0001558370-23-008815 | 10-Q | XBRL Viewer | Olema Pharmaceuticals INC

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Property and Equipment, net (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 2,061	$ 2,061
Less: Accumulated depreciation	(681)	(581)
Property and equipment, net	1,380	1,480
Lab equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	2,002	2,002
Computer equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 59	$ 59

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Condensed Consolidated Statements of Comprehensive Loss
Net loss	$ (28,286)	$ (23,030)
Other comprehensive gain (loss):
Net unrealized gain (loss) on marketable securities	835	(1,477)
Total comprehensive loss	$ (27,451)	$ (24,507)

- Definition

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

+ References

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+ Details

Leases - Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Leases
Operating cash flows from operating leases	$ 326	$ 315

Other Current Liabilities (Tables)

3 Months Ended

Mar. 31, 2023

Other Current Liabilities

Schedule of other current liabilities


	March 31,		December 31,
	2023		2022
Accrued research and development related costs	$	12,080	$	9,105
Accrued payroll related costs		2,741		296
Accrued professional fees		1,758		1,091
Accrued employee bonuses		1,082		4,518
Accrued taxes		109		68
Early exercise of unvested stock options		51		82
Total	$	17,821	$	15,160

Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2023

Stock-Based Compensation

Schedule of fair value assumptions


	March 31,		March 31,
	2023		2022
Risk-free interest rate		3.48%		1.69%
Expected term (in years)		6.08		6.06
Expected volatility		87.22%		79.17%
Expected dividend yield		—		—

Schedule of stock option activity


				Weighted
		Weighted		Average
		Average		Remaining
	Number of	Exercise		Contractual	Aggregate
	Shares	Price		Term	Intrinsic Value
				(in years)	(in thousands)
Outstanding as of December 31, 2022	8,384,858	$	8.59	8.30	$	262
Granted	1,989,728		4.79	—		—
Exercised(1)	(101,905)		2.47	—		—
Forfeited	(436,837)		3.71	—		—
Outstanding as of March 31, 2023(2)	9,835,844	$	8.10	8.27	$	2,029

Options vested and exercisable as of March 31, 2023	4,105,812	$	9.70	7.46	$	1,117
Options expected to vest as of March 31, 2023	5,730,032	$	6.96	8.86	$	912

(1)	Exercised amount includes vesting of early exercised options.

(2)	Balance as of March 31, 2023 includes 11,650 unvested early exercised stock options.

Summary of restricted stock activity


	Number of Shares	Grant Date Fair Value
Unvested restricted stock as of December 31, 2022	295,911	$	2.40
Granted	—		—
Vested	(49,318)		2.40
Forfeited	—		—
Unvested restricted stock as of March 31, 2023	246,593	$	2.40

Schedule of stock-based compensation expense


	Three Months Ended March 31,
	2023		2022
Research and development	$	3,088	$	3,067
General and administrative		1,542		1,898
Total	$	4,630	$	4,965

Other Current Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Other Current Liabilities
Accrued research and development related costs	$ 12,080	$ 9,105
Accrued payroll related costs	2,741	296
Accrued professional fees	1,758	1,091
Accrued employee bonuses	1,082	4,518
Accrued taxes	109	68
Early exercise of unvested stock options	51	82
Total	$ 17,821	$ 15,160

Stock-Based Compensation - Early Exercise of Stock Options (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Stock-Based Compensation
Proceeds from exercise of stock options	$ 220	$ 33
Exercise of stock options (in shares)	101,905
Current liability from early exercises of stock options	$ 100

Stock-Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Number of shares
Outstanding as at beginning of period (in shares)	8,384,858
Granted (in shares)	1,989,728
Exercised (in shares)	(101,905)
Forfeited (in shares)	(436,837)
Outstanding as at end of period (in shares)	9,835,844	8,384,858
Options vested and exercisable as at end of period (in shares)	4,105,812
Options expected to vest as at end of period (in shares)	5,730,032
Weighted Average Exercise Price
Outstanding as at beginning of period (in dollars per share)	$ 8.59
Granted (in dollars per share)	4.79
Exercised (in dollars per share)	2.47
Forfeited (in dollars per share)	3.71
Outstanding at end of period (in dollars per share)	8.10	$ 8.59
Options vested and exercisable as at end of period (in dollars per share)	9.70
Options expected to vest as at end of period (in dollars per share)	$ 6.96
Weighted Average Remaining Contractual Life
Weighted average remaining contractual life of outstanding options (in years)	8 years 3 months 7 days	8 years 3 months 18 days
Weighted average remaining contractual life of vested and exercisable options (in years)	7 years 5 months 15 days
Weighted average remaining contractual life of expected to vest options (in years)	8 years 10 months 9 days
Intrinsic value of outstanding options	$ 2,029	$ 262
Intrinsic value of vested and exercisable options	1,117
Intrinsic value of expected to vest options	$ 912
Unvested early exercised stock options	11,650

Nature of the Business and Basis of Presentation (Details) $ in Millions	3 Months Ended
	Mar. 31, 2023 USD ($) segment
Nature of the Business and Basis of Presentation
Number of operating segments	1
Number of reportable segments	1
Cash, cash equivalents and marketable securities \| $	$ 186.0

Leases - Lease Term and Discount Rate (Details)	Mar. 31, 2023	Mar. 31, 2022
Leases
Weighted-average remaining lease term (years)	2 years 6 months 25 days	3 years 5 months 15 days
Weighted-average discount rate	8.70%	8.65%

Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Prepaid Expenses and Other Current Assets
Prepaid insurance	$ 1,254	$ 1,738
Reimbursable research and development costs from a collaboration partner	976	1,387
Prepaid clinical development costs	439	506
Prepaid subscriptions and licenses	400	399
Interest receivable	302	319
Other	72	129
Total	$ 3,443	$ 4,478

Leases (Details) $ in Thousands	1 Months Ended
Leases (Details) $ in Thousands	Apr. 30, 2022 USD ($)	Mar. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Dec. 15, 2020 USD ($) ft²	Dec. 01, 2020 USD ($) ft²	Aug. 27, 2020 USD ($) ft²	Jun. 01, 2013 ft² item
Lease
Operating lease right-of-use assets		$ 2,220	$ 2,495
Lease liabilities		$ 2,291
MandalMed Services Agreement Area
Lease
Number of lease amendments \| item							6
Area of property \| ft²							5,762
Mandalmed Services Agreement Additional Area
Lease
Area of property \| ft²					2,130
Term of contract					3 years
Security Deposit					$ 100
Office Space
Lease
Area of property \| ft²						3,500
Term of contract						2 years
Renewal term	1 year
Renewal option	true
Security Deposit						$ 100
Operating lease right-of-use assets	$ 300
Lease liabilities	$ 300
Laboratory Lease Agreement
Lease
Area of property \| ft²				9,800
Term of contract				5 years
Security Deposit				$ 400

Stock-Based Compensation - 2020 Employee Stock Purchase Plan (Details) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2023 USD ($) shares	Mar. 31, 2022 USD ($)	Dec. 31, 2022	Dec. 31, 2020 item
Stock-Based Compensation
Percent of common stock at fair market value to be exercised			100.00%
Stock-based compensation expense	$ 4,630	$ 4,965
Employee stock purchase plan contingently issuable
Stock-Based Compensation
Percentage of eligible earnings withheld				15.00%
Percent of common stock at fair market value to be exercised				85.00%
Number of months for each purchase period				6 months
Number of purchase periods \| item				2
Common stock reserved for issuance \| shares	430,416
Stock-based compensation expense	$ 100	$ 100
Employee stock purchase plan contingently issuable \| Maximum
Stock-Based Compensation
Offering period				27 months

Fair Value Measurement (Tables)

3 Months Ended

Mar. 31, 2023

Fair Value Measurement

Schedule of financial assets and liabilities measured at fair value on a recurring basis


		March 31, 2023
(in thousands)	Level 1		Level 2		Level 3		Total
Financial Assets
Cash	$	6,688	$	—	$	—	$	6,688
Money market funds		31,284		—		—		31,284
Commercial paper		—		76,463		—		76,463
U.S. government treasury bills		57,697		—		—		57,697
Government-sponsored enterprise securities		—		13,876		—		13,876
Total	$	95,669	$	90,339	$	—	$	186,008

Schedule of financial assets reconciliation


	March 31, 2023
			Gross		Gross
	Amortized		Unrealized		Unrealized		Estimated
(in thousands)	Cost		Gains		Losses		Fair Value
Financial Assets
Cash and cash equivalents	$	40,970	$	1	$	—	$	40,971
Short-term marketable securities (<12 months to maturity)		146,016		4		(983)		145,037
Total	$	186,986	$	5	$	(983)	$	186,008

