Commitments, Contingencies and Related Party Transactions

12 Months Ended

Dec. 31, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments, Contingencies and Related Party Transactions

Lease

Rent expense was $0.2 million for the years ended December 31, 2023 and 2022. From May 2019 through April 2022, the Company leased office space in San Diego, California. In April 2022, the Company entered into a sublease agreement for office space in San Diego, California which expired in July 2023 (the “San Diego Lease”). In May 2023, the Company entered into a lease agreement for the same office space which expires on September 30, 2025. Base rent under such lease is approximately $145,000 annually and the monthly rent expense will be recognized on a straight-line basis over the effective term of the lease.

The San Diego Lease is included in the accompanying consolidated balance sheet at the present value of the lease payments. As the San Diego Lease does not have an implicit interest rate, the present value reflects a 10.0% discount rate which is the estimated rate of interest that the Company would have to pay in order to borrow an amount equal to the lease payments on a collateralized basis over a similar term and in a similar economic environment. As of December 31, 2023, the Company has recognized a net operating lease right-of-use asset and a lease liability of $0.3 million that matures in September 2025, which has a weighted average remaining lease term of 1.8 years. As of December 31, 2022, the Company’s lease had a weighted average remaining lease term of 0.6 years.


Maturity of lease liabilities	Operating Leases
2024	$	196
2025		150
Total lease payments		346
Less imputed interest		(28	)
Total lease liability		318
Less current portion of lease liability		(173	)
Lease liability, long-term	$	145

Related Party Transactions

Effective in September 2019, the Company and Shanghai Pharmaceutical (USA) Inc. (“SPH USA”) entered into a Materials Supply and Services Agreement (“SPH USA Services Agreement”), pursuant to which the Company and SPH USA will execute various statements of work for the transfer to SPH USA of key reagents and other materials, and for the supply of certain services by the Company to SPH USA, as contemplated under and in furtherance of the License and Development Agreement between the Company and SPH USA effective as of November 2018. During 2023, the Company sold $0.5 million of materials to SPH USA which was recorded as an offset to ONCT-216 operating expenses. As of December 31, 2023 and 2022, the Company had amounts receivable of $0.1 million and none, respectively, from SPH USA related to license agreement. SPH USA is the Company’s largest stockholder and an affiliate of one of the Company’s directors.

Oncternal Therapeutics, Inc. 10-K