0000950170-23-020829 | 10-Q | XBRL Viewer

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Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2023	Apr. 28, 2023
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Entity Registrant Name	PEPGEN INC.
Entity Central Index Key	0001835597
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		23,782,297
Entity Shell Company	false
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Title of 12(b) Security	Common stock, par value $0.0001 per share
Trading Symbol	PEPG
Security Exchange Name	NASDAQ
Entity File Number	001-41374
Entity Tax Identification Number	85-3819886
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	245 Main Street
Entity Address, City or Town	Cambridge
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02142
City Area Code	781
Local Phone Number	797-0979
Document Quarterly Report	true
Document Transition Report	false

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 165,403	$ 181,752
Prepaid expenses and other current assets	3,067	4,331
Total current assets	168,470	186,083
Property and equipment, net	5,339	3,335
Operating lease right-of-use asset	25,759	26,549
Other assets	1,473	1,473
Total assets	201,041	217,440
Current liabilities:
Accounts payable	1,472	1,362
Accrued expenses	12,900	11,913
Operating lease liability	3,655	5,553
Total current liabilities	18,027	18,828
Operating lease liability, net of current portion	18,171	18,981
Total liabilities	36,198	37,809
Commitments and contingencies (Note 8)
Stockholders' equity:
Preferred Stock
Common stock	2	2
Additional paid-in capital	284,044	282,566
Accumulated other comprehensive (loss)	(28)	(81)
Accumulated deficit	(119,175)	(102,856)
Total stockholders' equity	164,843	179,631
Total liabilities and stockholders' equity	$ 201,041	$ 217,440

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Operating Expenses [Abstract]
Research and development	$ 14,360	$ 10,707
General and administrative	3,671	3,186
Total operating expenses	18,031	13,893
Operating loss	(18,031)	(13,893)
Other income (expense)
Interest income	1,792	9
Other income (expense), net	(80)	58
Total other income (expense), net	1,712	67
Net loss before income tax	(16,319)	(13,826)
Income tax expense		(4,420)
Net loss	$ (16,319)	$ (18,246)
Net loss per share, basic	$ (0.69)	$ (18.94)
Net loss per share, diluted	$ (0.69)	$ (18.94)
Weighted-average common shares outstanding, basic	23,761,915	963,588
Weighted-average common shares outstanding, diluted	23,761,915	963,588

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Statement of Comprehensive Income [Abstract]
Net loss	$ (16,319)	$ (18,246)
Cumulative translation adjustment during the period	53	(74)
Comprehensive loss	$ (16,266)	$ (18,320)

- Definition

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

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CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' DEFICIT (UNAUDITED) - USD ($) $ in Thousands	Total	Series A-1 Convertible Preferred Stock	Series A-2 Convertible Preferred Stock	Series B Convertible Preferred Stock	Common Stock Class A Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive (Loss) Income	Accumulated Deficit
Temporary Equity Beginning Balance at Dec. 31, 2021		$ 8,454	$ 44,639	$ 112,083
Temporary Equity Beginning Balance, shares at Dec. 31, 2021		1,372,970	3,939,069	7,234,766
Beginning Balance at Dec. 31, 2021	$ (32,082)					$ 1,653	$ 17	$ (33,752)
Beginning Balance, shares at Dec. 31, 2021					963,588
Stock-based compensation expense	815					815
Net loss	(18,246)							(18,246)
Foreign currency translation adjustment	(74)						(74)
Temporary Equity Ending Balance at Mar. 31, 2022		$ 8,454	$ 44,639	$ 112,083
Temporary Equity Ending Balance, shares at Mar. 31, 2022		1,372,970	3,939,069	7,234,766
Ending Balance at Mar. 31, 2022	(49,587)					2,468	(57)	(51,998)
Ending Balance, shares at Mar. 31, 2022					963,588
Beginning Balance at Dec. 31, 2022	179,631				$ 2	282,566	(81)	(102,856)
Beginning Balance, shares at Dec. 31, 2022					23,713,196
Stock-based compensation expense	1,348					1,348
Exercise of stock options	130					130
Exercise of stock options, Shares					68,709
Net loss	(16,319)							(16,319)
Foreign currency translation adjustment	53						53
Ending Balance at Mar. 31, 2023	$ 164,843				$ 2	$ 284,044	$ (28)	$ (119,175)
Ending Balance, shares at Mar. 31, 2023					23,781,905

- Definition

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

+ References

+ 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.

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- Definition

Carrying amount, attributable to parent, of an entity's issued and outstanding stock which is not included within permanent equity. Temporary equity is a security with redemption features that are outside the control of the issuer, is not classified as an asset or liability in conformity with GAAP, and is not mandatorily redeemable. Includes any type of security that is redeemable at a fixed or determinable price or on a fixed or determinable date or dates, is redeemable at the option of the holder, or has conditions for redemption which are not solely within the control of the issuer. Includes stock with a put option held by an ESOP and stock redeemable by a holder only in the event of a change in control of the issuer.

+ References + Details

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows from operating activities:
Net loss	$ (16,319)	$ (18,246)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation	150	66
Stock-based compensation expense	1,348	815
Change in fair value of preferred stock warrant liability		(58)
Amortization and interest accretion related to operating leases	37
Changes in operating assets and liabilities:
Other receivables		21
Prepaids and other current and non-current assets	1,267	282
Accounts payable	(120)	(1,604)
Accrued expenses and other non-current liabilities	166	6,452
Operating lease liabilities, current and non-current	(1,951)
Net cash used in operating activities	(15,422)	(12,272)
Cash flows from investing activities:
Purchases of property and equipment	(1,181)	(1,614)
Net cash used in investing activities	(1,181)	(1,614)
Cash flows from financing activities:
Payment of deferred offering costs		(18)
Proceeds from employee equity plans	130
Net cash used in financing activities	130	(18)
Effect of exchange rate changes on cash	124	(137)
Net decrease in cash, cash equivalents and restricted cash	(16,349)	(14,041)
Cash, cash equivalents and restricted cash at beginning of period	183,225	134,368
Cash, cash equivalents and restricted cash at end of period	166,876	120,327
Components of cash, cash equivalents and restricted cash
Cash and cash equivalents	165,403	118,854
Restricted Cash	1,473	1,473
Supplemental noncash investing and financing activities
Property and equipment included in accounts payable and accrued expenses	$ 974	399
Deferred offering costs in accounts payable and accrued expenses		$ 766

Nature of Business and Basis of Presentation

3 Months Ended

Mar. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of Business and Basis of Presentation

1. Nature of Business and Basis of Presentation

PepGen Inc., or the Company or PepGen, headquartered in Boston, Massachusetts, is a biopharmaceutical company developing a transformative oligonucleotide delivery technology and pipeline of product candidates to treat neuromuscular and neurologic diseases with a high unmet medical need.

