0001193125-21-028775 | 10-Q | XBRL Viewer

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Cover Page - shares	6 Months Ended
Cover Page - shares	Dec. 31, 2020	Feb. 02, 2021
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Dec. 31, 2020
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2
Trading Symbol	MEIP
Entity Registrant Name	MEI Pharma, Inc.
Entity Central Index Key	0001262104
Current Fiscal Year End Date	--06-30
Entity Filer Category	Non-accelerated Filer
Entity Current Reporting Status	Yes
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Small Business	true
Title of 12(b) Security	Common Stock
Security Exchange Name	NASDAQ
Entity Address, State or Province	CA
Entity Interactive Data Current	Yes
Entity Common Stock, Shares Outstanding		112,527,860

CONDENSED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020
Current assets:
Cash and cash equivalents	$ 9,877	$ 12,331
Short-term investments	170,267	170,299
Total cash, cash equivalents and short-term investments	180,144	182,630
Receivable for foreign tax withholding		20,420
Prepaid expenses and other current assets	13,888	5,594
Total current assets	194,032	208,644
Operating lease right-of-use asset	8,207
Property and equipment, net	1,641	1,084
Total assets	203,880	209,728
Current liabilities:
Accounts payable	5,555	2,437
Accrued liabilities	11,102	6,090
Deferred revenue	19,482	14,777
Operating lease liability	873
Total current liabilities	37,012	23,304
Deferred revenue, long-term	65,352	67,723
Operating lease liability, long-term	7,842
Warrant liability	20,176	40,483
Total liabilities	130,382	131,510
Commitments and contingencies (Note 6)
Stockholders' equity:
Preferred stock, $0.01 par value; 100 shares authorized; none outstanding
Common stock, $0.00000002 par value; 226,000 shares authorized; 112,528 and 111,514 shares issued and outstanding at December 31, 2020 and June 30, 2020, respectively
Additional paid-in capital	364,278	355,452
Accumulated deficit	(290,780)	(277,234)
Total stockholders' equity	73,498	78,218
Total liabilities and stockholders' equity	$ 203,880	$ 209,728

CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands	Dec. 31, 2020	Jun. 30, 2020
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	100	100
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.00000002	$ 0.00000002
Common stock, shares authorized	226,000	226,000
Common stock, shares issued	112,528	111,514
Common stock, shares outstanding	112,528	111,514

CONDENSED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Revenue	$ 9,167	$ 1,008	$ 13,001	$ 2,165
Operating expenses:
Cost of revenue	494	641	1,003	1,329
Research and development	22,224	8,281	35,220	17,243
General and administrative	5,650	4,195	11,565	8,325
Total operating expenses	28,368	13,117	47,788	26,897
Loss from operations	(19,201)	(12,109)	(34,787)	(24,732)
Other income (expense):
Change in fair value of warrant liability	7,083	(8,439)	20,307	830
Interest and dividend income	164	318	439	692
Other income (expense)	500	13	495	(1)
Net loss	(11,454)	(20,217)	(13,546)	(23,211)
Net loss:
Basic	(11,454)	(20,217)	(13,546)	(23,211)
Diluted	$ (18,537)	$ (20,217)	$ (33,853)	$ (23,211)
Net loss per share:
Basic	$ (0.10)	$ (0.26)	$ (0.12)	$ (0.30)
Diluted	$ (0.16)	$ (0.26)	$ (0.30)	$ (0.30)
Shares used in computing net loss per share:
Basic	112,524	78,577	112,480	76,103
Diluted	114,461	78,577	114,709	76,103

CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Common Shares	Additional paid in capital	Accumulated Deficit
Beginning Balance at Jun. 30, 2019	$ 47,930	$ 73,545	$ 279,148	$ (231,218)
Net loss	(2,994)			(2,994)
Issuance of common stock	159	64	159
Exercise of stock options	72	46	72
Share-based compensation expense	2,113		2,113
Ending Balance at Sep. 30, 2019	47,280	73,655	281,492	(234,212)
Beginning Balance at Jun. 30, 2019	47,930	73,545	279,148	(231,218)
Net loss	(23,211)
Ending Balance at Dec. 31, 2019	77,285	105,999	331,714	(254,429)
Beginning Balance at Sep. 30, 2019	47,280	73,655	281,492	(234,212)
Net loss	(20,217)			(20,217)
Issuance of common stock	48,451	32,344	48,451
Share-based compensation expense	1,771		1,771
Ending Balance at Dec. 31, 2019	77,285	105,999	331,714	(254,429)
Beginning Balance at Jun. 30, 2020	78,218	111,514	355,452	(277,234)
Net loss	(2,092)			(2,092)
Issuance of common stock	3,136	958	3,136
Exercise of stock options	124	50	124
Share-based compensation expense	2,942		2,942
Ending Balance at Sep. 30, 2020	82,328	112,522	361,654	(279,326)
Beginning Balance at Jun. 30, 2020	78,218	111,514	355,452	(277,234)
Net loss	(13,546)
Ending Balance at Dec. 31, 2020	73,498	112,528	364,278	(290,780)
Beginning Balance at Sep. 30, 2020	82,328	112,522	361,654	(279,326)
Net loss	(11,454)			(11,454)
Exercise of stock options	15	6	15
Share-based compensation expense	2,609		2,609
Ending Balance at Dec. 31, 2020	$ 73,498	$ 112,528	$ 364,278	$ (290,780)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

- Definition

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

+ References + Details

CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Cash flows from operating activities:
Net loss	$ (13,546)	$ (23,211)
Adjustments to reconcile net loss to net cash used in operating activities:
Change in fair value of warrant liability	(20,307)	(830)
Share-based compensation	5,551	3,884
Depreciation and amortization	143	60
Non-cash lease expense	482
Changes in operating assets and liabilities:
Receivable for foreign tax withholding	20,420
Prepaid expenses and other current assets	(8,294)	(129)
Accounts payable	3,118	(1,749)
Accrued liabilities	5,012	(974)
Deferred revenue	2,334	(1,610)
Operating lease liability	26
Net cash used in operating activities	(5,061)	(24,559)
Cash flows from investing activities:
Purchases of property and equipment	(700)	(5)
Purchases of short-term investments	(215,176)	(70,199)
Proceeds from maturity of short-term investments	215,208	39,855
Net cash used in investing activities	(668)	(30,349)
Cash flows from financing activities:
Proceeds from exercise of stock options	139	72
Proceeds from issuance of common stock, net	3,136	48,610
Collection of common stock proceeds receivable		5,274
Net cash provided by financing activities	3,275	53,956
Net decrease in cash and cash equivalents	(2,454)	(952)
Cash and cash equivalents at beginning of the period	12,331	9,590
Cash and cash equivalents at end of the period	9,877	8,638
Supplemental disclosures:
Income taxes paid	(8)	$ (1)
Operating lease right-of-use assets obtained in exchange for operating lease liabilities	$ 8,689

The Company and Summary of Significant Accounting Policies

6 Months Ended

Dec. 31, 2020

The Company and Summary of Significant Accounting Policies

Note 1. The Company and Summary of Significant Accounting Policies

The Company

We are a late-stage pharmaceutical company focused on leveraging our extensive development and oncology expertise to identify and advance new therapies intended to meaningfully improve the treatment of cancer. Our portfolio of drug candidates contains four clinical-stage assets, including zandelisib (formerly known as

ME-401),

currently in an ongoing Phase 2 clinical trial that we intend to submit to the U.S. Food and Drug Administration (“FDA”) to support accelerated approval of a marketing application. Our common stock is listed on the NASDAQ Capital Market under the symbol “MEIP”.

Clinical Development Programs

Our approach to building our pipeline is to license promising cancer agents and build value in programs through development, commercialization and strategic partnerships, as appropriate. Our drug candidate pipeline includes:

•

Zandelisib (formerly known as

ME-401),

an oral phosphatidylinositol

3-kinase

(“PI3K”) delta inhibitor;

•

Voruciclib, an oral cyclin-dependent kinase (“CDK”) inhibitor;

•

ME-344,

a mitochondrial inhibitor targeting the oxidative phosphorylation (“OXPHOS”) complex; and

•

Pracinostat, an oral histone deacetylase (“HDAC”) inhibitor.

The results of

pre-clinical

studies and completed clinical trials are not necessarily predictive of future results, and our current drug candidates may not have favorable results in later studies or trials. The commercial opportunity will be reduced or eliminated if competitors develop and market products that are more effective, have fewer side effects or are less expensive than our drug candidates. We will need substantial additional funds to progress the clinical trial programs for the drug candidates zandelisib, voruciclib and

ME-344,

and to develop new compounds. The actual amount of funds that will be needed will depend upon a number of factors, some of which are beyond our control. Negative U.S. and global economic conditions may pose challenges to our business strategy, which relies on funding from the financial markets or collaborators.

Liquidity

We have accumulated losses of $290.8 million since inception and expect to incur operating losses and generate negative cash flows from operations for the foreseeable future. As of December 31, 2020, we had $180.1 million in cash and cash equivalents and short-term investments. We believe that these resources will be sufficient to meet our obligations and fund our liquidity and capital expenditure requirements for at least the next 12 months from the issuance of these financial statements. Our current business operations are focused on continuing the clinical development of our drug candidates. Changes to our research and development plans or other changes affecting our operating expenses may affect actual future use of existing cash resources. Our research and development expenses are expected to increase in the foreseeable future. We cannot determine with certainty costs associated with ongoing and future clinical trials or the regulatory approval process. The duration, costs and timing associated with the development of our product candidates will depend on a variety of factors, including uncertainties associated with the results of our clinical trials.

