View Filing Data

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2019	Oct. 31, 2019
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Trading Symbol	ZFGN
Entity Registrant Name	ZAFGEN, INC.
Entity Central Index Key	0001374690
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Common Stock, Shares Outstanding		37,374,118
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity File Number	001-36510
Entity Tax Identification Number	20-3857670
Entity Address, Address Line One	3 Center Plaza
Entity Address, Address Line Two	Suite 610
Entity Address, City or Town	Boston
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02108
City Area Code	617
Local Phone Number	622-4003
Title of 12(b) Security	Common Stock
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes
Document Quarterly Report	true
Document Transition Report	false

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 43,337	$ 49,331
Marketable securities	38,669	68,735
Tax incentive receivable	235	1,536
Prepaid expenses and other current assets	1,202	1,728
Total current assets	83,443	121,330
Property and equipment, net	913	375
Operating lease right-of-use assets	7,172
Restricted cash	1,339
Other assets	20	57
Total assets	92,887	121,762
Current liabilities:
Accounts payable	3,319	3,590
Accrued expenses	1,719	4,261
Accrued restructuring costs	3,619
Operating lease liabilities, current	409
Notes payable, current	7,273	5,455
Total current liabilities	16,339	13,306
Notes payable, long-term	10,166	15,185
Operating lease liabilities	6,502
Total liabilities	33,007	28,491
Commitments and contingencies (Note 7)
Stockholders' equity:
Preferred stock; $0.001 par value per share; 5,000,000 shares authorized as of September 30, 2019 and December 31, 2018; no shares issued and outstanding as of September 30, 2019 and December 31, 2018
Common stock, $0.001 par value per share; 115,000,000 shares authorized as of September 30, 2019 and December 31, 2018; 37,370,301 and 37,287,221 shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively	37	37
Additional paid-in capital	448,902	444,212
Accumulated deficit	(389,100)	(350,945)
Accumulated other comprehensive income (loss)	41	(33)
Total stockholders' equity	59,880	93,271
Total liabilities and stockholders' equity	$ 92,887	$ 121,762

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Income Statement [Abstract]
Revenue	$ 0	$ 0	$ 0	$ 0
Operating expenses:
Research and development	5,260	11,830	23,463	36,472
General and administrative	3,627	3,339	10,891	9,959
Restructuring charges	4,019		4,019
Total operating expenses	12,906	15,169	38,373	46,431
Loss from operations	(12,906)	(15,169)	(38,373)	(46,431)
Other income (expense):
Interest income	451	623	1,654	1,214
Interest expense	(426)	(475)	(1,404)	(1,399)
Foreign currency transaction losses, net	(33)	(46)	(32)	(182)
Total other income (expense), net	(8)	102	218	(367)
Net loss	$ (12,914)	$ (15,067)	$ (38,155)	$ (46,798)
Net loss per share, basic and diluted	$ (0.35)	$ (0.41)	$ (1.02)	$ (1.53)
Weighted average common shares outstanding, basic and diluted	37,369,829	36,619,575	37,337,081	30,608,664
Comprehensive loss:
Net loss	$ (12,914)	$ (15,067)	$ (38,155)	$ (46,798)
Other comprehensive income:
Unrealized gain (loss) on marketable debt securities	11	(22)	74	30
Total other comprehensive income (loss)	11	(22)	74	30
Total comprehensive loss	$ (12,903)	$ (15,089)	$ (38,081)	$ (46,768)

Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Deficit [Member]	Accumulated Other Comprehensive Loss [Member]
Beginning balance at Dec. 31, 2017	$ 78,217	$ 27	$ 367,825	$ (289,577)	$ (58)
Beginning balance, shares at Dec. 31, 2017		27,489,457
Issuance of common stock upon exercise of stock options and employee stock purchase plan	261	$ 1	260
Issuance of common stock upon exercise of stock options and employee stock purchase plan, shares		63,893
Issuance of restricted stock units, shares		5,533
Stock-based compensation expense	2,466		2,466
Unrealized gain (loss) on marketable securities	9				9
Net loss	(15,956)			(15,956)
Ending balance at Mar. 31, 2018	64,997	$ 28	370,551	(305,533)	(49)
Ending balance, shares at Mar. 31, 2018		27,558,883
Beginning balance at Dec. 31, 2017	78,217	$ 27	367,825	(289,577)	(58)
Beginning balance, shares at Dec. 31, 2017		27,489,457
Net loss	(46,798)
Ending balance at Sep. 30, 2018	103,937	$ 37	440,303	(336,375)	(28)
Ending balance, shares at Sep. 30, 2018		36,865,817
Beginning balance at Mar. 31, 2018	64,997	$ 28	370,551	(305,533)	(49)
Beginning balance, shares at Mar. 31, 2018		27,558,883
Issuance of common stock upon exercise of stock options and employee stock purchase plan	86		86
Issuance of common stock upon exercise of stock options and employee stock purchase plan, shares		15,643
Issuance of restricted stock units, shares		4,463
Stock-based compensation expense	2,671		2,671
Unrealized gain (loss) on marketable securities	43				43
Net loss	(15,775)			(15,775)
Ending balance at Jun. 30, 2018	52,022	$ 28	373,308	(321,308)	(6)
Ending balance, shares at Jun. 30, 2018		27,578,989
Issuance of common stock, net of issuance costs	64,560	$ 9	64,551
Issuance of common stock, net of issuance costs, shares		9,200,000
Issuance of common stock upon exercise of stock options and employee stock purchase plan	244		244
Issuance of common stock upon exercise of stock options and employee stock purchase plan, shares		82,365
Issuance of restricted stock units, shares		4,463
Stock-based compensation expense	2,200		2,200
Unrealized gain (loss) on marketable securities	(22)				(22)
Net loss	(15,067)			(15,067)
Ending balance at Sep. 30, 2018	103,937	$ 37	440,303	(336,375)	(28)
Ending balance, shares at Sep. 30, 2018		36,865,817
Beginning balance at Dec. 31, 2018	93,271	$ 37	444,212	(350,945)	(33)
Beginning balance, shares at Dec. 31, 2018		37,287,221
Issuance of common stock upon exercise of stock options and employee stock purchase plan	95		95
Issuance of common stock upon exercise of stock options and employee stock purchase plan, shares		31,391
Issuance of restricted stock units, shares		4,467
Stock-based compensation expense	2,076		2,076
Unrealized gain (loss) on marketable securities	34				34
Net loss	(13,112)			(13,112)
Ending balance at Mar. 31, 2019	82,364	$ 37	446,383	(364,057)	1
Ending balance, shares at Mar. 31, 2019		37,323,079
Beginning balance at Dec. 31, 2018	93,271	$ 37	444,212	(350,945)	(33)
Beginning balance, shares at Dec. 31, 2018		37,287,221
Net loss	(38,155)
Ending balance at Sep. 30, 2019	59,880	$ 37	448,902	(389,100)	41
Ending balance, shares at Sep. 30, 2019		37,370,301
Beginning balance at Mar. 31, 2019	82,364	$ 37	446,383	(364,057)	1
Beginning balance, shares at Mar. 31, 2019		37,323,079
Issuance of restricted stock units, shares		3,816
Stock-based compensation expense	1,875		1,875
Unrealized gain (loss) on marketable securities	29				29
Net loss	(12,129)			(12,129)
Ending balance at Jun. 30, 2019	72,139	$ 37	448,258	(376,186)	30
Ending balance, shares at Jun. 30, 2019		37,326,895
Issuance of common stock upon exercise of stock options and employee stock purchase plan	40		40
Issuance of common stock upon exercise of stock options and employee stock purchase plan, shares		39,589
Issuance of restricted stock units, shares		3,817
Stock-based compensation expense	604		604
Unrealized gain (loss) on marketable securities	11				11
Net loss	(12,914)			(12,914)
Ending balance at Sep. 30, 2019	$ 59,880	$ 37	$ 448,902	$ (389,100)	$ 41
Ending balance, shares at Sep. 30, 2019		37,370,301

