Document and Entity Information
9 Months Ended
Sep. 30, 2017
Nov. 8, 2017
Document And Entity Information [Abstract]
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Sep. 30, 2017 
 
Document Fiscal Year Focus
2017 
 
Document Fiscal Period Focus
Q3 
 
Trading Symbol
AQXP 
 
Entity Registrant Name
AQUINOX PHARMACEUTICALS, INC 
 
Entity Central Index Key
0001404644 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Smaller Reporting Company 
 
Entity Common Stock, Shares Outstanding
 
23,464,930 
Condensed consolidated balance sheets (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Current assets
 
 
Cash and cash equivalents (Note 3)
$ 47,105 
$ 32,301 
Short-term investments (Note 8)
72,590 
70,758 
Receivables, prepayments and deposits
878 
426 
Total current assets
120,573 
103,485 
Property and equipment, net
1,029 
849 
Long-term investments (Note 8)
 
50,046 
Total assets
121,602 
154,380 
Current liabilities
 
 
Accounts payable and other liabilities
6,997 
9,519 
Total current liabilities
6,997 
9,519 
Other liabilities (Note 4)
513 
197 
Total liabilities
7,510 
9,716 
Share capital: (Note 5)
 
 
Common stock
Additional paid-in capital
296,429 
293,111 
Accumulated deficit
(182,234)
(148,278)
Accumulated other comprehensive loss
(103)
(169)
Total stockholders' equity
114,092 
144,664 
Total liabilities and stockholders' equity
$ 121,602 
$ 154,380 
Condensed consolidated balance sheets (Parenthetical) (USD $)
Sep. 30, 2017
Dec. 31, 2016
Statement of Financial Position [Abstract]
 
 
Common stock, par value
$ 0.000001 
$ 0.000001 
Common stock, shares authorized
50,000,000 
50,000,000 
Common stock, shares issued
23,464,930 
23,423,150 
Common stock, shares outstanding
23,464,930 
23,423,150 
Condensed consolidated statements of operations and comprehensive loss (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Operating expenses
 
 
 
 
Research and development
$ 8,456 
$ 6,134 
$ 24,708 
$ 20,250 
General and administrative
3,614 
2,149 
9,879 
5,932 
Total operating expenses
12,070 
8,283 
34,587 
26,182 
Other income, net (Note 6)
237 
137 
672 
424 
Net loss
(11,833)
(8,146)
(33,915)
(25,758)
Net loss per common stock - basic and diluted (Note 7)
$ (0.50)
$ (0.46)
$ (1.45)
$ (1.48)
Basic and diluted weighted average number of common stock outstanding
23,464,785 
17,690,362 
23,444,181 
17,372,616 
Comprehensive loss:
 
 
 
 
Net loss
(11,833)
(8,146)
(33,915)
(25,758)
Other comprehensive income (loss) - unrealized gain (loss) on available-for-sale securities
102 
(80)
66 
282 
Comprehensive loss
$ (11,731)
$ (8,226)
$ (33,849)
$ (25,476)
Condensed consolidated statements of cash flows (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Operating activities
 
 
Net loss
$ (33,915)
$ (25,758)
Non-cash items:
 
 
Change in fair value of derivative liability (Note 6)
 
(81)
Stock-based compensation (Note 5(c))
2,868 
1,405 
Unrealized foreign exchange loss and others
481 
122 
Changes in operating assets and liabilities:
 
 
Receivable, prepayments and deposits
(444)
(357)
Accounts payable and other liabilities
(2,103)
3,440 
Cash used in operating activities
(33,113)
(21,229)
Investing activities
 
 
Purchase of investments
(5,995)
(56,336)
Proceeds from maturity of investments
54,000 
53,598 
Purchase of property and equipment
(478)
(616)
Cash provided by (used in) investing activities
47,527 
(3,354)
Financing activities
 
 
Proceeds from exercise of stock options
380 
440 
Payment on capital lease obligations
(11)
(2)
Public offering of common stock
 
75,368 
Public offering costs
 
(4,531)
Cash provided by financing activities
369 
71,275 
Effect of exchange rate changes on cash and cash equivalents
21 
Net change in cash and cash equivalents during the period
14,804 
46,699 
Cash and cash equivalents, beginning of period
32,301 
39,526 
Cash and cash equivalents, end of period
47,105 
86,225 
Supplemental disclosure of cash flow information:
 
 
Interest received
996 
481 
Non-cash investing and financing activities:
 
 
Accrued purchase of property & equipment
(77)
103 
Assets acquired through capital leases
 
35 
Accrued offering costs
(30)
306 
Exercise of warrants on a net settlement basis
 
$ (43)
Nature of operations
Nature of operations

1. Nature of operations

Aquinox Pharmaceuticals, Inc. and its subsidiary, Aquinox Pharmaceuticals (Canada) Inc., (consolidated, the “Company”) is a clinical stage pharmaceutical company discovering and developing targeted therapeutics in disease areas of inflammation and immuno-oncology. The Company’s primary focus is anti-inflammatory product candidates targeting SHIP1 (SH2-containing inositol-5’-phosphatase 1), which is a key regulator of an important cellular signaling pathway in immune cells, known as the PI3K pathway.

Aquinox Pharmaceuticals, Inc. was originally incorporated under the name of Aquinox Pharmaceuticals (USA) Inc. on May 31, 2007 in the State of Delaware, United States. On January 27, 2014, Aquinox Pharmaceuticals (USA) Inc. changed its name to Aquinox Pharmaceuticals, Inc. (“Aquinox USA”).

