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Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Dec. 31, 2018	Mar. 01, 2019	Jun. 29, 2018
Document and Entity Information
Entity Registrant Name	Scholar Rock Holding Corp
Entity Central Index Key	0001727196
Document Type	10-K
Document Period End Date	Dec. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Public Float			$ 127.2
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		26,219,288
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	FY

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 115,069	$ 56,461
Marketable securities	60,576	1,498
Prepaid expenses and other current assets	2,296	1,242
Total current assets	177,941	59,201
Property and equipment, net	3,190	2,181
Restricted cash	205	205
Other long-term assets		50
Total assets	181,336	61,637
Current liabilities:
Accounts payable	3,303	1,359
Accrued expenses	7,157	2,796
Deferred rent	16	228
Loan and capital lease payable	438	641
Deferred revenue	20,209
Total current liabilities	31,123	5,024
Long-term portion of deferred rent	871	468
Long-term portion of loan and capital lease payable	24	398
Warrant to purchase redeemable security		37
Long-term portion of deferred revenue	42,695
Total liabilities	74,713	5,927
Commitments and contingencies (Note 16)
Convertible preferred stock (Series A-1, A-2, A-3, A-4, B and C), $0.001 par value; no shares authorized, issued or outstanding as of December 31, 2018; 43,157,651 shares authorized and 43,135,911 shares issued and outstanding as of December 31, 2017 (aggregate liquidation preference of $109,561 as of December 31, 2017).		109,232
Stockholders’ equity (deficit):
Preferred stock, $0.001 par value; 10,000,000 and no shares authorized at December 31, 2018 and December 31, 2017, respectively; no shares issued and outstanding at December 31, 2018 and December 31, 2017, respectively
Common stock, $0.001 par value; 150,000,000 shares authorized and 26,217,701 shares issued and outstanding as of December 31, 2018; 60,000,000 shares authorized and 3,970,586 shares issued and outstanding as of December 31, 2017	26	4
Additional paid-in capital	213,453	4,001
Accumulated other comprehensive loss	(8)	(2)
Accumulated deficit	(106,848)	(57,525)
Total stockholders’ equity (deficit)	106,623	(53,522)
Total liabilities, convertible preferred stock and stockholders’ equity (deficit)	$ 181,336	$ 61,637

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Convertible preferred stock, par value	$ 0.001	$ 0.001
Convertible preferred stock, shares authorized	0	43,157,651
Convertible preferred stock, shares issued	0	43,135,911
Convertible preferred stock, shares outstanding	0	43,135,911
Aggregate liquidation preference		$ 109,561
Common unit, shares outstanding		0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	150,000,000	60,000,000
Common stock, shares issued	26,217,701	3,970,586
Common stock, shares outstanding	26,217,701	3,970,586

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Operating expenses:
Research and development	$ 36,310	$ 19,944
General and administrative	14,382	5,085
Total operating expenses	50,692	25,029
Loss from operations	(50,692)	(25,029)
Other income (expense):
Interest income, net	1,422	44
Other expense, net	(56)	(10)
Total other income (expense)	1,366	34
Net loss	$ (49,326)	$ (24,995)
Net loss per share, basic and diluted (in dollars per share)	$ (3.15)	$ (15.30)
Weighted average common shares outstanding, basic and diluted (in shares)	15,655,293	1,634,100
Comprehensive loss:
Net loss	$ (49,326)	$ (24,995)
Other comprehensive income (loss):
Unrealized gain (loss) on marketable securities	(6)	18
Total other comprehensive income (loss)	(6)	18
Comprehensive loss	$ (49,332)	$ (24,977)

CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) - USD ($) $ in Thousands	Common Units	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Total
Balance at beginning at Dec. 31, 2016	$ 1,471		$ 1,052	$ (20)	$ (32,530)	$ (30,027)
Balance at beginning (in shares) at Dec. 31, 2016	1,603,088
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Unrealized gain (loss) on marketable securities				18		18
Effect of Reorganization	$ (1,471)	$ 2	1,469
Effect of Reorganization (in shares)	(1,603,088)	1,603,088
Issuance of common stock and restricted common stock as part of Reorganization		$ 2	(2)
Issuance of common stock and restricted common stock as part of Reorganization (in shares)		2,367,498
Equity-based compensation expense			1,482			1,482
Net loss					(24,995)	(24,995)
Balance at end at Dec. 31, 2017		$ 4	4,001	(2)	(57,525)	(53,522)
Balance at end (in shares) at Dec. 31, 2017		3,970,586
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Unrealized gain (loss) on marketable securities				(6)		(6)
Reclassification of warrant to stockholders' equity			93			93
Conversion of convertible preferred stock into common stock		$ 15	109,217			109,232
Conversion of convertible preferred stock into common stock (in shares)		15,109,950
Sale of common shares sold in IPO, net of offering costs		$ 6	77,833			77,839
Sale of common shares sold in IPO, net of offering costs (in shares)		6,164,000
Sale of common shares		$ 1	17,095			17,096
Sale of common shares (in shares)		980,392
Restricted shares forfeited during the period (in shares)		(8,125)
Exercise of stock options			6			6
Exercise of stock options (in shares)		898
Equity-based compensation expense			5,211			5,211
Cumulative effective adjustment for ASU 2018-07			(3)		3
Net loss					(49,326)	(49,326)
Balance at end at Dec. 31, 2018		$ 26	$ 213,453	$ (8)	$ (106,848)	$ 106,623
Balance at end (in shares) at Dec. 31, 2018		26,217,701

CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) - Temporary Equity - USD ($) $ in Thousands	Convertible preferred units	Convertible preferred stock	Total
Balance, beginning at Dec. 31, 2016	$ 58,057
Balance, beginning (in shares) at Dec. 31, 2016	28,652,147
Convertible preferred equity
Issuance of convertible preferred values	$ 4,285	$ 46,890
Issuance of convertible preferred share (in shares)	1,428,209	13,055,555
Effect of Reorganization	$ (62,342)	$ 62,342
Effect of Reorganization (in shares)	(30,080,356)	30,080,356
Balance, end at Dec. 31, 2017		$ 109,232	$ 109,232
Balance, end (in shares) at Dec. 31, 2017		43,135,911	43,135,911
Convertible preferred equity
Conversion of convertible preferred stock into common stock		$ (109,232)	$ 109,232
Conversion of convertible preferred stock into common stock (in shares)		(43,135,911)
Balance, end (in shares) at Dec. 31, 2018			0

CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) (Parenthetical) - USD ($) $ in Thousands		12 Months Ended
	Dec. 22, 2017	Dec. 31, 2017
Series C convertible preferred stock
Stock issuance cost	$ 100	$ 109

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities:
Net loss	$ (49,326)	$ (24,995)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	807	669
Equity-based compensation	5,211	1,482
Amortization of investment securities	(345)	(9)
Deferred payroll tax credit	272	(199)
Change in fair value of warrant liability	56	10
Change in operating assets and liabilities:
Prepaid expenses and other current assets	(1,276)	(477)
Accounts payable	1,664	636
Accrued expenses	4,361	1,309
Other Liabilities	52	46
Deferred revenue	62,904
Deferred rent	191	(209)
Net cash provided by (used in) operating activities	24,571	(21,737)
Cash flows from investing activities:
Purchase of property and equipment	(1,492)	(361)
Purchase of marketable securities	(75,239)
Sales and maturities of marketable securities	16,500	18,026
Net cash (used in) provided by investing activities	(60,231)	17,665
Cash flows from financing activities:
Principal payments on loan and capital lease payable	(673)	(667)
Proceeds from initial public offering of common stock, net of issuance costs	77,839
Proceeds from sale of common stock	17,096
Proceeds from issuance of Series B convertible preferred units		4,285
Proceeds from issuance of Series C convertible preferred shares, net of issuance costs		46,890
Proceeds from stock option exercises	6
Other		(8)
Net cash provided by financing activities	94,268	50,500
Net increase in cash and cash equivalents and restricted cash	58,608	46,428
Cash and cash equivalents and restricted cash, beginning of period	56,666	10,238
Cash and cash equivalents and restricted cash, end of period	115,274	56,666
Supplemental disclosure of non-cash items:
Property and equipment purchases in accounts payable	439	159
Supplemental cash flow information:
Cash paid for interest	34	$ 53
Purchase under capital lease	$ 44

Nature of the Business and Basis of Presentation

12 Months Ended

Dec. 31, 2018

Nature of the Business and Basis of Presentation

Nature of the Business and Basis of Presentation

SCHOLAR ROCK HOLDING CORPORATION

Notes to Consolidated Financial Statements

Nature of the Business and Basis of Presentation

Organization

Scholar Rock Holding Corporation (the “Company”) is a biopharmaceutical company focused on the discovery and development of innovative medicines for the treatment of serious diseases in which signaling by protein growth factors plays a fundamental role. The Company’s lead product candidate, SRK-015, is a novel, highly selective inhibitor of the activation of the growth factor myostatin in skeletal muscle that the Company has advanced into clinical development for the treatment of spinal muscular atrophy. The Company’s second product candidate is SRK-181, and is being developed for the treatment of cancers resistant to checkpoint blockade therapies. The Company was originally formed as a Delaware limited liability company in May 2012. In December 2017, the Company converted into a Delaware corporation through a series of transactions (the “Reorganization”). Its principal offices are in Cambridge, Massachusetts.

Since its inception, the Company’s operations have focused on research and development of monoclonal antibodies that selectively inhibit activation of growth factors for therapeutic effect, as well as establishing the Company’s intellectual property portfolio and performing research and development activities. The Company has primarily financed its operations through various equity and debt financings, including the initial public offering of its common stock (the “IPO”) in May 2018, as well as research and development collaboration agreements.

Revenue generation activities have been limited to two collaborations, both containing research services and the issuance of a license. The first agreement, executed in 2013 was with Janssen Biotech, Inc. (“Janssen”), a subsidiary of Johnson & Johnson. The second agreement, executed in December 2018 was with Gilead Sciences, Inc. (“Gilead”), and we will begin recognizing revenue on the Gilead Collaboration Agreement in 2019. No revenues have been recorded from the sale of any commercial product.

During the second quarter of 2018, the Company completed its IPO, in which the Company sold 6,164,000 shares of common stock, including all additional shares available to cover over-allotments, at a price of $14.00 per share. The Company received aggregate net proceeds of approximately $77.8 million, after deducting underwriting discounts and commissions and other offering expenses payable by the Company. Upon the closing of the IPO, all outstanding shares of convertible preferred stock converted into 15,109,950 shares of common stock and the Company’s outstanding warrant to purchase preferred stock converted into a warrant to purchase 7,614 shares of common stock.

The Company is subject to a number of risks similar to other life science companies, including, but not limited to, successful discovery and development of its drug candidates, raising additional capital, development by its competitors of new technological innovations, protection of proprietary technology and regulatory approval and market acceptance of the Company’s products. The Company anticipates that it will continue to incur significant operating losses for the next several years as it continues to develop its product candidates. The Company believes that its existing cash and cash equivalents, and marketable securities at December 31, 2018 will be sufficient to allow the Company to fund its current operations through at least a period of one year after the date the financial statements are issued.

Basis of Presentation

The consolidated financial statements prior to the Reorganization include the accounts of Scholar Rock, LLC and its wholly owned subsidiary, Scholar Rock, Inc. The consolidated financial statements subsequent to the Reorganization include the accounts of Scholar Rock Holding Corporation and its wholly owned subsidiaries. All intercompany balances have been eliminated in consolidation.

These consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”).

The Company’s Board of Directors and stockholders approved a 2.8548‑to‑one reverse stock split of the Company’s issued and outstanding shares of common stock that became effective on May 11, 2018. All unit, per unit, common share and per common share amounts in the consolidated financial statements and notes thereto have been retrospectively adjusted for all periods presented to give effect of the reverse stock split.

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 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 accordance with GAAP requires management to make estimates and judgments that may affect the reported amounts of assets and liabilities and related disclosures of contingent assets and liabilities at the date of the financial statements and the related reporting of revenues and expenses during the reporting period. Significant estimates of accounting reflected in these consolidated financial statements include, but are not limited to, estimates related to revenue recognition, research and development, accrued expenses, the valuation of equity-based compensation, including incentive units, common stock, restricted common stock and stock options, and income taxes. Actual results could differ from those estimates.

Prior to the IPO, the Company utilized significant estimates and assumptions in determining the fair value of its equity-based compensation, including incentive units, common stock, restricted common stock and stock options. The Company utilized various valuation methodologies in accordance with the framework of the 2013 American Institute of Certified Public Accountants Technical Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation, to estimate the fair value of its equity awards. Each valuation methodology included estimates and assumptions that required the Company’s judgment. These estimates and assumptions included a number of objective and subjective factors, including external market conditions, guideline public company information, the prices at which the Company sold convertible preferred units and convertible preferred stock, the superior rights and preferences of securities senior to the Company’s common units and common stock at the time and the likelihood of achieving a liquidity event such as an initial public offering or sale. Significant changes to the assumptions used in the valuations could have resulted in different fair values of common units, incentive units, common stock, restricted common stock and stock options at each valuation date, as applicable.

Concentration of Credit Risk and Off-Balance Sheet Risk

The Company has no off-balance sheet risk, such as foreign exchange contracts, option contracts or other foreign-hedging arrangements. The primary objectives for the Company’s investment portfolio are the preservation of capital and maintenance of liquidity. The Company invests only in fixed income instruments denominated and payable in U.S. dollars including obligations of the U.S. government and its agencies and money market funds registered according to SEC Rule 2a‑7 of the Investment Company Act of 1940. Investments in the money market fund shall be consistent with approved instruments and assets under management must be at least $10 billion. All securities must have a readily ascertainable market value, must be readily marketable and be U.S. dollar denominated.

Cash and Cash Equivalents and Restricted Cash

The Company considers highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Cash equivalents are stated at cost, which approximates market value. At December 31, 2018 and 2017, cash equivalents include money market funds that invest primarily in U.S. government-backed securities and treasuries.

