0001558370-21-010528 | 10-Q | XBRL Viewer

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Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2021	Aug. 04, 2021
Document and Entity Information
Entity Registrant Name	KALA PHARMACEUTICALS, INC.
Entity Central Index Key	0001479419
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2021
Document Transition Report	false
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity File Number	001-38150
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	27-0604595
Entity Address, Address Line One	490 Arsenal Way, Suite 120
Entity Address, City or Town	Watertown
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02472
City Area Code	781
Local Phone Number	996-5252
Title of 12(b) Security	Common Stock, $0.001 par value per share
Trading Symbol	KALA
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Common Stock, Shares Outstanding		64,971,096
Entity Shell Company	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 144,635	$ 77,264
Short-term investments	5,000	76,276
Accounts receivable, net	11,859	9,604
Inventory	8,046	5,229
Prepaid expenses and other current assets	2,180	3,006
Total current assets	171,720	171,379
Non-current assets:
Property and equipment, net	3,416	3,166
Long-term inventory	9,157	6,219
Right-of-use assets	27,953	27,853
Restricted cash and other long-term assets	3,218	12,989
Total assets	215,464	221,606
Current liabilities:
Accounts payable	2,844	1,724
Accrued expenses and other current liabilities	21,255	18,971
Current portion of lease liabilities	1,977	1,530
Total current liabilities	26,076	22,225
Long-term liabilities:
Long-term lease liabilities	27,063	27,143
Long-term debt	78,055	72,243
Total long-term liabilities	105,118	99,386
Total liabilities	131,194	121,611
Commitments and Contingencies (Note 14)
Stockholders' equity:
Common stock, $0.001 par value; 120,000,000 shares authorized as of June 30, 2021 and December 31, 2020; 64,770,219 and 58,915,375 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively	65	59
Additional paid-in capital	550,898	499,715
Accumulated other comprehensive income		4
Accumulated deficit	(466,693)	(399,783)
Total stockholders' equity	84,270	99,995
Total liabilities and stockholders' equity	$ 215,464	$ 221,606

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2021	Dec. 31, 2020
CONDENSED CONSOLIDATED BALANCE SHEETS
Common stock, par value	$ 0.001	$ 0.001
Common stock, authorized	120,000,000	120,000,000
Common stock, shares issued	64,770,219	58,915,375
Common stock, shares outstanding	64,770,219	58,915,375

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
Product revenues, net	$ 3,051	$ 833	$ 6,317	$ 1,904
Costs and expenses:
Cost of product revenues	1,016	759	1,771	1,113
Selling, general and administrative	27,986	15,301	55,685	30,709
Research and development	3,094	6,053	6,220	11,487
Total costs and expenses	32,096	22,113	63,676	43,309
Loss from operations	(29,045)	(21,280)	(57,359)	(41,405)
Other income (expense):
Interest and other income	33	102	76	400
Interest and other expense	(2,091)	(2,134)	(4,232)	(4,262)
Loss on extinguishment of debt	(5,395)		(5,395)
Total interest and other expense	(7,453)	(2,032)	(9,551)	(3,862)
Net loss	$ (36,498)	$ (23,312)	$ (66,910)	$ (45,267)
Net loss per share-basic and diluted	$ (0.57)	$ (0.42)	$ (1.06)	$ (0.94)
Weighted average shares outstanding-basic and diluted	64,554,506	55,703,882	63,113,194	48,232,933
Statement of Comprehensive Loss
Net loss	$ (36,498)	$ (23,312)	$ (66,910)	$ (45,267)
Other comprehensive loss:
Change in unrealized gains on investments	(3)	17	(4)	17
Total other comprehensive loss	(3)	17	(4)	17
Total comprehensive loss	$ (36,501)	$ (23,295)	$ (66,914)	$ (45,250)

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Income	Accumulated Deficit	Total
Balance as of beginning of period at Dec. 31, 2019	$ 36	$ 325,112		$ (295,456)	$ 29,692
Balance as of beginning of period (in shares) at Dec. 31, 2019	36,086,254
Balance as of end of period at Mar. 31, 2020	$ 55	458,866		(317,411)	141,510
Balance as of end of period (in shares) at Mar. 31, 2020	54,585,636
Balance as of beginning of period at Dec. 31, 2019	$ 36	325,112		(295,456)	29,692
Balance as of beginning of period (in shares) at Dec. 31, 2019	36,086,254
Stockholders' Equity
At the market offering, net of sales agent commission	$ 3	12,543			12,546
At the market offering, net of sales agent commission (in shares)	2,352,671
Exercise of stock options		938			938
Exercise of stock options (in shares)	311,028
Issuance of common stock under employee stock purchase plan		270			270
Issuance of common stock under employee stock purchase plan (in shares)	85,553
Common stock offering, net of offering costs	$ 17	125,406			125,423
Common stock offering, net of offering costs (in shares)	16,979,371
Stock-based compensation expense		5,358			5,358
Warrant exercises (in shares)	16,144
Change in fair value of investments			$ (17)		(17)
Net loss				(45,267)	(45,267)
Balance as of end of period at Jun. 30, 2020	$ 56	469,627	(17)	(340,723)	128,943
Balance as of end of period (in shares) at Jun. 30, 2020	55,831,021
Balance as of beginning of period at Mar. 31, 2020	$ 55	458,866		(317,411)	141,510
Balance as of beginning of period (in shares) at Mar. 31, 2020	54,585,636
Stockholders' Equity
Exercise of stock options		772			772
Exercise of stock options (in shares)	249,870
Common stock offering, net of offering costs	$ 1	7,215			7,216
Common stock offering, net of offering costs (in shares)	979,371
Stock-based compensation expense		2,774			2,774
Warrant exercises (in shares)	16,144
Change in fair value of investments			(17)		(17)
Net loss				(23,312)	(23,312)
Balance as of end of period at Jun. 30, 2020	$ 56	469,627	(17)	(340,723)	128,943
Balance as of end of period (in shares) at Jun. 30, 2020	55,831,021
Balance as of beginning of period at Dec. 31, 2020	$ 59	499,715	4	(399,783)	99,995
Balance as of beginning of period (in shares) at Dec. 31, 2020	58,915,375
Stockholders' Equity
At the market offering, net of sales agent commission	$ 6	40,724			40,730
At the market offering, net of sales agent commission (in shares)	5,583,329
Exercise of stock options		248			248
Exercise of stock options (in shares)	88,888
Issuance of vested restricted stock units (in shares)	107,780
Issuance of common stock under employee stock purchase plan		431			431
Issuance of common stock under employee stock purchase plan (in shares)	74,847
Stock-based compensation expense		9,780			9,780
Change in fair value of investments			(4)		(4)
Net loss				(66,910)	(66,910)
Balance as of end of period at Jun. 30, 2021	$ 65	550,898		(466,693)	84,270
Balance as of end of period (in shares) at Jun. 30, 2021	64,770,219
Balance as of beginning of period at Mar. 31, 2021	$ 64	539,920	3	(430,195)	109,792
Balance as of beginning of period (in shares) at Mar. 31, 2021	63,805,108
Stockholders' Equity
At the market offering, net of sales agent commission	$ 1	6,020			6,021
At the market offering, net of sales agent commission (in shares)	837,257
Exercise of stock options		64			64
Exercise of stock options (in shares)	20,074
Issuance of vested restricted stock units (in shares)	107,780
Stock-based compensation expense		4,894			4,894
Change in fair value of investments			$ (3)		(3)
Net loss				(36,498)	(36,498)
Balance as of end of period at Jun. 30, 2021	$ 65	$ 550,898		$ (466,693)	$ 84,270
Balance as of end of period (in shares) at Jun. 30, 2021	64,770,219

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - (Parenthetical) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2021	Jun. 30, 2020
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
Sales agent commission	$ 170	$ 1,161	$ 388
Offering costs			$ 8,475

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Thousands	6 Months Ended
	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)
Cash flows from operating activities:
Net loss	$ (66,910)	$ (45,267)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization	504	454
Non-cash operating lease cost	1,118	952
Loss of extinguishment of debt	5,395
Amortization of debt discount and other non-cash interest	645	513
Stock-based compensation	9,412	5,271
Amortization of discount on available-for-sale securities	22
Change in operating assets and liabilities:
Accounts receivable	(2,255)	7,282
Prepaid expenses and other current assets	826	1,351
Inventory	(5,387)	(1,306)
Accounts payable	1,250	(973)
Accrued expenses and other current liabilities	1,966	(6,782)
Lease liabilities and other long-term liabilities	(834)	(629)
Net cash used in operating activities	(54,248)	(39,134)
Cash flows from investing activities:
Purchases of property and equipment and other assets	(545)	(915)
Purchases of short-term investments		(56,535)
Proceeds from sales or maturities of short-term investments	71,250
Net cash provided by (used in) investing activities	70,705	(57,450)
Cash flows from financing activities:
Proceeds from issuance of debt, net of debt issuance costs of $2,218	77,782
Payment of principal, prepayment penalty and exit fee on debt	(78,010)
Proceeds from common stock offerings, net of offering costs	40,730	137,969
Payment of principal on finance lease	(17)	(16)
Proceeds from exercise of stock options and issuance of common stock under employee stock purchase plan	679	1,207
Net cash provided by financing activities	41,164	139,160
Net increase in cash, cash equivalents and restricted cash:	57,621	42,576
Cash, cash equivalents and restricted cash at beginning of period	89,756	98,031
Cash, cash equivalents and restricted cash at end of period	147,377	140,607
Reconciliation of cash, cash equivalents and restricted cash:
Cash, cash equivalents, and restricted cash at end of period	147,377	140,607
Less restricted cash (Note 8)	(2,742)	(12,584)
Cash and cash equivalents at end of period	144,635	128,023
Non-cash investing and financing activities:
Purchases of property and equipment in accrued expenses	318
Supplemental disclosure:
Cash paid for interest	3,030	$ 3,749
Right-of-use assets obtained in exchange of operating lease obligations	$ 1,218

