0001558370-23-013591 | 10-Q | XBRL Viewer

Net Loss Per Share (Tables)

6 Months Ended

Jun. 30, 2023

Schedule of basic and diluted net (loss) income per share attributable to common stockholders

Basic net loss per share was calculated as follows for the three and six months ended June 30, 2023 and 2022:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023			2022	2023			2022
Numerator:
Net loss attributable to common stockholders	$	(20,682)	$	(18,766)	$	(51,000)	$	(31,308)
Denominator:
Weighted average common shares outstanding, basic		78,047,705		76,764,296		77,718,823		76,755,028
Net loss per share - basic	$	(0.26)	$	(0.24)	$	(0.66)	$	(0.41)

For the three and six months ended June 30, 2023 there was no dilutive impact from potentially issuable common shares. Therefore, diluted net loss per share was the same as basic net loss per share. Diluted net loss per share was calculated as follows for the three and six months ended June 30, 2022:


		Three Months Ended June 30,	Six Months Ended June 30,
		2022		2022
Net loss attributable to common stockholders, basic	$	(18,766)	$	(31,308)
Interest expense on Convertible Notes		1,141		2,264
Change in fair value of derivative liability		(2,773)		(9,731)
Net loss attributable to common stockholders, diluted	$	(20,398)	$	(38,775)

Weighted average common shares outstanding, basic		76,764,296		76,755,028
Shares issuable upon conversion of Convertible Notes, as if converted		5,769,232		5,769,232
Weighted average common shares outstanding, diluted		82,533,528		82,524,260

Net loss per share attributable to common stockholders, diluted	$	(0.25)	$	(0.47)

Schedule of antidilutive securities, excluded from computation of diluted net loss per share


	Three Months Ended June 30,		Six Months Ended June 30,
	2023	2022	2023	2022
Options to purchase common stock	16,333,870	13,892,884	16,333,870	13,892,884
Restricted stock units	1,654,517	1,017,111	1,654,517	1,017,111
Shares issuable upon conversion of Convertible Notes, if converted	5,769,232	—	5,769,232	—
	23,757,619	14,909,995	23,757,619	14,909,995

Derivative Liability	6 Months Ended
Jun. 30, 2023
Derivative Liability
Derivative Liability	8. Derivative Liability The Convertible Notes (Note 7) contain an embedded conversion option that meets the criteria to be bifurcated and accounted for separately from the Convertible Notes (the "Derivative Liability"). The Derivative Liability was recorded at fair value upon the issuance of the Convertible Notes and is subsequently remeasured to fair value at each reporting period. The Convertible Notes were initially valued and are remeasured using a "with-and-without" method. The "with-and-without" methodology involves valuing the whole instrument on an as-is basis with the embedded conversion option and then valuing the Convertible Notes without the embedded conversion option. The difference between the entire instrument with the embedded conversion option compared to the instrument without the embedded conversion option is the fair value of the derivative, recorded as the Derivative Liability. Refer to Note 9 for details regarding the determination of fair value.

Derivative Liability

6 Months Ended

Jun. 30, 2023

Derivative Liability

Derivative Liability

8. Derivative Liability

The Convertible Notes (Note 7) contain an embedded conversion option that meets the criteria to be bifurcated and accounted for separately from the Convertible Notes (the "Derivative Liability"). The Derivative Liability was recorded at fair value upon the issuance of the Convertible Notes and is subsequently remeasured to fair value at each reporting period. The Convertible Notes were initially valued and are remeasured using a "with-and-without" method. The "with-and-without" methodology involves valuing the whole instrument on an as-is basis with the embedded conversion option and then valuing the Convertible Notes without the embedded conversion option. The difference between the entire instrument with the embedded conversion option compared to the instrument without the embedded conversion option is the fair value of the derivative, recorded as the Derivative Liability. Refer to Note 9 for details regarding the determination of fair value.

Nature of the Business	6 Months Ended
Jun. 30, 2023
Nature of the Business
Nature of the Business	1. Nature of the Business Ocular Therapeutix, Inc. (the “Company”) was incorporated on September 12, 2006 under the laws of the State of Delaware. The Company is a biopharmaceutical company focused on the formulation, development and commercialization of innovative therapies for diseases and conditions of the eye using its proprietary bioresorbable hydrogel-based formulation technology ELUTYX. The Company’s mission is to build an ophthalmology-focused biopharmaceutical company that capitalizes on the gaps that the Company believes increasingly exist in the ophthalmology sector between single-product companies and large, multi-product pharmaceutical companies. 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, regulatory approval and compliance, reimbursement, uncertainty of market acceptance of products and the need to obtain additional financing. Recently approved products will require significant sales, marketing and distribution support up to and including upon their launch. Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval, prior to commercialization. The Company is currently commercializing DEXTENZA (dexamethasone insert) 0.4mg, an intracanalicular insert for the treatment of post-surgical ocular inflammation and pain and for the treatment of ocular itching associated with allergic conjunctivitis, in the United States. The Company’s most advanced product candidates are in either Phase 1 or Phase 2 of clinical stage development. There can be no assurance that the Company’s research and development will be successfully completed, that adequate protection for the Company’s intellectual property will be obtained, that any products developed will obtain necessary government regulatory approval and adequate reimbursement 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 rapidly changing 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 may not be able to generate significant revenue from sales of any product for several years, if at all. Accordingly, the Company will need to obtain additional capital to finance its operations. The Company has incurred losses and negative cash flows from operations since its inception, and the Company expects to continue to generate operating losses and negative cash flows from operations in the foreseeable future. As of June 30, 2023, the Company had an accumulated deficit of $667,842. As of June 30, 2023, the Company had existing cash and cash equivalents of $66,606. Subsequent to this date, on August 2, 2023, the Company entered into a new credit facility for $82,474, borrowed the full amount of $82,474 at closing, and received proceeds of $77,790, after the application of a discount and fees (Note 16). In connection with entering the new credit facility, the Company repaid its existing credit facility in August 2023 (Note 16), resulting in cash outflows of $26,157. Based on the Company’s current operating plan which includes estimates of anticipated cash inflows from product sales and cash outflows from operating expenses, and capital expenditures, the Company believes that its existing cash and cash equivalents as of June 30, 2023, plus the net cash received under the new credit facility after the repayment of the existing credit facility and reflecting a minimum liquidity covenant in the new credit facility, will enable it to fund its planned operating expenses, debt service obligations and capital expenditures at least through the next 12 months from the issuance date of these unaudited condensed consolidated financial statements. The future viability of the Company beyond that point is dependent on the Company’s ability to generate cash flows from the sale of DEXTENZA and raise additional capital to finance its operations. The Company will need to finance its operations through public or private securities offerings, debt financings, collaborations, strategic alliances, licensing agreements, royalty agreements, or marketing and distribution agreements. Although the Company has been successful in raising capital in the past, there is no assurance that it will be successful in obtaining such additional financing on terms acceptable to the Company, if at all. If the Company is unable to obtain funding, the Company could be forced to delay, reduce or eliminate some or all of its research and development programs for product candidates, product portfolio expansion or commercialization efforts, which could adversely affect its business prospects, or the Company may be unable to continue operations. On June 30, 2023, the Company entered into an amendment to the Company's lease for its 20,445 square feet of manufacturing space located at 36 Crosby Drive in Bedford, Massachusetts. Under the amendment, the term of the lease was extended through July 31, 2028. The Company had reflected the obligations under the lease extension in its consolidated financial statements for 2022 as set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 6, 2023.

Nature of the Business

6 Months Ended

Jun. 30, 2023

Nature of the Business

Nature of the Business

1. Nature of the Business

Ocular Therapeutix, Inc. (the “Company”) was incorporated on September 12, 2006 under the laws of the State of Delaware. The Company is a biopharmaceutical company focused on the formulation, development and commercialization of innovative therapies for diseases and conditions of the eye using its proprietary bioresorbable hydrogel-based formulation technology ELUTYX. The Company’s mission is to build an ophthalmology-focused biopharmaceutical company that capitalizes on the gaps that the Company believes increasingly exist in the ophthalmology sector between single-product companies and large, multi-product pharmaceutical companies.

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, regulatory approval and compliance, reimbursement, uncertainty of market acceptance of products and the need to obtain additional financing. Recently approved products will require significant sales, marketing and distribution support up to and including upon their launch. Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval, prior to commercialization.

