BridgeBio Pharma, Inc. — Fiscal 2022 Form 10-K Summary
Reporting period: Fiscal year ended December 31, 2022. This is an annual Form 10-K, not a standalone fourth-quarter filing. The filing was dated February 23, 2023.
Business context
BridgeBio is a commercial-stage biopharmaceutical company focused on genetically driven diseases and cancers. Its pipeline spans more than 20 disease areas, from discovery through Phase 3 development. The principal value drivers were acoramidis, low-dose infigratinib, encaleret, BBP-418, BBP-631 and KRAS inhibitor programs. BridgeBio previously had two FDA-approved products, TRUSELTIQ and NULIBRY, but transferred or transitioned commercial responsibilities during 2022.
- Acoramidis: Phase 3 ATTRibute-CM trial continued after failure to meet the Month 12 six-minute walk-distance endpoint; 30-month data were expected in mid-2023.
- Low-dose infigratinib: Phase 2 development continued in children with achondroplasia; a Phase 3 trial was anticipated in 2023, subject to FDA feedback.
- Encaleret: Phase 2b results were positive in ADH1, and a Phase 3 registrational trial had begun.
- BBP-418: Interim Phase 2 data in LGMD2I were positive; a global Phase 3 trial was planned for 2023.
- BBP-631: Phase 1/2 gene-therapy development continued in CAH; four patients had been treated at the first two dose levels as of February 22, 2023.
- BBP-398: BMS received exclusive rights outside specified Asian territories under a May 2022 agreement and paid a $90.0 million upfront fee.
Financial results and liquidity
| Metric | 2022 | 2021 | Change |
|---|---|---|---|
| Total revenue | $77.6 million | $69.7 million | +$7.9 million |
| License and services revenue | $76.1 million | $65.9 million | +$10.2 million |
| Product sales | $1.6 million | $3.8 million | -$2.2 million |
| Research and development | $399.5 million | $451.0 million | -$51.6 million |
| SG&A | $143.2 million | $192.2 million | -$49.0 million |
| Restructuring and related charges | $43.8 million | — | +$43.8 million |
| Loss from operations | $(512.2) million | $(576.6) million | Improved by $64.4 million |
| Net loss | $(484.7) million | $(586.5) million | Improved by $101.8 million |
| Net loss per share | $(3.26) | $(3.90) | Improved |
| Operating cash flow | $(419.5) million | $(497.9) million | Improved by $78.4 million |
- Revenue was heavily concentrated: approximately 98.2% of 2022 revenue was attributed to Bristol-Myers Squibb, primarily from the BBP-398 arrangement.
- BridgeBio recognized $74.7 million of 2022 revenue from the BMS agreement, including $70.2 million allocated to the transferred license and $4.5 million for ongoing Phase 1 research and development services.
- The company recognized a $107.9 million net gain from the sale of its NULIBRY-related priority review voucher for $110.0 million gross proceeds. This was a nonrecurring item and materially reduced the reported net loss.
- Stock-based compensation was $93.8 million in 2022, compared with $105.6 million in 2021.
- Cash, cash equivalents and marketable securities totaled $428.3 million at December 31, 2022. Restricted cash was $37.9 million and equity securities were $43.7 million; certain restricted cash was dedicated to obligations under the BMS agreement.
- Total cash, cash equivalents and restricted cash were $416.9 million at year-end, compared with $396.4 million at year-end 2021.
- Working capital was $427.4 million. Management stated that available cash, marketable securities, restricted cash and equity investments were expected to fund operations for at least the next 12 months based on current plans.
- Consolidated debt was approximately $1.7 billion, consisting principally of $550.0 million of 2.50% convertible notes due 2027, $747.5 million of 2.25% convertible notes due 2029 and a term loan with approximately $445.2 million of principal obligations.
- Interest expense increased to $80.4 million from $46.8 million, partly because of the term loan and payment-in-kind interest.
