SEC Filing | Landos Biopharma

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10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-39971

Landos Biopharma, Inc.

(Exact Name of Registrant as Specified in its Charter)


Delaware	81-5085535
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1800 Kraft Drive, Suite 216 Blacksburg, Virginia	24060
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (540) 218-2232

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.01 per share

LABP

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 6, 2022, the registrant had 40,254,890 shares of common stock, $0.01 par value per share, outstanding.

Table of Contents


		Page

PART I.	FINANCIAL INFORMATION	3

Item 1.	Financial Statements (Unaudited)	3
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Operations and Comprehensive Loss	4
	Condensed Consolidated Statements of Cash Flows	5
	Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity	6
	Notes to Unaudited Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	21
Item 4.	Controls and Procedures	21

PART II.	OTHER INFORMATION	22

Item 1.	Legal Proceedings	22
Item 1A.	Risk Factors	22
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	22
Item 5.	Other Information	22
Item 6.	Exhibits	23
Signatures		24

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements. (Unaudited)

Landos Biopharma, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except share and per share amounts)


	March 31,			December 31,
	2022			2021
	Unaudited
Assets
Current assets:
Cash and cash equivalents	$	11,288		$	8,305
Marketable securities, available-for-sale		62,508			82,575
Prepaid expenses and other current assets		3,563			1,266
Total current assets		77,359			92,146
Property and equipment, net		224			707
Other assets		27			26
Total assets	$	77,610		$	92,879

Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	9,803		$	12,908
Accrued liabilities		5,704			3,703
Total current liabilities		15,507			16,611
Total liabilities		15,507			16,611
Commitments and contingencies (Note 6)
Stockholders’ equity:
Preferred stock, $0.01 par value; 10,000,000 shares authorized, no shares issued and outstanding as of March 31, 2022 and December 31, 2021		—			—
Common stock, $0.01 par value; 200,000,000 shares authorized, 40,254,890 shares issued and outstanding as of March 31, 2022 and December 31, 2021		403			403
Additional paid-in capital		171,182			170,241
Accumulated other comprehensive loss		(467	)		(225	)
Accumulated deficit		(109,015	)		(94,151	)
Total stockholders’ equity		62,103			76,268
Total liabilities and stockholders’ equity	$	77,610		$	92,879

The accompanying notes are an integral part of these condensed consolidated financial statements.

Landos Biopharma, Inc.

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss

(in thousands, except share and per share amounts)


	Three Months Ended March 31,
	2022			2021
Operating expenses:
Research and development	$	10,800		$	7,254
General and administrative		4,153			2,646
Total operating expenses		14,953			9,900
Loss from operations		(14,953	)		(9,900	)
Other income:
Gain from foreign exchange		1			18
Other income, net		88			64
Other income, net		89			82
Net loss	$	(14,864	)	$	(9,818	)
Net loss per share, basic and diluted	$	(0.37	)	$	(0.38	)
Weighted-average shares used to compute net loss per share, basic and diluted		40,254,890			26,070,455
Comprehensive loss:
Net loss	$	(14,864	)	$	(9,818	)
Unrealized loss on available-for-sale securities		(242	)		(112	)
Comprehensive loss	$	(15,106	)	$	(9,930	)

The accompanying notes are an integral part of these condensed consolidated financial statements.

Landos Biopharma, Inc.

Unaudited Condensed Consolidated Statements of Cash Flows

(in thousands)


	Three Months Ended March 31,
	2022			2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(14,864	)	$	(9,818	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		353			43
Stock-based compensation expense		941			1,023
Amortization of premium (discount) on marketable securities		312			(196	)
Non-cash loss on termination of lease		137			—
Gain on sale of equipment		(9	)		—
Changes in operating assets and liabilities:
Prepaid expenses and other assets		(2,262	)		(1,633	)
Accounts payable		(3,084	)		(404	)
Other liabilities		1,974			(1,575	)
Net cash used in operating activities		(16,502	)		(12,560	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment		(7	)		(64	)
Purchase of available-for-sale marketable securities		(1,027	)		(81,379	)
Proceeds from sales and maturities of marketable securities		20,540			9,395
Net cash provided by (used in) investing activities		19,506			(72,048	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from initial public offering, net of issuance costs		—			90,506
Proceeds from exercise of stock options		—			258
Net cash provided by financing activities		—			90,764
Net change in cash and cash equivalents		3,004			6,156
Cash and cash equivalents at beginning of period		8,305			2,416
Effect of exchange rates on cash		(21	)		—
Cash and cash equivalents at end of period	$	11,288		$	8,572

Supplemental non-cash disclosure: NONCASH INVESTING AND FINANCING ACTIVITY:
Conversion of Series A and B convertible preferred stock to common stock	$	—		$	73,037
Operating right-of-use asset obtained in exchange for operating lease liability	$	824		$	—
Derecognition of operating right-of-use asset and operating lease liability upon termination of lease	$	714		$	—
Unrealized loss on available-for-sale marketable securities	$	242		$	112

The accompanying notes are an integral part of these condensed consolidated financial statements.

