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Description of Business and Basis of Presentation | 9 Months Ended
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Sep. 30, 2021
Accounting Policies [Abstract] |
Description of Business and Basis of Presentation | Description of Business and Basis of Presentation Description of Business Exicure, Inc. (the “Company”) is a clinical-stage biotechnology company developing therapeutics for neurology, immuno-oncology, inflammatory diseases, and other genetic disorders based on its proprietary Spherical Nucleic Acid, or SNA™, technology. The Company believes that its proprietary SNA architecture has distinct chemical and biological properties that may provide advantages over other nucleic acid therapeutics and may have therapeutic potential to target diseases not typically addressed with other nucleic acid therapeutics. The Company is in preclinical development of XCUR-FXN, a lipid-nanoparticle SNA-based therapeutic candidate, for the intrathecal treatment of Friedreich’s ataxia (“FA”). The Company’s therapeutic candidate cavrotolimod (AST-008) is in a Phase 1b/2 clinical trial in patients with advanced solid tumors. The Company believes one of the key strengths of its proprietary SNAs is that they have the potential for increased cellular uptake compared to conventional linear oligonucleotides and as a result the potential to achieve higher efficacy at the same doses of oligonucleotide administered. The Company has shown in clinical and preclinical studies that SNAs may have therapeutic potential in immuno-oncology and dermatology. In addition, the Company has shown in preclinical studies that SNAs may have therapeutic potential in neurology, ophthalmology, pulmonology, and gastroenterology. Accordingly, the Company has expanded its pipeline into neurology, for which investigational new drug application (“IND”)-enabling activities are ongoing for XCUR-FXN, and is concluding early stage research activities in ophthalmology, pulmonology, and gastroenterology. Throughout these unaudited condensed consolidated financial statements, the terms the “Company,” “Exicure,” “we,” “us,” and “our” refer to Exicure, Inc. and where appropriate, its wholly owned subsidiary, Exicure Operating Company. Exicure Operating Company holds all material assets and conducts all business activities and operations of Exicure, Inc. Basis of Presentation The accompanying unaudited condensed consolidated financial statements as of September 30, 2021 and December 31, 2020, and for the nine months ended September 30, 2021 and 2020, have been presented in conformity with generally accepted accounting principles in the United States (“GAAP”). Principles of Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of Exicure and its wholly owned subsidiary, Exicure Operating Company. All intercompany transactions and accounts are eliminated in consolidation. Significant Risks and Uncertainties As discussed in Note 3, Collaborative Research and License Agreements, revenue recognized under the AbbVie Collaboration Agreement (as defined in Note 3, Collaborative Research and License Agreements) for the three and nine months ended September 30, 2021 reflects the cumulative catchup adjustment (reduction) of revenue of $(4,480) recorded in connection with a change in estimate that occurred during the third quarter of 2021. The Company currently estimates significant additional efforts will be required to satisfy the performance obligation under the AbbVie Collaboration Agreement. These increased estimated efforts in connection with the change in workplan resulted in less progress occurring relative to the increased estimate of total project hours to complete the research services during the three and nine months ended September 30, 2021 as compared to the amount of revenue recognized at both June 30, 2021 and December 31, 2020, which led to revenue reversals in each respective period. Due to uncertainties inherent in the estimation process, it is at least reasonably possible that estimated efforts required to complete the research services under the AbbVie Collaboration Agreement will be further revised in the near-term which may result in additional adjustments (reductions of revenue) in future periods. As discussed in Note 2, Significant Accounting Policies — Revenue Recognition, determining the estimate of total project hours used to recognize revenue for our collaboration agreements requires significant judgment and any changes to those estimates may have a significant impact on the amount and timing of revenue recognition for the Ipsen Collaboration Agreement or the AbbVie Collaboration Agreement (each, as defined in Note 3, Collaborative Research and License Agreements) in future periods. COVID-19 Risks and Uncertainties In response to the ongoing COVID-19 pandemic, the Company has taken and continues to take active measures designed to address and mitigate the impact of the COVID-19 pandemic on its business, such as remote working policies, facilitating management’s routine communication to address employee and business concerns and providing frequent updates to the Company’s board of directors (the “Board”). During the third quarter of 2021 and through the date of this report, the Company continues to operate under COVID-19 social distancing guidelines and has generally operated with approximately 100% of its R&D staff on-site. The Company’s office and general and administrative team is also working on-site approximately 50% of the time. The Company’s preclinical development program in Friedreich’s ataxia (“FA”) is ongoing and it began IND-enabling studies for XCUR-FXN in late 2020. The Company also continues research and development activities with its collaboration partners, Ipsen Biopharm Limited (“Ipsen”) and AbbVie Inc. (“AbbVie”). However, if the COVID-19 pandemic continues to persist for an extended period of time, the Company could experience further significant disruptions to its clinical and preclinical development timelines, which would adversely affect its business, financial condition, results of operations and growth prospects. The Company believes that the effects of the COVID-19 pandemic or its impact contributed to delays that began during the third quarter of 2020 and continued into the second half of 2021 in its enrollment plans and clinical trial site start-ups for the Phase 2 dose expansion phase of the Phase 1b/2 clinical trial for its cavrotolimod (AST-008) clinical program. As a result of these delays, pending further delays or any additional unanticipated effects of the COVID-19 pandemic on its clinical development plans, the Company now expects to report overall response rate (“ORR”) results of cavrotolimod (AST-008) in the second half of 2022 as opposed to the previously reported first half of 2022. In the third quarter of 2020, the Company implemented, and continues to employ, additional measures to increase the enrollment of patients, including frequent interaction with its clinical trial sites currently open as well as increasing the number of clinical trial sites that potentially are activated for this trial so