Voyager Therapeutics, Inc. — Q3 2023 Form 10-Q
Reporting period: Three and nine months ended September 30, 2023. Voyager is a preclinical-stage biotechnology company developing AAV gene therapies and other medicines for neurological diseases. It had no product sales; revenue was from collaborations and licensing arrangements. Financial amounts below are in millions of dollars unless noted.
Financial results and liquidity
| Metric | Q3 2023 | Q3 2022 | Nine months 2023 | Nine months 2022 |
|---|---|---|---|---|
| Collaboration revenue | $4.6 | $41.1 | $159.9 | $42.5 |
| Research and development expense | $25.9 | $19.3 | $66.4 | $46.2 |
| General and administrative expense | $8.3 | $7.3 | $25.6 | $22.5 |
| Operating income (loss) | $(29.5) | $14.4 | $68.0 | $(26.3) |
| Net income (loss) | $(25.9) | $17.6 | $75.9 | $(22.8) |
- Q3 2023 diluted loss per share was $0.59; nine-month diluted earnings per share were $1.78.
- At September 30, cash and cash equivalents were $65.3 and current marketable securities were $187.7, totaling approximately $252.9. Total current assets were $261.9; total current liabilities were $61.7; stockholders’ equity was $176.2.
- For the first nine months, operating cash flow was $101.7, investing cash flow $(168.5), and financing cash flow $33.2. Cash, cash equivalents and restricted cash declined $33.6 to $66.9; investing outflows primarily reflect purchases of marketable securities.
- The balance sheet reports no debt line item. Liabilities include deferred revenue and operating lease liabilities; total liabilities were $118.4.
- Margins are not a meaningful indicator of product economics because Voyager has no product revenue and its collaboration revenue includes material licensing-related recognition.
Material changes versus comparable periods
- Nine-month revenue rose to $159.9 from $42.5, principally due to $79.0 recognized under the Novartis agreement and $75.5 under the 2023 Neurocrine agreement. The Novartis amount included option exercises and expiration of an unexercised option; the Neurocrine amount included recognition of a delivered GBA1 license.
- Q3 revenue fell to $4.6 from $41.1. Q3 2022 included $40.0 of Pfizer-related option revenue; Q3 2023 revenue was $3.1 from the 2023 Neurocrine collaboration and $1.5 from the 2019 Neurocrine collaboration.
- R&D expense increased year over year, reflecting higher staffing, program spending, manufacturing and IND-enabling work, and Neurocrine program support. G&A also increased, mainly due to compensation and stock-based compensation.
- Interest income increased to $8.6 for the nine-month period from $0.8, reflecting higher interest rates and investment balances. 2022 other income included a $2.6 employee retention tax credit.
- Voyager issued 4,395,588 shares to Neurocrine for approximately $39.0 in February 2023. Shares issued and outstanding increased to 43.9 million at September 30 from 38.6 million at year-end 2022.
Outlook, developments and risks
- Management expects cash, cash equivalents and marketable securities, together with anticipated Neurocrine cost reimbursements and interest income, to fund planned operating expenses and capital expenditures into mid-2025. The company says it will need substantial additional funding; financing may be unavailable or dilutive, and collaboration terms may require rights to be relinquished.
- Voyager selected anti-tau antibody candidate VY-TAU01, began GLP toxicology studies in Q3, and expects to submit an IND in the first half of 2024. It continued evaluating preclinical SOD1 data, expected to identify a lead candidate in 2023, and expects an IND in mid-2025.
- All pipeline programs were preclinical. The GBA1 Parkinson’s program and FXN Friedreich’s ataxia program are partnered with Neurocrine; the GBA1 lead candidate remained under evaluation.
- Alexion succeeded Pfizer as counterparty to the Pfizer option and license agreement in September 2023; the filing says material agreement terms were unchanged. Novartis exercised options for two targets and did not license a third, whose capsid rights reverted to Voyager.
- Voyager amended its Lexington lease to add approximately 61,307 square feet. The additional space was not yet available at quarter-end; commencement was estimated around February 1, 2024, with the lease ending January 31, 2031.
- Key risks include clinical and regulatory uncertainty, preclinical results not translating to humans, dependence on collaborations and future financing, partner termination or option decisions, intellectual-property and manufacturing risks, and increasing operating costs. No material legal proceedings were reported. Management assessed disclosure controls as effective.
Important facts for investors to verify
- Whether the projected mid-2025 cash runway holds as development spending rises and Neurocrine reimbursements and interest income are realized.
- Progress and timing for VY-TAU01’s planned first-half 2024 IND and the SOD1 program’s candidate selection and mid-2025 IND target.
- How much reported collaboration revenue reflects upfront or option-related recognition versus recurring research services, and what future partner milestones or option exercises remain uncertain.
- Potential dilution from equity compensation and collaboration-related share issuance, and the financial effect of the expanded Lexington lease.
- Whether preclinical findings for the company’s capsids and programs translate into safe, effective clinical therapies; no clinical-stage product data were reported in this filing.