Replimune Group, Inc. — FY2022 Form 10-K
Reporting period: Fiscal year ended March 31, 2022, compared with the year ended March 31, 2021. Although the request metadata says “2021 Q4,” this filing reports a full fiscal year, not a standalone quarter. Replimune is a clinical-stage biotechnology company developing oncolytic immunotherapies; it had no approved products and no product sales.
Financial performance and liquidity
| Metric | FY2022 | FY2021 |
|---|---|---|
| Revenue from product sales | None | None |
| Research and development expense | $79.5 million | $56.8 million |
| Selling, general and administrative expense | $38.8 million | $23.2 million |
| Total operating expenses / operating loss | $118.3 million | $80.0 million |
| Net loss | $118.0 million | $80.9 million |
| Net loss per share, basic and diluted | $2.26 | $1.75 |
| Net cash used in operating activities | $82.2 million | $61.4 million |
- Operating expenses rose 48% year over year. R&D increased 40%, while SG&A increased 67%, reflecting expanded development activity, personnel, manufacturing-facility costs, and pre-commercial planning.
- Cash, cash equivalents, and short-term investments totaled $395.7 million at March 31, 2022, versus $476.3 million a year earlier. Cash and cash equivalents alone were $105.9 million; short-term investments were $289.7 million.
- Cash and cash equivalents declined $76.6 million during the year. Financing provided $6.6 million, primarily from stock-option exercises; investing used $1.8 million.
- No debt was outstanding at year-end; the Hercules term loan had been repaid in December 2020. The balance sheet included $27.0 million of finance-lease liabilities and $5.9 million of operating-lease liabilities.
- Current assets were $404.0 million and current liabilities $20.8 million. The filing does not report a gross margin because there were no product sales.
- Management estimated existing cash and investments would fund planned operations into the second half of calendar 2024, excluding any FDA-required confirmatory trial. The filing also states resources should cover at least 12 months from issuance of the financial statements.
Business developments and changes versus prior year
- RP1: The lead candidate was being studied alone and with anti-PD-1 therapies. The CERPASS Phase 2 trial tests RP1 plus Regeneron’s cemiplimab against cemiplimab alone in approximately 180 anti-PD-1-naive patients with cutaneous squamous cell carcinoma (CSCC). Management expected enrollment completion around mid-2022, with top-line data in early 2023.
- IGNYTE: A registration-directed Phase 2 cohort was enrolling 125 patients with anti-PD-1-failed melanoma. Management reported March 2022 data showing a 37.5% overall response rate in anti-PD-1-failed disease and expected initial directional data from the first 75 patients in late 2022. A filing-intended primary analysis was expected 12 months after the final patient enrolled.
- In IGNYTE’s anti-PD-1-naive NMSC cohort, reported CSCC data showed nearly half of patients achieved complete response and nearly 65% achieved complete or partial response. An extension cohort was enrolling anti-PD-(L)-1-failed patients; enrollment continued in MSI-H/dMMR and NSCLC cohorts.
- RP2 and RP3: RP2’s initial 30-patient combination cohort with nivolumab was fully enrolled, and an amended expansion focused on selected tumor types. RP3 began combination enrollment after early monotherapy data identified a recommended Phase 2 dose. Initial expanded-cohort data for both candidates was expected toward the end of 2022.
- Management planned to begin Phase 2 signal-finding studies for RP2 and/or RP3 in head and neck cancer, hepatocellular carcinoma, and microsatellite-stable colorectal cancer around the end of 2022.
- The Framingham manufacturing facility was operational. RP1 and RP2 manufacturing transfers were complete, and RP3 transfer was nearly complete. RP1 comparability work had been submitted to the FDA; RP2 comparability studies were ongoing.
- After year-end, the company sold 1,686,438 shares under its at-the-market program for $32.0 million gross proceeds, less $1.0 million in fees. This subsequent financing was not included in March 31, 2022 cash.
Outlook, risks, and unusual items
- Management expects substantial ongoing losses and increased R&D and operating costs; profitability depends on successful clinical development, regulatory approval, manufacturing, and commercialization. No specific revenue or earnings guidance was provided.
- Key risks include uncertain clinical results and regulatory pathways, possible need for additional or randomized confirmatory trials, clinical-trial enrollment delays, and dependence on collaborators for anti-PD-1 drug supply.
- Manufacturing transfer, FDA comparability review, facility qualification, raw-material availability, and operating costs could delay studies or require additional funding. The stated runway excludes a potential confirmatory trial.
- COVID-19 had affected enrollment in some studies and could continue to disrupt trials, suppliers, manufacturing, or regulatory reviews. The company also cited inflation, supply-chain disruption, foreign-exchange exposure, and the Russia-Ukraine conflict as uncertainties.
- Research and development incentives of $3.2 million were recognized in FY2022, principally under the UK tax-relief program. The company recorded no income-tax benefit on its losses due to valuation allowances. Other income included $1.1 million of foreign-currency transaction losses.
- Accumulated deficit was $311.2 million. The independent auditor gave an unqualified opinion on the consolidated financial statements. Management concluded disclosure controls and internal control over financial reporting were effective; the auditor did not attest to internal-control effectiveness.
Important facts for investors to verify
- Whether CERPASS enrollment, analysis timing, and early-2023 data expectations were achieved, and whether results support a regulatory filing.
- Updated efficacy and durability data from the 125-patient anti-PD-1-failed melanoma cohort, and the FDA’s requirements for a BLA and confirmatory trial.
- RP2/RP3 trial progress and whether the planned Phase 2 studies began on schedule.
- FDA feedback on RP1 manufacturing comparability and completion of RP2/RP3 transfers and facility qualification.
- Current cash runway after the subsequent $32.0 million gross ATM sale, future cash burn, and whether additional financing is needed, particularly if a confirmatory trial is required.