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Cash flows from operating activities:
Net loss	$ (38,155)	$ (46,798)
Adjustments to reconcile net loss to net cash used in operating activities
Stock-based compensation expense	4,555	7,337
Depreciation expense	185	209
Impairment of assets	80
Loss on disposal of property and equipment	6
Unrealized foreign currency transaction losses	13	45
Premium on marketable securities, net	(39)	(3)
Amortization of discount on marketable securities	(706)	(345)
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	526	(465)
Tax incentive receivable	1,288	(344)
Accounts payable	(556)	(397)
Accrued restructuring costs	3,619
Accrued expenses and other	(1,830)	1,108
Other assets	37
Net cash used in operating activities	(30,977)	(39,653)
Cash flows from investing activities:
Proceeds from sales and maturities of marketable securities	101,920	84,938
Purchases of marketable securities	(71,035)	(105,976)
Purchases of property and equipment	(479)	(96)
Proceeds from sales of property and equipment	3
Payments for leasehold improvements on right-of-use assets	(586)
Net cash provided by (used in) investing activities	29,823	(21,134)
Cash flows from financing activities:
Proceeds from public offering, net of issuance costs		64,560
Repayments of notes payable	(3,636)
Proceeds from exercise of common stock options and employee stock purchase plan	135	591
Net cash (used in) provided by financing activities	(3,501)	65,151
Net (decrease) increase in cash, cash equivalents and restricted cash	(4,655)	4,364
Cash, cash equivalents and restricted cash at beginning of period	49,331	40,777
Cash, cash equivalents and restricted cash at end of period	44,676	45,141
Supplemental disclosure of non-cash investing and financing activities:
Property and equipment included in accounts payable and accrued expenses	285	4
Supplemental disclosure of cash flow information:
Cash paid for interest	$ 969	$ 819

Nature of the Business and Basis of Presentation

9 Months Ended

Sep. 30, 2019

Accounting Policies [Abstract]

Nature of the Business and Basis of Presentation

1. Nature of the Business and Basis of Presentation

Zafgen, Inc., or the Company, was incorporated on November 22, 2005 under the laws of the State of Delaware. The Company is a biopharmaceutical company that has leveraged its proprietary knowledge of the methionine aminopeptidase 2 (“MetAP2”) pathway to pioneer the study of MetAP2 inhibitors in both common and rare metabolic disorders.

The Company’s prior lead product candidate, ZGN-1061, is a MetAP2 inhibitor that was in Phase 2 clinical development for the treatment of type 2 diabetes and other related metabolic disorders. In November 2018, the Company received a letter from the U.S. Food and Drug Administration (“FDA”) placing a full clinical hold on the investigational new drug application (“IND”) for the first U.S. clinical trial of ZGN-1061. The FDA cited the possibility of cardiovascular (“CV”) safety risk based on the Company’s prior compound. In July 2019, the Company reached agreement with the FDA on an in vivo animal study design and protocol to establish relevant safety margins for ZGN-1061. The study was designed to translate the data from the Company’s newly developed in vitro assays of human endothelial cells and assessment of tissue factor expression with endothelial cells, along with other supportive assays, as it worked toward resolving the full clinical hold. Based on the preliminary results from the in vivo study, on September 5, 2019, the Company announced that it believes there is a low probability of resolving the clinical hold in the near-term. Subsequently, all further development activities of MetAP2 inhibitors were halted and the Company withdrew the IND for ZGN-1061 in September 2019. Therefore, the Company has determined that it is in the best interest of shareholders to evaluate strategic alternatives. Potential strategic alternatives that may be evaluated include, but are not limited to, an acquisition, merger, business combination, in-licensing, or other strategic transaction involving the Company or its assets. There can be no assurance that the exploration of strategic alternatives will result in any transaction being entered into or consummated. In addition to evaluating strategic alternatives, in September 2019, the Company’s Board of Directors approved a restructuring plan to reduce operating costs and better align the Company’s workforce with its needs, which in combination with the July restructuring actions and other attrition in 2019, resulted in a 70% reduction in workforce and closure of its San Diego facility (See Note 10).

The Company was also co-sponsoring a four-year natural history study which was designed to advance understanding of the medical history of and medical events in people with Prader-Willi syndrome in collaboration with the Foundation for Prader-Willi Research (“FPWR”). In October 2019, the Company transferred the study sponsorship and all of the associated rights to the study data to FPWR.

The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, new technological innovations, protection of proprietary technology, dependence on key personnel, compliance with government regulations and the need to obtain additional financing. Future product candidates will require significant additional research and development efforts, including extensive nonclinical and clinical testing and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel infrastructure, and extensive compliance-reporting capabilities.

There can be no assurance that the Company’s future product candidates’ research and development, if any, will be successfully completed, that adequate protection for the Company’s intellectual property will be obtained, that any product candidates developed will obtain necessary government regulatory approval or that any approved products will be commercially viable. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will generate significant revenue from product sales. The Company operates in an environment of rapid change in technology and substantial competition from pharmaceutical and biotechnology companies. In addition, the Company is dependent upon the services of its employees and consultants.

The Company has incurred losses and negative cash flows from operations since its inception. As of September 30, 2019, the Company had an accumulated deficit of $389.1 million. From its inception through September 30, 2019, the Company received net proceeds of $397.9 million from the sales of redeemable convertible preferred stock, the issuance of convertible promissory notes, the proceeds from its initial public offering (“IPO”) in June 2014 and its follow-on offerings in January 2015 and July 2018. On July 2, 2018, the Company completed a public offering of its common stock, which resulted in the sale of 9,200,000 shares at a price of $7.50 per share, resulting in net proceeds of approximately $64.6 million after deducting underwriting discounts and commissions, as well as offering costs. As disclosed in Note 5 to the condensed consolidated financial statements, the Company has a term loan with an aggregate principal balance of $16.4 million as of September 30, 2019. The loan agreement requires that the Company maintain certain minimum liquidity at all times, which as of September 30, 2019, was approximately $17.2 million. If the minimum liquidity covenant is not met, the Company may be required to repay the loan prior to scheduled maturity dates. The Term Loan also includes events of default, the occurrence and continuation of any of which provides the lenders the right to exercise remedies against the Company and the collateral securing the amounts due under the Term Loan. These events of default include, among other things, failure to pay any amounts due under the Term Loan, insolvency, the occurrence of a material adverse event, the occurrence of any default under certain other indebtedness and a final judgment against the Company in an amount greater than $0.3 million. The Company has estimated that the risk of subjective acceleration under the material adverse events clause is reasonably possible, however not probable and therefore have classified the outstanding principal in current and long-term liabilities based on contractually scheduled principal payments. However, the assessment of such probability of the debt holder calling the debt is subjective and their actions and/or the Company’s related assessment could change in the future, which in turn would impact the classification of the debt balances. Until such time, if ever, as the Company can generate substantial product revenue, the Company expects to finance its cash needs through a combination of equity offerings, debt financings, collaborations, strategic alliances, licensing arrangements and other sources of funding.

