x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
|
|
71-0872999
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(State or other jurisdiction of
incorporation or organization)
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|
(I.R.S. Employer
Identification No.)
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|
|
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200 Penobscot Drive, Redwood City, California
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|
94063
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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¨
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|
Accelerated filer
|
x
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Non-accelerated filer
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¨
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(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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|
|
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Emerging growth company
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¨
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PAGE
NUMBER
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|
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PART I. FINANCIAL INFORMATION
|
||
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|
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ITEM 1:
|
|
|
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|
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ITEM 2:
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ITEM 3:
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ITEM 4:
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ITEM 1:
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ITEM 1A:
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ITEM 2:
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ITEM 3:
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ITEM 4:
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ITEM 5:
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ITEM 6:
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June 30,
2018 |
|
December 31,
2017 |
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
53,621
|
|
|
$
|
31,219
|
|
Accounts receivable, net of allowances of $34 at June 30, 2018 and December 31, 2017
|
9,910
|
|
|
11,800
|
|
||
Inventories, net
|
1,036
|
|
|
1,036
|
|
||
Prepaid expenses and other current assets
|
1,162
|
|
|
984
|
|
||
Contract assets
|
554
|
|
|
—
|
|
||
Total current assets
|
66,283
|
|
|
45,039
|
|
||
Restricted cash
|
1,460
|
|
|
1,557
|
|
||
Marketable securities
|
676
|
|
|
671
|
|
||
Property and equipment, net
|
3,883
|
|
|
2,815
|
|
||
Goodwill
|
3,241
|
|
|
3,241
|
|
||
Other non-current assets
|
414
|
|
|
302
|
|
||
Total assets
|
$
|
75,957
|
|
|
$
|
53,625
|
|
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
3,082
|
|
|
$
|
3,545
|
|
Accrued compensation
|
3,817
|
|
|
4,753
|
|
||
Other accrued liabilities
|
5,051
|
|
|
4,362
|
|
||
Deferred revenue
|
4,460
|
|
|
12,292
|
|
||
Total current liabilities
|
16,410
|
|
|
24,952
|
|
||
Deferred revenue, net of current portion
|
4,994
|
|
|
1,501
|
|
||
Lease incentive obligation, net of current portion
|
248
|
|
|
460
|
|
||
Financing obligation, net of current portion
|
183
|
|
|
302
|
|
||
Other long-term liabilities
|
1,592
|
|
|
1,863
|
|
||
Total liabilities
|
23,427
|
|
|
29,078
|
|
||
|
|
|
|
||||
Commitments and Contingencies (Note 11)
|
|
|
|
|
|
||
Stockholders' equity:
|
|
|
|
||||
Preferred stock, $0.0001 par value per share; 5,000 shares authorized; none issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $0.0001 par value per share; 100,000 shares authorized; 53,508 shares and 48,365 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively
|
5
|
|
|
5
|
|
||
Additional paid-in capital
|
380,551
|
|
|
340,079
|
|
||
Accumulated other comprehensive loss
|
—
|
|
|
(472
|
)
|
||
Accumulated deficit
|
(328,026
|
)
|
|
(315,065
|
)
|
||
Total stockholders' equity
|
52,530
|
|
|
24,547
|
|
||
Total liabilities and stockholders' equity
|
$
|
75,957
|
|
|
$
|
53,625
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Product revenue
|
$
|
3,723
|
|
|
$
|
6,600
|
|
|
$
|
9,886
|
|
|
$
|
12,186
|
|
Research and development revenue
|
9,815
|
|
|
3,747
|
|
|
17,694
|
|
|
6,131
|
|
||||
Total revenues
|
13,538
|
|
|
10,347
|
|
|
27,580
|
|
|
18,317
|
|
||||
Costs and operating expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of product revenue
|
2,611
|
|
|
3,790
|
|
|
6,436
|
|
|
6,792
|
|
||||
Research and development
|
7,370
|
|
|
6,348
|
|
|
14,548
|
|
|
12,187
|
|
||||
Selling, general and administrative
|
7,395
|
|
|
6,546
|
|
|
15,141
|
|
|
13,152
|
|
||||
Total costs and operating expenses
|
17,376
|
|
|
16,684
|
|
|
36,125
|
|
|
32,131
|
|
||||
Loss from operations
|
(3,838
|
)
|
|
(6,337
|
)
|
|
(8,545
|
)
|
|
(13,814
|
)
|
||||
Interest income
|
174
|
|
|
49
|
|
|
245
|
|
|
68
|
|
||||
Other expenses, net
|
(82
|
)
|
|
(34
|
)
|
|
(142
|
)
|
|
(12
|
)
|
||||
Loss before income taxes
|
(3,746
|
)
|
|
(6,322
|
)
|
|
(8,442
|
)
|
|
(13,758
|
)
|
||||
Benefit from income taxes
|
(11
|
)
|
|
(42
|
)
|
|
(13
|
)
|
|
(18
|
)
|
||||
Net loss
|
$
|
(3,735
|
)
|
|
$
|
(6,280
|
)
|
|
$
|
(8,429
|
)
|
|
$
|
(13,740
|
)
|