The Company is currently commercializing DEXTENZA (dexamethasone insert) 0.4mg, an intracanalicular insert for the treatment of post-surgical ocular inflammation and pain and for the treatment of ocular itching associated with allergic conjunctivitis, in the United States. The Company’s most advanced product candidates are in either Phase 1 or Phase 2 of clinical stage development. There can be no assurance that the Company’s research and development will be successfully completed, that adequate protection for the Company’s intellectual property will be obtained, that any products developed will obtain necessary government regulatory approval and adequate reimbursement 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 rapidly changing 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 may not be able to generate significant revenue from sales of any product for several years, if at all. Accordingly, the Company will need to obtain additional capital to finance its operations.

The Company has incurred losses and negative cash flows from operations since its inception, and the Company expects to continue to generate operating losses and negative cash flows from operations in the foreseeable future. As of June 30, 2023, the Company had an accumulated deficit of $667,842. As of June 30, 2023, the Company had existing cash and cash equivalents of $66,606. Subsequent to this date, on August 2, 2023, the Company entered into a new credit facility for $82,474, borrowed the full amount of $82,474 at closing, and received proceeds of $77,790, after the application of a discount and fees (Note 16). In connection with entering the new credit facility, the Company repaid its existing credit facility in August 2023 (Note 16), resulting in cash outflows of $26,157. Based on the Company’s current operating plan which includes estimates of anticipated cash inflows from product sales and cash outflows from operating expenses, and capital expenditures, the Company believes that its existing cash and cash equivalents as of June 30, 2023, plus the net cash received under the new credit facility after the repayment of the existing credit facility and reflecting a minimum liquidity covenant in the new credit facility, will enable it to fund its planned operating expenses, debt service obligations and capital expenditures at least through the next 12 months from the issuance date of these unaudited condensed consolidated financial statements. The future viability of the Company beyond that point is dependent on the Company’s ability to generate cash flows from the sale of DEXTENZA and raise additional capital to finance its operations. The Company will need to finance its operations through public or private securities offerings, debt financings, collaborations, strategic alliances, licensing agreements, royalty agreements, or marketing and distribution agreements. Although the Company has been successful in raising capital in the past, there is no assurance that it will be successful in obtaining such additional financing on terms acceptable to the Company, if at all. If the Company is unable to obtain funding, the Company could be forced to delay, reduce or eliminate some or all of its research and development programs for product candidates, product portfolio expansion or commercialization efforts, which could adversely affect its business prospects, or the Company may be unable to continue operations.

On June 30, 2023, the Company entered into an amendment to the Company's lease for its 20,445 square feet of manufacturing space located at 36 Crosby Drive in Bedford, Massachusetts. Under the amendment, the term of the lease was extended through July 31, 2028. The Company had reflected the obligations under the lease extension in its consolidated financial statements for 2022 as set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 6, 2023.

Risks and Fair Value - Concentration of Credit Risk (Details) - Customer - customer	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Total revenue
Concentration risk
Number of major customers		4	3	3
Total revenue \| Customer one
Concentration risk
Concentration risk	58.00%	41.00%	0.55%	0.41%
Total revenue \| Customer two
Concentration risk
Concentration risk	21.00%	26.00%	0.23%	0.25%
Total revenue \| Customer three
Concentration risk
Concentration risk	0.10%	0.17%	0.11%	0.20%
Total revenue \| Customer four
Concentration risk
Concentration risk		0.10%
Accounts receivable
Concentration risk
Number of major customers			3		3
Accounts receivable \| Customer one
Concentration risk
Concentration risk			59.00%		52.00%
Accounts receivable \| Customer two
Concentration risk
Concentration risk			22.00%		24.00%
Accounts receivable \| Customer three
Concentration risk
Concentration risk			10.00%		15.00%

Nature of the Business (Details) $ in Thousands	Aug. 07, 2023 USD ($)	Aug. 02, 2023 USD ($)	Jun. 30, 2023 USD ($) ft²	Dec. 31, 2022 USD ($)	Jun. 30, 2022 USD ($)
Nature of Business
Accumulated deficit			$ 667,842	$ 616,842
Cash and cash equivalents			$ 66,606	$ 102,300	$ 134,539
36 Crosby Drive in Bedford, Massachusetts
Nature of Business
Area of manufacturing space \| ft²			20,445
MidCap Credit Facility
Nature of Business
Borrowing capacity under the agreement			$ 25,000
Subsequent Event \| Barings Credit Facility
Nature of Business
Borrowing capacity under the agreement		$ 82,474
Principal amount of debt issued		82,474
Proceeds from issuance of debt, net		$ 77,790
Subsequent Event \| MidCap Credit Facility
Nature of Business
Repayment of debt including principal, interest, exit and prepayment fees	$ 26,157

Financial Liabilities - Convertible Notes, Other (Details) - Convertible Notes - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	Mar. 01, 2019
Convertible Notes
Principal amount of debt issued	$ 37,500	$ 37,500	$ 37,500
Interest rate (as a percent)			6.00%
Effective annual interest rate (as a percent)	14.80%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

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+ Details

Equity

6 Months Ended

Jun. 30, 2023

Equity

Equity

10. Equity

On August 9, 2021, the Company and Jefferies LLC (“Jefferies”) entered into an Open Market Sale Agreement (the “2021 Sales Agreement”) under which the Company may offer and sell shares of its common stock having an aggregate offering price of up to $100,000 from time to time through Jefferies, acting as agent. During the three and six months ended June 30, 2023, the Company sold 1,370,208 shares of common stock under the 2021 Sales Agreement, resulting in gross proceeds to the Company of $9,162, and net proceeds, after accounting for issuance costs, of $8,824. The Company did not offer or sell shares of its common stock under the 2021 Sales Agreement during the three and six months ended June 30, 2022.

- Definition

The entire disclosure for equity.

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+ Details

Subsequent Events

6 Months Ended

Jun. 30, 2023

Subsequent Events

Subsequent Events

16. Subsequent Events

The Company sold an additional 144,718 shares under the 2021 Sales Agreement through August 4, 2023, resulting in gross proceeds to the Company of $734, and net proceeds, after accounting for issuance costs, of $712.

On August 2, 2023 (the “Closing Date”), the Company entered into a credit and security agreement (the “Barings Credit Agreement”) with Barings Finance LLC (“Barings”), as administrative agent, and the lenders party thereto, providing for a secured term loan facility for the Company (the “Barings Credit Facility”) in the aggregate principal amount of $82,474 (the “Total Credit Facility Amount). The Company borrowed the full amount of $82,474 at closing and received proceeds of $77,790, after the application of a discount and fees. Indebtedness under the Barings Credit Facility matures on the earlier to occur of (i) the six-year anniversary of the Closing Date and (ii) the date that is 91 days prior to the maturity date for the Company’s Convertible Notes. Indebtedness under the Barings Credit Facility incurs interest at a SOFR-based rate, subject to a minimum 1.50% floor, plus 6.75%. The Company is obligated to make interest payments on its indebtedness under the Barings Credit Facility on a monthly basis, commencing on the Closing Date; to pay annual administration fees; and to pay, on the maturity date, any principal and accrued interest that remains outstanding as of such date. In addition, the Company is obligated to pay a fee in an amount equal to the Total Credit Facility Amount, which amount shall be reduced by the total amount of interest and principal prepayment fees paid under the Barings Credit Agreement (such fee, the “Royalty Fee”). The Company is required to pay the Royalty Fee in installments to Barings, for the benefit of the lenders, on a quarterly basis in an amount equal to three and one-half percent (3.5%) of the net sales of DEXTENZA occurring during such quarter, subject to the terms, conditions and limitations specified in the Barings Credit Agreement, until the Royalty Fee is paid in full. The Royalty Fee is due and payable upon a change of control of the Company. In the event the Company completes a change of control transaction on or prior to the twelve-month anniversary of the Closing Date, the Royalty Fee is subject to a reduction to an amount that is equal to (i) 20% of the Total Credit Facility Amount, in the event that a signed letter of intent evidencing such change of control transaction was entered into by the Company on or prior to the date that is six months after the Closing Date and (ii) 30% of the Total Credit Facility Amount, in the event that a signed letter of intent evidencing such change of control transaction was entered into by the Company after the date that is six months, but before the date that is twelve months, after the Closing Date. The Company may, at its option, prepay any or all of the Royalty Fee at any time without penalty. In connection with the Barings Credit Agreement, the Company granted the lenders thereto a first-priority security interest in all assets of the Company, including its intellectual property, subject to certain agreed-upon exceptions. The Barings Credit Agreement includes negative covenants restricting the Company from making payments to the holders of the Convertible Notes except in connection with a proposed conversion to equity and with respect to certain permitted expenses and requiring the Company to maintain a minimum liquidity amount of $20,000. The Barings Credit Agreement also includes customary affirmative and negative covenants.