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 40,918	$ 23,702
Marketable securities	145,036	180,719
Prepaid expenses and other current assets	3,443	4,478
Total current assets	189,397	208,899
Property and equipment, net	1,380	1,480
Operating lease right-of-use assets	2,220	2,495
Other assets	2,771	2,771
Total assets	195,768	215,645
Current liabilities:
Accounts payable	681	374
Operating lease liabilities, current	908	1,015
Other current liabilities	17,821	15,160
Total current liabilities	19,410	16,549
Operating lease liabilities, net of current portion	1,383	1,550
Total liabilities	20,793	18,099
Commitments and contingencies (Note 10)
Stockholders' equity:
Preferred stock, $0.0001 par value; 10,000,000 shares authorized as of March 31, 2023 and December 31, 2022; no shares issued and outstanding as of March 31, 2023 and December 31, 2022.
Common stock, $0.0001 par value; 490,000,000 shares authorized as of March 31, 2023 and December 31, 2022; 40,696,563 and 40,601,648 shares issued as of March 31, 2023 and December 31, 2022, respectively; 40,438,320 and 40,287,097 shares outstanding as of March 31, 2023 and December 31, 2022, respectively.	3	3
Additional paid-in capital	413,213	408,333
Accumulated other comprehensive loss	(978)	(1,813)
Accumulated deficit	(237,263)	(208,977)
Total stockholders' equity	174,975	197,546
Total liabilities and stockholders' equity	$ 195,768	$ 215,645

Fair Value Measurement - Marketable Securities (Details)	Mar. 31, 2023 USD ($) security
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]
Amortized Cost	$ 186,986,000
Gross Unrealized Gains	5,000
Gross Unrealized Losses	(983,000)
Estimated Fair Value	186,008,000
Allowance for losses on available-for-sale debt securities	$ 0
Marketable securities in an unrealized loss position for more than 12 months \| security	23
Security in continuous unrealized loss position, more than 12 months, accumulated Loss	$ 800,000
Security in continuous unrealized loss position, more than 12 months, fair value	63,700,000
Cash and cash equivalents
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]
Amortized Cost	40,970,000
Gross Unrealized Gains	1,000
Estimated Fair Value	40,971,000
Short-term marketable securities
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]
Amortized Cost	146,016,000
Gross Unrealized Gains	4,000
Gross Unrealized Losses	(983,000)
Estimated Fair Value	$ 145,037,000

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive (Loss) Gain	Accumulated Deficit	Total
Balances, at Beginning of period at Dec. 31, 2021	$ 3	$ 388,904	$ (149)	$ (104,190)	$ 284,568
Balances, at Beginning of period (in shares) at Dec. 31, 2021	39,797,263
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Vesting of early exercised stock options		31			31
Vesting of early exercised stock options (in shares)	6,989
Vesting of restricted stock awards (in shares)	49,318
Exercise of stock options		33			33
Exercise of stock options (in shares)	15,755
Stock-based compensation expense		4,874			4,874
Employee stock purchase plan expense		91			91
Net unrealized gain (loss) on marketable securities			(1,477)		(1,477)
Net loss				(23,030)	(23,030)
Balances, at End of period at Mar. 31, 2022	$ 3	393,933	(1,626)	(127,220)	265,090
Balances, at End of period (in shares) at Mar. 31, 2022	39,869,325
Balances, at Beginning of period at Dec. 31, 2022	$ 3	408,333	(1,813)	(208,977)	197,546
Balances, at Beginning of period (in shares) at Dec. 31, 2022	40,287,097
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Vesting of early exercised stock options		30			$ 30
Vesting of early exercised stock options (in shares)	6,990
Vesting of restricted stock awards (in shares)	49,318				49,318
Exercise of stock options		220			$ 220
Exercise of stock options (in shares)	94,915				101,905
Stock-based compensation expense		4,515			$ 4,515
Employee stock purchase plan expense		115			115
Net unrealized gain (loss) on marketable securities			835		835
Net loss				(28,286)	(28,286)
Balances, at End of period at Mar. 31, 2023	$ 3	$ 413,213	$ (978)	$ (237,263)	$ 174,975
Balances, at End of period (in shares) at Mar. 31, 2023	40,438,320

Fair Value Measurement

3 Months Ended

Mar. 31, 2023

Fair Value Measurement

Fair Value Measurement

3.	Fair Value Measurement

The Company assesses the fair value of financial instruments based on the provisions of ASC 820, Fair Value Measurements. ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

●	Level 1 — Inputs are unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date.

●

Level 2 — Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

●	Level 3 — Unobservable inputs that are supported by little or no market activity that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.


		March 31, 2023
(in thousands)	Level 1		Level 2		Level 3		Total
Financial Assets
Cash	$	6,688	$	—	$	—	$	6,688
Money market funds		31,284		—		—		31,284
Commercial paper		—		76,463		—		76,463
U.S. government treasury bills		57,697		—		—		57,697
Government-sponsored enterprise securities		—		13,876		—		13,876
Total	$	95,669	$	90,339	$	—	$	186,008


	March 31, 2023
			Gross		Gross
	Amortized		Unrealized		Unrealized		Estimated
(in thousands)	Cost		Gains		Losses		Fair Value
Financial Assets
Cash and cash equivalents	$	40,970	$	1	$	—	$	40,971
Short-term marketable securities (<12 months to maturity)		146,016		4		(983)		145,037
Total	$	186,986	$	5	$	(983)	$	186,008

The Company considers its marketable securities with maturities beyond one year as current assets, based on their highly liquid nature and because such marketable securities represent the investment of cash that is available for current operations. The Company considers its investment portfolio of marketable securities to be available-for-sale. As of March 31, 2023, the Company does not have any marketable securities with maturities beyond one year.

The Company periodically reviews its available-for-sale marketable securities for other-than-temporary impairment. The Company considers factors such as the duration, severity and the reason for the decline in value, the potential recovery period and its intent to sell. For debt securities, the Company also considers whether (i) it is more likely than not that the Company will be required to sell the debt securities before recovery of their amortized cost basis, and (ii) the amortized cost basis cannot be recovered as a result of credit losses.

There were 23 marketable securities that have been in a consecutive loss position for more than 12 months as of March 31, 2023. They had $0.8 million unrealized loss with a fair value of $63.7 million as of March 31, 2023. The Company does not believe that the total unrealized losses of $1.0 million as of March 31, 2023 are credit-related but are rather a reflection of current market yields and/or current marketplace bid/ask spreads. During the three months ended March 31, 2023 and 2022, respectively, the Company did not recognize any other-than-temporary impairment loss. As of March 31, 2023, there was no allowance for losses on available-for-sale debt securities attributable to credit risk.

As of March 31, 2023, all of the Company’s cash and cash equivalents consisted of cash on deposit with U.S. banks denominated in U.S. dollars and Australian dollars.

- 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 - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Stock-based compensation expense
Total stock-based compensation expense	$ 4,630	$ 4,965
Research and development
Stock-based compensation expense
Total stock-based compensation expense	3,088	3,067
General and administrative
Stock-based compensation expense
Total stock-based compensation expense	$ 1,542	$ 1,898

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2023	May 05, 2023
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2023
Entity File Number	001-39712
Entity Registrant Name	OLEMA PHARMACEUTICALS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	30-0409740
Entity Address, Address Line One	512 2nd Street, 4th Floor
Entity Address, City or Town	San Francisco
Entity Address, Country	CA
Entity Address, Postal Zip Code	94107
City Area Code	650
Local Phone Number	243-5555
Title of 12(b) Security	Common Stock
Trading Symbol	OLMA
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		40,761,714
Entity Central Index Key	0001750284
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Amendment Flag	false

Leases

3 Months Ended

Mar. 31, 2023

Leases

Leases

Lease

The Company leases certain of its facilities under non-cancellable operating leases expiring at various dates through 2026.

On June 1, 2013, the Company entered into a management services agreement with MandalMed, Inc. (“MandalMed”) (the “MandalMed Services Agreement”) to have access to and use a portion of approximately

5,762 square feet of space for the use of laboratory benches, lab equipment, office space, and administrative and facilities services. The Company subsequently entered into six amendments to extend the agreement term to November 2023. As part of the sixth amendment, the Company gained access to use additional space of approximately 2,130 square feet (the “Additional Space”) for a three year period commencing on December 1, 2020 and ending on November 30, 2023. According to the terms of the MandalMed Services Agreement, the Company paid a security deposit of less than $0.1 million and is required to pay monthly rent and common area charges.

On August 27, 2020, the Company entered into a lease agreement with 512 2nd Street LLC to lease approximately 3,500 square feet of office space in San Francisco, California (the “Office Space Lease Agreement”). The Office Space Lease Agreement is for a period of two years commencing on September 1, 2020 and ending August 31, 2022. In April 2022, the Company extended the Office Space Lease Agreement up to August 31, 2023 and has one year renewal option to extend the term up to August 31, 2024. According to the terms of the Office Space Lease Agreement, the Company paid a $0.1 million security deposit and is required to pay monthly rent and common area charges. The extension of the lease term was accounted for as a modification under Topic 842 and the Company recorded additional ROU asset and lease liability of $0.3 million and $0.3 million, respectively, in the condensed consolidated financial statements.

