Immunome, Inc. — Form 10-Q Summary
Reporting period: Quarter and six months ended June 30, 2021. Unaudited results. Immunome is a preclinical biopharmaceutical company focused on oncology and infectious disease; it has not generated product revenue.
Financial performance and liquidity
- Revenue: No product revenue; the filing does not report revenue from product sales.
- Quarterly results: Operating expenses were $5.74 million, including research and development (R&D) of $3.23 million and general and administrative (G&A) of $2.51 million. Net loss was $5.24 million, or $0.46 per share, versus a $2.71 million loss, or $2.45 per share, in Q2 2020.
- Six-month results: Operating expenses were $9.64 million and net loss was $9.14 million, compared with $5.37 million and $5.39 million, respectively, in the first half of 2020. R&D was $5.21 million and G&A was $4.43 million.
- Margins: Not meaningful because the company had no product sales.
- Cash flow: Operating cash use was $7.28 million in the first half, versus $3.54 million in 2020. Investing cash use was $0.04 million; financing provided $27.38 million. Cash and restricted cash increased by $20.06 million.
- Balance sheet at June 30: Cash was $59.83 million; current assets $62.82 million; current liabilities $3.52 million; total assets $64.14 million; and stockholders’ equity $60.62 million. Long-term debt was zero; equipment-loan payable was $44,000. No dividends were reported.
Changes and notable items
- April’s private placement generated $27.0 million gross, or $26.4 million net, from 1.0 million common-stock-and-warrant units. The warrants are exercisable at $45 per share; the financing and warrant exercises contributed to an increase in shares outstanding.
- R&D expense increased year over year, despite DoD reimbursements recorded as reductions to R&D expense: approximately $4.1 million for Q2 and $8.0–$8.1 million for the first half. The DoD award was increased from $13.3 million to $17.6 million in May; $1.7 million was receivable at quarter-end.
- G&A rose substantially, primarily due to increased personnel and public-company professional, legal, consulting, and insurance costs.
- The $0.5 million Paycheck Protection Program loan was forgiven in May and recorded as other income.
- In June, Immunome entered an exclusive worldwide license for antibodies targeting bacterial biofilm-related diseases. Potential payments include development, regulatory, and commercial milestones, royalties, and annual minimum payments starting in 2022.
Outlook, risks, and controls
- Management expects continuing losses and rising expenses as it advances research and development. It said cash on hand was expected to fund operations through fiscal 2022 and planned Phase 1b studies for IMM-ONC-01 and IMM-BCP-01; the company also states its programs were in preclinical development. The filing provides no revenue or earnings guidance.
- Management cautioned that estimates depend on assumptions and cash could be exhausted sooner than expected. Additional financing will be needed beyond the stated runway; no external funding source is committed. Failure to raise capital could require delaying, reducing, or ending programs, pursuing collaborations or strategic alternatives, or ceasing operations.
- In July, after quarter-end, the company reported preclinical pseudovirus neutralizing activity of IMM-BCP-01 against the SARS-CoV-2 Delta variant and in-vitro activity through non-neutralizing mechanisms. These are preclinical findings, not clinical evidence.
- Management said COVID-19 had not significantly affected operations or results to date, but the pandemic and variants could affect research timelines and future clinical-trial activity.
- Disclosure controls and procedures were deemed ineffective due to material weaknesses in journal-entry review, account-balance review, and accounting staffing. Remediation was underway but not yet complete; management stated the financial statements fairly presented the company’s results.
- The company reported no material legal proceedings and no off-balance-sheet arrangements.
Important facts for investors to verify
- Whether the stated cash runway through fiscal 2022 still covers planned studies, and how the company reconciles that outlook with its description of programs as preclinical.
- The pace of operating cash use, R&D spending, and DoD reimbursements, including the filing’s $8.0 million versus $8.1 million first-half reimbursement references.
- Clinical-development timing and the evidence supporting IMM-BCP-01’s reported Delta-variant activity.
- Potential dilution from outstanding options and warrants, including the April 2021 warrants.
- Progress in remediating the disclosed internal-control material weaknesses and the terms and potential costs of the new license agreement.