|
|
|
|
|
|
|
|
||||||||
Net loss per share, basic and diluted
|
$
|
(0.07
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.17
|
)
|
|
$
|
(0.31
|
)
|
Weighted average common stock shares used in computing net loss per share, basic and diluted
|
52,787
|
|
|
47,232
|
|
|
50,598
|
|
|
44,258
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net loss
|
$
|
(3,735
|
)
|
|
$
|
(6,280
|
)
|
|
$
|
(8,429
|
)
|
|
$
|
(13,740
|
)
|
Other comprehensive income
|
|
|
|
|
|
|
|
||||||||
Unrealized gain on marketable securities, net of tax
(1)
|
—
|
|
|
194
|
|
|
—
|
|
|
102
|
|
||||
Other comprehensive income
|
—
|
|
|
194
|
|
|
—
|
|
|
102
|
|
||||
Total comprehensive loss
|
$
|
(3,735
|
)
|
|
$
|
(6,086
|
)
|
|
$
|
(8,429
|
)
|
|
$
|
(13,638
|
)
|
|
Six Months Ended June 30,
|
||||||
|
2018
|
|
2017
|
||||
Operating activities:
|
|
|
|
||||
Net loss
|
$
|
(8,429
|
)
|
|
$
|
(13,740
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Depreciation and amortization
|
503
|
|
|
554
|
|
||
Gain on disposal of property and equipment
|
1
|
|
|
(3
|
)
|
||
Income tax benefit related to marketable securities
|
—
|
|
|
(60
|
)
|
||
Stock-based compensation
|
4,437
|
|
|
3,379
|
|
||
Unrealized gain on investment in marketable securities
|
(5
|
)
|
|
—
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
2,954
|
|
|
(1,879
|
)
|
||
Inventories, net
|
—
|
|
|
19
|
|
||
Prepaid expenses and other current assets
|
(132
|
)
|
|
(1,824
|
)
|
||
Contract Assets
|
(554
|
)
|
|
—
|
|
||
Other assets
|
79
|
|
|
(44
|
)
|
||
Accounts payable
|
(530
|
)
|
|
(446
|
)
|
||
Accrued compensation
|
(936
|
)
|
|
(1,394
|
)
|
||
Other accrued liabilities
|
451
|
|
|
271
|
|
||
Long term lease incentive
|
(212
|
)
|
|
(212
|
)
|
||
Other long term liabilities
|
(302
|
)
|
|
(56
|
)
|
||
Deferred revenue
|
(9,466
|
)
|
|
3,904
|
|
||
Net cash used in operating activities
|
(12,141
|
)
|
|
(11,531
|
)
|
||
Investing activities:
|
|
|
|
||||
Purchase of property and equipment
|
(1,472
|
)
|
|
(680
|
)
|
||
Proceeds from disposal of property and equipment
|
—
|
|
|
3
|
|
||
Net cash used in investing activities
|
(1,472
|
)
|
|
(677
|
)
|
||
Financing activities:
|
|
|
|
||||
Proceeds from exercises of stock options
|
1,858
|
|
|
142
|
|
||
Proceeds from issuance of common stock in connection with public offering, net of underwriting discounts and commission
|
37,497
|
|
|
23,782
|
|
||
Costs incurred in connection with public offering
|
(179
|
)
|
|
(491
|
)
|
||
Principal payments on capital lease obligations
|
(118
|
)
|
|
(60
|
)
|
||
Taxes paid related to net share settlement of equity awards
|
(3,140
|
)
|
|
(1,636
|
)
|
||
Net cash provided by financing activities
|
35,918
|
|
|
21,737
|
|
||
Net increase in cash, cash equivalents and restricted cash
|
22,305
|
|
|
9,529
|
|
||
Cash, cash equivalents and restricted cash at the beginning of the period
|
32,776
|
|
|
20,864
|
|
||
Cash, cash equivalents and restricted cash at the end of the period
|
$
|
55,081
|
|
|
$
|
30,393
|
|
|
|
|
|
||||
Supplemental disclosure of cash flow information:
|
|
|
|
||||
Interest paid
|
$
|
42
|
|
|
$
|
117
|
|
Income taxes paid
|
$
|
5
|
|
|
$
|
5
|
|
Supplemental non-cash investing and financing activities:
|
|
|
|
||||
Equipment acquired under capital leases
|
$
|
—
|
|
|
$
|
840
|
|
Purchase of property and equipment recorded in accounts payable and accrued expenses
|
$
|
67
|
|
|
$
|
34
|
|
|
Six Months Ended June 30,
|
||||||
|
2018
|
|
2017
|
||||
Cash and cash equivalents
|
$
|
53,621
|
|
|
$
|
28,817
|
|
Restricted cash included in non-current assets
|
1,460
|
|
|
1,576
|
|
||
Total cash, cash equivalents and restricted cash at the end of the period
|
$
|
55,081
|
|
|
$
|
30,393
|
|
•
|
Level 1: Inputs that are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.
|
•
|
Level 2: Inputs that are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life.
|
•
|
Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities and which reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date.
|
|
Three months ended June 30, 2018
|
|
Three months ended June 30, 2017
|
||||||||||||||||||||
(in thousands)
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
||||||||||||
Major products and service:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Product Revenue
|
$
|
3,723
|
|
|
$
|
—
|
|
|
$
|
3,723
|
|
|
$
|
6,600
|
|
|
$
|
—
|
|
|
$
|
6,600
|
|
Research and development revenue
|
7,442
|
|
|
2,373
|
|
|
9,815
|
|
|
3,747
|
|
|
—
|
|
|
3,747
|
|
||||||
Total revenues
|
$
|
11,165
|
|
|
$
|
2,373
|
|
|
$
|
13,538
|
|
|
$
|
10,347
|
|
|
$
|
—
|
|
|
$
|
10,347
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Primary geographical markets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Americas
|
$
|
6,058
|
|
|
$
|
—
|
|
|
$
|
6,058
|
|
|
$
|
4,401
|
|
|
$
|
—
|
|
|
$
|
4,401
|
|
EMEA
|
1,435
|
|
|
2,373
|
|
|
3,808
|
|
|
1,959
|
|
|
—
|
|
|
1,959
|
|
||||||
APAC
|
3,672
|
|
|
—
|
|
|
3,672
|
|
|
3,987
|
|
|
—
|
|
|
3,987
|
|
||||||
Total revenues
|
$
|
11,165
|
|
|
$
|
2,373
|
|
|
$
|
13,538
|
|
|
$
|
10,347
|
|
|
$
|
—
|
|
|
$
|
10,347
|
|
|
Six months ended June 30, 2018
|
|
Six months ended June 30, 2017
|
||||||||||||||||||||
(in thousands)
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
||||||||||||
Major products and service:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Product Revenue
