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Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2020	May 04, 2020
Document and Entity Information
Document Type	10-Q
Document Period End Date	Mar. 31, 2020
Entity Registrant Name	BICYCLE THERAPEUTICS PLC
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Interactive Data Current	Yes
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		18,087,657
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Entity Central Index Key	0001761612
Amendment Flag	false
Entity Ex Transition Period	true

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Current assets:
Cash	$ 109,637	$ 92,117
Accounts receivable	1,002	201
Prepaid expenses and other current assets	4,248	4,884
Research and development incentives receivable	8,503	6,944
Total current assets	123,390	104,146
Property and equipment, net	2,203	2,292
Operating lease right-of-use assets	1,815	2,056
Other assets	1,874	1,700
Total assets	129,282	110,194
Current liabilities:
Accounts payable	4,434	1,949
Accrued expenses and other current liabilities	5,716	6,144
Deferred revenue, current portion	6,047	728
Total current liabilities	16,197	8,821
Operating lease liabilities	1,056	1,251
Deferred revenue, net of current portion	28,206	4,929
Other long-term liabilities	2,010	1,995
Total liabilities	47,469	16,996
Commitments and contingencies (Note 12)
Shareholders’ equity:
Ordinary shares, £0.01 nominal value; 31,995,653 shares authorized at March 31, 2020 and December 31, 2019; 18,016,207 and 17,993,701 shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively	227	227
Additional paid‑in capital	197,179	195,056
Accumulated other comprehensive loss	(3,719)	(1,535)
Accumulated deficit	(111,874)	(100,550)
Total shareholders’ equity	81,813	93,198
Total liabilities and shareholders’ equity	$ 129,282	$ 110,194

Condensed Consolidated Balance Sheets (Parenthetical) - £ / shares	Mar. 31, 2020	Dec. 31, 2019
Ordinary shares, nominal value	£ 0.01	£ 0.01
Ordinary shares, shares authorized	31,995,653	31,995,653
Ordinary shares, shares issued	18,016,207	17,993,701
Ordinary shares, shares outstanding	18,016,207	17,993,701

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Condensed Consolidated Statements of Operations and Comprehensive Loss
Collaboration revenues	$ 1,129	$ 6,384
Operating expenses:
Research and development	7,774	6,276
General and administrative	4,998	3,402
Total operating expenses	12,772	9,678
Loss from operations	(11,643)	(3,294)
Other income (expense):
Interest and other income	212	64
Other expense, net		(3,193)
Total other income (expense), net	212	(3,129)
Net loss before income tax provision	(11,431)	(6,423)
(Benefit from) provision for income taxes	(107)	80
Net loss	(11,324)	(6,503)
Net loss attributable to ordinary shareholders	$ (11,324)	$ (6,503)
Net loss per share attributable to ordinary shareholders, basic and diluted	$ (0.63)	$ (7.80)
Weighted average ordinary shares outstanding, basic and diluted	17,997,929	834,043
Comprehensives Loss:
Net loss	$ (11,324)	$ (6,503)
Other comprehensive income (loss):
Foreign currency translation adjustment	(2,184)	1,080
Total comprehensive loss	$ (13,508)	$ (5,423)

Condensed Consolidated Statements of Convertible Preferred Shares and Shareholders’ Equity (Deficit) - USD ($) $ in Thousands	Series A Convertible Preferred Shares	Series B1 Convertible Preferred Shares	Series B2 Convertible Preferred Shares	Ordinary Shares	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Total
Beginning balance at Dec. 31, 2018	$ 41,820	$ 54,621	$ 25,756
Beginning balance (in shares) at Dec. 31, 2018	2,800,001	3,947,198	1,323,248
Increase (decrease) in convertible preferred shares
Issuance of convertible preferred shares			$ 1,583
Issuance of convertible preferred shares (in shares)			80,385
Ending balance at Mar. 31, 2019	$ 41,820	$ 54,621	$ 27,339
Ending balance (in shares) at Mar. 31, 2019	2,800,001	3,947,198	1,403,633
Beginning balance at Dec. 31, 2018				$ 10	$ 1,857	$ (1,751)	$ (69,942)	$ (69,826)
Beginning balance (in shares) at Dec. 31, 2018				814,728
Increase (decrease) in shareholders' equity (deficit)
Issuance of restricted share awards				$ 1	103			104
Issuance of restricted share awards (in shares)				27,304
Issuance of ordinary shares upon exercise of share options (in shares)				3
Share based compensation expense					172			172
Foreign currency translation adjustment						1,080		1,080
Net loss							(6,503)	(6,503)
Ending balance at Mar. 31, 2019				$ 11	2,132	(671)	(76,445)	(74,973)
Ending balance (in shares) at Mar. 31, 2019				842,035
Beginning balance at Dec. 31, 2019				$ 227	195,056	(1,535)	(100,550)	$ 93,198
Beginning balance (in shares) at Dec. 31, 2019				17,993,701				17,993,701
Increase (decrease) in shareholders' equity (deficit)
Issuance of ordinary shares upon exercise of share options					2			$ 2
Issuance of ordinary shares upon exercise of share options (in shares)				1,071
Issuance of ordinary shares upon exercise of warrants (in shares)				21,435
Share based compensation expense					2,121			2,121
Foreign currency translation adjustment						(2,184)		(2,184)
Net loss							(11,324)	(11,324)
Ending balance at Mar. 31, 2020				$ 227	$ 197,179	$ (3,719)	$ (111,874)	$ 81,813
Ending balance (in shares) at Mar. 31, 2020				18,016,207				18,016,207

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash flows from operating activities:
Net loss	$ (11,324)	$ (6,503)
Adjustments to reconcile net loss to net cash used in operating activities:
Share-based compensation expense	2,121	276
Depreciation and amortization	305	213
Change in fair value of warrant liability	0	3,197
Changes in operating assets and liabilities:
Accounts receivable	(846)	4,860
Research and development incentives receivable	(2,097)	(1,650)
Prepaid expenses and other current assets	347	(215)
Operating lease right-of-use assets	187	176
Other assets	(215)	125
Accounts payable	2,702	415
Accrued expenses and other current liabilities	(464)	(783)
Lease liabilities	191	(176)
Deferred revenue	30,103	(5,327)
Other long-term liabilities	152	191
Net cash provided by (used in) operating activities	21,162	(5,201)
Cash used in investing activities:
Purchases of property and equipment	(320)	(418)
Net cash used in investing activities	(320)	(418)
Cash flows from financing activities:
Payments of initial public offering costs		(1,300)
Proceeds from the exercise of share options and sale of ordinary shares	2
Net cash provided by financing activities	2	34
Effect of exchange rate changes on cash	(3,324)	1,569
Net increase (decrease) in cash	17,520	(4,016)
Cash at beginning of period	92,117	63,380
Cash at end of period	109,637	59,364
Supplemental disclosure of cash flow information
Cash paid for income taxes	11
Cash paid for amounts included in the measurement of operating lease liabilities		224
Purchases of property and equipment included in accounts payable and accrued expenses	$ 71
Deferred initial public offering costs accrued but not paid		431
Series B2 Convertible Preferred Shares
Cash flows from financing activities:
Proceeds from issuance of convertible preferred shares, net of issuance costs		$ 1,334

Nature of the business and basis of presentation	3 Months Ended
Nature of the business and basis of presentation	Mar. 31, 2020
Nature of business and basis of presentation
Nature of the business and basis of presentation	1. Nature of the business and basis of presentation Bicycle Therapeutics plc (collectively with its subsidiaries, the “Company”) is a clinical-stage biopharmaceutical company developing a novel class of medicines, which the Company refers to as Bicycles, for diseases that are underserved by existing therapeutics. Bicycles® are a unique therapeutic modality combining the pharmacology usually associated with a biologic with the manufacturing and pharmacokinetic properties of a small molecule. The Company’s initial internal programs are focused on oncology indications with high unmet medical need. The Company’s lead product candidate, BT1718, is a Bicycle Toxin Conjugate (“BTC”) that is being developed to target tumors that express Membrane Type 1 matrix metalloproteinase. BT1718 is being investigated for safety, tolerability and efficacy in an ongoing Phase I/IIa clinical trial in collaboration with, and fully funded by, the Centre for Drug Development of Cancer Research UK. The Company is also evaluating BT5528, a second-generation BTC targeting Ephrin type‑A receptor 2 (“EphA2”), in a Company-sponsored Phase I/II study as a monotherapy and in combination with nivolumab, and is conducting Investigational New Drug application (“IND”) ‑enabling activities for BT8009, a BTC targeting Nectin-4. The Company’s discovery pipeline in oncology includes Bicycle-based systemic immune cell agonists and Bicycle tumor-targeted immune cell agonists (TICAs™). Beyond oncology, the Company is collaborating with biopharmaceutical companies and organizations in therapeutic areas that include anti-bacterial, cardiovascular, ophthalmology, dementia and respiratory indications. The accompanying condensed consolidated financial statements include the accounts of Bicycle Therapeutics plc and its wholly owned subsidiaries, BicycleTx Limited, BicycleRD Limited and Bicycle Therapeutics Inc. All intercompany balances and transactions have been eliminated on consolidation. The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Liquidity On May 28, 2019, the Company completed its initial public offering (“IPO”), pursuant to which it issued and sold 4,333,333 American Depositary Shares (“ADSs”), representing the same number of ordinary shares at a public offering price of $14.00 per ADS. In addition, in June 2019, the Company issued and sold an additional 304,333 ADSs, pursuant to the partial exercise of the underwriters’ option to purchase additional ADSs. The aggregate net proceeds received by the Company from the IPO were $56.4 million, after deducting underwriting discounts and commissions of $4.5 million and offering expenses of $4.0 million. The Company is subject to risks common to companies in the biotechnology industry and in light of the ongoing COVID-19 pandemic, including but not limited to, risks of delays in initiating or continuing research programs and clinical trials, risks of failure of preclinical studies and clinical trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the need to successfully commercialize and gain market acceptance of its product candidates, dependence on key personnel and collaboration partners, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations, and the ability to secure additional capital to fund operations. Product candidates currently under development will require significant additional research and development efforts, including preclinical and clinical testing and regulatory approval prior to commercialization. Even if the Company's research and development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales. The accompanying condensed consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business. Since inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff, and raising capital. The Company has funded its operations with proceeds from sales of convertible preferred shares (Note 6) and proceeds received from its collaboration arrangements (Note 10), and most recently, with proceeds from the IPO completed in May 2019. The Company has incurred recurring losses since inception, including $11.3 million for the three months ended March 31, 2020. As of March 31, 2020, the Company had an accumulated deficit of $111.9 million. The Company expects to continue to generate operating losses in the foreseeable future. The Company expects that its cash will be sufficient to fund its operating expenses and capital expenditure requirements through at least twelve months from the issuance date of these interim condensed consolidated financial statements. The Company expects its expenses to increase substantially in connection with ongoing activities, particularly as the Company advances its preclinical activities and clinical trials for its product candidates in development. Accordingly, the Company will need to obtain substantial additional funding in connection with continuing operations. If the Company is unable to raise capital when needed, or on attractive terms, it could be forced to delay, reduce or eliminate its research or drug development programs or any future commercialization efforts. Although management continues to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company to fund continuing operations, if at all.

Summary of significant accounting policies	3 Months Ended
Summary of significant accounting policies	Mar. 31, 2020
Summary of significant accounting policies
Summary of significant accounting policies	2. Summary of significant accounting policies The Company’s significant accounting policies are disclosed in the audited consolidated financial statements for the year ended December 31, 2019 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, which was filed with the Securities and Exchange Commission (the “SEC”), on March 10, 2020 (the “2019 Annual Report”). Since the date of such consolidated financial statements, there have been no changes to the Company’s significant accounting policies, other than those disclosed below. Use of estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting periods. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the accrual for research and development expenses, revenue recognition, the fair value of ordinary shares and the valuation of the warrant liability prior to the Company’s IPO, share-based compensation expense, and income taxes. The Company bases its estimates on historical experience, known trends and other market‑specific or other relevant factors that it believes to be reasonable under the circumstances. Estimates are periodically reviewed in light of reasonable changes in circumstances, facts and experience and may be changed as new events occur and additional information is obtained. As of the date of issuance of these financial statements, the Company is not aware of any specific event or circumstance that would require the Company to update its estimates, assumptions and judgments or revise the carrying value of its assets or liabilities. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates or assumptions, and any such differences may be material to the Company’s financial statements. Significant Risks and Uncertainties With the global spread of the ongoing COVID-19 pandemic in the first quarter of 2020, the Company established a cross-functional task force and implemented business continuity plans designed to address and mitigate the impact of the COVID-19 pandemic on the Company’s business. While the Company is experiencing limited financial impacts at this time, the extent to which the COVID-19 pandemic impacts the Company’s business, clinical development and regulatory efforts, corporate development objectives and the value of and market for the Company’s ADSs, will depend on future developments that are highly uncertain and cannot be predicted with confidence at this time, such as the ultimate duration of the pandemic, travel restrictions, quarantines, social distancing and business closure requirements in the United Kingdom, United States, Europe and other countries, and the effectiveness of actions taken globally to contain and treat the disease. The global economic slowdown, the overall disruption of global healthcare systems and the other risks and uncertainties associated with the pandemic could have a material adverse effect on the Company’s business, financial condition, results of operations and growth prospects. In addition, the Company is subject to other challenges and risks specific to its business and ability to execute its strategy, as well as risks and uncertainties common to companies in the biotechnology industry, including but not limited to: risks of failure of preclinical studies and clinical trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the need to successfully commercialize and gain market acceptance of its product candidates, dependence on key personnel and collaboration partners, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations, and the ability to secure additional capital to fund operations. In addition, to the extent the ongoing COVID-19 pandemic adversely affects the Company’s business and results of operations, it may also have the effect of heightening many of the other risks and uncertainties discussed above. Unaudited Interim Financial Information Certain information in the footnote disclosures of the financial statements has been condensed or omitted pursuant to the rules and regulations of the SEC. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2019 included in the Company’s 2019 Annual Report. The accompanying condensed consolidated balance sheet at March 31, 2020, condensed consolidated statements of operations and comprehensive loss, condensed consolidated statements of convertible preferred shares and shareholders’ equity (deficit) and condensed consolidated statements of cash flows for the three months ended March 31, 2020 and 2019, and the related financial information disclosed in these notes are unaudited. The unaudited interim financial statements have been prepared on the same basis as the audited annual financial statements for the year ended December 31, 2019, and, in the opinion of management, reflect all adjustments, consisting of normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of March 31, 2020, the results of its operations for the three months ended March 31, 2020 and 2019, and its cash flows for the three months ended March 31, 2020 and 2019. The results for the three months ended March 31, 2020 are not necessarily indicative of the results to be expected for the year ending December 31, 2020, any other interim periods, or any future year or period. Foreign currency and currency translation The functional currency is the currency of the primary economic environment in which an entity’s operations are conducted. On June 1, 2019, Bicycle Therapeutics plc adopted the U.S. dollar (“USD”) as its functional currency. Bicycle Therapeutics plc is a holding company that has no operating activities and its primary functions are to serve as a financing vehicle to fund the operations of the Company’s operating entities, to serve as the listing company needed to access U.S. capital markets, and to hold investments. Therefore, its financing source is the primary indicator of its cash flows and its functional currency. The change in functional currency from the British Pound Sterling is due to a change in the source of Bicycle Therapeutics plc’s financing and cash flows, which following the completion of the IPO is now primarily the U.S. dollar. Historically its financing had been in British Pound Sterling. The functional currency of Bicycle Therapeutics plc’s wholly owned non-U.S. subsidiaries, BicycleTx Limited and BicycleRD Limited, is the British Pound Sterling and the functional currency of its U.S. subsidiary, Bicycle Therapeutics Inc. is the USD. The functional currency of the Company’s subsidiaries is the same as the local currency. Monetary assets and liabilities denominated in currencies other than the functional currency are remeasured into the functional currency at rates of exchange prevailing at the balance sheet dates. Non-monetary assets and liabilities denominated in foreign currencies are remeasured into the functional currency at the exchange rates prevailing at the date of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the determination of net loss for the respective periods. Adjustments that arise from exchange rate changes on transactions denominated in a currency other than the local currency are included in general and administrative expense in the condensed consolidated statements of operations and comprehensive loss as incurred. The Company recorded a foreign exchange gain of $1.3 million and an exchange loss of $0.3 million during the three months ended March 31, 2020 and 2019, respectively. The Company translates the assets and liabilities of BicycleTx Limited and BicycleRD Limited into USD at the exchange rate in effect on the balance sheet date. Revenues and expenses are translated at the average exchange rate in effect during the period. Unrealized translation gains and losses are recorded as a foreign currency translation adjustment, which is included in the condensed consolidated statements of convertible preferred shares and shareholders’ equity (deficit) as a component of accumulated other comprehensive income (loss). Recently issued accounting pronouncements In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 will change how companies account for credit losses for most financial assets and certain other instruments. For trade receivables, loans and held-to-maturity debt securities, companies will be required to recognize an allowance for credit losses rather than reducing the carrying value of the asset. ASU 2016-13 was effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. In November 2019, the FASB issued ASU No. 2019-10, Financial Instruments — Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates to amend the effective date of ASU 2016-13, for entities eligible to be smaller reporting companies as defined by the SEC, to be effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the potential impact that the adoption of ASU 2016-13 will have on the Company’s financial position and results of operations.