To date, we have obtained cash and funded our operations primarily through equity financings and license agreements. In order to continue the development of our drug candidates, at some point in the future we expect to pursue one or more capital transactions, whether through the sale of equity securities, debt financing, license agreements or entry into strategic partnerships. There can be no assurance that we will be able to continue to raise additional capital in the future.

Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form

10-Q

and Article 10 of Regulation

S-X.

Accordingly, the accompanying financial statements do not include all of the information and notes required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying financial statements reflect all adjustments (consisting of normal recurring adjustments) that are necessary for a fair statement of the financial position, results of operations and cash flows for the periods presented. We have evaluated subsequent events through the date the financial statements were issued.

The accompanying unaudited financial statements should be read in conjunction with the audited financial statements and notes thereto as of and for the fiscal year ended June 30, 2020, included in our Annual Report on Form

10-K

(“2020 Annual Report”) filed with the Securities and Exchange Commission on September 9, 2020. Interim results are not necessarily indicative of results for a full year.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and disclosures made in the accompanying notes to the financial statements. We use estimates that affect the reported amounts (including assets, liabilities, revenues and expenses) and related disclosures. Actual results could materially differ from those estimates.

Revenue Recognition

ASC Topic 606, Revenue from Contracts with Customers (“Topic 606”)

We recognize revenue when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. For enforceable contracts with our customers, we first identify the distinct performance obligations – or accounting units – within the contract. Performance obligations are commitments in a contract to transfer a distinct good or service to the customer.

Payments received under commercial arrangements, such as licensing technology rights, may include

non-refundable

fees at the inception of the arrangements, milestone payments for specific achievements designated in the agreements, and royalties on the sale of products. At the inception of arrangements that include milestone payments, we use judgment to evaluate whether the milestones are probable of being achieved and we estimate the amount to include in the transaction price using the most likely method. If it is probable that a significant revenue reversal will not occur, the estimated amount is included in the transaction price. Milestone payments that are not within our or the licensee’s control, such as regulatory approvals, are not included in the transaction price until those approvals are received. At the end of each reporting period, we

re-evaluate

the probability of achievement of development milestones and any related constraint and, as necessary, we adjust our estimate of the overall transaction price. Any adjustments are recorded on a cumulative

catch-up

basis, which would affect revenues and earnings in the period of adjustment.

We develop estimates of the stand-alone selling price for each distinct performance obligation. Variable consideration that relates specifically to our efforts to satisfy specific performance obligations is allocated entirely to those performance obligations. Other components of the transaction price are allocated based on the relative stand-alone selling price, over which management has applied significant judgment. We develop assumptions that require judgment to determine the stand-alone selling price for license-related performance obligations, which may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical, regulatory and commercial success. We estimate stand-alone selling price for research and development performance obligations by forecasting the expected costs of satisfying a performance obligation plus an appropriate margin.

In the case of a license that is a distinct performance obligation, we recognize revenue allocated to the license from

non-refundable,

up-front

fees at the point in time when the license is transferred to the licensee and the licensee can use and benefit from the license. For licenses that are bundled with other distinct or combined obligations, we use judgment to assess the nature of the performance obligation to determine whether the performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. If the performance obligation is satisfied over time, we evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition.

The selection of the method to measure progress towards completion requires judgment and is based on the nature of the products or services to be provided. Revenue is recorded proportionally as costs are incurred. We generally use the

cost-to-cost

measure of progress because it best depicts the transfer of control to the customer which occurs as we incur costs. Under the

cost-to-cost

measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation (an “input method” under Topic 606). We use judgment to estimate the total cost expected to complete the research and development performance obligations, which include subcontractors’ costs, labor, materials, other direct costs and an allocation of indirect costs. We evaluate these cost estimates and the progress each reporting period and, as necessary, we adjust the measure of progress and related revenue recognition.

For arrangements that include sales-based or usage-based royalties, we recognize revenue at the later of (i) when the related sales occur or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied or partially satisfied. To date, we have not recognized any sales-based or usage-based royalty revenue from license agreements.

We recognized revenue associated with the following license agreements (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
KKC License Agreements	$	9,090	$	673	$	12,658	$	1,470
Helsinn License Agreement		77		335		343		695

	$	9,167	$	1,008	$	13,001	$	2,165

Timing of Revenue Recognition:
Services performed over time	$	9,167	$	1,008	$	13,001	$	2,165

	$	9,167	$	1,008	$	13,001	$	2,165

The KKC Commercialization Agreement and KKC Japan License Agreement (Note 3) include other distinct performance obligations that will be satisfied over time, and accordingly we recognized $9.1 million and $0.7 million related to our progress toward satisfying those obligations during the three months ended December 31, 2020 and 2019, respectively, and $12.7 million and $1.5 million during the six months ended December 31, 2020 and 2019, respectively.

Based on the characteristics of the Helsinn License Agreement (Note 3), control of the remaining deliverables occurs over time and therefore we recognize revenue based on the extent of progress towards completion of the performance obligations. Accordingly, we recognized $0.1 million and $0.3 million related to our progress toward satisfying those obligations during the three months ended December 31, 2020 and 2019, respectively, and $0.3 million and $0.7 million during the six months ended December 31, 2020 and 2019, respectively.

Contract Balances

Receivables and contract assets are included in our balance sheet in “Prepaid expenses and other current assets”, and contract liabilities are included in “Deferred revenue” and “Deferred revenue, long-term”. The following table presents changes in contract assets and contract liabilities during the six months ended December 31, 2020 and 2019 (in thousands):


	Six Months Ended December 31,
	2020			2019
Receivables
Receivables, beginning of period	$	2,605		$	—
Net change		(2,205	)		96

Receivables, end of period	$	400		$	96

Contract assets
Contract assets, beginning of period	$	604		$	686
Net change		9,602			(205	)

Contract assets, end of period	$	10,206		$	481

Contract liabilities
Contract liabilities, beginning of period	$	82,500		$	7,774
Net change		2,334			(1,610	)

Contract liabilities, end of period	$	84,834		$	6,164

The timing of revenue recognition, invoicing and cash collections results in billed accounts receivable and unbilled receivables (contract assets), which are classified as “prepaid expenses and other current assets” on our Condensed Balance Sheet, and deferred revenue (contract liabilities). We invoice our customers in accordance with agreed-upon contractual terms, typically at periodic intervals or upon achievement of contractual milestones. Invoicing may occur subsequent to revenue recognition, resulting in contract assets. We may receive advance payments from our customers before revenue is recognized, resulting in contract liabilities. The contract assets and liabilities reported on the Condensed Balance Sheet relate to the KKC Agreements and Helsinn License Agreement.

As of December 31, 2020, we had $10.2 million of contract assets related to our remaining performance obligations under the KKC Commercialization Agreement and the Helsinn License Agreement. During the six months ended December 31, 2020, contract assets increased by $18.4 million, primarily due the recognition of revenue related to the satisfaction or partial satisfaction of performance obligations for which we had not yet billed the KKC or Helsinn, offset by billings of $8.8 million to KKC and Helsinn.

As of December 31, 2020, we had $84.8 million of deferred revenue associated with our remaining performance obligations under the KKC Commercialization Agreement, of which $64.5 million relates to the U.S. License which is a unit of account under the scope of Topic 808 and is not a deliverable under Topic 606, and $20.3 million relates to the

Ex-U.S.

license and development services performance obligations which are under the scope of Topic 606. For the three and six months ended December 31, 2020, we recognized revenue of $9.2 million and $12.7 million, respectively, that was included in the contract liabilities balance at June 30, 2020 related to performance obligations under ASC 606. To date we have not recognized any amounts related to units of account under Topic 808. For the three and six months ended December 31, 2019, we recognized revenue of $1.0 million and $1.8 million, respectively, that was included in the contract liabilities balance at June 30, 2019 related to performance obligations under ASC 606 under the KKC Japan License Agreement and Helsinn License Agreement which are described in Note 3.

Revenues from Collaborators

We earn revenue in connection with collaboration agreements, which are described in Note 3, License Agreements, and Note 4, BeiGene Collaboration.

At contract inception, we assess whether the collaboration arrangements are within the scope of ASC Topic 808,

Collaborative Arrangements

(“Topic 808”), to determine whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards dependent on the commercial success of such activities. This assessment is performed based on the responsibilities of all parties in the arrangement. For collaboration arrangements within the scope of Topic 808 that contain multiple units of account, we first determine which units of account within the arrangement are within the scope of Topic 808 and which elements are within the scope of Topic 606. For units of account within collaboration arrangements that are accounted for pursuant to Topic 808, an appropriate recognition method is determined and applied consistently, by analogy to authoritative accounting literature. For elements of collaboration arrangements that are accounted for pursuant to Topic 606, we recognize revenue as discussed above. Consideration received that does not meet the requirements to satisfy Topic 606 revenue recognition criteria is recorded as deferred revenue in the accompanying consolidated balance sheets, classified as either short-term or long-term deferred revenue based on our best estimate of when such amounts will be recognized.

Cost of Revenue

Cost of revenue primarily includes external costs paid to third-party contractors to perform research, conduct clinical trials and develop and manufacture drug materials, and internal compensation and related personnel expenses to support our research and development performance obligations associated with the Helsinn License Agreement.

Research and Development Costs

Research and development costs are expensed as incurred and include costs paid to third-party contractors to perform research, conduct clinical trials and develop and manufacture drug materials. Clinical trial costs, including costs associated with third-party contractors, are a significant component of research and development expenses. We expense research and development costs based on work performed. In determining the amount to expense, management relies on estimates of total costs based on contract components completed, the enrollment of subjects, the completion of trials, and other events. Costs incurred related to the purchase or licensing of

in-process

research and development for early-stage products or products that are not commercially viable and ready for use, or have no alternative future use, are charged to expense in the period incurred.

