Biomea Fusion, Inc. — Q3 2023 Form 10-Q
Reporting period: Quarter and nine months ended September 30, 2023. The company is a clinical-stage biopharmaceutical developer of covalent small-molecule therapies for genetically defined cancers and metabolic diseases. It has no approved products and has generated no revenue.
Financial position and results
| Metric | Q3 2023 / September 30, 2023 | Comparable period / prior year-end |
|---|---|---|
| Revenue | None | None |
| Operating expenses | $31.1 million for Q3; $88.8 million for nine months | $23.5 million and $57.4 million, respectively, in 2022 |
| Research and development | $25.3 million for Q3; $71.7 million for nine months | $18.2 million and $42.2 million, respectively, in 2022 |
| Net loss | $28.4 million for Q3; $82.4 million for nine months | $22.9 million and $56.5 million, respectively, in 2022 |
| Loss per share, basic and diluted | $0.80 for Q3; $2.46 for nine months | $0.78 and $1.93, respectively, in 2022 |
| Cash, cash equivalents and restricted cash | $199.5 million | $112.3 million at December 31, 2022 |
| Total assets / total liabilities | $225.1 million / $25.5 million | $129.3 million / $20.8 million at December 31, 2022 |
For the nine months, operating cash use was $73.8 million, compared with $42.2 million in 2022. Investing activities used $2.2 million; financing provided $163.2 million, primarily from the April 2023 public offering. Stockholders’ equity was $199.6 million. The company reported no interest-bearing debt; operating lease liabilities totaled $12.1 million. Gross margin is not applicable because there was no revenue.
Material changes and financing
- Nine-month R&D expense increased $29.5 million year over year, primarily due to greater clinical activity, manufacturing for clinical development, increased personnel and added facilities. G&A expense rose $1.9 million, principally from higher personnel costs.
- Nine-month net loss increased $25.9 million year over year. Management expects losses and expenses to continue and increase as clinical programs advance.
- In April 2023, the company sold 5.75 million shares at $30 per share, receiving approximately $161.8 million net of about $11.0 million in offering costs. Shares outstanding increased from 29.6 million at year-end 2022 to 35.7 million at September 30, 2023.
- Management said available cash, cash equivalents, restricted cash and investments should fund planned operations for at least one year past the financial statements’ issuance date. It also expects to need substantial additional capital; actual runway depends on spending and clinical-development needs.
Programs, outlook and risks
- BMF-219 in oncology: The company reported two complete responses among five relapsed/refractory AML patients with menin-dependent mutations treated at Dose Level 4 in the ongoing Phase 1 COVALENT-101 trial. It reported no dose-limiting toxicities at that point and said Dose Level 5 enrollment had begun. These are early, small-cohort results, not evidence of established efficacy.
- BMF-219 in type 2 diabetes: In the initial COVALENT-111 cohorts, company-reported HbA1c changes varied by dose and food status. In the 100 mg without-food cohort, the company reported a median 1.0 percentage-point reduction at Week 4 and continuing responses in some patients at Week 12. Across 32 patients dosed for four weeks at 100 or 200 mg, it reported HbA1c reductions from baseline in 84% at Week 4 and 74% at Week 12. The company described these findings as preliminary. It reported no severe or serious treatment-emergent adverse events in the cited groups; 200 mg with food was associated with increased mild-to-moderate nausea, and that cohort was to transition to 100 mg twice daily.
- In September, FDA and Health Canada cleared expansion cohorts of COVALENT-111, intended to enroll approximately 300 patients and evaluate 100 mg and 200 mg dosing for up to 12 weeks. In October, after quarter-end, the FDA cleared the COVALENT-112 IND for BMF-219 in type 1 diabetes. The company also reported the first patient dosed in the BMF-500 Phase 1 leukemia trial in October.
- The company’s principal development risks include uncertain clinical efficacy and safety, regulatory and enrollment delays, manufacturing and third-party dependence, competition, intellectual-property protection, and the need for additional financing. It cautions that preliminary clinical results may change as more data are collected and verified.
- No specific financial guidance was provided. Management expects significant ongoing R&D spending and operating losses. The company reported no material legal proceedings, no material change in previously disclosed contractual obligations, and effective disclosure controls as of quarter-end.
Important facts for investors to verify
- Updated, sufficiently sized and complete clinical data for BMF-219, including durability, safety, dose selection and the basis for the reported responses in oncology and diabetes.
- Progress, enrollment and safety in the COVALENT-111 expansion, COVALENT-112 and BMF-500 trials, including any protocol or regulatory changes.
- Cash burn relative to the stated runway, expected trial and manufacturing costs, and the timing and terms of any future financing.
- Share-count effects from the April offering, equity awards and any future use of the company’s financing programs.