Landos Biopharma, Inc.

Unaudited Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity

(in thousands, except share amounts)


	Convertible Preferred Stock						Common Stock
	Shares			Amounts			Shares		Amounts		Additional Paid-in Capital		Accumulated Other Comprehensive Loss			Accumulated Deficit			Total Stockholders’ Equity
Balance at December 31, 2021		—		$	—			40,254,890	$	403	$	170,241	$	(225	)	$	(94,151	)	$	76,268
Stock-based compensation expense		—			—			—		—		941		—			—			941
Unrealized loss on available-for-sale securities		—			—			—		—		—		(242	)		—			(242	)
Net loss		—			—			—		—		—					(14,864	)		(14,864	)
Balance at March 31, 2022		—		$	-			40,254,890	$	403	$	171,182	$	(467	)	$	(109,015	)	$	62,103

	Convertible Preferred Stock						Common Stock
	Shares			Amounts			Shares		Amounts		Additional Paid-in Capital		Accumulated Other Comprehensive Loss			Accumulated Deficit			Total Stockholders’ Equity
Balance at December 31, 2020		11,260,608		$	73,037			12,767,909	$	71	$	1,633	$	10		$	(55,729	)	$	(54,015	)
Conversion of preferred stock to common stock upon closing of the initial public offering		(11,260,608	)		(73,037	)		20,549,478		262		72,775		—			—			73,037
Issuance of common stock, net of issuance costs		—			—			6,250,000		63		90,443		—			—			90,506
Stock-based compensation expense		—			—			—		—		1,023		—			—			1,023
Exercise of stock options		—			—			299,282		3		555		—			—			558
Unrealized loss on available-for-sale securities		—			—			—		—		—		(112	)		—			(112	)
Net loss		—			—			—		—		—		—			(9,818	)		(9,818	)
Balance at March 31, 2021		—		$	-			39,866,669	$	399	$	166,429	$	(102	)	$	(65,547	)	$	101,179

The accompanying notes are an integral part of these condensed consolidated financial statements.

Landos Biopharma, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

1. Organization and Description of the Business

Landos Biopharma, Inc. (“Landos” or the “Company”) was incorporated in the state of Delaware in January 2017 and is a clinical-stage biopharmaceutical company focused on the discovery and development of oral therapeutics for patients with autoimmune diseases. The Company has several active development programs, each discovered internally, targeting novel pathways at the interface of immunity and metabolism.

Initial Public Offering

In February 2021, the Company completed its initial public offering ("IPO") in which it sold 6,250,000 shares of common stock at an initial public offering price of $16.00 per share. Proceeds from the IPO, net of underwriting discounts, commissions and offering costs paid by the Company, were approximately $90.5 million.

In addition, in connection with the completion of the Company’s IPO, all outstanding shares of the Company's convertible preferred stock were converted into 20,549,478 shares of the Company’s common stock.

Stock Split

In January 2021, the Company’s Board of Directors approved a 1.8249-for-1 stock split of the Company’s outstanding common shares. Also in January 2021, the Company amended its Amended and Restated Certificate of Incorporation to affect the stock split. The stock split resulted in an adjustment to the preferred share conversion price to reflect a proportional increase in the number of common shares to be issued upon conversion. The accompanying condensed consolidated financial statements and notes to the condensed consolidated financial statements give retroactive effect to the stock split for all periods presented.

Liquidity and Capital Resources

As of March 31, 2022, the Company had cash, cash equivalents and marketable securities of $73.8 million, which it believes will be sufficient to fund its planned operations into the second half of 2023.