Initial Public Offering

On May 10, 2022, the Company closed its initial public offering (IPO) in which the Company sold an aggregate of 9,000,000 shares at a public offering price of $12.00 per share for gross proceeds of $108.0 million. In connection with the IPO, the Company granted the underwriters a 30-day option to purchase 1,350,000 additional shares of common stock. On May 16, 2022, the underwriters exercised the option in part and the Company issued 1,238,951 shares of common stock for gross proceeds of $14.9 million. From the IPO and option exercise by the underwriters, the Company received approximately $122.9 million in gross proceeds and $110.2 million in net proceeds, after deducting underwriting discounts and offering expenses payable by the Company.

Immediately prior to consummation of the IPO, all 12,546,805 outstanding shares of the Company’s redeemable convertible preferred stock, and 35,529 preferred stock warrants that were exercised on May 4, 2022 (see Note 3), converted into 12,359,856 shares of the Company’s common stock. As a result of this conversion, the Company's net loss per share, basic and diluted, will be significantly different from future filings.

Liquidity and Capital Resources

Since inception, the Company has not generated any revenue from product sales or other sources and has incurred significant operating losses and negative cash flows from operations. The Company’s primary uses of cash and cash equivalents to date have been to fund research and development activities, business planning, establishing and maintaining the Company’s intellectual property portfolio, hiring personnel, leasing premises and associated capital expenditures, raising capital, and providing general and administrative support for these operations. As of March 31, 2023, the Company had an accumulated deficit of $119.2 million. To date, the Company has funded operations primarily through private placements of convertible preferred stock and its IPO. As of March 31, 2023, the Company had cash and cash equivalents of $165.4 million. Based on its current operating plans, the Company believes that its cash and cash equivalents as of March 31, 2023, will be sufficient to fund its currently planned operations for at least the next 12 months from the filing of these condensed consolidated financial statements.

As the Company continues to pursue its business plan to successfully develop and obtain regulatory approval for the Company’s product candidates, it expects to finance its operations through the sale of equity, debt financings or other capital resources, which could include income from collaborations, strategic partnerships or marketing, distribution, licensing or other strategic arrangements with third parties, or from grants. However, there can be no assurance that any additional financing or strategic transactions will be available to the Company on acceptable terms, if at all. If events or circumstances occur such that the Company does not obtain additional funding, it may need to delay, reduce or eliminate its product development or future commercialization efforts, which could have a material adverse effect on the Company’s business, results of operations or financial condition.

Basis of Presentation and Consolidation

The accompanying condensed consolidated financial statements are unaudited and have been prepared in conformity with generally accepted accounting principles in the United States of America (GAAP). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (ASC) and Accounting Standards Update (ASU) of the Financial Accounting Standards Board (FASB). The condensed consolidated financial statements have been prepared on the same basis as the audited annual financial statements. Certain information and footnote disclosures normally included in the Company’s annual financial statements have been condensed or omitted. These condensed consolidated financial statements, in the opinion of management, reflect all normal recurring adjustments necessary for a fair presentation of the Company’s financial position as of March 31, 2023, and results of operations for the interim periods ended March 31, 2023 and March 31, 2022.

The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year. These condensed consolidated financial statements should be read in conjunction with the audited financial statements as of and for the years ended December 31, 2022 and 2021, and the notes thereto, included in the Company’s Annual Report, filed with the Securities and Exchange Commission (the SEC) on March 23, 2023, or Form 10-K.

Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2023

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

The Company’s significant accounting policies are disclosed in the audited financial statements for the year ended December 31, 2022 included in the Form 10-K. Since the date of those financial statements, there have been no changes to the Company’s significant accounting policies.

Concentration of Credit Risk

Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash and money market accounts. As of March 31, 2023, the Company’s cash and money market accounts were held by four financial institutions in the U.S. and one financial institution in the U.K. At times, the Company’s deposits held in the U.S. and U.K. may exceed the respective insured limits of the Federal Depository Insurance Corporation and Financial Services Compensation Scheme.

Deferred Offering Costs

The Company capitalizes within other long-term assets certain legal, accounting, and other third- party fees that are directly related to the Company’s in-process equity financings, until such financings are consummated. After consummation of the equity financing, these costs are recorded as a reduction of the proceeds received as a result of the offering. Should a planned equity financing be abandoned, terminated, or significantly delayed, the deferred offering costs are immediately written off to operating expenses. As of March 31, 2022, deferred offering costs of $2.2 million were recorded within other assets on the consolidated balance sheets. Subsequent to the completion of the IPO in May 2022, deferred offering costs totaling $4.1 million were recorded within stockholders’ equity (deficit) as a reduction of additional paid-in-capital generated from the initial public offering.

Income Taxes

Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts or existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period of enactment. The Company records a valuation allowance to reduce deferred tax assets to an amount for which realization is more likely than not.

The Company recognizes the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained upon examination by the tax authorities, based on the merits of the position. The Company’s policy is to recognize interest and penalties related to the underpayment of income taxes as a component of income tax expense or benefit. To date, there have been no interest or penalties charged in relation to the unrecognized tax benefits.

Restricted Cash

The Company classifies all cash whose use is limited by contractual provisions as restricted cash. Restricted cash arises from the requirement for the Company to maintain cash of $1.5 million as collateral under a lease agreement. As of March 31, 2023 and December 31, 2022, the Company had $1.5 million of restricted cash classified in other assets on the condensed consolidated balance sheets.

Fair Value Measurements

3 Months Ended

Mar. 31, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

3. Fair Value Measurements

The following tables (in thousands) present information about the Company’s financial assets that have been measured at fair value as of March 31, 2023 and December 31, 2022, and indicate the fair value of the hierarchy of the valuation inputs utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair value determined by Level 2 inputs utilize observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted market 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 related assets or liabilities. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability.


	As of March 31, 2023
	Total		Level 1		Level 2		Level 3
US Treasury-backed money market funds	$	131,727	$	131,727	$	—	$	—
Total	$	131,727	$	131,727	$	—	$	—


	As of December 31, 2022
	Total		Level 1		Level 2		Level 3
US Treasury-backed money market funds	$	18,645	$	18,645	$	—	$	—
Total	$	18,645	$	18,645	$	—	$	—

Money market funds are highly liquid investments that are valued based on quoted market prices in active markets, which represent a Level 1 measurement within the fair value hierarchy.

Preferred stock warrant liability

In connection with the November 24, 2020 Stock Purchase Agreement (Note 8), the Company granted warrants to purchase up to 35,529 shares of Series A-2 convertible preferred stock at a price per share equal to $11.42 and with a term ending upon the earlier of an underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, the consummation of a Deemed Liquidation Event, as such term is defined in the Company’s Restated Certificate of Incorporation or 10 years. As the warrants are for preferred stock, which do not qualify for equity classification, the warrants were recorded as a liability and were required to be remeasured to fair value at each reporting date. The warrants were exercised on May 4, 2022, just prior to the completion of the IPO, for proceeds of $0.4 million. Immediately prior to the consummation of the IPO, the warrants were converted into 34,901 shares of the Company's common stock.

As there are a number of inputs that are not observable in the market, the warrant valuation represented a Level 3 measurement within the fair value hierarchy. The Company’s valuation of the preferred stock warrant utilized the Black-Scholes option-pricing model, which incorporates assumptions and estimates to value the preferred stock warrant.