Restricted cash consists of a letter of credit in the amount of $0.2 million issued to the landlord of the Company’s facility lease. The terms of the letter of credit extend beyond one year. As such, it is classified as a long-term asset in the Company’s consolidated financial statements. The following table reconciles cash and cash equivalents and restricted cash per the balance sheet to the statement of cash flows:


	As of December 31,
	2018		2017
Cash and cash equivalents	$	115,069	$	56,461
Restricted cash		205		205
	$	115,274	$	56,666

Property and Equipment

Property and equipment are recorded at cost. Expenditures for major renewals or betterments that extend the useful lives of property and equipment are capitalized; expenditures for maintenance and repairs are charged to expense as incurred. Depreciation is calculated on a straight-line basis over the estimated useful lives of the related asset. Property and equipment are depreciated as follows:


		Estimated Useful Life
		(in Years)
Laboratory equipment		3 - 5
Machinery and equipment		3 - 5
Furniture and fixtures		5
Leasehold improvements		Shorter of the useful life or remaining lease term

Impairment of Long-Lived Assets

Long-lived assets consist of property and equipment. Long-lived assets to be held and used are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets. If an impairment review is performed to evaluate a long-lived asset group for recoverability, the Company compares forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long-lived asset group to its carrying value. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of an asset group are less than its carrying amount. The impairment loss would be based on the excess of the carrying value of the impaired asset group over its fair value, determined based on discounted cash flows. The Company did not record any impairment losses on long-lived assets during the years ended December 31, 2018 or 2017.

Fair Value Measurements

ASC Topic 820, Fair Value Measurement ("ASC 820"), establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. ASC 820 identifies fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a three-tier fair value hierarchy that distinguishes between the following:

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

Level 2 — Inputs other than Level 1 inputs that are either directly or indirectly observable, such as quoted market prices, interest rates and yield curves.

Level 3 — Unobservable inputs developed using estimates of assumptions developed by the Company, which reflect those that a market participant would use.

To the extent the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair values requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized as Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

Segment Information

Operating segments are defined as components of an entity about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company views its operations and manages its business in one operating segment operating exclusively in the U.S.

Revenue Recognition

The Company accounts for revenue using the provisions of ASC 606. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine the appropriate amount of revenue to be recognized for arrangements determined to be within the scope of ASC 606, the Company performs the following five steps: (i) identification of the contract(s) with the customer, (ii) identification of the promised goods or services in the contract and determination of whether the promised goods or services are performance obligations, (iii) measurement of the transaction price, (iv) allocation of the transaction price to the performance obligations, and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The Company accounts for a contract with a customer that is within the scope of ASC 606 when all of the following criteria are met: (i) the arrangement has been approved by the parties and the parties are committed to perform their respective obligations, (ii) each party’s rights regarding the goods or services to be transferred can be identified, (iii) the payment terms for the goods or services to be transferred can be identified, (iv) the arrangement has commercial substance and (v) collection of substantially all of the consideration to which the Company will be entitled in exchange for the goods or services that will be transferred to the customer is probable.

The Company first evaluates license and/or collaboration arrangements to determine whether the arrangement (or part of the arrangement) represents a collaborative arrangement pursuant to ASC Topic 808, Collaborative Arrangements, based on the risks and rewards and activities of the parties pursuant to the contractual arrangement. The Company accounts for collaborative arrangements (or elements within the contract that are deemed part of a collaborative arrangement), which represent a collaborative relationship and not a customer relationship, outside of the scope of ASC 606. The Company’s existing collaborations represent revenue arrangements.

For the arrangements or arrangement components that are subject to revenue accounting guidance, in determining the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. As part of the accounting for these arrangements, the Company must use significant judgment to determine: a) the number of performance obligations based on the determination under step (ii) above and whether those performance obligations are distinct from other performance obligations in the contract; b) the transaction price under step (iii) above; and c) the standalone selling price for each performance obligation identified in the contract for the allocation of transaction price in step (iv) above. The Company uses judgment to determine whether milestones or other variable consideration, except for royalties, should be included in the transaction price as described further below. The transaction price is allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. In determining the stand-alone selling price of a license to the Company’s proprietary technology or a material right provided by a customer option, the Company considers market conditions as well as entity-specific factors, including those factors contemplated in negotiating the agreements as well as internally developed estimates that include assumptions related to the market opportunity, estimated development costs, probability of success and the time needed to commercialize a product candidate pursuant to the license. In validating its estimated stand-alone selling prices, the Company evaluates whether changes in the key assumptions used to determine its estimated stand-alone selling prices will have a significant effect on the allocation of arrangement consideration between performance obligations.

The Company estimates the transaction price based on the amount of consideration the Company expects to be received for transferring the promised goods or services in the contract. The consideration may include both fixed consideration and variable consideration. At the inception of each arrangement that includes variable consideration, the Company evaluates the amount of the potential payments and the likelihood that the payments will be received. The Company utilizes either the most likely amount method or expected value method to estimate the transaction price based on which method better predicts the amount of consideration expected to be received. If it is probable that a significant revenue reversal would not occur, the variable consideration is included in the transaction price.

Performance obligations are promised goods or services in a contract to transfer a distinct good or service to the customer. Promised goods or services are considered distinct when: (i) the customer can benefit from the good or service on its own or together with other readily available resources and (ii) the promised good or service is separately identifiable from other promises in the contract. In assessing whether promised goods or services are distinct, the Company considers factors such as the stage of development of the underlying intellectual property, the capabilities of the customer to develop the intellectual property on their own and whether the required expertise is readily available.

The Company allocates the transaction price based on the estimated standalone selling price. The Company must develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract. The Company utilizes key assumptions to determine the standalone selling price, which may include other comparable transactions, pricing considered in negotiating the transaction and the estimated costs. Certain variable consideration is allocated specifically to one or more performance obligations in a contract when the terms of the variable consideration relate to the satisfaction of the performance obligation and the resulting amounts allocated to each performance obligation are consistent with the amounts the Company would expect to receive for each performance obligation.

For performance obligations which consist of licenses and other promises, the Company utilizes judgment to assess the nature of the combined performance obligation in order to determine whether the combined performance obligation is satisfied over time or at a point in time. The Company determines the appropriate method of measuring progress of combined performance obligations satisfied over time for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company will recognize revenue from non-refundable, up-front fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. The Company receives payments from customers based on billing schedules established in each contract. Up-front payments and fees are recorded as deferred revenue upon receipt or when due until the Company performs its obligations under these arrangements. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current portion of deferred revenue in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Amounts are recorded as accounts receivable when the Company’s right to consideration is unconditional. Amounts recognized as revenue, but not yet received or invoiced are generally recognized as contract assets.

Exclusive Licenses – If the license granted in the arrangement is determined to be distinct from the other promises or performance obligations identified in the arrangement, which generally include research and development services, the Company recognizes revenue from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. In assessing whether a license is distinct from the other promises, the Company considers relevant facts and circumstances of each arrangement, including the research and development capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the collaboration partner can benefit from the license for its intended purpose without the receipt of the remaining promise, whether the value of the license is dependent on the unsatisfied promise, whether there are other vendors that could provide the remaining promise, and whether it is separately identifiable from the remaining promise. For licenses that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The measure of progress, and thereby periods over which revenue should be recognized, are subject to estimates by management and may change over the course of the arrangement.

Research and Development Services – The promises under the Company’s collaboration and license agreements generally include research and development services to be performed by the Company on behalf of the collaboration partner. For performance obligations that include research and development services, the Company generally recognizes revenue allocated to such performance obligations based on an appropriate measure of progress. The Company utilizes judgment to determine the appropriate method of measuring progress for purposes of recognizing revenue, which is generally an input measure, such as costs incurred. The Company evaluates the measure of progress each reporting period as described under Exclusive Licenses above. Reimbursements from the partner that are the result of a collaborative relationship with the partner, instead of a customer relationship, such as co-development activities, are generally recorded as a reduction to research and development expense.

Customer Options – The Company’s arrangements may provide a collaborator with the right to certain optional purchases, such as the right to license a target either at the inception of the arrangement or within a pre-defined option period. Under these agreements, fees may be due to the Company (i) at the inception of the arrangement as an upfront fee or payment or (ii) upon the exercise of an option to acquire a license. If an arrangement is determined to contain customer options that allow the customer to acquire additional goods or services, the goods and services underlying the customer options are not considered to be performance obligations at the outset of the arrangement, as they are contingent upon option exercise. The Company evaluates the customer options for material rights, or options to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the inception of the arrangement. The Company allocates the transaction price to material rights based on the relative stand-alone selling price, which is determined based on the identified discount, and the probability that the customer will exercise the option. Amounts allocated to a material right are not recognized as revenue until, at the earliest, the option is exercised or expires.

Milestone Payments – At the inception of each arrangement that includes milestone payments based on certain events, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone in making this assessment. There is considerable judgment involved in determining whether it is probable that a significant revenue reversal would not occur. At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. If a milestone or other variable consideration relates specifically to the Company’s efforts to satisfy a single performance obligation or to a specific outcome from satisfying the performance obligation, the Company generally allocates the milestone amount entirely to that performance obligation once it is probable that a significant revenue reversal would not occur.

Royalties – For arrangements that include sales-based royalties, including milestone payments based on a level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized any royalty revenue resulting from any of its licensing arrangements.

For a complete discussion of accounting for collaboration revenues, see Note 18, Agreements.

Research and Development Expenses and Accruals

Research and development expenses are expensed as incurred and consist of costs incurred in performing research and development activities, including compensation related expenses for research and development personnel, preclinical and clinical activities including cost of supply, overhead expenses including facilities expenses, materials and supplies, amounts paid to consultants and outside service providers, and depreciation of equipment. Upfront license payments related to acquired technologies which have not yet reached technological feasibility and have no alternative future use are also included in research and development expense.

The Company has entered into various research and development service arrangements under which vendors perform various services. The Company records accrued expenses for estimated costs incurred under the arrangements. When evaluating the adequacy of the accrued expenses, the Company analyzed the progress of the studies, trials or other services performed, including invoices received and contracted costs. Significant judgments and estimates are made in determining the accrued expense balances at the end of each reporting period.

Equity-Based Compensation

The Company accounts for equity awards, including common stock, restricted common stock, common stock options, and incentive units (prior to the Reorganization) granted to employees as equity award compensation in accordance with ASC Topic 718, Compensation — Stock Compensation ("ASC 718"). ASC 718 requires all stock-based payments to employees, which includes grants of employee equity awards, to be recognized as expense in the statements of operations based on their grant date fair values.

The Company estimated the fair value of incentive units and common stock using an appropriate valuation methodology, based on the guideline public company (GPC) method or the precedent transaction method which "backsolves" to a preferred price. The use of these valuation approaches requires management to make assumptions with respect to the expected volatility of its common units and common stock, time until a liquidity event and risk-free interest rates. The fair value of each restricted common stock award is based on the fair value of the Company’s common stock less any purchase price, if applicable. The fair value of each stock option award is estimated using the Black-Scholes option-pricing model, which uses as inputs the fair value of the Company’s common stock and certain subjective assumptions, including the expected stock price volatility, the expected term of the award, the risk-free rate, and expected dividends. Expected volatility is calculated based on reported volatility data for a representative group of publicly traded companies for which historical information was available. The historical volatility is generally calculated based on a period of time commensurate with the expected term assumptions. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant commensurate with the expected term assumption. The Company uses the simplified method, under which the expected term is presumed to be the midpoint between the vesting date and the end of the contractual term. The Company utilizes this method due to lack of historical exercise data and the plain nature of its stock based awards. The expected dividend yield is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on common stock.

Compensation expense related to equity awards to employees that are subject to graded vesting is recognized on a straight-line basis, based on the grant date fair value, over the requisite service period of the award, which is generally the vesting term. For awards subject to performance conditions, the Company recognizes equity award compensation expense using an accelerated recognition method over the remaining service period when management determines that achievement of the milestone is probable. Management evaluates when the achievement of a performance-based milestone is probable based on the relative satisfaction of the performance conditions as of the reporting date.

The Company adopted ASU No. 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”) in the fourth quarter of 2018. Refer to Recently Adopted Accounting Pronouncements below for further information. The standard expands the scope of ASC 718 to include all share-based payment arrangements related to the acquisition of goods and services from both non-employees and employees. Prior to the adoption of ASU 2018-07, for equity awards granted to non-employees, the Company accounted for the related equity award compensation in accordance with the provisions of ASC 718 and ASC Topic 505, Equity, and recognized equity award compensation expense over the related service period of the non-employee award. Equity awards issued to non-employees were recorded at their fair values, using the then-current fair value of the incentive units, common stock and updated assumption inputs in the Black-Scholes option-pricing model, as applicable, and were periodically revalued as the equity instruments vested. After the adoption of ASU 2018-07, equity-classified share-based payment awards issued to non-employees are measured at grant date fair value similarly to those of employees and are no longer revalued as the equity instruments vest. The new standard allows entities to use the expected term to measure non-employee options or elect to use the contractual term as the expected term, on an award-by-award basis.

The Company classifies equity-based compensation expense in its consolidated statements of operations in the same manner in which the award recipient’s salary and related costs are classified or in which the award recipient’s service payments are classified.

Pursuant to ASU 2016‑09, Improvements to Employee Share-Based Payment Accounting, the Company elected to account for forfeitures when they occur.

Convertible Preferred Units and Convertible Preferred Stock

The Company records all convertible preferred units or convertible preferred shares at their respective fair values on the dates of issuance less issuance costs. The Company classifies its convertible preferred units and convertible preferred shares outside of stockholders’ equity (deficit) when the redemption of such units or shares is outside the Company’s control. The Company does not adjust the carrying values of the convertible preferred units or convertible preferred stock to the liquidation preferences of such units or shares until such time as a deemed liquidation event is probable of occurring.

Comprehensive Loss

Comprehensive loss is the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. Comprehensive loss includes net loss and the change in accumulated other comprehensive loss for the period. Accumulated other comprehensive loss consisted entirely of unrealized gains and losses on available-for-sale marketable securities during the period ending December 31, 2018 and 2017.

Net Loss per Share

The Company applies the two-class method to compute basic and diluted net loss per share because it has issued shares that meet the definition of participating securities. The two-class method determines net income (loss) per share for each class of common and participating securities according to dividends declared or accumulated and participation rights in undistributed earnings. The two class method requires income (losses) available to common stockholders for the period to be allocated between common and participating securities based upon their respective rights to share in the earnings as if all income (losses) for the period had been distributed. During periods of loss, there is no allocation required under the two-class method since the participating securities do not have a contractual obligation to fund the losses of the Company.

The Company calculates basic net loss per share by dividing net loss by the weighted average number of common shares outstanding, excluding restricted common stock. The Company calculates diluted net loss per share by dividing net loss by the weighted average number of common shares outstanding, as applicable, after giving consideration to the dilutive effect of convertible preferred stock, restricted common stock, warrants and stock options that are outstanding during the period. The Company has generated a net loss in all periods presented, so the basic and diluted net loss per share are the same, as the inclusion of the potentially dilutive securities would be anti-dilutive.