Since the Company’s inception in 2017, it has funded operations through the issuance of convertible preferred stock and convertible promissory notes, the proceeds from its IPO, and the upfront payment from the license and collaboration agreement (Note 8). As of March 31, 2022, the Company had an accumulated deficit of $109.0 million and expects to incur substantial operating losses for at least the next several years. As such, the Company will need to raise additional capital to initiate and complete its planned clinical trials, to continue and expand its research and development operations that support its planned discovery, development and clinical and regulatory activities, and to adequately prepare for commercialization of its product candidates that may achieve regulatory approval in the future.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Landos Biopharma Australia Pty Ltd. (“Landos Australia”). All intercompany balances and transactions have been eliminated in consolidation.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the Company’s audited financial statements and notes thereto included in its Annual Report on Form 10-K for the year ended December 31, 2021. In the opinion of the Company’s management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of its financial position, operating results and cash flows for the periods presented have been included. Operating results for the three months ended March 31, 2022, are not necessarily indicative of the results that may be expected for the full year, for any other interim period or for any future year.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts in the Company's consolidated financial statements and the disclosures made in the

accompanying notes. Significant estimates and assumptions made in the accompanying condensed consolidated financial statements include but are not limited to accrued liabilities, fair value of equity instruments, and uncertain tax positions. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Despite management’s intention to establish accurate estimates and use reasonable assumptions, actual results may differ from the Company's estimates.

Significant Accounting Policies

The significant accounting policies used in preparation of these unaudited condensed consolidated financial statements for the three months ended March 31, 2022 are consistent with, and should be read in conjunction with, those discussed in Note 1 of the consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2021.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash and highly liquid investments with original maturities of three months or less at the date of purchase. The carrying amounts approximate fair value due to the short maturities of these investments. Cash equivalents consist primarily of amounts invested in money market funds and commercial paper and are stated at fair value.

Marketable Securities

The Company’s investments in marketable securities are maintained by investment managers and consist of corporate debt securities with original maturities of over ninety (90) days, all of which are considered available-for-sale debt securities. The Company classifies its available-for-sale securities as short-term marketable securities on the Condensed Consolidated Balance Sheets, even though the stated maturity date may be one year or more beyond the current Condensed Consolidated Balance Sheets date, as the Company views those securities as available for use in current operations, if needed.

Available-for-sale securities are carried at fair value with their unrealized gains and losses included in accumulated other comprehensive loss within stockholders’ equity, until such gains and losses are realized in other income (expense), net, within the Condensed Consolidated Statements of Operations and Comprehensive Loss or until an unrealized loss is considered other-than-temporary. Realized gains and losses are determined using the specific identification method.

The Company evaluates its investments with unrealized losses for other-than-temporary impairment. When assessing investments for other-than-temporary impairments in value, the Company considers such factors as, among other things, how significant the impairment in value is as a percentage of the original cost, how long the market value of the investment has been less than its original cost, the Company’s ability and intent to retain the investment for a period of time sufficient to allow for any anticipated recovery in fair value and market conditions. If the Company determines from this analysis that it does not expect to receive cash flows sufficient to recover the entire amortized cost of the security, a credit loss exists, the impairment is considered other-than-temporary and is recognized in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to a concentration of credit risk consist primarily of cash, cash equivalents, and marketable securities. Bank deposits are held by accredited financial institutions and these deposits may at times be in excess of insured limits. The Company limits its credit risk associated with cash and cash equivalents by placing them with financial institutions it believes are of high quality. The Company has not experienced any losses on its deposits of cash or cash equivalents. The Company’s available-for-sale investments primarily consist of high-grade corporate debt, and potentially subject the Company to concentrations of credit risk. The Company has adopted investment guidelines that limit the amounts the Company may invest in any one type of investment and requires all investments held by the Company to be highly rated, thereby reducing credit risk exposure.

Research and Development Expenses

Research and development costs consist primarily of external costs related to clinical development, contract manufacturing and discovery as well as personnel costs. The Company estimates preclinical and clinical study and research expenses based on the services performed, pursuant to contracts with research institutions that conduct and manage nonclinical and clinical studies and research services on its behalf. The Company records the costs of research and development activities based upon the estimated amount of services provided but not yet invoiced and includes these costs in accrued liabilities in the Condensed Consolidated Balance Sheets. These costs are a component of the Company’s research and development expenses. The Company accrues for these costs based on factors such as estimates of the work completed and in accordance with agreements established with its third-party service providers under the service

agreements. The Company makes significant judgments and estimates in determining the accrued liabilities balance in each reporting period. As actual costs become known, the Company adjusts its accrued liabilities.

Net Loss per Share

Basic loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock together with the number of additional shares of common stock that would have been outstanding if all potentially dilutive shares of common stock had been issued. Since the Company was in a loss position for the periods presented, basic net loss per share is the same as diluted net loss per share since the effects of potentially dilutive securities are antidilutive.