Aquinox Pharmaceuticals (Canada) Inc. (“AQXP Canada”) was originally incorporated under the name of 6175813 Canada Inc. on December 26, 2003 under the Canada Business Corporations Act. In May 2014, after a corporate restructuring, the name was changed to Aquinox Pharmaceuticals (Canada) Inc.

The Company operates in Vancouver, British Columbia, Canada and San Bruno, California.

Condensed summary of significant accounting policies
Condensed summary of significant accounting policies

2. Condensed summary of significant accounting policies

(a) Basis of presentation

The accompanying unaudited condensed consolidated financial statements are presented in United States (“U.S.”) dollars and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, these financial statements do not include all of the information and footnotes required for complete financial statements and should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 filed with the Securities and Exchange Commission on March 9, 2017.

In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position as of September 30, 2017, and results of operations and cash flows for all periods presented. The interim results presented are not necessarily indicative of results that can be expected for a full year.

(b) Use of estimates and assumptions

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Significant areas requiring management estimates include valuation of stock options and warrants, amortization and depreciation, accrual of expenses, valuation allowance for deferred income taxes, and contingencies. Actual results could differ from those estimates.

(c) Short and long-term investments

Short-term investments consist of bank term deposits and U.S. government securities with initial maturities of less than a year. Long-term investments consist of U.S. government securities with initial maturities of greater than a year. Short-term investments and long-term investments are both classified as available-for-sale and carried at their estimated fair value with unrealized gains and losses recorded as a component of other comprehensive loss. Realized gains and losses are recorded in net loss. The Company periodically reviews its investments for impairment and when a decline in market value is deemed to be other than temporary, the loss is recognized in net loss.

 

(d) Accounting for stock-based compensation

The Company measures the cost of services received in exchange for an award of equity instruments based on the grant-date fair value of the award. The cost of such award will be recognized over the period during which services are provided in exchange for the award, generally the vesting period. All share-based payments to employees are recognized in the consolidated financial statements based upon their respective grant date fair values.

The Company estimates the fair value of options granted using the Black-Scholes option pricing model. This approximation uses assumptions regarding a number of inputs that requires management to make significant estimates and judgments. Prior to the completion of the Company’s initial public offering in March 2014, the Company’s common stock was not publicly traded. As a result, the expected volatility assumption is based on industry peer information due to insufficient trading history of the Company’s common stock. Additionally, because the Company has no significant history to calculate the expected term, the simplified method calculation is used.

(e) Segment reporting

The Company operates in one segment, the identification and development of therapeutics for inflammatory diseases and cancer. The Company has significant Canadian operations but its assets are mostly held in the United States with an immaterial amount of long lived assets in Canada.

(f) Net loss per common stock

Basic net loss per common stock is computed by dividing loss by the weighted-average number of common stock outstanding during the period. Diluted net loss per common stock is determined using the weighted-average number of common stock outstanding during the period, adjusted for the dilutive effect of common stock equivalents, consisting of shares that might be issued upon exercise of common stock options and warrants. In periods where losses are reported, the weighted-average number of shares of common stock outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.

(g) Recently issued and recently adopted accounting standards

The Company adopted FASB ASU 2015-17 “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes,” effective January 1, 2017 which requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. The previous guidance required entities to separately present deferred tax assets and deferred tax liabilities as current or noncurrent in a classified balance sheet. This change did not have a material impact on the Company’s financial statements as a full valuation allowance has been applied against the deferred tax assets.

The Company adopted FASB ASU 2016-09 “Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting,” effective January 1, 2017 which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The Company has elected to change its accounting policy to account for forfeitures as they occur instead of on an estimated basis as this will more accurately reflect the cost of forfeitures. The change has been applied on a modified retrospective approach with a cumulative-effect adjustment to retained deficit of an immaterial amount as of January 1, 2017. The provisions relating to the accounting for income taxes has no significant impact on the consolidated financial statements as the Company applies a full valuation allowance against its deferred tax assets.

In January 2016, the FASB issued ASU 2016-01 “Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities,” which revises an entity’s accounting related to (1) the classification and measurement of investments in equity securities and (2) the presentation of certain fair value changes for financial liabilities measured at fair value. The ASU also amends certain disclosure requirements associated with the fair value of financial instruments. ASU 2016-01 is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2017, with early adoption permitted under certain circumstances. The Company does not anticipate a material impact to the Company’s financial statements as a result of this adoption.

In February 2016, the FASB issued ASU 2016-02 “Leases (Topic 842)”, which requires the recognition of right-of-use assets and lease liabilities by lessees for those leases with a lease term of greater than 12 months. Upon the adoption of ASU 2016-02, leases will be recognized and measured at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients that companies may elect to apply. ASU 2016-02 is effective for fiscal years and interim periods beginning after December 15, 2018, with early adoption permitted. The Company is currently assessing the impact of ASU 2016-02 on the Company’s financial statements and whether to elect to apply the optional practical expedients under the modified retrospective approach.