The quantitative elements associated with the Company’s Level 3 inputs impacting the fair value measurement of the preferred stock warrant liability included the fair value per share of the underlying Series A-2 convertible preferred stock, the remaining contractual term of the warrant, risk-free interest rate, expected dividend yield and expected volatility of the price of the underlying preferred stock. The most significant assumption in the Black-Scholes option-pricing model impacting the fair value of the preferred stock warrant was the fair value of the Company’s Series A-2 convertible preferred stock as of each remeasurement date. The Company determined the fair value per share of the underlying preferred stock by taking into consideration its most recent sales of its convertible preferred stock. The Company historically had been a private company and lacked company-specific historical and implied volatility information of its stock. Therefore, it estimated its expected stock volatility based on the historical volatility of publicly traded peer companies for a term equal to the remaining contractual term of the warrant. The risk-free interest rate was determined by reference to the U.S. Treasury yield curve for time periods approximately equal to the remaining contractual term of the warrant. The Company had estimated a 0% dividend yield based on the expected dividend yield and the fact that the Company has never paid or declared dividends.

The Company recognized changes in the fair value of the warrant liability as a component of other income (expense) in its consolidated statements of operations and comprehensive loss.

A reconciliation of the Level 3 warrant liability through exercise in the second quarter of 2022 is as follows (in thousands):


	Series A-2 Preferred Stock Warrant Liability
Balance as of December 31, 2021	$	226
Change in fair value		(58	)
Balance as of March 31, 2022	$	168

Immediately prior to consummation of the IPO, all 35,529 preferred stock warrants that were exercised on May 4, 2022, converted into 34,901 shares of the Company’s common stock. As such, there is no activity during the three-months ended March 31, 2023.

- 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

Property and Equipment, Net

3 Months Ended

Mar. 31, 2023

Property, Plant and Equipment [Abstract]

Property and Equipment, Net

4. Property and Equipment, Net

The cost and accumulated depreciation of property and equipment were as follows (in thousands):


	March 31, 2023			December 31, 2022
Lab equipment	$	4,671		$	2,424
Computer and office equipment		1,152			171
Construction in process	56				1,129
Total property and equipment	$	5,879		$	3,724
Less: accumulated depreciation		(540	)		(389	)
Total property and equipment, net	$	5,339		$	3,335

Depreciation expense was $0.2 million and $0.1 million for the three months ended March 31, 2023 and March 31, 2022, respectively.

Accrued Expenses

3 Months Ended

Mar. 31, 2023

Accrued Liabilities, Current [Abstract]

Accrued Expenses

5. Accrued Expenses

Accrued expenses consisted of the following (in thousands):


	March 31, 2023		December 31, 2022
Research and development expenses	$	6,957	$	4,840
Employee-related expenses	735			2,440
Taxes payable		3,339		3,248
Other		1,869		1,385
Total accrued expenses	$	12,900	$	11,913

Leases

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

Leases

6. Leases

In December 2021 the Company entered into a non-cancellable operating lease agreement, as amended subsequently, or the Harrison Lease, pursuant to which the Company leases 31,668 square feet of office and laboratory space located in Boston, Massachusetts, or the Premises. The Harrison Lease commenced for accounting purposes when the Company gained access to the premises on December 29, 2022 or the Lease Commencement Date. The Harrison Lease has a term of nine years and four months from the lease commencement date. The Company’s obligation for the payment of base rent for the Premises begins in May 2023, and will be $0.2 million per month, increasing up to $0.3 million per month during the term of the Lease. The Company has one option to extend the term of the Harrison Lease, for a period of an additional five years. Due to the timing of the lease commencement date at the end of 2022, there was no fixed lease rent expense associated with the Harrison Lease in 2022. As of March 31, 2023, the Harrison Lease was the only lease for which the Company recorded a lease liability and corresponding right-of-use asset.

The landlord has completed and continues to complete significant leasehold improvements to the leased space, a portion of which the Company is obligated to pay per the terms of the Harrison Lease. The Company paid $2.0 million for the improvements prior to lease commencement. During the three months ended March 31, 2023, the Company paid $2.9 million for the improvements and expects approximately $0.9 million in additional payments for the improvements. The Company has determined that the landlord is the accounting owner of the improvements, and expected payments by the Company for the improvements have been included in the calculation of the right-of-use asset and lease liability.

On January 14, 2022, the Company entered into a First Amendment to the Harrison Lease, which updated the Company's pro rata share of the building premises. On March 27, 2023, the Company entered into a Second Amendment to the Harrison Lease by which the term of the Harrison Lease was extended by two months until May 2032. The Company recorded a $0.3 million reduction to the lease asset and liability during the period to account for this amendment.

During 2022 and the first quarter of 2023, the Company leased office space in Cambridge, Massachusetts, the terms of which were month-to-month, with a 30-day written notice of cancellation. The Company terminated this lease in January 2023. The

Company also leased laboratory space at the University of Massachusetts, Mount Ida Campus in Newton, Massachusetts, with an initial lease term from February 1, 2022 to January 31, 2023, which the Company extended until March 2023. The Company also leased space at Innovation Building, University of Oxford in Oxford, United Kingdom. The Company terminated its lease in Oxford in July 2022. All of these leases had terms of under 12 months and are considered short-term lease costs and are not recognized on the consolidated balance sheets.

Summary of lease costs

The components of lease cost under ASC 842 for the leases were as follows (in thousands):


	March 31, 2023		March 31, 2022
Fixed lease cost	$	973	$	—
Variable lease cost		64		—
Short-term lease cost		204		317
Total lease cost	$	1,241	$	317

Supplemental disclosure of cash flow information under ASC 842 for the leases follows (in thousands):


	March 31, 2023
Operating cash payments for operating leases	$	2,887

Cash payments for operating leases during the three months ended March 31, 2023 related to landlord-owned improvements made to the office and lab space prior to the Company obtaining occupancy. These payments were recorded in the right-of-use asset at December 31, 2022.

The remaining lease term for the Harrison Lease is 9.1 years, and the discount rate is 8.0%.

Future minimum lease payments under the non-cancelable operating leases consisted of the following as of March 31, 2023:


Year Ending December 31,	(in thousands)
2023 (April - December)	$	2,912
2024		3,019
2025		3,109
2026		3,202
2027		3,299
Thereafter		15,458
Total future minimum lease payments	$	30,999
Less: imputed interest		(9,173	)
Present value of lease liability	$	21,826

Included in the consolidated balance sheet (in thousands)	March 31, 2023
Lease liability	$	3,655
Lease liability, net of current portion		18,171
Total lease liability	$	21,826

Related Party Transactions

3 Months Ended

Mar. 31, 2023

Related Party Transactions

7. Related Party Transactions

Technology license agreement

In March 2018, the Company, Oxford University Innovation Limited (OUI), and the Medical Research Council of United Kingdom Research and Innovation, or MRC (or collectively the Licensors), entered into a license of technology agreement, or the License Agreement, which was subsequently amended in December 2018 and further amended and restated in November 2020. The Licensors and affiliates hold shares of the Company's common stock. The License Agreement provides the Company with an exclusive world-wide license to licensed data and technology owned by OUI and MRC in respect of cell penetrating peptides for treatment of Duchenne muscular dystrophy, spinal muscular atrophy, and other conditions. The License Agreement provides the Company with the rights to grant and authorize sublicenses to make, use, sell, and import products and otherwise exploit the patent rights.