On December 15, 2020, the Company entered into a lease agreement with Tennieh LLC to lease approximately 9,800 square feet of office space in San Francisco, California (the “Laboratory Lease Agreement”). The Laboratory Lease Agreement is for a period of five years commencing approximately February 1, 2021 and ending January 31, 2026. According to the terms of the Laboratory Lease Agreement, the Company paid a $0.4 million security deposit and is required to pay monthly rent and common area charges.

The following table summarizes total lease expense during the three months ended March 31, 2023 and 2022, respectively (in thousands):


		Three Months Ended March 31
		2023		2022
Straight-line operating lease expense	$	327	$	322
Short-term lease expense		53		60
Variable lease expense		10		10
Total operating lease expense	$	390	$	392

The following table summarizes supplemental cash flow information during the three months ended March 31, 2023 and 2022, respectively (in thousands):


		Three Months Ended March 31
		2023		2022
Cash paid for amounts included measurement of lease liabilities:
Operating cash flows from operating leases	$	326	$	315

The following table summarizes the Company’s future minimum lease payments and reconciliation of lease liabilities as of March 31, 2023 (in thousands):


Years Ended December 31,
2023 (from April 2023)	$	860
2024		799
2025		822
2026		69
Total future minimum lease payments		2,550
Less: Interest		(259)
Total lease liabilities at present value		2,291
Lease liabilities, current		908
Lease liabilities, non-current	$	1,383

The following table summarizes lease term and discount rate as of March 31, 2023:


	Three Months Ended March 31
	2023	2022
Weighted-average remaining lease term (years)	2.57	3.46
Weighted-average discount rate	8.70%	8.65%

Commitments and Contingencies

3 Months Ended

Mar. 31, 2023

Commitments and Contingencies.

Commitments and Contingencies

10.	Commitments and Contingencies

Clinical Collaboration and Supply Agreement

On July 22, 2020, the Company entered into a non-exclusive clinical collaboration and supply agreement with Novartis Institutes for BioMedical Research, Inc. (“Novartis”) and on January 13, 2022, the Company entered into the amended and restated clinical collaboration and supply agreement with Novartis (as amended and restated, the “Novartis Agreement”). The collaboration is focused on the evaluation of the safety, tolerability and efficacy of OP-1250 in combination with Novartis’ proprietary CDK4/6 inhibitor Kisqali® (ribociclib) and/or Novartis’ proprietary phosphatidylinositol 3-kinase (“PI3Ka”) Inhibitor Piqray® (alpelisib) (collectively the “Novartis Study Drugs”) as part of the Company’s planned Phase 1b clinical study of OP-1250 in patients with metastatic estrogen receptor-positive breast cancer. The Company will be responsible for the conduct of the clinical trials for the combined therapies in accordance with a mutually agreed development plan. As part of the collaboration, the parties granted to each other a non-exclusive, royalty- free license under certain of the parties’ respective background patent rights and other technology to use the parties’ respective study drugs in research and development, solely to the extent reasonably needed for the other party’s activities in the collaboration. All inventions and data developed in the performance of the clinical trials for the combined therapies (other than those specific to each component study drug), will be jointly owned by the parties.

The Company is responsible for manufacturing, packaging and labeling OP-1250, and for packaging and labeling all drugs used in the clinical trials for the combined therapies (other than the Novartis Study Drugs). Novartis is responsible for manufacturing and delivering to the Company the Novartis Study Drugs in such quantities as reasonably needed for the clinical trials for the combined therapies. In accordance with an agreed budget, subject to certain thresholds, Novartis will reimburse the Company for a majority of the direct outside costs that the Company incurs related to conducting the activities under the agreed development plan in conducting the clinical trials for the combined therapies.

The Novartis Agreement will terminate upon completion of all activities outlined in the development plan and the relevant protocols. Either party may terminate the Novartis Agreement for the uncured material breach or insolvency of the other party, if it reasonably deems it necessary in order to protect the safety, health or welfare of subjects enrolled in the clinical trials for the combined therapies due to the existence of a material safety issue, or in certain circumstances for an unresolved clinical hold with respect to either the Novartis Study Drugs

or OP-1250. In addition, Novartis may terminate the Novartis Agreement if certain disputes between the parties are not resolved after following the applicable dispute resolution procedures, and the Company may terminate the Novartis Agreement in the event the Company terminates all clinical trials of the combined therapies other than due to a material safety issue or upon a clinical hold.

Costs associated with research activities performed under the agreement are included in research and development expenses in the accompanying condensed consolidated financial statements, with any reimbursable costs from Novartis reflected as a reduction of such expenses. For the three months ended March 31, 2023 and 2022, costs reimbursable from Novartis were $0.5 million and $0 million, respectively. As of March 31, 2023, the receivable due from Novartis was $1.0 million, which is recorded under prepaid expenses and other current assets in the accompanying condensed consolidated financial statements.

Clinical Trial Agreement

In November 2020, the Company entered into a non-exclusive clinical trial agreement with Pfizer Inc. (“Pfizer”) (the “Pfizer Agreement”), to evaluate the safety and tolerability of OP-1250 in combination with Pfizer’s proprietary CDK4/6 inhibitor IBRANCE® (palbociclib) in patients with recurrent, locally advanced or metastatic ER+, HER2 breast cancer in a clinical trial. Under the terms of the non-exclusive agreement, the Company will be responsible for conducting the clinical trial for the combined therapies and Pfizer is responsible for supplying IBRANCE® to the Company at no cost to the Company. As part of the collaboration, the parties granted to each other a non-exclusive, royalty-free license under certain of the parties’ respective patent rights in the combination of IBRANCE® and OP-1250 to use the parties’ respective study drugs in research and development, solely to the extent reasonably needed for the other party’s activities in the collaboration. All inventions and data developed in the performance of the clinical trials for the combined therapies (other than those specific to each component study drug), will be jointly owned by the parties.

The Pfizer Agreement will terminate upon completion of all activities outlined in the study plan and the relevant protocols. Either party may terminate the Pfizer Agreement for the uncured material breach or insolvency of the other party, if it reasonably deems it necessary in order to protect the safety, health or welfare of subjects enrolled in the clinical trials for the combined therapies due to the existence of a material safety issue, or in certain circumstances for an unresolved clinical hold with respect to either the IBRANCE® (palbociclib) or OP-1250. In addition, either party may terminate the Pfizer Agreement if certain disputes between the parties are not resolved after following the applicable dispute resolution procedures or if either party determines to discontinue clinical development for medical, scientific, legal or other reasons.

The Pfizer Agreement does not grant any right of first negotiation to participate in future clinical trials, and each of the parties retains all rights and ability to evaluate their respective compounds. Costs incurred in connection to the Pfizer Agreement are included in the research and development expense in the accompanying condensed consolidated statements of operations and comprehensive loss for the three months ended March 31, 2023, and 2022.

License Agreement

In June 2022, the Company entered into an exclusive global license agreement with Aurigene Discovery Technologies Limited (“Aurigene”) to research, develop and commercialize novel small molecule inhibitors of an undisclosed oncology target (“the Aurigene Agreement”).

Under the terms of the Aurigene Agreement, Aurigene will provide to the Company an exclusive license to its portfolio of novel small molecule inhibitors of the target. Financial terms of the Aurigene Agreement include a

$8.0 million upfront payment for rights to a pre-existing Aurigene program and potential future milestone payments of up to $60.0 million in clinical development and regulatory milestones, and up to $370.0 million in commercial milestones. Aurigene is also eligible to receive mid-single digits to the low double digits royalties on product sales, if any. During the research term, the Company will contribute funding to Aurigene to facilitate Aurigene’s ongoing discovery efforts. The Company and Aurigene will jointly direct further preclinical work and, if successful, the Company will lead clinical development as well as regulatory and commercial activities. The Company and Aurigene jointly own collaboration compounds and rights to any inventions made during the research term.

The term of the Aurigene Agreement will continue until the expiration of the last-to-expire of all payment obligations with respect to all licensed products thereunder, unless terminated earlier in accordance with the terms of the Aurigene Agreement. The Aurigene Agreement may be terminated (a) by the Company for convenience, in its sole discretion, upon prior written notice to Aurigene, (b) by either the Company or Aurigene in connection with the other party’s uncured material breach or (c) by either the Company or Aurigene in connection with the insolvency of the other party.

The $8.0 million upfront payment was incurred in June 2022 and recorded as research and development expense in the accompanying condensed consolidated statements of operations and comprehensive loss. Costs incurred and milestones payments due to Aurigene prior to regulatory approval are recognized as research and development expenses in the period incurred. Payments due to Aurigene upon or subsequent to regulatory approval will be accrued as a provision to cost of sales in the period when achievement of respective milestone target is probable. As of March 31, 2023, it was determined that it is not probable to achieve any of the milestone target, and therefore, the Company recorded zero expense related to the milestone for the three months ended March 31, 2023.