|
$
|
9,886
|
|
|
$
|
—
|
|
|
$
|
9,886
|
|
|
$
|
12,186
|
|
|
$
|
—
|
|
|
$
|
12,186
|
|
Research and development revenue
|
12,008
|
|
|
5,686
|
|
|
17,694
|
|
|
6,131
|
|
|
—
|
|
|
6,131
|
|
||||||
Total revenues
|
$
|
21,894
|
|
|
$
|
5,686
|
|
|
$
|
27,580
|
|
|
$
|
18,317
|
|
|
$
|
—
|
|
|
$
|
18,317
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Primary geographical markets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Americas
|
$
|
9,655
|
|
|
$
|
—
|
|
|
$
|
9,655
|
|
|
$
|
6,189
|
|
|
$
|
—
|
|
|
$
|
6,189
|
|
EMEA
|
3,114
|
|
|
5,686
|
|
|
8,800
|
|
|
5,166
|
|
|
—
|
|
|
5,166
|
|
||||||
APAC
|
9,125
|
|
|
—
|
|
|
9,125
|
|
|
6,962
|
|
|
—
|
|
|
6,962
|
|
||||||
Total revenues
|
$
|
21,894
|
|
|
$
|
5,686
|
|
|
$
|
27,580
|
|
|
$
|
18,317
|
|
|
$
|
—
|
|
|
$
|
18,317
|
|
|
Balance
|
||
Deferred Revenue, balance at December 31, 2017
|
$
|
13,793
|
|
Changes in estimated consideration
|
—
|
|
|
Unsatisfied performance obligations
|
$
|
5,173
|
|
Deferred Revenue, balance at January 1, 2018
|
$
|
18,966
|
|
|
June 30, 2018
|
||||||||||||||
|
January 1, 2018 balance
|
|
Additions
|
|
Deductions
(1)
|
|
Ending balance
|
||||||||
Contract Assets
|
$
|
—
|
|
|
$
|
3,047
|
|
|
$
|
(2,493
|
)
|
|
$
|
554
|
|
Contract Costs
|
239
|
|
|
—
|
|
|
(80
|
)
|
|
159
|
|
||||
Contract Liabilities: Deferred Revenue
|
18,966
|
|
|
1,965
|
|
|
(11,477
|
)
|
|
9,454
|
|
Revenue recognized in the period from:
|
Three months ended June 30, 2018
|
|
Six months ended June 30, 2018
|
||||
Amounts included in contract liabilities at the beginning of the period:
|
|
|
|
||||
Performance obligations satisfied
|
$
|
2,994
|
|
|
$
|
8,822
|
|
Changes in the period:
|
|
|
|
||||
Changes in the estimated transaction price allocated to performance obligations satisfied in prior periods
|
64
|
|
|
64
|
|
||
Performance obligations satisfied from new activities in the period - contract revenue
|
10,480
|
|
|
18,694
|
|
||
Total revenue
|
$
|
13,538
|
|
|
$
|
27,580
|
|
(in thousands)
|
2018
|
|
2019
|
|
2020
|
|
2021 and Thereafter
|
|
Total
|
||||||||||
Product Revenue
|
$
|
664
|
|
|
$
|
2,753
|
|
|
$
|
2,183
|
|
|
$
|
1,623
|
|
|
$
|
7,223
|
|
Research and development revenue
|
1,756
|
|
|
475
|
|
|
—
|
|
|
—
|
|
|
2,231
|
|
|||||
Total
|
$
|
2,420
|
|
|
$
|
3,228
|
|
|
$
|
2,183
|
|
|
$
|
1,623
|
|
|
$
|
9,454
|
|
|
Three months ended June 30, 2018
|
|
Six months ended June 30, 2018
|
||||||||||||||||||||
|
As reported
|
|
Adjustments
|
|
Balances without adoption of Topic 606
|
|
As reported
|
|
Adjustments
|
|
Balances without adoption of Topic 606
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Product revenue
|
$
|
3,723
|
|
|
$
|
(454
|
)
|
|
$
|
3,269
|
|
|
$
|
9,886
|
|
|
$
|
(2,970
|
)
|
|
$
|
6,916
|
|
Research and development revenue
|
9,815
|
|
|
(1,148
|
)
|
|
8,667
|
|
|
17,694
|
|
|
(2,470
|
)
|
|
15,224
|
|
||||||
Total revenues
|
13,538
|
|
|
(1,602
|
)
|
|
11,936
|
|
|
27,580
|
|
|
(5,440
|
)
|
|
22,140
|
|
||||||
Costs and operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of product revenue
|
2,611
|
|
|
(69
|
)
|
|
2,542
|
|
|
6,436
|
|
|
(1,355
|
)
|
|
5,081
|
|
||||||
Research and development
|
7,370
|
|
|
(33
|
)
|
|
7,337
|
|
|
14,548
|
|
|
(80
|
)
|
|
14,468
|
|
||||||
Selling, general and administrative
|
7,395
|
|
|
—
|
|
|
7,395
|
|
|
15,141
|
|
|
—
|
|
|
15,141
|
|
||||||
Total costs and operating expenses
|
17,376
|
|
|
(102
|
)
|
|
17,274
|
|
|
36,125
|
|
|
(1,435
|
)
|
|
34,690
|
|
||||||
Loss from operations
|
(3,838
|
)
|
|
(1,500
|
)
|
|
(5,338
|
)
|
|
(8,545
|
)
|
|
(4,005
|
)
|
|
(12,550
|
)
|
||||||
Interest income
|
174
|
|
|
—
|
|
|
174
|
|
|
245
|
|
|
—
|
|
|
245
|
|
||||||
Other expenses
|
(82
|
)
|
|
—
|
|
|
(82
|
)
|
|
(142
|
)
|
|
—
|
|
|
(142
|
)
|
||||||
Loss before income taxes
|
(3,746
|
)
|
|
(1,500
|
)
|
|
(5,246
|
)
|
|
(8,442
|
)
|
|
(4,005
|
)
|
|
(12,447
|
)
|
||||||
Provision (benefit) from income taxes
|
(11
|
)
|
|
—
|
|
|
(11
|
)
|
|
(13
|
)
|
|
—
|
|
|
(13
|
)
|
||||||
Net loss
|
$
|
(3,735
|
)
|
|
$
|
(1,500
|
)
|
|
$
|
(5,235
|
)
|
|
$
|
(8,429
|
)
|
|
$
|
(4,005
|
)
|
|
$
|
(12,434
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net loss per share, basic and diluted
|
$
|
(0.07
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
(0.17
|
)
|
|
$
|
(0.08
|
)
|
|
$
|
(0.25
|
)
|
Weighted average common shares used in computing net loss per share, basic and diluted
|
52,787
|
|
|
|
|
52,787
|
|
|
50,598
|
|
|
|
|
50,598
|
|
|
June 30, 2018
|
||||||||||
|
As reported
|
|
Adjustments
|
|
Balances without adoption of Topic 606
|
||||||
Assets
|
|
|
|
|
|
||||||
Accounts Receivable
|
$
|
9,910
|
|
|
$
|
(1,136
|
)
|
|
$
|
8,774
|
|
Contract Assets
|
554
|
|
|
(554
|
)
|
|
—
|
|
|||
Other non-current assets
|
414
|
|
|
(159
|
)
|
|
255
|
|
|||
Liabilities
|
|
|
|
|
|
||||||
Other accrued liabilities
|
5,051
|
|
|
(1,591
|
)
|
|
3,460
|
|
|||
Deferred revenue - current
|
4,460
|
|
|
2,909
|
|
|
7,369
|
|
|||
Deferred revenue - non-current
|
4,994
|
|
|
(3,220
|
)
|
|
1,774
|
|
|||
Stockholders' equity
|
|
|
|
|
|
|
|
|
|||
Accumulated deficit
|
(328,026
|
)
|
|
55
|
|
|
(327,971
|
)
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Shares of common stock issuable pursuant to equity awards outstanding under the Equity Incentive Plan