On September 17, 2019, the Company received a deficiency letter from the Listing Qualifications Department of the Nasdaq Stock Market notifying it that, for the last 30 consecutive business days, the bid price for the Company’s common stock had closed below the minimum $1.00 per share requirement for continued inclusion on the Nasdaq Global Market, referred to as the minimum bid price rule. In accordance with Nasdaq Listing Rules, the Company has an initial period of 180 calendar days, or until March 16, 2020, to regain compliance with the minimum bid price rule. The Company is actively monitoring its stock price and will consider any and all options available to the Company to maintain compliance. The alternatives to trading on the Nasdaq Capital Market or another national securities exchange are generally considered to be less efficient and less broad-based than the national securities exchanges and the liquidity of the Company’s common stock will likely be reduced if we fail to regain compliance with the minimum bid price rule.

Based on its current operating plans, the Company believes its cash, cash equivalents and marketable securities of $82.0 million as of September 30, 2019 will be sufficient to fund its anticipated level of operations, capital expenditures and satisfy debt repayments for a period of at least 12 months from the issuance date of this Quarterly Report. The Company expects to generate operating losses for the foreseeable future. If the Company is unable to raise additional funds through equity or debt financings, the Company may be required to delay, limit, reduce or terminate future product development or future commercialization efforts or grant rights to develop and market products or product candidates that the Company would otherwise prefer to develop and market itself.

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Zafgen Securities Corporation, Zafgen Australia Pty Limited, and Zafgen Animal Health, LLC. All intercompany balances and transactions have been eliminated.

Unaudited Interim Financial Information

The condensed consolidated balance sheet as of December 31, 2018 was derived from the Company’s audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”). The accompanying unaudited condensed consolidated financial statements as of September 30, 2019 and for the three and nine months ended September 30, 2019 and 2018, have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, the Company believes that the disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2018, included in the Company’s Annual Report on Form 10-K, for the year ended December 31, 2018, on file with the SEC. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s condensed consolidated financial position as of September 30, 2019 and condensed consolidated results of operations and cash flows for the three and nine months ended September 30, 2019 and 2018 have been made. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2019.

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2019

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the condensed consolidated financial statements, and the reported amounts of expenses during the reporting periods. Significant estimates and assumptions reflected in these condensed consolidated financial statements include, but are not limited to, the accrual of research and development expenses and the valuation of stock-based awards. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Actual results could differ from the Company’s estimates.

Marketable securities

Marketable securities consist of investments with original maturities greater than ninety days. The Company has classified its investments with maturities beyond one year as short term, based on their highly liquid nature and because such marketable securities represent the investment of cash that is available for current operations. The Company classifies its marketable debt securities as available-for-sale. Accordingly, these investments are recorded at fair value, which is based on quoted market prices. Unrealized gains and losses are reported as a component of accumulated other comprehensive income (loss) in stockholders’ equity. Realized gains and losses and declines in value judged to be other than temporary are included as a component of other income (expense), net, based on the specific identification method. When determining whether a decline in value is other than temporary, the Company considers various factors, including whether the Company has the intent to sell the security, and whether it is more likely than not that the Company will be required to sell the security prior to recovery of its amortized cost basis. Fair value is determined based on quoted market prices.

Net Loss Per Share

Basic net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted net loss per share attributable to common stockholders is computed by dividing the diluted net loss attributable to common stockholders by the weighted average number of common shares, including potential dilutive common shares assuming the dilutive effect of outstanding stock options and unvested restricted common shares, as determined using the treasury stock method. For periods in which the Company has reported net losses, diluted net loss per common share attributable to common stockholders is the same as basic net loss per common share attributable to common stockholders, since dilutive common shares are not assumed to have been issued if their effect is antidilutive.

The Company excluded the following common stock equivalents, outstanding as of September 30, 2019 and 2018, from the computation of diluted net loss per share for the three and nine months ended September 30, 2019 and 2018 because they had an anti-dilutive impact due to the net loss incurred for the periods:

	As of September 30,
	2019		2018
Options to purchase common stock		5,118,280		5,676,861
Unvested restricted common stock		56,770		4,465
		5,175,050		5,681,326

Recently Issued and Adopted Accounting Pronouncements

In February 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU No. 2016-02, Leases and in July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements. The new leasing standards generally require lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the consolidated balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements.

We adopted the new leasing standards using the modified retrospective transition approach, as of January 1, 2019, with no restatement of prior periods or cumulative adjustment to retained earnings. Upon adoption, we elected the package of transition practical expedients, which allowed us to carry forward prior conclusions related to whether any expired or existing contracts are or contain leases, the lease classification for any expired or existing leases and initial direct costs for existing leases. In addition, the Company elected the hindsight practical expedient to determine the lease term for existing leases. The Company elected not to record leases with an initial term of 12 months or less on the balance sheet and recognize the associated lease payments in the consolidated statements of operations on a straight-line basis over the lease term. Upon adoption of the new leasing standards we recognized an operating lease asset of approximately $1.0 million and a corresponding operating lease liability of approximately $1.0 million, which are included in our condensed consolidated balance sheet. The adoption of the new leasing standards did not have an impact on our condensed consolidated statements of income or cash flows.

We determine if an arrangement is a lease at contract inception. Operating lease assets represent our right to use an underlying asset for the lease term and operating lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the commencement date of the lease based upon the present value of lease payments over the lease term. When determining the lease term, we include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. We use the implicit rate when readily determinable and use our incremental borrowing rate when the implicit rate is not readily determinable based upon the information available at the commencement date in determining the present value of the lease payments. Our incremental borrowing rate is determined using a secured borrowing rate for the same currency and term as the associated lease.

The lease payments used to determine our operating lease assets may include lease incentives, stated rent increases and escalation clauses linked to rates of inflation when determinable and are recognized in our operating lease assets in our condensed consolidated balance sheets.

Our operating leases are reflected in operating lease right-of-use assets, accrued expenses and in long-term operating lease liabilities in our condensed consolidated balance sheets. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

For additional information on the adoption of the new leasing standards, please read Note 7, Commitments and Contingencies, to these condensed consolidated financial statements.

In June 2018, the FASB issued ASU No. 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This ASU is intended to simplify aspects of share-based compensation issued to non-employees by making the guidance consistent accounting for employee share-based compensation. This standard was effective for the Company in 2019. The adoption of this guidance had an immaterial impact on the Company’s consolidated financial statements as of and for the three and nine months ended September 30, 2019.

Fair Value Measurements and Marketable Securities

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements and Marketable Securities

3. Fair Value Measurements and Marketable Securities

Fair Value Measurements

The following tables present information about the Company’s financial assets that have been measured at fair value as of September 30, 2019 and December 31, 2018 and indicate the fair value of the hierarchy of the valuation inputs utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair value determined by Level 2 inputs utilize observable inputs other than Level 1 prices, such as quoted prices, for similar assets or liabilities, quoted market 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 related assets or liabilities. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. During the three and nine months ended September 30, 2019 and the year ended December 31, 2018, there were no transfers between Level 1 and Level 2 financial assets.