Management Services Agreements

The Company conducts research and development programs internally and through third parties that include, among others, arrangements with vendors, consultants, CMOs, and CROs. The Company has contractual arrangements in the normal course of business with these parties, however, the contracts with these parties are cancelable generally on reasonable notice within one year and the Company’s obligations under these contracts are primarily based on services performed through termination dates plus certain cancelation charges, if any, as defined in each of the respective agreements. In addition, these agreements may, from time to time, be subjected to amendments as a result of any change orders executed by the parties. As of March 31, 2023, the Company did not have material contractual commitments with respect to these arrangements.

Contingencies

From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business. The Company accrues a liability for such matters when it is probable that future expenditures will be made, and such expenditures can be reasonably estimated. For all periods presented, the Company was not a party to any pending material litigation or other material legal proceedings.

Indemnification Agreements

In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with members of its Board of Directors and executive officers that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. As of March 31, 2023 and December 31, 2022, the Company had not incurred any material costs as a result of such indemnifications.

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2023	Dec. 31, 2022
Condensed Consolidated Balance Sheets
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, authorized (in shares)	10,000,000	10,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, authorized (in shares)	490,000,000	490,000,000
Common stock, issued (in shares)	40,696,563	40,601,648
Common stock, outstanding (in shares)	40,438,320	40,287,097

Prepaid Expenses and Other Current Assets

3 Months Ended

Mar. 31, 2023

Prepaid Expenses and Other Current Assets

Prepaid Expenses and Other Current Assets

5.	Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):


	March 31,		December 31,
	2023		2022
Prepaid insurance	$	1,254	$	1,738
Reimbursable research and development costs from a collaboration partner		976		1,387
Prepaid clinical development costs		439		506
Prepaid subscriptions and licenses		400		399
Interest receivable		302		319
Other		72		129
Total	$	3,443	$	4,478

Net Loss Per Share

3 Months Ended

Mar. 31, 2023

Net Loss Per Share

Net Loss Per Share

8.	Net Loss Per Share

Net Loss Per Share

Basic and diluted net loss per share was calculated as follows (in thousands, except share and per share amounts):


	Three Months Ended March 31,
	2023		2022
Numerator:
Net loss	$	(28,286)	$	(23,030)
Denominator:
Weighted average shares used to compute net loss per share attributable to common stockholders, basic and diluted		40,354,493		39,834,619
Net loss per share attributable to common stockholders, basic and diluted	$	(0.70)	$	(0.58)

The potentially dilutive shares that were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented are as follows:


	Three Months Ended March 31,
	2023	2022
Unvested restricted common stock	246,593	443,867
Unvested performance-based restricted stock unit awards outstanding	710,000	—
Options to purchase common stock	9,835,844	8,368,353
Employee stock purchase plan contingently issuable	247,993	110,877
	11,040,430	8,923,097

Included in the potentially dilutive options to purchase common stock are 11,650 unvested stock options that were early exercised by an employee and a non-employee in September 2020 (see Note 7, “Stock-Based Compensation”). The Company determined the early exercises to be non-substantive as the shares were subject to repurchase rights. Accordingly, the Company has excluded these shares from the calculation of basic and diluted net loss per share for the three months ended March 31, 2023 and 2022.

Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Future minimum lease payments
2023 (from April 2023)	$ 860
2024	799
2025	822
2026	69
Total future minimum lease payments	2,550
Less: Interest	(259)
Total lease liabilities at present value	2,291
Lease liabilities, current	908	$ 1,015
Lease liabilities, non-current	$ 1,383	$ 1,550

Stock Based Compensation - Performance-Based Restricted Stock Unit Awards (Details) - USD ($)	1 Months Ended	3 Months Ended
	Nov. 30, 2022	Mar. 31, 2023	Mar. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense		$ 4,630,000	$ 4,965,000
Unvested performance-based restricted stock units \| 2020 Plan \| Share-based Payment Arrangement, Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)	710,000
Stock-based compensation expense		$ 0
Unvested performance-based restricted stock units \| 2020 Plan \| Share-based Payment Arrangement, Employee \| Share-Based Payment Arrangement, Tranche One
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting Percentage	65.00%
Unvested performance-based restricted stock units \| 2020 Plan \| Share-based Payment Arrangement, Employee \| Share-Based Payment Arrangement, Tranche Two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting Percentage	35.00%

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows from operating activities:
Net loss	$ (28,286)	$ (23,030)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense	100	84
Non-cash lease expense	327	323
Premium amortization and discount accretion on marketable securities, net	(869)	6
Stock-based compensation expense, including employee stock purchase plan expense	4,630	4,965
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	1,035	172
Other assets		(240)
Accounts payable	307	245
Other current liabilities	2,691	(113)
Operating lease liabilities	(326)	(315)
Net cash used in operating activities	(20,391)	(17,903)
Cash flows from investing activities:
Purchase of equipment		(30)
Maturities of marketable securities	61,760	148,750
Purchases of marketable securities	(24,373)	(123,153)
Net cash provided by investing activities	37,387	25,567
Cash flows from financing activities:
Proceeds from exercise of stock options	220	33
Net cash provided by financing activities	220	33
Net increase in cash and cash equivalents	17,216	7,697
Cash and cash equivalents at beginning of period	23,702	13,812
Cash and cash equivalents at end of period	$ 40,918	21,509
Supplemental disclosure of non-cash investing and financing activities:
Reclassification of prepaid expenses and other current liabilities into other assets		$ 2,014

Net Loss Per Share - Anti-dilutive Effect (Details) - shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities	11,040,430	8,923,097
Unvested early exercised stock options	11,650
Unvested restricted common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities	246,593	443,867
Unvested performance-based restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities	710,000
Options to purchase common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities	9,835,844	8,368,353
Employee stock purchase plan contingently issuable
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities	247,993	110,877

Stock-Based Compensation

3 Months Ended

Mar. 31, 2023

Stock-Based Compensation

Stock-Based Compensation

7. Stock-Based Compensation

In 2014, the Company’s Board of Directors and stockholders approved and adopted the Company’s 2014 Stock Plan (the “2014 Plan”). The 2014 Plan permitted the grant of options and restricted stock awards (including restricted stock purchase rights and restricted stock bonus awards). The 2014 Plan was terminated on the date the Company’s 2020 Equity Incentive Plan (the “2020 Plan”), which is described below, became effective, and since that date, no additional awards have been or will be made pursuant to the 2014 Plan. However, any outstanding awards granted under the 2014 Plan will remain outstanding, subject to the terms of the 2014 Plan award agreements, until such outstanding options are exercised or until any awards terminate or expire by their terms.

In 2020, the Company’s Board of Directors and stockholders approved and adopted the 2020 Equity Incentive Plan (the “2020 Plan”). The 2020 Plan permits the grant of options, restricted stock awards, stock appreciation rights, restricted stock unit awards, performance awards, and other awards. The maximum number of shares of common stock that may be issued under the 2020 Plan will not exceed 6,494,510 shares of the Company’s common stock, which is the sum of (i) 2,152,080 new shares, plus (ii) an additional number of shares not to exceed 4,342,430 shares, consisting of any shares of the Company’s common stock subject to outstanding stock options or other stock awards granted under the Company’s 2014 Plan that, on or after the 2020 Plan becomes effective, terminate or expire prior to exercise or settlement; are not issued because the award is settled in cash; are forfeited because of the failure to vest; or are reacquired or withheld (or not issued) to satisfy a tax withholding obligation or the purchase or exercise price. In addition, the number of shares of the Company’s common stock reserved for issuance under the 2020 Plan automatically increases on January 1 of each year for a period of ten years, beginning on January 1, 2021 and continuing through January 1, 2030, in an amount equal to the lesser of (1) 5% of the total number of shares of the Company’s common stock outstanding on December 31 of the immediately preceding year, or (2) a lesser number of shares determined by the Company’s Board of Directors no later than December 31 of the immediately preceding year.

In 2022, the Company’s Board of Directors approved and adopted the 2022 Inducement Plan (the “2022 Inducement Plan”). Under the 2022 Inducement Plan, initially 2,000,000 shares of common stock were reserved for issuance. The 2022 Inducement Plan permits the grant of options, restricted stock awards, stock appreciation rights, restricted stock unit awards, performance awards, and other awards.

The exercise price for each option and stock appreciation right shall be established at the discretion of the Board, provided that the exercise price of a stock option will not be less than 100% of the fair market value of the Company’s common stock on the date of grant. Specific vesting for stock options and stock appreciation rights is service related and determined in each award agreement, where stock options and stock appreciation rights are fully vested at the grant date or follow a graded vesting schedule. Stock options and stock appreciation rights granted under the plans generally expire ten years after the date of grant.

Stock Option Valuation

The fair value of stock option grants is estimated using the Black-Scholes option-pricing model. The Company lacks company-specific historical and implied volatility information. Therefore, it estimated its expected stock volatility based on the historical volatility of a publicly traded set of peer companies in addition to its own historical volatility. For options with service-based vesting conditions, the expected term of the Company’s stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. The expected term of stock options granted to nonemployees is equal to the contractual term of the option award. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is 0% since the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future.

