summarized as follows:


				Weighted-
		Weighted-		Average
		Average		Remaining	Aggregate
	Number of	Exercise		Contractual	Intrinsic
	Options	Price		Term (Years)	Value (in thousands)
Outstanding as of December 31, 2019	2,388,400	$	6.20	8.44	$	906
Granted	839,200		4.87
Exercised	—		—
Forfeited	(11,100)		5.01
Outstanding as of March 31, 2020	3,216,500	$	5.86	8.58	$	—

Exercisable as of March 31, 2020	1,110,613	$	5.66	7.50	$	—

The aggregate intrinsic value of options is calculated as the difference between the exercise price of the options and the fair value of the Company’s common stock for those options that had exercise prices lower than the fair value of the Company’s common stock.

During the three months ended March 31, 2020, the weighted-average grant date fair value per granted option was $3.34.

Employee Stock Purchase Plan

In September 2018, the Company’s board of directors and its stockholders approved the 2018 Employee Stock Purchase Plan, or the ESPP, which became effective as of September 25, 2018. The ESPP is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the U.S. Internal Revenue Code of 1986, as amended. The number of shares of common stock initially reserved for issuance under the ESPP was 140,000 shares. The ESPP provides for an annual increase on the first day of each year beginning in 2019 and ending in 2028, in each case subject to the approval of the board of directors, equal to the lesser of (i) 1% of the shares of common stock outstanding on the last day of the prior fiscal year or (ii) 250,000 shares; provided, that prior to the date of any such increase, the board of directors may determine that such increase will be less than the amount set forth in clauses (i) and (ii). Pursuant to the terms of the 2018 Employee Stock Purchase Plan, an additional 132,915 and 131,248 shares were added to the number of available shares effective January 1, 2020 and 2019, respectively. As of March 31, 2020, no shares of common stock had been issued under the ESPP and 404,163 shares remained available for future issuance under the ESPP. No offering period under the ESPP has been set by the Company’s board of directors.

Stock‑Based Compensation

Stock‑based compensation expense was classified in the consolidated statement of operations as follows (in thousands):


	Three Months Ended March 31,
	2020		2019
Research and development	$	349	$	232
General and administrative		436		346
Total stock-based compensation expense	$	785	$	578

As of March 31, 2020, total unrecognized stock‑based compensation expense related to unvested options was $8.0 million, which is expected to be recognized over the weighted average period of approximately 2.9 years. The total unrecognized stock-based compensation expense will be adjusted for actual forfeitures as they occur.

Net Loss per Share	3 Months Ended
Net Loss per Share	Mar. 31, 2020
Net Loss per Share
Net Loss per Share	10. Net Loss per Share Basic net loss per share is calculated by dividing net loss by the weighted average number of shares of common stock outstanding for the period, without consideration for common stock equivalents. The Company’s potentially dilutive shares, which include outstanding stock options, are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. Options to purchase 3,216,500 and 1,966,976 shares of common stock as of March 31, 2020 and 2019, respectively, were excluded from the calculation of net loss per share due to their anti-dilutive effect.

Commitments	3 Months Ended
Commitments	Mar. 31, 2020
Commitments
Commitments	11. Commitments Lease Commitments The Company has an operating lease agreement for its office and laboratory space with AstraZeneca. See Note 5, Leases, for additional information. A Subscription Agreement In connection with the Company’s 2015 spin-out from AstraZeneca, the Company entered into a business transfer and subscription agreement with AstraZeneca pursuant to which the Company agreed to pay AstraZeneca a one‑time milestone payment of $5.0 million within three months of achieving a specified cumulative net sales milestone for durlobactam. This milestone payment will be automatically waived should the Company’s common stock trade on The Nasdaq Global Market at or above a specified price at any time prior to achieving such specified cumulative net sales milestone for durlobactam. The Company is also obligated to pay AstraZeneca a one‑time milestone payment of $10.0 million within two years of achieving the first commercial sale of zoliflodacin. At the Company’s election, either milestone payment may be paid in cash, common stock, or a combination of cash and common stock. Additionally, the Company is obligated to pay AstraZeneca tiered, single‑digit, per‑country royalties on the annual worldwide net sales of durlobactam and zoliflodacin.