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) $ in Thousands	Jun. 30, 2021 USD ($)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Debt issuance costs	$ 2,218

NATURE OF BUSINESS AND BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2021

NATURE OF BUSINESS AND BASIS OF PRESENTATION

NATURE OF BUSINESS AND BASIS OF PRESENTATION

1. NATURE OF BUSINESS AND BASIS OF PRESENTATION

Nature of Business— Kala Pharmaceuticals, Inc. (the “Company”) was incorporated on July 7, 2009, and is a biopharmaceutical company focused on the discovery, development and commercialization of innovative therapies for diseases of the eye. The Company has applied its AMPPLIFY^® mucus-penetrating particle (“MPP”) Drug Delivery Technology to loteprednol etabonate (“LE”), a corticosteroid designed for ocular applications, resulting in the U.S. Food and Drug Administration’s (the “FDA”) approval of EYSUVIS^®(loteprednol etabonate ophthalmic suspension) 0.25%, for the short-term (up to two weeks) treatment of the signs and symptoms of dry eye disease, and INVELTYS^® (loteprednol etabonate ophthalmic suspension) 1% as the first and only topical twice-daily ocular corticosteroid for treatment of post-operative inflammation and pain following ocular surgery.

In January 2019, the Company launched its first commercial product, INVELTYS, in the United States and began shipping its second commercial product, EYSUVIS, to wholesalers in the United States in late December 2020 with the full promotional launch commencing in early January 2021. The Company is engaged in the commercialization of EYSUVIS and INVELTYS, research and development activities, raising capital and recruiting skilled personnel. The Company is subject to a number of risks similar to those of other companies conducting high-risk, research and development of pharmaceutical product candidates and launching products for the first time. Principal among these risks are dependence on key individuals and intellectual property, competition from other products and companies and the technical risks associated with the successful research, development and marketing of its product candidates. The Company’s success is dependent upon its ability to successfully commercialize its products, the success of its research and development efforts, its ability to obtain regulatory approval of its product candidates, its ability to raise additional capital when needed and, ultimately, attain profitable operations.

The Company is also progressing its pipeline of proprietary preclinical development programs targeted to address front and back of the eye diseases. These preclinical development programs, all of which are new chemical entities, include its receptor Tyrosine Kinase Inhibitor program, that is designed to inhibit the vascular endothelial growth factor pathway, for the treatment of retinal diseases, including wet age-related macular degeneration; its selective glucocorticoid receptor modulators, which are a novel class of therapies designed to modify the downstream activity of the receptors to exhibit the anti-inflammatory and immunomodulatory properties of the corticosteroid class of therapies without their associated side effects; and its novel surface targeting steroid designed to target the ocular surface and thus have the potential to have fewer side effects compared to traditional topical steroids. The Company owns all intellectual property and worldwide rights to these pipeline preclinical development programs.

Liquidity— Since inception, the Company has incurred significant losses from operations and negative cash flows from operations. As of June 30, 2021, the Company had an accumulated deficit of $466,693. As the Company commenced a full promotional launch of EYSUVIS in early January 2021 and commercially launched its first product, INVELTYS, in January 2019, it has had only limited revenues to date from product sales and has financed operations primarily through proceeds from its initial public offering of common stock (“IPO”), follow-on public common stock offerings and sales of its common stock under its at-the-market offering (“ATM Offering”) facility, private placements of preferred stock, borrowings under credit facilities, convertible promissory notes and warrants. The Company has devoted substantially all of its financial resources and efforts to research and development, including preclinical studies and clinical trials, and engaging in activities to commercialize EYSUVIS and INVELTYS. Although the Company expects to continue to generate revenue from sales of EYSUVIS and INVELTYS, there can be no assurance as to the amount or timing of any such revenue, and it expects to continue to incur significant expenses and operating losses. Net losses may fluctuate significantly from quarter-to-quarter and year-to-year.

The Company expects that its cash, cash equivalents and short-term investments as of June 30, 2021, together with anticipated net revenue from sales of EYSUVIS and INVELTYS, will enable it to fund its operating expenses, debt service obligations and capital expenditure requirements for at least twelve months from the date these condensed consolidated financial statements were issued. This evaluation is based on relevant conditions and events that are known and reasonably knowable at the date that the condensed consolidated financial statements are issued. As a result, the Company could deplete its available capital resources sooner than it currently expects.

COVID-19 –In order to safeguard the health of its employees from the ongoing novel coronavirus pandemic, or COVID-19, the Company is following, and will continue to follow, recommendations from the U.S. Centers for Disease Control and Prevention, as well as federal, state and local governments, regarding working-from-home practices for non-essential employees. As a result, all office-based personnel are permitted to work from home, and the Company’s laboratory facilities that support its early-stage research activities are being utilized as necessary. In addition, the Company previously suspended its sales force from substantially all in-person interactions with physicians and was limited to conducting educational and promotional activities virtually. The Company’s sales force has since resumed substantially all in-person interactions in the field, but if the Company suspends all or some in-person interactions with physicians in the future, or to the extent physicians limit in-person interactions, the Company may be limited to conducting educational and promotional activities virtually, which may continue to hamper its ability to market and commercialize EYSUVIS and INVELTYS.

In addition, government restrictions have at times led to moratoria on elective ocular surgeries in many jurisdictions, which had significantly reduced, and may in the future continue to significantly reduce, the demand for INVELTYS, which is indicated for the treatment of post-operative inflammation and pain following ocular surgery. The extent of the impact of the COVID-19 pandemic on the Company’s commercialization efforts of EYSUVIS and INVELTYS and its operational and financial performance will depend on certain developments, including the length and severity of this pandemic, the timing and extent of any resurgence of the COVID-19 virus or any variant strains of the virus, the availability and effectiveness of vaccines, and the impact of the foregoing on our customers, employees and vendors and government agencies, all of which are uncertain and cannot be predicted. The Company cannot reasonably estimate the extent to which the disruption may materially impact its condensed consolidated results of operations or financial position.

Use of Estimates—The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expense, and related disclosures. The Company bases estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. The Company evaluates its estimates and assumptions on an ongoing basis. Estimates and assumptions relied upon in preparing these condensed consolidated financial statements relate to, but are not limited to, revenue recognition, inventory, the present value of lease liabilities and the corresponding right-of-use assets, the fair value of warrants, stock-based compensation, accrued expenses and the recoverability of the Company’s net deferred tax assets and related valuation allowance. Actual results may differ from these estimates under different assumptions or conditions.

Net Loss per Share—Basic net loss per share is computed using the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed using the weighted average number of common shares outstanding during the period and, if dilutive, the weighted average number of potential shares of common stock, including the assumed exercise of stock options and warrants and the issuance of unvested restricted stock units (“RSUs”) and performance-based restricted stock units (“PSUs”).

The weighted average number of common shares included in the computation of diluted net loss gives effect to all potentially dilutive common equivalent shares, including outstanding stock options, warrants and unvested RSUs and PSUs. Common stock equivalent shares are excluded from the computation of diluted net loss per share if their effect is antidilutive. In periods in which the Company reports a net loss attributable to common stockholders, diluted net loss per share attributable to common stockholders is the same as basic net loss per share attributable to common stockholders since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. The Company reported a net loss attributable to common stockholders for each of the three and six months ended June 30, 2021 and 2020.

As of June 30, 2021 and 2020, potentially dilutive securities excluded from the calculation of diluted net loss per share because including such securities would have an anti-dilutive effect consisted of outstanding options to purchase 10,043,748 and 8,573,573 shares of the Company’s common stock, respectively, an aggregate of 1,282,830 and 957,097 unvested RSUs and PSUs, respectively, and an aggregate of 215,172 and 248,505 unexercised warrants, respectively.

Unaudited Interim Financial Information—The condensed consolidated financial statements of the Company included herein have been prepared, without audit, pursuant to the rules and regulations of the Securities Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations. The accompanying condensed consolidated financial statements reflect all adjustments consisting of normal, recurring adjustments, that are necessary for a fair presentation of the financial position, results of operations, statement of stockholders’ equity and cash flows for the interim periods presented. Interim results are not necessarily indicative of results for a full year. Accordingly, these condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 (the “Annual Report”).

The unaudited condensed consolidated financial statements include the accounts of Kala Pharmaceuticals, Inc. and its wholly owned subsidiary, Kala Pharmaceuticals Security Corporation. All intercompany transactions and balances have been eliminated in consolidation.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2021

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company’s significant accounting policies are described in Note 2, “Summary of Significant Accounting Policies,” to the consolidated financial statements included in the Annual Report. There have been no material changes to the significant accounting policies during the three months ended June 30, 2021.