 

(h) Risks and uncertainties

The Company is subject to numerous risks and uncertainties. These risks, among others, included the following:

 

    the Company has no source of revenue, had an accumulated deficit of $182.2 million as of September 30, 2017, may never become profitable and may incur substantial and increasing net losses for the foreseeable future as it continues development of, seeks regulatory approvals for, and potentially begins to commercialize rosiptor, its lead product candidate, and any future product candidates;

 

    the Company is likely to require additional capital to finance its operations which may not be available to it on acceptable terms, or at all;

 

    the Company’s success is primarily dependent on the successful development, regulatory approval and commercialization of rosiptor, its lead product candidate, and any future product candidates;

 

    SHIP1 has not been validated as a target for the treatment of any disease;

 

    the Company is subject to regulatory approval processes that are lengthy, time consuming and inherently unpredictable; the Company may not be able to obtain approval for rosiptor or any future product candidates from the U.S. Food and Drug Administration, or FDA, or foreign regulatory authorities;

 

    the Company’s intellectual property rights may be subject to claims by third parties and can be difficult and costly to protect;

 

    the Company may not be able to recruit or retain key employees, including its senior management team;

 

    the Company depends on the performance of third parties, including contract research organizations and third-party manufacturers; and

 

    the Company faces competition from other pharmaceutical and biotechnology companies, academic institutions, governmental agencies, and public and private research institutions, among others.

Cash and cash equivalents
Cash and cash equivalents

3. Cash and cash equivalents

 

(in thousands)    SEPTEMBER 30,
2017
     DECEMBER 31,
2016
 

Cash

   $ 23,538      $ 3,726  

Cash equivalents

     23,567        28,575  
  

 

 

    

 

 

 
   $ 47,105      $ 32,301  
  

 

 

    

 

 

 

Other liabilities
Other liabilities

4. Other liabilities

 

(in thousands)    SEPTEMBER 30,
2017
     DECEMBER 31,
2016
 

Capital lease obligations

   $ 37      $ 47  

Deferred rent liability

     476        150  
  

 

 

    

 

 

 
   $ 513      $ 197  
  

 

 

    

 

 

 

Stockholders' equity
Stockholders' equity

5. Stockholders’ equity

(a) Share capital

Aquinox USA is authorized to issue two classes of stock, common and preferred. The total number of shares Aquinox USA is authorized to issue is 55,000,000 shares, comprised of 50,000,000 common stock and 5,000,000 preferred stock both with a par value of $0.000001 per share. As of September 30, 2017 and December 31, 2016, the total number of shares of common stock issued and outstanding was 23,464,930 and 23,423,150, respectively. As of September 30, 2017 and December 31, 2016, no shares of preferred stock were issued or outstanding.

 

(b) Stock option plan

On January 27, 2014, the stockholders of Aquinox USA approved a 2014 Equity Incentive Plan (“2014 Plan”). The 2014 Plan became effective on March 6, 2014. The 2014 Plan is the successor to and continuation of the Joint Canadian Stock Option Plan (the “2006 Plan”). No further grants will be made under the 2006 Plan. The 2014 Plan provides for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance stock awards, performance cash awards, and other forms of equity awards to employees, directors, and consultants.

As at September 30, 2017, the maximum number of shares of common stock that may be issued under the 2014 Plan was 2,863,908 shares. Additionally, the number of shares of common stock reserved for issuance under the 2014 Plan will automatically increase on January 1 of each year for a period of up to 10 years, beginning on January 1, 2015 and ending on and including January 1, 2024, by 4% of the total number of shares of capital outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the board of directors.

Stock option transactions and the number of stock options outstanding are summarized below:

 

     NUMBER OF
SHARES
     WEIGHTED
AVERAGE
EXERCISE PRICE
     WEIGHTED
AVERAGE
REMAINING
CONTRACTUAL
LIFE

(IN YEARS)
     AGGREGATE
INTRINSIC
VALUE

(IN
THOUSANDS)
 

Outstanding at December 31, 2016

     1,378,352      $ 9.38        7.81      $ 9,829  

Options granted

     796,790        16.92        

Options exercised

     (41,780      9.35        

Options forfeited

     (59,820      12.42        
  

 

 

    

 

 

    

 

 

    

 

 

 

Outstanding at September 30, 2017

     2,073,542      $ 12.19        7.99      $ 6,280  
  

 

 

    

 

 

    

 

 

    

 

 

 

Exercisable as of September 30, 2017

     837,318      $ 9.39        6.43      $ 4,021  
  

 

 

    

 

 

    

 

 

    

 

 

 

During the nine months ended September 30, 2017, the Company granted 715,790 stock options to employees and 81,000 stock options to non-employee directors. The stock options granted to employees during the nine months ended September 30, 2017 have exercise prices per share ranging from $13.74 to $17.35 and vest 25% one year after the beginning of the vesting period and thereafter ratably each month over the following thirty-six months. The stock options granted to non-employee directors during the nine months ended September 30, 2017 have an exercise price per share of $13.74 and have a vesting period of one year in equal monthly installments from the beginning of the vesting period for certain grants and a vesting period of three years in equal annual installments from the beginning of the vesting period for other grants. All stock options under the 2014 Plan are subject to a 10-year expiration period.

During the three and nine months ended September 30, 2017, 218 and 41,780 shares of common stock were issued upon exercise of options, respectively.

 

(c) Stock-based compensation

The fair value of stock options granted is estimated using the Black-Scholes option pricing model with the following weighted average assumptions:

 

     THREE MONTHS ENDED
SEPTEMBER 30,
    NINE MONTHS ENDED
SEPTEMBER 30,
 
     2017     2016     2017     2016  

Expected volatility

     91     87     91     81

Expected dividends

     0     0     0     0

Expected terms (years)

     6.00       6.00       6.00       6.00  

Risk free rate

     1.87     1.07     1.89     1.23

Weighted average grant-date fair value of stock options

   $ 11.13     $ 6.50     $ 12.69     $ 5.76  

The Company amortizes the fair value of the stock options on a straight-line basis over the applicable requisite service periods of the awards, which is generally the vesting period. Stock-based compensation expense charged to operating expenses was $1.2 million and $2.9 million for the three and nine months ended September 30, 2017, respectively, and $0.5 million and $1.4 million for the three and nine months ended September 30, 2016, respectively. Total unrecognized compensation cost for all stock-based compensation plans was $11.6 million and $4.4 million as of September 30, 2017 and September 30, 2016, respectively, which is expected to be recognized over a weighted-average period of 2.88 years (September 30, 2016 – 2.89 years).