Share-based Compensation

Share-based compensation expense for employees and directors is recognized in the Condensed Statement of Operations based on estimated amounts, including the grant date fair value and the expected service period. For stock options, we estimate the grant date fair value using a Black-Scholes valuation model, which requires the use of multiple subjective inputs including estimated future volatility, expected forfeitures and the expected term of the awards. We estimate the expected future volatility based on the stock’s historical price volatility. The stock’s future volatility may differ from the estimated volatility at the grant date. For restricted stock unit (“RSU”) equity awards, we estimate the grant date fair value using our closing stock price on the date of grant. We recognize the effect of forfeitures in compensation expense when the forfeitures occur. The estimated forfeiture rates may differ from actual forfeiture rates which would affect the amount of expense recognized during the period. We recognize the value of the awards over the awards’ requisite service or performance periods. The requisite service period is generally the time over which our share-based awards vest.

Income Taxes

Our income tax expense consists of current and deferred income tax expense or benefit. Current income tax expense or benefit is the amount of income taxes expected to be payable or refundable for the current year. A deferred income tax asset or liability is recognized for the future tax consequences attributable to tax credits and loss carryforwards and to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. As of December 31, 2020 and 2019, we have established a valuation allowance to fully reserve our net deferred tax assets. Tax rate changes are reflected in income during the period such changes are enacted. Changes in our ownership may limit the amount of net operating loss carryforwards that can be utilized in the future to offset taxable income.

There have been no material changes in our unrecognized tax benefits since June 30, 2020, and, as such, the disclosures included in our 2020 Annual Report continue to be relevant for the six months ended December 31, 2020.

Leases

Effective July 1, 2019, we adopted FASB ASC Topic 842,

Leases

(“ASC 842”), using a modified retrospective basis method under which prior comparative periods are not restated. This standard requires lessees to recognize in the statement of financial position a liability to make lease payments and a

right-of-use

(“ROU”) asset representing our right to use the underlying asset for the lease term. At the inception of an arrangement, we determine whether the arrangement is or contains a lease based on the unique facts and circumstances within the arrangement. A lease is identified where an arrangement conveys the right to control the use of identified property, plant, and equipment for a period of time in exchange for consideration. Leases which are identified within the scope of ASC 842 and which have a term greater than one year are recognized on our Condensed Balance Sheet as ROU assets and lease liabilities. Operating lease liabilities and their corresponding ROU assets are recorded based on the present value of lease payments over the expected remaining lease term. The lease term includes any renewal options and termination options that we are reasonably certain to exercise. Certain adjustments to the

right-of-use

asset may be required for items such as initial direct costs paid or incentives received. The present value of lease payments is determined by using the interest rate implicit in the lease, if that rate is readily determinable; otherwise, we use our incremental borrowing rate. The incremental borrowing rate is determined based on the rate of interest that we would pay to borrow on a collateralized basis an amount equal to the lease payments for a similar term and in a similar economic environment. The interest rate implicit in lease contracts to calculate the present value is typically not readily determinable. As such, significant management judgment is required to estimate the incremental borrowing rate.

Rent expense for operating leases is recognized on a straight-line basis over the lease term based on the total lease payments. We have elected the practical expedient to not separate lease and

non-lease

components for our real estate leases. Our

non-lease

components are primarily related to property maintenance, which varies based on future outcomes, and thus is recognized in rent expense when incurred.

Fair Value Measurements

6 Months Ended

Dec. 31, 2020

Fair Value Measurements

Note 2. Fair Value Measurements

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value is as follows:


• Level 1 —		Observable inputs such as quoted prices in active markets for identical assets or liabilities.

• Level 2 —		Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

• 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.

We measure the following financial instruments at fair value on a recurring basis. The fair values of these financial instruments were as follows (in thousands):


	December 31, 2020							June 30, 2020
	Level 1		Level 2		Level 3			Level 1		Level 2		Level 3
Warrant liability	$	—	$	—	$	(20,176	)	$	—	$	—	$	(40,483	)

Total	$	—	$	—	$	(20,176	)	$	—	$	—	$	(40,483	)

The carrying amounts of financial instruments such as cash equivalents, short-term investments and accounts payable approximate the related fair values due to the short-term maturities of these instruments. We invest our excess cash in financial instruments which are readily convertible into cash, such as money market funds and U.S. government securities. Cash equivalents, where applicable, and short-term investments are classified as Level 1 as defined by the fair value hierarchy.

In May 2018, we issued warrants in connection with our private placement of shares of common stock. Pursuant to the terms of the warrants, we could be required to settle the warrants in cash in the event of an acquisition of the Company and, as a result, the warrants are required to be measured at fair value and reported as a liability in the Condensed Balance Sheet. We recorded the fair value of the warrants upon issuance using the Black-Scholes valuation model and are required to revalue the warrants at each reporting date with any changes in fair value recorded on our Condensed Statement of Operations. The valuation of the warrants is considered under Level 3 of the fair value hierarchy due to the need to use assumptions in the valuation that are both significant to the fair value measurement and unobservable. Inputs used to determine estimated fair value of the warrant liabilities include the estimated fair value of the underlying stock at the valuation date, the estimated term of the warrants, risk-free interest rates, expected dividends and the expected volatility of the underlying stock. The significant unobservable inputs used in the fair value measurement of the warrant liabilities were the volatility rate and the estimated term of the warrants. Generally, increases (decreases) in the fair value of the underlying stock and estimated term would result in a directionally similar impact to the fair value measurement. The change in the fair value of the Level 3 warrant liability is reflected in the Condensed Statement of Operations for the three and six months ended December 31, 2020 and 2019, respectively.

To calculate the fair value of the warrant liability, the following assumptions were used:


	December 31,			June 30,
	2020			2020
Risk-free interest rate		0.1	%		0.2	%
Expected life (years)		2.4			2.9
Expected volatility		80.5	%		77.4	%
Dividend yield		0.0	%		0.0	%
Black-Scholes Fair Value	$	1.26		$	2.52

The following table sets forth a summary of changes in the estimated fair value of our Level 3 warrant liability for the six months ended December 31, 2020 and 2019 (in thousands):


	Fair Value of Warrants Using Significant
	Unobservable Inputs (Level 3)
	2020			2019
Balance at July 1,	$	(40,483	)	$	(17,613	)
Change in estimated fair value of liability classified warrants		20,307			830

Balance at December 31,	$	(20,176	)	$	(16,783	)

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

License Agreements

6 Months Ended

Dec. 31, 2020

License Agreements

Note 3. License Agreements

KKC License, Development and Commercialization Agreement

In April 2020, we entered into the License, Development and Commercialization Agreement (the “KKC Commercialization Agreement”) with Kyowa Kirin Company (“KKC”). Under the agreement, we granted to KKC a

co-exclusive,

sublicensable, payment-bearing license under certain patents and

know-how

controlled by us to develop and commercialize zandelisib and any pharmaceutical product containing zandelisib for all human indications in the U.S. (the “U.S. License”), and an exclusive (subject to certain retained rights to perform obligations under the KKC Commercialization Agreement), sublicensable, payment-bearing, license under certain patents and

know-how

controlled by us to develop and commercialize zandelisib and any pharmaceutical product containing zandelisib for all human indications in countries outside of the United States (the

“Ex-U.S.”)

(the

“Ex-U.S.

license”). KKC granted to us a

co-exclusive,

sublicensable, license under certain patents and

know-how

controlled by KKC to develop and commercialize zandelisib for all human indications in the U.S., and a

co-exclusive,

sublicensable, royalty-free, fully paid license under certain patents and

know-how

controlled by KKC to perform our obligations in the

Ex-U.S.

under the KKC Commercialization Agreement. KKC paid us an initial payment of $100 million in May 2020. Of the $100 million paid by KKC, $20.4 million was remitted by KKC to the Japanese taxing authorities as a result of the U.S. Internal Revenue Service being closed due to the COVID pandemic, and therefore being unable to provide necessary documentation to support an exemption from the required foreign withholding. We received the amount remitted to the Japanese taxing authorities in October 2020. Additionally, we may earn up to approximately $582.5 million in potential development, regulatory and commercialization milestone payments, plus royalties on net sales of zandelisib in the

Ex-U.S.,

which are tiered beginning in the teens.

KKC will be responsible for the development and commercialization of zandelisib in the

Ex-U.S.

and, subject to certain exceptions, will be solely responsible for all costs related thereto. We will

co-develop

and

co-promote

zandelisib with KKC in the U.S., with the Company recording all revenue from U.S. sales. We will share U.S. profits and costs (including development costs) on a

50-50

basis with KKC. We will also provide to KKC certain drug supplies necessary for the development and commercialization of zandelisib in the

Ex-U.S.,

with the understanding that KKC will assume responsibility for manufacturing for the

Ex-U.S.

as soon as practicable.

We assessed the KKC Commercialization Agreement in accordance with Topic 808 and Topic 606 and determined that our obligations comprise the U.S. License, the

Ex-U.S.

License, and development services (the “Development Services”). We determined that the KKC Commercialization Agreement is a collaborative arrangement in accordance with Topic 808 that contains multiple units of account, as we and KKC are both active participants in the development and commercialization activities and are exposed to significant risks and rewards that are dependent on commercial success of the activities of the arrangement. The U.S. License is a unit of account under the scope of Topic 808 and is not a deliverable under Topic 606, while the

Ex-U.S.

License and Development Services performance obligations are under the scope of Topic 606.