The following tables summarize the Company’s cash equivalents and marketable securities as of September 30, 2019 and December 31, 2018:

	September 30, 2019
			Quoted		Significant
			Prices in		Other		Significant
			Active		Observable		Unobservable
			Markets		Inputs		Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Cash equivalents:
Money market funds	$	33,344	$	33,344	$	—	$	—
Commercial paper		700		—		700		—
Total cash equivalents		34,044		33,344		700		—

Marketable securities:
Commercial paper		13,479		—		13,479		—
Corporate bonds		13,169		—		13,169		—
U.S. Government securities		12,021		—		12,021		—
Total marketable securities		38,669		—		38,669		—
Total cash equivalents and marketable securities	$	72,713	$	33,344	$	39,369	$	—

		December 31, 2018
				Quoted		Significant
				Prices in		Other		Significant
				Active		Observable		Unobservable
				Markets		Inputs		Inputs
		Total		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Cash equivalents:
Money market funds		$	40,231	$	40,231	$	—	$	—
Commercial paper			4,979		—		4,979		—
Total cash equivalents			45,210		40,231		4,979		—

Marketable securities:
Commercial paper			38,911		—		38,911		—
Corporate bonds			25,830		—		25,830		—
U.S. Government securities			3,994		—		3,994		—
Total marketable securities			68,735		—		68,735		—
Total cash equivalents and marketable securities		$	113,945	$	40,231	$	73,714	$	—

The carrying amounts reflected in the condensed consolidated balance sheets for tax incentive receivable, accounts payable, and accrued expenses and other approximate fair value due to their short-term maturities. The carrying value of the Company’s outstanding notes payable approximates fair value (a Level 2 fair value measurement), reflecting interest rates currently available to the Company.

Marketable Securities

The following tables summarize the Company’s marketable securities as of September 30, 2019 and December 31, 2018:

	September 30, 2019
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(in thousands)
Assets:
Commercial paper (due within 1 year)	$	13,479	$	—	$	—	$	13,479
Corporate bonds (due within 1 year)		13,137		32		—		13,169
U.S. Government securities (due within 1 year)		12,011		10		—		12,021
	$	38,627	$	42	$	—	$	38,669

	December 31, 2018
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses			Fair Value
	(in thousands)
Assets:
Commercial paper (due within 1 year)	$	38,921	$	—	$	(10	)	$	38,911
Corporate bonds (due within 1 year)		25,851		3		(24	)		25,830
U.S. Government securities (due within 1 year)		3,995		—		(1	)		3,994
	$	68,767	$	3	$	(35	)	$	68,735

- 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

Notes Payable

9 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

Notes Payable

5. Notes Payable

On December 29, 2017, the Company entered into a loan and security agreement with Silicon Valley Bank (the “Term Loan”). The Term Loan provided for borrowings of $20.0 million. On December 29, 2017, the Company received proceeds of $20.0 million from the issuance of a promissory note. The promissory note issued under the Term Loan is collateralized by substantially all of the Company’s personal property, other than its intellectual property.

Upon entering into the Term Loan, the Company became obligated to make monthly, interest-only payments until March 29, 2019 and, thereafter, to pay 33 consecutive, equal monthly installments of principal and interest from April 1, 2019 through December 1, 2021. The outstanding Term Loan bears a variable interest at an annual rate of 1.25% above the prime rate, which at September 30, 2019 was 5.0%. In addition, a final payment equal to 8.0% of the Term Loan is due upon the earlier of the maturity date, acceleration of the Term Loan or prepayment of all or part of the Term Loan. The Company accrues the final payment amount of $1.6 million, to outstanding debt by charges to interest expense using the effective-interest method from the date of issuance through the maturity date.

Additionally, the Company, as borrower, is required to maintain a minimum cash, cash equivalents and marketable securities balance at Silicon Valley Bank of no less than 105% of the total outstanding principal balance of the Term Loan, which was $17.2 million and $21.0 million as of September 30, 2019 and December 31, 2018, respectively.

Further, from 45 days after the Term Loan was entered in, the Company has met its obligation to maintain a balance of unrestricted cash, cash equivalents and marketable securities at Silicon Valley Bank in an amount not less than the greater of (i) $55.0 million and (ii) sixty-five percent (65%) of all the Company’s cash, cash equivalents and marketable securities. If the Company does not meet this requirement it will not be considered an event of default provided it immediately secures 87.5% of the principal balance in a restricted cash account.

There are negative covenants restricting the Company’s activities, including limitations on dispositions, mergers or acquisitions; encumbering or granting a security interest in its intellectual property; incurring indebtedness or liens; paying dividends; making certain investments; limiting the aggregate value of cash maintained by its Australian subsidiary not to exceed $4.0 million and certain other business transactions.

The Term Loan also includes events of default, the occurrence and continuation of any of which provides the lenders the right to exercise remedies against the Company and the collateral securing the amounts due under the Term Loan, including cash in the amount of the outstanding balance. These events of default include, among other things, failure to pay any amounts due under the Term Loan, insolvency, the occurrence of a material adverse event, the occurrence of any default under certain other indebtedness and a final judgment against the Company in an amount greater than $0.3 million. The Company has estimated that the risk of subjective acceleration under the material adverse events clause is reasonably possible, however not probable and therefore have classified the outstanding principal in current and long-term liabilities based on contractually scheduled principal payments. However, the assessment of such probability of the debt holder calling the debt is subjective and their actions and/or the Company’s related assessment could change in the future, which in turn would impact the classification of the debt balances.

As of September 30, 2019 and December 31, 2018, notes payable consist of the following:

	September 30,			December 31,
	2019			2018
	(in thousands)
Notes payable	$	16,364		$	20,000
Less: current portion		(7,273	)		(5,455	)
Notes payable, net of current portion		9,091			14,545
Accretion related to final payment		1,075			640
Notes payable, long term	$	10,166		$	15,185

As of September 30, 2019, the estimated future principal payments due are as follows:

Year Ending December 31,
(in thousands)
2019 (October - December)	$	1,818
2020		7,273
2021		7,273
Total	$	16,364

During the three and nine months ended September 30, 2019, the Company recognized $0.4 million and $1.4 million, respectively, of interest expense related to the Term Loan. During the three and nine months ended September 30, 2018, the Company recognized $0.5 million and $1.4 million, respectively, of interest expense related to the Term Loan. The effective annual interest rate as of September 30, 2019 on the outstanding debt under the Term Loan was approximately 9.4%.

Stock-Based Awards

9 Months Ended

Sep. 30, 2019

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Awards

6. Stock-Based Awards

The Company’s 2014 Stock Option and Incentive Plan, as amended (the “2014 Plan”) provides for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units, unrestricted stock awards, performance-share awards, cash-based awards and dividend equivalent rights to employees, members of the board of directors and consultants of the Company. The Company has outstanding stock-based awards under its Amended and Restated 2006 Stock Option Plan but is no longer granting awards under this plan. The Company also issues common stock under its 2014 Employee Stock Purchase Plan (the “ESPP”). As of September 30, 2019, 4,197,460 shares are available for grant under the 2014 Plan, including 1,491,488 shares automatically added to the 2014 Plan on January 1, 2019, and 69,531 shares are available for issuance to participating employees under the ESPP.

