DEF 14A of aTYR Pharma Inc, Apr 5, 2024

DEF 14A of aTYR Pharma Inc

Filed Apr 5, 2024 · FY20230000950170-24-042236

Open on EDGAR

  1. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS

  2. General

    General Our Restated Certificate of Incorporation provides for a board of directors that is divided into three classes, each with a staggered, three-year term. The term of the Class III directors will expire at the Annual Meeting, and each of our Class III directors will stand for re-election at the Annual Meeting. Our Board of Directors is currently comprised of seven members. If the Class III director nominees are re-elected at the Annual Meeting, the composition of our Board of Directors will be as follows: Class I— Mr. John K. Clarke, Dr. Paul Schimmel and Dr. Sara L. Zaknoen; Class II— Mr. Timothy P. Coughlin and Dr. Jane A. Gross; and Class III— Dr. Svetlana Lucas and Dr. Sanjay S. Shukla. In the absence of instructions to the contrary, the persons named as proxy holders in the accompanying proxy intend to vote in favor of the election of the Class III director nominees designated below to serve until the 2027 annual meeting of stockholders and until their successors shall have been duly elected and qualified. Each nominee is currently a director. Our Board of Directors expects that each nominee will be available to serve as a director, but if any such nominee should become unavailable or unwilling to stand for election, it is intended that the shares represented by the proxy will be voted for such substitute nominee as may be designated by the Board of Directors. The biographies of our directors and their ages as of March 1, 2024 are set forth below.

  3. General

    | Name | Age | Position | | Sanjay S. Shukla, M.D., M.S. | 52 | President, Chief Executive Officer and Director | | Timothy P. Coughlin (1)(2) | 57 | Chairman of the Board | | John K. Clarke (1)(3) | 70 | Director | | Jane A. Gross, Ph.D. (2) | 67 | Director | | Svetlana Lucas, Ph.D. (1)(3) | 52 | Director | | Paul Schimmel, Ph.D. | 83 | Director | | Sara L. Zaknoen, M.D. (2)(3) | 65 | Director |

  4. General

    (1) Member of the Audit Committee. (2) Member of the Compensation Committee. (3) Member of the Nominating and Corporate Governance Committee.

  5. Nominees for Director

    Nominees for Director Class III: The two individuals listed below are nominated for election as Class III directors to serve a three-year term expiring at the 2027 annual meeting of stockholders and until their respective successors are elected and qualified. Dr. Lucas and Dr. Shukla were previously elected by the stockholders. Svetlana Lucas, Ph.D. has served as a director since June 2019. Dr. Lucas currently serves as Chief Business Officer at Scribe Therapeutics, a private biotechnology company. Prior to her current role, she served as Senior Vice President, Business Development at Tizona Therapeutics, Inc. (“Tizona”), a clinical stage immunotherapy company, where she was responsible for the company’s business development strategy and transactions, including a global strategic collaboration with AbbVie Inc. (“AbbVie”). Before joining Tizona, Dr. Lucas was Head of Oncology and Inflammation External R&D at Amgen Inc. (“Amgen”), where she oversaw business development activities, including Amgen’s strategic cancer immunotherapy research collaboration and licensing agreement with Kite Pharma, and collaborated with Amgen Ventures on several investments in oncology and inflammation. Dr. Lucas joined Amgen following the acquisition of Onyx Pharmaceuticals, Inc. (“Onyx”), where she spearheaded the company’s oncology partnering strategy and due diligence of new opportunities. Prior to Onyx, she held positions of increasing responsibility in strategy, business development and strategic marketing at Amgen, PDL BioPharma/Facet Biotech (acquired by AbbVie), and XOMA Corporation. She began her career as a strategy consultant in the Life Sciences practice of McKinsey & Company, Inc. Dr. Lucas received her Ph.D. in Molecular Biology and Biochemistry from California Institute of Technology, and an undergraduate degree in Biology from Moscow State University. Our Board of Directors believes that Dr. Lucas is qualified to serve on our Board of Directors due to her extensive business development experience in the biotherapeutics industry. Sanjay S. Shukla, M.D., M.S. has served as our President and Chief Executive Officer and as a director since November 2017. Dr. Shukla served as our Chief Medical Officer from March 2016 to November 2017. From April 2015 to March 2016, Dr. Shukla worked in an advisory capacity for a number of companies, including as a consultant to our company from January 2016 to March 2016. Prior to that, from October 2012 to April 2015, Dr. Shukla served as Vice President and Global Head of Integrated Medical Services for Novartis, a biopharmaceutical company, where he led global medical affairs operations, with oversight for all pharma general medicines therapies, both inline and in development. Dr. Shukla served as Chief Executive Officer of RXMD, a clinical development consultancy that assisted in advancing proof of concept for early stage drug candidates, from April 2009 to September 2012. Prior to that, Dr. Shukla served in a variety of clinical development, data analytics and drug safety roles at Vifor Pharma, a biopharmaceutical company, and Aspreva Pharmaceuticals (acquired by Vifor Pharma). Dr. Shukla received his M.D. from Howard University College of Medicine and his Bachelors of Science in microbiology and Master of Science in epidemiology and biostatistics from the University of Maryland. Our Board of Directors believes that Dr. Shukla is qualified to serve on our Board of Directors due to his experience as our Chief Executive Officer and previously as our Chief Medical Officer, as well as his medical background, experience in the life science industry and his leadership experience. Continuing Directors:

  6. Class I: Currently Serving Until the 2025 Annual Meeting

    Class I: Currently Serving Until the 2025 Annual Meeting John K. Clarke has served as a director since September 2005, and served as Chairman of our Board of Directors from September 2005 to March 2024. Mr. Clarke is Managing Partner of Cardinal Partners, a venture capital firm focused on healthcare investing. He co-founded Cardinal Partners in 1997 and has served as President of CHP Management, Inc. since that time. He has also served as a director for several biotechnology and biopharmaceutical companies including Alnylam Pharmaceuticals, Inc., Momenta Pharmaceuticals, Inc., Verastem, Inc., Vividion Therapeutics, Inc. (acquired by Bayer AG) and Sirtris Pharmaceuticals, Inc. (acquired by GlaxoSmithKline); healthcare information technology companies, including TechRx Technology Services Corporation (acquired by NDCHealth) and Visicu, Inc. (acquired by Phillips Electronics); and a privately held biopharmaceutical company, Rib-X Pharmaceuticals Inc. Mr. Clarke holds an A.B. in economics and biology from Harvard University and an M.B.A. from the Wharton School at the University of Pennsylvania. Our Board of Directors believes Mr. Clarke is qualified to serve on our Board of Directors due to his extensive experience within the field of drug discovery and development and his broad leadership experience on various public and private company boards. Paul Schimmel, Ph.D. has served as a director since September 2005. Dr. Schimmel is currently a director of several private companies. He was a cofounder of Repligen Corporation, Alkermes, Inc., Cubist Pharmaceuticals, Sirtris Pharmaceuticals, and Alnylam Pharmaceuticals, Inc., and a founding Director of Momenta, Inc. Dr. Schimmel is a Professor of Molecular Medicine and of Chemistry at Scripps Research. He was formerly the John D. and Catherine T. MacArthur Professor of Biochemistry and Biophysics in the Department of Biology at the Massachusetts Institute of Technology. Dr. Schimmel holds a B.A. from Ohio Wesleyan University and a Ph.D. in biochemistry and biophysics from the Massachusetts Institute of Technology. He is an elected member of the National Academy of Sciences, the National Academy of Medicine, the National Academy of Inventors, the American Philosophical Society and the American Academy of Arts and Sciences. Our Board of Directors believes Dr. Schimmel is qualified to serve on our Board of Directors due to his role as one of our scientific founders and his discoveries and scientific leadership in the field of tRNA synthetase biology and other areas important to the development of therapeutics. Sara L. Zaknoen, M.D. has served as a director since May 2021. Since June 2014, through her company, Zed Strategic Consulting, Dr. Zaknoen has worked as a clinical drug development consultant with large pharmaceutical and biotechnology companies across multiple disease indications. Previously, Dr. Zaknoen held Chief Medical Officer positions at several biotechnology companies, including Ignyta, Inc., Polynoma LLC, Tragara Pharmaceuticals, Inc. and Cabrellis Pharmaceuticals Corporation. Prior to that, Dr. Zaknoen served as Executive Director of Phase 2/3 Clinical Oncology Research at Novartis Pharmaceutical Corporation, where she provided oversight for a number of important marketed therapies, such as Gleevec®, Tasigna® and Exiade®. This included supervising the execution of clinical studies, including registrational trials, and involvement with new drug applications and label expansion activities. As Director of Clinical Oncology Research at Schering-Plough (now Merck) she was the lead physician on the Temodar® program, supporting its approval and launch. Additional professional experience includes: Assistant Professor of Medicine at the University of Cincinnati Medical Center; Director of Experimental Therapeutics at the Western Pennsylvania Hospital, Western Pennsylvania Cancer Institute; and Medical Staff Fellow at the National Cancer Institute. Dr. Zaknoen completed her residency, internship and fellowship in hematology/oncology at the University of Minnesota. She received her M.D. from Indiana University School of Medicine and her B.S. in chemistry and biology from Valparaiso University. Our Board of Directors believes that Dr. Zaknoen is qualified to serve on our Board of Directors due to her extensive experience in clinical research, her medical background and her experience in the biotherapeutics industry.