We determined, at the time of our initial assessment, that the total transaction price of $191.5 million is comprised of the upfront payment of $100.0 million, expected milestone payments of $20.0 million, estimated development cost-sharing of $66.3 million, and deferred revenue of $5.2 million from the KKC Japan License Agreement (as defined below). During the six months ended December 31, 2020, we updated our initial assessment to reflect estimated development cost-sharing of $91.2 million. We included the amount of estimated variable consideration that is not constrained for development cost-sharing in the transaction price. Any variable consideration related to sales-based royalties and commercial milestones related to licenses of intellectual property will be determined when the sale or usage occurs, and is therefore excluded from the transaction price. In addition, we are eligible to receive future development and regulatory milestones upon the achievement of certain criteria; however, these amounts are excluded from variable consideration as the risk of significant revenue reversal will only be resolved depending on future research and development and/or regulatory approval outcomes. We

re-evaluate

the estimated variable consideration included in the transaction price and any related constraints at the end of each reporting period.

We allocated the transaction price to each unit of account. Variable consideration that relates specifically to our efforts to satisfy specific performance obligations are allocated entirely to those performance obligations. Other components of the transaction price are allocated based on the relative stand-alone selling price, over which management has applied significant judgment. We developed the estimated stand-alone selling price for the licenses using the risk-adjusted net present values of estimated cash flows, and the estimated stand-alone selling price of the development services performance obligations by estimating costs to be incurred, and an appropriate margin, using an income approach.

We determined that control of the U.S. License and

Ex-U.S.

License were transferred to KKC during the year ended June 30, 2020, and recognized revenue of $21.0 million related to the

Ex-U.S.

License. The $64.5 million transaction price allocated to the U.S. License obligation accounted for under Topic 808 is recorded as

non-current

deferred revenue and will begin to be recognized upon future commercialization as

non-ASC

606 revenue. As of December 31, 2020 and June 30, 2020, we recorded deferred revenue of $84.8 million and $18.1 million, respectively, for the transaction price allocated to the Development Services performance obligations and are recognizing this revenue based on the proportional performance of these development activities, which we expect to recognize through fiscal year 2026.

KKC Japan License Agreement

In October 2018, we, as licensor, entered into a license agreement with KKC for zandelisib (“the KKC Japan License Agreement”). Under the terms of the KKC Japan License Agreement, KKC was granted the exclusive right to develop and commercialize zandelisib in Japan. We also granted KKC the right to purchase supply of zandelisib for commercial requirements at cost plus a

pre-negotiated

percentage, as well as manufacturing rights in Japan. In return, we received an upfront payment of $10.0 million and were eligible to receive additional development and commercialization milestones, as well as royalties on net sales of zandelisib in Japan. In April 2020, we and KKC agreed to terminate the KKC Japan License Agreement. The KKC Japan License Agreement was replaced with the KKC Commercialization Agreement. Pursuant to the terms of the KKC Commercialization Agreement, we agreed to collaborate with KKC on the development, manufacturing and commercialization of zandelisib in Japan.

We assessed the KKC Japan License Agreement in accordance with ASC 606 and determined that our performance obligations comprised the license, research and development obligations, and our obligation to provide clinical trial materials to KKC. We determined that the transaction price amounted to the upfront payment of $10.0 million.

We determined that control of the license was transferred to KKC during the year ended June 30, 2019. Revenue allocated to the research and development obligations was recognized based on the proportional performance of these research and development activities. Revenue allocated to providing clinical trial materials was recognized upon delivery.

Helsinn License Agreement

In August 2016, we entered into an exclusive worldwide license, development, manufacturing and commercialization agreement with Helsinn Healthcare SA, a Swiss pharmaceutical corporation (“Helsinn”) for pracinostat in acute myeloid leukemia (“AML”), myelodysplastic syndrome (“MDS”) and other potential indications (the “Helsinn License Agreement”). Under the terms of the agreement, Helsinn was granted a worldwide exclusive license to develop, manufacture and commercialize pracinostat, and is primarily responsible for funding its global development and commercialization. As compensation for such grant of rights, we received payments of $20.0 million.

We determined that the agreement contains multiple performance obligations for purposes of revenue recognition. Revenue related to the research and development elements of the arrangement is recognized based on the extent of progress toward completion of each performance obligation. Revenue is recognized on a gross basis as we are the primary obligor and have discretion in supplier selection. During the six months ended December 31, 2020, our only remaining performance obligation under the agreement is the conduct of a Phase 2 dose-optimization study of pracinostat in combination with azacitidine in patients with high and very high risk MDS who are previously untreated with hypomethylating agents (the “POC study”), for which Helsinn has agreed to share third-party expenses.

Presage License Agreement

In September 2017, we entered into a license agreement with Presage Biosciences, Inc. (“Presage”). Under the terms of such license agreement (the “Presage License Agreement”), Presage granted to us exclusive worldwide rights to develop, manufacture and commercialize voruciclib, a clinical-stage, oral and selective CDK inhibitor, and related compounds. In exchange, we paid $2.9 million. With respect to the first indication, an incremental $2.0 million payment, due upon dosing of the first subject in the first registration trial, will be owed to Presage, for total payments of $4.9 million prior to receipt of marketing approval of the first indication in the U.S., E.U. or Japan. Additional potential payments of up to $179 million will be due upon the achievement of certain development, regulatory and commercial milestones. We will also pay

mid-single-digit

tiered royalties on the net sales of any product successfully developed. As an alternative to milestone and royalty payments related to countries in which we sublicense product rights, we will pay to Presage a tiered percent (which decreases as product development progresses) of amounts received from such sublicensees.

CyDex License Agreement

We are party to a license agreement with CyDex Pharmaceuticals, Inc. (“CyDex”). Under the license agreement, CyDex granted to us an exclusive, nontransferable license to intellectual property rights relating to Captisol

for use with our isoflavone-based drug compounds (currently

ME-344).

We agreed to pay to CyDex a

non-refundable

license issuance fee, future milestone payments, and royalties at a low, single-digit percentage rate on future sales of our approved drugs utilizing Captisol. Contemporaneously with the license agreement, CyDex entered into a commercial supply agreement with us, pursuant to which we agreed to purchase 100% of our requirements for Captisol from CyDex. We may terminate both the license agreement and the supply agreement at any time upon 90 days’ prior written notice.

BeiGene Collaboration

6 Months Ended

Dec. 31, 2020

BeiGene Collaboration

Note 4. BeiGene Collaboration

In October 2018, we entered into a clinical collaboration with BeiGene, Ltd. (“BeiGene”) to evaluate the safety and efficacy of zandelisib in combination with BeiGene’s zanubrutinib (marketed as Brukinsa

), an inhibitor of Bruton’s tyrosine kinase, for the treatment of patients with

B-cell

malignancies. Under the terms of the clinical collaboration agreement, we amended our ongoing Phase 1b trial to include evaluation of zandelisib in combination with zanubrutinib in patients with

B-cell

malignancies. Study costs are being shared equally by the parties, and we agreed to supply zandelisib and BeiGene agreed to supply zanubrutinib. We record the costs reimbursed by BeiGene as a reduction of our research and development expenses. We retained full commercial rights for zandelisib and BeiGene retained full commercial rights for zanubrutinib.

Net Loss Per Share

6 Months Ended

Dec. 31, 2020

Net Loss Per Share

Note 5. Net Loss Per Share

Basic and diluted net loss per share are computed using the weighted-average number of shares of common stock outstanding during the period, less any shares subject to repurchase or forfeiture. There were no shares of common stock subject to repurchase or forfeiture for the three and six months ended December 31, 2020 and 2019. Diluted net loss per share is computed based on the sum of the weighted average number of common shares and potentially dilutive common shares outstanding during the period.

The following table presents the calculation of net loss used to calculate basic loss and diluted loss per share (in thousands):


	Three Months Ended						Six Months Ended
	December 31,						December 31,
	2020			2019			2020			2019
Net loss - basic	$	(11,454	)	$	(20,217	)	$	(13,546	)	$	(23,211	)
Change in fair value of warrant liability		(7,083	)		—			(20,307	)		—

Net loss - diluted	$	(18,537	)	$	(20,217	)	$	(33,853	)	$	(23,211	)

Our potentially dilutive shares, which include outstanding stock options, restricted stock units, and warrants, are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive.

The following table presents weighted-average potentially dilutive shares that have been excluded from the calculation of net loss per share because of their anti-dilutive effect (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Stock options		15,128		10,929		15,347		10,930
Restricted stock units		430		—		430		—
Warrants		—		16,062		—		16,062

Total anti-dilutive shares		15,558		26,991		15,777		26,992

Commitments and Contingencies

6 Months Ended

Dec. 31, 2020

Commitments and Contingencies

Note 6. Commitments and Contingencies

We have contracted with various consultants and third parties to assist us in

pre-clinical

research and development and clinical trials work for our leading drug compounds. The contracts are terminable at any time, but obligate us to reimburse the providers for any time or costs incurred through the date of termination. We also have employment agreements with certain of our current employees that provide for severance payments and accelerated vesting for share-based awards if their employment is terminated under specified circumstances.

Presage License Agreement

As discussed in Note 3, we are party to a license agreement with Presage under which we may be required to make future payments upon the achievement of certain development, regulatory and commercial milestones, as well as potential future royalties based upon net sales. As of December 31, 2020, we have not accrued any amounts for potential future payments as achievement of the milestones has not been met.