Related Party Transactions	3 Months Ended
Related Party Transactions	Mar. 31, 2020
Related Party Transactions
Related Party Transactions	12. Related Party Transactions AstraZeneca The Company was formed in May 2015 as a wholly owned subsidiary of AstraZeneca. Prior to the closing of the initial public offering on September 28, 2018, AstraZeneca was the sole series A preferred stockholder. Upon the closing of the initial public offering, all shares of preferred stock converted into shares of common stock of the Company. AstraZeneca continues to maintain an ownership interest in the Company. The Company has an operating lease agreement for its office and laboratory space with AstraZeneca. See Note 5, Leases, for additional information. Pharmaron Beijing Co., Ltd. (China) The Company contracts with Pharmaron Beijing Co., Ltd. (China), or Pharmaron, to provide various medicinal chemistry research, manufacturing development and clinical services related to the Company’s ongoing product candidates. The Company began utilizing Pharmaron as a service provider prior to the spin-out in 2015 (see Note 1, Organization and Description of Business, to these notes to consolidated financial statements), and this relationship has continued into 2020. In 2019, the Senior Vice President of Strategic Partnerships at Pharmaron began sharing a household with the Company’s Chief Executive Officer, and as a result the Company now considers the agreements between the Company and Pharmaron to be related-party transactions. The Company recorded expense of $0.9 million and $2.2 million during the three months ended March 31, 2020 and 2019, respectively, for services rendered pursuant to multiple Pharmaron agreements. Amounts due to Pharmaron were $0.2 million and $0.8 million and as of March 31, 2020 and December 31, 2019, respectively.

Subsequent Events	3 Months Ended
Subsequent Events	Mar. 31, 2020
Subsequent Events
Subsequent Events	13. Subsequent Events Securities Purchase Agreement On April 12, 2020, the Company entered into a securities purchase agreement, or the Securities Purchase Agreement, with Innoviva, Inc., or Innoviva, pursuant to which the Company agreed to issue and sell to Innoviva, in a private placement under the applicable Nasdaq Stock Market LLC, or Nasdaq, rules up to 14,000,000 newly issued shares of common stock, par value $0.001 per share, of the Company, or the Common Stock, and warrants, or the Common Warrants, to purchase up to 14,000,000 shares of the Common Stock, each with an exercise price per share of $2.50, collectively the Private Placement. The Common Warrants will be exercisable immediately and will have a five-year term. Each share of Common Stock and Common Warrant, or together, the Common Unit, will be issued and sold together to Innoviva at a price per Common Unit of $2.50. Under the Securities Purchase Agreement, the Private Placement occurs in two tranches. At the closing of the first tranche, or the First Closing, which occurred on April 22, 2020, Innoviva purchased 1,322,510 shares of the Common Stock and the Common Warrants to purchase 1,322,510 shares of the Common Stock, for an aggregate purchase price of approximately $3.3 million. At the closing of the second tranche, or the Second Closing, subject to satisfaction of certain closing conditions, including the Company’s stockholders’ voting in favor of the transaction, Innoviva will purchase the remaining shares of the Common Stock and Common Warrants, which is anticipated to be 12,677,490 shares of the Common Stock and the Common Warrants to purchase 12,677,490 shares of the Common Stock for an aggregate purchase price of approximately $31.7 million. The Company expects to receive aggregate gross proceeds from the Private Placement of $35.0 million, before deducting transaction expenses, and excluding proceeds (if any) received in connection with the exercise of any of the Common Warrants. At the effective time of the Second Closing, assuming the exercise of all of the Common Warrants, Innoviva will hold approximately 67.8% of the Company’s outstanding common stock. The Securities Purchase Agreement contains customary representations and warranties as well as certain operating covenants applicable to the Company until the Second Closing. The Securities Purchase Agreement contains certain customary termination rights for both the Company and Innoviva, including, but not limited to, mutual written consent of the parties; by either party, if a governmental entity of competent jurisdiction issues a final and non-appealable order; and by either party, upon the breach of any representation, warranty, covenant or other agreement of the Securities Purchase Agreement by the other that is not cured before the earlier of the 10th day following notice of such breach and the termination date. If the Second Closing does not occur under specified circumstances, the Company will be required to pay Innoviva a termination fee in an amount equal to $850,000, plus reimbursement of expenses, which are capped at $250,000. The Second Closing is expected to close in the second quarter of 2020, subject to the satisfaction of certain closing conditions referenced above. To date, the Company has incurred $0.2 million in financing costs in connection with the Securities Purchase Agreement. Investor Rights Agreement At the First Closing, Innoviva and the Company entered into an investors rights agreement, or the Investor Rights Agreement, which provides that for so long as Innoviva and its affiliates hold at least 15% of the outstanding shares of the Common Stock on a fully-diluted basis, Innoviva shall have the right to designate two directors to the board of directors of the Company, or the Board; and for so long as Innoviva and its affiliates hold at least 8% of the outstanding shares of the Common Stock on a fully-diluted basis, Innoviva shall have the right to designate one director to the Board, subject to certain qualifications and conditions in the Investor Rights Agreement. The Investor Rights Agreement also provides for participation rights for Innoviva to participate pro rata in future offerings of securities by the Company. Registration Rights Agreements At the First Closing, the Company and Innoviva entered into a registration rights agreement, or the Registration Rights Agreement, pursuant to which, among other things, the Company must prepare and file with the SEC a registration statement with respect to resales of the shares of the Common Stock and the Common Warrants purchased by Innoviva under the Securities Purchase Agreement within 30 days of the First Closing.