  7. Class II: Currently Serving Until the 2026 Annual Meeting

    Class II: Currently Serving Until the 2026 Annual Meeting Timothy P. Coughlin has served as a director since April 2017, and as Chairman of our Board of Directors since March 2024. Mr. Coughlin is the former Chief Financial Officer of Neurocrine Biosciences, Inc. (“Neurocrine”), a biopharmaceutical company that has received U.S. Food and Drug Administration approval for INGREZZA (valbenazine) and ORILISSA (elagolix), both of which were discovered and developed during his tenure at Neurocrine from 2002 to 2018. Prior to joining Neurocrine, he was with Catholic Health Initiatives, a nationwide integrated healthcare delivery system, where he served as Vice President, Financial Services. Mr. Coughlin also served as a Senior Manager in the Health Sciences practice of Ernst & Young LLP and its predecessors from 1989 to 1999. Mr. Coughlin serves on the board of directors of Travere Therapeutics, Inc. and Fate Therapeutics, Inc., both biotechnology companies. He also served on the board of directors of Peloton Therapeutics prior to its sale to Merck & Co in 2019. Mr. Coughlin holds a master’s degree in international business from San Diego State University and a bachelor’s degree in accounting from Temple University. Mr. Coughlin is a certified public accountant in both California and Pennsylvania. Our Board of Directors believes that Mr. Coughlin is qualified to serve on our Board of Directors due to his extensive background in financial and accounting matters for public companies, his experience overseeing information technology functions, his experience in the life science industry and his years of business and leadership experience. Jane A. Gross, Ph.D. has served as a director since June 2019. Dr. Gross served as the Chief Scientific Officer and Senior Vice President of Research and Development at Aptevo Therapeutics Inc. (“Aptevo”) from September 2016 to September 2021. She currently serves as a consultant to, and on the scientific advisory boards of several biotechnology companies developing drugs for autoimmune, inflammatory and oncology therapeutics. At Aptevo, Dr. Gross led the discovery of novel protein therapeutics based on the ADAPTIR™ and ADAPTIR-FLEX™ platform technologies focusing on development of therapeutics based on immuno-oncology, leading research efforts in molecular biology and protein engineering, immunology, protein and cell sciences, pharmacology, and translational research. Prior to joining Aptevo, Dr. Gross served as Vice President, Applied Research and Non-Clinical Development at Emergent BioSolutions Inc. and Vice President, Immunology Research at ZymoGenetics, Inc., where she led efforts in discovery and development of therapeutics from novel genes. Dr. Gross serves on the board of directors of BriaCell Therapeutics Corp., a biotechnology company. Dr. Gross holds a Ph.D. in Immunology from the University of California, Berkeley under Jim Allison (2018 recipient of the Nobel Prize in Physiology and Medicine) and a Post-Doctoral Fellowship from the University of Washington in Immunology. Our Board of Directors believes that Dr. Gross is qualified to serve on our Board of Directors due to her extensive experience in the biotherapeutics industry and her expertise in immunology and oncology.

  8. Executive Summary

    Enhanced sustainability through meeting financial and operational objectives. We ended 2023 with $101.7 million in cash, cash equivalents, restricted cash and available-for-sale investments. In February 2023, we completed an underwritten follow-on public offering of 23,125,000 shares of our common stock, including the partial exercise of the underwriters’ option to purchase additional shares, at a price to the public of $2.25 per share. The total net proceeds from the offering were approximately $48.1 million, after deducting underwriting discounts, commissions and offering expenses payable by us. In April 2022, we entered into an Open Market Sale AgreementSM with Jefferies implementing an “at-the-market” offering program (the “ATM Offering Program”), pursuant to which we may offer and sell, from time to time and at our option, up to an aggregate of $65.0 million of shares of our common stock through Jefferies, acting as sales agent. Jefferies is entitled to a fixed commission rate of up to 3.0% of the gross sales proceeds of shares sold under the ATM Offering Program. During 2023, we sold an aggregate of 10,530,735 shares of common stock at a weighted-average price of $1.82 per share for net proceeds of approximately $18.4 million under the ATM Offering Program. 2023 Compensation Actions We structured a significant proportion of target compensation for our Named Executive Officers as variable or at-risk pay, consisting of annual performance bonus and equity awards in the form of stock options. “Target compensation” consists of base salary, target performance bonus opportunity and equity awards granted in 2023. • Based on 2023 performance, the Compensation Committee and the Board of Directors determined that performance-based bonuses should be paid at 70% of target to our Named Executive Officers. • In February 2023, we granted equity awards in the form of stock options to our Named Executive Officers to incentivize and reward for stockholder value creation as part of our annual performance evaluation. • We adopted our Incentive Compensation Recoupment Policy (“Clawback Policy”) to allow the Company to potentially recover incentive compensation from our executive officers in the event a financial restatement is required to correct any accounting errors. Executive Compensation Practices Our Compensation Committee conducts oversight of our compensation program and policies. Our executive compensation philosophy is based on the following objectives: • Aligning executive interests and stockholder interests through long-term incentives linked to Company performance; • Attracting, retaining and motivating superior executive talent who exemplify and enhance the Company culture; and • Providing incentives that reward the achievement of performance goals that directly correlate to the enhancement of stockholder value, as well as to facilitate executive retention. Our executive compensation program generally consists of the following three principal components: base salary, annual performance-based bonuses and long-term incentive compensation. We also provide our executive officers with severance and change-in-control payments and benefits, as well as other benefits generally available to all our employees, including retirement benefits under our tax-qualified retirement plan (“401(k) Plan”) and participation in employee benefit plans. In evaluating our executive compensation program and policies, as well as the short- and long-term value of our executive compensation plans and arrangements, the Compensation Committee focuses on providing a competitive compensation package that provides significant short- and long-term incentives for the achievement of measurable corporate objectives and individual contribution towards our corporate performance. We believe that this approach provides an appropriate blend of short- and long-term incentives to maximize stockholder value. We do not currently have formal policies for allocating compensation among base salary, annual performance bonuses and equity awards, short- and long-term compensation or among cash and non-cash compensation. Instead, the Compensation Committee uses its judgment to establish a target total direct compensation opportunity for executive officers that is a mix of current, short- and long-term incentive compensation, and cash and non-cash compensation, that it believes appropriate to achieve the goals of our executive compensation program and our corporate objectives. A significant portion of our Named Executive Officers’ target total direct compensation opportunity is comprised of “at-risk” compensation in the form of an annual performance bonus opportunity and equity awards, in order to align the executive officers’ incentives with the interests of our stockholders and our corporate goals. Oversight of Executive Compensation The Compensation Committee reviews and makes decisions with respect to all compensation paid to our executive officers, including our Named Executive Officers, except for the Chief Executive Officer. With respect to the Chief Executive Officer, the Compensation Committee recommends, and the Board of Directors determines, his compensation. The Chief Executive Officer evaluates and provides to the Compensation Committee performance assessments and compensation recommendations for the Named Executive Officers. In making these recommendations, the Chief Executive Officer reviews third-party compensation surveys and any compensation data provided by the independent compensation consultant to the Compensation Committee, as described below. While the Chief Executive Officer discusses these recommendations with the Compensation Committee and the Board, he does not participate in the deliberations concerning, or the determination of, his own compensation. The Compensation Committee makes a recommendation to the Board and the Board discusses and makes final determinations with respect to executive compensation matters without the Chief Executive Officer present during discussions of the Chief Executive Officer’s compensation. From time to time, various other members of management and other employees as well as outside advisors or consultants may be invited by the Compensation Committee or the Board to make presentations, provide financial or other background information or advice or otherwise participate in the Compensation Committee or Board meetings. The Compensation Committee meets periodically throughout the year to manage and evaluate our executive compensation program and determines the principal components of compensation (base salary, performance bonus and equity awards) for our executive officers on an annual basis; however, decisions may occur during the year for new hires, promotions or other special circumstances as the Compensation Committee determines appropriate. Neither the Board nor the Compensation Committee delegates authority to approve executive officer compensation except as described herein. The Compensation Committee does not maintain a formal policy regarding the timing of equity awards to our executive officers.