The assumptions that the Company used to determine the estimated grant-date fair value of stock options granted to employees and directors under the 2020 Plan and the 2022 Inducement Plan were as follows, presented as a weighted average:


	March 31,		March 31,
	2023		2022
Risk-free interest rate		3.48%		1.69%
Expected term (in years)		6.08		6.06
Expected volatility		87.22%		79.17%
Expected dividend yield		—		—

Stock Option Activity

The following table summarizes the stock option activity under the 2014 Plan, the 2020 Plan and the 2022 Inducement Plan:


				Weighted
		Weighted		Average
		Average		Remaining
	Number of	Exercise		Contractual	Aggregate
	Shares	Price		Term	Intrinsic Value
				(in years)	(in thousands)
Outstanding as of December 31, 2022	8,384,858	$	8.59	8.30	$	262
Granted	1,989,728		4.79	—		—
Exercised(1)	(101,905)		2.47	—		—
Forfeited	(436,837)		3.71	—		—
Outstanding as of March 31, 2023(2)	9,835,844	$	8.10	8.27	$	2,029

Options vested and exercisable as of March 31, 2023	4,105,812	$	9.70	7.46	$	1,117
Options expected to vest as of March 31, 2023	5,730,032	$	6.96	8.86	$	912

(1)	Exercised amount includes vesting of early exercised options.

(2)	Balance as of March 31, 2023 includes 11,650 unvested early exercised stock options.

Early Exercise of Stock Options

The terms of the 2014 Plan permit certain option holders to exercise options before their options are vested, subject to certain limitations. The early exercised options are subject to the same vesting provisions in the original stock option awards. Shares issued as a result of early exercise that have not vested are subject to repurchase by the Company upon termination of the purchaser’s employment, at the price paid by the purchaser. Such shares are not deemed to be outstanding for accounting purposes until they vest and are therefore excluded from shares outstanding and from basic and diluted net loss per share until the repurchase right lapses and the shares are no longer subject to the repurchase feature. A liability is recognized related to the cash proceeds of the unvested options and is reclassified into common stock and additional paid-in capital as the shares vest and the repurchase right lapses. Accordingly, the Company has recorded the unvested portion of the exercise proceeds of $0.1 million in other current liabilities as of March 31, 2023.

Restricted Stock Awards

The following table summarizes the restricted stock activity under the 2014 Plan during the three months ended March 31, 2023:


	Number of Shares	Grant Date Fair Value
Unvested restricted stock as of December 31, 2022	295,911	$	2.40
Granted	—		—
Vested	(49,318)		2.40
Forfeited	—		—
Unvested restricted stock as of March 31, 2023	246,593	$	2.40

Performance-Based Restricted Stock Unit Awards

In November 2022, the Company granted to certain employees 710,000 shares of performance-based restricted stock unit awards (the “PSUs”) under the 2020 Plan as consideration for services subject to performance conditions with a fair value based on the closing price of the underlying common stock on the date of grant. Pursuant to the terms of the PSUs, 65% of each PSU vests upon certification by the Compensation Committee of the Company of achieving a pre-determined performance goal by June 30, 2024, and 35% of each PSU vests upon certification by the Compensation Committee of the Company of achieving a pre-determined performance goal by June 30, 2024.

Expense recognition for PSUs commences when it is determined that attainment of the performance goal is probable or met. As of March 31, 2023, it was determined that the performance goals were not yet met, and therefore, the Company recorded zero stock-based compensation expense related to the PSUs for the three months ended March 31, 2023.

2020 Employee Stock Purchase Plan

In 2020, the Company’s Board of Directors and stockholders approved and adopted the ESPP. The ESPP permits eligible employees who elect to participate in an offering under the ESPP to have up to 15% of their eligible earnings withheld, subject to certain limitations, to purchase shares of common stock pursuant to the ESPP. The price of the common stock purchased under the ESPP is equal to the lesser of (i) 85% of the fair market value of a share of the Company’s common stock on the first day of an offering; or (ii) 85% of the fair market value of a share of the Company’s common stock on the date of purchase. Each offering period is not to exceed 27 months and will include one or more purchase periods (each a “Purchase Period”) as approved by the Company’s Board of Directors in the offering. The current offering period will consist of two (2) six-month Purchase Periods during which payroll deductions of the participants are accumulated under the ESPP. A total of 430,416 shares of common stock were initially reserved for issuance pursuant to the ESPP.

The ESPP is a compensatory plan as defined by the authoritative guidance for stock-based compensation. The Company uses the Black-Scholes option-pricing model to estimate the fair value of stock offered under the ESPP. Stock-based compensation expense related to the ESPP was $0.1 million and $0.1 million for the three months ended March 31, 2023 and 2022, respectively.

Stock-Based Compensation Expense

Stock-based compensation expense related to awards granted under the 2014 Plan, the 2020 Plan, the ESPP and the 2022 Inducement Plan was classified in the condensed consolidated statements of operations and comprehensive loss as follows (in thousands):


	Three Months Ended March 31,
	2023		2022
Research and development	$	3,088	$	3,067
General and administrative		1,542		1,898
Total	$	4,630	$	4,965

Fair Value Measurement (Details) - Recurring $ in Thousands	Mar. 31, 2023 USD ($)
Assets
Cash	$ 6,688
Total	186,008
Level 1
Assets
Cash	6,688
Total	95,669
Level 2
Assets
Total	90,339
Money market funds
Assets
Cash	31,284
Money market funds \| Level 1
Assets
Cash	31,284
Commercial paper
Assets
Marketable securities	76,463
Commercial paper \| Level 2
Assets
Marketable securities	76,463
U.S. Government treasury bills
Assets
Marketable securities	57,697
U.S. Government treasury bills \| Level 1
Assets
Marketable securities	57,697
Government-sponsored enterprise securities
Assets
Marketable securities	13,876
Government-sponsored enterprise securities \| Level 2
Assets
Marketable securities	$ 13,876

Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Numerator:
Net loss	$ (28,286)	$ (23,030)
Denominator:
Weighted average shares used to compute net loss per share, basic	40,354,493	39,834,619
Weighted average shares used to compute net loss per share, diluted	40,354,493	39,834,619
Net loss per share attributable to common stockholders, basic	$ (0.70)	$ (0.58)
Net loss per share attributable to common stockholders, diluted	$ (0.69)	$ (0.58)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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

+ References

+ Details

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Operating expenses:
Research and development	$ 22,826	$ 16,009
General and administrative	6,776	7,245
Total operating expenses	29,602	23,254
Loss from operations	(29,602)	(23,254)
Other income:
Interest income	1,305	218
Other income	11	6
Total other income	1,316	224
Net loss attributable to common stockholders	$ (28,286)	$ (23,030)
Net loss per share attributable to common stockholders, basic	$ (0.70)	$ (0.58)
Net loss per share attributable to common stockholders, diluted	$ (0.69)	$ (0.58)
Weighted average shares used to compute net loss per share, basic	40,354,493	39,834,619
Weighted average shares used to compute net loss per share, diluted	40,354,493	39,834,619

Net Loss Per Share (Tables)

3 Months Ended

Mar. 31, 2023

Net Loss Per Share

Schedule of basic and diluted net loss per share

Basic and diluted net loss per share was calculated as follows (in thousands, except share and per share amounts):


	Three Months Ended March 31,
	2023		2022
Numerator:
Net loss	$	(28,286)	$	(23,030)
Denominator:
Weighted average shares used to compute net loss per share attributable to common stockholders, basic and diluted		40,354,493		39,834,619
Net loss per share attributable to common stockholders, basic and diluted	$	(0.70)	$	(0.58)

Schedule of anti-dilutive securities excluded from computation of diluted loss per share


	Three Months Ended March 31,
	2023	2022
Unvested restricted common stock	246,593	443,867
Unvested performance-based restricted stock unit awards outstanding	710,000	—
Options to purchase common stock	9,835,844	8,368,353
Employee stock purchase plan contingently issuable	247,993	110,877
	11,040,430	8,923,097

Property and Equipment, net

3 Months Ended

Mar. 31, 2023

Property and Equipment, net

Property and Equipment, net

4. Property and Equipment, net

Property and equipment, net consisted of the following (in thousands):


	March 31,		December 31,
	2023		2022
Lab equipment	$	2,002	$	2,002
Computer equipment		59		59
Property and equipment, gross		2,061		2,061
Less: Accumulated depreciation		(681)		(581)
Property and equipment, net	$	1,380	$	1,480

Property and Equipment, net (Tables)

3 Months Ended

Mar. 31, 2023

Property and Equipment, net

Schedule of property and equipment, net


	March 31,		December 31,
	2023		2022
Lab equipment	$	2,002	$	2,002
Computer equipment		59		59
Property and equipment, gross		2,061		2,061
Less: Accumulated depreciation		(681)		(581)
Property and equipment, net	$	1,380	$	1,480

Other Current Liabilities

3 Months Ended

Mar. 31, 2023

Other Current Liabilities

Other Current Liabilities

6.	Other Current Liabilities

Other current liabilities consisted of the following (in thousands):


