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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2018	Nov. 01, 2018
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q3
Trading Symbol	OCUL
Entity Registrant Name	Ocular Therapeutix, Inc.
Entity Central Index Key	0001393434
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		41,095,372

Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 56,861	$ 41,538
Accounts receivable	240	226
Inventory	102	122
Prepaid expenses and other current assets	1,071	1,453
Total current assets	58,274	43,339
Property and equipment, net	10,382	10,478
Restricted cash	1,614	1,614
Total assets	70,270	55,431
Current liabilities:
Accounts payable	2,777	3,571
Accrued expenses and deferred rent	4,535	4,310
Notes payable, net of discount, current	6,094	5,545
Total current liabilities	13,406	13,426
Deferred rent, long-term	3,274	3,387
Notes payable, net of discount, long-term	8,073	12,471
Total liabilities	24,753	29,284
Commitments and contingencies (Note 10)
Stockholders' equity:
Preferred stock, $0.0001 par value; 5,000,000 shares authorized and no shares issued or outstanding at September 30, 2018 and December 31, 2017, respectively
Common stock, $0.0001 par value; 100,000,000 shares authorized and 40,524,335 and 29,658,202 shares issued and outstanding at September 30, 2018 and December 31, 2017	4	3
Additional paid-in capital	325,357	263,409
Accumulated deficit	(279,844)	(237,265)
Total stockholders' equity	45,517	26,147
Total liabilities and stockholders' equity	$ 70,270	$ 55,431

Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
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	100,000,000	100,000,000
Common stock, shares issued	40,524,335	29,658,202
Common stock, shares outstanding	40,524,335	29,658,202

Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Revenue:
Total revenue	$ 498	$ 523	$ 1,486	$ 1,436
Costs and operating expenses:
Research and development	9,685	8,126	26,657	22,972
Selling and marketing	1,067	3,238	2,651	16,097
General and administrative	4,447	4,230	13,665	11,230
Total costs and operating expenses	15,314	15,719	43,321	50,643
Loss from operations	(14,816)	(15,196)	(41,835)	(49,207)
Other income (expense):
Interest income	230	115	621	320
Interest expense	(424)	(491)	(1,365)	(1,402)
Other income (expense), net		5		5
Total other expense, net	(194)	(371)	(744)	(1,077)
Net loss	$ (15,010)	$ (15,567)	$ (42,579)	$ (50,284)
Net loss per share, basic and diluted	$ (0.38)	$ (0.54)	$ (1.15)	$ (1.76)
Weighted average common shares outstanding, basic and diluted	39,017,922	29,087,654	37,111,200	28,601,179
Comprehensive loss:
Net loss	$ (15,010)	$ (15,567)	$ (42,579)	$ (50,284)
Other comprehensive loss:
Unrealized gain on marketable securities				5
Total other comprehensive income				5
Total comprehensive loss	(15,010)	(15,567)	(42,579)	(50,279)
Product
Revenue:
Total revenue	498	523	1,486	1,436
Costs and operating expenses:
Cost of revenue	$ 115	$ 125	$ 348	$ 344

Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
Statements of Cash Flows - USD ($) $ in Thousands	Sep. 30, 2018	Sep. 30, 2017
Cash flows from operating activities:
Net loss	$ (42,579)	$ (50,284)
Adjustments to reconcile net loss to net cash used in operating activities
Stock-based compensation expense	5,534	5,212
Non-cash interest expense	265	309
Depreciation and amortization expense	1,704	1,097
(Gain)/loss on disposal of property and equipment		(5)
Purchase of premium on marketable securities		(3)
Amortization of premium on marketable securities		17
Changes in operating assets and liabilities:
Accounts receivable	(14)	(28)
Prepaid expenses and other current assets	382	507
Inventory	20	(14)
Accounts payable	(1,003)	163
Accrued expenses and deferred rent	112	2,939
Net cash used in operating activities	(35,579)	(40,090)
Cash flows from investing activities:
Purchases of property and equipment	(1,410)	(7,688)
Proceeds from sale of property and equipment		5
Purchases of marketable securities		(3,000)
Proceeds from maturities of marketable securities		38,200
Net cash (used in) provided by investing activities	(1,410)	27,517
Cash flows from financing activities:
Proceeds from issuance of notes payable		3,700
Proceeds from exercise of stock options	346	179
Proceeds from issuance of common stock pursuant to employee stock purchase plan	119	157
Proceeds from issuance of common stock offering, net	55,961	28,657
Payments of insurance costs financed by a third-party		(591)
Repayment of notes payable	(4,114)	(1,300)
Net cash provided by financing activities	52,312	30,802
Net increase in cash, cash equivalents and restricted cash	15,323	18,229
Cash, cash equivalents and restricted cash at beginning of period	43,152	34,664
Cash, cash equivalents and restricted cash at end of period	58,475	52,893
Supplemental disclosure of non-cash investing and financing activities:
Additions to property and equipment included in accounts payable and accrued expenses at balance sheet dates	198	314
Public offering costs included in accounts payable and accrued expenses at balance sheet dates	$ 11	$ 12

Nature of the Business and Basis of Presentation	9 Months Ended
Nature of the Business and Basis of Presentation	Sep. 30, 2018
Nature of the Business and Basis of Presentation
Nature of the Business and Basis of Presentation	Ocular Therapeutix, Inc. Notes to the Financial Statements (Amounts in thousands, except share and per share data) (Unaudited) 1. Nature of the Business and Basis of Presentation 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 platform technology. The Company uses this technology to tailor duration and amount of delivery of a range of therapeutic agents of varying duration in its product candidates. Since inception, the Company’s operations have been primarily focused on organizing and staffing the Company, acquiring rights to intellectual property, business planning, raising capital, developing its technology, identifying potential product candidates, undertaking preclinical studies and clinical trials, manufacturing initial quantities of its products and product candidates and building the initial sales and marketing infrastructure for the commercialization of the Company’s approved product and product candidates. 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, uncertainty of market acceptance of products, securing reimbursement and the need to obtain additional financing. 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. As of September 30, 2018, the Company’s lead product candidates were in 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 rapid change in technology and substantial competition from pharmaceutical and biotechnology companies. In addition, the Company is dependent upon the services of its employees and consultants. The Company 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, including to support the planned commercial launch of DEXTENZA®, subject to receiving FDA approval for its new drug application, or NDA, for post-surgical ocular pain filed on June 28, 2018 with a target action date under the Prescription Drug User Fee Act (commonly known as “PDUFA”) of December 28, 2018. The Company believes that its existing cash and cash equivalents as of September 30, 2018, will enable it to fund its operating expenses, debt service obligations and capital expenditure requirements into the second quarter of calendar year 2019. Management has determined that the Company’s accumulated deficit, history of losses, negative cash flows from operations and future expected losses raise substantial doubt about the Company’s ability to continue as a going concern within one year of the issuance date of these financial statements. 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 September 30, 2018, the Company had an accumulated deficit of $279,844. If the Company is unable to obtain other financing, the Company would be forced to delay, reduce or eliminate its research and development programs or any future commercialization efforts or to relinquish valuable rights to its technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to the Company. The actions necessary to reduce spending to a level that mitigates the factors described above are not considered probable, as defined in the accounting standards. The accompanying unaudited interim financial statements of the Company have been prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The accompanying unaudited interim financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from uncertainty related to the ability to continue as a going concern. The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Unaudited Interim Financial Information The balance sheet at December 31, 2017 was derived from audited financial statements, but does not include all disclosures required by GAAP. The accompanying unaudited financial statements as of September 30, 2018 and for the three and nine months ended September 30, 2018 and 2017 have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, the Company believes that the disclosures are adequate to make the information presented not misleading. These financial statements should be read in conjunction with the Company’s audited financial statements and the notes thereto for the year ended December 31, 2017 included in the Company’s Annual Report on Form 10-K on file with the SEC. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s financial position as of September 30, 2018 and results of operations and cash flows for the nine months ended September 30, 2018 and 2017 have been made. The results of operations for the three and nine months ended September 30, 2018 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2018.