  9. Executive Summary

    The Compensation Committee has sole authority over compensation consultants it retains to assist in its evaluation of executive compensation, including the authority to approve the consultant’s reasonable fees and other retention terms. In 2022, the Compensation Committee directly engaged and retained Radford, which is part of the Rewards Solutions practice at Aon plc, to provide a competitive assessment of the Company’s executive compensation program compared to executive compensation paid to executives at selected publicly traded peer companies and to provide the Compensation Committee with advice regarding executive officers’ compensation, including base salaries, performance-based bonuses and long-term equity compensation for 2022 executive officer compensation. Radford’s work on our peer group analysis in late 2022 was used as the basis for the Compensation Committee’s decisions on 2023 executive officer compensation, along with evaluation of data from Radford's compensation database. The compensation consultant reports directly to the Compensation Committee, which maintains the authority to direct its work and engagement. The compensation consultant interacts with management to gain access to company information that is required to perform its services and to understand the culture and policies of our organization. The Compensation Committee considered Radford’s independence, taking into account the following factors: (i) the amount of fees paid to Radford, as a percentage of the firm’s total revenue; (ii) the provision of other services to us by Radford; (iii) Radford’s policies and procedures designed to prevent conflicts of interest; (iv) any business or personal relationship of Radford with any member of the Compensation Committee; (v) any business or personal relationship of Radford or the individual compensation advisors employed by Radford with any of our executive officers or any members of the Compensation Committee; and (vi) any shares of our common stock owned by Radford or the individual compensation advisors employed by Radford. The Compensation Committee’s general aim is for compensation to remain competitive with the market. We have not developed a specific market positioning or “benchmark” that we consistently aim for in setting compensation levels; instead the Compensation Committee determines each element of compensation, and total target cash and direct compensation, for our executive officers based on various facts and circumstances appropriate for our company in any given year. Competitive market positioning is only one of several factors, as described below under “Factors Used in Determining Executive Compensation,” that the Compensation Committee considers in making compensation recommendations and decisions, and therefore individual executive officer compensation may fall at varying levels as compared to the market data. Use of Competitive Market Compensation Data The peer group for 2023 targeted U.S.-based, publicly traded, pre-commercial companies operating in the biopharmaceutical industry, with development programs primarily in Phase II or III clinical trials with emphasis on pulmonology, respiratory, and infectious disease where possible, market capitalizations generally between 0.5 and 5.0 times our market capitalization, headcount generally under 150 employees, and with a particular focus on companies headquartered in biotechnology hub markets. When designing our executive compensation program for 2023, the Compensation Committee reviewed market data for each executive officer’s position from the following peer group of companies for 2023:

  10. SUMMARY COMPENSATION TABLE

    SUMMARY COMPENSATION TABLE The following table presents all of the compensation earned by or paid to our Named Executive Officers during the fiscal years ending December 31, 2023 and 2022.