The following tables summarize the Company’s stock option activity since December 31, 2018 and through September 30, 2019:

	Shares			Weighted		Average
	Issuable			Average		Remaining	Aggregate
	Under			Exercise		Contractual	Intrinsic
	Options			Price		Term	Value
						(in years)	(in thousands)
Outstanding as of December 31, 2018		5,024,371		$	8.85	7.6	$	3,143
Granted		2,276,197		$	4.00
Exercised		(10,667	)	$	0.75
Forfeited		(2,171,621	)	$	7.60
Outstanding as of September 30, 2019		5,118,280		$	7.24	6.4	$	—
Options exercisable as of September 30, 2019		2,701,812		$	9.53	4.2	$	—

The Company recorded stock-based compensation expense related to stock options, restricted common stock and the ESPP in the following expense categories within its condensed consolidated statements of operations for the three and nine months ended September 30, 2019 and 2018 as follows:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2019			2018		2019		2018
	(in thousands)
Research and development	$	(359	)	$	1,027	$	1,337	$	4,263
General and administrative		963			1,173		3,218		3,074
	$	604		$	2,200	$	4,555	$	7,337

Commitments and Contingencies

9 Months Ended

Sep. 30, 2019

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

7. Commitments and Contingencies

Leases

On February 12, 2019, the Company entered into a lease with Shigo Center Plaza Owners, LLC, for approximately 17,705 square feet of office space for a new headquarters located at 3 Center Plaza, Boston, Massachusetts. The lease has a term of 124 months with an option to extend the lease for 60 additional months. As part of the agreement the Company is required to maintain a letter of credit, which upon signing was $1.3 million and is classified as restricted cash within the condensed consolidated financial statements. Under the lease agreement, the Company will pay monthly rent beginning four months after the lease commencement, which was June 21, 2019, with total lease payments over the initial term of $10.7 million.

The Company also had a lease for office space in Boston, Massachusetts, effective as of July 28, 2014, with a term expiring July 31, 2020. On June 28, 2019, the Company amended the lease to terminate the lease effective as of June 30, 2019.

In March 2015, the Company entered into an operating lease for additional office space in Boston, Massachusetts, effective as of April 15, 2015, with a term expiring on July 31, 2020, and an option to extend this lease for three additional years. In addition, with the landlord’s consent, the Company has subleased 2,976 square feet of office space in Boston, Massachusetts to an unrelated third party beginning on January 1, 2017 and expiring on June 30, 2020, and the Company expects to receive approximately $0.1 million in sublease rental income from October 1, 2019 through the end of the sublease term.

In October 2015, the Company entered into an operating lease for office space in San Diego, California, effective as of October 1, 2015, with a term extended to expire on December 31, 2024.

The future minimum lease payments for the next five years and thereafter as of September 30, 2019, are as follows:

Year Ending December 31,	Operating
(in thousands)	Leases
2019 (October - December)		193
2020		1,090
2021		1,120
2022		1,143
2023		1,165
Thereafter		6,585
Total lease payments		11,296
Less: imputed interest		(4,385	)
Present value of lease liabilities	$	6,911

Under the prior lease guidance minimum rental commitments under non-cancelable leases for each of the next five years and thereafter as of December 31, 2018, were as follows:

Year Ending December 31,	Operating
(in thousands)	Leases
2019	$	464
2020		226
2021		—
2022		—
2023		—
Thereafter		—
Total lease payments	$	690

During the three months ended September 30, 2019 we incurred $0.2 million of lease expense associated with research and development and $0.2 million of lease expense associated with general and administrative activities. During the nine months ended September 30, 2019 we incurred $0.5 million of lease expense associated with research and development and $0.2 million of lease expense associated with general and administrative activities. The components of lease expense are as follows:

	Three Months			Nine Months
	Ended September 30,			Ended September 30,
	2019			2019
	(in thousands)
Operating lease cost	$	330		$	577
Short-term lease cost		72			185
Sublease income		(28	)		(83	)
Total lease cost	$	374		$	679

During the three and nine months ended September 30, 2018 the Company recognized $0.1million and $0.3 million of rental expense related to office space, respectively.

The following table summarizes the presentation in our condensed consolidated balance sheet information related to our operating leases:

	As of September 30,
	2019
	(in thousands)
Assets
Operating lease right-of-use assets	$	7,172
Liabilities
Operating lease liabilities, short-term		409
Operating lease liabilities, long-term		6,502
Total operating lease liabilities	$	6,911

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

	As of September 30,
	2019
Weighted average remaining lease term in years		9.73
Weighted average discount rate		11.1	%

Supplemental cash flow information related to leases was as follow:

	Three Months		Nine Months
	Ended September 30,		Ended September 30,
	2019		2019
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	27	$	216
Investing cash flows from operating leases		287		586
Right-of-use assets obtained in exchange for lease obligations:
Operating leases		—		6,817

Intellectual Property Licenses

The Company has acquired exclusive rights to develop patented compounds and related know-how for beloranib under two licensing agreements with two third parties in the course of its research and development activities. The licensing rights obligate the Company to make payments to the licensors for license fees, milestones, license maintenance fees and royalties. The Company is also responsible for patent prosecution costs.

As of September 30, 2019, the Company is obligated to make additional milestone payments of up to $12.3 million upon reaching certain pre-commercialization milestones, such as clinical trials and government approvals (including the FDA approval of a New Drug application (“NDA”)), and up to $12.5 million upon reaching certain product commercialization milestones related to the development of beloranib. Under one of the license agreements, the Company is also obligated to pay up to $1.3 million with respect to each subsequent licensed product, if any, that is a new chemical entity. In addition, the Company will owe single-digit royalties on sales of commercial products developed using these licensed technologies, if any, and is also obligated to pay to the licensors a percentage of fees received if and when the Company sublicenses the technology.

There were no milestones achieved during the three and nine months ended September 30, 2019 and 2018 and the development related to this technology is no longer active. As of September 30, 2019, the Company has not yet developed a commercial product using the licensed technologies and it has not entered into any sublicense agreements for the technologies.

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 management team and its board of directors 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. To date, the Company has not incurred any material costs as a result of such indemnifications. The Company is not currently aware of any indemnification claims and has not accrued any liabilities related to such obligations in its consolidated financial statements as of September 30, 2019 or December 31, 2018.

Legal Proceedings

The Company accrues a liability for legal contingencies when it believes that it is both probable that a liability has been incurred and that the Company can reasonably estimate the amount of the loss. The Company reviews these accruals and adjusts them to reflect ongoing negotiations, settlements, rulings, advice of legal counsel and other relevant information. To the extent new information is obtained and the views on the probable outcomes of claims, suits, assessments, investigations or legal proceedings change, changes in the Company’s accrued liabilities would be recorded in the period in which such determination is made. In addition, in accordance with the relevant authoritative guidance, for any matters in which the likelihood of material loss is at least reasonably possible, the Company will provide disclosure of the possible loss or range of loss. If a reasonable estimate cannot be made, however, the Company will provide disclosure to that effect. The Company expenses legal costs as they are incurred.

The Company may periodically become subject to other legal proceedings and claims arising in connection with ongoing business activities, including claims or disputes related to patents that have been issued or that are pending in the field of research on which the Company is focused. The Company is not aware of any material claims as of September 30, 2019.

Restructuring

9 Months Ended

Sep. 30, 2019

Restructuring And Related Activities [Abstract]

Restructuring

10. Restructuring

In September 2019, the Company’s Board of Directors approved a restructuring plan to reduce operating costs and better align the Company’s workforce with the needs of its business following the Company’s September 5, 2019 announcement regarding the low probability of resolving the clinical hold of ZGN-1061 in the near-term and that the Company will be seeking strategic alternatives.

