Biomea Fusion, Inc. — FY2021 Form 10-K
Reporting period: Fiscal year ended December 31, 2021. The filing is an annual report, not a standalone fourth-quarter filing; unaudited Q4 results are included below. Biomea Fusion (Nasdaq: BMEA) is a clinical-stage biopharmaceutical company developing irreversible covalent small-molecule therapies. It had no approved products and had generated no revenue.
Financial and operating results
- Revenue: None in 2021 or 2020.
- Net loss: $41.6 million in 2021, versus $5.3 million in 2020. Basic and diluted loss per share was $1.74 versus $0.51.
- Operating expenses: $41.7 million, up $36.3 million year over year. Research and development was $28.0 million (2020: $3.7 million); general and administrative was $13.7 million (2020: $1.7 million). Increases reflected expanded development, personnel, public-company and other corporate costs.
- Q4 2021: Operating expenses were $14.7 million, including $11.1 million of R&D and $3.6 million of G&A. Net loss was $14.7 million, or $0.51 per share. Q4 2020 net loss was $3.5 million, or $0.29 per share.
- Cash flows: Net cash used in operating activities was $35.4 million in 2021, versus $4.5 million in 2020. Investing activities used $33.4 million, mainly for securities and property and equipment. Financing provided $153.2 million, primarily from the IPO.
- Liquidity: At year-end, cash and cash equivalents were $145.7 million, restricted cash $0.4 million, and short- and long-term investments $29.7 million; these totaled $175.7 million. Current assets were $176.6 million and current liabilities $4.6 million. Management estimated existing cash, restricted cash and investments would fund operations into 2024, based on its current plan.
- Debt and obligations: The company reported no interest-bearing liabilities at year-end; its $36,000 PPP loan shown at December 31, 2020 was repaid in 2021. Operating lease liabilities totaled $2.9 million. Contractual lease obligations were $5.9 million, excluding $2.2 million of rent for a lease expected to commence in September 2022.
- Margins: Not applicable because the company had no revenue. Year-end accumulated deficit was $49.7 million.
Business developments and changes
- The FDA cleared the IND for lead candidate BMF-219 in September 2021 for a Phase 1 trial in adults with relapsed or refractory acute leukemia, including patients with MLL/KMT2A rearrangements or NPM1 mutations. The first patient was dosed in January 2022, after the reporting period.
- In December 2021, the company amended the IND to include subsets of multiple myeloma and diffuse large B-cell lymphoma. The company planned additional studies in those and other cancer indications, and in diabetes, subject to additional IND submissions and clearances.
- Management reported promising preclinical findings for BMF-219 in cancer and diabetes models. These are preclinical results, not evidence of clinical efficacy or safety in humans.
- The company completed its IPO in April 2021, raising $152.8 million net of underwriting discounts, commissions and offering costs. Common shares outstanding increased to 29.1 million at year-end from 12.0 million a year earlier; preferred shares converted to common stock in connection with the IPO.
- R&D expense rose substantially as the company advanced BMF-219 and expanded staffing and development activity. The company also invested in facilities and equipment and began using a new ERP system for financial reporting in Q4.
Outlook, risks and unusual items
- Management expects losses and expenses to increase as it conducts clinical trials, pursues further INDs, advances other candidates and builds capabilities. It provided no revenue or profitability guidance.
- The company expected to nominate a second development candidate in the first half of 2022 and provide an update on a third candidate in 2022. It also described plans for BMF-219 trials in additional cancers and diabetes, subject to regulatory clearance. These are forward-looking plans, not assured milestones.
- Biomea stated it would require substantial additional capital over time. If financing is unavailable or unfavorable, it may delay, reduce or discontinue programs; equity financing could dilute shareholders.
- Key risks include the very early stage of development, dependence on BMF-219, uncertain translation of preclinical findings to humans, clinical-trial enrollment and safety risks, competition from other menin programs, reliance on third-party manufacturers and service providers, and potential supply-chain or COVID-19 disruptions.
- The company had no material legal proceedings. It reported no material foreign-currency risk and no interest-bearing liabilities at year-end. Deloitte & Touche LLP issued an unqualified opinion on the financial statements; the auditor was not engaged to opine on internal control effectiveness.
Important facts for investors to verify
- Whether the Phase 1 BMF-219 trial produces human safety, pharmacokinetic and efficacy data that support continued development.
- Whether management’s projected cash runway into 2024 remains credible as trial scope, spending and cash balances change.
- Progress and regulatory clearance for additional BMF-219 indications, and whether stated 2022 candidate-development plans were achieved.
- How operating cash burn, stock-based compensation, share issuance and potential future financing affect liquidity and dilution.
- Whether manufacturing, clinical enrollment, competitive programs or safety findings alter development timelines or the commercial opportunity.