|
7,462
|
|
|
7,621
|
|
|
7,462
|
|
|
7,621
|
|
Shares of common stock issuable upon exercise of outstanding warrants
|
—
|
|
|
73
|
|
|
—
|
|
|
73
|
|
Total shares excluded as anti-dilutive
|
7,462
|
|
|
7,694
|
|
|
7,462
|
|
|
7,694
|
|
|
June 30, 2018
|
||||||||||||||
|
Adjusted Cost
|
|
Gross Unrealized
Gains |
|
Gross Unrealized
Losses |
|
Estimated
Fair Value |
||||||||
Money market funds
(1)
|
$
|
30,913
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
30,913
|
|
Common shares of CO2 Solutions
(2)
|
563
|
|
|
113
|
|
|
—
|
|
|
676
|
|
||||
Total
|
$
|
31,476
|
|
|
$
|
113
|
|
|
$
|
—
|
|
|
$
|
31,589
|
|
|
December 31, 2017
|
||||||||||||||
|
Adjusted Cost
|
|
Gross Unrealized
Gains |
|
Gross Unrealized
Losses |
|
Estimated
Fair Value |
||||||||
Money market funds
(1)
|
$
|
6,778
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,778
|
|
Common shares of CO2
Solutions
(2)
|
563
|
|
|
108
|
|
|
—
|
|
|
671
|
|
||||
Total
|
$
|
7,341
|
|
|
$
|
108
|
|
|
$
|
—
|
|
|
$
|
7,449
|
|
|
June 30, 2018
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Money market funds
(1)
|
$
|
30,913
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
30,913
|
|
Common shares of CO2 Solutions
(2)
|
—
|
|
|
676
|
|
|
—
|
|
|
676
|
|
||||
Total
|
$
|
30,913
|
|
|
$
|
676
|
|
|
$
|
—
|
|
|
$
|
31,589
|
|
|
December 31, 2017
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Money market funds
(1)
|
$
|
6,778
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,778
|
|
Common shares of CO2
Solutions
(2)
|
—
|
|
|
671
|
|
|
—
|
|
|
671
|
|
||||
Total
|
$
|
6,778
|
|
|
$
|
671
|
|
|
$
|
—
|
|
|
$
|
7,449
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Raw materials
|
$
|
214
|
|
|
$
|
215
|
|
Work-in-process
|
62
|
|
|
53
|
|
||
Finished goods
|
2,157
|
|
|
2,147
|
|
||
Less: reserve
|
(1,397
|
)
|
|
(1,379
|
)
|
||
Inventories, net
|
$
|
1,036
|
|
|
$
|
1,036
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Laboratory equipment
(1)
|
$
|
20,636
|
|
|
$
|
19,777
|
|
Leasehold improvements
|
10,358
|
|
|
10,327
|
|
||
Computer equipment and software
|
3,770
|
|
|
3,695
|
|
||
Office equipment and furniture
|
1,195
|
|
|
1,185
|
|
||
Construction in progress
(2)
|
457
|
|
|
85
|
|
||
Property and equipment
|
36,416
|
|
|
35,069
|
|
||
Less: accumulated depreciation and amortization
|
(32,533
|
)
|
|
(32,254
|
)
|
||
Property and equipment, net
|
$
|
3,883
|
|
|
$
|
2,815
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Accrued purchases
(1)
|
$
|
834
|
|
|
$
|
941
|
|
Accrued professional and outside service fees
|
1,666
|
|
|
2,393
|
|
||
Accrued expenses - cost of sales
|
1,387
|
|
|
—
|
|
||
Deferred rent
|
297
|
|
|
258
|
|
||
Lease incentive obligation
|
425
|
|
|
425
|
|
||
Other
|
442
|
|
|
345
|
|
||
Total
|
$
|
5,051
|
|
|
$
|
4,362
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Research and development
|
$
|
567
|
|
|
$
|
342
|
|
|
$
|
1,003
|
|
|
$
|
664
|
|
Selling, general and administrative
|
1,890
|
|
|
1,369
|
|
|
3,434
|
|
|
2,715
|
|
||||
Total
|
$
|
2,457
|
|
|
$
|
1,711
|
|
|
$
|
4,437
|
|
|
$
|
3,379
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Stock options
|
$
|
535
|
|
|
$
|
380
|
|
|
$
|
1,015
|
|
|
$
|
714
|
|
RSUs and RSAs
|
436
|
|
|
484
|
|
|
878
|
|
|
943
|
|
||||
PSUs
|
426
|
|
|
348
|
|
|
844
|
|
|
988
|
|
||||
PBOs
|
1,060
|
|
|
499
|
|
|
1,700
|
|
|
734
|
|
||||
Total
|
$
|
2,457
|
|
|
$
|
1,711
|
|
|
$
|
4,437
|
|
|
$
|
3,379
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||
|
(1)
|
|
(1)
|
|
|
|
|
||||||
Expected term (in years)
|
—
|
|
|
—
|
|
|
5.6
|
|
|
5.3
|
|
||
Volatility
|
—
|
|
|
—
|
|
|
60
|
%
|
|
62
|
%
|
||
Risk-free interest rate
|
—
|
|
|
—
|
|
|
2.70
|
%
|
|
2.00
|
%
|
||
Dividend yield
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
%
|
||
Weighted-average estimated fair value of stock options granted
|
—
|
|
|
—
|
|
|
$
|
5.02
|
|
|
$
|
2.52
|
|
|
Common Stock
|
|
Additional
paid-in Capital |
|
Accumulated Other
Comprehensive Income (Loss) |
|
Accumulated Deficit
|
|
Total Stockholders' Equity
|
|||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
Balance at December 31, 2016
|
41,255
|
|
|
$
|
4
|
|
|
$
|
311,164
|
|
|
$
|
—
|
|
|
$
|
(292,069
|
)
|
|
$
|
19,099
|
|
Exercise of stock options
|
56
|
|
|
—
|
|
|
142
|
|
|
—
|
|
|
—
|
|
|
142
|
|
|||||
Release of stock awards
|
1,079
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Employee stock-based compensation
|
—
|
|
|
—
|
|
|
3,379
|
|
|
—
|
|
|
—
|
|
|
3,379
|
|
|||||
Net shares settlements for taxes
|
(391
|
)
|
|
—
|
|
|
(1,636
|
)
|
|
—
|
|
|
—
|
|
|
(1,636
|
)
|
|||||
Issuance of common stock, net of issuance costs
|
6,325
|
|
|
1
|
|
|
23,290
|
|
|
—
|
|
|
—
|
|
|
23,291
|
|
|||||
Total comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
102
|
|
|
(13,740
|
)
|
|
(13,638
|
)
|
|||||
Balance at June 30, 2017
|
48,324
|
|
|
$
|
5
|
|
|
$
|
336,339
|
|
|
$
|
102
|
|
|
$
|
(305,809
|
)
|
|
$
|
30,637
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance at December 31, 2017
|
48,365
|
|
|
$
|
5
|
|
|
$
|
340,079
|
|
|
$
|
(472
|
)
|
|
$
|
(315,065
|
)
|
|
$
|
24,547
|
|
Exercise of stock options
|
303
|
|
|
—
|
|
|
1,858
|
|
|
—
|
|
|
—
|
|
|
1,858
|
|
|||||
Release of stock awards
|
824
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Employee stock-based compensation
|
—
|
