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Commitments and Contingencies
 9 Months Ended
Sep. 30, 2024
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and Contingencies
Leases
The Company leases certain office and laboratory space under a non-cancelable operating lease expiring in January 2025 for the initial leased space and for the expansion space leased pursuant to an amendment to the lease agreement entered into in August 2018. The lease is subject to charges for common area maintenance and other costs, and base rent is subject to an annual 3% increase each subsequent year. Costs determined to be variable and not based on an index or rate were not included in the measurement of the operating lease liabilities.
On July 9, 2024, the Company entered into a lease agreement for office space located at 3115 Merryfield Row, Suite 120, San Diego, CA 92121, consisting of approximately 18,421 square feet. The term of the lease is 63 months commencing on August 1, 2024. The base rent is $109,605 per month effective October 1, 2024, and it is subject to a 3% annual increase every October. The lease expires on October 31, 2029 with an option for a one-year extension and an option to terminate on December 1, 2027 with the payment of a termination fee equal to four months of the then-current base rent upon the termination date.
Monthly rent expense is recognized on a straight-line basis over the term of the leases. The operating leases are included in the condensed consolidated balance sheets at the present value of the lease payments at an incremental borrowing rate of 7% for each of the initial leased space and expansion space and 12.4% for the office lease commenced on August 1, 2024 using the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment as the leases do not provide an implicit rate.
As of September 30, 2024, the weighted average remaining lease term was 4.5 years.
Lease costs were comprised of the following (in thousands):
Three months ended September 30,Nine months ended September 30,
2024202320242023
Operating lease cost$1,012 $778 $2,569 $2,335 
Short-term lease cost9 13 30 39 
Total lease cost$1,021 $791 $2,599 $2,374 
Cash paid for amounts included in the measurement of operating lease liabilities for the three months ended September 30, 2024 and 2023 was $0.7 million and $0.6 million, respectively, and cash paid for amounts included in the measurement of operating lease liabilities for the nine months ended September 30, 2024 and 2023 was $2.7 million and $2.5 million, respectively.
Gross future minimum annual rental commitments as of September 30, 2024, were as follows (in thousands):
Undiscounted Rent
Payments
Year ending December 31
2024 (remaining 3 months)$1,197 
20251,519 
20261,397 
20271,406 
20281,448 
20291,237 
Total undiscounted rent payments$8,204 
Present value discount(1,863)
Present value of lease payments$6,341 
Current portion of operating lease liabilities (included as a component of accrued expenses and other current liabilities)1,748 
Operating lease liabilities - long-term4,593 
Total operating lease liability$6,341 
For the three months ended September 30, 2024 and 2023, the Company recorded $1.1 million and $0.9 million, respectively, in rent expense. For the nine months ended September 30, 2024 and 2023, the Company recorded approximately $2.8 million and $2.6 million, respectively, in rent expense. Rent expense is included in research and development and general and administrative expense on the condensed consolidated statements of operations and comprehensive loss.