Summary of Significant Accounting Policies (Policies)	3 Months Ended
Summary of Significant Accounting Policies (Policies)	Mar. 31, 2020
Summary of Significant Accounting Policies
Basis of Presentation and Consolidation	Basis of Presentation and Consolidation The accompanying consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP, and pursuant to the instructions to Form 10-Q and Article 10 of Regulation S-X. The December 31, 2019 consolidated balance sheet was derived from audited consolidated financial statements. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements, which are contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the Securities and Exchange Commission, or SEC, on March 11, 2020. The interim consolidated financial statements have been prepared on the same basis as the annual audited consolidated financial statements and, in the opinion of management, reflect all normal and recurring adjustments necessary for a fair statement of the Company’s financial position and results of operations. The accompanying consolidated financial statements include the Company’s accounts and those of the Company’s wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The results for the three months ended March 31, 2020 are not necessarily indicative of the results to be expected for the year ending December 31, 2020, any other interim periods, or any future year or period.
Use of Estimates	Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the recognition of revenue, and the recognition of certain development costs. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from the Company’s estimates.
Recently Adopted Accounting Pronouncements	Recently Adopted Accounting Pronouncements Effective January 1, 2020, the Company adopted the requirements under the FASB ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, which eliminates, adds and modifies certain disclosure requirements for fair value measurements. The adoption of the new guidance did not affect the Company’s consolidated financial statements. Effective January 1, 2020, the Company adopted the provisions of FASB ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606. This update clarifies the interaction between Topic 808, Collaborative Arrangements, and Topic 606, Revenue from Contracts with Customers. The guidance is required to be applied retrospectively to the date of initial application of Topic 606 and entities should recognize the cumulative effect of initially applying the amendments as an adjustment to the opening balance of retained earnings of the later of the earliest annual period presented and the annual period that includes the date of the entity’s initial application of Topic 606. The adoption of the new guidance did not affect the Company’s consolidated financial statements and did not require an adjustment to the opening balance of retained earnings. Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, or ASU 2019-12. The amendments in ASU 2019-12 are effective for fiscal years beginning after December 15, 2020, including interim periods therein. Early adoption of the standard is permitted. The Company does not anticipate that the adoption of ASU 2019-12 will have a material effect on the Company’s consolidated financial statements.

Short-Term Investments (Tables)

3 Months Ended

Mar. 31, 2020

Short-Term Investments.

Summary of amortized cost and estimated fair value of Company’s marketable securities


	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(in thousands)
Balance as of March 31, 2020:
U.S. Treasury securities	$	9,991	$	25	$	—	$	10,016
Total	$	9,991	$	25	$	—	$	10,016


	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(in thousands)
Balance as of December 31, 2019:
U.S. Treasury securities	$	24,957	$	5	$	—	$	24,962
Total	$	24,957	$	5	$	—	$	24,962

Fair Value of Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2020

Fair Value of Financial Instruments

Schedule of assets that were accounted for at fair value on recurring basis


	March 31, 2020
	Fair Value Measurement Using
	Level 1		Level 2		Level 3		Total
	(in thousands)
Cash equivalents:
Money market funds	$	9,038	$	—	$	—	$	9,038
Short-term investments:
U.S. Treasury securities		10,016		—		—		10,016
Total	$	19,054	$	—	$	—	$	19,054


	December 31, 2019
	Fair Value Measurement Using
	Level 1		Level 2		Level 3		Total
	(in thousands)
Cash equivalents:
Money market funds	$	13,949	$	—	$	—	$	13,949
Short-term investments:
U.S. Treasury securities		24,962		—		—		24,962
Total	$	38,911	$	—	$	—	$	38,911

Leases (Tables)

3 Months Ended

Mar. 31, 2020

Leases

Schedule of operating lease balance sheet information

The following table summarizes the presentation of the Company’s operating leases in its consolidated balance sheets (in thousands):


	As of		As of
	March 31, 2020		December 31, 2019
Assets
Operating lease right-of-use assets	$	1,505	$	1,620

Liabilities
Operating lease liabilities, current	$	544	$	506
Operating lease liabilities, net of current portion		1,173		1,321
Total operating lease liabilities	$	1,717	$	1,827

Schedule of future lease payments

Future minimum lease payments under non-cancelable leases as of March 31, 2020, were as detailed below (in thousands):


Fiscal Year	As of March 31, 2020
2020 (remaining 9 months)	$	508
2021		717
2022		737
2023		1
Total undiscounted lease payments		1,963
Less: imputed interest		(246)
Total operating lease liabilities	$	1,717

Accrued Expenses and Other Current Liabilities (Tables)

3 Months Ended

Mar. 31, 2020

Accrued Expenses and Other Current Liabilities.