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2018

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Use of Estimates

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

Fair Value Measurements

Certain assets and liabilities are carried at fair value under GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:

Level 1—Quoted prices in active markets for identical assets or liabilities.

Level 2—Observable inputs (other than Level 1 quoted prices) such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.

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

The Company’s cash equivalents at September 30, 2018 and December 31, 2017, were carried at fair value determined according to the fair value hierarchy described above (see Note 3). The carrying value of accounts receivable, accounts payable and accrued expenses approximate their fair value due to the short-term nature of these assets and liabilities. The carrying value of the Company’s outstanding notes payable (see Note 6) approximates fair value reflecting interest rates currently available to the Company.

Restricted Cash

The Company held certificates of deposit totaling $1,614 at September 30, 2018 and December 31, 2017, as security deposits for the lease of the Company’s manufacturing space and current corporate headquarters. The Company has classified these certificates of deposit as long-term restricted cash on its balance sheet.

Comprehensive Loss

Comprehensive loss includes net loss as well as other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders.

Net Loss Per Share

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

Recently Issued and Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 outlines a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. This new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized. The new model requires revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of Effective Date which delays the effective date of ASU 2014-09 such that the standard is effective for public entities for annual periods beginning after December 15, 2017 and for interim periods within those fiscal years. The FASB subsequently issued amendments to ASU No. 2014-09 that have the same effective date and transition date, all of which collectively are herein referred to as “the New Revenue Standard.”

The Company adopted the New Revenue Standard on January 1, 2018 using the modified retrospective method. The adoption of the New Revenue Standard did not have a material impact on its financial statements and footnote disclosures. Under the New Revenue Standard, the Company recognizes revenue when the customer obtains control of the good in an amount that reflects the consideration which the Company expects to receive in exchange for those goods. The Company only applies the New Revenue Standard to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods transferred to the customer.

In August 2016, the FASB issued Accounting Standards Update No. 2016-15, Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”). ASU 2016-15 is intended to clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows and to eliminate the diversity in practice related to such classifications. The Company adopted ASU 2016-15 effective January 1, 2018 and its adoption did not have a material impact on its financial statements.

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230) - Restricted Cash (“ASU 2016-18”). ASU 2016-18 requires a statement of cash flows to explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of- period total amounts shown on the statement of cash flows. The Company adopted ASU 2016-18 effective January 1, 2018 and has reflected the adoption retrospectively to all periods presented. The Company’s statements of cash flows include restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on such statements. A reconciliation of the cash, cash equivalents, and restricted cash reported within the balance sheet that sum to the total of the same amounts shown in the statement of cash flows is as follows:


	September 30,		September 30,		December 31,		December 31,
	2018		2017		2017		2016
Cash and cash equivalents	$	56,861	$	51,165	$	41,538	$	32,936
Restricted cash		1,614		1,728		1,614		1,728
Total cash, cash equivalents and restricted cash as shown on the statements of cash flows	$	58,475	$	52,893	$	43,152	$	34,664

In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting (“ASU 2017-09”), which clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. The new standard does not change the accounting for modifications but clarifies that modification accounting guidance should only be applied if the fair value, vesting conditions, or classification of the award changes as a result of the change in terms or conditions. A reporting entity must apply the amendments in the ASU prospectively to an award modified on or after the adoption date. The Company adopted ASU 2017-09 effective January 1, 2018, as required, and its adoption did not have a material impact on the Company’s financial statements. The adoption of ASU 2017-09, however, will have an impact on the accounting for the modification of stock-based awards, if any, to the extent stock-based awards are modified.

Recently Issued Accounting Pronouncements

In February 2016 and July 2018, the FASB issued ASU No. 2016-02, Leases (ASC 842) (“ASU 2016-02”) and ASU No. 2018-11, Targeted Improvements to ASC 842, Leases. These standards require lessees to recognize most leases on the balance sheet. This is expected to increase both reported assets and liabilities. The new lease standards do not substantially change lessor accounting. For public companies, the standards will be effective for the first interim reporting period within annual periods beginning after December 15, 2018. Lessees and lessors will be required to apply the new standards at the beginning of the earliest period presented in the financial statements in which they first apply the new guidance, using a modified retrospective transition method. The requirements of these standards include the presentation of right to use assets and the relative liability on the Company’s balance sheet for certain leasing arrangements, which previously have not been recorded on the balance sheet as well as a significant increase in required disclosures. The Company expects that adopting this new accounting guidance will have a material impact on the financial statements and footnote disclosures.

In September 30, 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”). The new standard simplifies the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees, with certain exceptions. The new standard will be effective beginning January 1, 2019 and early adoption is permitted. The Company does not expect that the adoption of ASU 2018-07 will have a material impact on its results of operations.

Fair Value of Financial Assets and Liabilities

9 Months Ended

Sep. 30, 2018

Fair Value of Financial Assets and Liabilities

Fair Value of Financial Assets and Liabilities

3. Fair Value of Financial Assets and Liabilities

The following tables present information about the Company’s assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2018 and December 31, 2017 and indicate the level of the fair value hierarchy utilized to determine such fair value:


	Fair Value Measurements as of
	September 30, 2018 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	—	$	50,163	$	—	$	50,163
Total	$	—	$	50,163	$	—	$	50,163


	Fair Value Measurements as of
	December 31, 2017 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	—	$	40,386	$	—	$	40,386
Total	$	—	$	40,386	$	—	$	40,386

During the nine months ended September 30, 2018 there were no transfers between Level 1, Level 2 and Level 3.

- Definition

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

+ References + Details

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2018
Income Taxes
Income Taxes	4. Income Taxes The Company did not provide for any income taxes in its statement of operations for the nine-month periods ended September 30, 2018 or 2017. The Company has provided a valuation allowance for the full amount of its net deferred tax assets because, at September 30, 2018 and December 31, 2017, 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. In accordance with SEC Staff Accounting Bulletin No. 118, which addresses the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the legislation commonly referred to as the Tax Cuts and Jobs Act, the Company has recorded provisional amounts during the year ended December 31, 2017. The Company filed its 2017 U.S. corporate income tax return in October 2018 and there was no resulting impact on any provisional amounts recorded in the Company’s income tax provision for the year ended December 31, 2017. The Company has not recorded any amounts for unrecognized tax benefits as of September 30, 2018 or December 31, 2017. As of September 30, 2018 and December 31, 2017, the Company had no accrued interest or tax penalties recorded related to income taxes. The Company’s income tax return reporting periods since December 31, 2014 are open to income tax audit examination by the federal and state tax authorities. In addition, because the Company has net operating loss carryforwards, the Internal Revenue Service is permitted to audit earlier years and propose adjustments up to the amount of net operating losses generated in those years.