Under the restructuring plan and a previously announced July 2019 restructuring, the Company reduced its workforce by 20 employees (approximately 63% of total employees) and closed its office in San Diego, California. Affected employees are eligible to receive severance payments and outplacement services in connection with the reduction. In the three months ended September 30, 2019, the Company recorded aggregate restructuring charges of approximately $4.0 million related to contract termination, closing of its office in San Diego, severance payments and other employee-related costs. The Company does not expect to incur any additional significant costs associated with this restructuring. During the three months ended September 30, 2019, $0.3 million of the estimated restructuring charges were paid. The Company expects the remaining accrued restructuring costs of $3.6 million will be paid in the next 12 months.

The following table shows the total amount expected to be incurred and the liability related to the 2019 restructuring as of September 30, 2019:

	One-Time
	Employee			Contract
	Termination			Termination			Total
	Benefits			Costs			Expenses
	(in thousands)
Accrued restructuring costs beginning balance	$	—		$	—		$	—
Restructuring charges incurred during the period		2,512			1,427			3,939
Amounts paid during the period		(248	)		(72	)		(320	)
Accrued restructuring costs as of September 30, 2019	$	2,264		$	1,355		$	3,619

The following table summarizes the restructuring charges by category for the periods indicated:

	Cash		Non-Cash		Total
	(in thousands)
Research and Development	$	3,846	$	80	$	3,926
General and Administrative		93		—	$	93
	$	3,939	$	80	$	4,019

Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2019

Accounting Policies [Abstract]

Unaudited Interim Financial Information

Use of Estimates

Marketable securities

Net Loss Per Share

	As of September 30,
	2019		2018
Options to purchase common stock		5,118,280		5,676,861
Unvested restricted common stock		56,770		4,465
		5,175,050		5,681,326

Recently Issued and Adopted Accounting Pronouncements

For additional information on the adoption of the new leasing standards, please read Note 7, Commitments and Contingencies, to these condensed consolidated financial statements.

Fair Value Measurements and Marketable Securities (Tables)

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Summary of Cash Equivalents and Marketable Securities

The following tables summarize the Company’s cash equivalents and marketable securities as of September 30, 2019 and December 31, 2018:

	September 30, 2019
			Quoted		Significant
			Prices in		Other		Significant
			Active		Observable		Unobservable
			Markets		Inputs		Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Cash equivalents:
Money market funds	$	33,344	$	33,344	$	—	$	—
Commercial paper		700		—		700		—
Total cash equivalents		34,044		33,344		700		—

Marketable securities:
Commercial paper		13,479		—		13,479		—
Corporate bonds		13,169		—		13,169		—
U.S. Government securities		12,021		—		12,021		—
Total marketable securities		38,669		—		38,669		—
Total cash equivalents and marketable securities	$	72,713	$	33,344	$	39,369	$	—

		December 31, 2018
				Quoted		Significant
				Prices in		Other		Significant
				Active		Observable		Unobservable
				Markets		Inputs		Inputs
		Total		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Cash equivalents:
Money market funds		$	40,231	$	40,231	$	—	$	—
Commercial paper			4,979		—		4,979		—
Total cash equivalents			45,210		40,231		4,979		—

Marketable securities:
Commercial paper			38,911		—		38,911		—
Corporate bonds			25,830		—		25,830		—
U.S. Government securities			3,994		—		3,994		—
Total marketable securities			68,735		—		68,735		—
Total cash equivalents and marketable securities		$	113,945	$	40,231	$	73,714	$	—

Summary of Marketable Securities

The following tables summarize the Company’s marketable securities as of September 30, 2019 and December 31, 2018:

	September 30, 2019
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(in thousands)
Assets:
Commercial paper (due within 1 year)	$	13,479	$	—	$	—	$	13,479
Corporate bonds (due within 1 year)		13,137		32		—		13,169
U.S. Government securities (due within 1 year)		12,011		10		—		12,021
	$	38,627	$	42	$	—	$	38,669

	December 31, 2018
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses			Fair Value
	(in thousands)
Assets:
Commercial paper (due within 1 year)	$	38,921	$	—	$	(10	)	$	38,911
Corporate bonds (due within 1 year)		25,851		3		(24	)		25,830
U.S. Government securities (due within 1 year)		3,995		—		(1	)		3,994
	$	68,767	$	3	$	(35	)	$	68,735

Stock-Based Awards (Tables)

9 Months Ended

Sep. 30, 2019

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Stock Option Activity

The following tables summarize the Company’s stock option activity since December 31, 2018 and through September 30, 2019:

	Shares			Weighted		Average
	Issuable			Average		Remaining	Aggregate
	Under			Exercise		Contractual	Intrinsic
	Options			Price		Term	Value
						(in years)	(in thousands)
Outstanding as of December 31, 2018		5,024,371		$	8.85	7.6	$	3,143
Granted		2,276,197		$	4.00
Exercised		(10,667	)	$	0.75
Forfeited		(2,171,621	)	$	7.60
Outstanding as of September 30, 2019		5,118,280		$	7.24	6.4	$	—
Options exercisable as of September 30, 2019		2,701,812		$	9.53	4.2	$	—

Summary of Stock-Based Compensation Expense Related to Stock Options, Restricted Common Stock and ESPP

	Three Months Ended September 30,					Nine Months Ended September 30,
	2019			2018		2019		2018
	(in thousands)
Research and development	$	(359	)	$	1,027	$	1,337	$	4,263
General and administrative		963			1,173		3,218		3,074
	$	604		$	2,200	$	4,555	$	7,337

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2019

Commitments And Contingencies Disclosure [Abstract]

Schedule of Future Minimum Lease Payments for Operating Leases

The future minimum lease payments for the next five years and thereafter as of September 30, 2019, are as follows:

Year Ending December 31,	Operating
(in thousands)	Leases
2019 (October - December)		193
2020		1,090
2021		1,120
2022		1,143
2023		1,165
Thereafter		6,585
Total lease payments		11,296
Less: imputed interest		(4,385	)
Present value of lease liabilities	$	6,911

Under the prior lease guidance minimum rental commitments under non-cancelable leases for each of the next five years and thereafter as of December 31, 2018, were as follows:

Year Ending December 31,	Operating
(in thousands)	Leases
2019	$	464
2020		226
2021		—
2022		—
2023		—
Thereafter		—
Total lease payments	$	690

Schedule of Components of Leases Expense

The components of lease expense are as follows:

	Three Months			Nine Months
	Ended September 30,			Ended September 30,
	2019			2019
	(in thousands)
Operating lease cost	$	330		$	577
Short-term lease cost		72			185
Sublease income		(28	)		(83	)
Total lease cost	$	374		$	679

Summary of Balance Sheet Information Related to Leases

The following table summarizes the presentation in our condensed consolidated balance sheet information related to our operating leases:

	As of September 30,
	2019
	(in thousands)
Assets
Operating lease right-of-use assets	$	7,172
Liabilities
Operating lease liabilities, short-term		409
Operating lease liabilities, long-term		6,502
Total operating lease liabilities	$	6,911

Schedule of Weighted Average Remaining Lease Term and Weighted Average Discount Rate of Operating Leases

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

	As of September 30,
	2019
Weighted average remaining lease term in years		9.73
Weighted average discount rate		11.1	%

Schedule of Supplemental Cash Flow Information Related to Leases

Supplemental cash flow information related to leases was as follow:

	Three Months		Nine Months
	Ended September 30,		Ended September 30,
	2019		2019
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	27	$	216
Investing cash flows from operating leases		287		586
Right-of-use assets obtained in exchange for lease obligations:
Operating leases		—		6,817

Restructuring (Tables)

9 Months Ended

Sep. 30, 2019

Restructuring And Related Activities [Abstract]

Summary of Accrued Restructuring Costs

The following table shows the total amount expected to be incurred and the liability related to the 2019 restructuring as of September 30, 2019:

	One-Time
	Employee			Contract
	Termination			Termination			Total
	Benefits			Costs			Expenses
	(in thousands)
Accrued restructuring costs beginning balance	$	—		$	—		$	—
Restructuring charges incurred during the period		2,512			1,427			3,939
Amounts paid during the period		(248	)		(72	)		(320	)
Accrued restructuring costs as of September 30, 2019	$	2,264		$	1,355		$	3,619

Summary of Restructuring Charges by Category

The following table summarizes the restructuring charges by category for the periods indicated:

	Cash		Non-Cash		Total
	(in thousands)
Research and Development	$	3,846	$	80	$	3,926
General and Administrative		93		—	$	93
	$	3,939	$	80	$	4,019

Nature of the Business and Basis of Presentation - Additional Information (Detail) - USD ($)		9 Months Ended	167 Months Ended
	Jul. 02, 2018	Sep. 30, 2019	Sep. 30, 2019	Dec. 31, 2018	Dec. 29, 2017
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items]
Entity incorporation date		Nov. 22, 2005
Restructuring and other attrition, percentage of workforce reduction		70.00%
Accumulated deficit		$ 389,100,000	$ 389,100,000	$ 350,945,000
Net proceeds from sale of securities			397,900,000
Credit facility default amount		300,000	300,000
Total cash, cash equivalents and marketable securities		82,000,000	82,000,000
Term Loan [Member]
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items]
Aggregate principal balance		16,400,000	16,400,000		$ 20,000,000
Loan agreement minimum liquidity required		$ 17,200,000	$ 17,200,000	$ 21,000,000
Public Offering [Member]
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items]
Issuance of common stock	9,200,000
Share price per share	$ 7.50
Net proceeds from public offering, after underwriting discount, commission and offering expenses	$ 64,600,000

Notes Payable - Additional Information (Detail) - USD ($)		3 Months Ended		9 Months Ended
	Dec. 29, 2017	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Debt Instrument [Line Items]
Proceeds from issuance of notes payable	$ 20,000,000
Unrestricted cash, cash equivalents and marketable securities		$ 82,000,000		$ 82,000,000
Credit facility default amount		300,000		300,000
Maximum [Member]
Debt Instrument [Line Items]
Aggregate value of cash maintained by Australian subsidiary, limit				4,000,000
Term Loan [Member]
Debt Instrument [Line Items]
Maximum borrowings under term loan	$ 20,000,000	$ 16,400,000		$ 16,400,000
Debt facility description				Upon entering into the Term Loan, the Company became obligated to make monthly, interest-only payments until March 29, 2019 and, thereafter, to pay 33 consecutive, equal monthly installments of principal and interest from April 1, 2019 through December 1, 2021. The outstanding Term Loan bears a variable interest at an annual rate of 1.25% above the prime rate, which at September 30, 2019 was 5.0%. In addition, a final payment equal to 8.0% of the Term Loan is due upon the earlier of the maturity date, acceleration of the Term Loan or prepayment of all or part of the Term Loan.
Debt maturity date	Dec. 01, 2021
Debt facility interest rate description				1.25% above the prime rate
Debt facility variable interest at annual rate	1.25%
Debt facility effective interest rate		5.00%		5.00%
Debt facility fee percentage	8.00%
Charges to interest expense of debt outstanding	$ 1,600,000
Loan agreement minimum liquidity required		$ 17,200,000		$ 17,200,000		$ 21,000,000
Debt facility covenant description				Further, from 45 days after the Term Loan was entered in, the Company has met its obligation to maintain a balance of unrestricted cash, cash equivalents and marketable securities at Silicon Valley Bank in an amount not less than the greater of (i) $55.0 million and (ii) sixty-five percent (65%) of all the Company’s cash, cash equivalents and marketable securities. If the Company does not meet this requirement it will not be considered an event of default provided it immediately secures 87.5% of the principal balance in a restricted cash account.
Percentage of principal balance to be secured in restricted cash account for not to be considered an event of default				87.50%
Interest expense on term loan		400,000	$ 500,000	$ 1,400,000	$ 1,400,000
Debt facility effective interest rate				9.40%
Term Loan [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Percentage equivalent of cash, cash equivalents and marketable securities balance				105.00%
Unrestricted cash, cash equivalents and marketable securities		$ 55,000,000		$ 55,000,000
Percentage of cash, cash equivalents and marketable securities		65.00%		65.00%

Stock-Based Awards - Summary of Stock Option Activity (Detail) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Shares issuable under options, beginning balance	5,024,371
Shares issuable under options, granted	2,276,197
Shares issuable under options, exercised	(10,667)
Shares issuable under options, forfeited	(2,171,621)
Shares issuable under options, ending balance	5,118,280	5,024,371
Shares issuable under options, options exercisable	2,701,812
Weighted-average exercise price, beginning balance	$ 8.85
Weighted-average exercise price, granted	4.00
Weighted-average exercise price, exercised	0.75
Weighted-average exercise price, forfeited	7.60
Weighted-average exercise price, ending balance	7.24	$ 8.85
Weighted-average exercise price, options exercisable	$ 9.53
Average remaining contractual life	6 years 4 months 24 days	7 years 7 months 6 days
Average remaining contractual life, options exercisable	4 years 2 months 12 days
Aggregate intrinsic value		$ 3,143

Commitments and Contingencies - Additional Information (Detail)							3 Months Ended		9 Months Ended
	Jun. 28, 2019	Feb. 12, 2019 USD ($) ft²	Jan. 01, 2017 ft²	Oct. 01, 2015	Apr. 15, 2015 Option	Jul. 28, 2014	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Jun. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)
Other Commitments [Line Items]
Total lease payments over the initial term							$ 11,296,000			$ 11,296,000
Sublease rental income							28,000			83,000
Lease expense							374,000	$ 100,000		679,000	$ 300,000
Milestone payments due							0	$ 0		0	$ 0
Subsequent Licensed Product [Member]
Other Commitments [Line Items]
Licensing fees per product maximum							1,300,000			1,300,000
Maximum [Member] \| Pre Commercialization Milestones [Member]
Other Commitments [Line Items]
Milestone payments							12,300,000			12,300,000
Maximum [Member] \| Product Commercialization Milestones [Member]
Other Commitments [Line Items]
Milestone payments							12,500,000			12,500,000
Research and Development [Member]
Other Commitments [Line Items]
Lease expense							200,000			500,000
General and Administrative [Member]
Other Commitments [Line Items]
Lease expense							$ 200,000			$ 200,000
Boston Office Space [Member]
Other Commitments [Line Items]
Lease expiration date						Jul. 31, 2020
Amendment of lease, effective date of termination	Jun. 30, 2019
Boston Office Space [Member] \| Unrelated Third Party [Member]
Other Commitments [Line Items]
Subleased area \| ft²			2,976
Sublease expiration date			Jun. 30, 2020
Boston Office Space [Member] \| Unrelated Third Party [Member] \| Scenario Forecast [Member]
Other Commitments [Line Items]
Sublease rental income									$ 100,000
Additional Boston Office Space [Member]
Other Commitments [Line Items]
Lease extension period					3 years
Operating lease, existence of option to extend					true
Lease expiration date					Jul. 31, 2020
Number of options to extend lease \| Option					1
San Diego Office Space [Member]
Other Commitments [Line Items]
Lease expiration date				Dec. 31, 2024
Center Plaza, Boston [Member] \| Massachusetts [Member] \| Shigo Center Plaza Owners LLC [Member]
Other Commitments [Line Items]
Area of office space \| ft²		17,705
Operating lease term		124 months
Lease extension period		60 months
Letter of credit		$ 1,300,000
Operating lease, existence of option to extend		true
Total lease payments over the initial term		$ 10,700,000
Lease commencement date		Jun. 21, 2019