Other income, net
Other income, net

6. Other income, net

 

(in thousands)    THREE MONTHS ENDED
SEPTEMBER 30,
    NINE MONTHS ENDED
SEPTEMBER 30,
 
     2017     2016     2017     2016  

Change in fair value of derivative liability

   $ —       $ 8     $ —       $ 81  

Foreign exchange gain (losses)

     8       (1     (12     (21

Interest income

     236       142       720       391  

Miscellaneous expenses

     (7     (12     (36     (27
  

 

 

   

 

 

   

 

 

   

 

 

 
   $ 237     $ 137     $ 672     $ 424  
  

 

 

   

 

 

   

 

 

   

 

 

Net loss per common stock
Net loss per common stock

7. Net loss per common stock

Basic and diluted net loss per common stock is computed by dividing net loss by the weighted average number of common stock outstanding. The Company excluded outstanding stock options to purchase 2,073,542 shares for the three and nine months ended September 30, 2017 and 1,293,602 shares for the three and nine months ended September 30, 2016 from the computation of basic and diluted net loss per common stock as the effect would have been antidilutive for all periods presented.

Financial instruments
Financial instruments

8. Financial instruments

Securities classified as available for sale

The Company’s short-term investments and long-term investments consisted of available-for-sale securities as follows:

 

(in thousands)    Amortized
cost
     Gross
unrealized
gains
     Gross
unrealized
losses
     Fair value  

September 30, 2017

           

Short-term investments:

           

U.S. treasury securities

   $ 72,693      $ —        $ (103    $ 72,590  
  

 

 

    

 

 

    

 

 

    

 

 

 

Contractual maturities:

           

Due within one year

   $ 72,693            $ 72,590  

December 31, 2016

           
     Amortized
cost
     Gross
unrealized
gains
     Gross
unrealized
losses
     Fair value  

Short-term investments:

           

U.S. treasury securities

   $ 70,819      $ —        $ (61    $ 70,758  
  

 

 

    

 

 

    

 

 

    

 

 

 

Long-term investments:

           

U.S. treasury securities

   $ 50,155      $ —        $ (109    $ 50,046  
  

 

 

    

 

 

    

 

 

    

 

 

 

Contractual maturities:

           

Due within one year

   $ 70,819            $ 70,758  

Due after one year through two years

     50,155              50,046  

The aggregate estimated fair value of the Company’s investments with unrealized losses are as follows:

 

(in thousands)    Period of continuous unrealized loss  
     12 months or less      Greater than 12 months  
     Fair value      Gross
unrealized
losses
     Fair value      Gross
unrealized
losses
 

September 30, 2017

           

U.S. treasury securities

   $ 61,527      $ (99    $ 11,063      $ (4

December 31, 2016

           

U.S. treasury securities

   $ 120,804      $ (170      N/A        N/A  

Fair value of financial instruments

Fair value is defined as the amounts that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The fair value of the Company’s financial instruments are determined according to a fair value hierarchy that prioritizes the inputs and assumptions used, and the valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the hierarchy are as follows:

 

Level 1  -   Quoted prices in active markets for identical assets or liabilities.
Level 2  -   Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3  -   Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

 

The determination of a financial instrument’s level within the fair value hierarchy is based on an assessment of the lowest level of any input that is significant to the fair value measurement. The Company considers observable data to be market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market.

The carrying amounts of certain of the Company’s financial instruments including cash, cash equivalents, receivables, accounts payable and other liabilities, approximate their fair values because of their nature and/or short maturities. The Company holds short and long-term investments that are classified as available-for-sale securities, which are measured at fair value determined on a recurring basis according to the fair value hierarchy.

The following tables present the fair value of our financial instruments that are measured at fair value on a recurring basis:

 

(in thousands)    QUOTED
PRICES IN
ACTIVE
MARKETS
FOR
IDENTICAL
ASSETS

(LEVEL 1)
     OTHER
OBSERVABLE
INPUTS

(LEVEL 2)
     SIGNIFICANT
UN-OBSERVABLE
INPUTS

(LEVEL 3)
     TOTAL  

BALANCES – September 30, 2017

           

Short-term investments – U.S. treasury securities

   $ 72,590      $ —        $ —        $ 72,590  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 72,590      $ —        $ —        $ 72,590  
  

 

 

    

 

 

    

 

 

    

 

 

 

BALANCES – December 31, 2016

           

Short-term investments – U.S. treasury securities

   $ 70,758      $ —        $ —        $ 70,758  

Long-term investments – U.S. treasury securities

     50,046        —          —          50,046  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 120,804      $ —        $ —        $ 120,804  
  

 

 

    

 

 

    

 

 

    

 

 

 

Level 1 instruments, which include investments that are valued based on quoted market prices in active markets, consisted of U.S. treasury securities. The Company had no Level 2 or 3 investments as at September 30, 2017 and December 31, 2016. There were no transfers between Levels 1, 2, and 3 during the three and nine months ended September 30, 2017 and the year ended December 31, 2016.