Collaboration and Feasibility Agreements	9 Months Ended
Collaboration and Feasibility Agreements	Sep. 30, 2018
Collaboration and Feasibility Agreements
Collaboration and Feasibility Agreements	5. Collaboration and Feasibility Agreements In October 2016, the Company entered into a Collaboration, Option and License Agreement (the “Collaboration Agreement”) with Regeneron Pharmaceuticals, Inc. (“Regeneron”) for the development and potential commercialization of products containing the Company’s extended-delivery hydrogel formulation in combination with Regeneron’s large molecule VEGF-targeting compounds for the treatment of retinal diseases. The Collaboration Agreement does not cover the development of any products that deliver small molecule drugs, including tyrosine kinase inhibitors, or TKIs, or deliver large molecule drugs other than those that target VEGF proteins. Under the terms of the Collaboration Agreement, the Company and Regeneron have agreed to conduct a joint research program with the aim of developing an extended-delivery formulation of aflibercept, currently marketed under the tradename Eylea, that is suitable for advancement into clinical development. The Company has granted Regeneron an option (the “Option”) to enter into an exclusive, worldwide license to develop and commercialize products containing the Company’s hydrogel in combination with Regeneron’s large molecule VEGF-targeting compounds (“Licensed Products”). Under the term of the Collaboration Agreement, Regeneron is responsible for funding an initial preclinical tolerability study, which it initiated in early 2018. If the Option is exercised, Regeneron will conduct further preclinical development and an initial clinical trial under a collaboration plan. The Company is obligated to reimburse Regeneron for certain development costs incurred by Regeneron under the collaboration plan during the period through the completion of the initial clinical trial, subject to a cap of $25,000, which cap may be increased by up to $5,000 under certain circumstances. If Regeneron elects to proceed with further development following the completion of the collaboration plan, it will be solely responsible for conducting and funding further development and commercialization of product candidates. If the Option is exercised, Regeneron is required to use commercially reasonable efforts to research, develop and commercialize at least one Licensed Product. Such efforts shall include initiating the dosing phase of a subsequent clinical trial within specified time periods following the completion of the first-in-human clinical trial or the initiation of preclinical toxicology studies, subject to certain extensions. Through September 30, 2018, the Option has not been exercised, and no payments have been made to Regeneron. Under the terms of the Collaboration Agreement, Regeneron has agreed to pay the Company $10,000 upon the exercise of the Option. The Company is also eligible to receive up to $145,000 per Licensed Product upon the achievement of specified development and regulatory milestones, $100,000 per Licensed Product upon first commercial sale of such Licensed Product and up to $50,000 based on the achievement of specified sales milestones for all Licensed Products. In addition, the Company is entitled to tiered, escalating royalties, in a range from a high-single digit to a low-to-mid teen percentage of net sales of Licensed Products.

Notes Payable

9 Months Ended

Sep. 30, 2018

Notes Payable

Notes Payable

6. Notes Payable

The Company has outstanding borrowings under a credit and security agreement entered into in 2014 and as most recently amended in March 2017 (the “Amended Credit Facility”) totaling $18,000, which is collateralized by substantially all of the Company’s personal property, other than its intellectual property. The $18,000 of borrowings were drawn at the closing of the March 2017 amendment, which was used primarily to pay-off outstanding balances on the facility as of the amendment date of $14,300, resulting in net proceeds to the Company of $3,700.

The Company was obligated to make interest-only payments under the Amended Credit Facility until February 1, 2018, at which time the Company became obligated to make monthly principal and interest payments through December 1, 2020. Amounts borrowed under the Amended Credit Facility are at LIBOR base rate, subject to 1.00% floor, plus 7.25% with an indicative interest rate of 8.25% as of the amendment date. In addition, a final payment equal to 3.5% of amounts drawn under the Amended Credit Facility is due upon the maturity date of December 1, 2020, which the Company has accrued for using the effective interest rate method. At September 30, 2018 and December 31, 2017, the outstanding balance amounted to $14,167 and $18,016, including the amount accrued for the 3.5% final payment respectively, net of unamortized discount.

There are no financial covenants associated with the Amended Credit Facility; however, there are certain negative covenants restricting the Company’s activities, including limitations on dispositions, mergers or acquisitions; encumbering its intellectual property; incurring indebtedness or liens; paying dividends; making certain investments; and engaging in certain other business transactions. The obligations under the Amended Credit Facility are subject to acceleration upon the occurrence of specified events of default, including a material adverse change in the Company’s business, operations or financial or other condition.

The Company accounted for the amendment of the Amended Credit Facility in March 2017 as a modification in accordance with the guidance in ASC 470-50, Debt. Amounts paid to the lenders were recorded as debt discount and a new effective interest rate was established. The effective annual interest rate of the outstanding debt under the Amended Credit Facility is 10.5%.

As of September 30, 2018, the annual repayment requirements for the Amended Credit Facility, inclusive of the final payment of $630 due at expiration, were as follows:



			Final
Year Ending December 31,	Principal		Payment		Total
Remainder of 2018	$	1,544	$	—	$	1,544
2019		6,171		—		6,171
2020		6,171		630		6,801
	$	13,886	$	630	$	14,516

Interest paid amounted to $1,131 and $1,075 for the nine months ended September 30, 2018 and 2017, respectively.

Common Stock	9 Months Ended
Common Stock	Sep. 30, 2018
Common Stock
Common Stock	7. Common Stock In January 2018, the Company completed a follow-on offering of its common stock at a public offering price of $5.00 per share. The offering consisted of 7,475,000 shares of common stock sold by the Company, including those shares sold in connection with the exercise by the underwriter of its option to purchase additional shares. The Company received net proceeds from the follow-on offering of $34,704 after deducting underwriting discounts, commissions and expenses. In January 2017, the Company completed a follow-on offering of its common stock at a public offering price of $7.00 per share. The offering consisted of 3,571,429 shares of common stock sold by the Company. The Company received net proceeds from the follow-on offering of $23,261 after deducting underwriting discounts, commissions and expenses. In November 2016, the Company entered into a controlled equity offering sales agreement (the “2016 Sales Agreement”) with Cantor Fitzgerald & Co., under which the Company may offer and sell its common stock having aggregate proceeds of up to $40,000 from time to time. In the three and nine months ended September 30, 2017, the Company sold 258,860 and 690,999 shares of common stock at-the-market under the 2016 Sales Agreement, resulting in net proceeds of approximately $1,573 and $5,384 after underwriting discounts, commission and expenses, respectively. In the three and nine months ended September 30, 2018, the Company sold 2,026,031 and 3,192,566 shares of common stock at-the-market under the 2016 Sales Agreement, resulting in net proceeds of approximately $12,852 and $21,241, respectively, after underwriting discounts, commissions and expenses. Through September 30, 2018, the Company has sold 4,083,134 shares of common stock at-the-market under the 2016 Sales Agreement, resulting in net proceeds of approximately $27,844 after underwriting discounts, commissions and expenses. As of September 30, 2018, the Company had approximately $10,864 available for future sale under the 2016 Sales Agreement.

Net Loss Per Share

9 Months Ended

Sep. 30, 2018

Net Loss Per Share

Net Loss Per Share

8. Net Loss Per Share

Basic and diluted net loss per share was calculated as follows for the three and nine months ended September 30, 2018 and 2017:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2018			2017	2018		2017
Numerator:
Net loss attributable to common stockholders	$	(15,010)	$	(15,567)	$	(42,579)	$	(50,284)
Denominator:
Weighted average common shares outstanding, basic and diluted		39,017,922		29,087,654		37,111,200		28,601,179
Net loss per share attributable to common stockholders, basic and diluted	$	(0.38)	$	(0.54)	$	(1.15)	$	(1.76)

The Company excluded the following common stock equivalents, outstanding as of September 30, 2018 and 2017, from the computation of diluted net loss per share for the three and nine months ended September 30, 2018 and 2017 because they had an anti-dilutive impact due to the net loss incurred for the periods.


	As of September 30,
	2018	2017
Options to purchase common stock	5,175,803	4,106,763
Warrants for the purchase of common stock	18,939	18,939
	5,194,742	4,125,702

Stock-Based Awards

9 Months Ended

Sep. 30, 2018

Stock-Based Awards

Stock-Based Awards

9. Stock-Based Awards

2014 Stock Incentive Plan

The 2014 Stock Incentive Plan (the “2014 Plan”) provides for the grant of incentive stock options, non-statutory stock options, restricted stock awards, restricted stock units, stock appreciation rights and other stock-based awards. The number of shares of common stock that may be issued under the 2014 Plan is subject to increase on the first day of each fiscal year, beginning on January 1, 2015 and ending on December 31, 2024 in an amount equal to the lesser of a pre-determined formula or as determined by the Company’s board of directors. On January 1, 2018, the number of shares available for issuance under the 2014 Plan was increased by 1,186,328. As of September 30, 2018, 1,649,106 shares remained available for issuance under the 2014 Plan.

