Pharvaris N.V. — 2021 Annual Report
Reporting period: Fiscal year ended December 31, 2021. This is an annual Form 20-F, not a standalone Q4 report. Financial statements are audited and prepared under IFRS as issued by the IASB, in euros.
Business context
Pharvaris is a clinical-stage biopharmaceutical company developing oral treatments for hereditary angioedema (HAE) and other bradykinin-mediated diseases. Its lead molecule, PHA121, is being developed as PHVS416 for on-demand use and PHVS719 as an extended-release prophylactic treatment. The company had no approved products or revenue in 2021.
Financial performance and liquidity
| Metric (€ unless stated) | 2021 | 2020 |
|---|---|---|
| Revenue | None | None |
| Research and development expenses | 35.8 million | 19.5 million |
| General and administrative expenses | 18.3 million | 5.5 million |
| Total operating expenses | 54.1 million | 25.0 million |
| Net loss | 42.7 million | 26.0 million |
| Net cash used in operating activities | 44.6 million | 21.5 million |
| Cash and cash equivalents, year-end | 209.4 million | 98.6 million |
| Total equity, year-end | 205.0 million | 95.8 million |
- The 2021 loss included €11.5 million of net foreign-exchange income, mostly unrealized gains from translating U.S.-dollar bank balances. Loss before tax was €42.7 million, versus €26.1 million in 2020.
- Financing activities provided €143.7 million net in 2021, primarily reflecting €146.2 million of IPO proceeds after underwriting discounts and transaction costs. Operating cash use rose as clinical development and the organization expanded.
- The company reported no borrowings. Year-end liabilities were €7.1 million, including €0.3 million of lease liabilities; €19.5 million of non-cancellable service-contract commitments were disclosed, mostly payable within one year.
- Management expected existing cash to fund operations into the first quarter of 2024, based on its operating-plan assumptions. The company cautioned that it may need additional capital sooner; it reported holding €173.6 million in U.S. dollars, creating currency exposure.
Material changes and outlook
- Compared with 2020, R&D expense increased 83% as Phase 1 work expanded and Phase 2 trials began. G&A expense increased 234%, reflecting public-company costs, hiring, and commercial preparation.
- Share-based compensation rose to €8.2 million from €1.6 million. The 2021 net loss also reflected a €0.5 million milestone payment to AnalytiCon upon commencement of Phase 2 development.
- For 2022, management forecast R&D expense of €55–65 million and G&A expense of €18–25 million. No revenue was expected before product commercialization; profitability and positive operating cash flow were not expected in the foreseeable future.
- RAPIDe-1, a Phase 2 on-demand HAE study of PHVS416, commenced in February 2021; data were anticipated in Q4 2022. CHAPTER-1, a Phase 2 prophylaxis study using PHVS416, also commenced in 2021. A Phase 1 study assessed PHVS719 extended-release pharmacokinetics.
- Management’s efficacy comparisons with icatibant rely on a Phase 1 bradykinin-challenge model and published data, not a head-to-head clinical trial. The filing states that Phase 2 efficacy data in HAE patients were not yet available.
Risks, contingencies, and unusual items
- Financial reporting controls: Management concluded disclosure controls and internal control over financial reporting were ineffective at year-end due to material weaknesses across the COSO framework, including inadequate documented controls, review, staffing, and IT controls. Remediation was underway; the auditor did not attest to control effectiveness.
- Development and execution: PHVS416 and PHVS719 were early-stage candidates, dependent on successful trials, regulatory approval, manufacturing, and third-party CROs and CDMOs. COVID-19 had delayed a prior study and could affect enrollment, supply, and regulatory timelines. The filing also cited potential disruption to trials in Germany, Poland, and Bulgaria from the Russia-Ukraine conflict.
- Funding and licensing: The company expects continuing losses and may require further financing. AnalytiCon is entitled to up to €10.5 million of remaining contingent milestone payments, plus royalties; certain uncured breaches or missed payments could jeopardize licensed intellectual property.
- Commercial risks: Future pricing, reimbursement, market acceptance, and competition—including generic icatibant and other HAE therapies—remain uncertain. The company does not intend to pay dividends in the foreseeable future.
- The company reported no contingent liabilities or contingent assets at December 31, 2021 and no material litigation during the audited period. After year-end, it filed a shelf registration for up to $350 million and entered an at-the-market sales agreement for up to $75 million of ordinary shares.
Investor facts to verify
- Whether subsequent RAPIDe-1 and CHAPTER-1 results support safety, efficacy, dose selection, and the proposed development timelines.
- Whether management’s cash-runway estimate to Q1 2024 remains achievable given actual cash burn, trial costs, and the 2022 spending outlook.
- Progress in remediating the material weaknesses and whether controls operate effectively over a sustained period.
- Potential dilution and financing terms under the shelf registration and $75 million share-sale facility, and the eventual milestone and royalty obligations to AnalytiCon.