Income Taxes

Income taxes for Scholar Rock Holding Corporation and Scholar Rock, Inc. are recorded in accordance with ASC Topic 740, Income Taxes ("ASC 740"), which provides for deferred taxes using an asset and liability approach. Under this method, deferred income tax assets and liabilities are recognized based on future income tax consequences attributable to differences between the financial statement carrying amount of existing assets and liabilities, and their respective income tax basis. Deferred income tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of changes in income tax rates on deferred income tax assets and liabilities is recognized as income or expense in the period that a valuation allowance for any income tax benefits of which future realization is not more likely than not.

The Company provides reserves for potential payments of tax to various tax authorities related to uncertain tax positions. The tax benefits recorded are based on a determination of whether and how much of a tax benefit taken by the Company in its tax filings or positions is "more likely than not" to be realized following resolution of any uncertainty related to the tax benefit, assuming that the matter in question will be raised by the tax authorities.

The Company is open to examination by the Internal Revenue Service for the tax years ended December 31, 2012 to December 31, 2018. Since the Company is in a U.S. loss carryforward position, carryforward tax attributes generated in prior years may still be adjusted upon future examination if they have or will be used in a future period. The Company is currently not under examination by the Internal Revenue Service or any other jurisdictions for any tax years. The Company has not recorded any interest or penalties on any unrecognized tax benefits since its inception.

Marketable Securities

The Company classifies its marketable securities as available-for-sale. Marketable securities with a remaining maturity date greater than one year are classified as non-current. Marketable securities are maintained by an investment manager and consist of U.S. treasury securities. Marketable securities are carried at fair value with the unrealized gains and losses included in accumulated other comprehensive loss as a component of stockholders’ equity (deficit) until realized. Any premium or discount arising at purchase is amortized and/or accreted to interest income and/or expense over the life of the underlying marketable security.

Although available to be sold to meet operating needs or otherwise, securities are generally held through maturity. The cost of securities sold is determined on a specific identification basis, and realized gains and losses are included in interest income (expense) within the statement of operations and comprehensive loss. During the years ended December 31, 2018 and 2017, there were no realized gains or losses on sales of marketable securities and no marketable securities were adjusted for other than temporary declines in fair value.

The Company evaluates its marketable securities with unrealized losses for other-than-temporary impairment. When assessing marketable securities for other-than-temporary declines in value, the Company considers such factors as, among other things, how significant the decline in value is as a percentage of the original cost, how long the market value of the investment has been less than its original cost, the Company’s ability and intent to retain the investment for a period of time sufficient to allow for any anticipated recovery in fair value and market conditions in general. If any adjustment to fair value reflects a decline in the value of the investment that the Company considers to be "other than temporary," the Company would reduce the investment to fair value through a charge to the statement of operations and comprehensive loss. No such adjustments were necessary during the periods presented.

Deferred Offering Costs

The Company capitalizes certain legal, professional accounting and other third-party fees that are directly associated with in-process equity financings as deferred offering costs until such financings are consummated. After consummation of the equity financing, these costs are recorded in stockholders’ equity (deficit) as a reduction of additional paid-in capital generated as a result of the offering. Should the planned equity financing be abandoned, the deferred offering costs will be expensed immediately as a charge to operating expenses in the consolidated statement of operations and comprehensive loss.

Recently Adopted Accounting Pronouncements

In June 2018, the FASB issued ASU No. 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”). The standard expands the scope of ASC 718 to include all share-based payment arrangements related to the acquisition of goods and services from both non-employees and employees. Under the amended guidance, equity-classified share-based payment awards issued to non-employees will be measured at grant date fair value. Upon transition, the entity is required to remeasure these non-employee awards at fair value as of the adoption date. The new standard is effective for the Company on January 1, 2019, with early adoption permitted. The Company adopted this new standard in the fourth quarter of 2018. The adoption date is the first day of the interim period in which an entity early adopts the guidance. Therefore, as we have adopted the guidance in our fourth quarter, the cumulative effect transition adjustment is calculated as of October 1, 2018 and recorded as an adjustment to retained earnings as of January 1, 2018 (the beginning of the annual period of adoption). An entity will not apply the new ASU to previously issued interim-period financial statements and will not restate those financial statements the next time they are presented. As a result of the adoption, the Company recognized an immaterial cumulative effect transition adjustment, which was recorded as an adjustment to retained earnings as of January 1, 2018.

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which supersedes all existing lease guidance. The new standard requires a company to recognize lease assets and liabilities for leases previously classified as operating leases. The new standard will be effective for the Company on January 1, 2019. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients primarily focused on leases that commenced before the effective date of Topic 842, including continuing to account for leases that commence before the effective date in accordance with previous guidance, unless the lease is modified. In July 2018, the FASB issued ASU 2018-11, which provides companies an additional, optional, transition method. This optional method allows companies to initially apply the standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. We expect to adopt the new standard and elect to use the cumulative effect adjustment transition option effective January 1, 2019, which will be the initial date of application per ASU 2018-11. The Company expects to elect the available package of practical expedients which allows us to not reassess previous accounting conclusions around whether arrangements are or contain leases, the classification of our leases, and the treatment of initial direct costs. The Company is continuing to evaluate the new lease guidance, has evaluated its existing population of contracts to identify the contracts that meet the definition of a lease contract under the new standard, and is in the process of finalizing the impact that the adoption of this guidance will have on its financial statements and footnote disclosures. The Company anticipates that adoption of this standard will result in an increase in assets and liabilities as the Company recognizes the right of use assets and obligations related to its leases.

In August 2018, the FASB issued ASU 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The new standard will align the requirements for capitalizing implementation costs for hosting arrangements (services) with costs for internal-use software (assets). As a result, certain implementation costs incurred in hosting arrangements will be deferred and amortized. The new standard will be effective for the Company on January 1, 2020. Early adoption is permitted. The Company is currently evaluating the potential impact that adoption of this standard may have on the Company's financial position and results of operations.

Fair Value of Financial Assets and Liabilities

12 Months Ended

Dec. 31, 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 summarize the assets and liabilities measured at fair value on a recurring basis at December 31, 2018 and 2017 (in thousands):


	Fair Value Measurements at December 31, 2018
	Total		Level 1		Level 2		Level 3
Assets:
Money market funds, included in cash and cash equivalents	$	114,593	$	114,593	$	—	$	—
Marketable securities:
U.S. Treasury obligations		60,576		60,576		—		—
Total assets	$	175,169	$	175,169	$	—	$	—


	Fair Value Measurements at December 31, 2017
	Total		Level 1		Level 2		Level 3
Assets:
Money market funds, included in cash and cash equivalents	$	55,291	$	55,291	$	—	$	—
Marketable securities:
U.S. Treasury obligations		1,498		1,498		—		—
Total assets	$	56,789	$	56,789	$	—	$	—
Liabilities:
Warrant to purchase redeemable security	$	37	$	—	$	—	$	37
Total liabilities	$	37	$	—	$	—	$	37

Cash and cash equivalents and marketable securities include investments in money market funds that invest in U.S. government securities that are valued using quoted market prices. Accordingly, money market funds and government funds are categorized as Level 1 as of December 31, 2018 and 2017. There were no transfers of assets between fair value measurement levels during the years ended December 31, 2018 and 2017.

The carrying amounts reflected in the balance sheets for accounts receivable, prepaid expenses and other current assets, accounts payable, and accrued expenses approximate their fair values at December 31, 2018 and 2017, due to their short-term nature. The Company believes the terms of the loan payable reflect current market conditions for an instrument with similar terms and maturity, therefore the carrying value of the Company’s debt approximates its fair value based on Level 3 of the fair value hierarchy.

Warrants to Purchase Convertible Preferred Units or Stock Subject to Redemption

In conjunction with the loan and security agreement, the Company issued a warrant to SVB. The Company determined that the warrant represented an instrument to purchase a redeemable security, and, therefore, was required to be classified as a liability on the balance sheet prior to the Company’s initial public offering. Because the warrant was classified as a liability, the liability was re-measured at its fair value at each balance sheet date. Changes in the fair value of the warrant, represented a recurring measurement and were classified within Level 3 of the fair value hierarchy, wherein fair value was estimated using significant unobservable inputs, and there were no material changes for any period presented.

Upon the completion of the IPO, the Company’s outstanding warrant to purchase preferred stock converted into a warrant to purchase common stock and the Company reclassified the fair value of the warrant to additional paid-in capital. As of December 31, 2018, the warrant is currently exercisable for 7,614 shares of our common stock at an exercise price of $3.94 per share.

- 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

Marketable Securities

12 Months Ended

Dec. 31, 2018

Marketable Securities

Marketable Securities

4. Marketable Securities

The following table summarizes the Company’s investments as of December 31, 2018 (in thousands):


			Gross
	Amortized		Unrealized				Estimated
	Cost		Gains		Losses		Fair Value
Marketable securities available-for-sale:
U.S. Treasury obligations	$	60,584	$	—	$	(8)	$	60,576
Total available-for-sale securities	$	60,584	$	—	$	(8)	$	60,576

The following table summarizes the Company’s investments as of December 31, 2017 (in thousands):


			Gross
	Amortized		Unrealized				Estimated
	Cost		Gains		Losses		Fair Value
Marketable securities available-for-sale:
U.S. Treasury obligations	$	1,500	$	—	$	(2)	$	1,498
Total available-for-sale securities	$	1,500	$	—	$	(2)	$	1,498

The aggregate fair value of marketable securities with unrealized losses was $60.6 million and $1.5 million at December 31, 2018 and 2017, respectively. At December 31, 2018 and 2017, 16 investments and one investment, respectively, were in an unrealized loss position. All such investments have been in an unrealized loss position for less than a year and these losses are considered temporary. The Company has the ability and intent to hold these investments until a recovery of their amortized cost.

Property and Equipment, Net

12 Months Ended

Dec. 31, 2018

Property and Equipment, Net

Property and Equipment, Net

5. Property and Equipment, Net

At December 31, 2018 and 2017, property and equipment consists of the following (in thousands):


	As of December 31,
	2018		2017
Laboratory equipment	$	3,585	$	2,074
Furniture & fixtures		219		151
Machinery & equipment		75		7
Leasehold improvements		1,578		1,498
Construction in progress		89		—
		5,546		3,730
Less: Accumulated depreciation and amortization		(2,356)		(1,549)
	$	3,190	$	2,181

Depreciation and amortization expense was $0.8 million and $0.7 million for the years ended December 31, 2018 and 2017, respectively.

As of December 31, 2018 and December 31, 2017, assets under capital lease with a cost basis of $44,000 and $0 were included in property and equipment, respectively.

Accrued Expenses

12 Months Ended

Dec. 31, 2018

Accrued Expenses

Accrued Expenses

6. Accrued Expenses

At December 31, 2018 and 2017, accrued expenses consist of the following (in thousands):


	As of December 31,
	2018		2017
Accrued payroll and related expenses	$	2,826	$	1,174
Accrued external research and development expense		3,284		1,225
Accrued professional and consulting expense		890		382
Accrued other		157		15
	$	7,157	$	2,796

Member Units	12 Months Ended
Member Units	Dec. 31, 2018
Member Units
Member Units	7. Member Units Prior to the Reorganization, all interests of members in distributions and other amounts were represented by their units of membership in the Company as specified in its operating agreement. There were two classes of units, capital units and incentive units. Capital units were comprised of common units and convertible preferred units, which represented a capital interest in the Company, while incentive units represent profits interests within the meaning of IRS Revenue Procedures 93‑27 and 2001‑43. The various classes of capital units are described below.

Common Units	12 Months Ended
Common Units	Dec. 31, 2018
Common Units
Common Units	8. Common Units As part of the Reorganization in December 2017, all common units were converted to common and restricted common stock. As a result, at December 31, 2017, there were no outstanding common units. Holders of common units were entitled to one vote per unit and received dividends, when and if declared by the Board of Directors. No common unit dividends were declared. The voting, dividend, and liquidation rights of the holders of the common units were subject to, and qualified by, the rights of the holders of the Series A Convertible Preferred Units and the Series B Convertible Preferred Units.

Convertible Preferred Units	12 Months Ended
Convertible Preferred Units	Dec. 31, 2018
Convertible Preferred Units
Convertible Preferred Units	9. Convertible Preferred Units Prior to the Reorganization in December 2017, the Company had sold Series A‑1, A‑2, A‑3, A‑4, and B Convertible Preferred Units, which were collectively considered the Convertible Preferred Units. Additional Series B Convertible Preferred Units were issued in May 2017. This additional tranche of 1,428,209 Series B Convertible Preferred Units shares resulted in proceeds of $4.3 million. As part of the Reorganization in December 2017, all Convertible Preferred Units were converted to Convertible Preferred Stock. Redemption The Company’s Convertible Preferred Units were classified as temporary equity in accordance with authoritative guidance for the classification and measurement of redeemable securities as the Convertible Preferred Units were redeemable upon the occurrence of a liquidation event. The carrying value of the Company’s Convertible Preferred Units was not adjusted because a liquidation event was not probable and did not occur. The Company evaluated the Convertible Preferred Units and determined that they were considered an "equity host" and not a "debt host." The evaluation was necessary to determine if any embedded features required bifurcation and separate accounting as a derivative financial instrument. The Company’s analysis was based on a consideration of the economic characteristics and risks and more specifically, evaluated all the stated and implied substantive terms and features including (i) whether the Convertible Preferred Unit included redemption features, (ii) how and when any redemption features could have been exercised, (iii) whether the Convertible Preferred Units were entitled to dividends, (iv) the voting rights of the Convertible Preferred Unit and (v) the existence and nature of any conversion rights. As a result of its evaluation that the Convertible Preferred Unit was an "equity host," the various embedded conversion options were not considered a separate, embedded derivative.