2014 Employee Stock Purchase Plan

The Company has a 2014 Employee Stock Purchase Plan (the “ESPP”). The number of shares of common stock that may be issued under the ESPP will automatically increase on the first day of each fiscal year, commencing on January 1, 2015 and ending on December 31, 2024 in an amount equal to the lesser of a pre-determined formula or as determined by the Company’s board of directors. On January 1, 2018, the number of shares available for issuance under the 2014 Plan was increased by 148,291. During the nine months ended September 30, 2018, 29,141 shares of common stock were issued. As of September 30, 2018, 453,824 shares remained available for issuance under the ESPP.

Inducement Stock Option Awards

On June 20, 2017, the Company issued to Antony Mattessich, who became a director of the Company on June 20, 2017 and the Company’s President and Chief Executive Officer on July 26, 2017, a non-statutory stock option to purchase an aggregate of 590,000 shares of the Company’s common stock at an exercise price of $10.94 per share. Subject to Mr. Mattessich’s continued service to the Company, the stock option will vest over a four-year period, with 25% of the shares underlying the option award vesting on the one-year anniversary of the grant date and the remaining 75% of the shares underlying the award vesting monthly thereafter. The stock option was issued outside of the Company’s 2014 Plan as an inducement material to Mr. Mattessich’s acceptance of entering into employment with the Company in accordance with Nasdaq Listing Rule 5635(c)(4).

Stock-based Compensation

The Company recorded stock-based compensation expense related to stock options and restricted common stock in the following expense categories of its statements of operations:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2018		2017		2018		2017
Research and development	$	627	$	563	$	1,853	$	1,674
Selling and marketing		116		59		343		527
General and administrative		1,130		1,129		3,338		3,011
	$	1,873	$	1,751	$	5,534	$	5,212

As of September 30, 2018, the Company had an aggregate of $12,789 of unrecognized stock-based compensation cost, which is expected to be recognized over a weighted average period of 2.6 years.

As of September 30, 2018, there were outstanding unvested service-based stock options held by nonemployees for the purchase of 17,084 shares of common stock.