As consideration for the license, the Company made an initial upfront payment in 2018 of $0.1 million upon transfer of the license technology and data and in 2020 upon amending and restating the License Agreement made two additional payments of $19,000 each for a Restatement Completion Fee and License Data Fee. The Company determined that the upfront payment and subsequent Restatement Completion Fee and License Data Fee as part of the license agreement would be expensed upon execution of the original contract and subsequent amendment as the license was acquired for research and development purposes which does not have alternative future uses, and the underlying technology has not reached technological feasibility.

The Company could be required to make milestone payments to the Licensors upon completion of certain patent and commercial milestones related to the patents and commercialization of certain of the Company’s product candidates. The aggregate potential milestone payments are $0.1 million. The Company also agreed to pay the Licensors low single digit royalties on net sales of any licensed products that are commercialized by the Company or sublicensees in excess of a threshold amount between £20 million and £30 million ($24.7 million and $37.0 million as of March 31, 2023), subject to certain adjustments. The term of the License Agreement continues until the later of (i) the date on which all the patents and patent applications covered thereunder have been abandoned or allowed to lapse or expired or been rejected or revoked or (ii) 20 years from the date of the original agreement.

Upon completion of the Company’s IPO in May 2022, the Company became obligated to pay OUI an exit fee between 0.5% to 2% of the value determined in an acquisition or initial public offering, not to exceed £5 million ($6.2 million as of the IPO date). The exit fee due to OUI, based on the IPO raise, was $1.4 million, which was paid during the second quarter of 2022 and included in research and development expense on the consolidated statement of operations.

Additionally, the Company paid office space rent to OUI through the termination of the lease in July 2022. For the three months ended March 31, 2023 and March 31, 2022, total rent payments were not material. As of March 31, 2023 and December 31, 2022, nil was due to OUI by the Company for rent payments.

Services agreement

In November 2020, the Company entered into an agreement, or the Services Agreement, with Carnot Pharma, LLC, or Carnot, under which Carnot provides research and other services to the Company. Carnot is an entity controlled by RA Capital Management, L.P. Entities affiliated with RA Capital Management, L.P. purchased shares of Series A-2 convertible preferred stock in the Company’s preferred stock financing in November of 2020 and May and July of 2021, which were converted to shares of the Company's common stock in connection with the IPO. In addition, entities affiliated with RA Capital Management, L.P. purchased shares of our Series B convertible preferred stock in the Company’s preferred stock financing in July 2021 which were also converted into shares of the Company's common stock in connection with the IPO, and purchased our common stock in the IPO. At the time the Services Agreement was entered into, one member of the Company’s Board of Directors was affiliated with RA Capital Management, L.P., and currently two members of the Company’s Board of Directors are affiliated with R.A. Capital Management, L.P.

Under the terms of the Services Agreement, the Company compensates Carnot on a fully burdened cost basis for personal time devoted to Company projects. In addition, the Company reimburses Carnot on a costs basis for any subcontractor costs incurred. The Company pays Carnot on a quarterly basis, in arrears, for services performed and costs incurred. The Services Agreement is for a term of the later of (A) two (2) years and (B) the later of (a) completion of the Services or (b) latest-to-occur delivery of a final report or any other items required to be delivered to the Company under the last ongoing project as part of the services, if any. The Company may terminate the services agreement by giving 30 days’ prior notice and either party can terminate the services agreement for a material breach, if not cured within 30 days following notice by the nonbreaching party. The Services Agreement was terminated on April 15, 2022.

Expenses incurred by the Company under the Services Agreement with Carnot for the three months ended March 31, 2023 and March 31, 2022, were nil and $43,000, respectively. As of March 31, 2023 and December 31, 2022, the amounts included in accounts payable related to the Services Agreement and owing to Carnot by the Company were nil, respectively.

Commitments and Contingencies

3 Months Ended

Mar. 31, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

8. Commitments and Contingencies

Legal proceedings

From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of its business activities. The Company accrues a liability for such matters when it is probable that future expenditures will be made and that such expenditures can be reasonably estimated.

The Company is not party to any litigation and does not have contingency reserves established for any litigation liabilities.

Other

The Company enters into standard indemnification agreements in the ordinary course of business. Pursuant to the agreements, the Company agrees to indemnify, hold harmless, and to reimburse the indemnified party for losses suffered or incurred by the indemnified party, including in connection with any U.S. patent or any copyright or other intellectual property infringement claim by any third-party with respect to the Company’s products. Further, the Company indemnifies its directors and officers who are, or were, serving at the Company’s request in such capacities. The Company’s maximum exposure under these arrangements is unknown as of March 31, 2023. The Company does not anticipate recognizing any significant losses relating to these arrangements. The term of these indemnification agreements is generally perpetual any time after execution of the agreement. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements may be unlimited. The Company has never incurred costs to defend lawsuits or settle claims related to these indemnification agreements.

Convertible Preferred Stock and Stockholders' Equity

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Convertible Preferred Stock and Stockholders' Equity

9. Convertible Preferred Stock and Stockholders’ Equity

Reverse Stock Split

On April 29, 2022, the Company filed a charter amendment to effect a 1.018 for 1 reverse stock split of its issued and outstanding shares of common stock, which resulted in a proportional adjustment to the existing conversion ratios for each series of the Company’s preferred stock. Accordingly, all share and per share amounts for all periods presented in the accompanying consolidated financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect this reverse stock split and adjustment of the preferred stock conversion ratios.

Series A-1 convertible preferred stock and Series A-2 convertible preferred stock

In connection with the November 24, 2020 Stock Purchase Agreement, the Company agreed to issue an aggregate of 3,939,069 shares of Series A-2 convertible preferred stock to new and existing investors at a price of $11.42 per share, in three closings, and elected to convert 1,348,693 shares of outstanding Class A and Class B common stock into 1,372,970 shares of Series A-1 convertible preferred stock. A total of 1,033,117 shares of Class A common stock held by certain founding investors and employees were not modified and continue to exist as Class A common stock. The Series A-1 and Series A-2 convertible preferred stock was converted to common stock immediately prior to the consummation of the Company’s IPO in May 2022 (see Note 1).

Series B convertible preferred stock

In July 2021 the Company entered into the Series B Stock Purchase Agreement, whereby the Company agreed to issue and sold an aggregate of 7,234,766 shares of Series B convertible stock to new and existing investors at a per share price of $15.55 per share for aggregate gross proceeds of $112.5 million. The Series B convertible preferred stock was converted to common stock immediately prior to the consummation of the Company's IPO in May 2022 (see Note 1).