Fair value of financial assets and liabilities	3 Months Ended
Fair value of financial assets and liabilities	Mar. 31, 2020
Fair value of financial assets and liabilities
Fair value of financial assets and liabilities	3. Fair value of financial assets and liabilities Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: 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 that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. The carrying values of accounts receivable, research and development incentives receivable, other current assets, accounts payable and accrued expenses and other current liabilities approximate their fair values due to the short‑term nature of these assets and liabilities. As of March 31, 2020 and December 31, 2019, there were no assets or liabilities measured at fair value on a recurring basis. Cash and cash equivalents The Company considers all highly liquid investments with original maturities of three months or less at date of purchase to be cash equivalents. The Company had no cash equivalents at March 31, 2020 and December 31, 2019.

- Definition

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

+ References + Details

Property and equipment, net

3 Months Ended

Mar. 31, 2020

Property and equipment, net

Property and equipment, net

4. Property and equipment, net

Property and equipment, net consisted of the following (in thousands):


	March 31,		December 31,
	2020		2019
Laboratory equipment	$	4,256	$	4,326
Leasehold improvements		363		300
Computer equipment and software		222		229
Furniture and office equipment		184		120
		5,025		4,975
Less: Accumulated depreciation and amortization		(2,822)		(2,683)
	$	2,203	$	2,292

Depreciation expense was $0.3 million and $0.2 million for the three months ended March 31, 2020 and 2019, respectively.

Accrued expenses and other current liabilities

3 Months Ended

Mar. 31, 2020

Accrued expenses and other current liabilities

Accrued expenses and other current liabilities

5. Accrued expenses and other current liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):


	March 31,		December 31,
	2020		2019
Accrued employee compensation and benefits	$	1,081	$	2,514
Accrued external research and development expenses		3,142		2,055
Income taxes payable		7		1
Accrued professional fees		717		867
Current portion of operating lease liabilities		636		640
Other		133		67
	$	5,716	$	6,144

Convertible preferred shares	3 Months Ended
Convertible preferred shares	Mar. 31, 2020
Convertible preferred shares
Convertible preferred shares	6. Convertible preferred shares The Company had issued Series A convertible preferred shares (“Series A Preferred Shares”), Series B1 convertible preferred shares (“Series B1 Preferred Shares”), and Series B2 convertible preferred shares (“Series B2 Preferred Shares”) (collectively the “Preferred Shares”). On May 26, 2017, the Company completed the issue of 3,562,583 Series B1 Preferred Shares at a price per share of £11.2278, for gross cash proceeds of $51.9 million. In addition, on October 27, 2017, an additional unaffiliated investor subscribed for a further 384,615 Series B1 Preferred Shares at a price per share of £13.00, for gross cash proceeds of $6.6 million. These two transactions are collectively referred to as “the Series B1 Financing.” In conjunction with the Series B1 Financing, the Company also issued warrants to subscribe for 743,287 Series B1 Preferred Shares to the subscribers of the Series B1 Preferred Shares (Note 7). The Company allocated a portion of the proceeds equal to the fair value of the warrants at the date of grant to the warrant liability, and the remaining amount was allocated to the Series B1 Preferred Shares. On December 20, 2018, the Company completed the issue of 1,323,248 Series B2 preferred shares at a price per Series B2 preferred share of £15.55, for gross cash proceeds of $26.1 million (the “Series B2 Financing”). In conjunction with the Series B2 Financing, the existing holders of warrants to subscribe for Series B1 preferred shares surrendered 194,911 warrants to subscribe for the same number of Series B1 preferred shares and the Company issued a further 194,911 warrants to subscribe for the same number of Series B1 preferred shares to the new investor. In conjunction with the Series B2 Financing, the Company designated all previously outstanding Series B preferred shares as Series B1 preferred shares. On January 3, 2019, the Company completed the issue of 80,385 Series B2 preferred shares at a price per share of £15.55, for gross cash proceeds of $1.6 million. In May 2019, the Company’s board of directors and shareholders approved the reorganization of the Company’s share capital by issuing ordinary shares as bonus shares to each holder of ordinary shares on the basis of 1.429 bonus shares for each ordinary share in issue (having the effect of a one for 1.429 share split (without having an impact on the nominal value of the ordinary shares)), which was effected on May 13, 2019 (the “Share Capital Reorganization”). All issued and outstanding share and per share amounts of ordinary shares and share options included in the accompanying consolidated financial statements have been adjusted to reflect this share split for all periods presented. Upon the closing of the IPO in May 2019, all of the Company’s outstanding convertible preferred shares automatically converted into 11,647,529 ordinary shares on a 1:1.429 basis.

Warrant liability	3 Months Ended
Warrant liability	Mar. 31, 2020
Warrant liability
Warrant liability	7. Warrant liability On May 26, 2017, the Company issued 200,000 warrants to subscribe for Series A Preferred Shares at £0.01 each, which were exercisable at any time after May 26, 2017 provided that they had not otherwise lapsed in accordance with their terms. The warrants to subscribe for Series A Preferred Shares expired upon the earlier of (i) 10 years from their issuance date, or (ii) upon an IPO or exit unless an exercise delay notice was provided by the Series A warrant holder, in which case they expire 12 months following an IPO or exit. On May 28, 2019, in conjunction with the completion of the IPO, 120,000 warrants to subscribe for Series A Preferred Shares were exercised for 171,480 ordinary shares. The holders of the remaining 80,000 warrants, which were exercisable into 114,320 ordinary shares following the completion of the IPO, as adjusted for the impact of the Share Capital Reorganization (Note 6), provided the Company with an exercise delay notice. On May 26, 2017, in conjunction with the issuance of 3,562,583 Series B1 Preferred Shares at a price per share of £11.2278, the Company issued 627,903 warrants to subscribe for Series B1 Preferred Shares with an exercise price of £0.01. In addition, on October 27, 2017, in conjunction with the issuance of 384,615 Series B1 Preferred Shares the Company issued a further 115,384 warrants to subscribe for Series B1 Preferred Shares with an exercise price of £0.01. In conjunction with the Series B2 Financing, the existing holders of warrants to subscribe for Series B1 preferred shares surrendered 194,911 warrants to subscribe for the same number of Series B1 preferred shares and the Company issued a further 194,911 warrants to subscribe for the same number of Series B1 preferred shares to the new investor. The transfer of warrants between investors did not have an impact to the valuation of the warrant liability, as this represents a transaction between shareholders and the Company did not issue any new instruments or change the rights and preferences of the underlying warrants to subscribe for Series B1 preferred shares. On March 7, 2019, the holders of the Series B1 warrants to subscribe for Series B1 Preferred Shares agreed that 50% of the warrants would be exercised in conjunction with the IPO and 50% of the warrants would expire. The Company assessed this event as a modification to the terms of the Series B1 warrants and, remeasured the warrant liability immediately before and immediately after the modification, which resulted in an incremental change in fair value of $0.1 million, which is included in other expense for the three months ended March 31, 2019. On May 28, 2019, in conjunction with the completion of the IPO, all Series B1 Preferred share warrants were exercised for 531,077 ordinary shares, as adjusted for the impact of the Share Capital Reorganization (Note 6). Prior to the completion of the IPO, the warrants to subscribe for Series A and Series B1 Preferred Shares were recorded as a liability and remeasured to fair value at each reporting date. Changes in the fair value of the warrant liability were recognized as other expense, net in the condensed consolidated statements of operations and comprehensive loss. Upon the closing of the IPO on May 28, 2019, warrants that were not exercised in conjunction with the IPO automatically became warrants to subscribe for ordinary shares, and met the criteria to be classified as shareholders’ equity (deficit). As such, following the final remeasurement on May 28, 2019, the Company reclassified the carrying value of the warrant liability to additional paid-in-capital in the condensed consolidated balance sheet. The Company recorded other expense of zero and $3.2 million related to the remeasurement of the warrant liability during the three months ended March 31, 2020 and 2019, respectively.

Ordinary shares	3 Months Ended
Ordinary shares	Mar. 31, 2020
Ordinary shares
Ordinary shares	8. Ordinary shares Each holder of ordinary shares is entitled to one vote per ordinary share and to receive dividends when and if such dividends are recommended by the board of directors and declared by the shareholders. Holders of ADSs are not treated as holders of the Company’s ordinary shares, unless they withdraw the ordinary shares underlying their ADSs in accordance with the deposit agreement and applicable laws and regulations. The depositary is the holder of the ordinary shares underlying the ADSs. Holders of ADSs therefore do not have any rights as holders of the Company’s ordinary shares, other than the rights that they have pursuant to the deposit agreement with the depositary. As of March 31, 2020 and December 31, 2019, the Company has not declared any dividends. As of March 31, 2020 and December 31, 2019, the Company’s authorized capital share consisted of 31,995,653 ordinary shares with a nominal value of £0.01 per share.

Share-based compensation

3 Months Ended

Mar. 31, 2020

Share-based compensation

Share-based compensation

9. Share‑based compensation

Employee incentive pool

2019 Share Option Plan

In May 2019, the Company adopted the 2019 Share Option Plan (the “2019 Plan”), which became effective in conjunction with the IPO. In September 2019, the Compensation Committee of the Company’s Board of Directors approved immaterial clarifying amendments to the 2019 Plan which did not have an impact to the condensed consolidated financial statements. The 2019 Plan provides for the grant of options to purchase ordinary shares and other share-based awards to officers, employees, directors and other key persons (including consultants).

The Company initially reserved 2,470,583 ordinary shares for future issuance under the 2019 Plan. The number of ordinary shares reserved for issuance of the 2019 Plan will automatically increase on the first day of January, commencing on January 1, 2020, in an amount equal to 4% of the total number of ordinary shares outstanding on the last day of the preceding year, or a lesser number of shares determined by the Company’s board of directors, subject to adjustment in the event of a share split, share dividend or other change in capitalization. The number of shares reserved for issuance under the 2019 Plan was increased by 719,748 shares effective January 1, 2020. As of March 31, 2020, there were 567,433 shares available for issuance under the 2019 Plan.

Share options issued under the 2019 Share Option Plan have a 10 year contractual life, and generally either vest monthly over a three year service period, or over a four‑year service period with 25% of the award vesting on the first anniversary of the commencement date and the balance thereafter in 36 equal monthly installments. Certain awards granted to our directors are fully vested on the date of grant. The exercise price of share options issued under the 2019 Share Option Plan shall not be less than the fair value of ordinary shares as of the date of grant.

Pre-IPO Share Options and restricted shares

Prior to the IPO, the Company issued share options and ordinary shares, as administered by the board of directors, using standardized share option and share subscription agreements. To the extent such incentives were in the form of share options, the options may have been granted pursuant to a potentially tax-favored Enterprise Management Incentive (“EMI”) scheme available to U.K. employees, directors and consultants of the Company. Upon completion of the IPO, shares reserved for future issuance outside of the 2019 Share Option Plan were cancelled.

Options granted, as well as restricted shares granted as employee incentives prior to the IPO, typically vest over a four‑year service period with 25% of the award vesting on the first anniversary of the commencement date and the balance thereafter in 36 equal monthly installments and expire no later than 10 years from the date of grant.

Certain equity awards were issued in 2017 and 2018 for which 20% of the award vests upon the first anniversary of the vesting start date, 60% vests thereafter in 36 equal monthly installments, and 20% vest upon the earlier of the fourth anniversary of the vesting start date, or the achievement of a specified revenue threshold from the Company’s collaboration arrangements.

Options issued to U.K. employees prior to the IPO generally had an exercise price of £0.01 per share. The exercise price for share options granted to U.S. employees, had an exercise price that was not less than the fair value of ordinary shares as determined by the board of directors as of the date of grant. Prior to the IPO, the Company’s board of directors valued the Company’s ordinary shares based on input from management, considering the most recently available valuation of ordinary share performed by an independent third‑party valuation firm as well as additional factors which may have changed since the date of the most recent contemporaneous valuation through the date of grant.

Employee Share Purchase Plan (“ESPP”)

In May 2019, the Company adopted the 2019 Employee Stock Purchase Plan (the “ESPP”), which became effective in conjunction with the IPO. The Company initially reserved 215,000 ordinary shares for future issuance under this plan. The ESPP provides that the number of shares reserved and available for issuance will automatically increase each January 1, beginning on January 1, 2020 and each January 1 thereafter through January 1, 2029, by the least of (i) 1% of the outstanding number of ordinary shares on the immediately preceding December 31; (ii) 430,000 ordinary shares or (iii) such lesser number of shares as determined by the Compensation Committee. The number of shares reserved under the ESPP is subject to adjustment in the event of a split-up, share dividend or other change in our capitalization. On January 1, 2020, the total number of shares available for issuance under the ESPP was increased by 179,937 ordinary shares pursuant to this provision.

Each offering to the employees to purchase shares under the ESPP will begin on each June 1 and December 1 and will end on the following November 30 and May 31, respectively. On each purchase date, which falls on the last date of each offering period, ESPP participants will purchase ordinary shares at a price per share equal to 85% of the lesser of (1) the fair market value of the shares on the offering date or (2) the fair market value of the shares on the purchase date. The occurrence and duration of offering periods under the ESPP are subject to the determinations of the Company’s compensation committee. As of March 31, 2020, there have been no offering periods to employees under ESPP.

Share‑based compensation

The Company recorded share‑based compensation expense in the following expense categories of its condensed consolidated statements of operations and comprehensive loss (in thousands):


	Three Months Ended
	March 31,
	2020		2019
Research and development expenses	$	675	$	108
General and administrative expenses		1,446		168
	$	2,121	$	276

Share options

The following table summarizes the Company’s option activity since December 31, 2019:


				Weighted
		Weighted		Average	Aggregate
	Number of	Average		Contractual	Intrinsic
	Shares	Exercise Price		Term	Value
				(in years)	(in thousands)
Outstanding as of December 31, 2019	2,634,346	$	9.57	9.04	$	2,868
Granted	1,030,361		10.17	—		—
Exercised	(1,071)		1.47	—		—
Forfeited	(8,748)		8.67	—		—
Outstanding as of March 31, 2020	3,654,888	$	9.74	9.17	$	14,973
Vested and expected to vest as of March 31, 2020	3,654,888	$	9.74	9.17	$	14,973
Options exercisable as of March 31, 2020	984,491	$	7.71	8.79	$	5,993

The weighted average grant‑date fair value of share options granted during the three months ended March 31, 2020 and 2019 was $6.68 per share and $3.68 per share, respectively.

Total share-based compensation expense for share options granted was $2.1 million for the three months ended March 31, 2020, and $0.2 million for the three months ended March 31, 2019. Expense for non-employee consultants for the three months ended March 31, 2020 and 2019 was immaterial.

The aggregate intrinsic value of share options is calculated as the difference between the exercise price of the share options and the fair value of the Company’s ordinary shares. The aggregate intrinsic value of share options exercised was immaterial during each of the three months ended March 31, 2020 and 2019.

The following table presents, on a weighted average basis, the assumptions used in the Black‑Scholes option‑pricing model to determine the fair value of share options granted to employees and directors:


	Three
	Months
	Ended
	March 31,
	2020		2019
Risk-free interest rate	1.6	%	2.7	%
Expected volatility	73.7	%	79.6	%
Expected dividend yield	—		—
Expected term (in years)	5.95		6.07

As of March 31, 2020, total unrecognized compensation expense related to the unvested employee and director share‑based awards was $15.3 million, which is expected to be recognized over a weighted average period of 2.9 years.