The following outstanding shares of potentially dilutive securities have been excluded from diluted net loss per common share for the periods presented, because their inclusion would be anti-dilutive:


	Three Months Ended March 31,
	2022		2021
Stock options to purchase common stock		1,676,389		1,299,586
Common stock subject to repurchase		—		250,924
Total		1,676,389		1,550,510

Comprehensive Loss

The Company’s comprehensive loss is currently comprised of changes in unrealized losses on available-for-sale securities.

Segment Reporting

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. The Company views it operations and manages its business in one operating segment.

Emerging Growth Company Status

The Company is an emerging growth company (“EGC”), as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an EGC or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these combined and condensed consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.

Recently Adopted Accounting Pronouncements

In February 2016, the FASB issued ASU 2016-02—Leases (Topic 842), requiring the recognition of lease assets and liabilities on the balance sheet. The standard: (a) clarifies the definition of a lease; (b) requires a dual approach to lease classification similar to current lease classifications; and (c) causes lessees to recognize leases on the balance sheet as a lease liability with a corresponding right-of-use asset for leases with a lease-term of more than twelve months. The standard was effective for public entities for fiscal years beginning after December 15, 2018 and is effective for nonpublic entities for fiscal years beginning after December 15, 2021. The Company adopted ASU 2016-02, as amended, by applying the modified retrospective approach for leases existing at, and entered into after January 1, 2022. As a result, prior periods are presented in accordance with the previous guidance in ASC 840, Leases (“ASC 840”). The Company has elected to apply the “practical expedient package,” which permits it to not reassess previous conclusions around lease identification, lease classification, and initial direct costs. Further, the Company made accounting policy elections to exclude leases with terms of 12 months or less from the recognition requirements and to not separate lease and non-lease components. On January 1, 2022, the Company recognized an initial right-of-use asset and lease liability of $0.8 million. The adoption of Topic 842 did not have an impact on the Company’s Condensed Consolidated Statements of Operations and Comprehensive Loss and did not require recognition of a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company elected to continue applying the guidance under ASC 840 for comparative periods, as allowed in Topic 842.

Recently Issued Accounting Pronouncements Not Yet Adopted

In June 2016, the FASB issued ASU 2016-13—Financial Instruments (Topic 326) Measurement of Credit Losses on Financial Instrument (“CECL”), which requires an allowance for expected credit losses on financial assets be recognized as early as day one of the instrument. This ASU departs from the incurred loss model which means the probability threshold is removed. It considers more forward-looking information and requires the entity to estimate its credit losses as far as it can reasonably estimate. The ASU was effective for fiscal years beginning after December 15, 2019 for public business entities that are U.S. Securities and Exchange Commission (SEC) filers, excluding entities eligible to be smaller reporting companies (SRC). For all other public business entities, including SRC, the ASU is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018. The Company expects to adopt the new standard in the annual reporting period beginning after December 15, 2022 and does not expect the adoption of this ASU to have a material impact on the consolidated financial statements.

3. Fair Value Measurement

Financial assets and liabilities are recorded at fair value on a recurring basis in the Condensed Consolidated Balance Sheets. The carrying values of the Company’s financial assets and liabilities, including cash and cash equivalents, prepaids and other current assets, accounts payable, and accrued expenses approximate their fair value due to the short-term maturity of these instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. Assets and liabilities recorded at fair value in the condensed consolidated financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels are directly related to the amount of subjectivity with the inputs to the valuation of these assets or liabilities as follows:

Level 1—Observable inputs such as unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

Level 2—Inputs (other than quoted prices included in Level 1) that are either directly or indirectly observable inputs for similar assets or liabilities. These include quoted prices for identical or similar assets or liabilities in active markets and quoted prices for identical or similar assets of liabilities in markets that are not active;

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

Financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used in such measurements are as follows (in thousands):


	March 31, 2022
	Level 1		Level 2		Level 3		Aggregate fair value
Assets:
Money market funds	$	4,789	$	—	$	—	$	4,789
U.S. government treasury securities		1,250		—		—		1,250
Fixed income securities		—		38,536		—		38,536
Asset backed securities		—		23,972		—		23,972
Total assets	$	6,039	$	62,508	$	—	$	68,547


	December 31, 2021
	Level 1		Level 2		Level 3		Aggregate Fair Value
Assets:
Money market funds	$	3,180	$	—	$	—	$	3,180
Fixed income securities		—		54,224		—		54,224
Asset backed securities		—		28,351		—		28,351
Total assets	$	3,180	$	82,575	$	—	$	85,755

The contractual maturities of available-for-sale securities of March 31, 2022 are as follows (in thousands):


Within one year	$	34,854
Within one to five years		27,654
Total contractual maturities	$	62,508

The Company’s financial instruments consist of Level 1 and Level 2 assets. The Company values its Level 1 assets based on quoted prices in active markets for identical instruments. Level 1 assets consist primarily of highly liquid money market funds that are included in cash equivalents. The Company values its Level 2 assets consisting of certificates of deposits, fixed income securities, and asset backed securities with the help of a third-party pricing service using quoted market prices for similar instruments or nonbinding market prices that are corroborated by observable market data. The Company uses such pricing data as the primary input, to which no material

adjustments have been made during the periods presented, to make its determination and assessments as to the ultimate valuation of these assets. The fair values of these instruments approximate amortized cost.