Common stock

Under the Third Amended and Restated Certificate of Incorporation, dated May 10, 2022, as currently in effect, the Company has the authority to issue a total of 500,000,000 shares of common stock (par value of $0.0001 per share) and 10,000,000 shares of undesignated preferred stock (par value of $0.0001 per share). In connection with the IPO, the Company re-designated all shares of Class A common stock as shares of common stock. Each share of common stock has the right to one vote. The holders of common stock are also entitled to receive dividends whenever funds are legally available and when declared by the board of directors, subject to the prior rights of holders of all classes of stock outstanding having priority rights as to dividends. No cash dividends have been declared by the board of directors during the three months ended March 31, 2023 and March 31, 2022.

The Company has reserved the following shares of common stock for issuance, on an as-converted basis, as follows:


	March 31, 2023		December 31, 2022
Stock options issued and outstanding		4,307,894		3,341,834
Authorized for future stock awards or option grants		1,051,961		901,462
Authorized for future issuance under employee stock purchase plan		226,000		226,000
Total		5,585,855		4,469,296

Shares of Common Stock Subject to Repurchase

In November 2020, in connection with the Series A-2 convertible preferred stock financing, two founding stockholders entered into Stock Restriction Agreements, or Restriction Agreements, whereby 139,057 shares that were previously vested and not subject to repurchase became restricted and subject to repurchase. The repurchase rights lapse 50% on the one-year anniversary of the Restriction Agreements and 50% on the second anniversary of the Restriction Agreements. Shares subject to repurchase by the Company are not deemed, for accounting purposes, to be outstanding until those shares vest and therefore are not included in the shares outstanding on the condensed consolidated balance sheet.

In connection with the vesting restrictions placed on these previously vested shares, the Company was required to determine the measurement date fair value of the shares, which was $2.37 per share or $0.3 million in aggregate. The measurement date fair value of the restricted stock will be recognized as stock-based compensation expense over the vesting period. The final shares subject to restriction were released in November 2022, and as of March 31, 2023 and December 31, 2022, zero shares of restricted stock were subject to repurchase by the Company, respectively.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

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-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 50
-Paragraph 6
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126731327&loc=SL126733271-114008

+ Details

Stock-Based Compensation

3 Months Ended

Mar. 31, 2023

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

10. Stock-Based Compensation

The Company maintains three equity compensation plans; the 2020 Stock Plan, or the 2020 Plan, the 2022 Stock Option Incentive Plan, or the 2022 Plan, and the 2022 Employee Stock Purchase Plan, or the ESPP. The number of shares of common stock that may be issued under the 2022 Plan is subject to increase by the number of shares forfeited under any options forfeited and not exercised under the 2020 Plan. Additionally, the number of shares reserved for issuance under the 2022 Plan automatically increases on the first day of each fiscal year in an amount equal to the lower of (1) 5% of the shares of common stock outstanding on such date and (2) an amount determined by the Company’s board of directors. The board of directors has determined not to make any further awards under the 2020 Plan. On January 1, 2023, an additional 1,185,660 shares were added to the 2022 Plan as a result of the evergreen provision. As of March 31, 2023, 1,051,961 shares remained available for grant under the 2022 Plan and 226,000 shares remained available for issuance under the ESPP.

Stock Option Activity

Stock option activity under the 2020 Plan and the 2022 Plan, is as follows:


	Stock Options			Weighted-Average Exercise Price
Outstanding as of December 31, 2022		3,341,834		$	9.52
Granted		1,116,850			15.26
Exercised		(68,709	)		1.80
Canceled/Forfeited		(81,689	)		11.55
Outstanding as of March 31, 2023		4,308,286		$	11.09
Vested and exercisable as of March 31, 2023		768,160		$	7.30
Vested and expected to vest as of March 31, 2023		4,308,286		$	11.09

The weighted-average grant date fair value of options granted during the three months ended March 31, 2023 was $9.52 per share.

Stock-Based Compensation Expense

Stock based compensation expense recognized for stock option grants included in the accompanying condensed consolidated statements of operations and comprehensive loss is as follows (in thousands):


	Three Months Ended March 31,
	2023		2022
Research and development	$	600	$	256
General and administrative		748		559
Total stock-based compensation expense	$	1,348	$	815

The Company had 4,308,286 unvested stock options outstanding as of March 31, 2023. As of March 31, 2023, total unrecognized compensation cost related to stock options was $24.9 million. This amount is expected to be recognized over a weighted average period of approximately 3.08 years.

Income Taxes

3 Months Ended

Mar. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

11. Income Taxes

The Company recorded income tax expense of nil and $4.4 million for the three months ended March 31, 2023 and 2022, respectively. The income tax expense for the three months ended March 31, 2022 was due to the intellectual property (IP) transfer noted in the paragraph below.

On January 1, 2022, or the Transfer Date, the Company’s wholly owned subsidiary, PepGen Limited, transferred all IP assets to the parent company, PepGen Inc., in an arm’s length transaction at fair value pursuant to an asset transfer agreement. The fair value of the IP assets is a non-recurring fair value measurement. The Company engaged valuation specialists to calculate the IP value, and the IP value was measured using the historical cost method. The historical cost method estimated the fair value of the IP assets using the historical cost base of the IP assets and the expected market return as of the Transfer Date. The significant assumption inherent in estimating the fair value using the historical cost method was the expected market return. The Company utilized a 40% expected market return, which a third-party investor may expect as a return on their investment, and which is based on studies of venture capital investment returns. The Company calculated the fair value of the IP assets by computing the present value of the historical cost base using the 40% expected market return. The assumptions used in the estimation of the IP assets represent level 3 inputs of the fair value hierarchy (see Note 3).

The Company recognizes the impact of an uncertain income tax position taken on its income tax returns at the amount that is more likely than not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will be recognized if it has less than a 50% likelihood of being sustained. The tax positions are analyzed at least quarterly, and adjustments are made as events occur that warrant adjustments for those positions. As of March 31, 2023, the Company has a liability for the uncertain tax position relative to the IP transfer of $0.7 million recorded.

