SEC Filing Summary — GlycoMimetics, Inc. 10-Q
Entity discrepancy: The supplied filing is for GlycoMimetics, Inc., not Crescent Biopharma, Inc. It covers the quarter and six months ended June 30, 2018; the interim financial statements are unaudited.
Business context and reporting period
GlycoMimetics is a clinical-stage biotechnology company developing glycomimetic drug candidates. It had no approved products or commercial drug sales. Its programs include uproleselan (GMI-1271), GMI-1359 and rivipansel, which is licensed to Pfizer. The filing was signed August 9, 2018.
Financial performance and liquidity
| Metric | Three months ended June 30, 2018 | Six months ended June 30, 2018 | Comparable 2017 period |
|---|---|---|---|
| Revenue | $0 | $0 | $0 |
| Research and development expense | $9.3 million | $18.3 million | $5.7 million and $11.6 million |
| General and administrative expense | $2.8 million | $5.7 million | $2.5 million and $4.6 million |
| Net loss | $11.3 million | $22.8 million | $8.1 million and $16.1 million |
| Basic and diluted loss per share | $0.26 | $0.58 | $0.30 and $0.63 |
| Operating cash used | Not presented by quarter | $23.3 million | $15.2 million |
At June 30, cash and cash equivalents were $229.4 million, versus $123.9 million at December 31, 2017. Current assets were $232.9 million and current liabilities $7.0 million. Total liabilities were $7.7 million, primarily payables, accruals and deferred rent; the balance sheet reports no borrowings. No product revenue or gross margin was reported, so operating margins are not meaningful.
Six-month investing cash use was $42,000. Financing provided $128.8 million, primarily from the March public offering, which generated $128.4 million net proceeds. Cash increased by $105.5 million. Accumulated deficit was $175.1 million.
Material changes versus prior period
- Q2 R&D expense increased 63% year over year; six-month R&D increased 58%. The main driver was higher uproleselan manufacturing and formulation costs in preparation for Phase 3 and third-party trial supply commitments. Completed enrollment in the prior Phase 1/2 trial reduced clinical-trial costs in part.
- Six-month G&A expense increased 24%, primarily due to higher legal and patent expenses, as well as personnel and stock-based compensation.
- Net loss widened year over year in both Q2 and the first half, despite higher interest income. Loss per share was lower year over year, while weighted-average shares increased substantially, reflecting equity issuance.
- The March 2018 offering issued 8.05 million shares at $17 per share. The company reported $80 million remaining under its September 2017 at-the-market sales agreement as of June 30, with no sales under that facility in the first half.
Outlook, commentary and risks
- Management expected existing cash and cash equivalents to fund operating expenses and capital needs for at least 12 months after filing; the MD&A also stated funding was expected through preliminary results from the planned uproleselan Phase 3 trial. Management cautioned that assumptions could prove wrong and capital could be used sooner.
- The planned randomized Phase 3 uproleselan trial in relapsed/refractory AML was expected to begin enrollment in Q3 2018, enroll approximately 380 patients, and produce preliminary results by the end of 2020. Pfizer expected to complete enrollment in its rivipansel Phase 3 trial in early 2019, with top-line data expected in Q2 2019.
- Other stated plans included continued enrollment in the uproleselan multiple-myeloma Phase 1 trial, with initial data anticipated in Q1 2019; HOVON and NCI collaborations to evaluate uproleselan in additional AML/MDS populations; and a Phase 1 single-dose study of GMI-1359.
- There were no Pfizer milestone payments or revenue in the first half. Potential Pfizer development, regulatory and sales milestones and royalties remain contingent on clinical, regulatory and commercial outcomes. The company owes the University of Basel 10% of future Pfizer rivipansel milestone and royalty payments.
- Management expects losses and negative operating cash flows to continue. Key uncertainties include trial enrollment and results, regulatory approval, manufacturing, intellectual-property protection, reimbursement and access to future financing. Additional equity financing could dilute shareholders. Risk factors were reported as not materially changed from the 2017 Form 10-K.
- No material legal proceedings or off-balance-sheet arrangements were reported. Disclosure controls were deemed effective; no material change in internal control over financial reporting was reported.
Important facts for investors to verify
- Confirm that this GlycoMimetics filing is the intended issuer, given the Crescent Biopharma metadata.
- Track uproleselan Phase 3 start, enrollment, costs and data timing, as well as the company’s trial-supply and funding commitments.
- Verify Pfizer’s rivipansel trial progress and any milestone eligibility; future payments are not assured.
- Monitor cash burn, runway assumptions and potential use of the remaining at-the-market facility or other financing.
- Assess the effect of increased share count, outstanding equity awards and future capital needs on dilution.