Recent Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 significantly changes the impairment model for most financial assets and certain other instruments. ASU 2016-13 will require immediate recognition of estimated credit losses expected to occur over the remaining life of many financial assets, which will generally result in earlier recognition of allowances for credit losses on loans and other financial instruments. In November 2019, the FASB issued ASU 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) (“ASU 2019-10”), which is effective for Smaller Reporting Companies (“SRCs”) as defined by the SEC for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Upon adoption, beginning January 1, 2023, the Company does not expect ASU 2019-10 to have a material effect on its condensed consolidated financial statements.

FAIR VALUE OF FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2021

FAIR VALUE OF FINANCIAL INSTRUMENTS

FAIR VALUE OF FINANCIAL INSTRUMENTS

3. FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company has short-term investments which are considered financial instruments that are measured on a recurring basis. ASC 820, Fair Value Measurements and Disclosures, establishes a fair value hierarchy for those instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and its own assumptions (unobservable inputs). The hierarchy consists of three levels:

●

Level 1—Quoted prices in active markets for identical assets or liabilities.

●

Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.

●

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

The Company’s financial instruments consist primarily of cash equivalents and short-term investments in money market funds and short-term securities. Cash equivalents and short-term investments are reported at their respective fair values on the Company’s condensed consolidated balance sheets. See Note 4, “Investments” for additional information.

The following tables set forth the fair value of the Company’s financial assets by level within the fair value hierarchy as of June 30, 2021 and December 31, 2020:


	June 30, 2021
	Fair Value		Level 1		Level 2		Level 3
Assets:
Cash equivalents	$	126,118	$	126,118	$	—	$	—
Short-term investments		5,000		5,000		—		—
Total Assets	$	131,118	$	131,118	$	—	$	—


	December 31, 2020
	Fair Value		Level 1		Level 2		Level 3
Assets:
Cash equivalents	$	63,811	$	63,811	$	—	$	—
Short-term investments		76,276		76,276		—		—
Total Assets	$	140,087	$	140,087	$	—	$	—

During the three and six months ended June 30, 2021 and the year ended December 31, 2020, there were no transfers between Level 1, Level 2, and Level 3.

- 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

INVESTMENTS

6 Months Ended

Jun. 30, 2021

INVESTMENTS

INVESTMENTS

4. INVESTMENTS

Investments by security type consisted of the following as of June 30, 2021 and December 31, 2020:


	June 30, 2021
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
U.S. government agencies securities	$	5,000	$	—	$	—	$	5,000
Total	$	5,000	$	—	$	—	$	5,000

	December 31, 2020
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
U.S. treasury securities	$	26,744	$	2	$	—	$	26,746
U.S. government agencies securities		49,528		2		—		49,530
Total	$	76,272	$	4	$	—	$	76,276

As of June 30, 2021 and December 31, 2020, all of the Company’s investments had a contractual maturity within one year. The fair value of all of the Company’s investments are classified as short-term on its condensed consolidated balance sheets.

REVENUE & ACCOUNTS RECEIVABLE, NET

6 Months Ended

Jun. 30, 2021

REVENUE & ACCOUNTS RECEIVABLE, NET

REVENUE & ACCOUNTS RECEIVABLE, NET

5. REVENUE & ACCOUNTS RECEIVABLE, NET

The Company accounts for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers. Under ASC Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the entity expects to be entitled in exchange for those goods or services. The Company performs the following five steps to recognize revenue under ASC Topic 606: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only recognizes revenue when it is probable that it will collect the consideration to which it is entitled in exchange for the goods or services that will be transferred to the customer.

Product revenues, net

The Company sells EYSUVIS and INVELTYS primarily to wholesalers in the United States (collectively, “Customers”). These Customers subsequently resell the Company’s products to specialty and other retail pharmacies. In addition to agreements with Customers, the Company enters into arrangements with third-party payors that provide for government-mandated and/or privately-negotiated rebates, chargebacks and discounts for the purchase of the Company’s products.

The Company also holds inventory at a third-party pharmacy on a consignment basis and records revenue when control of the product transfers to the customer upon sale to the end user. The amount of inventory held on a consignment basis as of June 30, 2021 and December 31, 2020 was immaterial.

The goods promised in the Company’s product sales contracts represent a single performance obligation. The Company recognizes revenue from product sales at the point the Customer obtains control of the product, which occurs upon delivery. The transaction price (“net sales price”) that is recognized as revenue for product sales includes the selling price to the Customer and an estimate of variable consideration. Components of variable consideration include prompt pay and other discounts, product returns, government rebates, third-party payor rebates, coverage gap rebates, incentives such as patient co-pay assistance, and other fees paid to Customers and other third-party payors where a distinct good or service is not received. Variable consideration is recorded on the condensed consolidated balance sheet as either a reduction of accounts receivable, if payable to a Customer, or as a current liability, if payable to a third-party other than a Customer. The Company considers all relevant information when estimating variable consideration such as assessment of its current and anticipated sales and demand forecasts, actual payment history, information from third parties regarding the payor mix for products, information from third parties regarding the units remaining in the distribution channel, specific known market events and trends, industry data and current contractual and statutory requirements that are reasonably available. The Company includes estimated amounts for variable consideration in the net sales price to the extent it is determined probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved.

Payment terms with Customers do not exceed one year and, therefore, the Company does not account for a significant financing component in its arrangements. The Company expenses incremental cost of obtaining a contract with a Customer when incurred as the period of benefit is generally less than one year.

Reserves for Variable Consideration:

Trade Discounts and Allowances

The Company provides its Customers with certain trade discounts and allowances including discounts for prompt payments and other discounts and fees paid for distribution, data and administrative services. These discounts and fees are based on contractually-determined percentages and are recorded as a reduction of revenue and accounts receivable in the period in which the related product revenue is recognized.

Chargebacks

Chargebacks for fees and discounts to providers represent the estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices charged to Customers who directly purchase the product from the Company. Customers charge the Company for the difference between what they pay for the product and the ultimate selling price to the qualified healthcare providers. These components of variable consideration are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue and accounts receivable. Reserves for chargebacks consist of credits the Company expects to issue for units that remain in the distribution channel at the end of each reporting period and that the Company expects will be sold to qualified healthcare providers, as well as chargebacks that Customers have claimed, but for which the Company has not yet issued a credit.

Product Returns

Consistent with industry practice, the Company has a product returns policy that provides Customers right of return for product purchased within a specified period prior to and subsequent to the product’s expiration date. The Company estimates the amount of its products that may be returned and presents this amount as a reduction of revenue in the period the related product revenue is recognized, in addition to establishing a liability. The Company’s estimates for product returns are based upon available industry data and its own sales information, including its visibility into the inventory remaining in the distribution channel as well as historical returns, which develop over time.

Commercial Payor and Medicare Part D Rebates

The Company contracts with certain third-party payors, primarily pharmacy benefit managers (“PBMs”) and health plans (“Plans”), for the payment of rebates with respect to utilization of its product. These rebates are based on contractual percentages applied to the amount of product prescribed to patients who are covered by the PBMs or the Plans with which it contracts. The Company estimates the rebates for commercial and Medicare Part D payors based on the contractual discount percentage, the various payor mix for EYSUVIS and INVELTYS as well as future rebates that will be made for product that has been recognized as revenue but remains in the distribution channel at the end of each reporting period. The Company also estimates the number of patients in the prescription drug coverage gap for whom it will owe an additional liability under the Medicare Part D program. Such estimates are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability.

Government Rebates

The Company is subject to discount obligations under Medicaid and other government programs. For Medicaid, reserves are based on actual payment history, and estimates of future Medicaid beneficiary utilization applied to the Medicaid unit rebate formula established by the Centers for Medicaid and Medicare Services. The Company’s liability for these rebates consists of estimates of claims for the current period and estimated future claims that will be made for

product that has been recognized as revenue but remains in the distribution channel at the end of each reporting period. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability.

Co-pay Assistance Programs

The Company offers co-pay assistance programs (the “co-pay programs”), which are intended to provide financial assistance to patients who may or may not be covered by commercial insurance or, with respect to INVELTYS, who opt out of Medicare Part D programs. The calculation of accruals for the co-pay programs is based on actual claims processed during the period as well as an estimate of the number and cost per claim that the Company expects to receive associated with product that has been recognized as revenue but remains in the distribution channel at the end of each reporting period. Allowances for estimated co-pay claims are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability.

The following tables summarize activity in each of the Company’s product revenue provision and allowance categories for the three and six months ended June 30, 2021 and 2020:


	Trade Discounts,
	Allowances and				Rebates and
	Chargebacks (1)		Product Returns (2)		Incentives (3)
Balance as of December 31, 2020	$	1,157	$	600	$	4,904
Provision related to current period sales		2,201		245		10,216
Changes in estimate related to prior period sales		3		30		(26)
Credit/payments made		(1,823)		(419)		(7,880)
Balance as of March 31, 2021	$	1,538	$	456	$	7,214
Provision related to current period sales		2,103		356		11,193
Changes in estimate related to prior period sales		30		142		(353)
Credit/payments made		(2,260)		(253)		(9,801)
Balance as of June 30, 2021	$	1,411	$	701	$	8,253


	Trade Discounts,
	Allowances and				Rebates and
	Chargebacks (1)		Product Returns (2)		Incentives (3)
Balance as of December 31, 2019	$	1,783	$	180	$	10,044
Provision related to current period sales		725		—		4,576
Changes in estimate related to prior period sales		2		(66)		93
Credit/payments made		(1,114)		—		(8,090)
Balance as of March 31, 2020	$	1,396	$	114	$	6,623
Provision related to current period sales		335		—		2,194
Changes in estimate related to prior period sales		3		(51)		(234)
Credit/payments made		(1,336)		1		(3,013)
Balance as of June 30, 2020	$	398	$	64	$	5,570

(1)

Trade discounts, allowances and chargebacks include fees for distribution service fees, prompt pay and other discounts, and chargebacks. Estimated trade discounts, allowances and chargebacks are deducted from gross revenue at the time revenues are recognized and are recorded as a reduction to accounts receivable on the Company’s condensed consolidated balance sheets.