Commitments and Contingencies	9 Months Ended
Commitments and Contingencies	Sep. 30, 2018
Commitments and Contingencies.
Commitments and Contingencies	10. Commitments and Contingencies Intellectual Property Licenses The Company has a license agreement with Incept LLC (“Incept”) to use and develop certain patent rights (the “Incept License”). Under the Incept License, as amended and restated, the Company was granted a worldwide, perpetual, exclusive license 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. Any of the Company’s sublicensees also will be obligated to pay Incept a royalty equal to a low single-digit percentage of net sales made by it and will be bound by the terms of the agreement to the same extent as the Company. The Company is obligated to reimburse Incept for its share of the reasonable fees and costs incurred by Incept in connection with the prosecution of the patent applications licensed to the Company under the Incept License. Through September 30, 2018, royalties paid under this agreement related to product sales were $199 and have been charged to cost of product revenue. On September 13, 2018, (the “Effective Date) the Company entered into a second amended and restated license agreement (the “Second Amended Agreement”) with Incept. The Second Amended Agreement amends and restates in full the Company’s prior amended and restated Incept License (the “Prior Agreement” or “Original License”) to expand the scope of the Company’s intellectual property license and modify future intellectual property ownership and other rights thereunder. License Rights; Ownership of Intellectual Property The parties have agreed to expand the field of use of the exclusive, worldwide, perpetual, irrevocable license held by the Company under the Prior Agreement to include specified intellectual property rights and technology owned or controlled by Incept to make, have made, use, offer for sale, sell, sublicense, have sublicensed, offer for sublicense and import, (i) consistent with the Prior Agreement, products delivered to or around the human eye for diagnostic, therapeutic or prophylactic purposes relating to all human ophthalmic diseases or conditions (the “Ophthalmic Field of Use”) and (ii) as a result of the expansion of the scope of the Original License, products delivered for the treatment of acute post-surgical pain or for the treatment of ear, nose and/or throat diseases or conditions, subject to specified exceptions (the “Additional Field of Use”). The parties have further agreed to expand the field of use of the Original License for certain patents, patent applications and other rights pertaining to shape-changing hydrogel formulations thereunder (the “Shape-Changing IP”) to include all fields except those involving the nerves and associated tissues specified in the Second Amended Agreement. The Company will solely own, without a license to Incept, all intellectual property rights conceived solely by one or more individuals from the Company (“Company Individuals”) after the Effective Date, subject to exceptions specified therein. Subject to certain exceptions specified in the Second Amended Agreement, Incept will own and license to the Company (i) all intellectual property rights included in the Original License (“Original IP”) in the Ophthalmic Field of Use and the Additional Field of Use, (ii) intellectual property rights in the field of drug delivery conceived by one or more Company Individuals on or before the Effective Date (“Incept IP”), and (iii) intellectual property rights in the field of drug delivery conceived by one or more Company Individuals jointly with one or more individuals from Incept, including Dr. Sawhney (“Incept Individuals”), after the Effective Date (“Joint IP” and, collectively with the Original IP and the Incept IP, the “Licensed IP”). Financial Terms The Company and any of its sublicensees are obligated to pay Incept royalties as follows under the Agreement: (i) consistent with the Prior Agreement, a royalty equal to a low single-digit percentage of net sales by the Company or its affiliates of products, devices, materials, or components thereof (“Licensed Products”), including or covered by Original IP, excluding the Shape-Changing IP, in the Ophthalmic Field of Use; (ii) a royalty equal to a mid-single-digit percentage of net sales by the Company or its affiliates of Licensed Products including or covered by Original IP, excluding the Shape-Changing IP, in the Additional Field of Use; and (iii) a royalty equal to a low single-digit percentage of net sales by the Company or its affiliates of Licensed Products including or covered by Incept IP or Joint IP in the field of drug delivery. Royalty obligations under the Second Amended Agreement commence with the first commercial sale of a Licensed Product described above and terminate upon the expiration of the last-to-expire patents included in the Licensed IP, as applicable. Any sublicensee of the Company also will be obligated to pay Incept royalties on net sales of Licensed Products made by it and will be bound by the terms of the Second Amended Agreement to the same extent as the Company. Additionally, at its sole discretion, Incept may require, as a condition of any sublicense by the Company in the Additional Field of Use and in exchange for a reduction in the royalties owed on net sales of Licensed Products described above, payments equal to a mid-teen percentage of any upfront payment and, subject to certain conditions, other payments received by the Company from the sublicensee. Patent Prosecution and Litigation Incept will continue to have sole control and responsibility for ongoing prosecution of patents included in the Original IP, and the Company will have sole control and responsibility for ongoing prosecution of patents and patent applications included in or arising under the Incept IP or Joint IP. The parties have agreed to work together in good faith to enter into a separate agreement under which, subject to certain limitations, the Company would assume control of the prosecution of patents and patent applications included in or arising under the Shape-Changing IP. The Company has the right, subject to certain conditions, to bring suit against third parties who infringe the patents included in the Original IP in the Ophthalmic Field of Use or the Additional Field of Use, patents included in the Incept IP in the drug delivery filed, patents included in the Joint IP in the drug delivery field, and patents included in the Shape-Changing IP in all fields except as described above. The Company has also agreed, if requested by Incept, to enter into a joint defense and prosecution agreement for the purpose of allowing the parties to share confidential and attorney-client privileged information regarding the possible infringement of one or more patents covered by the Second Amended Agreement. The Company is responsible for all costs incurred in prosecuting any infringement action it brings. Term and Termination The Second Amended Agreement will expire on the later of (i) the expiration or disclaimer by the Company of the last valid claim of an issued and unexpired patent included in the Licensed IP or (ii) the final unappealable rejection or abandonment of the last pending patent application arising under the Licensed IP. Either party may terminate the Second Amended Agreement in the event of the other party’s insolvency, bankruptcy or comparable proceedings, or if the other party materially breaches the agreement and does not cure such breach during a specified cure period. Collaboration Agreement In October 2016, the Company entered into the Collaboration Agreement with Regeneron as described in Note 5. Under the terms of the Collaboration Agreement, the Company has granted Regeneron an Option to enter into an exclusive, worldwide license to develop and commercialize products containing the Company’s hydrogel in combination with Regeneron’s large molecule VEGF-targeting compounds. If the Option is exercised, the Company is obligated to reimburse Regeneron for certain development costs incurred under the collaboration plan during the period through the completion of the initial clinical trial, subject to a cap of $25,000, which cap may be increased by up to $5,000 under certain circumstances. Legal Proceedings Securities Class Actions On July 7, 2017, a putative class action lawsuit was filed against the Company and certain of the Company’s current and former executive officers in the United States District Court for the District of New Jersey, captioned Thomas Gallagher v. Ocular Therapeutix, Inc, et al., Case No. 2:17-cv-05011. The complaint purports to be brought on behalf of shareholders who purchased the Company’s common stock between May 5, 2017 and July 6, 2017. The complaint generally alleges that the Company and certain of the Company’s current and former officers violated Sections 10(b) and/or 20(a) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 promulgated thereunder by making allegedly false and/or misleading statements concerning the Form 483 issued by the FDA related to DEXTENZA and the Company’s manufacturing operations for DEXTENZA. The complaint seeks unspecified damages, attorneys’ fees, and other costs. On July 14, 2017, an amended complaint was filed; the amended complaint purports to be brought on behalf of shareholders who purchased the Company’s common stock between May 5, 2017 and July 11, 2017, and otherwise includes allegations similar to those made in the original complaint. On July 12, 2017, a second putative class action lawsuit was filed against the Company and certain of the Company’s current and former executive officers in the United States District Court for the District of New Jersey, captioned Dylan Caraker v. Ocular Therapeutix, Inc., et al., Case No. 2:17-cv-05095. The complaint purports to be brought on behalf of shareholders who purchased the Company’s common stock between May 5, 2017 and July 6, 2017. The complaint includes allegations similar to those made in the Gallagher complaint, and seeks similar relief. On August 3, 2017, a third putative class action lawsuit was filed against the Company and certain of the Company’s current and former executive officers in the United States District Court for the District of New Jersey, captioned Shawna Kim v. Ocular Therapeutix, Inc., et al., Case No. 2:17-cv-05704. The complaint purports to be brought on behalf of shareholders who purchased the Company’s common stock between March 10, 2016 and July 11, 2017. The complaint includes allegations similar to those made in the Gallagher complaint, and seeks similar relief. On October 27, 2017, a magistrate judge for the United States District Court for the District of New Jersey granted the defendants’ motion to transfer the above-referenced Gallagher, Caraker, and Kim litigations to the United States District Court for the District of Massachusetts. These matters were assigned the following docket numbers in the District of Massachusetts: 1:17-cv-12288 (Gallagher), 1:17-cv-12146 (Caraker), and 1:17-cv-12286 (Kim). On March 9, 2018, the court consolidated the three actions and appointed co-lead plaintiffs and co-lead counsel for the consolidated action. On May 7, 2018, co-lead plaintiffs filed a consolidated amended class action complaint. The amended complaint makes allegations similar to those in the original complaints, against the same defendants, and seeks similar relief on behalf of shareholders who purchased the Company’s common stock between March 10, 2016 and July 11, 2017. The amended complaint generally alleges that defendants violated Sections 10(b) and/or 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder. On July 6, 2018, defendants filed a motion to dismiss the consolidated amended complaint. Plaintiffs’ filed an opposition to the motion to dismiss on September 4, 2018, and defendants filed a reply on October 4, 2018. The Company denies any allegations of wrongdoing and intends to vigorously defend against these lawsuits. Shareholder Derivative Litigation On July 11, 2017, a purported shareholder derivative lawsuit was filed against certain of the Company’s current and former executive officers, certain current and former board members, and the Company as a nominal defendant, in the United States District Court for the District of Massachusetts, captioned Robert Corwin v. Sawhney et al., Case No. 1:17-cv-11270. The complaint generally alleged that the individual defendants breached fiduciary duties owed to the Company by making allegedly false and/or misleading statements concerning the Form 483 related to DEXTENZA and our manufacturing operations for DEXTENZA. The complaint purported to assert claims against the individual defendants for breach of fiduciary duty, and sought to recover on behalf of the Company for any liability the Company incurs as a result of the individual defendants’ alleged misconduct. The complaint also sought contribution on behalf of the Company from all individual defendants for their alleged violations of Sections 10(b) and/or 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder. The complaint sought declaratory, equitable, and monetary relief, an unspecified amount of damages, with interest, and attorneys’ fees and costs. On September 20, 2017, counsel for the plaintiff filed a notice of voluntary dismissal, stating that the plaintiff wished to coordinate his efforts and proceed in a consolidated fashion with the plaintiff in a similar derivative suit that was pending in the Superior Court of Suffolk County of the Commonwealth of Massachusetts captioned Angel Madera v. Sawhney et al., Case. No. 17-2273 (which is discussed in the paragraph immediately below) by filing an action in that court subsequent to the dismissal of this lawsuit. The Corwin lawsuit was dismissed without prejudice on September 21, 2017. On October 24, 2017, the plaintiff filed a new derivative complaint in Massachusetts Superior Court (Suffolk County), captioned Robert Corwin v. Sawhney et al., Case No. 17-3425 (BLS2). The new Corwin complaint includes allegations similar to those made in the federal court complaint and asserts a derivative claim for breach of fiduciary duty against certain of our current and former officers and directors. The complaint also asserts an unjust enrichment claim against two additional defendants, SV Life Sciences Fund IV, LP and SV Life Sciences Fund IV Strategic Partners, LP. The complaint also names the Company as a nominal defendant. On July 19, 2017, a second purported shareholder derivative lawsuit was filed against certain of the Company’s current and former executive officers, all current board members, one former board member, and the Company as a nominal defendant, in the Superior Court of Suffolk County of the Commonwealth of Massachusetts, captioned Angel Madera v. Sawhney et al., Case. No. 17-2273. The complaint included allegations similar to those made in the Corwin complaint. The complaint purported to assert derivative claims against the individual defendants for breach of fiduciary duty, unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets, and sought to recover on behalf of the Company for any liability the Company incurs as a result of the individual defendants’ alleged misconduct. The complaint sought declaratory, equitable, and monetary relief, an unspecified amount of damages, with interest, and attorneys’ fees and costs. On November 6, 2017, the court dismissed this action without prejudice due to plaintiff’s failure to complete service of process within the time permitted under applicable court rules. On December 21, 2017, the same plaintiff filed a new derivative complaint in the same court, captioned Angel Madera v. Sawhney et al., Case. No. 17-4126 (BLS2). The new Madera complaint is premised on substantially similar allegations as the previous complaint and purports to assert derivative claims against certain current and former executive officers and board members for breach of fiduciary duty, unjust enrichment, and waste of corporate assets, and names the Company as a nominal defendant. Like the new Corwin complaint, the new Madera complaint also asserts an unjust enrichment claim against two additional defendants, SV Life Sciences Fund IV, LP and SV Life Sciences Fund IV Strategic Partners, LP. By order dated January 29, 2018, the court consolidated the state court Corwin and Madera complaints under the Corwin docket and appointed lead counsel for plaintiffs. On February 28, 2018, plaintiffs filed a consolidated amended complaint. The consolidated complaint names substantially the same defendants and is premised on substantially similar allegations as the previous Corwin and Madera complaints, asserting claims for breach of fiduciary duty against the individual defendants and unjust enrichment against the two SV entity defendants. On April 17, 2018, all defendants served a motion to dismiss the consolidated amended complaint. On June 22, 2018, plaintiffs served their opposition to the motion to dismiss and a cross-motion to stay the proceedings pending a decision on the motion to dismiss in the above-referenced securities class action in the District of Massachusetts. On July 30, 2018, the parties filed a joint motion to stay the proceedings pending a decision on the motion to dismiss in the above-referenced securities class action in the District of Massachusetts. On August 3, 2018, the court granted the motion to stay. On January 31, 2018, a third purported shareholder derivative suit was filed against certain of the Company’s current and former executive officers, certain current and former board members, and the Company as a nominal defendant, in the United States District Court for the District of Massachusetts, captioned Brian Robinson v. Sawhney et al., Case. No. 1:18-cv-10199. The complaint includes allegations similar to those made in the Corwin and Madera complaints. The complaint does not name either SV Life Sciences Fund, IV, LP or SV Life Sciences Fund IV Strategic Partners, LP as defendants, and adds two former officers as defendants. The complaint purports to assert derivative claims against the individual defendants for breach of fiduciary duty, waste of corporate assets, and unjust enrichment, and seeks to recover on behalf of the Company for any liability the Company incurs as a result of the individual defendants’ alleged misconduct. The complaint seeks declaratory, equitable, and monetary relief, an unspecified amount of damages, with interest, and attorneys’ fees and costs. On April 30, 2018, all defendants filed a motion to dismiss or stay the complaint. Plaintiff filed his opposition on June 22, 2018. On July 26, 2018, the parties filed a joint motion to extend the deadline for defendants to file their reply brief pending the potential substitution of the named shareholder plaintiff. On August 20, 2018, the parties filed a joint stipulation and proposed order regarding plaintiff’s unopposed request to substitute a new shareholder plaintiff and the parties’ joint request that the court stay the proceedings pending a decision on the motion to dismiss in the above-referenced securities class action in the District of Massachusetts. On September 4, 2018, the court entered the requested order substituting the named plaintiff and staying the matter. On February 16, 2018, a fourth purported shareholder derivative suit was filed against certain of the Company’s current and former executive officers, certain current and former board members, and the Company as a nominal defendant, in the United States District Court for the District of Delaware, captioned Terry Kelly v. Sawhney et al., Case. No. 1:18-cv-00277. The complaint includes allegations similar to those made in the Corwin and Madera complaints. The complaint purports to assert derivative claims against the individual defendants for breach of fiduciary duty, unjust enrichment and waste of corporate assets, and seeks to recover on behalf of the Company for any liability the Company incurs as a result of the individual defendants’ alleged misconduct. The complaint also asserts an unjust enrichment claim against SV Life Sciences Fund IV, LP and SV Life Sciences Fund IV Strategic Partners, LP. The complaint seeks declaratory, equitable, and monetary relief, an unspecified amount of damages, with interest, and attorneys’ fees and costs. On June 11, 2018, the parties filed a stipulation staying the lawsuit pending final judgment in the consolidated derivative action pending in Massachusetts state court under the Corwin docket, described above. The court entered an order staying the case on June 12, 2018. The Company denies any allegations of wrongdoing and intend to vigorously defend against these lawsuits. In addition, the Company has received a subpoena from the SEC, dated December 15, 2017, requesting documents and information concerning DEXTENZA (dexamethasone insert) 0.4mg, including related communications with the FDA, investors and others. The Company received a second subpoena from the SEC on August 21, 2018, requesting documents and information concerning its participation in two investor conferences in June 2017. The Company intends to fully cooperate with the SEC regarding this non-public, fact-finding inquiry. The SEC has informed the Company that this inquiry should not be construed as an indication that any violations of law have occurred or that the SEC has any negative opinion of any person, entity or security. The Company is unable to predict the outcome of these lawsuits or proceedings at this time. Moreover, any conclusion of these matters in a manner adverse to the Company and for which it incurs substantial costs or damages not covered by our directors’ and officers’ liability insurance would have a material adverse effect on the Company’s financial condition and business. In addition, the proceedings could adversely impact the Company’s reputation and divert management’s attention and resources from other priorities, including the execution of business plans and strategies that are important to the Company’s ability to grow the Company’s business, any of which could have a material adverse effect on the Company’s business.