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2019	Dec. 31, 2018
Statement Of Financial Position [Abstract]
Preferred stock, par value per share	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value per share	$ 0.001	$ 0.001
Common stock, shares authorized	115,000,000	115,000,000
Common stock, shares issued	37,370,301	37,287,221
Common stock, shares outstanding	37,370,301	37,287,221

Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Thousands	Sep. 30, 2019	Jan. 01, 2019
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]
Operating lease right-of-use assets	$ 7,172
Operating lease liabilities	$ 6,502
ASU 2016-02 [Member]
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]
Operating lease right-of-use assets		$ 1,000
Operating lease liabilities		$ 1,000

Accrued Expenses and Other - Schedule of Accrued Expenses and Other (Detail) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Payables And Accruals [Abstract]
Accrued research and development expenses	$ 310	$ 1,526
Accrued payroll and related expenses	798	2,291
Accrued professional fees	355	221
Accrued other	256	223
Total accrued expenses and other	$ 1,719	$ 4,261

Stock-Based Awards - Additional Information (Detail) - shares	Jan. 01, 2019	Sep. 30, 2019
2014 Stock Option and Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock available for issuance		4,197,460
Shares added to plan	1,491,488
2014 Employee Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock available for issuance		69,531

Commitments and Contingencies - Schedule of Weighted Average Remaining Lease Term and Weighted Average Discount Rate of Operating Leases (Detail)	Sep. 30, 2019
Leases [Abstract]
Weighted average remaining lease term in years	9 years 8 months 23 days
Weighted average discount rate	11.10%

Summary of Significant Accounting Policies - Summary of Common Stock Equivalents Outstanding (Detail) - shares	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total potentially dilutive shares	5,175,050	5,681,326
Options to Purchase Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total potentially dilutive shares	5,118,280	5,676,861
Unvested Restricted Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total potentially dilutive shares	56,770	4,465

Fair Value Measurements and Marketable Securities - Summary of Cash Equivalents and Marketable Securities (Detail) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	$ 34,044	$ 45,210
Marketable securities	38,669	68,735
Total cash equivalents and marketable securities	72,713	113,945
Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	33,344	40,231
Commercial Paper [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	700	4,979
Marketable securities	13,479	38,911
Corporate Bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	13,169	25,830
U.S. Government Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	12,021	3,994
Quoted Prices in Active Markets, (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	33,344	40,231
Total cash equivalents and marketable securities	33,344	40,231
Quoted Prices in Active Markets, (Level 1) [Member] \| Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	33,344	40,231
Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	700	4,979
Marketable securities	38,669	68,735
Total cash equivalents and marketable securities	39,369	73,714
Significant Other Observable Inputs (Level 2) [Member] \| Commercial Paper [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	700	4,979
Marketable securities	13,479	38,911
Significant Other Observable Inputs (Level 2) [Member] \| Corporate Bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	13,169	25,830
Significant Other Observable Inputs (Level 2) [Member] \| U.S. Government Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	$ 12,021	$ 3,994

Fair Value Measurements and Marketable Securities - Summary of Marketable Securities (Detail) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 38,627	$ 68,767
Gross Unrealized Gains	42	3
Gross Unrealized Losses		(35)
Fair Value	38,669	68,735
Commercial Paper (Due within 1 Year) [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	13,479	38,921
Gross Unrealized Losses		(10)
Fair Value	13,479	38,911
Corporate Bonds (Due within 1 Year) [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	13,137	25,851
Gross Unrealized Gains	32	3
Gross Unrealized Losses		(24)
Fair Value	13,169	25,830
U.S. Government Securities (Due within 1 Year) [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	12,011	3,995
Gross Unrealized Gains	10
Gross Unrealized Losses		(1)
Fair Value	$ 12,021	$ 3,994

Notes Payable - Schedule of Notes Payable (Detail) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Debt Instruments [Abstract]
Notes payable	$ 16,364	$ 20,000
Less: current portion	(7,273)	(5,455)
Notes payable, net of current portion	9,091	14,545
Accretion related to final payment	1,075	640
Notes payable, long term	$ 10,166	$ 15,185

Notes Payable - Schedule of Estimated Future Principal Payments (Detail) $ in Thousands	Sep. 30, 2019 USD ($)
Debt Instruments [Abstract]
2019 (October - December)	$ 1,818
2020	7,273
2021	7,273
Total	$ 16,364

Commitments and Contingencies - Schedule of Future Minimum Lease Payments for Operating Leases (Detail) $ in Thousands	Sep. 30, 2019 USD ($)
Leases [Abstract]
2019 (October - December)	$ 193
2020	1,090
2021	1,120
2022	1,143
2023	1,165
Thereafter	6,585
Total lease payments	11,296
Less: imputed interest	(4,385)
Present value of lease liabilities	$ 6,911

Commitments and Contingencies - Schedule of Future Minimum Rental Commitments under Prior Lease Guidance (Detail) $ in Thousands	Dec. 31, 2018 USD ($)
Commitments And Contingencies Disclosure [Abstract]
2019	$ 464
2020	226
Total lease payments	$ 690

Commitments and Contingencies - Summary of Balance Sheet Information Related to Leases (Detail) $ in Thousands	Sep. 30, 2019 USD ($)
Assets
Operating lease right-of-use assets	$ 7,172
Liabilities
Operating lease liabilities, short-term	409
Operating lease liabilities	6,502
Total operating lease liabilities	$ 6,911

Commitments and Contingencies - Schedule of Supplemental Cash Flow Information Related to Leases (Detail) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$ 27	$ 216
Investing cash flows from operating leases	$ 287	586
Right-of-use assets obtained in exchange for lease obligations:
Operating leases		$ 6,817

Restructuring - Additional Information (Detail) $ in Thousands	3 Months Ended
	Sep. 30, 2019 USD ($) Employee
Restructuring And Related Activities [Abstract]
Number of workforce reduction \| Employee	20
Restructuring, percentage of workforce reduction	63.00%
Restructuring charges and related costs	$ 3,939
Restructuring charges paid	320
Accrued restructuring costs	$ 3,619

Restructuring - Summary of Accrued Restructuring Costs (Detail) $ in Thousands	3 Months Ended
	Sep. 30, 2019 USD ($)
Restructuring Cost And Reserve [Line Items]
Restructuring charges incurred during the period	$ 3,939
Amounts paid during the period	(320)
Accrued restructuring costs	3,619
One-Time Employee Termination Benefits [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring charges incurred during the period	2,512
Amounts paid during the period	(248)
Accrued restructuring costs	2,264
Contract Termination Costs [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring charges incurred during the period	1,427
Amounts paid during the period	(72)
Accrued restructuring costs	$ 1,355