|
|
—
|
|
|
4,413
|
|
|
—
|
|
|
—
|
|
|
4,413
|
|
|||||
Non-employee stock-based compensation
|
—
|
|
|
—
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|
24
|
|
|||||
Net shares settlements for taxes
|
(297
|
)
|
|
—
|
|
|
(3,140
|
)
|
|
—
|
|
|
—
|
|
|
(3,140
|
)
|
|||||
Issuance of common stock, net of issuance costs of $179
|
4,313
|
|
|
—
|
|
|
37,317
|
|
|
—
|
|
|
—
|
|
|
37,317
|
|
|||||
ASC 606 Adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,060
|
)
|
|
(4,060
|
)
|
|||||
ASU 2016-01 Adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
472
|
|
|
(472
|
)
|
|
—
|
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,429
|
)
|
|
(8,429
|
)
|
|||||
Balance at June 30, 2018
|
53,508
|
|
|
$
|
5
|
|
|
$
|
380,551
|
|
|
$
|
—
|
|
|
$
|
(328,026
|
)
|
|
$
|
52,530
|
|
Years ending December 31,
|
Capital Leases
|
|
Operating Leases
|
||||
2018 (remaining 6 months)
|
$
|
126
|
|
|
$
|
1,598
|
|
2019
|
252
|
|
|
3,280
|
|
||
2020
|
61
|
|
|
712
|
|
||
2021
|
—
|
|
|
490
|
|
||
2022
|
—
|
|
|
41
|
|
||
Total minimum lease payments
(1)
|
439
|
|
|
$
|
6,121
|
|
|
Less: amount representing interest
|
(19
|
)
|
|
|
|||
Present value of capital lease obligations
|
420
|
|
|
|
|||
Less: current portion
|
(237
|
)
|
|
|
|||
Long-term portion of capital leases
|
$
|
183
|
|
|
|
Other Commitment Agreement Type
|
Agreement Date
|
|
Future Minimum Payment
|
||
Manufacture and supply agreement with expected future payment date of December 2022
|
April 2016
|
|
$
|
1,693
|
|
Service agreement for the development of manufacturing process
|
April 2017
|
|
2
|
|
|
Service agreement for stability study
|
July 2017
|
|
439
|
|
|
Service agreement for clinical trial
|
December 2017
|
|
$
|
2,116
|
|
Total other commitments
|
|
|
$
|
4,250
|
|
|
|
Three months ended June 30, 2018
|
|
Three months ended June 30, 2017
|
||||||||||||||||||||
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Product revenue
|
|
$
|
3,723
|
|
|
$
|
—
|
|
|
$
|
3,723
|
|
|
$
|
6,600
|
|
|
$
|
—
|
|
|
$
|
6,600
|
|
Research and development revenue
|
|
7,442
|
|
|
2,373
|
|
|
9,815
|
|
|
3,747
|
|
|
—
|
|
|
3,747
|
|
||||||
Total revenues
|
|
11,165
|
|
|
2,373
|
|
|
13,538
|
|
|
10,347
|
|
|
—
|
|
|
10,347
|
|
||||||
Costs and operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of product revenue
|
|
2,611
|
|
|
—
|
|
|
2,611
|
|
|
3,790
|
|
|
—
|
|
|
3,790
|
|
||||||
Research and development
(1)
|
|
4,724
|
|
|
2,442
|
|
|
7,166
|
|
|
4,023
|
|
|
2,149
|
|
|
6,172
|
|
||||||
Selling, general and administrative
|
|
1,729
|
|
|
304
|
|
|
2,033
|
|
|
1,777
|
|
|
—
|
|
|
1,777
|
|
||||||
Total segment costs and operating expenses
|
|
9,064
|
|
|
2,746
|
|
|
11,810
|
|
|
9,590
|
|
|
2,149
|
|
|
11,739
|
|
||||||
Income (loss) from operations
|
|
$
|
2,101
|
|
|
$
|
(373
|
)
|
|
$
|
1,728
|
|
|
$
|
757
|
|
|
$
|
(2,149
|
)
|
|
$
|
(1,392
|
)
|
Corporate costs
(2)
|
|
|
|
|
|
(5,209
|
)
|
|
|
|
|
|
(4,702
|
)
|
||||||||||
Depreciation and amortization
|
|
|
|
|
|
(265
|
)
|
|
|
|
|
|
(228
|
)
|
||||||||||
Loss before income taxes
|
|
|
|
|
|
$
|
(3,746
|
)
|
|
|
|
|
|
$
|
(6,322
|
)
|
|
|
Six months ended June 30, 2018
|
|
Six months ended June 30, 2017
|
||||||||||||||||||||
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Product revenue
|
|
$
|
9,886
|
|
|
$
|
—
|
|
|
$
|
9,886
|
|
|
$
|
12,186
|
|
|
$
|
—
|
|
|
$
|
12,186
|
|
Research and development revenue
|
|
12,008
|
|
|
5,686
|
|
|
17,694
|
|
|
6,131
|
|
|
—
|
|
|
6,131
|
|
||||||
Total revenues
|
|
21,894
|
|
|
5,686
|
|
|
27,580
|
|
|
18,317
|
|
|
—
|
|
|
18,317
|
|
||||||
Costs and operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of product revenue
|
|
6,436
|
|
|
—
|
|
|
6,436
|
|
|
6,792
|
|
|
—
|
|
|
6,792
|
|
||||||
Research and development
(1)
|
|
9,790
|
|
|
4,374
|
|
|
14,164
|
|
|
8,172
|
|
|
3,660
|
|
|
11,832
|
|
||||||
Selling, general and administrative
|
|
3,825
|
|
|
450
|
|
|
4,275
|
|
|
3,589
|
|
|
—
|
|
|
3,589
|
|
||||||
Total segment costs and operating expenses
|
|
20,051
|
|
|
4,824
|
|
|
24,875
|
|
|
18,553
|
|
|
3,660
|
|
|
22,213
|
|
||||||
Income (loss) from operations
|
|
$
|
1,843
|
|
|
$
|
862
|
|
|
$
|
2,705
|
|
|
$
|
(236
|
)
|
|
$
|
(3,660
|
)
|
|
$
|
(3,896
|
)
|
Corporate costs
(2)
|
|
|
|
|
|
(10,644
|
)
|
|
|
|
|
|
(9,308
|
)
|
||||||||||
Depreciation and amortization
|
|
|
|
|
|
(503
|
)
|
|
|
|
|
|
(554
|
)
|
||||||||||
Loss before income taxes
|
|
|
|
|
|
$
|
(8,442
|
)
|
|
|
|
|
|
$
|
(13,758
|
)
|
|
|
Three months ended June 30, 2018
|
|
Three months ended June 30, 2017
|
||||||||||||||||||||
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
||||||||||||
Stock-based compensation
|
|
$
|
768
|
|
|
$
|
83
|
|
|
$
|
851
|
|
|
$
|
434
|
|
|
$
|
47
|
|
|
$
|
481
|
|
|
|
Six months ended June 30, 2018
|
|
Six months ended June 30, 2017
|
||||||||||||||||||||
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
||||||||||||
Stock-based compensation
|
|
$
|
1,326
|
|
|
$
|
146
|
|
|
$
|
1,472
|
|
|
$
|
789
|
|
|
$
|
100
|
|
|
$
|
889
|
|
|
Percentage of Total Revenues for the
|
||||||
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Customer A
|
27%
|
|
45%
|
|
38%
|
|
42%
|
Customer B
|
34%
|
|
21%
|
|
22%
|
|
12%
|
Customer C
|
18%
|
|
*
|
|
21%
|
|
*
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
Americas
|
$
|
6,058
|
|
|
$
|
4,401
|
