Vor Biopharma Inc. — Q1 2021 Form 10-Q
Reporting period: Three months ended March 31, 2021. Unaudited consolidated financial statements; comparative period is Q1 2020 unless otherwise noted. Vor is a pre-revenue cell therapy company developing engineered hematopoietic stem cells and companion therapies for hematological cancers.
Financial results and liquidity
| Metric | Q1 2021 | Q1 2020 / comparison |
|---|---|---|
| Revenue | None | None |
| Research and development expense | $8.9 million | $6.2 million; up $2.8 million |
| General and administrative expense | $4.8 million | $1.7 million; up $3.1 million |
| Total operating expenses | $13.7 million | $7.9 million; up $5.9 million |
| Net loss | $13.7 million | $7.8 million |
| Net loss attributable to common stockholders | $15.0 million, or $0.67 per share | $8.6 million, or $59.06 per share |
| Net cash used in operating activities | $17.6 million | $6.1 million |
| Cash and cash equivalents at period end | $262.6 million | $48.5 million at December 31, 2020 |
| Debt | None outstanding | None outstanding |
The company reported no product revenue, so revenue-based margins are not meaningful. Cash, cash equivalents and restricted cash totaled $264.1 million at March 31, 2021. Current assets were $266.3 million versus current liabilities of $8.6 million. Management estimated that March 31 cash and cash equivalents would fund operating and capital requirements into at least Q1 2023, subject to assumptions that could prove incorrect.
Changes and notable items
- Operating expenses increased 74% year over year. R&D growth primarily reflected higher personnel and facility costs, partly offset by lower external preclinical and laboratory costs. G&A growth reflected personnel, professional fees and facility costs, including expenses associated with growth and becoming a public company.
- Operating cash use increased by $11.6 million year over year. Investing cash use was $1.2 million, primarily for property and equipment.
- Financing provided $232.8 million, including $45.4 million from the final Series B preferred financing tranche and approximately $186.3 million of net IPO proceeds. The February IPO issued 11.3 million shares at $18 per share. Preferred shares converted into common stock at IPO closing.
- Accumulated deficit was $74.9 million at March 31, 2021. Stockholders’ equity was $267.2 million, compared with a $59.1 million deficit at year-end 2020.
- The company reported $18.3 million of operating lease liabilities, primarily long-term. No material changes to contractual obligations were reported; no off-balance-sheet arrangements were identified.
Outlook, development and risks
- The FDA accepted the VOR33 IND in January 2021. Vor planned to enroll the first patient in a Phase 1/2a AML trial in Q2 2021 and expected initial data in late 2021 or the first half of 2022. In April 2021, after the quarter, the company received a Health Canada no-objection letter for the trial.
- VCAR33 was being evaluated in an investigator-sponsored Phase 1/2 trial led by the National Marrow Donor Program. Vor expected either to assume sponsorship or obtain rights to reference trial results; the filing cautions that FDA comparability or data-reference requirements could necessitate further work. Initial trial data were expected in 2022, subject to the investigator’s timing.
- Vor expected to submit an IND for the combined VOR33/VCAR33 treatment system in the second half of 2022, contingent on earlier trial data. The company had not completed clinical trials of its own product candidates and had not generated product revenue.
- Management expected losses and expenses to increase as clinical development, manufacturing, hiring, platform investment and public-company costs expand. Vor expects to need substantial additional funding; future financing may dilute shareholders, impose restrictions or require licensing valuable rights. The stated cash runway is an estimate, not a guarantee.
- A notable development risk is an external NHLBI trial of CD34-selected stem-cell grafts: reported results showed lower chronic graft-versus-host disease but higher treatment-related mortality and poorer overall survival than bone-marrow grafts. Further analysis was ongoing; Vor said any resulting protocol or manufacturing changes could delay VOR33 development.
- Other principal risks include the unvalidated nature of engineered stem-cell technology, potential serious or delayed gene-editing and cell-therapy adverse effects, clinical-trial failure or enrollment delays, manufacturing and third-party supply dependence, reliance on licensed intellectual property, regulatory uncertainty, competition and the potential impact of COVID-19. Vor said COVID-19 had not significantly affected operations to date but could disrupt trials, suppliers, sites and regulatory timelines.
- The company reported no material legal proceedings. Management concluded disclosure controls were effective at the reasonable-assurance level and reported no material change in internal control over financial reporting during the quarter.
Key facts for investors to verify
- Whether VOR33’s planned Q2 2021 first-patient enrollment occurred, and the trial’s subsequent enrollment, safety and data timing.
- Progress on VCAR33’s NMDP trial, access to its results, and whether regulators accept comparability and cross-reference arrangements.
- Whether the external CD34-selected graft findings lead to changes in VOR33’s protocol or manufacturing approach.
- Actual cash burn versus the stated runway into at least Q1 2023, and the timing and terms of any additional financing.
- Clinical, manufacturing, supply-chain, licensing and regulatory developments that could delay programs or increase costs.