Reorganization and Convertible Preferred Stock

12 Months Ended

Dec. 31, 2018

Reorganization and Convertible Preferred Stock

Reorganization and Convertible Preferred Stock

10. Reorganization and Convertible Preferred Stock

In connection with the Reorganization:

Holders of Scholar Rock, LLC Series B Convertible Preferred Units received one share of Scholar Rock Holding Corporation Series B Convertible Preferred Stock for each outstanding Series B Convertible Preferred Units held immediately prior to the Reorganization, with an aggregate of 13,526,994 shares of Scholar Rock Holding Corporation Series B Convertible Preferred Stock issued in the Reorganization;

Holders of Scholar Rock, LLC Series A‑4 Convertible Preferred Units received one share of Scholar Rock Holding Corporation Series A‑4 Convertible Preferred Stock for each outstanding Series A‑4 Convertible Preferred Units held immediately prior to the Reorganization, with an aggregate of 3,906,738 shares of Scholar Rock Holding Corporation Series A‑4 Convertible Preferred Stock issued in the Reorganization;

Holders of Scholar Rock, LLC Series A‑3 Convertible Preferred Units received one share of Scholar Rock Holding Corporation Series A‑3 Convertible Preferred Stock for each outstanding Series A‑3 Convertible Preferred Units held immediately prior to the Reorganization, with an aggregate of 5,579,709 shares of Scholar Rock Holding Corporation Series A‑3 Convertible Preferred Stock issued in the Reorganization;

Holders of Scholar Rock, LLC Series A‑2 Convertible Preferred Units received one share of Scholar Rock Holding Corporation Series A‑2 Convertible Preferred Stock for each outstanding Series A‑2 Convertible Preferred Units held immediately prior to the Reorganization, with an aggregate of 5,066,915 shares of Scholar Rock Holding Corporation Series A‑2 Convertible Preferred Stock issued in the Reorganization;

Holders of Scholar Rock, LLC Series A‑1 Convertible Preferred Units received one share of Scholar Rock Holding Corporation Series A‑1 Convertible Preferred Stock for each outstanding Series A‑1 Convertible Preferred Units held immediately prior to the Reorganization, with an aggregate of 2,000,000 shares of Scholar Rock Holding Corporation Series A‑1 Convertible Preferred Stock issued in the Reorganization;

Holders of Scholar Rock, LLC Common Units received one share of Scholar Rock Holding Corporation common stock for each outstanding Common Unit held immediately prior to the Reorganization, with an aggregate of 1,603,088 shares of common stock issued;

Holders of Scholar Rock, LLC vested and unvested incentive units, irrespective of any strike price or voting rights on any such outstanding incentive units, exchanged one incentive unit for one share of common stock or restricted common stock, respectively. The restricted common stock was issued with the same vesting terms as the unvested incentive units held immediately prior to the Reorganization. An aggregate of 2,367,498 shares of common stock and restricted common stock were issued and

The outstanding warrant to purchase 21,739 shares of Series A‑3 Convertible Preferred Units at a purchase price of $1.38 per share was converted to a warrant to purchase 21,739 shares of Series A‑3 Convertible Preferred Stock at the same purchase price.

In evaluating the Reorganization, the Company considered that (i) with the exception of holders of Incentive Units, there were no changes in ownership interest held by each stockholder as a result of the Reorganization, (ii) the changes in the overall ownership interest of the Company resulting from the changes in ownership interest related to the holders of Incentive Units as a result of the Reorganization is not significant and (iii) the Reorganization occurred between a parent and wholly owned subsidiary, where the parent, Scholar Rock, LLC, had no substantive operations. Based on this evaluation, the Company determined that the Reorganization lacked economic substance and should be accounted for in a manner consistent with a common control transaction. Similarly, there was no change in fair value between the stockholders, individually or as a class, the Company determined that the exchange of shares occurring in the Reorganization should be accounted for as a modification of equity securities.

Convertible Preferred Stock	12 Months Ended
Convertible Preferred Stock	Dec. 31, 2018
Convertible Preferred Stock.
Convertible Preferred Stock	11. Convertible Preferred Stock On December 22, 2017, the Company entered into the Series C Preferred Stock Purchase Agreement pursuant to which the Company issued 13,055,555 shares of Series C Convertible Preferred Stock for proceeds of $46.9 million, net of issuance costs of $0.1 million. The Series A‑1, A‑2, A‑3, A‑4, B, and C Convertible Preferred Stock are collectively referred to as Convertible Preferred Stock. In conjunction with the IPO, all Convertible Preferred Stock was converted to common stock. The Company’s Convertible Preferred Stock had been classified as temporary equity on the accompanying consolidated 2017 balance sheet in accordance with authoritative guidance for the classification and measurement of redeemable securities as the Convertible Preferred Stock was redeemable upon the occurrence of a deemed liquidation event. The carrying value of the Company’s Convertible Preferred Stock was not being adjusted because a deemed liquidation event was not probable. The Company evaluated the Convertible Preferred Stock and determined that it should be considered an "equity host" and not a "debt host." The evaluation was necessary to determine if any embedded features require bifurcation and separate accounting as a derivative financial instrument. The Company’s analysis was based on a consideration of the economic characteristics and risks and more specifically, evaluated all the stated and implied substantive terms and features including (i) whether the Convertible Preferred Stock includes redemption features, (ii) how and when any redemption features could be exercised, (iii) whether the Convertible Preferred Stock is entitled to dividends, (iv) the voting rights of the Convertible Preferred Stock and (v) the existence and nature of any conversion rights. As a result of its evaluation that the Convertible Preferred Stock was an "equity host," the various embedded conversion options were not considered a separate, embedded derivative.

Preferred Stock	12 Months Ended
Preferred Stock	Dec. 31, 2018
Preferred Stock
Preferred Stock	12. Preferred Stock The Board of Directors or any authorized committee thereof is expressly authorized, to the fullest extent permitted by law, to provide by resolution or resolutions for, out of the unissued shares of Preferred Stock, the issuance of the shares of Preferred Stock in one or more series of such stock, and by filing a certificate of designations pursuant to applicable law of the State of Delaware, to establish or change from time to time the number of shares of each such series, and to fix the designations, powers, including voting powers, full or limited, or no voting powers, preferences and the relative, participating, optional or other special rights of the shares of each series and any qualifications, limitations and restrictions thereof. In connection with the consummation of the IPO, on May 29, 2018 the Company filed an amended and restated certificate of incorporation which authorized for issuance 10,000,000 shares of Preferred Stock, par value $0.001. As of December 31, 2018, no shares of the Preferred Stock were issued or outstanding.

Common Stock

12 Months Ended

Dec. 31, 2018

Common Stock.

Common Stock

13. Common Stock

The voting, dividend and liquidation rights of the holders of common stock are subject to and qualified by the rights, powers and preferences of the holders of Preferred Stock. The common stock has the following characteristics:

Voting

The holders of shares of common stock are entitled to one vote for each share of common stock held at any meeting of stockholders and at the time of any written action in lieu of a meeting.

Dividends

The holders of shares of common stock are entitled to receive dividends, if and when declared by the Company’s Board of Directors. No dividends have been declared or paid by the company to the holders of common stock since the issuance of the common stock.

Liquidation

The holders of common stock are entitled to share ratably in the Company’s net assets available for distribution to its stockholders in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company or upon the occurrence of a deemed liquidation event.

Shares Reserved For Future Issuance

As of December 31, 2018, the Company had reserved common shares as follows:


		As of
		December 31,
		2018
Common shares reserved for exercise of a warrant		7,614
Common shares reserved for future issuance under the 2018 ESPP		235,743
Common shares reserved for exercise of outstanding stock options under the 2018 Plan		1,627,947
Common shares reserved for future issuance under the 2018 Plan		2,534,412
		4,405,716

Equity-Based Compensation

12 Months Ended

Dec. 31, 2018

Equity-Based Compensation

Equity-Based Compensation

14. Equity-Based Compensation

Equity Plans

As of December 31, 2018, the Company has three active equity plans, the 2018 Stock Option and Incentive Plan (the “2018 Plan”), the 2017 Stock Option and Incentive Plan (the “2017 Plan”), and the 2018 Employee Stock Purchase Plan (the “2018 ESPP”).

Prior to the Reorganization, the Company granted incentive units under the 2013 Equity Incentive Plan (the "2013 Plan"), as determined by the Board of Directors. As part of the Reorganization, the Company terminated the 2013 Plan and instituted the 2017 Plan. Pursuant to the Reorganization, all vested and unvested incentive units granted under the 2013 Plan which were outstanding immediately prior to the Reorganization, irrespective of any strike price or voting rights on any such outstanding incentive units, were exchanged for an equal number of shares of common stock or restricted common stock, respectively, under the 2017 Plan. The restricted common stock was issued with the same vesting terms as the unvested incentive units held immediately prior to the Reorganization.

2018 Stock Option and Incentive Plan

The 2018 Plan was adopted by the Company’s Board of Directors on May 2, 2018, and approved by the Company’s stockholders on May 11, 2018. The 2018 Plan has replaced the 2017 Plan as no additional awards will be granted under that plan following the consummation of the IPO. The 2018 Plan allows the Board of Directors’ compensation committee to make equity-based incentive awards to the Company’s officers, employees, directors and other key persons (including consultants).

The Company initially reserved 3,139,274 shares of common stock for the issuance of awards under the 2018 Plan (the “Initial Limit”), which includes 352,204 unused shares reserved for issuance under the 2017 Plan that became available under the 2018 Plan upon the completion of the IPO.

The 2018 Plan provides that the number of shares reserved and available for issuance under the plan will automatically increase each January 1, beginning on January 1, 2019, by 4% of the outstanding number of shares of common stock on the immediately preceding December 31 or such lesser number of shares as determined by the Board of Directors or compensation committee (the “Annual Increase”). These limits are subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization.

The 2018 Plan provides for the grant of incentive stock options, non‑qualified stock options, restricted stock awards, unrestricted stock awards and restricted stock units. The 2018 Plan is administered by the compensation committee of the Board of Directors. The exercise prices, vesting and other restrictions are determined at the discretion of the compensation committee of the Board of Directors, except that the exercise price per share of stock options may not be less than 100% of the fair market value of the share of common stock on the date of grant and the term of stock option may not be greater than ten years. Stock options granted under the 2018 Plan to employees generally vest over four years. The shares of common stock underlying any awards that are forfeited, cancelled, repurchased or are otherwise terminated by the Company under the 2018 Plan will be added back to the shares of common stock available for issuance under the 2018 Plan.

2017 Stock Option and Incentive Plan

The 2017 Plan provides for the grant of incentive stock options, non‑qualified stock options, restricted stock awards, unrestricted stock awards and restricted stock units. The 2017 Plan is administered by the Board of Directors, or at the discretion of the Board of Directors, by a committee of the board comprised of not less than two directors. The exercise prices, vesting and other restrictions are determined at the discretion of the Board of Directors, or their committee if so delegated, except that the exercise price per share of stock options may not be less than 100% of the fair market value of the share of common stock on the date of grant and the term of stock option may not be greater than ten years. Stock options granted under the 2017 Plan to employees generally vest over four years. The number of shares initially reserved for issuance under the 2017 Plan was 3,455,330 shares of common stock. The shares of common stock underlying any awards that are forfeited, cancelled, repurchased or are otherwise terminated by the Company under the 2017 Plan will be added back to the shares of common stock available for issuance under the 2018 Plan. As of December 31, 2018, there were no shares available for future issuance under the 2017 Plan.

2018 Employee Stock Purchase Plan

On May 2, 2018, the Board of Directors adopted the 2018 ESPP, and it was approved by the stockholders on May 11, 2018. The 2018 ESPP initially reserved and authorized the issuance of 235,743 shares of common stock to participating employees. The ESPP provides that the number of shares reserved and available for issuance will automatically increase each January 1, beginning on January 1, 2019, by the lesser of (i) 353,614 shares of common stock, (ii) 1% of the outstanding number of shares of our common stock on the immediately preceding December 31 or (iii) such lesser number of shares as determined by the 2018 ESPP administrator. The number of shares reserved under the 2018 ESPP is subject to adjustment in the event of a stock split, stock dividend or other change in the Company’s capitalization. As of December 31, 2018, no shares have been issued under the 2018 ESPP.

2013 Equity Incentive Plan

The terms of the incentive units granted prior to the Reorganization were determined by the Board of Directors and included vesting, forfeiture, repurchase and other provisions. The Board of Directors also determined whether each incentive unit granted was a voting incentive unit, having the right to vote on any matter the common units had the right to vote on, or a non-voting incentive unit and not carry the right to vote. Incentive units had no rights to dividends and were entitled to distributions. Incentive unit holders were not required to purchase or "exercise" their incentive units in order to receive such distributions. However, distributions to incentive unit holders began only after the cumulative amount distributed to common unit holders exceeded the strike price with respect to such incentive unit. Distributions were entitled to be made to incentive unit holders whether vested or unvested. Unvested distributions were to be held by the Company until the incentive units vested, at which time they would be released to the incentive unit holder. The Board of Directors had the discretion to determine the extent to which an incentive unit would be excluded from participating in distributions. Unless otherwise approved by the Board of Directors, the incentive units generally vested over a four year period with the first 25% vesting following 12 months of employment or service and the remaining incentive units vesting in equal quarterly installments over the following 36 months. The incentive units had no contractual term.

In connection with the issuance of each incentive unit, the Board of Directors set a strike price based on the amount of distributions that the holders of a common unit would be entitled to receive in a hypothetical liquidation of the Company on the date of issuance of the incentive unit in which the Company sold its assets at fair market value, satisfied its liabilities and distributed the net proceeds to the holders of units in liquidation of the Company.

Total Equity‑based Compensation Expense

The Company recorded equity‑based compensation expense related to all equity‑based awards for employees and non‑employees, which was allocated as follows in the consolidated statements of operations and comprehensive loss (in thousands):


	Year Ended
	December 31,
	2018		2017
Research and development expense	$	1,661	$	704
General and administrative expense		3,550		778
	$	5,211	$	1,482

Equity-based compensation during the year ended December 31, 2018 includes $1.2 million, recognized within general and administrative expense, related to modifications of equity awards in connection with the retirement of the Company’s Chief Operating Officer and Head, Corporate Development.

Restricted Stock

The following table summarizes restricted common stock activity as of December 31, 2018:


		Weighted
		Average Fair
		Value per Share
	Number of Shares	at Issuance
Restricted common stock as of December 31, 2017	1,220,085	$	5.77
Granted	—	$	5.77
Vested	(547,786)	$	5.77
Forfeited	(8,125)	$	5.77
Restricted common stock as of December 31, 2018	664,174	$	5.77

As of December 31, 2018, the Company had unrecognized equity-based compensation expense of $2.9 million related to restricted stock issued to employees and directors, which is expected to be recognized over a weighted-average period of 2.0 years.