As at September 30, 2017, the Company had short-term investments consisting of available-for-sale securities of $72.6 million. Total gains for securities were $0.3 million and $0.7 million for the three and nine months ended September 30, 2017, respectively and $0.2 million and $0.4 million for the three and nine months ended September 30, 2016, respectively.

Condensed summary of significant accounting policies (Policies)

(a) Basis of presentation

The accompanying unaudited condensed consolidated financial statements are presented in United States (“U.S.”) dollars and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, these financial statements do not include all of the information and footnotes required for complete financial statements and should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 filed with the Securities and Exchange Commission on March 9, 2017.

In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position as of September 30, 2017, and results of operations and cash flows for all periods presented. The interim results presented are not necessarily indicative of results that can be expected for a full year.

(b) Use of estimates and assumptions

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Significant areas requiring management estimates include valuation of stock options and warrants, amortization and depreciation, accrual of expenses, valuation allowance for deferred income taxes, and contingencies. Actual results could differ from those estimates.

(c) Short and long-term investments

Short-term investments consist of bank term deposits and U.S. government securities with initial maturities of less than a year. Long-term investments consist of U.S. government securities with initial maturities of greater than a year. Short-term investments and long-term investments are both classified as available-for-sale and carried at their estimated fair value with unrealized gains and losses recorded as a component of other comprehensive loss. Realized gains and losses are recorded in net loss. The Company periodically reviews its investments for impairment and when a decline in market value is deemed to be other than temporary, the loss is recognized in net loss.

(d) Accounting for stock-based compensation

The Company measures the cost of services received in exchange for an award of equity instruments based on the grant-date fair value of the award. The cost of such award will be recognized over the period during which services are provided in exchange for the award, generally the vesting period. All share-based payments to employees are recognized in the consolidated financial statements based upon their respective grant date fair values.

The Company estimates the fair value of options granted using the Black-Scholes option pricing model. This approximation uses assumptions regarding a number of inputs that requires management to make significant estimates and judgments. Prior to the completion of the Company’s initial public offering in March 2014, the Company’s common stock was not publicly traded. As a result, the expected volatility assumption is based on industry peer information due to insufficient trading history of the Company’s common stock. Additionally, because the Company has no significant history to calculate the expected term, the simplified method calculation is used.

(e) Segment reporting

The Company operates in one segment, the identification and development of therapeutics for inflammatory diseases and cancer. The Company has significant Canadian operations but its assets are mostly held in the United States with an immaterial amount of long lived assets in Canada.

(f) Net loss per common stock

Basic net loss per common stock is computed by dividing loss by the weighted-average number of common stock outstanding during the period. Diluted net loss per common stock is determined using the weighted-average number of common stock outstanding during the period, adjusted for the dilutive effect of common stock equivalents, consisting of shares that might be issued upon exercise of common stock options and warrants. In periods where losses are reported, the weighted-average number of shares of common stock outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.

(g) Recently issued and recently adopted accounting standards

The Company adopted FASB ASU 2015-17 “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes,” effective January 1, 2017 which requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. The previous guidance required entities to separately present deferred tax assets and deferred tax liabilities as current or noncurrent in a classified balance sheet. This change did not have a material impact on the Company’s financial statements as a full valuation allowance has been applied against the deferred tax assets.

The Company adopted FASB ASU 2016-09 “Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting,” effective January 1, 2017 which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The Company has elected to change its accounting policy to account for forfeitures as they occur instead of on an estimated basis as this will more accurately reflect the cost of forfeitures. The change has been applied on a modified retrospective approach with a cumulative-effect adjustment to retained deficit of an immaterial amount as of January 1, 2017. The provisions relating to the accounting for income taxes has no significant impact on the consolidated financial statements as the Company applies a full valuation allowance against its deferred tax assets.

In January 2016, the FASB issued ASU 2016-01 “Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities,” which revises an entity’s accounting related to (1) the classification and measurement of investments in equity securities and (2) the presentation of certain fair value changes for financial liabilities measured at fair value. The ASU also amends certain disclosure requirements associated with the fair value of financial instruments. ASU 2016-01 is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2017, with early adoption permitted under certain circumstances. The Company does not anticipate a material impact to the Company’s financial statements as a result of this adoption.

In February 2016, the FASB issued ASU 2016-02 “Leases (Topic 842)”, which requires the recognition of right-of-use assets and lease liabilities by lessees for those leases with a lease term of greater than 12 months. Upon the adoption of ASU 2016-02, leases will be recognized and measured at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients that companies may elect to apply. ASU 2016-02 is effective for fiscal years and interim periods beginning after December 15, 2018, with early adoption permitted. The Company is currently assessing the impact of ASU 2016-02 on the Company’s financial statements and whether to elect to apply the optional practical expedients under the modified retrospective approach.

(h) Risks and uncertainties

The Company is subject to numerous risks and uncertainties. These risks, among others, included the following:

 

    the Company has no source of revenue, had an accumulated deficit of $182.2 million as of September 30, 2017, may never become profitable and may incur substantial and increasing net losses for the foreseeable future as it continues development of, seeks regulatory approvals for, and potentially begins to commercialize rosiptor, its lead product candidate, and any future product candidates;

 

    the Company is likely to require additional capital to finance its operations which may not be available to it on acceptable terms, or at all;

 

    the Company’s success is primarily dependent on the successful development, regulatory approval and commercialization of rosiptor, its lead product candidate, and any future product candidates;

 

    SHIP1 has not been validated as a target for the treatment of any disease;

 

    the Company is subject to regulatory approval processes that are lengthy, time consuming and inherently unpredictable; the Company may not be able to obtain approval for rosiptor or any future product candidates from the U.S. Food and Drug Administration, or FDA, or foreign regulatory authorities;

 

    the Company’s intellectual property rights may be subject to claims by third parties and can be difficult and costly to protect;

 

    the Company may not be able to recruit or retain key employees, including its senior management team;

 

    the Company depends on the performance of third parties, including contract research organizations and third-party manufacturers; and

 

    the Company faces competition from other pharmaceutical and biotechnology companies, academic institutions, governmental agencies, and public and private research institutions, among others.