S*Bio Purchase Agreement

We are party to a definitive asset purchase agreement with S*Bio, pursuant to which we acquired certain assets comprised of intellectual property and technology including rights to pracinostat. We agreed to make certain milestone payments to S*Bio based on the achievement of certain clinical, regulatory and net sales-based milestones, as well as to make certain contingent earnout payments to S*Bio. Milestone payments will be made to S*Bio up to an aggregate amount of $74.5 million if certain U.S., E.U. and Japanese regulatory approvals are obtained and if certain net sales thresholds are met in North America, the E.U. and Japan. As of December 31, 2020, we have not accrued any amounts for potential future payments as achievement of the milestones has not been met.

CyDex License Agreement

As discussed in Note 3, we are party to a license agreement with CyDex under which we may be required to make future payments upon the achievement of certain milestones, as well as potential future royalties based upon net sales. Contemporaneously with the license agreement, CyDex entered into a commercial supply agreement with us, pursuant to which we agreed to purchase 100% of our requirements for Captisol from CyDex. As of December 31, 2020, we have not accrued any amounts for potential future payments.

COVID-19

In January 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the

“COVID-19

outbreak”) and the risks to the international community. In March 2020, the WHO classified the

COVID-19

outbreak as a pandemic, based on the rapid increase in exposure globally. As a result of the

COVID-19

pandemic, which continues to rapidly evolve, “shelter in place” orders and other public health guidance measures have been implemented across much of the United States, Europe and Asia, including in the locations of our offices, clinical trial sites, key vendors and partners. Despite the relaxation of many governmental orders in

mid-2020,

the “second wave” of the

COVID-19

outbreak has resulted in the

re-imposition

of many of these measures. In addition, although the FDA has approved vaccines for the treatment of

COVID-19,

the effectiveness and timing of distribution of the vaccines remains highly uncertain. The

COVID-19

virus may mutate into different strains that are more contagious or severe or for which treatments are unavailable. While we continue to enroll and dose patients in our clinical trials, our clinical development program timelines continue to be subject to potential negative impacts from the ongoing pandemic. The extent to which the outbreak impacts our business, preclinical studies and clinical trials will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the ultimate geographic spread of the disease, the duration of the pandemic, the effectiveness and timing of distribution of treatments for

COVID-19,

travel restrictions and social distancing in the United States and other countries, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease and to minimize its economic impact.

CARES Act

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was signed into law. The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations, increased limitations on qualified charitable contributions, and technical corrections to tax depreciation methods for qualified improvement property. Regulatory guidance has indicated that public companies are ineligible to participate in certain of the loan programs provided by the CARES Act. There is substantial uncertainty with respect to the scope, content or timing of any further economic stimulus programs to address the economic downturn related to the

COVID-19

outbreak. We do not expect that the CARES Act will have a material impact on our financial condition, results of operation, or liquidity.

Legal Proceedings

On August 10, 2020, Guy Bahat, an individual who allegedly purchased 50 shares of our common stock filed a putative securities class action lawsuit (the “Securities Class Action”) in the United States District Court for the Southern District of California against the Company, Dr. Daniel P. Gold, and Mr. Brian G. Drazba, asserting claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule

10b-5

thereunder. Mr. Bahat did not seek appointment as lead plaintiff, and the court appointed another individual, Ramesh Mahalingham, as lead plaintiff. The plaintiff seeks to sue on behalf of all purchasers of our securities from August 2, 2017 through July 1, 2020 and alleges, among other things, that we made false and misleading statements relating to pracinostat during the proposed class period. We believe that the claims are without merit, as to both the facts and the law, and intend to vigorously defend the case.

On October 21, 2020, Peter D’Arcy, an individual who alleges that he is a Company stockholder, filed a putative stockholder derivative action nominally on behalf of the Company in the United States District Court for the District of Delaware (the “Derivative Action”) against Dr. Gold, Mr. Drazba, Mr. Charles V. Baltic, III, Dr. Kevan E. Clemens, Mr. Frederick W. Driscoll, Dr. Nicholas R. Glover, Ms. Tamar D. Howson, Dr. Thomas C. Reynolds, Mr. William D. Rueckert, and Dr. Christine A. White, and naming the Company as a nominal defendant. Additional putative stockholder derivative suits were filed in the same court naming the same defendants plus Dr. Robert D. Mass on December 2, 2020 and December 15, 2020 by Gerald Wright and William Trablicy, respectively, who also allege that they are Company stockholders, and these additional suits were consolidated into the Derivative Action by court order. The Derivative Action is based upon the pracinostat-related allegations in the Securities Class Action described above, and alleges claims under Section 14(a) of the Exchange Act and claims for breach of fiduciary duty, unjust enrichment, corporate waste, and contribution. We believe the plaintiffs in the Derivative Action lack standing to sue on behalf of the Company.

At this stage, we cannot predict the ultimate outcome of the Securities Class Action or the Derivative Action or whether they will result in any loss. Accordingly, we have not accrued an amount for any potential loss associated with these actions.

Leases

6 Months Ended

Dec. 31, 2020

Disclosure Text Block [Abstract]

Leases

Note 7. Leases

In December 2019, we entered into a lease agreement for approximately 32,800 square feet of office space in San Diego, California. We have accounted for the lease as an operating lease. The contractual lease term began in July 2020 and is scheduled to expire in March 2028. The lease contains an option to renew and extend the lease terms. We have not included the lease extension within the ROU asset and lease liability on the balance sheet as it is not reasonably certain to be exercised. The lease includes variable

non-lease

components (e.g. common area maintenance, maintenance, etc.) that are not included in the ROU asset and lease liability and are reflected as an expense in the period incurred. We do not have any other operating or finance leases. Upon commencement of the lease, we recognized an operating lease ROU asset of $8.7 million and a corresponding operating lease liability of $8.7 million.

The total operating lease costs were as follows (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Operating lease cost	$	377	$	214	$	753	$	402

Supplemental cash flow information related to our operating leases were as follows (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	123	$	201	$	246	$	402
Right-of-use assets obtained in exchange for operating lease obligations:		—		—		8,689		—

The following is a schedule of the future minimum rental payments for our operating lease, reconciled to the lease liability as of December 31, 2020 (in thousands):


	December 31, 2020
Remainder of fiscal year ending June 30, 2021	$	737
Years ending June 30, 2022		1,519
2023		1,565
2024		1,612
2025		1,168
2026		1,710
Thereafter		3,122

Total lease payments		11,433
Less: Present value discount		(2,718	)

Total operating lease liability	$	8,715

Balance Sheet Classification - Operating Lease
Operating lease liability	$	873
Operating lease liability, long-term		7,842

Total operating lease liability	$	8,715

Other Balance Sheet Information- Operating Lease
Weighted average remaining lease term (in years)		7.3
Weighted average discount rate		7.50	%

Short-Term Investments

6 Months Ended

Dec. 31, 2020

Short-Term Investments

Note 8. Short-Term Investments

As of December 31, 2020 and June 30, 2020, our short-term investments consisted of $170.3 million and $170.3 million, respectively, in U.S. government securities. The short-term investments held as of December 31, 2020 and June 30, 2020 had maturity dates of less than one year, are considered to be “held to maturity” and are carried at amortized cost. As of December 31, 2020 and June 30, 2020, the gross holding gains and losses were immaterial.

Stockholders' Equity

6 Months Ended

Dec. 31, 2020

Stockholders' Equity

Note 9. Stockholders’ Equity

Equity Transactions

At-The-Market

Equity Offering

On November 10, 2020, we entered into an

At-The-Market

Equity Offering Sales Agreement (the “2020 ATM Sales Agreement”), pursuant to which we may sell an aggregate of up to $60.0 million of our common stock pursuant to the shelf registration statement. We had previously entered into an

At-The-Market

Equity Offering Sales Agreement in November 2017 (the “2017 ATM Sales Agreement”), pursuant to which we could sell an aggregate of up to $30.0 million of our common stock pursuant to the shelf registration statement. The 2017 ATM Sales Agreement expired on November 8, 2020. During the six months ended December 31, 2020, we sold 958,083 shares under the 2017 ATM Sales Agreement for net proceeds of $3.1 million, after costs of $0.1 million. As of December 31, 2020, there is $60.0 million remaining available under the 2020 ATM Sales Agreement.

Shelf Registration Statement

We have a shelf registration statement that permits us to sell, from time to time, up to $200.0 million of common stock, preferred stock and warrants. The shelf registration was filed and declared effective in May 2020, replacing our prior shelf registration statement that was filed and declared effective in May 2017, and carrying forward approximately $107.5 million of unsold securities registered under the prior shelf registration statement. As of December 31, 2020, there is $175.7 million aggregate value of securities available under the shelf registration statement, including up to $60.0 million remaining available under the 2020 ATM Sales Agreement.

Warrants

As of December 31, 2020, we have outstanding warrants to purchase 16,061,602 shares of our common stock. The warrants are fully vested, exercisable at a price of $2.54 per share and expire in May 2023. Pursuant to the terms of the warrants, we could be required to settle the warrants in cash in the event of an acquisition of the Company and, as a result, the warrants are required to be measured at fair value and reported as a liability in the Condensed Balance Sheet. Therefore, we are required to account for the warrants as liabilities and record them at fair value. The warrants were revalued as of December 31, 2020 at $20.2 million and as of June 30, 2020 at $40.5 million; the changes in fair value were recorded in our Condensed Statement of Operations. No warrants were exercised during the six months ended December 31, 2020 and 2019.

Share-based Compensation

6 Months Ended

Dec. 31, 2020

Share-based Compensation

Note 10. Share-based Compensation

We use equity-based compensation programs to provide long-term performance incentives for our employees. These incentives consist primarily of stock options and RSUs. In December 2008, we adopted the MEI Pharma, Inc. 2008 Stock Omnibus Equity Compensation Plan (“2008 Plan”), as amended and restated in 2011, 2013, 2014, 2015, 2016, 2018 and 2020, under which 29,014,794 shares of common stock are authorized for issuance. The 2008 Plan provides for the grant of options and/or other stock-based or stock-denominated awards to our

non-employee

directors, officers, employees and advisors. As of December 31, 2020, there were 11,112,365 shares available for future grant under the 2008 Plan.

