Quarterly report pursuant to Section 13 or 15(d)


9 Months Ended
Sep. 30, 2023
Leases [Abstract]  

7. Leases

The Company determines whether an arrangement is or contains a lease based on the unique facts and circumstances present at the inception of an arrangement. The Company leases office and laboratory space under operating leases that have a weighted average remaining term of 1.8 years as of September 30, 2023. The Company also leases office space under short-term leases that provide for either party to terminate the lease without cause and with 30 days’ notice. The Company’s operating leases include rent escalations and are subject to additional variable charges, including common area maintenance, property taxes and property insurance. Given the variable nature of such costs, they are recognized as expense as incurred. Additionally, some of the Company’s leases are subject to certain fixed fees which the Company has determined to be non-lease components. The Company has elected the practical expedient to account for lease and non-lease components as a single-lease component and has included fixed payments related to non-lease components in calculating the operating lease liability.

The weighted average discount rate for the Company’s operating leases as of September 30, 2023 is 8.8%, representing the Company's incremental borrowing rate at the beginning of each lease. For the nine months ended September 30, 2023, total lease cost was $2,245, consisting of $1,697 operating lease cost, $50 of variable lease costs and $498 of short-term lease cost. Cash paid for amounts included in the measurement of operating lease liabilities was $1,709 for the nine months ended September 30, 2023. Rent expense for the nine months ended September 30, 2022 was $1,127.

Future lease payments under the non-cancelable operating leases as of September 30, 2023 are as follows:





October 1, 2023 - December 31, 2023















     Total undiscounted lease payments





Less imputed interest





     Total lease liability






As described further in Note 6, in August 2023, the Company entered into new work orders under the WuXi Agreement for WuXi to serve as one of the Company’s cell processing manufacturing partners for the planned global clinical development of CABA-201. Under the August 2023 work orders, WuXi will convert the Company’s non-dedicated suite to a Dedicated Suite for GMP manufacturing for the Company’s CABA-201 and MuSK-CAART programs, for an initial term of 18 months. The Company would incur a $1,080 termination fee if it terminates both the CABA-201 and MuSK-CAART work orders for any reason. As of September 30, 2023, the

Company has concluded that this lease has not yet commenced and no right of use asset or lease liability has been included in the accompanying balance sheets.