Restructuring Plan

9 Months Ended

Sep. 30, 2023

Restructuring and Related Activities [Abstract]

7. Restructuring Plan

During the three months ended September 30, 2023, the Company incurred $0.2 million of termination costs associated with the Restructuring Plan, primarily related to severance payments and healthcare benefits.

A summary of the restructuring costs recorded in the condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2023 is as follows (in thousands):


	Three Months Ended September 30, 2023
	ROU Asset Impairment		Severance and Benefits Costs		Stock-based Compensation		Total Restructuring Cost Recorded
General and administrative expense	$	—	$	189		33	$	222
Total restructuring costs	$	—	$	189	$	33	$	222


	Nine Months Ended September 30, 2023
	ROU Asset Impairment		Severance and Benefits Costs		Stock-based Compensation		Total Restructuring Cost Recorded
General and administrative expense	$	180	$	6,025	$	8,707	$	14,912
Research and development expense		—		1,342		488		1,830
Total restructuring costs	$	180	$	7,367	$	9,195	$	16,742

Employees affected by the reduction in workforce under the Restructuring Plan obtained involuntary termination benefits that are provided pursuant to a one-time benefit arrangement. For employees who were notified of their termination in February 2023 and had no requirement to provide future service beyond a minimum retention period, the Company recognized the liability for the full termination benefits at fair value in the first quarter of 2023. For employees who are required to provide services beyond a minimum retention period to receive their termination benefits, the Company recognizes the termination benefits ratably over their future service periods. The service periods began in February 2023 and the majority ended at various dates during the third quarter of 2023. The remaining service periods will continue through March 2024.

The activity in the restructuring liability is as follows (in thousands):


	Restructuring Liability 2023
Restructuring liability as of December 31, 2022	$	—
Severance costs incurred during the three months ended March 31, 2023		6,779
Severance costs paid during the three months ended March 31, 2023		(5,492	)
Restructuring liability as of March 31, 2023		1,287
Severance costs incurred during the three months ended June 30, 2023		399
Severance costs paid during the three months ended June 30, 2023		(919	)
Restructuring liability as of June 30, 2023		767
Severance costs incurred during the three months ended September 30, 2023		189
Severance costs paid during the three months ended September 30, 2023		(511	)
Restructuring liability as of September 30, 2023	$	445

The restructuring liability balance as of September 30, 2023 includes approximately $23,000 of estimated payments related to the continuation of healthcare coverage for periods greater than twelve months, which is included in other long-term liabilities on the balance sheet.

The Company expects to incur aggregate costs of approximately $16.9 million in connection with the Restructuring Plan. The remaining accrued restructuring liability is subject to assumptions, and actual amounts may differ. The Company may also incur additional costs not currently contemplated due to events that may occur as a result of, or that are associated with, the Restructuring Plan.

In October 2023, the Company further reduced its workforce by 10 employees. The Company expects to incur additional restructuring costs of $1.7 million in the fourth quarter of 2023 associated with this reduction.