(2)	Estimated provisions for product returns are deducted from gross revenues at the time revenues are recognized and are included in accrued expenses and other current liabilities on the Company’s condensed consolidated balance sheets.

(3)	Rebates and incentives include managed care rebates, government rebates, co-pay program incentives, and sales incentives and allowances. Estimated provisions for rebates and discounts are deducted from gross revenues at the

time revenues are recognized and are included in accrued expenses and other current liabilities on the Company’s condensed consolidated balance sheets.

Accounts Receivable, net

Accounts receivable are reported on the condensed consolidated balance sheets at outstanding amounts due from Customers for product sales. The Company deducts sales discounts for prompt payments and other discounts, contractual fees for service arrangements and chargebacks from accounts receivable. The Company evaluates the collectability of accounts receivable on a regular basis, by reviewing the financial condition and payment history of Customers, an overall review of collections experience on other accounts, and economic factors or events expected to affect future collections experience. An allowance for doubtful accounts is recorded when a receivable is deemed to be uncollectible.

The Company recorded no allowance for doubtful accounts as of June 30, 2021 or December 31, 2020. The Company recorded an allowance of $1,411 and $1,157 for expected sales discounts, related to prompt pay discounts and other discounts, contractual fee for service arrangements and chargebacks, to wholesalers and distributors as of June 30, 2021 and December 31, 2020, respectively.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

+ Details

INVENTORY

6 Months Ended

Jun. 30, 2021

INVENTORY

INVENTORY

6. INVENTORY

Inventory consists of the following:


	June 30,		December 31,
	2021		2020

Raw materials	$	1,485	$	801
Work in progress		9,580		6,437
Finished goods		6,138		4,210
Total inventory	$	17,203	$	11,448

As of June 30, 2021, the Company had $8,046 of current inventory and $9,157 of long-term inventory. As of December 31, 2020, the Company had $5,229 of current inventory and $6,219 of long-term inventory.

ACCRUED EXPENSES

6 Months Ended

Jun. 30, 2021

ACCRUED EXPENSES

ACCRUED EXPENSES

7. ACCRUED EXPENSES

Accrued expenses consist of the following:


	June 30,		December 31,
	2021		2020

Accrued revenue reserves (1)	$	8,261	$	5,224
Compensation and benefits		8,035		9,676
Commercial costs		2,121		2,103
Contract manufacturing		773		336
Professional services		605		926
Interest		533		—
Development costs		377		154
Other		550		552
Accrued expenses	$	21,255	$	18,971

(1) There were additional revenue reserves included in accounts payable of $693 and $280, as of June 30, 2021 and December 31, 2020, respectively.

LEASES

6 Months Ended

Jun. 30, 2021

LEASES

LEASES

8. LEASES

Operating leases

In connection with the lease of the Company’s corporate headquarters (the “Watertown Lease”), the Company issued a letter of credit to the landlord for $2,042. The Company secured the letter of credit for the full amount of the letter with cash on deposit, which is reported as restricted cash on the condensed consolidated balance sheets as of June 30, 2021 and December 31, 2020.

For the three and six months ended June 30, 2021, the variable lease expense for the Watertown Lease, which includes common area maintenance and real estate taxes, was $334 and $697, respectively. For the three and six months ended June 30, 2020, the variable lease expense for the Watertown Lease, which includes common area maintenance and real estate taxes, was $611 and $1,068, respectively. The remaining lease term was 10.3 years as of June 30, 2021.

Vehicle Fleet lease

During the year ended December 31, 2019, the Company entered into a master fleet lease agreement (the “Vehicle Fleet Lease”), pursuant to which it leased 65 vehicles. In connection with the Vehicle Fleet Lease, the Company issued a letter of credit for $450, which was reported as restricted cash on the condensed consolidated balance sheets as of June 30, 2021 and December 31, 2020. The lease has an expected term of three years, which commenced upon the delivery of the vehicles in March 2019.

During the six months ended June 30, 2021, the Company modified the Vehicle Fleet Lease to add 54 additional vehicles to the fleet. The new component of the lease has an expected term of approximately three years, which commenced upon the delivery of the additional vehicles in March 2021.

The components of lease expense and related cash flows were as follows:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Lease cost
Operating lease cost	$	1,268	$	1,185	$	2,484	$	2,371
Variable lease cost		584		658		1,093		1,068
Total lease cost	$	1,852	$	1,843	$	3,577	$	3,439

Operating cash outflows from operating leases	$	1,659	$	1,686	$	3,243	$	3,130

The weighted average remaining lease term and weighted average discount rate of operating leases are as follows:


	June 30,	December 31,
	2021	2020
Weighted average remaining lease term	9.9 years	10.3 years
Weighted average discount rate	9.6%	9.8%

DEBT

6 Months Ended

Jun. 30, 2021

DEBT

DEBT

9. DEBT

Athyrium Credit Facility

On October 1, 2018, the Company entered into a credit agreement (the “Athyrium Credit Facility”) with Athyrium Opportunities III Acquisition LP (“Athyrium”) for up to $110,000. The Athyrium Credit Facility provided for a Term Loan A in the aggregate principal amount of $75,000 (the “Term Loan A”), and a Term Loan B in the aggregate principal amount of $35,000 (the “Term Loan B”). On October 1, 2018, the Company borrowed the entire principal amount of the Term Loan A. The maturity date of the Athyrium Credit Facility was October 1, 2024, the six-year anniversary of the close.

As of December 31, 2020, the unpaid principal balance under the Athyrium Credit Facility was $75,000 and the unamortized debt discount was $3,088. On May 4, 2021, the Company repaid all amounts owed under the Athyrium Credit Facility and terminated all commitments by Athyrium to extend further credit thereunder and all guarantees and security interests granted by the Company to the lenders thereunder. In connection with the termination of the Athyrium Credit Facility, the Company paid to the lenders a prepayment premium of $2,250 and an exit fee of $750. The transaction resulted in a loss on extinguishment of debt of $5,395, consisting of the prepayment premium, the unamortized debt discount and issuance costs and the unaccreted exit fee.

Loan and Security Agreement

On May 4, 2021 (the “Closing Date”), the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with Oxford Finance LLC, in its capacity as lender (in such capacity, the “Lender”), and in its capacity as collateral agent (in such capacity, the “Agent”), pursuant to which a term loan of up to an aggregate principal amount of $125,000 is available to the Company, consisting of (i) a tranche A term loan that was disbursed on the Closing Date in the aggregate principal amount of $80,000; (ii) a contingent tranche B term loan in the aggregate principal amount of $20,000 available to the Company through June 30, 2023 and within 90 days of the Company achieving trailing 6-month product revenue equal to or greater than $75,000, subject to certain other terms and conditions; and (iii) a contingent tranche C term loan in the aggregate principal amount of $25,000 available to the Company through December 31, 2023 and within 90 days of the Company achieving trailing 6-month product revenue equal to or greater than $100,000, subject to certain other terms and conditions. The Company utilized substantially all of the proceeds from the tranche A term loan to repay the Athyrium Credit Facility (as more fully described above).

The term loans bear interest at a floating rate equal to the greater of (i) 30-day LIBOR and (ii) 0.11%, plus 7.89%. The Loan Agreement provides for interest-only payments until December 1, 2024 if neither the tranche B term loan nor the tranche C term loan are made, and until June 1, 2025 if either the tranche B term loan or the tranche C term loan is made (the “Amortization Date”). The aggregate outstanding principal balance of the term loans are required to be repaid in monthly installments starting on the Amortization Date based on a repayment schedule equal to (i) 18 months if neither the tranche B term loan nor the tranche C term loan is made and (ii) 12 months if either the tranche B term loan or the tranche C term loan is made. All unpaid principal and accrued and unpaid interest with respect to each term loan is due and payable in full on May 1, 2026 (the “Maturity Date”).

The Company paid a facility fee of $400 on the Closing Date and has agreed to pay a facility fee of $100 upon closing of the tranche B term loan and a $125 facility fee upon the closing of the tranche C term loan. The Company will be required to make a final payment fee of 7.00% of the original principal amount of any funded term loan payable on the earlier of (i) the prepayment of the term loan in full or (ii) the Maturity Date. At the Company’s option, the Company may elect to prepay all, but not less than all, of the outstanding loans, subject to a prepayment fee equal to the following percentage of the principal amount being prepaid: 3.00% if an advance is prepaid during the first 12 months following the applicable advance date, 2.00% if an advance is prepaid after 12 months but prior to 24 months following the applicable advance date, and 1.00% if an advance is prepaid any time after 24 months following the applicable advance date but prior to the Maturity Date.

In connection with its entry into the Loan Agreement, the Company granted the Agent a security interest in substantially all of the Company’s personal property owned or later acquired, including intellectual property. The Loan Agreement also contains customary representations and warranties and affirmative and negative covenants, as well as customary events of default. Certain of the customary negative covenants limit the ability of the Company and certain of its subsidiaries, among other things, to incur future debt, grant liens, make investments, make acquisitions, distribute dividends, make certain restricted payments and sell assets, subject in each case to certain exceptions.