The transfer of the intellectual property assets resulted in an estimated tax charge during the three months ended March 31, 2022 to His Majesty’s Revenue & Customs, after considering net operating loss carryforwards, of $4.4 million, inclusive of the $0.7 million uncertain tax position. The Company maintains a tax liability of $3.3 million as of March 31, 2023 related to the estimated tax charge which is accounted for in accrued expenses on the condensed consolidated balance sheet.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 17
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 14
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI https://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Summary of Significant Accounting Policies (Policies)	3 Months Ended
Summary of Significant Accounting Policies (Policies)	Mar. 31, 2023
Accounting Policies [Abstract]
Deferred Offering Costs	Deferred Offering Costs The Company capitalizes within other long-term assets certain legal, accounting, and other third- party fees that are directly related to the Company’s in-process equity financings, until such financings are consummated. After consummation of the equity financing, these costs are recorded as a reduction of the proceeds received as a result of the offering. Should a planned equity financing be abandoned, terminated, or significantly delayed, the deferred offering costs are immediately written off to operating expenses. As of March 31, 2022, deferred offering costs of $2.2 million were recorded within other assets on the consolidated balance sheets. Subsequent to the completion of the IPO in May 2022, deferred offering costs totaling $4.1 million were recorded within stockholders’ equity (deficit) as a reduction of additional paid-in-capital generated from the initial public offering.
Concentration of Credit Risk	Concentration of Credit Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash and money market accounts. As of March 31, 2023, the Company’s cash and money market accounts were held by four financial institutions in the U.S. and one financial institution in the U.K. At times, the Company’s deposits held in the U.S. and U.K. may exceed the respective insured limits of the Federal Depository Insurance Corporation and Financial Services Compensation Scheme.
Income Taxes	Income Taxes Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts or existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period of enactment. The Company records a valuation allowance to reduce deferred tax assets to an amount for which realization is more likely than not. The Company recognizes the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained upon examination by the tax authorities, based on the merits of the position. The Company’s policy is to recognize interest and penalties related to the underpayment of income taxes as a component of income tax expense or benefit. To date, there have been no interest or penalties charged in relation to the unrecognized tax benefits.
Restricted Cash	Restricted Cash The Company classifies all cash whose use is limited by contractual provisions as restricted cash. Restricted cash arises from the requirement for the Company to maintain cash of $1.5 million as collateral under a lease agreement. As of March 31, 2023 and December 31, 2022, the Company had $1.5 million of restricted cash classified in other assets on the condensed consolidated balance sheets.

- 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 + Details

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2023

Fair Value Disclosures [Abstract]

Summary of Fair Value of Financial Assets Measure at Fair Value on Recurring Basis


	As of March 31, 2023
	Total		Level 1		Level 2		Level 3
US Treasury-backed money market funds	$	131,727	$	131,727	$	—	$	—
Total	$	131,727	$	131,727	$	—	$	—


	As of December 31, 2022
	Total		Level 1		Level 2		Level 3
US Treasury-backed money market funds	$	18,645	$	18,645	$	—	$	—
Total	$	18,645	$	18,645	$	—	$	—

Summary of Reconciliation of Warrant Liabilities


	Series A-2 Preferred Stock Warrant Liability
Balance as of December 31, 2021	$	226
Change in fair value		(58	)
Balance as of March 31, 2022	$	168

Property and Equipment, Net (Tables)

3 Months Ended

Mar. 31, 2023

Property, Plant and Equipment [Abstract]

Summary of Cost and Accumulated Depreciation of Property and Equipment

The cost and accumulated depreciation of property and equipment were as follows (in thousands):


	March 31, 2023			December 31, 2022
Lab equipment	$	4,671		$	2,424
Computer and office equipment		1,152			171
Construction in process	56				1,129
Total property and equipment	$	5,879		$	3,724
Less: accumulated depreciation		(540	)		(389	)
Total property and equipment, net	$	5,339		$	3,335

Accrued Expenses (Tables)

3 Months Ended

Mar. 31, 2023

Accrued Liabilities, Current [Abstract]

Schedule of Accrued Expenses

Accrued expenses consisted of the following (in thousands):


	March 31, 2023		December 31, 2022
Research and development expenses	$	6,957	$	4,840
Employee-related expenses	735			2,440
Taxes payable		3,339		3,248
Other		1,869		1,385
Total accrued expenses	$	12,900	$	11,913

Leases (Tables)

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

Components of Lease Cost

The components of lease cost under ASC 842 for the leases were as follows (in thousands):


	March 31, 2023		March 31, 2022
Fixed lease cost	$	973	$	—
Variable lease cost		64		—
Short-term lease cost		204		317
Total lease cost	$	1,241	$	317

Supplemental Disclosure of Cash Flow Information Related to Leases

Supplemental disclosure of cash flow information under ASC 842 for the leases follows (in thousands):


	March 31, 2023
Operating cash payments for operating leases	$	2,887

Schedule of Future Minimum Lease Payments Under Non-cancelable Operating Leases

Future minimum lease payments under the non-cancelable operating leases consisted of the following as of March 31, 2023:


Year Ending December 31,	(in thousands)
2023 (April - December)	$	2,912
2024		3,019
2025		3,109
2026		3,202
2027		3,299
Thereafter		15,458
Total future minimum lease payments	$	30,999
Less: imputed interest		(9,173	)
Present value of lease liability	$	21,826

Included in the consolidated balance sheet (in thousands)	March 31, 2023
Lease liability	$	3,655
Lease liability, net of current portion		18,171
Total lease liability	$	21,826

Convertible Preferred Stock and Stockholders' Equity (Tables)

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

Schedule of Reserved Shares of Common Stock for Issuance, on an As-Converted Basis

The Company has reserved the following shares of common stock for issuance, on an as-converted basis, as follows:


	March 31, 2023		December 31, 2022
Stock options issued and outstanding		4,307,894		3,341,834
Authorized for future stock awards or option grants		1,051,961		901,462
Authorized for future issuance under employee stock purchase plan		226,000		226,000
Total		5,585,855		4,469,296

Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2023

Share-Based Payment Arrangement [Abstract]

Summary of Stock Options Activity

Stock option activity under the 2020 Plan and the 2022 Plan, is as follows:


	Stock Options			Weighted-Average Exercise Price
Outstanding as of December 31, 2022		3,341,834		$	9.52
Granted		1,116,850			15.26
Exercised		(68,709	)		1.80
Canceled/Forfeited		(81,689	)		11.55
Outstanding as of March 31, 2023		4,308,286		$	11.09
Vested and exercisable as of March 31, 2023		768,160		$	7.30
Vested and expected to vest as of March 31, 2023		4,308,286		$	11.09

Summary of Stock-based Compensation Expense

Stock based compensation expense recognized for stock option grants included in the accompanying condensed consolidated statements of operations and comprehensive loss is as follows (in thousands):


	Three Months Ended March 31,
	2023		2022
Research and development	$	600	$	256
General and administrative		748		559
Total stock-based compensation expense	$	1,348	$	815

Nature of Business and Basis of Presentation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands				3 Months Ended
	May 16, 2022	May 10, 2022	Apr. 29, 2022	Mar. 31, 2023	Dec. 31, 2022	May 04, 2022	Mar. 31, 2022
Subsidiary, Sale of Stock [Line Items]
Received from IPO and option exercise by underwriters				$ 122,900
Net Received from IPO and option exercise by underwriters				110,200
Reverse stock split, description			1.018 for 1 reverse stock split
Accumulated deficit				119,175	$ 102,856
Cash and cash equivalents				$ 165,403	$ 181,752		$ 118,854
Common stock
Subsidiary, Sale of Stock [Line Items]
Common stock issued in connection with exercise of stock options	1,238,951
Gross proceeds from underwriters exercised option	$ 14,900
IPO
Subsidiary, Sale of Stock [Line Items]
Number of shares sold		9,000,000
Public offering price per share		$ 12.00
Gross proceeds from sale of shares		$ 108,000
Shares issued upon conversion of redeemable convertible preferred stock						12,359,856
Preferred stock warrants exercised						35,529
IPO \| Redeemable Convertible Preferred Stock
Subsidiary, Sale of Stock [Line Items]
Outstanding shares						12,546,805
IPO \| Common stock
Subsidiary, Sale of Stock [Line Items]
Option to purchase		1,350,000
Shares issued upon conversion of redeemable convertible preferred stock						34,901