Total share-based compensation expense for all stock awards consists of the following, (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Research and development	$	1,160	$	743	$	2,289	$	1,524
General and administrative		1,449		1,028		3,262		2,360

Total share-based compensation	$	2,609	$	1,771	$	5,551	$	3,884

Stock Options

Stock option activity for the six months ended December 31, 2020 was as follows:


	Number of Options			Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Outstanding at June 30, 2020		11,252,976		$	2.81
Granted		4,890,300			3.38
Exercised		(56,088	)		2.47
Forfeited / Cancelled		(178,828	)		3.53

Outstanding at December 31, 2020		15,908,360			2.98		8.0	$	3,430,245

Vested and exercisable at December 31, 2020		7,252,642			2.71		6.9	$	2,944,999

The fair value of each stock option granted during the six months ended December 31, 2020 is estimated on the grant date under the fair value method using a Black-Scholes valuation model. Stock options granted to employees during the six months ended December 31, 2020 vest 25% one year from the date of grant and ratably each month thereafter for a period of 36 months and expire ten years from the date of grant. Stock options granted to directors during the six months ended December 31, 2020 vest ratably each month for a period of 12 months from the date of grant and expire ten years from the date of grant. The estimated fair values of the stock options, including the effect of estimated forfeitures, are expensed over the service period.

The following weighted-average assumptions were used to determine the fair value of options granted during the period:


	Six Months Ended December 31,
	2020			2019
Risk-free interest rate		0.4	%		1.8	%
Expected life (years)		6.0			6.0
Expected volatility		80.8	%		73.5	%
Dividend yield		0.0	%		0.0	%
Weighted-average grant date fair value	$	2.30		$	1.60

As of December 31, 2020, there was $10.5 million of unrecognized compensation expense related to the unvested portion of stock options. Such compensation expense is expected to be recognized over a weighted-average period of 1.7 years.

Restricted Stock Units

In July 2020, we granted 442,650 RSUs to employees. Each RSU represented the contingent right to receive one share of our common stock. The RSUs will vest in periods of either one year or two years from the date of grant. The fair value of the RSUs was measured at $3.49 per unit. Under the terms of the 2008 Plan, each of the RSUs is calculated as 1.25 shares of common stock for purposes of determining the number of shares available for future grant. There were forfeitures of 12,000 RSUs during the six months ended December 31, 2020, and 430,650 unvested RSUs were outstanding as of December 31, 2020. As of December 31, 2020, unrecognized compensation expense related to the unvested portion of our RSUs was approximately $1.0 million and is expected to be recognized over approximately 1.3 years.

The Company and Summary of Significant Accounting Policies (Policies)

6 Months Ended

Dec. 31, 2020

Clinical Development Programs

•

Zandelisib (formerly known as

ME-401),

an oral phosphatidylinositol

3-kinase

(“PI3K”) delta inhibitor;

•

Voruciclib, an oral cyclin-dependent kinase (“CDK”) inhibitor;

•

ME-344,

a mitochondrial inhibitor targeting the oxidative phosphorylation (“OXPHOS”) complex; and

•

Pracinostat, an oral histone deacetylase (“HDAC”) inhibitor.

The results of

pre-clinical

ME-344,

Liquidity

Basis of Presentation

10-Q

and Article 10 of Regulation

S-X.

10-K

(“2020 Annual Report”) filed with the Securities and Exchange Commission on September 9, 2020. Interim results are not necessarily indicative of results for a full year.

Use of Estimates

Revenue Recognition

ASC Topic 606, Revenue from Contracts with Customers (“Topic 606”)

Payments received under commercial arrangements, such as licensing technology rights, may include

non-refundable

re-evaluate

catch-up

basis, which would affect revenues and earnings in the period of adjustment.

In the case of a license that is a distinct performance obligation, we recognize revenue allocated to the license from

non-refundable,

up-front

cost-to-cost

measure of progress because it best depicts the transfer of control to the customer which occurs as we incur costs. Under the

cost-to-cost

We recognized revenue associated with the following license agreements (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
KKC License Agreements	$	9,090	$	673	$	12,658	$	1,470
Helsinn License Agreement		77		335		343		695

	$	9,167	$	1,008	$	13,001	$	2,165

Timing of Revenue Recognition:
Services performed over time	$	9,167	$	1,008	$	13,001	$	2,165

	$	9,167	$	1,008	$	13,001	$	2,165

Contract Balances


	Six Months Ended December 31,
	2020			2019
Receivables
Receivables, beginning of period	$	2,605		$	—
Net change		(2,205	)		96

Receivables, end of period	$	400		$	96

Contract assets
Contract assets, beginning of period	$	604		$	686
Net change		9,602			(205	)

Contract assets, end of period	$	10,206		$	481

Contract liabilities
Contract liabilities, beginning of period	$	82,500		$	7,774
Net change		2,334			(1,610	)

Contract liabilities, end of period	$	84,834		$	6,164

Ex-U.S.

Revenues from Collaborators

We earn revenue in connection with collaboration agreements, which are described in Note 3, License Agreements, and Note 4, BeiGene Collaboration.

At contract inception, we assess whether the collaboration arrangements are within the scope of ASC Topic 808,

Collaborative Arrangements

Cost of Revenue

Research and Development Costs

in-process

research and development for early-stage products or products that are not commercially viable and ready for use, or have no alternative future use, are charged to expense in the period incurred.

Share-based Compensation

Income Taxes

Leases

Effective July 1, 2019, we adopted FASB ASC Topic 842,

Leases

right-of-use

Rent expense for operating leases is recognized on a straight-line basis over the lease term based on the total lease payments. We have elected the practical expedient to not separate lease and

non-lease

components for our real estate leases. Our

non-lease

components are primarily related to property maintenance, which varies based on future outcomes, and thus is recognized in rent expense when incurred.

- Definition

Disclosure of accounting policy for income taxes, which may include its accounting policies for recognizing and measuring deferred tax assets and liabilities and related valuation allowances, recognizing investment tax credits, operating loss carryforwards, tax credit carryforwards, and other carryforwards, methodologies for determining its effective income tax rate and the characterization of interest and penalties in the financial statements.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 45
-Paragraph 25
-URI http://asc.fasb.org/extlink&oid=120406818&loc=d3e32247-109318

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

The Company and Summary of Significant Accounting Policies (Tables)

6 Months Ended

Dec. 31, 2020

Schedule Of Revenue Associated With License Agreement

We recognized revenue associated with the following license agreements (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
KKC License Agreements	$	9,090	$	673	$	12,658	$	1,470
Helsinn License Agreement		77		335		343		695

	$	9,167	$	1,008	$	13,001	$	2,165

Timing of Revenue Recognition:
Services performed over time	$	9,167	$	1,008	$	13,001	$	2,165

	$	9,167	$	1,008	$	13,001	$	2,165

Schedule of Changes in Contract Assets and Contract Liabilities

The following table presents changes in contract assets and contract liabilities during the six months ended December 31, 2020 and 2019 (in thousands):


	Six Months Ended December 31,
	2020			2019
Receivables
Receivables, beginning of period	$	2,605		$	—
Net change		(2,205	)		96

Receivables, end of period	$	400		$	96

Contract assets
Contract assets, beginning of period	$	604		$	686
Net change		9,602			(205	)

Contract assets, end of period	$	10,206		$	481

Contract liabilities
Contract liabilities, beginning of period	$	82,500		$	7,774
Net change		2,334			(1,610	)

Contract liabilities, end of period	$	84,834		$	6,164

Fair Value Measurements (Tables)

6 Months Ended

Dec. 31, 2020

Schedule of Financial Instruments Measured at Fair Value on Recurring Basis

We measure the following financial instruments at fair value on a recurring basis. The fair values of these financial instruments were as follows (in thousands):


	December 31, 2020							June 30, 2020
	Level 1		Level 2		Level 3			Level 1		Level 2		Level 3
Warrant liability	$	—	$	—	$	(20,176	)	$	—	$	—	$	(40,483	)

Total	$	—	$	—	$	(20,176	)	$	—	$	—	$	(40,483	)

Schedule of Assumptions Used to Calculate Fair Value of Warrant Liability

To calculate the fair value of the warrant liability, the following assumptions were used:


	December 31,			June 30,
	2020			2020
Risk-free interest rate		0.1	%		0.2	%
Expected life (years)		2.4			2.9
Expected volatility		80.5	%		77.4	%
Dividend yield		0.0	%		0.0	%
Black-Scholes Fair Value	$	1.26		$	2.52

Schedule of Changes in Estimated Fair Value of Warrant Liability

The following table sets forth a summary of changes in the estimated fair value of our Level 3 warrant liability for the six months ended December 31, 2020 and 2019 (in thousands):


	Fair Value of Warrants Using Significant
	Unobservable Inputs (Level 3)
	2020			2019
Balance at July 1,	$	(40,483	)	$	(17,613	)
Change in estimated fair value of liability classified warrants		20,307			830

Balance at December 31,	$	(20,176	)	$	(16,783	)

Net Loss Per Share (Tables)

6 Months Ended

Dec. 31, 2020

Schedule of Income (Loss) Per Share, Basic and Diluted

The following table presents the calculation of net loss used to calculate basic loss and diluted loss per share (in thousands):


	Three Months Ended						Six Months Ended
	December 31,						December 31,
	2020			2019			2020			2019
Net loss - basic	$	(11,454	)	$	(20,217	)	$	(13,546	)	$	(23,211	)
Change in fair value of warrant liability		(7,083	)		—			(20,307	)		—