that the Company may continue to enroll patients as initially planned. However, any additional delays may require the Company to further lengthen its clinical development timeline for cavrotolimod (AST-008). The extent to which the COVID-19 pandemic or its impact or effects may continue to impact the Company’s business, its clinical development and regulatory efforts, its corporate development objectives and the value of and market for its common stock will depend on future developments that are highly uncertain and cannot be predicted with confidence at this time, such as the ultimate duration or spread of the COVID-19 pandemic, its impact and effects, the possibility of additional periods of increases or spikes in the number of COVID-19 cases, the introduction and spread of new variants of the virus, travel restrictions, quarantines, social distancing, phased re-openings and business closure requirements in the United States and other countries, and the effectiveness of actions taken globally to contain and treat the disease including, without limitation, the effectiveness and timing of vaccination initiatives in the United States and worldwide. The global economic slowdown, the overall disruption of global healthcare systems and the other risks and uncertainties associated with the COVID-19 pandemic could have a material adverse effect on the Company’s business, financial condition, results of operations and growth prospects. In addition, the Company is subject to other challenges and risks specific to its business and its ability to execute on its business plan and strategy, as well as risks and uncertainties common to companies in the biotechnology industry with research and development operations, including, without limitation, risks and uncertainties associated with: obtaining regulatory approval of its product candidates; delays or problems in obtaining clinical supply, loss of single source suppliers or failure to comply with manufacturing regulations; identifying, acquiring or in-licensing additional products or product candidates; product development and the inherent uncertainty of clinical success; and the challenges of protecting and enhancing its intellectual property rights; and the challenges of complying with applicable regulatory requirements. In addition, to the extent the ongoing COVID-19 pandemic adversely affects the Company’s business and results of operations, it may also have the effect of heightening many of the other risks and uncertainties. Going Concern At each reporting period, the Company evaluates whether there are conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The Company is required to make certain additional disclosures if it concludes substantial doubt exists and it is not alleviated by the Company’s plans or when its plans alleviate substantial doubt about the Company’s ability to continue as a going concern. As of September 30, 2021, the Company has generated an accumulated deficit of $175,079 since inception and expects to incur significant expenses and negative cash flows for the foreseeable future. Based on the Company’s current operating plans and existing working capital at September 30, 2021, it is uncertain whether our current liquidity is sufficient to fund operations over the next twelve months from the date of the issuance of these condensed consolidated financial statements. As a result, there is substantial doubt about our ability to continue as a going concern. The Company has no committed sources of additional capital at this time and substantial additional financing will be needed by the Company to fund its operations. Management believes that it will be able to obtain additional funding through equity or debt financings, collaboration agreements, strategic partnerships and licensing arrangements, or other arrangements, such as its “at the market offering” program pursuant to its equity distribution agreement with BMO Capital Markets Corp., to fund its current operations and business strategy. However, there can be no assurance that such additional financing will be available and, if available, can be obtained on terms acceptable to the Company. If the Company is unable to obtain such additional financing, the Company could be forced to delay, reduce or eliminate its research and development programs or clinical efforts, which could adversely affect its business prospects, or the Company may be unable to continue operations. The Company has historically principally raised capital through the public offerings of its securities. However, the COVID-19 pandemic continues to rapidly evolve and has already resulted in a significant disruption of global financial markets. If the disruption continues to persist and deepens, the Company could experience an inability to access additional capital, which could negatively affect its ability to raise capital and ultimately, its operations, liquidity and ability to continue as a going concern. The accompanying unaudited condensed consolidated interim financial statements have been prepared as though the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Unaudited Interim Financial Information The accompanying interim condensed consolidated balance sheet as of September 30, 2021, the interim condensed consolidated statements of operations for the three and nine months ended September 30, 2021 and 2020, the interim condensed consolidated statements of comprehensive (loss) income for the three and nine months ended September 30, 2021 and 2020, the interim condensed consolidated statements of changes in stockholders’ equity for the three and nine months ended September 30, 2021 and 2020, and the interim condensed consolidated statements of cash flows for the nine months ended September 30, 2021 and 2020, are unaudited. The interim unaudited condensed consolidated financial statements have been prepared on the same basis as the annual audited financial statements; and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the Company’s financial position as of September 30, 2021, the results of its operations for the three and nine months ended September 30, 2021 and 2020, and the results of its cash flows for the nine months ended September 30, 2021 and 2020. The financial data and other information disclosed in these notes related to the three and nine months ended September 30, 2021 and 2020 are unaudited. The results for the three and nine months ended September 30, 2021 are not necessarily indicative of results to be expected for the year ending December 31, 2021, or any other interim periods, or any future year or period. Use of Estimates The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management bases its estimates on certain assumptions which it believes are reasonable in the circumstances and while actual results could differ from those estimates, management does not believe that any change in those assumptions in the near term would have a significant effect on the Company’s financial position, results of operations or cash flows. Actual results in future periods could differ from those estimates.

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