Concurrently with entering into the Barings Credit Agreement, on August 2, 2023, the Company and the holders of the Convertible Notes (Note 7) extended the maturity of the Convertible Notes, which would otherwise have matured on March 1, 2026, to a date 91 days following the maturity of the indebtedness under the Barings Credit Facility.

An estimate of the impact of entering into the Barings Credit Agreement and extending the maturity of the Convertible Notes on the Company’s consolidated financial statements, including the impact on the Derivative Liability

(Note 8), cannot be made at this time, as the Company continues to determine the accounting for these transactions. The Company expects to finalize its accounting for these transactions during the third quarter of 2023.

In August 2023, in connection with the Company’s establishment of the Barings Credit Facility, the Company paid an aggregate of $26,157 to MidCap Financial Trust and the other lenders party to the MidCap Credit Agreement (Note 7), comprised of $25,017 in principal and interest accrued thereunder and $1,140 in exit and prepayment fees, in satisfaction of the Company’s obligations under the MidCap Credit Agreement. Upon the payment, all liens and security interests securing the indebtedness under the MidCap Credit Agreement were released. The prepayment of the MidCap Credit Facility has resulted in incremental expenses, including accrued interest, of $771, which will be charged to interest expense on the consolidated statements of operations and comprehensive loss for the third quarter of 2023.

Inventory

6 Months Ended

Jun. 30, 2023

Inventory

Inventory

5. Inventory

Inventory consisted of the following:


	June 30,		December 31,
	2023		2022
Raw materials	$	341	$	309
Work-in-process		682		899
Finished goods		1,181		766
	$	2,204	$	1,974

Net (Loss) Income Per Share - Basic (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022
Basic net loss per share attributable to common stockholders:
Net loss	$ (20,682)	$ (30,318)	$ (18,766)	$ (12,542)	$ (51,000)	$ (31,308)
Weighted average common shares outstanding, basic	78,047,705		76,764,296		77,718,823	76,755,028
Net loss per share, basic	$ (0.26)		$ (0.24)		$ (0.66)	$ (0.41)

- 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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+ Details

Equity - Additional information (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
	Aug. 09, 2021	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Common Stock
Net proceeds from issuance of common stock				$ 8,824
Common Stock
Common Stock
Number of shares issued		1,370,208
Common Stock \| 2021 Sales Agreement
Common Stock
Maximum aggregate proceeds from offering	$ 100,000
Number of shares issued		1,370,208	0	1,370,208	0
Gross proceeds		$ 9,162		$ 9,162
Net proceeds from issuance of common stock		$ 8,824		$ 8,824

- Definition

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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483014/272-10-45-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 272
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482987/272-10-50-1

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(d))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

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

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(27)(b))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480566/210-10-S99-1

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(28))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480566/210-10-S99-1

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

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(29))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480566/210-10-S99-1

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 3
-Subparagraph (SX 210.6-03(i)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479886/946-10-S99-3

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Section S99
-Paragraph 3
-Subparagraph (SX 210.6-03(i)(1))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479886/946-10-S99-3

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Name Accounting Standards Codification
-Section S99
-Paragraph 3
-Subparagraph (SX 210.6-03(i)(2)(i))
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Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 3
-Subparagraph (SX 210.6-03(i)(2)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479886/946-10-S99-3

+ Details

Cash Equivalents and Restricted Cash

6 Months Ended

Jun. 30, 2023

Cash Equivalents and Restricted Cash

Cash Equivalents and Restricted Cash

4. Cash Equivalents and Restricted Cash

As of June 30, 2023 and December 31, 2022, the Company held restricted cash of $1,764, respectively, on its unaudited condensed consolidated balance sheets. The Company held restricted cash as security deposits for its real estate leases.

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


	June 30,		June 30,
	2023		2022
Cash and cash equivalents	$	66,606	$	134,539
Restricted cash		1,764		1,764
Total cash, cash equivalents and restricted cash	$	68,370	$	136,303

Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Related Party Transactions
Accounts payable	$ 3,572		$ 3,572		$ 5,123
Accrued expenses	24,598		24,598		24,097
WilmerHale \| Legal Fees. \| Chief Business Officer
Related Party Transactions
Expenses incurred	239	$ 211	633	$ 535
Accounts payable	95		95		0
Accrued expenses	$ 122		$ 122		$ 24

Risks and Fair Value (Tables)

6 Months Ended

Jun. 30, 2023

Risks and Fair Value

Schedule of assets and liabilities measured at fair Value on recurring basis


	Fair Value Measurements as of
	June 30, 2023 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	56,550	$	—	$	—	$	56,550

Liability:
Derivative liability	$	—	$	—	$	11,783	$	11,783


	Fair Value Measurements as of
	December 31, 2022 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	30,188	$	—	$	—	$	30,188

Liability:
Derivative liability	$	—	$	—	$	6,351	$	6,351

Schedule of main inputs to valuing the 2026 Convertible Notes with the conversion option


		As of
	June 30,			December 31,
	2023			2022
Company's stock price	$	5.16		$	2.81
Volatility		78.9	%		93.8	%
Bond yield		14.8	%		16.2	%

Summary of roll-forward of the derivative liability


	As of
Balance at December 31, 2022	$	6,351
Change in fair value		5,432
Balance at June 30, 2023	$	11,783

- Definition

Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item.

+ References + Details

Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2023

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The significant accounting policies used in preparation of these unaudited condensed consolidated financial statements are consistent with those described in Note 2 - Summary of Significant Accounting Policies in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the Securities and Exchange Commission (“SEC”) on March 6, 2023.

Use of Estimates

The preparation of these unaudited condensed consolidated 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 at the date of these unaudited condensed consolidated financial statements, and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions reflected in these unaudited condensed consolidated financial statements include, but are not limited to, the measurement and recognition of reserves for variable consideration related to product sales, revenue recognition related to a collaboration agreement that contains multiple promises, the fair value of derivatives, stock-based compensation, and realizability of net deferred tax assets. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Actual results could differ from the Company’s estimates.

Unaudited Interim Financial Information

The balance sheet at December 31, 2022 was derived from audited consolidated financial statements but does not include all disclosures required by GAAP. The accompanying unaudited condensed consolidated financial statements as of June 30, 2023 and for the three and six months ended June 30, 2023 and 2022 have been prepared by the Company, pursuant to the rules and regulations of the 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 unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and the notes thereto for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 6, 2023. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s financial position as of June 30, 2023 and results of operations and cash flows for the three and six months ended June 30, 2023 and 2022 have been made. The results of operations for the three and six months ended June 30, 2023 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2023.

Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB and adopted by us as of the specified effective date. The Company believes that recently issued accounting pronouncements that are not yet effective will not have a material impact on our consolidated financial statements and disclosures.