	March 31,		December 31,
	2023		2022
Accrued research and development related costs	$	12,080	$	9,105
Accrued payroll related costs		2,741		296
Accrued professional fees		1,758		1,091
Accrued employee bonuses		1,082		4,518
Accrued taxes		109		68
Early exercise of unvested stock options		51		82
Total	$	17,821	$	15,160

Stock-Based Compensation - Stock Option Valuation (Details)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Stock-Based Compensation
Risk-free interest rate	3.48%	1.69%
Expected term (in years)	6 years 29 days	6 years 21 days
Expected volatility	87.22%	79.17%
Expected dividend yield	0.00%	0.00%

Nature of the Business and Basis of Presentation

3 Months Ended

Mar. 31, 2023

Nature of the Business and Basis of Presentation

Nature of the Business and Basis of Presentation

1.	Nature of the Business and Basis of Presentation

Olema Pharmaceuticals, Inc. (“Olema” or the “Company”) is a clinical-stage biopharmaceutical company focused on the discovery, development and commercialization of next-generation targeted therapies for women’s cancers. The Company is initially focused on developing therapies for the treatment of breast cancer. The Company’s wholly-owned, lead product candidate, OP-1250, is a novel oral therapy with combined activity as both a complete estrogen receptor (“ER”) antagonist (“CERAN”) and a selective ER degrader (“SERD”). It is currently being evaluated as a single agent in an ongoing Phase 1/2 clinical study, and in Phase 1b/2 clinical studies in combination with palbociclib, ribociclib, and alpelisib, in patients with recurrent, locally advanced or metastatic estrogen receptor-positive (“ER+”), human epidermal growth factor receptor 2 negative (“HER2-”) breast cancer.

The Company is located in San Francisco, California and was incorporated in Delaware on August 7, 2006 under the legal name of CombiThera, Inc. and on March 25, 2009 was renamed Olema Pharmaceuticals, Inc. The Company’s principal operations are based in San Francisco, California, and has operations in Cambridge, Massachusetts. Olema Oncology Australia Pty Ltd was incorporated on January 6, 2021 and is a wholly-owned subsidiary of the Company (collectively with Olema Pharmaceuticals, Inc. referred to as “Olema” or the “Company” herein). It operates in one business segment and therefore has only one reportable segment. The Company is subject to risks and uncertainties common to early-stage companies in the biopharmaceutical industry, including, but not limited to, successful discovery and development of its product candidates, development by competitors of new technological innovations, dependence on key personnel, the ability to attract and retain qualified employees, protection of proprietary technology, compliance with governmental regulations, the impact of geopolitical and macroeconomic events, such as the COVID-19 pandemic, ongoing conflict between Ukraine and Russia and related sanctions, recent and potential future bank failures and financial instability, the ability to secure additional capital to fund operations and commercial success of its product candidates. OP-1250 and any future product candidates the Company may develop will require extensive nonclinical and clinical testing and regulatory approval prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel, and infrastructure and extensive compliance-reporting capabilities. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales.

Liquidity

The Company had $186.0 million of cash, cash equivalents and marketable securities at March 31, 2023, which management believes is sufficient to fund its operating expenses and capital expenditure requirements into 2025.

Impact of Geopolitical and Macroeconomic Events

Global economic and business activities continue to face widespread geopolitical and macroeconomic uncertainties, including labor shortages, inflation and monetary supply shifts, bank failures and related financial market risks and instability, recession risks, as well as potential disruptions from the Russia-Ukraine conflict, which has resulted in volatility in the U.S. and global financial markets and which has led to, and may continue to lead to, additional disruptions to trade, commerce, pricing stability, credit availability and supply chain continuity globally. The extent of the impact of these factors on the Company’s operational and financial performance, including its ability to execute its business strategies and initiatives in the expected time frame, will depend on future developments, which are uncertain and cannot be predicted. Any continued or renewed disruption resulting from these factors could negatively impact the Company’s business. The Company

continues to monitor the impact of these geopolitical and macroeconomic factors on its results of operations, financial condition and cash flows.

Stock-Based Compensation (Details) - shares	12 Months Ended
Stock-Based Compensation (Details) - shares	Dec. 31, 2022	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percent of common stock at fair market value to be exercised	100.00%
Expiration period (in years)	10 years
2020 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
New shares authorized		2,152,080
Period of increase in common stock reserved for issuance		10 years
Percentage of increase in common stock reserved for issuance		5.00%
2020 Plan \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized		6,494,510
Shares available from prior equity incentive plan		4,342,430
2022 Inducement Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for issuance	2,000,000

Prepaid Expenses and Other Current Assets (Tables)

3 Months Ended

Mar. 31, 2023

Prepaid Expenses and Other Current Assets

Schedule of prepaid expenses and other current assets


	March 31,		December 31,
	2023		2022
Prepaid insurance	$	1,254	$	1,738
Reimbursable research and development costs from a collaboration partner		976		1,387
Prepaid clinical development costs		439		506
Prepaid subscriptions and licenses		400		399
Interest receivable		302		319
Other		72		129
Total	$	3,443	$	4,478

Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2023

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2.	Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting, and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These condensed consolidated financial statements include the accounts of Olema Pharmaceuticals, Inc. and its wholly-owned subsidiary, Olema Oncology Australia Pty Ltd. All intercompany balances and transactions have been eliminated upon consolidation.

Unaudited Interim Financial Information

The interim condensed consolidated balance sheet as of March 31, 2023, and the statements of operations and comprehensive loss, stockholders’ equity and cash flows for the three months ended March 31, 2023 and 2022 are unaudited. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and reflect, in the opinion of management, all adjustments of a normal and recurring nature that are necessary for the fair presentation of the Company’s condensed consolidated financial statements included in this report. The financial data and the other information disclosed in these notes to the condensed consolidated financial statements related to the three-month periods are also unaudited. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any other future annual or interim period. The condensed consolidated balance sheet as of December 31, 2022 included herein was derived from the audited financial statements as of that date. These interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in the Company’s Form 10-K as filed with the SEC on March 9, 2023 (the “Annual Report”).

Use of Estimates

The accompanying condensed consolidated financial statements are prepared in accordance with GAAP. The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and reported amounts of expenses during the reporting period. Significant areas that require management’s estimates include accruals of research and development expenses, including accrual of research contract costs, stock-based compensation assumptions, including the fair value of common stock. On an ongoing basis, the Company evaluates its estimates and judgments, which are based on historical and anticipated results and trends and on various other assumptions that management believes to be reasonable under the circumstances. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents are defined as short-term, highly liquid investments with original maturities of 90 days or less at the date of purchase. Cash deposits are all in reputable financial institutions in the United States as of March 31, 2023 and December 31, 2022. Cash and cash equivalents consisted of cash on deposit with U.S. banks, including the Company’s bank account for its Australia subsidiary, denominated in U.S. dollars and Australian dollars and investments in interest bearing money market funds.

Marketable Securities

All marketable securities have been classified as “available-for-sale” and are carried at estimated fair value as determined based upon quoted market prices or pricing models for similar securities. Management determines the appropriate classification of its investments at the time of purchase and reevaluates such designation as of each balance sheet date. Unrealized gains and losses are excluded from net loss and are reported as a component of comprehensive loss. Realized gains and losses and declines in fair value judged to be other than temporary, if any, on available-for-sale securities are included in interest income. The cost of securities sold is based on the specific-identification method. Interest earned on marketable securities is included in interest income.

The Company periodically assesses its available-for-sale marketable securities for other-than-temporary impairment. For debt securities in an unrealized loss position, the Company first considers its intent to sell, or whether it is more likely than not that the Company will be required to sell the debt securities before recovery of their amortized cost basis. If either of these criteria are met, the amortized cost basis of such debt securities is written down to fair value through other expense.

For debt securities in an unrealized loss position that do not meet the aforementioned criteria, the Company assesses whether the decline in the fair value of such debt securities has resulted from credit losses or other factors. The Company considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and any adverse conditions specifically related to the securities, among other factors. If this assessment indicates that a credit loss may exist, the Company then compares the present value of cash flows expected to be collected from such securities to their amortized cost basis. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded through other expense, limited by the amount that the fair value is less than the amortized cost basis. Any additional impairment not recorded through an allowance for credit losses is recognized in other comprehensive loss. The Company has not recorded any impairments for its marketable securities.

Concentration of Credit Risk and Other Risks and Uncertainties

Financial instruments that potentially subject the Company to concentration of credit risk consist of cash, cash equivalents, and marketable securities. The Company invests in a variety of financial instruments and, by its policy, limits these financial instruments to high credit quality securities issued by the U.S. government, U.S. government-sponsored agencies and highly rated banks and corporations, subject to certain concentration limits. The Company’s cash, cash equivalents, and marketable securities are held by financial institutions in the United States that management believes are of high credit quality. Amounts on deposit with individual banking institutions may at times exceed the limits insured by the Federal Deposit Insurance Corporation (“FDIC”); however, the Company has not experienced any losses on such deposits.