Related Party Transactions	9 Months Ended
Related Party Transactions	Sep. 30, 2018
Related Party Transactions
Related Party Transactions	11. Related Party Transactions The Company has a license agreement with Incept to use and develop certain patent rights that it entered into in 2007, amended and restated in January 2012 and further amended and restated in September 2018 (see Note 10). Incept and certain owners of Incept are shareholders of the Company. In addition, certain employees of the Company are shareholders of Incept. The Company’s Chairman of the Board of Directors and former President and Chief Executive Officer (“CEO”) is a general partner of Incept and has a 50% ownership stake in Incept. In July 2017, the Company terminated a service arrangement with Axtria, Inc. (“Axtria”), a company that provided data warehouse implementation, operations and maintenance support services to the Company. Jaswinder Chadha, co-founder and CEO of Axtria, is also a member of the Company’s Board of Directors and a cousin to the Company’s Chairman of the Board of Directors and former President and CEO. During the nine months ended September 30, 2017, the Company incurred expenses of $864. As of September 30, 2018 and December 31, 2017, there were no amounts due to Axtria. Since October 2017, the Company has engaged McCarter English LLP (“McCarter”) to provide legal services to the Company, including with respect to intellectual property matters. The Company’s Senior Vice President, Technical Operations, Kevin Hanley, who joined the Company in January 2018, is married to a partner at McCarter, who has not participated in providing legal services to the Company. The Company incurred fees for legal services rendered by McCarter of $155 and $376 for the three and nine months ended September 30, 2018, respectively. As of September 30, 2018, there was $65, recorded in accrued expenses for McCarter.

Restructuring and Other Costs

9 Months Ended

Sep. 30, 2018

Restructuring and Other Costs

Restructuring and Other Costs

12. Restructuring and Other Costs

On July 31, 2017, the Board of Directors approved a strategic restructuring to eliminate a portion of the Company’s workforce as part of an initiative to enhance operations and reduce expenses. As part of this strategic restructuring, the Company eliminated 30 positions across the organization. During the third quarter of 2017, the Company recorded $1,703 of restructuring-related costs in operating expenses in research and development and selling and marking, including employee severance, benefits and related costs.

On July 31, 2017, the Company entered into a transition, separation and release of claims agreement (the “Ankerud Transition Agreement”), pursuant to which Eric Ankerud resigned from his role as Executive Vice President, Regulatory, Quality and Compliance of the Company, effective immediately. Mr. Ankerud continued to serve as an at-will employee of the Company in the capacity of Senior Advisor until October 31, 2017. He currently serves as a consultant to the Company. Under the Ankerud Transition Agreement, Mr. Ankerud is entitled to separation benefits until October 31, 2018, in the form of continuation of his base salary in the same amount in effect as of October 31, 2017; the payment of monthly premiums for healthcare and/or dental coverage; and provided he continues to provide services to the Company as a consultant, the continued vesting of his outstanding stock options awards in accordance with the applicable equity plans and stock option agreements. During the third quarter of 2017, the Company recorded $386 of severance expense which are included in operating expenses in research and development.