Summary of Significant Accounting Policies (Additional Information) (Details) - USD ($)	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022	Mar. 31, 2022
Summary of Significant Accounting Policies [Line Items]
Deferred offering costs			$ 4,100,000
Cash	$ 1,500,000
Restricted cash	$ 1,500,000	$ 1,500,000
Restricted Cash, Noncurrent, Statement of Financial Position [Extensible Enumeration]	Other Assets, Noncurrent	Other Assets, Noncurrent
Unrecognized tax benefits, interest on income taxes expense	$ 0
Unrecognized tax benefits, income tax penalties	$ 0
Other Assets
Summary of Significant Accounting Policies [Line Items]
Deferred offering costs			$ 2,200,000

Fair Value Measurements - Summary of Fair Value of Financial Assets Measure at Fair Value on Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	$ 131,727	$ 18,645
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	131,727	18,645
US Treasury-Backed Money Market Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	131,727	18,645
US Treasury-Backed Money Market Funds \| Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	$ 131,727	$ 18,645

Fair Value Measurements - Additional Information (Details) $ / shares in Units, $ in Millions		3 Months Ended
	May 04, 2022 USD ($) shares	Mar. 31, 2023	Nov. 24, 2020 $ / shares shares
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Warrants term			10 years
Warrants exercised, date		May 04, 2022
IPO
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Number of warrants purchase granted	35,529
Proceeds from warrant exercises \| $	$ 0.4
Class of warrants or rights number of shares converted into common stock	34,901
Shares issued upon conversion of redeemable convertible preferred stock	12,359,856
IPO \| Common Stock
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Shares issued upon conversion of redeemable convertible preferred stock	34,901
Dividend Yield
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Expected dividend yield			0
Series A-2 Convertible Preferred Stock
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Number of warrants purchase granted			35,529
Preferred stock par value \| $ / shares			$ 11.42

Fair Value Measurements - Summary of Reconciliation of Warrant Liabilities (Details) - Series A-2 Preferred Stock Warrant Liability $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Beginning balance	$ 226
Change in fair value	(58)
Ending balance	$ 168

Property and Equipment, Net - Summary of Cost and Accumulated Depreciation of Property and Equipment (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 5,879	$ 3,724
Less: accumulated depreciation	(540)	(389)
Total property and equipment, net	5,339	3,335
Lab Equipment
Property, Plant and Equipment [Line Items]
Total property and equipment	4,671	2,424
Computer and Office Equipment
Property, Plant and Equipment [Line Items]
Total property and equipment	1,152	171
Construction in Process
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 56	$ 1,129

Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Property, Plant and Equipment [Abstract]
Depreciation expenses	$ 0.2	$ 0.1

Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Accrued Liabilities, Current [Abstract]
Research and development expenses	$ 6,957	$ 4,840
Employee-related expenses	735	2,440
Taxes payable	3,339	3,248
Other	1,869	1,385
Total accrued expenses	$ 12,900	$ 11,913

Leases - Additional Information (Details)		1 Months Ended	3 Months Ended	12 Months Ended
Leases - Additional Information (Details)	Dec. 28, 2022 USD ($)	Dec. 31, 2021 USD ($) ft²	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)
Lessee, Lease, Description [Line Items]
Lease, description			On March 27, 2023, the Company entered into a Second Amendment to the Harrison Lease by which the term of the Harrison Lease was extended by two months until May 2032
Operating lease cost improvements			$ 973,000
Reduction to the lease asset and liability			$ 300,000
Cambridge Massachusetts
Lessee, Lease, Description [Line Items]
Lease term					12 months
Lease, description					the Company leased office space in Cambridge, Massachusetts, the terms of which were month-to-month, with a 30-day written notice of cancellation
Lease termination term					the terms of which were month-to-month, with a 30-day written notice of cancellation
Lease, Existence of Option to Terminate [true false]					true
Lease terimation					2023-01
Newton, Massachusetts
Lessee, Lease, Description [Line Items]
Lease, description					The Company terminated this lease in January 2023. The Company also leased laboratory space at the University of Massachusetts, Mount Ida Campus in Newton, Massachusetts, with an initial lease term from February 1, 2022 to January 31, 2023, which the Company extended until March 2023.
Harrison Lease
Lessee, Lease, Description [Line Items]
Leased space \| ft²		31,668
Lease commencement date		Dec. 29, 2022
Lease term		9 years 4 months
Lease, description			The Company’s obligation for the payment of base rent for the Premises begins in May 2023, and will be $0.2 million per month, increasing up to $0.3 million per month during the term of the Lease. The Company has one option to extend the term of the Harrison Lease, for a period of an additional five years.
Monthly rent expense		$ 200,000
Increase in monthly rent expense		$ 300,000
Option to extend lease			The Company has one option to extend the term of the Harrison Lease, for a period of an additional five years.
Option to extend lease term			true
Additional period of lease		5 years
Fixed lease rent expense					$ 0
Remaining lease term			9 years 1 month 6 days
Lease discount rate			8.00%
Harrison Lease \| Leaseholds and Leasehold Improvements
Lessee, Lease, Description [Line Items]
Operating lease cost improvements	$ 2,000,000.0		$ 2,900,000
Harrison Lease \| Leaseholds and Leasehold Improvements \| Forecast
Lessee, Lease, Description [Line Items]
Operating lease cost improvements				$ 900,000

Leases - Summary of Components of Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Leases [Abstract]
Fixed lease cost	$ 973
Variable lease cost	64
Short-term lease cost	204	$ 317
Total lease cost	$ 1,241	$ 317

Leases - Summary of Supplemental Disclosure of Cash Flow Information Related to Leases (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($)
Leases [Abstract]
Operating cash payments for operating leases	$ 2,887

Leases - Schedule of Future Minimum Lease Payments under Non-Cancelable Operating Leases (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Leases [Abstract]
2023 (April - December)	$ 2,912
2024	3,019
2025	3,109
2026	3,202
2027	3,299
Thereafter	15,458
Total future minimum lease payments	30,999
Less: imputed interest	(9,173)
Present value of lease liability	21,826
Lease liability	3,655	$ 5,553
Lease liability, net of current portion	$ 18,171	$ 18,981