|
|
$
|
9,655
|
|
|
$
|
6,189
|
|
EMEA
|
3,808
|
|
|
1,959
|
|
|
8,800
|
|
|
5,166
|
|
||||
APAC
|
3,672
|
|
|
3,987
|
|
|
9,125
|
|
|
6,962
|
|
||||
Total revenues
|
$
|
13,538
|
|
|
$
|
10,347
|
|
|
$
|
27,580
|
|
|
$
|
18,317
|
|
Long-lived assets:
|
June 30, 2018
|
|
December 31, 2017
|
||
United States
|
100
|
%
|
|
100
|
%
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
Three months ended June 30,
|
|
Change
|
|
Six months ended June 30,
|
|
Change
|
||||||||||||||||||||
|
2018
|
|
2017
|
|
$
|
|
%
|
|
2018
|
|
2017
|
|
$
|
|
%
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Product revenue
|
$
|
3,723
|
|
|
$
|
6,600
|
|
|
$
|
(2,877
|
)
|
|
(44)%
|
|
$
|
9,886
|
|
|
$
|
12,186
|
|
|
$
|
(2,300
|
)
|
|
(19)%
|
Research and development revenue
|
9,815
|
|
|
3,747
|
|
|
6,068
|
|
|
162%
|
|
17,694
|
|
|
6,131
|
|
|
11,563
|
|
|
189%
|
||||||
Total revenues
|
13,538
|
|
|
10,347
|
|
|
3,191
|
|
|
31%
|
|
27,580
|
|
|
18,317
|
|
|
9,263
|
|
|
51%
|
||||||
Costs and operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of product revenue
|
2,611
|
|
|
3,790
|
|
|
(1,179
|
)
|
|
(31)%
|
|
6,436
|
|
|
6,792
|
|
|
(356
|
)
|
|
(5)%
|
||||||
Research and development
|
7,370
|
|
|
6,348
|
|
|
1,022
|
|
|
16%
|
|
14,548
|
|
|
12,187
|
|
|
2,361
|
|
|
19%
|
||||||
Selling, general and administrative
|
7,395
|
|
|
6,546
|
|
|
849
|
|
|
13%
|
|
15,141
|
|
|
13,152
|
|
|
1,989
|
|
|
15%
|
||||||
Total costs and operating expenses
|
17,376
|
|
|
16,684
|
|
|
692
|
|
|
4%
|
|
36,125
|
|
|
32,131
|
|
|
3,994
|
|
|
12%
|
||||||
Loss from operations
|
(3,838
|
)
|
|
(6,337
|
)
|
|
2,499
|
|
|
39%
|
|
(8,545
|
)
|
|
(13,814
|
)
|
|
5,269
|
|
|
38%
|
||||||
Interest income
|
174
|
|
|
49
|
|
|
125
|
|
|
255%
|
|
245
|
|
|
68
|
|
|
177
|
|
|
260%
|
||||||
Other expenses, net
|
(82
|
)
|
|
(34
|
)
|
|
(48
|
)
|
|
(141)%
|
|
(142
|
)
|
|
(12
|
)
|
|
(130
|
)
|
|
(1,083)%
|
||||||
Loss before income taxes
|
(3,746
|
)
|
|
(6,322
|
)
|
|
2,576
|
|
|
41%
|
|
(8,442
|
)
|
|
(13,758
|
)
|
|
5,316
|
|
|
39%
|
||||||
Benefit from income taxes
|
(11
|
)
|
|
(42
|
)
|
|
31
|
|
|
74%
|
|
(13
|
)
|
|
(18
|
)
|
|
5
|
|
|
28%
|
||||||
Net loss
|
$
|
(3,735
|
)
|
|
$
|
(6,280
|
)
|
|
$
|
2,545
|
|
|
41%
|
|
$
|
(8,429
|
)
|
|
$
|
(13,740
|
)
|
|
$
|
5,311
|
|
|
39%
|
•
|
Product revenue consist of sales of protein catalysts, pharmaceutical intermediates, and Codex
®
Biocatalyst Panels and Kits.
|
•
|
Research and development revenue include license, technology access and exclusivity fees, research services fees, milestone payments, royalties, optimization and screening fees, and revenue sharing arrangement revenues based upon sales of licensed products by Exela.
|
|
Three months ended June 30,
|
|
Change
|
|
Six months ended June 30,
|
|
Change
|
||||||||||||||||||||
(In Thousands)
|
2018
|
|
2017
|
|
$
|
|
%
|
|
2018
|
|
2017
|
|
$
|
|
%
|
||||||||||||
Product revenue
|
$
|
3,723
|
|
|
$
|
6,600
|
|
|
$
|
(2,877
|
)
|
|
(44)%
|
|
$
|
9,886
|
|
|
$
|
12,186
|
|
|
$
|
(2,300
|
)
|
|
(19)%
|
Research and development revenue
|
9,815
|
|
|
3,747
|
|
|
6,068
|
|
|
162%
|
|
17,694
|
|
|
6,131
|
|
|
11,563
|
|
|
189%
|
||||||
Total revenues
|
$
|
13,538
|
|
|
$
|
10,347
|
|
|
$
|
3,191
|
|
|
31%
|
|
$
|
27,580
|
|
|
$
|
18,317
|
|
|
$
|
9,263
|
|
|
51%
|
|
Three months ended June 30,
|
|
Change
|
|
Six months ended June 30,
|
|
Change
|
||||||||||||||||||||
(In Thousands)
|
2018
|
|
2017
|
|
$
|
|
%
|
|
2018
|
|
2017
|
|
$
|
|
%
|
||||||||||||
Cost of product revenue
|
$
|
2,611
|
|
|
$
|
3,790
|
|
|
$
|
(1,179
|
)
|
|
(31)%
|
|
$
|
6,436
|
|
|
$
|
6,792
|
|
|
$
|
(356
|
)
|
|
(5)%
|
Research and development
|
7,370
|
|
|
6,348
|
|
|
1,022
|
|
|
16%
|
|
14,548
|
|
|
12,187
|
|
|
2,361
|
|
|
19%
|
||||||
Selling, general and administrative
|
7,395
|
|
|
6,546
|
|
|
849
|
|
|
13%
|
|
15,141
|
|
|
13,152
|
|
|
1,989
|
|
|
15%
|
||||||
Total costs and operating expenses
|
$
|
17,376
|
|
|
$
|
16,684
|
|
|
$
|
692
|
|
|
4%
|
|
$
|
36,125
|
|
|
$
|
32,131
|
|
|
$
|
3,994
|
|
|
12%
|
|
Three months ended June 30,
|
|
Change
|
|
Six months ended June 30,
|
|
Change
|
||||||||||||||||||||
(In Thousands)
|
2018
|
|
2017
|
|
$
|
|
%
|
|
2018
|
|
2017
|
|
$
|
|
%
|
||||||||||||
Product revenue
|
$
|
3,723
|
|
|
$
|
6,600
|
|
|
$
|
(2,877
|
)
|
|
(44)%
|
|
$
|
9,886
|
|
|
$
|
12,186
|
|
|
$
|
(2,300
|
)
|
|
(19)%
|
Cost of product revenue
|
2,611
|
|
|
3,790
|
|
|
(1,179
|
)
|
|
(31)%
|
|
6,436
|
|
|
6,792
|
|
|
(356
|
)
|
|
(5)%
|
||||||
Product gross profit
|
$
|
1,112
|
|
|
$
|
2,810
|
|
|
$
|
(1,698
|
)
|
|
(60)%
|
|
$
|
3,450
|
|
|
$
|
5,394
|
|
|
$
|
(1,944
|
)
|
|
(36)%
|
Product gross margin (%)
|
30%
|
|
43%
|
|
|
|
|
|
35%
|
|
44%
|
|
|
|
|
|
|
Three months ended June 30,
|
|
Change
|
|
Six months ended June 30,
|
|
Change
|
||||||||||||||||||||
(In Thousands)
|
2018
|
|
2017
|
|
$
|
|
%
|
|
2018
|
|
2017
|
|
$
|
|
%
|
||||||||||||
Interest income
|
$
|
174
|
|
|
$
|
49
|
|
|
$
|
125
|
|
|
255%
|
|
$
|
245
|
|
|
$
|
68
|
|
|
$
|
177
|
|
|
260%
|
Other expense, net
|
(82
|
)
|
|
(34
|
)
|
|
(48
|
)
|
|
(141)%
|
|
(142
|
)
|
|
(12
|
)
|
|
(130
|
)
|
|
(1,083)%
|
||||||
Total other income
|
$
|
92
|
|
|
$
|
15
|
|
|
$
|
77
|
|
|
513%
|
|
$
|
103
|
|
|
$
|
56
|
|
|
$
|
47
|
|
|
84%
|
|
Three months ended June 30,
|
|
Change
|
||||||||||||||||||||||||||||||||||
|