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Total
Balance at Dec. 31, 2021	$ 8	$ 633,795	$ (545,804)	$ 87,999
Balance, shares at Dec. 31, 2021	76,731,940
Stockholders' Equity (Deficit)
Issuance of common stock upon exercise of stock options		129		129
Issuance of common stock upon exercise of stock options, shares	27,674
Stock-based compensation expense		4,209		4,209
Net loss			(12,542)	(12,542)
Balance at Mar. 31, 2022	$ 8	638,133	(558,346)	79,795
Balance, shares at Mar. 31, 2022	76,759,614
Balance at Dec. 31, 2021	$ 8	633,795	(545,804)	87,999
Balance, shares at Dec. 31, 2021	76,731,940
Stockholders' Equity (Deficit)
Net loss				(31,308)
Balance at Jun. 30, 2022	$ 8	642,907	(577,112)	65,803
Balance, shares at Jun. 30, 2022	76,910,026
Balance at Mar. 31, 2022	$ 8	638,133	(558,346)	79,795
Balance, shares at Mar. 31, 2022	76,759,614
Stockholders' Equity (Deficit)
Issuance of common stock upon exercise of stock options		11		11
Issuance of common stock upon exercise of stock options, shares	9,469
Issuance of common stock in connection with employee stock purchase plan		482		482
Issuance of common stock in connection with employee stock purchase plan, shares	140,943
Stock-based compensation expense		4,281		4,281
Net loss			(18,766)	(18,766)
Balance at Jun. 30, 2022	$ 8	642,907	(577,112)	65,803
Balance, shares at Jun. 30, 2022	76,910,026
Balance at Dec. 31, 2022	$ 8	652,213	(616,842)	35,379
Balance, shares at Dec. 31, 2022	77,201,819
Stockholders' Equity (Deficit)
Issuance of common stock upon exercise of stock options		78		78
Issuance of common stock upon exercise of stock options, shares	26,443
Issuance of common stock upon vesting of restricted stock units (in shares)	288,376
Stock-based compensation expense		4,572		4,572
Net loss			(30,318)	(30,318)
Balance at Mar. 31, 2023	$ 8	656,863	(647,160)	9,711
Balance, shares at Mar. 31, 2023	77,516,638
Balance at Dec. 31, 2022	$ 8	652,213	(616,842)	35,379
Balance, shares at Dec. 31, 2022	77,201,819
Stockholders' Equity (Deficit)
Net loss				(51,000)
Balance at Jun. 30, 2023	$ 8	670,921	(667,842)	3,087
Balance, shares at Jun. 30, 2023	79,233,804
Balance at Mar. 31, 2023	$ 8	656,863	(647,160)	9,711
Balance, shares at Mar. 31, 2023	77,516,638
Stockholders' Equity (Deficit)
Issuance of common stock upon exercise of stock options		403		403
Issuance of common stock upon exercise of stock options, shares	97,435
Issuance of common stock in connection with employee stock purchase plan		418		418
Issuance of common stock in connection with employee stock purchase plan, shares	176,406
Issuance of common stock upon vesting of restricted stock units (in shares)	73,117
Issuance of common stock upon public offering, net of issuance costs		8,824		8,824
Issuance of common stock upon public offering, net of issuance costs, shares	1,370,208
Stock-based compensation expense		4,413		4,413
Net loss			(20,682)	(20,682)
Balance at Jun. 30, 2023	$ 8	$ 670,921	$ (667,842)	$ 3,087
Balance, shares at Jun. 30, 2023	79,233,804

Net Loss Per Share - Schedule of Antidilutive Securities, Excluded from Computation of Diluted Net Loss per Share (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total common stock equivalents	23,757,619	14,909,995	23,757,619	14,909,995
Options to Purchase Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total common stock equivalents	16,333,870	13,892,884	16,333,870	13,892,884
Restricted Stock Units (RSUs)
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total common stock equivalents	1,654,517	1,017,111	1,654,517	1,017,111
Convertible Notes
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total common stock equivalents	5,769,232		5,769,232

Income Taxes

6 Months Ended

Jun. 30, 2023

Income Taxes

Income Taxes

12. Income Taxes

The Company did not provide for any income taxes in its unaudited condensed consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2023 and 2022, respectively. The Company has provided a valuation allowance for the full amount of its net deferred tax assets because, at June 30, 2023 and December 31, 2022, it was more likely than not that any future benefit from deductible temporary differences and net operating loss and tax credit carryforwards would not be realized.

- Definition

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

+ References

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

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

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

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

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

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

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

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

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

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

+ Details

Financial Liabilities - Notes Payable, Borrowings Outstanding (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Notes Payable
Less: current portion	$ (2,083)
Long-term notes payable	23,303	$ 25,257
MidCap Credit Facility
Notes Payable
Borrowings outstanding	25,000	25,000
Accrued exit fee	448	335
Unamortized discount	(62)	(78)
Borrowings	25,386	25,257
Less: current portion	(2,083)
Long-term notes payable	$ 23,303	$ 25,257

Summary of Significant Accounting Policies (Policies)	6 Months Ended
Summary of Significant Accounting Policies (Policies)	Jun. 30, 2023
Summary of Significant Accounting Policies
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The significant accounting policies used in preparation of these unaudited condensed consolidated financial statements are consistent with those described in Note 2 - Summary of Significant Accounting Policies in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the Securities and Exchange Commission (“SEC”) on March 6, 2023.
Use of Estimates	Use of Estimates The preparation of these unaudited condensed consolidated 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 at the date of these unaudited condensed consolidated financial statements, and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions reflected in these unaudited condensed consolidated financial statements include, but are not limited to, the measurement and recognition of reserves for variable consideration related to product sales, revenue recognition related to a collaboration agreement that contains multiple promises, the fair value of derivatives, stock-based compensation, and realizability of net deferred tax assets. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Actual results could differ from the Company’s estimates.
Unaudited Interim Financial Information	Unaudited Interim Financial Information The balance sheet at December 31, 2022 was derived from audited consolidated financial statements but does not include all disclosures required by GAAP. The accompanying unaudited condensed consolidated financial statements as of June 30, 2023 and for the three and six months ended June 30, 2023 and 2022 have been prepared by the Company, pursuant to the rules and regulations of the 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 unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and the notes thereto for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 6, 2023. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s financial position as of June 30, 2023 and results of operations and cash flows for the three and six months ended June 30, 2023 and 2022 have been made. The results of operations for the three and six months ended June 30, 2023 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2023.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB and adopted by us as of the specified effective date. The Company believes that recently issued accounting pronouncements that are not yet effective will not have a material impact on our consolidated financial statements and disclosures.

Expenses

6 Months Ended

Jun. 30, 2023

Expenses

Expenses

6. Expenses

Accrued expenses and other current liabilities consisted of the following:


	June 30,		December 31,
	2023		2022
Accrued payroll and related expenses	$	6,236	$	7,509
Accrued rebates and programs		4,513		3,560
Accrued professional fees		1,387		1,228
Accrued research and development expenses		1,523		1,816
Accrued interest payable on Convertible Notes		9,752		8,756
Accrued other		1,187		1,228
	$	24,598	$	24,097

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Revenue:
Total revenue, net	$ 15,186	$ 12,266	$ 28,561	$ 25,453
Costs and operating expenses:
Cost, Product and Service [Extensible List]	Product	Product	Product	Product
Cost of product revenue	$ 1,304	$ 1,155	$ 2,517	$ 2,454
Research and development	15,094	13,100	29,842	26,200
Selling and marketing	11,153	10,140	21,989	19,203
General and administrative	8,205	7,787	17,332	15,344
Total costs and operating expenses	35,756	32,182	71,680	63,201
Loss from operations	(20,570)	(19,916)	(43,119)	(37,748)
Other income (expense):
Interest income	748	73	1,312	89
Interest expense	(1,991)	(1,696)	(3,760)	(3,378)
Change in fair value of derivative liability	1,131	2,773	(5,432)	9,731
Other expense, net			(1)	(2)
Total other (expense) income, net	(112)	1,150	(7,881)	6,440
Net loss	$ (20,682)	$ (18,766)	$ (51,000)	$ (31,308)
Net loss per share, basic	$ (0.26)	$ (0.24)	$ (0.66)	$ (0.41)
Weighted average common shares outstanding, basic	78,047,705	76,764,296	77,718,823	76,755,028
Net loss per share, diluted	$ (0.26)	$ (0.25)	$ (0.66)	$ (0.47)
Weighted average common shares outstanding, diluted	78,047,705	82,533,528	77,718,823	82,524,260
Product
Revenue:
Total revenue, net	$ 15,029	$ 12,144	$ 28,243	$ 24,642
Collaboration revenue
Revenue:
Total revenue, net	$ 157	$ 122	$ 318	$ 811

Financial Liabilities - Notes Payable, Annual Repayments (Details) - MidCap Credit Facility $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($)
Annual repayment requirements
Principal	$ 25,000
Final Payment	875
Total	25,875
2024
Annual repayment requirements
Principal	8,333
Total	8,333
2025
Annual repayment requirements
Principal	16,667
Final Payment	875
Total	$ 17,542

Licensing Agreements and Deferred Revenue (Tables)