Net loss - diluted	$	(18,537	)	$	(20,217	)	$	(33,853	)	$	(23,211	)

Antidilutive Securities

The following table presents weighted-average potentially dilutive shares that have been excluded from the calculation of net loss per share because of their anti-dilutive effect (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Stock options		15,128		10,929		15,347		10,930
Restricted stock units		430		—		430		—
Warrants		—		16,062		—		16,062

Total anti-dilutive shares		15,558		26,991		15,777		26,992

Leases (Tables)

6 Months Ended

Dec. 31, 2020

Disclosure Text Block [Abstract]

Schedule of Total Operating Costs

The total operating lease costs were as follows (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Operating lease cost	$	377	$	214	$	753	$	402

Schedule of Supplemental Cash Flow Information Related to Operating Leases

Supplemental cash flow information related to our operating leases were as follows (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	123	$	201	$	246	$	402
Right-of-use assets obtained in exchange for operating lease obligations:		—		—		8,689		—

Schedule of Future Minimum Rental Payments

The following is a schedule of the future minimum rental payments for our operating lease, reconciled to the lease liability as of December 31, 2020 (in thousands):


	December 31, 2020
Remainder of fiscal year ending June 30, 2021	$	737
Years ending June 30, 2022		1,519
2023		1,565
2024		1,612
2025		1,168
2026		1,710
Thereafter		3,122

Total lease payments		11,433
Less: Present value discount		(2,718	)

Total operating lease liability	$	8,715

Balance Sheet Classification - Operating Lease
Operating lease liability	$	873
Operating lease liability, long-term		7,842

Total operating lease liability	$	8,715

Other Balance Sheet Information- Operating Lease
Weighted average remaining lease term (in years)		7.3
Weighted average discount rate		7.50	%

Share-based Compensation (Tables)

6 Months Ended

Dec. 31, 2020

Share-Based Compensation Expense for Stock Awards

Total share-based compensation expense for all stock awards consists of the following, (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Research and development	$	1,160	$	743	$	2,289	$	1,524
General and administrative		1,449		1,028		3,262		2,360

Total share-based compensation	$	2,609	$	1,771	$	5,551	$	3,884

Summary of Stock Option Activity and Related Data

Stock option activity for the six months ended December 31, 2020 was as follows:


	Number of Options			Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Outstanding at June 30, 2020		11,252,976		$	2.81
Granted		4,890,300			3.38
Exercised		(56,088	)		2.47
Forfeited / Cancelled		(178,828	)		3.53

Outstanding at December 31, 2020		15,908,360			2.98		8.0	$	3,430,245

Vested and exercisable at December 31, 2020		7,252,642			2.71		6.9	$	2,944,999

Fair Value of Stock Options Weighted-Average Assumptions Used

The following weighted-average assumptions were used to determine the fair value of options granted during the period:


	Six Months Ended December 31,
	2020			2019
Risk-free interest rate		0.4	%		1.8	%
Expected life (years)		6.0			6.0
Expected volatility		80.8	%		73.5	%
Dividend yield		0.0	%		0.0	%
Weighted-average grant date fair value	$	2.30		$	1.60

The Company and Summary of Significant Accounting Policies - Additional Information (Detail)	3 Months Ended		6 Months Ended
	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2020 USD ($) ClinicalTrials	Dec. 31, 2019 USD ($)	Jun. 30, 2020 USD ($)	Jun. 30, 2019 USD ($)
Targeted or Tracking Stock, Stock [Line Items]
Number of clinical stage candidates \| ClinicalTrials			4
Deferred Revenue Associated With Remaining Performance Obligation	$ 84,800,000		$ 84,800,000
Unrecognized tax benefits	0		0		$ 0
Revenue Recognised With Performance Obligation	9,100,000	$ 700,000	12,700,000	$ 1,500,000
Accumulated Losses Since Inception	(290,780,000)		(290,780,000)		(277,234,000)
Cash And Cash Equivalents,Short Term Investments And Common Stock Proceeds Receivable	180,100,000		180,100,000
Contract assets, Current	10,206,000	481,000	10,206,000	481,000	$ 604,000	$ 686,000
Increase in contract assets			9,602,000	(205,000)
US License
Targeted or Tracking Stock, Stock [Line Items]
Deferred Revenue Associated With Remaining Performance Obligation	64,500,000		64,500,000
Ex US License
Targeted or Tracking Stock, Stock [Line Items]
Deferred Revenue Associated With Remaining Performance Obligation	20,300,000		20,300,000
Helsinn License Agreement
Targeted or Tracking Stock, Stock [Line Items]
Deferred Revenue, Revenue Recognized	100,000	300,000	300,000	700,000
KKC Commercialization Agreement And The Helsinn License Agreement
Targeted or Tracking Stock, Stock [Line Items]
Contract assets, Current	10,200,000		10,200,000
Increase in contract assets			18,400,000
KKC Agreements and Helsinn License Agreement
Targeted or Tracking Stock, Stock [Line Items]
Contract with Customer, Liability, Revenue Recognized	$ 9,200,000	$ 1,000,000	$ 12,700,000	$ 1,800,000

The Company - Revenue Associated With The Following license agreements (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Recognized Revenue Associated with The Following License Agreements [Line Items]
Revenues	$ 9,167	$ 1,008	$ 13,001	$ 2,165
KKC License Agreement [Member]
Recognized Revenue Associated with The Following License Agreements [Line Items]
Revenues	9,090	673	12,658	1,470
Helsinn License Agreement [Member]
Recognized Revenue Associated with The Following License Agreements [Line Items]
Revenues	77	335	343	695
Services performed over time [Member]
Recognized Revenue Associated with The Following License Agreements [Line Items]
Revenues	$ 9,167	$ 1,008	$ 13,001	$ 2,165

- Definition

Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

The Company - Schedule of Changes in Contract Assets and Contract Liabilities (Detail) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Contract with Customer Asset and Liability [Line Items]
Receivables, beginning of period	$ 2,605
Net change	(2,205)	96
Receivables, end of period	400
Contract assets, beginning of period	604	686
Net change	9,602	(205)
Contract assets, end of period	10,206	481
Contract liabilities, beginning of period	82,500	7,774
Net change	2,334	(1,610)
Contract liabilities, end of period	$ 84,834	$ 6,164

Schedule of Financial Instruments Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020	Dec. 31, 2019	Jun. 30, 2019
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Warrant liability	$ (20,176)	$ (40,483)
Level 3 \| Fair Value, Measurements, Recurring [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Warrant liability	(20,176)	(40,483)	$ (16,783)	$ (17,613)
Total liability	$ (20,176)	$ (40,483)

Schedule of Assumptions Used to Calculate Fair Value of Warrant Liability (Detail) - ClinicalTrials	Dec. 31, 2020	Jun. 30, 2020
Risk Free Interest Rate
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Warrants and Rights Outstanding, Measurement Input	0.1	0.2
Expected life years
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Warrants and Rights Outstanding, Measurement Input	2.4	2.9
Expected volatility
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Warrants and Rights Outstanding, Measurement Input	80.5	77.4
Dividend Yield
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Warrants and Rights Outstanding, Measurement Input	0.0	0.0
Black-Scholes Fair Value
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Warrants and Rights Outstanding, Measurement Input	1.26	2.52

Schedule of Changes in Estimated Fair Value of Warrant Liability (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Fair value measurements Significant unobservable inputs [Line Items]
Beginning balance			$ (40,483)
Change in estimated fair value of liability classified warrants	$ 7,083	$ (8,439)	20,307	$ 830
Ending balance	(20,176)		(20,176)
Fair Value, Measurements, Recurring [Member] \| Level 3
Fair value measurements Significant unobservable inputs [Line Items]
Beginning balance			(40,483)	(17,613)
Change in estimated fair value of liability classified warrants			20,307	830
Ending balance	$ (20,176)	$ (16,783)	$ (20,176)	$ (16,783)

License Agreements - Additional Information (Detail)		1 Months Ended		6 Months Ended	12 Months Ended
License Agreements - Additional Information (Detail)	Aug. 31, 2016 USD ($)	Oct. 31, 2018 USD ($)	Sep. 30, 2017 USD ($)	Dec. 31, 2020 USD ($)	Jun. 30, 2020 USD ($)	May 31, 2020 USD ($)
Related Party Transaction [Line Items]
Percentage of Purchase Requirement				100.00%
License and supply agreement notice period				90 days
Profit sharing ratio				0.5
Receivable for foreign tax withholding				$ 20,420,000
Kyowa Kirin Co
Related Party Transaction [Line Items]
Upfront payment		$ 10,000,000
Total upfront payment receivable for grant of rights				100,000,000		$ 100,000,000
Receivable for foreign tax withholding				20,400,000
Kyowa Kirin Co \| Updation of Initial Assessment
Related Party Transaction [Line Items]
Estimated development cost sharing recovered through earnings				91,200,000
Kyowa Kirin Co \| Potential Payments on Achievement of Development Regulatory and Commercial Milestones
Related Party Transaction [Line Items]
Total upfront payment receivable for grant of rights					$ 10,000,000
Kyowa Kirin Co \| Potential Payments on Achievement of Development Regulatory and Commercial Milestones \| Maximum
Related Party Transaction [Line Items]
Milestone payment receivable amount				582,500,000
Helsinn License Agreement
Related Party Transaction [Line Items]
Compensation receivable for grant of rights	$ 20,000,000
Presage License Agreement \| Presage Biosciences, Inc.
Related Party Transaction [Line Items]
Compensation payable for grant of rights			$ 4,900,000
Payment for license			2,900,000
Presage License Agreement \| Presage Biosciences, Inc. \| Incremental Payment
Related Party Transaction [Line Items]
Compensation payable for grant of rights			2,000,000
Presage License Agreement \| Presage Biosciences, Inc. \| Potential Payments on Achievement of Development Regulatory and Commercial Milestones \| Maximum
Related Party Transaction [Line Items]
Milestone payments payable amount			$ 179,000,000
KKC License Agreement \| Kyowa Kirin Co
Related Party Transaction [Line Items]
Upfront payment				100,000,000
Transaction price relating to the performance obligation				191,500,000
Expected milestone payment receivable				20,000,000
Estimated development cost sharing recovered through earnings				66,300,000
Deferred revenue				5,200,000
KKC License Agreement \| Kyowa Kirin Co \| Ex US License
Related Party Transaction [Line Items]
Performance obligation revenue recognised					21,000,000
License Obligation Account Transaction Price Allocated					64,500,000
KKC License Agreement \| Kyowa Kirin Co \| Development Services
Related Party Transaction [Line Items]
Contract with customer liability non current				$ 84,800,000	$ 18,100,000