Restricted shares

The Company had granted restricted shares with service‑based vesting conditions. In conjunction with the IPO in May 2019, the board of directors modified the vesting terms to accelerate vesting for all then unvested restricted shares. As of March 31, 2020 and December 31, 2019 there are no unvested restricted ordinary shares. Total share-based compensation for unvested restricted shares granted was zero for the three months ended March 31, 2020, and $0.1 million for the three months ended March 31, 2019.

The fair value of employee restricted share awards vested, based on estimated fair values of the ordinary shares underlying the restricted share awards on the day of vesting, was zero during the three ended March 31, 2020, and $0.1 million during the three months ended March 31, 2019.

As of March 31, 2020, there was no unrecognized compensation cost related to the unvested employee and director restricted share awards.

Significant Agreements

3 Months Ended

Mar. 31, 2020

Significant Agreements

Significant Agreements

10. Significant agreements

For the three months ended March 31, 2020 and 2019, the Company had collaboration agreements with Genentech Inc. (“Genentech”), AstraZeneca AB (“AstraZeneca”), Sanofi (formerly Bioverativ), Oxurion (formerly ThromboGenics), and the Dementia Discovery Fund (“DDF”). The following table summarizes the revenue recognized in the Company’s condensed consolidated statements of operations and comprehensive loss from the Company’s collaboration agreements (in thousands):


	Three Months
	Ended
	March 31,
	2020		2019
Collaboration revenues
AstraZeneca	$	412	$	425
Sanofi		—		5,959
Dementia Discovery Fund		56		—
Genentech		661		—
Total collaboration revenues	$	1,129	$	6,384

AstraZeneca Collaboration Agreement

Summary of Agreement — 2016 Agreement

In November 2016, the Company entered into a Research Collaboration Agreement (the “AstraZeneca Collaboration Agreement”) with AstraZeneca. The collaboration is focused on the research and development of Bicycle peptides that bind to up to six biological targets. After discovery and initial optimization of such Bicycle peptides, AstraZeneca will be responsible for all research and development, including lead optimization and drug candidate selection. AstraZeneca has option rights, at drug candidate selection, which allow it to obtain development and exploitation license rights with regard to such drug candidate. The initial research obligation focuses on two targets within respiratory, cardiovascular and metabolic disease. AstraZeneca also has an option to nominate up to four additional targets at any point up to the second anniversary of the agreement (“Additional Four Target Option”). The exercise of this option right results in an option fee payable to the Company of $5.0 million and the research obligations and rights are consistent with the obligations and rights related to the initial two targets discussed below.

Under the AstraZeneca Collaboration Agreement, the Company is obligated to use commercially reasonable efforts to perform research activities on the initial two targets, under mutually agreed upon research plans. The research plans include two discrete parts, on a research program by research program basis: (i) the Bicycle Research Term, which is focused on the generation of Bicycle peptide libraries using the Company’s peptide drug discovery platform, to be screened against selected biological targets and optimization of promising compounds, with the goal of identifying compounds that meet the criteria set by the parties, and (ii) the AZ Research Term, during which AstraZeneca may select certain compounds and continue research activities on those compounds, at its sole expense, with the goal of identifying compounds that satisfy the relevant pharmacological and pharmaceutical criteria for clinical testing. AstraZeneca may, at its sole discretion, approve any compound to be progressed into drug development and, upon the selection of each drug candidate, AstraZeneca is to pay $8.0 million as an option fee, in order to obtain worldwide development and exploitation rights.

Each research program is to continue for an initial period of three years (the “Research Term”), including one year for the Bicycle Research Term and two for the AZ Research Term. AstraZeneca may extend the Research Term for each research program by twelve months (or fifteen months, if needed to complete certain toxicology studies). The Research Term for a specific program can be shorter if it is ceased due to a screening failure, a futility determination, abandonment by AstraZeneca, or upon selection of a drug candidate. AstraZeneca has certain substitution rights should a screening failure or futility determination be reached but is obligated to fund these additional efforts related to substitution.

Under the terms of the AstraZeneca Collaboration Agreement, the Company granted to AstraZeneca, for each research program, a right and license (with the right to sublicense) to certain background and platform intellectual property, for the duration of the applicable Research Term, to the extent necessary or useful for AstraZeneca to conduct the activities assigned to it in the applicable research plan, but for no other purpose.

The activities under the AstraZeneca Collaboration Agreement are governed by a joint steering committee (“JSC”) formed by an equal number of representatives from the Company and AstraZeneca. The JSC oversees and reviews each research program. Among other responsibilities, the JSC monitors and reports on research progress and it is responsible to ensure open and frequent exchange between the parties regarding research program activities.

AstraZeneca is obligated to fund two full time equivalents (“FTE”) during the Bicycle Research Term, for each research program, based on an agreed upon FTE reimbursement rate. Payment is made quarterly in advance of services being provided.

AstraZeneca has the option to obtain development and commercialization licenses associated with each designated drug candidate in return for a fee of $8.0 million per drug candidate. In addition, AstraZeneca is required to make certain milestone payments to the Company upon the achievement of specified development, regulatory and commercial milestones. More specifically, for each research program, the Company is eligible to receive up to $29.0 million in development milestone payments and up to $23.0 million in regulatory milestone payments. The Company is also eligible for up to $110.0 million in commercial milestone payments, on a research program by research program basis. Development milestone payments are triggered upon initiation of a defined phase of clinical research for a drug candidate. Regulatory milestone payments are triggered upon approval to market a product candidate by the United States Food and Drug Administration (“FDA”) or other global regulatory authorities. Commercial milestone payments are triggered when an approved pharmaceutical product reaches certain defined levels of net sales by the licensee. In addition, to the extent any of the product candidates covered by the licenses conveyed to AstraZeneca are commercialized, the Company would be entitled to receive tiered royalty payments of mid‑single digits based on a percentage of net sales. Royalty payments are subject to certain reductions, including in certain countries where AstraZeneca faces generic competition. Due to the uncertainty of pharmaceutical development and the high historical failure rates generally associated with drug development, the Company may not receive any additional milestone payments or royalty payments from AstraZeneca.

Either party may terminate the AstraZeneca Collaboration Agreement if the other party has materially breached or defaulted in the performance of any of its material obligations and such breach or default continues after the specified cure period. Either party may terminate the AstraZeneca Collaboration Agreement in the event of the commencement of any proceeding in or for bankruptcy, insolvency, dissolution or winding up by or against the other party that is not dismissed or otherwise disposed of within a specified time period. AstraZeneca may terminate the AstraZeneca Collaboration Agreement, entirely or on a licensed product by licensed product or country by country basis, for convenience.

Accounting Analysis

The Company has identified the following performance obligations:

(i)

research license and the related research and development services during the Bicycle Research Term for the first target (the “Target One Research License and Related Services”),

(ii)

research license and the related research and development services during the Bicycle Research Term for the second target (the “Target Two Research License and Related Services”).

The Company concluded that the Additional Four Target Option is not a material right, as the option does not provide a discount that AstraZeneca otherwise would not have received. The Company’s participation in the joint steering committee was assessed as immaterial in the context of the contract. The Company has concluded that the research license is not distinct from the research and development services during the Bicycle Research Term as AstraZeneca cannot obtain the benefit of the research license without the Company performing the research and development services. The services incorporate proprietary technology and unique skills and specialized expertise, particularly as it relates to constrained peptide technology that is not available in the marketplace. As a result, for each research program, the research license has been combined with the research and development services into a single performance obligation.

The total transaction price was initially determined to be $1.2 million, consisting solely of research and development funding. The Company utilizes the most likely amount method to determine the amount of research and development funding to be received. Additional consideration to be paid to the Company upon the exercise of the license options by AstraZeneca or upon reaching certain milestones is excluded from the transaction price as they relate to option fees and milestones that can only be achieved subsequent to the option exercise or are outside of the initial contact term.

The Company will recognize revenue related to amounts allocated to the Research License and Related Services as the underlying services are performed over the one year Research Term using a proportional performance model over the period of service using input‑based measurements of total full‑time equivalent effort incurred to date as a percentage of total full‑time equivalent time expected and will remeasure its progress towards completion at the end of each reporting period, which best reflects the progress towards satisfaction of the performance obligation.

In October 2017, AstraZeneca selected a replacement target for the first target, and as such a new Research Term was started related to the Target One Research License and Related Services. In addition, both programs were extended. The total transaction price under the arrangement increased to $2.0 million for the additional research and development funding received.

For the three months ended March 31, 2020 and 2019, the Company recognized zero and $0.1 million, respectively, of collaboration revenue related to the Target One and Target Two Research License and Related Services for its Collaboration Agreement with AstraZeneca. As of March 31, 2020, and December 31, 2019, the Company recorded zero deferred revenue in connection with the 2016 AstraZeneca Collaboration Agreement.

May 2018 AstraZeneca Option Exercise — Additional Four Targets

Under the AstraZeneca Collaboration Agreement, AstraZeneca was granted an option to nominate up to four additional targets at any point up to the second anniversary of the agreement (“Additional Four Target Option”). In May 2018, AstraZeneca made an irrevocable election to exercise the Additional Four Target Option. As a result, AstraZeneca is entitled to obtain research and development services with respect to Bicycle peptides that bind to up to four additional targets, along with license rights to those selected targets, in exchange for an option fee of $5.0 million, which was paid by AstraZeneca to the Company in January 2019. AstraZeneca is obligated to fund two FTEs during the Bicycle Research Term, for each research program, based on an agreed upon FTE reimbursement rate. Payment is made quarterly in advance of services being provided. AstraZeneca has the option to obtain worldwide development and commercialization licenses associated with each designated drug candidate in return for a fee of $8.0 million per drug candidate, upon the selection of such drug candidate, after which AstraZeneca would be required to fund development and commercialization costs, and to pay regulatory and commercial milestone payments and royalties to the Company as for the other products developed under the AstraZeneca Collaboration Agreement.

Accounting Analysis

Upon the execution of the agreement, the Company has identified the following five performance obligations associated with the AstraZeneca May 2018 Agreement:

(i)

Research license and the related research and development services during the Bicycle Research Term for the third target (the “Target Three Research License and Related Services”),

(ii)

Material right associated with the development and exploitation license option for the third target (“Target Three Material Right”),

(iii)

Material right associated with the research services option, including the underlying development and exploitation license option for the fourth target (“Target Four Material Right”),

(iv)

Material right associated with the research services option, including the underlying development and exploitation license option for the fifth target (“Target Five Material Right”), and

(v)

Material right associated with the research services option, including the underlying development and exploitation license option for the sixth target (“Target Six Material Right”).

The Company concluded that the fourth, fifth and sixth targets available for selection are options. Upon exercise, AstraZeneca will obtain a research license and the related research and development services and an option to a development and exploitation license. The Company has concluded that each research services option, including the underlying development and exploitation license options related to each respective target, results in a material right as the option exercise fee related to the development and exploitation license contains a discount that AstraZeneca would not have otherwise received.

The research license and the related research and development services related to the fourth, fifth and sixth targets are not performance obligations at the inception of the arrangement, as they are optional services that will be performed if AstraZeneca selects additional targets and they reflect their standalone selling prices and do not provide the customer with material rights. The Company’s participation in the joint steering committee was assessed as immaterial in the context of the contract.

The total transaction price was determined to be $5.7 million at the inception of the arrangement, consisting of the $5.0 million option exercise fee and research and development funding of an estimated $0.7 million. The research and development funding is being provided based on the costs that are incurred to conduct the research and development services. The Company utilizes the most likely amount method to determine the amount of research and development funding to be received. Additional consideration to be paid to the Company upon the exercise of the license options by AstraZeneca or upon reaching certain milestones are excluded from the transaction price as they relate to option fees and milestones that can only be achieved subsequent to the license option exercise or are outside of the initial contact term.

The transaction price was allocated to the performance obligations based on the relative estimated standalone selling prices of each performance obligation. The estimated standalone selling prices for each Research License and Related Services obligation is primarily based on the nature of the services to be performed and estimates of the associated effort and costs of the services, adjusted for a reasonable profit margin what would be expected to be realized under similar contracts. The estimated standalone selling price for the material rights was determined based on the fees AstraZeneca would pay to exercise the license options, the estimated value of the License Option using comparable transactions, and the probability that (i) AstraZeneca would opt into the target development, and (ii) the license options would be exercised by AstraZeneca. Based on the relative standalone selling price, the allocation of the transaction price to the separate performance obligations at the inception of the arrangement is as follows (in thousands):


	Allocation of
Performance Obligations	Transaction Price
Target Three Research License and Related Services	$	650
Target 3 Material Right		1,504
Target 4 Material Right		1,204
Target 5 Material Right		1,165
Target 6 Material Right		1,127
	$	5,650

The Company will recognize revenue related to amounts allocated to the Target Three Research License and Related Services as the underlying services are performed using a proportional performance model over the period of service using input‑based measurements of total full‑time equivalent effort incurred to date as a percentage of total full‑time equivalent time expected, which best reflects the progress towards satisfaction of the performance obligation. The amount allocated to the material rights is recorded as deferred revenue and the Company will commence revenue recognition upon exercise of or upon expiry of the option. The optional future research license and the related research and development services related to the fourth, fifth and sixth targets reflect their standalone selling prices and do not provide the customer with a material right and, therefore, are not considered performance obligations and are accounted for as separate contracts. In June 2019, AstraZeneca selected a replacement target for the third target, and as such a new Research Term was started related to the Target Three Research License and Related Services. The total transaction price under the arrangement increased to $6.3 million for the additional research and development funding to be received. During the year ended December 31, 2019, the Company commenced research and development services related to the fourth and fifth targets.

For the three months ended March 31, 2020 and 2019, the Company recognized $0.4 million and $0.3 million of revenue, respectively for the Target Three Research License and Related Service, and research and development services for the fourth target and fifth targets related to the May 2018 AstraZeneca Option Exercise. As of March 31, 2020, and as of December 31, 2019, the Company recorded $4.7 million and $4.9 million of deferred revenue, respectively, in connection with the May 2018 AstraZeneca Option Exercise and related contracts.

Sanofi Collaboration Agreement (formerly Bioverativ)

Summary of Agreement

In August 2017, the Company entered into a Collaboration Agreement with Bioverativ Inc., which was acquired by Sanofi in March 2018 (“Sanofi”). Under the collaboration agreement with Sanofi (the “Sanofi Collaboration Agreement”), the Company provided research and development services focused on up to three collaboration programs; (i) Sickle cell disease, (ii) Hemophilia, and (iii) and a third program (“Program 3”), which was an optional program, to be defined. The option expired in November 2018 unexercised. The Company used its bicyclic peptide screening platform to perform research and development services for the programs and Sanofi had the ability to select a collaboration product for each program and obtain a license to develop and exploit the selected collaboration product for an additional option fee.

Under the terms of the Sanofi Collaboration Agreement, the Company granted to Sanofi, for each collaboration program, a non‑exclusive, sublicensable (through multiple tiers), worldwide license under certain intellectual property of the Company to conduct the activities assigned to Sanofi in the applicable research plan for the duration of the applicable Research Term, but for no other purpose. The activities under the Sanofi Collaboration Agreement were governed by a joint steering committee (“Sanofi JSC”) formed by an equal number of representatives from the Company and Sanofi. The Sanofi JSC oversaw, review and recommends direction of each collaboration program and variations of or modifications to the research plans.

Sanofi could terminate the Sanofi Collaboration Agreement, entirely or on a program by program, licensed product by licensed product or country by country basis, for convenience upon not less than 30 days prior written notice to the Company.

Accounting Analysis

The Company identified the following four performance obligations associated with the Sanofi Collaboration Agreement:

(i)

Research License and the related research and development services during the BV Bicycle Research Term for Sickle cell program (the “Sickle Cell Research License and Related Services”),

(ii)

Research License and the related research and development services during the BV Bicycle Research Term for Hemophilia program (the “Hemophilia Research License and Related Services”),

(iii)

Material right associated with the sickle cell program development and exploitation license option (“Sickle Cell License Option Material Right”), and

(iv)

Material right associated with the hemophilia program development and exploitation license option (“Hemophilia License Option Material Right”).

The Company concluded that the option to obtain screening services on the additional Program 3 target was not a material right, as the option did not provide a discount that Sanofi otherwise would not have received. The Company’s participation in the Sanofi JSC was assessed as immaterial in the context of the contract. Research license and the related research and development services related to the Joint Research Term were not performance obligations at the inception of the arrangement, as they were optional services that will be performed if Sanofi selects collaboration compounds for lead optimization. The amount paid by Sanofi for the services during the Joint Research Team did not reflect a discount that the customer would otherwise receive and do not provide the customer with material rights.