On October 13, 2017, the Company entered into a transition, separation and release of claims agreement (the “Fortune Transition Agreement”) with James Fortune, pursuant to which Mr. Fortune resigned from his role as Chief Operating Officer and any and all other positions he holds as an officer or employee of the Company, effective December 31, 2017 (the “Separation Date”). Pursuant to the Fortune Transition Agreement, effective as of October 13, 2017, the Employment Agreement, by and between the Company and Mr. Fortune, dated June 19, 2014, was terminated. Under the Fortune Transition Agreement, Mr. Fortune will be entitled to separation benefits in the form of (i) the continuation of his base salary for twelve months after the Separation Date in the same amount in effect as of the October 13, 2017 and (ii) the payment of monthly premiums for healthcare and/or dental coverage at the same rate that is in effect on the Separation Date until the earlier of twelve months from the Separation Date or the date Mr. Fortune becomes eligible to receive such benefits under another employer’s benefit plan. For the calendar year 2017, Mr. Fortune was eligible to receive a bonus payment in such amount, if any, as he would have received had he remained employed with the Company through the date of such bonus payments. On January 31, 2018, the Company’s Compensation Committee determined to grant Mr. Fortune a bonus of $62 for his performance in 2017 and this amount was included in accrued expenses as of December 31, 2017. During the fourth quarter of 2017, the Company recorded $417 of severance expense which was included in operating expenses in general and administration.

The following table summarizes the restructuring and other costs reserve for the period indicated, which is included in accrued expenses in the accompany balance sheets for the period indicated:


	Nine Months Ended
	September 30, 2018
Restructuring and other costs at December 31, 2017	$	960
Amounts paid during the period		(822)
Restructuring and other costs at September 30, 2018	$	138

Subsequent Events	9 Months Ended
Subsequent Events	Sep. 30, 2018
Subsequent Events
Subsequent Events	13. Subsequent Event The Company sold an additional 562,309 shares of common stock between October 1, 2018 and October 31, 2018, at-the-market under the 2016 Sales Agreement discussed in Note 7, resulting in net proceeds of approximately $3,602 after underwriting discounts, commissions and expenses. As of November 2, 2018, the Company had approximately $7,170 available for future sale under the 2016 Sales Agreement.

Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2018

Summary of Significant Accounting Policies

Use of Estimates

Fair Value Measurements

Level 1—Quoted prices in active markets for identical assets or liabilities.

Restricted Cash

Comprehensive Loss

Comprehensive loss includes net loss as well as other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders.

Net Loss Per Share

Recently Issued and Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements


	September 30,		September 30,		December 31,		December 31,
	2018		2017		2017		2016
Cash and cash equivalents	$	56,861	$	51,165	$	41,538	$	32,936
Restricted cash		1,614		1,728		1,614		1,728
Total cash, cash equivalents and restricted cash as shown on the statements of cash flows	$	58,475	$	52,893	$	43,152	$	34,664

Recently Issued Accounting Pronouncements

Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2018

Summary of Significant Accounting Policies

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


	September 30,		September 30,		December 31,		December 31,
	2018		2017		2017		2016
Cash and cash equivalents	$	56,861	$	51,165	$	41,538	$	32,936
Restricted cash		1,614		1,728		1,614		1,728
Total cash, cash equivalents and restricted cash as shown on the statements of cash flows	$	58,475	$	52,893	$	43,152	$	34,664

Fair Value of Financial Assets and Liabilities (Tables)

9 Months Ended

Sep. 30, 2018

Fair Value of Financial Assets and Liabilities

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


	Fair Value Measurements as of
	September 30, 2018 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	—	$	50,163	$	—	$	50,163
Total	$	—	$	50,163	$	—	$	50,163


	Fair Value Measurements as of
	December 31, 2017 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	—	$	40,386	$	—	$	40,386
Total	$	—	$	40,386	$	—	$	40,386

Notes Payable (Tables)

9 Months Ended

Sep. 30, 2018

Notes Payable

Schedule of Annual Repayment Requirements for Credit Facility



			Final
Year Ending December 31,	Principal		Payment		Total
Remainder of 2018	$	1,544	$	—	$	1,544
2019		6,171		—		6,171
2020		6,171		630		6,801
	$	13,886	$	630	$	14,516

Net Loss Per Share (Tables)

9 Months Ended

Sep. 30, 2018

Net Loss Per Share

Schedule of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders


	Three Months Ended September 30,				Nine Months Ended September 30,
	2018			2017	2018		2017
Numerator:
Net loss attributable to common stockholders	$	(15,010)	$	(15,567)	$	(42,579)	$	(50,284)
Denominator:
Weighted average common shares outstanding, basic and diluted		39,017,922		29,087,654		37,111,200		28,601,179
Net loss per share attributable to common stockholders, basic and diluted	$	(0.38)	$	(0.54)	$	(1.15)	$	(1.76)

Schedule of Antidilutive Securities, Excluded from Computation of Diluted Net Loss per Share


	As of September 30,
	2018	2017
Options to purchase common stock	5,175,803	4,106,763
Warrants for the purchase of common stock	18,939	18,939
	5,194,742	4,125,702

Stock-Based Awards (Tables)

9 Months Ended

Sep. 30, 2018

Stock-Based Awards

Schedule of Stock-Based Compensation Expense Related to Stock Options and Restricted Common Stock


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2018		2017		2018		2017
Research and development	$	627	$	563	$	1,853	$	1,674
Selling and marketing		116		59		343		527
General and administrative		1,130		1,129		3,338		3,011
	$	1,873	$	1,751	$	5,534	$	5,212

Restructuring and Other Costs (Tables)

9 Months Ended

Sep. 30, 2018

Restructuring and Other Costs

Summary of restructuring and other costs reserve


	Nine Months Ended
	September 30, 2018
Restructuring and other costs at December 31, 2017	$	960
Amounts paid during the period		(822)
Restructuring and other costs at September 30, 2018	$	138

Nature of the Business and Basis of Presentation - Nature of Business (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Nature of the Business and Basis of Presentation
Accumulated deficit	$ 279,844	$ 237,265

Summary of Significant Accounting Policies - Restricted Cash (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2017	Dec. 31, 2016
Restricted Cash
Certificate of deposit	$ 1,614	$ 1,614	$ 1,728	$ 1,728
Certificates of Deposit
Restricted Cash
Certificate of deposit	$ 1,614	$ 1,614

Summary of Significant Accounting Policies - ASU 2016-18 (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2017	Dec. 31, 2016
Reconciliation of the cash, cash equivalents, and restricted cash reported within the balance sheet that sum to the total of the same amounts shown in the statement of cash flows:
Cash and cash equivalents	$ 56,861	$ 41,538	$ 51,165	$ 32,936
Restricted cash	1,614	1,614	1,728	1,728
Total cash, cash equivalents and restricted cash as shown on the statement of cash flow	$ 58,475	$ 43,152	$ 52,893	$ 34,664

Fair Value of Financial Assets and Liabilities - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Recurring Basis - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Assets:
Total assets at fair value	$ 50,163	$ 40,386
Money Market Funds
Assets:
Cash equivalents	50,163	40,386
Level 2
Assets:
Total assets at fair value	50,163	40,386
Level 2 \| Money Market Funds
Assets:
Cash equivalents	$ 50,163	$ 40,386

Fair Value of Financial Assets and Liabilities - Additional Information (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2018 USD ($)
Fair Value of Financial Assets and Liabilities
Transfers between fair value measurement levels	$ 0

Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Income Taxes
Unrecognized tax benefits	$ 0	$ 0
Accrued interest or tax penalties related to income taxes	$ 0	$ 0

Collaboration and Feasibility Agreements - Additional Information (Details) - Collaboration Agreement - Regeneron $ in Thousands	1 Months Ended
	Oct. 31, 2016 USD ($)
Collaboration and Feasibility Agreements
Payment receivable upon exercise of option	$ 10,000
Maximum
Collaboration and Feasibility Agreements
Reimbursable clinical development costs	25,000
Potential increase in reimbursable clinical development costs	5,000
Potential payment receivable per Licensed Product upon the achievement of specified development and regulatory milestones	145,000
Potential payment receivable per Licensed Product upon first commercial sale of such Licensed Product	100,000
Potential payment receivable due for achievement of specified sales milestones for all Licensed Products	$ 50,000