Stock Options

The following table summarizes the Company’s stock option activity as of December 31, 2018:


				Weighted
		Weighted		Average
	Number of	Average		Remaining	Aggregate
	Shares	Exercise Price		Contractual Term	Intrinsic Value
				(in years)	(in thousands)
Outstanding as of December 31, 2017	—	$	—	—	$	—
Granted	1,652,521		10.81
Exercised	(898)		5.77
Cancelled	(23,676)		7.48
Outstanding as of December 31, 2018	1,627,947		10.86	9.26	$	19,831
Options exercisable as of December 31, 2018	187,028	$	9.37	8.73	$	2,544

Using the Black-Scholes option pricing model, the weighted average fair value of options granted to employees and directors during the year ended December 31, 2018 was $10.81.

The following assumptions were used in determining the fair value of options granted to employees and non-employees:


	Year Ended December 31, 2018
	Employees		Non-Employees
Risk-free interest rate	2.78	%	3.03	%
Expected dividend yield	0.0	%	0.0	%
Expected term (years to liquidity)	6.13		6.64
Expected volatility	81.22	%	77.05	%

As of December 31, 2018, the Company has unrecognized equity-based compensation expense related to its employee stock options of $10.5 million which the Company expects to recognize over the remaining weighted-average vesting period of 3.2 years.

Incentive Units

The Company accounted for the exchange of incentive units in Scholar Rock, LLC for common stock and restricted common stock of Scholar Rock Holding Corporation, as a modification in accordance with the requirements of ASC 718. The Company determined the fair value of the common stock and restricted common stock using the market approach, including the guideline public company method and the precedent transaction method which “backsolves” to a preferred price. Accordingly, the Company determined there was an excess fair value of the replacement awards over the fair value of the incentive units exchanged in connection with the Reorganization. The incremental fair value related to vested awards was recognized immediately as compensation expense. The incremental fair value of unvested awards and any remaining unrecognized compensation of the original awards will be recognized as compensation expense over the remaining vesting period.

A summary of the Company’s incentive unit activity under the 2013 Plan and related information is as follows:


		Weighted		Weighted
		Average Fair		Average Strike
	Number of Units	Value per Unit		Price per Unit
Outstanding at December 31, 2016	1,758,252	$	2.03	$	1.09
Granted	621,497		3.63		2.63
Forfeited	(12,251)		2.86		2.23
Exchanged for common stock and restricted common stock pursuant to the Reorganization	(2,367,498)		2.43		1.49
Outstanding at December 31, 2017	—

In 2017, the fair value of incentive units granted to both employees and non-employees was determined using the market approach, including the guideline public company method and a precedent transaction method which "backsolves" to a preferred price. Equity value was allocated to the common units, incentive units and convertible preferred units using either an option-pricing method ("OPM"), or a hybrid method, which is a hybrid between the OPM and the probability-weighted expected return method. The OPM treats common securities and preferred securities as call options on the total equity value of a company, with exercise prices based on the value thresholds at which the allocation among the various holders of a company’s securities changes. Under this method, the common and incentive units have value only if the funds available for distribution to members exceed the value of the preferred security liquidation preference at the time of the liquidity event, such as a strategic sale or a merger. The hybrid method estimates the probability-weighted value across multiple scenarios but uses the OPM to estimate the allocation of value within at least one of the scenarios. In addition to the OPM, the hybrid method considers an IPO scenario in which preferred shares are assumed to convert to common stock. The future value of the incentive units in the IPO scenario is discounted back to the valuation date at an appropriate risk adjusted discount rate. In the hybrid method, the present value indicated for each scenario is probability weighted to arrive at an indication of value for the common and incentive units.

The following assumptions were used in determining the fair value of incentive units granted to both employees and non-employees during 2017:


	2017
Risk-free interest rate	1.48	%	-	1.97	%
Expected dividend yield	0.0%
Expected term (years to liquidity)	2.63		-	3.23
Expected volatility	71	%	-	77	%

The Company determined the risk‑free rate based on constant maturing U.S. Treasury rates commensurate with the expected term, not seasonally adjusted. The Company has never paid, and does not anticipate paying, any cash dividends in the foreseeable future, and therefore uses an expected dividend yield of zero. Incentive units do not have an explicit contractual term. The Company, therefore, based its assumption on a weighted average of various liquidation scenarios, which would require a distribution to the incentive units. Since the Company was privately held as of the date of these financial statements, it does not have relevant historical data to support its expected volatility. As such, the Company has used a weighted‑average of expected volatility based on the volatilities of a representative group of publicly traded biopharmaceutical companies. For purposes of identifying representative companies, the Company considered characteristics such as stage of development and area of therapeutic focus. Forfeitures of incentive units were accounted for when they occurred.

Income Taxes

12 Months Ended

Dec. 31, 2018

Income Taxes

Income Taxes

15. Income Taxes

The Company has not recorded a current or deferred tax provision for the years ended December 31, 2018 and 2017.

The effective income tax rate differed from the amount computed by applying the federal statutory rate to our loss before income taxes as follows:


	For Year Ended
	December 31,
	2018		2017
Tax effected at statutory rate	21.0	%	34.0	%
State taxes	6.6		8.1
Stock compensation	(1.7)		(2.0)
Non-taxable income	—		0.3
Non deductible expenses	(0.1)		0.1
Impact of federal rate change on net deferred taxes	—		(27.0)
Federal research and development credits	5.9		2.3
Change in valuation allowance	(31.7)		(15.8)
	—	%	—	%

Deferred tax assets (liabilities) consist of the following at December 31, 2018 and 2017 (in thousands):


	As of
	December 31,
	2018		2017
Long-term net deferred tax assets:
Reserve and accruals	$	1,031	$	340
Net operating loss carryforwards		25,380		13,734
Deferred rent		242		190
Deferred revenue		3,525		—
Tax credits		4,976		1,665
Fixed and intangible assets		(498)		(128)
Stock based compensation		314		—
Total long-term net deferred tax assets:		34,970		15,801
Valuation allowance		(34,970)		(15,801)
Total net deferred tax assets	$	—	$	—

Total Net Deferred Tax Assets

Deferred tax assets are reduced by a valuation allowance if, based on the weight of available positive and negative evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Accordingly, a full valuation allowance has been established against the net deferred tax assets as of December 31, 2018 and 2017. The valuation allowance for deferred tax assets increased by $19.2 million and $4.0 million in 2018 and 2017, respectively. This increase mainly relates to the establishment of valuation allowance against the Company’s net domestic deferred tax assets in connection with net operating losses generated in each year and the recording of additional net operating losses and credit carryforwards, partially offset by a revaluation of the federal deferred tax assets in 2017 based on the tax law change discussed below. As of December 31, 2018, the Company had approximately $93.0 million and $92.4 million of Federal and State operating loss carryforwards respectively, which begin to expire in 2034. These loss carryforwards are available to reduce future taxable income, if any. These loss carryforwards are subject to review and possible adjustment by the appropriate taxing authorities. As of December 31, 2018, the Company also had federal and state credit carryovers of $4.0 million and $1.1 million, respectively. The amount of loss and credit carryforwards that may be utilized in any future period may be limited based upon changes in the ownership of the Company’s ultimate parent.

On December 22, 2017, the Tax Cuts and Jobs Act ("TCJA") was signed into law. The TCJA significantly revises the U.S. corporate income tax by, among other things, lowering corporate income tax rate to 21%, implementing a hybrid territorial tax system, and imposing a one-time repatriation tax on foreign cash and earnings. In 2017, the company assessed the impact of this law change on the realization of its deferred tax assets and the remeasurement of the deferred tax assets to the lower statutory federal US tax rate. The remeasurement of the deferred tax assets did not result in a change to the current year income statement or balance sheet, as an offsetting adjustment was also recorded to the valuation allowance maintained on these accounts.

The Company follows the provisions of ASC 740-10, “Accounting for Uncertainty in Income Taxes,” which specifies how tax benefits for uncertain tax positions are to be recognized, measured, and recorded in financial statements; requires certain disclosures of uncertain tax matters; specifies how reserves for uncertain tax positions should be classified on the balance sheet; and provides transition and interim period guidance, among other provisions. As of December 31, 2018 and 2017, the Company has not recorded any amounts for uncertain tax positions. The Company’s policy is to recognize interest and penalties accrued on any uncertain tax positions as a component of income tax expense, if any, in its statements of income. As of December 31, 2018 and 2017, the Company had no reserves for uncertain tax positions. For the years ended December 31, 2018 and 2017, no estimated interest or penalties were recognized on uncertain tax positions.

Commitments and Contingencies

12 Months Ended

Dec. 31, 2018

Commitments and Contingencies

Commitments and Contingencies

16. Commitments and Contingencies

Operating Leases

Facility Lease

In March 2015, the Company entered into a 5‑year facility lease for its corporate headquarters (the “lease”). The lease was amended in February 2018, to add an additional space (the “expansion space”) at the current location and to extend the lease term (the “amended lease”). The amended lease expires in July 2023. Rent for the facility lease, including the expansion space, increases from $1.4 million a year to $1.7 million a year over the term of the lease. The Company has the option to extend the term of the amended lease for one additional term of 5 years commencing after the amended lease expires.

The Company recognizes rent expense and records a deferred rent obligation representing the cumulative difference between actual rent payments and rent expense recognized ratably over the lease period, which is included in the Company’s consolidated balance sheets as of December 31, 2018 and 2017.

Minimum annual rent payments under this lease for the remaining term of the amended lease, excluding operating expenses and taxes which are not fixed for future periods as of December 31, 2018, are as follows (in thousands):



	Total Minimum
Year ending December 31,	Lease Payments
2019	$	1,382
2020		1,447
2021		1,623
2022		1,672
2023		1,137
Thereafter		—
Total minimum lease payments	$	7,261

The Company recorded approximately $1.0 million and $0.5 million in rent expense for the years ended December 31, 2018 and 2017, respectively.

Legal Proceedings

The Company is not currently a party to any material legal proceedings.

Loan Payable

12 Months Ended

Dec. 31, 2018

Loan Payable

Loan Payable

17. Loan Payable

In August 2015, the Company entered into a Loan and Security Agreement with Silicon Valley Bank (“SVB”), which provided the Company an equipment line of credit of up to $2.0 million to finance the purchase of eligible equipment. Pursuant to the agreement, SVB was obligated to make up to five equipment advances, each in an amount of at least $0.1 million during the draw period which began on the effective date, August 11, 2015, and ended on June 30, 2016.

In August 2016, the Company entered into the First Amendment to the Loan and Security Agreement (“First Amendment”), which provided the Company an extension of the draw period to December 31, 2016. Through December 31, 2016, the Company borrowed $2.0 million against the line of credit, which fulfilled the maximum credit line. The loan balance at December 31, 2018 and December 31, 2017 was $0.4 million and $1.0 million, respectively.

In addition, the First Amendment expanded the operating accounts provision to require the Company to, at all times, have on deposit in operating, depository and securities accounts maintained with SVB or SVB’s affiliates, unrestricted and unencumbered cash in an amount equal to the lesser of (a) 105% of the then outstanding obligations or (b) 100% of the dollar value of the Company’s accounts at all financial institutions. The Company was in compliance with this covenant at December 31, 2018 and December 31, 2017, which required the Company to hold a minimum of $0.4 million and $1.1 million in accounts with SVB, respectively.

Amounts borrowed bear interest at an annual prime rate as published in the Wall Street Journal less 0.25%, which, at December 31, 2018 and 2017 was 4.25% and 5.25%, respectively. For each advance, interest‑only payments were due and paid through June 2016. Principal and interest payments commenced on July 1, 2016 for a period of 36 months. A final payment fee equal to 4% of the aggregate advances is also due on June 1, 2019. The final payment is being accrued over the term of the loan and is being recorded as interest expense.

Future principal payments on this loan as of December 31, 2018 are as follows (in thousands):


Year ending December 31,	Total Future Principal Payments
2019	$	365
	$	365

The Company incurred costs on behalf of the lender recorded as a debt discount of $0.1 million and incurred issuance costs recorded as deferred financing costs of $19,000, both of which are recorded as a deduction from the carrying amount of the loan and are being amortized as interest expense over the term of the loan.

The Company has granted SVB a security interest in the equipment financed under the agreement. The Loan and Security Agreement contains negative covenants restricting the Company’s activities, including limitations on dispositions, change in business ownership or location, mergers or acquisitions, incurring indebtedness or liens, paying dividends or making investments and certain other business transactions.

The Company has the option to prepay the loan and upon prepayment will pay the outstanding principal and interest, the final payment fee and the prepayment premium. The prepayment premium is equal to 0.5% of the principal balance. The Company evaluated the prepayment option (“Call Option”) to determine if the features should be separated from the loan and recognized as a derivative under ASC Topic 815, Derivatives and Hedging, (“ASC 815”), concluding that the Call Option is clearly and closely related to the Loan and does not meet the criteria for bifurcation from the loan.

The Company is in compliance with its covenants. However, in the event of a default, and during such an event, the interest rate will increase by 5% per year.

The Company recorded total interest expense for this loan of $0.1 million, for both the years ended December 31, 2018 and 2017.

