IDEAYA Biosciences, Inc. — Q1 2022 Form 10-Q
Business context and reporting period
Quarter ended March 31, 2022; filed May 10, 2022. IDEAYA is a clinical-stage oncology biotech developing precision-medicine therapies. It had no approved products and no product-sale revenue; reported revenue was entirely from its GSK collaboration.
Financial results and liquidity
Amounts in millions of U.S. dollars, except per-share data.
| Metric | Q1 2022 | Q1 2021 | Change |
|---|---|---|---|
| Collaboration revenue | $11.4 | $7.2 | +57% |
| Research and development | $19.7 | $11.6 | +70% |
| General and administrative | $5.9 | $4.8 | +23% |
| Operating loss | $(14.2) | $(9.1) | Loss increased |
| Net loss | $(14.0) | $(9.0) | Loss increased 55% |
| Net loss per share | $(0.36) | $(0.28) | |
| Operating cash used | $19.6 | $13.7 | Cash use increased |
Operating loss was about 125% of collaboration revenue; this is not a commercial product margin. Comprehensive loss was $16.1 million, including $2.1 million of unrealized losses on marketable securities. At March 31, cash and cash equivalents were $55.3 million, marketable securities totaled $290.9 million, and cash, cash equivalents and marketable securities were $346.2 million. Total liabilities were $70.2 million, including $49.4 million of contract liabilities and $4.8 million of operating lease liabilities; the filing reports no borrowings. Management said available funds should support planned operations for at least 12 months from issuance of the statements. The company had an accumulated deficit of $190.8 million.
Material changes versus the prior comparable period
- Revenue rose $4.1 million year over year, driven by GSK collaboration activity; Q1 2022 revenue included $2.4 million recognized after GSK waived its right to initiate the MAT2A combination trial.
- R&D expense increased $8.1 million, reflecting higher personnel costs and spending on CROs, CMOs, consultants and other research needs as programs advanced.
- Net loss widened by $5.0 million. The increase in collaboration revenue was more than offset by higher operating expenses.
- Operating cash use increased $5.9 million. Financing provided $0.7 million, mainly from option exercises, versus $42.0 million in Q1 2021, largely from ATM sales.
- Marketable securities’ reported fair value declined from $276.0 million at year-end 2021 to $290.9 million at quarter-end, while unrealized losses contributed to accumulated other comprehensive loss. Cash plus marketable securities declined from approximately $368.1 million to $346.2 million.
Outlook, commentary and risks
- No financial revenue or earnings guidance was provided. Management expects operating losses and R&D spending to continue increasing; additional capital may be needed, and financing may not be available on acceptable terms.
- IDE397: As of May 1, 2022, 21 patients had been enrolled in the Phase 1 trial and the maximum tolerated dose had not been reached. Management targeted monotherapy expansion and combination cohorts around mid-2022, and a GSK option data package around mid-year. GSK’s option, if exercised and cleared as required, would trigger a $50 million payment; exercise is not assured.
- Darovasertib: The company reported preliminary results for the darovasertib–crizotinib combination in metastatic uveal melanoma, including a 31% response rate among 13 patients with at least two post-baseline scans. These were interim, small-sample results, not confirmatory evidence. FDA guidance on a potentially registration-enabling trial was targeted for mid-2022.
- Other development targets included an IDE161 PARG-inhibitor IND submission in Q4 2022, subject to preclinical progress; Pol Theta candidate selection in Q2 2022; and Werner Helicase candidate nomination in 2023.
- On April 27, 2022, after quarter-end, the FDA granted darovasertib Orphan Drug designation for metastatic uveal melanoma. Potential benefits include certain fee and tax provisions and, only if approved for the designated use, possible seven-year marketing exclusivity.
- Key risks include clinical and regulatory uncertainty, patient enrollment, reliance on CROs and manufacturers, collaboration-partner decisions (especially GSK’s MAT2A option), competition, access to capital, and possible COVID-19 or geopolitical disruption. The company reported no litigation believed likely to have a material adverse effect and said disclosure controls were effective.
Important facts for investors to verify
- Whether IDE397’s dose escalation supports expansion, and whether GSK exercises its option after reviewing the data package.
- Updated, mature darovasertib–crizotinib efficacy and safety data, and FDA feedback on trial design; compare these with the preliminary results disclosed.
- Cash burn, marketable-securities valuation and liquidity runway as clinical programs progress; the stated runway is based on management’s current plan.
- Whether planned PARG, Pol Theta and Werner Helicase milestones are achieved on schedule and within available resources.
- Terms and potential dilution from future ATM or other financing: approximately $73.7 million remained available under the ATM facility at March 31, 2022.