2018
|
|
2017
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
||||||||||||||||||||||||||||||
(In Thousands)
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||||||||
Product revenue
|
$
|
3,723
|
|
|
$
|
—
|
|
|
$
|
3,723
|
|
|
$
|
6,600
|
|
|
$
|
—
|
|
|
$
|
6,600
|
|
|
$
|
(2,877
|
)
|
|
(44
|
)%
|
|
$
|
—
|
|
|
—
|
%
|
Research and development revenue
|
7,442
|
|
|
2,373
|
|
|
9,815
|
|
|
3,747
|
|
|
—
|
|
|
3,747
|
|
|
3,695
|
|
|
99
|
%
|
|
2,373
|
|
|
100
|
%
|
||||||||
Total revenues
|
$
|
11,165
|
|
|
$
|
2,373
|
|
|
$
|
13,538
|
|
|
$
|
10,347
|
|
|
$
|
—
|
|
|
$
|
10,347
|
|
|
$
|
818
|
|
|
8
|
%
|
|
$
|
2,373
|
|
|
100
|
%
|
|
Six months ended June 30,
|
|
Change
|
||||||||||||||||||||||||||||||||||
|
2018
|
|
2017
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
||||||||||||||||||||||||||||||
(In Thousands)
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||||||||
Product revenue
|
$
|
9,886
|
|
|
$
|
—
|
|
|
$
|
9,886
|
|
|
$
|
12,186
|
|
|
—
|
|
|
$
|
12,186
|
|
|
$
|
(2,300
|
)
|
|
(19
|
)%
|
|
$
|
—
|
|
|
—
|
%
|
|
Research and development revenue
|
12,008
|
|
|
5,686
|
|
|
17,694
|
|
|
6,131
|
|
|
$
|
—
|
|
|
6,131
|
|
|
5,877
|
|
|
96
|
%
|
|
5,686
|
|
|
100
|
%
|
|||||||
Total revenues
|
$
|
21,894
|
|
|
$
|
5,686
|
|
|
$
|
27,580
|
|
|
$
|
18,317
|
|
|
$
|
—
|
|
|
$
|
18,317
|
|
|
$
|
3,577
|
|
|
20
|
%
|
|
$
|
5,686
|
|
|
100
|
%
|
|
Three months ended June 30,
|
|
Change
|
||||||||||||||||||||||||||||||||||
|
2018
|
|
2017
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
||||||||||||||||||||||||||||||
(In Thousands)
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||||||||
Cost of product revenue
|
$
|
2,611
|
|
|
$
|
—
|
|
|
$
|
2,611
|
|
|
$
|
3,790
|
|
|
—
|
|
|
$
|
3,790
|
|
|
$
|
(1,179
|
)
|
|
(31
|
)%
|
|
$
|
—
|
|
|
—
|
%
|
|
Research and development
|
4,724
|
|
|
2,442
|
|
|
7,166
|
|
|
4,023
|
|
|
$
|
2,149
|
|
|
6,172
|
|
|
701
|
|
|
17
|
%
|
|
293
|
|
|
14
|
%
|
|||||||
Selling, general and administrative
|
1,729
|
|
|
304
|
|
|
2,033
|
|
|
1,777
|
|
|
$
|
—
|
|
|
1,777
|
|
|
(48
|
)
|
|
(3
|
)%
|
|
304
|
|
|
100
|
%
|
|||||||
Total segment costs and operating expenses
|
$
|
9,064
|
|
|
$
|
2,746
|
|
|
11,810
|
|
|
$
|
9,590
|
|
|
$
|
2,149
|
|
|
11,739
|
|
|
$
|
(526
|
)
|
|
(5
|
)%
|
|
$
|
597
|
|
|
28
|
%
|
||
Corporate costs
|
|
|
|
|
5,301
|
|
|
|
|
|
|
4,717
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Depreciation and amortization
|
|
|
|
|
265
|
|
|
|
|
|
|
228
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Total costs and operating expenses
|
|
|
|
|
$
|
17,376
|
|
|
|
|
|
|
$
|
16,684
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30,
|
|
Change
|
||||||||||||||||||||||||||||||||||
|
2018
|
|
2017
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
||||||||||||||||||||||||||||||
(In Thousands)
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
Performance Enzymes
|
|
Novel Biotherapeutics
|
|
Total
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||||||||
Cost of product revenue
|
$
|
6,436
|
|
|
$
|
—
|
|
|
$
|
6,436
|
|
|
$
|
6,792
|
|
|
$
|
—
|
|
|
$
|
6,792
|
|
|
$
|
(356
|
)
|
|
(5
|
)%
|
|
$
|
—
|
|
|
—
|
%
|
Research and development
|
9,790
|
|
|
4,374
|
|
|
14,164
|
|
|
8,172
|
|
|
3,660
|
|
|
11,832
|
|
|
1,618
|
|
|
20
|
%
|
|
714
|
|
|
20
|
%
|
||||||||
Selling, general and administrative
|
3,825
|
|
|
450
|
|
|
4,275
|
|
|
3,589
|
|
|
—
|
|
|
3,589
|
|
|
236
|
|
|
7
|
%
|
|
450
|
|
|
100
|
%
|
||||||||
Total segment costs and operating expenses
|
$
|
20,051
|
|
|
$
|
4,824
|
|
|
24,875
|
|
|
$
|
18,553
|
|
|
$
|
3,660
|
|
|
22,213
|
|
|
$
|
1,498
|
|
|
8
|
%
|
|
$
|
1,164
|
|
|
32
|
%
|
||
Corporate costs
|
|
|
|
|
10,747
|
|
|
|
|
|
|
9,364
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Depreciation and amortization
|
|
|
|
|
503
|
|
|
|
|
|
|
554
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Total costs and operating expenses
|
|
|
|
|
$
|
36,125
|
|
|
|
|
|
|
$
|
32,131
|
|
|
|
|
|
|
|
|
|
(In Thousands)
|
June 30, 2018
|
|
December 31, 2017
|
||||
Cash and cash equivalents
|
$
|
53,621
|
|
|
$
|
31,219
|
|
Working capital
|
$
|
49,873
|
|
|
$
|
20,087
|
|
|
Six months ended June 30,
|
||||||
(In Thousands)
|
2018
|
|
2017
|
||||
Net cash used in operating activities
|
$
|
(12,141
|
)
|
|
$
|
(11,531
|
)
|
Net cash used in investing activities
|
(1,472
|
)
|
|
(677
|
)
|
||
Net cash provided by financing activities
|
35,918
|
|
|
21,737
|
|
||
Net increase in cash, cash equivalents and restricted cash
|
$
|
22,305
|
|
|
$
|
9,529
|
|
|
|
|
Payments due by period
|
||||||||||||||
(In Thousands)
|
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
4-5 years
|
|||||||||
Capital lease obligations
|
|
$
|
439
|
|
|
$
|
126
|
|
|
$
|
313
|
|
|
$
|
—
|
|
|
Operating leases obligations
(1)
|
|
6,121
|
|
|
1,598
|
|
|
4,482
|
|
|
41
|
|
|||||
|
Total
|
|
$
|
6,560
|
|
|
$
|
1,724
|
|
|
$
|
4,795
|
|
|
$
|
41
|
|
(1)
|
Represents future minimum lease payments under non-cancellable operating leases in effect as of
June 30, 2018
for our facilities in Redwood City, California. The minimum lease payments above do not include common area maintenance charges or real estate taxes. In addition, amounts have not been reduced by future minimum sublease rentals of
$0.9 million
to be received under non-cancellable subleases.