The total transaction price was initially determined to be $14.2 million, consisting of the $10.0 million upfront payment and non‑refundable research and development funding of $4.2 million. The Company could receive reimbursement of FTE costs and external costs associated with work under the Joint Research Term, milestone payments during the Joint Research Term, as well as upon exercise of the license options. These variable amounts were excluded from the transaction price as they relate to fees and milestones that can only be achieved subsequent to the exercise of an option.

The transaction price was allocated to the performance obligations based on the relative estimated standalone selling prices of each performance obligation. The estimated standalone selling prices for the Research License and Related Services is primarily based on the nature of the services to be performed and estimates of the associated effort and costs of the services, adjusted for a reasonable profit margin what would be expected to be realized under similar contracts. The estimated standalone selling price for the material rights was determined based on the fees Sanofi would pay to exercise the license options, the estimated value of the license option using comparable transactions, and the probability that the license options would be exercised by Sanofi. Based on the relative standalone selling price, the allocation of the transaction price to the separate performance obligations at the inception of the arrangement is as follows (in thousands):


	Allocation of
Performance Obligations	Transaction Price
Sickle Cell Research License and Related Services	$	1,405
Hemophilia Research License and Related Services		2,811
Sickle Cell License Option Material Right		5,286
Hemophilia License Option Material Right		4,698
	$	14,200

The Company recognized revenue related to amounts allocated to the Sickle Cell Research License and Related Services and the Hemophilia Research License and Related Services obligations as the underlying services were performed using a proportional performance model, over the period of service using input‑based measurements of total full‑time equivalent effort incurred to date as a percentage of total full‑time equivalent time expected, which best reflected the progress towards satisfaction of the performance obligation. The amount allocated to the material rights was recorded as deferred revenue and the Company commended revenue recognition when the underlying option was exercised or upon expiry of the option.

During the year ended December 31, 2019, Sanofi extended the research and development services on both programs. The arrangement consideration increased to $14.9 million. On March 28, 2019, Sanofi notified the Company that it would not exercise the Sickle Cell License Option. As a result, the amount allocated to the Sickle Cell License Option Material Right of $5.3 million was recognized into revenue during the three months ended March 31, 2019. The collaboration with Sanofi was terminated effective October 23, 2019, and as a result, deferred revenue related to amounts allocated to the Hemophilia License Option Material Right were recognized in the fourth quarter of 2019.

The Company recognized zero and $6.0 million of collaboration revenue for the three months ended March 31, 2020 and 2019, respectively, related to its collaboration with Sanofi. As of March 31, 2020 and December 31, 2019 the Company recorded zero deferred revenue related to its collaboration with Sanofi.

Oxurion Collaboration Agreement

Summary of Agreement

In August 2013, the Company entered into a Research Collaboration and License Agreement with Oxurion (the “Oxurion Collaboration Agreement”). Under the Oxurion Collaboration Agreement, the Company was responsible for identifying Bicycle peptides related to the collaboration target, plasma kallikrein, for use in various ophthalmic indications. Oxurion is responsible for further development and product commercialization after the defined research screening is performed by the Company.

Under the Oxurion Collaboration Agreement, the Company is obligated to perform specified research activities in accordance with the research plan, which includes two stages. Stage I, now completed, focused on the screening of targets using the Company’s Bicycle peptide discovery platform with the goal of identifying compounds that meet the criteria set by the parties, and Stage II, during which Oxurion has continued research activities on selected Bicycle peptides with the goal of identifying compounds for further development and commercialization. The Company is not obligated or expected to perform any research services during Stage II of the research plan.

The Company granted certain worldwide intellectual property rights to Oxurion for the development, manufacture and commercialization of licensed compounds associated with plasma kallikrein. The Oxurion Collaboration Agreement provided for an upfront payment of €1.0 million and potential additional research and development funding, at an agreed upon FTE rate, should the research effort require more than one FTE or the research plan be amended or extended by Oxurion. In addition, Oxurion is required to make certain milestone payments to the Company upon the achievement of specified research, development, regulatory and commercial events. More specifically, for each collaboration program, the Company is eligible to receive up to €8.3 million in research and development milestones of which €1.8 million has been received as of March 31, 2020. In addition, the Company is eligible to receive up to €16.5 million upon achievement of certain regulatory milestone payments (e.g. €5 million for granting first regulatory approval in either the United States or EU for the first indication). In addition, to the extent any of the collaboration products covered by the licenses granted to Oxurion are commercialized, the Company would be entitled to receive tiered royalty payments of mid‑single digits based on a percentage of net sales.

Either party may terminate the Oxurion Collaboration Agreement if the other party has materially breached any of its material obligations and such breach continues after the specified cure period. Either party may terminate the Oxurion Collaboration Agreement in the event of the commencement of any proceeding in or for bankruptcy, insolvency, dissolution or winding up by or against the other party that is not dismissed or otherwise disposed of within a specified time period. Oxurion may terminate the Oxurion Collaboration Agreement, entirely or on a program by program, licensed product by licensed product or country by country basis, for convenience upon not less than 90 days prior written notice to the Company.

In November 2017, the parties executed the First Deed of Amendment to the Oxurion Collaboration Agreement (“First Amendment”). The First Amendment confirms that THR‑149 has been selected as a development compound under the Oxurion Collaboration Agreement and that Stage II of the research plan has been completed. The First Amendment provided for additional research services to be performed by the Company related to the identification of two additional compounds for Oxurion, in its discretion, to select as development compounds. As for the work under the Oxurion Collaboration Agreement, the Company will perform the work under Stage I of the research plan, which will be funded at a specified FTE rate, plus any direct out of pocket expenses, and Oxurion will be responsible for Stage II research and any development after the selection of a development compound. Additional milestones and royalties were added for the potential additional licensed compounds, consistent with those of the initial Oxurion Collaboration Agreement. The Company is not obligated or expected to perform any research services during Stage II of the research plan.

Accounting Analysis

Under the Oxurion Collaboration Agreement, all licenses were granted and research services to be provided by the Company were fully completed and revenue associated with those obligations was fully recognized prior to January 1, 2016. Under the First Amendment, the Company has identified a single performance obligation associated with the performance of research services associated with Stage I of the research plan for which the Company was reimbursed for its services at a specified FTE reimbursement rate plus out of pocket costs which were recognized on a proportional performance basis as the associated FTE efforts and costs were incurred, which best reflected the progress towards satisfaction of the performance obligation. None of the unpaid development or regulatory milestones have been included in the transaction price, as all milestones are not considered probable at March 31, 2020 and December 31, 2019.

The research services under the First Amendment were completed in 2018. The Company recognized zero revenue during the three months ended March 31, 2020, and 2019, related to its agreements with Oxurion, and zero deferred revenue as of March 31, 2020 and December 31, 2019.

Dementia Discovery Fund Agreement

In May 2019, the Company entered into a collaboration with the DDF to use Bicycle technology for the discovery and development of novel therapeutics for dementia (the “DDF Collaboration Agreement”). Under the terms of the DDF Collaboration Agreement, the Company and DDF will collaborate to identify Bicycles that bind to clinically validated dementia targets (the “DDF Research Plan”). The Company is obligated to use commercially reasonable efforts to perform research activities under the DDF Research Plan. DDF shall not be directly engaged in the conduct of any research activities under the arrangement. The activities under the DDF Collaboration Agreement will be governed by a project advisory panel, composed of two representatives from each Party. The Research Advisory Panel will oversee, review and recommend direction for the Research Plans and variations of or modifications of research plans.

The Company received an upfront payment of $1.1 million in May 2019. The Company may receive up to an additional $0.7 million, upon achievement of certain milestones such as the identification of lead bicycle candidates with a certain affinity, which would be used to fund additional research and development services including lead optimization.

Intellectual property created by the collaboration shall be owned by the Company, and background intellectual property improvements shall be owned by the party from whose background intellectual property they exclusively relate. If promising lead compounds are identified, the Company and DDF have the option (the “DDF Option”) to establish a jointly owned new company (“NewCo”) to advance the compounds through further development towards commercialization. NewCo will receive a royalty and milestone-bearing assignment and license of intellectual property from the Company for this purpose. The DDF Option is exercisable at any time until 90 days following the completion of the Research Plan and delivery of a final report. If DDF does not elect to exercise the DDF Option during the Option period, then DDF shall have no right in the collaboration intellectual property. NewCo will initially be owned 66% by the Company and 34% by DDF; however, the Company shall not be entitled to exercise more than 50% of the total voting rights related to its ownership interests. After completion of the DDF Option exercise, for a period of two years following the option exercise, NewCo shall have the right to initiate a new research program to develop up to three additional dementia targets, on a target by target basis, and the Company will be entitled to charge NewCo an agreed upon FTE rate for peptide screening and optimization for the active targets.

Either party may terminate the DDF Collaboration Agreement upon providing not less than 60 days written notice. A party may terminate the DDF Collaboration Agreement with immediate effect without notice if at any time the other party files for protection under bankruptcy or insolvency laws, makes an arrangement for the benefit of creditors, appoints a receiver, administrator, manager or trustee over its property, proposes a written agreement of composition or extension of its debts, is a party to any dissolution, winding-up or liquidation, or is in material breach that has not been remedied.

Accounting Analysis

The Company identified a single performance obligation associated with the performance of research and development services under the DDF Research Plan.

The Company concluded that the DDF Option is an immaterial obligation at the inception of the arrangement, as it represents a right to acquire shares of NewCo that have de minimis value. The DDF Option also does not contain a material right that otherwise would not have been received. The Company’s participation in the Research Advisory Panel was assessed as immaterial in the context of the contract. In addition, the Company concluded that the option for NewCo to obtain additional peptide screening and optimization services is not an obligation at the inception of the arrangement, as they are optional services and the amount that will be paid for the services do not reflect a discount that the customer would otherwise receive and do not provide the customer with material rights.

The total transaction price was initially determined to be $1.1 million, consisting of the upfront payment for research and development funding. The Company may receive additional milestone payments during the DDF Research Plan, as well as for research and development services for additional targets following the exercise of DDF Option. These variable amounts are excluded from the transaction price as they relate to fees that can only be achieved subsequent to the exercise of an option.

The transaction price was allocated to the single performance obligation of research and development services. The Company will recognize revenue as the underlying services are performed using a proportional performance model, over the period of service using input‑based measurements of total costs, including total full‑time equivalent effort incurred to date as a percentage of total costs expected, which best reflects the progress towards satisfaction of the performance obligation.

For the three months ended March 31, 2020 the Company recognized $0.1 million of revenue, and recorded deferred revenue of $0.6 million. As of December 31, 2019, the Company recorded deferred revenue of $0.7 million related to its collaboration with DDF.

Genentech Collaboration Agreement

On February 21, 2020, the Company entered into a Discovery Collaboration and License Agreement (the “Genentech Collaboration Agreement”) with Genentech. The collaboration is focused on the discovery and development of Bicycle peptides directed to biological targets selected by Genentech and aimed at developing up to four potential development candidates against multiple immuno-oncology targets suitable for Genentech to advance into further development and commercialization.

Under the terms of the Genentech Collaboration Agreement, Bicycle received a $30.0 million upfront, non-refundable payment. The initial discovery and optimization activities will focus on utilizing Bicycle’s phage screening technology to identify product candidates aimed at two immuno-oncology targets (“Genentech Collaboration Programs”), which may also include additional discovery and optimization of Bicycles as a targeting elements for each Genentech Collaboration Program (each a “Targeting Arm”). Genentech has the option to nominate up to two additional immuno-oncology targets (each, an “Expansion Option”), which may also include an additional Targeting Arm for each Expansion Option, as additional Genentech Collaboration Programs during a specified period following completion of certain activities under an agreed research plan. If Genentech exercises one or more Expansion Options, Genentech will pay to the Company an expansion fee of $10.0 million per Expansion Option. Genentech also has rights, under certain limited circumstances, to select an alternative target to be the subject of a Genentech Collaboration Program, in some cases subject to payment of an additional target selection fee.

If Genentech elects for Bicycle to perform discovery and optimization services for certain Targeting Arms, the Company will be entitled to receive an additional advance payment for the additional research services. Genentech exercised its right to select a Targeting Arm for one of the initial Genentech Collaboration Programs at the inception of the arrangement, which entitled the Company to an additional $1.0 million payment. If a Targeting Arm achieves specified criteria in accordance with the research plan, Genentech will be required to pay a further specified amount in the low single digit millions for each such Targeting Arm as consideration for the additional services to be provided.

Bicycle granted to Genentech a non-exclusive research license under Bicycle’s intellectual property solely to enable Genentech to perform any activities under the agreement. The activities under the Genentech Collaboration Agreement are governed by a joint research committee (“JRC”) with representatives from each of the Company and Genentech. The JRC will oversee, review and recommend direction of each Genentech Collaboration Program, achievement of development criteria, and variations of or modifications to the research plans.

After the Company performs the initial discovery and optimization activities in accordance with an agreed research plan and achieves specified criteria, Genentech will have the option to have the Company perform initial pre-clinical development and optimization activities in exchange for an additional specified milestone payment in the mid-single digit millions for each Genentech Collaboration Program (the “LSR Go Option”). Upon completion of such initial pre-clinical development and optimization activities for each Genentech Collaboration Program, Genentech will have the option to obtain an exclusive license to exploit any compound developed under such Genentech Collaboration Program in exchange for an additional specified payment in the mid to high single digit millions for each of the initial two Genentech Collaboration Programs and each of the two Expansion Option Genentech Collaboration Programs (the “Dev Go Option”).

On a Genentech Collaboration Program by Genentech Collaboration Program basis, if Genentech elects to obtain exclusive development and commercialization rights and pays the applicable LSR Go Option and Dev Go Option fees, Genentech will be required to make milestone payments to the Company upon the achievement of specified development, regulatory, and initial commercialization milestones for products arising from each collaboration program, totaling up to $200.0 million. Specifically, the Company is eligible for additional development milestones totaling up to $65.0 million, as well as regulatory milestones of up to $135.0 million for each collaboration program. In addition, the Company is also eligible to receive up to $200.0 million in sales milestone payments on a Genentech Collaboration Program-by-Genentech Collaboration Program basis. In addition, to the extent any of the product candidates covered by the licenses conveyed to Genentech are commercialized, the Company would be entitled to receive tiered royalty payments on net sales at percentages ranging from the mid-single to low double-digits, subject to certain standard reductions and offsets. Royalties will be payable, on a product by product and country by country basis, until the later of the expiration of specified licensed patents covering such product in such country, or ten years from first commercial sale of such product in such country.

Accounting Analysis

Upon the execution of the Genentech Collaboration Agreement, the Company has identified the following performance obligations:

(i)

Research license, and the related research and development and preclinical services through LSR Go for a first Genentech Collaboration Program (Genentech Collaboration Program #1);

(ii)

Research license, and the related research and development and preclinical services through LSR Go for a second Genentech Collaboration Program with a specified Targeting Arm (Genentech Collaboration Program #2);

(iii)

Material right associated with an option to a specified Targeting Arm for Genentech Collaboration Program #1;

(iv)

Two material rights associated with the LSR Go Option for Genentech Collaboration Program #1 and Genentech Collaboration Program #2, which includes research services to be provided through the Dev Go Option and an option to receive an exclusive license;

(v)

Material rights associated with certain limited substitution rights with respect to a limited number of collaboration targets;

(vi)

Two material rights related to each Genentech Expansion Option, which upon exercise include the services for an additional immuno-oncology target through the LSR Go Option, an LSR Go Option which includes the services to be provided through the Dev Go Option and an option to receive an exclusive license, limited substitution rights, and an option to select a specified Targeting Arm

The Company concluded that certain substitution rights that require the payment of additional consideration, which approximate the standalone selling price of the underlying services to be provided, do not provide the customer with a material right and therefore, are not considered as performance obligations and are accounted for as separate a contracts upon exercise, if ever. The Company’s participation in the joint steering committee was assessed as immaterial in the context of the contract.

The Company has concluded that the research license is not distinct from the research and development services as Genentech cannot obtain the benefit of the research license without the Company performing the research and development services. The services incorporate proprietary technology and unique skills and specialized expertise, particularly as it relates to constrained peptide technology that is not available in the marketplace. As a result, for each research program, the research license has been combined with the research and development services into a single performance obligation. In addition, the Company concluded that the Dev Go Option is not distinct or separately exercisable from the LSR Go Option, as the customer cannot benefit from the Dev Go Option unless and until the LSR Go Option is exercised.