6 Months Ended

Jun. 30, 2023

Licensing Agreements and Deferred Revenue

Schedule of deferred revenue



	Deferred Revenue
Deferred revenue at December 31, 2022	$	13,963
Additions		1,000
Amounts recognized into revenue		(318)
Deferred revenue at June 30, 2023	$	14,645

Stock-Based Awards - Additional Information (Details) - $ / shares	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023	Jun. 14, 2023
Stock-Based Awards
Stock options and RSUs expired or were forfeited (in shares)	428,860	560,207
Common Stock
Stock-Based Awards
Issuance of common stock upon public offering, net of issuance costs, shares	1,370,208
2021 Incentive Plan
Stock-Based Awards
Number of shares of common stock available for issuance	6,051,809	6,051,809	3,900,000
2021 Incentive Plan \| Common Stock
Stock-Based Awards
Shares issuable under options, granted (in shares)	249,600	3,240,741
Exercise price (in dollars per share)	$ 5.46	$ 4.01
2019 Inducement Plan
Stock-Based Awards
Number of shares of common stock available for issuance	545,375	545,375
2014 Employee Stock Purchase Plan
Stock-Based Awards
Number of shares of common stock available for issuance	513,069	513,069
Restricted Stock Units (RSUs) \| 2021 Incentive Plan
Stock-Based Awards
Granted (in shares)	83,198	1,030,831

Financial Liabilities - Convertible Notes, Summary (Details) - Convertible Notes - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	Mar. 01, 2019
Convertible Notes
Convertible Notes	$ 37,500	$ 37,500	$ 37,500
Less: unamortized discount	(7,519)	(8,751)
Convertible notes at amortized cost	$ 29,981	$ 28,749

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

Financial Liabilities - Notes Payable, Additional Information (Details) - USD ($) $ in Thousands			1 Months Ended	6 Months Ended
	May 04, 2023	Mar. 12, 2023	Mar. 31, 2023	Jun. 30, 2023
Notes Payable
Protective advance requested under Credit Agreement representing a short-term bridge loan				$ 2,000
Repayment of protective advance				2,000
MidCap Credit Facility
Notes Payable
Borrowing capacity under the agreement				$ 25,000
Protective advance requested under Credit Agreement representing a short-term bridge loan		$ 2,000
Repayment of protective advance			$ 2,000
MidCap Credit Facility \| Maximum
Notes Payable
Threshold percent of cash and cash equivalents to be maintained under debt agreement	50.00%

Stock-Based Awards (Tables)

6 Months Ended

Jun. 30, 2023

Stock-Based Awards

Schedule of stock-based compensation expense related to stock options


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Research and development	$	1,133	$	1,036	$	2,274	$	2,098
Selling and marketing		970		1,191		2,014		2,329
General and administrative		2,310		2,054		4,697		4,063
	$	4,413	$	4,281	$	8,985	$	8,490

Expenses (Tables)

6 Months Ended

Jun. 30, 2023

Expenses

Schedule of accrued expenses


	June 30,		December 31,
	2023		2022
Accrued payroll and related expenses	$	6,236	$	7,509
Accrued rebates and programs		4,513		3,560
Accrued professional fees		1,387		1,228
Accrued research and development expenses		1,523		1,816
Accrued interest payable on Convertible Notes		9,752		8,756
Accrued other		1,187		1,228
	$	24,598	$	24,097

Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022	Dec. 31, 2021
Cash Equivalents and Restricted Cash
Cash and cash equivalents	$ 66,606	$ 102,300	$ 134,539
Restricted cash	1,764	1,764	1,764
Total cash, cash equivalents and restricted cash as shown on the statements of cash flows	$ 68,370	$ 104,064	$ 136,303	$ 165,928

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 66,606	$ 102,300
Accounts receivable, net	27,309	21,325
Inventory	2,204	1,974
Prepaid expenses and other current assets	4,593	4,028
Total current assets	100,712	129,627
Property and equipment, net	12,830	9,856
Restricted cash	1,764	1,764
Operating lease assets	7,252	8,042
Total assets	122,558	149,289
Current liabilities:
Accounts payable	3,572	5,123
Accrued expenses and other current liabilities	24,598	24,097
Deferred revenue	391	576
Operating lease liabilities	1,713	1,599
Notes payable, net of discount, current	2,083
Total current liabilities	32,357	31,395
Other liabilities:
Operating lease liabilities, net of current portion	7,689	8,678
Derivative liability	11,783	6,351
Deferred revenue, net of current portion	14,254	13,387
Notes payable, net of discount, net of current portion	23,303	25,257
Other non-current liabilities	104	93
Convertible Notes, net	29,981	28,749
Total liabilities	119,471	113,910
Commitments and contingencies (Note 14)
Stockholders' equity:
Preferred stock, $0.0001 par value; 5,000,000 shares authorized and no shares issued or outstanding at June 30, 2023 and December 31, 2022, respectively
Common stock, $0.0001 par value; 200,000,000 shares authorized and 79,233,804 and 77,201,819 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively	8	8
Additional paid-in capital	670,921	652,213
Accumulated deficit	(667,842)	(616,842)
Total stockholders' equity	3,087	35,379
Total liabilities and stockholders' equity	$ 122,558	$ 149,289

Financial Liabilities

6 Months Ended

Jun. 30, 2023

Financial Liabilities

Financial Liabilities

7. Financial Liabilities

Convertible Notes

On March 1, 2019, the Company issued $37,500 of convertible notes, which accrue interest at an annual rate of 6% of their outstanding principal amount, which is payable, along with the principal amount at maturity, on March 1, 2026, unless earlier converted, repurchased or redeemed (the “Convertible Notes”). The Company presents accrued interest in accrued expenses and other current liabilities on the unaudited condensed consolidated balance sheets because the Convertible Notes are currently convertible and the interest is payable in cash. The effective annual interest rate for the Convertible Notes was 14.8% through June 30, 2023.

The terms and conditions of the Convertible Notes were amended on August 2, 2023 (Note 16). The terms and conditions of the Convertible Notes prior to the amendment are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 6, 2023.

The Company determined that the embedded conversion option is required to be separated from the Convertible Notes and accounted for as a freestanding derivative instrument subject to derivative accounting. The allocation of proceeds to the conversion option results in a discount on the Convertible Notes. The Company is amortizing the discount to interest expense over the term of the Convertible Notes using the effective interest method.

A summary of the Convertible Notes at June 30, 2023 and December 31, 2022 is as follows:


	June 30,		December 31,
	2023		2022
Convertible Notes	$	37,500	$	37,500
Less: unamortized discount		(7,519)		(8,751)
Total	$	29,981	$	28,749

Notes Payable

The Company entered into a credit and security agreement in 2014 (as amended to date, the “MidCap Credit Agreement”) establishing a credit facility (the “MidCap Credit Facility”). The terms and conditions of the MidCap Credit Agreement and the MidCap Credit Facility are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 6, 2023, except with respect to Amendments No. 1 and 2 to the MidCap Credit Agreement as described below. The MidCap Credit Facility was paid off in full in August 2023 (Note 16).

Under the MidCap Credit Facility, the Company had a total borrowing capacity of $25,000, which was fully drawn down as of June 30, 2023. The carrying value of the Company’s variable interest rate notes payable under the MidCap Credit Facility are recorded at amortized cost, which approximates fair value due to their short-term nature.

On March 12, 2023, the Company requested, and received, a protective advance of $2,000 under the MidCap Credit Agreement as a short-term bridge loan in response to the closure of Silicon Valley Bank by the California Department of Financial Protection and Innovation. This protective advance was deemed a credit extension. The Company repaid the full principal amount of $2,000 in March 2023.

On March 31, 2023, the Company entered into Amendment No. 1 to the MidCap Credit Agreement (“Amendment No. 1”) to replace the LIBOR-based interest rate provisions of the MidCap Credit Agreement with interest rate provisions based on the Secured Overnight Financing Rate (“SOFR”), establish a benchmark replacement mechanism and make additional administrative updates. The Company accounted for Amendment No. 1 as a modification in accordance with the guidance in ASC 470-50 Debt. Application of the modification accounting guidance did not have a material effect on the carrying amount of the long-term notes payable.