Net Loss Per Share - Additional Information (Detail) - shares	6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Potentially Dilutive Securities Outstanding [Line Items]
Common stock subject to repurchase or forfeiture	0	0

Schedule of (Loss) Per Share, Basic and Diluted (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Net loss - basic	$ (11,454)	$ (20,217)	$ (13,546)	$ (23,211)
Change in fair value of warrant liability	(7,083)		(20,307)
Net loss - diluted	$ (18,537)	$ (20,217)	$ (33,853)	$ (23,211)

- Definition

Amount, after deduction of tax, noncontrolling interests, dividends on preferred stock and participating securities; of income (loss) available to common shareholders.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22595-107794

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=121326447&loc=d3e1448-109256

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22694-107794

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=121326447&loc=d3e1377-109256

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3550-109257

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 260
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-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=121326447&loc=SL5780133-109256

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 10: http://www.xbrl.org/2003/role/exampleRef
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-Name Accounting Standards Codification
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
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-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

+ Details

Antidilutive Securities (Detail) - shares shares in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Potentially Dilutive Securities Outstanding [Line Items]
Total anti-dilutive shares	15,558	26,991	15,777	26,992
Employee Stock option
Potentially Dilutive Securities Outstanding [Line Items]
Total anti-dilutive shares	15,128	10,929	15,347	10,930
Restricted Stock Units (RSUs)
Potentially Dilutive Securities Outstanding [Line Items]
Total anti-dilutive shares	430		430
Warrants
Potentially Dilutive Securities Outstanding [Line Items]
Total anti-dilutive shares		16,062		16,062

Commitments and Contingencies - Additional Information (Detail)	6 Months Ended
	Dec. 31, 2020 USD ($)
Purchase Commitment, Excluding Long-term Commitment [Line Items]
Future aggregate milestone payments	$ 74,500,000
Percentage of Purchase Requirement	100.00%
S*Bio Purchase Agreement
Purchase Commitment, Excluding Long-term Commitment [Line Items]
Accrued payment for potential future payments	$ 0
CyDex License Agreement
Purchase Commitment, Excluding Long-term Commitment [Line Items]
Accrued payment for potential future payments	0
Presage License Agreement
Purchase Commitment, Excluding Long-term Commitment [Line Items]
Accrued payment for potential future payments	$ 0

Leases - Additional Information (Detail) $ in Thousands	Dec. 01, 2019 ft²	Dec. 31, 2020 USD ($)
Operating lease right of use assets		$ 8,700
Operating lease liabilities		$ 8,715
Accounting Standards Update 2016-02 [Member] \| San Diego California [Member]
Number of square feet under lease \| ft²	32,800
Lease expire date	Mar. 31, 2028

Schedule of Total Operating Costs (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Leases [Abstract]
Operating lease cost	$ 377	$ 214	$ 753	$ 402

Schedule of Supplemental Cash Flow Information Related to Operating Leases (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$ 123	$ 201	$ 246	$ 402
Right-of-use assets obtained in exchange for operating lease obligations:			$ 8,689

Schedule of Future Minimum Rental Payments (Detail) $ in Thousands	Dec. 31, 2020 USD ($)
Disclosure Text Block [Abstract]
Remainder of fiscal year ending June 30, 2021	$ 737
Years ending June 30, 2022	1,519
2023	1,565
2024	1,612
2025	1,168
2026	1,710
Thereafter	3,122
Total lease payments	11,433
Less: Present value discount	(2,718)
Total operating lease liability	8,715
Operating lease liabilities	873
Operating lease liabilities, long-term	7,842
Total operating lease liability	$ 8,715
Weighted average remaining lease term (in years)	7 years 3 months 18 days
Weighted average discount rate	7.50%

Short-Term Investments - Additional Information (Detail) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020
Schedule of Equity Method Investments [Line Items]
Short-term investments	$ 170,267	$ 170,299

Stockholders' Equity - Additional Information (Detail) - USD ($)	3 Months Ended			6 Months Ended
	Sep. 30, 2020	Dec. 31, 2019	Sep. 30, 2019	Dec. 31, 2020	Nov. 10, 2020	Jun. 30, 2020	Nov. 08, 2017
Class of Stock [Line Items]
Fair value of warrants				$ 20,176,000		$ 40,483,000
Aggregate value of securities available under shelf registration statement				100,000
Common stock Value Issued	$ 3,136,000	$ 48,451,000	$ 159,000
Unsold Securities Shares and Warrants Under Agreement				107,500,000
Aggregate Value of Securities Available Under Agreement				$ 175,700,000
Warrant [Member]
Class of Stock [Line Items]
Exercise price				$ 2.54
Warrants outstanding				16,061,602
ATM Sales Agreement
Class of Stock [Line Items]
Common stock share issued				958,083
Common stock Value Issued				$ 3,100,000
Two Thousand And Twenty At The Market Sale Agreement
Class of Stock [Line Items]
Aggregate value of securities available under shelf registration statement				60,000,000
Maximum
Class of Stock [Line Items]
Sale of shares and warrants under agreement				200,000,000
Maximum \| ATM Sales Agreement
Class of Stock [Line Items]
Sale of shares under agreement							$ 30,000,000
Maximum \| Two Thousand And Twenty At The Market Sale Agreement
Class of Stock [Line Items]
Sale of shares under agreement				$ 60,000,000	$ 60,000,000

Share-based Compensation - Additional Information (Detail) $ / shares in Units, $ in Millions	1 Months Ended	6 Months Ended
	Jul. 31, 2020 shares	Dec. 31, 2020 USD ($) $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense related to unvested stock options \| $		$ 10.5
Expected weighted average period for recognition of compensation expense		1 year 8 months 12 days
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option vested percentage		25.00%
Share-based compensation arrangement by share-based payment award, expiration period		10 years
Employee Stock Option \| Share-based Payment Arrangement Tranche Two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, award vesting period		36 months
Employee Stock Option \| Directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, expiration period		10 years
Restricted Stock Units (RSUs) \| Employees
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected weighted average period for recognition of compensation expense		1 year 3 months 18 days
RSUs granted	442,650
Number of common stock to be received for each RSUs		1
RSUs grant date fair value per unit \| $ / shares		$ 3.49
Restricted stock units forfeiture during the period		12,000
Share based compensation by share based payment arrangement other than options unvested outstanding		430,650
Share based compensation by share based payment arrangement other than options unvested cost not yet recognised amount \| $		$ 1.0
Number of shares for each unit of restricted stock		1.25
2008 Omnibus Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock authorized		29,014,794
Shares available for future grant		11,112,365
Maximum [Member] \| Restricted Stock Units (RSUs) \| Employees
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, award vesting period		2 years
Minimum [Member] \| Directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, award vesting period		12 months
Minimum [Member] \| Restricted Stock Units (RSUs) \| Employees
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, award vesting period		1 year

Share-Based Compensation Expense for Stock Awards (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based compensation	$ 2,609	$ 1,771	$ 5,551	$ 3,884
Research and development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based compensation	1,160	743	2,289	1,524
General and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based compensation	$ 1,449	$ 1,028	$ 3,262	$ 2,360

Summary of Stock Option Activity (Detail)	6 Months Ended
Summary of Stock Option Activity (Detail)	Dec. 31, 2020 USD ($) $ / shares shares
Number of Options
Beginning Balance \| shares	11,252,976
Granted \| shares	4,890,300
Exercised \| shares	(56,088)
Forfeited / Cancelled \| shares	(178,828)
Ending balance \| shares	15,908,360
Vested and exercisable at end of period \| shares	7,252,642
Weighted- Average Exercise Price
Beginning Balance \| $ / shares	$ 2.81
Granted \| $ / shares	3.38
Exercised \| $ / shares	2.47
Forfeited / Cancelled \| $ / shares	3.53
Ending balance \| $ / shares	2.98
Vested and exercisable at end of period \| $ / shares	$ 2.71
Weighted Average Remaining Contractual Term (in years)
Outstanding at end of period	8 years
Vested and exercisable at end of period	6 years 10 months 24 days
Aggregate Intrinsic Value
Outstanding at end of period \| $	$ 3,430,245
Vested and exercisable at end of period \| $	$ 2,944,999

Fair Value of Stock Options Weighted-Average Assumptions Used (Detail) - $ / shares	6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk-free interest rate	0.40%	1.80%
Expected life (years)	6 years	6 years
Expected volatility	80.80%	73.50%
Dividend yield	0.00%	0.00%
Weighted-average grant date fair value	$ 2.30	$ 1.60