The Company’s future results of operations involve a number of other risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, uncertainty of results of clinical trials and reaching milestones, uncertainty of regulatory approval of the Company’s current and potential future product candidates, uncertainty of market acceptance of the Company’s product candidates, competition from substitute products and larger companies, securing and protecting proprietary technology, strategic relationships, dependence on key individuals or sole-source suppliers, and geopolitical and macroeconomic factors.

The Company’s product candidates require approvals from the U.S. Food and Drug Administration (“FDA”) and comparable foreign regulatory agencies prior to commercial sales in their respective jurisdictions. There can be no assurance that any product candidates will receive the necessary approvals. If the Company were denied approval, approval was delayed or the Company was unable to maintain approval for any product candidate, it could have a materially adverse impact on the Company.

Leases

The Company adopted Accounting Standard Update (“ASU”) 2016-12, Leases, Topic 842, (“Topic 842”) as of January 1, 2021. Under Topic 842, lessees are required to recognize for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use (“ROU”) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the condensed consolidated statements of operations and comprehensive loss.

At the inception of an arrangement, the Company determines if an arrangement is, or contains, a lease based on the facts and circumstances present in that arrangement. Lease classification, recognition, and measurement are then determined at the lease commencement date. For arrangements that contain a lease, the Company (i) identifies lease and non-lease components, (ii) determines the consideration in the contract, (iii) determines whether the lease is an operating or finance lease; and (iv) recognizes lease ROU assets and liabilities. Lease liabilities and their corresponding ROU assets are recorded based on the present value of future lease payments over the expected lease term. The interest rate implicit in lease contracts is typically not readily determinable and as such, the Company uses the incremental borrowing rate based on the information available at the lease commencement date, which represents an internally developed rate that would be incurred to borrow, on a collateralized basis, over a similar term, an amount equal to the lease payments in a similar economic environment.

Most leases include options to renew and, or terminate the lease, which can impact the lease term. The exercise of these options is at the Company’s discretion. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. For any lease modification, the Company reassesses the lease classification, remeasures the related lease liability using an updated discount rate that reflects the modified lease term, and adjusts the related ROU asset under the lease modification guidance under Topic 842.

The Company has operating leases for its research and development and office facilities. Fixed lease payments on operating leases are recognized over the expected term of the lease on a straight-line basis. Variable lease expenses that are not considered fixed are recognized as incurred. Fixed and variable lease expense on operating leases is recognized within operating expenses within our condensed consolidated statements of operations and comprehensive loss.

The Company elected to not apply the recognition requirements of Topic 842 to short-term leases with terms of 12 months or less. Additional information and disclosures required by Topic 842 are contained in Note 11 “Lease” in the Annual Report.

Research and Development Costs

Research and development costs are expensed as incurred. Research and development expenses consist of costs incurred to discover, research and develop product candidates. These costs are recorded within research and development expenses in the condensed consolidated statements of operations and include personnel expenses, stock-based compensation expenses, allocated general and administrative expenses, and external costs including fees paid to consultants and CROs and contract manufacturing organizations (“CMOs”), in connection with nonclinical studies and clinical trials, and other related clinical trial fees, such as for investigator fees, patient screening, laboratory work, clinical trial database management, clinical trial material management

and statistical compilation and analysis. Non-refundable prepayments for goods or services that will be used or rendered for future research and development activities are recorded as prepaid expenses and other current assets. Such amounts are recognized as an expense as the goods are delivered or the related services are performed.

Costs incurred in obtaining technology licenses that do not meet the definition of a business are charged immediately to research and development expense if the technology licensed has not reached technological feasibility and has no alternative future uses.

Reimbursements of certain costs associated with research activities performed under the agreement with Novartis Institutes for BioMedical Research, Inc. (“Novartis”) are recorded as a reduction of research and development expenses and as a receivable due from Novartis, which is recorded under prepaid expenses and other current assets in the accompanying condensed consolidated financial statements, as described in Note 10, Commitments and Contingencies – Clinical Collaboration and Supply Agreement.

Research Contract Costs and Accruals

The Company has from time to time entered into various research and development and other agreements with commercial firms, researchers, universities and others for provisions of goods and services. These agreements are generally cancelable, and the related costs are recorded as research and development expenses as incurred.

The Company records accruals for estimated ongoing research and development costs. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the projects, studies or clinical trials, including the phase or completion of events, invoices received and contracted costs. Judgments and estimates are made in determining the accrued balances at the end of any reporting period. Actual results could differ materially from the Company’s estimates. The Company’s historical accrual estimates have not been materially different from the actual costs.

Net Loss Per Common Share

Basic net loss per common share is computed by dividing the net loss per common share by the weighted average number of common shares outstanding for the period without consideration of common stock equivalents. Diluted net loss per common share is computed by adjusting net loss to reallocate undistributed earnings based on the potential impact of dilutive securities, and by dividing the diluted net loss by the weighted average number of common shares outstanding for the period, including potential dilutive common shares. For purpose of this calculation, outstanding stock options, including unvested early exercised options, unvested restricted stock awards, unvested performance-based restricted stock unit awards, contingently issuable common stock related to the 2020 Employee Stock Purchase Plan (the “ESPP”) are considered potential dilutive common shares. Since the Company was in a loss position for all periods presented, basic net loss per share is the same as diluted net loss per share for all periods as the inclusion of all potential common shares outstanding would have been anti-dilutive.

Recent Accounting Pronouncements

There were no new accounting pronouncements that were relevant to the Company as of and for the three months ended March 31, 2023.

Commitments and Contingencies (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	Jun. 30, 2022	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Loss Contingencies [Line Items]
Reimbursable research and development costs from a collaboration partner		$ 976		$ 1,387
Research and development		22,826	$ 16,009
Novartis Agreement \| Bio Medical Research Inc
Loss Contingencies [Line Items]
Costs reimbursable from Novartis		500	$ 0
Reimbursable research and development costs from a collaboration partner		1,000
Aurigene Agreement
Loss Contingencies [Line Items]
Milestone payments to be paid to collaborative partner	$ 60,000
Upfront payment, research and development.	8,000
Research and development		$ 0
Aurigene Agreement \| Commercial Milestone
Loss Contingencies [Line Items]
Milestone payments to be paid to collaborative partner	$ 370,000