On May 4, 2023, the Company entered into Amendment No. 2 to the MidCap Credit Agreement (“Amendment No. 2”). Amendment No. 2 provided that the Company may maintain up to 50% of its consolidated cash and cash equivalents with banks or financial institutions other than Silicon Valley Bank and made additional administrative updates.

Borrowings outstanding are as follows:


	June 30,		December 31,
	2023		2022
Borrowings outstanding	$	25,000	$	25,000
Accrued exit fee		448		335
Unamortized discount		(62)		(78)
		25,386		25,257
Less: current portion		(2,083)		—
Long-term notes payable	$	23,303	$	25,257

As of June 30, 2023, the annual requirement for the repayment of principal for the MidCap Credit Facility, inclusive of the final payment of $875 due at expiration, was as follows:




Year Ending December 31,	Principal		Final Payment		Total
2024		8,333		—		8,333
2025		16,667		875		17,542
	$	25,000	$	875	$	25,875

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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+ Details

Net Loss Per Share - Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Reconciliation of net loss attributable to common stockholders for basic and diluted net loss per share
Net loss attributable to common stockholders, basic		$ (18,766)		$ (31,308)
Interest expense Convertible Notes		1,141		2,264
Change in fair value of derivative liability		(2,773)		(9,731)
Net loss attributable to common stockholders, diluted		$ (20,398)		$ (38,775)
Weighted average common shares outstanding, basic	78,047,705	76,764,296	77,718,823	76,755,028
Shares issuable upon conversion of Convertible Notes, as if converted		5,769,232		5,769,232
Weighted average common shares outstanding, diluted	78,047,705	82,533,528	77,718,823	82,524,260
Net loss per share attributable to common stockholders, diluted	$ (0.26)	$ (0.25)	$ (0.66)	$ (0.47)

- Definition

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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Amount, after deduction of tax, noncontrolling interests, dividends on preferred stock and participating securities; of income (loss) available to common shareholders.

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- Definition

Amount, after deduction of tax, noncontrolling interests, dividends on preferred stock and participating securities, and addition from assumption of issuance of common shares for dilutive potential common shares; of income (loss) available to common shareholders.

+ References + Details

Commitments and Contingencies

6 Months Ended

Jun. 30, 2023

Commitments and Contingencies.

Commitments and Contingencies

14. Commitments and Contingencies

Indemnification Agreements

In the ordinary course of business, the Company enters into agreements that may include indemnification provisions. Pursuant to such agreements, the Company may indemnify, hold harmless and defend indemnified parties for losses suffered or incurred by the indemnified party. Some of the provisions will limit losses to those arising from third-party actions. In some cases, the indemnification will continue after the termination of the agreement. The maximum

potential amount of future payments the Company could be required to make under these provisions is not determinable. To date, the Company has not incurred any material costs as a result of such indemnifications.

Risks and Fair Value - Derivative Roll-Forward (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($)
Roll forward of the derivative liability
Balance at beginning of period	$ 6,351
Change in fair value	5,432
Balance at end of period	$ 11,783

- Definition

Fair value, after the effects of master netting arrangements, of a financial liability or contract with one or more underlyings, notional amount or payment provision or both, and the contract can be net settled by means outside the contract or delivery of an asset. Includes liabilities not subject to a master netting arrangement and not elected to be offset.

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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Financial Liabilities (Tables)

6 Months Ended

Jun. 30, 2023

Financial Liabilities

Summary of the 2026 Convertible Notes

A summary of the Convertible Notes at June 30, 2023 and December 31, 2022 is as follows:


	June 30,		December 31,
	2023		2022
Convertible Notes	$	37,500	$	37,500
Less: unamortized discount		(7,519)		(8,751)
Total	$	29,981	$	28,749

Schedule of borrowings outstanding


	June 30,		December 31,
	2023		2022
Borrowings outstanding	$	25,000	$	25,000
Accrued exit fee		448		335
Unamortized discount		(62)		(78)
		25,386		25,257
Less: current portion		(2,083)		—
Long-term notes payable	$	23,303	$	25,257

Schedule of annual repayment requirements for MidCap Credit Facility




Year Ending December 31,	Principal		Final Payment		Total
2024		8,333		—		8,333
2025		16,667		875		17,542
	$	25,000	$	875	$	25,875

Risks and Fair Value - Fair Value Measurement (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Liability:
Derivative liability	$ 11,783	$ 6,351
Non-current liability	29,981	28,749
Accrued interest payable on Convertible Notes	9,752	8,756
Convertible Notes
Liability:
Convertible debt, amortized cost, including accrued interest	39,733	37,505
Non-current liability	29,981	28,749
Accrued interest payable on Convertible Notes	9,752	8,756
Estimated fair value	36,816	33,177
Recurring Basis
Liability:
Derivative liability	11,783	6,351
Money Market Funds \| Recurring Basis
Assets:
Cash equivalents	56,550	30,188
Level 1 \| Money Market Funds \| Recurring Basis
Assets:
Cash equivalents	56,550	30,188
Level 3 \| Recurring Basis
Liability:
Derivative liability	$ 11,783	$ 6,351

Risks and Fair Value

6 Months Ended

Jun. 30, 2023

Risks and Fair Value

Risks and Fair Value

9. Risks and Fair Value

Concentration of Credit Risk and of Significant Suppliers and Customers

Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company has its cash and cash equivalents balances at two accredited financial institutions, in amounts that exceed federally insured limits. The Company does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships.

The Company is dependent on a small number of third-party manufacturers to supply products for research and development activities in its preclinical and clinical programs and for sales of its products. The Company’s development programs as well as revenue from future product sales could be adversely affected by a significant interruption in the supply of any of the components of these products.

For the three and six months ended June 30, 2023, three specialty distributor customers accounted for 58%, 21% and 10%, and 55%, 23%, and 11%, respectively, of the Company’s gross product revenue, and at June 30, 2023, three specialty distributor customers accounted for 59%, 22%, and 10% of the Company’s total accounts receivable. No other customer accounted for more than 10% of total revenue for the three and six months ended June 30, 2023, or accounts receivable at June 30, 2023.

For the three and six months ended June 30, 2022, four specialty distributor customers accounted for 41%, 26%, 17%, and 10%, and three specialty distributors accounted for 41%, 25% and 20%, respectively, of the Company’s gross product revenue. At December 31, 2022, three specialty distributor customers accounted for 52%, 24%, and 15% of the Company’s total accounts receivable. No other customer accounted for more than 10% of total revenue for the three and six months ended June 30, 2022, or accounts receivable at December 31, 2022.

Fair Value of Financial Assets and Liabilities

The following tables present information about the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2023 and December 31, 2022 and indicate the level of the fair value hierarchy utilized to determine such fair value:


	Fair Value Measurements as of
	June 30, 2023 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	56,550	$	—	$	—	$	56,550

Liability:
Derivative liability	$	—	$	—	$	11,783	$	11,783


	Fair Value Measurements as of
	December 31, 2022 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	30,188	$	—	$	—	$	30,188

Liability:
Derivative liability	$	—	$	—	$	6,351	$	6,351

At June 30, 2023, the Convertible Notes, net of the Derivative Liability, were carried at amortized cost totaling $39,733, comprised of the $29,981 non-current liability (Note 7) and $9,752 accrued interest (Note 6). At December 31, 2022, the Convertible Notes, net of the Derivative Liability, were carried at amortized cost totaling $37,505, comprised of the $28,749 non-current liability (Note 7) and $8,756 accrued interest (Note 6). The estimated fair value of the Convertible Notes, without the Derivative Liability, was $36,816 and $33,177 at June 30, 2023 and December 31, 2022, respectively.

The fair value of the Convertible Notes with and without the conversion option is estimated using a binomial lattice approach. The use of this approach requires the use of Level 3 unobservable inputs. The main input when determining the fair value of the Convertible Notes is the bond yield that pertains to the host instrument without the conversion option. The significant assumption used in determining the bond yield is the market yield movements of a comparable instrument issued as of the valuation date, which is assessed and updated each period. The main input when determining the fair value for disclosure purposes is the bond yield which is updated each period to reflect the yield of a comparable instrument issued as of the valuation date. The estimated fair value presented is not necessarily indicative of an amount that could be realized in a current market exchange. The use of alternative inputs and estimation methodologies could have a material effect on these estimates of fair value.

