Restructuring

9 Months Ended

Sep. 30, 2022

Restructuring and Related Activities [Abstract]

On April 4, 2022, the Board of Directors of the Company approved a reduction of the Company’s workforce by approximately 42% across all areas of the Company (47% inclusive of the closing of the majority of open positions) following the receipt of the CRL from the FDA to the Company’s NDA for vadadustat for the treatment of anemia due to CKD in adult patients. The workforce reduction was substantially completed as of June 30, 2022. On May 5, 2022, the Company implemented a further reduction in workforce consisting of several members of management. The workforce reduction is expected to be substantially complete by the end of May 2023. These actions reflect the Company’s determination to refocus its strategic priorities around its commercial product, Auryxia®, and its development portfolio, and are steps in a cost savings plan to significantly reduce the Company’s expense profile in line with being a single commercial product company.

The workforce reduction is expected to include total restructuring charges of approximately $14.7 million. During the three and nine months ended September 30, 2022, the Company recognized $0.2 million and $14.7 million, respectively, of restructuring charges in the condensed consolidated statement of operations. These charges included $11.4 million of one-time termination benefits and contractual termination benefits for severance, healthcare, and related benefits and $3.3 million of non-cash share-based compensation expense. The charges were recorded pursuant to ASC 712, Compensation-Nonretirement Postemployment Benefits or ASC 420, Exit or Disposal Cost Obligations, depending on the employee.

Details of the restructuring liability activity for the Company's workforce reduction for the period ended September 30, 2022 are as follows:


	September 30, 2022
	(in thousands)
Balance at December 31, 2021	$	—
Restructuring charges	14,711
Stock-based compensation expense	(3,253)
Severance payments and adjustments	(7,220)
Balance at September 30, 2022	$	4,238