Related Party Transactions - Additional Information) (Details) € in Millions, £ in Millions			1 Months Ended		3 Months Ended
	May 31, 2022 EUR (€)	May 31, 2022 USD ($)	Nov. 30, 2020	Mar. 31, 2018 USD ($)	Mar. 31, 2023 GBP (£)	Mar. 31, 2023 USD ($)	Mar. 31, 2022 USD ($)	Dec. 31, 2022 USD ($)
Technology License Agreement
Related Party Transaction [Line Items]
Initial upfront payment				$ 100,000
Additional payments of restatement completion fee and license data fee						$ 19,000
Aggregate potential milestone payments						$ 100,000
Term of license agreement					20 years	20 years
Technology License Agreement \| Minimum
Related Party Transaction [Line Items]
Sublicensees threshold amount					£ 20	$ 24,700,000
Technology License Agreement \| Maximum
Related Party Transaction [Line Items]
Sublicensees threshold amount					£ 30	37,000,000.0
Technology License Agreement \| Oxford University Innovation Limited
Related Party Transaction [Line Items]
Rent payable to related parties						0		$ 0
Technology License Agreement \| Oxford University Innovation Limited \| IPO
Related Party Transaction [Line Items]
Required to pay exit fee amount						1,400,000
Technology License Agreement \| Oxford University Innovation Limited \| Minimum \| IPO
Related Party Transaction [Line Items]
Percentage of exit fee	0.50%	0.50%
Technology License Agreement \| Oxford University Innovation Limited \| Maximum \| IPO
Related Party Transaction [Line Items]
Percentage of exit fee	2.00%	2.00%
Required to pay exit fee amount	€ 5	$ 6,200,000
Services Agreement [Member] \| Carnot Pharma, LLC
Related Party Transaction [Line Items]
Term of services agreement			2 years
Services agreement terminate prior notice period			30 days
Services agreement terminated date			Apr. 15, 2022
Related party transaction expenses						0	$ 43,000
Due to related party for service rendered						$ 0		$ 0

Convertible Preferred Stock and Stockholders' Equity - Additional Information (Details)			1 Months Ended		3 Months Ended
	Apr. 29, 2022	Nov. 24, 2020 $ / shares shares	Jul. 31, 2021 USD ($) $ / shares shares	Nov. 30, 2020 USD ($) Stockholder $ / shares shares	Mar. 31, 2023 USD ($) $ / shares shares	Mar. 31, 2022 USD ($)	Dec. 31, 2022 shares
Class of Stock [Line Items]
Reverse stock split, description	1.018 for 1 reverse stock split
Reverse stock split, conversion ratio	0.982
Common stock, shares authorized					500,000,000
Common stock, par value \| $ / shares					$ 0.0001
Cash dividend \| $					$ 0	$ 0
Series A-2 Convertible Preferred Stock
Class of Stock [Line Items]
Preferred stock par value \| $ / shares		$ 11.42
Undesignated Preferred Stock
Class of Stock [Line Items]
Preferred stock authorized					10,000,000
Preferred stock par value \| $ / shares					$ 0.0001
Stock Purchase Agreement \| Series A-2 Convertible Preferred Stock
Class of Stock [Line Items]
Number of shares agreed to issue		3,939,069
Price per share \| $ / shares		$ 11.42
Stock Purchase Agreement \| Class A and Class B Common Stock
Class of Stock [Line Items]
Common stock, shares outstanding		1,348,693
Stock Purchase Agreement \| Series A-1 Convertible Preferred Stock
Class of Stock [Line Items]
Number of shares converted		1,372,970
Stock Purchase Agreement \| Class A Common Stock
Class of Stock [Line Items]
Common stock, shares outstanding		1,033,117
Series B Stock Purchase Agreement \| Series B Convertible Preferred Stock
Class of Stock [Line Items]
Number of shares agreed to issue			7,234,766
Price per share \| $ / shares			$ 15.55
Gross proceeds from issuance of convertible preferred stock \| $			$ 112,500,000
Stock Restriction Agreements
Class of Stock [Line Items]
Number of shares became restricted and subject to repurchase				139,057
Number of founding stockholders entered \| Stockholder				2
Percentage of repurchase rights lapse on one-year anniversary.				50.00%
Percentage of repurchase rights lapse on second anniversary				50.00%
Measurement date fair value of shares vested per share \| $ / shares				$ 2.37
Measurement date aggregate fair value of shares \| $				$ 300,000
Shares subject to repurchase					0		0

Convertible Preferred Stock and Stockholders' Equity - Schedule of Reserved Shares of Common Stock for Issuance, on an As-Converted Basis (Details) - shares	Mar. 31, 2023	Dec. 31, 2022
Class of Stock [Line Items]
Reserved shares of common stock for issuance	5,585,855	4,469,296
Stock Options Issued and Outstanding
Class of Stock [Line Items]
Reserved shares of common stock for issuance	4,307,894	3,341,834
Authorized for Future Stock Awards or Option Grants
Class of Stock [Line Items]
Reserved shares of common stock for issuance	1,051,961	901,462
Authorized for Future Issuance under Employee Stock Purchase Plan
Class of Stock [Line Items]
Reserved shares of common stock for issuance	226,000	226,000

Stock-Based Compensation - Additional Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2023	Jan. 01, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Outstanding unvested stock options	$ 4,308,286
Unrecognized compensation cost related to unvested share options	$ 24,900,000
Expected recognition period of unrecognized compensation cost related to unvested share options	3 years 29 days
Stock Option Activity
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Weighted average grant date fair value of options granted	$ 9.52
2022 Plan
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Common stock outstanding percentage	5.00%
Additonal shares of evergreen provision		1,185,660
Shares remaining available for issuance	1,051,961
2022 Employee Stock Purchase Plan
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares authorized and reserved for issuance	226,000

Stock-Based Compensation - Summary of Stock Options Activity (Details) - 2020 Plan and 2022 Plan	3 Months Ended
	Mar. 31, 2023 $ / shares shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock Options Outstanding as of December 31, 2022 \| shares	3,341,834
Stock Options, Granted \| shares	1,116,850
Exercise of stock options, Shares \| shares	(68,709)
Stock Options, Canceled/Forfeited \| shares	(81,689)
Stock Options, Outstanding as of March 31, 2023 \| shares	4,308,286
Stock Options, Vested and exercisable as of March 31, 2023 \| shares	768,160
Stock Options, Vested and expected to vest as of March 31, 2023 \| shares	4,308,286
Weighted Average Exercise Price, Outstanding as of December 31, 2021 \| $ / shares	$ 9.52
Weighted Average Exercise Price, Granted \| $ / shares	15.26
Weighted average exercise price, exercised \| $ / shares	1.80
Weighted average exercise price, canceled/forfeited \| $ / shares	11.55
Weighted Average Exercise Price, Outstanding as of March 31, 2022 \| $ / shares	11.09
Weighted Average Exercise Price, Vested and exercisable as of March 31, 2022 \| $ / shares	7.30
Weighted Average Exercise Price, Vested and expected to vest as of March 31, 2022 \| $ / shares	$ 11.09

Stock-Based Compensation - Summary of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense	$ 1,348	$ 815
Research and development
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense	600	256
General and administrative
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense	$ 748	$ 559

Income Taxes - Additional Information (Details) - USD ($) $ in Thousands		3 Months Ended
	Jan. 01, 2022	Mar. 31, 2023	Mar. 31, 2022
Income Taxes [Line Items]
Income tax expense			$ 4,420
Uncertain tax position		700
Expected market return	40.00%
Her Majesty's Revenue and Customs \| Accrued Expenses
Income Taxes [Line Items]
Income tax liabilities		$ 3,300	4,400
Uncertain tax position			$ 700

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details