The main inputs to valuing the Convertible Notes with the conversion option are as follows:


		As of
	June 30,			December 31,
	2023			2022
Company's stock price	$	5.16		$	2.81
Volatility		78.9	%		93.8	%
Bond yield		14.8	%		16.2	%

A roll-forward of the derivative liability is as follows:


	As of
Balance at December 31, 2022	$	6,351
Change in fair value		5,432
Balance at June 30, 2023	$	11,783

Risks and Fair Value - Measurement inputs (Details) - Convertible Notes	Jun. 30, 2023	Dec. 31, 2022
Company's stock price
Derivative Liability
Debt instrument, measurement input	5.16	2.81
Volatility
Derivative Liability
Debt instrument, measurement input	0.789	0.938
Bond yield
Derivative Liability
Debt instrument, measurement input	0.148	0.162

Expenses - Summary (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Expenses
Accrued payroll and related expenses	$ 6,236	$ 7,509
Accrued rebates and programs	4,513	3,560
Accrued professional fees	1,387	1,228
Accrued research and development expenses	1,523	1,816
Accrued interest payable on Convertible Notes	9,752	8,756
Accrued other	1,187	1,228
Total	$ 24,598	$ 24,097

Licensing Agreements and Deferred Revenue

6 Months Ended

Jun. 30, 2023

Licensing Agreements and Deferred Revenue

Licensing Agreements and Deferred Revenue

3. Licensing Agreements and Deferred Revenue

Incept License Agreement (in-licensing)

On September 13, 2018, the Company entered into a second amended and restated license agreement with Incept, LLC (“Incept”) to use and develop certain intellectual property (the “Incept License”). Under the Incept License, as

amended and restated, the Company was granted a worldwide, perpetual, exclusive license to use specific Incept technology to develop and commercialize products that are delivered to or around the human eye for diagnostic, therapeutic or prophylactic purposes relating to ophthalmic diseases or conditions. The Company is obligated to pay low single-digit royalties on net sales of commercial products developed using the licensed technology, commencing with the date of the first commercial sale of such products and until the expiration of the last to expire of the patents covered by the license.

The terms and conditions of the Incept License are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 6, 2023.

Royalties paid under this agreement related to product sales were $396 and $813 for the three and six months ended June 30, 2023, respectively, and $375 and $744 for the three and six months ended June 30, 2022, respectively. Royalties have been charged to cost of product revenue.

AffaMed License Agreement (out-licensing)

On October 29, 2020, the Company entered into license agreement (“License Agreement”) with AffaMed Therapeutic Limited (“AffaMed”) for the development and commercialization of the Company’s DEXTENZA product regarding ocular inflammation and pain following cataract surgery and allergic conjunctivitis and for the Company’s OTX-TIC product candidate regarding open-angle glaucoma or ocular hypertension, in each case in mainland China, Taiwan, Hong Kong, Macau, South Korea, and the countries of the Association of Southeast Asian Nations. The Company retains development and commercialization rights for the AffaMed Licensed Products in the rest of the world.

The terms and conditions of the License Agreement are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 6, 2023.

In June 2023, the Company received a milestone payment of $1,000 from AffaMed in connection with AffaMed receiving approval of its Clinical Trial Application to initiate a Phase 3 registrational study in China to investigate the efficacy and safety of DEXTENZA in subjects following ophthalmic surgery by China’s National Medical Products Administration. The Company has allocated the amount to the DEXTENZA Field performance obligation as an addition to deferred revenue.

In March 2022, the Company invoiced AffaMed $2,000 for a clinical trial support payment in connection with the initiation by the Company of the OTX-TIC Phase 2 clinical trial and allocated the amount to the Phase 2 Clinical Trial of OTX-TIC performance obligation as an addition to deferred revenue. Payment was received by the Company during the three months ended June 30, 2022.

The Company recognized collaboration revenue related to the Phase 2 Clinical Trial of OTX-TIC performance obligation of $157 and $318 for the three and six months ended June 30, 2023, respectively, and $122 and $811 for the three and six months ended June 30, 2022, respectively.

As of June 30, 2023, the aggregate amount of the transaction price allocated to the partially unsatisfied Phase 2 Clinical Trial of OTX-TIC performance obligation was $645. This amount is expected to be recognized as this performance obligation is satisfied through June 2025.

Deferred revenue activity for the three and six months ended June 30, 2023 was as follows:



	Deferred Revenue
Deferred revenue at December 31, 2022	$	13,963
Additions		1,000
Amounts recognized into revenue		(318)
Deferred revenue at June 30, 2023	$	14,645

Related Party Transactions

6 Months Ended

Jun. 30, 2023

Related Party Transactions

Related Party Transactions

15. Related Party Transactions

The Company has engaged Wilmer Cutler Pickering Hale and Dorr LLP (“WilmerHale”) to provide certain legal services to the Company. The Company's Chief Business Officer’s sister is a managing partner at WilmerHale, who has not participated in providing legal services to the Company. The Company incurred fees for legal services rendered by WilmerHale of approximately $239 and $633 for the three and six months ended June 30, 2023, respectively, and approximately $211 and $535 for the three and six months ended June 30, 2022, respectively. As of June 30, 2023 and December 31, 2022, there was $95 and $0 recorded in accounts payable for WilmerHale. As of June 30, 2023 and December 31, 2022, there was $122 and $24 recorded in accrued expenses for WilmerHale.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 5
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-5

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-6

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

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

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(g)(3))
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(e))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//850/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-6

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
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-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

+ Details

Inventory (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Inventory
Raw materials	$ 341	$ 309
Work-in-process	682	899
Finished goods	1,181	766
Total inventory	$ 2,204	$ 1,974

Net Loss Per Share

6 Months Ended

Jun. 30, 2023

Net Loss Per Share

Net Loss Per Share

13. Net Loss Per Share

Basic net loss per share was calculated as follows for the three and six months ended June 30, 2023 and 2022:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023			2022	2023			2022
Numerator:
Net loss attributable to common stockholders	$	(20,682)	$	(18,766)	$	(51,000)	$	(31,308)
Denominator:
Weighted average common shares outstanding, basic		78,047,705		76,764,296		77,718,823		76,755,028
Net loss per share - basic	$	(0.26)	$	(0.24)	$	(0.66)	$	(0.41)


		Three Months Ended June 30,	Six Months Ended June 30,
		2022		2022
Net loss attributable to common stockholders, basic	$	(18,766)	$	(31,308)
Interest expense on Convertible Notes		1,141		2,264
Change in fair value of derivative liability		(2,773)		(9,731)
Net loss attributable to common stockholders, diluted	$	(20,398)	$	(38,775)

Weighted average common shares outstanding, basic		76,764,296		76,755,028
Shares issuable upon conversion of Convertible Notes, as if converted		5,769,232		5,769,232
Weighted average common shares outstanding, diluted		82,533,528		82,524,260

Net loss per share attributable to common stockholders, diluted	$	(0.25)	$	(0.47)

The Company excluded the following potentially issuable common shares, outstanding as of June 30, 2023 and 2022, from the computation of diluted net loss per share for the three and six months ended June 30, 2023 and 2022 because they had an anti-dilutive impact.