The Loan Agreement includes features requiring (i) additional interest rate upon an event of default accrued at an additional 5%, and (ii) the Lender’s right to declare all outstanding principal and interest immediately payable upon an event of default. These two features were analyzed and determined to be embedded derivatives to be valued as separate financial instruments. These embedded derivatives were bundled and valued as one compound derivative in accordance with the applicable accounting guidance for derivatives and hedging transactions. The Company determined that, due to the unlikely event of default, the embedded derivatives have a de minimis value as of June 30, 2021. The derivative liability will be remeasured at fair value at each reporting date, with changes in fair value being recorded as other income (expense) in the condensed consolidated statements of operations and comprehensive loss.

In addition, in connection with the Loan Agreement, the Company paid certain fees to the Lender and other third-party service providers. The fees paid to the Lender were recorded as a debt discount while the fees paid to other third-party service providers were recorded as debt issuance cost. These costs were amortized using the effective interest method over the term of the Loan Agreement. The amortization of debt discount and debt issuance cost is included in interest expense within the condensed consolidated statements of operations and comprehensive loss. As of June 30, 2021, the effective interest rate was 10.41%, which takes into consideration the non-cash accretion of the exit fee and the amortization of the debt discount and issuance costs.

During the three months ended June 30, 2021 and June 30, 2020, the Company recognized interest expense of $1,860 and $2,095, respectively, for the Loan Agreement and Athyrium Credit Facility. This consisted of amortization of debt discount of $150 and $223 for the periods ended June 30, 2021 and June 30, 2020, respectively, and the contractual coupon interest expense of $1,710 and $1,872 for the periods ended June 30, 2021 and June 30, 2020, respectively. During the six months ended June 30, 2021 and June 30, 2020, the Company recognized interest expense of $3,952 and $4,183, respectively. This consisted of amortization of debt discount of $390 and $439 for the periods ended June 30, 2021 and June 30, 2020, respectively, and the contractual coupon interest expense of $3,562 and $3,744 for the periods ended June 30, 2021 and June 30, 2020, respectively.

The components of the carrying value of the debt as of June 30, 2021 and December 31, 2020 are detailed below:


	June 30,		December 31,
	2021		2020
Principal loan balance	$	80,000	$	75,000
Unamortized debt discount and issuance cost		(2,150)		(3,088)
Cumulative accretion of exit fee		205		331
Long-term debt, net	$	78,055	$	72,243

The annual principal payments due under the Loan Agreement as of June 30, 2021 were as follows:


Years Ending December 31,
2021 (remaining six months)	$	—
2022		—
2023		—
2024		4,445
2025		53,333
Thereafter		22,222
Total	$	80,000

WARRANTS

6 Months Ended

Jun. 30, 2021

WARRANTS

WARRANTS

10. WARRANTS

The following table summarizes the common stock warrants outstanding as of June 30, 2021 and December 31, 2020, each exercisable into the number of shares of common stock set forth below as of the specified dates:


					Shares Exercisable at
	Exercise		Expiration	Exercisable	June 30,	December 31,
Issued	Price		Date	From	2021	2020
2013	$	7.50	April 2021	July 2017	—	33,333
2014	$	7.50	November 2024	July 2017	16,000	16,000
2016	$	8.27	October 2026	September 2017	14,512	14,512
2018	$	12.18	October 2025	October 2018	184,660	184,660
					215,172	248,505

EQUITY FINANCINGS

6 Months Ended

Jun. 30, 2021

EQUITY FINANCINGS

EQUITY FINANCINGS

11. EQUITY FINANCINGS

On August 9, 2018, the Company filed a shelf registration statement on Form S-3 with the SEC, which was declared effective on August 27, 2018 (the “2018 Shelf Registration”). Under the 2018 Shelf Registration, the Company could initially offer and sell up to $250,000 of a variety of securities including common stock, preferred stock, warrants, depositary shares, debt securities, purchase contracts, purchase units or any combination of such securities during the three-year period that commenced upon the 2018 Shelf Registration becoming effective.

In connection with the filing of the 2018 Shelf Registration, the Company entered into a sales agreement (the “2018 Sales Agreement”) with Jefferies, LLC (“Jefferies”) pursuant to which the Company may issue and sell, from time to time, up to an aggregate of $50,000 of its common stock in an ATM Offering through Jefferies, as sales agent. Through the first quarter of 2020, the Company issued an aggregate of 4,945,605 shares of its common stock under the ATM Offering, resulting in net proceeds to the Company of $25,605. On March 10, 2020, the Company notified Jefferies that it was suspending and terminating the prospectus related to the 2018 Sales Agreement.

On March 11, 2020, the Company sold 16,000,000 shares of its common stock (the “2020 Offering Shares”) in an underwritten offering (the “2020 Offering”), pursuant to the 2018 Shelf Registration, at a public offering price of $7.89 per share, resulting in net proceeds of $118,207, after underwriting discounts, commissions, and offering

expenses. In addition, the underwriters of the 2020 Offering were granted the option for a period of 30 days to purchase up to an additional 2,400,000 shares of common stock offered in the public offering at the public offering price, less underwriting discounts, commissions and offering expenses. On April 3, 2020, the underwriters exercised their option and purchased an additional 979,371 shares of common stock at $7.89 per share, resulting in net proceeds to the Company of $7,216, after underwriting discounts, commissions, and offering expenses. The total number of shares sold by the Company in the 2020 Offering was 16,979,371, resulting in total net proceeds to the Company, after underwriting discounts, commissions, and offering expenses, of $125,423. Under the 2018 Shelf Registration, the Company has issued an aggregate of 30,549,976 shares of common stock, including under the ATM Offering, resulting in aggregate gross proceeds of $231,666. There was $18,334 of securities available to be issued under the 2018 Shelf Registration as of June 30, 2021.

On May 7, 2020, the Company filed a shelf registration statement on Form S-3 with the SEC, which was declared effective on May 19, 2020 (the “2020 Shelf Registration”). Under the 2020 Shelf Registration, the Company may offer and sell up to $350,000 of a variety of securities including common stock, preferred stock, warrants, depositary shares, debt securities or units during the three-year period that commenced upon the 2020 Shelf Registration becoming effective. In connection with the filing of the 2020 Shelf Registration, the Company entered into an amended and restated sales agreement with Jefferies pursuant to which it may issue and sell, from time to time, up to an aggregate of $75,000 of its common stock under its ATM Offering through Jefferies, as a sales agent. During the fourth quarter of 2020, the Company issued an aggregate of 2,821,059 shares of its common stock under the ATM Offering, resulting in net proceeds of $20,612. During the three and six months ended June 30, 2021, the Company issued and sold an additional 837,257 and 5,583,329 shares of its common stock under its ATM Offering, respectively, resulting in net proceeds of $6,021 and $40,730, respectively. As of June 30, 2021, there was $11,859 of shares of common stock remaining under the ATM Offering and, excluding the shares of common stock that may be offered under the ATM Offering, there was approximately $275,000 of securities available to be issued under the 2020 Shelf Registration.

STOCK-BASED COMPENSATION

6 Months Ended

Jun. 30, 2021

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

12. STOCK‑BASED COMPENSATION

During the six months ended June 30, 2021, the Company granted options for the purchase of 1,604,964 shares of common stock including 148,700 non-statutory stock options granted to new employees and 556,333 restricted stock units. In January 2021, employees of the Company purchased an aggregate of 74,847 shares under the ESPP. In July 2021, employees of the Company purchased an aggregate of 200,877 shares under the ESPP.

The assumptions used in determining fair value of the stock options granted during the six months ended June 30, 2021 are as follows:


	Six Months Ended June 30, 2021
Expected volatility	72.9%	–	74.2%
Risk-free interest rate	0.50%	–	1.07%
Expected dividend yield		0%
Expected term (in years)	6.03	–	6.10

During the six months ended June 30, 2021 the weighted average grant-date fair value of options granted was $4.37.

In June 2020, the Company issued 693,537 PSUs to certain executives and other employees tied to certain performance criteria, which will vest, if at all, as to 50% on the first anniversary of satisfying the performance criteria and the remaining 50% vesting upon the second anniversary of satisfying the performance criteria. The Company has determined that the performance criteria for these awards has been achieved but not all of the awards have vested as of June 30, 2021. As of June 30, 2021, a total of 1,370,830 RSUs and PSUs were outstanding, consisting of 1,282,830 unvested shares and 88,000 vested and deferred shares.

Stock-based compensation expense was classified in the condensed consolidated statements of operations and comprehensive loss as follows for the three and six months ended June 30, 2021 and 2020:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Cost of product revenues	$	37	$	9	$	71	$	28
Research and development		986		551		1,952		1,274
Selling, general and administrative		3,687		1,933		7,389		3,686
Total	$	4,710	$	2,493	$	9,412	$	4,988

INCOME TAXES

6 Months Ended

Jun. 30, 2021

INCOME TAXES

INCOME TAXES

13. INCOME TAXES

The Company did not record a provision or benefit for income taxes during the three and six months ended June 30, 2021 and 2020. The Company continues to maintain a full valuation allowance for its U.S. federal and state deferred tax assets.

The Company has evaluated the positive and negative evidence bearing upon its ability to realize the deferred tax assets. Management has considered the Company’s history of cumulative net losses incurred since inception and its generation of limited revenue from product sales since inception and has concluded that it is more likely than not that the Company will not realize the benefits of the deferred tax assets. Management reevaluates the positive and negative evidence at each reporting period.