  11. SUMMARY COMPENSATION TABLE

    | Name and Principal Position | Year | Salary ($) | Stocks Awards ($)(1) | Option Awards ($)(1) | Nonequity Incentive Plan Compensation ($)(2) | All Other Compensation ($)(3) | Total ($) | | Sanjay S. Shukla, M.D., M.S. | 2023 | 561,243 | — | 532,341 | 196,435 | 10,506 | 1,300,525 | | President and CEO | 2022 | 561,243 | 229,080 | 1,386,876 | 224,500 | 9,736 | 2,411,435 | | Jill M. Broadfoot | 2023 | 414,395 | — | 133,084 | 116,031 | 14,327 | 677,837 | | Chief Financial Officer | 2022 | 414,395 | 82,800 | 274,076 | 132,610 | 9,612 | 913,493 | | Nancy E. Denyes | 2023 | 396,635 | — | 133,084 | 111,058 | 10,506 | 651,283 | | General Counsel | 2022 | 396,635 | 59,340 | 266,053 | 126,925 | 8,575 | 857,528 |

  12. SUMMARY COMPENSATION TABLE

    (1) Amounts shown reflect aggregate full grant date fair value of equity-based awards granted during the year in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“FASB ASC Topic 718”). For additional information on the valuation assumptions underlying the value of these equity awards, see Part II, Item 8 “Financial Statements and Supplementary Date” of our Annual Report in the Notes to Consolidated Financial Statements, Note 7, “Stockholders’ Equity”. These amounts do not necessarily correspond to the actual value recognized or that may be recognized by the Named Executive Officers. Our Named Executive Officers will only realize compensation from grants of stock options to the extent the trading price of our common stock is greater than the exercise price of such stock options. (2) The amounts reported reflect the cash bonus determined by our Compensation Committee (for the Named Executive Officers other than Dr. Shukla), and by our Board of Directors upon recommendation of our Compensation Committee (for Dr. Shukla), based on certain performance goals and achievement of certain developmental, clinical or regulatory milestones as specified by our Board of Directors upon recommendation of our Compensation Committee, as discussed more fully in the section below titled “—Annual Performance-Based Bonuses”. (3) The amounts reported in 2023 in this column include: (i) 401(k) Plan employer match of $9,900 and life insurance premiums of $606 to Dr. Shukla; (ii) 401(k) Plan employer match of $9,900, a five year anniversary cash bonus of $3,821 and life insurance premiums of $606 to Ms. Broadfoot; and (iii) 401(k) Plan employer match of $9,900 and life insurance premiums of $606 to Ms. Denyes.

  13. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table sets forth certain information with respect to outstanding equity awards held by each of our Named Executive Officers as of December 31, 2023:

  14. Outstanding Equity Awards at Fiscal Year-End

    | | | Option Awards | | | | | Stock Awards | | | Name | Vesting Commencement Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | Number Of Shares Or Units Of Stock That Have Not Vested (#) | Market Value Of Shares Or Units Of Stock That Have Not Vested (#) (7) | | Sanjay S. Shukla, | 3/30/2016 | 11,642(1) | — | — | 68.04 | 3/30/2026 | — | — | | M.D., M.S. | 9/13/2016 | 1,964(2) | — | — | 42.84 | 9/13/2026 | — | — | | | 2/7/2017 | 4,642(2) | — | — | 46.20 | 2/7/2027 | — | — | | | 11/1/2017 | 32,142(2) | — | — | 56.00 | 11/1/2027 | — | — | | | 2/6/2018 | 21,428(2) | — | — | 46.20 | 2/6/2028 | — | — | | | 2/6/2019 | 14,285(2) | — | — | 7.24 | 2/6/2029 | — | — | | | 2/5/2020 | 37,688(2) | 1,639 | — | 4.51 | 2/5/2030 | — | — | | | 5/26/2020 | 32,762(2) | 3,809 | — | 4.06 | 5/26/2030 | — | — | | | 2/4/2021 | 79,666(2) | 32,803 | — | 4.52 | 2/4/2031 | — | — | | | 5/21/2021 | 133,688(2) | 73,312 | — | 4.45 | 5/21/2031 | — | — | | | 2/3/2022 | 38,042(2) | 44,958 | — | 5.52 | 2/3/2032 | — | — | | | 2/3/2022 | — | — | — | — | — | 31,125(6) | 43,886 | | | 5/24/2022 | 204,361(2) | 311,919 | — | 2.81 | 5/24/2032 | — | — | | | 2/16/2023 | 70,020(2) | 266,075 | — | 2.20 | 2/16/2033 | — | — | | Jill M. Broadfoot | 7/30/2018 | 14,285(1) | — | — | 11.41 | 7/30/2028 | — | — | | | 2/6/2019 | 3,571(2) | — | — | 7.24 | 2/6/2029 | — | — | | | 2/5/2020 | 22,386(2) | 973 | — | 4.51 | 2/5/2030 | — | — | | | 5/26/2020 | 13,438(2) | 1,562 | — | 4.06 | 5/26/2030 | — | — | | | 2/4/2021 | 35,417(2) | 14,583 | — | 4.52 | 2/4/2031 | — | — | | | 5/21/2021 | 34,875(2) | 19,125 | — | 4.45 | 5/21/2031 | — | — | | | 2/3/2022 | 13,750(2) | 16,250 | — | 5.52 | 2/3/2032 | — | — | | | 2/3/2022 | — | — | — | — | — | 11,250(6) | 15,863 | | | 5/24/2022 | 29,825(2) | 45,522 | — | 2.81 | 5/24/2032 | — | — | | | 2/16/2023 | 17,505(2) | 66,518 | — | 2.20 | 2/16/2033 | — | — | | Nancy E. Denyes | 10/10/2014 | 2,542(3) | — | — | 248.36 | 10/10/2024 | — | — | | | 4/17/2015 | 448(4) | — | — | 128.10 | 4/17/2025 | — | — | | | 5/6/2015 | 628(2) | — | — | 196.00 | 5/6/2025 | — | — | | | 10/1/2015 | 1,214(2) | — | — | 143.36 | 10/1/2025 | — | — | | | 1/27/2016 | 1,428(2) | — | — | 85.96 | 1/27/2026 | — | — | | | 9/13/2016 | 2,607(2) | — | — | 42.84 | 9/13/2026 | — | — | | | 2/7/2017 | 2,500(2) | — | — | 46.20 | 2/7/2027 | — | — | | | 2/6/2018 | 3,571(2) | — | — | 46.20 | 2/6/2028 | — | — | | | 5/16/2018 | 3,571(5) | — | — | 11.90 | 5/16/2028 | — | — | | | 2/6/2019 | 8,928(2) | — | — | 7.24 | 2/6/2029 | — | — | | | 2/5/2020 | 13,204(2) | 574 | — | 4.51 | 2/5/2030 | — | — | | | 5/26/2020 | 13,438(2) | 1,562 | — | 4.06 | 5/26/2030 | — | — | | | 2/4/2021 | 31,875(2) | 13,125 | — | 4.52 | 2/4/2031 | — | — | | | 5/21/2021 | 38,104(2) | 20,896 | — | 4.45 | 5/21/2031 | — | — | | | 2/3/2022 | 9,854(2) | 11,646 | — | 5.52 | 2/3/2032 | — | — | | | 2/3/2022 | — | — | — | — | — | 8,062(6) | 11,368 | | | 5/24/2022 | 34,872(2) | 53,225 | — | 2.81 | 5/24/2032 | — | — | | | 2/16/2023 | 17,505(2) | 66,518 | — | 2.20 | 2/16/2033 | — | — |

  15. Outstanding Equity Awards at Fiscal Year-End

    (1) 1/4th of the shares subject to the option vest one year from Vesting Commencement Date and the remaining shares subject to the option vest in 36 equal monthly installments following the one-year anniversary of the Vesting Commencement Date. The option is subject to full acceleration in the event the employee is terminated by us without Cause or resigns for Good Reason within the period commencing two months prior to and ending 12 months following a Change in Control or Sale Event (as such capitalized terms are defined in the 2015 Stock Plan or the respective stock option agreements evidencing such stock option, as applicable). 1/48th of the total shares subject to the option vest monthly from the Vesting Commencement Date set forth in the table above. The option is subject to full acceleration in the event the employee is terminated by us without Cause or resigns for Good Reason within the period commencing two months prior to and ending 12 months following a Change in Control or Sale Event (as such capitalized terms are defined in the 2015 Stock Plan or the respective stock option agreements evidencing such stock option, as applicable). 1/4th of the shares subject to the option vest one year from Vesting Commencement Date and the remaining shares subject to the option vest in 36 equal monthly installments following the one-year anniversary of the Vesting Commencement Date. The option is subject to full acceleration in the event the employee is terminated by us without Cause or resigns for Good Reason within the period commencing two months prior to and ending 12 months following a Change in Control or Sale Event (as such capitalized terms are defined in the 2014 Stock Plan or the respective stock option agreements evidencing such stock option, as applicable). (4) 1/48th of the total shares subject to the option vest monthly from the Vesting Commencement Date set forth in the table above. The option is subject to full acceleration in the event the employee is terminated by us without Cause or resigns for Good Reason within the period commencing two months prior to and ending 12 months following a Change in Control or Sale Event (as such capitalized terms are defined in the 2014 Stock Plan or the respective stock option agreements evidencing such stock option, as applicable). (5) 1/36th of the total shares subject to the option vest monthly from the Vesting Commencement Date set forth in the table above. The option is subject to full acceleration in the event the employee is terminated by our company without Cause or resigns for Good Reason within the period commencing two months prior to and ending 12 months following a Change in Control or Sale Event (as such capitalized terms are defined in the 2015 Stock Plan, as applicable or the respective stock option agreements evidencing such stock option). (6) Vested in four equal annual installments from Vesting Commencement Date set forth in the table above. Value is based on our closing stock price on December 31, 2023 of $1.41, as reported on the Nasdaq Capital Market.