Cash and cash equivalents (Tables)
Schedule of Cash and Cash Equivalents


 

(in thousands)    SEPTEMBER 30,
2017
     DECEMBER 31,
2016
 

Cash

   $ 23,538      $ 3,726  

Cash equivalents

     23,567        28,575  
  

 

 

    

 

 

 
   $ 47,105      $ 32,301  
  

 

 

    

 

 

 

Other liabilities (Tables)
Schedule of Other Liabilities


 

(in thousands)    SEPTEMBER 30,
2017
     DECEMBER 31,
2016
 

Capital lease obligations

   $ 37      $ 47  

Deferred rent liability

     476        150  
  

 

 

    

 

 

 
   $ 513      $ 197  
  

 

 

    

 

 

 

Stockholders' equity (Tables)

Stock option transactions and the number of stock options outstanding are summarized below:

 

     NUMBER OF
SHARES
     WEIGHTED
AVERAGE
EXERCISE PRICE
     WEIGHTED
AVERAGE
REMAINING
CONTRACTUAL
LIFE

(IN YEARS)
     AGGREGATE
INTRINSIC
VALUE

(IN
THOUSANDS)
 

Outstanding at December 31, 2016

     1,378,352      $ 9.38        7.81      $ 9,829  

Options granted

     796,790        16.92        

Options exercised

     (41,780      9.35        

Options forfeited

     (59,820      12.42        
  

 

 

    

 

 

    

 

 

    

 

 

 

Outstanding at September 30, 2017

     2,073,542      $ 12.19        7.99      $ 6,280  
  

 

 

    

 

 

    

 

 

    

 

 

 

Exercisable as of September 30, 2017

     837,318      $ 9.39        6.43      $ 4,021  
  

 

 

    

 

 

    

 

 

    

 

 

 

The fair value of stock options granted is estimated using the Black-Scholes option pricing model with the following weighted average assumptions:

 

     THREE MONTHS ENDED
SEPTEMBER 30,
    NINE MONTHS ENDED
SEPTEMBER 30,
 
     2017     2016     2017     2016  

Expected volatility

     91     87     91     81

Expected dividends

     0     0     0     0

Expected terms (years)

     6.00       6.00       6.00       6.00  

Risk free rate

     1.87     1.07     1.89     1.23

Weighted average grant-date fair value of stock options

   $ 11.13     $ 6.50     $ 12.69     $ 5.76  

Other income, net (Tables)
Schedule of Other Income Net


 

(in thousands)    THREE MONTHS ENDED
SEPTEMBER 30,
    NINE MONTHS ENDED
SEPTEMBER 30,
 
     2017     2016     2017     2016  

Change in fair value of derivative liability

   $ —       $ 8     $ —       $ 81  

Foreign exchange gain (losses)

     8       (1     (12     (21

Interest income

     236       142       720       391  

Miscellaneous expenses

     (7     (12     (36     (27
  

 

 

   

 

 

   

 

 

   

 

 

 
   $ 237     $ 137     $ 672     $ 424  
  

 

 

   

 

 

   

 

 

   

 

 

 

Financial instruments (Tables)

The Company’s short-term investments and long-term investments consisted of available-for-sale securities as follows:

 

(in thousands)    Amortized
cost
     Gross
unrealized
gains
     Gross
unrealized
losses
     Fair value  

September 30, 2017

           

Short-term investments:

           

U.S. treasury securities

   $ 72,693      $ —        $ (103    $ 72,590  
  

 

 

    

 

 

    

 

 

    

 

 

 

Contractual maturities:

           

Due within one year

   $ 72,693            $ 72,590  

December 31, 2016

           
     Amortized
cost
     Gross
unrealized
gains
     Gross
unrealized
losses
     Fair value  

Short-term investments:

           

U.S. treasury securities

   $ 70,819      $ —        $ (61    $ 70,758  
  

 

 

    

 

 

    

 

 

    

 

 

 

Long-term investments:

           

U.S. treasury securities

   $ 50,155      $ —        $ (109    $ 50,046  
  

 

 

    

 

 

    

 

 

    

 

 

 

Contractual maturities:

           

Due within one year

   $ 70,819            $ 70,758  

Due after one year through two years

     50,155              50,046  

The aggregate estimated fair value of the Company’s investments with unrealized losses are as follows:

 

(in thousands)    Period of continuous unrealized loss  
     12 months or less      Greater than 12 months  
     Fair value      Gross
unrealized
losses
     Fair value      Gross
unrealized
losses
 

September 30, 2017

           

U.S. treasury securities

   $ 61,527      $ (99    $ 11,063      $ (4

December 31, 2016

           

U.S. treasury securities

   $ 120,804      $ (170      N/A        N/A  

The following tables present the fair value of our financial instruments that are measured at fair value on a recurring basis:

 

(in thousands)    QUOTED
PRICES IN
ACTIVE
MARKETS
FOR
IDENTICAL
ASSETS

(LEVEL 1)
     OTHER
OBSERVABLE
INPUTS

(LEVEL 2)
     SIGNIFICANT
UN-OBSERVABLE
INPUTS

(LEVEL 3)
     TOTAL  

BALANCES – September 30, 2017

           