Realization of the future tax benefits is dependent on many factors, including the Company’s ability to generate taxable income within the net operating loss carryforward period. Under the provisions of Section 382 of the Internal Revenue Code of 1986, as amended, certain substantial changes in the Company’s ownership, including a sale of the Company, or significant changes in ownership due to sales of equity, may have limited, or may limit in the future, the amount of net operating loss carryforwards, which could be used annually to offset future taxable income. The Company previously completed an analysis and determined that an ownership change has materially limited the net operating loss carryforwards and research and development tax credits available to offset future tax liabilities. The Company may be further limited by any changes that may have occurred or may occur subsequent to December 31, 2020.

The Company files its corporate income tax returns in the United States and various states. All tax years since the date of incorporation remain open to examination by the major taxing jurisdictions (state and federal) to which the Company is subject, as carryforward attributes generated in years past may still be adjusted upon examination by the Internal Revenue Service (“IRS”) or other authorities if they have or will be used in a future period. The Company is not currently under examination by the IRS or any other jurisdictions for any tax year.

As of June 30, 2021 and December 31, 2020, the Company had no uncertain tax positions. The Company’s policy is to recognize interest and penalties related to income tax matters as a component of income tax expense, of which no interest or penalties were recorded for the three and six months ended June 30, 2021 and 2020.

- 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 + Details

COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2021

COMMITMENTS AND CONTINGENCIES.

COMMITMENTS AND CONTINGENCIES.

14. COMMITMENTS AND CONTINGENCIES

License Agreement—In 2009, the Company entered into an exclusive license agreement with The Johns Hopkins University (“JHU”), as amended in November 2012, May 2014, August 2014, October 2014, June 2018 and July 2020, which licensed to the Company a portfolio of specified patent rights and remains in full force and effect. Pursuant to the terms of the agreement, as amended, the Company agreed to pay an initial license fee, minimum annual payments beginning in 2017, certain development and commercial milestone payments, royalties on product sales and reimburse all or a portion of the costs associated with the preparation, filing, prosecution and maintenance of the agreed-upon patents and patent applications to JHU.

After 2016 and until the first commercial sale of product, which occurred in January 2019, the minimum annual payment was $38. Upon the first commercial sale of INVELTYS, the annual minimum payment increased to $113. The Company is obligated to pay JHU low single-digit running royalties based upon a percentage of net sales of the licensed products, which is applied to the annual minimum payment. The Company also has an obligation to pay JHU certain one-time development and commercial milestone payments. During the three months ended June 30, 2021 and 2020, the Company paid JHU $33 and $11, respectively, in royalty payments associated with the sales of EYSUVIS and INVELTYS. During the six months ended June 30, 2021 and 2020, the Company paid JHU $55 and $23, respectively, in royalty payments associated with the sales of EYSUVIS and INVELTYS. The Company paid JHU a $150 milestone payment during the six months ended June 30, 2021, which was triggered by the first commercial sale of EYSUVIS in the United States in December 2020.

The Company recorded other expenses related to the JHU agreement of $21 and $31 for the three months ended June 30, 2021 and 2020, respectively. The Company recorded a credit for other expenses related to the JHU agreement of $30 and other expenses of $76 for the six months ended June 30, 2021 and 2020, respectively.

Litigation—The Company is not currently subject to any material legal proceedings.

Other Commitments — The Company entered into a commercial supply agreement with Woodstock Sterile Solutions, Inc. (formerly known as Catalent Pharma Solutions, LLC) to manufacture commercial supplies of EYSUVIS and INVELTYS.

The Company has the following minimum purchase obligations for EYSUVIS and INVELTYS as of June 30, 2021:


Years Ending December 31,
2021 (remaining six months)	$	2,295
2022		5,390
2023		6,285
2024		7,875
2025		8,199
Thereafter		17,925
Total minimum purchase commitments	$	47,969

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2021

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Recent Accounting Pronouncements

Recent Accounting Pronouncements

FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2021

FAIR VALUE OF FINANCIAL INSTRUMENTS

Schedule of assets and liabilities measured at fair value on a recurring basis


	June 30, 2021
	Fair Value		Level 1		Level 2		Level 3
Assets:
Cash equivalents	$	126,118	$	126,118	$	—	$	—
Short-term investments		5,000		5,000		—		—
Total Assets	$	131,118	$	131,118	$	—	$	—


	December 31, 2020
	Fair Value		Level 1		Level 2		Level 3
Assets:
Cash equivalents	$	63,811	$	63,811	$	—	$	—
Short-term investments		76,276		76,276		—		—
Total Assets	$	140,087	$	140,087	$	—	$	—

INVESTMENTS (Tables)

6 Months Ended

Jun. 30, 2021

INVESTMENTS

Schedule of investments by security type


	June 30, 2021
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
U.S. government agencies securities	$	5,000	$	—	$	—	$	5,000
Total	$	5,000	$	—	$	—	$	5,000

	December 31, 2020
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
U.S. treasury securities	$	26,744	$	2	$	—	$	26,746
U.S. government agencies securities		49,528		2		—		49,530
Total	$	76,272	$	4	$	—	$	76,276

REVENUE & ACCOUNTS RECEIVABLE, NET (Tables)

6 Months Ended

Jun. 30, 2021

REVENUE & ACCOUNTS RECEIVABLE, NET

Schedule of co-pay assistance program


	Trade Discounts,
	Allowances and				Rebates and
	Chargebacks (1)		Product Returns (2)		Incentives (3)
Balance as of December 31, 2020	$	1,157	$	600	$	4,904
Provision related to current period sales		2,201		245		10,216
Changes in estimate related to prior period sales		3		30		(26)
Credit/payments made		(1,823)		(419)		(7,880)
Balance as of March 31, 2021	$	1,538	$	456	$	7,214
Provision related to current period sales		2,103		356		11,193
Changes in estimate related to prior period sales		30		142		(353)
Credit/payments made		(2,260)		(253)		(9,801)
Balance as of June 30, 2021	$	1,411	$	701	$	8,253


	Trade Discounts,
	Allowances and				Rebates and
	Chargebacks (1)		Product Returns (2)		Incentives (3)
Balance as of December 31, 2019	$	1,783	$	180	$	10,044
Provision related to current period sales		725		—		4,576
Changes in estimate related to prior period sales		2		(66)		93
Credit/payments made		(1,114)		—		(8,090)
Balance as of March 31, 2020	$	1,396	$	114	$	6,623
Provision related to current period sales		335		—		2,194
Changes in estimate related to prior period sales		3		(51)		(234)
Credit/payments made		(1,336)		1		(3,013)
Balance as of June 30, 2020	$	398	$	64	$	5,570

(1)

(2)	Estimated provisions for product returns are deducted from gross revenues at the time revenues are recognized and are included in accrued expenses and other current liabilities on the Company’s condensed consolidated balance sheets.

(3)	Rebates and incentives include managed care rebates, government rebates, co-pay program incentives, and sales incentives and allowances. Estimated provisions for rebates and discounts are deducted from gross revenues at the

time revenues are recognized and are included in accrued expenses and other current liabilities on the Company’s condensed consolidated balance sheets.

INVENTORY (Tables)

6 Months Ended

Jun. 30, 2021

INVENTORY

Schedule of Inventory

Inventory consists of the following:


	June 30,		December 31,
	2021		2020

Raw materials	$	1,485	$	801
Work in progress		9,580		6,437
Finished goods		6,138		4,210
Total inventory	$	17,203	$	11,448

ACCRUED EXPENSES (Tables)

6 Months Ended

Jun. 30, 2021

ACCRUED EXPENSES

Schedule of accrued expenses


	June 30,		December 31,
	2021		2020

Accrued revenue reserves (1)	$	8,261	$	5,224
Compensation and benefits		8,035		9,676
Commercial costs		2,121		2,103
Contract manufacturing		773		336
Professional services		605		926
Interest		533		—
Development costs		377		154
Other		550		552
Accrued expenses	$	21,255	$	18,971

(1) There were additional revenue reserves included in accounts payable of $693 and $280, as of June 30, 2021 and December 31, 2020, respectively.