  16. PAY VERSUS PERFORMANCE

    PAY VERSUS PERFORMANCE We are providing the following information about the relationship between executive compensation actually paid and certain financial performance of our company as required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(v) of Regulation S-K. Use of the term “compensation actually paid” is required by the SEC’s rules and as a result of the calculation methodology required by the SEC, such amounts differ from compensation actually received by the individuals and the compensation decisions described in the “Executive Compensation” section above.

  17. PAY VERSUS PERFORMANCE

    | Year | Summary Compensation Table Total for Principal Executive Officer (“PEO”) (1) | Compensation Actually Paid to PEO (2) | Average Summary Compensation Table Total for Non-PEO Named Executive Officers (“NEOs”) (3) | Average Compensation Actually Paid to Non-PEO NEOs (4) | Value of Initial Fixed $100 Investment Based On Total Stockholder Return (“TSR”) (5) | Company Net Income (Loss) (thousands) | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | | 2023 | $1,300,525 | $596,670 | $664,560 | $473,280 | $36.34 | $(50,389) | | 2022 | $2,411,435 | $480,848 | $885,511 | $29,260 | $56.44 | $(45,338) | | 2021 | $1,892,708 | $1,647,683 | $904,366 | $1,119,241 | $192.43 | $(33,777) |

  18. PAY VERSUS PERFORMANCE

    (1) The dollar amounts reported in column (b) are the amounts of total compensation reported for Dr. Shukla (our Chief Executive Officer and PEO) for each corresponding year in the “Total” column of the Summary Compensation Table. Refer to “Executive Compensation—Summary Compensation Table”. (2) The dollar amounts reported in column (c) represent the amount of “compensation actually paid” to Dr. Shukla and the amounts reported in column (e) represent average “compensation actually paid” to the NEOs as a group (excluding Dr. Shukla), as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of compensation earned by or paid to our NEOs during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to the NEO’s total compensation for each year to determine the compensation actually paid:

  19. PAY VERSUS PERFORMANCE

    | Year | NEOs | Summary Compensation Table (“SCT”) Total Compensation | Deduct: Grant Date Fair Value of the “Stock Awards” and “Option Awards” Columns in the SCT for Applicable Year* | Add: Fair Value at Applicable Year End of Awards Granted during Applicable Year that Remain Unvested as of Applicable Year End* | Add: Change in Fair Value from the end of the Prior Year to the end of the Applicable Year of Awards Granted during Prior Year that were Outstanding and Unvested as of Applicable Year End* | Add: Vesting Date Fair Value of Awards Granted during Prior FY that Vested During Applicable FY* | Add: Change in Fair Value as of the Vesting Date of Awards Granted in Prior Year that Vested in the Applicable Year | Compensation Actually Paid | | 2023 | PEO | $1,300,525 | $532,341 | $220,536 | $(374,017) | $79,723 | $(97,756) | $596,670 | | | Average Non-PEO NEOs | $664,560 | $133,084 | $110,267 | $(162,087) | $39,861 | $(46,237) | $473,280 |

  20. PAY VERSUS PERFORMANCE

    * The valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. The dollar amounts reported in column (d) represent the average of the amounts reported for Ms. Broadfoot and Ms. Denyes (our non-PEO NEOs for each year presented) as a group in the “Total” column of the Summary Compensation Table in each applicable year. Refer to “Executive Compensation—Summary Compensation Table”. Cumulative TSR is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between our company’s share price at the end and the beginning of the measurement period by our company’s share price at the beginning of the measurement period. This amount assumes an initial investment of $100 on December 31, 2020. No dividends were paid on stock or option awards in 2021, 2022 or 2023). The dollar amounts reported represent the amount of net income (loss) reflected in our consolidated audited financial statements for the applicable year. Due to the fact that we are not a commercial-stage company, we did not have any revenue during the periods presented, other than revenue associated with a milestone payment and collaboration revenue under our license and collaboration agreement with Kyorin. Consequently, the Company did not use net income (loss) as a performance measure in its executive compensation program.

  21. Analysis of the Information Presented in the Pay versus Performance Table

    Analysis of the Information Presented in the Pay versus Performance Table We generally seek to incentivize long-term performance, and therefore do not specifically align our performance measures with “compensation actually paid” (as computed in accordance with Item 402(v) of Regulation S-K) for a particular year. In accordance with Item 402(v) of Regulation S-K, we are providing the following descriptions of the relationships between information presented in the Pay Versus Performance table. Compensation Actually Paid and Net Income (Loss) Our company has not historically looked to net income (loss) as a performance measure for our executive compensation program. Our net loss was $(45.3) million in 2022 and $(50.4) million in 2023. As a result, we do not believe there is any meaningful relationship between our net loss and compensation actually paid to our NEOs during the periods presented. The graph below shows the relationship between compensation actually paid to our PEO and the average amount of compensation actually paid to our non-PEO NEOs, on one hand, to the Company’s net loss over the three years presented, on the other hand. Compensation Actually Paid and Cumulative TSR The graph below shows the relationship between compensation actually paid to our PEO and the average amount of compensation actually paid to our non-PEO NEOs, on one hand, to the Company’s cumulative TSR over the three years presented, on the other hand. All information provided above under the “Pay Versus Performance” heading will not be deemed to be incorporated by reference in any filing of our company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, except to the extent the Company specifically incorporates such information by reference.