In assessing whether the various options under the Genentech Collaboration Agreement represent material rights, the Company considered the additional consideration the Company would be entitled to upon the option exercise, the standalone selling price of the underlying goods, services, and additional options. For the material rights identified above the Company concluded that each of the options provided Genentech with a discount that it otherwise would not have received.

The total transaction price was initially determined to be $31.0 million, consisting of the $30.0 million upfront fee and the additional $1.0 million for Genentech’s selection of a new Targeting Arm at inception. The Company utilizes the most likely amount method to determine the amount of research and development funding to be received. Additional consideration to be paid to the Company upon the exercise of options by Genentech and subsequent milestones are excluded from the transaction price as they relate to option fees and milestones that can only be achieved subsequent to the exercise of an option. In addition, other variable consideration for development milestones not subject to option exercises was fully constrained, as a result of the uncertainty regarding whether any of the milestones will be achieved.

The transaction price was allocated to the performance obligations based on the relative estimated standalone selling prices of each performance obligation. The estimated standalone selling prices for the Genentech Collaboration Programs was based on the nature of the services to be performed and estimates of the associated effort and costs of the services, adjusted for a reasonable profit margin for what would be expected to be realized under similar contracts. The estimated standalone selling price for the material rights was determined based on the fees Genentech would pay to exercise the options, the estimated value of the underlying goods and services, and the probability that Genentech would exercise the option and any underlying options. Based on the relative standalone selling price, the allocation of the transaction price to the separate performance obligations is as follows (in thousands):


	Allocation of
Performance Obligations	Transaction Price
Genentech Collaboration Program #1 Performance Obligation	$	3,775
Genentech Collaboration Program #2 Performance Obligation		7,550
Specified Targeting Arm Material Right Arm for Genentech Collaboration Program #1		330
Two material rights associated with the LSR Go Option for Collaboration Programs #1 and #2		11,650
Material rights associated with limited substitution rights		1,115
Two material rights for Expansion Options		6,580
	$	31,000

The Company will recognize revenue related to amounts allocated to the Genentech Collaboration Program #1 and #2 Performance Obligations as the underlying services are performed using a proportional performance model over the period of service using input‑based measurements of total full‑time equivalent efforts and external costs incurred to date as a percentage of total full‑time equivalent time and external expected, which best reflects the progress towards satisfaction of the performance obligation. The amount allocated to the material rights is recorded as deferred revenue and the Company will commence revenue recognition upon exercise of or upon expiry of the respective option. The Company anticipates that the Genentech Collaboration Performance Program #1 and #2 obligations will be performed over a period of approximately two years, and the material rights will be exercised or expire within approximately four years from contract execution.

During the three months ended March 31, 2020, the Company commenced development activities related to Genentech Collaboration Programs #1 and #2 and recognized revenue of $0.7 million for the three months ended March 31, 2020. As of March 31, 2020, the Company recorded $29.0 million of deferred revenue in connection with the Genentech Collaboration Agreement.

Summary of Contract Assets and Liabilities

Up‑front payments and fees are recorded as deferred revenue upon receipt or when due until such time as the Company satisfies its performance obligations under these arrangements. A contract asset is a conditional right to consideration in exchange for goods or services that the Company has transferred to a customer. Amounts are recorded as accounts receivable when the Company’s right to consideration is unconditional.

The following table presents changes in the balances of the Company’s contract assets and liabilities (in thousands):


	Balance at						Impact of		Balance at
	Beginning of						Exchange		End of
	Period		Additions		Deductions		Rates		Period
Period ended March 31, 2020
Contract assets	$	—	$	—	$	—	$	—	$	—
Contract liabilities:
Deferred revenue
AstraZeneca collaboration deferred revenue		4,913		—		(412)		157		4,658
DDF collaboration deferred revenue		744		—		(56)		(48)		640
Genentech collaboration deferred revenue		—		31,000		(661)		(1,384)		28,955
Total deferred revenue	$	5,657	$	31,000	$	(1,129)	$	(1,275)	$	34,253


	Balance at						Impact of		Balance at
	Beginning of						Exchange		End of
	Period		Additions		Deductions		Rates		Period
Period ended December 31, 2019
Contract assets	$	—	$	149	$	(149)	$	—	$	—
Contract liabilities:
Deferred revenue
AstraZeneca collaboration deferred revenue		4,727		58		(35)		163		4,913
Sanofi collaboration deferred revenue		9,908		—		(9,984)		76		—
DDF collaboration deferred revenue		—		1,114		(394)		24		744
Total deferred revenue	$	14,635	$	1,172	$	(10,413)	$	263	$	5,657

The contract assets represent research and development services which have been performed but have not yet been billed, and are reduced when they are subsequently billed.

The AstraZeneca deferred revenue balance at March 31, 2020 includes $4.7 million allocated to the Target 3, Target 4, Target 5 and Target 6 Material Rights, which will commence revenue recognition when the respective option is exercised at the end of AZ Research Term or when the option expires.

The Genentech deferred revenue balance at March 31, 2020 includes $19.7 million allocated to material rights that will commence revenue recognition when the respective option is exercised or when the option expires.

During the three months ended March 31, 2020 and 2019, the Company recognized the following revenues as a result of changes in the contract asset and the contract liability balances in the respective periods (in thousands):


	Three Months Ended
	March 31,
	2020		2019
Revenue recognized in the period from:
Revenue recognized based on proportional performance	$	(1,129)	$	(1,044)
Revenue recognized based on expiration of material rights		—		(5,340)
Total	$	(1,129)	$	(6,384)

Cancer Research UK

BT1718

On December 13, 2016, the Company entered into a Clinical Trial and License Agreement with Cancer Research Technology Limited (“CRTL”) and Cancer Research UK (“CRUK”) (the “CRUK Agreement”). Pursuant to the CRUK Agreement, as amended in March 2017 and June 2018, CRUK’s Centre for Drug Development will sponsor and fund a Phase Ia and Phase IIa clinical trial for the Company’s lead product candidate, BT1718, a Bicycle Toxin Conjugate, in patients with advanced solid tumors.

CRUK is responsible to design, prepare, carry out and sponsor the clinical trial at its cost. The Company is responsible for supplying agreed quantities of GMP materials for the study, the supply of which has been completed. In the event that additional quantities are needed, the Company will provide CRUK with all reasonable assistance to complete the arrangements necessary for the generation and supply of such additional GMP materials but CRUK will be responsible for supplying and paying for such additional quantities of GMP materials.

The Company granted CRUK a license to its intellectual property in order to design, prepare for, sponsor, and carry out the clinical trial the Company retains the right to continue the development of BT1718 during the clinical trial. Upon the completion of the Phase I/IIa clinical study, the Company has the right to obtain a license to the results of the clinical trial upon the payment of a milestone, in cash and ordinary shares, with a combined value in the mid six digit dollar amount. If such license is not acquired, or if it is acquired and the license is terminated and the Company decides to abandon development of all products that deliver cytotoxic payloads to the MT1 target antigen, the Company will assign or grant to CRTL an exclusive license to develop and commercialize the product on a revenue sharing basis (in which case the Company will receive tiered royalties of 70% to 90% of the net revenue depending on the stage of development when the license is granted). The CRUK Agreement contains additional future milestone payments upon the achievement of development and regulatory milestones, payable in cash and shares, with an aggregate total value of $50.9 million, as well as royalty payments based on a high double digit percentage on net sales of products developed.

The CRUK Agreement can be terminated by either party upon an insolvency event, material breach of the terms of the contract, or upon a change in control (and the new controlling entity generates its revenue from the sale of tobacco products or is an affiliate of such party). CRUK may terminate the arrangement for safety reasons or if it determines that the objectives of the clinical trial will not be met, in which case, if the study is terminated by CRUK prior to the completion of the Phase 1a dose escalation portion of the study for such reasons or if CRUK refuses release of any additional quantities of GMP materials or if the parties cannot agree upon a plan to supply the additional quantities of GMP materials, the Company will be obligated to refund fifty percent of the costs and expenses incurred or committed by CRUK to perform the clinical trial. If the study is terminated by CRUK for an insolvency event, a material breach by the Company, or if the Company is acquired by an entity that generates its revenue from the sale of tobacco products or is an affiliate of such party, the Company will reimburse CRUK in full for all costs paid or committed in connection with the clinical trial and no further license payments, where applicable, shall be due. In such case where the Company is acquired by an entity that generates its revenue from the sale of tobacco products or is an affiliate of such party, CRUK will not be obliged to grant a license to the Company in respect of the results of the clinical trial and the Company will assign or grant to CRTL an exclusive license to develop and commercialize the product without CRTL being required to make any payment to the Company.

The Company concluded that the costs incurred by CRUK is a liability in accordance with ASC 730, Research and Development, as the payment is not based solely on the results of the research and development having future economic benefit. As such, the Company recorded a liability of $2.0 million and $2.0 million at March 31, 2020 and at December 31, 2019, which is recorded in other long‑term liabilities in the condensed consolidated balance sheets. The liability is recorded as incremental research and development expense in the statements of operations and comprehensive loss.

BT7401

In December 2019, the Company entered into a clinical trial and license agreement with Cancer Research Technology Limited and CRUK. Pursuant to the agreement, CRUK’s Centre for Drug Development will fund and sponsor development of BT7401, a multivalent Bicycle CD137 agonist, from current preclinical studies through the completion of a Phase IIa trial in patients with advanced solid tumors.

The Company granted to CRUK a license to the Company’s intellectual property in order to design, prepare for, sponsor, and carry out the clinical trial and all necessary preclinical activities to support the trial. The Company retains the right to continue the development of BT7401 during the clinical trial. Upon the completion of the Phase I/IIa clinical study, the Company has the right to obtain a license to the results of the clinical trial upon the payment of a milestone, in cash and ordinary shares, with a combined value in the mid six digit dollar amount. If such license is not acquired, or if it is acquired and the license is terminated and the Company decides to abandon development of all products that contain BT7401 or all the pharmaceutically active parts of BT7401, CRTL may elect to receive an exclusive license to develop and commercialize the product on a revenue sharing basis (in which case the Company will receive tiered royalties of 55% to 80% of the net revenue depending on the stage of development when the license is granted) less certain costs, as defined by the agreement. The CRUK agreement contains additional future milestone payments upon the achievement of development, regulatory and commercial milestones, payable in cash, with an aggregate total value of up to $60.3 million for each licensed product, as well as royalty payments based on a single digit percentage on net sales of products developed, and sublicense royalties to the CRUK in the very low double digit percentage of sublicense income depending on the stage of development when the license is granted.

The CRUK agreement can be terminated by either party upon an insolvency event, material breach of the terms of the contract, or upon a change in control (and the new controlling entity generates its revenue from the sale of tobacco products), or upon written notice by either party prior to the last cycle of treatment has been completed under the clinical trial. If the study is terminated by the Company prior to the filing of a clinical trial authorization, or by CRUK for an insolvency event or a material breach by the Company prior to the start of a clinical trial, the Company will reimburse CRUK for certain costs paid or committed prior to the start of the clinical trial. In such case where the Company is acquired by an entity that generates its revenue from the sale of tobacco products, CRUK will not be obliged to grant a license to us in respect of the results of the clinical trial and CRTL may elect to receive an exclusive license to develop and commercialize the product without CRTL being required to make any payment to the Company. There were no material activities initiated under the BT7401 CRUK arrangement as of March 31, 2020.

Income Taxes	3 Months Ended
Income Taxes	Mar. 31, 2020
Income Taxes
Income Taxes	11. Income Taxes During the three months ended March 31, 2020, the Company recorded an income tax benefit of $0.1 million. During the three months ended March 31, 2019, the Company recorded an income tax provision of $0.1 million. The Company is subject to United Kingdom corporate taxation. Due to the nature of its business, the Company has generated losses since inception and has therefore not paid United Kingdom corporation tax. The Company's income tax benefit is mainly the result of deferred tax assets benefitted in the United States that do not have a valuation allowance against them because of profits that will be generated by an intercompany service agreement. The Company's income tax provision recognized represents income tax payable in the United States on profits generated from an intercompany service arrangement. The Company regularly assesses its ability to realize its deferred tax assets. Assessing the realization of deferred tax assets requires significant judgment. In determining whether its deferred tax assets are more likely than not realizable, the Company evaluated all available positive and negative evidence, and weighed the evidence based on its objectivity. After consideration of the evidence, including the Company’s history of cumulative net losses in the United Kingdom, and the Company has concluded that it is more likely than not that the Company will not realize the benefits of its U.K. deferred tax assets and accordingly the Company has provided a valuation allowance for the full amount of the net deferred tax assets in the United Kingdom. The Company has considered the Company’s history of cumulative net profits in the United States, estimated future taxable income and concluded that it is more likely than not that the Company will realize the benefits of its United States deferred tax assets and has not provided a valuation allowance against the net deferred tax assets in the United States. The Company recorded a valuation allowance against all of its U.K. deferred tax assets as of March 31, 2020 and December 31, 2019. The Company intends to continue to maintain a full valuation allowance on its U.K. deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. The release of the valuation allowance would result in the recognition of certain deferred tax assets and an increase to the benefit from income taxes for the period the release is recorded. However, the exact timing and amount of the valuation allowance release are subject to change on the basis of the level of profitability that the Company is able to actually achieve. The (benefit from) provision for income taxes shown on the condensed consolidated statements of operations differs from amounts that would result from applying the statutory tax rates to income before taxes primarily because of certain permanent expenses that were not deductible, U.K., federal and state research and development credits, as well as the application of valuation allowances against the U.K. deferred tax assets.

Commitments and Contingencies

3 Months Ended

Mar. 31, 2020

Commitments and Contingencies

Commitments and Contingencies

12. Commitments and Contingencies

Leases

In September 2017, Bicycle Therapeutics Inc. entered into a lease agreement for office and laboratory space in Lexington, Massachusetts, which commenced on January 1, 2018 and expires on December 31, 2022. Bicycle Therapeutics Inc. has the option to extend for a successive period which is not included in the lease term as it is not reasonably certain that the option will be exercised. In conjunction with the lease agreement, Bicycle Therapeutics Inc. paid a security deposit of $0.2 million as well as prepaid rent of $0.1 million for the first month of the third, fourth, and fifth year of the lease. The deposit is recorded in other assets in the condensed consolidated balance sheets. The Company has recorded a right‑of‑use asset (inclusive of the impact of prepaid rent) and corresponding lease liability, by calculating the present value of lease payments, discounted at 9%, the incremental borrowing rate, over the lease term.

In October 2017, the Company entered into a lease agreement for office and laboratory space in Building 900, Babraham Research Campus, Cambridge, U.K., which expires on December 21, 2021. The annual rent is approximately $0.5 million. The Company has the right to renew the lease for five years commencing December 21, 2021, which is not included in the lease term as it is not reasonably certain that the right will be exercised. Service charges are also payable based on floor area and are estimated to be approximately $0.1 million per year. In conjunction with the 2017 lease agreement, the Company paid a security deposit of $0.6 million, which is recorded in other assets in the condensed consolidated balance sheets. The Company has recorded a right‑of‑use asset and corresponding lease liability, by calculating the present value of lease payments, discounted at 7.75%, the incremental borrowing rate, over the lease term.

The Company identified and assessed the following significant assumptions in recognizing the right‑of‑use assets and corresponding lease liabilities:

Expected lease term — The expected lease term includes both contractual lease periods and, when applicable, cancelable option periods when it is reasonably certain that the Company would exercise such options. The Company has not included any option periods in the expected lease term as it is not reasonably certain that the Company will exercise such options.

Incremental borrowing rate — The Company’s lease agreements do not provide an implicit rate. As the Company does not have any external borrowings for comparable terms of its leases, the Company estimated the incremental borrowing rate by comparing interest rates available in the market for similar borrowings and third‑party quotations.

Lease and non‑lease components — In certain cases, the Company is also responsible for certain additional charges for operating costs, including insurance, maintenance, taxes, and other costs incurred, which are billed based on both usage and as a percentage of the Company’s share of total square footage. The amounts paid are considered non‑lease components. The Company has elected the practical expedient which allows the non‑lease components to be combined with the lease components. The payments for other operating costs are considered variable lease cost and are recognized in the period in which the costs are incurred.