Short-term investments – U.S. treasury securities

   $ 72,590      $ —        $ —        $ 72,590  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 72,590      $ —        $ —        $ 72,590  
  

 

 

    

 

 

    

 

 

    

 

 

 

BALANCES – December 31, 2016

           

Short-term investments – U.S. treasury securities

   $ 70,758      $ —        $ —        $ 70,758  

Long-term investments – U.S. treasury securities

     50,046        —          —          50,046  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 120,804      $ —        $ —        $ 120,804  
  

 

 

    

 

 

    

 

 

    

 

 

 

Nature of operations - Additional Information (Detail)
9 Months Ended
Sep. 30, 2017
Entity Information [Line Items]
 
Date of incorporation
May 31, 2007 
Aquinox Pharmaceuticals (Canada) Inc. [Member]
 
Entity Information [Line Items]
 
Date of incorporation
Dec. 26, 2003 
Condensed summary of significant accounting policies - Additional Information (Detail) (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Segment
Dec. 31, 2016
Accounting Policies [Abstract]
 
 
Operating segment
 
Accumulated deficit
$ 182,234 
$ 148,278 
Cash and cash equivalents - Schedule of Cash and Cash Equivalents (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Sep. 30, 2016
Dec. 31, 2015
Cash and Cash Equivalents [Abstract]
 
 
 
 
Cash
$ 23,538 
$ 3,726 
 
 
Cash equivalents
23,567 
28,575 
 
 
Cash and cash equivalents
$ 47,105 
$ 32,301 
$ 86,225 
$ 39,526 
Other Liabilities - Schedule of Other Liabilities (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Other Liabilities [Abstract]
 
 
Capital lease obligations
$ 37 
$ 47 
Deferred rent liability
476 
150 
Other liabilities
$ 513 
$ 197 
Stockholders' equity - Additional Information (Detail) (USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Dec. 31, 2016
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Total number of shares authorized
55,000,000 
 
55,000,000 
 
 
Common stock, shares authorized
50,000,000 
 
50,000,000 
 
50,000,000 
Common stock, par value
$ 0.000001 
 
$ 0.000001 
 
$ 0.000001 
Preferred stock, shares authorized
5,000,000 
 
5,000,000 
 
 
Preferred stock, par value
$ 0.000001 
 
$ 0.000001 
 
 
Common stock, shares issued
23,464,930 
 
23,464,930 
 
23,423,150 
Common stock, shares outstanding
23,464,930 
 
23,464,930 
 
23,423,150 
Preferred stock, shares issued
 
 
Preferred stock, shares outstanding
 
 
Shares of common stock reserved for issuance description
 
 
Additionally, the number of shares of common stock reserved for issuance under the 2014 Plan will automatically increase on January 1 of each year for a period of up to 10 years, beginning on January 1, 2015 and ending on and including January 1, 2024, by 4% of the total number of shares of capital outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the board of directors. 
 
 
Shares of common stock reserved for issuance percentage
 
 
4.00% 
 
 
Years of increase in shares of common stock reserved for issuance
 
 
10 years 0 months 0 days 
 
 
Stock options granted
 
 
796,790 
 
 
Stock options granted, exercise price per share
 
 
$ 16.92 
 
 
Common stock issued upon exercise of options
218 
 
41,780 
 
 
Stock-based compensation expense
$ 1.2 
$ 0.5 
$ 2.9 
$ 1.4 
 
Unrecognized stock-based compensation cost
$ 11.6 
$ 4.4 
$ 11.6 
$ 4.4 
 
Unrecognized stock-based compensation cost, weighted-average period recognized
 
 
2 years 10 months 17 days 
2 years 10 months 21 days 
 
Employees [Member]
 
 
 
 
 
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Stock options granted
 
 
715,790 
 
 
Employees [Member] |
Minimum [Member]
 
 
 
 
 
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Stock options granted, exercise price per share
 
 
$ 13.74 
 
 
Employees [Member] |
Maximum [Member]
 
 
 
 
 
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Stock options granted, exercise price per share
 
 
$ 17.35 
 
 
Employees [Member] |
One Year after the Beginning of the Vesting Period [Member]
 
 
 
 
 
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Stock options, vesting percentage
 
 
25.00% 
 
 
Employees [Member] |
Condition (i) [Member]
 
 
 
 
 
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Stock options, vesting period
 
 
1 year 
 
 
Employees [Member] |
Condition (ii) [Member]
 
 
 
 
 
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Stock options, vesting period
 
 
3 years 
 
 
Non-Employee Directors [Member]
 
 
 
 
 
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Stock options granted
 
 
81,000 
 
 
Stock options granted, exercise price per share
 
 
$ 13.74 
 
 
Non-Employee Directors [Member] |
Condition (i) [Member]
 
 
 
 
 
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Stock options, vesting period
 
 
1 year 
 
 
Non-Employee Directors [Member] |
Condition (ii) [Member]
 
 
 
 
 
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Stock options, vesting period
 
 
3 years 
 
 
Equity Incentive Plan 2014 [Member]
 
 
 
 
 
Equity Transactions And Share Based Compensation [Line Items]
 
 
 
 
 
Maximum number of shares of common stock that may be issued
2,863,908 
 
2,863,908 
 
 
Stock options, expiration period
 
 
10 years 
 
 
Stockholders' equity - Schedule of Stock Option Transactions and Number of Stock Options Outstanding (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2017
Sep. 30, 2017
Dec. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
 
 
 