There were no transfers into or out of Level 3 securities during the three months ended March 31, 2022.

4. Balance Sheet Components

Property and Equipment, net

Property and equipment, net consists of the following:


	March 31,			December 31,
	2022			2021
Laboratory equipment	$	791		$	837
Furniture and fixtures		307			307
Construction in process		—			104
Total property and equipment		1,098			1,248
Less: accumulated depreciation		(874	)		(541	)
Total property and equipment, net	$	224		$	707

Depreciation expense for property and equipment was $0.4 million and $43,000 for the three months ended March 31, 2022 and 2021, respectively.

Accrued Liabilities

Accrued liabilities consist of the following:


	March 31,		December 31,
	2022		2021
Accrued research and development	$	4,498	$	1,575
Accrued general and administrative		646		996
Accrued payroll and employee benefits		533		1,132
Operating lease liability		27		—
Total accrued liabilities	$	5,704	$	3,703

5. Stockholders’ Equity

Convertible Preferred Stock

In connection with the completion of the Company’s IPO in February 2021, all outstanding shares of the Company’s convertible preferred stock automatically converted into 20,549,478 shares of common stock.

Stock-Based Compensation

2019 Equity Incentive Plan

In December 2019, the board of directors of the Company (the “Board”) adopted the 2019 Equity Incentive Plan (the “2019 Plan”). The 2019 Plan provides for the grant of share-based awards, including stock options and restricted stock units, to employees, directors, and non-employee service providers of the Company. The number of shares of common stock reserved for issuance under the 2019 Plan automatically increases on January 1 of each calendar year, starting on January 1, 2020 and continuing through January 1, 2029, in an amount equal to the least of (i) 5% of the total number of shares of the Company’s capital stock issued and outstanding on the last day of the calendar month before the date of each automatic increase; (ii) 1,000,000 shares; or (iii) a lesser number of shares determined by the Company’s board of directors. Subject to this provision, the Company added 1,824,900 shares available for grant to the 2019 Plan effective January 1, 2022. As of March 31, 2022, there are approximately 8,553,496 shares available for future grants.

2021 Employee Stock Purchase Plan

In January 2021, the Board adopted the 2021 Employee Stock Purchase Plan (the “2021 ESPP”). The purpose of the 2021 ESPP is to secure the services of new employees, to retain the services of existing employees and to provide incentives for such individuals to exert

maximum efforts toward the Company’s success. The ESPP is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the Code for U.S. employees. The number of shares of common stock reserved for issuance under the 2021 ESPP automatically increases on January 1 of each calendar year, starting on January 1, 2022 and continuing through January 1, 2031, in an amount equal to the lesser of (i) 1% of the total number of shares of the Company’s capital stock issued and outstanding on the last day of the calendar month before the date of each automatic increase; or (ii) a lesser number of shares determined by the Board. Subject to this provision, the Company added 402,548 shares available for grant to the 2021 ESPP effective January 1, 2022. As of March 31, 2022, there are approximately 791,251 shares available for future grants under the 2021 ESPP. As of March 31, 2022, no shares of common stock have been purchased under the 2021 ESPP.

2022 Inducement Plan

In March 2022, the Board adopted the 2022 Inducement Plan. The 2022 Inducement Plan is a non-stockholder approved stock plan under which the Company may grant equity awards to induce highly-qualified prospective officers and employees who are not currently employed by the Company to accept employment and provide them with a proprietary interest in the Company. The Company intends that the 2022 Inducement Plan be reserved for persons to whom the Company may issue securities without stockholder approval as an inducement pursuant to Nasdaq Marketplace Rule 5635(c)(4). The number of shares of common stock reserved for issuance under the 2022 Inducement Plan was initially determined to be 1,000,000 shares. As of March 31, 2022, there are 1,000,000 shares available for future grants under the 2022 Inducement Plan.

Stock Option Awards

The total intrinsic value of stock options exercised was $2.3 million for the three months ended March 31, 2021.