Schedule of accrued expenses and other current liabilities

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


	March 31,		December 31,
	2020		2019
Accrued compensation and benefits	$	995	$	2,490
Accrued contract manufacturing		1,578		1,550
Accrued clinical		405		606
Accrued professional services		756		530
Accrued research		186		275
Current portion of operating lease liabilities		544		506
Other		169		295
Total accrued expenses and other current liabilities	$	4,633	$	6,252

Stockholders' Equity and Stock-Based Compensation Expense (Tables)

3 Months Ended

Mar. 31, 2020

Stockholders' Equity and Stock-Based Compensation Expense

Summary of Stock option activity under the 2015 and 2018 Plan


				Weighted-
		Weighted-		Average
		Average		Remaining	Aggregate
	Number of	Exercise		Contractual	Intrinsic
	Options	Price		Term (Years)	Value (in thousands)
Outstanding as of December 31, 2019	2,388,400	$	6.20	8.44	$	906
Granted	839,200		4.87
Exercised	—		—
Forfeited	(11,100)		5.01
Outstanding as of March 31, 2020	3,216,500	$	5.86	8.58	$	—

Exercisable as of March 31, 2020	1,110,613	$	5.66	7.50	$	—

Schedule of stock-based compensation expense

Stock‑based compensation expense was classified in the consolidated statement of operations as follows (in thousands):


	Three Months Ended March 31,
	2020		2019
Research and development	$	349	$	232
General and administrative		436		346
Total stock-based compensation expense	$	785	$	578

Organization and Description of Business (Details) $ / shares in Units, $ in Thousands		1 Months Ended
	Sep. 28, 2018 USD ($) $ / shares shares	Apr. 30, 2020 USD ($)	Mar. 31, 2020 USD ($) subsidiary	Dec. 31, 2019 USD ($)
Number of subsidiaries \| subsidiary			4
Going Concern
Cash, cash equivalents and short-term investments			$ 27,500
Accumulated deficit			$ (149,225)	$ (133,959)
Aggregate gross proceeds of securities purchase agreement		$ 35,000
Initial Public Offering
Shares issued (in shares) \| shares	5,000,000
Share price (in dollars per share) \| $ / shares	$ 15.00
Proceeds from initial public offering, net of issuance costs paid in the period	$ 65,600
Preferred stock including accrued dividends, converted into common stock \| shares	8,084,414

Short-Term Investments (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Table summarizes the amortized cost and estimated fair value of the Company’s marketable securities
Amortized Cost	$ 9,991	$ 24,957
Unrealized Gains	25	5
Fair Value	10,016	24,962
U.S. Treasury securities
Table summarizes the amortized cost and estimated fair value of the Company’s marketable securities
Amortized Cost	9,991	24,957
Unrealized Gains	25	5
Fair Value	$ 10,016	$ 24,962

Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Company’s assets that were accounted for at fair value on a recurring basis
Short-term investments	$ 10,016	$ 24,962
Recurring
Company’s assets that were accounted for at fair value on a recurring basis
Total	19,054	38,911
Recurring \| Level 1
Company’s assets that were accounted for at fair value on a recurring basis
Total	19,054	38,911
Recurring \| Money market funds
Company’s assets that were accounted for at fair value on a recurring basis
Cash equivalents	9,038	13,949
Recurring \| Money market funds \| Level 1
Company’s assets that were accounted for at fair value on a recurring basis
Cash equivalents	9,038	13,949
Recurring \| U.S. Treasury securities
Company’s assets that were accounted for at fair value on a recurring basis
Short-term investments	10,016	24,962
Recurring \| U.S. Treasury securities \| Level 1
Company’s assets that were accounted for at fair value on a recurring basis
Short-term investments	$ 10,016	$ 24,962

Leases - Lease Commitments (Details) $ in Millions		3 Months Ended
Leases - Lease Commitments (Details) $ in Millions	Jan. 01, 2019 ft² item	Mar. 31, 2020 USD ($)	Mar. 31, 2019 USD ($)
Leases
Lease, Practical Expedients, Package	true
Lease, Practical Expedient, Use of Hindsight	false
Number of other non-significant operating leases	2
Lessee, Operating Lease, Existence of Option to Extend	true
Renewal term	3 years
Waltham, Massachusetts lease
Leases
Number of significant operating leases	1
Significant operating lease space \| ft²	20,062
Operating lease expense \| $		$ 0.2	$ 0.2

Leases - Lease Balance Sheet (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Leases
Operating lease right-of-use assets	$ 1,505	$ 1,620
Operating lease liabilities, current	$ 544	506
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Accrued Expenses And Other Current Liabilities
Operating lease liabilities, net of current portion	$ 1,173	1,321
Total operating lease liabilities	$ 1,717	$ 1,827