|
Other Commitment Agreement Type
|
|
Agreement Date
|
|
Future Minimum Payment
|
||
Manufacture and supply agreement with expected future payment date of December 2022
|
|
April 2016
|
|
$
|
1,693
|
|
Service agreement for the development of manufacturing process
|
|
April 2017
|
|
2
|
|
|
Service agreement for stability study
|
|
July 2017
|
|
439
|
|
|
Service agreement for clinical trial
|
|
December 2017
|
|
$
|
2,116
|
|
Total other commitments
|
|
|
|
$
|
4,250
|
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
ITEM 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS
|
3.1
|
|
|
|
|
|
|
|
3.2
|
|
|
|
|
|
|
|
3.3
|
|
|
|
|
|
|
|
4.1
|
|
|
Reference is made to Exhibits 3.1 through 3.3.
|
|
|
|
|
4.2
|
|
|
|
|
|
|
|
10.1
|
|
|
|
|
|
|
|
31.1
|
|
|
|
|
|
|
|
31.2
|
|
|
|
|
|
|
|
32.1
|
|
|
|
|
|
|
|
101
|
|
|
The following materials from the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2018, formatted in Extensible Business Reporting Language (XBRL) includes: (i) Unaudited Condensed Consolidated Balance Sheets at June 30, 2018 and December 31, 2017, (ii) Unaudited Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2018 and 2017, (iii) Unaudited Condensed Consolidated Statements of Comprehensive Loss for the Three and Six Months Ended June 30, 2018 and 2017, (iv) Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2018 and 2017, and (v) Notes to Unaudited Condensed Consolidated Financial Statements.
|
|
|
|
|
|
|
Codexis, Inc.
|
|
|
|
|
|
Date:
|
August 9, 2018
|
By:
|
/s/ John J. Nicols
|
|
|
|
John J. Nicols
President and Chief Executive Officer
(principal executive officer)
|
|
|
|
|
Date:
|
August 9, 2018
|
By:
|
/s/ Gordon Sangster
|
|
|
|
Gordon Sangster
Chief Financial Officer
(principal financial and accounting officer)
|
1.
|
Capitalized terms used herein but not otherwise defined shall have the respective meanings given to them in the Loan Agreement.
|
2.
|
Section 1.1 of the Loan Agreement is hereby amended by amending and restating the following definition therein as follows:
|
a.
|
The amendments set forth above are effective for the purposes set forth herein and shall be limited precisely as written and shall not be deemed to (a) be a consent to any amendment, waiver or modification of any other term or condition of any Loan Document, or (b) otherwise prejudice any right, remedy or obligation which the Bank or Borrower may now have or may have in the future under or in connection with any Loan Document, as amended hereby.
|
b.
|
This Amendment shall be construed in connection with and as part of the Loan Documents and all terms, conditions, representations, warranties, covenants and agreements set forth in the Loan Documents, except as herein amended, are hereby ratified and confirmed and shall remain in full force and effect.
|
4.
|
To induce the Bank to enter into this Amendment, Borrower hereby represents and warrants to the Bank as follows:
|
a.
|
Immediately after giving effect to this Amendment (a) the representations and warranties contained in Article 5 of the Loan Agreement are true, accurate and complete in all material respects as of the date hereof (except to the extent such representations and warranties relate to an earlier date, in which case they are true and correct in all material respects as of such date), and (b) no Event of Default has occurred and is continuing;
|
b.
|
Borrower has the power and due authority to execute and deliver this Amendment and to perform its obligations under the Loan Agreement, as amended by this Amendment;
|
c.
|
The organizational documents of Borrower delivered to the Bank on the Closing Date, and updated pursuant to subsequent deliveries by the Borrower to the Bank, if any, remain true, accurate and complete and have not been amended, supplemented or restated and are and continue to be in full force and effect;
|
d.
|
The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Amendment, do not and will not contravene (i) any law or regulation binding on or affecting Borrower, (ii) any contractual restriction with a Person binding on Borrower, (iii) any order, judgment or decree of any court or other governmental or public body or authority, or subdivision thereof, binding on Borrower, or (iv) the organizational documents of Borrower;
|
e.
|
The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Amendment, do not require any order, consent, approval, license, authorization or validation of, or filing, recording or registration by Borrower with, or exemption by any governmental or public body or authority, or subdivision thereof, binding on Borrower, except as already has been obtained or made; and
|
f.
|
This Amendment has been duly executed and delivered by Borrower and is the binding obligation of Borrower, enforceable against Borrower in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, liquidation, moratorium or other similar laws of general application and by general equitable principles.
|
5.
|
Except as expressly set forth herein, the Loan Agreement shall continue in full force and effect without alteration or amendment. This Amendment and the Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements.
|
6.
|
This Amendment shall be deemed effective as of the Amendment Date upon the due execution and delivery to the Bank of this Amendment by each party hereto.
|
7.
|
This Amendment may be executed in any number of counterparts, each of which shall be deemed an original, and all of which, taken together, shall constitute one and the same instrument.
|
8.
|
This Amendment and the rights and obligations of the parties hereto shall be governed by and construed in accordance with the laws of the State of California.
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Codexis, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ John J. Nicols
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John J. Nicols
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President and Chief Executive Officer
(principal executive officer)
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1.
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I have reviewed this Quarterly Report on Form 10-Q of Codexis, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Gordon Sangster
|
Gordon Sangster
Senior Vice President and Chief Financial Officer
|
(principal financial and accounting officer)
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•
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
•
|
The information in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ John J. Nicols
|
John J. Nicols
|
President and Chief Executive Officer
(principal executive officer)
|
|
/s/ Gordon Sangster
|
Gordon Sangster
Senior Vice President and Chief Financial Officer |
(principal financial and accounting officer)
|