LEASES (Tables)

6 Months Ended

Jun. 30, 2021

LEASES

Schedule of lease cost

The components of lease expense and related cash flows were as follows:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Lease cost
Operating lease cost	$	1,268	$	1,185	$	2,484	$	2,371
Variable lease cost		584		658		1,093		1,068
Total lease cost	$	1,852	$	1,843	$	3,577	$	3,439

Operating cash outflows from operating leases	$	1,659	$	1,686	$	3,243	$	3,130

Schedule of weighted average remaining lease term and weighted average discount rate of operating leases

The weighted average remaining lease term and weighted average discount rate of operating leases are as follows:


	June 30,	December 31,
	2021	2020
Weighted average remaining lease term	9.9 years	10.3 years
Weighted average discount rate	9.6%	9.8%

DEBT (Tables)

6 Months Ended

Jun. 30, 2021

DEBT

Schedule of carrying value of debt

The components of the carrying value of the debt as of June 30, 2021 and December 31, 2020 are detailed below:


	June 30,		December 31,
	2021		2020
Principal loan balance	$	80,000	$	75,000
Unamortized debt discount and issuance cost		(2,150)		(3,088)
Cumulative accretion of exit fee		205		331
Long-term debt, net	$	78,055	$	72,243

Schedule of maturities of long-term debt


	June 30,		December 31,
	2021		2020
Principal loan balance	$	80,000	$	75,000
Unamortized debt discount and issuance cost		(2,150)		(3,088)
Cumulative accretion of exit fee		205		331
Long-term debt, net	$	78,055	$	72,243

WARRANTS (Tables)

6 Months Ended

Jun. 30, 2021

WARRANTS

Schedule of outstanding warrants


					Shares Exercisable at
	Exercise		Expiration	Exercisable	June 30,	December 31,
Issued	Price		Date	From	2021	2020
2013	$	7.50	April 2021	July 2017	—	33,333
2014	$	7.50	November 2024	July 2017	16,000	16,000
2016	$	8.27	October 2026	September 2017	14,512	14,512
2018	$	12.18	October 2025	October 2018	184,660	184,660
					215,172	248,505

STOCK-BASED COMPENSATION (Tables)

6 Months Ended

Jun. 30, 2021

STOCK-BASED COMPENSATION

Schedule of assumptions used in determining fair value of the stock options granted


	Six Months Ended June 30, 2021
Expected volatility	72.9%	–	74.2%
Risk-free interest rate	0.50%	–	1.07%
Expected dividend yield		0%
Expected term (in years)	6.03	–	6.10

Schedule of stock based compensation expense


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Cost of product revenues	$	37	$	9	$	71	$	28
Research and development		986		551		1,952		1,274
Selling, general and administrative		3,687		1,933		7,389		3,686
Total	$	4,710	$	2,493	$	9,412	$	4,988

COMMITMENTS AND CONTINGENCIES (Tables)

6 Months Ended

Jun. 30, 2021

COMMITMENTS AND CONTINGENCIES.

Schedule of minimum purchase obligations


Years Ending December 31,
2021 (remaining six months)	$	2,295
2022		5,390
2023		6,285
2024		7,875
2025		8,199
Thereafter		17,925
Total minimum purchase commitments	$	47,969

NATURE OF BUSINESS AND BASIS OF PRESENTATION (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Stock-based compensation
Accumulated deficit	$ (466,693)		$ (399,783)
Options
Stock-based compensation
Outstanding securities excluded from the computation of diluted weighted average shares outstanding (in shares)	10,043,748	8,573,573
RSU and PSU
Stock-based compensation
Outstanding securities excluded from the computation of diluted weighted average shares outstanding (in shares)	1,282,830	957,097
Warrants
Stock-based compensation
Outstanding securities excluded from the computation of diluted weighted average shares outstanding (in shares)	215,172	248,505

FAIR VALUE OF FINANCIAL INSTRUMENTS - Recurring and Nonrecurring Fair value Measurements Within Hierarchy (Details) - Recurring - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Financial assets by level within fair value hierarchy	$ 131,118	$ 140,087
Level 1 \| Cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Financial assets by level within fair value hierarchy	126,118	63,811
Level 1 \| Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Financial assets by level within fair value hierarchy	5,000	76,276
Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Financial assets by level within fair value hierarchy	131,118	140,087
Fair Value \| Cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Financial assets by level within fair value hierarchy	126,118	63,811
Fair Value \| Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Financial assets by level within fair value hierarchy	$ 5,000	$ 76,276

FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair value measurement levels (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2021	Dec. 31, 2020
FAIR VALUE OF FINANCIAL INSTRUMENTS
Transfer from level 1 to level 2, Assets	$ 0	$ 0	$ 0
Transfer from level 2 to level 1, Assets	0	0	0
Transfer from level 1 to level 2, Liabilities	0	0	0
Transfer from level 2 to level 1, Liabilities	0	0	0
Transfer into level 3, Assets	0	0	0
Transfer out of level 3, Assets	0	0	0
Transfer into level 3, Liability	0	0	0
Transfer out of level 3, Liability	$ 0	$ 0	$ 0

INVESTMENTS (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Investments by security type
Amortized Cost	$ 5,000	$ 76,272
Gross Unrealized Gains		4
Fair Value	5,000	76,276
U.S. treasury securities
Investments by security type
Amortized Cost		26,744
Gross Unrealized Gains		2
Fair Value		26,746
U.S. government agencies securities
Investments by security type
Amortized Cost	5,000	49,528
Gross Unrealized Gains		2
Fair Value	$ 5,000	$ 49,530

REVENUE & ACCOUNTS RECEIVABLE, NET - Co-pay Assistance Program (Details)-Q - USD ($) $ in Thousands	3 Months Ended
	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2020	Mar. 31, 2020
Trade Discounts, Allowances and Chargebacks
Beginning balance	$ 1,538	$ 1,157	$ 1,396	$ 1,783
Provision related to current period sales	2,103	2,201	335	725
Changes in estimate related to prior period sales	30	3	3	2
Credit/payments made	(2,260)	(1,823)	(1,336)	(1,114)
Ending balance	1,411	1,538	398	1,396
Product Returns
Beginning balance	456	600	114	180
Provision related to current period sales	356	245
Changes in estimate related to prior period sales	142	30	(51)	(66)
Credit/payments made	(253)	(419)	1
Ending balance	701	456	64	114
Rebates and Incentives
Beginning balance	7,214	4,904	6,623	10,044
Provision related to current period sales	11,193	10,216	2,194	4,576
Changes in estimate related to prior period sales	(353)	(26)	(234)	93
Credit/payments made	(9,801)	(7,880)	(3,013)	(8,090)
Ending balance	$ 8,253	$ 7,214	$ 5,570	$ 6,623

REVENUE & ACCOUNTS RECEIVABLE, NET - Accounts Receivable, net (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Allowance for doubtful accounts	$ 0	$ 0
Sales discounts and contractual fee for service arrangements
Allowance for doubtful accounts	$ 1,411	$ 1,157

INVENTORY (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
INVENTORY
Raw Materials	$ 1,485	$ 801
Work in Progress	9,580	6,437
Finished Goods	6,138	4,210
Total inventory	17,203	11,448
Inventory	8,046	5,229
Long-term inventory	$ 9,157	$ 6,219

ACCRUED EXPENSES (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Accrued revenue reserves (1)	$ 8,261	$ 5,224
Compensation and benefits	8,035	9,676
Commercial costs	2,121	2,103
Contract manufacturing	773	336
Professional services	605	926
Interest	533
Development costs	377	154
Other	550	552
Accrued expenses	21,255	18,971
Accounts payable
Accrued revenue reserves (1)	$ 693	$ 280

LEASES (Details) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
LEASES (Details) $ in Thousands	Jun. 30, 2021 USD ($) item	Jun. 30, 2020 USD ($)	Jun. 30, 2021 USD ($) item	Jun. 30, 2020 USD ($)	Dec. 31, 2019 USD ($) item	Dec. 31, 2020 USD ($)
Leases
Restricted cash	$ 2,742	$ 12,584	$ 2,742	$ 12,584
Variable lease cost	$ 584	658	$ 1,093	1,068
Number of vehicles leased under a master fleet lease agreement \| item					65
Number of additional vehicles leased \| item	54		54
Term of vehicle lease			3 years		3 years
Amount borrowed					$ 450
Lease cost
Operating lease cost	$ 1,268	1,185	$ 2,484	2,371
Variable lease cost	584	658	1,093	1,068
Total lease cost	1,852	1,843	3,577	3,439
Operating cash outflows from operating leases	$ 1,659	1,686	$ 3,243	3,130
Remaining lease term	9 years 10 months 24 days		9 years 10 months 24 days			10 years 3 months 18 days
Weighted average discount rate	9.60%		9.60%			9.80%
Operating Lease, Right-of-Use Asset	$ 27,953		$ 27,953			$ 27,853
Watertown Lease
Leases
Restricted cash	2,042		2,042
Variable lease cost	334	611	$ 697	1,068
Remaining lease term			10 years 3 months 18 days
Lease cost
Variable lease cost	$ 334	$ 611	$ 697	$ 1,068

DEBT - Athyrium Credit Facility (Details) $ / shares in Units, $ in Thousands			3 Months Ended		6 Months Ended		12 Months Ended
	May 04, 2021 USD ($)	Oct. 01, 2018 USD ($)	Jun. 30, 2021 USD ($) item $ / shares	Jun. 30, 2020 USD ($)	Jun. 30, 2021 USD ($) item $ / shares shares	Jun. 30, 2020 USD ($)	Dec. 31, 2020 USD ($) shares
Debt instruments
Warrant exercisable \| shares					215,172		248,505
Debt issuance costs			$ 2,218		$ 2,218
Interest expense			$ 2,091	$ 2,134	$ 4,232	$ 4,262
Warrants 2018
Debt instruments
Exercise Price \| $ / shares			$ 12.18		$ 12.18
Warrant exercisable \| shares					184,660		184,660
Athyrium Credit Facility
Debt instruments
Aggregate principal amount			$ 80,000		$ 80,000		$ 75,000
Cumulative accretion of exit fee			205		205		331
Unpaid principal balance							75,000
Unamortized debt discount							3,088,000
Prepayment fees paid	$ 2,250
Exit fees paid	$ 750
Debt issuance costs			2,150		2,150		$ 3,088
Interest expense			1,860	2,095	3,952	4,183
Amortization of debt discount			150	223	390	439
Contractual coupon interest			$ 1,710	$ 1,872	$ 3,562	$ 3,744
Athyrium
Debt instruments
Number of derivatives \| item			1		1
Athyrium \| Athyrium Credit Facility
Debt instruments
Aggregate principal amount		$ 110,000
Debt term (in years)		6 years
Additional interest rate upon an event of default accrued (as a percent)		5.00%
Athyrium \| Tranche A term loan
Debt instruments
Aggregate principal amount		$ 75,000
Athyrium \| Contingent tranche B term loan
Debt instruments
Aggregate principal amount		$ 35,000