The components of the Company’s lease expense, which are recorded as a component of research and development expenses and general and administrative expenses in the condensed consolidated statement of operations and comprehensive loss are as follows (in thousands):


	March 31,
	2020
Operating lease cost	$	223
Variable lease cost		139
Total lease cost	$	362
Weighted‑average remaining operating lease term (years)		2.4
Weighted‑average discount rate		8.56	%

The following table summarizes the maturities of the Company’s operating leases as of March 31, 2020 (in thousands):


Year Ending December 31,
2020	$	743
2021		751
2022		443
2023		—
2024		—
Present value adjustment		(245)
Total lease liabilities	$	1,692
Less: current lease liabilities		(636)
Long term lease liabilities	$	1,056

The Company has entered into various agreements with contract manufacturing organizations to provide clinical trial materials and with vendors for preclinical research studies, synthetic chemistry and other services for operating purposes. These payments are not included in the table of operating lease payments above since the contracts are generally cancelable at any time upon less than 90 days’ prior written notice. The Company is not contractually able to terminate for convenience and avoid any and all future obligations to these vendors. Under such agreements, the Company is contractually obligated to make certain minimum payments to the vendors, with the payments in the event of a termination with less than 90 days’ notice based on the timing of the termination and the exact terms of the agreement.

Legal proceedings

From time to time, the Company or its subsidiaries may become involved in various legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business.

In September 2016, the Company’s subsidiary, Bicycle RD Limited (“BicycleRD”), filed a complaint in the District Court of The Hague (the “District Court”) against Pepscan Systems B.V. and its affiliates (“Pepscan”) to contest the right of Pepscan to terminate a non‑exclusive patent license agreement entered into with Pepscan in 2009. BicycleRD included a conditional claim for a ruling that the licensed patent relevant to BicycleRD’s activities is invalid. In response, Pepscan counterclaimed for injunctive relief and unquantified damages. The Company is vigorously prosecuting its claims and defending against those of Pepscan. The Company does not believe that a loss is probable or estimable at this time, and as such, the Company has not recorded a liability related to the Pepscan litigation as of March 31, 2020 and December 31, 2019. Should the Company not be successful in maintaining its rights to Pepscan’s patent or in the Company’s alternative demand that the patent be invalidated, commercialization of the Company’s lead product could be delayed. As the Pepscan patent is expected to expire prior to the expected commercialization date of the product, the Company does not believe that the legal proceedings could have a material adverse effect on the Company’s business and operating results.

Founder Royalty arrangements

At the time BicycleRD was organized, BicycleRD entered into a royalty agreement with its founders and initial investors (the “Founder Royalty Agreement”). Pursuant to the Founder Royalty Agreement, as amended in May 2017, the Company will pay a royalty rate in the low single digit percentages on net product sales that could be generated under the collaborations with Oxurion and AstraZeneca to its founders and initial investors, for a period of 10 years from the first commercial sale on a country by country basis. No royalties have been earned or paid under the royalty arrangements to date.

Indemnification obligations

In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties. In addition, the Company has indemnification obligations towards members of its board of directors that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. The maximum potential amount of future payments the Company could be required to make under these indemnification arrangements is, in many cases, unlimited. To date, the Company has not incurred any material costs as a result of such indemnification obligations. The Company is not aware of any claims under indemnification arrangements, and therefore it has not accrued any liabilities related to such obligations in its condensed consolidated financial statements as of March 31, 2020 and December 31, 2019.

Net loss per share

3 Months Ended

Mar. 31, 2020

Net loss per share

Net loss per share

13. Net loss per share

Basic and diluted net loss per share attributable to ordinary shareholders was calculated as follows (in thousands, except share and per share amounts):


	Three Months Ended
	March 31,
	2020		2019
Numerator:
Net loss attributable to ordinary shareholders	$	(11,324)	$	(6,503)
Denominator:
Weighted average ordinary shares outstanding, basic and diluted		17,997,929		834,043
Net loss per share attributable to ordinary shareholders, basic and diluted	$	(0.63)	$	(7.80)

The Company’s potentially dilutive securities which include share options, and which prior to the completion of the IPO included convertible preferred shares, warrants to subscribe for Series A and Series B1 Preferred Shares, and unvested restricted shares, have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share. Therefore, the weighted average number of ordinary shares outstanding used to calculate both basic and diluted net loss per share attributable to ordinary shareholders is the same. The Company excluded the following potentially dilutive ordinary shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to ordinary shareholders for the periods indicated because including them would have had an anti‑dilutive effect:


	Three Months Ended
	March 31,
	2020	2019
Convertible preferred shares (as converted to ordinary shares)	—	11,647,529
Warrants to subscribe for convertible preferred shares (as adjusted to reflect the impact of the share capital reorganization and issuance of bonus shares (Note 6))(1)(2)	71,450	1,347,953
Restricted ordinary shares	—	56,643
Options to purchase ordinary shares	3,654,888	930,861
	3,726,338	13,982,986

(1)

On March 7, 2019, the holders of the Series B1 warrants to subscribe for Series B1 Preferred Shares agreed that 50% of the warrants would be exercised in conjunction with the IPO and 50% of the warrants would expire.

(2)

At March 31, 2020, 50,000 warrants are outstanding which are exercisable into 71,450 ordinary shares (Note 6).

Benefit plans	3 Months Ended
Benefit plans	Mar. 31, 2020
Benefit plans
Benefit plans	14. Benefit plans The Company established a defined‑contribution savings plan under Section 401(k) of the Code (the “401(k) Plan”). The 401(k) Plan covers all U.S. employees and allows participants to defer a portion of their annual compensation on a pre‑tax basis. Matching contributions to the 401(k) Plan may be made at the discretion of the Company’s board of directors. During each of the three months ended March 31, 2020 and 2019, the Company made contributions totaling $0.1 million to the 401(k) Plan. The Company provides a pension contribution plan for its employees in the United Kingdom, pursuant to which the Company may match employees’ contributions each year (“U.K Plan”). During each of the three months ended March 31, 2020 and 2019, the Company made contributions totaling $0.1 million to the U.K. Plan.

Related party transactions	3 Months Ended
Related party transactions	Mar. 31, 2020
Related party transactions
Related party transactions	15. Related party transactions The Company has entered into the Founder Royalty Agreements with its founders and initial investors (Note 12). No royalties have been earned or paid under the Founder Royalty Agreements to date. The Chairman of the Company’s Board of Directors is associated with Stone Sunny Isles Inc., which provided consultancy services to the Company totaling $40,000 and zero during the three months ended March 31, 2020 and 2019, respectively. The former Chairman of the Company’s Board of Directors is associated with 10X Capital Inc., which provided consultancy services to the Company totaling zero and $50,000 during the three months ended March 31, 2020 and 2019, respectively.

Geographic information

3 Months Ended

Mar. 31, 2020

Geographic information

Geographic information

16. Geographic information

The Company operates in two geographic regions: the United States and the United Kingdom. Information about the Company’s long‑lived assets, including operating lease right‑of‑use assets, held in different geographic regions is presented in the table below (in thousands):


	March 31,		December 31,
	2020		2019
United States	$	1,971	$	2,017
United Kingdom		2,047		2,331
	$	4,018	$	4,348

The Company’s collaboration revenues are attributed to the operations of the Company in the United Kingdom.

Summary of significant accounting policies (Policies)	3 Months Ended
Summary of significant accounting policies (Policies)	Mar. 31, 2020
Summary of significant accounting policies
Use of estimates	Use of estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting periods. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the accrual for research and development expenses, revenue recognition, the fair value of ordinary shares and the valuation of the warrant liability prior to the Company’s IPO, share-based compensation expense, and income taxes. The Company bases its estimates on historical experience, known trends and other market‑specific or other relevant factors that it believes to be reasonable under the circumstances. Estimates are periodically reviewed in light of reasonable changes in circumstances, facts and experience and may be changed as new events occur and additional information is obtained. As of the date of issuance of these financial statements, the Company is not aware of any specific event or circumstance that would require the Company to update its estimates, assumptions and judgments or revise the carrying value of its assets or liabilities. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates or assumptions, and any such differences may be material to the Company’s financial statements.
Significant Risks and Uncertainties	Significant Risks and Uncertainties With the global spread of the ongoing COVID-19 pandemic in the first quarter of 2020, the Company established a cross-functional task force and implemented business continuity plans designed to address and mitigate the impact of the COVID-19 pandemic on the Company’s business. While the Company is experiencing limited financial impacts at this time, the extent to which the COVID-19 pandemic impacts the Company’s business, clinical development and regulatory efforts, corporate development objectives and the value of and market for the Company’s ADSs, will depend on future developments that are highly uncertain and cannot be predicted with confidence at this time, such as the ultimate duration of the pandemic, travel restrictions, quarantines, social distancing and business closure requirements in the United Kingdom, United States, Europe and other countries, and the effectiveness of actions taken globally to contain and treat the disease. The global economic slowdown, the overall disruption of global healthcare systems and the other risks and uncertainties associated with the pandemic could have a material adverse effect on the Company’s business, financial condition, results of operations and growth prospects. In addition, the Company is subject to other challenges and risks specific to its business and ability to execute its strategy, as well as risks and uncertainties common to companies in the biotechnology industry, including but not limited to: risks of failure of preclinical studies and clinical trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the need to successfully commercialize and gain market acceptance of its product candidates, dependence on key personnel and collaboration partners, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations, and the ability to secure additional capital to fund operations. In addition, to the extent the ongoing COVID-19 pandemic adversely affects the Company’s business and results of operations, it may also have the effect of heightening many of the other risks and uncertainties discussed above.
Unaudited Interim Financial Information	Unaudited Interim Financial Information Certain information in the footnote disclosures of the financial statements has been condensed or omitted pursuant to the rules and regulations of the SEC. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2019 included in the Company’s 2019 Annual Report. The accompanying condensed consolidated balance sheet at March 31, 2020, condensed consolidated statements of operations and comprehensive loss, condensed consolidated statements of convertible preferred shares and shareholders’ equity (deficit) and condensed consolidated statements of cash flows for the three months ended March 31, 2020 and 2019, and the related financial information disclosed in these notes are unaudited. The unaudited interim financial statements have been prepared on the same basis as the audited annual financial statements for the year ended December 31, 2019, and, in the opinion of management, reflect all adjustments, consisting of normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of March 31, 2020, the results of its operations for the three months ended March 31, 2020 and 2019, and its cash flows for the three months ended March 31, 2020 and 2019. The results for the three months ended March 31, 2020 are not necessarily indicative of the results to be expected for the year ending December 31, 2020, any other interim periods, or any future year or period.
Foreign currency and currency translation	Foreign currency and currency translation The functional currency is the currency of the primary economic environment in which an entity’s operations are conducted. On June 1, 2019, Bicycle Therapeutics plc adopted the U.S. dollar (“USD”) as its functional currency. Bicycle Therapeutics plc is a holding company that has no operating activities and its primary functions are to serve as a financing vehicle to fund the operations of the Company’s operating entities, to serve as the listing company needed to access U.S. capital markets, and to hold investments. Therefore, its financing source is the primary indicator of its cash flows and its functional currency. The change in functional currency from the British Pound Sterling is due to a change in the source of Bicycle Therapeutics plc’s financing and cash flows, which following the completion of the IPO is now primarily the U.S. dollar. Historically its financing had been in British Pound Sterling. The functional currency of Bicycle Therapeutics plc’s wholly owned non-U.S. subsidiaries, BicycleTx Limited and BicycleRD Limited, is the British Pound Sterling and the functional currency of its U.S. subsidiary, Bicycle Therapeutics Inc. is the USD. The functional currency of the Company’s subsidiaries is the same as the local currency. Monetary assets and liabilities denominated in currencies other than the functional currency are remeasured into the functional currency at rates of exchange prevailing at the balance sheet dates. Non-monetary assets and liabilities denominated in foreign currencies are remeasured into the functional currency at the exchange rates prevailing at the date of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the determination of net loss for the respective periods. Adjustments that arise from exchange rate changes on transactions denominated in a currency other than the local currency are included in general and administrative expense in the condensed consolidated statements of operations and comprehensive loss as incurred. The Company recorded a foreign exchange gain of $1.3 million and an exchange loss of $0.3 million during the three months ended March 31, 2020 and 2019, respectively. The Company translates the assets and liabilities of BicycleTx Limited and BicycleRD Limited into USD at the exchange rate in effect on the balance sheet date. Revenues and expenses are translated at the average exchange rate in effect during the period. Unrealized translation gains and losses are recorded as a foreign currency translation adjustment, which is included in the condensed consolidated statements of convertible preferred shares and shareholders’ equity (deficit) as a component of accumulated other comprehensive income (loss).
Recently issued accounting pronouncements	Recently issued accounting pronouncements In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 will change how companies account for credit losses for most financial assets and certain other instruments. For trade receivables, loans and held-to-maturity debt securities, companies will be required to recognize an allowance for credit losses rather than reducing the carrying value of the asset. ASU 2016-13 was effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. In November 2019, the FASB issued ASU No. 2019-10, Financial Instruments — Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates to amend the effective date of ASU 2016-13, for entities eligible to be smaller reporting companies as defined by the SEC, to be effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the potential impact that the adoption of ASU 2016-13 will have on the Company’s financial position and results of operations

Property and equipment, net (Tables)

3 Months Ended

Mar. 31, 2020

Property and equipment, net

Schedule of property and equipment, net

Property and equipment, net consisted of the following (in thousands):


	March 31,		December 31,
	2020		2019
Laboratory equipment	$	4,256	$	4,326
Leasehold improvements		363		300
Computer equipment and software		222		229
Furniture and office equipment		184		120
		5,025		4,975
Less: Accumulated depreciation and amortization		(2,822)		(2,683)
	$	2,203	$	2,292

Accrued expenses and other current liabilities (Tables)

3 Months Ended

Mar. 31, 2020

Accrued expenses and other current liabilities

Schedule of accrued expenses and other current liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):


	March 31,		December 31,
	2020		2019
Accrued employee compensation and benefits	$	1,081	$	2,514
Accrued external research and development expenses		3,142		2,055
Income taxes payable		7		1
Accrued professional fees		717		867
Current portion of operating lease liabilities		636		640
Other		133		67
	$	5,716	$	6,144

Share-based compensation (Tables)

3 Months Ended

Mar. 31, 2020

Share-based compensation

Schedule of share based compensation expense

The Company recorded share‑based compensation expense in the following expense categories of its condensed consolidated statements of operations and comprehensive loss (in thousands):


	Three Months Ended
	March 31,
	2020		2019
Research and development expenses	$	675	$	108
General and administrative expenses		1,446		168
	$	2,121	$	276

Schedule of share option activity


				Weighted
		Weighted		Average	Aggregate
	Number of	Average		Contractual	Intrinsic
	Shares	Exercise Price		Term	Value
				(in years)	(in thousands)
Outstanding as of December 31, 2019	2,634,346	$	9.57	9.04	$	2,868
Granted	1,030,361		10.17	—		—
Exercised	(1,071)		1.47	—		—
Forfeited	(8,748)		8.67	—		—
Outstanding as of March 31, 2020	3,654,888	$	9.74	9.17	$	14,973
Vested and expected to vest as of March 31, 2020	3,654,888	$	9.74	9.17	$	14,973
Options exercisable as of March 31, 2020	984,491	$	7.71	8.79	$	5,993

Schedule of assumptions used to determine the fair value of share options granted


	Three
	Months
	Ended
	March 31,
	2020		2019
Risk-free interest rate	1.6	%	2.7	%
Expected volatility	73.7	%	79.6	%
Expected dividend yield	—		—
Expected term (in years)	5.95		6.07

Significant Agreements (Tables)

3 Months Ended

Mar. 31, 2020

Significant agreements.

Summary of revenue recognized from collaboration arrangements

The following table summarizes the revenue recognized in the Company’s condensed consolidated statements of operations and comprehensive loss from the Company’s collaboration agreements (in thousands):


	Three Months
	Ended
	March 31,
	2020		2019
Collaboration revenues
AstraZeneca	$	412	$	425
Sanofi		—		5,959
Dementia Discovery Fund		56		—
Genentech		661		—
Total collaboration revenues	$	1,129	$	6,384

Summary of changes in the balances of the Company’s contract assets and liabilities

The following table presents changes in the balances of the Company’s contract assets and liabilities (in thousands):


	Balance at						Impact of		Balance at
	Beginning of						Exchange		End of
	Period		Additions		Deductions		Rates		Period
Period ended March 31, 2020
Contract assets	$	—	$	—	$	—	$	—	$	—
Contract liabilities:
Deferred revenue
AstraZeneca collaboration deferred revenue		4,913		—		(412)		157		4,658
DDF collaboration deferred revenue		744		—		(56)		(48)		640
Genentech collaboration deferred revenue		—		31,000		(661)		(1,384)		28,955
Total deferred revenue	$	5,657	$	31,000	$	(1,129)	$	(1,275)	$	34,253


	Balance at						Impact of		Balance at
	Beginning of						Exchange		End of
	Period		Additions		Deductions		Rates		Period
Period ended December 31, 2019
Contract assets	$	—	$	149	$	(149)	$	—	$	—
Contract liabilities:
Deferred revenue
AstraZeneca collaboration deferred revenue		4,727		58		(35)		163		4,913
Sanofi collaboration deferred revenue		9,908		—		(9,984)		76		—
DDF collaboration deferred revenue		—		1,114		(394)		24		744
Total deferred revenue	$	14,635	$	1,172	$	(10,413)	$	263	$	5,657

Summary of recognition of revenues as a result of changes in contract asset and contract liability balances


	Three Months Ended
	March 31,
	2020		2019
Revenue recognized in the period from:
Revenue recognized based on proportional performance	$	(1,129)	$	(1,044)
Revenue recognized based on expiration of material rights		—		(5,340)
Total	$	(1,129)	$	(6,384)

AstraZeneca

Significant agreements.