	Three Months Ended June 30,		Six Months Ended June 30,
	2023	2022	2023	2022
Options to purchase common stock	16,333,870	13,892,884	16,333,870	13,892,884
Restricted stock units	1,654,517	1,017,111	1,654,517	1,017,111
Shares issuable upon conversion of Convertible Notes, if converted	5,769,232	—	5,769,232	—
	23,757,619	14,909,995	23,757,619	14,909,995

Inventory (Tables)

6 Months Ended

Jun. 30, 2023

Inventory

Components of inventory


	June 30,		December 31,
	2023		2022
Raw materials	$	341	$	309
Work-in-process		682		899
Finished goods		1,181		766
	$	2,204	$	1,974

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash flows from operating activities:
Net loss	$ (51,000)	$ (31,308)
Adjustments to reconcile net loss to net cash used in operating activities
Stock-based compensation expense	8,985	8,490
Non-cash interest expense	2,481	2,391
Change in fair value of derivative liability	5,432	(9,731)
Depreciation and amortization expense	1,135	1,109
Gain (loss) on disposal of property and equipment	(1)	2
Changes in operating assets and liabilities:
Accounts receivable	(5,984)	653
Prepaid expenses and other current assets	(565)	950
Inventory	(230)	(250)
Accounts payable	(320)	(809)
Operating lease assets and liabilities	(85)	(216)
Accrued expenses	(578)	(1,946)
Deferred revenue	682	1,189
Net cash used in operating activities	(40,048)	(29,476)
Cash flows from investing activities:
Purchases of property and equipment	(5,369)	(771)
Net cash used in investing activities	(5,369)	(771)
Cash flows from financing activities:
Proceeds from issuance of short-term bridge loan	2,000
Proceeds from exercise of stock options	481	140
Proceeds from issuance of common stock pursuant to employee stock purchase plan	418	482
Proceeds from issuance of common stock upon public offering, net of issuance costs	8,824
Repayment of short-term bridge loan	(2,000)
Net cash provided by financing activities	9,723	622
Net decrease in cash, cash equivalents and restricted cash	(35,694)	(29,625)
Cash, cash equivalents and restricted cash at beginning of period	104,064	165,928
Cash, cash equivalents and restricted cash at end of period	68,370	136,303
Supplemental disclosure of cash flow information:
Cash paid for interest	1,521	990
Supplemental disclosure of non-cash investing and financing activities:
Additions to property and equipment included in accounts payable and accrued expenses	$ 116	$ 245

Cash Equivalents and Restricted Cash (Tables)

6 Months Ended

Jun. 30, 2023

Cash Equivalents and Restricted Cash

Reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheet to the total amounts shown in the statement of cash flows


	June 30,		June 30,
	2023		2022
Cash and cash equivalents	$	66,606	$	134,539
Restricted cash		1,764		1,764
Total cash, cash equivalents and restricted cash	$	68,370	$	136,303

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2023	Aug. 03, 2023
Document And Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Document Transition Report	false
Entity File Number	001-36554
Entity Registrant Name	Ocular Therapeutix, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	20-5560161
Entity Address, Address Line One	24 Crosby Drive
Entity Address, City or Town	Bedford
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	01730
City Area Code	781
Local Phone Number	357-4000
Title of 12(b) Security	Common Stock, $0.0001 par value per share
Trading Symbol	OCUL
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		79,384,994
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Entity Central Index Key	0001393434
Amendment Flag	false

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2023	Dec. 31, 2022
Condensed Consolidated Balance Sheets
Preferred stock, par value	$ 0.0001	$ 0.0001
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	$ 0.0001	$ 0.0001
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	79,233,804	77,201,819
Common stock, shares outstanding	79,233,804	77,201,819

Licensing Agreements and Deferred Revenue (Details) - USD ($) $ in Thousands	1 Months Ended		3 Months Ended		6 Months Ended
	Jun. 30, 2023	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Collaboration Agreement
Revenue recognized			$ 15,186	$ 12,266	$ 28,561	$ 25,453
Total deferred revenue:
Deferred revenue, beginning balance					13,963
Additions					1,000
Amounts recognized into revenue					(318)
Deferred revenue, ending balance	$ 14,645		14,645		14,645
License Agreement \| AffaMed
Collaboration Agreement
Milestone payment received	1,000
License Agreement \| AffaMed \| OTX-TIC Product
Collaboration Agreement
Revenue recognized			157	122	318	811
Amount invoiced for initiation of OTX-TIC program		$ 2,000
Transaction price allocated to performance obligations partially unsatisfied	$ 645		645		645
License Agreement \| Incept
Collaboration Agreement
Royalties paid			$ 396	$ 375	$ 813	$ 744

Stock-Based Awards - Stock-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Stock-based Compensation
Stock-based compensation expense	$ 4,413	$ 4,281	$ 8,985	$ 8,490
Unrecognized stock-based compensation cost	23,528		$ 23,528
Weighted average period of unrecognized stock-based compensation cost expected to be recognized			2 years 3 months 25 days
Research and Development Expense
Stock-based Compensation
Stock-based compensation expense	1,133	1,036	$ 2,274	2,098
Selling and Marketing Expense
Stock-based Compensation
Stock-based compensation expense	970	1,191	2,014	2,329
General and Administrative Expense
Stock-based Compensation
Stock-based compensation expense	$ 2,310	$ 2,054	$ 4,697	$ 4,063

Subsequent Events (Details) - USD ($) $ in Thousands			1 Months Ended	6 Months Ended
Subsequent Events (Details) - USD ($) $ in Thousands	Aug. 07, 2023	Aug. 02, 2023	Aug. 04, 2023	Jun. 30, 2023	Dec. 31, 2022
Subsequent Events
Net proceeds from issuance of common stock				$ 8,824
MidCap Credit Facility
Subsequent Events
Borrowing capacity under the agreement				25,000
Long-term Debt, Gross				25,000	$ 25,000
Accrued exit fee				$ 448	$ 335
Subsequent Event \| 2021 Sales Agreement
Subsequent Events
Number of shares issued			144,718
Gross proceeds from issuance of common stock			$ 734
Net proceeds from issuance of common stock			$ 712
Subsequent Event \| Barings Credit Facility
Subsequent Events
Borrowing capacity under the agreement		$ 82,474
Principal amount of debt issued		82,474
Proceeds from issuance of debt, net		$ 77,790
Royalty fees payable as percentage of net sales.		3.50%
Minimum liquidity amount		$ 20,000
Subsequent Event \| Barings Credit Facility \| SOFR-based rate
Subsequent Events
Interest rate floor (as a percent)		1.50%
Basis spread (as a percent)		6.75%
Subsequent Event \| MidCap Credit Facility
Subsequent Events
Repayment of debt including principal, interest, exit and prepayment fees	$ 26,157
Repayment of debt	25,017
Payment of exit and prepayment fees in satisfaction of debt obligation	1,140
Incremental cost	$ 771
Change of control, Entered on or Prior to Six Months After the Closing Date \| Subsequent Event \| Barings Credit Facility
Subsequent Events
Royalty fees payable reduction , percentage of total credit facility amount.		20.00%
Change of control, Entered After Six Months, but Before Twelve Months, After Closing Date. \| Subsequent Event \| Barings Credit Facility
Subsequent Events
Royalty fees payable reduction , percentage of total credit facility amount.		30.00%

Stock-Based Awards

6 Months Ended

Jun. 30, 2023

Stock-Based Awards

Stock-Based Awards

11. Stock-Based Awards

For the three and six months ended June 30, 2023, the Company had three stock-based compensation plans under which it was able to grant stock-based awards, the 2021 Stock Incentive Plan, as amended (the “2021 Plan”), the 2019 Inducement Stock Incentive Plan, as amended (the “2019 Inducement Plan”), and the 2014 Employee Stock Purchase Plan (the “ESPP”), collectively the “Stock Plans”. The terms and conditions of the Stock Plans are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 6, 2023.

During the three and six months ended June 30, 2023, the Company granted options to purchase 249,600 and 3,240,741 shares of common stock, respectively at a weighted exercise price of $5.46 and $4.01 per share, respectively, all under the 2021 Plan.

During the three and six months ended June 30, 2023, the Company granted 83,198 and 1,030,831 restricted stock units, or RSUs, respectively, all under the 2021 Plan. Each RSU is equivalent to one share of common stock upon vesting.

During the three and six months ended June 30, 2023, a total of 428,860 and 560,207, respectively, stock options and RSUs expired or were forfeited.

At the Company’s Annual Meeting of Stockholders held on June 14, 2023, the Company’s stockholders approved an amendment of the Company’s 2021 Plan which increased the number of shares of common stock of the Company issuable under the 2021 Plan by 3,900,000 shares. As of June 30, 2023, 6,051,809, 545,375, and 513,069 shares of common stock remained available for issuance under the 2021 Plan, the 2019 Inducement Plan, and the ESPP, respectively.

The Company recorded stock-based compensation expense related to stock options and RSUs in the following expense categories of its unaudited condensed consolidated statements of operations and comprehensive loss:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Research and development	$	1,133	$	1,036	$	2,274	$	2,098
Selling and marketing		970		1,191		2,014		2,329
General and administrative		2,310		2,054		4,697		4,063
	$	4,413	$	4,281	$	8,985	$	8,490

As of June 30, 2023, the Company had an aggregate of $23,528 of unrecognized stock-based compensation cost, which is expected to be recognized over a weighted average period of 2.32 years.