Agreements	12 Months Ended
Agreements	Dec. 31, 2018
Agreements
Agreements	18. Agreements Collaboration with Gilead Agreement Summary On December 19, 2018 (“Effective Date”), the Company entered into a Master Collaboration Agreement (the “Gilead Collaboration Agreement”) with Gilead Sciences, Inc. (“Gilead”) to discover and develop specific discover and develop specific inhibitors of TGFβ activation focused on the treatment of fibrotic diseases. Under the collaboration, Gilead has exclusive options to license worldwide rights to product candidates that emerge from three of our TGFβ programs. Pursuant to the Gilead Collaboration Agreement, we are responsible for antibody discovery and preclinical research through product candidate nomination, after which, upon exercising the option for a program, Gilead will be responsible for the program’s preclinical and clinical development and commercialization. Such option may be exercised by Gilead at any time from the Effective Date through a date that is 90 days following the expiration of the Research Collaboration Term (as defined below) for a given program, or until termination of the program, whichever is earlier (the “Option Exercise Period”). The Company received a non-refundable upfront payment of $50 million under the Gilead Collaboration Agreement. If Gilead exercises its option to exclusively license a Gilead Program, the Company may earn a total potential aggregate option exercise fee, development, regulatory and commercial milestone payments with respect to each Program of $475 million, or a total of $1,425 million across all three Programs. Additionally, in partial consideration of the rights granted to Gilead pursuant to the License Agreement, Gilead shall pay to the Company certain tiered royalties at a rate ranging from the high single-digits to the low double-digits (depending on the amount of net sales) on each Licensed Product in a given calendar year, on a country-by-country basis. Gilead will pay the Company a one-time milestone payment in the amount of $25 million following achievement of successful demonstration of in vivo proof of concept consistent with certain criteria detailed in the Gilead Collaboration Agreement. None of the payments under the Gilead Collaboration Agreement are refundable. Simultaneously with the entry into the Gilead Collaboration Agreement, the Company entered into a Share Purchase Agreement with Gilead (the “Gilead Equity Agreement”). Pursuant to the terms of the Gilead Equity Agreement, Gilead purchased 980,392 shares of common stock of the Company (the “Shares”) at a purchase price of $30.60 per share, for an aggregate purchase price of $30 million. The Company did not incur any material costs in connection with the issuance of the Shares. The Company and Gilead have established a joint steering committee (the “JSC”). The JSC will, among other powers and responsibilities, review, oversee and have decision-making responsibilities for certain activities performed under the Programs, including reviewing and amending the research plans, reviewing any development candidate nominations, selecting a development candidate, and overseeing the strategic direction of the programs. The Company will conduct its activities for each program under the Gilead Collaboration Agreement, on a program-by-program basis, during the period beginning on the Effective Date and ending on the earliest to occur of (a) the date that the JSC first approves a selected development candidate for such program, (b) the third anniversary of the Effective Date, or (c) the effective date of termination of the Gilead Collaboration Agreement (the “Research Collaboration Term”). During the Research Collaboration Term, for each program, the Company will notify Gilead, through the JSC, of up to two program antibodies (in the case that Gilead rejects one, in accordance with the terms of the Gilead Collaboration Agreement) that satisfy the development criteria for such program (the “Development Candidate Nomination”). This Gilead Collaboration Agreement will remain in effect, unless otherwise earlier terminated in accordance with the terms of the Gilead Collaboration Agreement, on a program-by-program basis, until Gilead exercises its Option with respect to a given program or until expiration of the applicable Option Exercise Period, whichever is earlier (the “Term”). Unless earlier terminated, the Term shall expire in its entirety upon the expiration of the last to expire Option Exercise Period under the Gilead Collaboration Agreement. Gilead may terminate the Gilead Collaboration Agreement in its entirety or on a program-by-program basis in its sole discretion upon prior written notice to the Company pursuant to the terms of the agreement. The Gilead Collaboration Agreement may also be terminated on a program-by-program basis by either party in the event of an uncured material breach of the Gilead Collaboration Agreement by the other party. Prior to Gilead’s exercise of an option, the Company will have the lead responsibility for drug discovery and pre-clinical development of all programs through to Development Candidate Nomination. Within a certain period of time after receiving a data package for a Development Candidate Nomination, Gilead may exercise its option to enter into a Form of License Agreement for exclusive rights to develop, manufacture and commercialize the licensed antibodies and licensed products of such Gilead Program. Accounting Treatment The Company assessed this arrangement in accordance with ASC 606 and concluded that the contract counterparty, Gilead, is a customer. The Company identified the following material promises under the arrangement: (1) the non-exclusive, royalty-free research and development license; (2) the research and development services for the Gilead Programs; and (3) the options to license each of the three programs to develop, manufacture and commercialize licensed candidates and resulting products. The research and development services for each of the three Gilead Programs were determined to not be distinct from the research and development license and have been combined into a single performance obligation for each program. The promises under the Gilead Collaboration Agreement relate primarily to the research and development required by the Company for each of the programs nominated by Gilead. The Company does not have significant responsibilities subsequent to Gilead’s exercise of each option. At the commencement of the arrangement, two units of accounting were identified: the issuance of 980,392 of the Company’s common shares and the joint research activities during the three-year research collaboration term. The Company determined the total transaction price to be $80 million, consisting of $17.1 million attributed to the equity sold to Gilead and $62.9 million attributed to the joint research activities. In determining the fair value of the common stock at closing, the Company considered the closing price of the common stock at the time of the transaction and included a lack of marketability discount because the shares were subject to certain restrictions. Of the $30 million equity investment, $12.9 million was determined to be a premium and therefore was included as part of the transaction price to be allocated over the performance obligations. The potential incremental payment of $25 million is due following achievement of successful demonstration of in vivo proof of concept consistent with certain criteria detailed in the Gilead Collaboration Agreement and will be included in the transaction price when it becomes probable that a future material reversal will not occur. The Company will reevaluate the transaction price at the end of each reporting period and as uncertain events are resolved or other changes in circumstances occur, and, if necessary, will adjust its estimate of the transaction price. The transaction price was allocated to the performance obligations based on their standalone selling prices when the Gilead Collaboration Agreement was executed. The consideration related to the underlying options will not be included in the transaction price until the options are exercised. Additionally, the subsequent potential development, regulatory and commercial milestones are excluded from the transaction price, until after Gilead exercises its respective options. Revenue associated with the research and development and license performance obligations relating to the Gilead Programs is recognized as revenue as the research and development services are provided using an input method, according to the costs incurred on each program and the costs expected to be incurred in the future to satisfy the performance obligation. The transfer of control occurs over time. In management’s judgment, this input method is the best measure of progress towards satisfying the performance obligation. The amounts received that have not yet been recognized as revenue are recorded in deferred revenue on the Company’s consolidated balance sheet. None of the performance obligations have been fully satisfied as of December 31, 2018. During the year ended December 31, 2018, the Company recognized no revenue in the Company’s consolidated statements of operations and comprehensive loss under the Gilead Collaboration Agreement. The aggregate amount of the transaction price allocated to the Company’s unsatisfied performance obligations and recorded in deferred revenue at December 31, 2018 is $62.9 million. The Company expects to recognize the deferred revenue according to costs incurred, over the remaining research term for each respective program, which is up to three years as of December 2018; each research term is dependent on the timing of Gilead either exercising its options for the programs or terminating further development on the programs prior to the expiration date of the research term. Janssen Agreement Overview On December 17, 2013, the Company entered into an option and license agreement with Janssen. All performance obligations under this agreement were completed in 2016. Janssen holds a license to one pharmaceutical profile, which obligates Janssen to pay the Company certain development milestones totaling up to $25.0 million and regulatory milestones totaling up to $97.0 million for each pharmacological profile as detailed in the agreement during the development period and through successful regulatory approval. Development milestones are triggered upon the achievement of specified development criteria or dosing of a specified number of patients in phases of clinical trials. Regulatory milestones are triggered upon approval to market a product candidate by the United States Food and Drug Administration (“FDA”) or other global regulatory authorities. Additionally, commercial milestone payments totaling up to $130.0 million for the pharmacological profile are eligible to be earned as certain sales thresholds are achieved by Janssen and royalties are also required to be paid by Janssen to the Company based on annual net sales thresholds, based on Janssen’s sales of a product derived from the collaboration molecule(s). The next potential milestone the Company may be entitled to receive under the agreement is a milestone payment of $2.0 million upon achievement of a development milestone. This milestone is variable consideration and is currently fully constrained. There were no contract assets or contract liabilities for any period presented.

Net Loss per Share

12 Months Ended

Dec. 31, 2018

Net Loss per Share

Net Loss per Share

19. Net Loss per Share

Following the Reorganization, the Company calculates basic net loss per share by dividing net loss by the weighted average number of common shares outstanding, excluding restricted common stock. For the years ended December 31, 2018 and 2017, the weighted average number of common shares outstanding includes the weighted average number of common units outstanding prior to the Reorganization. The Company has generated a net loss in all periods presented, so the basic and diluted net loss per share are the same, as the inclusion of the potentially dilutive securities would be anti-dilutive.

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


	Year Ended		Year Ended
	December 31, 2018		December 31, 2017
Net loss	$	(49,326)	$	(24,995)
Weighted average common shares outstanding, basic and diluted		15,655,293		1,634,100
Net loss per share, basic and diluted	$	(3.15)	$	(15.30)

The following table sets forth the outstanding common stock equivalents, presented based on amounts outstanding at each period end, that have been excluded from the calculation of diluted net loss per unit or share for the periods indicated because their inclusion would have been anti‑dilutive:


	Year Ended December 31,
	2018	2017
Convertible preferred stock	—	15,109,950
Restricted common stock	664,174	1,220,085
Warrant	7,614	7,614
Stock options	1,627,947	—
	2,299,735	16,337,649

Retirement Plan	12 Months Ended
Retirement Plan	Dec. 31, 2018
Retirement Plan
Retirement Plan	20. Retirement Plan The Company sponsors a 401(K) retirement plan, in which substantially all employees are eligible to participate upon employment. Participants may contribute a percentage of their annual compensation to this plan, subject to statutory limitations. The Company did not provide any contributions to this plan during the years ended December 31, 2018 and 2017.

Related Party Transactions	12 Months Ended
Related Party Transactions	Dec. 31, 2018
Related Party Transactions
Related Party Transactions	21. Related Party Transactions Licensing Agreement Pursuant to a license agreement with Children’s Medical Center Corporation (“CMCC”), a common share holder, the Company has an obligation to pay CMCC an annual license maintenance fee of $10,000 for each year until the agreement is terminated. The Company will also be responsible for up to $1.3 million of development milestone payments through the first regulatory approval of a licensed product, tiered royalty payments of low single‑digit percentages on net sales of licensed product in the event that the Company realizes sales from products covered by the license agreement, which are products that the Company develops using its proprietary platform, and between 10% to 20% of non‑royalty income attributable to a sublicense of the CMCC rights. During the year ended December 31, 2018, the Company paid a milestone of $0.1 million associated with the agreement. The Company recorded research and development expense in the statements of operations of $0.8 million and $10,000 for the years ended December 31, 2018 and 2017, respectively. The Company had $0.7 million and $10,000 due as of December 31, 2018 and 2017, respectively. Consulting Agreements The Company entered into consulting agreements on October 10, 2012 with its two scientific co‑founders to provide services related to the advancement of the research and development platform of the company. The consulting arrangements are on a fixed‑fee basis, paid quarterly. The initial contract terms were four years and terminated on October 10, 2016. The contracts were extended for an additional four-year period. The Company incurred $0.2 million of consulting expense related to these contracts, in each year, for the years ended December 31, 2018 and 2017. There are no amounts due at December 31, 2018 or December 31, 2017.

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2018

Summary of Significant Accounting Policies

Use of Estimates

Concentration of Credit Risk and Off-Balance Sheet Risk

Cash and Cash Equivalents and Restricted Cash


	As of December 31,
	2018		2017
Cash and cash equivalents	$	115,069	$	56,461
Restricted cash		205		205
	$	115,274	$	56,666

Property and Equipment


		Estimated Useful Life
		(in Years)
Laboratory equipment		3 - 5
Machinery and equipment		3 - 5
Furniture and fixtures		5
Leasehold improvements		Shorter of the useful life or remaining lease term

Impairment of Long-Lived Assets

Fair Value Measurements

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

Level 2 — Inputs other than Level 1 inputs that are either directly or indirectly observable, such as quoted market prices, interest rates and yield curves.

Level 3 — Unobservable inputs developed using estimates of assumptions developed by the Company, which reflect those that a market participant would use.

Segment Information

Revenue Recognition

For a complete discussion of accounting for collaboration revenues, see Note 18, Agreements.

Research and Development Expenses and Accruals

Equity-Based Compensation

Pursuant to ASU 2016‑09, Improvements to Employee Share-Based Payment Accounting, the Company elected to account for forfeitures when they occur.

Convertible Preferred Units and Convertible Preferred Stock

Comprehensive Loss

Net Loss per Unit and Share

Net Loss per Share

Income Taxes

Marketable Securities

Deferred Offering Costs

Recently Adopted Accounting Pronouncements

Recently Issued Accounting Pronouncements

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2018

Summary of Significant Accounting Policies

Schedule of reconciles of cash and cash equivalents and restricted cash

The following table reconciles cash and cash equivalents and restricted cash per the balance sheet to the statement of cash flows:


	As of December 31,
	2018		2017
Cash and cash equivalents	$	115,069	$	56,461
Restricted cash		205		205
	$	115,274	$	56,666

Schedule of useful life of property, plant and equipment


		Estimated Useful Life
		(in Years)
Laboratory equipment		3 - 5
Machinery and equipment		3 - 5
Furniture and fixtures		5
Leasehold improvements		Shorter of the useful life or remaining lease term

Fair Value of Financial Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2018

Fair Value of Financial Assets and Liabilities

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

The following tables summarize the assets and liabilities measured at fair value on a recurring basis at December 31, 2018 and 2017 (in thousands):


	Fair Value Measurements at December 31, 2018
	Total		Level 1		Level 2		Level 3
Assets:
Money market funds, included in cash and cash equivalents	$	114,593	$	114,593	$	—	$	—
Marketable securities:
U.S. Treasury obligations		60,576		60,576		—		—
Total assets	$	175,169	$	175,169	$	—	$	—


	Fair Value Measurements at December 31, 2017
	Total		Level 1		Level 2		Level 3
Assets:
Money market funds, included in cash and cash equivalents	$	55,291	$	55,291	$	—	$	—
Marketable securities:
U.S. Treasury obligations		1,498		1,498		—		—
Total assets	$	56,789	$	56,789	$	—	$	—
Liabilities:
Warrant to purchase redeemable security	$	37	$	—	$	—	$	37
Total liabilities	$	37	$	—	$	—	$	37

Marketable Securities (Tables)

12 Months Ended

Dec. 31, 2018

Marketable Securities

Summary of investments

The following table summarizes the Company’s investments as of December 31, 2018 (in thousands):


			Gross
	Amortized		Unrealized				Estimated
	Cost		Gains		Losses		Fair Value
Marketable securities available-for-sale:
U.S. Treasury obligations	$	60,584	$	—	$	(8)	$	60,576
Total available-for-sale securities	$	60,584	$	—	$	(8)	$	60,576

The following table summarizes the Company’s investments as of December 31, 2017 (in thousands):


			Gross
	Amortized		Unrealized				Estimated
	Cost		Gains		Losses		Fair Value
Marketable securities available-for-sale:
U.S. Treasury obligations	$	1,500	$	—	$	(2)	$	1,498
Total available-for-sale securities	$	1,500	$	—	$	(2)	$	1,498

Property and Equipment, Net (Tables)

12 Months Ended

Dec. 31, 2018

Property and Equipment, Net

Summary of property and equipment

At December 31, 2018 and 2017, property and equipment consists of the following (in thousands):


	As of December 31,
	2018		2017
Laboratory equipment	$	3,585	$	2,074
Furniture & fixtures		219		151
Machinery & equipment		75		7
Leasehold improvements		1,578		1,498
Construction in progress		89		—
		5,546		3,730
Less: Accumulated depreciation and amortization		(2,356)		(1,549)
	$	3,190	$	2,181

Accrued Expenses (Tables)

12 Months Ended

Dec. 31, 2018

Accrued Expenses

Summary of accrued expenses

At December 31, 2018 and 2017, accrued expenses consist of the following (in thousands):


	As of December 31,
	2018		2017
Accrued payroll and related expenses	$	2,826	$	1,174
Accrued external research and development expense		3,284		1,225
Accrued professional and consulting expense		890		382
Accrued other		157		15
	$	7,157	$	2,796

Common Stock (Tables)

12 Months Ended

Dec. 31, 2018

Common Stock.

