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Leases | 12 Months Ended
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Dec. 31, 2021
Leases [Abstract] |
Leases | 5. Leases Operating Leases In August 2015, the Company entered into an operating lease agreement with U.S. REIF Central Plaza Massachusetts, LLC (the “Landlord”) with respect to its corporate headquarters located at 675 Massachusetts Avenue, Cambridge, Massachusetts (the “Original Lease”). The term of the Original Lease commenced in January 2016 and was scheduled to expire in December 2020. Under the terms of the Original Lease, the Company provided a security deposit of $0.2 million to the Landlord, which is included in long-term assets in the accompanying condensed consolidated balance sheets. The Original Lease provided for annual rent escalations as well as tenant incentives in the amount of $0.7 million, of which $0.3 million would be reimbursed to the Landlord over the initial term of the Original Lease. On January 17, 2018, the Company entered into an amendment to the Original Lease (the “Amendment”). The Amendment made certain modifications to the Original Lease, including the addition of approximately 7,800 square feet of office space in the same building (the “Expansion Premises”) and an extension of the expiration date of the Original Lease to seven years, or December 2025. The Amendment also provided for $0.4 million from the Landlord for leasehold improvements on the Expansion Premises. On December 16, 2019, the Company entered into a second amendment to the Original Lease and the Amendment (the “Second Amendment”). The Second Amendment made certain modifications, including (i) the addition of approximately 7,800 square feet of office space in the same building (the “Second Expansion Premises”) with a term beginning in June 2020, and (ii) an extension of the expiration date of all existing leases through May 2027. Under the Second Amendment, the Company has two consecutive options to extend the Lease Term for an additional period of five years (the “Option Terms”), subject to certain conditions, upon notice to the Landlord. These renewal options were not included in the calculation of the operating lease assets and operating lease liabilities, as the renewal is not reasonably certain. The Second Amendment provides for annual base rent for the Second Expansion Premises of approximately $0.6 million in the first year of the Lease Term, which increases on an annual basis to approximately $0.7 million in the final year of the Lease Term, and annual base rent during the Option Terms to be calculated based on the Landlord’s good faith determination of 100% of the fair market rate for such Option Terms. The Company is also obligated to pay the Landlord certain costs, taxes and operating expenses, subject to certain exclusions. The Amendment also provides for $0.6 million from the Landlord for leasehold improvements on the Expansion Premises. On May 4, 2020, the Company entered into a third amendment to the Original Lease, as amended by the Second Amendment (the “Third Amendment”). The Third Amendment made certain modifications, including (i) amending the commencement date of the Second Expansion Premises with a term which began in August 2020, and (ii) an extension of the expiration date of all existing leases through July 2027. For the years ended December 31, 2021 and 2020, the components of operating lease expense were as follows (in thousands):
Operating lease expense |  | Statement of Operations Location |  | December 31, 2021 |  |  | December 31, 2020 |
Fixed operating lease expense |  | Research and development expense |  | $ | 869 |  |  | $ | 808 |
|  | General and administrative expense |  |  | 681 |  |  |  | 418 |
Variable operating lease expense |  | Research and development expense |  |  | 76 |  |  |  | 89 |
|  | General and administrative expense |  |  | 143 |  |  |  | 58 |
Total operating lease expense |  |  |  | $ | 1,769 |  |  | $ | 1,373 |
Supplemental cash flow information related to the Company’s operating leases for the years ended December 31, 2021 and 2020, was as follows (in thousands):
|  | December 31, 2021 |  |  | December 31, 2020 |
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |  |  |
Operating cash flows from operating leases |  | $ | 1,525 |  |  | $ | 1,171 |
Non-cash amounts resulting from the measurement of the lease liabilities: |  |  |  |  |  |
Right-of-use asset and lease obligation recorded upon commencement or amendment of lease agreements |  |  | - |  |  |  | 2,626 |
Embedded Finance Leases As part of our agreement with Meiji Seika Pharma Co. Ltd. (“Meiji”), the Company paid Meiji approximately $1.6 million during the year ended December 31, 2018, related to fixed assets which will be used in manufacturing related activities at Meiji. The Company determined this equipment to be an embedded finance lease and has been capitalized as property and equipment in the consolidated balance sheet as of December 31, 2021 and 2020. As this equipment was fully paid in 2018, there is no corresponding lease liability as of December 31, 2021 or 2020. The following table presents the lease balances within the consolidated balance sheet, weighted average remaining lease term, and the weighted average discount rates related to the Company’s operating and finance leases as of December 31, 2021 and 2020 (in thousands, except for the weighted average remaining lease term and the weighted average discount rate):
Lease Assets and Liabilities |  | Classification |  | December 31, 2021 |  |  | December 31, 2020 |
Assets |  |  |  |  |  |  |  |
Operating |  | Operating lease right-of-use assets |  | $ | 6,530 |  |  | $ | 7,114 |
Financing |  | Property and equipment, net |  |  | 468 |  |  |  | 736 |
Total leased assets |  |  |  | $ | 6,998 |  |  | $ | 7,850 |
Liabilities |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  |  |
Operating |  | Operating lease liabilities |  | $ | 1,362 |  |  | $ | 947 |
Non-Current |  |  |  |  |  |  |  |
Operating |  | Non-current operating lease liabilities |  |  | 5,973 |  |  |  | 6,891 |
Total lease liabilities |  |  |  | $ | 7,335 |  |  | $ | 7,838 |
Weighted average remaining lease term (in years) |  |  |  |  | 5.6 |  |  |  | 6.6 |
Weighted average discount rate |  |  |  |  | 9.8 | % |  |  | 9.8 | %
The following table presents the maturity of the Company’s operating lease liabilities as of December 31, 2021 (in thousands):
Years Ending December 31, |  |  |
2022 |  | $ | 1,362 |
2023 |  |  | 1,690 |
2024 |  |  | 1,718 |
2025 |  |  | 1,746 |
2026 |  |  | 1,956 |
Thereafter |  |  | 1,155 |
Total future minimum lease payments |  |  | 9,627 |
Less imputed interest |  |  | (2,292 | )
Total operating lease liabilities |  | $ | 7,335 |

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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
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