Material changes versus 2021
- Operating expenses declined following a January 2022 restructuring that reduced the workforce, consolidated facilities and reprioritized development programs.
- Research and development expense fell 11%, while SG&A declined 26%; however, BridgeBio incurred $43.8 million of restructuring, impairment and related charges.
- BridgeBio entered into the BMS BBP-398 license agreement, receiving a $90.0 million upfront payment and becoming eligible for up to approximately $815.0 million in additional milestones plus royalties.
- BridgeBio sold the priority review voucher for $110.0 million and sold global NULIBRY rights to Sentynl for a $10.0 million upfront payment; Sentynl assumed ongoing development and commercialization responsibilities.
- Helsinn terminated the infigratinib collaboration. The parties entered into a mutual termination agreement effective December 21, 2022. TRUSELTIQ distribution and related clinical investigations were expected to end by March 31, 2023, and BridgeBio lost eligibility for future Helsinn regulatory and sales milestones.
- BridgeBio paid $20.5 million toward its term loan following the BMS upfront payment and terminated the undrawn $100.0 million second tranche of the loan facility.
- ATM equity sales generated $4.9 million of net proceeds from 455,800 shares during 2022.
- Accumulated deficit increased to $1.9 billion, and stockholders’ deficit was $1.24 billion at year-end.
Guidance, outlook, risks and unusual items
- Management expected continued operating and net losses for at least several years and stated that meaningful product revenue was not expected in the near term.
- Additional 2023 restructuring charges were estimated at approximately $6.0 million to $9.0 million, although actual costs could be higher.
- Key anticipated catalysts included acoramidis 30-month results in mid-2023, potential Phase 3 initiation for low-dose infigratinib and BBP-418, continued encaleret Phase 3 development, and additional BBP-631 data by year-end 2023.
- Clinical and regulatory execution remains the principal business risk. Acoramidis had already missed a key Month 12 primary endpoint, and interim or open-label results for other programs may not predict pivotal-trial outcomes.
- BridgeBio depends on third-party CROs and CMOs and has no internal manufacturing facilities. Manufacturing failures, supply interruptions, clinical delays, patient-enrollment challenges and regulatory holds could materially affect development timelines.
- The company has substantial debt service obligations, including term-loan principal payments and maturities concentrated in 2026-2029. The secured term loan contains restrictive covenants and mandatory-prepayment provisions.
- Future financing may be required sooner than expected. Additional equity or debt financing could dilute shareholders, increase leverage or restrict operations.
- Revenue concentration, the Helsinn termination, discontinuation of TRUSELTIQ distribution and the absence of significant recurring product sales increase dependence on licensing transactions and future approvals.
- The filing disclosed no material legal proceedings as of the filing date. Management and Deloitte reported effective disclosure controls and effective internal control over financial reporting as of December 31, 2022, with an unqualified audit opinion.
Most important facts for investors to verify
- Final clinical and regulatory status of acoramidis, including the interpretation and durability of the 30-month ATTRibute-CM results.
- Whether low-dose infigratinib and BBP-418 successfully entered Phase 3 on the anticipated timelines and whether their efficacy and safety data support registrational filings.
- BridgeBio’s cash runway after excluding restricted cash and considering ongoing operating cash burn, debt service, milestone obligations and restructuring costs.
- Terms, covenants and repayment schedule of the $445.2 million term loan, including mandatory prepayments and the 2026 maturity.
- Potential dilution from the convertible notes, stock options, restricted awards and performance-based milestone compensation.
- Whether BMS milestone payments and royalties become commercially meaningful, given that the $815.0 million potential milestone amount is contingent and not assured.
- Financial and operational consequences of TRUSELTIQ discontinuation, the Helsinn termination and the transition of NULIBRY to Sentynl.
- Reliability of estimated research and development accruals, which Deloitte identified as a critical audit matter; accrued R&D liabilities were approximately $39.8 million at year-end.