Schedule of reserved common stock


		As of
		December 31,
		2018
Common shares reserved for exercise of a warrant		7,614
Common shares reserved for future issuance under the 2018 ESPP		235,743
Common shares reserved for exercise of outstanding stock options under the 2018 Plan		1,627,947
Common shares reserved for future issuance under the 2018 Plan		2,534,412
		4,405,716

Equity-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2018

Equity-Based Compensation

Summary of allocation of equity-based compensation


	Year Ended
	December 31,
	2018		2017
Research and development expense	$	1,661	$	704
General and administrative expense		3,550		778
	$	5,211	$	1,482

Summary of restricted common stock activity


		Weighted
		Average Fair
		Value per Share
	Number of Shares	at Issuance
Restricted common stock as of December 31, 2017	1,220,085	$	5.77
Granted	—	$	5.77
Vested	(547,786)	$	5.77
Forfeited	(8,125)	$	5.77
Restricted common stock as of December 31, 2018	664,174	$	5.77

Summary of stock option activity


				Weighted
		Weighted		Average
	Number of	Average		Remaining	Aggregate
	Shares	Exercise Price		Contractual Term	Intrinsic Value
				(in years)	(in thousands)
Outstanding as of December 31, 2017	—	$	—	—	$	—
Granted	1,652,521		10.81
Exercised	(898)		5.77
Cancelled	(23,676)		7.48
Outstanding as of December 31, 2018	1,627,947		10.86	9.26	$	19,831
Options exercisable as of December 31, 2018	187,028	$	9.37	8.73	$	2,544

Schedule of fair value assumptions


	Year Ended December 31, 2018
	Employees		Non-Employees
Risk-free interest rate	2.78	%	3.03	%
Expected dividend yield	0.0	%	0.0	%
Expected term (years to liquidity)	6.13		6.64
Expected volatility	81.22	%	77.05	%

Summary of award activity


		Weighted		Weighted
		Average Fair		Average Strike
	Number of Units	Value per Unit		Price per Unit
Outstanding at December 31, 2016	1,758,252	$	2.03	$	1.09
Granted	621,497		3.63		2.63
Forfeited	(12,251)		2.86		2.23
Exchanged for common stock and restricted common stock pursuant to the Reorganization	(2,367,498)		2.43		1.49
Outstanding at December 31, 2017	—

Summary of non-option fair value assumptions


	2017
Risk-free interest rate	1.48	%	-	1.97	%
Expected dividend yield	0.0%
Expected term (years to liquidity)	2.63		-	3.23
Expected volatility	71	%	-	77	%

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Taxes

Schedule of reconciliation of effective income tax rate differed from the amount computed by applying the federal statutory rate


	For Year Ended
	December 31,
	2018		2017
Tax effected at statutory rate	21.0	%	34.0	%
State taxes	6.6		8.1
Stock compensation	(1.7)		(2.0)
Non-taxable income	—		0.3
Non deductible expenses	(0.1)		0.1
Impact of federal rate change on net deferred taxes	—		(27.0)
Federal research and development credits	5.9		2.3
Change in valuation allowance	(31.7)		(15.8)
	—	%	—	%

Summary of deferred tax assets (liabilities)

Deferred tax assets (liabilities) consist of the following at December 31, 2018 and 2017 (in thousands):


	As of
	December 31,
	2018		2017
Long-term net deferred tax assets:
Reserve and accruals	$	1,031	$	340
Net operating loss carryforwards		25,380		13,734
Deferred rent		242		190
Deferred revenue		3,525		—
Tax credits		4,976		1,665
Fixed and intangible assets		(498)		(128)
Stock based compensation		314		—
Total long-term net deferred tax assets:		34,970		15,801
Valuation allowance		(34,970)		(15,801)
Total net deferred tax assets	$	—	$	—

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2018

Commitments and Contingencies

Summary of the future minimum lease payments due



	Total Minimum
Year ending December 31,	Lease Payments
2019	$	1,382
2020		1,447
2021		1,623
2022		1,672
2023		1,137
Thereafter		—
Total minimum lease payments	$	7,261

Loan Payable (Tables)

12 Months Ended

Dec. 31, 2018

Loan Payable

Schedule of future principal payments of loan

Future principal payments on this loan as of December 31, 2018 are as follows (in thousands):


Year ending December 31,	Total Future Principal Payments
2019	$	365
	$	365

Net Loss per Share (Tables)

12 Months Ended

Dec. 31, 2018

Net Loss per Share

Schedule of basic and diluted net loss per share

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


	Year Ended		Year Ended
	December 31, 2018		December 31, 2017
Net loss	$	(49,326)	$	(24,995)
Weighted average common shares outstanding, basic and diluted		15,655,293		1,634,100
Net loss per share, basic and diluted	$	(3.15)	$	(15.30)

Summary of anti-dilutive securities


	Year Ended December 31,
	2018	2017
Convertible preferred stock	—	15,109,950
Restricted common stock	664,174	1,220,085
Warrant	7,614	7,614
Stock options	1,627,947	—
	2,299,735	16,337,649

Nature of the Business and Basis of Presentation (Details) $ / shares in Units, $ in Thousands		3 Months Ended	12 Months Ended
	May 11, 2018	Jun. 30, 2018 USD ($) $ / shares shares	Dec. 31, 2018 USD ($) item shares
Nature of the Business and Basis of Presentation
Number of collaborations \| item			2
Revenue \| $			$ 0
Sale of common shares (in shares)		6,164,000
Sales price (in dollars per share) \| $ / shares		$ 14.00
Shares sold \| $		$ 77,800	$ 17,096
Convertible preferred stock converted into shares		15,109,950
Shares that warrant can purchase		7,614	7,614
Reverse stock split ratio	2.8548

Summary of Significant Accounting Policies - Concentration of Credit Risk and Off-Balance Sheet Risk (Details) $ in Billions	Dec. 31, 2018 USD ($)
Concentration of Credit Risk and Off-Balance Sheet Risk
Off-balance sheet risk	$ 0
Minimum
Concentration of Credit Risk and Off-Balance Sheet Risk
Assets under management	$ 10

Summary of Significant Accounting Policies - Cash and Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Cash and cash equivalents and restricted cash
Letter of credit	$ 200
Cash and cash equivalents	115,069	$ 56,461
Restricted cash	205	205
Total	$ 115,274	$ 56,666	$ 10,238

Summary of Significant Accounting Policies - Property and Equipment (Details)	12 Months Ended
	Dec. 31, 2018
Laboratory equipment \| Minimum
Property and Equipment, Net
Estimated Useful Life	3 years
Laboratory equipment \| Maximum
Property and Equipment, Net
Estimated Useful Life	5 years
Machinery & equipment \| Minimum
Property and Equipment, Net
Estimated Useful Life	3 years
Machinery & equipment \| Maximum
Property and Equipment, Net
Estimated Useful Life	5 years
Furniture & fixtures
Property and Equipment, Net
Estimated Useful Life	5 years

Summary of Significant Accounting Policies - Misc (Details)	12 Months Ended
	Dec. 31, 2018 USD ($) segment	Dec. 31, 2017 USD ($)
Summary of Significant Accounting Policies
Number of operating segments \| segment	1
Realized gains or losses on sales of marketable securities	$ 0	$ 0
Adjustment for other than temporary decline in fair value	$ 0	$ 0

Fair Value of Financial Assets and Liabilities - (Details) - USD ($) $ / shares in Units, $ in Thousands	Dec. 31, 2018	Jun. 30, 2018	Dec. 31, 2017
Liabilities:
Shares that warrant can purchase	7,614	7,614
Warrant purchase price	$ 3.94
Recurring
Assets:
Money market funds, included in cash and cash equivalents	$ 114,593		$ 55,291
Marketable securities:
U.S. Treasury obligations	60,576		1,498
Total assets	175,169		56,789
Liabilities:
Warrant to purchase redeemable security			37
Total liabilities			37
Recurring \| Level 1
Assets:
Money market funds, included in cash and cash equivalents	114,593		55,291
Marketable securities:
U.S. Treasury obligations	60,576		1,498
Total assets	$ 175,169		56,789
Recurring \| Level 3
Liabilities:
Warrant to purchase redeemable security			37
Total liabilities			$ 37

Marketable Securities - Summary of Investments (Details) $ in Thousands	Dec. 31, 2018 USD ($) security	Dec. 31, 2017 USD ($) security
Marketable securities available-for-sale
Amortization Cost	$ 60,584	$ 1,500
Gross Unrealized Losses	(8)	(2)
Estimated Fair Value	60,576	1,498
Aggregate fair value of marketable securities with unrealized losses position for less than a year	$ 60,600	$ 1,500
Number of investments in an unrealized loss position for less than a year \| security	16	1
U.S. Treasury obligations
Marketable securities available-for-sale
Amortization Cost	$ 60,584	$ 1,500
Gross Unrealized Losses	(8)	(2)
Estimated Fair Value	$ 60,576	$ 1,498

Property and Equipment, Net (Details) - USD ($)	12 Months Ended
Property and Equipment, Net (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Property and Equipment, Net
Property and equipment, gross	$ 5,546,000	$ 3,730,000
Less: Accumulated depreciation and amortization	(2,356,000)	(1,549,000)
Total property and equipment, net	3,190,000	2,181,000
Depreciation and amortization expense	807,000	669,000
Capital lease cost basis	44,000	0
Laboratory equipment
Property and Equipment, Net
Property and equipment, gross	3,585,000	2,074,000
Furniture & fixtures
Property and Equipment, Net
Property and equipment, gross	219,000	151,000
Machinery & equipment
Property and Equipment, Net
Property and equipment, gross	75,000	7,000
Leasehold improvements
Property and Equipment, Net
Property and equipment, gross	1,578,000	$ 1,498,000
Construction in progress
Property and Equipment, Net
Property and equipment, gross	$ 89,000

Accrued Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Accrued Expenses
Accrued payroll and related expenses	$ 2,826	$ 1,174
Accrued external research and development expense	3,284	1,225
Accrued professional and consulting expense	890	382
Accrued other	157	15
Accrued expenses	$ 7,157	$ 2,796

Member Units (Details)	Dec. 31, 2018 class
Member Units
Number of classes of units	2

Common Units (Details) $ in Thousands	12 Months Ended
Common Units (Details) $ in Thousands	Dec. 31, 2017 USD ($) Vote shares
Common Units
Common units outstanding (in units) \| shares	0
Number of vote per unit \| Vote	1
Common unit dividend declared \| $	$ 0

Convertible Preferred Units (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	May 31, 2017	Dec. 31, 2017
Convertible preferred equity
Net proceeds		$ 4,285
Convertible preferred units
Convertible preferred equity
Issuance of convertible preferred share (in shares)		1,428,209
Series B convertible preferred units
Convertible preferred equity
Issuance of convertible preferred share (in shares)	1,428,209
Net proceeds	$ 4,300

Reorganization and Convertible Preferred Stock (Details) - $ / shares	1 Months Ended	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2018	Jun. 30, 2018
Reorganization and Convertible Preferred Stock
Convertible preferred stock, shares issued	43,135,911	0
Warrant to purchase		7,614	7,614
Warrant purchase price		$ 3.94
Incentive units
Reorganization and Convertible Preferred Stock
Number of shares received for each outstanding unit	1
Effect of Reorganization issuance (in shares)	2,367,498
Common Stock
Reorganization and Convertible Preferred Stock
Number of shares received for each outstanding unit	1
Effect of Reorganization issuance (in shares)	1,603,088	15,109,950
Series B convertible preferred stock
Reorganization and Convertible Preferred Stock
Number of shares received for each outstanding unit	1
Convertible preferred stock, shares issued	13,526,994
Series A-4 convertible preferred stock
Reorganization and Convertible Preferred Stock
Number of shares received for each outstanding unit	1
Convertible preferred stock, shares issued	3,906,738
Series A-3 convertible preferred stock
Reorganization and Convertible Preferred Stock
Number of shares received for each outstanding unit	1
Convertible preferred stock, shares issued	5,579,709
Effect of Reorganization issuance (in shares)	21,739
Series A-2 convertible preferred stock
Reorganization and Convertible Preferred Stock
Number of shares received for each outstanding unit	1
Convertible preferred stock, shares issued	5,066,915
Series A-1 convertible preferred stock
Reorganization and Convertible Preferred Stock
Number of shares received for each outstanding unit	1
Convertible preferred stock, shares issued	2,000,000
Series A-3 convertible preferred units
Reorganization and Convertible Preferred Stock
Warrant to purchase	21,739
Warrant purchase price	$ 1.38

Convertible Preferred Stock (Details) - USD ($) $ in Thousands		12 Months Ended
	Dec. 22, 2017	Dec. 31, 2017	Dec. 31, 2018
Convertible preferred equity
Net proceeds from convertible preferred stock		$ 46,890
Preferred shares issued (in shares)		43,135,911	0
Convertible preferred stock
Convertible preferred equity
Preferred shares issued (in shares)		43,135,911
Series C convertible preferred stock
Convertible preferred equity
Net proceeds from convertible preferred stock	$ 46,900
Preferred shares issued (in shares)	13,055,555
Stock issuance cost	$ 100	$ 109

Preferred Stock (Details) - $ / shares	Dec. 31, 2018	May 29, 2018	Dec. 31, 2017
Preferred Stock
Preferred stock, shares authorized	10,000,000	10,000,000	0
Preferred stock, par value	$ 0.001	$ 0.001	$ 0.001
Preferred stock, shares issued	0		0
Preferred stock, shares outstanding	0		0

