13. Operating Leases

 

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. The Company’s lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments, the Company uses its incremental borrowing rate (“IBR”) based on the information available at the lease commencement date to determine the appropriate discount rate by multiple asset classes. Variable lease payments that are not based on an index or that result from changes to an index subsequent to the initial measurement of the corresponding lease liability are not included in the measurement of lease ROU assets or liabilities and instead are recognized in earnings in the period in which the obligation for those payments is incurred. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise any such options. Lease expense is recognized on a straight-line basis over the expected lease term. Rent expense was $4,467 and $4,444 for the years ended December 31, 2025 and 2024, respectively.

 

The Company leases a facility consisting of office, manufacturing and laboratory space in Florham Park, New Jersey under a lease expiring in 2036. The Company has the option to renew the term of the lease for two additional five-year terms so long as the lease is then in full force and effect; both option periods have been included in determining the lease term used in recognizing the ROU assets and lease liability.

 

The Company includes its lease costs within selling, general and administrative expenses on the consolidated statement of operations and comprehensive loss. The components of the Company’s lease costs as follows:

 

   2025   2024 
   Year Ended December 31, 
   2025   2024 
Operating lease cost  $3,911   $3,911 
Variable lease cost   1,509    1,348 
Total operating lease cost  $5,420   $5,259 

 

The table below shows the cash activity related to the Company’s lease liabilities:

 

   2025   2024 
   Year Ended December 31, 
   2025   2024 
Cash paid related to lease liabilities:          
Operating cash flows from operating leases  $3,452   $3,378 

 

 

As of December 31, 2025, the maturities of the Company’s operating lease liabilities were as follows:

 

      
2026  $3,526 
2027   3,599 
2028   3,673 
2029   3,746 
2030   3,820 
Thereafter   77,001 
Total lease payments   95,365 
Less imputed interest   (68,467)
Total  $26,898 

 

As of December 31, 2025 and 2024, the weighted average remaining lease term of the Company’s operating lease was 20.3 years, and 21.3, and the weighted average discount rate used to determine the lease liability for the operating lease was 14.24% and 14.24%, respectively.

 

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Historical Timeline

Fiscal YearFiled
2025Apr 30, 2026Showing above
2024May 8, 2025
2023Jul 30, 2024
2022Mar 31, 2023

About Leases Disclosures

Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.

Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.