Altimmune, Inc. — Q3 2022 Form 10-Q
Reporting period: Three and nine months ended September 30, 2022; filed November 10, 2022. Altimmune is a clinical-stage biopharmaceutical company developing pemvidutide for obesity and liver disease and HepTcell for chronic hepatitis B. It has not generated product sales revenue.
Financial results
| Metric | Q3 2022 | Q3 2021 | Nine months 2022 | Nine months 2021 |
|---|---|---|---|---|
| Revenue | $2,000 | $158,000 | $42,000 | $1.133 million |
| Research and development expense | $20.262 million | $29.206 million | $51.359 million | $54.356 million |
| General and administrative expense | $4.492 million | $4.156 million | $13.329 million | $11.636 million |
| Operating loss | $24.752 million | $33.204 million | $64.646 million | $72.929 million |
| Net loss | $23.516 million | $33.510 million | $63.053 million | $73.201 million |
| Basic and diluted loss per share | $0.48 | $0.81 | $1.37 | $1.79 |
Revenue is immaterial, so revenue margins are not meaningful. Q3 interest income was $1.053 million, versus $13,000 a year earlier; nine-month interest income was $1.402 million, versus $88,000. The filing reports no product-sales revenue or meaningful profitability.
At September 30, 2022, cash, cash equivalents and restricted cash were $127.499 million, with short-term investments of $74.362 million, totaling approximately $201.9 million. Current assets were $211.004 million and current liabilities $15.742 million. Total liabilities were $20.248 million, including lease obligations; the balance sheet reports no conventional debt balance. Nine-month operating cash use was $45.280 million. Financing provided $56.824 million, principally from at-the-market stock sales; investing used $74.380 million, mainly to purchase short-term investments.
Changes and notable items
- Q3 net loss narrowed by approximately 30% year over year; nine-month net loss narrowed by approximately 14%. Lower R&D spending and higher interest income contributed. Nine-month 2021 results included an $8.070 million non-cash impairment charge related to the discontinued AdCOVID manufacturing facility.
- Q3 R&D expense fell 31% year over year as COVID-19 program spending declined, partly offset by higher pemvidutide trial costs. For the first nine months, pemvidutide development activity increased $25.2 million year over year, while COVID-19 program costs declined $32.1 million.
- Revenue declined as T-COVID and NasoShield development work ended; BARDA did not extend its NasoShield contract beyond December 2021. AdCOVID development had previously been discontinued.
- In April 2022, the first patient was dosed in the Phase 2 MOMENTUM obesity trial of pemvidutide. The associated milestone was settled in June by issuing 847,444 shares valued at $7.2 million. The company had no contingent-consideration liability at quarter end.
- Common shares outstanding increased to 49.162 million from 40.994 million at December 31, 2021. The company sold 5.204 million shares through its ATM program during the first nine months, raising $56.2 million net; the $125 million ATM program was fully used.
Outlook, risks and contingencies
Management said available cash and investments, together with expected tax refunds and R&D incentive receipts, were sufficient to fund operations for at least 12 months from issuance of the September 30 financial statements. The company also said additional capital may be needed over the longer term and that it would pursue equity or debt financing, government funding, partnerships, or asset monetization. No specific financial or clinical guidance was provided.
Key uncertainties include clinical-trial progress and outcomes, regulatory approvals, future financing needs and potential dilution. The company reported that COVID-19 had not materially affected operations or the financial statements at quarter end, but warned of possible trial, supply-chain and cost disruptions. It cited potential broader economic effects of the Russia-Ukraine conflict, including inflation, supply-chain disruption, currency and interest-rate volatility, and cybersecurity risks. A shareholder-related lawsuit remained pending in Maryland; the company considers the allegations without merit and intends to defend itself. It reported no material change to the risk factors in its 2021 Form 10-K.
Important facts for investors to verify
- Whether the company’s stated minimum 12-month runway assumptions remain valid, including expected tax refunds and R&D incentive receipts.
- Clinical progress, trial costs and data milestones for pemvidutide and HepTcell, and any material trial or regulatory updates.
- Future financing plans and potential dilution, given ongoing operating cash use and the completed ATM program.
- Status and potential consequences of the pending litigation and the conditions attached to the Australian R&D incentive credit recorded as a liability.