Options Outstanding, Number of Shares, beginning balance
 
1,378,352 
 
Options granted, Number of Shares
 
796,790 
 
Options exercised, Number of Shares
(218)
(41,780)
 
Options forfeited, Number of Shares
 
(59,820)
 
Options Outstanding, Number of Shares, ending balance
2,073,542 
2,073,542 
1,378,352 
Exercisable, Number of Shares, ending balance
837,318 
837,318 
 
Options Outstanding, Weighted Average Exercise Price, beginning balance
 
$ 9.38 
 
Options granted, Weighted Average Exercise Price
 
$ 16.92 
 
Options exercised, Weighted Average Exercise Price
 
$ 9.35 
 
Options forfeited, Weighted Average Exercise Price
 
$ 12.42 
 
Options Outstanding, Weighted Average Exercise Price, ending balance
$ 12.19 
$ 12.19 
$ 9.38 
Exercisable, Weighted Average Exercise Price, ending balance
$ 9.39 
$ 9.39 
 
Options Outstanding, Weighted Average Remaining Contractual Life (Years), ending balance
 
7 years 11 months 26 days 
7 years 9 months 22 days 
Exercisable, Weighted Average Remaining Contractual Life (Years), ending balance
 
6 years 5 months 5 days 
 
Options Outstanding, Aggregate Intrinsic Value
$ 6,280 
$ 6,280 
$ 9,829 
Exercisable, Aggregate Intrinsic Value
$ 4,021 
$ 4,021 
 
Stockholders' equity - Schedule of Weighted Average Assumptions (Detail)
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
 
 
 
 
Expected volatility
91.00% 
87.00% 
91.00% 
81.00% 
Expected dividends
0.00% 
0.00% 
0.00% 
0.00% 
Expected terms (years)
6 years 
6 years 
6 years 
6 years 
Risk free rate
1.87% 
1.07% 
1.89% 
1.23% 
Weighted average grant-date fair value of stock options
$ 11.13 
$ 6.50 
$ 12.69 
$ 5.76 
Other Income - Schedule of Other Income Net (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Other Income and Expenses [Abstract]
 
 
 
 
Change in fair value of derivative liability
 
$ 8 
 
$ 81 
Foreign exchange gain (losses)
(1)
(12)
(21)
Interest income
236 
142 
720 
391 
Miscellaneous expenses
(7)
(12)
(36)
(27)
Other income, net
$ 237 
$ 137 
$ 672 
$ 424 
Net loss per common stock - Additional Information (Detail)
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Earnings Per Share [Abstract]
 
 
 
 
Antidilutive securities excluded from the computation of basic and diluted net loss per share - outstanding stock options
2,073,542 
1,293,602 
2,073,542 
1,293,602 
Financial instruments - Summary of Short-Term Investments and Long-Term Investments of Available-for-Sale Securities (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
 
 
Due within one year, Amortized cost
$ 72,693 
$ 70,819 
Due within one year, Fair value
72,590 
70,758 
Due after one year through two years, Amortized cost
 
50,155 
Due after one year through two years, Fair value
 
50,046 
Short-term Investments [Member] |
U.S. Treasury Securities [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Amortized cost
72,693 
70,819 
Gross unrealized gains
Gross unrealized losses
(103)
(61)
Fair value
72,590 
70,758 
Long-term Investments [Member] |
U.S. Treasury Securities [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Amortized cost
 
50,155 
Gross unrealized gains
 
Gross unrealized losses
 
(109)
Fair value
 
$ 50,046 
Financial instruments - Aggregate Estimated Fair Value of Investments with Unrealized Losses (Detail) (U.S. Treasury Securities [Member], USD $)
In Thousands, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
U.S. Treasury Securities [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Period of continuous unrealized loss, 12 months or less, Fair value
$ 61,527 
$ 120,804 
Period of continuous unrealized loss, 12 months or less, Gross unrealized losses
(99)
(170)
Period of continuous unrealized loss, Greater than 12 months, Fair value
11,063 
 
Period of continuous unrealized loss, Greater than 12 months, Gross unrealized losses
$ (4)
 
Financial instruments - Fair Value of Financial Instruments Measured At Fair Value on a Recurring Basis (Detail) (USD $)
Sep. 30, 2017
Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Short-term investments
$ 72,590,000 
$ 70,758,000 
Long-term investments
 
50,046,000 
Fair Value of Financial instruments
72,590,000 
120,804,000 
U.S. Treasury Securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Short-term investments
72,590,000 
70,758,000 
Long-term investments
 
50,046,000 
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] |
Fair Value, Measurements, Recurring [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value of Financial instruments
72,590,000 
120,804,000 
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] |
Fair Value, Measurements, Recurring [Member] |
U.S. Treasury Securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Short-term investments
72,590,000 
70,758,000 
Long-term investments
 
$ 50,046,000 
Financial instruments - Additional Information (Detail) (USD $)
3 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
 
 
 
Fair Value of Financial instruments
$ 72,590,000 
 
$ 72,590,000 
 
$ 120,804,000 
Transfers between Levels 1, 2 and 3
 
 
Short term investments consisting of available for sale securities
72,590,000 
 
72,590,000 
 
70,758,000 
Net realized gains for securities
300,000 
200,000 
700,000 
400,000 
 
Other Observable Inputs (Level 2) [Member]
 
 
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
 
 
 
Fair Value of Financial instruments
 
 
Significant Unobservable Inputs (Level 3) [Member]
 
 
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
 
 
 
Fair Value of Financial instruments
$ 0 
 
$ 0 
 
$ 0