Summary of allocation of transaction price to separate performance obligations

Based on the relative standalone selling price, the allocation of the transaction price to the separate performance obligations at the inception of the arrangement is as follows (in thousands):


	Allocation of
Performance Obligations	Transaction Price
Target Three Research License and Related Services	$	650
Target 3 Material Right		1,504
Target 4 Material Right		1,204
Target 5 Material Right		1,165
Target 6 Material Right		1,127
	$	5,650

Sanofi

Significant agreements.

Summary of allocation of transaction price to separate performance obligations

Based on the relative standalone selling price, the allocation of the transaction price to the separate performance obligations at the inception of the arrangement is as follows (in thousands):


	Allocation of
Performance Obligations	Transaction Price
Sickle Cell Research License and Related Services	$	1,405
Hemophilia Research License and Related Services		2,811
Sickle Cell License Option Material Right		5,286
Hemophilia License Option Material Right		4,698
	$	14,200

Genetech

Significant agreements.

Summary of allocation of transaction price to separate performance obligations

Based on the relative standalone selling price, the allocation of the transaction price to the separate performance obligations is as follows (in thousands):


	Allocation of
Performance Obligations	Transaction Price
Genentech Collaboration Program #1 Performance Obligation	$	3,775
Genentech Collaboration Program #2 Performance Obligation		7,550
Specified Targeting Arm Material Right Arm for Genentech Collaboration Program #1		330
Two material rights associated with the LSR Go Option for Collaboration Programs #1 and #2		11,650
Material rights associated with limited substitution rights		1,115
Two material rights for Expansion Options		6,580
	$	31,000

Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2020

Commitments and Contingencies

Schedule of components of lease expense


	March 31,
	2020
Operating lease cost	$	223
Variable lease cost		139
Total lease cost	$	362
Weighted‑average remaining operating lease term (years)		2.4
Weighted‑average discount rate		8.56	%

Schedule of maturities of operating leases

The following table summarizes the maturities of the Company’s operating leases as of March 31, 2020 (in thousands):


Year Ending December 31,
2020	$	743
2021		751
2022		443
2023		—
2024		—
Present value adjustment		(245)
Total lease liabilities	$	1,692
Less: current lease liabilities		(636)
Long term lease liabilities	$	1,056

Net loss per share (Tables)

3 Months Ended

Mar. 31, 2020

Net loss per share

Schedule of basic and diluted net loss attributable to ordinary shareholders

Basic and diluted net loss per share attributable to ordinary shareholders was calculated as follows (in thousands, except share and per share amounts):


	Three Months Ended
	March 31,
	2020		2019
Numerator:
Net loss attributable to ordinary shareholders	$	(11,324)	$	(6,503)
Denominator:
Weighted average ordinary shares outstanding, basic and diluted		17,997,929		834,043
Net loss per share attributable to ordinary shareholders, basic and diluted	$	(0.63)	$	(7.80)

Schedule of antidilutive securities excluded from computation of net loss per share attributable to ordinary shareholders

	Three Months Ended
	March 31,
	2020	2019
Convertible preferred shares (as converted to ordinary shares)	—	11,647,529
Warrants to subscribe for convertible preferred shares (as adjusted to reflect the impact of the share capital reorganization and issuance of bonus shares (Note 6))(1)(2)	71,450	1,347,953
Restricted ordinary shares	—	56,643
Options to purchase ordinary shares	3,654,888	930,861
	3,726,338	13,982,986

(1)

(2)

At March 31, 2020, 50,000 warrants are outstanding which are exercisable into 71,450 ordinary shares (Note 6).

Geographic information (Tables)

3 Months Ended

Mar. 31, 2020

Geographic information

Schedule of long-lived assets, including operating lease right-of-use assets, held in different geographic regions

Information about the Company’s long‑lived assets, including operating lease right‑of‑use assets, held in different geographic regions is presented in the table below (in thousands):


	March 31,		December 31,
	2020		2019
United States	$	1,971	$	2,017
United Kingdom		2,047		2,331
	$	4,018	$	4,348

Nature of the business and basis of presentation - Initial public offering (Details) $ / shares in Units, $ in Millions			1 Months Ended	3 Months Ended
	May 28, 2019 shares	Mar. 28, 2019 $ / shares shares	Jun. 30, 2019 shares	Mar. 31, 2020 USD ($)
IPO
Share capital reorganization and share split
Shares issued (in shares) \| shares		4,333,333
Share issue price \| $ / shares		$ 14.00
Proceeds from IPO, net \| $				$ 56.4
Underwriting discounts and commissions \| $				4.5
Offering expenses \| $				$ 4.0
IPO \| Ordinary Shares
Share capital reorganization and share split
Conversion of convertible preferred shares to ordinary shares (in shares) \| shares	11,647,529
Conversion ratio	0.6997
Over allotment option
Share capital reorganization and share split
Shares issued (in shares) \| shares			304,333

Nature of the business and basis of presentation- Liquidity (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Nature of business and basis of presentation
Net loss	$ 11,324	$ 6,503
Accumulated deficit	$ 111,874		$ 100,550

- Definition

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

+ References + Details

Summary of significant accounting policies - Foreign currency and currency translation (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Summary of significant accounting policies
Foreign exchange gains (loss)	$ 1.3	$ (0.3)

Fair value of financial assets and liabilities - Financial assets and liabilities measured at fair value (Details) - Recurring - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Fair value of financial assets and liabilities
Assets at fair value	$ 0	$ 0
Liabilities at fair value	$ 0	$ 0

Fair value of financial assets and liabilities - Cash and cash equivalents (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Fair value of financial assets and liabilities
Cash equivalents	$ 0	$ 0

Property and equipment, net (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Property and equipment, net
Property and equipment, gross	$ 5,025		$ 4,975
Less: Accumulated depreciation and amortization	(2,822)		(2,683)
Property and equipment, net	2,203		2,292
Depreciation expense	300	$ 200
Laboratory equipment
Property and equipment, net
Property and equipment, gross	4,256		4,326
Leasehold improvements
Property and equipment, net
Property and equipment, gross	363		300
Computer equipment and software
Property and equipment, net
Property and equipment, gross	222		229
Furniture and office equipment
Property and equipment, net
Property and equipment, gross	$ 184		$ 120

Accrued expenses and other current liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Accrued expenses and other current liabilities
Accrued employee compensation and benefits	$ 1,081	$ 2,514
Accrued external research and development expenses	3,142	2,055
Income taxes payable	7	1
Accrued professional fees	717	867
Current portion of operating lease liabilities	636	640
Other	133	67
Accrued expenses and other current liabilities	$ 5,716	$ 6,144

Convertible preferred shares (Details) $ / shares in Units, $ in Millions							1 Months Ended
	May 28, 2019 shares	Mar. 28, 2019 $ / shares shares	Jan. 03, 2019 USD ($) shares	Dec. 20, 2018 USD ($) shares	Oct. 27, 2017 USD ($) shares	May 26, 2017 USD ($) shares	May 31, 2019	Jan. 03, 2019 £ / shares	Dec. 20, 2018 £ / shares	Oct. 27, 2017 £ / shares	May 26, 2017 £ / shares
Convertible preferred shares
Number of bonus shares for each ordinary share							1.429
IPO
Convertible preferred shares
Number of shares issued (in shares)		4,333,333
Share issue price \| $ / shares		$ 14.00
Ordinary Shares \| IPO
Convertible preferred shares
Conversion of convertible preferred shares to ordinary shares (in shares)	11,647,529
Conversion ratio	0.6997
Series B1 Convertible Preferred Shares
Convertible preferred shares
Number of shares issued (in shares)					384,615	3,562,583
Share issue price \| £ / shares										£ 13.00	£ 11.2278
Gross proceeds from issues of shares \| $					$ 6.6	$ 51.9
Numbers of warrants issued				194,911	743,287
Number of warrants surrendered				194,911
Series B2 Convertible Preferred Shares
Convertible preferred shares
Number of shares issued (in shares)			80,385	1,323,248
Share issue price \| £ / shares								£ 15.55	£ 15.55
Gross proceeds from issues of shares \| $			$ 1.6	$ 26.1

Warrant liability - Warrants information (Details) $ in Thousands						3 Months Ended
	May 28, 2019 shares	Mar. 07, 2019	Dec. 20, 2018 shares	Oct. 27, 2017 £ / shares shares	May 26, 2017 £ / shares shares	Mar. 31, 2020 USD ($) shares	Mar. 31, 2019 USD ($)
Warrants information
Number of shares issued for warrant exercise	171,480
Remaining warrants exercisable	80,000					50,000
Number of shares into which remaining warrants is exercisable	114,320
Change in fair value of preferred stock warrant liability \| $						$ 0	$ 3,197
Other expenses
Warrants information
Change in fair value of preferred stock warrant liability \| $							$ 100
Series A Preferred Shares
Warrants information
Numbers of warrants issued					200,000
Exercise price of warrants \| £ / shares					£ 0.01
Warrants exercisable term					10 years
Warrants expiration term following an IPO or exit					12 months
Number of warrants exercised	120,000
Series B1 Preferred Shares
Warrants information
Numbers of warrants issued			194,911	115,384	627,903
Exercise price of warrants \| £ / shares				£ 0.01	£ 0.01
Number of shares issued for warrant exercise	531,077
Number of shares issued (in shares)				384,615	3,562,583
Share issue price \| £ / shares					£ 11.2278
Number of warrants surrendered			194,911
Percentage of warrants exercisable in conjunction with the IPO		50.00%
Percentage of warrants to expire in conjunction with the IPO		50.00%

Warrant liability - Roll-forward of fair values of warrant liability (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Roll-forward of the fair values of the Company’s warrant liability
Change in fair value of warrant liability	$ 0	$ 3,197

Ordinary shares (Details)	3 Months Ended
Ordinary shares (Details)	Mar. 31, 2020 Vote £ / shares shares	Dec. 31, 2019 £ / shares shares
Ordinary shares
Vote per ordinary share \| Vote	1
Ordinary shares, shares authorized \| shares	31,995,653	31,995,653
Ordinary shares, nominal value \| £ / shares	£ 0.01	£ 0.01

Share-based compensation (Details)		1 Months Ended	3 Months Ended	12 Months Ended
Share-based compensation (Details)	Jan. 01, 2020 shares	May 31, 2019 shares	Mar. 31, 2020 $ / shares shares	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2019 $ / shares	May 27, 2019 £ / shares
Stock option
Share-based compensation.
Exercise price \| $ / shares			$ 9.74			$ 9.57
Employee Share Purchase Plan
Share-based compensation.
Number of ordinary shares reserved for issuance		215,000
Percentage of annual increase in reserves on total number of ordinary shares outstanding		1.00%
Number of shares available for issuance		430,000
Increase in number of ordinary shares reserved for issuance	179,937
Percentage of ordinary shares at a price per share equal to the fair market value on offering date or purchase date		85.00%
2019 Plan
Share-based compensation.
Number of ordinary shares reserved for issuance	719,748
Number of shares available for issuance			567,433
Number of shares reserved for issuance		2,470,583
2019 Plan \| Stock option
Share-based compensation.
Percentage of annual increase in reserves on total number of ordinary shares outstanding		4.00%
Contractual life		10 years
2019 Plan \| Stock option \| First anniversary
Share-based compensation.
Vesting Percentage		25.00%
2019 Plan \| Stock option \| 36 equal monthly installments
Share-based compensation.
Number of equal monthly installments for vesting remaining awards		36 months
2019 Plan \| Minimum \| Stock option
Share-based compensation.
Vesting period		3 years
2019 Plan \| Maximum \| Stock option
Share-based compensation.
Vesting period		4 years
Pre-IPO Share Options and restricted shares \| Stock option
Share-based compensation.
Contractual life			10 years
Vesting period			4 years
Pre-IPO Share Options and restricted shares \| Stock option \| First anniversary
Share-based compensation.
Vesting Percentage			25.00%
Pre-IPO Share Options and restricted shares \| Stock option \| 36 equal monthly installments
Share-based compensation.
Number of equal monthly installments for vesting remaining awards			36 months
Pre-IPO Share Options and restricted shares \| Stock option \| United Kingdom
Share-based compensation.
Exercise price \| £ / shares							£ 0.01
Pre-IPO Share Options and restricted shares \| Performance based option \| First anniversary
Share-based compensation.
Vesting Percentage				20.00%	20.00%
Pre-IPO Share Options and restricted shares \| Performance based option \| 36 equal monthly installments
Share-based compensation.
Vesting Percentage				60.00%	60.00%
Number of equal monthly installments for vesting remaining awards				36 months	36 months
Pre-IPO Share Options and restricted shares \| Performance based option \| Earlier of the fourth anniversary
Share-based compensation.
Vesting Percentage				20.00%	20.00%

Share-based compensation - Share based compensation expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Share based compensation expense
Total share-based compensation expense	$ 2,121	$ 276
Research and development expenses
Share based compensation expense
Total share-based compensation expense	675	108
General and administrative expenses
Share based compensation expense
Total share-based compensation expense	$ 1,446	$ 168

Share-based compensation - Share options (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Additional Information
Total share-based compensation expense	$ 2,121	$ 276
Ordinary Shares
Number of Shares
Exercised	(1,071)	(3)
Stock option
Number of Shares
Outstanding number of shares at beginning	2,634,346
Granted	1,030,361
Exercised	(1,071)
Forfeited	(8,748)
Outstanding number of shares at end	3,654,888		2,634,346
Number of shares, vested and expected to vest	3,654,888
Number of shares, options exercisable	984,491
Weighted Average Exercise Price
Weighted average exercise price at beginning	$ 9.57
Granted	10.17
Exercised	1.47
Forfeited	8.67
Weighted average exercise price at ending	9.74		$ 9.57
Weighted average exercise price, vested and expected to vest	9.74
Weighted average exercise price, options exercisable	$ 7.71
Weighted Average Contractual Term
Weighted average contractual term, outstanding	9 years 2 months 1 day		9 years 15 days
Weighted average contractual term, vested and expected to vest	9 years 2 months 1 day
Weighted average contractual term ,options exercisable	8 years 9 months 15 days
Aggregate Intrinsic Value
Aggregate intrinsic value outstanding	$ 14,973		$ 2,868
Granted	$ 6.68	$ 3.68
Aggregate intrinsic value, vested and expected to vest	$ 14,973
Aggregate intrinsic value, options exercisable	$ 5,993
Additional Information
Granted	$ 6.68	$ 3.68
Total share-based compensation expense	$ 2,100	$ 200

Share-based compensation - Assumptions used in the Black Scholes option pricing model to determine the fair value of share options (Details) - Stock option - Employees and directors - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Share-based compensation.
Risk-free interest rate	1.60%	2.70%
Expected volatility	73.70%	79.60%
Expected term (in years)	5 years 11 months 12 days	6 years 26 days
Unrecognized compensation expense
Total unrecognized compensation expense related to the unvested employee and director	$ 15.3
Unrecognized compensation cost expected to be recognized over a weighted average period	2 years 10 months 24 days

Share-based compensation - Restricted shares (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2020
Restricted shares
Total share-based compensation expense	$ 2,121	$ 276
Restricted ordinary shares
Number of shares
Unvested restricted ordinary shares at beginning	0
Unvested restricted ordinary shares at ending	0
Restricted shares
Unvested restricted ordinary shares	0		0
Total share-based compensation expense	$ 0	100
Restricted ordinary shares \| Employees and directors
Restricted shares
Unrecognized compensation cost			$ 0
Restricted ordinary shares \| Employee
Restricted shares
Fair value of employee restricted share awards vested	$ 0	$ 100

