IDEAYA Biosciences, Inc. — Q1 2021 Form 10-Q
Reporting period: Three months ended March 31, 2021; unaudited. IDEAYA is a clinical-stage precision-medicine oncology company with no approved products and no product sales. Collaboration revenue is from its GSK agreement.
Financial performance and liquidity
Amounts below are in millions, except per-share data. The company reported no debt; lease liabilities and collaboration contract liabilities are not borrowings.
| Metric | Q1 2021 | Comparable period / change |
|---|---|---|
| Collaboration revenue | $7.247 | $0 in Q1 2020; down 31% from $10.571 in Q4 2020 |
| Research and development expense | $11.566 | Up 28% from $9.026 in Q1 2020; down 4% from Q4 2020 |
| General and administrative expense | $4.816 | Up 40% from $3.452 in Q1 2020; up 27% from Q4 2020 |
| Operating loss | $9.135 | Versus $12.478 loss in Q1 2020; wider than Q4 2020 loss of $5.280 |
| Net loss | $9.021 | Versus $12.043 loss in Q1 2020; wider than Q4 2020 loss of $5.135 |
| Loss per share, basic and diluted | $(0.28) | $(0.59) in Q1 2020 |
| Net cash used in operations | $13.724 | $9.545 used in Q1 2020 |
Cash, cash equivalents and marketable securities totaled $310.4 million at March 31, 2021, including $136.8 million of cash and equivalents and $173.6 million of marketable securities. Current assets were $308.2 million and current liabilities $36.1 million. Accumulated deficit was $136.0 million. Operating cash use was partly offset by $41.9 million of net ATM proceeds; investing activities provided $36.4 million, largely from security maturities. No meaningful operating margin is reported; the company remains loss-making.
During the quarter, IDEAYA sold 2.713 million shares through its ATM program for $41.9 million net proceeds. Common shares outstanding rose from 29.54 million at year-end 2020 to 32.27 million at quarter-end. After quarter-end through May 9, it sold another 633,304 shares for $14.6 million gross proceeds.
Material changes and business developments
- Revenue began under the GSK collaboration in 2020; Q1 2021 revenue comprised MAT2A $1.467 million, Pol Theta $3.535 million and WRN $2.245 million. Revenue fluctuates with services performed and estimates of remaining costs.
- Year-over-year R&D expense rose mainly from increased headcount and IDE397 clinical-startup and manufacturing costs. G&A rose mainly from headcount and public-company costs. Higher revenue helped narrow the year-over-year net loss, despite increased operating expenses.
- IDE397, a MAT2A inhibitor for MTAP-deleted solid tumors, entered Phase 1; the company reported dosing its first patient and completing enrollment in the first dose-escalation cohort. It targeted preliminary pharmacodynamic data in the second half of 2021.
- Darovasertib (IDE196) was being evaluated in a Phase 1/2 trial for GNAQ/GNA11-mutated tumors, including metastatic uveal melanoma (MUM). The company reported preliminary, unconfirmed trial updates after quarter-end: as of April 13, 2021, the binimetinib combination had two partial responses among nine evaluable MUM patients with at least two post-baseline scans, one confirmed; as of May 5, 2021, the crizotinib combination had tumor reduction in two evaluable patients, including one unconfirmed partial response. These are early results from an unlocked database, not definitive findings.
- For darovasertib monotherapy, preliminary data as of April 13, 2021 included median overall survival of 13.2 months in predominantly pretreated MUM patients and tumor reduction in 46 of 75 evaluable patients. Management planned FDA guidance in the second half of 2021 on a potential registrational study; no submission timing was committed.
- Other programs remain preclinical: PARG (development-candidate selection targeted for 2021), Pol Theta (small-molecule candidate selection targeted for 2021) and WRN, among other discovery programs.
Outlook, risks and contingencies
- Management expects continued, increasing operating losses as clinical and preclinical programs advance. The filing gives two runway statements: the financial-statement note says available funds should cover planned operations for at least 12 months from issuance; MD&A says existing funds should fund planned operations into 2025. Investors should note this difference in stated runway.
- The GSK agreement included a $100 million upfront payment received in 2020. Potential option, milestone, profit-share and royalty payments are contingent, not assured. GSK may terminate programs or the agreement; its MAT2A option depends on delivery of Phase 1 data and GSK election. IDEAYA also bears specified cost shares for WRN and potentially MAT2A following option exercise.
- Key risks include clinical failure or safety findings, slow enrollment, regulatory uncertainty, dependence on collaborators and third-party manufacturers/CROs, companion-diagnostic availability, competition, intellectual-property challenges and the need for future capital. Equity financing may dilute shareholders.
- COVID-19 had not materially affected operations in Q1, according to the company, but could delay enrollment, trial support, manufacturing or supply. Certain CRO support personnel were based in India amid a reported surge in infections.
- Preliminary clinical findings and management’s development plans are forward-looking or interim information and may change. Combination-trial adverse events included reported serious events such as liver toxicity, syncope or hypotension, depending on regimen; the filing describes these data as preliminary.
- The company reported no material pending litigation and no material change in internal control over financial reporting; management assessed disclosure controls as effective. Lease payments expected through July 2024 totaled $7.1 million. Novartis agreement milestone payments of up to $29 million and royalties are contingent on future events.
Important facts for investors to verify
- Clarify the cash-runway statements: “at least 12 months” versus “into 2025,” including the assumptions underlying each.
- Track IDE397 Phase 1 safety, dose escalation, pharmacodynamic data and any progress toward the GSK MAT2A option decision.
- Review mature, audited trial data—not preliminary unlocked-database updates—for darovasertib monotherapy and binimetinib/crizotinib combinations, including response durability and safety.
- Monitor cash burn, collaboration revenue and reimbursements, development spending, ATM capacity and further share issuance/dilution.
- Confirm whether GSK advances or terminates any programs and whether any contingent option, milestone or royalty payments become payable.