DEBT (Details) - USD ($) $ in Thousands		3 Months Ended	6 Months Ended
DEBT (Details) - USD ($) $ in Thousands	May 04, 2021	Jun. 30, 2021	Jun. 30, 2021	Dec. 31, 2020
Debt instruments
Loss of extinguishment of debt	$ 5,395	$ 5,395	$ 5,395
Athyrium Credit Facility
Debt instruments
Aggregate principal amount		$ 80,000	$ 80,000	$ 75,000
Exit fees paid	750
Loan and Security Agreement with Oxford Finance LLC
Debt instruments
Aggregate principal amount	$ 125,000
Floating interest rate (as a percent)	0.11%
Facility fees paid	$ 400
Percentage of final payment fees	7.00%
Effective interest rate		10.41%	10.41%
Loan and Security Agreement with Oxford Finance LLC \| Neither the tranche B term loan nor the tranche C term loan is made
Debt instruments
Duration of periodic monthly payment installments under a scenario	18 months
Loan and Security Agreement with Oxford Finance LLC \| Either tranche B term loan nor tranche C term loan is made
Debt instruments
Duration of periodic monthly payment installments under a scenario	12 months
Loan and Security Agreement with Oxford Finance LLC \| Advance is prepaid during the first 12 months following the applicable advance date
Debt instruments
Percentage of pre-payment fees	3.00%
Loan and Security Agreement with Oxford Finance LLC \| Advance is prepaid after 12 months but prior to 24 months following the applicable advance date
Debt instruments
Percentage of pre-payment fees	2.00%
Loan and Security Agreement with Oxford Finance LLC \| Advance is prepaid any time after 24 months following the applicable advance date but prior to the Maturity Date
Debt instruments
Percentage of pre-payment fees	1.00%
Loan and Security Agreement with Oxford Finance LLC \| 30-day LIBOR
Debt instruments
Spread on variable rate	7.89%
Tranche A term loan
Debt instruments
Aggregate principal amount	$ 80,000
Contingent tranche B term loan
Debt instruments
Aggregate principal amount	$ 20,000
Revenue achievement trailing period	6 months
Minimum target revenue	$ 75,000
Facility fees paid	100
Contingent tranche C term loan
Debt instruments
Aggregate principal amount	$ 25,000
Revenue achievement trailing period	6 months
Minimum target revenue	$ 100,000
Facility fees paid	$ 125

DEBT - Carrying Value (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Debt instruments
Unamortized debt discount and issuance cost	$ (2,218)
Long-term debt, net	78,055	$ 72,243
Athyrium Credit Facility
Debt instruments
Principal Loan Balance	80,000	75,000
Unamortized debt discount and issuance cost	(2,150)	(3,088)
Cumulative accretion of exit fee	205	331
Long-term debt, net	$ 78,055	$ 72,243

DEBT - Future annual principal payments (Details) - Athyrium Credit Facility $ in Thousands	Jun. 30, 2021 USD ($)
Maturities of long-term debt
2024	$ 4,445
2025	53,333
Thereafter	22,222
Total	$ 80,000

WARRANTS (Details) - $ / shares	6 Months Ended	12 Months Ended
WARRANTS (Details) - $ / shares	Jun. 30, 2021	Dec. 31, 2020
Preferred stock warrants
Shares Exercisable	215,172	248,505
Warrants 2013
Preferred stock warrants
Exercise Price	$ 7.50
Shares Exercisable		33,333
Warrants 2014
Preferred stock warrants
Exercise Price	$ 7.50
Shares Exercisable	16,000	16,000
Warrants 2016
Preferred stock warrants
Exercise Price	$ 8.27
Shares Exercisable	14,512	14,512
Warrants 2018
Preferred stock warrants
Exercise Price	$ 12.18
Shares Exercisable	184,660	184,660

EQUITY FINANCINGS (Details) - USD ($) $ / shares in Units, $ in Thousands						3 Months Ended				6 Months Ended
	May 07, 2020	Apr. 03, 2020	Mar. 11, 2020	Oct. 05, 2018	Aug. 27, 2018	Jun. 30, 2021	Dec. 31, 2020	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2021	Jun. 30, 2020
Equity Offerings
Common stock offering, net of offering costs								$ 7,216			$ 125,423
Net proceeds										$ 40,730	137,969
Offering costs								$ 464			$ 8,475
Underwriter's option
Equity Offerings
Common stock offering, net of offering costs (in shares)		979,371	2,400,000
Net proceeds		$ 7,216
Period granted			30 days
Price per share		$ 7.89
Shelf Registration
Equity Offerings
Additional authorized value of securities						$ 275,000				$ 275,000
Common stock offering, net of offering costs (in shares)										30,549,976
Common stock offering, net of offering costs										$ 231,666
Share authorized value (shelf)						18,334				18,334
Registration period	3 years				3 years
Sales agreement				$ 50,000
Shelf Registration \| Maximum
Equity Offerings
Additional authorized value of securities	$ 350,000				$ 250,000
2020 Offering
Equity Offerings
Common stock offering, net of offering costs (in shares)		16,979,371	16,000,000
Price per share			$ 7.89
Net proceeds		$ 125,423	$ 118,207
ATM
Equity Offerings
Additional authorized value of securities						$ 11,859				$ 11,859
Common stock offering, net of offering costs (in shares)						837,257	2,821,059		4,945,605	5,583,329
Common stock offering, net of offering costs						$ 6,021	$ 20,612			$ 40,730
Net proceeds									$ 25,605
ATM \| Maximum
Equity Offerings
Additional authorized value of securities	$ 75,000

STOCK-BASED COMPENSATION - Inducement Stock Option Awards (Details) - $ / shares	1 Months Ended		6 Months Ended
	Jul. 31, 2021	Jan. 31, 2021	Jun. 30, 2021
Stock-based compensation
Granted (in shares)			1,604,964
Weighted average grant date fair value of options granted			$ 4.37
ESPP
Stock-based compensation
Issuance of common stock under employee stock purchase plan (in shares)	200,877	74,847
Non-statutory Stock Options
Stock-based compensation
Granted (in shares)			148,700
RSU
Stock-based compensation
Granted (in shares)			556,333

STOCK-BASED COMPENSATION - Fair Value Assumptions (Details)	6 Months Ended
	Jun. 30, 2021
Assumptions used in determining fair value of the stock options granted
Expected volatility (minimum)	72.90%
Expected volatility (maximum)	74.20%
Risk-free interest rate (minimum)	0.50%
Risk-free interest rate (maximum)	1.07%
Expected dividend yield	0.00%
Minimum
Assumptions used in determining fair value of the stock options granted
Expected term (in years)	6 years 10 days
Maximum
Assumptions used in determining fair value of the stock options granted
Expected term (in years)	6 years 1 month 6 days

STOCK-BASED COMPENSATION - RSU and PSU (Details)	1 Months Ended	6 Months Ended
STOCK-BASED COMPENSATION - RSU and PSU (Details)	Jun. 30, 2020 shares	Jun. 30, 2021 USD ($) shares
RSU and PSU
Stock-based compensation
Outstanding balance at end of period (in shares)		1,370,830
Unvested outstanding balance at end of period (in shares) \| $		1,282,830
Vested outstanding balance at end of period (in shares)		88,000
Executive Officer \| PSU \| First anniversary
Stock-based compensation
Granted (in shares)	693,537
Vesting percentage	50.00%
Executive Officer \| PSU \| Second anniversary
Stock-based compensation
Vesting percentage	50.00%

STOCK-BASED COMPENSATION - Stock-based compensation expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Stock-based compensation
Stock based compensation expense	$ 4,710	$ 2,493	$ 9,412	$ 4,988
Cost of product revenues
Stock-based compensation
Stock based compensation expense	37	9	71	28
Research and development
Stock-based compensation
Stock based compensation expense	986	551	1,952	1,274
Selling, general and administrative
Stock-based compensation
Stock based compensation expense	$ 3,687	$ 1,933	$ 7,389	$ 3,686

INCOME TAXES (Details) - USD ($)	3 Months Ended		6 Months Ended
INCOME TAXES (Details) - USD ($)	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
INCOME TAXES
Uncertain tax positions	$ 0		$ 0		$ 0
Interest or penalties recorded	$ 0	$ 0	$ 0	$ 0

COMMITMENTS AND CONTINGENCIES - License Agreement (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Contingencies
Research and development expenses	$ 3,094	$ 6,053	$ 6,220	$ 11,487
The Johns Hopkins University ("JHU")
Contingencies
Minimum annual payment			38
License fee, if the company achieves the first commercial sale			113
First commercial sale milestone	33	11	55	23
Milestone payment			150
Other expenses	$ 21	$ 31	$ 30	$ 76

COMMITMENTS AND CONTINGENCIES - Future minimum obligations (Details) $ in Thousands	Jun. 30, 2021 USD ($)
Minimum obligations due under its license agreements
2021 (remaining six months)	$ 2,295
2022	5,390
2023	6,285
2024	7,875
2025	8,199
Thereafter	17,925
Total minimum license payments	$ 47,969