Significant agreements - Collaboration revenues (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Significant agreements.
Collaboration revenues	$ 1,129	$ 6,384
AstraZeneca
Significant agreements.
Collaboration revenues	412	425
Sanofi
Significant agreements.
Collaboration revenues	0	5,959
Dementia Discovery Fund
Significant agreements.
Collaboration revenues	56	0
Genetech
Significant agreements.
Collaboration revenues	$ 661	$ 0

Significant agreements - AstraZeneca Collaboration Agreement (Details)	1 Months Ended				3 Months Ended
	May 31, 2019 employee	May 31, 2018 USD ($)	Aug. 31, 2017	Nov. 30, 2016 USD ($) employee item	Mar. 31, 2020 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2019 USD ($)	Jul. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Oct. 31, 2017 USD ($)
Significant agreements.
Collaboration revenues					$ 1,129,000	$ 6,384,000
Deferred revenue					34,253,000		$ 5,657,000		$ 14,635,000
AstraZeneca
Significant agreements.
Biological Targets \| item				6
Term (in years)			3 years
Term, Bicycle Research Team (in years)				1 year
Term, AZ Research (in years)				2 years
Number of FTE \| employee				2
Collaboration revenues					412,000	425,000
Deferred revenue					4,658,000		4,913,000		$ 4,727,000
AstraZeneca \| Development milestone
Significant agreements.
Transaction price		$ 700,000
AstraZeneca \| Target One
Significant agreements.
Transaction price										$ 2,000,000
AstraZeneca \| Target Two
Significant agreements.
Transaction price				$ 600,000
AstraZeneca \| Target Three Research License and Related Services
Significant agreements.
Collaboration revenues					400,000	300,000
AstraZeneca \| Commercialization license per candidate
Significant agreements.
Customer option payment				8,000,000
AstraZeneca \| Development Milestone \| Development milestone
Significant agreements.
Customer option payment				29,000,000
AstraZeneca \| Regulatory Milestone \| Regulatory milestone
Significant agreements.
Customer option payment				23,000,000
AstraZeneca \| Commercial milestone \| Commercial milestone
Significant agreements.
Customer option payment				$ 110,000,000
AstraZeneca \| Minimum
Significant agreements.
Term extension (in years)				12 months
AstraZeneca \| Maximum
Significant agreements.
Term extension (in years)				15 months
AstraZeneca \| 2016 Collaboration Agreement
Significant agreements.
Biological Targets \| item				2
Option fee for development and exploitation rights				$ 8,000,000
Transaction price				$ 1,200,000
Deferred revenue					0		$ 0
AstraZeneca \| 2016 Collaboration Agreement \| Target One and Target Two Research License and Related Services
Significant agreements.
Collaboration revenues					0	100,000
AstraZeneca \| May 2018 Option Exercise
Significant agreements.
Biological Targets \| item				4
Option fee for development and exploitation rights		5,000,000		$ 5,000,000
Number of FTE \| employee	2
Customer option payment		$ 8,000,000
Transaction price					5,650,000			$ 6,300,000
Deferred revenue					4,700,000	$ 4,900,000
AstraZeneca \| May 2018 Option Exercise \| Target Three Research License and Related Services
Significant agreements.
Transaction price					650,000
AstraZeneca \| May 2018 Option Exercise \| Target 3 Material Right
Significant agreements.
Transaction price					1,504,000
AstraZeneca \| May 2018 Option Exercise \| Target 4 Material Right
Significant agreements.
Transaction price					1,204,000
AstraZeneca \| May 2018 Option Exercise \| Target 5 Material Right
Significant agreements.
Transaction price					1,165,000
AstraZeneca \| May 2018 Option Exercise \| Target 6 Material Right
Significant agreements.
Transaction price					$ 1,127,000

Significant agreements - Sanofi Collaboration Agreement (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	Aug. 31, 2017	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Dec. 31, 2018
Significant agreements.
Revenue recognized by non exercising of option		$ 0	$ 5,340
Revenue from collaborative arrangement		1,129	6,384
Deferred revenue		34,253		$ 5,657	$ 14,635
Development milestone
Significant agreements.
Non refundable payment for services during the BV Bicycle Research Term		4,200
Sanofi
Significant agreements.
Total transaction price initially determined	$ 14,200			14,900
Upfront cash payment	10,000
Non refundable payment for services during the BV Bicycle Research Term	4,200
Revenue from collaborative arrangement		0	5,959
Deferred revenue		$ 0		$ 0	$ 9,908
Sanofi \| Sickle Cell Research License and Related Services
Significant agreements.
Total transaction price initially determined	1,405
Sanofi \| Hemophilia Research License and Related Services
Significant agreements.
Total transaction price initially determined	2,811
Sanofi \| Sickle Cell License Option Material Right
Significant agreements.
Total transaction price initially determined	5,286
Revenue recognized by non exercising of option			$ 5,300
Sanofi \| Hemophilia License Option Material Right
Significant agreements.
Total transaction price initially determined	$ 4,698

Significant agreements - Oxurion Collaboration Agreement (Details) $ in Thousands, € in Millions	3 Months Ended
	Mar. 31, 2020 EUR (€)	Mar. 31, 2020 USD ($)	Mar. 31, 2019 USD ($)	Mar. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
Significant agreements.
Revenue from collaborative arrangement \| $		$ 1,129	$ 6,384
Deferred revenue \| $				$ 34,253	$ 5,657	$ 14,635
Oxurion
Significant agreements.
Threshold period of notice required for termination of agreement	90 days	90 days
Revenue from collaborative arrangement \| $		$ 0	$ 0
Deferred revenue \| $				$ 0
Oxurion \| Development milestone
Significant agreements.
Upfront cash payment \| €	€ 1.0
Potential milestone payments \| €	8.3
Revenue under contracts with customer from milestone payment \| €	1.8
Oxurion \| Regulatory milestone
Significant agreements.
Potential milestone payments \| €	€ 16.5

Significant agreements - Dementia Discovery Fund Agreement (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	May 31, 2019	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Dec. 31, 2018
Significant agreements.
Collaboration revenues		$ 1,129	$ 6,384
Deferred revenue		34,253		$ 5,657	$ 14,635
Dementia Discovery Fund
Significant agreements.
Upfront cash payment	$ 1,100
Potential milestone payments	$ 700
Threshold period for exercising option to establish a jointly-owned new company	90 days
Option to purchase ownership of new entity	34.00%
Threshold period of notice required for termination of agreement	60 days
Transaction price	$ 1,100
Collaboration revenues		56	$ 0
Deferred revenue		$ 640		$ 744
Dementia Discovery Fund \| NewCo
Significant agreements.
Option to purchase ownership of new entity	66.00%
Threshold period in which Newco shall have the right to initiate a new research program	2 years
Dementia Discovery Fund \| NewCo \| Maximum
Significant agreements.
Total voting rights related to ownership interests	50.00%

Significant agreements - Genetech Collaboration Agreement (Details) $ in Thousands		3 Months Ended
	Feb. 21, 2020 USD ($) item	Mar. 31, 2020 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
Significant agreements.
Collaboration revenues		$ 1,129	$ 6,384
Deferred revenue		34,253		$ 5,657	$ 14,635
Genetech
Significant agreements.
Number of Potential development candidates \| item	4
Upfront cash payment	$ 30,000
Number of immuno oncology targets \| item	2
Expansion Fee	$ 10,000
Number of collaboration programs \| item	2
Transaction price	$ 31,000
Collaboration revenues		661	$ 0
Deferred revenue		$ 28,955
Period over which performance obligations will be performed		2 years
Material rights exercise period		4 years
Genetech \| Royalty
Significant agreements.
Number of years over which royalty is payable		10 years
Genetech \| Maximum
Significant agreements.
Additional number of immuno oncology targets \| item	2
Regulatory, and initial commercialization milestones, payments receivable	$ 200,000
Genetech \| Development milestone \| Maximum
Significant agreements.
Sales milestone payments, receivable	65,000
Genetech \| Regulatory milestone \| Maximum
Significant agreements.
Sales milestone payments, receivable	135,000
Genetech \| Collaboration Program 1 Performance Obligation
Significant agreements.
Transaction price	3,775
Genetech \| Collaboration Program 2 Performance Obligation
Significant agreements.
Regulatory, and initial commercialization milestones, payments receivable	8,000,000,000
Transaction price	$ 7,550
Genetech \| Specified Targeting Arm Material Right Arm Program One
Significant agreements.
Number of initial collaboration programs exercised \| item	1
Sales milestone payments, receivable	$ 1,000
Transaction price	330
Genetech \| Two material rights associated with the LSR Go Option for Collaboration Programs One And Two
Significant agreements.
Transaction price	11,650
Genetech \| Material rights for associated and limited substitution rights
Significant agreements.
Transaction price	$ 1,115
Genetech \| Two material rights for Expansion Options or Dev Go Option
Significant agreements.
Number of expansion option collaboration programs \| item	2
Transaction price	$ 6,580
Genetech \| Collaboration Program One and Two Performance Obligation \| Maximum
Significant agreements.
Sales milestone payments, receivable	$ 200,000
Genetech \| Material rights
Significant agreements.
Deferred revenue		$ 19,700

Significant agreements - Summary of Contract Assets and Liabilities (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2020	Dec. 31, 2019
Contract assets
Balance at the beginning of year	$ 0	$ 0
Additions		149
Deductions		(149)
Impact of exchange rates		0
Balance at the end of year		0
Contract liabilities:
Balance at the beginning of year	5,657	14,635
Additions	31,000	1,172
Deductions	(1,129)	(10,413)
Impact of exchange rates	(1,275)	263
Balance at the end of year	34,253	5,657
AstraZeneca
Contract liabilities:
Balance at the beginning of year	4,913	4,727
Additions		58
Deductions	(412)	(35)
Impact of exchange rates	157	163
Balance at the end of year	4,658	4,913
Sanofi
Contract liabilities:
Balance at the beginning of year	0	9,908
Additions		0
Deductions		(9,984)
Impact of exchange rates		76
Balance at the end of year	0	0
Dementia Discovery Fund
Contract assets
Balance at the beginning of year	744	0
Additions		1,114
Deductions		(394)
Impact of exchange rates		24
Balance at the end of year		744
Contract liabilities:
Balance at the beginning of year	744
Deductions	(56)
Impact of exchange rates	(48)
Balance at the end of year	640	$ 744
Genetech
Contract liabilities:
Additions	31,000
Deductions	(661)
Impact of exchange rates	(1,384)
Balance at the end of year	$ 28,955

Significant agreements - Deferred revenue (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Deferred revenue
Deferred revenue	$ 34,253	$ 5,657	$ 14,635
AstraZeneca
Deferred revenue
Deferred revenue	4,658	$ 4,913	$ 4,727
AstraZeneca \| Target 3, Target 4, Target 5 and Target 6 Material Rights
Deferred revenue
Deferred revenue	$ 4,700

Significant agreements - Revenue recognition due to changes in contract assets and liabilities (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Significant Agreements
Revenue recognized based on proportional performance	$ (1,129)	$ (1,044)
Revenue recognized based on expiration of material rights	0	(5,340)
Total	$ (1,129)	$ (6,384)

Significant agreements - Cancer Research UK (Details) - USD ($) $ in Millions		1 Months Ended	12 Months Ended
	Dec. 13, 2016	Dec. 31, 2019	Dec. 31, 2016	Mar. 31, 2020	Mar. 31, 2019
Research and development arrangement obligation to repay other parties
Contingent future milestones payments under research and development arrangement	$ 50.9	$ 60.3
Other long term liabilities
Research and development arrangement obligation to repay other parties
Liability from research and development				$ 2.0	$ 2.0
Commercialization license per candidate
Research and development arrangement obligation to repay other parties
Refunding the costs and expenses incurred in case of termination (as a percent)	50.00%
BT1718 \| Minimum
Research and development arrangement obligation to repay other parties
Tiered royalties (percentage)			70.00%
BT1718 \| Maximum
Research and development arrangement obligation to repay other parties
Tiered royalties (percentage)			90.00%
BT7401 \| Minimum
Research and development arrangement obligation to repay other parties
Tiered royalties (percentage)		55.00%
BT7401 \| Maximum
Research and development arrangement obligation to repay other parties
Tiered royalties (percentage)		80.00%

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Income Taxes
Benefit from income taxes	$ 107	$ (80)

Commitments and Contingencies - Leases, Office and laboratory space in Cambridge and Lexington, Massachusetts (Details) - Office and laboratory space in Lexington, Massachusetts $ in Millions	1 Months Ended
	Sep. 30, 2017 USD ($)
Leases
Security deposit	$ 0.2
Payment under the lease	$ 0.1
Discounted percentage for present value of lease payments	9.00%

Commitments and Contingencies - Leases, Office and laboratory space in Building 900, Babraham Research Campus, Cambridge (Details) - Office and laboratory space in Building 900, Babraham Research Campus, Cambridge $ in Millions	Oct. 31, 2017 USD ($)
Leases
Annual rent	$ 0.5
Renewal term	5 years
Estimated service charges payable	$ 0.1
Security deposit	$ 0.6
Discounted percentage for present value of lease payments	7.75%

Commitments and Contingencies - Leases, Components of lease expense (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($)
Commitments and Contingencies
Operating lease cost	$ 223
Variable lease cost	139
Total lease cost	$ 362
Weighted-average remaining operating lease term (years)	2 years 4 months 24 days
Weighted-average discount rate	8.56%

Commitments and Contingencies - Leases, Maturities of operating leases (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Dec. 31, 2019
Commitments and Contingencies
2020	$ 743
2021	751
2022	443
Present value adjustment	(245)
Total lease liabilities	1,692
Less: current lease liabilities	(636)	$ (640)
Long term lease liabilities	$ 1,056	$ 1,251
Maximum days allowed for cancellation of contracts prior written notice	90 days

Commitments and Contingencies - Founder Royalty arrangements (Details) - Founders and initial investors - Royalty Agreements $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($)
Founder Royalty arrangements
Period of royalty payments agreed under arrangement	10 years
Royalties paid	$ 0

Net loss per share - Basic and diluted net loss per share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Numerator:
Net loss attributable to ordinary shareholders	$ (11,324)	$ (6,503)
Denominator:
Weighted average ordinary shares outstanding, basic and diluted	17,997,929	834,043
Net loss per share attributable to ordinary shareholders, basic and diluted	$ (0.63)	$ (7.80)

Net loss per share per share - Securities excluded from the diluted per share calculation (Details) - shares		3 Months Ended
	Mar. 07, 2019	Mar. 31, 2020	Mar. 31, 2019	May 28, 2019
Antidilutive securities
Antidilutive securities (in shares)		3,726,338	13,982,986
Remaining warrants exercisable		50,000		80,000
Convertible preferred shares (as converted to ordinary shares)
Antidilutive securities
Antidilutive securities (in shares)			11,647,529
Warrants to subscribe for convertible preferred shares (as adjusted to reflect the impact of the share capital reorganization and issuance of bonus shares
Antidilutive securities
Antidilutive securities (in shares)		71,450	1,347,953
Percentage of warrants exercise in conjunction with IPO	50.00%
Percentage of warrants expire	50.00%
Number of ordinary shares for warrants exercise		71,450
Restricted ordinary shares
Antidilutive securities
Antidilutive securities (in shares)			56,643
Options to purchase ordinary shares
Antidilutive securities
Antidilutive securities (in shares)		3,654,888	930,861

Benefit plans (Details) - USD ($) $ in Millions	3 Months Ended
Benefit plans (Details) - USD ($) $ in Millions	Mar. 31, 2020	Mar. 31, 2019
United States \| 401(k) Plan
Benefit plans
Contributions made	$ 0.1	$ 0.1
Foreign Plan \| U.K. Plan
Benefit plans
Contributions made	$ 0.1	$ 0.1

Related party transactions (Details) - Chairman of Board of Directors - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Consultancy services with 10X Capital Inc.
Related party transactions
Amount of transaction	$ 0	$ 50,000
Consultancy services with Stone Sunny Isles Inc.
Related party transactions
Amount of transaction	$ 40,000	$ 0

Geographic information (Details) $ in Thousands	3 Months Ended
Geographic information (Details) $ in Thousands	Mar. 31, 2020 USD ($) segment	Dec. 31, 2019 USD ($)
Geographic information
Number of geographic regions \| segment	2
Long lived assets, including operating lease right of use assets	$ 4,018	$ 4,348
United States
Geographic information
Long lived assets, including operating lease right of use assets	1,971	2,017
United Kingdom
Geographic information
Long lived assets, including operating lease right of use assets	$ 2,047	$ 2,331