Common Stock (Details)	12 Months Ended
Common Stock (Details)	Dec. 31, 2018 USD ($) shares
Class of Stock [Line Items]
Number of votes per share	1
Dividend declared or paid \| $	$ 0
Shares reserved for future issuance	4,405,716
2018 ESPP
Class of Stock [Line Items]
Shares reserved for future issuance	235,743
2018 Plan
Class of Stock [Line Items]
Shares reserved for future issuance	2,534,412
Stock options
Class of Stock [Line Items]
Shares reserved for future issuance	1,627,947
Warrant
Class of Stock [Line Items]
Shares reserved for future issuance	7,614

Equity-Based Compensation - 2018 Plan (Details)		12 Months Ended
Equity-Based Compensation - 2018 Plan (Details)	May 11, 2018 shares	Dec. 31, 2018 item	Dec. 31, 2017 shares
Share-based Compensation Arrangement by Share-based Payment Award
Number of share-based compensation plans \| item		3
2018 Plan
Share-based Compensation Arrangement by Share-based Payment Award
Additional shares authorized under stock-based plans (in shares)	352,204
Shares authorized for issuance	3,139,274
Increase as percentage of outstanding shares	4.00%
Fair market value of the share of common stock (as a percent)	100.00%
Term of stock option	10 years
Vesting period	4 years
2017 Plan
Share-based Compensation Arrangement by Share-based Payment Award
Additional shares authorized under stock-based plans (in shares)	0
Shares authorized for issuance			3,455,330
Fair market value of the share of common stock (as a percent)			100.00%
Term of stock option			10 years
Vesting period			4 years

Equity-Based Compensation - 2017 Plan (Details)	12 Months Ended
Equity-Based Compensation - 2017 Plan (Details)	Dec. 31, 2017 director shares	Dec. 31, 2018 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for future issuance		4,405,716
2017 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of directors \| director	2
Fair market value of the share of common stock (as a percent)	100.00%
Term of stock option	10 years
Vesting period	4 years
Shares authorized for issuance	3,455,330
Shares available for future issuance		0

Equity-Based Compensation - 2018 ESPP (Details) - shares		12 Months Ended
	May 02, 2018	Dec. 31, 2018	May 11, 2018
Share-based Compensation Arrangement by Share-based Payment Award
Shares reserved for future issuance		4,405,716
2018 ESPP
Share-based Compensation Arrangement by Share-based Payment Award
Shares authorized for issuance			235,743
Shares reserved for future issuance		235,743
Additional shares authorized under stock-based plans (in shares)	353,614
Increase as percentage of outstanding shares	1.00%
Shares issued		0

Equity-Based Compensation - 2013 Plan (Details) - 2013 Plan	12 Months Ended
	Dec. 31, 2013
Equity-Based Compensation
Vesting period	4 years
Expiration period	0 years
Tranche 1
Equity-Based Compensation
Vesting percentage	25.00%
Service period	12 months
Tranche 2
Equity-Based Compensation
Vesting percentage	75.00%
Service period	36 months

Equity-Based Compensation - Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Equity-based compensation
Equity-based compensation expense	$ 5,211	$ 1,482
Equity-based compensation expense related to modifications of equity awards	1,200
Research and development expense
Equity-based compensation
Equity-based compensation expense	1,661	704
General and administrative expense
Equity-based compensation
Equity-based compensation expense	$ 3,550	$ 778

Equity-Based Compensation - Non Options (Details) - USD ($) $ / shares in Units, $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Restricted common stock
Number of unvested awards
Outstanding, beginning (in shares)	1,220,085
Vested (in shares)	(547,786)
Forfeited (in shares)	(8,125)
Outstanding, end (in shares)	664,174	1,220,085
Weighted Average Fair Value
Outstanding, beginning (in dollars per share)	$ 5.77
Granted (in dollars per share)	5.77
Vested (in dollars per share)	5.77
Forfeited (in dollars per share)	5.77
Outstanding, end (in dollars per share)	$ 5.77	$ 5.77
Weighted Average Strike Price per Unit
Unrecognized equity based compensation expense	$ 2.9
Period for recognition	2 years
Incentive units
Number of Units
Outstanding, beginning (in shares)		1,758,252
Granted (in shares)		621,497
Forfeited (in shares)		(12,251)
Exchanged for common stock and restricted common stock pursuant to the Reorganization (in shares)		(2,367,498)
Weighted Average Fair Value
Outstanding, beginning (in dollars per share)		$ 2.03
Granted (in dollars per share)		3.63
Forfeited (in dollars per share)		2.86
Exchanged for common stock and restricted common stock pursuant to the Reorganization (in dollars per share)		2.43
Weighted Average Strike Price per Unit
Outstanding, beginning (in dollars per share)		1.09
Granted (in dollars per share)		2.63
Forfeited (in dollars per share)		2.23
Exchanged for common stock and restricted common stock pursuant to the Reorganization (in dollars per share)		$ 1.49

Equity-Based Compensation - Stock Options (Details) - Stock options $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2018 USD ($) $ / shares shares
Number of Units
Granted (in shares) \| shares	1,652,521
Exercised (in shares) \| shares	(898)
Forfeited (in shares) \| shares	(23,676)
Outstanding, end (in shares) \| shares	1,627,947
Options exercisable, end (in shares) \| shares	187,028
Weighted Average Exercise Price
Granted (in dollars per share)	$ 10.81
Exercised (in dollars per share)	5.77
Forfeited (in dollars per share)	7.48
Outstanding, end (in dollars per share)	10.86
Options exercisable, end (in dollars per share)	$ 9.37
Stock options
Weighted average remaining contractual term	9 years 3 months 4 days
Weighted average remaining contractual term, exercisable	8 years 8 months 23 days
Aggregate intrinsic value \| $	$ 19,831
Aggregate intrinsic value, exercisable \| $	$ 2,544
Weighted average grant date fair value (in dollars per share)	$ 10.81

Equity-Based Compensation - Assumptions (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Stock options
Assumptions used in determining the fair value of options
Unrecognized equity-based compensation expense	$ 10.5
Period for recognition	3 years 2 months 12 days
Stock options \| Employees
Assumptions used in determining the fair value of options
Risk-free interest rate	2.78%
Expected dividend yield	0.00%
Expected term (years to liquidity)	6 years 1 month 17 days
Expected volatility	81.22%
Stock options \| Non-employees
Assumptions used in determining the fair value of options
Risk-free interest rate	3.03%
Expected dividend yield	0.00%
Expected term (years to liquidity)	6 years 7 months 21 days
Expected volatility	77.05%
Incentive units
Assumptions used in determining the fair value of options
Risk-free interest rate, Minimum		1.48%
Risk-free interest rate, Maximum		1.97%
Expected dividend yield		0.00%
Incentive units \| Minimum
Assumptions used in determining the fair value of options
Expected term (years to liquidity)		2 years 7 months 17 days
Expected volatility, Minimum		71.00%
Incentive units \| Maximum
Assumptions used in determining the fair value of options
Expected term (years to liquidity)		3 years 2 months 23 days
Expected volatility, Maximum		77.00%

Income Taxes - Reconciliation (Details)	12 Months Ended
Income Taxes - Reconciliation (Details)	Dec. 31, 2018	Dec. 31, 2017
Effective income tax rate
Tax effected at statutory rate	21.00%	34.00%
State taxes	6.60%	8.10%
Stock compensation	(1.70%)	(2.00%)
Non-taxable income		0.30%
Non deductible expenses	(0.10%)	0.10%
Impact of federal rate change on net deferred taxes		(27.00%)
Federal research and development credits	5.90%	2.30%
Change in valuation allowance	(31.70%)	(15.80%)

Income Taxes - Deferred Tax Assets (Liabilities) (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Long-term net deferred tax assets:
Reserve and accruals	$ 1,031	$ 340
Net operating loss carryforwards	25,380	13,734
Deferred rent	242	190
Deferred revenue	3,525
Tax credits	4,976	1,665
Fixed and intangible assets	(498)	(128)
Stock based compensation	314
Total long-term net deferred tax assets	34,970	15,801
Valuation allowance	$ (34,970)	$ (15,801)

Income Taxes - Additional Information (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Income Tax Contingency
Increase in valuation allowance for deferred tax assets	$ 19.2	$ 4.0
Uncertain tax position	0.0	0.0
Estimated interest and penalty recognized on uncertain tax positions	0.0	$ 0.0
Federal
Income Tax Contingency
Net operating loss carryforwards	93.0
Tax credit carryforward amount	4.0
State
Income Tax Contingency
Net operating loss carryforwards	92.4
Tax credit carryforward amount	$ 1.1

Commitments and Contingencies (Details) - Facility Lease $ in Millions	1 Months Ended
	Feb. 28, 2018 USD ($) item	Mar. 31, 2015
Commitments and Contingencies
Term of lease		5 years
Number of options to extend the term of lease \| item	1
Lease extension term	5 years
Minimum
Commitments and Contingencies
Anticipated annual rent expense	$ 1.4
Maximum
Commitments and Contingencies
Anticipated annual rent expense	$ 1.7

Commitments and Contingencies - Operating Leases (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Minimum annual lease payment
2019	$ 1,382
2020	1,447
2021	1,623
2022	1,672
2023	1,137
Total minimum lease payments	7,261
Lease rent	$ 1,000	$ 500

Loan Payable (Details) - SVB $ in Millions	1 Months Ended
Loan Payable (Details) - SVB $ in Millions	Aug. 31, 2016	Aug. 31, 2015 USD ($) item	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)
Loan Payable
Line of credit maximum		$ 2.0
Number of equipment advances \| item		5
Threshold of equipment advance		$ 0.1
Amount borrowed			$ 0.4	$ 1.0	$ 2.0
Outstanding obligations (as a percent)	105.00%
Dollar value of company's accounts (as a percent)	100.00%
Threshold covenant compliance amount			$ 0.4	$ 1.1
Principal and interest payment term	36 months
Final payment fee (as a percent)	4.00%
Annual prime rate
Loan Payable
Variable rate (as a percent)	0.25%
Debt instrument, effective interest rate (as a percent)			4.25%	5.25%

Loan Payable - Future Payments (Details) - SVB - USD ($)	1 Months Ended	12 Months Ended
	Aug. 31, 2016	Dec. 31, 2018	Dec. 31, 2017
Loan Payable
2019		$ 365,000
Total Future Principal Payments		365,000
Debt discount		100,000
Deferred financing costs		19,000
Prepayment premium (as a percent)	0.50%
Incremental interest rate in event of default	5.00%
Interest expense		$ 100,000	$ 100,000

Agreements - Gilead (Details) $ / shares in Units, $ in Thousands		3 Months Ended	12 Months Ended
	Dec. 19, 2018 USD ($) item $ / shares shares	Jun. 30, 2018 USD ($) shares	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Agreements
Sale of common shares (in shares) \| shares		6,164,000
Sale of common shares		$ 77,800	$ 17,096
Contract liability			0	$ 0
Gilead
Agreements
Number of programs \| item	3
Option exercise period	90 days
Upfront payment received	$ 50,000
Potential milestone payments	475,000
Refundable payments under the agreement	$ 0
Sale of common shares (in shares) \| shares	980,392
Purchase price (in dollars per share) \| $ / shares	$ 30.60
Sale of common shares	$ 30,000
Maximum number of program antibodies to be notified which satisfies development criteria \| item	2
Transaction price	$ 80,000
Equity investment included in transaction price	17,100
Contract liability	62,900		62,900
Revenue received			$ 0
Gilead \| Development milestones
Agreements
Potential milestone payments	$ 25,000

Agreements - Gilead obligation period (Details)	Dec. 31, 2018
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 \| Gilead
Agreements
Expected to recognize remaining deferred revenue	3 years

Agreements - Janssen (Details) - USD ($) $ in Millions	Dec. 31, 2018	Dec. 31, 2017	Dec. 17, 2013
Agreements
Contract asset	$ 0.0	$ 0.0
Contract liability	$ 0.0	$ 0.0
Janssen \| Development milestones
Agreements
Potential milestone payments			$ 25.0
Potential milestone payment upon achievement of a development milestone			2.0
Janssen \| Regulatory milestones
Agreements
Potential milestone payments			97.0
Janssen \| Sales milestones
Agreements
Potential milestone payments			$ 130.0

Net Loss per Share - Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Loss per share
Net loss	$ (49,326)	$ (24,995)
Weighted average common shares outstanding, basic and diluted (in shares)	15,655,293	1,634,100
Net loss per share, basic and diluted (in dollars per share)	$ (3.15)	$ (15.30)

- Definition

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

+ References + Details

Net Loss per Share - Anti-dilutive (Details) - shares	12 Months Ended
Net Loss per Share - Anti-dilutive (Details) - shares	Dec. 31, 2018	Dec. 31, 2017
Anti-dilutive securities
Anti-dilutive securities excluded from the calculation of net loss per share	2,299,735	16,337,649
Convertible preferred stock
Anti-dilutive securities
Anti-dilutive securities excluded from the calculation of net loss per share		15,109,950
Restricted common stock
Anti-dilutive securities
Anti-dilutive securities excluded from the calculation of net loss per share	664,174	1,220,085
Warrant
Anti-dilutive securities
Anti-dilutive securities excluded from the calculation of net loss per share	7,614	7,614
Stock options
Anti-dilutive securities
Anti-dilutive securities excluded from the calculation of net loss per share	1,627,947

Retirement Plan (Details) - USD ($) $ in Thousands	12 Months Ended
Retirement Plan (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Retirement Plan
Company contributions	$ 0	$ 0

Related Party Transactions (Details)				12 Months Ended
Related Party Transactions (Details)	Oct. 10, 2016	Oct. 12, 2012	Oct. 10, 2012 item	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
CMCC
Related Party Transactions
Related party transaction amount				$ 10,000	$ 10,000
Potential milestone payable				1,300,000
Milestone payments				100,000
Related party expense				800,000	10,000
Amounts due				$ 700,000	10,000
CMCC \| Minimum
Related Party Transactions
Non-royalty income attributable to sublicense (as a percent)				10.00%
CMCC \| Maximum
Related Party Transactions
Non-royalty income attributable to sublicense (as a percent)				20.00%
Co-founders
Related Party Transactions
Related party expense				$ 200,000	200,000
Amounts due				$ 0	$ 0
Number of scientific co-founders \| item			2
Term of agreement		4 years
Extended additional term of agreement	4 years