Notes Payable - Additional Information (Details) - Amended Credit Facility - USD ($) $ in Thousands	1 Months Ended	9 Months Ended
	Mar. 31, 2017	Sep. 30, 2018	Dec. 31, 2017
Notes Payable
Outstanding borrowings	$ 18,000
Outstanding borrowings, Effective annual interest rate (as a percent)		10.50%
Repayments of debt	14,300
Repayments of debt, Principal		$ 13,886
Repayments of debt, Interest		630
Additional final payment		630
Outstanding borrowings under credit facility, net of unamortized discount		$ 14,167	$ 18,016
Net proceeds from credit facility	$ 3,700
Final payment due (as a percent)	3.50%
LIBOR
Notes Payable
Interest rate floor (as a percent)	1.00%
Basis spread (as a percent)	7.25%
Indicative interest rate (as a percent)	8.25%

Notes Payable - Schedule of Annual Repayment Requirements for Credit Facility (Details) - Amended Credit Facility - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Annual repayment requirements
Credit Facility, Principal	$ 13,886
Credit Facility, Interest and Final Payment	630
Credit Facility, Total	14,516
Interest
Interest paid	1,131	$ 1,075
2018
Annual repayment requirements
Credit Facility, Principal	1,544
Credit Facility, Total	1,544
2019
Annual repayment requirements
Credit Facility, Principal	6,171
Credit Facility, Total	6,171
2020
Annual repayment requirements
Credit Facility, Principal	6,171
Credit Facility, Interest and Final Payment	630
Credit Facility, Total	$ 6,801

Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands		1 Months Ended		3 Months Ended		9 Months Ended		23 Months Ended
	Nov. 30, 2016	Jan. 31, 2018	Jan. 31, 2017	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Dec. 31, 2017
Common Stock
Common stock, shares authorized				100,000,000		100,000,000		100,000,000	100,000,000
Net proceeds from issuance of common stock						$ 55,961	$ 28,657
Common Stock \| Follow-on Offering
Common Stock
Common stock, price per share		$ 5.00	$ 7.00
Number of shares issued		7,475,000	3,571,429
Net proceeds from issuance of common stock		$ 34,704	$ 23,261
Common Stock \| 2016 ATM Agreement
Common Stock
Maximum aggregate proceeds from offering	$ 40,000
Number of shares issued				2,026,031	258,860	3,192,566	690,999	4,083,134
Net proceeds from issuance of common stock				$ 12,852	$ 1,573	$ 21,241	$ 5,384	$ 27,844
Aggregate value available for issuance				$ 10,864		$ 10,864		$ 10,864

Net Loss Per Share - Basic and Diluted Net Loss Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Basic and diluted net loss per share attributable to common stockholders:
Net loss attributable to common stockholders	$ (15,010)	$ (15,567)	$ (42,579)	$ (50,284)
Weighted average common shares outstanding, basic and diluted	39,017,922	29,087,654	37,111,200	28,601,179
Net loss per share attributable to common stockholders, basic and diluted	$ (0.38)	$ (0.54)	$ (1.15)	$ (1.76)

Net Loss Per Share - Schedule of Antidilutive Securities, Excluded from Computation of Diluted Net Loss per Share (Details) - shares	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total common stock equivalents	5,194,742	4,125,702
Options to Purchase Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total common stock equivalents	5,175,803	4,106,763
Common Stock \| Warrant
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total common stock equivalents	18,939	18,939

Stock-Based Awards - Additional Information (Detail) - Common Stock - shares	9 Months Ended
	Sep. 30, 2018	Jan. 01, 2018
2014 Stock Incentive Plan
Stock-Based Awards
Increased number of shares of common stock reserved for issuance		1,186,328
Number of shares of common stock available for issuance	1,649,106
2014 Employee Stock Purchase Plan
Stock-Based Awards
Increased number of shares of common stock reserved for issuance		148,291
Number of shares of common stock available for issuance	453,824
Issuance of common stock in connection with employee stock purchase plan, shares	29,141

Stock-Based Awards - Inducement Stock Option Awards (Detail) - Non-statutory Stock Option - Management	Jun. 20, 2017 $ / shares shares
Stock-Based Awards
Shares Issuable Under Options, Granted \| shares	590,000
Exercise price (in dollars per share) \| $ / shares	$ 10.94
Vesting period	4 years
Percentage of shares underlying the option award vesting on first anniversary	25.00%
Percentage of shares underlying the option award vesting monthly after the first anniversary	75.00%

Stock-Based Awards - Stock-Based Compensation Expense and Other (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Stock-based Compensation
Stock-based compensation expense	$ 1,873	$ 1,751	$ 5,534	$ 5,212
Unrecognized stock-based compensation cost	$ 12,789		$ 12,789
Weighted average period of unrecognized stock-based compensation cost expected to be recognized			2 years 7 months 6 days
Unvested service-based stock options held by nonemployees	17,084		17,084
Research and Development Expense
Stock-based Compensation
Stock-based compensation expense	$ 627	563	$ 1,853	1,674
Selling and Marketing Expense
Stock-based Compensation
Stock-based compensation expense	116	59	343	527
General and Administrative Expense
Stock-based Compensation
Stock-based compensation expense	$ 1,130	$ 1,129	$ 3,338	$ 3,011

Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Thousands	1 Months Ended	33 Months Ended
	Oct. 31, 2016	Sep. 30, 2018
Incept
Commitments and Contingencies
Payments for Royalties		$ 199
Regeneron \| Collaboration Agreement \| Maximum
Commitments and Contingencies
Reimbursable clinical development costs	$ 25,000
Potential increase in reimbursable clinical development costs	$ 5,000

Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Incept \| Chief Executive Officer
Related Party Transactions
Ownership interest in related party by board member (as a percent)	50.00%	50.00%
Axtria \| Master Service Agreement \| Board of Director
Related Party Transactions
Expenses incurred			$ 864
Accounts payable	$ 0	$ 0		$ 0
McCarter \| Legal Fees \| Senior Vice President
Related Party Transactions
Expenses incurred	155	376
Accrued expenses	$ 65	$ 65

Restructuring and Other Costs - Summary (Details) $ in Thousands		3 Months Ended
	Jul. 31, 2017 position	Dec. 31, 2017 USD ($)	Sep. 30, 2017 USD ($)
Ankerud Transition Agreement
Restructuring and other costs
Severance expense			$ 386
Fortune Transition Agreement
Restructuring and other costs
Severance expense		$ 417
Accrued bonus		$ 62
Elimination of portion of Company's workforce
Positions eliminated
Number of positions eliminated \| position	30
Restructuring and other costs
Restructuring and other costs			$ 1,703

Restructuring and Other Costs - Reserve (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2018 USD ($)
Reserve
Restructuring and other costs reserve beginning balance	$ 960
Amounts paid during the period	(822)
Restructuring and other costs reserve ending balance	$ 138

Subsequent Event - Additional Information (Detail) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended		23 Months Ended
	Oct. 31, 2018	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Nov. 02, 2018
Subsequent Events
Net proceeds from issuance of common stock				$ 55,961	$ 28,657
Common Stock \| 2016 ATM Agreement
Subsequent Events
Number of shares issued		2,026,031	258,860	3,192,566	690,999	4,083,134
Net proceeds from issuance of common stock		$ 12,852	$ 1,573	$ 21,241	$ 5,384	$ 27,844
Aggregate value available for issuance		$ 10,864		$ 10,864		$ 10,864
Subsequent Event \| Common Stock \| 2016 ATM Agreement
Subsequent Events
Number of shares issued	562,309
Net proceeds from issuance of common stock	$ 3,602
Aggregate value available for issuance							$ 7,170