  22. Director Compensation

    Director Compensation Our Board of Directors adopted a non-employee director compensation policy in May 2015 that is designed to provide a total compensation package that enables us to attract and retain, on a long-term basis, high-caliber non-employee directors. In January 2016, February 2017, February 2022 and February 2024, our Board of Directors adopted amendments to the policy with respect to the cash and equity component of compensation to our non-employee directors. Under this policy, as amended to date, all non-employee directors are paid cash compensation for service on the Board of Directors and committees of the Board of Directors as set forth below, prorated based on days of service during a calendar year.

  23. Director Compensation

    | Board of Directors | Annual Retainer | | All non-employee members | $40,000 | | Additional retainer for Chairperson | $35,000 | | Audit Committee: | | | Chairperson | $25,000 | | Non-Chairperson members | $8,000 | | Compensation Committee: | | | Chairperson | $12,000 | | Non-Chairperson members | $6,000 | | Nominating and Corporate Governance Committee: | | | Chairperson | $8,000 | | Non-Chairperson members | $4,000 |

  24. Director Compensation

    In addition, under the policy, each newly appointed or elected non-employee director will receive an option grant to purchase up to 48,000 shares of common stock, which will vest in equal monthly installments during the 36 months following the grant date, subject to the director’s continued service on our Board of Directors. Thereafter, on the date of each annual meeting of stockholders, each continuing non-employee director will be eligible to receive an annual option grant to purchase up to 24,000 shares of common stock, which will vest in full upon the earlier of the first anniversary of the date of grant or the date of the following annual meeting of stockholders, subject to the director’s continued service on our Board of Directors (each, an “Annual Grant”). All of the foregoing options will be granted with an exercise price equal to the fair market value of our common stock on the date of grant. We have agreed to reimburse all reasonable out-of-pocket expenses incurred by non-employee directors in attending Board and committee meetings.

  25. Director Compensation Table—2023

    Director Compensation Table—2023 The following table sets forth information with respect to the compensation earned by our non-employee directors during the fiscal year ended December 31, 2023. During 2023, Dr. Shukla did not receive compensation for his service on the Board of Directors. The compensation paid to Dr. Shukla as an employee of our company is set forth under the heading “Executive Compensation—Summary Compensation Table”.

  26. Director Compensation Table—2023

    | Name | Fees Earned or Paid in Cash | Option Awards(1) | Total | | Timothy P. Coughlin (Chairman) (2) | $71,000 | $21,198 | $92,198 | | John K. Clarke (3) | $99,641 | $21,198 | $120,839 | | Jane A. Gross, Ph.D. (4) | $47,679 | $21,198 | $68,877 | | Svetlana Lucas, Ph.D. (5) | $52,000 | $21,198 | $73,198 | | Paul Schimmel, Ph.D. (6) | $40,000 | $21,198 | $61,198 | | Sara L. Zaknoen, M.D. (7) | $45,679 | $21,198 | $66,877 |

  27. Director Compensation Table—2023

    (1) In accordance with SEC rules, this column reflects the aggregate grant date fair value of the stock options granted during 2023 computed in accordance with FASB ASC Topic 718. For additional information on the valuation assumptions underlying the value of these stock options, see Part II, Item 8 “Financial Statements and Supplementary Date” of our Annual Report in the Notes to Consolidated Financial Statements, Note 7, “Stockholders Equity”. These amounts do not reflect the actual economic value that may be realized by the directors upon the vesting of the stock options, the exercise of the stock options or the sale of the common stock underlying such stock options. Our non-employee directors will only realize compensation to the extent the trading price of our common stock is greater than the exercise price of such stock options. (2) Mr. Coughlin held stock options to purchase an aggregate of 21,425 shares of common stock as of December 31, 2023. Mr. Coughlin was appointed the Chairman of the Board of Directors in March 2024. (3) Mr. Clarke held stock options to purchase an aggregate of 22,261 shares of common stock as of December 31, 2023. Mr. Clarke served as the Chairman of the Board of Directors until March 2024. (4) Dr. Gross held stock options to purchase an aggregate of 17,141 shares of common stock as of December 31, 2023. Dr. Lucas held stock options to purchase an aggregate of 17,141 shares of common stock as of December 31, 2023. Dr. Schimmel held stock options to purchase an aggregate of 22,763 shares of common stock as of December 31, 2023. Dr. Zaknoen held stock options to purchase an aggregate of 14,285 shares of common stock as of December 31, 2023.

  28. Executive Officer and Director Compensation

    Executive Officer and Director Compensation