Summary of Significant Accounting Policies (Policies)	3 Months Ended
Summary of Significant Accounting Policies (Policies)	Mar. 31, 2023
Summary of Significant Accounting Policies
Basis of Presentation and Consolidation	Basis of Presentation and Consolidation The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting, and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These condensed consolidated financial statements include the accounts of Olema Pharmaceuticals, Inc. and its wholly-owned subsidiary, Olema Oncology Australia Pty Ltd. All intercompany balances and transactions have been eliminated upon consolidation.
Unaudited Interim Financial Information	Unaudited Interim Financial Information The interim condensed consolidated balance sheet as of March 31, 2023, and the statements of operations and comprehensive loss, stockholders’ equity and cash flows for the three months ended March 31, 2023 and 2022 are unaudited. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and reflect, in the opinion of management, all adjustments of a normal and recurring nature that are necessary for the fair presentation of the Company’s condensed consolidated financial statements included in this report. The financial data and the other information disclosed in these notes to the condensed consolidated financial statements related to the three-month periods are also unaudited. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any other future annual or interim period. The condensed consolidated balance sheet as of December 31, 2022 included herein was derived from the audited financial statements as of that date. These interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in the Company’s Form 10-K as filed with the SEC on March 9, 2023 (the “Annual Report”).
Use of Estimates	Use of Estimates The accompanying condensed consolidated financial statements are prepared in accordance with GAAP. The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and reported amounts of expenses during the reporting period. Significant areas that require management’s estimates include accruals of research and development expenses, including accrual of research contract costs, stock-based compensation assumptions, including the fair value of common stock. On an ongoing basis, the Company evaluates its estimates and judgments, which are based on historical and anticipated results and trends and on various other assumptions that management believes to be reasonable under the circumstances. Actual results could differ from those estimates.
Cash and Cash Equivalents	Cash and Cash Equivalents Cash and cash equivalents are defined as short-term, highly liquid investments with original maturities of 90 days or less at the date of purchase. Cash deposits are all in reputable financial institutions in the United States as of March 31, 2023 and December 31, 2022. Cash and cash equivalents consisted of cash on deposit with U.S. banks, including the Company’s bank account for its Australia subsidiary, denominated in U.S. dollars and Australian dollars and investments in interest bearing money market funds.
Marketable Securities	Marketable Securities All marketable securities have been classified as “available-for-sale” and are carried at estimated fair value as determined based upon quoted market prices or pricing models for similar securities. Management determines the appropriate classification of its investments at the time of purchase and reevaluates such designation as of each balance sheet date. Unrealized gains and losses are excluded from net loss and are reported as a component of comprehensive loss. Realized gains and losses and declines in fair value judged to be other than temporary, if any, on available-for-sale securities are included in interest income. The cost of securities sold is based on the specific-identification method. Interest earned on marketable securities is included in interest income. The Company periodically assesses its available-for-sale marketable securities for other-than-temporary impairment. For debt securities in an unrealized loss position, the Company first considers its intent to sell, or whether it is more likely than not that the Company will be required to sell the debt securities before recovery of their amortized cost basis. If either of these criteria are met, the amortized cost basis of such debt securities is written down to fair value through other expense. For debt securities in an unrealized loss position that do not meet the aforementioned criteria, the Company assesses whether the decline in the fair value of such debt securities has resulted from credit losses or other factors. The Company considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and any adverse conditions specifically related to the securities, among other factors. If this assessment indicates that a credit loss may exist, the Company then compares the present value of cash flows expected to be collected from such securities to their amortized cost basis. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded through other expense, limited by the amount that the fair value is less than the amortized cost basis. Any additional impairment not recorded through an allowance for credit losses is recognized in other comprehensive loss. The Company has not recorded any impairments for its marketable securities.
Concentration of Credit Risk and Other Risks and Uncertainties	Concentration of Credit Risk and Other Risks and Uncertainties Financial instruments that potentially subject the Company to concentration of credit risk consist of cash, cash equivalents, and marketable securities. The Company invests in a variety of financial instruments and, by its policy, limits these financial instruments to high credit quality securities issued by the U.S. government, U.S. government-sponsored agencies and highly rated banks and corporations, subject to certain concentration limits. The Company’s cash, cash equivalents, and marketable securities are held by financial institutions in the United States that management believes are of high credit quality. Amounts on deposit with individual banking institutions may at times exceed the limits insured by the Federal Deposit Insurance Corporation (“FDIC”); however, the Company has not experienced any losses on such deposits. The Company’s future results of operations involve a number of other risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, uncertainty of results of clinical trials and reaching milestones, uncertainty of regulatory approval of the Company’s current and potential future product candidates, uncertainty of market acceptance of the Company’s product candidates, competition from substitute products and larger companies, securing and protecting proprietary technology, strategic relationships, dependence on key individuals or sole-source suppliers, and geopolitical and macroeconomic factors. The Company’s product candidates require approvals from the U.S. Food and Drug Administration (“FDA”) and comparable foreign regulatory agencies prior to commercial sales in their respective jurisdictions. There can be no assurance that any product candidates will receive the necessary approvals. If the Company were denied approval, approval was delayed or the Company was unable to maintain approval for any product candidate, it could have a materially adverse impact on the Company.
Leases	Leases The Company adopted Accounting Standard Update (“ASU”) 2016-12, Leases, Topic 842, (“Topic 842”) as of January 1, 2021. Under Topic 842, lessees are required to recognize for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use (“ROU”) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the condensed consolidated statements of operations and comprehensive loss. At the inception of an arrangement, the Company determines if an arrangement is, or contains, a lease based on the facts and circumstances present in that arrangement. Lease classification, recognition, and measurement are then determined at the lease commencement date. For arrangements that contain a lease, the Company (i) identifies lease and non-lease components, (ii) determines the consideration in the contract, (iii) determines whether the lease is an operating or finance lease; and (iv) recognizes lease ROU assets and liabilities. Lease liabilities and their corresponding ROU assets are recorded based on the present value of future lease payments over the expected lease term. The interest rate implicit in lease contracts is typically not readily determinable and as such, the Company uses the incremental borrowing rate based on the information available at the lease commencement date, which represents an internally developed rate that would be incurred to borrow, on a collateralized basis, over a similar term, an amount equal to the lease payments in a similar economic environment. Most leases include options to renew and, or terminate the lease, which can impact the lease term. The exercise of these options is at the Company’s discretion. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. For any lease modification, the Company reassesses the lease classification, remeasures the related lease liability using an updated discount rate that reflects the modified lease term, and adjusts the related ROU asset under the lease modification guidance under Topic 842. The Company has operating leases for its research and development and office facilities. Fixed lease payments on operating leases are recognized over the expected term of the lease on a straight-line basis. Variable lease expenses that are not considered fixed are recognized as incurred. Fixed and variable lease expense on operating leases is recognized within operating expenses within our condensed consolidated statements of operations and comprehensive loss. The Company elected to not apply the recognition requirements of Topic 842 to short-term leases with terms of 12 months or less. Additional information and disclosures required by Topic 842 are contained in Note 11 “Lease” in the Annual Report.
Research and Development Costs	Research and Development Costs Research and development costs are expensed as incurred. Research and development expenses consist of costs incurred to discover, research and develop product candidates. These costs are recorded within research and development expenses in the condensed consolidated statements of operations and include personnel expenses, stock-based compensation expenses, allocated general and administrative expenses, and external costs including fees paid to consultants and CROs and contract manufacturing organizations (“CMOs”), in connection with nonclinical studies and clinical trials, and other related clinical trial fees, such as for investigator fees, patient screening, laboratory work, clinical trial database management, clinical trial material management and statistical compilation and analysis. Non-refundable prepayments for goods or services that will be used or rendered for future research and development activities are recorded as prepaid expenses and other current assets. Such amounts are recognized as an expense as the goods are delivered or the related services are performed. Costs incurred in obtaining technology licenses that do not meet the definition of a business are charged immediately to research and development expense if the technology licensed has not reached technological feasibility and has no alternative future uses. Reimbursements of certain costs associated with research activities performed under the agreement with Novartis Institutes for BioMedical Research, Inc. (“Novartis”) are recorded as a reduction of research and development expenses and as a receivable due from Novartis, which is recorded under prepaid expenses and other current assets in the accompanying condensed consolidated financial statements, as described in Note 10, Commitments and Contingencies – Clinical Collaboration and Supply Agreement.
Research Contract Costs and Accruals	Research Contract Costs and Accruals The Company has from time to time entered into various research and development and other agreements with commercial firms, researchers, universities and others for provisions of goods and services. These agreements are generally cancelable, and the related costs are recorded as research and development expenses as incurred. The Company records accruals for estimated ongoing research and development costs. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the projects, studies or clinical trials, including the phase or completion of events, invoices received and contracted costs. Judgments and estimates are made in determining the accrued balances at the end of any reporting period. Actual results could differ materially from the Company’s estimates. The Company’s historical accrual estimates have not been materially different from the actual costs.
Net Loss Per Common Share	Net Loss Per Common Share Basic net loss per common share is computed by dividing the net loss per common share by the weighted average number of common shares outstanding for the period without consideration of common stock equivalents. Diluted net loss per common share is computed by adjusting net loss to reallocate undistributed earnings based on the potential impact of dilutive securities, and by dividing the diluted net loss by the weighted average number of common shares outstanding for the period, including potential dilutive common shares. For purpose of this calculation, outstanding stock options, including unvested early exercised options, unvested restricted stock awards, unvested performance-based restricted stock unit awards, contingently issuable common stock related to the 2020 Employee Stock Purchase Plan (the “ESPP”) are considered potential dilutive common shares. Since the Company was in a loss position for all periods presented, basic net loss per share is the same as diluted net loss per share for all periods as the inclusion of all potential common shares outstanding would have been anti-dilutive.
Recent Accounting Pronouncements	Recent Accounting Pronouncements There were no new accounting pronouncements that were relevant to the Company as of and for the three months ended March 31, 2023.

Stock-Based Compensation - Restricted Stock Awards (Details)	3 Months Ended
	Mar. 31, 2023 $ / shares shares
Number of Shares
Unvested restricted stock as at beginning of period (in shares) \| shares	295,911
Vested (in shares) \| shares	(49,318)
Unvested restricted stock as at end of period (in shares) \| shares	246,593
Grant Date Fair Value
Unvested restricted stock as at beginning of period (in dollars per share) \| $ / shares	$ 2.40
Vested (in dollars per share) \| $ / shares	2.40
Unvested restricted stock as at ending of period (in dollars per share) \| $ / shares	$ 2.40

Leases (Tables)

3 Months Ended

Mar. 31, 2023

Leases

Summary of total lease expense


		Three Months Ended March 31
		2023		2022
Straight-line operating lease expense	$	327	$	322
Short-term lease expense		53		60
Variable lease expense		10		10
Total operating lease expense	$	390	$	392

Summary of supplemental cash flow information


		Three Months Ended March 31
		2023		2022
Cash paid for amounts included measurement of lease liabilities:
Operating cash flows from operating leases	$	326	$	315

Summary of future minimum lease payments


Years Ended December 31,
2023 (from April 2023)	$	860
2024		799
2025		822
2026		69
Total future minimum lease payments		2,550
Less: Interest		(259)
Total lease liabilities at present value		2,291
Lease liabilities, current		908
Lease liabilities, non-current	$	1,383

Summary of lease term and discount rate


	Three Months Ended March 31
	2023	2022
Weighted-average remaining lease term (years)	2.57	3.46
Weighted-average discount rate	8.70%	8.65%

Leases - Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended
Leases - Lease Expense (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Mar. 31, 2022
Lease expense
Straight-line operating lease expense	$ 327	$ 322
Short-term lease expense	53	60
Variable lease expense	10	10
Total operating lease expense	$ 390	$ 392